**EXHIBIT10.4**

 

 

**SUBORDINATIONAND INTERCREDITOR AGREEMENT**

 

**                THIS SUBORDINATION ANDINTERCREDITOR AGREEMENT** (this “**Agreement**”) is entered into as of this 4th day ofFebruary, 2002, by and among U-C HOLDINGS, L.L.C., a Delaware limited liabilitycompany (“**Holdings**”),CTN MEDIA GROUP, INC., f/k/a College Television Network, Inc., a Delawarecorporation (the “**Borrower**”), and LASALLE BANK NATIONALASSOCIATION, a national banking association, as “**Lender**” under the SeniorCredit Agreement described below.

 

**R E C I T A L S**

 

                **A.**             The Borrower and Senior Lender (ashereinafter defined) have entered into a certain Amended and Restated CreditAgreement dated as of August 14, 2001 (as the same may be amended, supplementedor otherwise modified from time to time, the “**Senior Credit Agreement**”)pursuant to which, among other things, Senior Lender has agreed, subject to theterms and conditions set forth in the Senior Credit Agreement, to make certainloans and financial accommodations to the Borrower. All of the Borrower’s obligationsto Senior Lender under the Senior Credit Agreement and the other Senior DebtDocuments (as hereinafter defined) are secured by liens on and securityinterests in substantially all of the now existing and hereafter acquired realand personal property of the Borrower (the “**Collateral**”).

 

                **B.**            The Borrower’s board of directorshas declared a dividend (the “**Dividend**”) in the aggregate principalamount of $110,000 on its outstanding Series A Convertible Preferred Stock,payment of which Dividend shall be satisfied by the issuance by Borrower of asubordinated promissory note to Holdings in the aggregate principal amount of$110,000 (the “**Dividend Note**”), which will then be transferred pursuant toand in accordance with the terms and provisions of that certain Termination andPurchase Agreement (the “**Termination Agreement**”), dated as of thedate hereof, by and between Holdings, Borrower and Daniel D. Davenport (“**Davenport**”).

 

                **C.**            Concurrently herewith Borrower andSenior Lender are entering into, among other things, a certain Consent andWaiver (Dividend Note) of even date herewith (the “**Consent**”) whereby SeniorLender consents (i) to the issuance by Borrower of the Dividend Note and (ii)the assignment of the Dividend Note by Holdings to Davenport.

 

                **D.**           As an inducement to and as oneof the conditions precedent to the agreement of Senior Lender to consummate thetransactions contemplated by the Consent, Senior Lender has required theexecution and delivery of this Agreement by Holdings****and the Borrower in order toset forth the relative rights and priorities of Senior Lender and SubordinatedCreditor (as hereinafter defined) under the Senior Debt Documents and theSubordinated Debt Documents (as hereinafter defined).

 

 

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                **NOW,THEREFORE,** in order to induce Senior Lender to consummate thetransactions contemplated by the Consent, in consideration of the premises setforth above (which are incorporated herein by this reference thereto as thoughfully set forth below), and for other good and valuable consideration, thereceipt and sufficiency of which hereby are acknowledged, the parties heretohereby agree as follows:

 

**1.             Definitions.** The following terms shall have thefollowing meanings in this Agreement:

 

                “**Bankruptcy Code**”****shall mean Chapter 11 ofTitle 11 of the United States Code, as amended from time to time and anysuccessor statute and all rules and regulations promulgated thereunder.

 

                “**Distribution**” means, with respect toany indebtedness, obligation or security, (a) any payment or distribution by any Person of cash, securities orother property, by set-off or otherwise, on account of such indebtedness,obligation or security, (b) any redemption, purchase or other acquisition ofsuch indebtedness, obligation or security by any Person or (c) the granting ofany lien or security interest to or for the benefit of the holders of suchindebtedness, obligation or security in or upon any property of any Person.

 

                “**Dividend Note**”****shall have the meaning setforth in paragraph B of the Recitals.

 

**               **“**Enforcement Action**” shall mean (a) totake from or for the account of the Borrower or any guarantor of theSubordinated Debt, by set-off or in any other manner, the whole or any part ofany moneys which may now or hereafter be owing by the Borrower or any suchguarantor with respect to the Subordinated Debt, (b) to sue for payment of, orto initiate or participate with others in any suit, action or proceedingagainst the Borrower or any such guarantor to (i) enforce payment of or tocollect the whole or any part of the Subordinated Debt or (ii) commencejudicial enforcement of any of the rights and remedies under the SubordinatedDebt Documents or applicable law with respect to the Subordinated Debt, (c) toaccelerate the Subordinated Debt, (d) to exercise any put option or to causethe Borrower or any such guarantor to honor any redemption or mandatoryprepayment obligation under any Subordinated Debt Document or (e) to take anyaction under the provisions of any state or federal law, including, withoutlimitation, the Uniform Commercial Code, or under any contract or agreement, toenforce, foreclose upon, take possession of or sell any property or assets ofthe Borrower or any such guarantor.

 

                “**Family Group**” shall mean Davenport’sspouse and descendants (whether or not adopted) and any trust solely for thebenefit of Davenport, Davenport’s spouse and/or Davenport’s descendants.

 

 

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                “**Permitted Assignee**” shall mean DanielDavenport or any assignee permissible under Section 2.6 hereunder.

 

                “**Person**”****means any natural person,corporation, general or limited partnership, limited liability company, firm,trust, association, government, governmental agency or other entity, whetheracting in an individual, fiduciary or other capacity.

 

                “**Proceeding**” shall mean any voluntary orinvoluntary insolvency, bankruptcy, receivership, custodianship, liquidation,dissolution, reorganization, assignment for the benefit of creditors,appointment of a custodian, receiver, trustee or other officer with similarpowers or any other proceeding for the liquidation, dissolution or otherwinding up of a Person.

 

                “**Refinancing Senior Debt Documents**”****shallmean any financing documentation which replaces the Senior Loan Documents andpursuant to which the Senior Debt under the Senior Loan Documents arerefinanced, as such financing documentation may be amended, supplemented orotherwise modified from time to time in compliance with this Agreement.

 

                                                                “**SeniorDebt**” shall mean all obligations, liabilities and indebtednessof every nature of the Borrower from time to time owed to Senior Lender underthe Senior Debt Documents, including, without limitation, the principal amountof all debts, claims and indebtedness, accrued and unpaid interest and all fees,costs and expenses, whether primary, secondary, direct, contingent, fixed orotherwise, heretofore, now and from time to time hereafter owing, due orpayable, whether before or after the filing of a Proceeding under theBankruptcy Code together with (a) any amendments, modifications, renewals orextensions thereof to the extent not prohibited by the terms of this Agreementand (b) any interest accruing thereon after the commencement of a Proceeding,without regard to whether or not such interest is an allowed claim. Senior Debtshall be considered to be outstanding whenever any loan commitment under theSenior Debt Document is outstanding.

 

                “**Senior Debt Documents**” shall mean theSenior Loan Documents and, after any refinancing of the Senior Debt under the SeniorLoan Documents, the Refinancing Senior Debt Documents.

 

                                                                “**SeniorDefault**” shall mean any “Event of Default” under the Senior DebtDocuments, or any condition or event that, after notice or lapse of time orboth, would constitute such an Event of Default if that condition or event werenot cured or removed****within any applicable grace or cure periodset forth therein.

 

 

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                “**Senior Lender**”****shall mean LaSalle BankNational Association, as Lender under the Senior Credit Agreement, or anysuccessor or assign thereof.

 

                “**Senior Loan Documents**”****shallmean the Senior Credit Agreement and all other agreements, documents andinstruments executed from time to time in connection therewith, as the same maybe amended, supplemented or otherwise modified from time to time.

 

                “**Subordinated Creditor**” shall meanHoldings or any Permitted Assignee.

 

                                                                “**SubordinatedDebt**” shall mean all of the obligations of the Borrower toSubordinated Creditor evidenced by or incurred pursuant to the SubordinatedDebt Documents.

 

                                                                “**SubordinatedDebt Documents**” shall mean the Dividend Note, the TerminationAgreement, any other note or instrument now or hereafter issued pursuant to theTermination Agreement, any guaranty with respect to the Subordinated Debt****andall other documents, agreements and instruments now existing or hereinafterentered into evidencing or pertaining to all or any portion of the SubordinatedDebt.

 

                                                                “**SubordinatedDebt Default**” shall mean a default in the payment of theSubordinated Debt or in the performance of any term, covenant or conditioncontained in the Subordinated Debt Documents or any other occurrence permittingSubordinated Creditor to accelerate the payment of all or any portion of theSubordinated Debt.

 

                                                                “**SubordinatedDebt Default Notice**” shall mean a written notice fromSubordinated Creditor or the Borrower to Senior Lender pursuant to which SeniorLender is notified of the occurrence of a Subordinated Debt Default, whichnotice incorporates a reasonably detailed description of such Subordinated DebtDefault and which notice expressly states that it is a “Subordinated DebtDefault Notice” hereunder.

 

**2.****                                     ****Subordination****.**

 

                **2.1          Subordinationof Subordinated Debt to Senior Debt.** The Borrower covenants andagrees, and each of Subordinated Creditor and any Permitted Assignee by itsacceptance of the Subordinated Debt Documents (whether upon original issue orupon transfer or assignment) likewise covenants and agrees, notwithstandinganything to the contrary contained in any of the Subordinated Debt Documents,that the payment of the Subordinated Debt shall be subordinate and subject, tothe extent and in the manner hereinafter set forth, to the payment of theSenior Debt. Each holder of Senior Debt, whether such Senior Debt is nowoutstanding or hereafter 

 

 

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created, incurred,assumed or guaranteed, shall be deemed to have acquired Senior Debt in relianceupon the provisions contained in this Agreement.

 

                **2.2          Liquidation, Dissolution, Bankruptcy.**In the event of any Proceeding involving the Borrower:

 

                (a)           AllSenior Debt shall first be indefeasibly paid in full in cash and allcommitments to lend under the Senior Debt Documents shall be terminated beforeany Distribution, whether in cash, securities or other property, shall be madeto Subordinated Creditor on account of any Subordinated Debt, except asexpressly set forth in Section 2.3 hereof.

 

                (b)           AnyDistribution, whether in cash, securities or other property which wouldotherwise, but for the terms hereof and other than as expressly permitted underSection 2.3 hereof, be payable or deliverable in respect of theSubordinated Debt shall be paid or delivered directly to Senior Lender (to beheld and/or applied by Senior Lender in accordance with the terms of the SeniorDebt Documents) until all Senior Debt is indefeasibly paid in full in cash andall commitments to lend under the Senior Debt Documents shall have beenterminated. Subordinated Creditor irrevocably authorizes, empowers and directsany debtor, debtor in possession, receiver, trustee, liquidator, custodian,conservator or other Person having authority, to pay or otherwise deliver allsuch Distributions to Senior Lender. Subordinated Creditor also irrevocablyauthorizes and empowers Senior Lender, in the name of Subordinated Creditor, todemand, sue for, collect and receive any and all such Distributions.

 

                (c)           SubordinatedCreditor agrees not to initiate, prosecute or participate in any claim, action orother proceeding challenging the enforceability, validity, perfection orpriority of the Senior Debt or any liens and security interests securing theSenior Debt.

 

                (d)           SubordinatedCreditor agrees to execute, verify, deliver and file any proofs of claim inrespect of the Subordinated Debt requested by Senior Lender in connection withany such Proceeding and hereby irrevocably authorizes, empowers and appointsSenior Lender its agent and attorney-in-fact to (i) execute, verify, deliverand file such proofs of claim upon the failure of Subordinated Creditorpromptly to do so prior to 30 days before the expiration of the time to fileany such proof of claim and (ii) vote such claim in any such Proceeding uponthe failure of Subordinated Creditor to do so prior to 15 days before theexpiration of the time to vote any such claim; provided Senior Lender shallhave no obligation to execute, verify, deliver, file and/or vote any such proofof claim. In the event that Senior Lender votes any claim in accordance withthe authority granted hereby, Subordinated Creditor shall not be entitled tochange or withdraw such vote.

 

 

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                (e)           TheSenior Debt shall continue to be treated as Senior Debt and the provisions ofthis Agreement shall continue to govern the relative rights and priorities ofSenior Lender and Subordinated Creditor even if all or part of the Senior Debtor the security interests securing the Senior Debt are subordinated, set aside,avoided, invalidated or disallowed in connection with any such Proceeding, andthis Agreement shall be reinstated if at any time any payment of any of theSenior Debt is rescinded or must otherwise be returned by any holder of SeniorDebt or any representative of such holder.

 

                **2.3          SubordinatedDebt Payments.** Notwithstanding anything in this Agreement or the Senior Loan Documentsto the contrary and subject to Section 2.2 above, Borrower shall beentitled to make regularly scheduled payments of principal and interest on theDividend Note in accordance with the express terms thereof and SubordinatedCreditor shall be entitled to reimbursement of reasonable attorney’s fees andcourt costs (if any) in accordance with the express terms of the Dividend Note.  Subject to Section 2.4 below,all other payments on the Subordinated Debt are hereby prohibited without theprior written consent of the Senior Lender.

 

**2.4          SubordinatedDebt Standstill Provisions.**  Until theSenior Debt is indefeasibly paid in full in cash and all commitments to lendunder the Senior Debt Documents shall be terminated, if an Event of Default (asdefined in the Senior Credit Agreement) under the Senior Debt Documents hasoccurred and is continuing and the Senior Lender has accelerated the SeniorDebt, and the Senior Lender shall have provided written notice to theSubordinated Creditor thereof, Subordinated Creditor shall not, without theprior written consent of Senior Lender, take any Enforcement Action withrespect to the Subordinated Debt during the time that such Event of Default iscontinuing; provided that, Senior Lender hereby agrees that it shall notaccelerate the Senior Debt solely for the purpose of preventing SubordinatedCreditor from taking an Enforcement Action in accordance with the terms of thisAgreement.  Notwithstanding theforegoing, Subordinated Creditor may file proofs of claim against the Borrowerin any Proceeding involving the Borrower. Any Distributions or other proceeds of any Enforcement Action obtainedby Subordinated Creditor in violation of the foregoing prohibition shall in anyevent be held in trust by it for the benefit of Senior Lender and promptly paidor delivered to Senior Lender in the form received until such time that suchEvent of Default has been cured or waived and is no longer continuing.  Notwithstanding the foregoing, until theSenior Debt is indefeasibly paid in full in cash and all commitments to lendunder the Senior Debt Documents shall be terminated, Subordinated Creditor shallnot file, join in the filing of, induce others to file, or cooperate in thefiling of, an involuntary bankruptcy petition against the Borrower.

 

**                2.5**          **IncorrectPayments**. If any Distribution on account of the SubordinatedDebt not permitted to be made by the Borrower or accepted by SubordinatedCreditor under this Agreement is made and received by Subordinated Creditor,such Distribution shall not be 

 

 

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commingled with any of the assets of SubordinatedCreditor, shall be held in trust by Subordinated Creditor for the benefit ofSenior Lender and shall be promptly paid over to Senior Lender for application(in accordance with the Senior Debt Documents ) to the payment of the SeniorDebt then remaining unpaid, until all of the Senior Debt is paid in full.

 

**                2.6          Sale, Transfer or other Dispositionof Subordinated Debt.**

 

(a)   Otherthan (i) the assignment and transfer of the Dividend Note from Holdings toDavenport and (ii) any assignment or transfer of the Dividend Note bywill, pursuant to the laws of descent and distribution, or to a member ofDavenport’s Family Group, Subordinated Creditor shall not sell, assign, pledge,dispose of or otherwise transfer all or any portion of the Subordinated Debt orany Subordinated Debt Document.

 

(b)           Notwithstanding the foregoing, thesubordination effected hereby shall survive any sale, assignment, pledge,disposition or other transfer of all or any portion of the Subordinated Debt inviolation of the foregoing prohibition, and the terms of this Agreement shallbe binding upon the successors and assigns of Subordinated Creditor, asprovided in Section 9 hereof.

 

**                2.7          Legends**. Until the termination of this Agreement inaccordance with Section 15 hereof, Subordinated Creditor will cause to beclearly, conspicuously and prominently inserted on the face of the DividendNote and any other Subordinated Debt Document, as well as any renewals orreplacements thereof, the following legend:

 

                “This instrument and the rights and obligationsevidenced hereby are subordinate in the manner and to the extent set forth inthat certain Subordination and Intercreditor Agreement (the “SubordinationAgreement”) dated as of February 4, 2002 among U-C Holdings, L.L.C., a Delawarelimited liability company (“Holdings”), CTN Media Group, Inc., f/k/a CollegeTelevision Network, Inc., a Delaware corporation (the “Borrower”) and LaSalleBank National Association (“Senior Lender”), to the indebtedness (includinginterest) owed by the Borrower pursuant to that certain Amended and Restated CreditAgreement dated as of August 14, 2001 among the Borrower and Senior Lender, assuch****CreditAgreement has been and hereafter may be amended, supplemented or otherwisemodified from time to time and to indebtedness refinancing the indebtednessunder that agreement as contemplated by the Subordination Agreement; and eachholder of this instrument, by its acceptance hereof, irrevocably agrees to bebound by the provisions of the Subordination Agreement.”

 

**3.             Modifications.**

 

 

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                **3.1          Modifications to Senior DebtDocuments. **Senior Lendermay at any time and from time to time without the consent of or notice toSubordinated Creditor, without incurring liability to Subordinated Creditor andwithout impairing or releasing the obligations of Subordinated Creditor underthis Agreement, change the manner or place of payment or extend the time ofpayment of or renew or alter any of the terms of the Senior Debt, or amend inany manner any agreement, note, guaranty or other instrument evidencing orsecuring or otherwise relating to the Senior Debt.

 

                **3.2          Modifications to Subordinated DebtDocuments. **Until theSenior Debt has been indefeasibly paid in full in cash and all lendingcommitments under the Senior Debt Documents have terminated, andnotwithstanding anything to the contrary contained in the Subordinated DebtDocuments, Subordinated Creditor shall not, without the prior written consentof Senior Lender, agree to any amendment, modification or supplement to theSubordinated Debt Documents.

 

**4.             Representations and Warranties**.

                **4.1          Representationsand Warranties of Holdings.** Holdings hereby represents and warrants to Senior Lender that as of thedate hereof: (a) Holdings is a limited liability company duly formed andvalidly existing under the laws of the State of Delaware; (b) Holdings hasthe power and authority to enter into, execute, deliver and carry out the termsof this Agreement, all of which have been duly authorized by all proper andnecessary action; (c) the execution of this Agreement by Holdings will notviolate or conflict with the organizational documents of Holdings, any materialagreement binding upon Holdings or any law, regulation or order or require anyconsent or approval which has not been obtained; (d) this Agreement is thelegal, valid and binding obligation of Holdings, enforceable against Holdingsin accordance with its terms, except as such enforceability may be limited byapplicable bankruptcy, insolvency, reorganization, moratorium or similar lawsaffecting the enforcement of creditors’ rights generally and by equitableprinciples; (e) Holdings is the sole owner, beneficially (other than withrespect to Davenport) and of record, of the Subordinated Debt Documents and theSubordinated Debt; and (f) the Subordinated Debt is, and at all timesprior to the termination of this Agreement shall remain, an unsecuredobligation of the Borrower.

 

**                4.2          Representations and Warranties of Senior Lender.** Senior Lender hereby represents and warrants to Subordinated Creditorthat as of the date hereof: (a) Senior Lender is a national bankingassociation; (b) Senior Lender has the power and authority to enter into,execute, deliver and carry out the terms of this Agreement, all of which havebeen duly authorized by all proper and necessary action; (c) the execution ofthis Agreement by Senior Lender will not violate or conflict with theorganizational documents of Senior Lender, any material agreement binding uponSenior Lender or any law, regulation or order or require any consent orapproval which has not been obtained; and (d) this Agreement is the legal,valid and 

 

 

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binding obligation of Senior Lender, enforceableagainst Senior Lender in accordance with its terms, except as suchenforceability may be limited by applicable bankruptcy, insolvency,reorganization, moratorium or similar laws affecting the enforcement ofcreditors’ rights generally or by equitable principles.

 

**5.             Subordination of Distributions**. Subordinated Creditor agrees that in the event that all or any part of apayment made with respect to the Senior Debt is recovered from the holders ofthe Senior Debt in a Proceeding or otherwise, any Distribution received bySubordinated Creditor with respect to the Subordinated Debt at any time afterthe date of the payment that is so recovered shall be deemed to have beenreceived by Subordinated Creditor in trust as property of the holders of theSenior Debt and Subordinated Creditor shall forthwith deliver the same to theSenior Lender for the benefit of the Senior Lender for application to theSenior Debt until the Senior Debt is paid in full. A Distribution made pursuantto this Agreement to Senior Lender which otherwise would have been made toSubordinated Creditor is not, as between the Borrower and SubordinatedCreditor, a payment by the Borrower to or on account of the Senior Debt.

 

**6.             Modification**. Any modification or waiver of anyprovision of this Agreement, or any consent to any departure by any party fromthe terms hereof, shall not be effective in any event unless the same is inwriting and signed by Senior Lender and Subordinated Creditor, and then suchmodification, waiver or consent shall be effective only in the specificinstance and for the specific purpose given. Any notice to or demand on anyparty hereto in any event not specifically required hereunder shall not entitlethe party receiving such notice or demand to any other or further notice ordemand in the same, similar or other circumstances unless specifically requiredhereunder.

 

**7.             Further Assurances**. Each party to this Agreement promptlywill execute and deliver such further instruments and agreements and do suchfurther acts and things as may be reasonably requested in writing by any otherparty hereto that may be necessary or desirable in order to effect fully thepurposes of this Agreement.

 

**8.             Notices**. Unless otherwise specifically providedherein, any notice delivered under this Agreement shall be in writing addressedto the respective party as set forth below and may be personally served,telecopied or sent by overnight courier service or certified or registeredUnited States mail and shall be deemed to have been given (a) if delivered inperson, when delivered; (b) if delivered by telecopy, on the date oftransmission if transmitted on a business day before 4:00 p.m. (Chicago time)or, if not, on the next succeeding business day; (c) if delivered by overnightcourier, one business day after delivery to such courier properly addressed; or(d) if by United States mail, four business days after deposit in the UnitedStates mail, postage prepaid and properly addressed.

 

 

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                Notices shall be addressed as follows:

 

                                If to Holdings:

 

                                U-C Holdings, L.L.C.

                                227 West Monroe Street, Suite 4300

                                Chicago, IL  60606

                                Attention:  Avy H. Stein & Daniel M. Gill

                                Telecopy:  312-422-2424

 

                                With a copy to:

 

                                Kirkland & Ellis

                                200 E. Randolph Street

                                Chicago, IL  60601

                                Attention:  Margaret A. Gibson

                                Telecopy:   312-861-2200

 

                                If to Davenport:

 

                                Daniel D. Davenport

                                120 Lafayette Drive, #11

                                Atlanta, Georgia  30309

 

                                With a copy to:

 

                                D. Denby Davenport, Jr.

                                P.O. Box 10267

                                Greenville, South Carolina  29603

                                Telecopy:  (864) 242-9271

 

                                If to the Borrower:

 

                                CTN Media Group, Inc.

                                3350 Peachtree Road, Suite 1500

                                Atlanta, Georgia  30326

                                Attention:   Neil H. Dickson

                                Telecopy:  404-256-9168

 

 

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                                With a copy to:

 

                                Morris,Manning & Martin, L.L.P.

                                1600 Atlanta Financial Center

                                3343 Peachtree Road, N.E.

                                Atlanta, Georgia  30326

                                Attention:  Lauren Z. Burnham

                                Telecopy:  404-365-9532

 

                                If to Senior Lender:

 

                                LaSalle Bank National Association

                                135 South LaSalle Street

                                Chicago, Illinois 60603

                                Attention:              Charles Corbisiero

                                Telecopy:              (312) 904-4779

 

                                With a copy to:

 

                                Katten Muchin Zavis

                                525 West Monroe Street

                                Chicago, Illinois 60661

                                Attention:              René Ghadimi

                                Telecopy:              (312) 577-8797

 

 

or in any case, to such other address as the partyaddressed shall have previously designated by written notice to the servingparty, given in accordance with this Section 8.

 

**9.             Successors and Assigns**. This Agreement shall inure to the benefit of, and shall be binding upon,the respective successors and assigns of Senior Lender, Subordinated Creditorand the Borrower.  To the extentpermitted under the Senior Debt Documents, Senior Lender may, from time totime, without notice to Subordinated Creditor, assign or transfer any or all ofthe Senior Debt or any interest therein to any Person and, notwithstanding anysuch assignment or transfer, or any subsequent assignment or transfer, theSenior Debt shall, subject to the terms hereof, be and remain Senior Debt forpurposes of this Agreement, and every permitted assignee or transferee of anyof the Senior Debt or of any interest therein shall, to the extent of theinterest of such permitted assignee or transferee in the Senior Debt, beentitled to rely upon and be the third party beneficiary of the subordinationprovided under this Agreement and shall be entitled to enforce the terms andprovisions hereof to the same extent as if such assignee or transferee wereinitially a party hereto.  Any PermittedAssignee of the Dividend Note (a) shall be entitled 

 

 

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to rely upon and be the third party beneficiary ofthis Agreement and (b) shall be subject to the subordination providedunder this Agreement, to the same extent as if such Permitted Assignee wereinitially a party hereto.

 

**10.          Relative Rights. **This Agreement shall define the relative rights ofSenior Lender and Subordinated Creditor. Nothing in this Agreement shall (a)impair, as between the Borrower and Senior Lender and as between the Borrowerand Subordinated Creditor, the obligation of the Borrower with respect to thepayment of the Senior Debt and the Subordinated Debt in accordance with theirrespective terms or (b) affect the relative rights of Senior Lender or SubordinatedCreditor with respect to any other creditors of the Borrower.

 

**11.          Conflict**. In the event of any conflict betweenany term, covenant or condition of this Agreement and any term, covenant orcondition of any of the Subordinated Debt Documents, the provisions of thisAgreement shall control and govern.

 

**12.          Headings**. The paragraph headings used in thisAgreement are for convenience only and shall not affect the interpretation ofany of the provisions hereof.

 

**13.          Counterparts.**This Agreement may be executed in one ormore counterparts, each of which shall be deemed an original, but all of whichtogether shall constitute one and the same instrument.

 

**14.          Severability.**In the event that any provision of thisAgreement is deemed to be invalid, illegal or unenforceable by reason of theoperation of any law or by reason of the interpretation placed thereon by anycourt or governmental authority, the validity, legality and enforceability ofthe remaining provisions of this Agreement shall not in any way be affected orimpaired thereby, and the affected provision shall be modified to the minimumextent permitted by law so as most fully to achieve the intention of thisAgreement.

 

**15.          Continuation of Subordination;Termination of Agreement**. This Agreement shall remain in full force and effectuntil the indefeasible payment in full in cash of the Senior Debt and thetermination of all lending commitments under the Senior Debt Documents afterwhich this Agreement shall terminate without further action on the part of theparties hereto.

 

**16.          Applicable Law.**This Agreement shall be governed by andshall be construed and enforced in accordance with the internal laws of theState of Illinois, without regard to conflicts of law principles.

 

**17.          CONSENT TO JURISDICTION.****EACH OF SUBORDINATED CREDITOR AND THE BORROWER HEREBYCONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THECOUNTY OF COOK, STATE OF**

** **

 

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**ILLINOISAND IRREVOCABLY AGREES THAT, SUBJECT TO SENIOR LENDER’S ELECTION, ALL ACTIONSOR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE LITIGATEDIN SUCH COURTS. EACH OF SUBORDINATED CREDITOR AND THE BORROWER EXPRESSLYSUBMITS AND CONSENTS TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANYDEFENSE OF FORUM NON CONVENIENS.  EACHOF SUBORDINATED CREDITOR AND THE BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANYAND ALL PROCESS AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON ITBY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TOSUBORDINATED CREDITOR AND THE BORROWER AT THEIR RESPECTIVE ADDRESSES SET FORTHIN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THESAME HAS BEEN POSTED.**

 

**18.          WAIVER OF JURY TRIAL.**** SUBORDINATEDCREDITOR, THE COMPANY AND SENIOR LENDER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TOA JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THISAGREEMENT, ANY OF THE SUBORDINATED DEBT DOCUMENTS OR ANY OF THE SENIOR DEBTDOCUMENTS. EACH OF SUBORDINATED CREDITOR, THE COMPANY AND SENIOR LENDERACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESSRELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THISAGREEMENT AND THE SENIOR DEBT DOCUMENTS AND THAT EACH WILL CONTINUE TO RELY ONTHE WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH OF SUBORDINATED CREDITOR, THECOMPANY AND SENIOR LENDER WARRANTS AND REPRESENTS THAT EACH HAS HAD THEOPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT EACHKNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.**

 

 

*Balance of Page Intentionally LeftBlank*

*Signature Page Follows*

 

 

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**               **IN WITNESS WHEREOF, the parties hereto have causedthis Subordination and Intercreditor Agreement to be executed as of the datefirst above written.

 

|   | SUBORDINATED CREDITOR:                                                                   |
|--------|------------------------------------------------------------------------------------------|
|   |                                                                                     |   |
|   | **U-C  HOLDINGS, L.L.C.**,  a Delaware limited liability company                         |
|   |                                                                                     |   |
|   | By: Willis Stein & Partners, L.P.                                                    |
|   | Its: Managing Member                                                                     |
|   |                                                                                     |   |
|   | By: Willis Stein & Partners, L.L.C.                                                  |
|   |                                                                                     | Its: General Partner |
|   |                                                                                     |   |
|   | By:                                                                                      | /s/ Avy H. Stein |
|   |                                                                                     | Name: Avy H. Stein |
|   |                                                                                     | Title: Managing Director |
|   |                                                                                     |   |
|   | BORROWER:                                                                                |
|   |                                                                                     |   |
|   | **CTN  MEDIA GROUP, INC**.,  a Delaware corporation                                      |
|   |                                                                                     |   |
|   | By:                                                                                      | /s/ Neil H.  Dickson |
|   | Name:                                                                                    | Neil H. Dickson |
|   | Its:                                                                                     | Chief Operating Officer |
|   |                                                                                     |   |
|   | SENIOR LENDER:                                                                           |
|   |                                                                                     |   |
|   | **LASALLE  BANK NATIONAL ASSOCIATION**, a national banking association, as Senior Lender |
|   |                                                                                     |   |
|   | By:                                                                                      | /s/ Charles  Corbisicro |
|   | Name:                                                                                    | Charles Corbisicro |
|   | Its:                                                                                     | Vice President |

 

 

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# ***(SIGNATURE PAGE TO SUBORDINATION AND INTERCREDITORAGREEMENT)***

Agreed to and acknowledged by

on this         dayof February, 2002:

 

 

 
| /s/ Daniel D.  Davenport |
|--------------------------|
| Daniel D. Davenport      |

 

 

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