exv10w1



 





EXHIBIT 10.1




Published CUSIP Number: __________________




REVOLVING CREDIT AND TERM LOAN AGREEMENT




Dated as of May 10, 2004




among




EMMIS OPERATING COMPANY,

as Borrower




EMMIS COMMUNICATIONS CORPORATION,

as Parent




THE LENDERS LISTED ON SCHEDULE 1 HERETO

and




BANK OF AMERICA, N.A.,

as Administrative Agent,




GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Syndication Agent




WACHOVIA BANK, N.A.,

DEUTSCHE BANK SECURITIES INC., and

CREDIT SUISSE FIRST BOSTON, ACTING THROUGH ITS CAYMAN ISLANDS BRANCH,

as Co-Documentation Agents, and




BANC OF AMERICA SECURITIES LLC,

GOLDMAN SACHS CREDIT PARTNERS L.P., and

WACHOVIA CAPITAL MARKETS, LLC,

As Joint Lead Arrangers and Joint Book Managers




 









 








TABLE OF CONTENTS




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Page

	1.	 	DEFINITIONS AND RULES OF INTERPRETATION	 	 	1	 
	 	 	 	 	 	1.1.	 	 	Definitions	 	 	1	 
	 	 	 	 	 	1.2.	 	 	Rules of Interpretation	 	 	26	 
	2.	 	THE REVOLVING CREDIT FACILITY	 	 	26	 
	 	 	 	 	 	2.1.	 	 	Commitment to Lend	 	 	26	 
	 	 	 	 	 	2.2.	 	 	Commitment Fee	 	 	27	 
	 	 	 	 	 	2.3.	 	 	Reduction of Revolving Credit Commitment	 	 	27	 
	 	 	 	 	 	2.4.	 	 	Evidence of Revolving Credit Loans; Revolving Credit Notes	 	 	27	 
	 	 	 	 	 	2.5.	 	 	Interest on Revolving Credit Loans	 	 	28	 
	 	 	 	 	 	2.6.	 	 	Requests for Revolving Credit Loans	 	 	28	 
	 	 	 	 	 	2.7.	 	 	Conversion Options	 	 	28	 
	

	 	 	 	 	 	 	 	 	2.7.1.	 	 	Conversion to Different Type of Revolving Credit Loan
	 	 	29	 
	

	 	 	 	 	 	 	 	 	2.7.2.	 	 	Continuation of Type of Revolving Credit Loan
	 	 	29	 
	

	 	 	 	 	 	 	 	 	2.7.3.	 	 	Eurodollar Rate Loans
	 	 	29	 
	 	 	 	 	 	2.8.	 	 	Funds for Revolving Credit Loans	 	 	29	 
	

	 	 	 	 	 	 	 	 	2.8.1.	 	 	Funding Procedures
	 	 	29	 
	

	 	 	 	 	 	 	 	 	2.8.2.	 	 	Advances by Administrative Agent
	 	 	30	 
	 	 	 	 	 	2.9.	 	 	Settlements	 	 	30	 
	

	 	 	 	 	 	 	 	 	2.9.1.	 	 	General
	 	 	30	 
	

	 	 	 	 	 	 	 	 	2.9.2.	 	 	Failure to Make Funds Available
	 	 	31	 
	

	 	 	 	 	 	 	 	 	2.9.3.	 	 	No Effect on Other Revolving Credit Lenders
	 	 	31	 
	 	 	 	 	 	2.10.	 	 	Repayment Of The Revolving Credit Loans	 	 	31	 
	

	 	 	 	 	 	 	 	 	2.10.1.	 	 	Maturity
	 	 	31	 
	

	 	 	 	 	 	 	 	 	2.10.2.	 	 	Mandatory Repayments of Revolving Credit Loans
	 	 	31	 
	

	 	 	 	 	 	 	 	 	2.10.3.	 	 	Optional Repayments of Revolving Credit Loans
	 	 	32	 
	3.	 	THE TRANCHE B TERM LOAN	 	 	32	 
	 	 	 	 	 	3.1.	 	 	Commitment to Lend	 	 	32	 
	 	 	 	 	 	3.2.	 	 	Evidence of Tranche B Term Loan; Tranche B Term Notes	 	 	32	 
	 	 	 	 	 	3.3.	 	 	Mandatory Prepayment of Tranche B Term Loan; Scheduled Amortization	 	 	32	 
	 	 	 	 	 	3.4.	 	 	Optional Prepayment of Tranche B Term Loan	 	 	33	 
	 	 	 	 	 	3.5.	 	 	Interest on Tranche B Term Loan	 	 	33	 
	

	 	 	 	 	 	 	 	 	3.5.1.	 	 	Interest Rates
	 	 	33	 
	

	 	 	 	 	 	 	 	 	3.5.2.	 	 	Notification by Borrower
	 	 	33	 
	

	 	 	 	 	 	 	 	 	3.5.3.	 	 	Amounts, etc
	 	 	33	 
	4.	 	MANDATORY REPAYMENT OF THE LOANS	 	 	34	 
	 	 	 	 	 	4.1.	 	 	Excess Cash Flow Recapture	 	 	34	 
	 	 	 	 	 	4.2.	 	 	Proceeds of Asset Sales and Asset Swaps	 	 	34	 
	 	 	 	 	 	4.3.	 	 	Proceeds of Equity Issuances	 	 	34	 
	 	 	 	 	 	4.4.	 	 	Proceeds of Subordinated Debt Issuances	 	 	35	 
	 	 	 	 	 	4.5.	 	 	Application of Payments	 	 	35	 
	 	 	 	 	 	4.6.	 	 	Delivery of Proceeds	 	 	35	 
	5.	 	LETTERS OF CREDIT	 	 	35	 
	 	 	 	 	 	5.1.	 	 	Letter of Credit Commitments	 	 	35	 
	

	 	 	 	 	 	 	 	 	5.1.1.	 	 	Commitment to Issue Letters of Credit
	 	 	35	 
	

	 	 	 	 	 	 	 	 	5.1.2.	 	 	Letter of Credit Applications
	 	 	36	 
	

	 	 	 	 	 	 	 	 	5.1.3.	 	 	Terms of Letters of Credit
	 	 	36	 
	

	 	 	 	 	 	 	 	 	5.1.4.	 	 	Reimbursement Obligations of Revolving Credit Lenders
	 	 	36	 
	

	 	 	 	 	 	 	 	 	5.1.5.	 	 	Participations of Revolving Credit Lenders
	 	 	36	 
	 	 	 	 	 	5.2.	 	 	Reimbursement Obligation of the Borrower	 	 	36	 
	 	 	 	 	 	5.3.	 	 	Letter of Credit Payments	 	 	37	 
	 	 	 	 	 	5.4.	 	 	Obligations Absolute	 	 	38	 
	 	 	 	 	 	5.5.	 	 	Reliance by Issuer	 	 	38	 







i









 





TABLE OF CONTENTS
(continued)


	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Page

	 	 	 	 	 	5.6.	 	 	Letter of Credit Fee	 	 	38	 
	6.	 	CERTAIN GENERAL PROVISIONS	 	 	38	 
	 	 	 	 	 	6.1.	 	 	Closing Fees. The Borrower agrees to pay all fees on
the Funding Date that have been expressly agreed to in
writing between the Borrower and certain of the Lenders to be
paid on the Funding Date	 	 	38	 
	 	 	 	 	 	6.2.	 	 	Administrative Agent’s Fee	 	 	39	 
	 	 	 	 	 	6.3.	 	 	Funds for Payments	 	 	39	 
	

	 	 	 	 	 	 	 	 	6.3.1.	 	 	Payments to Administrative Agent
	 	 	39	 
	

	 	 	 	 	 	 	 	 	6.3.2.	 	 	No Offset, etc
	 	 	39	 
	

	 	 	 	 	 	 	 	 	6.3.3.	 	 	Non-U.S. Lenders
	 	 	40	 
	 	 	 	 	 	6.4.	 	 	Computations	 	 	40	 
	 	 	 	 	 	6.5.	 	 	Inability to Determine Eurodollar Rate	 	 	40	 
	 	 	 	 	 	6.6.	 	 	Illegality	 	 	41	 
	 	 	 	 	 	6.7.	 	 	Additional Costs, etc	 	 	41	 
	 	 	 	 	 	6.8.	 	 	Capital Adequacy	 	 	42	 
	 	 	 	 	 	6.9.	 	 	Certificate	 	 	42	 
	 	 	 	 	 	6.10.	 	 	Indemnity	 	 	42	 
	 	 	 	 	 	6.11.	 	 	Interest After Default	 	 	43	 
	 	 	 	 	 	6.12.	 	 	Mitigation Obligations; Replacement of Lenders	 	 	43	 
	7.	 	COLLATERAL SECURITY AND GUARANTIES	 	 	43	 
	 	 	 	 	 	7.1.	 	 	Security of Borrower	 	 	43	 
	 	 	 	 	 	7.2.	 	 	Guaranties and Security of Parent and Subsidiaries	 	 	44	 
	 	 	 	 	 	7.3.	 	 	Release of Collateral and Guaranties	 	 	44	 
	8.	 	REPRESENTATIONS AND WARRANTIES	 	 	44	 
	 	 	 	 	 	8.1.	 	 	Corporate Authority	 	 	44	 
	

	 	 	 	 	 	 	 	 	8.1.1.	 	 	Incorporation; Good Standing
	 	 	44	 
	

	 	 	 	 	 	 	 	 	8.1.2.	 	 	Authorization
	 	 	44	 
	

	 	 	 	 	 	 	 	 	8.1.3.	 	 	Enforceability
	 	 	45	 
	 	 	 	 	 	8.2.	 	 	Governmental Approvals	 	 	45	 
	 	 	 	 	 	8.3.	 	 	Title to Properties	 	 	45	 
	 	 	 	 	 	8.4.	 	 	Financial Statements and Projections	 	 	45	 
	

	 	 	 	 	 	 	 	 	8.4.1.	 	 	Fiscal Year
	 	 	45	 
	

	 	 	 	 	 	 	 	 	8.4.2.	 	 	Financial Statements
	 	 	45	 
	

	 	 	 	 	 	 	 	 	8.4.3.	 	 	Projections
	 	 	45	 
	 	 	 	 	 	8.5.	 	 	No Material Adverse Changes, etc	 	 	46	 
	 	 	 	 	 	8.6.	 	 	Franchises, Patents, Copyrights, etc	 	 	46	 
	 	 	 	 	 	8.7.	 	 	Litigation	 	 	46	 
	 	 	 	 	 	8.8.	 	 	No Materially Adverse Contracts, etc	 	 	46	 
	 	 	 	 	 	8.9.	 	 	Compliance with Other Instruments, Laws, Status as Senior Debt, etc	 	 	46	 
	 	 	 	 	 	8.10.	 	 	Tax Status	 	 	46	 
	 	 	 	 	 	8.11.	 	 	No Event of Default	 	 	47	 
	 	 	 	 	 	8.12.	 	 	Investment Company Acts and Communications Act	 	 	47	 
	 	 	 	 	 	8.13.	 	 	Absence of Financing Statements, etc	 	 	47	 
	 	 	 	 	 	8.14.	 	 	Perfection of Security Interest	 	 	47	 
	 	 	 	 	 	8.15.	 	 	Certain Transactions	 	 	47	 
	 	 	 	 	 	8.16.	 	 	Employee Benefit Plans	 	 	47	 
	

	 	 	 	 	 	 	 	 	8.16.1.	 	 	In General
	 	 	47	 
	

	 	 	 	 	 	 	 	 	8.16.2.	 	 	Terminability of Welfare Plans
	 	 	48	 
	

	 	 	 	 	 	 	 	 	8.16.3.	 	 	Guaranteed Pension Plans
	 	 	48	 
	

	 	 	 	 	 	 	 	 	8.16.4.	 	 	Multiemployer Plans
	 	 	48	 
	 	 	 	 	 	8.17.	 	 	Use of Proceeds	 	 	48	 
	

	 	 	 	 	 	 	 	 	8.17.1.	 	 	General
	 	 	48	 
	

	 	 	 	 	 	 	 	 	8.17.2.	 	 	Regulation U
	 	 	49	 







ii









 




TABLE OF CONTENTS
(continued)


	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Page

	

	 	 	 	 	 	 	 	 	8.17.3.	 	 	Ineligible Securities
	 	 	49	 
	 	 	 	 	 	8.18.	 	 	Environmental Compliance	 	 	49	 
	 	 	 	 	 	8.19.	 	 	Subsidiaries, etc	 	 	50	 
	 	 	 	 	 	8.20.	 	 	Disclosure	 	 	50	 
	 	 	 	 	 	8.21.	 	 	Licenses and Approvals	 	 	50	 
	 	 	 	 	 	8.22.	 	 	Material Agreements	 	 	51	 
	 	 	 	 	 	8.23.	 	 	Solvency	 	 	52	 
	 	 	 	 	 	8.24.	 	 	Excluded Subsidiaries	 	 	52	 
	9.	 	AFFIRMATIVE COVENANTS	 	 	52	 
	 	 	 	 	 	9.1.	 	 	Punctual Payment	 	 	52	 
	 	 	 	 	 	9.2.	 	 	Maintenance of Office	 	 	52	 
	 	 	 	 	 	9.3.	 	 	Records and Accounts	 	 	52	 
	 	 	 	 	 	9.4.	 	 	Financial Statements, Certificates and Information	 	 	52	 
	 	 	 	 	 	9.5.	 	 	Notices	 	 	54	 
	

	 	 	 	 	 	 	 	 	9.5.1.	 	 	Defaults
	 	 	54	 
	

	 	 	 	 	 	 	 	 	9.5.2.	 	 	Environmental Events
	 	 	54	 
	

	 	 	 	 	 	 	 	 	9.5.3.	 	 	Notification of Claim against Collateral
	 	 	54	 
	

	 	 	 	 	 	 	 	 	9.5.4.	 	 	Notice of Litigation and Judgments
	 	 	54	 
	

	 	 	 	 	 	 	 	 	9.5.5.	 	 	Notice of SEC Filings, etc
	 	 	54	 
	 	 	 	 	 	9.6.	 	 	Legal Existence; Conduct of Business; Maintenance of Properties	 	 	55	 
	 	 	 	 	 	9.7.	 	 	Insurance	 	 	55	 
	 	 	 	 	 	9.8.	 	 	Taxes	 	 	55	 
	 	 	 	 	 	9.9.	 	 	Inspection of Properties and Books, etc	 	 	56	 
	

	 	 	 	 	 	 	 	 	9.9.1.	 	 	General
	 	 	56	 
	

	 	 	 	 	 	 	 	 	9.9.2.	 	 	Appraisals
	 	 	56	 
	

	 	 	 	 	 	 	 	 	9.9.3.	 	 	Communications with Accountants
	 	 	56	 
	 	 	 	 	 	9.10.	 	 	Compliance with Laws, Contracts, Licenses, and Permits	 	 	56	 
	 	 	 	 	 	9.11.	 	 	Employee Benefit Plans	 	 	57	 
	 	 	 	 	 	9.12.	 	 	Use of Proceeds	 	 	57	 
	 	 	 	 	 	9.13.	 	 	Additional Collateral	 	 	57	 
	 	 	 	 	 	9.14.	 	 	Interest Rate Protection	 	 	57	 
	 	 	 	 	 	9.15.	 	 	Additional Subsidiaries	 	 	58	 
	 	 	 	 	 	9.16.	 	 	Refinancing Note Proceeds	 	 	58	 
	 	 	 	 	 	9.17.	 	 	Further Assurances	 	 	58	 
	10.	 	CERTAIN NEGATIVE COVENANTS	 	 	58	 
	 	 	 	 	 	10.1.	 	 	Restrictions on Indebtedness	 	 	58	 
	 	 	 	 	 	10.2.	 	 	Restrictions on Liens	 	 	60	 
	

	 	 	 	 	 	 	 	 	10.2.1.	 	 	Permitted Liens
	 	 	60	 
	

	 	 	 	 	 	 	 	 	10.2.2.	 	 	Restrictions on Negative Pledges and Upstream Limitations
	 	 	62	 
	 	 	 	 	 	10.3.	 	 	Restrictions on Investments	 	 	62	 
	 	 	 	 	 	10.4.	 	 	Restricted Payments	 	 	63	 
	 	 	 	 	 	10.5.	 	 	Merger, Consolidation, Acquisition and Disposition of Assets	 	 	64	 
	

	 	 	 	 	 	 	 	 	10.5.1.	 	 	Mergers and Acquisitions
	 	 	64	 
	

	 	 	 	 	 	 	 	 	10.5.2.	 	 	Disposition of Assets
	 	 	66	 
	 	 	 	 	 	10.6.	 	 	Sale and Leaseback	 	 	67	 
	 	 	 	 	 	10.7.	 	 	Compliance with Environmental Laws	 	 	67	 
	 	 	 	 	 	10.8.	 	 	Subordinated Debt	 	 	67	 
	 	 	 	 	 	10.9.	 	 	Employee Benefit Plans	 	 	67	 
	 	 	 	 	 	10.10.	 	 	Fiscal Year	 	 	68	 
	 	 	 	 	 	10.11.	 	 	Transactions with Affiliates	 	 	68	 
	 	 	 	 	 	10.12.	 	 	Certain Intercompany Matters	 	 	68	 
	 	 	 	 	 	10.13.	 	 	Activities of the Parent	 	 	68	 
	 	 	 	 	 	10.14.	 	 	Restrictions on Equity Issuances	 	 	69	 







iii









 





TABLE OF CONTENTS
(continued)


	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Page

	11.	 	FINANCIAL COVENANTS	 	 	69	 
	 	 	 	 	 	11.1.	 	 	Total Leverage Ratio	 	 	69	 
	 	 	 	 	 	11.2.	 	 	Senior Leverage Ratio	 	 	70	 
	 	 	 	 	 	11.3.	 	 	Interest Coverage Ratio	 	 	70	 
	 	 	 	 	 	11.4.	 	 	Fixed Charge Coverage Ratio	 	 	70	 
	12.	 	CLOSING CONDITIONS	 	 	70	 
	 	 	 	 	 	12.1.	 	 	Loan Documents	 	 	70	 
	 	 	 	 	 	12.2.	 	 	Certified Copies of Governing Documents	 	 	71	 
	 	 	 	 	 	12.3.	 	 	Corporate or Other Action	 	 	71	 
	 	 	 	 	 	12.4.	 	 	Officer’s Certificates	 	 	71	 
	 	 	 	 	 	12.5.	 	 	Validity of Liens	 	 	71	 
	 	 	 	 	 	12.6.	 	 	Perfection Certificates, UCC Search Results and Survey	 	 	71	 
	 	 	 	 	 	12.7.	 	 	Title Insurance	 	 	71	 
	 	 	 	 	 	12.8.	 	 	Financial Statements	 	 	72	 
	 	 	 	 	 	12.9.	 	 	FCC Licenses; Third Party Consents	 	 	72	 
	 	 	 	 	 	12.10.	 	 	Certificates of Insurance	 	 	72	 
	 	 	 	 	 	12.11.	 	 	Opinions of Counsel	 	 	72	 
	 	 	 	 	 	12.12.	 	 	Compliance Certificate	 	 	73	 
	 	 	 	 	 	12.13.	 	 	Senior Debt Certificate	 	 	73	 
	 	 	 	 	 	12.14.	 	 	Financial Condition	 	 	73	 
	 	 	 	 	 	12.15.	 	 	Payment of Fees; Administrative Agent Fee Letter	 	 	73	 
	 	 	 	 	 	12.16.	 	 	Disbursement Instructions	 	 	73	 
	 	 	 	 	 	12.17.	 	 	Sources and Uses of Cash	 	 	73	 
	 	 	 	 	 	12.18.	 	 	Accountant’s Letter	 	 	73	 
	 	 	 	 	 	12.19.	 	 	Payoff and Termination of Existing Credit Agreement; Refinancing of Loans	 	 	73	 
	 	 	 	 	 	12.20.	 	 	Minimum Acceptances	 	 	73	 
	13.	 	CONDITIONS TO ALL BORROWINGS	 	 	74	 
	 	 	 	 	 	13.1.	 	 	Representations True; No Event of Default	 	 	74	 
	 	 	 	 	 	13.2.	 	 	No Legal Impediment	 	 	74	 
	 	 	 	 	 	13.3.	 	 	Proceedings and Documents	 	 	74	 
	14.	 	EVENTS OF DEFAULT; ACCELERATION; ETC	 	 	74	 
	 	 	 	 	 	14.1.	 	 	Events of Default and Acceleration	 	 	74	 
	 	 	 	 	 	14.2.	 	 	Termination of Commitments	 	 	78	 
	 	 	 	 	 	14.3.	 	 	Remedies	 	 	78	 
	 	 	 	 	 	14.4.	 	 	Distribution of Collateral Proceeds	 	 	79	 
	15.	 	ADDITIONAL FINANCING	 	 	79	 
	 	 	 	 	 	15.1.	 	 	Commitment Amount	 	 	79	 
	 	 	 	 	 	15.2.	 	 	Evidence of Debt	 	 	81	 
	16.	 	THE ADMINISTRATIVE AGENT	 	 	81	 
	 	 	 	 	 	16.1.	 	 	Appointment and Authority	 	 	81	 
	 	 	 	 	 	16.2.	 	 	Rights as a Lender	 	 	81	 
	 	 	 	 	 	16.3.	 	 	Exculpatory Provisions	 	 	81	 
	 	 	 	 	 	16.4.	 	 	Reliance by Administrative Agent	 	 	82	 
	

	 	 	 	 	 	 	 	 	16.4.1.	 	 	General
	 	 	82	 
	

	 	 	 	 	 	 	 	 	16.4.2.	 	 	Non-Reliance on Administrative Agent and Other Lenders
	 	 	82	 
	

	 	 	 	 	 	 	 	 	16.4.3.	 	 	Delegation of Duties
	 	 	83	 
	 	 	 	 	 	16.5.	 	 	Payments	 	 	83	 
	

	 	 	 	 	 	 	 	 	16.5.1.	 	 	Payments to Administrative Agent
	 	 	83	 
	

	 	 	 	 	 	 	 	 	16.5.2.	 	 	Distribution by Administrative Agent
	 	 	83	 
	

	 	 	 	 	 	 	 	 	16.5.3.	 	 	Delinquent Lenders
	 	 	83	 
	 	 	 	 	 	16.6.	 	 	Reimbursement by Lenders	 	 	84	 
	 	 	 	 	 	16.7.	 	 	Resignation of Administrative Agent	 	 	84	 
	 	 	 	 	 	16.8.	 	 	Administrative Agent May File Proofs of Claim	 	 	84	 







iv









 




TABLE OF CONTENTS
(continued)



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Page

	 	 	 	 	 	16.9.	 	 	No Other Duties, Etc	 	 	85	 
	17.	 	ASSIGNMENT AND PARTICIPATION	 	 	85	 
	 	 	 	 	 	17.1.	 	 	Successors and Assigns; Conditions to Assignment	 	 	85	 
	 	 	 	 	 	17.2.	 	 	Register	 	 	86	 
	 	 	 	 	 	17.3.	 	 	Participations	 	 	86	 
	 	 	 	 	 	17.4.	 	 	Assignee or Participant Affiliated with the Borrower	 	 	87	 
	 	 	 	 	 	17.5.	 	 	Miscellaneous Assignment Provisions	 	 	87	 
	18.	 	PROVISIONS OF GENERAL APPLICATIONS	 	 	88	 
	 	 	 	 	 	18.1.	 	 	Setoff	 	 	88	 
	 	 	 	 	 	18.2.	 	 	Expenses	 	 	88	 
	 	 	 	 	 	18.3.	 	 	Indemnification	 	 	89	 
	 	 	 	 	 	18.4.	 	 	Treatment of Certain Confidential Information	 	 	89	 
	

	 	 	 	 	 	 	 	 	18.4.1.	 	 	Confidentiality
	 	 	89	 
	

	 	 	 	 	 	 	 	 	18.4.2.	 	 	Prior Notification
	 	 	90	 
	

	 	 	 	 	 	 	 	 	18.4.3.	 	 	Other
	 	 	90	 
	 	 	 	 	 	18.5.	 	 	Survival of Covenants, Etc	 	 	90	 
	 	 	 	 	 	18.6.	 	 	Notices	 	 	91	 
	 	 	 	 	 	18.7.	 	 	Governing Law	 	 	91	 
	 	 	 	 	 	18.8.	 	 	Headings	 	 	91	 
	 	 	 	 	 	18.9.	 	 	Counterparts	 	 	92	 
	 	 	 	 	 	18.10.	 	 	Entire Agreement, Etc	 	 	92	 
	 	 	 	 	 	18.11.	 	 	WAIVER OF JURY TRIAL	 	 	92	 
	 	 	 	 	 	18.12.	 	 	Consents, Amendments, Waivers, Etc	 	 	92	 
	 	 	 	 	 	18.13.	 	 	Severability	 	 	94	 
	 	 	 	 	 	18.14.	 	 	USA PATRIOT Act Notice	 	 	94	 
	19.	 	FCC APPROVAL	 	 	94	 







v









 






Exhibits




	 	 	 
	Exhibit A

	 	Form of Revolving Credit Note
	Exhibit B

	 	Form of Loan Request
	Exhibit C

	 	Form of Tranche B Term Note
	Exhibit D

	 	Projections
	Exhibit E

	 	Form of Compliance Certificate
	Exhibit F

	 	Form of Officer’s Certificate
	Exhibit G

	 	Form of Instrument of Accession
	Exhibit H

	 	Form of Assignment and Acceptance
	Exhibit I

	 	Form of U.S. Tax Compliance Certificate







Schedules




	 	 	 
	Schedule 1

	 	Lenders and Commitments
	Schedule 7.1

	 	Non-Material Assets
	Schedule 8.3(a)

	 	Title to Properties
	Schedule 8.3(b)

	 	Stations
	Schedule 8.5

	 	Restricted Payments
	Schedule 8.7

	 	Litigation
	Schedule 8.10

	 	Tax Status
	Schedule 8.18

	 	Environmental Compliance
	Schedule 8.19

	 	Subsidiaries Etc.
	Schedule 8.21

	 	FCC Licenses
	Schedule 10.1

	 	Existing Indebtedness
	Schedule 10.2

	 	Existing Liens
	Schedule 10.3

	 	Existing Investments







 









 






EXECUTION COPY




REVOLVING CREDIT AND TERM LOAN AGREEMENT




     This REVOLVING CREDIT AND TERM LOAN AGREEMENT (this “Credit Agreement”) is
made as of May 10, 2004 by and among (a) EMMIS OPERATING COMPANY (the
“Borrower”), an Indiana corporation having its principal place of business at
One Emmis Plaza, 40 Monument Circle, Suite 700, Indianapolis, Indiana 46204,
(b) EMMIS COMMUNICATIONS CORPORATION (the “Parent”), an Indiana corporation
having its principal place of business at One Emmis Plaza, 40 Monument Circle,
Suite 700, Indianapolis, Indiana 46204, (c) the lending institutions listed on
Schedule 1 (together with any institution that becomes a lender pursuant to §15
or §17, the “Lenders”), (d) BANK OF AMERICA, N.A. as administrative agent for
the Lenders (in such capacity, the “Administrative Agent”), (e) GOLDMAN SACHS
CREDIT PARTNERS L.P., as syndication agent for the Lenders (in such capacity,
the “Syndication Agent”), and (f) WACHOVIA BANK, N.A., DEUTSCHE BANK SECURITIES
INC., and CREDIT SUISSE FIRST BOSTON, ACTING THROUGH ITS CAYMAN ISLANDS BRANCH,
as co-documentation agents for the Lenders (in such capacity, each a
“Co-Documentation Agent” and collectively, the “Co-Documentation Agents”).



1. DEFINITIONS AND RULES OF INTERPRETATION.




     1.1. Definitions. The following terms shall have the meanings set forth
in this §1.1 or elsewhere in the provisions of this Credit Agreement referred
to below:



     Additional Subordinated Debt. As defined in the definition of
“Subordinated Debt”.



     Adjustment Date. The second Business Day following the Business Day on
which a Compliance Certificate is required to be delivered by the Borrower
pursuant to §9.4(c).



     Administrative Agent. Bank of America, N.A., acting as administrative
agent for the Lenders, or any other Person which has been appointed as the
successor Administrative Agent in accordance with §16.8.



     Administrative Agent Fee Letter. That certain fee letter dated of even
date herewith between the Borrower and the Administrative Agent which
supercedes that certain fee letter, dated April 14, 2004, by and among the
Borrower, the Administrative Agent and Banc of America Securities LLC.



     Administrative Agent’s Fee. See §6.2.



     Administrative Agent’s Office. The Administrative Agent’s head office
located at 901 Main Street, 14th Floor, Dallas, Texas 75202-3714, or at such
other location as the Administrative Agent may designate from time to time.



     Administrative Agent’s Special Counsel. Bingham McCutchen LLP or such
other counsel as may be approved by the Administrative Agent.



     Affiliate. With respect to any 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. “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. Without limiting the
generality of the foregoing, a Person shall be deemed to be Controlled by
another Person if such other Person possesses, directly or indirectly, power to
vote ten percent (10%) or more of the securities having ordinary voting power
for the election of directors, managing general partners or the equivalent.



 









 





     Agents. Collectively, the Administrative Agent, the Syndication Agent and
the Co-Documentation Agents.



     Applicable Margin. For each period commencing on an Adjustment Date
through the date immediately preceding the next Adjustment Date (each a “Rate
Adjustment Period”), the Applicable Margin shall be as follows, subject to
increases in accordance with §15:




     (a) the Applicable Margin for each Type of Revolving Credit Loan
shall be the applicable margin set forth below for such Type with respect
to the Total Leverage Ratio, as determined for the Reference Period
ending on the fiscal quarter ended immediately prior to the applicable
Rate Adjustment Period:



Revolving Credit Loans




	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total	 	 	 	 
	 	 	Leverage	 	Base Rate	 	Eurodollar Rate
	Level
	 	Ratio
	 	Loans
	 	Loans

	I

	 	Greater than or equal to
7.00:1.00
	 	 	1.25	%	 	 	2.25	%
	II

	 	Less than 7.00:1.00 but greater
than or equal to 6.50:1.00
	 	 	1.00	%	 	 	2.00	%
	III

	 	Less than 6.50:1.00 but greater
than or equal to 6.00:1.00
	 	 	0.75	%	 	 	1.75	%
	IV

	 	Less than 6.00:1.00 but greater
than or equal to 5.50:1.00
	 	 	0.50	%	 	 	1.50	%
	V

	 	Less than 5.50:1.00 but greater
than or equal to 5.00:1.00
	 	 	0.25	%	 	 	1.25	%
	VI

	 	Less than 5.00:1.00
	 	 	0.00	%	 	 	1.00	%








provided, that if the Borrower fails to deliver any Compliance
Certificate pursuant to §9.4(c), then for the period commencing on the
second Business Day following the date on which the Compliance
Certificate was to be delivered pursuant to §9.4(c) through the earlier
to occur of (i) the date immediately following the date on which such
Compliance Certificate is delivered or (ii) the 10th Business Day
following such Adjustment Date, the Applicable Margin in respect of
Revolving Credit Loans shall be the Applicable Margin then in effect,
provided that if upon delivery, such Compliance Certificate shows the
Applicable Margin should have increased during such period, the
Applicable Margin will be increased retroactively to such Adjustment
Date. If the Borrower fails to deliver a Compliance Certificate pursuant
to §9.4(c) and such Compliance Certificate has not been delivered on or
prior to the 10th Business Day following the day on which such Compliance
Certificate was required to be delivered, then commencing on the 11th
Business Day following the day on which such Compliance Certificate was
required to be delivered, and continuing through the date on which such
Compliance Certificate is delivered, then the Applicable Margin shall be
the highest Applicable Margin set forth above;






 - 2 -









 





     (b) the Applicable Margin for all or any portion of the Tranche B
Term Loan that bears interest calculated by reference to the Base Rate
shall be 0.75% per annum; and



     (c) the Applicable Margin for all or any portion of the Tranche B
Term Loan that bears interest calculated by reference to the Eurodollar
Rate shall be 1.75% per annum.



     Applicable Pension Legislation. At any time, any pension or retirement
benefits legislation (be it national, federal, provincial, territorial or
otherwise) then applicable to the Borrower or any of its Subsidiaries.



     Approved Fund. Any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.



     Asset Sale. Any one or a series of related transactions (other than an
Asset Swap) pursuant to which the Parent, the Borrower or any Subsidiary
conveys, sells, leases, licenses or otherwise disposes of, directly or
indirectly (including by means of a simultaneous exchange of Stations), any of
its properties, businesses or assets (other than to the Borrower or any
wholly-owned Subsidiary of the Borrower) (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 Capital Stock of any Subsidiary other than to
the Borrower or any wholly-owned Subsidiary of the Borrower) whether owned on
the date hereof or thereafter acquired.



     Asset Swap. Any transfer of assets of the Borrower or any of its
Subsidiaries 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 of its Subsidiaries to elect that
§1031 of the Code be applicable to any Asset Swap.



     Assignment and Acceptance. See §17.1(b).



     Austin Investment. The acquisition by the Borrower pursuant to the terms
of the Sinclair Definitive Agreement of a 50.1% combined economic and
controlling interest in the Austin Partnership and RAM, the sole general
partner of the Austin Partnership.



     Austin Partnership. That certain 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, referred to in the
Sinclair Definitive Agreement.



     Balance Sheet Date. February 29, 2004.



     Bank of America. Bank of America, N.A., a national banking association,
in its individual capacity.



     Base Rate. The higher of (a) the variable annual rate of interest so
designated from time to time by the Administrative Agent in the United States
as its “prime rate” for Dollars, such rate being a reference rate and not
necessarily representing the lowest or best rate being charged to any customer,
and (b) one-half of one percent (0.50%) above the Federal Funds Effective Rate.
For the purposes of this definition, “Federal Funds Effective Rate” shall mean
for any day, the rate per annum equal to the weighted average of the rates on
overnight federal funds transactions with members of the Federal Reserve System
arranged by federal funds brokers, as published for such day (or, if such day
is not a Business Day, for the next preceding 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 of the quotations for such day on such
transactions received by the Administrative Agent from three funds brokers of
recognized standing selected by the Administrative Agent. Changes in the Base
Rate resulting from any changes in the Administrative Agent’s “prime rate”
shall take place immediately without notice or demand of any kind.



 - 3 -









 





     Base Rate Loans. All or any portion of the Revolving Credit Loans and
Tranche B Term Loan bearing interest calculated by reference to the Base Rate.




     Borrower. Emmis Operating Company, an Indiana corporation.



     Business Day. Any day on which banking institutions in Dallas, Texas and
New York, New York, are open for the transaction of banking business and, in
the case of Eurodollar Rate Loans, also a day which is a Eurodollar Business
Day.



     Capital Assets. 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 a Permitted Acquisition; 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. Amounts paid or Indebtedness incurred by the
Borrower or any of its Subsidiaries in connection with (i) the purchase or
lease by the Borrower or any of its Subsidiaries of Capital Assets that would
be required to be capitalized and shown on the balance sheet of such Person in
accordance with GAAP or (ii) the lease of any assets by the Borrower or any of
its Subsidiaries as lessee under any Synthetic Lease to the extent that such
assets would have been Capital Assets had the Synthetic Lease been treated for
accounting purposes as a Capitalized Lease.



     Capitalized Leases. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the discounted future rental payment
obligations under which are required to be capitalized on the balance sheet of
the lessee or obligor in accordance with GAAP.



     Capital Stock. Any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership or equity interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.



     CERCLA. See §8.18(a).



     Change of Control. An event or series of events as a consequence of which
(a) any “person” or “group” (as such terms are used in Section 13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)),
excluding any Permitted Holder, shall become, or obtain rights (whether by
means of warrants, options or otherwise) to become, the “beneficial owner” (as
defined in Rule 13(d)-3 and 13(d)-5 under the Exchange Act), directly or
indirectly, of 35% or more of the Capital Stock 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) the board of directors of the Parent or the Borrower shall
cease to consist of a majority of Continuing Directors; (c) the Borrower shall
at any time (i) cease to own Capital Stock of any Subsidiary representing the
same percentage of outstanding Capital Stock 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 Capital Stock which was permitted hereunder or
(ii) cease to own Capital Stock 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 Capital Stock was permitted hereunder; or (d) the Parent
shall cease to own one hundred percent (100%) of the issued and outstanding
Capital Stock of the Borrower.



     Code. The Internal Revenue Code of 1986.



     Co-Documentation Agents. As defined in the preamble hereto.



 - 4 -









 





     Collateral. All of the property, rights and interests (other than
Excluded Assets) of the Parent, the Borrower and its Subsidiaries that are or
are intended to be subject to the Liens created by the Security Documents.



     Collateral Assignments of Contracts. Collectively, each collateral
assignment of contracts entered into by the Borrower and/or certain of its
Subsidiaries pursuant to §10.5.1.



     Commitment. With respect to each Lender, the amount set forth on Schedule
1 hereto as the amount of such Lender’s commitment to make Loans in respect of
a particular Tranche to, and to participate in the issuance, extension and
renewal of Letters of Credit for the account of, the Borrower, as the same may
be reduced or increased from time to time in accordance with the terms hereof;
or if such commitment is terminated pursuant to the provisions hereof, zero.



     Commitment Fee. See §2.2.



     Commitment Percentage. With respect to each Lender and each Tranche, the
respective percentages set forth on Schedule 1 hereto as such Lender’s
percentage of such Loans in respect of such Tranche made or to be made by such
Lender as such percentage may be adjusted pursuant to §15 or §17.



     Common Stock. The common stock of the Parent, par value $.01 per share.



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



     Compliance Certificate. See §9.4(c).



     Consolidated or consolidated. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Borrower and its
Subsidiaries, consolidated in accordance with GAAP.



     Consolidated Current Assets. As of any date, all assets of the Borrower
and its Subsidiaries on a consolidated basis that, in accordance with GAAP, are
properly classified as current assets as of such date, but excluding cash or
cash equivalents.



     Consolidated Current Liabilities. As of any date, all liabilities and
other Indebtedness of the Borrower and its Subsidiaries on a consolidated basis
as may be properly classified as current liabilities in accordance with GAAP.



     Consolidated Excess Cash Flow. With respect to the Borrower and its
Subsidiaries and any particular fiscal period, an amount equal to (a) the sum
of (i) Consolidated Operating Cash Flow for such fiscal period plus (ii) the
change in Consolidated Working Capital between the first day of such fiscal
period and the last day of such fiscal period, if negative, minus (b) the sum
of (i) Consolidated Total Interest Expense for such fiscal period, (ii) any
voluntary and scheduled repayments of principal on any Indebtedness of the
Borrower or any of its Subsidiaries (other than Revolving Credit Loans which
shall be subject to clause (iii) below) paid or due and payable during such
fiscal period, (iii) any voluntary repayments of principal of the Revolving
Credit Loans to the extent that such repayments were accompanied by permanent
reductions in the Total Revolving Credit Commitment in like amount, (iv) cash
payments paid or payable during such fiscal period on account of Capital
Expenditures (other than Capital Expenditures financed by the issuance of
equity or the incurrence of Indebtedness other than Revolving Credit Loans),
(v) cash taxes paid or payable during such fiscal period, (vi) the change in
Consolidated Working Capital between the first day of such fiscal period and
the last day of such fiscal period, if positive, (vii) cash amounts paid in
connection with Permitted Acquisitions and Investments permitted pursuant to
§10.3 during such period (in each case to the extent not financed by the
issuance of equity or the incurrence of Indebtedness), and (viii) $10,000,000.



 - 5 -









 





     Consolidated Fixed Charges. With respect to any date of determination,
the sum of (a) Consolidated Total Interest Expense required to be paid or
accrued by the Borrower or any of its Subsidiaries during the Reference Period
most recently ended, plus (b) the sum of all principal scheduled to be paid by
the Borrower or any of its Subsidiaries with respect to Consolidated Total
Funded Debt during the Reference Period most recently ended, plus (c) all Capital
Expenditures made by the Borrower or any of its Subsidiaries during the
Reference Period most recently ended (other than Capital Expenditures financed
by the issuance of equity or the incurrence of Indebtedness other than
Revolving Credit Loans), plus (d) the aggregate amount of cash taxes paid by
the Borrower or any of its Subsidiaries in respect of the Reference Period most
recently ended, plus (e) the aggregate amount of all Distributions that the
Borrower paid with respect to its Capital Stock, and which the Borrower paid to
the Parent to enable the Parent to make Distributions in respect of the
Parent’s preferred stock, during the Reference Period most recently ended.



     Consolidated Net Income (or Deficit). For any period, the consolidated
net income (or deficit) of the Borrower and its Subsidiaries for such period,
after deduction of all expenses, taxes, and other proper charges for such
period, determined in accordance with GAAP, after eliminating therefrom (a) all
extraordinary and/or nonrecurring gains or losses, including, without
limitation, any gains (or losses) from any Asset Sale and any premiums
associated with a redemption of the Subordinated Notes and the Senior Discount
Notes made in accordance with this Credit Agreement, (b) non-cash dividends or
non-cash distributions received from Investments and (c) income and expenses
arising from or in connection with Trades and other non-cash credits to
Consolidated Net Income (or Deficit) other than income attributable to cash
payments received in a prior period to the extent that such cash payments were
not previously included in the calculation of Consolidated Net Income (or
Deficit) in a prior period.



     Consolidated Operating Cash Flow. For any period, an amount equal to (a)
the sum of (i) Consolidated Net Income (or Deficit) for such period, plus (ii)
depreciation, amortization (including Programming Amortization Expense) and all
other non-cash charges for such period deducted from Consolidated Net Income
(or Deficit), plus (iii) to the extent deducted in the calculation of
Consolidated Net Income (or Deficit), Consolidated Total Interest Expense and
cash taxes paid or payable for such period by the Borrower and its Subsidiaries
on a consolidated basis (including amounts paid or payable by the Borrower to
the Parent in respect of cash taxes paid or payable for such period by the
Parent that are attributable to the taxable income of the Borrower and its
Subsidiaries), plus (iv) losses actually incurred during such period by the
Borrower and its Subsidiaries in connection with Development Properties in an
aggregate amount not to exceed $5,000,000, less (b) (i) Corporate Overhead and,
to the extent paid or funded by the Borrower either directly or through
Distributions, Holdco Corporate Overhead Expenses, in each case, for such
period to the extent not deducted in the calculation of Consolidated Net Income
(or Deficit), (ii) all Programming Cash Payments and (iii) cash payments made
with respect to non-cash charges added back in prior periods and otherwise
excluded. For purposes of calculating Consolidated Operating Cash Flow for any
period, any Permitted Acquisition, Asset Sale or Asset Swap of the Borrower or
any of its Subsidiaries which occurred during such period shall be deemed to
have occurred immediately prior to the beginning of such period and the
calculation of Consolidated Operating Cash Flow shall be adjusted on a Pro
Forma Basis in connection therewith.



     Consolidated Total Funded Debt. At any time of determination, the sum,
without duplication, of (a) the outstanding principal amount of (i) the Loans
and (ii) other Obligations to the extent such other Obligations are due and
payable, plus (b) the outstanding principal amount of any other Indebtedness
for borrowed money owed by the Borrower or any of its Subsidiaries on a
consolidated basis (including, without limitation, Subordinated Debt), plus (c)
to the extent not otherwise included, all obligations (contingent or otherwise)
relating to letters of credit issued for the account of the Borrower and/or its
Subsidiaries, plus (d) to the extent not otherwise included, all liabilities in
respect of Capitalized Leases of the Borrower and/or its Subsidiaries, on a
consolidated basis, plus (e) to the extent not otherwise included, all purchase
money Indebtedness.



 - 6 -









 





     Consolidated Total Interest Expense. For any period, the sum, without
duplication, of (a) the aggregate amount of interest required to be paid or
accrued by the Borrower or any of its Subsidiaries during such period on all
Indebtedness of the Borrower or any of its Subsidiaries outstanding during all
or any part of such period, whether such interest was or is required to be
reflected as an item of expense or capitalized (provided that, if such interest
is capitalized, only the portion amortized for such period shall be
included as interest for such period), including, without limitation,
payments consisting of interest in respect of Capitalized Leases, Letter of
Credit Fees, commitment fees payable pursuant to this Credit Agreement and
similar fees payable in connection with other Indebtedness, plus (b) all
scheduled monthly fees payable in connection with LMA Agreements, plus (c) the
aggregate amount of any cash distributions paid or to be paid by the Borrower
to the Parent during such period to enable the Parent to pay interest with
respect to its Indebtedness including, without limitation, payments of
commitment fees or similar fees payable in connection with the Parent’s
Indebtedness. For purposes of determining the Consolidated Total Interest
Expense for any period, any Permitted Acquisition or Asset Sale of the Borrower
or its Subsidiaries which occurred during such period as permitted pursuant to
§10.5 shall be deemed to have occurred immediately prior to such period, and
Consolidated Total Interest Expense shall be determined as if (i) any
Indebtedness incurred by the Borrower or its Subsidiaries in connection with
such Permitted Acquisition or repaid in connection with such Asset Sale was
incurred or repaid, as the case may be, immediately prior to such period and
(ii) the interest rate payable by the Borrower or its Subsidiaries with respect
to any increase in Indebtedness in connection with such Permitted Acquisition
which was outstanding during all or any part of such period was at all times
equal to the rate of interest payable with respect to such Indebtedness on the
last day of the period for which Consolidated Total Interest Expense is to be
determined or if earlier, the last day on which such Indebtedness was
outstanding.



     Consolidated Working Capital. The excess of Consolidated Current Assets
over Consolidated Current Liabilities.



     Continuing Directors. The directors of the Parent and the Borrower on the
Funding Date, and each other director of the Parent or the Borrower, if (a) in
case of the Parent, such other director’s nomination for election to the board
of directors of the Parent is recommended by at least 66 2/3% of the then
Continuing Directors of the Parent in his or her election by the shareholders
of the Parent, and (b) in the case of the Borrower, such other director’s
nomination for election to the board of directors of the Borrower is
recommended by either 66 2/3% of the then Continuing Directors of the Borrower
or by the majority of the shareholders in his or her election by the
shareholders of the Borrower.



     Conversion Request. A notice given by the Borrower to the Administrative
Agent of the Borrower’s election to convert or continue a Loan in accordance
with §2.7 or §3.5.2.



     Copyright Mortgage. The Memorandum of Grant of Security Interest in
Copyrights, dated or to be dated as of the date hereof, made by the Borrower
and each of the Subsidiaries in favor of the Administrative Agent, for the
benefit of the Lenders and the Administrative Agent, in form and substance
satisfactory to the Administrative Agent.



     Corporate Overhead. For any period, that portion of the cash overhead
expenses of the Borrower and its Subsidiaries on a consolidated basis, for such
period which are not directly allocable to the operations of any of the
Stations and other operating assets of the Borrower and its Subsidiaries,
calculated on a basis consistent with past financial statements of the
Borrower, including, without duplication, the amount of salaries and bonuses
paid to the management of the Borrower.



     Credit Agreement. This Revolving Credit and Term Loan Agreement,
including the Schedules and Exhibits hereto.



     Current Note. See §15.2.



     Default. See §14.1.



 - 7 -









 





     Delinquent Lender. See §16.5.3.



     Development Property. Any Station or publishing asset which the Borrower
designates as a Development Property in a written notice delivered to the
Administrative Agent and which either (a) is
making or has made within the six (6) months preceding such designation
substantial changes in its format or (b) has been acquired within the twelve
(12) months preceding such designation; provided, that a Station or publishing
asset which has been designated a Development Property shall remain a
Development Property until the earlier to occur of (i) the date the Borrower
notifies the Administrative Agent in writing that such Station or publishing
asset is no longer a Development Property and (ii) the date which is twelve
(12) consecutive months following the date of designation; and provided further
that no Station or publishing asset may be re-designated as a Development
Property unless twelve (12) consecutive months have passed since such Station
or publishing asset ceased to be a Development Property.



     Distribution. The declaration or payment of any dividend on or in respect
of any shares of any class of Capital Stock of the Borrower or any of its
Subsidiaries, other than dividends payable solely in shares of common stock of
the Borrower; the purchase, redemption, defeasance, retirement or other
acquisition of any shares of any class of Capital Stock of the Borrower or any
of its Subsidiaries, directly or indirectly through a Subsidiary or otherwise
(including the setting apart of assets for a sinking or other analogous fund to
be used for such purpose); the return of capital by the Borrower or its
Subsidiaries to its shareholders as such; or any other distribution on or in
respect of any shares of any class of Capital Stock of the Borrower or its
Subsidiaries.



     Dollars or $. Dollars in lawful currency of the United States of America.



     Domestic Lending Office. Initially, the office of each Lender designated
as such in Schedule 1 hereto; thereafter, such other office of such Lender, if
any, located within the United States that will be making or maintaining Base
Rate Loans.



     Drawdown Date. The date on which any Revolving Credit Loan or any Term
Loan is made or is to be made.



     Eligible Assignee. Means (a) any Lender; provided that, assignments
involving all or any portion of a Revolving Credit Commitment and/or Revolving
Credit Loans to a Tranche B Lender that is not also a Revolving Credit Lender
shall be subject to the approvals specified in clause (d)(i) and (d)(ii) below;
(b) an Affiliate of a Lender; (c) an Approved Fund; and (d) any other Person
(other than a natural person) approved by (i) the Administrative Agent, and
(ii) unless an Event of Default has occurred and is continuing, the Borrower
(each such approval not to be unreasonably withheld or delayed).



     Employee Benefit Plan. Any employee benefit plan within the meaning of
§3(3) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate, other than a Guaranteed Pension Plan or a Multiemployer Plan.



     Environmental Laws. See §8.18(a).



     EPA. See §8.18(b).



     Equity Issuance. The sale or issuance (whether by public or private
offering) by the Parent, the Borrower or any Subsidiary of any of its Capital
Stock or any Equity-Like Instrument, other than sales or issuances to the
Parent, the Borrower or any Subsidiary.



     Equity-Like Instrument. 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 Capital Stock),
whether or not such instrument is considered Capital Stock, which evidences a
residual interest in the issuer or its assets after the payment of all
indebtedness and other liabilities paid prior to



 - 8 -









 





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), 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 later
of (a) the Revolving Credit Maturity Loan Date, (b) the Tranche B Maturity Date
and (c) the maturity date of any new Tranches established pursuant to §15.1. 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. The Employee Retirement Income Security Act of 1974.



     ERISA Affiliate. Any Person which is treated as a single employer with
the Borrower under §414 of the Code.



     ERISA Reportable Event. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of §4043 of ERISA and the regulations
promulgated thereunder.



     Eurocurrency Reserve Rate. For any day with respect to a Eurodollar Rate
Loan, the maximum rate (expressed as a decimal) at which any bank subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against “Eurocurrency
Liabilities” (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.



     Eurodollar Business Day. Any such day on which dealings in Dollar
deposits are conducted by and between banks in the London interbank eurodollar
market.



     Eurodollar Lending Office. Initially, the office of each Lender
designated as such in Schedule 1 hereto; thereafter, such other office of such
Lender, if any, that shall be making or maintaining Eurodollar Rate Loans.



     Eurodollar Rate. For any Interest Period with regard to a Eurodollar Rate
Loan, the rate of interest equal to (i) the rate determined by the
Administrative Agent at which Dollar deposits for such Interest Period are
offered based on information presented on the page of the Telerate screen (or
any successor thereto) that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the first day
of such Interest Period) with a term equivalent to such Interest Period and in
an amount comparable to the amount of the Eurodollar Rate Loan of the
Administrative Agent to which such Interest Period applies as of 11:00 a.m.
London time on the second Eurodollar Business Day prior to the first day of
such Interest Period, divided by (ii) a number equal to 1.00 minus the
Eurocurrency Reserve Rate; provided, however, if the rate described above does
not appear on the Telerate System on any applicable interest determination
date, the Eurodollar Rate shall be the rate (rounded upward, if necessary, to
the nearest one hundred-thousandth of a percentage point), determined on the
basis of the offered rates for deposits in Dollars in an amount equal to the
Eurodollar Rate Loan to be advanced by the Administrative Agent for a period of
time comparable to such Interest Period which are offered by four major banks
in the London interbank market at approximately 11:00 a.m. London time, on the
second Eurodollar Business Day prior to the first day of such Interest Period
as selected by the Administrative Agent. The principal London office of each
of the four major London banks will be requested to provide a quotation of its
Dollar deposit offered rate. If at least two such quotations are provided, the
rate for that date will be the arithmetic mean of the quotations. If fewer
than two quotations are provided as requested, the rate for that date will be
determined on the basis of the rates quoted for loans in Dollars to leading
European banks for a period of time comparable to such Interest Period offered
by major banks in New York City at approximately 11:00 a.m. New York City time,
on the second Eurodollar Business Day prior to the first day of such Interest
Period. In the event that the Administrative Agent is unable to obtain any



 - 9 -









 





such quotation as provided above, it will be deemed that a Eurodollar Rate
pursuant to a Eurodollar Rate Loan cannot be determined.



     Eurodollar Rate Loans. Revolving Credit Loans and all or any portion of
the Tranche B Term Loan bearing interest calculated by reference to the
Eurodollar Rate.



     Event of Default. See §14.1.



     Excluded Assets. (a) Real Estate other than (i) Real Estate located at
One Emmis Plaza, 40 Monument Circle, Indianapolis, Indiana 46204, (ii) Real
Estate of KHON-TV and KGMB-TV located at 88 Piikoi Street and 1534 Kapiolani
Boulevard, respectively, in Honolulu, Hawaii and (iii) owned Real Estate
acquired after the date hereof having a value in excess of $5,000,000 over
which the Administrative Agent requests a Lien, (b) LMA Agreements not required
to be assigned pursuant to §10.5.1(d)(ii)(B) hereof, (c) property subject to
Capitalized Leases and purchase money liens permitted hereunder if such
Capitalized Lease or purchase money agreement prohibits assignment or liens in
favor of the Administrative Agent and the Lenders to secure the Obligations on
the assets subject thereto (but solely to the extent that any such restriction
shall be enforceable under applicable law) without the consent of the lessor
thereof or other applicable party thereto, and (d) the non-material assets
described on Schedule 7.1 hereto or such other non-material assets as may be
approved in writing by the Administrative Agent.



     Excluded Subsidiaries. Collectively, (a) Emmis Enterprises, Inc., an
Indiana corporation, and each of its subsidiaries, (b) each subsidiary of Emmis
International Broadcasting Corporation other than Emmis Latin America
Broadcasting Corporation and Emmis South America Broadcasting Corporation and
Emmis Dutch Broadcasting Corporation, each a California corporation, (c) any
other subsidiary formed or acquired by Emmis International Broadcasting
Corporation following the date hereof 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, provided that no such subsidiary shall be an Excluded
Subsidiary if it is a “Guarantor” under and as defined in the Subordinated Note
Indenture or the equivalent under any indenture governing Subordinated Debt
(including, without limitation, the Refinancing Note Indenture), (d) Country
Sampler Stores LLC, an Illinois limited liability company and each of its
subsidiaries, (e) 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, and (f) any other subsidiary formed or acquired by
the Borrower or any of its subsidiaries following the date hereof and
designated as an Excluded Subsidiary by the Borrower upon prior written notice
to the Administrative Agent, provided that after giving effect to such
designation no Default of Event of Default is then continuing or is projected
to occur under §11. Notwithstanding the foregoing, no Person may be an
Excluded Subsidiary hereunder if it is a “Guarantor” under and as defined in
the Subordinated Note Indenture or the equivalent under any indenture governing
Subordinated Debt (including, without limitation, the Refinancing Note
Indenture) or has otherwise guaranteed or given assurances of payment or
performance under or in respect of any Indebtedness (including Subordinated
Debt) of the Parent, the Borrower or any of the Subsidiaries.



     Excluded Taxes. See §6.3.2.



     Existing Credit Agreement. That certain Fourth Amended and Restated
Revolving Credit and Term Loan Agreement, dated as of December 29, 2000, as
amended and in effect on the Closing Date, by and among the Borrower, the
lending institutions party thereto, Toronto Dominion (Texas), Inc., as
administrative agent, Fleet National Bank, as documentation agent, Wachovia
Bank, National Association, as syndication agent and Credit Suisse First
Boston, as co-documentation agent.



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



 - 10 -









 





     FCC License. Any license, permit, certificate of compliance, antenna
structure registration, franchise, approval or authorization granted or issued
by the FCC.



     Fees. Collectively, the Commitment Fee, the Letter of Credit Fees, the
Administrative Agent’s Fee and any other fees that the Borrower may, after the
date hereof, agree in writing to pay to the Lenders or the Agents in connection
with this Credit Agreement.



     Financial Affiliate. 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).



     Fixed Charge Coverage Ratio. At any date of determination, the ratio of
(a) Consolidated Operating Cash Flow for the Reference Period most recently
ended to (b) Consolidated Fixed Charges for the Reference Period most recently
ended.



     Fund. Any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.



     Funding Date. The first date on which the conditions set forth in §12
have been satisfied and any Revolving Credit Loans and the Term Loans are to be
made or any Letter of Credit is to be issued hereunder.



     GAAP. (a) When used in §11, whether directly or indirectly through
reference to a capitalized term used therein, means (i) principles that are
consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, in effect for the fiscal year
ended on the Balance Sheet Date, and (ii) to the extent consistent with such
principles, the accounting practice of the Borrower reflected in its financial
statements for the year ended on the Balance Sheet Date, and (b) when used in
general, other than as provided above, means principles that are (i) consistent
with the principles promulgated or adopted by the Financial Accounting
Standards Board and its predecessors, as in effect from time to time, and (ii)
consistently applied with past financial statements of the Borrower adopting
the same principles, provided that in each case referred to in this definition
of “GAAP” a certified public accountant would, insofar as the use of such
accounting principles is pertinent, be in a position to deliver an unqualified
opinion (other than a qualification regarding changes in GAAP) as to financial
statements in which such principles have been properly applied.
Notwithstanding the foregoing, if at any time any change in GAAP would affect
the computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Required Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good
faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of the
Required Lenders); provided that, until so amended, (a) such ratio or
requirement shall continue to be computed in accordance with GAAP prior to such
change therein and (b) the Borrower shall provide to the Administrative Agent
and the Lenders financial statements and other documents required under this
Credit Agreement or as reasonably requested hereunder setting forth a
reconciliation between calculations of such ratio or requirement made before
and after giving effect to such change in GAAP.



     Governing Documents. With respect to any Person, its certificate or
articles of incorporation, membership agreement, partnership agreement or
similar charter document, any by-laws and all shareholder agreements, voting
trusts and similar arrangements applicable to any of its Capital Stock.



     Governmental Authority. Any foreign, federal, state, regional, local,
municipal or other government, or any department, commission, board, bureau,
agency, public authority or instrumentality thereof, or any court or
arbitrator, including, without limitation, the FCC.



 - 11 -









 





     Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of §3(2) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate the benefits of which are guaranteed on termination in full or
in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.



     Guaranty. The Guaranty, dated or to be dated as of the date hereof, made
by the Parent and each of the Subsidiaries in favor of the Lenders and the
Administrative Agent pursuant to which the Parent and each such Subsidiary
guaranties to the Lenders and the Administrative Agent the payment and
performance of the Obligations in form and substance satisfactory to the
Administrative Agent.



     Hazardous Substances. See §8.18(b).



     HoldCo Corporate Overhead Expenses. Means (i) fees payable to the trustee
under the Senior Discount Note Indenture, (ii) 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, (iii) SEC filing fees and expenses, (iv) legal fees relating to
the corporate maintenance of the Parent, (v) outside director fees, (vi) costs
and expenses payable for director and officer insurance, (vii) transfer agent
fees payable in connection with Capital Stock of the Parent, (viii) proxy
solicitation costs, (ix) franchise taxes and other fees payable to the
jurisdictions of incorporation or qualification of the Parent and (x) other
similar costs and expenses of the Parent incurred in the ordinary course of
conducting its business; provided, that in no event shall HoldCo Corporate
Overhead Expenses include (i) management fees, salaries, bonuses, debt service
and dividends and other distributions in respect of the Capital Stock of the
Parent or (ii) costs and expenses incurred by the Parent in connection with any
actual or proposed issuance of indebtedness or equity by the Parent which is
permitted hereunder.



     Indebtedness. As to any Person and whether recourse is secured by or is
otherwise available against all or only a portion of the assets of such Person
and whether or not contingent, but without duplication:




     (a) every obligation of such Person for money borrowed,




     (b) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, including obligations incurred in
connection with the acquisition of property, assets or businesses,




     (c) every reimbursement obligation of such Person with respect to
letters of credit, bankers’ acceptances or similar facilities issued for
the account of such Person,




     (d) every obligation of such Person issued or assumed as the
deferred purchase price of property or services (including securities
repurchase agreements but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business which are not
overdue or which are being contested in good faith),




     (e) every obligation of such Person under any Capitalized Lease,




     (f) every obligation of such Person under any Synthetic Lease,




     (g) all sales by such Person of (i) accounts or general intangibles
for money due or to become due, (ii) chattel paper, instruments or
documents creating or evidencing a right to payment of money or (iii)
other receivables (collectively “receivables”), whether pursuant to a
purchase facility or otherwise, other than in connection with the
disposition of the business operations of such Person relating thereto or
a disposition of defaulted receivables for collection and not as a
financing arrangement, and together with any obligation of such Person to
pay any



 - 12 -









 






     discount, interest, fees, indemnities, penalties, recourse,
expenses or other amounts in connection therewith,




     (h) every obligation of such Person (an “equity related purchase
obligation”) to purchase, redeem, retire or otherwise acquire for value
any shares of Capital Stock issued by such Person or any rights measured
by the value of such Capital Stock,




     (i) every net obligation of such Person under any forward contract,
futures contract, swap, option or other financing agreement or
arrangement (including, without limitation, caps, floors, collars and
similar agreements), the value of which is dependent upon interest rates,
currency exchange rates, commodities or other indices (a “derivative
contract”),




     (j) every obligation in respect of Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to
the extent that 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 that the terms of such Indebtedness provide that
such Person is not liable therefor and such terms are enforceable under
applicable law,




     (k) every obligation, contingent or otherwise, of such Person
guaranteeing, or having the economic effect of guarantying or otherwise
acting as surety for, any obligation of a type described in any of
clauses (a) through (j) (the “primary obligation”) of another Person (the
“primary obligor”), in any manner, whether directly or indirectly, and
including, without limitation, any obligation of such Person (i) to
purchase or pay (or advance or supply funds for the purchase of) any
security for the payment of such primary obligation, (ii) to purchase
property, securities or services for the purpose of assuring the payment
of such primary obligation, or (iii) to maintain working capital, equity
capital or other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such primary
obligation.



     The “amount” or “principal amount” of any Indebtedness at any time of
determination represented by (u) any Indebtedness, issued at a price that is
less than the principal amount at maturity thereof, shall be the amount of the
liability in respect thereof determined in accordance with GAAP, (v) any
Capitalized Lease shall be the principal component of the aggregate of the
rentals obligation under such Capitalized Lease payable over the term thereof
that is not subject to termination by the lessee, (w) any sale of receivables
shall be the amount of unrecovered capital or principal investment of the
purchaser (other than the Borrower or any of its wholly-owned Subsidiaries)
thereof, excluding amounts representative of yield or interest earned on such
investment, (x) any Synthetic Lease shall be the stipulated loss value,
termination value or other equivalent amount, (y) any derivative contract shall
be the maximum amount of any termination or loss payment required to be paid by
such Person if such derivative contract were, at the time of determination, to
be terminated by reason of any event of default or early termination event
thereunder, whether or not such event of default or early termination event has
in fact occurred and (z) any equity related purchase obligation shall be the
maximum fixed redemption or purchase price thereof inclusive of any accrued and
unpaid dividends to be comprised in such redemption or purchase price.



     Indemnified Liabilities. See §18.3.



     Indemnified Person. See §18.3.



     Ineligible Securities. 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.



     Instrument of Accession. See §15.1.



 - 13 -









 





     Interest Coverage Ratio. At any date of determination, the ratio of (a)
Consolidated Operating Cash Flow for the Reference Period most recently ended
to (b) Consolidated Total Interest Expense for such Reference Period.



     Interest Payment Date. (a) As to any Base Rate Loan, the last day of the
calendar quarter with respect to interest accrued during such calendar quarter,
including, without limitation, the calendar quarter which includes the Drawdown
Date of such Base Rate Loan; and (b) as to any Eurodollar Rate Loan in respect
of which the Interest Period is (i) three months or less, the last day of such
Interest Period and (ii) more than three (3) months, the respective dates that fall every three
months after the beginning of such Interest Period.



     Interest Period. With respect to each Revolving Credit Loan or all or any
relevant portion of the Tranche B Term Loan (a) that is a Eurodollar Rate Loan,
initially, the period commencing on the Drawdown Date of such Loan and ending
on the last day of a period consisting of one (1), two (2), three (3) or six
(6) months, and if acceptable to all Lenders within the relevant Tranche, nine
(9) or twelve (12) months, as selected by the Borrower in a Loan Request or as
otherwise required by the terms of this Credit Agreement, and (b) thereafter,
each period commencing on the last day of the next preceding Interest Period
applicable to such Revolving Credit Loan or all or such portion of the Tranche
B Term Loan and ending on the last day of one of the periods set forth above,
as selected by the Borrower in a Conversion Request; provided that all of the
foregoing provisions relating to Interest Periods are subject to the following:




     (A) if any Interest Period with respect to a Eurodollar Rate Loan
would otherwise end on a day that is not a Eurodollar Business Day, that
Interest Period shall be extended to the next succeeding Eurodollar
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such Interest
Period shall end on the immediately preceding Eurodollar Business Day;




     (B) if the Borrower shall fail to give notice as provided in §2.7 or
§3.5.2, the Borrower shall be deemed to have requested a conversion of
the affected Eurodollar Rate Loan to a Base Rate Loan and the continuance
of all Base Rate Loans as Base Rate Loans on the last day of the then
current Interest Period with respect thereto;




     (C) any Interest Period relating to any Eurodollar Rate Loan that
begins on the last Eurodollar Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last
Eurodollar Business Day of a calendar month; and




     (D) any Interest Period that would otherwise extend beyond the
Revolving Credit Loan Maturity Date (if comprising a Revolving Credit
Loan) or the Tranche B Maturity Date (if comprising the Tranche B Term
Loan or a portion thereof) shall end on the Revolving Credit Loan
Maturity Date or the Tranche B Maturity Date, as the case may be.



     Interest Rate Agreement. Any interest rate swap agreement (whether from
fixed to floating or from floating to fixed), interest rate cap agreement,
interest rate collar agreement, interest rate futures contract, interest rate
option agreement or other similar agreement or arrangement to which the
Borrower and any Lender or Affiliate of any Lender is a party, designed to
manage interest rates or interest rate risk in connection with this Credit
Agreement, the Refinancing Notes or any other Indebtedness for borrowed money
evidenced by bonds, debentures or other similar instruments owed by the
Borrower or any of its Subsidiaries.



     Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of Capital Stock or
Indebtedness of, or for loans, advances, capital contributions or transfers of
property to, or in respect of any guaranties (or other commitments as described
under the definition of



 - 14 -









 





Indebtedness), or obligations of, any Person, but
excluding accrued interest or earnings thereon. In determining the aggregate
amount of Investments outstanding at any particular time: (a) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (b) there
shall be deducted in respect of each such Investment any amount received as a
return of capital (but only by repurchase, redemption, retirement, repayment,
liquidating dividend or liquidating distribution); (c) there shall not be
deducted in respect of any Investment any amounts received as earnings on such
Investment, whether as dividends, interest or otherwise, and (d) there shall
not be deducted from the aggregate amount of Investments any decrease in the
value thereof.







     Lead Arrangers. Collectively, Banc of America Securities LLC, Goldman
Sachs Credit Partners L.P. and Wachovia Capital Markets, LLC acting as joint
lead arrangers and joint book managers.



     Lender Affiliate. (a) With respect to any Lender, (i) an Affiliate of
such Lender or (ii) an Approved Fund and (b) with respect to an Approved Fund,
any other entity (whether a corporation, partnership, limited liability
company, trust or other legal entity) that is a fund that invests in bank loans
and similar extensions of credit and is managed by the same investment advisor
as such Approved Fund or by an Affiliate of such investment advisor.



     Lenders. Collectively, the Revolving Credit Lenders and the Tranche B
Lenders and any institution that becomes a Lender pursuant to §15 or §17.



     Letter of Credit. See §5.1.1.



     Letter of Credit Application. See §5.1.1.



     Letter of Credit Fee. See §5.6.



     Letter of Credit Participation. See §5.1.4.



     License Subsidiaries. Collectively, (a) Emmis License Corporation, Emmis
License Corporation of New York, Emmis Radio License Corporation, Emmis Radio
License Corporation of New York, Emmis Television License Corporation, Emmis
Television License Corporation of Wichita, Emmis Television License Corporation
of Topeka, and (b) any new Subsidiaries that hold licenses to broadcast or
transmit radio or television signals formed or acquired in connection with any
Permitted Acquisition, or any internal reorganization permitted pursuant to
§10.5.1(a).



     Lien. Any mortgage, deed of trust, security interest, pledge,
hypothecation, assignment, attachment, deposit arrangement, encumbrance, lien
(statutory, judgment or otherwise), or other security agreement or preferential
arrangement of any kind or nature whatsoever (including any conditional sale or
other title retention agreement, any Capitalized Lease, any Synthetic Lease,
any financing lease involving substantially the same economic effect as any of
the foregoing and the filing of any financing statement under the UCC or
comparable law of any jurisdiction and with respect to stock, a Person’s right
to acquire such stock).



     LMA Agreement. Any time brokerage agreement, local marketing agreement or
related or similar agreements pursuant to which a Person acquires the right to
program substantially all of the time and to sell all of the advertising spots
of a Station owned by another non-affiliated person in exchange for cash
payment, entered into, directly or indirectly, between the Borrower or any of
its Subsidiaries and any Person other than the Parent, the Borrower or any of
its Subsidiaries or their respective Affiliates.



     Loan Documents. Collectively, this Credit Agreement, the Notes (if any),
the Letter of Credit Applications, the Security Documents and any other
documents, agreements or instruments contemplated hereby or thereby or executed
by the Parent, the Borrower or a Subsidiary in connection herewith or
therewith.




 - 15 -









 





     Loan Request. See §2.6.



     Loans. Collectively, the Revolving Credit Loans and the Tranche B Term
Loan and for purposes of §15 only, any new loan provided to the Borrower in
accordance with the terms and conditions set forth in such §15.



     Material Adverse Effect. With respect to any event or occurrence of
whatever nature (including any adverse determination in any litigation,
arbitration or governmental investigation or proceeding):




     (a) a material adverse effect on the business, properties, condition
(financial or otherwise), assets, operations or income of the Parent and
its Subsidiaries, taken as a whole;




     (b) a material adverse effect on the ability of the Parent or the
Borrower individually or the Parent and its Subsidiaries, taken as a
whole, to perform any of their respective Obligations under any of the
Loan Documents to which it is a party; or




     (c) any impairment of the validity, binding effect or enforceability
of this Credit Agreement or any of the other Loan Documents, any material
impairment of the rights, remedies or benefits available to the
Administrative Agent or any Lender under any Loan Document or any
impairment of the attachment, perfection or priority of any Lien of the
Administrative Agent under the Security Documents.



     Maximum Drawing Amount. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Letters of Credit, as such
aggregate amount may be reduced from time to time pursuant to the terms of the
Letters of Credit.



     Moody’s. Moody’s Investors Services, Inc.



     Mortgaged Property. Any Real Estate which is subject to any Mortgage.



     Mortgages. The mortgages and deeds of trust from the Borrower and/or its
Subsidiaries to the Administrative Agent with respect to the fee and leasehold
interests of the Borrower and its Subsidiaries in certain Real Estate and in
form and substance satisfactory to the Administrative Agent.



     Multiemployer Plan. Any multiemployer plan within the meaning of §3(37)
of ERISA maintained or contributed to by the Borrower or any ERISA Affiliate.



     Necessary Authorization. Any license, permit, consent, franchise, order,
approval or authorization from, or any filing, recording or registration with,
any Governmental Authority (including without limitation the FCC) necessary to
the conduct of any business of the Borrower or any of its Subsidiaries or for
the ownership, maintenance and operation by such Person of its Stations and
other properties or to the performance by such Person of its obligations under
any LMA Agreement.



     Net Cash Equity Issuance Proceeds. With respect to any Equity Issuance,
the excess of the gross cash proceeds received by the issuer for such Equity
Issuance after deduction of all reasonable and customary transaction expenses
(including, without limitation, underwriting discounts and commissions)
actually incurred in connection with such issuance.



     Net Cash Sale Proceeds. The gross cash proceeds received by the Parent or
any of its Subsidiaries in respect of any Asset Sale or Asset Swap, minus the
sum of (a) all reasonable out-of-pocket fees, commissions and other reasonable
and customary direct expenses actually incurred in connection with such Asset
Sale or Asset Swap, including the amount of any transfer or documentary taxes
required to be paid by such Person in connection with such Asset Sale or Asset
Swap, plus (b) the aggregate amount of cash so received by such Person which is
required to be used to retire (in whole or in part) any Indebtedness (other



 - 16 -









 





than under the Loan Documents) of such Person permitted by this Credit
Agreement that was secured by a lien or security interest permitted by this
Credit Agreement having priority over the liens and security interests (if any)
of the Administrative Agent (for the benefit of the Administrative Agent and
the Lenders) with respect to such assets transferred and which is required to
be repaid in whole or in part (which repayment, in the case of any other
revolving credit arrangement or multiple advance arrangement, reduces any
commitment thereunder) in connection with such Asset Sale or Asset Swap, plus
(c) any cash reserve in an amount reasonably determined by the Borrower to be
necessary in connection with indemnification obligations or potential
post-closing purchase price adjustments relating to such Asset Sale or Asset
Swap so long as the Administrative Agent holds such cash reserve amount as cash
collateral pursuant to §4.6 hereof and the Borrower provides to the Administrative Agent an accounting
of such proceeds reasonably satisfactory to the Administrative Agent. If the
Parent or any of its Subsidiaries receives any promissory notes or other
instruments as part of the consideration for such Asset Sale or Asset Swap or
if payment in cash of any portion of the consideration for such Asset Sale or
Asset Swap is otherwise deferred or if the amount previously held as a cash
reserve for indemnification obligations or purchase price adjustments is
reduced, Net Cash Sale Proceeds shall be deemed to include any cash payments in
respect of such notes or instruments or otherwise deferred portion of such
consideration when and to the extent received by such Person.



     Non-Excluded Taxes. See §6.3.2.



     Notes. Collectively, the Revolving Credit Notes, the Tranche B Term Notes
and any promissory notes of the Borrower evidencing a new Loan to the Borrower
advanced in accordance with the terms and conditions set forth in §15.



     Obligations. All indebtedness, obligations and liabilities of any of the
Parent, the Borrower and its Subsidiaries to any of the Lenders or any of the
Agents, individually or collectively, existing on the date of this Credit
Agreement or arising thereafter, direct or indirect, joint or several, absolute
or contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, arising or
incurred under or in connection with this Credit Agreement or any of the other
Loan Documents or any of the Loans made or Reimbursement Obligations incurred
or any of the Notes, Letter of Credit Applications, Letters of Credit or other
instruments at any time evidencing any thereof or any Interest Rate Agreement
(a) required to be maintained pursuant to the terms of this Credit Agreement
(or otherwise maintained in respect of Loans made hereunder) or (b) in respect
of the Refinancing Notes or any other Indebtedness for borrowed money evidenced
by bonds, debentures or other similar instruments owed by the Borrower or any
of its Subsidiaries. This term includes, without limitation, all interest that
accrues after the commencement of any case or proceeding by or against any
credit party in bankruptcy whether or not allowed in such case or proceeding.



     Operating Subsidiaries. Collectively, (a) Emmis Radio Corporation, Emmis
Meadowlands Corporation, Emmis Publishing Corporation, Mediatex Communications
Corporation and Los Angeles Magazine Holding Company, Inc., each an Indiana
corporation; (b) SJL of Kansas Corporation, a Kansas corporation; (c) Topeka
Television Corporation, a Missouri corporation; (d) Emmis International
Broadcasting Corporation, Emmis Latin America Broadcasting Corporation, Emmis
South America Broadcasting Corporation and Emmis Dutch Broadcasting
Corporation, each a California corporation; (e) the Partnership Subsidiaries
and their successors; and (f) any new Subsidiaries acquired in connection with
any Permitted Acquisition or any internal reorganization permitted pursuant to
§10.5.1(a) used to hold assets (other than broadcast licenses) used in
connection with, and to conduct operations of, any Station.



     outstanding. With respect to the Loans, the aggregate unpaid principal
thereof as of any date of determination.



     Parent. Emmis Communications Corporation, an Indiana corporation.



 - 17 -









 





     Partnership Subsidiaries. Collectively, Emmis Indiana Broadcasting, L.P.,
Emmis Publishing, L.P. and Emmis Television Broadcasting, L.P., each an Indiana
limited partnership.



     PBGC. The Pension Benefit Guaranty Corporation created by §4002 of ERISA
and any successor entity or entities having similar responsibilities.



     Perfection Certificates. The Perfection Certificates as defined in the
Security Agreements.



     Permitted Acquisition. Any acquisition permitted under §10.5.1.



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



     Permitted Liens. Liens permitted by §10.2.



     Person. Any individual, corporation, limited liability company,
partnership, limited liability partnership, trust, other unincorporated
association, business, or other legal entity, and any Governmental Authority.



     Pledge Agreement. The Pledge Agreement, dated or to be dated as of the
date hereof, by and among the Parent, the Borrower and each of the Subsidiaries
and the Administrative Agent, in form and substance satisfactory to the
Administrative Agent.



     Pro Forma Basis. In connection with any proposed Permitted Acquisition,
(including acquisitions contemplated in connection with an LMA Agreement),
Asset Sale or Asset Swap, the calculation of compliance with the financial
covenants set forth in §11 by the Borrower and its Subsidiaries (after
including the business, business division or Person to be acquired in
connection with any Permitted Acquisition or Asset Swap as if such business,
business division or Person were a Subsidiary and after excluding any business,
business division or Person to be sold or otherwise disposed of in connection
with any Asset Sale or Asset Swap). The calculation of such compliance shall
be determined as of the most recently ended Reference Period by reference to
the financial results of the Borrower and its Subsidiaries for such Reference
Period after adjusting the same to (i) exclude the financial results
attributable to any business, business division or Person to be sold or
otherwise disposed of as if such transaction occurred on the first day of such
Reference Period and (ii) include the audited financial results of any
business, business division or Person to be acquired, if available for such
Reference Period, or if such audited financial results are not available for
such Reference Period, 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 Permitted Acquisition or
Asset Swap had occurred on the first day of such Reference Period and including
the adjustments described in clauses (a), (b), (c) and (d) below. Following a
Permitted Acquisition, Asset Sale or Asset Swap, the calculation of compliance
with the covenants set forth in §11 for any Reference Period which contains the
fiscal quarter in which such Permitted Acquisition, Asset Sale or Asset Swap
occurred shall be calculated in the manner set forth above for any portion of
the then applicable Reference Period which occurred prior to the date of such
transaction including the adjustments described in clauses (a), (b), (c) and
(d) below:




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



 - 18 -









 






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




     (c) for purposes of calculating Consolidated Operating Cash Flow for
the Reference Period, 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 Permitted Acquisition (including the
amount of any pre-acquisition management fees paid during such period in
connection with the operation of any Station subject to such Permitted
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 Reference Period, provided that the Administrative Agent shall be
under no obligation to approve such cost savings, expenses or other
adjustments;




     (d) for purposes of calculating Consolidated Operating Cash Flow for
the Reference Period, with respect to any Permitted Acquisition or Asset
Swap, Consolidated Net Income (or Deficit) shall be increased by (i) the
amount of any bad debt reserve adjustment associated with any accounts
receivable on the books of such acquired Station on the date of
acquisition thereof to the extent that such accounts receivable are not
acquired by the Borrower or any of such Subsidiaries, and (ii) the amount
of any bad debt reserve adjustment associated with any accounts
receivable on the books of such acquired Station on the date of
acquisition thereof and which are acquired by the Borrower or any of such
Subsidiaries to the extent such bad debt reserve adjustment exceeds the
amount the Borrower would have reserved with respect to such accounts
receivable in accordance with its customary reserve practices.



     Program. Any television series or other program produced or distributed
for television, or film or video release (including any syndicated series or
other program regardless of its medium of initial exploitation), in each case
whether recorded on film, videotape, audio tape, cassette, cartridge, disc or
by any other means, method, process or device, whether now known or hereafter
developed.



     Program Contracts. All contracts for television and film, Programs, music
and related audio rights and syndicated series exhibition rights acquired under
license agreements.



     Program Rights. Any right whether arising under Program Contracts or
otherwise, to sell, distribute, subdistribute, exhibit, lease, sublease,
license, sublicense or otherwise exploit Programs.



     Program Rights Costs. The maximum amount which the Borrower and/or any of
its Subsidiaries or its or their co-venturers have furnished or have
contractually committed to furnish (whether or not such commitments shall be
reflected as an asset or liability on the consolidated balance sheet of the
Borrower) toward the production or acquisition by the Borrower and/or any of
its Subsidiaries or its or their co-venturers in connection with any Program
Rights with respect to any Program.



     Programming Amortization Expense. For any period, total amortization
expense of the Borrower and its Subsidiaries for such period which is directly
attributable to Programs, Program Rights or Program Contracts, determined on a
consolidated basis in accordance with GAAP.



     Programming Cash Payments. For any period, the aggregate cash payments
actually made by Borrower and its Subsidiaries during such period in respect of
Programming Obligations, determined on a consolidated basis in conformity with
GAAP.



 - 19 -









 





     Programming Obligations. For any period, all direct or indirect
liabilities (including, but without duplication, any guaranties and other
contingent obligations relating to or arising in connection with a Programming
Obligation), contingent or otherwise, with respect to Program Contracts,
Programs or Program Rights, (including, without limitation, all Program Rights
Costs) of the Borrower and/or its Subsidiaries whether or not reflected on the
consolidated balance sheet of the Borrower and its subsidiaries prepared in
conformity with GAAP.



     Projections. See §8.4.3.



     RAM. 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.



     Real Estate. All real property at any time owned or leased (as lessee or
sublessee) by the Borrower or any of its Subsidiaries.



     Reference Period. As of any date of determination, the period of four (4)
consecutive fiscal quarters of the Borrower and its Subsidiaries ending on such
date, or if such date is not a fiscal quarter end date, the period of four (4)
consecutive fiscal quarters most recently ended (in each case treated as a
single accounting period).



     Refinancing Note Documents. Each of the documents, instruments and other
agreements entered into or delivered by the Borrower (including, without
limitation, the Refinancing Notes and the Refinancing Note Indenture) and/or
any Subsidiary of the Borrower relating to the issuance by the Borrower of the
Refinancing Notes and any guaranties or other documents related thereto, each
in form and substance reasonably satisfactory to the Administrative Agent, as
the same may be supplemented, amended or modified from time to time in
accordance with the terms hereof (including, without limitation, §10.8) and
thereof.



     Refinancing Note Indenture. The indenture between the Borrower and The
Bank of Nova Scotia Trust Company of New York which governs the Refinancing
Notes and contains materials, terms and conditions which are less restrictive
than the terms and conditions of this Credit Agreement and otherwise in form
and substance reasonably satisfactory to the Administrative Agent, as the same
may be supplemented, amended or modified from time to time in accordance with
the terms hereof (including §10.8) and thereof.



     Refinancing Notes. The Borrower’s unsecured 6-7/8% subordinated notes due
2012 issued by the Borrower under the Refinancing Note Indenture, the proceeds
of which shall be used in accordance with §9.16.



     Register. See §17.2.



     Reimbursement Obligation. The Borrower’s obligation to reimburse the
Administrative Agent and the Revolving Credit Lenders on account of any drawing
under any Letter of Credit as provided in §5.2.



     Related Parties. With respect to any Person, such Person’s Affiliates and
the partners, directors, officers, employees, agents and advisors of such
Person and of such Person’s Affiliates.



     Required Lenders. As of any date, the Lenders (other than Delinquent
Lenders) holding greater than fifty percent (50%) of the sum of (i) the
aggregate outstanding principal amount of the Tranche B Term Loans on such
date, and (ii) the Total Revolving Credit Commitment on such date, or, in the
event that the Total Revolving Credit Commitment has been terminated or
otherwise reduced to zero, the outstanding principal amount of Revolving Credit
Loans on such date, and (iii) the aggregate outstanding principal amount on
such date of any new Tranche structured as a term tranche pursuant to §15.1.



 - 20 -









 





     Required Revolver Lenders. As of any date, the Revolving Credit Lenders
(other than Delinquent Lenders) holding greater than fifty percent (50%) of the
Total Revolving Credit Commitment on such date, or, in the event that the Total
Revolving Credit Commitment has been terminated or otherwise reduced to zero,
the outstanding principal amount of Revolving Credit Loans on such date.



     Required Term Lenders. As of any date, the Tranche B Lenders and (as
applicable) the Lenders of any new Tranche structured as a term tranche
pursuant to §15.1 (other than, in each case Delinquent Lenders) holding greater
than fifty percent (50%) of the sum of (i) the aggregate outstanding principal
amount of the Tranche B Term Loans on such date, and (ii) the aggregate
outstanding principal amount on such date of any new Tranche structured as a
term tranche pursuant to §15.1.



     Restricted Payment. In relation to the Borrower and its Subsidiaries, any
(a) Distribution, (b) payment in respect of Subordinated Debt (including
Additional Subordinated Debt), (c) payment of management, consulting or similar
fees to Affiliates of the Borrower or such Subsidiary, or (d) derivatives or
other transactions with any financial institution, commodities or stock
exchange or clearinghouse (a “Derivatives Counterparty”) obligating the
Borrower or such Subsidiary to make payments to such Derivatives Counterparty
as a result of any change in market value of any Capital Stock of the Borrower
or such Subsidiary.



     Revolving Credit Commitment. With respect to each Revolving Credit
Lender, the amount set forth on Schedule 1 hereto (as adjusted from time to
time pursuant to §§15 and/or 17) as the amount of such Revolving Credit
Lender’s commitment to make Revolving Credit Loans to, and to participate in
the issuance, extension and renewal of Letters of Credit for the account of,
the Borrower, as the same may be reduced or increased from time to time
pursuant to §15 or §17 hereof; or if such commitment is terminated pursuant to
the provisions hereof, zero.



     Revolving Credit Lenders. Each Lender which has a Revolving Credit
Commitment set forth opposite its name on Schedule 1 hereto and any other
Person who becomes an assignee of any rights and obligations of a Revolving
Credit Lender pursuant to §17 or who agrees to advance additional Revolving
Credit Loans pursuant to §15.



     Revolving Credit Loan Maturity Date. November 10, 2011.



     Revolving Credit Loans. Revolving credit loans made or to be made by the
Revolving Credit Lenders to the Borrower pursuant to §2.



     Revolving Credit Notes. See §2.4.



     Security Agreement. The Security Agreement, dated or to be dated as of
the date hereof, between the Borrower and each of the Subsidiaries and the
Administrative Agent, in form and substance satisfactory to the Administrative
Agent.



     Security Documents. The Guaranty, the Security Agreement, the Mortgages,
the Trademark Agreement, the Copyright Mortgage, the Pledge Agreement, the
Collateral Assignments of Contracts and all other instruments and documents,
including without limitation UCC financing statements, required to be executed
or delivered pursuant to any Security Document.



     Senior Discount Note Indenture. The Indenture, dated as of March 27,
2001, by and between the Parent (as successor by merger to Emmis Escrow
Corporation) and United States Trust Company of New York, as trustee
thereunder, with respect to the Senior Discount Notes, as in effect on March
27, 2001 and as the same may be supplemented, amended or modified from time to
time in accordance with the terms hereof (including, without limitation, §10.8
to the extent applicable) and thereof.



 - 21 -









 





     Senior Discount Notes. The 12-1/2% Senior Discount Notes Due 2011 issued
by the Parent (as successor by merger to Emmis Escrow Corporation) under the
Senior Discount Note Indenture, and any refinancings thereof.



     Senior Funded Debt. At any time of determination, Consolidated Total
Funded Debt minus Subordinated Debt.



     Senior Leverage Ratio. At any time of determination, the ratio of (a)
Senior Funded Debt as at such date to (b) Consolidated Operating Cash Flow for
the Reference Period ending on such date.



     Settlement. The making or receiving of payments, in immediately available
funds, by the Revolving Credit Lenders, to the extent necessary to cause each
Revolving Credit Lender’s actual share of the outstanding amount of Revolving
Credit Loans (after giving effect to any Loan Request) to be equal to such
Revolving Credit Lender’s Commitment Percentage of the outstanding amount of
such Revolving Credit Loans (after giving effect to any Loan Request), in any
case where, prior to such event or action, the actual share is not so equal.



     Settlement Amount. See §2.9.1.



     Settlement Date. (a) The Drawdown Date relating to any Loan Request, (b)
Friday of each week, or if a Friday is not a Business Day, the Business Day
immediately following such Friday, (c) at the option of the Administrative
Agent, on any Business Day following a day on which the account officers of the
Administrative Agent active upon the Borrower’s account become aware of the
existence of an Event of Default, (d) any Business Day on which the amount of
Revolving Credit Loans outstanding from Bank of America plus Bank of America’s
Commitment Percentage of the sum of the Maximum Drawing Amount and any Unpaid
Reimbursement Obligations is equal to or greater than Bank of America’s
Commitment Percentage of the Total Revolving Credit Commitment, (e) the
Business Day immediately following any Business Day on which the amount of
Revolving Credit Loans outstanding increases or decreases by more than
$2,000,000 as compared to the previous Settlement Date, (f) any day on which
any conversion of a Base Rate Loan to a Eurodollar Rate Loan occurs, or (g) any
Business Day on which the amount of outstanding Revolving Credit Loans
decreases.



     Settling Lender. See §2.9.1.



     Sinclair Definitive Agreement. That certain Agreement for Purchase of
Limited Partner and Member Interests, dated as of March 3, 2003, between
Sinclair Telecable, Inc. and the Borrower, together with all other agreements
and documents entered into or delivered pursuant to or in connection therewith,
relating to the Austin Investment and the governance of, or operation of the
business of, the Austin Partnership thereafter.



     Solvent. With respect to any Person as of any date of determination, (a)
the fair value of the property of such Person (both at fair valuation and at
present fair saleable value) is greater than the total amount of liabilities,
including contingent liabilities, of such Person, (b) the present fair saleable
value of the assets of such Person is not less than the amount that will be
required to pay the probable liabilities of such Person on its debts as they
become absolute and matured, (c) such Person is able to realize upon its assets
and pay its debts and other liabilities, contingent obligations and other
commitments as they mature in the normal course of business, (d) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay as such debts and liabilities
mature, and (e) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person’s
property would constitute unreasonably small capital after giving due
consideration to current and anticipated future capital requirements and
current and anticipated future business conduct and the prevailing practice in
the industry in which such Person is engaged. In computing the amount of
contingent liabilities at any time, such liabilities shall be computed in an
amount which, in light of the facts



 - 22 -









 





and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability.



     S&P. Standard & Poor’s Ratings Group.



     Station. All of the properties, assets and operating rights constituting
a system for transmitting radio or television signals from a transmitter
licensed by the FCC, together with any subsystem which is ancillary to such
system and including all the Stations set forth on Schedule 8.3(b) hereto.



     Subordinated Debt. Collectively, (a) the Subordinated Notes, the
Refinancing Notes and the Subordinated Guaranties and (b) any other unsecured
Indebtedness (including guaranties by Subsidiaries of
such unsecured Indebtedness) issued by the Borrower or any Subsidiary
after the Funding Date that is expressly subordinated and made junior to the
payment and performance in full in cash of the Obligations, and evidenced as
such by a written instrument containing subordination provisions in form and
substance reasonably satisfactory to the Administrative Agent and approved by
the Administrative Agent in writing (“Additional Subordinated Debt”); provided
that the material terms and conditions of such Additional Subordinated Debt are
less restrictive than the terms and conditions set forth in this Credit
Agreement with respect to the Obligations and no more restrictive than the
terms and conditions of the Subordinated Notes and the Refinancing Notes (as
applicable) as reasonably determined by the Administrative Agent. For the
purposes of clarification, if any Additional Subordinated Debt has an interest
rate higher than the interest rate applicable to the Subordinated Notes or the
Refinancing Notes, such Additional Subordinated Debt shall not be deemed more
restrictive than the Subordinated Notes or the Refinancing Notes solely because
of such higher interest rate.



     Subordinated Guaranties. The guaranties of certain subsidiaries of the
Borrower of the obligations of the Borrower under the Subordinated Notes
pursuant to the Subordinated Note Indenture and the Refinancing Notes pursuant
to the Refinancing Note Indenture which, in each case, are subordinated to the
repayment of the Obligations in accordance with the terms of the Subordinated
Note Indenture and the Refinancing Note Indenture, respectively.



     Subordinated Note Documents. Each of the documents, instruments and other
agreements entered into or delivered by the Borrower (including, without
limitation, the Subordinated Notes and the Subordinated Note Indenture) and/or
any Subsidiary of the Borrower relating to the issuance by the Borrower of the
Subordinated Notes and any guaranties or other documents related thereto, as in
effect on February 12, 1999, and as the same may be supplemented, amended or
modified from time to time in accordance with the terms hereof (including,
without limitation, §10.8) and thereof.



     Subordinated Note Indenture. The Indenture, dated as of February 12,
1999, by and between the Borrower and Bank of New York (as successor to IBJ
Whitehall Bank & Trust Company), as trustee thereunder, with respect to the
Subordinated Notes, as in effect on February 12, 1999 and as the same may be
supplemented, amended or modified from time to time in accordance with the
terms hereof (including, without limitation, §10.8) and thereof.



     Subordinated Notes. The 8.125% Subordinated Notes due 2009 in the
aggregate principal amount of $300,000,000 issued by the Borrower under the
Subordinated Note Indenture.



     Subsidiary. Any corporation, association, trust, partnership, limited
liability company or other business entity of which the designated parent shall
at any time own directly or indirectly through a Subsidiary or Subsidiaries at
least a majority of the shares of Capital Stock or other interests having
ordinary voting power for the election of directors or other governing body
(other than securities or interests having such power only by reason of the
happening of a contingency). For purposes of this Credit Agreement, with
respect to the Parent, the Borrower or any of their respective Subsidiaries,
“Subsidiary” shall include all Subsidiaries of the Parent and the Borrower
other than Excluded Subsidiaries, except as otherwise expressly provided.



 - 23 -









 





     Syndication Agent. As defined in the preamble hereto.



     Synthetic Lease. Any lease of goods or other property, whether real or
personal, which is treated as an operating lease under GAAP and as a loan or
financing for U.S. income tax purposes.



     Title Insurance Company. With respect to each Mortgaged Property, as
applicable, Chicago Title Insurance Company and/or any other title insurance
company reasonably acceptable to the Administrative Agent, and collectively if
the context requires, all such companies.



     Title Policy. In relation to each Mortgaged Property, an ALTA standard
form title insurance policy issued by the Title Insurance Company (with such
reinsurance or co-insurance as the Administrative Agent may require, any such
reinsurance to be with direct access endorsements) in such amount as may be
reasonably determined by the Administrative Agent insuring the priority of the
Mortgage of such Mortgaged Property and that the Borrower or one of its
Subsidiaries holds marketable fee simple or leasehold title (as applicable) to
such Mortgaged Property, subject only to the encumbrances permitted by such
Mortgage and which shall not contain exceptions for mechanics liens, persons in
occupancy or matters which would be shown by a survey (except as may be
permitted by such Mortgage), shall not insure over any matter except to the
extent that any such affirmative insurance is acceptable to the Administrative
Agent in its sole discretion, and shall contain such endorsements and
affirmative insurance as the Administrative Agent in its discretion may
require, including but not limited to (a) comprehensive endorsement, (b)
variable rate of interest endorsement, (c) usury endorsement, (d) revolving
credit endorsement, (e) tie-in endorsement, (f) doing business endorsement and
(g) ALTA form 3.1 zoning endorsement.



     Total Commitment. The sum of (a) the Total Revolving Credit Commitment,
plus (b) the sum of the Tranche B Commitments of the Tranche B Lenders plus (c)
to the extent not otherwise included in the preceding clauses, the sum of the
commitments in respect of any new Tranche structured as a term tranche pursuant
to §15.1.



     Total Leverage Ratio. As at any date of determination, the ratio of (a)
Consolidated Total Funded Debt outstanding on such date to (b) Consolidated
Operating Cash Flow for the Reference Period ending on such date.



     Total Percentage. With respect to each Lender without duplication, the
sum of (a) the Tranche B Term Loan held by such Lender plus (b) the Revolving
Credit Commitment of such Lender (or, if such Revolving Credit Commitment has
been terminated, the Revolving Credit Loans, Letter of Credit Participations in
Unpaid Reimbursement Obligations, and participating interests in the risk
relating to outstanding Letters of Credit held by such Lender) plus (c) to the
extent not otherwise included in the foregoing, such Lender’s interest in any
new Tranche structured as a term tranche pursuant to §15.1 as a percentage of
the sum of (x) the outstanding principal amount of the Tranche B Term Loan plus
(y) the greater of (i) the Total Revolving Credit Commitment and (ii) the
outstanding principal amount of the Revolving Credit Loans, Unpaid
Reimbursement Obligations and the Maximum Drawing Amount of Letters of Credit
plus (z) the outstanding principal amount of any new Tranche structured as a
term tranche pursuant to §15.1.



     Total Revolving Credit Commitment. The sum of the Revolving Credit
Commitments of the Revolving Credit Lenders, as in effect from time to time,
which as of the Funding Date shall be equal to the aggregate principal amount
of $350,000,000, as such amount may be decreased from time to time pursuant to
the terms hereof or increased thereafter pursuant to the terms and conditions
set forth in §15.



     Trademark Agreement. The Trademark Collateral Security and Pledge
Agreement, dated or to be dated as of the date hereof, by and among the
Borrower and each of the Subsidiaries and the Administrative Agent, in form and
substance satisfactory to the Administrative Agent.



 - 24 -









 





     Trades. 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.



     Tranche. Collectively, or individually as the context indicates, the
Revolving Credit Loans if any are outstanding and/or the Tranche B Term Loan,
and for purposes of §15 only, any new Loan provided to the Borrower in
accordance with the terms and conditions set forth in such §15.



     Tranche B Commitment. With respect to each Tranche B Lender, the
agreement of such Person to make a Tranche B Term Loan on the Funding Date in
the amount set forth on Schedule 1 or any additional commitment to make a
Tranche B Term Loan as provided in §15 or as such amount may be adjusted
pursuant to §17 hereof.



     Tranche B Lenders. Each Lender which has a Tranche B Commitment set forth
opposite its name on Schedule 1 and any other Person who becomes an assignee of
any rights and obligations of a Tranche B Lender pursuant to §17 or who agrees
to advance additional Tranche B Term Loans pursuant to §15.



     Tranche B Maturity Date. November 10, 2011.



     Tranche B Term Loan. The term loan made or to be made by the Tranche B
Lenders to the Borrower on the Funding Date in the aggregate principal amount
of $675,000,000 pursuant to §3.1, as such amount may be increased thereafter
pursuant to the terms and conditions set forth in §15.



     Tranche B Term Notes. See §3.2.



     Type. As to any Revolving Credit Loan or all or any portion of the
Tranche B Term Loan or all or any portion of any additional term loan
structured as a term tranche pursuant to §15.1, its nature as a Base Rate Loan
or a Eurodollar Rate Loan.



     UCC. The Uniform Commercial Code as in effect in the State of New York.



     Unpaid Reimbursement Obligation. Any Reimbursement Obligation for which
the Borrower does not reimburse the Administrative Agent and the Revolving
Credit Lenders on the date specified in, and in accordance with, §5.2.



     1.2. Rules of Interpretation.




     (a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Credit Agreement.




     (b) The singular includes the plural and the plural includes the
singular.




     (c) A reference to any law includes any amendment or modification to
such law.




     (d) A reference to any Person includes its permitted successors and
permitted assigns.




     (e) Accounting terms not otherwise defined herein have the meanings
assigned to them by GAAP applied on a consistent basis by the accounting
entity to which they refer.




     (f) The words “include”, “includes” and “including” are not
limiting.



 - 25 -









 






     (g) All terms not specifically defined herein or by GAAP, which
terms are defined in the UCC have the meanings assigned to them therein,
with the term “instrument” being that defined under Article 9 of the UCC.




     (h) Reference to a particular “§” refers to that section of this
Credit Agreement unless otherwise indicated.




     (i) The words “herein”, “hereof”, “hereunder” and words of like
import shall refer to this Credit Agreement as a whole and not to any
particular section or subdivision of this Credit Agreement.




     (j) Unless otherwise expressly indicated, in the computation of
periods of time from a specified date to a later specified date, the word
“from” means “from and including,” the words “to” and “until” each mean
“to but excluding,” and the word “through” means “to and including.”




     (k) This Credit Agreement and the other Loan Documents may use
several different limitations, tests or measurements to regulate the same
or similar matters. All such limitations, tests and measurements are,
however, cumulative and are to be performed in accordance with the terms
thereof.




     (l) This Credit Agreement and the other Loan Documents are the
result of negotiation among, and have been reviewed by counsel to, among
others, the Administrative Agent and the Borrower and are the product of
discussions and negotiations among all parties. Accordingly, this Credit
Agreement and the other Loan Documents are not intended to be construed
against the Administrative Agent or any of the Lenders merely on account
of the Administrative Agent’s or any Lender’s involvement in the
preparation of such documents.



2. THE REVOLVING CREDIT FACILITY.




     2.1. Commitment to Lend. Subject to the terms and conditions set forth in
this Credit Agreement, each of the Revolving Credit Lenders severally agrees to
lend to the Borrower and the Borrower may borrow, repay, and reborrow from time
to time from the Funding Date up to but not including the Revolving Credit Loan
Maturity Date upon notice by the Borrower to the Administrative Agent given in
accordance with §2.6, such sums as are requested by the Borrower up to a
maximum aggregate amount outstanding (after giving effect to all amounts
requested) at any one time equal to such Revolving Credit Lender’s Revolving
Credit Commitment minus such Revolving Credit Lender’s Commitment Percentage of
the sum of the Maximum Drawing Amount and all Unpaid Reimbursement Obligations,
provided that the sum of the outstanding aggregate amount of all Revolving
Credit Loans (after giving effect to all amounts requested) plus the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations shall not at any time
exceed the Total Revolving Credit Commitment at such time. The Revolving
Credit Loans shall be made pro rata in accordance with each Revolving Credit
Lender’s Commitment Percentage of the Total Revolving Credit Commitment. Each
request for a Revolving Credit Loan hereunder shall constitute a representation
and warranty by the Borrower that the conditions set forth in §12 and §13, in
the case of the initial Revolving Credit Loans to be made on the Funding Date,
and §13, in the case of all other Revolving Credit Loans, have been satisfied
on the date of such request.



     2.2. Commitment Fee. The Borrower agrees to pay to the Administrative
Agent for the accounts of the Revolving Credit Lenders in accordance with their
respective Commitment Percentages of the Total Revolving Credit Commitment a
commitment fee (the “Commitment Fee”) calculated at the rate of (a) at any time
when the Total Leverage Ratio, determined as at the last day of the Reference
Period most recently ended, equals or exceeds 6.00:1.00, 0.500% per annum, (b)
at any time when the Total Leverage Ratio, determined as at the last day of the
Reference Period most recently ended, equals or



 - 26 -









 





exceeds 5.00:1.00, but is less
than 6.00:1.00, 0.375% per annum, and (c) at any time when the Total Leverage
Ratio, determined as at the last day of the Reference Period most recently
ended, is less than 5.00:1.00, 0.250% per annum, in each case, on the actual
daily amount during each calendar quarter or portion thereof from the Funding
Date to the Revolving Credit Loan Maturity Date by which the Total Revolving
Credit Commitment minus the sum of the Maximum Drawing Amount and all Unpaid
Reimbursement Obligations exceeds the outstanding amount of Revolving Credit
Loans during such calendar quarter. The Commitment Fee shall be calculated by
the Administrative Agent by reference to the
Compliance Certificate most recently delivered pursuant to §9.4(c) and
adjusted as necessary on each Adjustment Date (and in the event the Borrower
fails to deliver a Compliance Certificate when so required, the Commitment Fee
shall be calculated adopting the Total Leverage Ratio assumed for purposes of
the calculation of the Applicable Margin pursuant to the provisos of clause (a)
of the definition of Applicable Margin). The Commitment Fee shall be payable
quarterly in arrears on each Interest Payment Date with respect to Base Rate
Loans, with a final payment on the Revolving Credit Loan Maturity Date or any
earlier date on which the Revolving Credit Commitments shall terminate.



     2.3. Reduction of Revolving Credit Commitment. The Borrower shall have
the right at any time and from time to time upon five (5) Business Days’ prior
written notice to the Administrative Agent to reduce by $2,000,000 or an
integral multiple thereof or to terminate entirely the Total Revolving Credit
Commitment, whereupon the Revolving Credit Commitments of the Revolving Credit
Lenders shall be reduced pro rata in accordance with their respective
Commitment Percentages of the Total Revolving Credit Commitment of the amount
specified in such notice or, as the case may be, terminated. Promptly after
receiving any notice of the Borrower delivered pursuant to this §2.3, the
Administrative Agent will notify the Revolving Credit Lenders of the substance
thereof. Upon the effective date of any such reduction or termination, the
Borrower shall pay to the Administrative Agent for the respective accounts of
the Revolving Credit Lenders the full amount of any Commitment Fee then accrued
on the amount of the reduction. No reduction or termination of the Revolving
Credit Commitments may be reinstated. In addition, the Total Revolving Credit
Commitment shall be reduced in accordance with §4.



     2.4. Evidence of Revolving Credit Loans; Revolving Credit Notes. The
Revolving Credit Loans made by each Revolving Credit Lender shall be evidenced
by one or more accounts or records maintained by such Lender and by the
Administrative Agent in the ordinary course of business. The accounts or
records maintained by the Administrative Agent and each Revolving Credit Lender
shall be conclusive absent manifest error of the amount of the Revolving Credit
Loans made by the Revolving Credit Lenders to the Borrower and the interest and
payments thereon. Any failure to so record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Borrower hereunder to
pay any amount owing with respect to the Obligations. In the event of any
conflict between the accounts and records maintained by any Revolving Credit
Lender and the accounts and records of the Administrative Agent in respect of
such matters, the accounts and records of the Administrative Agent shall
control in the absence of manifest error. In addition to such accounts or
records, upon request of any Revolving Credit Lender, its Revolving Credit
Loans shall be evidenced by a separate promissory note of the Borrower in
substantially the form of Exhibit A hereto (each a “Revolving Credit Note”),
and completed with appropriate insertions. Any such Revolving Credit Note
shall be payable to the order of such Revolving Credit Lender in a principal
amount equal to such Revolving Credit Lender’s Revolving Credit Commitment or,
if less, the outstanding amount of all Revolving Credit Loans made by such
Revolving Credit Lender, plus interest accrued thereon, as set forth below.
Each Revolving Credit Lender may attach schedules to its Revolving Credit Note
and endorse thereon the date, Type (if applicable), amount and maturity of its
Revolving Credit Loans and payments with respect thereto.



     2.5. Interest on Revolving Credit Loans. Except as otherwise provided in
§6.11,




     (a) Each Revolving Credit Loan which is a Base Rate Loan shall bear
interest for each day on which such Base Rate Loan is outstanding at the
rate per annum equal to the Base Rate plus the Applicable Margin in
effect from time to time with respect to Revolving Credit Loans which are
Base Rate Loans.



 - 27 -









 






     (b) Each Revolving Credit Loan which is a Eurodollar Rate Loan shall
bear interest for each Interest Period applicable thereto at the rate per
annum equal to the Eurodollar Rate determined for each Interest Period
plus the Applicable Margin in effect from time to time with respect to
Revolving Credit Loans which are Eurodollar Rate Loans.



The Borrower promises to pay interest on each Revolving Credit Loan in arrears
on each Interest Payment Date with respect thereto.



     2.6. Requests for Revolving Credit Loans.



     The Borrower shall give to the Administrative Agent written notice in the
form of Exhibit B hereto (or telephonic notice confirmed in a writing in the
form of Exhibit B hereto) of each Revolving Credit Loan requested hereunder (a
“Loan Request”) no later than (a) 11:00 a.m. (Dallas, Texas time) on the day
that is one (1) Business Day prior to the proposed Drawdown Date of any Base
Rate Loan and (b) 11:00 a.m. (Dallas, Texas time) on the day that is three (3)
Eurodollar Business Days prior to the proposed Drawdown Date of any Eurodollar
Rate Loan. Each such notice shall specify (i) the principal amount of the
Revolving Credit Loan requested, (ii) the proposed Drawdown Date of such
Revolving Credit Loan, (iii) the Type of such Revolving Credit Loan and (iv) in
the case of a Eurodollar Rate Loan, the Interest Period for such Revolving
Credit Loan. Promptly upon receipt of any such notice, the Administrative
Agent shall notify each of the Revolving Credit Lenders thereof. Each Loan
Request shall be irrevocable and binding on the Borrower and shall obligate the
Borrower to accept the Revolving Credit Loan requested from the Revolving
Credit Lenders on the proposed Drawdown Date. Each Loan Request shall be in a
minimum aggregate amount of (a) in the case of Base Rate Loans, $500,000 or in
integral multiples of $100,000 in excess thereof and (b) in the case of
Eurodollar Rate Loans, $1,000,000 or in integral multiples of $100,000 in
excess thereof; provided, that no more than twelve (12) Eurodollar Rate Loans
having different Interest Periods may be outstanding at any time.



     2.7. Conversion Options.




     2.7.1. Conversion to Different Type of Revolving Credit Loan. The
Borrower may elect from time to time to convert any outstanding Revolving
Credit Loan to a Revolving Credit Loan of another Type, provided that
with respect to any such conversion of a Base Rate Loan to a Eurodollar
Rate Loan, the Borrower shall give the Administrative Agent prior written
notice of such election no later than 11:00 a.m. (Dallas, Texas time) on
the third (3rd) Eurodollar Business Day prior to the date of such
conversion; and no Revolving Credit Loan may be converted into a
Eurodollar Rate Loan when any Event of Default has occurred and is
continuing. On the date on which such conversion is being made, each
Revolving Credit Lender shall take such action as is necessary to
transfer its Commitment Percentage of such Revolving Credit Loans to its
Domestic Lending Office or its Eurodollar Lending Office, as the case may
be. All or any part of outstanding Revolving Credit Loans of any Type
may be converted into a Revolving Credit Loan of another Type as provided
herein; provided that if a Eurodollar Rate Loan is converted to a Base
Rate Loan on a day which is not the last day of the Interest Period
relating thereto, the Borrower shall indemnify the Lenders for any
additional costs relating thereto pursuant to §6.10. Each Conversion
Request relating to the conversion of a Revolving Credit Loan to a
Eurodollar Rate Loan shall be irrevocable by the Borrower.




     2.7.2. Continuation of Type of Revolving Credit Loan. Any Revolving
Credit Loan of any Type may be continued as a Revolving Credit Loan of
the same Type upon the expiration of an Interest Period with respect
thereto by compliance by the Borrower with the notice provisions
contained in §2.7.1; provided that no Eurodollar Rate Loan may be
continued as such when any Event of Default has occurred and is
continuing, but shall be automatically converted to a Base Rate Loan on
the last day of the first Interest Period relating thereto ending during
the continuance of any Event of Default of which officers of the
Administrative Agent active upon the



 - 28 -









 






Borrower’s account have actual
knowledge. In the event that the Borrower fails to provide any such
notice with respect to the continuation of any Eurodollar Rate Loan as
such, then such Eurodollar Rate Loan shall be automatically converted to
a Base Rate Loan on the last day of the Interest Period relating thereto.
The Administrative Agent shall notify the Revolving Credit Lenders
promptly when any such automatic conversion contemplated by this §2.7.2
is scheduled to occur.




     2.7.3. Eurodollar Rate Loans. Any conversion to or from Eurodollar
Rate Loans shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, the aggregate principal
amount of all Eurodollar Rate Loans having the same Interest Period shall
not be less than $1,000,000 or an integral multiple of $100,000 in excess
thereof. No more than twelve (12) Eurodollar Rate Loans having different
Interest Periods may be outstanding at any time.



     2.8. Funds for Revolving Credit Loans.




     2.8.1. Funding Procedures. Not later than 12:00 noon (Dallas, Texas
time) on the proposed Drawdown Date of any Revolving Credit Loans, each
of the Revolving Credit Lenders will make available to the Administrative
Agent, at the Administrative Agent’s Office, in immediately available
funds, the amount of such Revolving Credit Lender’s Commitment Percentage
of the amount of the requested Revolving Credit Loans. Upon receipt from
each Revolving Credit Lender of such amount, and upon receipt of the
documents required by §§12 and 13 and the satisfaction of the other
conditions set forth therein, to the extent applicable, the
Administrative Agent will make available to the Borrower the aggregate
amount of such Revolving Credit Loans made available to the
Administrative Agent by the Revolving Credit Lenders. The failure or
refusal of any Revolving Credit Lender to make available to the
Administrative Agent at the aforesaid time and place on any Drawdown Date
the amount of its Commitment Percentage of the requested Revolving Credit
Loans shall not relieve any other Revolving Credit Lender from its
several obligation hereunder to make available to the Administrative
Agent the amount of such other Revolving Credit Lender’s Commitment
Percentage of any requested Revolving Credit Loans.




     2.8.2. Advances by Administrative Agent. The Administrative Agent
may, unless notified to the contrary by any Revolving Credit Lender prior
to a Drawdown Date, assume that such Revolving Credit Lender has made
available to the Administrative Agent on such Drawdown Date the amount of
such Revolving Credit Lender’s Commitment Percentage of the Revolving
Credit Loans to be made on such Drawdown Date, and the Administrative
Agent may (but it shall not be required to), in reliance upon such
assumption, make available to the Borrower a corresponding amount. If
any Revolving Credit Lender makes available to the Administrative Agent
such amount on a date after such Drawdown Date, such Revolving Credit
Lender shall pay to the Administrative Agent on demand an amount equal to
the product of (a) the average computed for the period referred to in
clause (c) below, of the weighted average interest rate paid by the
Administrative Agent for federal funds acquired by the Administrative
Agent during each day included in such period, times (b) the amount of
such Revolving Credit Lender’s Commitment Percentage of such Revolving
Credit Loans, times (c) a fraction, the numerator of which is the number
of days that elapse from and including such Drawdown Date to the date on
which the amount of such Revolving Credit Lender’s Commitment Percentage
of such Revolving Credit Loans shall become immediately available to the
Administrative Agent, and the denominator of which is 360. A statement
of the Administrative Agent submitted to such Revolving Credit Lender
with respect to any amounts owing under this paragraph shall be prima
facie evidence of the amount due and owing to the Administrative Agent by
such Revolving Credit Lender. If the amount of such Revolving Credit
Lender’s Commitment Percentage of such Revolving Credit Loans is not made
available to the Administrative Agent by such Revolving Credit Lender
within three (3) Business Days following such Drawdown Date, the
Administrative Agent shall be



 - 29 -









 






entitled to recover such amount from the
Borrower on demand, with interest thereon at the rate per annum
applicable to the Revolving Credit Loans made on such Drawdown Date.



     2.9. Settlements.




     2.9.1. General. On each Settlement Date, the Administrative Agent
shall promptly give notice (a) to the Revolving Credit Lenders and the
Borrower of the respective outstanding amount of Revolving Credit Loans
made by the Administrative Agent on behalf of the Revolving Credit
Lenders from the immediately preceding Settlement Date through the close
of business on the prior day and the amount of any Eurodollar Rate Loans
to be made (following the giving of notice pursuant to §2.6) on such date
pursuant to a Loan Request and (b) to the Revolving Credit Lenders of the
amount (a “Settlement Amount”) that each Revolving Credit Lender (a
“Settling Lender”) shall pay to effect a Settlement of any Revolving
Credit Loan. A statement of the Administrative Agent submitted to the
Revolving Credit Lenders and the Borrower or to the Revolving Credit
Lenders with respect to any amounts owing under this §2.9 shall be prima
facie evidence of the amount due and owing. Each Settling Lender shall,
not later than 1:00 p.m. (Dallas, Texas time) on such Settlement Date,
effect a wire transfer of immediately available funds to the
Administrative Agent in the amount of the Settlement Amount for such
Settling Lender. All funds advanced by any Revolving Credit Lender as a
Settling Lender pursuant to this §2.9 shall for all purposes be treated
as a Revolving Credit Loan made by such Settling Lender to the Borrower
and all funds received by any Revolving Credit Lender pursuant to this
§2.9 shall for all purposes be treated as repayment of amounts owed with
respect to Revolving Credit Loans made by such Revolving Credit Lender.
In the event that any bankruptcy, reorganization, liquidation,
receivership or similar cases or proceedings in which the Borrower is a
debtor prevent a Settling Lender from making any Revolving Credit Loan to
effect a Settlement as contemplated hereby, such Settling Lender will
make such dispositions and arrangements with the other Revolving Credit
Lenders with respect to such Revolving Credit Loans, either by way of
purchase of participations, distribution, pro tanto assignment of claims,
subrogation or otherwise as shall result in each Revolving Credit
Lender’s share of the outstanding Revolving Credit Loans being equal, as
nearly as may be, to such Revolving Credit Lender’s Commitment Percentage
of the outstanding amount of the Revolving Credit Loans.




     2.9.2. Failure to Make Funds Available. The Administrative Agent
may, unless notified to the contrary by any Settling Lender prior to a
Settlement Date, assume that such Settling Lender has made or will make
available to the Administrative Agent on such Settlement Date the amount
of such Settling Lender’s Settlement Amount, and the Administrative Agent
may (but it shall not be required to), in reliance upon such assumption,
make available to the Borrower a corresponding amount. If any Settling
Lender makes available to the Administrative Agent such amount on a date
after such Settlement Date, such Settling Lender shall pay to the
Administrative Agent on demand an amount equal to the product of (a) the
average computed for the period referred to in clause (c) below, of the
weighted average interest rate paid by the Administrative Agent for
federal funds acquired by the Administrative Agent during each day
included in such period, times (b) the amount of such Settlement Amount,
times (c) a fraction, the numerator of which is the number of days that
elapse from and including such Settlement Date to the date on which the
amount of such Settlement Amount shall become immediately available to
the Administrative Agent, and the denominator of which is 360. A
statement of the Administrative Agent submitted to such Settling Lender
with respect to any amounts owing under this §2.9.2 shall be prima facie
evidence of the amount due and owing to the Administrative Agent by such
Settling Lender. If such Settling Lender’s Settlement Amount is not made
available to the Administrative Agent by such Settling Lender within
three (3) Business Days following such Settlement Date, the
Administrative Agent shall be entitled to recover such amount from the
Borrower on demand, with interest thereon at the rate per annum
applicable to the Revolving Credit Loans as of such Settlement Date.



 - 30 -









 






     2.9.3. No Effect on Other Revolving Credit Lenders. The failure or
refusal of any Settling Lender to make available to the Administrative
Agent at the aforesaid time and place on any Settlement Date the amount
of such Settling Lender’s Settlement Amount shall not (a) relieve any
other Settling Lender from its several obligations hereunder to make
available to the Administrative Agent the amount of such other Settling
Lender’s Settlement Amount or (b) impose upon any Revolving Credit Lender, other than the Settling Lender so
failing or refusing, any liability with respect to such failure or
refusal or otherwise increase the Revolving Credit Commitment of such
other Revolving Credit Lender.



     2.10. Repayment Of The Revolving Credit Loans.





     2.10.1. Maturity. The Borrower promises to pay on the Revolving
Credit Loan Maturity Date, and there shall become absolutely due and
payable on the Revolving Credit Loan Maturity Date, all of the Revolving
Credit Loans outstanding on such date, together with any and all accrued
and unpaid interest thereon.




     2.10.2. Mandatory Repayments of Revolving Credit Loans. If at any
time the sum of the outstanding amount of the Revolving Credit Loans, the
Maximum Drawing Amount and all Unpaid Reimbursement Obligations exceeds
the Total Revolving Credit Commitment at such time, then the Borrower
shall immediately pay the amount of such excess to the Administrative
Agent for the respective accounts of the Revolving Credit Lenders for
application: first, to any Unpaid Reimbursement Obligations; second, to
the Revolving Credit Loans; and third, to provide to the Administrative
Agent cash collateral for Reimbursement Obligations as contemplated by
§5.2(b) and 5.2(c). Each payment of any Unpaid Reimbursement Obligations
or prepayment of Revolving Credit Loans shall be allocated among the
Revolving Credit Lenders, in proportion, as nearly as practicable, to
each Reimbursement Obligation or (as the case may be) the respective
unpaid principal amount of each Revolving Credit Lender’s Revolving
Credit Note, with adjustments to the extent practicable to equalize any
prior payments or repayments not exactly in proportion. In addition, the
Borrower shall repay the Revolving Credit Loans in accordance with §4.




     2.10.3. Optional Repayments of Revolving Credit Loans. The Borrower
shall have the right, at its election, to repay the outstanding amount of
the Revolving Credit Loans, as a whole or in part, at any time without
penalty or premium, provided that no Eurodollar Rate Loans may be prepaid
pursuant to this §2.10.3 except on the last day of the Interest Period
relating thereto unless breakage costs incurred by the Revolving Credit
Lenders in connection therewith are paid by the Borrower in accordance
with §6.10. The Borrower shall give the Administrative Agent written
notice by no later than 11:00 a.m. (Dallas, Texas time) at least one (1)
Business Day prior to the proposed date of any prepayment pursuant to
this §2.10.3 of Base Rate Loans, and at least three (3) Eurodollar
Business Days’ prior to the proposed date of any prepayment pursuant to
this §2.10.3 of Eurodollar Rate Loans, in each case specifying the
proposed date of prepayment of Revolving Credit Loans and the principal
amount to be prepaid. Each such partial prepayment of the Revolving
Credit Loans shall be in an integral multiple of $2,000,000, shall be
accompanied by the payment of accrued interest on the principal prepaid
to the date of prepayment and shall be applied, in the absence of
instruction by the Borrower, first to the principal of Base Rate Loans
and then to the principal of Eurodollar Rate Loans. Each partial
prepayment shall be allocated among the Revolving Credit Lenders, in
proportion, as nearly as practicable, to the respective unpaid principal
amount of each Revolving Credit Lender’s Revolving Credit Note, with
adjustments to the extent practicable to equalize any prior repayments
not exactly in proportion.



3. THE TRANCHE B TERM LOAN.


- 31 -









 




     3.1. Commitment to Lend. Subject to the terms and conditions set forth in
this Credit Agreement, each Tranche B Lender agrees to lend to the Borrower on
the Funding Date the amount of its Commitment Percentage of the Tranche B Term
Loan.



     3.2. Evidence of Tranche B Term Loan; Tranche B Term Notes. The Tranche B
Term Loans made by each Tranche B Lender shall be evidenced by one or more
accounts or records maintained
by such Tranche B Lender and by the Administrative Agent in the ordinary
course of business. The accounts or records maintained by the Administrative
Agent and each Tranche B Lender shall be conclusive absent manifest error of
the amount of the Tranche B Term Loan made by the Tranche B Lenders to the
Borrower and the interest and payments thereon. Any failure to so record or
any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrower hereunder to pay any amount owing with respect to
the Obligations. In the event of any conflict between the accounts and records
maintained by any Tranche B Lender and the accounts and records of the
Administrative Agent in respect of such matters, the accounts and records of
the Administrative Agent shall control in the absence of manifest error. In
addition to such accounts or records, upon request of any Tranche B Lender, the
Tranche B Term Loan shall be evidenced by separate promissory notes of the
Borrower in substantially the form of Exhibit C hereto (each a “Tranche B Term
Note”), and completed with appropriate insertions. Any such Tranche B Term
Note shall be payable to the order of such Tranche B Lender in a principal
amount equal to such Tranche B Lender’s Commitment Percentage of the Tranche B
Term Loan and representing the obligation of the Borrower to pay to such
Tranche B Lender such principal amount or, if less, the outstanding amount of
such Tranche B Lender’s Commitment Percentage of the Tranche B Term Loan, plus
interest accrued thereon, as set forth below. Each Tranche B Lender may attach
schedules to its Tranche B Term Note and endorse thereon the date, Type (if
applicable), amount and maturity of its Tranche B Term Loans and payments with
respect thereto.



     3.3. Mandatory Prepayment of Tranche B Term Loan; Scheduled Amortization.
On the last day of each fiscal quarter of the Borrower commencing with the
fiscal quarter ending February 28, 2005, and ending on the fiscal quarter
ending August 31, 2011, the Borrower promises to pay to the Administrative
Agent for the pro rata account of the Tranche B Lenders an amount equal to
0.25% of the original principal amount of the Tranche B Term Loan outstanding
on the Funding Date, with the entire remaining unpaid principal balance (plus
interest and other amounts payable in respect thereof) of the Tranche B Term
Loan due and payable on the Tranche B Maturity Date. In addition, the Borrower
shall repay the Tranche B Loan in accordance with §4.



     3.4. Optional Prepayment of Tranche B Term Loan. The Borrower shall have
the right at any time to prepay the Tranche B Term Notes on or before the
Tranche B Maturity Date, as a whole, or in part, upon prior written notice to
the Administrative Agent given on or before 11:00 a.m. (Dallas, Texas time) on
the third (3rd) Business Days prior to the date of such prepayment, without
premium or penalty, provided that (a) each partial prepayment shall be in the
principal amount of $2,500,000 or an integral multiple thereof, (b) no portion
of the Tranche B Term Loan bearing interest at the Eurodollar Rate may be
prepaid pursuant to this §3.4 except on the last day of the Interest Period
relating thereto unless breakage costs incurred by the Tranche B Lenders in
connection therewith are paid by the Borrower in accordance with §6.10, and (c)
each partial prepayment shall be allocated among the Tranche B Lenders, in
proportion, as nearly as practicable, to the respective outstanding amount of
each Tranche B Lender’s Tranche B Term Note, with adjustments to the extent
practicable to equalize any prior prepayments not exactly in proportion. Any
prepayment of principal of the Tranche B Term Loan shall include all interest
accrued to the date of prepayment and shall be applied to reduce remaining
scheduled installments of principal due on the Tranche B Term Loan ratably. No
amount repaid with respect to the Tranche B Term Loan may be reborrowed.



     3.5. Interest on Tranche B Term Loan.



 - 32 -






 






     3.5.1. Interest Rates. Except as otherwise provided in §6.11, the
Tranche B Term Loan shall bear interest at the following rates:




     (a) To the extent that all or any portion of the Tranche B Term Loan
bears interest at the Base Rate, the Tranche B Term Loan or such portion
shall bear interest at the rate per annum equal to the Base Rate plus the
Applicable Margin in effect with respect to that portion of the Tranche B
Term Loan comprised of Base Rate Loans.




     (b) To the extent that all or any portion of the Tranche B Term Loan
bears interest during any Interest Period at the Eurodollar Rate, the
Tranche B Term Loan or such portion shall bear interest during such
Interest Period at the rate per annum equal to the Eurodollar Rate
determined for such Interest Period plus the Applicable Margin in effect
with respect to that portion of the Tranche B Term Loans comprised of
Eurodollar Rate Loans.




     The Borrower promises to pay interest on the Tranche B Term Loan or any
portion thereof outstanding in arrears on each Interest Payment Date.




     3.5.2. Notification by Borrower. The Borrower shall notify the
Administrative Agent, such notice to be irrevocable, by 11:00 a.m. on the
date that is three (3) Eurodollar Business Days prior to the Drawdown
Date of the Tranche B Term Loan if all or any portion of the Tranche B
Term Loan is to bear interest at the Eurodollar Rate. After the Tranche
B Term Loan has been made, the provisions of §2.7 shall apply mutatis
mutandis with respect to all or any portion of the Tranche B Term Loan so
that the Borrower may have the same interest rate options with respect to
all or any portion of the Tranche B Term Loan as it would be entitled to
with respect to the Revolving Credit Loans.




     3.5.3. Amounts, etc. Any portion of the Tranche B Term Loan bearing
interest at the Eurodollar Rate relating to any Interest Period shall be
in the amount of $1,000,000 or in integral multiples of $100,000 in
excess thereof. The number of Eurodollar Rate Loans having different
Interest Periods outstanding at any time shall not exceed ten (10). No
Interest Period relating to the Tranche B Term Loan or any portion
thereof bearing interest at the Eurodollar Rate shall extend beyond the
date on which a regularly scheduled installment payment of the principal
of the Tranche B Term Loan is to be made unless a portion of the Tranche
B Term Loan at least equal to such installment payment has an Interest
Period ending on such date or is then bearing interest at the Base Rate.



4. MANDATORY REPAYMENT OF THE LOANS.




     In addition to payments in respect of Revolving Credit Loans pursuant to
§2.10 and scheduled amortization payments in respect of the Tranche B Term Loan
pursuant to §3.3, the Loans shall be repaid as follows:



     4.1. Excess Cash Flow Recapture. If for each fiscal year ending on or
after February 28, 2007, there shall be Consolidated Excess Cash Flow and if
the Total Leverage Ratio as at the last day of such fiscal year is equal to or
greater than 6.50:1.00, the Borrower shall pay to the Administrative Agent, for
the respective accounts of the Lenders as provided in §4.5, an amount equal to
fifty percent (50%) of Consolidated Excess Cash Flow for such fiscal year, such
prepayment to be due five (5) days after receipt of the audited financial
statements delivered pursuant to §9.4(a) but in any event no later than one
hundred (100) days after the end of each applicable fiscal year and to be
applied to prepay the Loans in the manner set forth in §4.5.



     4.2. Proceeds of Asset Sales and Asset Swaps. If the Parent, the Borrower
or any Subsidiary receives Net Cash Sale Proceeds in excess of $25,000,000 from
any Asset Sale or Asset Swap



 - 33 -









 





involving a Station or any publishing asset
(whether through a single or a series or related transactions) and, as of the
last day of the fiscal quarter ended immediately prior to the date of such
Asset Sale or Asset Swap, the Total Leverage Ratio is (a) equal to or greater
than 6.50:1.00, or (b) less than 6.50:1.00 but equal to or greater than
6.00:1.00, the Borrower shall pay to the Administrative Agent, for the
respective accounts of the Lenders, an amount equal to (i) in the case of a
Total Leverage Ratio described in clause (a), one hundred percent (100%) of
such Net Cash Sale Proceeds, or (ii) in the case of a Total Leverage Ratio
described in clause (b), fifty percent (50%) of such Net Cash Sale Proceeds, in
each case, to be applied to prepay the Loans in the manner set forth in §4.5;
provided, however, that if (x) within three hundred sixty-
five (365) days of receipt of such Net Cash Sale Proceeds, the Borrower
identifies to the Administrative Agent in writing an investment or acquisition
otherwise permitted under §10.3(j) or §10.5.1, respectively, and (y) within
five hundred forty-five (545) days of receipt of such Net Cash Sale Proceeds
(or seven hundred thirty (730) days, in the case of an Asset Swap), the
Borrower consummates such Permitted Acquisition or investments permitted under
§10.3 with all or a portion of such Net Cash Sale Proceeds, the Borrower shall
not be required to prepay the Loans under this §4.2 with that portion of the
Net Cash Sale Proceeds applied to finance such Permitted Acquisition or
permitted investments but shall in any event comply with the terms of §4.6.



     4.3. Proceeds of Equity Issuances. If the Parent, the Borrower or any
Subsidiary receives Net Cash Equity Issuance Proceeds from any Equity Issuance
and as of the last day of the fiscal quarter ended immediately prior to the
date of such Equity Issuance, the Total Leverage Ratio is equal to or greater
than 6:00 to 1:00, the Borrower shall pay to the Administrative Agent for the
respective accounts of the Lenders as provided in §4.5 an amount equal to the
lesser of (a) fifty percent (50%) of such Net Cash Equity Issuance Proceeds or
(b) that amount necessary to reduce the Total Leverage Ratio to 6.00:1.00 after
giving effect to such prepayment, such amount to be applied to prepay the Loans
in the manner set forth in §4.5; provided, however, that the Borrower shall not
be required to prepay the Loans under this §4.3 with Net Cash Equity Issuance
Proceeds from an Equity Issuance permitted by §10.14(a) or §10.14(b)(i) or
§10.14(b)(ii); and provided, further, that the Borrower may apply all or any
portion of Net Cash Equity Issuance Proceeds which the Parent, the Borrower or
any Subsidiary may receive from Equity Issuances to finance Permitted
Acquisitions, so long as (i) within ninety (90) days of receipt by such Person
of such Net Cash Equity Issuance Proceeds, the Borrower identifies to the
Administrative Agent in writing an acquisition permitted under §10.5.1 which
will be financed with such proceeds, and (ii) within three hundred sixty-five
(365) days of receipt of such Net Cash Equity Issuance Proceeds, the Borrower
consummates such Permitted Acquisition with all or a portion of such Net Cash
Equity Issuance Proceeds. The Borrower shall in any event comply with the
terms of §4.6.



     4.4. Proceeds of Subordinated Debt Issuances. If the Parent, the Borrower
or any Subsidiary receives net cash proceeds from any issuance of Subordinated
Debt (other than Subordinated Debt issued to refinance (i) the Subordinated
Notes outstanding on the date hereof, (ii) all or any portion of the Senior
Discount Notes outstanding on the date hereof and (iii) all or any portion of
the Refinancing Notes outstanding on or after the date hereof) and the Senior
Leverage Ratio as of the end of the fiscal quarter ended immediately prior to
the date of such Subordinated Debt issuance is greater than 5.00:1.00, the
Borrower shall pay to the Administrative Agent for the respective accounts of
the Lenders an amount equal to the lesser of (a) one hundred percent (100%) of
such net cash proceeds or (b) that amount necessary to reduce the Senior
Leverage Ratio to 5.00:1.00 after giving effect to such prepayment, such amount
to be applied to prepay the Loans in the manner set forth in §4.5.



     4.5. Application of Payments. All payments made pursuant to §§4.1 through
4.4 (other than payments comprised of Net Cash Equity Issuance Proceeds from
any Equity Issuance completed on or before the eighteen (18) month anniversary
of the Funding Date, which such proceeds shall be applied to repay outstanding
Revolving Credit Loans, but shall not permanently reduce the Total Revolving
Credit Commitment) shall be applied: first, to repay the Tranche B Term Loan
with payments applied ratably against the remaining scheduled installments
thereon; and second, if there are no outstanding amounts owing in respect of
the Tranche B Term Loan, then to reduce the outstanding amount of the Revolving
Credit Loans and to permanently reduce the Total Revolving Credit Commitment by
a like amount. Such



 - 34 -









 





mandatory prepayments shall be allocated among the Lenders
in proportion, as nearly as practicable, to the respective outstanding amounts
of each Lender’s Tranche B Term Note or Revolving Credit Note, as applicable,
with adjustments to the extent practicable to equalize any prior prepayments
not exactly in proportion. Except as expressly provided in this §4.5, no
amounts repaid with respect to the Loans pursuant to this §4.5 may be
reborrowed.



     4.6. Delivery of Proceeds. The Borrower shall deliver to the
Administrative Agent, promptly upon receipt thereof, all Net Cash Sale Proceeds
or Net Cash Equity Issuance Proceeds that may have to be
applied to prepay the Loans if not reinvested as permitted in §§4.2 and
4.3, and any cash reserves in connection with an Asset Swap or Asset Sale that
were deducted from Net Cash Sale Proceeds, to be held as Collateral (in an
interest bearing account) pending reinvestment in accordance with such §§4.2
and 4.3, or, in the case of such reserves, pending an application or conversion
into Net Cash Sale Proceeds. Upon the Borrower’s request, any cash amounts
delivered to the Administrative Agent to be held as Collateral under this §4.6
may be applied to repay Revolving Credit Loans, provided that an amount of the
Total Revolving Credit Commitment equal to the amount so repaid may not be
reborrowed until after final application of such amounts so delivered to the
Administrative Agent.



5. LETTERS OF CREDIT.




     5.1. Letter of Credit Commitments.




     5.1.1. Commitment to Issue Letters of Credit. Subject to the terms
and conditions hereof and the execution and delivery by the Borrower of a
letter of credit application on the Administrative Agent’s customary form
(a “Letter of Credit Application”), the Administrative Agent on behalf of
the Revolving Credit Lenders and in reliance upon the agreement of the
Revolving Credit Lenders set forth in §5.1.4 and upon the representations
and warranties of the Borrower contained herein, agrees, in its
individual capacity, to issue, extend and renew for the account of the
Borrower one or more standby letters of credit (individually, a “Letter
of Credit”), in such form as may be requested from time to time by the
Borrower and agreed to by the Administrative Agent; provided, however,
that, after giving effect to such request, (a) the sum of the aggregate
Maximum Drawing Amount and all Unpaid Reimbursement Obligations shall not
exceed $100,000,000 at any one time and (b) the sum of (i) the Maximum
Drawing Amount on all Letters of Credit, (ii) all Unpaid Reimbursement
Obligations, and (iii) the amount of all Revolving Credit Loans
outstanding shall not exceed the Total Revolving Credit Commitment at
such time. Notwithstanding the foregoing, the Administrative Agent shall
have no obligation to issue any Letter of Credit to support or secure any
Indebtedness of an Excluded Subsidiary or any Indebtedness of the
Borrower or any of its Subsidiaries to the extent that such Indebtedness
was incurred prior to the proposed issuance date of such Letter of
Credit.




     5.1.2. Letter of Credit Applications. Each Letter of Credit
Application shall be completed to the satisfaction of the Administrative
Agent. In the event that any provision of any Letter of Credit
Application shall be inconsistent with any provision of this Credit
Agreement, then the provisions of this Credit Agreement shall, to the
extent of any such inconsistency, govern.




     5.1.3. Terms of Letters of Credit. Each Letter of Credit issued,
extended or renewed hereunder shall, among other things, (a) provide for
the payment of sight drafts for honor thereunder when presented in
accordance with the terms thereof and when accompanied by the documents
described therein, and (b) provide for a term of no more than one (1)
year subject to automatic renewals, but in no event have an expiry date
later than the date which is fourteen (14) days (or, if the Letter of
Credit is confirmed by a confirmer or otherwise provides for one or more
nominated persons, forty-five (45) days) prior to the Revolving Credit
Loan Maturity Date. Each Letter of Credit so issued, extended or renewed
shall be subject to the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce



 - 35 -









 






Publication
No. 500 or any successor version thereto adopted by the Administrative
Agent in the ordinary course of its business as a letter of credit issuer
and in effect at the time of issuance of such Letter of Credit (the
“Uniform Customs”) or, in the case of a standby Letter of Credit, either
the Uniform Customs or the International Standby Practices (ISP98),
International Chamber of Commerce Publication No. 590, or any successor
code of standby letter of credit practices among banks adopted by the
Administrative Agent in the ordinary course of its business as a standby
letter of credit issuer and in effect at the time of issuance of such
Letter of Credit.




     5.1.4. Reimbursement Obligations of Revolving Credit Lenders. Each
Revolving Credit Lender severally agrees that it shall be absolutely
liable, without regard to the occurrence of any Default or Event of
Default or any other condition precedent whatsoever, to the extent of
such Revolving Credit Lender’s Commitment Percentage of the Total
Revolving Credit Commitment, to reimburse the Administrative Agent on
demand for the amount of each draft paid by the Administrative Agent
under each Letter of Credit to the extent that such amount is not
reimbursed by the Borrower pursuant to §5.2 (such agreement for a
Revolving Credit Lender being called herein the “Letter of Credit
Participation” of such Revolving Credit Lender).




     5.1.5. Participations of Revolving Credit Lenders. Each such
payment made by a Revolving Credit Lender shall be treated as the
purchase by such Revolving Credit Lender of a participating interest in
the Borrower’s Reimbursement Obligation under §5.2 in an amount equal to
such payment. Each Revolving Credit Lender shall share in accordance
with its participating interest in any interest which accrues pursuant to
§5.2.



     5.2. Reimbursement Obligation of the Borrower. In order to induce the
Administrative Agent to issue, extend and renew each Letter of Credit and the
Revolving Credit Lenders to participate therein, the Borrower hereby agrees to
reimburse or pay to the Administrative Agent, for the account of the
Administrative Agent or (as the case may be) the Revolving Credit Lenders, with
respect to each Letter of Credit issued, extended or renewed by the
Administrative Agent hereunder,




     (a) except as otherwise expressly provided in §(b) and (c), on each
date that any draft presented under such Letter of Credit is honored by
the Administrative Agent, or the Administrative Agent otherwise makes a
payment with respect thereto, (i) the amount paid by the Administrative
Agent under or with respect to such Letter of Credit, and (ii) the amount
of any taxes, fees, charges or other costs and expenses whatsoever
incurred by the Administrative Agent or any Revolving Credit Lender in
connection with any payment made by the Administrative Agent or any
Revolving Credit Lender under, or with respect to, such Letter of Credit,




     (b) upon the reduction (but not termination) of the Total Revolving
Credit Commitment to an amount less than the Maximum Drawing Amount, an
amount equal to such difference, which amount shall be held by the
Administrative Agent for the benefit of the Revolving Credit Lenders and
the Administrative Agent as cash collateral for all Reimbursement
Obligations, and




     (c) upon the termination of the Total Revolving Credit Commitment,
or the acceleration of the Reimbursement Obligations with respect to all
Letters of Credit in accordance with §14, an amount equal to the then
Maximum Drawing Amount on all Letters of Credit, which amount shall be
held by the Administrative Agent for the benefit of the Revolving Credit
Lenders and the Administrative Agent as cash collateral for all
Reimbursement Obligations.



Each such payment shall be made to the Administrative Agent at the
Administrative Agent’s Office in immediately available funds. Interest on any
and all amounts remaining unpaid by the Borrower under this §5.2 at any time
from the date such amounts become due and payable (whether as stated in this
§5.2, by acceleration or otherwise) until payment in full (whether before or
after judgment) shall be payable to the




 - 36 -









 




Administrative Agent on demand at the rate calculated in accordance with
§6.11 for Revolving Credit Loans.




     5.3. Letter of Credit Payments. If any draft shall be presented or other
demand for payment shall be made under any Letter of Credit, the Administrative
Agent shall notify the Borrower of the date and amount of the draft presented
or demand for payment and of the date and time when it expects to pay such
draft or honor such demand for payment. If the Borrower fails to reimburse the
Administrative Agent as provided in §5.2 on or before the date that such draft
is paid or other payment is made by the Administrative Agent, the
Administrative Agent may at any time thereafter notify the Revolving Credit
Lenders of the amount of any such Unpaid Reimbursement Obligation. No later
than 1:00 p.m. (Dallas, Texas time) on the Business Day next following the
receipt of such notice, each Revolving Credit Lender shall make available to
the Administrative Agent, at the Administrative Agent’s Office, in immediately
available funds, such Revolving Credit Lender’s Commitment Percentage (in
respect of the Total Revolving Credit Commitment) of such Unpaid Reimbursement
Obligation, together with an amount equal to the product of (a) the average,
computed for the period referred to in clause (c) below, of the weighted
average interest rate paid by the Administrative Agent for federal funds
acquired by the Administrative Agent during each day included in such period,
times (b) the amount equal to such Revolving Credit Lender’s Commitment
Percentage (in respect of the Total Revolving Credit Commitment) of such Unpaid
Reimbursement Obligation, times (c) a fraction, the numerator of which is the
number of days that elapse from and including the date the Administrative Agent
paid the draft presented for honor or otherwise made payment to the date on
which such Revolving Credit Lender’s Commitment Percentage (in respect of the
Total Revolving Credit Commitment) of such Unpaid Reimbursement Obligation
shall become immediately available to the Administrative Agent, and the
denominator of which is 360. The responsibility of the Administrative Agent to
the Borrower and the Revolving Credit Lenders shall be only to determine that
the documents (including each draft) delivered under each Letter of Credit in
connection with such presentment shall be in conformity in all material
respects with such Letter of Credit.



     5.4. Obligations Absolute. The Borrower’s obligations under this §5 shall
be absolute and unconditional under any and all circumstances and irrespective
of the occurrence of any Default or Event of Default or any condition precedent
whatsoever or any setoff, counterclaim or defense to payment which the Borrower
may have or have had against the Administrative Agent, any Lender or any
beneficiary of a Letter of Credit. The Borrower further agrees with the
Administrative Agent and the Lenders that the Administrative Agent and the
Revolving Credit Lenders shall not be responsible for, and the Borrower’s
Reimbursement Obligations under §5.2 shall not be affected by, among other
things, the validity or genuineness of documents or of any endorsements
thereon, even if such documents should in fact prove to be in any or all
respects invalid, fraudulent or forged, or any dispute between or among the
Borrower, the beneficiary of any Letter of Credit or any financing institution
or other party to which any Letter of Credit may be transferred or any claims
or defenses whatsoever of the Borrower against the beneficiary of any Letter of
Credit or any such transferee. The Administrative Agent and the Revolving
Credit Lenders shall not be liable for any error, omission, interruption or
delay in transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit. The Borrower agrees that
any action taken or omitted by the Administrative Agent or any Revolving Credit
Lender under or in connection with each Letter of Credit and the related drafts
and documents, if done in good faith, shall be binding upon the Borrower and
shall not result in any liability on the part of the Administrative Agent or
any Revolving Credit Lender to the Borrower.



     5.5. Reliance by Issuer. To the extent not inconsistent with §5.4, the
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying upon, any Letter of Credit, draft, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex
or teletype message, statement, order or other document believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take
any action under this Credit Agreement unless it shall first have received such
advice or concurrence of the Required Lenders as it reasonably deems



- 37 -









 







appropriate or it shall first be indemnified to its reasonable
satisfaction by the Revolving Credit Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Credit Agreement
in accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon the
Revolving Credit Lenders and all future holders of the Revolving Credit Notes
or of a Letter of Credit Participation.



     5.6. Letter of Credit Fee. The Borrower shall, on each Interest Payment
Date for Base Rate Loans pay a fee (in each case, a “Letter of Credit Fee”) to
the Administrative Agent in respect of each Letter of Credit in an amount equal
to the sum of (a) the Applicable Margin for Revolving Credit Loans outstanding
during the quarter ending on such date which bear interest based on the
Eurodollar Rate of the Maximum Drawing Amount of such standby Letter of Credit
plus (b) one-eighth of one percent (0.125%) per annum of the face amount of
such standby Letter of Credit. The portion of the Letter of Credit Fee
referred to in clause (b) above shall be for the account of the Administrative
Agent, as a fronting fee, and the balance of such Letter of Credit Fee shall be
for the accounts of the Revolving Credit Lenders in accordance with their
respective Commitment Percentages in respect of the Total Revolving Credit
Commitment. In respect of each Letter of Credit, the Borrower shall also pay
to the Administrative Agent for the Administrative Agent’s own account, at such
other time or times as such charges are customarily made by the Administrative
Agent, the Administrative Agent’s customary issuance, amendment, negotiation or
document examination and other administrative fees as in effect from time to
time.



6. CERTAIN GENERAL PROVISIONS.




     6.1. Closing Fees. The Borrower agrees to pay all fees on the Funding Date
that have been expressly agreed to in writing between the Borrower and certain
of the Lenders to be paid on the Funding Date.



     6.2. Administrative Agent’s Fee. The Borrower shall pay to the
Administrative Agent annually in advance, for the Administrative Agent’s own
account, on the Funding Date and on each anniversary of the Funding Date, an
Administrative Agent’s fee (the “Administrative Agent’s Fee”) as set forth in
the Administrative Agent Fee Letter.



     6.3. Funds for Payments.




      6.3.1. Payments to Administrative Agent. All payments of principal,
interest, Reimbursement Obligations, Fees and any other amounts due
hereunder or under any of the other Loan Documents shall be made on the
due date thereof to the Administrative Agent in Dollars, for the
respective accounts of the applicable Lenders and the Administrative
Agent, at the Administrative Agent’s Office or at such other place that
the Administrative Agent may from time to time designate, in each case no
later than 2:00 p.m. (Dallas, Texas time) and in immediately available
funds.




      6.3.2. No Offset, etc. All payments by the Borrower hereunder and
under any of the other Loan Documents shall be made without setoff or
counterclaim and free and clear of and without deduction for any taxes,
levies, imposts, duties, charges, fees, deductions, withholdings,
restrictions or conditions of any nature now or hereafter imposed or
levied by any jurisdiction or any political subdivision thereof or taxing
or other authority therein excluding (A) income and franchise taxes
imposed on (or measured by) the net income or profits of any Lender or
the Administrative Agent by the jurisdictions under the laws of which the
Administrative Agent or any Lender is organized or any political
subdivision thereof, or by the jurisdictions in which the Administrative
Agent or such Lender is located or any political subdivision thereof, or
by the jurisdictions in which the Administrative Agent or such Lender is
doing business or any political subdivision thereof and (B) any branch
profits taxes imposed by the United States of America or



- 38 -









 






any similar tax imposed by any other jurisdiction described in
clause (A) above unless, in each case, the Borrower is compelled by law
to make such deduction or withholding (such non-excluded items referred
to as “Non-Excluded Taxes”). If any such Non-Excluded Taxes are imposed
upon the Borrower with respect to any amount payable by it hereunder or
under any of the other Loan Documents, the Borrower will pay to the
Administrative Agent, for the account of the Lenders or (as the case may
be) the Administrative Agent, on the date on which such amount is due and
payable hereunder or under such other Loan Document, such additional
amount in Dollars as shall be necessary to enable the Lenders or the
Administrative Agent to receive the same net amount which the Lenders or
the Administrative Agent would have received on such due date had no such
obligation been imposed upon the Borrower; provided however that the
Borrower shall not be required to increase any such amounts payable to
any Lender or the Administrative Agent with respect to any such
Non-Excluded Taxes that are attributable to (i) such Administrative
Agent’s or Lender’s failure to comply with the provisions of §6.3.3 or
(ii) that are withholding taxes imposed on the amounts payable to such
Administrative Agent or such Lender at the time such Administrative Agent
or Lender becomes a party to this Credit Agreement, except to the extent
that such Lender’s assignor (if any) was entitled, at the time of
assignment, to receive additional amounts from the Borrower with respect
to such obligation pursuant to this §6.3.2; provided, further, that the
foregoing shall not relieve the Borrower of its obligation to pay
Non-Excluded Taxes in the event that, as a result of any change in any
applicable law, treaty or governmental rule, regulation or order, or any
change in interpretation, administration or application thereof, a
Non-U.S. Lender that was previously entitled to receive all payments
under this Credit Agreement and any Note without deduction or withholding
of any United States federal income taxes is no longer properly entitled
by law to deliver forms, certificates or other evidence at a subsequent
date establishing the fact that such Lender is not subject to
withholding. The Borrower will deliver promptly to the Administrative
Agent certificates or other valid vouchers for all taxes or other
charges deducted from or paid with respect to payments made by the
Borrower hereunder or under such other Loan Document.




      6.3.3. Non-U.S. Lenders. Each Lender and the Administrative Agent
(including any assignee) that is not a U.S. Person as defined in Section
7701(a)(30) of the Code for federal income tax purposes (a “Non-U.S.
Lender”) hereby agrees that, if and to the extent it is legally able to
do so, it shall, prior to the date of the first payment by the Borrower
hereunder to be made to such Lender or the Administrative Agent or for
such Lender’s or the Administrative Agent’s account, deliver to the
Borrower and the Administrative Agent, as applicable, such certificates,
documents or other evidence, as and when required by the Code or Treasury
Regulations issued pursuant thereto, including (a) in the case of a
Non-U.S. Lender that is a “bank” for purposes of Section 881(c)(3)(A) of
the Code, two (2) duly completed copies of Internal Revenue Service Form
W-8BEN or Form W-8ECI and any other certificate or statement of exemption
required by Treasury Regulations, or any subsequent versions thereof or
successors thereto, properly completed and duly executed by such Lender
or the Administrative Agent establishing that with respect to payments of
principal, interest or fees hereunder it is (i) not subject to United
States federal withholding tax under the Code because such payment is
effectively connected with the conduct by such Lender or Administrative
Agent of a trade or business in the United States or (ii) totally exempt
or partially exempt from United States federal withholding tax under a
provision of an applicable tax treaty and (b) in the case of a Non-U.S.
Lender that is not a “bank” for purposes of Section 881(c)(3)(A) of the
Code, a certificate substantially in the form of Exhibit I hereto,
together with a properly completed and executed Internal Revenue Service
Form W-8 or W-9, as applicable (or successor forms). Each Lender or the
Administrative Agent agrees that it shall, promptly upon a change of its
lending office or the selection of any additional lending office, to the
extent the forms previously delivered by it pursuant to this section are
no longer effective, and promptly upon the Borrower’s or the
Administrative Agent’s reasonable request after the occurrence of any
other event (including the passage of time) requiring the delivery of a
Form W-8BEN, Form W-8ECI, Form W-8 or W-9 in addition to or in
replacement of the forms previously delivered, deliver to the Borrower
and the Administrative Agent, as applicable, if and to the



- 39 -









 






extent it is properly entitled to do so, two (2) properly completed
and executed copies of Form W-8BEN, Form W-8ECI, Form W-8 or W-9, as
applicable (or any successor forms thereto). Each Non-U.S. Lender shall
promptly notify the Borrower at any time it determines that it is no
longer in a position to provide any previously delivered certificate to
the Borrower (or any other form of certification adopted by the U.S.
taxing authorities for such purpose).



     6.4. Computations. All computations of interest on the Eurodollar Rate
Loans and of Fees shall be based on a 360-day year and paid for the actual
number of days elapsed. All computations of interest on Base Rate Loans shall
be based on a 365-day or 366-day year, as the case may be, for the actual
number of days elapsed. Except as otherwise provided in the definition of the
term “Interest Period” with respect to Eurodollar Rate Loans, whenever a
payment hereunder or under any of the other Loan Documents becomes due on a day
that is not a Business Day, the due date for such payment shall be extended to
the next succeeding Business Day, and interest shall accrue during such
extension. The outstanding amount of the Loans as reflected from time to time
in the accounts or records maintained by the Lenders and by the Administrative
Agent in accordance with the provisions of this Credit Agreement shall be
considered correct and binding on the Borrower unless within five (5) Business
Days after receipt of any notice by the Administrative Agent or any of the
Lenders of such outstanding amount, the Administrative Agent or such Lender
shall notify the Borrower to the contrary.



     6.5. Inability to Determine Eurodollar Rate. In the event, prior to the
commencement of any Interest Period relating to any Eurodollar Rate Loan, the
Administrative Agent shall determine or be notified by the Required Lenders

that adequate and reasonable methods do not exist for ascertaining the
Eurodollar Rate that would otherwise determine the rate of interest to be
applicable to any Eurodollar Rate Loan during any Interest Period, the
Administrative Agent shall forthwith give notice of such determination (which
shall be conclusive and binding on the Borrower and the Lenders) to the
Borrower and the Lenders. In such event (a) any Loan Request or Conversion
Request with respect to Eurodollar Rate Loans shall be automatically withdrawn
and shall be deemed a request for Base Rate Loans, (b) each Eurodollar Rate
Loan will automatically, on the last day of the then current Interest Period
relating thereto, become a Base Rate Loan, and (c) the obligations of the
Lenders to make Eurodollar Rate Loans shall be suspended until the
Administrative Agent or the Required Lenders determine that the circumstances
giving rise to such suspension no longer exist, whereupon the Administrative
Agent or, as the case may be, the Administrative Agent upon the instruction of
the Required Lenders, shall so notify the Borrower and the Lenders.



     6.6. Illegality. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Lender to make or
maintain Eurodollar Rate Loans, such Lender shall forthwith give notice of such
circumstances to the Borrower and the other Lenders and thereupon (a) the
commitment of such Lender to make Eurodollar Rate Loans or convert Base Rate
Loans to Eurodollar Rate Loans shall forthwith be suspended and (b) such
Lender’s Loans then outstanding as Eurodollar Rate Loans, if any, shall be
converted automatically to Base Rate Loans on the last day of each Interest
Period applicable to such Eurodollar Rate Loans or within such earlier period
as may be required by law. The Borrower hereby agrees promptly to pay the
Administrative Agent for the account of such Lender, upon demand by such
Lender, any additional amounts necessary to compensate such Lender for any
costs incurred by such Lender in making any conversion in accordance with this
§6.6, including any interest or fees payable by such Lender to lenders of funds
obtained by it in order to make or maintain its Eurodollar Rate Loans
hereunder.



     6.7. Additional Costs, etc. If any present or future applicable law,
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon
or otherwise issued to any Lender or the Administrative Agent by any central
bank or other fiscal, monetary or other authority (whether or not having the
force of law), shall:



- 40 -









 






      (a) subject any Lender or the Administrative Agent to any tax, levy,
impost, duty, charge, fee, deduction or withholding of any nature with
respect to this Credit Agreement, the other Loan Documents, any Letters
of Credit, such Lender’s Commitment or the Loans (other than taxes based
upon or measured by the income or profits of such Lender or the
Administrative Agent), or




      (b) materially change the basis of taxation (except for changes in
taxes on income or profits) of payments to any Lender of the principal of
or the interest on any Loans or any other amounts payable to any Lender
or the Administrative Agent under this Credit Agreement or any of the
other Loan Documents, or




      (c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement) any
special deposit, reserve, assessment, liquidity, capital adequacy or
other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans
by, or letters of credit issued by, or commitments of an office of any
Lender, or




      (d) impose on any Lender or the Administrative Agent any other
conditions or requirements with respect to this Credit Agreement, the
other Loan Documents, any Letters of Credit, the Loans, such Lender’s
Commitment, or any class of loans, letters of credit or commitments of
which any of the Loans or such Lender’s Commitment forms a part;




      and the result of any of the foregoing is:




        (i) to increase the cost to any Lender of making, funding,
issuing, renewing, extending or maintaining any of the Eurodollar
Rate Loans or such Lender’s Commitment or any Letter of Credit, or




        (ii) to reduce the amount of principal, interest,
Reimbursement Obligation or other amount payable to such Lender or
the Administrative Agent hereunder on account of such Lender’s
Commitment, any Letter of Credit or any of the Loans, or




        (iii) to require such Lender or the Administrative Agent to
make any payment or to forego any interest or Reimbursement
Obligation or other sum payable hereunder, the amount of which
payment or foregone interest or Reimbursement Obligation or other
sum is calculated by reference to the gross amount of any sum
receivable or deemed received by such Lender or the Administrative
Agent from the Borrower hereunder,


then, and in each such case, the Borrower will, upon demand made by such Lender
or (as the case may be) the Administrative Agent and as often as the occasion
therefor may arise and upon presentation by such Lender or the Administrative
Agent of a certificate pursuant to §6.9, pay to such Lender or the
Administrative Agent such additional amounts as will be sufficient to
compensate such Lender or the Administrative Agent on an after-tax basis for
such additional cost, reduction, payment or foregone interest or Reimbursement
Obligation or other sum.




     6.8. Capital Adequacy. If after the date hereof any Lender determines
that (a) the adoption of or change in any law, governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law)
regarding capital requirements for Lenders or bank holding companies or any
change in the interpretation or application thereof by a Governmental Authority
with appropriate jurisdiction, or (b) compliance by such Lender or any
corporation controlling such Lender with any law, governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law) of any such entity regarding capital adequacy, has the effect of reducing
the return on such Lender’s commitment



- 41 -









 







with respect to any Loans to a level below that which such Lender could
have achieved but for such adoption, change or compliance (taking into
consideration such Lender’s then existing policies with respect to capital
adequacy and assuming full utilization of such entity’s capital) by any amount
deemed by such Lender to be material, then such Lender may notify the Borrower
and the Administrative Agent of such fact. To the extent that the amount of
such reduction in the return on capital is not reflected in the Base Rate, the
Borrower agrees to pay such Lender for the amount of such reduction in the
return on capital as and when such reduction is determined upon presentation by
such Lender of a certificate in accordance with §6.9. Each Lender shall
allocate such cost increases among its customers in good faith and on an
equitable basis.



     6.9. Certificate. A certificate setting forth any additional amounts
payable pursuant to §6.7 or §6.8 and a brief explanation of such amounts which
are due, submitted by any Lender to the Borrower and the Administrative Agent,
shall be conclusive, absent manifest error, that such amounts are due and
owing, which certificate shall be delivered no later than one hundred and
eighty (180) days after the date the Administrative Agent and such Lender shall
have determined that any such additional amount is due.



     6.10. Indemnity. The Borrower agrees to indemnify each Lender and to hold
each Lender harmless from and against any loss (excluding any loss of
anticipated profits), cost or expense that such Lender may sustain or incur as
a consequence of (a) default by the Borrower in payment of the principal amount
of or any interest on any Eurodollar Rate Loans as and when due and payable,
including any such loss or expense arising from interest or fees payable by
such Lender to banks for funds obtained by it in order to maintain its
Eurodollar Rate Loans, (b) default by the Borrower in making a borrowing or
conversion after the Borrower has given (or is deemed to have given) a Loan
Request notice (in the case of all or any portion of the Tranche B Term Loan
pursuant to §3.5.2) or a Conversion Request relating thereto in accordance with
§2.6, §2.7 or §3.5.2, as the case may be, (c) the making of any payment of a
Eurodollar Rate Loan or the making of any conversion of any such Loan to a Base
Rate Loan on a day that is not the last day of the applicable Interest Period
with respect thereto, including interest or fees payable by such Lender to
lenders of funds obtained by it in order to maintain any such Loans.



     6.11. Interest After Default. During the continuance of any Event of
Default of the type described in clauses (a) or (b) of §14.1, the Loans and all
other amounts payable hereunder or under any of the other Loan Documents shall
automatically bear interest, after as well as before judgment, compounded
monthly and payable on demand at a rate per annum equal to two percent (2%)
above the rate of interest then applicable thereto (or, if no rate of interest
is then applicable thereto, the Base Rate).



     6.12. Mitigation Obligations; Replacement of Lenders.




      (a) If any Lender requests compensation under §6.7 or §6.8, or if
the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to
§6.3.2, or any Lender is subject to §6.6, 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
reasonable judgment of such Lender, such designation or assignment (i)
would eliminate or reduce amounts payable pursuant to §6.7 or §6.8 or
§6.3.2 or eliminate the effect of §6.6, 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 requests compensation under §6.7 or §6.8, or if
the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to
§6.3.2, or if any Lender is subject to §6.6, or if any Lender does not
agree to any amendment hereunder requiring the consent of all Lenders and
consented to by



- 42 -









 






the Required Lenders, 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 §17, including, without
limitation, as a condition precedent to such assignment, (i) the
Administrative Agent’s consent to the assignee unless not otherwise
required by §17 and (ii) payment of the registration fee set forth in
§17.1(b)), all its interests, rights and obligations under this Credit
Agreement to an assignee that shall assume such obligations (which
assignee may be another Lender, if a Lender accepts such assignment);
provided that such Lender shall have received irrevocable payment in full
in cash of an amount equal to the outstanding principal of its Loans,
accrued interest thereon, and accrued fees and all other Obligations and
other amounts payable to it hereunder from the assignee or the Borrower
and (ii) such assignment will result in a reduction in such compensation
or payments or removal of such illegality or such amendment being
approved. 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.



7. COLLATERAL SECURITY AND GUARANTIES.




     7.1. Security of Borrower. The Obligations shall be secured by a
perfected first priority security interest (subject only to Permitted Liens
entitled to priority under applicable law) in all of the assets of the Borrower
(other than the Excluded Assets and the Capital Stock of any Excluded
Subsidiary), whether now owned or hereafter acquired, including, without
limitation, an assignment of all of the Borrower’s rights and interests in, to
and under each contract and agreement entered into by the Borrower in
connection with the transactions contemplated by §10.5.1, pursuant to the terms
of the Security Documents to which the Borrower is a party.



     7.2. Guaranties and Security of Parent and Subsidiaries. The Obligations
shall also be guaranteed pursuant to the terms of the Guaranty. The
obligations of the Parent under the Guaranty shall be secured by a perfected
first priority security interest in all of the issued and outstanding Capital
Stock of (i) the Borrower, (ii) each domestic Subsidiary of the Parent now
existing, or hereafter created or acquired and, (iii) to the extent no adverse
tax consequences would result, each foreign Subsidiary of the Parent whether
now existing or hereafter created or acquired, in each case, pursuant to the
terms of the Pledge Agreement. The obligations of the Borrower’s Subsidiaries
under the Guaranty shall be secured by a perfected first priority security
interest (subject only to Permitted Liens entitled to priority under applicable
law) in all of the assets of each such Person (other than Excluded Assets and
the Capital Stock of any Excluded Subsidiary other than the Austin Partnership
and RAM) whether now owned or hereafter acquired, including without limitation
an assignment of each such Person’s rights and interests in, to and under each
contract and agreement entered into by each such Person in connection with the
transactions contemplated by §10.5.1, pursuant to the terms of the Security
Documents to which such Person is a party.



     7.3. Release of Collateral and Guaranties. The parties hereto acknowledge
and agree that, as soon as practicable following a sale or disposition of
assets permitted in accordance with the terms of this Credit Agreement,
including without limitation, §10.5.2, the Administrative Agent shall release
its Liens on the Collateral subject to such sale or disposition and/or any
Subsidiary of the Borrower which is the subject of such sale or disposition
from its obligations under the Guaranty.



8. REPRESENTATIONS AND WARRANTIES.




     The Parent and the Borrower represent and warrant to the Lenders and the
Administrative Agent as follows:



     8.1. Corporate Authority.



- 43 -









 






      8.1.1. Incorporation; Good Standing. Each of the Parent, the
Borrower and the Subsidiaries (a) is a corporation, partnership or
limited liability company (or similar business entity) duly organized,
validly existing and in good standing under the laws of its jurisdiction
of incorporation or formation, (b) has all requisite corporate,
partnership or limited liability company (or the equivalent company)
power to own its property and conduct its business as now conducted and
as presently contemplated, and (c) is in good standing as a foreign
corporation, partnership or limited liability company (or similar
business entity) and is duly authorized to do business in each
jurisdiction where such qualification is necessary except where a failure
to be so qualified would not have a Material Adverse Effect.




      8.1.2. Authorization. The execution, delivery and performance of
this Credit Agreement and the other Loan Documents to which the Parent,
the Borrower or any Subsidiary is or is to become a party and the
transactions contemplated hereby and thereby (a) are within the
corporate, partnership or limited liability company (or the equivalent
company) authority of such Person, (b) have been duly authorized by all
necessary corporate, partnership or limited liability company (or the
equivalent company) proceedings, (c) do not and will not conflict with or
result in any breach or contravention of any provision of law, statute,
rule or regulation to which such Person is subject or any judgment,
order, writ, injunction, license or permit applicable to such Person and
(d) do not conflict with any provision of the Governing Documents of, or
any agreement or other instrument binding upon, such Person.




      8.1.3. Enforceability. The execution and delivery of this Credit
Agreement and the other Loan Documents to which the Parent, the Borrower
or any Subsidiary is or is to become a party will result in valid and
legally binding obligations of such Person enforceable against it in
accordance with the respective terms and provisions hereof and thereof,
except as enforceability is limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting
generally the enforcement of creditors’ rights and except to the extent
that availability of the remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any
proceeding therefor may be brought.



     8.2. Governmental Approvals. The execution, delivery and performance by
the Parent, the Borrower or any Subsidiary of this Credit Agreement and the
other Loan Documents to which such Person is or is to become a party and the
transactions contemplated hereby and thereby do not require the approval or
consent of, or filing with, any governmental agency or authority other than
those already obtained.



     8.3. Title to Properties.




      (a) Except as indicated on Schedule 8.3(a) hereto, the Parent, the
Borrower and the Subsidiaries own all of the assets reflected in the
consolidated balance sheet of the Parent and its subsidiaries as at the
Balance Sheet Date or acquired since that date (except (i) property and
assets which are not integral to the operations of the Stations or
publishing operations owned by the Borrower or its Subsidiaries as such
Stations or publishing operations are operated immediately prior to the
Balance Sheet Date, (ii) property and assets which do not consist of a
Station or publishing asset which have been sold or otherwise disposed of
in the ordinary course of business since that date, (iii) property and
assets which have been replaced since that date or (iv) property and
assets which have been sold or otherwise disposed of after the Funding
Date as permitted hereunder), subject to no rights of others, including
any mortgages, leases, conditional sales agreements, title retention
agreements, liens or other encumbrances except Permitted Liens.




      (b) Schedule 8.3(b) hereto, as updated from time to time in
accordance with §10.5 sets forth all of the Stations of the Borrower and
its Subsidiaries at the time of reference thereto.



     8.4. Financial Statements and Projections.



- 44 -









 






      8.4.1. Fiscal Year. 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.




      8.4.2. Financial Statements. There has been furnished to the
Lenders the consolidated balance sheet of the Parent, the Borrower and
its subsidiaries, as at the Balance Sheet Date, and the related,
similarly adjusted, consolidated statements of income and cash flow for
the fiscal year then ended, each certified by an authorized officer of
the Borrower. Such balance sheet and statement of income and cash flow
have been prepared in accordance with GAAP and fairly present in all
material respects the financial condition of the Parent, the Borrower and
its subsidiaries, as at the close of business on the date thereof and the
results of operations for the fiscal year then ended. There are no
contingent liabilities of the Parent, the Borrower or any of its
subsidiaries, as of the Funding Date involving material amounts, known to
any officer of the Parent, the Borrower or of any of the Subsidiaries not
disclosed in the balance sheet dated the Balance Sheet Date and the
related notes thereto other than contingent liabilities disclosed to the
Lenders in writing.




      8.4.3. Projections. There has been furnished to the Lenders the
projections of the Borrower and its subsidiaries, which include a
projection of revenue, earnings before interest, taxes, depreciation and
amortization, sources and uses of cash, a funding analysis and
capitalization for the fiscal years ended February 28, 2005 through the
fiscal year ended February 28, 2013, copies of which are attached hereto
as Exhibit D (the “Projections”), which disclose all assumptions made
with respect to general economic, financial and market conditions used in
formulating the Projections. To the knowledge of the Parent, the
Borrower or any of the Subsidiaries as of the Funding Date, no facts
exist that (individually or in the aggregate) would result in any
material change in any of the Projections. The Projections are based
upon reasonable estimates and assumptions at the time made, have been
prepared on the basis of the assumptions stated therein and reflect the
reasonable estimates of the Parent, the Borrower and the Subsidiaries, of
the results of operations and other information projected therein.



     8.5. No Material Adverse Changes, etc. Since the Balance Sheet Date there
has been no event or occurrence which has had a Material Adverse Effect. Since
the Balance Sheet Date, neither the Borrower nor any Subsidiary has made any
Restricted Payment except as set forth on Schedule 8.5 hereto or after the
Funding Date as permitted by §10.4.



     8.6. Franchises, Patents, Copyrights, etc. The Borrower and each of its
Subsidiaries possesses all franchises, patents, copyrights, trademarks, trade
names, 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.



     8.7. Litigation. Except as set forth in Schedule 8.7 hereto, there are no
actions, suits, proceedings or investigations of any kind pending or threatened
against the Borrower or any of its Subsidiaries before any Governmental
Authority, (a) that, could reasonably be expected to, in each case or in the
aggregate, (i) have a Material Adverse Effect or (ii) materially impair the
right of the Borrower and its Subsidiaries, considered as a whole, to carry on
business substantially as now conducted by them, or result in any substantial
liability not adequately covered by insurance, or for which adequate reserves
are not maintained on the consolidated balance sheet of the Parent and its
subsidiaries, or (b) which question the validity of this Credit Agreement or
any of the other Loan Documents, or any action taken or to be taken pursuant
hereto or thereto.



     8.8. No Materially Adverse Contracts, etc. None of the Parent, the
Borrower or any of the Subsidiaries is subject to any Governing Document or
other legal restriction, or any judgment, decree, order, law, statute, rule or
regulation that has or is expected in the future to have a Material Adverse
Effect.



- 45 -









 







None of the Parent, the Borrower or any of the Subsidiaries is a party to
any contract or agreement that has or is expected, in the reasonable judgment
of the Borrower’s officers, to have any Material Adverse Effect.



     8.9. Compliance with Other Instruments, Laws, Status as Senior Debt, etc.
None of the Parent, the Borrower or any of the Subsidiaries is in violation of
any provision of its Governing Documents, or any agreement or instrument to
which it may be subject or by which it or any of its properties may be bound or
any decree, order, judgment, statute, license, rule or regulation, in any of
the foregoing cases in a manner that could reasonably be expected to have a
Material Adverse Effect. The Obligations of the Parent, the Borrower and the
Subsidiaries arising under this Credit Agreement and the other Loan Documents
constitute “Senior Debt” under and as defined in the Subordinated Note
Indenture and shall constitute the equivalent under the Refinancing Note
Indenture; and the incurrence of such Obligations is permitted under §4.09 of
the Subordinated Note Indenture and shall be permitted under the Refinancing
Note Indenture and will not cause a “Default” or “Event of Default” under and
as defined in the Subordinated Note Indenture and the Refinancing Note
Indenture, as applicable.



     8.10. Tax Status. The Parent and the Subsidiaries (a) have made or filed
all federal, state and foreign income and all other tax returns, reports and
declarations required by any jurisdiction to which any of them is subject,
except where failure to have done so could not reasonably be expected to result
in a Material Adverse Effect and (b) have paid all taxes and other governmental
assessments and charges shown or determined to be due on such returns, reports
and declarations, except those being contested in good faith and by appropriate
proceedings and with respect to which adequate reserves in conformity with GAAP
have been provided on the books of the Parent or its Subsidiaries, as the case
may be, and except where failure to do so could not reasonably be expected to
result in a Material Adverse Effect. Except as set forth on Schedule 8.10,
there are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction (except those being contested in good
faith by appropriate proceedings subject to the Borrower or the applicable
Subsidiary having established adequate reserves in conformity with GAAP for the
payment of such disputed taxes and except where the failure to pay such
disputed taxes could not reasonably be expected to result in a Material Adverse
Effect), and none of the officers of the Borrower know of any reasonable basis
for any such claim.



     8.11. No Event of Default. No Default or Event of Default has occurred
and is continuing.



     8.12. Investment Company Acts and Communications Act. None of the Parent,
the Borrower or any of the Subsidiaries is a “holding company”, or a
“subsidiary company” of a “holding company”, or an “affiliate” of a “holding
company”, as such terms are defined in the Public Utility Holding Company Act
of 1935; nor is it an “investment company”, or an “affiliated company” or a
“principal underwriter” of an “investment company”, as such terms are defined
in the Investment Company Act of 1940. The Borrower and each of its
Subsidiaries is in compliance with the Communications Act with regard to alien
control or ownership.



     8.13. Absence of Financing Statements, etc. Except with respect to
Permitted Liens, there is no financing statement, security agreement, chattel
mortgage, real estate mortgage or other document filed or recorded with any
filing records, registry or other public office, that purports to cover, affect
or give notice of any present or possible future Lien on any assets or property
of the Parent, the Borrower or any of the Subsidiaries or any rights relating
thereto.



     8.14. Perfection of Security Interest. All filings, assignments, pledges
and deposits of documents or instruments have been made and all other actions
have been taken that are necessary or advisable, under applicable law, to
establish and perfect the Administrative Agent’s security interest in the
Collateral. The Collateral and the Administrative Agent’s rights with respect
to the Collateral are not subject to any setoff, claims, withholdings or other
defenses. The Borrower or (as the case may be) a Subsidiary party to the
Security Agreement is the owner of the Collateral free from any Lien, except
for Permitted Liens.



- 46 -









 





     8.15. Certain Transactions. Except for arm’s length transactions pursuant
to which the Borrower or any of its Subsidiaries makes payments in the ordinary
course of business upon terms no less favorable than the Borrower or such
Subsidiary could obtain from third parties, none of the officers, directors, or
employees of the Borrower or any of its Subsidiaries is presently a party to
any transaction with the Borrower or any of its Subsidiaries (other than for
services as employees, officers and directors and independent contractors in
the ordinary course of business), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the
Borrower, any corporation, partnership, trust or other entity in which any
officer, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner.



     8.16. Employee Benefit Plans.




      8.16.1. In General. Each Employee Benefit Plan and each Guaranteed
Pension Plan has been maintained and operated in compliance in all
material respects with the provisions of ERISA and all Applicable Pension
Legislation and, to the extent applicable, the Code, including but not
limited to the provisions thereunder respecting prohibited transactions
and the bonding of fiduciaries and other persons handling plan funds as
required by §412 of ERISA. The Borrower has heretofore delivered to the
Administrative Agent the most recently completed annual report, Form
5500, with all required attachments, and actuarial statement required to
be submitted under §103(d) of ERISA, with respect to each Guaranteed
Pension Plan.




      8.16.2. Terminability of Welfare Plans. No Employee Benefit Plan,
which is an employee welfare benefit plan within the meaning of §3(1) or
§3(2)(B) of ERISA, provides benefit coverage subsequent to termination of
employment, except as required by Title I, Part 6 of ERISA or the
applicable state insurance laws. The Borrower may terminate each such
Plan at any time (or at any time subsequent to the expiration of any
applicable bargaining agreement) in the discretion of the Borrower
without liability to any Person other than for claims arising prior to
termination.




      8.16.3. Guaranteed Pension Plans. Each contribution required to be
made to a Guaranteed Pension Plan, whether required to be made to avoid
the incurrence of an accumulated funding deficiency, the notice or lien
provisions of §302(f) of ERISA, or otherwise, has been timely made. No
waiver of an accumulated funding deficiency or extension of amortization
periods has been received with respect to any Guaranteed Pension Plan,
and neither the Borrower nor any ERISA Affiliate is obligated to or has
posted security in connection with an amendment to a Guaranteed Pension
Plan pursuant to §307 of ERISA or §401(a)(29) of the Code. No liability
to the PBGC (other than required insurance premiums, all of which have
been paid) has been incurred by the Borrower or any ERISA Affiliate with
respect to any Guaranteed Pension Plan and there has not been any ERISA
Reportable Event (other than an ERISA Reportable Event as to which the
requirement of 30 days notice has been waived), or any other event or
condition which presents a material risk of termination of any Guaranteed
Pension Plan by the PBGC. Based on the latest valuation of each
Guaranteed Pension Plan (which in each case occurred within twelve months
of the date of this representation), and on the actuarial methods and
assumptions employed for that valuation, the aggregate benefit
liabilities of all such Guaranteed Pension Plans within the meaning of
§4001 of ERISA did not exceed the aggregate value of the assets of all
such Guaranteed Pension Plans, disregarding for this purpose the benefit
liabilities and assets of any Guaranteed Pension Plan with assets in
excess of benefit liabilities.




      8.16.4. Multiemployer Plans. Neither the Borrower nor any ERISA
Affiliate has incurred any material liability (including secondary
liability) to any Multiemployer Plan as a result of a complete or partial
withdrawal from such Multiemployer Plan under §4201 of ERISA or as a
result of a sale of assets described in §4204 of ERISA. Neither the
Borrower nor any ERISA



- 47 -









 






Affiliate has been notified that any Multiemployer Plan is in
reorganization or insolvent under and within the meaning of §4241 or
§4245 of ERISA or is at risk of entering reorganization or becoming
insolvent, or that any Multiemployer Plan intends to terminate or has
been terminated under §4041A of ERISA.



     8.17. Use of Proceeds.




      8.17.1. General. The proceeds of the Loans shall be used for the
following purposes: (a) to refinance all outstanding loans under the
Existing Credit Agreement, (b) to refinance a portion of the outstanding
Subordinated Notes and Senior Discount Notes, so long as at least
$375,000,000 of proceeds have been raised from the issuance of
Refinancing Notes and the net cash proceeds therefrom have been applied
to such refinancing, (c) working capital and general corporate purposes,
(d) funding Permitted Acquisitions, and (e) funding Capital Expenditures
permitted hereunder. The Borrower will obtain Letters of Credit solely
for general corporate purposes.




      8.17.2. Regulation U. No portion of any Loan is to be used, and no
portion of any Letter of Credit is to be obtained, for the purpose of
purchasing or carrying any “margin security” or “margin stock” as such
terms are used in Regulation U of the Board of Governors of the Federal
Reserve System, 12 C.F.R. Part 221.




      8.17.3. Ineligible Securities. No portion of the proceeds of any
Loan is to be used, and no portion of any Letter of Credit is to be
obtained, for the purpose of 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.



     8.18. Environmental Compliance. The Borrower has taken all necessary
steps to investigate the past and present condition and usage of the Real
Estate and the operations conducted thereon and, based upon such diligent
investigation, has determined that:




      (a) none of the Borrower, its Subsidiaries or any operator of the
Real Estate or any operations thereon is in violation, or alleged
violation, of any judgment, decree, order, law, license, rule or
regulation pertaining to environmental matters, including without
limitation, those arising under the Resource Conservation and Recovery
Act, the Comprehensive Environmental Response, Compensation and Liability
Act of 1980 as amended (“CERCLA”), the Superfund Amendments and
Reauthorization Act of 1986, the Federal Clean Water Act, the Federal
Clean Air Act, the Toxic Substances Control Act, or any state, local or
foreign law, statute, regulation, ordinance, order or decree relating to
health, safety or the environment (hereinafter “Environmental Laws”),
which violation could reasonably be expected to have a material adverse
effect on the environment or a Material Adverse Effect;




      (b) neither the Borrower nor any of its Subsidiaries has received
notice from any third party including, without limitation, any
Governmental Authority, (i) that any one of them has been identified by
the United States Environmental Protection Agency (“EPA”) as a
potentially responsible party under CERCLA with respect to a site listed
on the National Priorities List, 40 C.F.R. Part 300 Appendix B; (ii) that
any hazardous waste, as defined by 42 U.S.C. §6903(5), any hazardous
substances as defined by 42 U.S.C. §9601(14), any pollutant or
contaminant as defined by 42 U.S.C. §9601(33) and any toxic substances,
oil or hazardous materials or other chemicals or substances regulated by
any Environmental Laws (“Hazardous Substances”) which any one of them has
generated, transported or disposed of has been found at any site at which
a Governmental Authority has conducted or has ordered that any Borrower
or any of its Subsidiaries conduct a remedial investigation, removal or
other response action pursuant to any Environmental Law; or



- 48 -









 






(iii) that it is or shall be a named party to any claim, action,
cause of action, complaint, or legal or administrative proceeding (in
each case, contingent or otherwise) arising out of any third party’s
incurrence of costs, expenses, losses or damages of any kind whatsoever
in connection with the release of Hazardous Substances except where any
of the foregoing could not reasonably be expected to have a Material
Adverse Effect;




      (c) except as set forth on Schedule 8.18 attached hereto: (i) no
portion of the Real Estate has been used for the handling, processing,
storage or disposal of Hazardous Substances except in accordance with
applicable Environmental Laws; and no underground tank or other
underground storage receptacle for Hazardous Substances is located on any
portion of the Real Estate; (ii) in the course of any activities
conducted by the Borrower, its Subsidiaries or operators of its
properties, no Hazardous Substances have been generated or are being used
on the Real Estate except in accordance with applicable Environmental
Laws, except where any failure to comply could not reasonably be expected
to result in a Material Adverse Effect, (iii) there have been no releases
(i.e. any past or present releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, disposing or
dumping) or threatened releases of Hazardous Substances on, upon, into or
from the properties of the Borrower or its Subsidiaries, which releases
would have a material adverse effect on the value of any of the Real
Estate or adjacent properties or the environment; (iv) to the best of the
Borrower’s knowledge, there have been no releases on, upon, from or into
any real property in the vicinity of any of the Real Estate which,
through soil or groundwater contamination, may have come to be located
on, and which would have a material adverse effect on the value of, the
Real Estate; and (v) in addition, any Hazardous Substances that have been
generated on any of the Real Estate have been transported offsite only by
carriers having an identification number issued by the EPA (or the
equivalent thereof in any foreign jurisdiction), treated or disposed of
only by treatment or disposal facilities maintaining valid permits as
required under applicable Environmental Laws, which transporters and
facilities have been and are, to the best of the Borrower’s knowledge,
operating in compliance with such permits and applicable Environmental
Laws; and




      (d) none of the Borrower and its Subsidiaries, any Mortgaged
Property or any of the other Real Estate is subject to any applicable
Environmental Law requiring the performance of Hazardous Substances site
assessments, or the removal or remediation of Hazardous Substances, or
the giving of notice to any Governmental Authority or the recording or
delivery to other Persons of an environmental disclosure document or
statement by virtue of the transactions set forth herein and contemplated
hereby, or as a condition to the recording of any Mortgage or to the
effectiveness of any other transactions contemplated hereby.



     8.19. Subsidiaries, etc. Schedule 8.19 hereto, as updated from time to
time in accordance with §9.15, sets forth all of the Subsidiaries of the
Parent. Except as set forth on Schedule 8.19, neither the Parent nor any
Subsidiary is engaged in any joint venture or partnership with any other
Person. The jurisdiction of incorporation/formation and principal place of
business of each Subsidiary is listed on Schedule 8.19 hereto.



     8.20. Disclosure. Neither this Credit Agreement nor any of the other Loan
Documents contains any untrue statement of a material fact or omits to state a
material fact (known to the Borrower or any of its Subsidiaries in the case of
any document or information not furnished by it or any of its Subsidiaries)
necessary in order to make the statements herein or therein not misleading.
There is no fact known to the Borrower or any of its Subsidiaries which has had
a Material Adverse Effect, or which is reasonably likely in the future to have
a Material Adverse Effect, exclusive of effects resulting from changes in
general economic conditions, legal standards or regulatory conditions or
changes affecting the broadcasting or publishing industries generally resulting
from new technologies.



     8.21. Licenses and Approvals.



- 49 -









 






      (a) Each of the Borrower and its Subsidiaries has all requisite
power and authority and Necessary Authorizations to hold the FCC Licenses
and to own and operate its Stations and to carry on its businesses as now
conducted.




      (b) Set forth in Schedule 8.21 hereto, as updated from time to time
in accordance with §10.5, is a complete description of all FCC Licenses
of the Borrower and/or its Subsidiaries and the dates on which such FCC
Licenses expire. Complete and correct copies of all such FCC licenses
have been delivered to the Administrative Agent. Each such FCC License
which is necessary to the operation of the business of the Borrower or
any of its Subsidiaries is validly issued and in full force and effect.
The Borrower and each of its Subsidiaries has fulfilled and performed in
all material respects all of its obligations with respect to each such
FCC License except in respect of findings of violations, or claims
alleging violations, by the Borrower or such Subsidiary of FCC indecency
standards (“Indecency Claims”), provided that such Indecency Claims could
not, in the aggregate, reasonably be expected to have a Material Adverse
Effect and provided further that the Borrower or such Subsidiary is
taking all reasonable and appropriate steps to contest or mitigate its
potential liabilities in respect of such Indecency Claims and has set
aside on its books adequate reserves in conformity with GAAP with respect
thereto. No event has occurred which: (i) has resulted in, or after
notice or lapse of time or both would result in, revocation or
termination of any FCC License, 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 FCC License, except for those the failure to be in full force and
effect could not reasonably be expected to cause an Event of Default
pursuant to §14.1(t) and so long as the Borrower or the applicable
Subsidiary shall have complied with §9.10(b)(iv). No material license or
franchise, other than the FCC Licenses described in Schedule 8.21 which
have been obtained, is necessary for the operation of the business
(including the Stations) of the Borrower or any of its Subsidiaries as
now conducted.




      (c) Except as set forth on Schedule 8.21, as updated from time to
time pursuant to §10.5, and except in respect of Indecency Claims,
provided that such Indecency Claims could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect and provided
further that the Borrower or such Subsidiary is taking all reasonable and
appropriate steps to contest or mitigate its potential liabilities in
respect of such Indecency Claims and has set aside on its books adequate
reserves in conformity with GAAP with respect thereto, none of the
Borrower or any of its Subsidiaries is a party to or has knowledge of any
investigation, notice of violation, order or complaint issued by or
before any Governmental Authority, including the FCC, or of any other
proceedings (other than proceedings relating to the radio or television
broadcasting industry generally) which could in any manner threaten or
adversely affect the validity or continued effectiveness of the FCC
Licenses of the Borrower and its Subsidiaries taken as a whole or the
business of the Borrower and its Subsidiaries taken as a whole. None of
the Borrower or any of its Subsidiaries has reason to believe that any of
the FCC Licenses described in Schedule 8.21, as updated from time to time
pursuant to §10.5, will not be renewed, except for those the failure to
be in full force and effect after the Funding Date could not reasonably
be expected to have a Material Adverse Effect. Each of the Borrower and
its Subsidiaries has filed all material reports, applications, documents,
instruments and information required to be filed by it pursuant to
applicable rules and regulations or requests of every regulatory body
having jurisdiction over any of its FCC Licenses or the activities or
business of such Person with respect thereto and has timely paid all FCC
annual regulatory fees assessed with respect to its FCC Licenses.




      (d) All FCC Licenses and other licenses, permits and approvals
relating to the Stations are held by a License Subsidiary. No License
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



- 50 -









 






Borrower or (D) owes any Indebtedness (other than (x) Indebtedness
to the Administrative Agent and the Lenders pursuant to the Guaranty and
(y) contingent obligations pursuant to the Subordinated Guaranties or
Subordinated Debt consisting of guaranties of Additional Subordinated
Debt) to any Person other than the Borrower.



     8.22. Material Agreements. 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.



     8.23. Solvency. As of the date on which this representation and warranty
is made or deemed made, each of the Parent, the Borrower and the Subsidiaries
is Solvent, both before and after giving effect to the transactions
contemplated hereby consummated on such date and to the incurrence of all
Indebtedness and other obligations incurred on such date in connection herewith
and therewith.



     8.24. Excluded Subsidiaries. The entities set forth in clause (b) 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. The
entity set forth in clause (d) of the definition of “Excluded Subsidiaries” is
a fifty-one percent (51%) owned limited liability company. The primary
business of Country Sampler Stores LLC is the retail sale of products like
those advertised in “Country Sampler Magazine”. The Austin Partnership is a
Texas limited partnership, 49.69443% of which is owned by the Borrower. RAM is
a Texas limited liability company, 50.1% of which is owned by the Borrower.



9. AFFIRMATIVE COVENANTS.




     The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit, Note or other Obligation is
outstanding or any Lender has any obligation to make any Loans or the
Administrative Agent has any obligation to issue, extend or renew any Letters
of Credit:



     9.1. Punctual Payment. The Borrower will duly and punctually pay or cause
to be paid the principal and interest on the Loans, all Reimbursement
Obligations, the Letter of Credit Fees, the Commitment Fees and all other fees
and amounts provided for in this Credit Agreement and the other Loan Documents
to which the Borrower or any of its Subsidiaries is a party, all in accordance
with the terms of this Credit Agreement and such other Loan Documents.



     9.2. Maintenance of Office. (a) The Borrower will, and will cause each
of the Operating Subsidiaries to, maintain its chief executive office in
Indianapolis, Indiana, and (b) the Borrower will cause each of the License
Subsidiaries to maintain its chief executive office in Burbank, California, or,
in each case, at such other place in the United States of America as the
Borrower shall designate upon written notice to the Administrative Agent, where
notices, presentations and demands to or upon the Borrower in respect of the
Loan Documents to which the Borrower is a party may be given or made.



     9.3. Records and Accounts. The Borrower will (a) keep, and cause each of
its Subsidiaries to keep, true and accurate records and books of account in
which full, true and correct entries will be made in accordance with GAAP, (b)
maintain adequate accounts and reserves for all taxes (including income taxes),
depreciation, depletion, obsolescence and amortization of its properties and
the properties of its Subsidiaries, contingencies, and other reserves, and (c)
at all times engage Ernst & Young LLP or other independent certified public
accountants reasonably satisfactory to the Administrative Agent as the



- 51 -









 







independent certified public accountants of the Borrower and its
Subsidiaries and will not permit more than thirty (30) days to elapse between
the cessation of such firm’s (or any successor firm’s) engagement as the
independent certified public accountants of the Borrower and its Subsidiaries
and the appointment in such capacity of a successor firm as shall be
satisfactory to the Administrative Agent.



     9.4. Financial Statements, Certificates and Information. The Borrower
will deliver to each of the Lenders:




      (a) as soon as practicable, but in any event not later than eighty
(80) days after the end of each fiscal year of the Parent, other than as
set forth in §9.4(f) as it relates to audited financial statements for
the fiscal year ended February 29, 2004, the audited consolidated balance
sheet of the Parent and its subsidiaries, as at the end of such year, and
the related audited consolidated statements of income and audited
consolidated statements of cash flow, each setting forth in comparative
form the figures for the previous fiscal year and all such consolidated
statements to be in reasonable detail, prepared in accordance with GAAP
and the requirements of the Securities and Exchange Commission (the
“SEC”), and certified without qualification and without an expression of
uncertainty as to the ability of the Parent, the Borrower or any of the
Subsidiaries to continue as going concerns, by Ernst & Young LLP or by
other independent certified public accountants reasonably satisfactory to
the Administrative Agent, together with a written statement from such
accountants to the effect that, in making the examination necessary to
said certification, they have obtained no knowledge of any Default or
Event of Default related to or arising from accounting matters, or, if
such accountants shall have obtained knowledge of any then existing
Default or Event of Default they shall disclose in such statement any
such Default or Event of Default; provided that such accountants shall
not be liable to the Lenders for failure to obtain knowledge of any
Default or Event of Default;




      (b) as soon as practicable, but in any event not later than fifty
(50) days after the end of each of the fiscal quarters of the Parent,
copies of the unaudited consolidated balance sheets of the Parent and its
subsidiaries as at the end of such quarter, and the related consolidated
statements of income and cash flows for the fiscal quarter then ended,
all in reasonable detail and prepared in accordance with GAAP and SEC
requirements, together with a certification by the principal financial or
accounting officer of the Borrower that the information contained in such
financial statements fairly presents the financial position of the
Parent, the Borrower and their respective subsidiaries on the date
thereof (subject to year-end adjustments);




      (c) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, (i) a statement certified
by the principal financial or accounting officer of the Borrower in
substantially the form of Exhibit E hereto (a “Compliance Certificate”)
and certifying that no Default or Event of Default is then continuing or
describing the nature and duration of any then continuing Default or
Event of Default and setting forth in reasonable detail computations
evidencing compliance with the covenants contained in §11 and (if
applicable) reconciliations to reflect changes in GAAP since the Balance
Sheet Date, and (ii) a schedule in form and detail reasonably
satisfactory to the Administrative Agent of computations of Consolidated
Operating Cash Flow and other financial covenant-related calculations
prepared by the principal financial or accounting officer of the Borrower
detailing the adjustments made to exclude Excluded Subsidiaries from such
computations;




      (d) promptly upon completion thereof and in any event no later than
eighty (80) days after the beginning of each fiscal year of the Borrower,
the Borrower’s annual operating budget in the form of consolidated
financial projections for such fiscal year and prepared on a quarterly
basis and setting forth projected operating results for each quarter in
such fiscal year and for the fiscal year as a whole, including
projections of operating cash flow together with a



- 52 -









 






quarterly itemization of estimated taxes and Capital Expenditures
for such fiscal year, which are prepared on the basis of reasonable
assumptions;




      (e) from time to time such other financial data and information with
respect to the condition or operations, financial or otherwise, of the
Parent, the Borrower and the subsidiaries, including Excluded
Subsidiaries (including accountants’ management letters) as the
Administrative Agent or any Lender may reasonably request; and




      (f) within five (5) days from the Funding Date, the audited
consolidated balance sheet of the Parent, the Borrower and its
subsidiaries, as at the Balance Sheet Date, and the related consolidated
statements of income and cash flow for the fiscal year then ended, in
each case, certified by both the Parent’s independent certified public
accountants and an authorized officer of the Borrower. Such balance
sheet and statement of income and cash flow shall not be materially
different from the financials delivered to the Lenders on the Funding
Date in accordance with §12.8 and shall have been prepared in accordance
with GAAP and shall fairly present in all material respects the financial
condition of the Parent, the Borrower and its subsidiaries, as at the
close of business on the Balance Sheet Date and the results of operations
for the fiscal year then ended. There shall be no contingent liabilities
of the Parent, the Borrower or any of its subsidiaries, as of the Funding
Date involving material amounts, known to any officer of the Parent, the
Borrower or of any of the Subsidiaries not disclosed in the balance sheet
dated the Balance Sheet Date and the related notes thereto other than
contingent liabilities disclosed to the Lenders in writing.



     9.5. Notices.




      9.5.1. Defaults. The Borrower will promptly notify the
Administrative Agent and each of the Lenders in writing of the occurrence
of any Default or Event of Default, together with a reasonably detailed
description thereof, and the actions the Borrower proposes to take with
respect thereto. If any Person shall give any notice or take any other
action in respect of a claimed default (whether or not constituting an
Event of Default) under this Credit Agreement or any other note, evidence
of indebtedness, indenture or other obligation in an amount equal to or
greater than $5,000,000 to which or with respect to which the Parent, the
Borrower or any of the Subsidiaries is a party or obligor, whether as
principal, guarantor, surety or otherwise, the Borrower shall forthwith
give written notice thereof to the Administrative Agent and each of the
Lenders, describing the notice or action and the nature of the claimed
default.




      9.5.2. Environmental Events. The Borrower will promptly give notice
to the Administrative Agent and each of the Lenders (a) of any violation
of any Environmental Law that the Borrower or any of its Subsidiaries
reports in writing or is reportable by such Person in writing (or for
which any written report supplemental to any oral report is made) to any
Governmental Authority and (b) upon becoming aware thereof, of any
inquiry, proceeding, investigation, or other action, including a notice
from any agency of potential environmental liability, of any Governmental
Authority that could have a Material Adverse Effect.




      9.5.3. Notification of Claim against Collateral. The Borrower will,
immediately upon becoming aware thereof, notify the Administrative Agent
and each of the Lenders in writing of any setoff, claims (including, with
respect to the Real Estate, environmental claims), withholdings or other
defenses to which any of the Collateral, or the Administrative Agent’s
rights with respect to the Collateral, are subject.




      9.5.4. Notice of Litigation and Judgments. The Borrower will, and
will cause each of its Subsidiaries to, give notice to the Administrative
Agent and each of the Lenders in writing within fifteen (15) days of
becoming aware of any litigation or proceedings threatened in writing



- 53 -









 






or any pending litigation and proceedings affecting the Parent, the
Borrower or any of the Subsidiaries or to which any such Person is or
becomes a party involving an uninsured claim against any such Person that
could reasonably be expected to have a Material Adverse Effect and
stating the nature and status of such litigation or proceedings. The
Borrower will, and will cause each of its Subsidiaries to, give notice to
the Administrative Agent and each of the Lenders, in writing, in form and
detail reasonably satisfactory to the Administrative Agent, within ten
(10) days of any judgment not covered by insurance, final or otherwise,
against the Parent, the Borrower or any of the Subsidiaries in an amount
in excess of $5,000,000.




      9.5.5. Notice of SEC Filings, etc. The Borrower will, and will
cause each of its Subsidiaries to, contemporaneously with the filing or
mailing thereof, give notice to the Administrative Agent, of such filing
or mailing of (i) all material of a financial nature filed with the SEC

(including any registration statements) or sent to the stockholders of
the Parent or the Borrower, as applicable, and (ii) 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.



     9.6. Legal Existence; Conduct of Business; Maintenance of Properties.
Except as otherwise permitted under §10.5.1(a), the Borrower will do or cause
to be done all things necessary to preserve and keep in full force and effect
its legal existence, rights and franchises and those of its Subsidiaries and
will not, and will not cause or permit any of its Subsidiaries to, convert to a
limited liability company or a limited liability partnership without providing
at least thirty (30) days’ prior written notice to the Administrative Agent.
Except as otherwise permitted under §10.5, the Borrower (i) will cause all of
its properties and those of its Subsidiaries used or useful in the conduct of
its business or the business of its Subsidiaries to be maintained and kept in
good condition, repair and working order and supplied with all necessary
equipment, (ii) will cause to be made 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, (iii)
will, and will cause each of 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, (iv) will cause each of the 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, (v) will, and will cause each of its Subsidiaries to, 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 (vi) will, and will cause each of its
Subsidiaries to, continue to engage primarily in the businesses now conducted
by them and in related businesses; provided that nothing in this §9.6 shall
prevent the Borrower from discontinuing the operation and maintenance of any of
its properties or any of those of its Subsidiaries if such discontinuance is,
in the judgment of the Borrower, desirable in the conduct of its or their
business and that do not in the aggregate have a Material Adverse Effect.



     9.7. Insurance. The Borrower will, and will cause each of its
Subsidiaries to, maintain with financially sound and reputable insurers
insurance with respect to its properties and business against such casualties
and contingencies as shall be in accordance with the general practices of
businesses engaged in similar activities in similar geographic areas and in
amounts, containing such terms, in such forms and for such periods as may be
reasonable and prudent and in accordance with the terms of the Security
Agreement, and to maintain business interruption insurance in form reasonably
satisfactory in all respects to the Administrative Agent. In the event of any
failure by the Borrower or any of its Subsidiaries to provide and maintain
insurance as required herein or in the Security Agreement, the Administrative
Agent may after notice to the Borrower to such effect, provide such insurance
and charge the amount thereof to the Borrower and the Borrower hereby promises
to pay to the Administrative Agent on demand the amount of any disbursements
made by the Administrative Agent for such purpose. Within ninety (90) days of
the end of each fiscal year of the Borrower, the Borrower shall furnish to the
Administrative Agent certificates or other evidence satisfactory to the
Administrative Agent of compliance with the foregoing provisions.



- 54 -









 





     9.8. Taxes. The Borrower will, and will cause each of its Subsidiaries
to, duly pay and discharge, or cause to be paid and discharged, before the same
shall become overdue, all taxes, assessments and other governmental charges
(other than taxes, assessments and other governmental charges imposed by
foreign jurisdictions that in the aggregate are not material to the business or
assets of the Borrower on an individual basis or of the Borrower and its
Subsidiaries on a consolidated basis) imposed upon it and its Real Estate,
sales and activities, or any part thereof, or upon the income or profits
therefrom, as well as all claims for labor, materials, or supplies that if
unpaid might by law become a Lien or charge upon any of its property unless
failure to pay could not reasonably be expected to cause a Material Adverse
Effect; provided that any such tax, assessment, charge, levy or claim need not
be paid if the validity or amount thereof is then being contested in good faith
by appropriate proceedings and if the Borrower or such Subsidiary shall have
set aside on its books adequate reserves in conformity with GAAP with respect
thereto; and provided further that the Borrower and each Subsidiary of the
Borrower will pay all such taxes, assessments, charges, levies or claims
forthwith upon the commencement of proceedings to foreclose any Lien that may
have attached as security therefor.



     9.9. Inspection of Properties and Books, etc.




      9.9.1. General. The Borrower shall permit the Lenders or any of the
Lenders’ other designated representatives to visit and inspect any of the
properties of the Borrower or any of its Subsidiaries, to examine the
books of account of the Borrower and its Subsidiaries (and to make copies
thereof and extracts therefrom), and to discuss the affairs, finances and
accounts of the Borrower and its Subsidiaries with, and to be advised as
to the same by, its and their officers, all upon reasonable advance
notice to the Borrower and at such reasonable times and intervals as the
Administrative Agent or any Lender may reasonably request.




      9.9.2. Appraisals. If an Event of Default shall have occurred and
be continuing, upon the request of the Administrative Agent, the Borrower
will obtain and deliver to the Administrative Agent appraisal reports in
form and substance and from appraisers satisfactory to the Administrative
Agent, stating (a) the then current fair market, orderly liquidation and
forced liquidation values of one or more of the Stations owned by the
Borrower or its Subsidiaries, business units that hold the publishing
assets and/or the Mortgaged Properties and (b) the then current business
value of each of the Borrower and its Subsidiaries. All such appraisals
shall be conducted and made at the expense of the Borrower.




      9.9.3. Communications with Accountants. Each of the Parent and the
Borrower authorizes the Administrative Agent and, if accompanied by the
Administrative Agent, the Lenders to communicate directly with such
Person’s independent certified public accountants and authorizes such
accountants to disclose to the Administrative Agent and the Lenders any
and all financial statements and other supporting financial documents and
schedules including copies of any management letter with respect to the
business, financial condition and other affairs of the Parent, the
Borrower or any of the Subsidiaries. At the request of the
Administrative Agent, the Parent and the Borrower shall deliver a letter
addressed to such accountants instructing them to comply with the
provisions of this §9.9.3.



     9.10. Compliance with Laws, Contracts, Licenses, and Permits.




      (a) The Borrower will, and will cause each of its Subsidiaries to,
comply with (i) the applicable laws and regulations wherever its business
is conducted, including all Environmental Laws and the Communications
Act, (ii) the provisions of its Governing Documents, (iii) all agreements
and instruments by which it or any of its properties may be bound and
(iv) all applicable decrees, orders, and judgments, unless failure to
comply could not reasonably be expected to cause 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



- 55 -









 






required in order that the Borrower or any of its Subsidiaries may
fulfill any of its obligations hereunder or any of the other Loan
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.




      (b) The Borrower will, and will cause each of its Subsidiaries to,
(i) operate its Stations, unless failure to comply could not 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 material
to the operations of its Stations, (iii) use its reasonable best efforts
to defend any proceedings which could result in the termination,
forfeiture or non-renewal of any FCC License, 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 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 of its franchises, licenses
(including FCC Licenses), rights, permits, consents or other
authorizations pursuant to which the Borrower or any of the Borrower’s
Subsidiaries operates any Station, (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.



     9.11. Employee Benefit Plans. The Borrower will (a) promptly upon filing
the same with the Department of Labor or Internal Revenue Service, upon request
of the Administrative Agent, furnish to the Administrative Agent a copy of the
most recent actuarial statement required to be submitted under §103(d) of ERISA
and Annual Report, Form 5500, with all required attachments, in respect of each
Guaranteed Pension Plan, (b) promptly upon receipt or dispatch, furnish to the
Administrative Agent any notice, report or demand sent or received in respect
of a Guaranteed Pension Plan under §§302, 4041, 4042, 4043, 4063, 4065, 4066
and 4068 of ERISA, or in respect of a Multiemployer Plan, under §§4041A, 4202,
4219, 4242, or 4245 of ERISA and (c) promptly upon request of the
Administrative Agent, furnish to the Administrative Agent a copy of all
actuarial statements required to be submitted under all Applicable Pension
Legislation.



     9.12. Use of Proceeds. The Borrower will use the proceeds of the Loans
and obtain Letters of Credit solely for the purposes set forth in §8.17.1.



     9.13. Additional Collateral. The Borrower will, and will cause each of
its Subsidiaries to, from time to time at its own cost and expense, promptly
secure or cause to be secured the Obligations by creating or causing to be
created in favor of the Administrative Agent for the benefit of the Lenders and
the Administrative Agent perfected security interests (subject only to
Permitted Liens) with respect to all inventory, receivables, equipment,
accounts, copyrights, patents, trademarks, licenses, other general intangibles,
Real Estate and other assets of the Borrower and such Subsidiaries (other than
Excluded Assets), whether now owned or hereafter acquired, to the extent the
Administrative Agent shall so request. All such security interests will be
created under security agreements, mortgages and other instruments and
documents in form and substance reasonably satisfactory to the Administrative
Agent, and the Borrower shall deliver to the Administrative Agent all such
instruments and documents (including, without limitation, legal opinions, title
insurance policies and lien searches) as the Administrative Agent shall
reasonably request to evidence the satisfaction of the obligations created by
this §9.13. The Borrower agrees to provide such evidence as the Administrative
Agent shall reasonably request as to the perfection and priority of such
security interests (subject only to Permitted Liens). The Borrower shall
promptly notify the Administrative Agent in the event the Borrower or any
Subsidiary acquires any Collateral not otherwise



- 56 -









 







subject to (a) the first priority perfected security interest of the
Administrative Agent pursuant to existing Security Documents or (b) an
exception or an exclusion expressly permitted hereunder.



     9.14. Interest Rate Protection. No later than three hundred sixty five
(365) days from the date hereof, the Borrower will purchase or enter into an
interest cap or swap or other interest rate protection agreements having a term
of not less than two (2) years as shall be necessary to cap or fix the interest
cost to the Borrower with respect to not less than thirty percent (30%) of
Consolidated Total Funded Debt outstanding at such time, and from time to time
thereafter so long as the Total Leverage Ratio as of the end of the fiscal
quarter most recently ended is greater than or equal to 6.00:1.00, the Borrower
shall purchase or enter into an additional interest cap or swap or other
additional interest rate protection agreements as shall be necessary to cap or
fix the interest cost to the Borrower with respect to not less than thirty
percent (30%) of Consolidated Total Funded Debt outstanding from time to time
during any such period thereafter, in each case at rates and on terms and
conditions reasonably satisfactory to the Administrative Agent.



     9.15. Additional Subsidiaries. In the event that, after the date hereof,
the Parent, the Borrower or any Subsidiary creates any new Subsidiary or
acquires a new Subsidiary in accordance with §10.5.1 or otherwise or in the
event that the Borrower exercises its option to purchase the remaining Capital
Stock of RAM and the Austin Partnership pursuant to the Sinclair Definitive
Agreement, (a) such new Subsidiary or (as the case may be) RAM and the Austin
Partnership shall, concurrently with such event or as soon as practicable
thereafter, execute and deliver to the Administrative Agent an instrument of
joinder and accession, in form and substance reasonably satisfactory to the
Administrative Agent, pursuant to which such Person shall join the applicable
Security Documents as if such Person was an original signatory thereto, and (b)
the Parent, the Borrower, the applicable Subsidiary and/or such new Subsidiary
or (as the case may be) RAM and the Austin Partnership shall deliver such other
instruments and documents, including without limitation Perfection
Certificates, UCC financing statements and stock certificates representing all
of the issued and outstanding Capital Stock of such new Subsidiary or (as the
case may be) RAM and the Austin Partnership with accompanying stock powers duly
executed in blank, in each case required to be executed or delivered pursuant
to such Security Documents in order to grant to or maintain the Administrative
Agent’s first priority perfected security interest in and to the assets of and
the Capital Stock issued by such Person. Further, contemporaneously with the
formation or acquisition of such new Subsidiary or the exercise of the option
to purchase the remaining Capital Stock of RAM and the Austin Partnership, the
Parent, the Borrower, the applicable Subsidiary and/or such new Subsidiary or
(as the case may be) RAM and the Austin Partnership shall execute and/or
deliver to the Administrative Agent such other documentation as the
Administrative Agent may reasonably request in furtherance of the intent of
this §9.15, including without limitation an updated Schedule 8.19 hereto and
documentation of the type required to be supplied by the Parent, the Borrower
and the Subsidiaries as a condition precedent to the initial Loans made
hereunder pursuant to §12, as applicable to such new Subsidiary or Permitted
Acquisition or (as the case may be) RAM and the Austin Partnership.



     9.16. Refinancing Note Proceeds. The Borrower shall apply the net cash
proceeds from the issuance of the Refinancing Notes in combination with
proceeds of the Loans to refinance all outstanding Subordinated Notes (and any
related premiums) and to refinance all or a portion of the outstanding Senior
Discount Notes (and any related premiums).



     9.17. Further Assurances. The Borrower will, and will cause each of its
Subsidiaries to, cooperate with the Lenders and the Administrative Agent and
execute such further instruments and documents as the Lenders or the
Administrative Agent shall reasonably request to carry out to their
satisfaction the transactions contemplated by this Credit Agreement and the
other Loan Documents.



10. CERTAIN NEGATIVE COVENANTS.




     The Parent and the Borrower covenant and agree that, so long as any Loan,
Unpaid Reimbursement Obligation, Letter of Credit, Note or other Obligation is
outstanding or any Lender has any



- 57 -










 







obligation to make any Loans or the Administrative Agent has any
obligations to issue, extend or renew any Letters of Credit:



     10.1. Restrictions on Indebtedness. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume, guarantee or be or
remain liable, contingently or otherwise, with respect to any Indebtedness
other than:




      (a) Indebtedness owing to the Lenders and the Agents arising under
any of the Loan Documents;




      (b) current liabilities of the Borrower or such Subsidiary
(including under any operating leases and studio and tower leases)
incurred in the ordinary course of business not incurred through (i) the
borrowing of money, or (ii) the obtaining of credit except for credit on
an open account basis customarily extended and in fact extended in
connection with normal purchases of goods and services;




      (c) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the ordinary
course of business;




      (d) Indebtedness in respect of (i) judgments or awards that have
been in force for less than the applicable period for taking an appeal so
long as execution is not levied thereunder or in respect of which the
Borrower or such Subsidiary (as the case may be) shall at the time in
good faith be prosecuting an appeal or proceedings for review and in
respect of which a stay of execution shall have been obtained pending
such appeal or review, (ii) final judgments against the Borrower or any
of its Subsidiaries that in the aggregate at any time do not exceed
$5,000,000 and (iii) claims which are currently being contested in good
faith by appropriate proceedings if adequate reserves shall have been set
aside with respect thereto;




      (e) Subordinated Debt; provided that, in the case of the issuance by
the Borrower of the Refinancing Notes, (i) the Borrower applies the net
cash proceeds of such issuance in accordance with §9.16, (ii) no Default
or Event of Default has occurred and is continuing hereunder at the time
of such issuance or would result after giving effect thereto, (iii) in
the event the Borrower intends, on or about the Funding Date, to use a
portion of the proceeds from such issuance to refinance all or any
portion of the Senior Discount Notes (assuming all of the Subordinated
Notes have first been refinanced), the Total Leverage Ratio as of the
last day of the fiscal quarter ended immediately prior to the Funding
Date (calculated on a pro forma basis after giving effect to such
issuance) shall be less than 7.25:1.00, (iv) the Obligations shall
constitute “Senior Debt” or the equivalent under the Refinancing Note
Indenture and the incurrence of the Obligations shall be permitted under
the terms of such Refinancing Note Indenture and will not cause a default
or event of default thereunder, and (v) all documents, instruments and
agreements executed by the Borrower and any of its Subsidiaries in
connection with such issuance shall be in form and substance reasonably
satisfactory to the Administrative Agent; and provided further that, in
the case of the incurrence of Additional Subordinated Debt by the
Borrower or any Subsidiary, (x) the net cash proceeds of such Additional
Subordinated Debt shall be applied in accordance with §4.4 and (y) no
Default or Event of Default has occurred and is continuing at the time of
the incurrence of such Additional Subordinated Debt or would result after
giving effect thereto;




      (f) Indebtedness (i) incurred in connection with, and within 180
days of, the acquisition after the date hereof of any real or personal
property by the Borrower or such Subsidiary or under any Capitalized
Lease or (ii) assumed by the Borrower or any of its Subsidiaries in
connection with a Permitted Acquisition, provided that (x) the aggregate
principal amount of such Indebtedness of the Borrower and its
Subsidiaries shall not exceed the aggregate amount of $75,000,000 at any
one time; (y) the amount of such Indebtedness does not exceed the



- 58 -









 






value of the property so acquired; and (z) with respect to clause
(ii) above, the assets securing such Indebtedness are limited to the
assets so acquired or which secured the Indebtedness at the time it was
assumed so long as such liens were not granted or created in anticipation
of such assumption;




      (g) Indebtedness in respect of interest rate agreements (whether
from fixed to floating or from floating to fixed), swaps or similar
arrangements entered into pursuant to §9.14 or designed to manage
interest rates or interest rate risk in connection with this Credit
Agreement, the Refinancing Notes or any other Indebtedness for borrowed
money evidenced by bonds, debentures or other similar instruments owed by
the Borrower or any of its Subsidiaries;




      (h) Indebtedness existing on the date hereof and listed and
described on Schedule 10.1 hereto;




      (i) Indebtedness of a Subsidiary of the Borrower owing to the
Borrower or of the Borrower or any Subsidiary to any wholly-owned
Subsidiary of the Borrower;




      (j) Indebtedness in respect of taxes, assessments, governmental
charges or levies and claims for labor, materials and supplies to the
extent that payment therefor shall not at the time be required to be made
in accordance with the provisions of §9.8; and




      (k) other unsecured Indebtedness in an aggregate amount outstanding
at any one time not to exceed $150,000,000, provided that no Default or
Event of Default has occurred and is continuing at the time of the
incurrence of such unsecured Indebtedness or would result after giving
effect thereto.



     10.2. Restrictions on Liens.




      10.2.1. Permitted Liens. The Borrower will not, and will not permit
any of its Subsidiaries to, (a) create or incur or suffer to be created
or incurred or to exist any Lien upon any of its property or assets of
any character whether now owned or hereafter acquired, or upon the income
or profits therefrom; (b) transfer any of such property or assets or the
income or profits therefrom outside the ordinary course of business for
the purpose of subjecting the same to the payment of Indebtedness or
performance of any other obligation in priority to payment of its general
creditors; (c) acquire, or agree or have an option to acquire, any
property or assets upon conditional sale or other title retention or
purchase money security agreement, device or arrangement; (d) suffer to
exist for a period of more than thirty (30) days after the same shall
have been incurred any Indebtedness or claim against it that if unpaid
might by law or upon bankruptcy or insolvency, or otherwise, be given any
priority whatsoever over its general creditors (other than in respect of
de minimus amounts); or (e) sell, assign, pledge or otherwise transfer
any “receivables” as defined in clause (g) of the definition of the term
“Indebtedness,” with or without recourse (other than in connection with
the disposition of the business operations of such Person relating
thereto or a disposition of defaulted receivables for collection and not
as a financing arrangement); provided that the Borrower or any of its
Subsidiaries may create or incur or suffer to be created or incurred or
to exist:




      (i) Liens in favor of the Borrower on all or part of the assets of
Subsidiaries of the Borrower securing Indebtedness owing by Subsidiaries
of the Borrower to the Borrower;




      (ii) Liens to secure taxes, assessments and other government charges
in respect of obligations not overdue or that are being diligently
contested in good faith and in respect of which appropriate reserves have
been set aside or Liens on properties to secure claims for labor,
material or supplies in respect of obligations not overdue or that are
being diligently contested in good faith and in respect of which
appropriate reserves have been set aside;



- 59 -









 






      (iii) deposits or pledges made in connection with, or to secure
payment of, workmen’s compensation, unemployment insurance, old age
pensions or other social security obligations which are not overdue;




      (iv) Liens on properties in respect of judgments or awards that have
been in force for less than the applicable period for taking an appeal so
long as execution is not levied thereunder or in respect of which the
Borrower or such Subsidiary (as the case may be) shall at the time in
good faith be prosecuting an appeal or proceedings for review and in
respect of which a stay of execution shall have been obtained pending
such appeal or review, the Indebtedness with respect to which is
permitted by §10.1(d);




      (v) Liens of carriers, warehousemen, mechanics and materialmen, and
other like Liens on properties, in existence less than one hundred twenty
(120) days from the date of creation thereof in respect of obligations
not overdue;




      (vi) encumbrances on Real Estate consisting of easements, rights of
way, zoning restrictions, restrictions on the use of real property and
defects and irregularities in the title thereto, landlord’s or lessor’s
liens and other minor Liens, provided that none of such Liens (A)
interferes materially with the use of the property affected in the
ordinary conduct of the business of the Borrower and its Subsidiaries,
and (B) individually or in the aggregate has a Material Adverse Effect;




      (vii) Liens existing on the date hereof and listed on Schedule 10.2
hereto;




      (viii) purchase money security interests in or purchase money
mortgages on real or personal property, other than Mortgaged Properties
acquired after the date hereof, to secure Capitalized Leases or purchase
money Indebtedness, in each case of the type and amount permitted by
§10.1(f), which security interests or mortgages cover only the real or
personal property so acquired or leased;




      (ix) Liens on each Mortgaged Property as and to the extent permitted
by the Mortgage applicable thereto; and




      (x) Liens in favor of the Administrative Agent for the benefit of
the Lenders and the Administrative Agent under the Loan Documents and any
Interest Rate Agreements with a Lender;




      (xi) Liens on leasehold interests created by the Borrower or any of
its Subsidiaries, as lessee, in favor of any mortgagee of the leased
premises to the extent not prohibited by the terms of the lease;




      (xii) Liens securing Indebtedness permitted by
§10.1(f)(ii);




      (xiii) Liens constituting leasehold or license interests held by a
lessee or licensee in respect of leases or licenses made by the Borrower
or any of its Subsidiaries as lessor or licensor with respect to
intellectual property, space or broadcast towers or sub-channel or
broadcast spectrum or similar leases or licenses in each case entered
into by the Borrower or such Subsidiary in the ordinary course of its
business consistent with past practices;




      (xiv) Liens constituting leasehold or similar interests of
sublessees, time share participants or other similar users in respect of
any aircraft owned or leased by the Borrower or any Subsidiary; and



- 60 -









 






      (xv) Liens constituting options of Persons other than the Borrower
or any Subsidiary to purchase Capital Stock of any non-wholly owned
Subsidiary.




      10.2.2. Restrictions on Negative Pledges and Upstream Limitations.
The Borrower will not, nor will it permit any of its Subsidiaries to, (a)
enter into or permit to exist any arrangement or agreement (other than
the Credit Agreement and the other Loan Documents) which directly or
indirectly prohibits the Borrower or any of its Subsidiaries 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
to the extent permitted under §10.2.1(viii)), or (b) enter into any
agreement, contract or arrangement (excluding the Credit Agreement and
the other Loan Documents) restricting the ability of any Subsidiary of
the Borrower to pay or make dividends or distributions in cash or kind to
the Borrower, to make loans, advances or other payments of any nature to
the Borrower, or to make transfers or distributions of all or any part of
its assets to the Borrower; in each case other than (i) restrictions on
specific assets which assets are the subject of purchase money security
interests to the extent permitted under §10.2.1(viii), and (ii) customary
anti-assignment provisions contained in leases and licensing agreements
entered into by the Borrower or such Subsidiary in the ordinary course of
its business and (iii) property subject to a pending Asset Sale which
would be permitted under §10.5.2 if and from which an executed purchase
agreement has been delivered to the Administrative Agent.



     10.3. Restrictions on Investments. The Borrower will not, and will not
permit any of its Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except Investments in:




      (a) marketable direct or guaranteed obligations of the United States
of America that mature within one (1) year from the date of purchase by
the Borrower;




      (b) demand deposits, certificates of deposit, bank acceptances and
time deposits of United States banks having total assets in excess of
$1,000,000,000;




      (c) securities commonly known as “commercial paper” issued by a
corporation organized and existing under the laws of the United States of
America or any state thereof that at the time of purchase have been rated
and the ratings for which are not less than “P 1” if rated by Moody’s,
and not less than “A 1” if rated by S&P;




      (d) Investments existing on the date hereof and listed on Schedule
10.3 hereto;




      (e) Investments in the Borrower and in Subsidiaries, either in the
form of equity Investments or Indebtedness permitted by §10.1(i) so long
as such entities remain the Borrower or Subsidiaries of the Borrower;




      (f) Investments consisting of the Guaranty, the Subordinated
Guaranties and subordinated guaranties constituting Additional
Subordinated Debt made in accordance with the definition of “Subordinated
Debt”, provided that such subordinated guarantees otherwise constitute
Indebtedness permitted by §10.1(e);




      (g) Investments consisting of promissory notes or other deferred
payment arrangements received as proceeds of, or entered into in
connection with, asset dispositions permitted by §10.5.2;



- 61 -









 






      (h) Investments consisting of loans and advances to employees for
moving, entertainment, travel and other similar expenses in the ordinary
course of business not to exceed $1,000,000 in the aggregate at any time
outstanding;




      (i) Investments by the Borrower or a Subsidiary of the Borrower in
Subsidiaries formed for the purpose of consummating Permitted
Acquisitions or acquired in connection with Permitted Acquisitions;




      (j) other Investments; provided that (i) at the time such Investment
is made, the aggregate amount of all Investments made by the Borrower or
any of its Subsidiaries under this clause (j) after the date hereof and
after giving effect to such Investment shall not exceed $175,000,000 net
of cash returns of capital received after the date hereof with respect to
any Investments made under this clause (j), (ii) no Default or Event of
Default has occurred and is continuing at the time such Investment is
made or would result on a pro forma basis therefrom after taking into
account any Loans advanced to finance such Investment, and (iii) the
Borrower delivers to the Administrative Agent a duly executed certificate
substantially in the form of Exhibit F hereto in connection with such
Investment;


provided, however, that, with the exception of Investments referred to in
§10.3(a), (b) and (c) and loans and advances referred to in §(h) and Excluded
Assets, such Investments will be considered Investments permitted by this §10.3
only if all actions have been taken to the reasonable satisfaction of the
Administrative Agent to provide to the Administrative Agent, for the benefit of
the Lenders and the Administrative Agent, a first priority perfected security
interest in all of such Investments free of all Liens other than Permitted
Liens.




     10.4. Restricted Payments. The Borrower will not, and will not permit any
of its Subsidiaries to, make any Restricted Payments; provided, however, that:




      (a) wholly-owned direct or indirect Subsidiaries of the Borrower may
make Restricted Payments to the Borrower or any wholly-owned Subsidiary
of the Borrower, and Subsidiaries which are not wholly-owned Subsidiaries
of the Borrower may make Distributions in respect of their Capital Stock
so long as the Borrower and/or any of its Subsidiaries (as applicable)
receives at least its or their pro rata share of such Distribution in
accordance with its or their proportional interests in such Subsidiaries’
Capital Stock;




      (b) so long as the payment is required by the terms thereof, and no
Default or Event of Default shall have occurred and be continuing or
would result from such payment, the Borrower may make scheduled payments
of interest on Subordinated Debt permitted by §10.1(e) or §10.1(k),
provided that the Borrower delivers to the Administrative Agent a duly
executed certificate substantially in the form of Exhibit F hereto;




      (c) the Borrower may use the proceeds of the Refinancing Notes
issued in accordance with §10.1(e) to prepay and redeem all of the
Subordinated Notes outstanding on the date of such issuance, subject to
and in accordance with §9.16;




      (d) the Borrower may (i) make cash payments to its employees
pursuant to one or more of its 401(k), profit sharing, equity incentive
or other benefit plans (including payments in respect of terminated
employees (as a result of death or otherwise) whose economic interest in
such plan does not exceed $5,000), (ii) repurchase fractional shares of
common stock issued to or for the benefit of the employees of the
Borrower or any of its Subsidiaries, and (iii) make cash payments to the
applicable taxing authorities for the benefit of its employees to the
extent of the Borrower’s withholding tax liability resulting from the
issuances of common stock to its



- 62 -









 






employees in connection with any bona fide employee stock option,
stock purchase or similar plan of the Borrower;




      (e) the Borrower may make cash Distributions to the Parent to enable
it to pay taxes attributable to the operations of the Borrower and its
Subsidiaries and Holdco Corporate Overhead Expenses;




      (f) so long as no Default or Event of Default has occurred and is
continuing or would result from such payments and the Borrower delivers
to the Administrative Agent a duly executed certificate substantially in
the form of Exhibit F hereto, the Borrower may make (w) cash
Distributions to the Parent to enable it to pay scheduled payments of
interest on the Senior Discount Notes, provided that under no
circumstances shall the Borrower make any such Distributions prior to
September 15, 2006, (x) Distributions to the Parent to enable it to pay
scheduled dividends on its preferred stock; provided that in the case of
preferred stock issued after the date hereof, contemporaneously with the
issuance of such preferred stock (other than preferred stock issued to
refinance, replace or redeem outstanding preferred stock), the Borrower
received the Net Cash Equity Issuance Proceeds from such Equity Issuance,
(y) Distributions to the Parent to satisfy the Parent’s obligations to
make payments of the type permitted under clause (e) above, and (z) cash
Distributions to the Parent to enable it to repurchase its Common Stock
or preferred stock; provided that, in the case of this clause (z), the
Total Leverage Ratio as of the last day of the fiscal quarter most
recently ended prior to the proposed date of such repurchase (calculated
on a pro forma basis after giving effect to such repurchase) does not
exceed the lesser of (i) 6.00:1.00 and (ii) 0.50 lower than the then
required Total Leverage Ratio;




      (g) the Borrower may make cash Distributions to the Parent (i) on or
about the Funding Date, upon receipt by the Borrower of net cash proceeds
from the issuance of the Refinancing Notes, subject to and in accordance
with §8.17.1 and §9.16 for the sole purpose of funding the whole or
partial redemption of the Senior Discount Notes and (ii) from time to
time after the Funding Date for the sole purpose of funding the
redemption of the balance of the Senior Discount Notes outstanding after
the application of net cash proceeds of the Refinancing Notes as set
forth in clause (g)(i) above; and




      (h) to the extent not otherwise permitted under clause (e) above,
the Borrower may pay, or make cash Distributions to the Parent to enable
the Parent to pay, consulting fees payable to the Borrower’s or the
Parent’s independent directors; provided that such fees shall be payable
in such amounts and on such terms as are no less favorable to the
Borrower or the Parent, as applicable, as would have been obtained on an
arm’s length basis in the ordinary course of business if such Person were
not a director or an Affiliate.



     10.5. Merger, Consolidation, Acquisition and Disposition of Assets.




      10.5.1. Mergers and Acquisitions. The Borrower will not, and will
not permit any of its Subsidiaries to, become a party to any merger,
amalgamation or consolidation, or agree to or effect any asset
acquisition or stock acquisition, or enter into any LMA Agreement,
except:




      (a) the merger or consolidation of one (1) or more of the Operating
Subsidiaries of the Borrower with and into the Borrower, or the merger or
consolidation of two (2) or more wholly-owned (A) Operating Subsidiaries
or (B) License Subsidiaries of the Borrower;




      (b) the acquisition (whether pursuant to an Asset Swap or otherwise)
of stock, or other securities of, or any assets of, any Person, in each
case to the extent such acquisition would involve all or substantially
all of a radio broadcasting, television broadcasting or publishing
business or business unit thereof, provided that:



- 63 -









 






        (i) no Default or Event of Default has occurred and is
continuing or would result from such acquisition;




        (ii) not less than five (5) Business Days prior to the
consummation of such proposed acquisition, the Borrower shall have
delivered to the Administrative Agent a duly executed certificate
substantially in the form of Exhibit F hereto, and upon the
Administrative Agent’s request, such financial projections as
shall be necessary, in the reasonable judgment of the
Administrative Agent, to demonstrate that, after giving effect to
such acquisition, all covenants contained herein will be satisfied
on a Pro Forma Basis and that the Borrower’s ability to satisfy
its payment obligations hereunder and under the other Loan
Documents will not be impaired in any way;




        (iii) all actions have been taken to the reasonable
satisfaction of the Administrative Agent to provide to the
Administrative Agent, for the benefit of the Lenders and the
Administrative Agent, a first priority perfected security interest
in all of the assets so acquired (excluding any Excluded Assets)
pursuant to the Security Documents, free of all Liens other than
Permitted Liens;




        (iv) in the event of a stock acquisition, the acquired Person
shall become a wholly-owned Subsidiary of the Borrower and shall
comply with the terms and conditions set forth in §9.15;




        (v) the board of directors and (if required by applicable
law) the shareholders, or the equivalent thereof, of the business
to be acquired has approved such acquisition;




        (vi) all of the Borrower’s and/or its Subsidiaries’ (as the
case may be) rights and interests in, to and under each contract
and agreement entered into by such Person in connection with such
acquisition to the extent permitted have been assigned to the
Administrative Agent as security for the irrevocable payment and
performance in full of the Obligations, pursuant to Collateral
Assignments of Contracts in form and substance reasonably
satisfactory to Administrative Agent;




        (vii) in the case of any acquisition involving domestic radio
or television assets, the FCC shall have issued orders approving
or consenting to such acquisition;




        (viii) the Borrower shall have delivered to the
Administrative Agent evidence reasonably satisfactory to the
Administrative Agent that all liens and encumbrances with respect
to the properties and assets so acquired, other than Permitted
Liens, have been discharged in full;




        (ix) the Borrower shall have delivered to the Administrative
Agent (A) evidence satisfactory to the Administrative Agent that
the Borrower or such Subsidiary has completed such acquisition in
accordance with the terms of the contracts and agreements entered
into by such Person in connection with such acquisition, and (B)
certified copies of all such documents shall have been delivered
to the Administrative Agent;




        (x) all FCC Licenses acquired in connection with such
acquisition shall be transferred immediately upon consummation of
such acquisition to a License Subsidiary;




        (xi) substantially contemporaneously with such acquisition,
the Borrower shall have delivered to the Administrative Agent an
updated Schedule 8.3(b) and an updated Schedule 8.21 to this
Credit Agreement, as applicable, after giving effect to such
acquisition.



- 64 -









 






      (c) other media-related acquisitions not included in clause (b)
above, provided that (i) so long as the Total Leverage Ratio calculated
on a Pro Forma Basis after giving effect to such acquisition is greater
than 6.00:1.00, the aggregate purchase price for all such acquisitions,
whether payable in cash or otherwise, shall not exceed $150,000,000, and
(ii) each of the conditions set forth in clause (b)(i) through (xi) above
shall have been satisfied;




      (d) the Borrower or any of its Subsidiaries may enter into LMA
Agreements provided that (i) at the time the Borrower or such Subsidiary
enters into an LMA Agreement, no Default or Event of Default has occurred
and is then continuing or could reasonably be expected to result as a
consequence of entering into such LMA Agreement, (ii) if (A) the Borrower
or any of its Subsidiaries has acquired an option to acquire a Station or
is otherwise obligated to purchase a Station in connection with such LMA
Agreement or in a related transaction or (B) such LMA Agreement is
material as determined in the reasonable judgment of the Administrative
Agent after consultation with the Borrower, then, in each case, all of
the Borrower’s and/or its Subsidiaries’ (as the case may be) rights and
interests in, to and under each such LMA Agreement shall have been
assigned to the Administrative Agent as security for the irrevocable
payment and performance in full of the Obligations, pursuant to
Collateral Assignments of Contracts in form and substance satisfactory to
Administrative Agent, (iii) if such LMA Agreement contemplates a Station
acquisition, such Station acquisition must satisfy the provisions of
clause (b) above; provided that, if such LMA Agreement grants the
Borrower or such Subsidiary an option to purchase a Station, the relevant
date for determining whether the provisions of clause (b) above have been
satisfied with respect to such acquisition shall be a date not earlier
than five (5) Business Days prior to the date on which the Borrower or
such Subsidiary proposes to exercise such option, with the intent that
this clause (iii) shall not operate to prevent the Borrower or such
Subsidiary from entering into such LMA Agreement if all of the other
conditions of this clause (d) have been satisfied, save that the
provisions of clause (b) cannot be satisfied with respect to such
optional acquisition on the date of the Borrower’s or such Subsidiary’s
entry into such LMA Agreement, (iv) if such LMA Agreement contemplates an
Asset Sale or Asset Swap, such Asset Sale or Asset Swap is otherwise
permitted pursuant to §10.5 hereof, and (v) the Borrower shall have
delivered to the Administrative Agent a duly executed certificate
substantially in the form of Exhibit F hereto; and




      (e) any Investments permitted under §10.3.




      10.5.2. Disposition of Assets. The Borrower will not, and will not
permit any of its Subsidiaries to, become a party to or agree to or
effect any disposition or swap of assets, including Capital Stock of any
Subsidiary (whether by means of a public or private offering or
otherwise), other than (i) the sale of inventory, (ii) the licensing of
intellectual property, (iii) the disposition of obsolete assets, in each
case in the ordinary course of business consistent with past practices,
(iv) the sale of receivables in connection with the business operations
of such Person relating thereto or disposition of defaulted receivables
for collection and not as a financing arrangement, and (v) Asset Sales or
Asset Swaps not described in clauses (i) through (iv) above; provided
that in the case of each such Asset Sale or Asset Swap, (1) no Default or
Event of Default has occurred and is continuing or would result on a Pro
Forma Basis from such Asset Sale or Asset Swap, (2) in the case of an
Asset Sale, either (x) at least seventy-five percent (75%) of the
consideration received by the Borrower or such Subsidiary in connection
with any such Asset Sale is in the form of cash and is received upon
consummation of such Asset Sale (provided that (A) Investments permitted
hereunder and converted to cash within thirty (30) days and (B) any
Indebtedness secured by the assets sold and assumed by the buyer shall be
treated as cash proceeds for purposes of calculating compliance with the
seventy-five percent (75%) requirement set forth in this clause (2) but
not for purposes of calculating Net Cash Sale Proceeds), or (y) such
disposition constitutes a permitted Investment pursuant to §10.3(j), (3)
each such Asset Sale or Asset Swap is consummated on an arm’s length
basis for fair consideration, (4) the Borrower applies the Net Cash Sale
Proceeds received by the Borrower or any of its Subsidiaries in
connection with such Asset Sale or Asset Swap in accordance with §4.2,
(5) contemporaneously with such Asset Sale or Asset Swap, the



- 65 -









 






Borrower shall have delivered to the Administrative Agent an updated
Schedule 8.3(b) and/or Schedule 8.21, as applicable, after giving effect
to such Asset Sale or Asset Swap, and (6) in the case of an Asset Swap,
the Borrower or such Subsidiary has complied with the provisions of
§10.5.1(b)(iii) with respect to the assets acquired in such Asset Swap.
Notwithstanding the foregoing, the Borrower or any Subsidiary shall not
be required to comply with any of the conditions described in clauses (2)
and (3) of this §10.5.2 in connection with any transfer of certain assets
used in connection with the Borrower’s Hawaiian operations into a trust
for FCC regulatory purposes or the subsequent sale or disposal by such
trust of such assets, so long as the Borrower applies the Net Cash Sale
Proceeds received by the Borrower or any of its Subsidiaries in
connection with any such Asset Sale in accordance with §4.2.



     10.6. Sale and Leaseback. 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 owned by it in order then or thereafter to lease such property 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, provided, however, the Borrower or any of its Subsidiaries may
sell equipment which constitutes Capital Assets which have been acquired by
such Person within 180 days prior to such sale and thereafter lease back such
equipment provided that (a) the net present value of liabilities under such
leaseback arrangements in aggregate with Indebtedness incurred under
Capitalized Leases and permitted under §10.1(f) shall not exceed an aggregate
amount of $75,000,000 at any one time and (b) the proceeds of such sale shall
be treated as Net Cash Sale Proceeds and applied to prepay the Obligations in
accordance with §4.2.



     10.7. Compliance with Environmental Laws. The Borrower will not, and will
not permit any of its Subsidiaries to, (a) use any of the Real Estate or any
portion thereof for the handling, processing, storage or disposal of Hazardous
Substances, (b) cause or permit to be located on any of the Real Estate any
underground tank or other underground storage receptacle for Hazardous
Substances, (c) generate any Hazardous Substances on any of the Real Estate,
(d) conduct any activity at any Real Estate or use any Real Estate in any
manner so as to cause a release (i.e. releasing, spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping, leaching,
disposing or dumping) or threatened release of Hazardous Substances on, upon or
into the Real Estate or (e) otherwise conduct any activity at any Real Estate
or use any Real Estate in any manner that in any of clauses (a) through (e)
would violate any Environmental Law or bring such Real Estate in violation of
any Environmental Law, except where failure to comply could not reasonably be
expected to result in a Material Adverse Effect.



     10.8. Subordinated Debt. The Borrower will not, and will not permit any
of its Subsidiaries to, amend, supplement or otherwise modify the terms of any
of the Subordinated Note Documents or the Refinancing Note Documents, as
applicable, or any other agreement relating to Subordinated Debt or (except as
otherwise expressly permitted under §10.4) prepay, redeem, repurchase, defease,
or issue any notice of redemption or defeasance with respect to, any of the
Subordinated Debt, provided, however, this §10.8 shall not restrict the right
of the Borrower to amend the Subordinated Notes or the Refinancing Notes, as
applicable, or any other document evidencing Subordinated Debt to extend the
maturity thereof or amend any covenants therein so as to make such covenants
less restrictive for the Borrower and its subsidiaries.



     10.9. Employee Benefit Plans. Neither the Borrower nor any ERISA
Affiliate will:




      (a) engage in any “prohibited transaction” within the meaning of
§406 of ERISA or §4975 of the Code which could result in a material
liability for the Borrower or any of its Subsidiaries; or



- 66 -









 






      (b) permit any Guaranteed Pension Plan to incur an “accumulated
funding deficiency”, as such term is defined in §302 of ERISA, whether or
not such deficiency is or may be waived; or




      (c) fail to contribute to any Guaranteed Pension Plan to an extent
which, or terminate any Guaranteed Pension Plan in a manner which, could
result in the imposition of a lien or encumbrance on the assets of the
Borrower or any of its Subsidiaries pursuant to §302(f) or §4068 of
ERISA; or




      (d) amend any Guaranteed Pension Plan in circumstances requiring the
posting of security pursuant to §307 of ERISA or §401(a)(29) of the Code;
or




      (e) permit or take any action which would result in the aggregate
benefit liabilities (with the meaning of §4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of
such Plans, disregarding for this purpose the benefit liabilities and
assets of any such Plan with assets in excess of benefit liabilities; or




      (f) permit or take any action which would contravene any Applicable
Pension Legislation in any way which could reasonably be expected to have
a Material Adverse Effect.



     10.10. Fiscal Year. The Borrower will not, and will not permit any of it
Subsidiaries to, change the date of the end of its fiscal year from that set
forth in §8.4.1.



     10.11. Transactions with Affiliates. The Borrower will not, and will not
permit any of its Subsidiaries to, engage in any transaction with any Affiliate
(other than (a) for services as employees, officers and directors, and (b) tax
sharing arrangements pursuant to tax sharing agreements between the Parent and
the Borrower in form and substance reasonably acceptable to the Administrative
Agent), including any contract, agreement or other arrangement providing for
the furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any such
Affiliate or, to the knowledge of the Borrower, any corporation, partnership,
trust or other entity in which any such Affiliate has a substantial interest or
is an officer, director, trustee or partner, on terms more favorable to such
Person than would have been obtainable on an arm’s-length basis in the ordinary
course of business.



     10.12. Certain Intercompany Matters. 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.



     10.13. Activities of the Parent. The Parent shall not engage in any trade
or business, own any assets, conduct any activity which is inconsistent with
activities which are normal and customary for a publicly held holding company
or 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, issue or incur any Indebtedness or effect any Equity Issuances,
except that the Parent may (a) hold and own the Capital Stock of 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 permitted under §10.3 hereof which are held by the Borrower or any
of its Subsidiaries, (c) incur Indebtedness in respect of the Obligations and
the Indebtedness evidenced by the Senior Discount Notes, (d) incur Indebtedness
on or after the Funding Date, provided that (i) the material terms of such
Indebtedness shall be substantially



- 67 -









 







similar or less restrictive than the terms of the Senior Discount Notes
and the maturity date of such new Indebtedness shall be at least six (6) months
after the later of (x) the Tranche B Maturity Date and (y) the maturity date of
any new Tranches established prior to the issuance of such new Indebtedness
pursuant to §15.1, in each case as reasonably determined by the Administrative
Agent (it being understood that such new Indebtedness shall not be deemed more
restrictive than the Senior Discount Notes solely because it might bear
interest at a higher rate than the rate applicable to the Senior Discount
Notes), and (ii) contemporaneously with the receipt by the Parent of cash
proceeds from the issuance of any such new Indebtedness, the Parent shall
either (I) apply the net cash proceeds received by the Parent from such
issuance (net of costs and expenses incurred in connection with such issuance
and net of any amounts applied to refinance the Senior Discount Notes) in
accordance with §4.4, or (II) make an equity contribution to the Borrower in an
amount equal to such net cash proceeds, the amount of such equity contribution
to be applied by the Borrower in accordance with §4.3, and (e) issue any
Capital Stock or other Equity-Like Instrument if issued in accordance with
§10.14(ii).



     10.14. Restrictions on Equity Issuances. None of the Parent, the Borrower
or any Subsidiary shall effect any Equity Issuance on or after the Funding
Date, except that (a) the Borrower may issue common stock to its employees in
connection with any bona fide employee stock option, stock purchase or similar
plan of the Borrower, and (b) the Parent may (i) issue Common Stock to
employees of the Borrower or any Subsidiary in connection with any bona fide
employee stock option, stock purchase or similar plan of the Parent, (ii) issue
Capital Stock and/or Equity-Like Instruments solely for the purpose of
redeeming all or any portion of its preferred stock outstanding on the Funding
Date, provided that the terms of any new Capital Stock or Equity-Like
Instrument so issued shall not be materially less favorable or more restrictive
than the terms of the preferred stock being redeemed, and (iii) issue
additional Capital Stock for any purpose not inconsistent with activities which
are normal and customary for a publicly-held holding company, provided that
contemporaneously with the receipt by the Parent of Net Cash Equity Issuance
Proceeds from the issuance of such additional Capital Stock, the Parent shall
make an equity contribution to the Borrower in an amount equal to the Net Cash
Equity Issuance Proceeds and the amount of such equity contribution shall be
applied by the Borrower in accordance with §4.3.



11. FINANCIAL COVENANTS.




     The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Lender
has any obligation to make any Loans or the Administrative Agent has any
obligation to issue, extend or renew any Letters of Credit, the Borrower will
comply with the following financial covenants as set forth below and which
shall be calculated on a Pro Forma Basis with respect to any Permitted
Acquisitions which occurred during the relevant Reference Period:



     11.1. Total Leverage Ratio. The Borrower will not permit the Total
Leverage Ratio as of the last day of each fiscal quarter of the Borrower ending
during any period described in the table set forth below to exceed the ratio
set forth opposite such period in such table:



	 	 	 
	Period (inclusive of dates)
	 	Ratio

	Funding Date - 11/29/04

	 	7.50:1.00
	11/30/04 - 2/27/06

	 	7.25:1.00
	2/28/06 - 2/27/07

	 	7.00:1.00
	2/28/07 - 2/28/08

	 	6.50:1.00
	2/29/08 - 2/27/09

	 	6.25:1.00
	2/28/09 - 2/27/10

	 	6.00:1.00
	2/28/10 - 2/27/11

	 	5.75:1.00
	Thereafter

	 	5.50:1.00







- 68 -









 






     11.2. Senior Leverage Ratio. The Borrower will not permit the Senior
Leverage Ratio as of the last day of each fiscal quarter of the Borrower ending
during any period described in the table set forth below to exceed the ratio
set forth opposite such period in such table:



	 	 	 
	Period (inclusive of dates)
	 	Ratio

	Funding Date - 11/29/04

	 	5.50:1.00
	11/30/04 - 2/27/06

	 	5.25:1.00
	2/28/06 - 2/27/07

	 	5.00:1.00
	2/28/07 - 2/28/08

	 	4.50:1.00
	2/29/08 - 2/27/09

	 	4.25:1.00
	2/28/09 - 2/27/10

	 	4.00:1.00
	2/28/10 - 2/27/11

	 	3.75:1.00
	Thereafter

	 	3.50:1.00







     11.3. Interest Coverage Ratio. The Borrower will not permit the Interest
Coverage Ratio as of the last day of each fiscal quarter of the Borrower ending
during any period described in the table set forth below to be less than the
ratio set forth opposite such period in such table:



	 	 	 
	Period (inclusive of dates)
	 	Ratio

	Funding Date - 2/27/07

	 	2.25:1.00
	2/28/07 - 2/27/10

	 	2.50:1.00
	Thereafter

	 	2.75:1.00







     11.4. Fixed Charge Coverage Ratio. The Borrower will not permit the Fixed
Charge Coverage Ratio as of the last day of each fiscal quarter of the Borrower
ending during any period described in the table set forth below to be less than
the ratio set forth opposite such period in such table:



	 	 	 
	Period (inclusive of dates)
	 	Ratio

	Funding Date - 2/27/07

	 	1.25:1.00
	2/28/07 - 2/27/09

	 	1.35:1.00
	Thereafter

	 	1.50:1.00







12. CLOSING CONDITIONS.




     The obligations of the Lenders to make the initial Revolving Credit Loans
and the Tranche B Term Loan and of the Administrative Agent to issue any
initial Letters of Credit shall be subject to the satisfaction as of the date
on which such initial Loans and any such initial Letters of Credit are to be
advanced of the following conditions precedent:



     12.1. Loan Documents. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full
force and effect and shall be in form and substance satisfactory to each of the
Lenders.



     12.2. Certified Copies of Governing Documents. The Administrative Agent
shall have received from the Parent, the Borrower and each of the Subsidiaries
a copy, certified by a duly authorized officer of such Person to be true and
complete on the Funding Date, of each of its Governing Documents as in effect
on such date of certification.



- 69 -









 





     12.3. Corporate or Other Action. All corporate (or other) action
necessary for the valid execution, delivery and performance by the Parent, the
Borrower and each of the Subsidiaries of this Credit Agreement and the other
Loan Documents to which it is or is to become a party shall have been duly and
effectively taken, and evidence thereof satisfactory to the Lenders shall have
been provided to each of the Lenders.



     12.4. Officer’s Certificates.




      (a) The Administrative Agent shall have received from the Parent,
the Borrower and each of the Subsidiaries an incumbency certificate,
dated as of the Funding Date, signed by a duly authorized officer of such
Person, and giving the name and bearing a specimen signature of each
individual who shall be authorized: (i) to sign, in the name and on
behalf of each of such Person, each of the Loan Documents to which such
Person is or is to become a party; (ii) in the case of the Borrower, to
make Loan Requests and Conversion Requests and to apply for Letters of
Credit; and (iii) to give notices and to take other action on its behalf
under the Loan Documents.




      (b) The Administrative Agent shall have received from each of the
Parent and the Borrower a certificate, dated as of the Funding Date,
certifying that (i) each of the representations and warranties made by
such Person under this Credit Agreement and the other Loan Documents are
true and correct on the Funding Date as though made on such date, and
(ii) each of the conditions set forth in this §12 have been satisfied.



     12.5. Validity of Liens. The Security Documents shall be effective to
create in favor of the Administrative Agent, for the benefit of the Lenders and
the Administrative Agent, a legal, valid and enforceable first priority (except
for Permitted Liens entitled to priority under applicable law) security
interest in and Lien upon the Collateral. All filings, recordings, deliveries
of instruments and other actions necessary or desirable in the opinion of the
Administrative Agent to protect and preserve such security interests shall have
been duly effected or provided for. The Administrative Agent shall have
received evidence thereof in form and substance satisfactory to the
Administrative Agent.



     12.6. Perfection Certificates, UCC Search Results and Survey.




      (a) The Administrative Agent shall have received from each of the
Parent, the Borrower and the Subsidiaries a completed and fully executed
Perfection Certificate and shall have received the results of UCC
searches with respect to the Collateral, indicating no Liens other than
Permitted Liens and otherwise in form and substance satisfactory to the
Administrative Agent.




      (b) The Administrative Agent shall have received the most recent
survey of each Mortgaged Property, properly signed, sealed and certified,
coupled with an owner’s affidavit and indemnity acceptable to the title
company certifying no change to such property from the date of the survey
through the Funding Date (so as to allow title company to delete the
survey exception) together with such related documents as the
Administrative Agent may reasonably request.



     12.7. Title Insurance. The Administrative Agent shall have received a
Title Policy covering each Mortgaged Property (or commitments to issue such
policies, with all conditions to issuance of the Title Policy deleted by an
authorized agent of the Title Insurance Company) together with proof of payment
of all fees and premiums for such policies, from the Title Insurance Company
and in amounts reasonably satisfactory to the Administrative Agent, insuring
the interest of the Administrative Agent and each of the Lenders as mortgagee
under the Mortgages.



     12.8. Financial Statements. The Administrative Agent shall have received
copies of the consolidated financial statements of the Parent and its
subsidiaries as at February 29, 2004, prepared in



- 70 -









 







accordance with GAAP and SEC requirements, together with a certification
by the principal financial or accounting officer of the Borrower that the
information contained in such financial statements fairly represents the
financial position of the Parent and its subsidiaries on the date thereof.



     12.9. FCC Licenses; Third Party Consents.




      (a) The Borrower shall have furnished to the Administrative Agent
certified 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.




      (b) The Borrower shall have furnished to the Administrative Agent
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.




      (c) All other necessary governmental and third party consents to and
notices of the transactions contemplated by the Loan Documents shall have
been obtained and given, and evidence thereof satisfactory to the
Administrative Agent shall have been provided to the Administrative
Agent.




      (d) The Borrower shall have furnished to the Administrative Agent
evidence reasonably satisfactory to the Administrative Agent of the
Borrower’s compliance with Regulation U of the Board of Governors of the
Federal Reserve System, 12 C.F.R. Part 221.



     12.10. Certificates of Insurance. The Administrative Agent shall have
received a certificate of insurance from an independent insurance broker dated
as of the Funding Date, identifying insurers, types of insurance, insurance
limits, and policy terms, and otherwise describing the insurance obtained in
accordance with the provisions of the Security Agreement and naming the
Administrative Agent as additional insured and, on all casualty insurance, loss
payee.



     12.11. Opinions of Counsel. Each of the Lenders and the Administrative
Agent shall have received a favorable legal opinion addressed to the Lenders
and the Administrative Agent, dated as of the Funding Date, in form and
substance satisfactory to the Lenders and the Administrative Agent, from:




      (a) Paul, Weiss, Rifkind, Wharton & Garrison LLP, counsel to the
Borrower and its Subsidiaries;




      (b) counsel to the Borrower and its Subsidiaries in Indiana and
California as applicable;




      (c) FCC counsel to the Borrower and its Subsidiaries; and




      (d) counsel to the Borrower and its Subsidiaries in Hawaii regarding
Real Estate matters related to the Mortgaged Properties located in the
State of Hawaii.



     12.12. Compliance Certificate. The Administrative Agent shall have
received from the Borrower a Compliance Certificate demonstrating compliance
with the covenants set forth in §11 as of the Funding Date (provided that, for
purposes of this §12.12, the Borrower shall use Consolidated Operating Cash
Flow for the Reference Period ended February 29, 2004), together with a
certificate from the principal financial or accounting officer of the Borrower
certifying that no Default or Event of Default has occurred and is continuing
as of the Funding Date.



- 71 -









 





     12.13. Senior Debt Certificate. The Administrative Agent shall have
received from the Borrower a certificate from the principal financial or
accounting 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 Loan Documents constitute “Senior Debt” under
and as defined in the Subordinated Note Indenture, and the incurrence of such
Obligations is permitted under the Senior Discount Note Indenture and under
§4.09 of the Subordinated Note Indenture and will not cause a “Default” or
“Event of Default” under and as defined in the Senior Discount Note Indenture
and the Subordinated Note Indenture, including equivalent certifications of the
principal financial or accounting officer of the Borrower with respect to the
Refinancing Notes.



     12.14. Financial Condition. The Administrative Agent shall be reasonably
satisfied and shall have received an officer’s certificate certifying that
there has been no event or occurrence which has had a Material Adverse Effect
since the Balance Sheet Date.



     12.15. Payment of Fees; Administrative Agent Fee Letter. The Borrower
shall have paid to the Lenders or the Administrative Agent, as appropriate, the
Fees pursuant to §§6.1 and 6.2 and all fees and expenses of the Administrative
Agent’s Special Counsel and the expenses of the Administrative Agent; the
Administrative Agent Fee Letter shall have been duly executed and delivered by
the respective parties thereto, shall be in full force and effect and shall be
in form and substance satisfactory to the Administrative Agent and the
Administrative Agent shall have received a fully executed copy of such
document.



     12.16. Disbursement Instructions. The Administrative Agent shall have
received Loan Requests and disbursement instructions from the Borrower with
respect to the proceeds of the Loans to be made on the Funding Date.



     12.17. Sources and Uses of Cash. The Administrative Agent shall have
received a statement of the sources and uses of proceeds of the Loans advanced
hereunder as of the date hereof.



     12.18. Accountant’s Letter. The Administrative Agent shall have received
a copy of the letter to the Borrower’s accountants pursuant to §9.9.3.



     12.19. Payoff and Termination of Existing Credit Agreement; Refinancing of
Loans. The Administrative Agent shall have received a copy of the payoff and
termination letter duly executed by the Borrower and the other parties thereto
and in form and substance satisfactory to the Administrative Agent, indicating
the amount of the loan obligations of the Borrower under the Existing Credit
Agreement to be discharged on the Funding Date and all outstanding loans or
other obligations (other than with respect to certain letters of credit to be
cash collateralized) under the Existing Credit Agreement shall have been paid
in full and all commitments thereunder shall have been terminated on the
Funding Date and all interest accrued under such loans paid in full as of the
Funding Date.



     12.20. Minimum Acceptances. The Borrower shall have accepted the consents
and letters of transmittal of not less than ninety-five (95%) of the record
holders of (a) Subordinated Notes and (b) Senior Discount Notes, in each case,
in accordance with the Offer to Purchase and Consent Solicitation Statement of
the Parent and the Borrower dated April 14, 2004.



13. CONDITIONS TO ALL BORROWINGS.




     The obligations of the Lenders to make any Loan, and of the Administrative
Agent to issue, extend or renew any Letter of Credit, in each case whether on
or after the Funding Date, shall also be subject to the satisfaction of the
following conditions precedent:



- 72 -









 





     13.1. Representations True; No Event of Default. Each of the
representations and warranties of the Parent, the Borrower and the Subsidiaries
contained in this Credit Agreement, the other Loan Documents or in any document
or instrument delivered pursuant to or in connection with this Credit Agreement
shall be true in all material respects as of the date as of which they were
made and shall also be true in all material respects at and as of the time of
the making of such Loan or the issuance, extension or renewal of such Letter of
Credit, with the same effect as if made at and as of that time (except to the
extent of changes resulting from transactions contemplated or permitted by this
Credit Agreement and the other Loan Documents and changes occurring in the
ordinary course of business that singly or in the aggregate are not materially
adverse, and to the extent that such representations and warranties relate
expressly to an earlier date) and no Default or Event of Default shall have
occurred and be continuing or, in the case of any Letter of Credit to be issued
with a face amount in excess of $25,000,000, would have occurred as of the last
day of the last Reference Period if such Letter of Credit had been included in
Consolidated Total Funded Debt on such date.



     13.2. No Legal Impediment. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable
opinion of any Lender would make it illegal for such Lender to make such Loan
or to participate in the issuance, extension or renewal of such Letter of
Credit or in the reasonable opinion of the Administrative Agent would make it
illegal for the Administrative Agent to issue, extend or renew such Letter of
Credit.



     13.3. Proceedings and Documents. All proceedings in connection with the
transactions contemplated by this Credit Agreement, the other Loan Documents
and all other documents incident thereto shall be satisfactory in substance and
in form to the Lenders and to the Administrative Agent and the Administrative
Agent’s Special Counsel, and the Lenders, the Administrative Agent and such
counsel shall have received all information and such counterpart originals or
certified or other copies of such documents as the Administrative Agent may
reasonably request.



14. EVENTS OF DEFAULT; ACCELERATION; ETC.




     14.1. Events of Default and Acceleration. If any of the following events
(“Events of Default” or, if the giving of notice or the lapse of time or both
is required, then, prior to such notice or lapse of time, “Defaults”) shall
occur:




      (a) the Borrower shall fail to pay any principal of the Loans or any
Reimbursement Obligation when the same shall become due and payable,
whether at the stated date of maturity or any accelerated date of
maturity or at any other date fixed for payment;




      (b) the Borrower or any of its Subsidiaries shall fail to pay any
interest on the Loans, any Fees, or other sums due hereunder or under any
of the other Loan Documents, within three (3) Business Days of when the
same shall become due and payable, whether at the stated date of maturity
or any accelerated date of maturity or at any other date fixed for
payment;




      (c) the Parent or the Borrower, as applicable, shall fail to comply
with any of its covenants contained in §9.2, §9.4, §9.5 (other than
§9.5.5), §9.6(iii) through (vi), §9.9, §9.12, §9.15, §9.16, §10 or §11
after the expiration of any applicable period;




      (d) the Borrower or any of its Subsidiaries shall fail to perform
any term, covenant or agreement contained herein or in any of the other
Loan Documents (other than those specified elsewhere in this §14.1) for
thirty (30) days after written notice of such failure has been given to
the Borrower by the Administrative Agent;




      (e) any representation or warranty of the Parent, the Borrower or
any of the Subsidiaries in this Credit Agreement or any of the other Loan
Documents or in any Subordinated



- 73 -









 






Note Document, Refinancing Note Document, or in any other document
or instrument delivered pursuant to or in connection with this Credit
Agreement shall prove to have been false in any material respect upon the
date when made or deemed to have been made or repeated;




      (f) the Borrower or any of its Subsidiaries shall fail to pay at
maturity, or within any applicable period of grace, any obligation for
borrowed money or credit received or in respect of any Capitalized Leases
in each case in an amount greater than $5,000,000, or fail to observe or
perform any material term, covenant or agreement contained in any
agreement by which it is bound, evidencing or securing borrowed money or
credit received or in respect of any Capitalized Leases in each case in
an amount greater than $5,000,000 for such period of time as would permit
(assuming the giving of appropriate notice if required) the holder or
holders thereof or of any obligations issued thereunder to accelerate the
maturity thereof, or any such holder or holders shall rescind or shall
have a right to rescind the purchase of any such obligations;




      (g) the Parent, the Borrower or any of their respective Subsidiaries
shall make an assignment for the benefit of creditors, or admit in
writing its inability to pay or generally fail to pay its debts as they
mature or become due, or shall petition or apply for the appointment of a
trustee or other custodian, liquidator or receiver of the Parent, the
Borrower or any of their respective Subsidiaries or of any substantial
part of the assets of such Person or shall commence any case or other
proceeding relating to such Person under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or liquidation
or similar law of any jurisdiction, now or hereafter in effect, or shall
take any action to authorize or in furtherance of any of the foregoing,
or if any such petition or application shall be filed or any such case or
other proceeding shall be commenced against the Parent, the Borrower or
any of their respective Subsidiaries and such Person shall indicate its
approval thereof, consent thereto or acquiescence therein or such
petition or application shall not have been dismissed within sixty (60)
days following the filing thereof;




      (h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Parent, the
Borrower or any of their respective Subsidiaries bankrupt or insolvent,
or approving a petition in any such case or other proceeding, or a decree
or order for relief is entered in respect of any such Person in an
involuntary case under federal bankruptcy laws as now or hereafter
constituted;




      (i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty (30) days, whether or not consecutive, any
final judgment against the Parent, the Borrower or any of their
respective Subsidiaries that, with other outstanding final judgments,
undischarged, against the Parent or any of its Subsidiaries exceeds in
the aggregate $5,000,000;




      (j) any default shall occur with respect to all or any part of the
Subordinated Debt or the holders of all or any part of the Subordinated
Debt shall accelerate the maturity of all or any part of the Subordinated
Debt; the Subordinated Debt shall be prepaid, redeemed or repurchased in
whole or in part (other than pursuant to §10.4(c)) or an offer to prepay,
redeem or repurchase the Subordinated Debt in whole or in part shall have
been made (other than pursuant to §10.4(c)) or the subordination
provisions of such Subordinated Debt are found by any court, or asserted
by the trustee in respect of, or any holder of, Subordinated Debt in a
judicial proceeding to be, invalid or unenforceable;




      (k) any of the Loan Documents shall be cancelled, terminated,
revoked or rescinded or the Administrative Agent’s security interests,
mortgages or liens in a material portion of the Collateral shall cease to
be perfected, or shall cease to have the priority contemplated by the
Security Documents otherwise than in accordance with the terms thereof
with respect to the release of any Collateral or in each case with the
express prior written agreement, consent or



- 74 -









 






approval of the Lenders, or any action or suit at law or in equity
or other legal proceeding to cancel, revoke or rescind any of the Loan
Documents shall be commenced by or on behalf of the Parent, the Borrower
or any of the Subsidiaries party thereto or any of their respective
stockholders, or any court or any other governmental or regulatory
authority or agency of competent jurisdiction shall make a determination
that, or issue a judgment, order, decree or ruling to the effect that,
any one or more of the Loan Documents is illegal, invalid or
unenforceable in accordance with the terms thereof;




      (l) the Borrower or any ERISA Affiliate incurs any liability to the
PBGC or a Guaranteed Pension Plan pursuant to Title IV of ERISA in an
aggregate amount exceeding $5,000,000, or the Borrower or any ERISA
Affiliate is assessed withdrawal liability pursuant to Title IV of ERISA
by a Multiemployer Plan requiring aggregate annual payments exceeding
$5,000,000, or any of the following occurs with respect to a Guaranteed
Pension Plan: (i) an ERISA Reportable Event, or a failure to make a
required installment or other payment (within the meaning of §302(f)(1)
of ERISA), provided that the Administrative Agent determines in its
reasonable discretion that such event (A) could be expected to result in
liability of the Borrower or any of its Subsidiaries to the PBGC or such
Guaranteed Pension Plan in an aggregate amount exceeding $5,000,000 and
(B) is reasonably likely to constitute grounds for the termination of
such Guaranteed Pension Plan by the PBGC, for the appointment by the
appropriate United States District Court of a trustee to administer such
Guaranteed Pension Plan or for the imposition of a lien in favor of such
Guaranteed Pension Plan; or (ii) the appointment by a United States
District Court of a trustee to administer such Guaranteed Pension Plan;
or (iii) the institution by the PBGC of proceedings to terminate such
Guaranteed Pension Plan;




      (m) the Borrower or any of its Subsidiaries 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 §14.1(t),
it shall not cause an Event of Default solely by virtue of meeting the
criteria of this clause (m);




      (n) there shall occur any material damage to, or loss, theft or
destruction of, any Collateral, whether or not insured, or any strike,
lockout, labor dispute, embargo, condemnation, act of God or public
enemy, or other casualty, which in any such case causes, for more than
fifteen (15) consecutive days, the cessation or substantial curtailment
of revenue producing activities at any facility of the Borrower or any of
its Subsidiaries if such event or circumstance is not covered by business
interruption insurance and would have a Material Adverse Effect;




      (o) there shall occur the loss, suspension or revocation of, or
failure to renew, any license or permit now held or hereafter acquired by
the Borrower or any of its Subsidiaries if such loss, suspension,
revocation or failure to renew would have a Material Adverse Effect;




      (p) a Change of Control shall occur;




      (q) any default or event of default shall occur under any documents
entered into in connection with any Permitted Acquisition, which such
default or event of default could reasonably be expected to have a
Material Adverse Effect;




      (r) at any time, (i) any of the Subsidiaries or Excluded
Subsidiaries shall provide a guaranty of the Parent’s obligations under
the Senior Discount Notes, or (ii) any of the Subsidiaries shall provide
a guaranty of the Borrower’s obligations under the Subordinated Notes or
the Refinancing Notes, as applicable, or any other Subordinated Debt if
such Subsidiary is not



- 75 -









 






at such time guarantying the Obligations pursuant to the Guaranty or
if such guaranty of the Borrower’s obligations under the Subordinated
Notes, the Refinancing Notes or such other Subordinated Debt, as
applicable, is not subordinated to such Subsidiary’s Obligations under
the Guaranty;




      (s) the commencement of proceedings to suspend, revoke, terminate or
substantially and adversely modify any material FCC License or other
material license of the Borrower, any of its Subsidiaries or of any
Stations thereof if such proceeding shall continue uncontested for
forty-five (45) days;




      (t) appropriate proceedings for the renewal of any material
Necessary Authorization shall not be commenced prior to the expiration
thereof or if such Necessary Authorization is not renewed or otherwise
made available for the use of the Borrower or any of its Subsidiaries;
provided that no Event of Default shall be deemed to occur under this
clause (t) if (A) no Material Adverse Effect shall have occurred as a
result of such event and (B) the Borrower shall have demonstrated
compliance with §11 on a Pro Forma Basis (both before and after giving
effect to such event) as though the affected Station had been sold in an
Asset Sale as of the first day of the Reference Period most recently
ended and the Borrower or the applicable Subsidiary received no
consideration for such sale;




      (u) any contractual obligation which is necessary to the
broadcasting operations of the Borrower and its Subsidiaries 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 order of the FCC relating to any Permitted Acquisition
granting or consenting to a transfer of an FCC License in connection with
any Permitted Acquisition which has been completed shall not have become
final and any Governmental Authority shall have entered an order
reversing such order (whether or not such order shall be subject to
further appeal);




      (w) any “Default” or “Event of Default” under the Senior Discount
Notes shall have occurred;




      (x) the Parent shall fail to make any equity contribution to the
Borrower in the amount or at the time required pursuant to §10.13 or
§10.14;




      (y) (i) the Austin Partnership shall incur any Indebtedness in an
aggregate amount at any one time outstanding in excess of $20,000,000 or
(ii) the partnership agreement or any other governing documents relating
to the Austin Partnership 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 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; 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;




	 	 	then, and in any such event, so long as the same may be continuing, the
Administrative Agent may, and upon the request of the Required Lenders shall,
by notice in writing to the Borrower declare all amounts owing with respect to
this Credit Agreement, the Notes and the other Loan Documents and all
Reimbursement Obligations to be, and they shall thereupon forthwith become,
immediately due and




- 76 -









 






	 	 	payable without presentment, demand, protest or other notice of any kind, all
of which are hereby expressly waived by the Borrower; provided that in the
event of any Event of Default specified in §14.1(g) or §14.1(h), all such
amounts shall become immediately due and payable automatically and without any
requirement of notice from the Administrative Agent or any Lender. In
addition, the Administrative Agent may direct the Borrower by notice in writing
to pay (and the Borrower hereby agrees upon notice to pay) to the
Administrative Agent such additional amounts of cash, to be held as security
for all Reimbursement Obligations, equal to the Maximum Drawing Amount of
Letters of Credit then outstanding.





     14.2. Termination of Commitments. If any one or more of the Events of
Default specified in §14.1(g) or §14.1(h) shall occur, any unused portion of
the credit hereunder shall forthwith terminate and each of the Lenders shall be
relieved of all further obligations to make Loans to the Borrower and the
Administrative Agent shall be relieved of all further obligations to issue,
extend or renew Letters of Credit. If any other Event of Default shall have
occurred and be continuing the Administrative Agent may and, upon the request
of the Required Lenders, shall, by notice to the Borrower, terminate the unused
portion of the credit hereunder, and upon such notice being given such unused
portion of the credit hereunder shall terminate immediately and each of the
Lenders shall be relieved of all further obligations to make Loans and the
Administrative Agent shall be relieved of all further obligations to issue,
extend or renew Letters of Credit. No termination of the credit hereunder
shall relieve the Borrower or any of its Subsidiaries of any of the
Obligations.



     14.3. Remedies. Subject to §18.1, in case any one or more of the Events
of Default shall have occurred and be continuing, and whether or not the
Lenders shall have accelerated the maturity of the Loans pursuant to §14.1,
each Lender, if owed any amount with respect to the Loans or the Reimbursement
Obligations, may, with the consent of the Required Lenders but not otherwise,
proceed to protect and enforce its rights by suit in equity, action at law or
other appropriate proceeding, whether for the specific performance of any
covenant or agreement contained in this Credit Agreement and the other Loan
Documents or any instrument pursuant to which the Obligations to such Lender
are evidenced, including as permitted by applicable law the obtaining of the ex
parte appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Lender. No remedy herein conferred upon any
Lender or the Administrative Agent or the holder of any Note or purchaser of
any Letter of Credit Participation is intended to be exclusive of any other
remedy and each and every remedy shall be cumulative and shall be in addition
to every other remedy given hereunder or now or hereafter existing at law or in
equity or by statute or any other provision of law.



     14.4. Distribution of Collateral Proceeds. In the event that, following
the occurrence or during the continuance of any Default or Event of Default,
the Administrative Agent or any Lender, as the case may be, receives any monies
in connection with the enforcement of any of the Security Documents, or
otherwise with respect to the realization upon any of the Collateral, such
monies shall be distributed for application as follows:




      (a) First, to the payment of, or (as the case may be) the
reimbursement of the Administrative Agent for or in respect of all
reasonable costs, expenses, disbursements and losses which shall have
been incurred or sustained by the Administrative Agent in connection with
the collection of such monies by the Administrative Agent, for the
exercise, protection or enforcement by the Administrative Agent of all or
any of the rights, remedies, powers and privileges of the Administrative
Agent under this Credit Agreement or any of the other Loan Documents or
in respect of the Collateral or in support of any provision of adequate
indemnity to the Administrative Agent against any taxes or liens which by
law shall have, or may have, priority over the rights of the
Administrative Agent to such monies;




      (b) Second, to all other Obligations in such order or preference as
the Required Lenders may determine; provided, however, that (i)
distributions shall be made (A) pari passu



- 77 -









 






among Obligations with respect to the Administrative Agent’s Fee and
all other Obligations and (B) with respect to each type of Obligation
owing to the Lenders, such as interest, principal, fees and expenses,
among the Lenders pro rata across all Tranches and (ii) the
Administrative Agent may in its discretion make proper allowance to take
into account any Obligations not then due and payable;




      (c) Third, upon payment and satisfaction in full or other provisions
for payment in full satisfactory to the Lenders and the Administrative
Agent of all of the Obligations, to the payment of any obligations
required to be paid pursuant to §9-615 of the UCC of the State of New
York; and




      (d) Fourth, the excess, if any, shall be returned to the Borrower or
to such other Persons as are entitled thereto.



15. ADDITIONAL FINANCING.




     15.1. Commitment Amount. At any time, and from time to time, the Borrower
may solicit the Lenders and any other lending institution to provide the
Borrower with additional commitments to make Loans under this Credit Agreement
in an aggregate amount not to exceed six hundred and seventy five million
dollars ($675,000,000) subject to the limitations set forth below. Neither the
Administrative Agent nor any Lender shall have any obligation to provide the
Borrower with all or any part of such additional commitment; provided that by
execution of this Credit Agreement, the Administrative Agent and the Lenders
shall be deemed to have consented, without the need for further or subsequent
consent, (a) to such additional commitments which any other Lender or lending
institution may agree to provide for the Loans which may be advanced in respect
thereof and any resulting changes in any Commitment Percentage of any Tranche,
and (b) any amendments which may be made to the Loan Documents in order to
evidence and document such commitments and Loans to the extent that any such
amendment (i) does not amend any of the provisions specified in §18.12(a) as
requiring the consent of each Lender affected thereby, (ii) does not modify the
relative priority of the Loans (including any such new Loans) and commitments
(including any such new commitments) with respect to the payment, guarantees,
collateral or other collateral support, and (iii) is consistent with all other
requirements of this §15. The Borrower may elect to allocate all or any
portion of such additional commitment among the existing Tranches or may
allocate all or a portion of such additional commitment to one or more new
Tranches; provided that (x) the Total Revolving Credit Commitment may not be
increased by more than three hundred and fifty million dollars ($350,000,000)
as a result of such allocations, (y) any additional Revolving Credit Loans and
Revolving Credit Commitments shall mature or terminate, as the case may be, on
or after the Revolving Credit Loan Maturity Date and (z) any amounts not
allocated to increase the Total Revolving Credit Commitment shall be advanced
in the form of term loans under a bank term tranche or fund term tranche and
any such additional term loans shall either (A) with respect to any additional
term loans structured as a bank term tranche, amortize on the same or slower
schedule as the Tranche B Term Loan as in effect at such time until the Tranche
B Maturity Date and shall have a final maturity date on or after the Tranche B
Maturity Date, and (B) with respect to any additional term loans structured as
a fund term tranche, amortize either on the same schedule as the Tranche B Term
Loan or have a weighted average term to maturity which is longer than the
Tranche B Term Loan. Moreover, if the interest rate in respect of any
additional Revolving Credit Loans, or the commitment fees payable in respect of
any additional Revolving Credit Commitments, made available pursuant to this
§15 exceeds the interest rate or the Commitment Fee payable in respect of the
Revolving Credit Loans and the Revolving Credit Commitments as provided in §2.5
and §2.2, respectively, then the interest rate calculated in accordance with
§2.5 or such Commitment Fee (as applicable) shall automatically be increased to
the interest rate or the commitment fee, as the case may be, payable in respect
of the additional Revolving Credit Loans and Revolving Credit Commitments made
available pursuant to this §15 without the requirement of any further action or
consent on the part of the Administrative Agent, any Lender or the Borrower.
In addition, if the interest rate payable in respect of any additional term
loans made available pursuant to this §15 at any time exceeds the interest rate
payable in respect of the Tranche B Term Loan as provided in §3.5 plus 0.25%,
then the interest rate payable in respect of the Tranche B Term



- 78 -









 







Loan shall automatically be increased to a rate that is at all times equal
to the rate payable with respect to such additional term loans less 0.25%
without the requirement of any further action or consent on the part of the
Administrative Agent, any Lender or the Borrower. Notwithstanding anything to
the contrary set forth herein, no additional commitments shall be permitted
hereunder and no additional loans may be advanced in respect thereof unless (1)
no Default or Event of Default shall have occurred and be then continuing or
would result after giving effect to such additional commitments and the loans
to be advanced in respect thereof, assuming that such loans were fully advanced
on the effective date of such additional commitments, (2) the Borrower shall
have delivered to the Administrative Agent a Compliance Certificate
demonstrating compliance with the terms of the Credit Agreement after giving
pro forma effect to such loans to be advanced in respect of the additional
commitment and the application of the proceeds thereof, such compliance to be
calculated based on the Borrower’s Consolidated Operating Cash Flow reported in
connection with the preparation of the Borrower’s Compliance Certificate most
recently delivered to the Administrative Agent, (3) with respect to each
lending institution not yet a party hereto providing additional commitments,
such lending institution shall have become a party to this Credit Agreement
(and become subject to all the rights and obligations of a Lender hereunder) by
executing the delivering to the Administrative Agent an original, executed
Instrument of Accession in the form of Exhibit G hereto (an “Instrument of
Accession”), (4) the Borrower shall have delivered to the Administrative Agent
and the Lenders notice that such solicitation has been made and, prior to the
effectiveness of such additional commitment, copies of all documents and
instruments related thereto, (5) the Borrower shall have delivered to the
Administrative Agent copies of updated financial projections through the final
maturity date of any additional commitments provided hereunder and (6) the
additional commitments and additional loans pursuant to this §15.1 (A) are
permitted indebtedness under the Subordinated Note Documents or the Refinancing
Note Documents, as applicable, (B) constitute for purposes of the Subordinated
Note Indenture or the Refinancing Note Indenture, as applicable, “Senior Debt”
to the same degree as the Obligations in existence prior to the making of such
additional loans or such additional commitments, and (C) any Revolving Credit
Loans made hereunder shall constitute permitted indebtedness under each of the
Subordinated Note Indenture, the Senior Discount Note Indenture and the
Refinancing Note Indenture, as applicable, without requiring the Borrower to
demonstrate compliance with any leverage ratio incurrence covenants contained
in the Subordinated Note Indenture, the Senior Discount Note Indenture and the
Refinancing Note Indenture, as applicable. Neither the Administrative Agent
nor any Lender shall have any obligation to provide the Borrower with any such
additional commitments.



     15.2. Evidence of Debt. The Loans made pursuant to this §15 shall be
evidenced by one or more accounts or records maintained by the applicable
Lender and by the Administrative Agent in the ordinary course of business. The
accounts or records maintained by the Administrative Agent and each such Lender
shall be conclusive absent manifest error of the amount of the Loans made
pursuant to this §15 by the applicable Lenders to the Borrower and the interest
and payments thereon. Any failure to so record or any error in doing so shall
not, however, limit or otherwise affect the obligation of the Borrower
hereunder to pay any amount owing with respect to the Obligations. In the
event of any conflict between the accounts and records maintained by any
applicable Lender and the accounts and records of the Administrative Agent in
respect of such matters, the accounts and records of the Administrative Agent
shall control in the absence of manifest error. In addition to such accounts
or records, upon request of any applicable Lender, the Borrower shall execute
and deliver to such Lender , in the case of any new Tranche, a new Note for
such Tranche and, in the case of an increase to an existing Tranche, an amended
Note as applicable for the corresponding Tranche in the form of the appropriate
Note then held by such Lender (the “Current Note”), in a principal amount equal
to such Lender’s Commitment Percentage of the applicable Tranche as increased
pursuant to this §15 or, if less, the outstanding amount of all Loans made by
such Person in respect of such Tranche, plus interest accrued thereon at the
applicable rate. Within five (5) days of the receipt of the amended Note, such
Lender shall deliver to the Borrower the Current Note marked “substituted.”



16. THE ADMINISTRATIVE AGENT.




- 79 -









 








     16.1. Appointment and Authority. Each Lender hereby irrevocably appoints
Bank of America to act on its behalf as the Administrative Agent hereunder and
under the other Loan Documents and authorizes the Administrative Agent to take
such actions on its behalf and to exercise such powers delegated to the
Administrative Agent by the terms hereof or thereof, together with such actions
and powers as are reasonably incidental thereto. The provisions of this §16
are solely for the benefit of the Administrative Agent and the Lenders and
neither the Parent nor the Borrower shall have rights as a third party
beneficiary of any such provisions.



     16.2. Rights as a Lender. The Person serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the
Person serving as the Administrative Agent hereunder in its individual
capacity. Such Person and its Affiliates may accept deposits from, lend money
to, act as the financial advisor or in any other advisory capacity for and
generally engage in any kind of business with the Parent, the Borrower or any
Subsidiary or other Affiliate thereof as if such Person were not the
Administrative Agent hereunder and without any duty to account therefor to the
Lenders.



     16.3. Exculpatory Provisions. The Administrative Agent shall not have any
duties or obligations except those expressly set forth herein and in the other
Loan Documents. Without limiting the generality of the foregoing, the
Administrative Agent:




      (a) shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;




      (b) shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated hereby or by the other Loan Documents that the
Administrative Agent is required to exercise as directed in writing by
the Required Lenders (or such other number or percentage of the Lenders
as shall be expressly provided for herein or in the other Loan
Documents), provided that the Administrative Agent shall not be required
to take any action that, in its opinion or the opinion of its counsel,
may expose the Administrative Agent to liability or that is contrary to
any Loan Document or applicable law; and




      (c) shall not, except as expressly set forth herein and in the other
Loan Documents, have any duty to disclose, and shall not be liable for
the failure to disclose, any information relating to the Parent, the
Borrower or the Subsidiaries or any of their respective Affiliates that
is communicated to or obtained by the Person serving as the
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 (i) with the consent or at the request of the Required Lenders (or
such other number or percentage of the Lenders as shall be necessary, or as the
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in §18.2 and §14.3) or (ii) 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 notice describing
such Default is given to the Administrative Agent by the Parent, the Borrower
or a Lender.



     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 this Credit Agreement or any other Loan Document, (ii)
the contents of any certificate, report or other document delivered hereunder
or thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein or the occurrence of any



- 80 -









 







Default, (iv) the validity, enforceability, effectiveness or genuineness
of this Credit Agreement, any other Loan Document or any other agreement,
instrument or document or (v) the satisfaction of any condition set forth in
§12 and §13 or elsewhere herein, other than to confirm receipt of items
expressly required to be delivered to the Administrative Agent.



     16.4. Reliance by Administrative Agent.




      16.4.1. General. 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 (including any electronic message, Internet or intranet website
posting or other distribution) believed by it to be genuine and to have
been signed, sent or otherwise authenticated 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 have been made by the proper
Person, and shall not incur any liability for relying thereon. In
determining compliance with any condition hereunder to the making of a
Loan, or the issuance of a Letter of Credit, that by its terms must be
fulfilled to the satisfaction of a Lender, the Administrative Agent may
presume that such condition is satisfactory to such Lender unless the
Administrative Agent shall have received notice to the contrary from such
Lender prior to the making of such Loan or the issuance of such Letter of
Credit. The Administrative Agent may consult with legal counsel (who may
be counsel for the Parent, the Borrower or its Subsidiaries), 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.




      16.4.2. Non-Reliance on Administrative Agent and Other Lenders.
Each Lender acknowledges that it has, independently and without reliance
upon the Administrative Agent or any other Lender or any of their Related
Parties and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Credit Agreement. Each Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any
other Lender or any of their Related Parties 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 Credit Agreement, any other Loan Document or any related
agreement or any document furnished hereunder or thereunder.




      16.4.3. Delegation of Duties. The Administrative Agent may perform
any and all of its duties and exercise its rights and powers hereunder or
under any other Loan Document 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 of its duties and exercise its
rights and powers by or through their respective Related Parties. The
exculpatory provisions of this §16 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.



     16.5. Payments.




      16.5.1. Payments to Administrative Agent. A payment by the Parent
or the Borrower to the Administrative Agent hereunder or any of the other
Loan Documents for the account of any Lender shall constitute a payment
to such Lender. The Administrative Agent agrees promptly to distribute
to each Lender such Lender’s pro rata share of payments received by the
Administrative Agent for the account of the Lenders except as otherwise
expressly provided herein or in any of the other Loan Documents.



- 81 -









 






      16.5.2. Distribution by Administrative Agent. If in the opinion of
the Administrative Agent the distribution of any amount received by it in
such capacity hereunder, under the Notes or under any of the other Loan
Documents might involve it in liability, it may refrain from making such
distribution until its right to make such distribution shall have been
adjudicated by a court of competent jurisdiction. If a court of
competent jurisdiction shall adjudge that any amount received and
distributed by the Administrative Agent is to be repaid, each Person to
whom any such distribution shall have been made shall either repay to the
Administrative Agent its proportionate share of the amount so adjudged to
be repaid or shall pay over the same in such manner and to such Persons
as shall be determined by such court.




      16.5.3. Delinquent Lenders. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other Loan
Documents, any Lender that fails (a) to make available to the
Administrative Agent its pro rata share of any Loan or to purchase any
Letter of Credit Participation or (b) to comply with the provisions of
§16.1 with respect to making dispositions and arrangements with the other
Lenders, where such Lender’s share of any payment received, whether by
setoff or otherwise, is in excess of its pro rata share of such payments
due and payable to all of the Lenders, in each case as, when and to the
full extent required by the provisions of this Credit Agreement, shall be
deemed delinquent (a “Delinquent Lender”) and shall be deemed a
Delinquent Lender until such time as such delinquency is satisfied. The
Administrative Agent may, in its discretion, apply any and all payments
otherwise due to a Delinquent Lender from the Borrower, whether on
account of outstanding Loans, Unpaid Reimbursement Obligations, interest,
fees or otherwise, to the remaining nondelinquent Lenders for application
to, and reduction of, their respective pro rata shares of all outstanding
Loans and Unpaid Reimbursement Obligations. The Delinquent Lender hereby
authorizes the Administrative Agent to distribute and apply such payments
to the nondelinquent Lenders in proportion to their respective pro rata
            shares of all outstanding Loans and Unpaid Reimbursement Obligations. A
Delinquent Lender shall be deemed to have satisfied in full a delinquency
when and if, as a result of application of the assigned payments to all
outstanding Loans and Unpaid Reimbursement Obligations of the
nondelinquent Lenders, the Lenders’ respective pro rata shares of all
outstanding Loans and Unpaid Reimbursement Obligations have returned to
those in effect immediately prior to such delinquency and without giving
effect to the nonpayment causing such delinquency.



     16.6. Reimbursement by Lenders. To the extent that the Borrower for any
reason fails to indefeasibly pay any amount required under §18.2 or §18.3 to be
paid by it to the Administrative Agent (or any sub-agent thereof) or any
Related Party of any of the foregoing, each Lender severally agrees to pay to
the Administrative Agent (or any such sub-agent) or such Related Party, as the
case may be, such Lender’s Total 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 (or any such sub-agent) in its
capacity as such, or against any Related Party acting for the Administrative
Agent (or any such sub-agent) in connection with such capacity. The
obligations of the Lenders under this §16.6 are several and the failure or
refusal of any Lender to reimburse the Administrative Agent for its portion of
such unpaid amount shall not relieve any other Lender from its several
obligation hereunder. The undertaking in this §16.6 shall survive termination
of the Total Commitment, the payment of all other Obligations and the
resignation of the Administrative Agent.



     16.7. Resignation of Administrative Agent. The Administrative Agent may
at any time give notice of its resignation to the Lenders and the Borrower.
Upon receipt of any such notice of resignation, the Required Lenders shall have
the right, in consultation with the Borrower, to appoint a successor, which
shall be a bank with an office in the United States, or an Affiliate of any
such bank with an office in the United States. If no such 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, appoint a successor



- 82 -









 







Administrative Agent meeting the qualifications set forth above. Upon the
acceptance of a successor’s appointment as Administrative Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring Administrative Agent and the term
“Administrative Agent” shall mean such successor administrative agent and the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Loan Documents. The Borrower agrees
to pay the fees of the successor Administrative Agent as may be agreed between
the Borrower and such successor Administrative Agent. After any retiring
Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this §16 and §§18.2 and 18.3 shall continue in
effect for the benefit of the 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 the retiring Administrative Agent was acting as
Administrative Agent.


Any resignation by Bank of America as Administrative Agent pursuant to this §16
shall also constitute its resignation as issuer of Letters of Credit. Upon the
acceptance of a successor’s appointment as Administrative Agent hereunder, (a)
such successor shall succeed to and become vested with all of the rights,
powers, privileges and duties of the retiring issuer of Letters of Credit, (b)
the retiring issuer of Letters of Credit shall be discharged from all of its
respective duties and obligations hereunder or under the other Loan Documents,
and (c) the successor issuer of Letters of Credit shall issue letters of credit
in substitution for the Letters of Credit, if any, outstanding at the time of
such succession or make other arrangement satisfactory to the retiring issuer
of Letters of Credit to effectively assume the obligations of the retiring
issuer of Letters of Credit with respect to such Letters of Credit.




     16.8. Administrative Agent May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Parent, the Borrower or any Subsidiary, the
Administrative Agent (irrespective of whether the principal of any Loan or
Reimbursement Obligation shall then be due and payable as herein expressed or
by declaration or otherwise and irrespective of whether the Administrative
Agent shall have made any demand on the Borrower or any other Person primarily
or secondarily liable) shall be entitled and empowered, by intervention in such
proceeding or otherwise




      (a) to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Loans, Reimbursement
Obligations and all other Obligations that are owing and unpaid and to
file such other documents as may be necessary or advisable in order to
have the claims of the Lenders and the Administrative Agent (including
any claim for the reasonable compensation, expenses, disbursements and
advances of the Lenders and the Administrative Agent and their respective
agents and counsel and all other amounts due the Lenders and the
Administrative Agent under §5.6, §6 and §18.2) allowed in such judicial
proceeding; and




      (b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;


and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under §6 and §18.2.



Nothing contained herein shall be deemed to authorize the Administrative Agent
to authorize or consent to or accept or adopt on behalf of any Lender any plan
of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize the Administrative
Agent to vote in respect of the claim of any Lender in any such proceeding.


- 83 -









 








     16.9. No Other Duties, Etc. Anything herein to the contrary
notwithstanding, none of the book managers, arrangers listed on the cover page
hereof shall have any powers, duties or responsibilities under this Credit
Agreement or any of the other Loan Documents, except in its capacity, as
applicable, as the Administrative Agent or a Lender hereunder.



17. ASSIGNMENT AND PARTICIPATION.




     17.1. Successors and Assigns; Conditions to Assignment.




      (a) The provisions of this Credit Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that the Borrower may not
assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender and no Lender may assign
or otherwise transfer any of its rights or obligations hereunder except
(i) to an Eligible Assignee in accordance with the provisions of clause
(b) of this §17.1, (ii) by way of participation in accordance with the
provisions of §17.3, or (iii) by way of pledge or assignment of a
security interest subject to the restrictions of §17.5 (and any other
attempted assignment or transfer by any party hereto shall be null and
void). Nothing in this Credit Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants to the
extent provided in §17.3 and, to the extent expressly contemplated
hereby, an Indemnified Person) any legal or equitable right, remedy or
claim under or by reason of this Credit Agreement.




      (b) Any Lender may at any time assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this
Credit Agreement (including all or a portion of its Commitment and the
Loans (including for purposes of this clause (b), participations in
Reimbursement Obligations) at the time owing to it); provided that (i)
except in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment and the Loans at the time owing to it or in
the case of an assignment to a Lender or an Affiliate of a Lender or an
Approved Fund with respect to a Lender, the aggregate amount of the
Commitment (which for this purpose includes Loans outstanding thereunder)
subject to each such assignment, determined as of the date the Assignment
and Acceptance (as defined below) with respect to such assignment is
delivered to the Administrative Agent or, if “Effective Date” is
specified in the Assignment and Acceptance, as of the Effective Date,
shall not be less than $2,000,000, in respect of assignments of Revolving
Credit Commitments and/or Revolving Credit Loans and $1,000,000, in
respect of assignments of Tranche B Loans or loans made in connection
with any new Tranche structured as a term tranche pursuant to §15.1
unless, in each case, each of the Administrative Agent and the Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed); (ii) each partial assignment shall be made as an assignment of
a proportionate part of all the assigning Lender’s rights and obligations
under this Credit Agreement with respect to the Loans or the Commitment
assigned; (iii) any assignment of a Commitment must be approved by the
Administrative Agent unless the Person that is the proposed assignee is
itself a Lender (whether or not the proposed assignee would otherwise
qualify as an Eligible Assignee); and (iv) the parties to each assignment
shall execute and deliver to the Administrative Agent an Assignment and
Acceptance substantially in the form of Exhibit H hereto (an “Assignment
and Acceptance”), together with a processing and recordation fee of
$3,500 and the Eligible Assignee, if not a Lender, shall deliver to the
Administrative Agent an administrative questionnaire in the form supplied
by the Administrative Agent. Subject to acceptance and recording thereof
by the Administrative Agent pursuant to §17.2, from and after the
effective date specified in each Assignment and Acceptance, the Eligible
Assignee thereunder shall be a party to this Credit Agreement and, to the
extent of the interest assigned by such Assignment and Acceptance, have
the rights and obligations of a Lender under this Credit Agreement, and
the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Acceptance, be released from its
obligations under this Credit Agreement (and, in the case of an
Assignment and



- 84 -









 






Acceptance covering all of the assigning Lender’s rights and
obligations under this Credit Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of §§6.3,
6.7, 6.8, 6.10, 18.2 and 18.3 with respect to facts and circumstances
occurring prior to the effective date of such assignment). Upon request,
the Borrower (at its expense) shall execute and deliver a Note(s) to the
assignee Lender. Any assignment or transfer by a Lender of rights or
obligations under this Credit Agreement that does not comply with this
clause (b) shall be treated for purposes of this Credit Agreement as a
sale by such Lender of a participation in such rights and obligations in
accordance with §17.3.



     17.2. Register. The Administrative Agent, acting solely for this purpose
as an agent of the Borrower, shall maintain at the Administrative Agent’s
Office a copy of each Assignment and Acceptance delivered to it and a register
for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amounts of the Loans and Reimbursement
Obligations 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 and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Credit Agreement, notwithstanding notice to
the contrary. The Register shall be available for inspection by the Borrower
at any reasonable time and from time to time upon reasonable prior notice. In
addition, at any time that a request for a consent for a material or other
substantive change to the Loan Documents is pending, any Lender wishing to
consult with other Lenders in connection therewith may request and receive from
the Administrative Agent a copy of the Register.



     17.3. Participations.




      (a) Any Lender may at any time, without the consent of, or notice
to, the Borrower or the Administrative Agent, sell participations to any
Person (other than a natural person or the Borrower or any of the
Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or
a portion of such Lender’s rights and/or obligations under this Credit
Agreement (including all or a portion of its Commitment and/or the Loans
(including such Lender’s Letter of Credit Participations) owing to it);
provided that (i) such Lender’s obligations under this Credit 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 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 Credit 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 Credit Agreement and to approve any amendment,
modification or waiver of any provision of this Credit Agreement;
provided that such agreement or instrument may provide that such Lender
will not, without the consent of the Participant, agree to any amendment,
waiver or other modification described in clauses (a) and (b) of §18.12
that directly affects such Participant. Subject to clause (b) of this
§17.3, the Borrower agrees that each Participant shall be entitled to the
benefits of §§6.3, 6.7, 6.8 and 6.10 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to §17.1. To
the extent permitted by law, each Participant also shall be entitled to
the benefits of §18.1 as though it were a Lender, provided such
Participant agrees to be subject to §18.1 as though it were a Lender.




      (b) A Participant shall not be entitled to receive any greater
payment under §6.3 §6.7, or §6.8 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is
made with the Borrower’s prior written consent. A Participant that would
be a Non-U.S. Lender if it were a Lender shall not be entitled to the
benefits of §6.3 unless the Borrower is notified of the participation
sold to such Participant and such Participant agrees, for the benefit of
the Borrower, to comply with §6.3.3 as though it were a Lender.



- 85 -









 





     17.4. Assignee or Participant Affiliated with the Borrower. If any
Eligible Assignee is an Affiliate of the Parent, the Borrower or any of the
Subsidiaries, then any such assignee Lender shall have no right to (a) attend
meetings of the Lenders or (b) vote as a Lender hereunder or under any of the
other Loan Documents for purposes of granting consents or waivers or for
purposes of agreeing to amendments or other modifications to any of the Loan
Documents or for purposes of making requests to the Administrative Agent
pursuant to §14.1 or §14.2, and the determination of the Required Lenders shall
for all purposes of this Credit Agreement and the other Loan Documents be made
without regard to such Eligible Assignee’s interest in any of the Loans or
Reimbursement Obligations. If any Lender sells a participating interest in any
of the Loans or Reimbursement Obligations to the Parent, the Borrower or an
Affiliate of the Parent or the Borrower, then such transferor Lender shall
promptly notify the Administrative Agent of the sale of such participation and
such transferor Lender shall have no right to vote as a Lender hereunder or
under any of the other Loan Documents for purposes of granting consents or
waivers or for purposes of agreeing to amendments or modifications to any of
the Loan Documents or for purposes of making requests to the Administrative
Agent pursuant to §14.1 or §14.2 to the extent that such participation is
beneficially owned by the Parent, the Borrower or any Affiliate of the Parent
or the Borrower, and the determination of the Required Lenders shall for all
purposes of this Credit Agreement and the other Loan Documents be made without
regard to the interest of such transferor Lender in the Loans or Reimbursement
Obligations to the extent of such participation.



     17.5. Miscellaneous Assignment Provisions. Any Lender may at any time
pledge or assign a security interest in all or any portion of its rights under
this Credit Agreement to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.



- 86 -









 





18. PROVISIONS OF GENERAL APPLICATIONS.




     18.1. Setoff. The Borrower hereby grants to the Administrative Agent and
each of the Lenders a continuing lien, security interest and right of setoff as
security for all liabilities and obligations to the Administrative Agent and
each Lender, whether now existing or hereafter arising, upon and against all
deposits, credits, collateral and property, now or hereafter in the possession,
custody, safekeeping or control of the Administrative Agent or such Lender or
any Lender Affiliate and their successors and assigns or in transit to any of
them. Regardless of the adequacy of any collateral, if any of the Obligations
are due and payable and have not been paid, any deposits or other sums credited
by or due from any of the Lenders to the Borrower and any securities or other
property of the Borrower in the possession of such Lender may be applied to or
set off by such Lender against the payment of Obligations and any and all other
liabilities, direct, or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, of the Borrower to such Lender. ANY AND ALL
RIGHTS TO REQUIRE ANY LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO
ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS
RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE
BORROWER ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED. Each of the
Lenders agrees with each other Lender that (a) if an amount to be set off is to
be applied to Indebtedness of the Borrower to such Lender, other than
Indebtedness owed to such Lender evidenced by this Credit Agreement or any
Notes held by such Lender or constituting Reimbursement Obligations owed to
such Lender, such amount shall be applied ratably to such other Indebtedness
and to the Indebtedness evidenced by this Credit Agreement and such Notes or
such Reimbursement Obligations, and (b) if such Lender shall receive from the
Borrower, whether by voluntary payment, exercise of the right of setoff,
counterclaim, cross action, enforcement of the claim evidenced by this Credit
Agreement, the Notes (if any) held by, or constituting Reimbursement
Obligations owed to, such Lender by proceedings against the Borrower at law or
in equity or by proof thereof in bankruptcy, reorganization, liquidation,
receivership or similar proceedings, or otherwise, and shall retain and apply
to the payment of the Obligations owed to, the Note or Notes (if any) held by,
or Reimbursement Obligations owed to, such Lender any amount in excess of its
ratable portion of the payments received by all of the Lenders with respect to
the Obligations owed to, the Notes (if any) held by, and Reimbursement
Obligations owed to, all of the Lenders, such Lender will make such disposition
and arrangements with the other Lenders with respect to such excess, either by
way of distribution, pro tanto assignment of claims, subrogation or otherwise
as shall result in each Lender receiving in respect of the Obligations and
Reimbursement Obligations owed to it, its proportionate payment as contemplated
by this Credit Agreement; provided that if all or any part of such excess
payment is thereafter recovered from such Lender, such disposition and
arrangements shall be rescinded and the amount restored to the extent of such
recovery, but without interest.



     18.2. Expenses. The Borrower agrees to pay (a) the reasonable costs of
the Administrative Agent in producing and reproducing this Credit Agreement,
the other Loan Documents and the other agreements and instruments mentioned
herein, (b) any taxes (including any interest and penalties in respect
thereto), other than Excluded Taxes (as defined in §6.3.2), payable by the
Administrative Agent or any of the Lenders (other than taxes based upon the
Administrative Agent’s or any Lender’s net income or profits) on or with
respect to the transactions contemplated by this Credit Agreement (the Borrower
hereby agreeing to indemnify the Administrative Agent and each Lender with
respect thereto), (c) the reasonable fees, expenses and disbursements of the
Administrative Agent’s Special Counsel (and only one such Administrative
Agent’s Special Counsel at any one time) and any local or FCC counsel to the
Administrative Agent incurred in connection with the preparation, syndication,
administration or interpretation of the Loan Documents and other instruments
mentioned herein, each closing hereunder, any amendments, modifications,
approvals, consents or waivers hereto or hereunder, or the cancellation of any
Loan Document upon payment in full in cash of all of the Obligations or
pursuant to any terms of such Loan Document providing for such cancellation,
(d) the fees, expenses and disbursements (other than reimbursements of legal
fees and expenses) of the Administrative Agent, Syndication Agent or any of
their respective affiliates incurred by such Person or such affiliate in
connection with the preparation,



- 87 -









 







syndication, administration or interpretation of the Loan Documents and
other instruments mentioned herein, including all title insurance premiums and
surveyor, engineering, appraisal and examination charges, (e) all reasonable
out-of-pocket expenses (including without limitation reasonable attorneys’ fees
and costs, which attorneys may be employees of any Lender or the Administrative
Agent, and reasonable consulting, accounting, appraisal, investment bankruptcy
and similar professional fees and charges) incurred by any Lender or the
Administrative Agent in connection with (i) the enforcement of or preservation
of rights under any of the Loan Documents against the Parent, the Borrower or
any of the Subsidiaries or the administration thereof after the occurrence of a
Default or Event of Default and (ii) any litigation, proceeding or dispute
whether arising hereunder or otherwise, in any way related to any Lender’s or
the Administrative Agent’s relationship with the Borrower or any of its
Subsidiaries, and (f) all reasonable fees, expenses and disbursements of the
Administrative Agent incurred in connection with UCC searches, UCC filings,
intellectual property searches, intellectual property filings or mortgage
recordings. The covenants contained in this §18.2 shall survive payment or
satisfaction in full of all other obligations.



     18.3. Indemnification. The Borrower agrees to indemnify and hold harmless
each of the Administrative Agent, the Syndication Agent and the Lenders and
their respective affiliates, officers, directors, employees, agents and
advisors (each such Person an “Indemnified Person”) from and against any and
all claims, actions and suits whether groundless or otherwise, and from and
against any and all liabilities, losses, damages and expenses of every nature
and character arising out of this Credit Agreement or any of the other Loan
Documents or the transactions contemplated hereby including, without
limitation, (a) any actual or proposed use by the Borrower or any of its
Subsidiaries of the proceeds of any of the Loans or Letters of Credit, (b) the
reversal or withdrawal of any provisional credits granted by the Administrative
Agent upon the transfer of funds from lock box, bank agency, concentration
accounts or otherwise under any cash management arrangements with the Borrower
or any Subsidiary or in connection with the provisional honoring of funds
transfers, checks or other items, (c) any actual or alleged infringement of any
patent, copyright, trademark, service mark or similar right of the Borrower or
any of its Subsidiaries comprised in the Collateral, (d) the Parent, the
Borrower or any of the Subsidiaries entering into or performing this Credit
Agreement or any of the other Loan Documents or (e) with respect to the
Borrower and its Subsidiaries and their respective properties and assets, the
violation of any Environmental Law, the presence, disposal, escape, seepage,
leakage, spillage, discharge, emission, release or threatened release of any
Hazardous Substances or any action, suit, proceeding or investigation brought
or threatened with respect to any Hazardous Substances (including, but not
limited to, claims with respect to wrongful death, personal injury or damage to
property), in each case including, without limitation, the reasonable fees and
disbursements of counsel and allocated costs of internal counsel incurred in
connection with any such investigation, litigation or other proceeding (all the
foregoing, collectively, the “Indemnified Liabilities”), except to the extent
any of the foregoing Indemnified Liabilities result solely from the gross
negligence or willful misconduct of any such Indemnified Person. In
litigation, or the preparation therefor, such Indemnified Person shall be
entitled to select its own counsel and, in addition to the foregoing indemnity,
the Borrower agrees to pay promptly the reasonable fees and expenses of such
counsel. If, and to the extent that the obligations of the Borrower under this
§18.3 are unenforceable for any reason, the Borrower hereby agrees to make the
maximum contribution to the payment in satisfaction of such obligations which
is permissible under applicable law. The covenants contained in this §18.3
shall survive payment or satisfaction in full of all other Obligations.



     18.4. Treatment of Certain Confidential Information.




      18.4.1. Confidentiality. Each of the Lenders and the Agents agrees,
on behalf of itself and each of its affiliates, directors, officers,
employees and any Person which manages such Lender, to use reasonable
precautions to keep confidential, in accordance with their customary
procedures for handling confidential information of the same nature and
in accordance with safe and sound financial industry practices, any
non-public information supplied to it by the Borrower or any of its
Subsidiaries pursuant to this Credit Agreement, provided that nothing
herein shall limit the disclosure of any such information (a) after such
information shall have become public other than through a violation of
this §18, or becomes available to any of the Lenders or the



- 88 -









 






Agents on a nonconfidential basis from a source other than the
Borrower, (b) to the extent required by statute, law, rule, regulation or
judicial process, (c) to counsel or financial advisers for any of the
Lenders or Agents, (d) to bank examiners or any other regulatory or
self-regulatory authority having or reasonably claiming to have
jurisdiction over any Lender or Agent, or to auditors or accountants, (e)
to the Administrative Agent, any Lender or any Financial Affiliate, (f)
in connection with any litigation to which any one or more of the
Lenders, the Agents or any Financial Affiliate is a party, or in
connection with the enforcement of rights or remedies hereunder or under
any other Loan Document, (g) to a Lender Affiliate or a Subsidiary or
affiliate of the Administrative Agent, (h) to any actual or prospective
assignee, pledgee or participant or any actual or prospective direct or
indirect counterparty (or its advisors) to any swap or derivative
transactions relating to credit or other risks or events arising under
this Credit Agreement or any other Loan Document so long as such
assignee, participant or direct or indirect counterparty (or its
advisors), as the case may be, agrees to be bound by the provisions of
§18.4 or (i) with the consent of the Borrower. Moreover, each of the
Agents, the Lenders and any Financial Affiliate is hereby expressly
permitted by the Parent and the Borrower to refer to any of the Parent,
the Borrower and their respective Subsidiaries in connection with any
advertising, promotion or marketing undertaken by any such Agent, such
Lender or such Financial Affiliate and, for such purpose, any such Agent,
such Lender or such Financial Affiliate may utilize any trade name,
trademark, logo or other distinctive symbol associated with the Parent,
the Borrower or any of their respective Subsidiaries or any of their
businesses.




      18.4.2. Prior Notification. Unless specifically prohibited by
applicable law or court order, each of the Lenders and the Administrative
Agent shall, prior to disclosure thereof, notify the Borrower of any
request for disclosure of any such non-public information by any
governmental agency or representative thereof (other than any such
request in connection with an examination of the financial condition of
such Lender by such governmental agency) or pursuant to legal process.




      18.4.3. Other. In no event shall any Lender or Agent be obligated
or required to return any materials furnished to it or any Financial
Affiliate by the Parent, the Borrower or any of their respective
Subsidiaries. The obligations of each Lender under this §18 shall
supersede and replace the obligations of such Lender under any
confidentiality letter in respect of this financing signed and delivered
by such Lender to the Borrower prior to the date hereof and shall be
binding upon any assignee of, or purchaser of any participation in, any
interest in any of the Loans or Reimbursement Obligations from any
Lender.



     18.5. Survival of Covenants, Etc. All covenants, agreements,
representations and warranties made herein and in any of the other Loan
Documents or in any documents or other papers delivered by or on behalf of the
Borrower or any of its Subsidiaries pursuant hereto shall be deemed to have
been relied upon by the Lenders and the Administrative Agent, notwithstanding
any investigation heretofore or hereafter made by any of them, and shall
survive the making by the Lenders of any of the Loans and the issuance,
extension or renewal of any Letters of Credit, as herein contemplated, and
shall continue in full force and effect so long as any Letter of Credit or any
amount due under this Credit Agreement or the Notes or any of the other Loan
Documents remains outstanding or any Lender has any obligation to make any
Loans or the Administrative Agent has any obligation to issue, extend or renew
any Letter of Credit, and for such further time as may be otherwise expressly
specified in this Credit Agreement. All statements contained in any
certificate or other paper delivered to any Lender or the Administrative Agent
at any time by or on behalf of the Borrower or any of its Subsidiaries pursuant
hereto or in connection with the transactions contemplated hereby shall
constitute representations and warranties by the Borrower or such Subsidiary
hereunder.



     18.6. Notices. Except as otherwise expressly provided in this Credit
Agreement, all notices and other communications made or required to be given
pursuant to this Credit Agreement or any Note or any Letter of Credit
Applications shall be in writing and shall be delivered in hand, mailed by
United States



- 89 -









 







registered or certified first class mail, postage prepaid, sent by
overnight courier, or sent by telegraph, telecopy, facsimile or telex and
confirmed by delivery via courier or postal service, addressed as follows:




      (a) if to the Parent, the Borrower or any of the Subsidiaries, at
One Emmis Plaza, 40 Monument Circle, Suite 700, Indianapolis, Indiana
46204, Attention: Jeffrey H. Smulyan, Chairman, with a copy to J. Scott
Enright, Esq., Emmis Operating Company, 40 Monument Circle, Suite 700,
Indianapolis, Indiana 46204 and Eric Goodison, Esq., Paul, Weiss,
Rifkind, Wharton & Garrison LLP, 1285 Avenue of the Americas, New York,
New York 10019, or at such other address for notice as the Borrower shall
last have furnished in writing to the Person giving the notice; and




      (b) if to any Lender or the Administrative Agent, at such Lender’s
or Administrative Agent’s address set forth on Schedule 1 hereto, with a
copy to Sula R. Fiszman, Esq., Bingham McCutchen LLP, 150 Federal Street,
Boston, Massachusetts 02110, or such other address for notice as such
party shall have last furnished in writing to the Person giving the
notice.



     Any such notice or demand shall be deemed to have been duly given or made
and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile
and (ii) if sent by registered or certified first-class mail, postage prepaid,
on the third Business Day following the mailing thereof. Any notice or other
communication to be made hereunder or under any Note or any Letter of Credit
Applications, even if otherwise required to be in writing under other
provisions of this Credit Agreement, any Note or any Letter of Credit
Applications, may alternatively be made in an electronic record transmitted
electronically under such authentication and other procedures as the parties
hereto may from time to time agree in writing (but not an electronic record),
and such electronic transmission shall be effective at the time set forth in
such procedures. Unless otherwise expressly provided in such procedures, such
an electronic record shall be equivalent to a writing under the other
provisions of this Credit Agreement, any Note or any Letter of Credit
Applications, and such authentication, if made in compliance with the
procedures so agreed by the parties hereto in writing (but not an electronic
record), shall be equivalent to a signature under the other provisions of this
Credit Agreement, any Note or any Letter of Credit Applications.



     18.7. Governing Law. THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE
SPECIFICALLY PROVIDED THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS
UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL FOR ALL PURPOSES BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID STATE OF NEW YORK
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). EACH OF THE
PARENT AND THE BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF
THE STATE OF NEW YORK OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON SUCH PERSON BY MAIL AT THE ADDRESS SPECIFIED IN §18.6. EACH OF
THE PARENT AND THE BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH
SUIT IS BROUGHT IN AN INCONVENIENT COURT.



     18.8. Headings. The captions in this Credit Agreement are for convenience
of reference only and shall not define or limit the provisions hereof.



     18.9. Counterparts. This Credit Agreement and any amendment hereof may be
executed in several counterparts and by each party on a separate counterpart,
each of which when executed and delivered shall be an original, and all of
which together shall constitute one instrument. In proving this



- 90 -









 







Credit Agreement it shall not be necessary to produce or account for more
than one such counterpart signed by the party against whom enforcement is
sought. Delivery by facsimile by any of the parties hereto of an executed
counterpart hereof or of any amendment or waiver hereto shall be as effective
as an original executed counterpart hereof or of such amendment or waiver and
shall be considered a representation that an original executed counterpart
hereof or such amendment or waiver, as the case may be, will be delivered.



     18.10. Entire Agreement, Etc. The Loan Documents and any other documents
executed in connection herewith or therewith express the entire understanding
of the parties with respect to the transactions contemplated hereby. Neither
this Credit Agreement nor any term hereof may be changed, waived, discharged or
terminated, except as provided in §18.12.



     18.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES ITS RIGHT TO
A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN
CONNECTION WITH THIS CREDIT AGREEMENT, THE NOTES OR ANY OF THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE
OF SUCH RIGHTS AND OBLIGATIONS OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING ANY
COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF THE
ADMINISTRATIVE AGENT OR ANY LENDER RELATING TO THE ADMINISTRATION OF THE LOANS
OR ENFORCEMENT OF THE LOAN DOCUMENTS AND AGREES THAT IT WILL NOT SEEK TO
CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT
BE OR HAS NOT BEEN WAIVED. Except as prohibited by law, each of the Parent and
the Borrower hereby waives any right it may have to claim or recover in any
litigation referred to in the preceding sentence any special, exemplary,
punitive or consequential damages or any damages other than, or in addition to,
actual damages. Each of the Parent and the Borrower (a) certifies that no
representative, agent or attorney of any Lender or any Agent has represented,
expressly or otherwise, that such Lender or such Agent would not, in the event
of litigation, seek to enforce the foregoing waivers and (b) acknowledges that
the Agents and the Lenders have been induced to enter into this Credit
Agreement, the other Loan Documents to which it is a party by, among other
things, the waivers and certifications contained herein.



     18.12. Consents, Amendments, Waivers, Etc. Any consent or approval
required or permitted by this Credit Agreement to be given by the Lenders may
be given, and any term of this Credit Agreement, the other Loan Documents or
any other instrument related hereto or mentioned herein may be amended, and the
performance or observance by the Parent, the Borrower or any of the
Subsidiaries of any terms of this Credit Agreement, the other Loan Documents or
such other instrument or the continuance of any Default or Event of Default may
be waived (either generally or in a particular instance and either
retroactively or prospectively) with, but only with, the written consent of the
Parent, the Borrower and the written consent of the Required Lenders; provided,
however, that any amendment or waiver of any condition described in §13 shall
require the written consent of the Parent, the Borrower, the Required Revolver
Lenders and the Required Term Lenders. Notwithstanding the foregoing, no
amendment, modification or waiver shall:




      (a) without the written consent of the Parent, the Borrower and each
Lender directly affected thereby:




        (i) reduce or forgive the principal amount of any Loans or
Reimbursement Obligations, or reduce the rate of interest on the
Loans or the amount of the Commitment Fee or Letter of Credit
Fees, amend the definition of Total Leverage Ratio or any of the
components thereof or the method of calculation thereof solely for
purposes of calculating the Applicable Margin;



- 91 -









 






        (ii) (A) increase the aggregate amount of such Lender’s
Revolving Credit Commitment or Tranche B Commitment, as the case
may be, other than in accordance with §15; (B) extend the
expiration date of such Lender’s Revolving Credit Commitment or
Tranche B Commitment; or (C) change the requirement that any
scheduled payments of principal of the Loans or voluntary or
mandatory prepayments of the Loans or reductions in the Revolving
Credit Commitments be applied pro rata to all Loans outstanding
within the applicable Tranche or outstanding Revolving Credit
Commitments, as applicable; and




        (iii) postpone or extend the Revolving Credit Loan Maturity
Date or the Tranche B Maturity Date or any other regularly
scheduled dates for payments of principal of, or interest on, the
Loans or Reimbursement Obligations or any Fees or other amounts
payable to such Lender (it being understood that (A) any vote to
rescind any acceleration made pursuant to §14.1 of amounts owing
with respect to the Loans and other Obligations and (B) any
modifications of the provisions relating to amounts, timing or
application of prepayments of Loans and other Obligations shall
require only the approval of the Required Lenders); and




        (iv) amend the definition of “Interest Period” so as to
permit Eurodollar Rate Loan intervals in excess of six months
without regard to a Lender’s capacity to lend in any such greater
intervals; and




      (b) without the written consent of all of the Lenders, amend or
waive (i) this §18.12, (ii) the definition of Required Lenders, (iii) the
distribution of collateral proceeds after an Event of Default pursuant to
§14.4, (iv) other than pursuant to a transaction permitted by the terms
of this Credit Agreement, release any material portion of the Collateral,
release any material guarantor from its guaranty obligations under the
Guaranty (excluding, if the Parent, the Borrower or any Subsidiary
becomes a debtor under the federal Bankruptcy Code, the release of “cash
collateral”, as defined in Section 363(a) of the federal Bankruptcy Code
pursuant to a cash collateral stipulation with the debtor approved by the
Required Lenders), or change the seniority of any Loans or the priority
of any Loans with respect to any Collateral or guarantor; or




      (c) without the written consent of the Administrative Agent, (i)
amend or waive §16, or amend or waive the amount or time of payment of
the Administrative Agent’s Fee or any Letter of Credit Fees payable for
the Administrative Agent’s account or any other provision applicable to
the Administrative Agent or (ii) change the definition of “Required
Revolver Lenders” without the consent of the Required Revolver Lenders or
(iii) change the definition of “Required Term Lenders” without the
consent of the Required Term Lenders.



     Notwithstanding the foregoing, the parties hereto acknowledge and agree
that the Administrative Agent may, without the consent of any Lender, (x)
release liens on Excluded Assets, (y) release its liens on the Collateral
and/or any Subsidiary from its obligations under the Guaranty solely to the
extent that such Collateral and/or Subsidiary is sold or otherwise disposed of
in accordance with the terms of this Credit Agreement, including without
limitation, §10.5.2 or (z) take any and all action necessary, including,
without limitation, entering into joinder and accession agreements with
additional Subsidiaries (or RAM or the Austin Partnership, as the case may be)
and amendments to any of the Security Documents, all in furtherance of the
provisions of §9.13 and §9.15. Any termination or other modification of any
Interest Rate Agreement with a Lender as a counterparty shall not require the
consent of any other Lender hereunder.



     No waiver shall extend to or affect any obligation not expressly waived or
impair any right consequent thereon. No course of dealing or delay or omission
on the part of the Administrative Agent or any Lender in exercising any right
shall operate as a waiver thereof or otherwise be prejudicial thereto. No



- 92 -









 







notice to or demand upon the Borrower shall entitle the Borrower to other
or further notice or demand in similar or other circumstances.



     18.13. Severability. The provisions of this Credit Agreement are
severable and if any one clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof,
in such jurisdiction, and shall not in any manner affect such clause or
provision in any other jurisdiction, or any other clause or provision of this
Credit Agreement in any jurisdiction.



     18.14. USA PATRIOT Act Notice. Each Lender that is subject to the Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrower that pursuant to the requirements
of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October
26, 2001)) (the “Act”), it is required to obtain, verify and record information
that identifies the Borrower, which information includes the name and address
of the Borrower and other information that will allow such Lender or the
Administrative Agent, as applicable, to identify the Borrower in accordance
with the Act.



19. FCC APPROVAL.




     Notwithstanding anything to the contrary contained in this Credit
Agreement or in the other Loan Documents, neither the Administrative Agent nor
any Lender will take any action pursuant to this Credit Agreement or any of the
other Loan Documents, which would constitute or result in a change in control
of the Borrower or any of its Subsidiaries requiring the prior approval of the
FCC without first obtaining such prior approval of the FCC. After the
occurrence of an Event of Default, the Borrower 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 Loan Documents,
including, at the Borrower’s cost and expense, the use of the Borrower’s best
efforts to assist in obtaining such approval for any action or transaction
contemplated by this Credit Agreement or any of the other Loan 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 Loan Documents.



- 93 -









 





     IN WITNESS WHEREOF, each of the undersigned parties has caused this Credit
Agreement to be duly executed by its authorized officer as of the date first
set forth above.


	 	 	 	 	 
	 	EMMIS OPERATING COMPANY, as Borrower

 	 
	 	By:  	 	 
	 	 	Name:  	Walter Z. Berger 	 
	 	 	Title:  	Chief Financial Officer 	 
	 



	 	 	 	 	 
	 	EMMIS COMMUNICATIONS 

CORPORATION, as Parent

 	 
	 	By:  	 	 
	 	 	Name:  	Walter Z. Berger 	 
	 	 	Title:  	Chief Financial Officer 	 




 









 






	 	 	 	 	 



	 	 	 	 	 
	 	BANK OF AMERICA, N.A.,

individually and as Administrative Agent

 	 
	 	By:  	 	 
	 	 	Name:  	Derrick Bell 	 
	 	 	Title:  	Vice President 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	GOLDMAN SACHS CREDIT PARTNERS L.P.,

individually and as Syndication Agent

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	WACHOVIA BANK, N.A., individually and as Co-

Documentation Agent

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	DEUTSCHE BANK SECURITIES INC.,

as Co-Documentation Agent

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	DEUTSCHE BANK TRUST COMPANY 

AMERICAS

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	 	 



 









 






	 	 	 	 	 



	 	 	 	 	 
	 	CREDIT SUISSE FIRST BOSTON, ACTING 

THROUGH ITS CAYMAN ISLANDS BRANCH,

individually and as Co-Documentation Agent

 	 
	 	By:  	 	 
	 	 	Name: