Document:

emms-ex102_7.htm

 

Exhibit 10.2

 

GUARANTY AND SECURITY AGREEMENT

 

This GUARANTY AND SECURITY AGREEMENT (this "Agreement"), dated as of April 12, 2019, among the Persons listed on the signature pages hereof as "Grantors" and those additional entities that hereafter become parties hereto by executing the form of Joinder attached hereto as Annex 1 (each, a "Grantor" and collectively, the "Grantors"), and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association ("Wells Fargo"), in its capacity as Secured Party for itself, as Lender, and the Bank Product Providers (in such capacity, together with its successors and assigns in such capacity, "Secured Party").

W I T N E S S E T H:

WHEREAS, pursuant to that certain Credit Agreement of even date herewith (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement") by and among EMMIS COMMUNICATIONS CORPORATION, an Indiana corporation ("Parent"), EMMIS OPERATING COMPANY, an Indiana corporation ("Emmis"), the other entities from time to time party thereto as "Borrowers" (together with Emmis, collectively, "Borrowers", and each a "Borrower"), and Wells Fargo, as lender ("Lender"), Lender has agreed to make certain financial accommodations available to Borrowers from time to time pursuant to the terms and conditions thereof; and

WHEREAS, Secured Party has agreed to act as Secured Party for the benefit of itself, as Lender, and the Bank Product Providers in connection with the transactions contemplated by the Credit Agreement and this Agreement;

WHEREAS, in order to induce Lender to enter into the Credit Agreement and the other Loan Documents, to induce the Bank Product Providers to enter into the Bank Product Agreements, and to induce Lender and the Bank Product Providers to make financial accommodations to Borrower as provided for in the Credit Agreement, the other Loan Documents and the Bank Product Agreements, (a) each Grantor (other than the Borrowers) has agreed to guaranty the Guarantied Obligations, and (b) each Grantor has agreed to grant to Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, a continuing security interest in and to the Collateral in order to secure the prompt and complete payment, observance and performance of, among other things, the Secured Obligations; and

WHEREAS, each Grantor (other than the Borrowers) is an Affiliate or a Subsidiary of a Borrower and, as such, will benefit by virtue of the financial accommodations extended to Borrower by Lender.

NOW, THEREFORE, for and in consideration of the recitals made above and other good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

 

			
	
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1989.647

 

 

1.Definitions; Construction.

(a)All initially capitalized terms used herein (including in the preamble and recitals hereof) without definition shall have the meanings ascribed thereto in the Credit Agreement (including Schedule 1.1 thereto).  Any terms (whether capitalized or lower case) used in this Agreement that are defined in the Code shall be construed and defined as set forth in the Code unless otherwise defined herein or in the Credit Agreement; provided that to the extent that the Code is used to define any term used herein and if such term is defined differently in different Articles of the Code, the definition of such term contained in Article 9 of the Code shall govern.  In addition to those terms defined elsewhere in this Agreement, as used in this Agreement, the following terms shall have the following meanings:

(i)"Account" means an account (as that term is defined in Article 9 of the Code).

(ii)"Account Debtor" means an account debtor (as that term is defined in the Code).

(iii)"Activation Instruction" has the meaning specified therefor in Section 7(k).

(iv)"Agreement" has the meaning specified therefor in the preamble to this Agreement.

(v)"Austin Deposit Account" means, until the payment in full of the Term Loan Indebtedness, either (i) account number 382318977 at JPMorgan Chase Bank, N.A. , (ii) account number 4728873050 at Lender, or (iii) such other Deposit Account that has been designated as the "Austin Deposit Account", in writing, by Borrowers to Lender, in each case to the extent the applicable deposit account is used exclusively for the purpose of receiving and holding distributions from the Austin Joint Venture, which constitute collateral under the Term Loan Indebtedness Documents.

(vi)"Bank Product Obligations" has the meaning specified therefor in the Credit Agreement.

(vii)"Bank Product Provider" has the meaning specified therefor in the Credit Agreement.

(viii)"Books" means books and records (including each Grantor's Records indicating, summarizing, or evidencing such Grantor's assets (including the Collateral) or liabilities, each Grantor's Records relating to such Grantor's business operations or financial condition, and each Grantor's goods or General Intangibles related to such information).

(ix)"Borrower" and "Borrowers" have the meaning specified therefor in the recitals to this Agreement.

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(x)"Cash Dominion Period" means the period commencing upon the occurrence of a Triggering Event and continuing until the date when (a) no Event of Default shall exist and be continuing, and (b) Excess Availability is greater than the greater of (i) 20% of the Maximum Revolver Amount and (ii) $2,400,000 for 30 consecutive days.

(xi)"Cash Equivalents" has the meaning specified therefor in the Credit Agreement.

(xii)"Chattel Paper" means chattel paper (as that term is defined in the Code), and includes tangible chattel paper and electronic chattel paper.

(xiii)"Code" means the New York Uniform Commercial Code, as in effect from time to time; provided, however, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, priority, or remedies with respect to Secured Party's Lien on any Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction other than the State of New York, the term "Code" shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies.

(xiv)"Collateral" has the meaning specified therefor in Section 3.

(xv)"Collections" has the meaning specified therefor in the Credit Agreement.

(xvi)"Commodity Exchange Act" means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

(xvii)"Communications Laws" means the Communications Act of 1934, as amended, and any successor federal statute, and the rules regulations and published policies, orders and decisions of the FCC thereunder, all as the same may be in effect from time to time.

(xviii)"Control Agreement" has the meaning specified therefor in the Credit Agreement.

(xix)"Controlled Account" has the meaning specified therefor in Section 7(k).

(xx)"Controlled Account Agreements" means those certain cash management agreements, in form and substance reasonably satisfactory to Secured Party, each of which is executed and delivered by a Grantor, Secured Party, and one of the Controlled Account Banks.

(xxi)"Controlled Account Bank" has the meaning specified therefor in Section 7(k).

(xxii)"Copyrights" means any and all rights in any works of authorship, including (A) copyrights and moral rights, (B) copyright registrations and recordings thereof and all applications in connection therewith, (C) income, license fees, royalties, damages, and payments now and hereafter due or payable under and with respect thereto, including payments under all licenses entered into in connection therewith and damages and payments for past, present, or future infringements thereof, (D) the right to sue for past, present, and future infringements thereof, and (E) all of each Grantor's rights corresponding thereto throughout the world.

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(xxiii)"Credit Agreement" has the meaning specified therefor in the recitals to this Agreement.

(xxiv)"Deposit Account" means a deposit account (as that term is defined in the Code).

(xxv)"Digonex Note" means, collectively, those promissory notes dated prior to the Closing Date in an original principal amount not to exceed $11,000,000 in the aggregate issued by Digonex Technologies, Inc. in favor of Emmis.

(xxvi)"Equipment" means equipment (as that term is defined in the Code).

(xxvii)"Equity Interests" has the meaning specified therefor in the Credit Agreement.

(xxviii)"Event of Default" has the meaning specified therefor in the Credit Agreement.  

(xxix)"Excluded Swap Obligation" means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guaranty of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor's failure for any reason to constitute an "eligible contract participant" as defined in the Commodity Exchange Act and the regulations thereunder at the time the Guaranty of such Guarantor or the grant of such security interest becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guaranty or security interest is or becomes illegal.

(xxx)"FCC" means the United States Federal Communications Commission or its successor.

(xxxi)"FCC Authorizations" means, collectively, (i) WFNI FCC AM Broadcast Station License File No. BML-20070521AIV, (ii) WIBC FCC FM Broadcast Station License File No. BLH-20031121APA, (iii) WLHK FCC FM Broadcast Station License File No. BMLH-20070501AGZ, (iv) WYXB FCC FM Broadcast Station License File No. BLH-20030403AAC, (v) all other government authorizations issued or granted by the FCC to Emmis Radio License, LLC in connection with the operation of the business of the Loan Parties or any of their Subsidiaries, and (vi) all applications filed with the FCC to which Emmis Radio License, LLC is a party, in each case, together with all renewals and extensions thereof.

(xxxii)"Fixtures" means fixtures (as that term is defined in the Code).

(xxxiii)"Foreclosed Grantor" has the meaning specified therefor in Section 2(i)(iii).

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(xxxiv)"General Intangibles" means general intangibles (as that term is defined in the Code), and includes payment intangibles, software, contract rights, rights to payment, rights under Hedge Agreements (including the right to receive payment on account of the termination (voluntarily or involuntarily) of such Hedge Agreements), rights arising under common law, statutes, or regulations, choses or things in action, goodwill, Intellectual Property, Intellectual Property Licenses, purchase orders, customer lists, monies due or recoverable from pension funds, route lists, rights to payment and other rights under any royalty or licensing agreements, including Intellectual Property Licenses, infringement claims, pension plan refunds, pension plan refund claims, insurance premium rebates, tax refunds, and tax refund claims, interests in a partnership or limited liability company which do not constitute a security under Article 8 of the Code, and any other personal property other than Commercial Tort Claims, money, Accounts, Chattel Paper, Deposit Accounts, goods, Investment Property, Negotiable Collateral, and oil, gas, or other minerals before extraction.  

(xxxv)"Grantor" and "Grantors" have the respective meanings specified therefor in the preamble to this Agreement.

(xxxvi)"Guarantied Obligations" means all of the Obligations (including any Bank Product Obligations) now or hereafter existing, whether for principal, interest (including any interest that accrues after the commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding), fees (including the fees provided for in the Fee Letter), Lender Expenses (including any fees or expenses that accrue after the commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding), or otherwise, and any and all expenses (including reasonable counsel fees and expenses) incurred by Secured Party, Lender, or any Bank Product Provider (or any of them) in enforcing any rights under the any of the Loan Documents.  Without limiting the generality of the foregoing, Guarantied Obligations shall include all amounts that constitute part of the Guarantied Obligations and would be owed by Borrower to Secured Party, Lender, or any Bank Product Provider but for the fact that they are unenforceable or not allowable, including due to the existence of a bankruptcy, reorganization, other Insolvency Proceeding or similar proceeding involving Borrower or any guarantor; provided that, anything to the contrary contained in the foregoing notwithstanding, the Guarantied Obligations shall exclude any Excluded Swap Obligation.

(xxxvii)"Guarantor" means each Grantor other than the Borrowers.

(xxxviii)"Guaranty" means the guaranty set forth in Section 2 hereof.

(xxxix)"Headquarters Facility" has the meaning specified therefor in the Credit Agreement.

(xl)"Insolvency Proceeding" has the meaning specified therefor in the Credit Agreement.

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(xli)"Intellectual Property" means any and all Patents, Copyrights, Trademarks, trade secrets, know-how, inventions (whether or not patentable), algorithms, software programs (including source code and object code), processes, product designs, industrial designs, blueprints, drawings, data, customer lists, URLs and domain names, specifications, documentations, reports, catalogs, literature, and any other forms of technology or proprietary information of any kind, including all rights therein and all applications for registration or registrations thereof.

(xlii)"Intellectual Property Licenses" means, with respect to any Person (the "Specified Party"), (A) any licenses or other similar rights provided to the Specified Party in or with respect to Intellectual Property owned or controlled by any other Person, and (B) any licenses or other similar rights provided to any other Person in or with respect to Intellectual Property owned or controlled by the Specified Party, in each case, including (x) any software license agreements (other than license agreements for commercially available off-the-shelf software that is generally available to the public which have been licensed to a Grantor pursuant to end-user licenses), (y) [reserved], and (z) the right to use any of the licenses or other similar rights described in this definition in connection with the enforcement of Lender's rights under the Loan Documents.

(xliii)"Investment Property" means (A) any and all investment property (as that term is defined in the Code), and (B) any and all of the following (regardless of whether classified as investment property under the Code):  all Pledged Interests, Pledged Operating Agreements, and Pledged Partnership Agreements.

(xliv)"Joinder" means each Joinder to this Agreement executed and delivered by Secured Party and each of the other parties listed on the signature pages thereto, in substantially the form of Annex 1.

(xlv)"Lender" has the meaning specified therefor in the recitals to this Agreement.

(xlvi)"Loan Document" has the meaning specified therefor in the Credit Agreement.

(xlvii)"Negotiable Collateral" means letters of credit, letter-of-credit rights, instruments, promissory notes, drafts and documents (as each such term is defined in the Code).

(xlviii)"Obligations" has the meaning specified therefor in the Credit Agreement.

(xlix)"Parent" has the meaning specified therefor in the recitals to this Agreement.

(l)"Patents" means patents and patent applications, including (A) [reserved], (B) all continuations, divisionals, continuations-in-part, re-examinations, reissues, and renewals thereof and improvements thereon, (C) all income, royalties, damages and payments now and hereafter due or payable under and with respect thereto, including payments under all licenses entered into in connection therewith and damages and payments for past, present, or future infringements thereof, (D) the right to sue for past, present, and future infringements thereof, and (E) all of each Grantor's rights corresponding thereto throughout the world.

(li)"Permitted Disposition" has the meaning specified therefor in the Credit Agreement.

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(lii)"Permitted Investments" has the meaning specified therefor in the Credit Agreement.

(liii)"Permitted Liens" has the meaning specified therefor in the Credit Agreement.

(liv)"Person" has the meaning specified therefor in the Credit Agreement.

(lv)"Pledged Companies" means each Person listed on Schedule 5 as a "Pledged Company".

(lvi)"Pledged Interests" means, except to the extent constituting Excluded Property, all of each Grantor's right, title and interest in and to all of the Equity Interests now owned or hereafter acquired by such Grantor, regardless of class or designation, in each of the Pledged Companies, and all substitutions therefor and replacements thereof, all proceeds thereof and all rights relating thereto, also including any certificates representing such Equity Interests, the right to receive any certificates representing any of such Equity Interests, all warrants, options, share appreciation rights and other rights, contractual or otherwise, in respect thereof and the right to receive all dividends, distributions of income, profits, surplus, or other compensation by way of income or liquidating distributions, in cash or in kind, and all cash, instruments, and other property from time to time received, receivable, or otherwise distributed in respect of or in addition to, in substitution of, on account of, or in exchange for any or all of the foregoing.

(lvii)"Pledged Interests Addendum" means a Pledged Interests Addendum substantially in the form of Exhibit C.

(lviii)"Pledged Notes" has the meaning specified therefor in Section 6(m).

(lix)"Pledged Operating Agreements" means all of each Grantor's rights, powers, and remedies under the limited liability company operating agreements of each of the Pledged Companies that are limited liability companies.

(lx)"Pledged Partnership Agreements" means all of each Grantor's rights, powers, and remedies under the partnership agreements of each of the Pledged Companies that are partnerships.

(lxi)"Proceeds" has the meaning specified therefor in Section 3.

(lxii)"Qualified ECP Guarantor" means, in respect of any Swap Obligation, each Grantor that has total assets exceeding $10,000,000 at the time the relevant guaranty, keepwell, or grant of the relevant security interest becomes effective with respect to such Swap Obligation or such other person as constitutes an "eligible contract participant" under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an "eligible contract participant" at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

(lxiii)"Radio Tower Facilities" means the Real Property located at (a) 7802 E. Southport Road, Indianapolis, Indiana 46259 and (b) 9301 Burk Road, Indianapolis, Indiana 46229.

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(lxiv)"Real Property" means any estates or interests in real property now owned or hereafter acquired by any Grantor or any Restricted Subsidiary of any Grantor and the improvements thereto.

(lxv)"Record" means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form.

(lxvi)"Rescission" has the meaning specified therefor in Section 7(k).

(lxvii)"Secured Obligations" means each and all of the following:  (A) all of the present and future obligations of each of the Grantors arising from, or owing under or pursuant to, this Agreement (including the Guaranty), the Credit Agreement, or any of the other Loan Documents, (B) all Bank Product Obligations, and (C) all other Obligations of Borrower and all other Guarantied Obligations of each Guarantor (including, in the case of each of clauses (A), (B) and (C), reasonable attorneys' fees and expenses and any interest, fees, or expenses that accrue after the filing of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any Insolvency Proceeding);  provided that, anything to the contrary contained in the foregoing notwithstanding, the Secured Obligations of the Guarantors shall exclude any Excluded Swap Obligation.

(lxviii)"Secured Party" has the meaning specified therefor in the preamble to this Agreement.

(lxix)"Secured Party's Lien" has the meaning specified therefor in the Credit Agreement.

(lxx)"Securities Account" means a securities account (as that term is defined in the Code).

(lxxi)"Security Interest" has the meaning specified therefor in Section 3.

(lxxii)"Supporting Obligations" means supporting obligations (as such term is defined in the Code), and includes letters of credit and guaranties issued in support of Accounts, Chattel Paper, documents, General Intangibles, instruments or Investment Property.

(lxxiii)"Swap Obligation" means, with respect to any Grantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a "swap" within the meaning of section 1a(47) of the Commodity Exchange Act.

(lxxiv)"Trademarks" means any and all trademarks, trade names, registered trademarks, trademark applications, service marks, registered service marks and service mark applications, including (A) [reserved], (B) all renewals thereof, (C) all income, royalties, damages and payments now and hereafter due or payable under and with respect thereto, including payments under all licenses entered into in connection therewith and damages and payments for past or future infringements or dilutions thereof, (D) the right to sue for past, present and future infringements and dilutions thereof, (E) the goodwill of each Grantor's business symbolized by the foregoing or connected therewith, and (F) all of each Grantor's rights corresponding thereto throughout the world.

(lxxv)"Triggering Event" means, as of any date of determination, that (A) an Event of Default has occurred as of such date, or (B) (1) Excess Availability is less than the greater of (x) 12.5% of the Maximum Revolver Amount, and (y) $1,500,000 as of such date, and (2) the sum of the outstanding principal balance of the Revolving Loans and the Letter of Credit Usage is greater than zero.

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(lxxvi)"URL" means "uniform resource locator," an internet web address.

(lxxvii)"Whitestown Facility" has the meaning specified therefor in the Credit Agreement.

(b)Unless the context of this Agreement clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms "includes" and  "including" are not limiting, and the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or."  The words "hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement.  Section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified.  Any reference in this Agreement to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein or in the Credit Agreement).  The words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties.  Any reference herein to the satisfaction, repayment, or payment in full of the Secured Obligations or the Guarantied Obligations shall mean (i) the payment or repayment in full in immediately available funds of (A) the principal amount of, and interest accrued with respect to, all outstanding Loans, together with the payment of any premium applicable to the repayment of the Loans, (B) all Lender Expenses that have accrued regardless of whether demand has been made therefor, (C) all fees or charges that have accrued hereunder or under any other Loan Document (including the Letter of Credit Fee and the Unused Line Fee), (ii) in the case of contingent reimbursement obligations with respect to Letters of Credit, providing Letter of Credit Collateralization, (iii) in the case of obligations with respect to Bank Products (other than Hedge Obligations), providing Bank Product Collateralization, (iv) the receipt by Secured Party of cash collateral in order to secure any other contingent Secured Obligations or Guarantied Obligations for which a claim or demand for payment has been made at such time or in respect of matters or circumstances known to Secured Party or a Lender at the time that are reasonably expected to result in any loss, cost, damage or expense (including attorneys' fees and legal expenses), such cash collateral to be in such amount as Secured Party reasonably determines is appropriate to secure such contingent Secured Obligations or Guarantied Obligations, (v) the payment or repayment in full in immediately available funds of all other Secured Obligations or Guarantied Obligations (as the case may be) (including the payment of any termination amount then applicable (or which would or could become applicable as a result of the repayment of the other Obligations) under Hedge Agreements provided by Hedge Providers) other than (A) unasserted contingent indemnification obligations, (B) any Bank Product Obligations (other than Hedge Obligations) that, at such time, are allowed by the applicable Bank Product Provider to remain outstanding without being required to be repaid or cash collateralized, and (C) any Hedge Obligations that, at such time, are allowed by the applicable Hedge Provider to remain outstanding without being required to be repaid, and (vi) the termination of all of the Commitments of the Lenders.  Any reference herein to any Person shall be construed to include such Person's successors and assigns.  Any requirement of a writing contained herein shall be satisfied by the transmission of a Record.

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(c)All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference.

2.Guaranty.

(a)In recognition of the direct and indirect benefits to be received by Guarantors from the proceeds of the Revolving Loans, the issuance of the Letters of Credit, and the entering into of the Bank Product Agreements and by virtue of the financial accommodations to be made to Borrower, each of the Guarantors, jointly and severally, hereby unconditionally and irrevocably guarantees as a primary obligor and not merely as a surety the full and prompt payment when due, whether upon maturity, acceleration, or otherwise, of all of the Guarantied Obligations.  If any or all of the Obligations constituting Guarantied Obligations becomes due and payable, each of the Guarantors, unconditionally and irrevocably, and without the need for demand, protest, or any other notice or formality, promises to pay such indebtedness to Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, together with any and all expenses (including Lender Expenses) that may be incurred by Secured Party, Lender or any Bank Product Provider in demanding, enforcing, or collecting any of the Guarantied Obligations (including the enforcement of any collateral for such Guarantied Obligations or any collateral for the obligations of the Guarantors under this Guaranty).  If claim is ever made upon Secured Party, Lender or any Bank Product Provider for repayment or recovery of any amount or amounts received in payment of or on account of any or all of the Guarantied Obligations and any of Secured Party, Lender or any Bank Product Provider repays all or part of said amount by reason of (i) any judgment, decree, or order of any court or administrative body having jurisdiction over such payee or any of its property, or (ii) any settlement or compromise of any such claim effected by such payee with any such claimant (including Borrower or any Guarantor), then and in each such event, each of the Guarantors agrees that any such judgment, decree, order, settlement, or compromise shall be binding upon the Guarantors, notwithstanding any revocation (or purported revocation) of this Guaranty or other instrument evidencing any liability of any Grantor, and the Guarantors shall be and remain liable to the aforesaid payees hereunder for the amount so repaid or recovered to the same extent as if such amount had never originally been received by any such payee.

(b)Additionally, each of the Guarantors unconditionally and irrevocably guarantees the payment of any and all of the Guarantied Obligations to Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, whether or not due or payable by any Loan Party upon the occurrence of any of the events specified in Section 8.4 or 8.5 of the Credit Agreement, and irrevocably and unconditionally promises to pay such indebtedness to Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, without the requirement of demand, protest, or any other notice or other formality, in lawful money of the United States.

(c)The liability of each of the Guarantors hereunder is primary, absolute, and unconditional, and is independent of any security for or other guaranty of the Guarantied Obligations, whether executed by any other Guarantor or by any other Person, and the liability of each of the Guarantors hereunder shall not be affected or impaired by (i) any payment on, or in reduction of, any such other guaranty or undertaking, (ii) any dissolution, termination, or increase, decrease, or change in personnel by any Grantor, (iii) any payment made to Secured Party, Lender, or any Bank Product Provider on account of the Obligations which Secured Party, Lender, or such Bank Product Provider repays to any Grantor pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding (or any settlement or compromise of any claim made in such a proceeding relating to such payment), and each of the Guarantors waives any right to the deferral or modification of its obligations hereunder by reason of any such proceeding, or (iv) any action or inaction by Secured Party, Lender, or any Bank Product Provider, or (v) any invalidity, irregularity, avoidability, or unenforceability of all or any part of the Obligations or of any security therefor.

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(d)This Guaranty includes all present and future Guarantied Obligations including any under transactions continuing, compromising, extending, increasing, modifying, releasing, or renewing the Guarantied Obligations, changing the interest rate, payment terms, or other terms and conditions thereof, or creating new or additional Guarantied Obligations after prior Guarantied Obligations have been satisfied in whole or in part.  To the maximum extent permitted by law, each Guarantor hereby waives any right to revoke this Guaranty as to future Guarantied Obligations.  If such a revocation is effective notwithstanding the foregoing waiver, each Guarantor acknowledges and agrees that (i) no such revocation shall be effective until written notice thereof has been received by Secured Party, (ii) no such revocation shall apply to any Guarantied Obligations in existence on the date of receipt by Secured Party of such written notice (including any subsequent continuation, extension, or renewal thereof, or change in the interest rate, payment terms, or other terms and conditions thereof), (iii)  no such revocation shall apply to any Guarantied Obligations made or created after such date to the extent made or created pursuant to a legally binding commitment of Lender or any Bank Product Provider in existence on the date of such revocation, (iv) no payment by any Guarantor, Borrower, or from any other source, prior to the date of Secured Party's receipt of written notice of such revocation shall reduce the maximum obligation of such Guarantor hereunder, and (v) any payment by Borrower or from any source other than such Guarantor subsequent to the date of such revocation shall first be applied to that portion of the Guarantied Obligations as to which the revocation is effective and which are not, therefore, guarantied hereunder, and to the extent so applied shall not reduce the maximum obligation of such Guarantor hereunder.  This Guaranty shall be binding upon each Guarantor, its successors and assigns and inure to the benefit of and be enforceable by Secured Party (for the benefit of itself, as Lender, and the Bank Product Providers) and its successors, transferees, or assigns.

(e)The guaranty by each of the Guarantors hereunder is a guaranty of payment and not of collection.  The obligations of each of the Guarantors hereunder are independent of the obligations of any other Guarantor or Grantor or any other Person and a separate action or actions may be brought and prosecuted against one or more of the Guarantors whether or not action is brought against any other Guarantor or Grantor or any other Person and whether or not any other Guarantor or Grantor or any other Person be joined in any such action or actions.  Each of the Guarantors waives, to the fullest extent permitted by law, the benefit of any statute of limitations affecting its liability hereunder or the enforcement hereof.  Any payment by any Grantor or other circumstance which operates to toll any statute of limitations as to any Grantor shall operate to toll the statute of limitations as to each of the Guarantors.

(f)Each of the Guarantors authorizes Secured Party, Lender, and the Bank Product Providers without notice or demand, and without affecting or impairing its liability hereunder, from time to time to:

(i)change the manner, place, or terms of payment of, or change or extend the time of payment of, renew, increase, accelerate, or alter:  (A) any of the Obligations (including any increase or decrease in the principal amount thereof or the rate of interest or fees thereon); or (B) any security therefor or any liability incurred directly or indirectly in respect thereof, and this Guaranty shall apply to the Obligations as so changed, extended, renewed, or altered;

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(ii)take and hold security for the payment of the Obligations and sell, exchange, release, impair, surrender, realize upon, collect, settle, or otherwise deal with in any manner and in any order any property at any time pledged or mortgaged to secure the Obligations or any of the Guarantied Obligations (including any of the obligations of all or any of the Guarantors under this Guaranty) incurred directly or indirectly in respect thereof or hereof, or any offset on account thereof;

(iii)exercise or refrain from exercising any rights against any Grantor;

(iv)release or substitute any one or more endorsers, guarantors, any Grantor, or other obligors;

(v)settle or compromise any of the Obligations, any security therefor, or any liability (including any of those of any of the Guarantors under this Guaranty) incurred directly or indirectly in respect thereof or hereof, and may subordinate the payment of all or any part thereof to the payment of any liability (whether due or not) of any Grantor to its creditors;

(vi)apply any sums by whomever paid or however realized to any liability or liabilities of any Grantor to Secured Party, Lender, or any Bank Product Provider regardless of what liability or liabilities of such Grantor remain unpaid;

(vii)consent to or waive any breach of, or any act, omission, or default under, this Agreement, any other Loan Document, any Bank Product Agreement, or any of the instruments or agreements referred to herein or therein, or otherwise amend, modify, or supplement this Agreement, any other Loan Document, any Bank Product Agreement, or any of such other instruments or agreements; or

(viii)take any other action that could, under otherwise applicable principles of law, give rise to a legal or equitable discharge of one or more of the Guarantors from all or part of its liabilities under this Guaranty.

(g)It is not necessary for Secured Party, Lender, or any Bank Product Provider to inquire into the capacity or powers of any of the Guarantors or the officers, directors, partners or Secured Party's acting or purporting to act on their behalf, and any Obligations made or created in reliance upon the professed exercise of such powers shall be Guarantied hereunder.

(h)Each Guarantor jointly and severally guarantees that the Guarantied Obligations will be paid strictly in accordance with the terms of the Loan Documents, regardless of any law, regulation, or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of Lender or any Bank Product Provider with respect thereto.  The obligations of each Guarantor under this Guaranty are independent of the Guarantied Obligations, and a separate action or actions may be brought and prosecuted against each Guarantor to enforce such obligations, irrespective of whether any action is brought against any other Guarantor or whether any other Guarantor is joined in any such action or actions.  The liability of each Guarantor under this Guaranty shall be absolute and unconditional irrespective of, and each Guarantor hereby irrevocably waives any defense it may now or hereafter have in any way relating to, any or all of the following:

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(i)any lack of validity or enforceability of any Loan Document or any agreement or instrument relating thereto;

(ii)any change in the time, manner, or place of payment of, or in any other term of, all or any of the Guarantied Obligations, or any other amendment or waiver of or any consent to departure from any Loan Document, including any increase in the Guarantied Obligations resulting from the extension of additional credit;

(iii)any taking, exchange, release, or non-perfection of any Lien in and to any Collateral, or any taking, release, amendment, waiver of, or consent to departure from any other guaranty, for all or any of the Guarantied Obligations;

(iv)the existence of any claim, set-off, defense, or other right that any Guarantor may have at any time against any Person, including Secured Party, Lender, or any Bank Product Provider;

(v)any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of perfection, sufficiency, validity, or enforceability of the Guarantied Obligations or any security therefor;

(vi)any right or defense arising by reason of any claim or defense based upon an election of remedies by Lender or any Bank Product Provider including any defense based upon an impairment or elimination of such Guarantor's rights of subrogation, reimbursement, contribution, or indemnity of such Guarantor against any other Grantor or any guarantors or sureties;

(vii)any change, restructuring, or termination of the corporate, limited liability company, or partnership structure or existence of any Grantor; or

(viii)any other circumstance that might otherwise constitute a defense available to, or a discharge of, any Grantor or any other guarantor or surety.

(i)Waivers.

(i)Each of the Guarantors waives any right (except as shall be required by applicable statute and cannot be waived) to require Secured Party, Lender, or any Bank Product Provider to (i) proceed against any other Grantor or any other Person, (ii) proceed against or exhaust any security held from any other Grantor or any other Person, or (iii) protect, secure, perfect, or insure any security interest or Lien on any property subject thereto or exhaust any right to take any action against any other Grantor, any other Person, or any collateral, or (iv) pursue any other remedy in Lender's or any Bank Product Provider's power whatsoever.  Each of the Guarantors waives any defense based on or arising out of any defense of any Grantor or any other Person, other than payment of the Guarantied Obligations to the extent of such payment, based on or arising out of the disability of any Grantor or any other Person, or the validity, legality, or unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the liability of any Grantor other than payment of the Obligations to the extent of such payment.  Secured Party may foreclose upon any Collateral held by Secured Party by one or more judicial or nonjudicial sales or other dispositions, whether or not every aspect of any such sale is commercially reasonable or otherwise fails to comply with applicable law or may exercise any other right or remedy Secured Party, Lender, or any Bank Product Provider may have against any Grantor or any other Person, or any security, in each case, without affecting or impairing in any way the liability of any of the Guarantors hereunder except to the extent the Guarantied Obligations have been paid.

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(ii)Each of the Guarantors waives all presentments, demands for performance, protests and notices, including notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation, or incurring of new or additional Obligations or other financial accommodations.  Each of the Guarantors waives notice of any Default or Event of Default under any of the Loan Documents.  Each of the Guarantors assumes all responsibility for being and keeping itself informed of each Grantor's financial condition and assets and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope, and extent of the risks which each of the Guarantors assumes and incurs hereunder, and agrees that neither Secured Party nor Lender nor any Bank Product Provider shall have any duty to advise any of the Guarantors of information known to them regarding such circumstances or risks.

(iii)To the fullest extent permitted by applicable law, each Guarantor hereby waives:  (A) any right to assert against Lender or any Bank Product Provider, any defense (legal or equitable), set-off, counterclaim, or claim which each Guarantor may now or at any time hereafter have against Borrower or any other party liable to Lender or any Bank Product Provider; (B) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of perfection, sufficiency, validity, or enforceability of the Guarantied Obligations or any security therefor; (C) any right or defense arising by reason of any claim or defense based upon an election of remedies by Lender or any Bank Product Provider including any defense based upon an impairment or elimination of such Guarantor's rights of subrogation, reimbursement, contribution, or indemnity of such Guarantor against Borrower or other guarantors or sureties; and (D) the benefit of any statute of limitations affecting such Guarantor's liability hereunder or the enforcement thereof, and any act which shall defer or delay the operation of any statute of limitations applicable to the Guarantied Obligations shall similarly operate to defer or delay the operation of such statute of limitations applicable to such Guarantor's liability hereunder.

(iv)No Guarantor will exercise any rights that it may now or hereafter acquire against any Grantor or any other guarantor that arise from the existence, payment, performance or enforcement of such Guarantor's obligations under this Guaranty, including any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of Secured Party, Lender, or any Bank Product Provider against any Grantor or any other guarantor or any Collateral, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including the right to take or receive from any Grantor or any other guarantor, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security solely on account of such claim, remedy or right, unless and until all of the Guarantied Obligations and all other amounts payable under this Guaranty shall have been paid in full in cash and all of the Commitments have been terminated.  If any amount shall be paid to any Guarantor in violation of the immediately preceding sentence, such amount shall be held in trust for the benefit of Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, and shall forthwith be paid to Secured Party to be credited and applied to the Guarantied Obligations and all other amounts payable under this Guaranty, whether matured or unmatured, in accordance with the terms of the Credit Agreement, or to be held as Collateral for any Guarantied Obligations or other amounts payable under this Guaranty thereafter arising.  Notwithstanding anything to the contrary contained in this Guaranty, no Guarantor may exercise any rights of subrogation, contribution, indemnity, reimbursement or other similar rights against, and may not proceed or seek recourse against or with respect to any property or asset of, any other Grantor (the "Foreclosed Grantor"), including after payment in full of the Obligations, if all or any portion of the Obligations have been satisfied in connection with an exercise of remedies in respect of the Equity Interests of such Foreclosed Grantor whether pursuant to this Agreement or otherwise.

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(v)Each of the Guarantors hereby acknowledges and affirms that it understands that to the extent the Guarantied Obligations are secured by Real Property located in California, Guarantors shall be liable for the full amount of the liability hereunder notwithstanding the foreclosure on such Real Property by trustee sale or any other reason impairing such Guarantor's right to proceed against any Loan Party.  In accordance with Section 2856 of the California Code of Civil Procedure or any similar laws of any other applicable jurisdiction, each of the Guarantors hereby waives until such time as the Guarantied Obligations have been paid in full:

(1)all rights of subrogation, reimbursement, indemnification, and contribution and any other rights and defenses that are or may become available to the Guarantors by reason of Sections 2787 to 2855, inclusive, 2899, and 3433 of the California Code of Civil Procedure or any similar laws of any other applicable jurisdiction;

(2)all rights and defenses that the Guarantors may have because the Guarantied Obligations are secured by Real Property located in California, meaning, among other things, that:  (A) Secured Party, Lender, and the Bank Product Providers may collect from the Guarantors without first foreclosing on any real or personal property collateral pledged by Borrower or any other Grantor, and (B) if Secured Party, on behalf of itself, forecloses on any Real Property collateral pledged by Borrower or any other Grantor, (1) the amount of the Guarantied Obligations may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price, and (2) Lender may collect from the Guarantors even if, by foreclosing on the Real Property collateral, Secured Party or Lender have destroyed or impaired any right the Guarantors may have to collect from any other Grantor, it being understood that this is an unconditional and irrevocable waiver of any rights and defenses the Guarantors may have because the Guarantied Obligations are secured by Real Property (including, without limitation, any rights or defenses based upon Sections 580a, 580d, or 726 of the California Code of Civil Procedure or any similar laws of any other applicable jurisdiction); and

(3)all rights and defenses arising out of an election of remedies by Secured Party, Lender, and the Bank Product Providers, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for the Guarantied Obligations, has destroyed Guarantors' rights of subrogation and reimbursement against any Grantor by the operation of Section 580d of the California Code of Civil Procedure or any similar laws of any other applicable jurisdiction or otherwise.

(vi)Each of the Guarantors represents, warrants, and agrees that each of the waivers set forth above is made with full knowledge of its significance and consequences and that if any of such waivers are determined to be contrary to any applicable law or public policy, such waivers shall be effective to the maximum extent permitted by law.

(vii)The provisions in this Section 2 which refer to certain sections of the California Civil Code are included in this Guaranty solely out of an abundance of caution and shall not be construed to mean that any of the above-referenced provisions of California law are in any way applicable to this Guaranty.

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(j)Keepwell.  Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Grantor to guaranty and otherwise honor all Obligations in respect of Swap Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 2(j) for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 2(j), or otherwise under the Loan Documents, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount).  The obligations of each Qualified ECP Guarantor under this Section shall remain in full force and effect until payment in full of the Guarantied Obligations.  Each Qualified ECP Guarantor intends that this Section 2(j) constitute, and this Section 2(j) shall be deemed to constitute, a "keepwell, support, or other agreement" for the benefit of each other Grantor for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

3.Grant of Security.  Each Grantor hereby unconditionally grants, assigns, and pledges to Secured Party, for the benefit of itself, as Lender, and each of the Bank Product Providers, to secure the Secured Obligations, a continuing security interest (hereinafter referred to as the "Security Interest") in all of such Grantor's right, title, and interest in and to the following, whether now owned or hereafter acquired or arising and wherever located (the "Collateral"):

(a)all of such Grantor's Accounts;

(b)all of such Grantor's Chattel Paper;

(c)all of such Grantor's Deposit Accounts;

(d)all of such Grantor's Equipment;

(e)all of such Grantor's Fixtures located at the Headquarters Facility and the Radio Tower Facilities;

(f)all of such Grantor's General Intangibles;

(g)all of such Grantor's Securities Accounts;

(h)all of such Grantor's Investment Property;

(i)all of such Grantor's Pledged Interests (including all of such Grantor's Pledged Operating Agreements and Pledged Partnership Agreements);

(j)all of such Grantor's right to receive monies, proceeds, or other consideration in connection with the sale, assignment, transfer, or other disposition of any FCC Authorization, the proceeds from the sale of any FCC Authorization or any goodwill or intangible rights or benefits associated therewith;

(k)all of such Grantor's Negotiable Collateral (including all of such Grantor's Pledged Notes) relating to, substituted or exchanged for, evidencing, supporting or rising from the Collateral set forth in clauses (a) through (j) above;

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(l)all of such Grantor's Books;

(m)all of such Grantor's Supporting Obligations;

(n)all of such Grantor's money, Cash Equivalents, or other similar assets of such Grantor that now or hereafter come into the possession, custody, or control of Secured Party (or its Secured Party or designee) or Lender; and

(o)all of the proceeds (as such term is defined in the Code) and products, whether tangible or intangible, of any of the foregoing, including proceeds of insurance covering or relating to any or all of the foregoing, and any and all Accounts, Books, Chattel Paper, Deposit Accounts, Equipment, Fixtures, General Intangibles, Inventory, Investment Property, Negotiable Collateral, Pledged Interests, Securities Accounts, Supporting Obligations, money, or other tangible or intangible property resulting from the sale, lease, license, exchange, collection, or other disposition of any of the foregoing, the proceeds of any award in condemnation with respect to any of the foregoing, any rebates or refunds, whether for taxes or otherwise, and all proceeds of any such proceeds, or any portion thereof or interest therein, and the proceeds thereof, and all proceeds of any loss of, damage to, or destruction of the above, whether insured or not insured, and, to the extent not otherwise included, any indemnity, warranty, or guaranty payable by reason of loss or damage to, or otherwise with respect to any of the foregoing (the "Proceeds").  Without limiting the generality of the foregoing, the term "Proceeds" includes whatever is receivable or received when Investment Property or proceeds are sold, exchanged, collected, or otherwise disposed of, whether such disposition is voluntary or involuntary, and includes proceeds of any indemnity or guaranty payable to any Grantor or Secured Party from time to time with respect to any of the Investment Property.

Notwithstanding anything contained in this Agreement to the contrary, the term "Collateral" shall not include: (i) Equity Interests of any Person other than the Pledged Companies, (ii) any rights or interest in any contract, lease, permit, license, or license agreement covering real or personal property of any Grantor if under the terms of such contract, lease, permit, license, or license agreement, or applicable law with respect thereto, the grant of a security interest or lien therein is prohibited as a matter of law or under the terms of such contract, lease, permit, license, or license agreement and such prohibition or restriction has not been waived or the consent of the other party to such contract, lease, permit, license, or license agreement has not been obtained (provided, that, (A) the foregoing exclusions of this clause (ii) shall in no way be construed (1) to apply to the extent that any described prohibition or restriction is ineffective under Section 9‐406, 9-407, 9-408, or 9-409 of the Code or other applicable law, or (2) to apply to the extent that any consent or waiver has been obtained that would permit Secured Party's security interest or lien to attach notwithstanding the prohibition or restriction on the pledge of such contract, lease, permit, license, or license agreement and (B) the foregoing exclusions of clauses (i) and (ii) shall in no way be construed to limit, impair, or otherwise affect any of Secured Party's, Lender's or any Bank Product Provider's continuing security interests in and liens upon any rights or interests of any Grantor in or to (1) monies due or to become due under or in connection with any described Equity Interests of the Pledged Companies or any contract, lease, permit, license or license agreement that constitutes Collateral (including any Equity Interests of the Pledged Companies or any Accounts), or (2) any proceeds from the sale, license, lease, or other dispositions of any such Equity Interests of the Pledged Companies or any contract, lease, permit, license or license agreement that constitutes Collateral), (iii) any Equipment of any Grantor located at the Headquarters Facility or the Whitestown Facility as of the Closing Date, together with all replacements, repairs, accessions and accessories incorporated therein or affixed or attached thereto, (iv) any Intellectual Property or any Intellectual Property Licenses of any Grantor (including, for the avoidance of doubt, any Intellectual Property or Intellectual Property Licenses that constitute General Intangibles), (v) the Digonex Note, and (vi) the Austin Deposit Account (collectively, items (i) through (vi) above, the "Excluded Property"). Furthermore, notwithstanding anything herein or therein to the contrary, to the extent this Agreement or any other Loan Document purports to grant or to require any Loan Party to grant to Security Party a security interest in the FCC Authorizations of any Loan Party, Security Party shall only have a security interest in such FCC Authorizations at such times and to the extent that a security interest in such FCC Authorizations is permitted under applicable law, including the Communications Laws.

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4.Security for Secured Obligations.  The Security Interest created hereby secures the payment and performance of the Secured Obligations, whether now existing or arising hereafter.  Without limiting the generality of the foregoing, this Agreement secures the payment of all amounts which constitute part of the Secured Obligations and would be owed by Grantors, or any of them, to Secured Party, Lender, the Bank Product Providers or any of them, but for the fact that they are unenforceable or not allowable (in whole or in part) as a claim in an Insolvency Proceeding involving any Grantor due to the existence of such Insolvency Proceeding.

5.Grantors Remain Liable.  Anything herein to the contrary notwithstanding, (a) each of the Grantors shall remain liable under the contracts and agreements included in the Collateral, including the Pledged Operating Agreements and the Pledged Partnership Agreements, to perform all of the duties and obligations thereunder to the same extent as if this Agreement had not been executed, (b) the exercise by Secured Party or Lender of any of the rights hereunder shall not release any Grantor from any of its duties or obligations under such contracts and agreements included in the Collateral, and (c) Lender shall not have any obligation or liability under such contracts and agreements included in the Collateral by reason of this Agreement, nor shall Lender be obligated to perform any of the obligations or duties of any Grantors thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.  Until an Event of Default shall occur and be continuing, except as otherwise provided in this Agreement, the Credit Agreement, or any other Loan Document, Grantors shall have the right to possession and enjoyment of the Collateral for the purpose of conducting the ordinary course of their respective businesses, subject to and upon the terms hereof and of the Credit Agreement and the other Loan Documents.  Without limiting the generality of the foregoing, it is the intention of the parties hereto that record and beneficial ownership of the Pledged Interests, including all voting, consensual, dividend, and distribution rights, shall remain in the applicable Grantor until (i) the occurrence and continuance of an Event of Default and (ii) Secured Party has notified the applicable Grantor of Secured Party's election to exercise such rights with respect to the Pledged Interests pursuant to Section 16.

6.Representations and Warranties.  In order to induce Secured Party to enter into this Agreement for the benefit of itself, as Lender, and the Bank Product Providers, each Grantor makes the following representations and warranties to Lender which shall be true, correct, and complete, in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the Closing Date, and shall be true, correct, and complete, in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the date of the making of each Revolving Loan (or other extension of credit) made thereafter, as though made on and as of the date of such Revolving Loan (or other extension of credit) (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of such earlier date) and such representations and warranties shall survive the execution and delivery of this Agreement:

(a)The name (within the meaning of Section 9-503 of the Code) and jurisdiction of organization of each Grantor and each of its Restricted Subsidiaries is set forth on Schedule 7 (as such Schedule may be updated from time to time to reflect changes resulting from transactions permitted under the Loan Documents).

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(b)The chief executive office of each Grantor and each of its Restricted Subsidiaries is located at the address indicated on Schedule 7 (as such Schedule may be updated from time to time to reflect changes resulting from transactions permitted under the Loan Documents).

(c)Each Grantor's and each of its Restricted Subsidiaries' tax identification numbers and organizational identification numbers, if any, are identified on Schedule 7 (as such Schedule may be updated from time to time to reflect changes resulting from transactions permitted under the Loan Documents).

(d)[Reserved].

(e)Set forth on Schedule 9 (as such Schedule may be updated from time to time subject to Section 7(k)(iii) with respect to Controlled Accounts and provided that Grantors comply with Section 7(c) hereof) is a listing of all of Grantors' and their Restricted Subsidiaries' Deposit Accounts and Securities Accounts, including, with respect to each bank or securities intermediary (i) the name and, except to the extent such bank is Wells Fargo Bank, National Association, address of such Person, and (ii) the account numbers of the Deposit Accounts or Securities Accounts maintained with such Person.

(f)[Reserved].

(g)[Reserved].

(h)(i) (A) except for Permitted Liens, each Grantor owns exclusively or holds licenses in all Intellectual Property that is necessary in or material to the conduct of its business, and (B) all employees and contractors of each Grantor who were involved in the creation or development of any Intellectual Property for such Grantor that is necessary in or material to the business of such Grantor have signed agreements containing assignment of Intellectual Property rights to such Grantor and obligations of confidentiality;

(ii)to each Grantor's knowledge after reasonable inquiry, no Person has infringed or misappropriated or is currently infringing or misappropriating any Intellectual Property rights owned by such Grantor, in each case, that either individually or in the aggregate could reasonably be expected to result in a Material Adverse Effect;

(iii)(A) to each Grantor's knowledge after reasonable inquiry, (1) such Grantor has never infringed or misappropriated and is not currently infringing or misappropriating any Intellectual Property rights of any Person, and (2) no product manufactured, used, distributed, licensed, or sold by or service provided by such Grantor has ever infringed or misappropriated or is currently infringing or misappropriating any Intellectual Property rights of any Person, in each case, except where such infringement either individually or in the aggregate could not reasonably be expected to result in a Material Adverse Effect, and (B) there are no infringement or misappropriation claims or proceedings pending, or to any Grantor's knowledge after reasonable inquiry, threatened in writing against any Grantor, and no Grantor has received any written notice or other communication of any actual or alleged infringement or misappropriation of any Intellectual Property rights of any Person, in each case, except where such infringement either individually or in the aggregate could not reasonably be expected to result in a Material Adverse Effect;

(iv)to each Grantor's knowledge after reasonable inquiry, all registered Copyrights, registered Trademarks, and issued Patents that are owned by such Grantor and necessary in or material to the conduct of its business are valid, subsisting and enforceable and in compliance with all legal requirements, filings, and payments and other actions that are required to maintain such Intellectual Property in full force and effect, and

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(v)each Grantor has taken reasonable steps to maintain the confidentiality of and otherwise protect and enforce its rights in all trade secrets owned by such Grantor that are necessary in or material to the conduct of the business of such Grantor, 

(i)This Agreement creates a valid security interest in the Collateral of each Grantor, to the extent a security interest therein can be created under the Code, securing the payment of the Secured Obligations.  Except to the extent a security interest in the Collateral cannot be perfected by the filing of a financing statement under the Code, all filings and other actions necessary or desirable to perfect and protect such security interest have been duly taken or will have been taken upon the filing of financing statements listing each applicable Grantor, as a debtor, and Secured Party, as secured party, in the jurisdictions listed next to such Grantor's name on Schedule 11.  Upon the making of such filings, Secured Party shall have a first priority perfected security interest in the Collateral of each Grantor to the extent such security interest can be perfected by the filing of a financing statement. All action by any Grantor necessary to protect and perfect such security interest on each item of Collateral has been duly taken.

(j)(i) Except for the Security Interest created hereby, each Grantor is and will at all times be the sole holder of record and the legal and beneficial owner, free and clear of all Liens other than Permitted Liens, of the Pledged Interests indicated on Schedule 5 as being owned by such Grantor and, when acquired by such Grantor, any Pledged Interests acquired after the Closing Date; (ii) all of the Pledged Interests are duly authorized, validly issued, fully paid and nonassessable and the Pledged Interests constitute or will constitute the percentage of the issued and outstanding Equity Interests of the Pledged Companies of such Grantor identified on Schedule 5 as supplemented or modified by any Pledged Interests Addendum or any Joinder to this Agreement; (iii) such Grantor has the right and requisite authority to pledge, the Investment Property pledged by such Grantor to Secured Party as provided herein; (iv) all actions necessary or desirable to perfect and establish the first priority of, or otherwise protect, Secured Party's Liens in the Investment Property, and the proceeds thereof, have been duly taken, upon (A) the execution and delivery of this Agreement; (B) the taking of possession by Secured Party (or its Secured Party or designee) of any certificates representing the Pledged Interests, together with undated powers (or other documents of transfer acceptable to Secured Party) endorsed in blank by the applicable Grantor; (C) the filing of financing statements in the applicable jurisdiction set forth on Schedule 11 for such Grantor with respect to the Pledged Interests of such Grantor that are not represented by certificates, and (D) with respect to any Securities Accounts, the delivery of Control Agreements with respect thereto; and (v) each Grantor has delivered to and deposited with Secured Party all certificates representing the Pledged Interests owned by such Grantor to the extent such Pledged Interests are represented by certificates, and undated powers (or other documents of transfer acceptable to Secured Party) endorsed in blank with respect to such certificates. None of the Pledged Interests owned or held by such Grantor has been issued or transferred in violation of any securities registration, securities disclosure, or similar laws of any jurisdiction to which such issuance or transfer may be subject.

(k)No consent, approval, authorization, or other order or other action by, and no notice to or filing with, any Governmental Authority or any other Person is required (i) for the grant of a Security Interest by such Grantor in and to the Collateral pursuant to this Agreement or for the execution, delivery, or performance of this Agreement by such Grantor, or (ii) for the exercise by Secured Party of the voting or other rights provided for in this Agreement with respect to the Investment Property or the remedies in respect of the Collateral pursuant to this 

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Agreement, except (x) as may be required in connection with such disposition of Investment Property by laws affecting the offering and sale of securities generally, (y) except for consents, approvals, authorizations, or other orders or actions that have been obtained or given (as applicable) and that are still in force, and (z) for the consent of the FCC to any transfer of control or assignment of the FCC Authorizations to the extent necessary to enforce any rights or remedies under this Agreement or under any other Loan Document.  

(l)[Reserved].

(m)There is no default, breach, violation, or event of acceleration existing under any promissory note (as defined in the Code) constituting Collateral and pledged hereunder (each a "Pledged Note") and no event has occurred or circumstance exists which, with the passage of time or the giving of notice, or both, would constitute a default, breach, violation, or event of acceleration under any Pledged Note.  No Grantor that is an obligee under a Pledged Note has waived any default, breach, violation, or event of acceleration under such Pledged Note.

(n)As to all limited liability company or partnership interests, issued under any Pledged Operating Agreement or Pledged Partnership Agreement, each Grantor hereby represents and warrants that the Pledged Interests issued pursuant to such agreement (A) are not dealt in or traded on securities exchanges or in securities markets, (B) do not constitute investment company securities, and (C) are not held by such Grantor in a Securities Account.  In addition, none of the Pledged Operating Agreements, the Pledged Partnership Agreements, or any other agreements governing any of the Pledged Interests issued under any Pledged Operating Agreement or Pledged Partnership Agreement, provide that such Pledged Interests are securities governed by Article 8 of the Uniform Commercial Code as in effect in any relevant jurisdiction.

7.Covenants.  Each Grantor, jointly and severally, covenants and agrees with Secured Party that from and after the date of this Agreement and until the date of termination of this Agreement in accordance with Section 23:

(a)Possession of Collateral.  In the event that any Collateral, including Proceeds, is evidenced by or consists of Negotiable Collateral, Investment Property, or Chattel Paper having an aggregate value or face amount of $300,000 or more for all such Negotiable Collateral, Investment Property, or Chattel Paper, the Grantors shall promptly (and in any event within five (5) Business Days after acquisition thereof), notify Secured Party thereof, and if and to the extent that perfection or priority of Secured Party's Security Interest is dependent on or enhanced by possession, the applicable Grantor, promptly (and in any event within five (5) Business Days) after request by Secured Party, shall execute such other documents and instruments as shall be requested by Secured Party or, if applicable, endorse and deliver physical possession of such Negotiable Collateral, Investment Property, or Chattel Paper to Secured Party, together with such undated powers (or other relevant document of transfer acceptable to Secured Party) endorsed in blank as shall be requested by Secured Party, and shall do such other acts or things deemed necessary or desirable by Secured Party to protect Secured Party's Security Interest therein;

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(b)Chattel Paper.

(i)Promptly (and in any event within five (5) Business Days) after request by Secured Party, each Grantor shall take all steps reasonably necessary to grant Secured Party control of all electronic Chattel Paper in accordance with the Code and all "transferable records" as that term is defined in Section 16 of the Uniform Electronic Transaction Act and Section 201 of the federal Electronic Signatures in Global and National Commerce Act as in effect in any relevant jurisdiction, to the extent that the aggregate value or face amount of such electronic Chattel Paper equals or exceeds $300,000;

(ii)If any Grantor retains possession of any Chattel Paper or instruments (which retention of possession shall be subject to the extent permitted hereby and by the Credit Agreement), promptly upon the request of Secured Party, such Chattel Paper and instruments shall be marked with the following legend: "This writing and the obligations evidenced or secured hereby are subject to the Security Interest of Wells Fargo Bank, National Association, as Secured Party for the benefit of itself, as Lender, and the Bank Product Providers";

(c)Control Agreements.

(i)Except to the extent otherwise excused by Section 7(k)(iv), each Grantor shall obtain an authenticated Control Agreement (which may include a Controlled Account Agreement), from each bank maintaining a Deposit Account or Securities Account for such Grantor;

(ii)Except to the extent otherwise excused by Section 7(k)(iv), each Grantor shall obtain an authenticated Control Agreement, from each issuer of uncertificated securities, securities intermediary, or commodities intermediary issuing or holding any financial assets or commodities to or for any Grantor, or maintaining a Securities Account for such Grantor; and

(iii)Except to the extent otherwise excused by Section 7(k)(iv), each Grantor shall obtain an authenticated Control Agreement with respect to all of such Grantor's investment property;

(d)Letter-of-Credit Rights.  If the Grantors (or any of them) are or become the beneficiary of letters of credit having a face amount or value of $300,000 or more in the aggregate, then the applicable Grantor or Grantors shall promptly (and in any event within five (5) Business Days after becoming a beneficiary), notify Secured Party thereof and, promptly (and in any event within five (5) Business Days) after request by Secured Party, enter into a tri-party agreement with Secured Party and the issuer or confirming bank with respect to letter-of-credit rights assigning such letter-of-credit rights to Secured Party and directing all payments thereunder to Secured Party's account, all in form and substance reasonably satisfactory to Secured Party;

(e)[Reserved];

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(f)Government Contracts.  If any Account or Chattel Paper arises out of a contract or contracts with the United States of America or any department, agency, or instrumentality thereof and either, (i) the aggregate value of all such Accounts and Chattel Paper equals or exceeds an amount equal to 15% of all of Grantors' Accounts or (ii) any Default or Event of Default has occurred and is continuing, Grantors shall promptly (and in any event within five (5) Business Days of the creation thereof) notify Secured Party thereof and, promptly (and in any event within five (5) Business Days) after request by Secured Party, execute any instruments or take any steps reasonably required by Secured Party in order that all moneys due or to become due under such contract or contracts shall be assigned to Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, and shall provide written notice thereof under the Assignment of Claims Act or other applicable law;

(g)Intellectual Property.

(i)Each Grantor shall have the duty, with respect to Intellectual Property that is necessary in or material to the conduct of such Grantor's business, to protect and diligently enforce and defend at such Grantor's expense its Intellectual Property.  Each Grantor further agrees not to abandon any Intellectual Property or Intellectual Property License that is necessary in or material to the conduct of such Grantor's business;

(ii)Grantors acknowledge and agree that Lender shall have no duties with respect to any Intellectual Property or Intellectual Property Licenses of any Grantor. 

(iii)Each Grantor shall take reasonable steps to maintain the confidentiality of, and otherwise protect and enforce its rights in, the Intellectual Property that is necessary in or material to the conduct of such Grantor's business; 

(h)Investment Property.

(i)If any Grantor shall acquire, obtain, receive or become entitled to receive any Pledged Interests after the Closing Date, it shall promptly (and in any event within five (5) Business Days of acquiring or obtaining such Collateral) deliver to Secured Party a duly executed Pledged Interests Addendum identifying such Pledged Interests;

(ii)Upon the occurrence and during the continuance of an Event of Default, following the request of Secured Party, all sums of money and property paid or distributed in respect of the Investment Property that are received by any Grantor shall be held by the Grantors in trust for the benefit of Secured Party segregated from such Grantor's other property, and such Grantor shall deliver it forthwith to Secured Party in the exact form received;

(iii)Each Grantor shall promptly deliver to Secured Party a copy of each material notice or other material communication received by it in respect of any Pledged Interests;

(iv)No Grantor shall make or consent to any amendment or other modification or waiver with respect to any Pledged Interests, Pledged Operating Agreement, or Pledged Partnership Agreement, or enter into any agreement or permit to exist any restriction with respect to any Pledged Interests if the same is prohibited pursuant to the Loan Documents;

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(v)Each Grantor agrees that it will cooperate with Secured Party in obtaining all necessary approvals and making all necessary filings under federal, state, local, or foreign law to effect the perfection of the Security Interest on the Investment Property or to effect any sale or transfer thereof;

(vi)As to all limited liability company or partnership interests, issued under any Pledged Operating Agreement or Pledged Partnership Agreement, each Grantor hereby covenants that the Pledged Interests issued pursuant to such agreement (A) are not and shall not be dealt in or traded on securities exchanges or in securities markets, (B) do not and will not constitute investment company securities, and (C) are not and will not be held by such Grantor in a securities account.  In addition, none of the Pledged Operating Agreements, the Pledged Partnership Agreements, or any other agreements governing any of the Pledged Interests issued under any Pledged Operating Agreement or Pledged Partnership Agreement, provide or shall provide that such Pledged Interests are securities governed by Article 8 of the Uniform Commercial Code as in effect in any relevant jurisdiction.

(i)[Reserved].

(j)Transfers and Other Liens.  Grantors shall not (i) sell, assign (by operation of law or otherwise) or otherwise dispose of, or grant any option with respect to, any of the Collateral, except for Permitted Dispositions, or (ii) create or permit to exist any Lien upon or with respect to any of the Collateral of any Grantor, except for Permitted Liens.  The inclusion of Proceeds in the Collateral shall not be deemed to constitute Secured Party's consent to any sale or other disposition of any of the Collateral except as expressly permitted in this Agreement or the other Loan Documents;

(k)Controlled Accounts; Controlled Investments.

(i)Each Grantor shall (A) establish and maintain cash management services of a type and on terms reasonably satisfactory to Secured Party at one or more of the banks set forth on Schedule 10 (each a "Controlled Account Bank"), and shall take reasonable steps to ensure that all of its and its Subsidiaries' Account Debtors forward payment of the amounts owed by them directly to such Controlled Account Bank, and (B) deposit or cause to be deposited promptly, and in any event no later than the first Business Day after the date of receipt thereof, all of their Collections (including those sent directly by their Account Debtors to a Grantor) into a bank account of such Grantor (each, a "Controlled Account") at one of the Controlled Account Banks.

(ii)Each Grantor shall establish and maintain Controlled Account Agreements with Secured Party and the applicable Controlled Account Bank, in form and substance reasonably acceptable to Secured Party.  Each such Controlled Account Agreement shall provide, among other things, that (A) the Controlled Account Bank will comply with any instructions originated by Secured Party directing the disposition of the funds in such Controlled Account without further consent by the applicable Grantor, (B) the Controlled Account Bank waives, subordinates, or agrees not to exercise any rights of setoff or recoupment or any other claim against the applicable Controlled Account other than for payment of its service fees and other charges directly related to the administration of such Controlled Account and for returned checks or other items of payment, and (C) upon the instruction of Secured Party (an "Activation Instruction"), the Controlled Account Bank will forward by daily sweep all amounts in the applicable Controlled Account to the Secured Party's Account.  Secured Party agrees not to issue an Activation Instruction with respect to the Controlled Accounts unless a Triggering Event has occurred and is continuing at the time such Activation Instruction is issued.  Secured Party agrees to use commercially reasonable efforts to rescind an Activation Instruction (the "Rescission") if:  (1) no Cash Dominion Period is in effect, and (2) no additional Triggering Event has occurred and is continuing prior to the date of the Rescission or is reasonably expected to occur on or immediately after the date of the Rescission.

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(iii)So long as no Default or Event of Default has occurred and is continuing, Borrower may amend Schedule 10 to add or replace a Controlled Account Bank or Controlled Account and shall upon such addition or replacement provide to Secured Party an amended Schedule 10; provided, however, that (A) such prospective Controlled Account Bank shall be reasonably satisfactory to Secured Party, and (B) prior to the time of the opening of such Controlled Account, the applicable Grantor and such prospective Controlled Account Bank shall have executed and delivered to Secured Party a Controlled Account Agreement.  Each Grantor shall close any of its Controlled Accounts (and establish replacement Controlled Account accounts in accordance with the foregoing sentence) as promptly as practicable and in any event within forty-five (45) days after notice from Secured Party that the operating performance, funds transfer, or availability procedures or performance of the Controlled Account Bank with respect to Controlled Account Accounts or Secured Party's liability under any Controlled Account Agreement with such Controlled Account Bank is no longer acceptable in Secured Party's reasonable judgment.

(iv)Other than (i) an aggregate amount of not more than $250,000 at any one time, in the case of Grantors and their Subsidiaries, and (ii) amounts deposited into Deposit Accounts specially and exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for any Grantor's or its Subsidiaries' employees, no Grantor will, and no Grantor will permit its Subsidiaries to, make, acquire, or permit to exist Permitted Investments consisting of cash, Cash Equivalents, or amounts credited to Deposit Accounts or Securities Accounts unless Grantor or its Restricted Subsidiary, as applicable, and the applicable bank or securities intermediary have entered into Control Agreements with Secured Party governing such Permitted Investments in order to perfect (and further establish) Secured Party's Liens in such Permitted Investments.

(l)Name, Etc.  No Grantor will, nor will any Grantor permit any of its Subsidiaries to, change its name, organizational identification number, jurisdiction of organization or organizational identity; provided, that Grantor or any of its Subsidiaries may change its name upon at least 10 days prior written notice to Secured Party of such change.

(m)[Reserved].

(n)Pledged Notes.   Grantors (i) without the prior written consent of Secured Party, will not (A) waive or release any obligation of any Person that is obligated under any of the Pledged Notes, (B) take or omit to take any action or knowingly suffer or permit any action to be omitted or taken, the taking or omission of which would result in any right of offset against sums payable under the Pledged Notes, or (C) other than Permitted Dispositions, assign or surrender their rights and interests under any of the Pledged Notes or terminate, cancel, modify, change, supplement or amend the Pledged Notes, and (ii) shall provide to Secured Party copies of all material written notices (including notices of default) given or received with respect to the Pledged Notes promptly after giving or receiving such notice.

(o)Account Verification. Each Grantor will, and will cause each of its Subsidiaries to, permit Secured Party, in Secured Party's name or in the name of a nominee of Secured Party, to verify the validity, amount or any other matter relating to any Account, by mail, telephone, facsimile transmission or otherwise.  Further, at the request of Secured Party, Grantors shall send requests for verification of Accounts or send notices of assignment of Accounts to Account Debtors and other obligors.

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8.Relation to Other Security Documents.  The provisions of this Agreement shall be read and construed with the other Loan Documents referred to below in the manner so indicated.

(a)Credit Agreement. In the event of any conflict between any provision in this Agreement and a provision in the Credit Agreement, such provision of the Credit Agreement shall control.

9.Further Assurances.

(a)Each Grantor agrees that from time to time, at its own expense, such Grantor will promptly execute and deliver all further instruments and documents, and take all further action, that Secured Party may reasonably request, in order to perfect and protect the Security Interest granted hereby, to create, perfect or protect the Security Interest purported to be granted hereby or to enable Secured Party to exercise and enforce its rights and remedies hereunder with respect to any of the Collateral.

(b)Each Grantor authorizes the filing by Secured Party of financing or continuation statements, or amendments thereto, and such Grantor will execute and deliver to Secured Party such other instruments or notices, as Secured Party may reasonably request, in order to perfect and preserve the Security Interest granted or purported to be granted hereby.

(c)Each Grantor authorizes Secured Party at any time and from time to time to file, transmit, or communicate, as applicable, financing statements and amendments (i) describing the Collateral as "all personal property of debtor" or "all assets of debtor" or words of similar effect, (ii) describing the Collateral as being of equal or lesser scope or with greater detail, or (iii) that contain any information required by part 5 of Article 9 of the Code for the sufficiency or filing office acceptance.  Each Grantor also hereby ratifies any and all financing statements or amendments previously filed by Secured Party in any jurisdiction.

(d)Each Grantor acknowledges that it is not authorized to file any financing statement or amendment or termination statement with respect to any financing statement filed in connection with this Agreement without the prior written consent of Secured Party, subject to such Grantor's rights under Section 9-509(d)(2) of the Code.

10.Secured Party's Right to Perform Contracts, Exercise Rights, etc.  Upon the occurrence and during the continuance of an Event of Default, Secured Party (or its designee) (a) may proceed to perform any and all of the obligations of any Grantor contained in any contract, lease, or other agreement and exercise any and all rights of any Grantor therein contained as fully as such Grantor itself could, (b) shall have the right to use any Grantor's rights under Intellectual Property Licenses in connection with the enforcement of Secured Party's rights hereunder, including the right to prepare for sale and sell any and all Equipment that constitutes Collateral now or hereafter owned by any Grantor and now or hereafter covered by such licenses, and (c) shall have the right to request that any Equity Interests that are pledged hereunder be registered in the name of Secured Party or any of its nominees.

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11.Secured Party Appointed Attorney-in-Fact.  Each Grantor hereby irrevocably appoints Secured Party its attorney-in-fact, with full authority in the place and stead of such Grantor and in the name of such Grantor or otherwise, at such time as an Event of Default has occurred and is continuing under the Credit Agreement, to take any action and to execute any instrument which Secured Party may reasonably deem necessary or advisable to accomplish the purposes of this Agreement, including:

(a)to ask, demand, collect, sue for, recover, compromise, receive and give acquittance and receipts for moneys due and to become due under or in connection with the Accounts or any other Collateral of such Grantor;

(b)to receive and open all mail addressed to such Grantor and to notify postal authorities to change the address for the delivery of mail to such Grantor to that of Secured Party;

(c)to receive, indorse, and collect any drafts or other instruments, documents, Negotiable Collateral or Chattel Paper;

(d)to file any claims or take any action or institute any proceedings which Secured Party may deem necessary or desirable for the collection of any of the Collateral of such Grantor or otherwise to enforce the rights of Secured Party with respect to any of the Collateral;

(e)to repair, alter, or supply goods, if any, necessary to fulfill in whole or in part the purchase order of any Person obligated to such Grantor in respect of any Account of such Grantor; and

(f)to use any Intellectual Property or Intellectual Property Licenses of such Grantor, including but not limited to any labels, Patents, Trademarks, trade names, URLs, domain names, industrial designs, Copyrights, or advertising matter, in preparing for sale, advertising for sale, or selling Collateral and to collect any amounts due under Accounts, contracts or Negotiable Collateral of such Grantor; 

To the extent permitted by law, each Grantor hereby ratifies all that such attorney-in-fact shall lawfully do or cause to be done by virtue hereof.  This power of attorney is coupled with an interest and shall be irrevocable until this Agreement is terminated.

12.Secured Party May Perform.  If any Grantor fails to perform any agreement contained herein, Secured Party may itself perform, or cause performance of, such agreement, and the reasonable expenses of Secured Party incurred in connection therewith shall be payable, jointly and severally, by Grantors.

13.Secured Party's Duties.  The powers conferred on Secured Party hereunder are solely to protect Secured Party's interest in the Collateral, for the benefit of itself, as Lender, and the Bank Product Providers, and shall not impose any duty upon Secured Party to exercise any such powers.  Except for the safe custody of any Collateral in its actual possession and the accounting for moneys actually received by it hereunder, Secured Party shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.  Secured Party shall be deemed to have exercised reasonable care in the custody and preservation of any Collateral in its actual possession if such Collateral is accorded treatment substantially equal to that which Secured Party accords its own property.

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14.Collection of Accounts, General Intangibles and Negotiable Collateral.  At any time upon the occurrence and during the continuance of an Event of Default, Secured Party or Secured Party's designee may (a) notify Account Debtors of any Grantor that the Accounts, General Intangibles, Chattel Paper or Negotiable Collateral of such Grantor have been assigned to Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, or that Secured Party has a security interest therein, and (b) collect the Accounts, General Intangibles and Negotiable Collateral of any Grantor directly, and any collection costs and expenses shall constitute part of such Grantor's Secured Obligations under the Loan Documents.

15.Disposition of Pledged Interests by Secured Party.  None of the Pledged Interests existing as of the date of this Agreement are, and none of the Pledged Interests hereafter acquired on the date of acquisition thereof will be, registered or qualified under the various federal or state securities laws of the United States and disposition thereof after an Event of Default may be restricted to one or more private (instead of public) sales in view of the lack of such registration.  Each Grantor understands that in connection with such disposition, Secured Party may approach only a restricted number of potential purchasers and further understands that a sale under such circumstances may yield a lower price for the Pledged Interests than if the Pledged Interests were registered and qualified pursuant to federal and state securities laws and sold on the open market.  Each Grantor, therefore, agrees that:  (a) if Secured Party shall, pursuant to the terms of this Agreement, sell or cause the Pledged Interests or any portion thereof to be sold at a private sale, Secured Party shall have the right to rely upon the advice and opinion of any nationally recognized brokerage or investment firm (but shall not be obligated to seek such advice and the failure to do so shall not be considered in determining the commercial reasonableness of such action) as to the best manner in which to offer the Pledged Interest or any portion thereof for sale and as to the best price reasonably obtainable at the private sale thereof; and (b) such reliance shall be conclusive evidence that Secured Party has handled the disposition in a commercially reasonable manner.

16.Voting and Other Rights in Respect of Pledged Interests.

(a)Upon the occurrence and during the continuation of an Event of Default, (i) Secured Party may, at its option, and with prior notice to any Grantor, and in addition to all rights and remedies available to Secured Party under any other agreement, at law, in equity, or otherwise, exercise all voting rights, or any other ownership or consensual rights (including any dividend or distribution rights) in respect of the Pledged Interests owned by such Grantor, but under no circumstances is Secured Party obligated by the terms of this Agreement to exercise such rights, and (ii) if Secured Party duly exercises its right to vote any of such Pledged Interests, each Grantor hereby appoints Secured Party, such Grantor's true and lawful attorney-in-fact and IRREVOCABLE PROXY to vote such Pledged Interests in any manner Secured Party deems advisable for or against all matters submitted or which may be submitted to a vote of shareholders, partners or members, as the case may be.  The power-of-attorney and proxy granted hereby is coupled with an interest and shall be irrevocable.

(b)For so long as any Grantor shall have the right to vote the Pledged Interests owned by it, such Grantor covenants and agrees that it will not, without the prior written consent of Secured Party, vote or take any consensual action with respect to such Pledged Interests which would materially adversely affect the rights of Secured Party, Lender, or the Bank Product Providers, or the value of the Pledged Interests.

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17.Remedies.  Upon the occurrence and during the continuance of an Event of Default:

(a)Secured Party may exercise in respect of the Collateral, in addition to other rights and remedies provided for herein, in the other Loan Documents, or otherwise available to it, all the rights and remedies of a secured party on default under the Code or any other applicable law.  Without limiting the generality of the foregoing, each Grantor expressly agrees that, in any such event, Secured Party without demand of performance or other demand, advertisement or notice of any kind (except a notice specified below of time and place of public or private sale) to or upon any Grantor or any other Person (all and each of which demands, advertisements and notices are hereby expressly waived to the maximum extent permitted by the Code or any other applicable law), may take immediate possession of all or any portion of the Collateral and (i) require Grantors to, and each Grantor hereby agrees that it will at its own expense and upon request of Secured Party forthwith, assemble all or part of the Collateral as directed by Secured Party and make it available to Secured Party, and (ii) without notice except as specified below, sell the Collateral or any part thereof in one or more parcels at public or private sale, at any of Secured Party's offices or elsewhere, for cash, on credit, and upon such other terms as Secured Party may deem commercially reasonable.  Each Grantor agrees that, to the extent notification of sale shall be required by law, at least ten (10) days notification by mail to the applicable Grantor of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification and specifically such notification shall constitute a reasonable "authenticated notification of disposition" within the meaning of Section 9-611 of the Code.  Secured Party shall not be obligated to make any sale of Collateral regardless of notification of sale having been given.  Secured Party may adjourn any public sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned.  Each Grantor agrees that (A) the internet shall constitute a "place" for purposes of Section 9-610(b) of the Code and (B) to the extent notification of sale shall be required by law, notification by mail of the URL where a sale will occur and the time when a sale will commence at least ten (10) days prior to the sale shall constitute a reasonable notification for purposes of Section 9-611(b) of the Code.  Each Grantor agrees that any sale of Collateral to a licensor pursuant to the terms of a license agreement between such licensor and a Grantor is sufficient to constitute a commercially reasonable sale (including as to method, terms, manner, and time) within the meaning of Section 9-610 of the Code.

(b)Secured Party is hereby granted a license or other right to use, without liability for royalties or any other charge, each Grantor's Intellectual Property, including but not limited to, any labels, Patents, Trademarks, trade names, URLs, domain names, industrial designs, Copyrights, and advertising matter, whether owned by any Grantor or with respect to which any Grantor has rights under license, sublicense, or other agreements (including any Intellectual Property License), as it pertains to the Collateral, in preparing for sale, advertising for sale and selling any Collateral, and each Grantor's rights under all licenses and all franchise agreements shall inure to the benefit of Secured Party.

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(c)Secured Party may, in addition to other rights and remedies provided for herein, in the other Loan Documents, or otherwise available to it under applicable law and without the requirement of notice to or upon any Grantor or any other Person (which notice is hereby expressly waived to the maximum extent permitted by the Code or any other applicable law), (i) with respect to any Grantor's Deposit Accounts in which Secured Party's Liens are perfected by control under Section 9-104 of the Code, instruct the bank maintaining such Deposit Account for the applicable Grantor to pay the balance of such Deposit Account to or for the benefit of Secured Party, and (ii) with respect to any Grantor's Securities Accounts in which Secured Party's Liens are perfected by control under Section 9-106 of the Code, instruct the securities intermediary maintaining such Securities Account for the applicable Grantor to (A) transfer any cash in such Securities Account to or for the benefit of Secured Party, or (B) liquidate any financial assets in such Securities Account that are customarily sold on a recognized market and transfer the cash proceeds thereof to or for the benefit of Secured Party.

(d)Any cash held by Secured Party as Collateral and all cash proceeds received by Secured Party in respect of any sale of, collection from, or other realization upon all or any part of the Collateral shall be applied against the Secured Obligations in the order set forth in the Credit Agreement.   In the event the proceeds of Collateral are insufficient to satisfy all of the Secured Obligations in full, each Grantor shall remain jointly and severally liable for any such deficiency.

(e)Each Grantor hereby acknowledges that the Secured Obligations arise out of a commercial transaction, and agrees that if an Event of Default shall occur and be continuing Secured Party shall have the right to an immediate writ of possession without notice of a hearing.  Secured Party shall have the right to the appointment of a receiver for the properties and assets of each Grantor, and each Grantor hereby consents to such rights and such appointment and hereby waives any objection such Grantor may have thereto or the right to have a bond or other security posted by Secured Party.

18.Remedies Cumulative.  Each right, power, and remedy of Secured Party, Lender, or any Bank Product Provider as provided for in this Agreement, the other Loan Documents or any Bank Product Agreement now or hereafter existing at law or in equity or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power, or remedy provided for in this Agreement, the other Loan Documents and the Bank Product Agreements or now or hereafter existing at law or in equity or by statute or otherwise, and the exercise or beginning of the exercise by Secured Party, Lender, or any Bank Product Provider, of any one or more of such rights, powers, or remedies shall not preclude the simultaneous or later exercise by Secured Party, Lender or such Bank Product Provider of any or all such other rights, powers, or remedies.

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19.Marshaling. Secured Party shall not be required to marshal any present or future collateral security (including but not limited to the Collateral) for, or other assurances of payment of, the Secured Obligations or any of them or to resort to such collateral security or other assurances of payment in any particular order, and all of its rights and remedies hereunder and in respect of such collateral security and other assurances of payment shall be cumulative and in addition to all other rights and remedies, however existing or arising.  To the extent that it lawfully may, each Grantor hereby agrees that it will not invoke any law relating to the marshaling of collateral which might cause delay in or impede the enforcement of Secured Party's rights and remedies under this Agreement or under any other instrument creating or evidencing any of the Secured Obligations or under which any of the Secured Obligations is outstanding or by which any of the Secured Obligations is secured or payment thereof is otherwise assured, and, to the extent that it lawfully may, each Grantor hereby irrevocably waives the benefits of all such laws.

20.Indemnity and Expenses.

(a)Each Grantor agrees to indemnify Secured Party and Lender from and against all claims, lawsuits and liabilities (including reasonable attorneys' fees) growing out of or resulting from this Agreement (including enforcement of this Agreement) or any other Loan Document to which such Grantor is a party, except claims, losses or liabilities resulting from the bad faith, gross negligence or willful misconduct of the party seeking indemnification as determined by a final non-appealable order of a court of competent jurisdiction.  This provision shall survive the termination of this Agreement and the Credit Agreement and the repayment of the Secured Obligations.

(b)Grantors, jointly and severally, shall, upon demand, pay to Secured Party (or Secured Party, may charge to the Loan Account) all the Lender Expenses which Secured Party may incur in connection with (i) the administration of this Agreement, (ii) the custody, preservation, use or operation of, or, upon an Event of Default, the sale of, collection from, or other realization upon, any of the Collateral in accordance with this Agreement and the other Loan Documents, (iii) the exercise or enforcement of any of the rights of Secured Party hereunder or (iv) the failure by any Grantor to perform or observe any of the provisions hereof.

21.Merger, Amendments; Etc.  THIS AGREEMENT, TOGETHER WITH THE OTHER LOAN DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN AGREEMENTS BETWEEN THE PARTIES.  No waiver of any provision of this Agreement, and no consent to any departure by any Grantor herefrom, shall in any event be effective unless the same shall be in writing and signed by Secured Party, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.  No amendment of any provision of this Agreement shall be effective unless the same shall be in writing and signed by Secured Party and each Grantor to which such amendment applies.

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22.Addresses for Notices.  All notices and other communications provided for hereunder shall be given in the form and manner and delivered to Secured Party at its address specified in the Credit Agreement, and to any of the Grantors at their respective addresses specified in the Credit Agreement or Guaranty, as applicable, or, as to any party, at such other address as shall be designated by such party in a written notice to the other party.

23.Continuing Security Interest: Assignments under Credit Agreement.

(a)This Agreement shall create a continuing security interest in the Collateral and shall (i) remain in full force and effect until the Obligations have been paid in full in accordance with the provisions of the Credit Agreement and the Commitments have expired or have been terminated, (ii) be binding upon each Grantor, and their respective successors and assigns, and (iii) inure to the benefit of, and be enforceable by, Secured Party, and its successors, transferees and assigns.  Without limiting the generality of the foregoing clause (iii), any Lender may, in accordance with the provisions of the Credit Agreement, assign or otherwise transfer all or any portion of its rights and obligations under the Credit Agreement to any other Person, and such other Person shall thereupon become vested with all the benefits in respect thereof granted to such Lender herein or otherwise.  Upon payment in full of the Secured Obligations in accordance with the provisions of the Credit Agreement and the expiration or termination of the Commitments, the Guaranty made and the Security Interest granted hereby shall terminate and all rights to the Collateral shall revert to Grantors or any other Person entitled thereto.  At such time, upon Borrower's request, Secured Party will authorize the filing of appropriate termination statements to terminate such Security Interest.  No transfer or renewal, extension, assignment, or termination of this Agreement or of the Credit Agreement, any other Loan Document, or any other instrument or document executed and delivered by any Grantor to Secured Party nor any additional Revolving Loans or other loans made by any Lender to Borrower, nor the taking of further security, nor the retaking or re-delivery of the Collateral to Grantors, or any of them, by Secured Party, nor any other act of Lender or the Bank Product Providers, or any of them, shall release any Grantor from any obligation, except a release or discharge executed in writing by Secured Party in accordance with the provisions of the Credit Agreement.  Secured Party shall not by any act, delay, omission or otherwise, be deemed to have waived any of its rights or remedies hereunder, unless such waiver is in writing and signed by Secured Party and then only to the extent therein set forth.  A waiver by Secured Party of any right or remedy on any occasion shall not be construed as a bar to the exercise of any such right or remedy which Secured Party would otherwise have had on any other occasion.

(b)Each Grantor agrees that, if any payment made by any Grantor or other Person and applied to the Secured Obligations is at any time annulled, avoided, set, aside, rescinded, invalidated, declared to be fraudulent or preferential or otherwise required to be refunded or repaid, or the proceeds of any Collateral are required to be returned by Secured Party or Lender to such Grantor, its estate, trustee, receiver or any other party, including any Grantor, under any bankruptcy law, state or federal law, common law or equitable cause, then, to the extent of such payment or repayment, any Lien or other Collateral securing such liability shall be and remain in full force and effect, as fully as if such payment had never been made. If, prior to any of the foregoing, (i) any Lien or other Collateral securing such Grantor's liability hereunder shall have been released or terminated by virtue of the foregoing clause (a), or (ii) any provision of the Guaranty hereunder shall have been terminated, cancelled or surrendered, such Lien, other Collateral or provision shall be reinstated in full force and effect and such prior release, termination, cancellation or surrender shall not diminish, release, discharge, impair or otherwise affect the obligations of any such Grantor in respect of any Lien or other Collateral securing such obligation or the amount of such payment.

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24.Survival.  All representations and warranties made by the Grantors in this Agreement and in the certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that Secured Party, Issuing Lender, or any Lender may have had notice or knowledge of any Default or Event of Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any loan or any fee or any other amount payable under the Credit Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not expired or terminated.

25.CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER; JUDICIAL REFERENCE PROVISION.

(a)THE VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF, THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO, AND ANY CLAIMS, CONTROVERSIES OR DISPUTES ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

(b)THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN, STATE OF NEW YORK; PROVIDED, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT SECURED PARTY'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SECURED PARTY ELECTS TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.  EACH GRANTOR AND SECURED PARTY WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 25(b).

(c)TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH GRANTOR AND SECURED PARTY HEREBY WAIVE THEIR RESPECTIVE RIGHTS, IF ANY, TO A JURY TRIAL OF ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION DIRECTLY OR INDIRECTLY BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS (EACH A "CLAIM").  EACH GRANTOR AND SECURED PARTY REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.  IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

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(d)EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS  LOCATED IN THE BOROUGH OF MANHATTAN AND THE STATE OF NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT.  EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AGAINST ANY GRANTOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(e)NO CLAIM MAY BE MADE BY ANY GRANTOR AGAINST THE SECURED PARTY, THE SWING LENDER, ANY OTHER LENDER, ISSUING LENDER, OR THE UNDERLYING ISSUER, OR ANY AFFILIATE, DIRECTOR, OFFICER, EMPLOYEE, COUNSEL, REPRESENTATIVE, SECURED PARTY, OR ATTORNEY-IN-FACT OF ANY OF THEM FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, OR PUNITIVE DAMAGES IN RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, OR ANY ACT, OMISSION, OR EVENT OCCURRING IN CONNECTION HEREWITH, AND EACH GRANTOR HEREBY WAIVES, RELEASES, AND AGREES NOT TO SUE UPON ANY CLAIM FOR SUCH DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.

(f)IN THE EVENT ANY LEGAL PROCEEDING IS FILED IN A COURT OF THE STATE OF CALIFORNIA (THE "COURT") BY OR AGAINST ANY PARTY HERETO IN CONNECTION WITH ANY CLAIM AND THE WAIVER SET FORTH IN SECTION 25(c) ABOVE IS NOT ENFORCEABLE IN SUCH PROCEEDING, THE PARTIES HERETO AGREE AS FOLLOWS:

(i)WITH THE EXCEPTION OF THE MATTERS SPECIFIED IN SUBCLAUSE (ii) BELOW, ANY CLAIM SHALL BE DETERMINED BY A GENERAL REFERENCE PROCEEDING IN ACCORDANCE WITH THE PROVISIONS OF CALIFORNIA CODE OF CIVIL PROCEDURE SECTIONS 638 THROUGH 645.1.  THE PARTIES INTEND THIS GENERAL REFERENCE AGREEMENT TO BE SPECIFICALLY ENFORCEABLE.  VENUE FOR THE REFERENCE PROCEEDING SHALL BE IN THE COUNTY OF LOS ANGELES, CALIFORNIA.

(ii)THE FOLLOWING MATTERS SHALL NOT BE SUBJECT TO A GENERAL REFERENCE PROCEEDING:  (A) NON-JUDICIAL FORECLOSURE OF ANY SECURITY INTERESTS IN REAL OR PERSONAL PROPERTY, (B) EXERCISE OF SELF-HELP REMEDIES (INCLUDING SET-OFF OR RECOUPMENT), (C) APPOINTMENT OF A RECEIVER, AND (D) TEMPORARY, PROVISIONAL, OR ANCILLARY REMEDIES (INCLUDING WRITS OF ATTACHMENT, WRITS OF POSSESSION, TEMPORARY RESTRAINING ORDERS, OR PRELIMINARY INJUNCTIONS).  THIS AGREEMENT DOES NOT LIMIT THE RIGHT OF ANY PARTY TO EXERCISE OR OPPOSE ANY OF THE RIGHTS AND REMEDIES DESCRIBED IN CLAUSES (A) - (D) AND ANY SUCH EXERCISE OR OPPOSITION DOES NOT WAIVE THE RIGHT OF ANY PARTY TO PARTICIPATE IN A REFERENCE PROCEEDING PURSUANT TO THIS AGREEMENT WITH RESPECT TO ANY OTHER MATTER.

-34-

 

(iii)UPON THE WRITTEN REQUEST OF ANY PARTY, THE PARTIES SHALL SELECT A SINGLE REFEREE, WHO SHALL BE A RETIRED JUDGE OR JUSTICE.  IF THE PARTIES DO NOT AGREE UPON A REFEREE WITHIN 10 DAYS OF SUCH WRITTEN REQUEST, THEN, ANY PARTY SHALL HAVE THE RIGHT TO REQUEST THE COURT TO APPOINT A REFEREE PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 640(B).  THE REFEREE SHALL BE APPOINTED TO SIT WITH ALL OF THE POWERS PROVIDED BY LAW.  PENDING APPOINTMENT OF THE REFEREE, THE COURT SHALL HAVE THE POWER TO ISSUE TEMPORARY OR PROVISIONAL REMEDIES.

(iv)EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE REFEREE SHALL DETERMINE THE MANNER IN WHICH THE REFERENCE PROCEEDING IS CONDUCTED INCLUDING THE TIME AND PLACE OF HEARINGS, THE ORDER OF PRESENTATION OF EVIDENCE, AND ALL OTHER QUESTIONS THAT ARISE WITH RESPECT TO THE COURSE OF THE REFERENCE PROCEEDING.  ALL PROCEEDINGS AND HEARINGS CONDUCTED BEFORE THE REFEREE, EXCEPT FOR TRIAL, SHALL BE CONDUCTED WITHOUT A COURT REPORTER, EXCEPT WHEN ANY PARTY SO REQUESTS A COURT REPORTER AND A TRANSCRIPT IS ORDERED, A COURT REPORTER SHALL BE USED AND THE REFEREE SHALL BE PROVIDED A COURTESY COPY OF THE TRANSCRIPT.  THE PARTY MAKING SUCH REQUEST SHALL HAVE THE OBLIGATION TO ARRANGE FOR AND PAY THE COSTS OF THE COURT REPORTER, PROVIDED THAT SUCH COSTS, ALONG WITH THE REFEREE'S FEES, SHALL ULTIMATELY BE BORNE BY THE PARTY WHO DOES NOT PREVAIL, AS DETERMINED BY THE REFEREE.

(v)THE REFEREE MAY REQUIRE ONE OR MORE PREHEARING CONFERENCES.  THE PARTIES HERETO SHALL BE ENTITLED TO DISCOVERY, AND THE REFEREE SHALL OVERSEE DISCOVERY IN ACCORDANCE WITH THE RULES OF DISCOVERY, AND SHALL ENFORCE ALL DISCOVERY ORDERS IN THE SAME MANNER AS ANY TRIAL COURT JUDGE IN PROCEEDINGS AT LAW IN THE STATE OF CALIFORNIA.

(vi)THE REFEREE SHALL APPLY THE RULES OF EVIDENCE APPLICABLE TO PROCEEDINGS AT LAW IN THE STATE OF CALIFORNIA AND SHALL DETERMINE ALL ISSUES IN ACCORDANCE WITH CALIFORNIA SUBSTANTIVE AND PROCEDURAL LAW.  THE REFEREE SHALL BE EMPOWERED TO ENTER EQUITABLE AS WELL AS LEGAL RELIEF AND RULE ON ANY MOTION WHICH WOULD BE AUTHORIZED IN A TRIAL, INCLUDING MOTIONS FOR DEFAULT JUDGMENT OR SUMMARY JUDGMENT.  THE REFEREE SHALL REPORT HIS OR HER DECISION, WHICH REPORT SHALL ALSO INCLUDE FINDINGS OF FACT AND CONCLUSIONS OF LAW.  THE REFEREE SHALL ISSUE A DECISION AND PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE, SECTION 644, THE REFEREE'S DECISION SHALL BE ENTERED BY THE COURT AS A JUDGMENT IN THE SAME MANNER AS IF THE ACTION HAD BEEN TRIED BY THE COURT.  THE FINAL JUDGMENT OR ORDER FROM ANY APPEALABLE DECISION OR ORDER ENTERED BY THE REFEREE SHALL BE FULLY APPEALABLE AS IF IT HAS BEEN ENTERED BY THE COURT.

-35-

 

(vii)THE PARTIES RECOGNIZE AND AGREE THAT ALL CLAIMS RESOLVED IN A GENERAL REFERENCE PROCEEDING PURSUANT HERETO WILL BE DECIDED BY A REFEREE AND NOT BY A JURY.  AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR OWN CHOICE, EACH PARTY HERETO KNOWINGLY AND VOLUNTARILY AND FOR THEIR MUTUAL BENEFIT AGREES THAT THIS REFERENCE PROVISION SHALL APPLY TO ANY DISPUTE BETWEEN THEM THAT ARISES OUT OF OR IS RELATED TO THIS AGREEMENT.

26.New Subsidiaries.  Pursuant to Section 5.11 of the Credit Agreement, certain Subsidiaries (whether by acquisition or creation) of any Grantor are required to enter into this Agreement by executing and delivering in favor of Secured Party a Joinder to this Agreement in substantially the form of Annex 1.  Upon the execution and delivery of Annex 1 by any such new Subsidiary, such Subsidiary shall become a Guarantor and Grantor hereunder with the same force and effect as if originally named as a Guarantor and Grantor herein.  The execution and delivery of any instrument adding an additional Guarantor or Grantor as a party to this Agreement shall not require the consent of any Guarantor or Grantor hereunder.  The rights and obligations of each Guarantor and Grantor hereunder shall remain in full force and effect notwithstanding the addition of any new Guarantor or Grantor hereunder.

27.Secured Party.  Each reference herein to any right granted to, benefit conferred upon or power exercisable by the "Secured Party" shall be a reference to Secured Party, for the benefit of itself, as Lender, and each of the Bank Product Providers.

28.FCC Authorizations; Related Collateral.  

(a)Secured Party's rights hereunder (and the rights of any receiver appointed by reason of the exercise of remedies hereunder) with respect to the FCC Authorizations and any Collateral subject to such FCC Authorizations, as applicable, are expressly subject to Communications Laws.

(b)Notwithstanding anything to the contrary contained in this Agreement, but without waiving or limiting any obligations of any Grantor hereunder, neither Secured Party nor any receiver appointed by reason of the exercise of remedies hereunder shall control, supervise, direct, or manage the business of any Grantor, in each case to the extent any assignment of any FCC Authorization or a direct or indirect transfer of control of any Grantor, or any FCC Authorization, whether de jure or de facto, if such assignment or such direct or indirect transfer of control would require, under the Communications Laws, the prior approval of the FCC without first obtaining such approval.

(c)Each Grantor agrees to take any lawful action with respect to requesting and obtaining any approvals from any Governmental Authority that may be required by law which the Secured Party may reasonably request in order to obtain and enjoy the full rights and benefits granted to the Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, by this Agreement, including, specifically, after the occurrence and during the continuance of any Event of Default and an exercise of the Secured Party's remedies hereunder, such Grantor's full cooperation in lawfully obtaining any approval of the FCC and of any other Governmental Authority that is then required under the Communications Laws or any other Law for the exercise of the Secured Party's remedies under this Agreement.

-36-

 

29.Miscellaneous.

(a)This Agreement is a Loan Document.  This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement.  Delivery of an executed counterpart of this Agreement by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Agreement.  Any party delivering an executed counterpart of this Agreement by telefacsimile or other electronic method of transmission also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement.  The foregoing shall apply to each other Loan Document mutatis mutandis.

(b)Any provision of this Agreement which is prohibited or unenforceable shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof in that jurisdiction or affecting the validity or enforceability of such provision in any other jurisdiction.  Each provision of this Agreement shall be severable from every other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision.

(c)Headings and numbers have been set forth herein for convenience only.  Unless the contrary is compelled by the context, everything contained in each Section applies equally to this entire Agreement.

(d)Neither this Agreement nor any uncertainty or ambiguity herein shall be construed against Lender or any Grantor, whether under any rule of construction or otherwise.  This Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to accomplish fairly the purposes and intentions of all parties hereto.

[Signature pages follow]

 

 

 

-37-

 

IN WITNESS WHEREOF, the undersigned parties hereto have caused this Agreement to be executed and delivered as of the day and year first above written.

 

	
GRANTORS:
	
EMMIS COMMUNICATIONS CORPORATION

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
EMMIS OPERATING COMPANY

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
EMMIS INDIANA BROADCASTING, L.P.

	
 
	
 
	
 
	
 

	
   
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
EMMIS LICENSE CORPORATION OF

NEW YORK

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
EMMIS PUBLISHING CORPORATION

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
EMMIS PUBLISHING, L.P.

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

Signature Page to Guaranty and Security Agreement

 

 

	
 
	
 
	
 
	
 

	
 
	
EMMIS RADIO LICENSE CORPORATION

OF NEW YORK

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

 

	
 
	
EMMIS RADIO LICENSE, LLC

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
EMMIS RADIO, LLC

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
WBLS-WLIB LICENSE, LLC

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
WBLS-WLIB, LLC

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

	
 
	
WHHL, LLC

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

Signature Page to Guaranty and Security Agreement

 

	
 
	
WLIB Tower LLC

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ J. Scott Enright

	
 
	
Name:
	
 
	
J. Scott Enright

	
 
	
Title:
	
 
	
Executive Vice President, General Counsel and Secretary

	
 
	
 
	
 
	
 

 

	
SECURED PARTY:
	
WELLS FARGO BANK, NATIONAL

ASSOCIATION, a national banking association

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
/s/ Victor Panasci

	
 
	
Name:
	
 
	
Victor Panasci

	
 
	
Title:
	
 
	
Authorized Signatory

 

 

Signature Page to Guaranty and Security Agreement

 

SCHEDULE 1

 

[Reserved]

 

 

 

SCHEDULE 2

 

[Reserved]

 

 

 

SCHEDULE 3

 

[Reserved]

 

 

 

SCHEDULE 4

 

[Reserved]

 

 

 

SCHEDULE 5

 

PLEDGED COMPANIES

 

							
	
Name of Grantor
	
Name of Pledged Company
	
Number of Shares/Units
	
Class of Interests
	
Percentage of Shares/Units Owned
	
Percentage of Shares/Units Pledged
	
Certificate Nos.

	
Emmis Operating Company
	
Emmis Radio License, LLC
	
N/A
	
N/A
	
100%
	
100%
	
Uncertificated

 

 

 

SCHEDULE 6

 

[Reserved]

 

 

 

SCHEDULE 7

 

NAME; CHIEF EXECUTIVE OFFICE; TAX IDENTIFICATION NUMBERS AND ORGANIZATIONAL NUMBERS

 

 

 

SCHEDULE 8

 

[Reserved]

 

 

SCHEDULE 9

 

DEPOSIT ACCOUNTS AND SECURITIES ACCOUNTS

 

 

 

SCHEDULE 10

 

CONTROLLED ACCOUNT BANKS

 

 

 

SCHEDULE 11

 

LIST OF UNIFORM COMMERCIAL CODE FILING JURISDICTIONS

 

	
Grantor
	
Jurisdictions

	
 
	
 

 

 

 

 

 

ANNEX 1 TO GUARANTY AND SECURITY AGREEMENT

FORM OF JOINDER

 

Joinder No. ____ (this "Joinder"), dated as of ____________ 20___, to the Guaranty and Security Agreement, dated as of April [__], 2019 (as amended, restated, supplemented, or otherwise modified from time to time, the "Guaranty and Security Agreement"), by and among each of the parties listed on the signature pages thereto and those additional entities that thereafter become parties thereto (collectively, jointly and severally, "Grantors" and each, individually, a "Grantor") and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association ("Wells Fargo"), in its capacity as Secured Party for itself, as Lender, and the Bank Product Providers (in such capacity, together with its successors and assigns in such capacity, "Secured Party").

W I T N E S S E T H:

WHEREAS, pursuant to that certain Credit Agreement of even date herewith (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement") by and among EMMIS COMMUNICATIONS CORPORATION, an Indiana corporation ("Parent"), EMMIS OPERATING COMPANY, an Indiana corporation ("Emmis"), the other entities from time to time party thereto as "Borrowers" (together with Emmis, collectively, "Borrowers", and each a "Borrower"), Wells Fargo, as lender ("Lender"), Lender has agreed to make certain financial accommodations available to Borrower from time to time pursuant to the terms and conditions thereof; and

WHEREAS, initially capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Guaranty and Security Agreement or, if not defined therein, in the Credit Agreement, and this Joinder shall be subject to the rules of construction set forth in Section 1(b) of the Guaranty and Security Agreement, which rules of construction are incorporated herein by this reference, mutatis mutandis; and

WHEREAS, Grantors have entered into the Guaranty and Security Agreement in order to induce Lender and the Bank Product Providers to make certain financial accommodations to Borrower as provided for in the Credit Agreement, the other Loan Documents, and the Bank Product Agreements; and

WHEREAS, pursuant to Section 5.11 of the Credit Agreement and Section 26 of the Guaranty and Security Agreement, certain Subsidiaries of the Loan Parties, must execute and deliver certain Loan Documents, including the Guarantor and Security Agreement, and the joinder to the Guaranty and Security Agreement by the undersigned new Grantor or Grantors (collectively, the "New Grantors") may be accomplished by the execution of this Joinder in favor of Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers; and

WHEREAS, each New Grantor (a) is [an Affiliate] [a Subsidiary] of Borrower and, as such, will benefit by virtue of the financial accommodations extended to Borrower by Lender or the Bank Product Providers and (b) by becoming a Grantor will benefit from certain rights granted to the Grantors pursuant to the terms of the Loan Documents and the Bank Product Agreements;

Annex I - 1

 

NOW, THEREFORE, for and in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each New Grantor hereby agrees as follows:

1.In accordance with Section 26 of the Guaranty and Security Agreement, each New Grantor, by its signature below, becomes a "Grantor" and "Guarantor" under the Guaranty and Security Agreement with the same force and effect as if originally named therein as a "Grantor" and "Guarantor" and each New Grantor hereby (a) agrees to all of the terms and provisions of the Guaranty and Security Agreement applicable to it as a "Grantor" or "Guarantor" thereunder and (b) represents and warrants that the representations and warranties made by it as a "Grantor" or "Guarantor" thereunder are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that are already qualified or modified by materiality in the text thereof) on and as of the date hereof.  In furtherance of the foregoing, each New Grantor hereby (a) jointly and severally unconditionally and irrevocably guarantees as a primary obligor and not merely as a surety the full and prompt payment when due, whether upon maturity, acceleration, or otherwise, of all of the Guarantied Obligations, and (b) unconditionally grants, assigns, and pledges to Secured Party, for the benefit of itself, as Lender, and the Bank Product Providers, to secure the Secured Obligations, a continuing security interest in and to all of such New Grantor's right, title and interest in and to the Collateral.  Each reference to a "Grantor" or "Guarantor" in the Guaranty and Security Agreement shall be deemed to include each New Grantor.  The Guaranty and Security Agreement is incorporated herein by reference.

2.Schedule 5, "Pledged Companies", Schedule 7, Name; Chief Executive Office; Tax Identification Numbers and Organizational Numbers, Schedule 8, "Deposit Accounts and Securities Accounts", Schedule 10, "Controlled Account Banks", and Schedule 11, "List of Uniform Commercial Code Filing Jurisdictions", attached hereto supplement Schedule 5, Schedule 7, Schedule 8, Schedule 10, and Schedule 11 respectively, to the Guaranty and Security Agreement and shall be deemed a part thereof for all purposes of the Guaranty and Security Agreement.

3.Each New Grantor authorizes Secured Party at any time and from time to time to file, transmit, or communicate, as applicable, financing statements and amendments thereto (i) describing the Collateral as "all personal property of debtor" or "all assets of debtor" or words of similar effect, (ii) describing the Collateral as being of equal or lesser scope or with greater detail, or (iii) that contain any information required by part 5 of Article 9 of the Code for the sufficiency or filing office acceptance.  Each New Grantor also hereby ratifies any and all financing statements or amendments previously filed by Secured Party in any jurisdiction in connection with the Loan Documents.

4.Each New Grantor represents and warrants to Secured Party, Lender and the Bank Product Providers that this Joinder has been duly executed and delivered by such New Grantor and constitutes its legal, valid, and binding obligation, enforceable against it in accordance with its terms, except as enforceability thereof may be limited by bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium, or other similar laws affecting creditors' rights generally and general principles of equity (regardless of whether such enforceability is considered in a proceeding at law or in equity).

Annex I - 2

 

5.This Joinder is a Loan Document.  This Joinder may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Joinder.  Delivery of an executed counterpart of this Joinder by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Joinder.  Any party delivering an executed counterpart of this Joinder by telefacsimile or other electronic method of transmission also shall deliver an original executed counterpart of this Joinder but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Joinder.

6.The Guaranty and Security Agreement, as supplemented hereby, shall remain in full force and effect.

7.THIS JOINDER SHALL BE SUBJECT TO THE PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN SECTION 25 OF THE SECURITY AGREEMENT, AND SUCH PROVISIONS ARE INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

Annex I - 3

 

IN WITNESS WHEREOF, the parties hereto have caused this Joinder to the Guaranty and Security Agreement to be executed and delivered as of the day and year first above written.

 

	
NEW GRANTORS:
	
[NAME OF NEW GRANTOR]

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
 

	
 
	
Name:
	
 
	
 

	
 
	
Title:
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
[NAME OF NEW GRANTOR]

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
 

	
 
	
Name:
	
 
	
 

	
 
	
Title:
	
 
	
 

	
 
	
 
	
 
	
 

	
SECURED PARTY:
	
WELLS FARGO BANK, National

Association, a national banking association

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
 

	
 
	
Name:
	
 
	
 

	
 
	
 
	
 
	
Its Authorized Signatory

 

 

 

[SIGNATURE PAGE TO JOINDER NO. ___ TO GUARANTY AND SECURITY AGREEMENT]

 

EXHIBIT A

Equipment Schedule

 

 

 

 

EXHIBIT B

[Reserved]

 

 

 

 

EXHIBIT C

PLEDGED INTERESTS ADDENDUM

 

This Pledged Interests Addendum, dated as of _________ __, 20___ (this "Pledged Interests Addendum"), is delivered pursuant to Section 7 of the Guaranty and Security Agreement referred to below.  The undersigned hereby agrees that this Pledged Interests Addendum may be attached to that certain Guaranty and Security Agreement, dated as of April [__], 2019, (as amended, restated, supplemented, or otherwise modified from time to time, the "Guaranty and Security Agreement"), made by the undersigned, together with the other Grantors named therein, to WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as Secured Party.  Initially capitalized terms used but not defined herein shall have the meaning ascribed to such terms in the Guaranty and Security Agreement or, if not defined therein, in the Credit Agreement, and this Pledged Interests Addendum shall be subject to the rules of construction set forth in Section 1(b) of the Guaranty and Security Agreement, which rules of construction are incorporated herein by this reference, mutatis mutandis.  The undersigned hereby agrees that the additional interests listed on Schedule I shall be and become part of the Pledged Interests pledged by the undersigned to Secured Party in the Guaranty and Security Agreement and any pledged company set forth on Schedule I shall be and become a "Pledged Company" under the Guaranty and Security Agreement, each with the same force and effect as if originally named therein.

This Pledged interests Addendum is a Loan Document.  Delivery of an executed counterpart of this Pledged Interests Addendum by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Pledged Interests Addendum.  If the undersigned delivers an executed counterpart of this Pledged Interests Addendum by telefacsimile or other electronic method of transmission, the undersigned shall also deliver an original executed counterpart of this Pledged Interests Addendum but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Pledged Interests Addendum.

The undersigned hereby certifies that the representations and warranties set forth in Section 6 of the Guaranty and Security Agreement of the undersigned are true and correct as to the Pledged Interests listed herein on and as of the date hereof.

THIS PLEDGED INTERESTS ADDENDUM SHALL BE SUBJECT TO THE PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN SECTION 25 OF THE SECURITY AGREEMENT, AND SUCH PROVISIONS ARE INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.

 

[signature page follows]

 

 

 

IN WITNESS WHEREOF, the undersigned has caused this Pledged Interests Addendum to be executed and delivered as of the day and year first above written.

 

	
 
	
 
	
 

	
By:
	
 
	
 

	
Name:
	
 
	
 

	
Title:
	
 
	
 

 

 

 

-2-

 

SCHEDULE I

to

PLEDGED INTERESTS ADDENDUM

Pledged Interests

 

	
Name of

Grantor
	
Name of Pledged

Company
	
Number of

Shares/Units
	
Class of

Interests
	
Percentage of

Class Owned
	
Certificate

Nos.

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 

 

 

 

 

EXHIBIT D

[Reserved]emms-ex103_8.htm

 

Exhibit 10.3

LOAN AGREEMENT

 

THIS LOAN AGREEMENT (the “Agreement”), made and entered effective as of the 12th day of April, 2019, by and between EMMIS OPERATING COMPANY, an Indiana corporation (“EOC”), and Emmis Indiana Broadcasting, L.P., an Indiana limited partnership (“EIB”), each having a mailing address of 40 Monument Circle, Suite 700, Indianapolis, Indiana 46204 (hereinafter referred to collectively as “Borrower”), and STAR FINANCIAL BANK, having an office at 3610 River Crossing Parkway, Indianapolis, Indiana 46240 (hereinafter referred to as “Lender”), 

WITNESSETH:

WHEREAS, EOC is the owner of fee simple title to certain real estate and improvements located in Marion County, Indiana, more particularly described in Exhibit “A” attached hereto and by reference made a part of this Agreement (the “EOC Real Estate”);

WHEREAS, EIB is the owner of fee simple title to certain real estate and improvements located in Boone County, Indiana, more particularly described in Exhibit “B” attached hereto and by reference made a part of this Agreement (the “EIB Real Estate”) (the EOC Real Estate and EIB Real Estate are sometimes hereinafter referred to collectively as the “Real Estate”); and

WHEREAS, Borrower has applied to Lender for a loan against the Real Estate in the maximum principal amount of Twenty Three Million Dollars ($23,000,000.00), and Lender is willing to make such loan to Borrower against the Real Estate in full compliance with the terms and conditions hereinafter contained.

NOW, THEREFORE, in consideration of these premises and the undertakings of the parties hereto, Borrower and Lender hereby agree as follows:

1.Loan. 

Subject to the terms and conditions of this Agreement, Lender shall establish for Borrower a term loan in the maximum principal amount of Twenty Three Million Dollars ($23,000,000.00) (the “Loan”). The Loan shall be payable in the manner specified in the Promissory Note of Borrower payable to the order of Lender in the principal sum of Twenty Three Million Dollars ($23,000,000.00) (such promissory note as may be modified or amended from time to time and/or any promissory note which is a direct or remote renewal, extension, restatement or replacement of such promissory note is hereinafter referred to as the “Note”) and have a maturity date of April 12, 2029. 

2.Collateral. 

A.The indebtedness and obligations of Borrower to Lender under the Loan shall be secured by: (a) the lien of a first mortgage covering the Real Estate, a first assignment of all rents and leases with respect to the Real Estate and a first assignment of agreements with respect to the Real Estate granted under the terms of two (2) Mortgages executed by each Borrower as to its 

10430483v4 4/11/2019 3:44 PM1989.647

 

interest in the Real Estate to Lender of even date herewith (such Mortgage(s) as may be modified or amended from time to time is hereinafter referred to collectively as the “Mortgage”), (b) a first assignment of all rents and leases with respect to the Real Estate and Improvements granted under the terms of two Assignments of Leases executed by Borrower as to its interest in the Real Estate to Lender of even date herewith (such Assignment(s) as may be modified or amended from time to time is hereinafter referred to collectively as the “Assignment of Leases”), (c) an assignment of contracts and agreements relating to the Real Estate, all granted under the terms of two (2) Assignment Agreements executed by Borrower as to its interest in the Real Estate in favor of Lender of even date herewith (such Assignment Agreement(s) as may be modified or amended from time to time is hereinafter referred to collectively as the “Assignment Agreement”), and (d) two (2) Environmental Indemnity Agreements executed or to be executed by Borrower as to its interest in the Real Estate, and (such Environmental Indemnity Agreement(s) as may be modified or amended from time to time is hereinafter referred to collectively as the “Indemnity Agreement”).

The Note, Mortgage, Assignment of Leases, Assignment Agreement, Indemnity Agreement, and all other documents in connection with the Loan shall be collectively the “Loan Documents” and the terms and conditions thereof are hereby incorporated by reference and made a part of this Agreement.

3.Conditions Precedent to Advancement of the Loan. 

A.Each of the following conditions shall be a condition precedent to the advancement of any part of the Loan by Lender pursuant to this Agreement. 

i.Borrower shall execute and deliver the Note, Mortgage, Indemnity Agreement, Assignment of Leases and Assignment Agreement to Lender.

 

ii.Borrower has furnished to Lender commitments for a mortgagee’s policy of title insurance in an amount equal to the Loan issued by a title insurance company acceptable to Lender, insuring to Lender the title of Borrower to the Real Estate, together with any easements for parking and ingress and egress which benefit the Real Estate, free and clear of all liens, claims, encumbrances, easements, encroachments and defects, except for the lien of current real estate taxes not delinquent and other restrictions of record reasonably acceptable to Lender (“Permitted Encumbrances”). Such commitment(s) shall contain such special coverage endorsements as Lender may reasonably require, including, but not limited to, ALTA 3.1 zoning, ALTA 25 survey, ALTA 17 access and ALTA 9.2 comprehensive. Upon request by Lender, Borrower shall deliver to Lender satisfactory evidence from such title company acknowledging payment in full for all premiums, costs and expenses for issuance of such binder and the final policy of insurance to be issued pursuant thereto and the filing of financing statements pursuant to the Mortgage which shows the Mortgage as a first lien upon the Real Estate subject to the above conditions and the security interest pursuant to the Mortgage as having first priority, and to issue, upon demand by Lender, a final mortgagee’s policy of title insurance in standard form with only exceptions reasonably satisfactory to Lender which insures the Mortgage and the security interest granted pursuant to the Mortgage.

 

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iii.Borrower has delivered to Lender a survey of the Real Estate (the “Existing Survey”).

 

iv.Borrower shall furnish to Lender evidence of hazard insurance coverage for the improvements on the Real Estate (all risk coverage), with a standard mortgage endorsement and loss payee endorsement in favor of Lender, and public liability insurance with Lender named as an additional insured, with copies of endorsements to the policies, all in such amounts and in form consistent with sound business practices.

 

v.Lender shall have determined that the Real Estate is not located in a flood hazard area as defined under the Flood Disaster Protection Act of 1973 and the National Flood Insurance Act of 1968.  If the Real Estate is in a flood hazard area under the foregoing sentence, Borrower shall furnish to Lender evidence of flood insurance coverage, with a standard mortgagee endorsement in favor of Lender, such insurance to be with a company and in an amount reasonably acceptable to Lender.

 

vi.Borrower shall furnish or cause to be furnished to Lender corporate resolutions of the board of directors of EOC authorizing it to obtain the Loan and partner resolutions of the partners of EIB authorizing it to obtain the Loan, and the execution and delivery of all documents and instruments in connection therewith. 

 

vii.Borrower shall furnish or cause to be furnished to Lender a copy of the Articles of Incorporation and Bylaws of EOC and articles of limited partnership and partnership agreement of EIB and all amendments thereto. 

 

viii.Borrower shall furnish or cause to be furnished to Lender a certificate of existence for Borrower issued by the Office of the Secretary of State of Indiana. 

 

ix.Borrower shall furnish or cause to be furnished to Lender an opinion of Borrower’s counsel for the State of Indiana which is reasonably acceptable to Lender and Lender’s counsel.

 

xi.Borrower has furnished to Lender environmental inspection reports of the Real Estate prepared by August Mack dated March 21, 2019 (the “Environmental Report”).

 

xii.Lender has obtained appraisals of the Real Estate and Improvements, stating the “as-is” collective value of the Real Estate and Improvements is not less than Thirty Million Six Hundred Sixty-Six Thousand Six Hundred Sixty-Seven Dollars ($30,666,667.00).

 

xiii.The warranties and representations set forth in paragraph 5 of this Agreement shall be and remain true and that there has been full compliance with the covenants set forth in paragraph 6 of this Agreement.

 

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xiv.Borrower shall execute and deliver to Lender such other documents, instruments, information and materials as may be reasonably required by Lender in connection with the Loan.

 

4.Duties of Borrower.

A.In addition to all of the terms and conditions to be performed by Borrower under this Agreement, Borrower shall pay to Lender at the time of the execution of this Agreement, if Borrower has not previously paid, the balance of a commitment and service fee of One Hundred Fifteen Thousand Dollars ($115,000.00) and shall reimburse Lender for all costs and expenses incurred by it in connection with the Loan, including but not limited to premiums and fees of title insurance companies, recording fees, lien search fees, survey expenses, appraisal fees and reasonable legal fees and expenses of its counsel, all of which may be deducted by Lender from the advancements made hereunder, and shall deliver to Lender such other documents as it may reasonably require to carry out the terms and provisions of this Agreement. 

B.Borrower shall pay Lender a “Mandatory Principal Payment” of not less than Ten Million Dollars ($10,000,000.00) from (i) 100% of the Net Proceeds of any sale of all or a portion of the EIB Real Estate; and/or (ii) twenty-five percent (25%) of the Net Proceeds of any other sales of magazines or radio stations by Borrower or its included subsidiaries listed on Exhibit C (the “Asset Sales”).  “Net Proceeds” for the sale of the EIB Property shall be the gross proceeds from the sale of the EIB Property less reasonable and customary expenses for the sale of real estate including, real estate commissions, customary due diligence costs and the cost of relocating the existing towers on the EIB Property. “Net Proceeds” for Asset Sales shall be the gross proceeds due Borrower from Asset Sales less (a) reasonable and customary expenses for the sale of similar type assets; provided further that Net Proceeds from the sale of any assets or ownership interests in Emmis Austin Radio Broadcasting Company, L.P. or Radio Austin Management, LLC (collectively “Austin”) shall be used first to repay the loan from Barrett Investment Partners, LLC (“Barrett Loan”) in the principal amount of not more than Four Million Dollars ($4,000,000.00). Notwithstanding the foregoing, Lender shall release the Mortgage on the EIB Property upon (i) receipt of Net Proceeds from sale(s) of all or any portion of the EIB Property totaling $6,800,000.00; or (ii) receipt of Net Proceeds of Asset Sales, including any Net Proceeds from the sales of all or any portion of the EIB Property, totaling no less than $10,000,000.00.  If less than all of the EIB Property is sold, Lender shall partially release the Mortgage in the EIB Property for such portions of the EIB Property being sold if the purchase price per acre exceeds One Hundred Fifty Thousand Dollars ($150,000.00).

5.Warranties and Representations.  Borrower warrants and represents to Lender that: 

a.EOC is a corporation duly organized and in existence under the laws of the State of Indiana, and has full power and authority under its Articles of Incorporation and By-laws, and any amendments thereto, and under all applicable provisions of law to own and operate its business and the EOC Real Estate;

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b.EIB is a limited partnership duly organized and in existence under the laws of the State of Indiana and has full power and authority under its Articles of Limited Partnership and Limited Partnership Agreement and any amendments thereto, and under all applicable provisions of law to own and operate its business and the EIB Real Estate; 

 

c.EOC is the owner in fee simple of the EOC Real Estate subject only to the Permitted Encumbrances, a future rooftop license agreement EOC is negotiating and anticipates entering into with the City of Indianapolis and an agreement with Hokanson Companies, Inc. related to leasing commissions for leasing of a portion of the EOC Real Estate;

 

d.EIB is the owner in fee simple of the EIB Real Estate subject only to the Permitted Encumbrances and that certain Purchase and Sale Agreement between EIB and that certain Purchase and Sale Agreement between EIB and Community Reinvestment Foundation, Inc. dated December 28, 2018 as amended by a First Amendment to Purchase and Sale Agreement dated March 28, 2019; that certain Listing Agreement between EIB and Cushman Wakefield dated November 10, 2017, and that certain Clear Channel Outdoor Lease Agreement between EIB’s predecessor and Clear Channel Outdoor, Inc. dated October 1, 2007, copies of which have been provided to Lender.  Lender hereby acknowledges and agrees that EIB is actively marketing the EIB Real Estate and has engaged Cushman Wakefield as its real estate broker;

 

e.The Real Estate and Improvements are in compliance in all material respects with all applicable building codes, zoning ordinances and the requirements of regulatory agencies having jurisdiction;

 

f.All required federal, state and other tax returns have been filed by or on behalf of Borrower and the taxes in connection therewith paid to date and no additional taxes or assessments have been asserted or are anticipated;

 

g.There is no litigation, or proceeding pending or, to the knowledge of Borrower, threatened against or otherwise affecting Borrower, or any of its respective shareholders, officers, directors or partners, the Real Estate, or any of the other properties or assets owned by them or any of their affiliates or subsidiaries, before any court or before or by any governmental agency, which if adversely determined, would have a material adverse effect on the Loan or the ability of Borrower to perform its respective obligations under this Agreement and the Loan Documents;

 

h.None of the representations or warranties of Borrower set forth in this Agreement or in any document or certificate taken together with any related document or certificate furnished pursuant to this Agreement or in connection with the transactions contemplated hereby contains or will contain any untrue statements of a material fact or omits or will omit to state a financial fact necessary to make any statement of fact contained herein or therein, in light of the circumstances under which it was made, not misleading;

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i.Upon the execution and delivery of this Agreement and the consummation of any transactions contemplated herein, (i) Borrower will be able to pay its respective debts as they become due, (ii) Borrower will have funds and capital sufficient to carry on its respective business and all businesses in which it is about to engage, and (iii) the assets of Borrower, valued on a fair saleable basis, will be equal to or greater than the sum of all liabilities and contingent liabilities required to be included on Borrower’s balance sheet under GAAP (as defined herein) of Borrower, including for this purpose, unliquidated and disputed claims;

 

j.The execution of this Agreement and all other agreements, instruments and documents executed by Borrower in connection herewith, the consummation of all transactions connected herewith, and the operating of the improvements on the Real Estate, have been duly authorized by all necessary action required on the part of Borrower;

 

k.Borrower has provided true and accurate copies of all documents and agreements relating to EOC and its shareholders and EIB and its partners including agreements related to the Revolver Loan, as defined herein, and there are no other agreements existing between EOC and its shareholders or between EIB and its partners that will be in effect after the date of this Agreement;

 

l.Neither the execution of this Agreement (or the consummation of the transactions contemplated hereby) nor compliance with the terms and provisions hereof or of any agreements, documents and instruments required of Borrower hereunder conflict with, result in a breach of or constitute a default under the terms, conditions or provisions of the Articles of Incorporation or By-Laws of EOC or articles of limited partnership or limited partnership agreement of EIB, or any amendments thereto, any agreement to which Borrower is a party or by which Borrower is bound or any law, regulation, order, writ, injunction or decree of any court or governmental agency or instrumentality having jurisdiction;

 

m.Borrower is in compliance in all material respects with all federal, state and local health, safety, building, zoning, environmental and other statutes, regulations and ordinances;

 

n.Any and all employee pension plans of Borrower are in compliance in all material respects with the terms and provisions of the Employee Retirement Income Security Act of 1974 and all other federal, state and local statutes, regulations and ordinances governing the establishment and administration of pension plans;

 

o.All governmental authorizations, permits, certificates, licenses, filings, registrations, approvals or consents have been obtained, received or made by Borrower for it to lawfully (i) make, execute and deliver this Agreement, (ii) perform all of its obligations under this Agreement, and (iii) operate the Real Estate; and

 

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p.(i) Neither Borrower is now engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any margin stock (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System); (ii) no part of the proceeds of any credit hereunder has been or will be used to purchase or carry any such margin stock or to extend credit to others for the purpose of purchasing or carrying any such margin stock; and (iii) no part of the proceeds of any credit hereunder has been or will be used for any purpose that violates or which is inconsistent with the provisions of Regulations G, U or X of said Board of Governors.

 

Borrower further warrants, represents and covenants that all warranties and representations shall remain true in all material respects so long as Borrower has any liability to Lender hereunder or under or with respect to the Loan or any agreement, instrument or document executed in connection herewith.

6.Covenants of Borrower. Borrower agrees and covenants that so long as Borrower has any liability to Lender hereunder or under or with respect to the Loan or any agreement, instrument or document executed in connection herewith or so long as Lender may be obligated to make any advancement to Borrower, Borrower shall:

a.Retain or apply all receipts from the operation of its business first to the payment of expenses and obligations incurred in the ordinary course of business;

 

b.Promptly pay and discharge all taxes, assessments and governmental charges which may be lawfully levied, assessed or imposed upon it or its properties, or upon its income or profits, and all lawful claims for labor, material and services which, if unpaid, might become a lien or charge against the Real Estate located thereon; provided, however, that Borrower shall have the right to contest in good faith any such tax, assessment, charge, levy or claim by appropriate proceedings without the prior payment thereof unless payment is required to contest or to avoid any tax sale;

 

c.Keep accurate and complete books and records of its business, and maintain the same, together with all valuable papers and records at Borrower’s principal offices;

 

d.Defend, or cause to be defended, at all times any adverse claim by a third party relating to the possession of or any interest in the Real Estate;

 

e.Furnish, or cause to be furnished, to Lender, at Borrower’s expense, the following financial statements and other information of Borrower:

 

(1)As soon as available and in any event on or before May 15 of each year, copies of the audited financial reports consisting of a balance sheet and annual statements of income and surplus accounts for Borrower (“Financial Statement”) as of and for the year then ended certified by a certified public accounting firm and prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods involved in form 

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reasonably acceptable to Lender; provided SEC filed financial statements of Emmis Communications Corporation (“ECC”) are sufficient to satisfy this obligation (and Borrower will have no obligation to provide copies of such SEC filed financial statements) as long as (i) EOC is a wholly owned subsidiary of ECC; and (ii) while the lien exists on the EIB Property, EIB is a wholly owned subsidiary of ECC;

 

(2)Within forty-five (45) days of the end of each quarter, beginning the quarter ending May 31, 2019 a financial statement as and for the fiscal quarter then ended, prepared and certified by an officer of Borrower, prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods involved in form reasonably acceptable to Lender; provided SEC filed financial statements of ECC are sufficient to satisfy this obligation (and Borrower will have no obligation to provide copies of such SEC filed financial statements) as long as EOC is a wholly owned subsidiary of EOC and while the lien exists on the EIB Property, and SEC filed financing statements are sufficient as long as EIB is a wholly owned subsidiary of ECC;

 

(3)Within forty-five (45) days of the end of each fiscal quarter of Borrower, beginning with the quarter ending May 31, 2019 a current compliance certificate in the form attached as Exhibit D certified by an Officer of Borrower; and

 

(4)At such times as Lender may reasonably require, such further information regarding the business affairs and financial conditions of Borrower as Lender may reasonably require.

 

f.Permit any authorized representative of Lender and its attorneys and accountants, after prior reasonable notice to Borrower, to inspect, examine and make copies and extracts of the books of account and records of Borrower at reasonable times during normal business hours;

 

g.Permit any authorized representative of Lender, including but not limited to its attorneys and inspectors, after prior reasonable notice to Borrower, to enter upon and inspect and examine the Real Estate at reasonable times during normal business hours;

 

h.Give prompt written notice to Lender of any process or action taken or pending whereby a third party is asserting a claim against Borrower or any of their assets which, if adversely determined, would have a material adverse effect on the financial condition of Borrower;

 

i.Other than the Revolver Loan or Barrett Loan, pay when due all liabilities, including trade accounts, in accordance with regular terms, except for claims contested in good faith by appropriate proceedings;

 

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j.Maintain the insurance required by this Agreement and, upon request by Lender, furnish to Lender evidence of such insurance coverage and payment of premiums therefor;

 

k.Comply in all material respects with all applicable federal, state and local statutes, regulations and ordinances;

 

l.Indemnify and hold Lender harmless from and against any and all claims, losses, damages, setoffs, counterclaims or expenses (including reasonable attorneys’ fees and costs) which Lender may sustain as a result of the transactions evidenced by this Agreement, excluding any act or omission of Lender, or because of the material breach of or inaccuracy in any of the representations and warranties contained in this Agreement or in any other document executed in connection herewith or in any other written communication of Borrower to Lender in connection with the transactions secured hereby whether or not any such inaccuracy was known by Borrower to be incorrect;

 

m.Indemnify, defend and hold Lender harmless from and against any claim, loss or damage to which Lender is subjected as a result of the presence of any hazardous, contaminated or toxic materials, waste or substances (including but not limited to asbestos, ureaformaldehyde foamed in place insulation, polychlorinated biphenyls, and all materials termed hazardous wastes or hazardous substances as defined in the Solid Waste Disposal Act of 1985, as from time to time amended) or the use, handling, storage, transportation or disposal thereof within or upon the Real Estate, excluding any acts of Lender following Lender’s control and possession of the Real Estate, or violation of the covenants, representations and warranties contained in this Agreement. For purposes hereof “hazardous, contaminated or toxic materials, waste or substances” will include but not be limited to substances defined as “hazardous substances,” “hazardous waste,” “hazardous materials,” or “toxic substances” in the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended, 42 U.S.C. Sec. 9601 et seq. or any similar federal, state or local laws, and/or in the regulations adopted in publications promulgated pursuant to such laws, or as such laws or regulations may be further amended, modified or supplemented; 

 

n.Maintain the financial condition of Borrower at all times at a level such that (i) Borrower would not be rendered insolvent if required to perform under the terms of the documentation evidencing the Loan, and (ii) Borrower’s cash flow is adequate to perform its obligations under the documentation evidencing the Loan and pay all other indebtedness and obligations of Borrower as they become due except any such indebtedness and obligations being contested in good faith and (iii) the assets of Borrower, valued on a fair saleable basis, are equal to or greater than the sum of all liabilities and contingent liabilities required to be included on Borrower’s balance sheet under GAAP;

 

o.Notify Lender immediately in writing of the initiation of any criminal investigation or proceeding initiated by any federal, state or local agency, department, or instrumentality against (i) Borrower or (ii) any employee of the Borrower if in either (i) 

9

 

or (ii), such investigation or proceeding could have a material adverse effect on the financial condition, business operations or assets of Borrowers or result in the Real Estate being seized pursuant to 18 U.S.C. Sec. 1963,21 U.S.C. Sec. 853,21 U.S.C. Sec. 881, 46 U.S.C. App. Sec. 1904, I.C. 34-4-30.1-1 et seq. or any similar federal, state or local law and/or regulation adopted in publications promulgated pursuant to such laws, or as such laws or regulations may be further amended, modified or supplemented;

 

p.Permit Lender to advertise in any medium at Lender’s expense indicating Lender as the lender in such form, size and shape as shall be determined by Lender and reasonably approved by Borrower.

 

q.Permit representatives of Lender to have access upon reasonable advance notice and during regular business hours to Borrower’s premises, facilities and records, including hardware, software and test reports, and to Borrower’s personnel, including systems personnel, all as deemed reasonably necessary or appropriate by Lender and reasonably acceptable to Borrower to review but without interfering with Borrower’s normal business operations.

 

r.Maintain a Fixed Charge Coverage Ratio of not less than 1.10 to 1.0 for each twelve (12) month period, tested each fiscal quarter beginning May 31, 2019 and each fiscal quarter thereafter. The term “Fixed Charge Coverage Ratio” means, with respect to a fiscal year for Borrower and certain subsidiaries described on Exhibit “C” but excluding other subsidiaries described on Exhibit “C”, a ratio, the numerator of which is Borrower’s trailing twelve (12) month net income on a consolidated basis before interest, taxes, depreciation and amortization, noncash compensation, and other non-cash items of income or expense, less the sum of unfunded capital expenditures, divided by the amount of scheduled principal and interest payments for long term debt (having a maturity in excess of one year) payable during said trailing twelve (12) month period, all as determined in accordance with generally accepted accounting principles consistently applied (“GAAP”), but adjusted on a pro forma basis reasonably acceptable to Lender for any asset acquisition or disposition that occurs during the period with items paid for in cash from asset disposition activity carved out after satisfaction of the prepayment fee, if any, under the Note.

 

Borrower shall not, without the prior written consent of Lender:

(1)Create or permit to exist any mortgage, pledge, security interest, title retention device or other encumbrance on any interest of Borrower in the Real Estate, except for (a) any mortgage or security interest held by Lender, (b) the junior lien under the Revolver Loan (defined below) on the EOC Real Estate, and (c) those liens and encumbrances as shall be approved in writing by Lender in its sole discretion provided however, notwithstanding any other provision in this Agreement or in any of the other Loan Documents, Lender’s consent shall not be required for the leasing of portions of the EOC Real Estate for commercially reasonable rents upon commercially reasonable terms;

 

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(2)Except for the sale of the EIB Real Estate as provided in this Agreement and the other Loan Documents, dispose of any of its assets or properties other than in the ordinary course of business for fair value;

 

(3)Except for the permitted limited advances for Digonex Technologies, Inc. (“Digonex”) as provided below, or advances to Austin as permitted under the Revolver Loan with Wells, directly or indirectly make (i) any loan, gift, transfer or advance of cash or other real, personal or intangible property other than distributions from cash flow and in compliance with the terms of this Agreement, or (ii) any transfer of any other benefit or thing of value to any person except for fair value received by Borrower; it is intended that this paragraph prohibit, by way of example and not by way of limitation, any payment by Borrower characterized as a commission or referral fee, and any payments by Borrower characterized as the consideration for a purchase to the extent that such payment is not bona fide or exceeds the real value received by the Borrower;

 

(4)Except for the guaranty provided by EIB to Wells Fargo Bank, National Association (“Wells”) as part of the Revolver Loan, assume, guarantee or otherwise become liable as guarantor or surety for the obligation of any person or entity except in connection with the endorsement of checks for deposit in the ordinary course of business and other similar collection transactions in the ordinary course of business;

 

(5) Make any financial arrangements for borrowed money or otherwise through any other financial institution entity or party which is secured by the Real Estate except the revolving credit in the mount of $12,000,000 with Wells  and any refinancing of such loan (the “Revolver Loan”), the form of the mortgage shall be subject to Lender’s reasonable approval;

 

(6)Take any action, allow any event to occur or permit a condition to exist which could materially and adversely affect Borrower’s ability to complete its obligations under the terms of this Agreement, the Note, Mortgage or any other instruments, agreements or documents required of Borrower hereunder;

 

(7)Change the nature of Borrower’s current business;

 

(8)Make any change in the key management of Borrower; 

 

(9)Permit the control or ownership of Borrower or to be vested in anyone other than current owners; or

 

(10)Make any cash contribution or injection to Digonex  in excess of One Million Dollars ($1,000,000.00) in any calendar year until the Mandatory Principal Payment has been made.

 

7.Events of Default and Rights of Lender.  Any one (1) or more of the following shall constitute an Event of Default hereunder:

11

 

a.Failure to make any payment within ten (10) days of when due of principal or interest required by the Note;

 

b.A failure to pay or cause to be paid upon demand or within ten (10) days of when due any other amounts due under the Note, Mortgage, Assignment of Leases, Indemnity Agreement, this Agreement or any of the other Loan Documents securing the Loan;

 

c.Failure to observe or perform any agreement or covenant contained herein or in any of the Loan Documents securing the Loan within thirty (30) days after written notice of such failure, or such other period of time as is reasonably necessary to remedy such failure not to exceed an extra (60) days;

 

d.A material breach of any warranty, representation, certification or statement contained in this Agreement or in any certification or other agreement or document executed or delivered in connection herewith;

 

e.Dissolution, liquidation or termination of the business of Borrower;

 

f.Assignment by Borrower for the benefit of its creditors;

 

g.Appointment of a receiver or a trustee for Borrower or any of its assets, which appointment is consented to or, if not consented to, shall not be removed or discharged within sixty (60) days after such appointment;

 

h.The filing of a petition for relief under the United States Bankruptcy Code against Borrower, which petition is consented to or, if involuntary, remains undismissed for sixty (60) days after such filing; 

 

i.A determination by Lender, in its sole discretion, that any action, inaction, commission, omission or circumstance has occurred or may occur which may subject any assets of Borrower, including but not limited to the Real Estate, to be seized by any federal, state or local governmental department, agency or instrumentality pursuant to 18 U.S.C. Sec. 1963, 21 U.S.C. Sec. 853, 21 U.S.C. Sec. 881, 46 U.S.C. App. Sec. 1904, I.C. 34-4-30.1-1 et seq. or any similar federal, state or local laws and/or regulations adopted in publications promulgated pursuant to such laws, or as such laws or regulations may be amended, modified or supplemented from time to time; 

 

j.The occurrence and continuance for a period of fifteen (15) days after receipt of notice from Lender of any of the following:

 

(i)Borrower fails to maintain all material licenses, authorizations and approvals required to operate its business; or

 

(ii)The security interest or other lien purported to be created pursuant to the Loan Documents shall for any reason, except to the extent permitted by the 

12

 

terms thereof, cease to be a valid and perfected security interest or other lien, as the case may be, in any of the collateral purported to be covered thereby.

 

k.A default under the Revolver Loan or the Barrett Loan which remains in default after applicable notice and cure periods and relates to any matter involving an aggregate amount of not less than $250,000.00 and such default (i) occurs at the final maturity of the obligations thereunder or (ii) results in a right by such lender, irrespective if exercised, to accelerate the maturity of such Revolver Loan or Barrett Loan.

 

Upon an Event of Default hereunder, at the option of Lender and with further notice  to Borrower, all of the indebtedness evidenced by the Note and remaining unpaid shall become immediately due and payable. Anything contained herein or in the Note to the contrary notwithstanding, Lender, at its option and upon demand, shall have the right to perform all acts necessary for the performance, sale, collection and enforcement of the collateral covered by the Mortgage and/or any other agreement or document executed in connection with the Loan. Upon an Event of Default hereunder, at the option of Lender and with notice to Borrower, Lender may order an appraisal of the Real Estate, to be in such form and scope and to be performed by an appraiser as Lender may choose in its sole discretion. All costs and expenses of such appraisal shall be immediately paid by Borrower upon demand by Lender and such amounts shall be added to the indebtedness evidenced by the Loan and secured by the Mortgage. Furthermore, upon an Event of Default hereunder, Borrower, immediately upon demand by Lender, shall assemble the collateral securing the Loan and make it available to Lender at a place or places to be designated by Lender which are reasonably convenient to Lender and Borrower. Borrower recognizes that in the event Borrower fails to perform, observe or discharge any of its obligations under this Agreement or any other documents executed in connection herewith, Lender shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages. All rights and remedies of Lender herein specified are cumulative and in addition to, not in limitation of, any rights and remedies which it may have by law or at equity. 

8.Additional Rights of Lender.  If an Event of Default exists with respect to the Loan, Lender may, at its option and without demand, declare the entire principal sum under the Note to be due and payable immediately and may enter into possession of the Real Estate or any portion thereof and perform any and all work and labor necessary to repair and maintain the Real Estate. All sums so expended by Lender shall be deemed paid to Borrower and secured by all documents executed and delivered pursuant to the Loan. Upon and during the pendency of an Event of Default, each payment to Lender shall be applied to the payment of accrued and unpaid interest and to the reduction of the principal balance in such order and in such amounts as Lender shall determine, in its sole discretion; otherwise, such payments shall be applied first to accrued and unpaid interest and then to principal. Lender may from time to time without notice to Borrower (a) release any collateral or substitute or exchange any collateral, (b) release, modify or compromise any liability of Borrower or any other obligor, or the terms thereof and (c) apply any amounts paid to Lender with such marshalling of security as Lender may, in its sole discretion, determine appropriate to the extent permitted by law; all without the consent of or proper notice to Borrower. The liability of Borrower shall not be released in part or in whole by reason of the foregoing, the addition of co-makers, endorsers, guarantors or sureties, or a failure to perfect any security interest or lien in any collateral or a failure to proceed in any particular manner with 

13

 

respect to any collateral. All rights or remedies of Lender hereunder are cumulative and are in addition to, not in limitation of, any rights or remedies which it may have by law.

9.Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the successors and assigns of Lender and Borrower; provided, however, Borrower may not assign this Agreement without the prior written consent of Lender.

10.No Third-Party Beneficiaries.  Nothing contained herein shall be deemed or construed to create an obligation on the part of Lender to any third party nor shall any third party have a right to enforce against Lender any rights which Borrower may have under this Agreement.

11.No Waiver. No waiver by Lender of the breach of any term, condition, warranty, representation, covenant or agreement contained herein or in the agreements, instruments, guaranties or documents delivered pursuant thereto shall be considered as a waiver of the same default in the future or any other default and no delay or omission by Lender in exercising any right or remedy hereunder shall impair any such right or remedy or be construed as a waiver of any default. The inclusion of deadlines and the references to dates later than the maturity of any obligation shall not by implication or otherwise obligate Lender to renew or extend any maturity.

12.Waiver of Presentment.  Borrower waives presentment, demand and protest and notice of presentment, maturity, release, compromising settlement, extension or renewal of any or all commercial paper, accounts receivable, contract rights, documents, instruments, chattel paper and guaranties entered into by Borrower in connection herewith and at any time held by Lender and on which Borrower may be liable in any way.

13.Amendments.  Any modification of or amendment to this Agreement shall be ineffective unless in writing and signed by the duly authorized representatives of Borrower and Lender.

14.Notices.  Any notice required or permitted to Lender or Borrower hereunder shall be deemed effective when mailed, certified or registered United States mail, postage prepaid, or when sent by an overnight carrier which provides for a return receipt if to Borrower at 40 Monument Circle, Suite 700, Indianapolis, Indiana 46204, Attention: Ryan A. Hornaday, EVP, CFO and Treasurer, with a copy to J. Scott Enright, General Counsel, 40 Monument Circle, Suite 700, Indianapolis, Indiana 46204 or if to Lender at 3610 River Crossing Parkway, Indianapolis, Indiana 46240, Attention John McCreary, with a copy to Taft Stettinius & Hollister LLP, One Indiana Square, Suite 3500, Indianapolis, Indiana 46204, Attn: Jeffrey A. Abrams, or at such other address as either Borrower or Lender may from time to time specify by notice hereunder. Any notice required to be given by Lender of a sale, lease, other disposition of the collateral or any other intended action by Lender, deposited in the United States Mail, certified and registered with postage prepaid duly addressed as specified above no less than ten (10) business days prior to such proposed action, or if sent by overnight carrier no less than five (5) business days prior to such proposed action, shall constitute commercially reasonable and fair notice to Borrower of same.

14

 

15.Prior Agreements.  This Agreement replaces and supersedes any inconsistent provisions of any agreements heretofore made by Lender and Borrower. This Agreement, the Note and Mortgage and all other documents executed in connection with this Agreement are intended to be complementary and supplementary to one another. In the event of any conflict between the terms of one or more thereof, such terms shall, to the fullest extent reasonably possible, be construed to be complementary. However, if such terms cannot be construed as complementary, then the terms of this Agreement shall govern.

16.No Partnership/Joint Venture.  It is hereby acknowledged by Lender and Borrower that the relationship between them created hereby and by any other document executed in connection with the Loan is that of creditor and debtor and is not intended to be and shall not in any way be construed to be that of a partnership, a joint venture or that of principal and agent; and it is hereby further acknowledged that any control of or supervision over the construction of the Improvements by Lender or disbursement of the Loan to anyone other than Borrower shall not be deemed to make Lender a partner, joint venturer or principal or agent of Borrower, but rather shall be deemed to be solely for the purpose of protecting Lender’s security for the indebtedness evidenced by the Note and other indebtedness of Borrower to Lender.

17.Governing Law.  This Agreement has been entered into and shall be governed by and construed in accordance with the laws of the State of Indiana.

18.Survival of Indemnities.  All indemnities from Borrower to Lender shall survive this Agreement.

19.Invalidity of any Provision.  If any provision of this Agreement or of any other documents executed in connection herewith is held invalid or unenforceable, the remainder of this Agreement or such other documents and the application of such provisions to other persons or circumstances will not be affected hereby and the provisions of this Agreement and such other documents will be severable in such instance.

20.Captions.  The captions or headings herein have been inserted solely for the convenience of reference and in no way define, limit or describe the scope or substance of any provision of this Agreement.

21.Consent to Jurisdiction.  BORROWER HEREBY AGREES THAT ALL ACTIONS OR PROCEEDINGS INITIATED BY BORROWER AND ARISING DIRECTLY OR INDIRECTLY OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS SHALL BE LITIGATED IN THE SUPERIOR COURT OF MARION COUNTY, INDIANA, BOONE COUNTY, INDIANA OR A UNITED STATES DISTRICT COURT OF INDIANA OR, IF LENDER INITIATES SUCH ACTION, ANY COURT IN WHICH LENDER SHALL INITIATE SUCH ACTION AND WHICH HAS JURISDICTION. BORROWER HEREBY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED BY LENDER IN ANY OF SUCH COURTS. BORROWER WAIVES ANY CLAIM THAT MARION COUNTY, INDIANA, BOONE COUNTY, INDIANA OR A UNITED STATES DISTRICT COURT OF INDIANA IS AN 

15

 

INCONVENIENT FORUM OR AN IMPROPER FORUM BASED ON LACK OF VENUE.

22.Waiver of Jury Trial.  LENDER AND BORROWER ACKNOWLEDGE AND AGREE THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED HEREIN AND THEREIN WOULD BE BASED UPON DIFFICULT AND COMPLEX ISSUES AND THEREFORE, THE PARTIES VOLUNTARILY, KNOWINGLY AND INTENTIONALLY AGREE THAT ANY COURT PROCEEDING ARISING OUT OF ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.

23.Sole Discretion of Lender.  Except as may otherwise be expressly provided to the contrary, whenever pursuant to this Agreement or any of the Loan Documents, Lender exercises any right given to it to consent or not consent, approve or not approve, or any arrangement or term is to be satisfactory to Lender, the decision of Lender to consent or not consent, or to approve or not to approve, or to decide the arrangements or terms are satisfactory or not satisfactory shall be in the sole and reasonable discretion of Lender and shall be final and conclusive.

24.USA Patriot Act Notice.  Lender hereby notifies Borrower that pursuant to the requirements of the Patriot Act, Lender is required to obtain, verify and record information that identifies Borrower, which information includes the name and address of Borrower and other information that will allow Lender to identify Borrower in accordance with the Patriot Act. 

 

 

16

 

IN WITNESS WHEREOF, Borrower and Lender have executed this Loan Agreement.

 

	
EMMIS OPERATING COMPANy, an Indiana corporation 

 

	
By:
	
/s/ Ryan A. Hornaday

	
 
	
Ryan A. Hornaday, EVP, CFO & Treasurer

 

	
	
EMMIS INDIANA BROADCASTING, L.P., an Indiana limited partnership

 

	
By:
	
Emmis Operating Company, an Indiana corporation, general partner

 

	
By:
	
/s/ Ryan A. Hornaday

	
 
	
Ryan A. Hornaday, EVP, CFO & Treasurer

 

	
STAR FINANCIAL BANK

	
 
	
 

	
By:
	
/s/ John McCreary

	
 
	
John McCreary, Region President

 

17

 

EXHIBIT “A”

 

EOC Real Estate

Legal Description

 

Tract 1 (fee parcel)

Lot 13, and parts of Lots 11 and 12 in Square 55 of the Donation Lands of the City of Indianapolis, Indiana, more particularly described as follows:

Beginning at the Southwest corner of said Lot 13, thence on an assumed bearing of North 00 degrees 00 minutes 16 seconds West along the West line of said Lot 13 a distance of 156.37 feet (156.33 feet, plat) to the Northwest corner of said Lot 13; thence North 62 degrees 06 minutes 17 seconds East along the North line of said Lot 13 a distance of 126.32 feet (126.42 feet, plat) to the Northeast corner of said Lot 13 and a curve, having a radius of 246.65 feet the radius point of which bears North 62 degrees 16 minutes 47 seconds East; thence Southeasterly along the arc of said curve a distance of 141.94 feet to a point which bears South 29 degrees 18 minutes 33 seconds West from said radius; thence South 44 degrees 49 minutes 22 seconds West a distance of 49.86 feet; thence South 00 degrees 06 minutes 46 seconds East a distance of 79.54 feet to the South line of said Lot 11; thence South 89 degrees 55 minutes 38 seconds West along the South line of said Lot 11 and 12 a distance of 174.24 feet to the Point Of Beginning.

AND

Part of Court Street vacated by Declaratory Resolution No. 16366, 1947, recorded December 17, 1947 in Deed Record 1284, page 299 in the Office of the Recorder of Marion County, Indiana, described as follows:

Being that part of Court Street from a point 16 feet above the present surface to an unlimited height upwards, described as follows: Beginning at a point on the North line of Court Street 110 feet West of the West line of Meridian Street, said point being also 110 feet West of the Southeast corner of Lot 11 in Square 55, as recorded in the Marion County Recorder's Office, Indianapolis, Indiana; thence West along said North line of Court Street for a distance of 50 feet 3 1/8 inches; thence South along a line that is parallel to the West line of Meridian Street for a distance of 15 feet to the intersection of the South line of Court Street; thence East along the South line of Court Street for a distance of 50 feet 3 1/8 inches; thence North along a line that is parallel to the West line of Meridian Street for a distance of 15 feet to the Place Of Beginning.

Tract 2 (easement parcel over leasehold estate)

 

Non-exclusive easement of use for parking spaces as set forth in Amendment and Restatement of Grant of Easements Agreement dated December 17, 2004, and recorded January 10, 2005, as Instrument 2005-0004191. Amended by Assignment and Assumption of Rights Under G/T Project Agreement, Cross Easement and Parking Agreement and Cross Easement Agreement, dated December 2, 2004, and recorded January 10, 2005, as Instrument 2005-0004198. Further amended by Amendment to Amendment and Restatement of Grant of Easements Agreement 

18

 

dated January 14, 2009, and recorded July 29, 2014, as Instrument A201400069793; by Third Amendment to Grant of Easements Agreement, dated January 1, 2014, and recorded July 29, 2014, as Instrument A201400069794; and by Fourth Amendment to Grant of Easements Agreement dated December 21, 2018, and recorded January 15, 2019, as Instrument A201900004819. in the Office of the Recorder of Marion County, Indiana, affecting the following described land:

 

Lots 3, 4, the South Half of Lot 2 and a part of the 15 foot vacated right-of-way of Bird Street, all situated in Square 55 of the Donation Lands of the City of Indianapolis, Indiana, more particularly described as follows: Beginning at the Southwest corner of said Lot 4; thence on an assumed bearing of North 00 degrees 00 minutes 16 seconds West along the West line of said Lots 4, 3, and 2 a distance of 178.13 feet to the Northwest corner of the South Half of said Lot 2; thence North 89 degrees 55 minutes 38 seconds East along the North line of the South Half of said Lot 2 a distance of 120.00 feet to the Northeast corner of the South Half of said Lot 2; thence South 00 degrees 00 minutes 16 seconds East along the East line of Lot 2 a distance of 21.73 feet; thence North 89 degrees 59 minutes 44 seconds East perpendicular to the East line of said Lot 2 a distance of 15.00 feet to the Northwest corner of Lot 13; thence South 00 degrees 00 minutes 16 seconds East along the West line of Lot 13 a distance of 156.38 feet to the Southwest corner of Lot 13; thence South 89 degrees 55 minutes 38 seconds West along the Easterly extension of the South line of the aforesaid Lot 4 and along the South line of Lot 4 a distance of 135.00 feet to the point of beginning.

Tract 3

Those non-exclusive easements for public access, construction of parking garage, utilities, air rights and encroachment as created and granted inAmendment and Restatement of Grant of Easements Agreement dated December 17, 2004, and recorded January 10, 2005, as Instrument 2005-0004191. Amended by Assignment and Assumption of Rights Under G/T Project Agreement, Cross Easement and Parking Agreement and Cross Easement Agreement, dated December 2, 2004, and recorded January 10, 2005, as Instrument 2005-0004198. Further amended by Amendment to Amendment and Restatement of Grant of Easements Agreement dated January 14, 2009, and recorded July 29, 2014, as Instrument A201400069793; by Third Amendment to Grant of Easements Agreement, dated January 1, 2014, and recorded July 29, 2014, as Instrument A201400069794; and by Fourth Amendment to Grant of Easements Agreement dated December 21, 2018, and recorded January 15, 2019, as Instrument A201900004819. in the Office of the Recorder of Marion County, Indiana

Tract 4

 

Those non-exclusive easements for access as created and granted in that certain Cross Easement Agreement by and among the Department of Metropolitan Development, Circle Block Partners, LLC, and Goodman Taylor, Inc. dated December 3, 2004 and recorded January 10, 2005 as Instrument No. 2005-4194, as modified by an Assignment and Assumption of Rights Under G/T Project Agreement, Cross Easement and Parking Agreement and Cross Easement Agreement dated December 2, 2004 and recorded January 10, 2005 as Instrument No. 2005-4198 in the Office of the Recorder or Marion County, Indiana.

19

 

EXHIBIT “B”

 

EIB Real Estate

Legal Description

 

Part of the Southeast quarter of Section 36, Township 18 North, Range 1 East, in Boone County, Indiana, being more particularly described as follows:

 

Beginning at a point on the East line of said quarter section; South 00 degrees 26 minutes 18 seconds West 930.59 feet from the Northeast corner of said quarter section; thence South 00 degrees 26 minutes 18 seconds West along the said East line 1,405.00 feet to a point lying North 00 degrees 26 minutes 18 seconds East 300.00 feet from the Southeast corner of said quarter section; thence South 74 degrees 31 minutes 15 seconds West 1,133.40 feet to a point on the South line of said quarter section lying South 89 degrees 52 minutes 07 seconds West 1,090.00 feet from the Southeast corner of said quarter section; thence South 89 degrees 52 minutes 07 seconds West along said South line 338.95 feet to the Easterly right of way line for Interstate 65 per Indiana State Highway Commission Plans dated 1958, Project Number 03-4(11) the next three courses being along said Easterly right of way line; thence North 42 degrees 26 minutes 58 seconds West, 1,304.66 feet; thence North 40 degrees 09 minutes 32 seconds West 250.20 feet; thence North 42 degrees 26 minutes 58 seconds West 223.14 feet to the South line of the Northwest quarter of said quarter section; thence North 89 degrees 56 minutes 44 seconds East along said South line 1,292.54 feet to the Southeast corner of the Northwest quarter of said quarter section; thence North 00 degrees 24 minutes 53 seconds East along the East line of the Northwest quarter of said quarter section 388.47 feet; thence North 90 degrees 00 minutes 00 seconds East 1,339.17 feet to the Beginning Point.

20

 

EXHIBIT “C”

 

Subsidiaries

 

	
 
	
•
	
Emmis Radio License, LLC

	
 
	
•
	
Emmis License Corporation of New York

	
 
	
•
	
Emmis Radio License Corporation of New York

	
 
	
•
	
Radio Austin Management, LLC

	
 
	
•
	
Emmis Austin Radio Broadcasting Company, L.P.

	
 
	
•
	
Emmis Radio, LLC

	
 
	
•
	
Emmis Radio Holding Corporation

	
 
	
•
	
Emmis Radio Holding II Corporation

	
 
	
•
	
WBLS-WLIB, LLC

	
 
	
•
	
WLIB Tower LLC

	
 
	
•
	
WBLS-WLIB License LLC

	
 
	
•
	
Emmis Publishing Corporation

	
 
	
•
	
Emmis Publishing, L.P.

	
 
	
•
	
WHHL, LLC

 

Excluded Financial Subsidiaries

	
 
	
•
	
Emmis New York Radio LLC

	
 
	
•
	
Emmis New York Radio License LLC

	
 
	
•
	
Digonex Technologies, Inc.

	
 
	
•
	
TagStation, LLC

	
 
	
•
	
NextRadio, LLC

	
 
	
•
	
NextRadio Sales, LLC

	
 
	
•
	
Other subsidiaries designated as excluded non-guarantor subsidiaries by Borrower In accordance with the loan documents

 

21

 

EXHIBIT “D”

 

FORM OF COMPLIANCE CERTIFICATE

[on Borrower's letterhead]

 

	
To:
	
STAR Financial Bank

3610 River Crossing Parkway

Indianapolis, IN  46240

Attn:  Loan Portfolio Manager - Emmis

	
 
	
Re:
	
Compliance Certificate dated _____________, 20__

Ladies and Gentlemen:

Reference is hereby made to that certain Loan Agreement, dated as of April 12, 2019 (as amended, restated, supplemented, or otherwise modified from time to time, the "Loan Agreement"), by and among EMMIS OPERATING COMPANY, an Indiana corporation and EMMIS INDIANA BROADCASTING, L. P., each, a "Borrower" and collectively, jointly and severally, the "Borrowers"), and STAR Financial Bank, an Indiana bank ("Lender").  Capitalized terms used herein, but not specifically defined herein, shall have the meanings ascribed to them in the Loan Agreement.

Pursuant to Section 6 (e) (2) of the Loan Agreement, the undersigned officer of Borrowers hereby certifies as of the date hereof that:

1.The financial information of Borrowers and its Subsidiaries described on Exhibit “C” of the Loan Agreement has been prepared in accordance with GAAP (except, in the case of unaudited financial statements, for the lack of footnotes and being subject to year-end audit adjustments) and present fairly in all material respects, the Borrowers and its Subsidiaries' consolidated financial condition as of the date thereof and results of operations for the period then ended, except that with respect to unaudited consolidating financial statements (a) shared operating expenses (if applicable) are allocated among business units, as determined by Borrowers in good faith and consistently with past practice, and (b) the financial statements do not include income tax expense or benefit, interest income and expense, and non-cash compensation expenses associated with equity compensation arrangements.

2.Such officer has reviewed the terms of the Loan Agreement and has made, or caused to be made under his/her supervision, a review in reasonable detail of the transactions and financial condition of Borrowers and its Subsidiaries during the accounting period covered by the financial statements delivered pursuant to Section 6(e)(2) of the Loan Agreement.

3.Such review has not disclosed the existence on and as of the date hereof, and the undersigned does not have knowledge of the existence as of the date hereof, of any event or condition that constitutes an Event of Default, except for such conditions or events listed on Schedule 2 attached hereto, in each case specifying the nature and period of existence thereof and what action Borrowers and/or its Subsidiaries have taken, are taking, or propose to take with respect thereto.

22

 

4.Except as set forth on Schedule 3 attached hereto, the representations and warranties of Borrowers set forth in the Loan Agreement and the other Loan Documents are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date hereof (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of such earlier date.

5.As of the date hereof, Borrowers and their Subsidiaries are in compliance with the applicable covenants contained in Section 6 r of the Loan Agreement as demonstrated on Schedule 4 hereof.

[Signature page follows]

 

 

23

 

IN WITNESS WHEREOF, this Compliance Certificate is executed by the undersigned this ____ day of ____________, 20___.

 

	
	
EMMIS OPERATING COMPANY

 

	
By:  
	
 

	
Name:  
	
 

	
Title:  
	
 

 

	
	
EMMIS INDIANA BROADCASTING, L.P.

 

	
By:  
	
 

	
Name:  
	
 

	
Title:  
	
 

 

 

 

24

 

SCHEDULE 1

Financial Information

 

 

10430483v4 4/11/2019 3:44 PM1989.647

 

SCHEDULE 2

Event of Default

 

 

 

KD_Mortgage

24578149.1

24578149.3

 

SCHEDULE 3

Representations and Warranties

 

 

KD_Mortgage

24578149.1

24578149.3

 

SCHEDULE 4

Financial Covenants

1.Fixed Charge Coverage Ratio.

Borrower and its Subsidiaries' Fixed Charge Coverage Ratio, measured on a [quarter-end] basis, for the 12 month period ending ____________ ___, 20___, is ___:1.0, which ratio [is/is not] greater than or equal to the ratio set forth in Section 7(r) of the Loan Agreement for the corresponding period.

KD_Mortgage

24578149.1

24578149.3

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