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EXHIBIT 10.07
FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT is made and entered into as of
May 31, 2001, by and among ENTERCOM RADIO, LLC, a Delaware limited liability
company (the "Borrower"), ENTERCOM COMMUNICATIONS CORP., a Pennsylvania
corporation (the "Parent"), the FINANCIAL INSTITUTIONS listed on the signature
pages hereof (the "Lenders"), KEY CORPORATE CAPITAL INC., as Administrative
Agent and Co-Documentation Agent (the "Administrative Agent"), and BANK OF
AMERICA, N.A., as Syndication Agent and Co-Documentation Agent (the "Syndication
Agent").
RECITALS
A. The Borrower, the Parent, the Lenders, the Administrative Agent and
the Syndication Agent entered into a Credit Agreement dated as of December 16,
1999 (as the same may be amended, restated, supplemented or otherwise modified
from time to time, the "Original Agreement"), pursuant to which the Lenders
agreed to make available to the Borrower loans of up to $650,000,000 (subject to
increase under certain circumstances up to $1,000,000,000). The Original
Agreement, as amended hereby, may be referred to hereinafter as the "Credit
Agreement." Capitalized terms used herein and not otherwise defined shall have
the meanings assigned to them in the Credit Agreement.
B. The Borrower and the Parent desire to make certain changes to the
Original Agreement. Subject to the terms and conditions of this Amendment, the
Agents and the Lenders have agreed to such requests.
AGREEMENTS
In consideration of the foregoing Recitals and of the covenants and
representations contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Borrower, the
Parent, the Agents and the Lenders agree as follows:
1. Amendments. Subject to the satisfaction of the conditions set forth
in Section 2 of this Amendment, the Original Agreement shall be amended as
follows:
(a) Section 1.1 of the Credit Agreement shall be amended by
adding thereto the following definition in the proper alphabetical order:
"First Amendment" means the First Amendment to Credit
Agreement dated as of May 31, 2001, among the Borrower, the Parent, the
Agents and the Lenders.
(b) The first sentence of subsection 2.16(a) shall be amended
by extending the date referenced therein from "December 31, 2001" to "December
31, 2002," and the sentence, as so amended, shall read as follows:
At any time prior to December 31, 2002, the Borrower may solicit from
the Lenders increases in the Commitments of up to an aggregate amount
of $350,000,000; provided, however, that the Borrower may not request
such increase at any time that a Possible Default or an Event of
Default has occurred and is continuing; and provided, further, that
each such increase shall be in an amount of at least $50,000,000.
(c) Subsection 6.9(a) of the Credit Agreement shall be amended
by increasing the amount referenced therein from "$25,000,000" to "100,000,000,"
and the subsection, as so amended, shall read as follows:
(a) Agreed Upon Procedures Report. On or prior to the date on
which any Loan is made hereunder the proceeds of which will be used to
pay any part of the purchase price of a Permitted Acquisition, the
purchase price of which is in excess of $100,000,000, the Borrower
shall have delivered to the
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Administrative Agent a report, in form and substance satisfactory to
the Administrative Agent relating to the financial condition of the
stations being acquired pursuant to such Permitted Acquisition, signed
by an accounting or consulting firm acceptable to the Administrative
Agent and prepared in accordance with the procedures reasonably
requested by the Administrative Agent. The Administrative Agent hereby
acknowledges that the information on the financial condition of the
stations to be acquired under the Xxxxxxxx Purchase Agreements
contained in the Form S-1 filed with the Securities and Exchange
Commission on September 30, 1999, satisfies the provisions of this
Section 6.9(a) with respect to the stations acquired under the Xxxxxxxx
Purchase Agreements.
(d) Subsection 6.9(c) of the Credit Agreement shall be amended
by increasing the amount referenced therein from "$10,000,000" to $25,000,000,"
and the subsection, as so amended, shall read as follows:
(c) Compliance Certificate. On, or one Banking Day prior to,
the date of each borrowing hereunder of $25,000,000 or more and the
date of each issuance of a Letter of Credit with a stated amount of
$25,000,000 or more, the Borrower shall have delivered to the
Administrative Agent a pro forma compliance certificate using the most
recently available quarterly financial statements, in form and
substance reasonably satisfactory to the Administrative Agent, showing
the Leverage Ratio as the date of such borrowing or issuance of a
Letter of Credit and the Borrower's compliance on a pro forma basis
with the financial covenants set forth in Section 8.
(e) The first and second sentences of Section 7.3 of the
Credit Agreement shall be amended by deleting the phrase "including fire,
lightning, vandalism, flood (to the extent required by the Administrative Agent,
if any Loan Party's property is located in an identified flood hazard area, in
which insurance has been made available pursuant to the National Flood Insurance
Act of 1968) and other risks" from the first sentence and deleting the phrase
"which shall not exceed $500,000 (or, in the case of earthquake, flood and
windstorm coverage, $1,000,000)" from the second sentence and substituting
"$5,000,000" in lieu thereof, and the first and second sentences, as so amended,
shall read as follows:
Each of the Parent and the Borrower shall, and shall cause each of the
Borrower's Subsidiaries to, keep its insurable properties insured to
the full replacement cost thereof at all times by financially sound and
reputable insurers reasonably acceptable to the Administrative Agent,
and maintain such other property insurance, to such extent and against
such risks insured against by extended coverage, as is customary with
companies in the broadcasting business. All such insurance shall be in
amounts sufficient to prevent any Loan Party from becoming a coinsurer,
shall name the Administrative Agent, for the benefit of the Lenders, as
loss payee and may contain loss deductible provisions which shall not
exceed $5,000,000.
(f) Subsection 7.6(f) of the Credit Agreement shall be amended
by deleting the phrase ", slow down or work stoppage due to a labor
disagreement," and the subsection, as so amended, shall read as follows:
(f) promptly after its Knowledge of the occurrence thereof, of
any material strike or labor dispute (or any material development
regarding any thereof) affecting any Loan Party.
(g) The second sentence of Section 7.9 of the Credit Agreement
shall be amended by deleting the phrase "or other material contract," and the
sentence, as so amended, shall read as follows:
If any Loan Party enters into a new Operating Agreement which prohibits
the assignment thereof or the granting of a security interest therein
without the consent of the other party, the Loan Parties shall use
their commercially reasonable efforts to obtain the written consent of
such other party to the grant to the Administrative Agent, for the
benefit of the Lenders, of a security interest therein pursuant to the
Security Agreements; provided, however, that the Loan Parties shall not
be obligated to accept any material adverse change in any such
agreement or contract or expend a material amount in attempting to
obtain such consent.
(h) Section 7.12 of the Credit Agreement shall be amended in
its entirety to read as follows:
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7.12 Rate Hedging Obligations. The Borrower shall, at all
times that the Leverage Ratio equals or exceeds 3.5 to 1.0, as
reflected on the most recent compliance certificate delivered pursuant
to Section 6.9(c) or 7.5(d), maintain in full force and effect
agreements having an initial term of at least two years and in form and
substance reasonably satisfactory to the Administrative Agent regarding
Rate Hedging Obligations so that the sum of the notional amount subject
to such agreements plus the outstanding principal amount of
Indebtedness for Borrowed Money of the Borrower which bears interest at
a fixed rate equals at all times at least 50% of the principal amount
of Indebtedness for Borrowed Money then outstanding; provided, however,
that the Borrower shall have a period of forty-five days, commencing
with the delivery of any such compliance certificate that shows either
(i) that the Leverage Ratio has increased since the date of the last
compliance certificate to exceed 3.5 to 1.0 or (ii) the required
percentage coverage is less than 50% and the Leverage Ratio exceeds 3.5
to 1.0, to enter into agreements required by this Section to cause the
percentage coverage to equal or exceed 50%.
(i) Subsection 8.10(a)(ii) shall be amended by increasing the
amount referenced therein from "10,000,000" to "$25,000,000," and the
subsection, as so amended, shall read as follows:
(ii) sell, lease, transfer or otherwise dispose of any
material portion of its properties and assets to any Person (other than
a wholly owned Subsidiary of the Borrower), except for (A) the
disposition of assets in the ordinary course of business in an
aggregate amount not to exceed $25,000,000 for all Loan Parties in any
transaction or related series of transactions, (B) the disposition of
any asset which, in the good faith exercise of its business judgment,
the Borrower determines is no longer useful in the conduct of its or
its Subsidiaries' business, (C) the exchange of a Station in connection
with a Permitted Acquisition, subject to the satisfaction of the
provisions of Section 2.7(b)(iii), (D) Capital Distributions permitted
to be made pursuant to Section 8.9(a), and (E) the liquidation or
merger into the Borrower of a wholly owned Subsidiary that has no
material liabilities and no material assets other than the capital
stock or other equity interests in a wholly owned Subsidiary of the
Borrower;
(j) Subsection 8.10(b)(ii) shall be amended by adding the
phrase "(or such shorter period as the Administrative Agent may reasonably deem
acceptable under the circumstances)" and the subsection, as so amended, shall
read as follows:
(ii) the Borrower shall have given to the Administrative Agent
notice of any such acquisition with a purchase price of $25,000,000 or
more at least five days (or such shorter period as the Administrative
Agent may reasonably deem acceptable under the circumstances) prior to
executing any binding commitment with respect thereto, which notice
shall state the additional amounts, if any, by which the Borrower
proposes to increase the dollar limitations set forth in Sections 8.4,
8.5 and 8.6;
(k) Subsection 8.11(g)(ii) shall be amended by increasing the
amount referenced therein from "$5,000,000" to "$10,000,000," and the
subsection, as so amended, shall read as follows:
(ii) the Borrower shall have given notice to the
Administrative Agent of each such investment in excess of $10,000,000
at least three Banking Days prior to making such investment,
2. Conditions to Effectiveness. The amendments set forth in
Section 1 shall be effective on such date on which all of the following
conditions are satisfied:
(a) The Borrower, the Parent, the Agents and the
Required Lenders shall have executed this Amendment and delivered counterpart
signature pages to the Administrative Agent or its counsel.
(b) The Borrower shall have delivered to the
Administrative Agent a certified copy of resolutions of the Members of the
Borrower evidencing approval of the execution, delivery and performance of this
Amendment.
(c) The Borrower and the Parent shall have delivered
to the Administrative Agent such other documents, instruments and opinions as
the Administrative Agent or any Lender may reasonably request.
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3. Representations, Warranties and Events of Default.
(a) Except as amended hereby, the terms, provisions,
conditions and agreements of the Original Agreement are hereby ratified and
confirmed and shall remain in full force and effect. Each and every
representation and warranty of the Borrower and the Parent set forth in the
Original Agreement (other than those which by their terms are limited to a
specific date) is hereby confirmed and ratified in all material respects, and
such representations and warranties as so confirmed and ratified shall be deemed
to have been made and undertaken as of the date of this Amendment as well as at
the time they were made and undertaken, except to the extent such
representations and warranties have been affected by events permitted pursuant
to the Credit Agreement.
(b) Each of the Borrower and the Parent represents
and warrants that:
(i) No Event of Default or Possible Default
now exists or will exist immediately following the execution hereof.
(ii) All necessary corporate, member,
stockholder or other actions on the part of the Borrower, the Members of the
Borrower, the Parent and the stockholders of the Parent to authorize the
execution, delivery and performance of this Amendment and all other documents or
instruments required pursuant hereto or thereto have been taken; this Amendment
and each such other document or instrument have been duly and validly executed
and delivered and are legally valid and binding upon the Borrower and the Parent
and enforceable in accordance with their respective terms, except to the extent
that the enforceability thereof may be limited by bankruptcy, insolvency or like
laws or by general equitable principles.
(iii) The execution, delivery and
performance of this Amendment and all other documents and instruments required
pursuant hereto or thereto, and all actions and transactions contemplated hereby
and thereby will not (A) violate, be in conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under (I) any
provision of any Organizational Document of the Parent, the Borrower or any
Subsidiary, (II) any arbitration award or any order of any court or of any other
governmental agency or authority, (III) any license, permit or authorization
granted to the Parent, the Borrower or any Subsidiary or under which the Parent,
the Borrower or any Subsidiary operates, or (IV) any applicable law, rule, order
or regulation, indenture, agreement or other instrument to which the Parent, the
Borrower or any Subsidiary is a party or by which the Parent, the Borrower or
any Subsidiary or any of their respective properties is bound and which has not
been waived or consented to, or (B) result in the creation or imposition of any
lien, charge or encumbrance of any nature whatsoever, except as expressly
permitted in the Credit Agreement, upon any of the properties of the Parent, the
Borrower or any Subsidiary.
(iv) No consent, approval or authorization
of, or filing, registration or qualification with, any governmental authority
(including, without limitation, the FCC and any other Licensing Authority) is
required to be obtained by the Parent, the Borrower or any Subsidiary in
connection with the execution, delivery or performance of this Amendment or any
document or instrument required in connection herewith which has not already
been obtained or completed.
4. Affirmation of the Borrower and the Parent. Each of the
Borrower and the Parent has executed this Amendment to consent to the amendments
to the Original Agreement made pursuant hereto and to acknowledge that the
security interests and liens granted by the Borrower and the Parent to the
Administrative Agent, for the benefit of the Lenders, pursuant to the Parent
Security Agreement, the Parent Pledge Agreement, the Borrower Security
Agreement, the Borrower Pledge Agreement and the other Collateral Documents to
which the Borrower or the Parent is a party remain in full force and effect and
shall continue to secure all Obligations and are hereby ratified and reaffirmed.
The Parent, as a guarantor, ratifies and reaffirms all of its payment and
performance obligations, contingent or otherwise, under Section 11 of the Credit
Agreement. The execution of this Amendment shall not operate as a waiver of any
right, power or remedy of the Agents or the Lenders, constitute a waiver of any
provision of any of the Collateral Documents or serve to effect a novation of
the Obligations.
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5. Fees and Expenses. As required under the Original
Agreement, the Borrower will reimburse the Administrative Agent upon demand for
all out-of-pocket costs, charges and expenses of the Administrative Agent
(including reasonable fees and disbursements of special counsel to the
Administrative Agent) in connection with the preparation, negotiation, execution
and delivery of this Amendment and the other agreements or documents relating
hereto or required hereby.
6. Counterparts. This Amendment may be executed in as many
counterparts as may be convenient and shall become binding when the Borrower,
the Parent, the Agents and each Lender have executed at least one counterpart.
7. Governing Law. This Amendment shall be a contract made
under and governed by the laws of the State of New York, without regard to the
conflicts of law provisions thereof.
8. Binding Effect. This Amendment shall be binding upon and
shall inure to the benefit of the Borrower, the Parent, the Agents, the Lenders
and their respective successors and assigns.
9. Reference to Original Agreement. Except as amended hereby,
the Original Agreement shall remain in full force and effect and is hereby
ratified and confirmed in all respects. On and after the effectiveness of the
amendments to the Original Agreement accomplished hereby, each reference in the
Original Agreement to "this Agreement", "hereunder", "hereof", "herein" or words
of like import, and each reference to the Original Agreement in any Note or
other Collateral Document, or other agreement, document or instrument executed
and delivered pursuant to the Original Agreement, shall be deemed a reference to
the Original Agreement, as amended hereby.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties have executed this First
Amendment to Credit Agreement as of the date first above written.
BORROWER:
ENTERCOM RADIO, LLC
By:___________________________
Name:_________________________
Title:________________________
PARENT:
ENTERCOM COMMUNICATIONS CORP.
By:___________________________
Name:_________________________
Title:________________________
LENDERS:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name:_________________________
Title:________________________
ALLFIRST BANK
By: __________________________
Name:_________________________
Title:________________________
BANK OF AMERICA, N.A.
By:___________________________
Name:_________________________
Title:________________________
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BANK OF MONTREAL
By: __________________________
Name:_________________________
Title:________________________
THE BANK OF NOVA SCOTIA
By: __________________________
Name:_________________________
Title:________________________
BANQUE NATIONALE DE PARIS
By: __________________________
Name:_________________________
Title:________________________
By: __________________________
Name:_________________________
Title:________________________
THE CHASE MANHATTAN BANK
By: __________________________
Name:_________________________
Title:________________________
CREDIT INDUSTRIEL ET COMMERCIAL
By:___________________________
Name:_________________________
Title:________________________
By:___________________________
Name:_________________________
Title:________________________
CREDIT SUISSE FIRST BOSTON
By: __________________________
Name:_________________________
Title:________________________
By: __________________________
Name:_________________________
Title:________________________
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THE DAI-ICHI KANGYO BANK, LTD.
By: __________________________
Name:_________________________
Title:________________________
BANKERS TRUST COMPANY
By: __________________________
Name:_________________________
Title:________________________
ERSTE BANK
By: __________________________
Name:_________________________
Title:________________________
FIRST HAWAIIAN BANK
By: __________________________
Name:_________________________
Title:________________________
FLEET BANK, N.A.
By: __________________________
Name:_________________________
Title:________________________
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By: __________________________
Name:_________________________
Title:________________________
ING (U.S.) CAPITAL LLC
By: __________________________
Name:_________________________
Title:________________________
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THE MITSUBISHI TRUST AND BANKING CORPORATION
By: __________________________
Name:_________________________
Title:________________________
PNC BANK, NATIONAL ASSOCIATION
By: __________________________
Name:_________________________
Title:________________________
COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK B.A.,
"Rabobank International", New York Branch
By: __________________________
Name:_________________________
Title:________________________
By: __________________________
Name:_________________________
Title:________________________
SUMMIT BANK
By: __________________________
Name:_________________________
Title:________________________
SUNTRUST BANK, F/K/A
SUNTRUST BANK, CENTRAL FLORIDA, N.A.
By: __________________________
Name:_________________________
Title:________________________
UNION BANK OF CALIFORNIA, N.A.
By: __________________________
Name:_________________________
Title:________________________
U.S. BANK NATIONAL ASSOCIATION
By: __________________________
Name:_________________________
Title:________________________
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XXXXXXX XXXX
By: __________________________
Name:_________________________
Title:________________________
MICHIGAN NATIONAL BANK
By: __________________________
Name:_________________________
Title:________________________
THE FUJI BANK, LIMITED
By: __________________________
Name:_________________________
Title:________________________
CITIZENS BANK OF MASSACHUSETTS
By: __________________________
Name:_________________________
Title:________________________
ISSUING BANK:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name:_________________________
Title:________________________
ADMINISTRATIVE AGENT:
KEY CORPORATE CAPITAL INC.
By:___________________________
Name:_________________________
Title:________________________
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SYNDICATION AGENT:
BANK OF AMERICA, N.A.
By:___________________________
Name: ________________________
Title: _______________________
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