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EXHIBIT 4.3
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CREDIT AGREEMENT
AMONG
TRAVEL CHANNEL ACQUISITION CORPORATION
The Several Lenders
from Time to Time Parties Hereto
and
UNION BANK OF CALIFORNIA, N.A.,
AS THE AGENT
DATED AS OF JULY 11, 1997
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CLOSING INDEX
FOR
TRAVEL CHANNEL ACQUISITION CORPORATION
CREDIT AGREEMENT
DATED AS OF
JULY 11, 1997
1. Credit Agreement
Schedules
1.1 Lenders, Commitments and Addresses
3.1(d) Ownership of Subsidiaries
3.1(e) Real Property
3.15 Insurance
3.16(b) Intellectual Property
3.18(b) UCC Filing Offices
Exhibits
A-1 Form of Revolving Credit Note
A-2 Form of Term Note
B-1 Form of ▇▇▇▇▇▇ Pledge Agreement
B-2 Form of PCUH Pledge Agreement
B-3 Form of Borrower Pledge Agreement
C Form of Borrower Security Agreement
D Form of Subsidiaries Guarantee
E Form of Subsidiaries Pledge Agreement
F Form of Subsidiaries Security Agreement
G Form of Borrowing Certificate
H Form of Assignment and Acceptance
2. ▇▇▇▇▇▇ Pledge Agreement
3. PCUH Pledge Agreement
4. Borrower Security Agreement
5. Legal Opinion of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
6. Legal Opinion of Dow, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
7. Legal Opinion of Beckley, Singleton, ▇▇▇▇▇▇▇ & List
8. Borrowing Certificate
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TABLE OF CONTENTS
Page
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SECTION 1. DEFINITIONS.................................................................................. 1
1.1 Defined Terms................................................................................ 1
1.2 Other Definitional Provisions................................................................ 16
SECTION 2. AMOUNT AND TERMS OF TERM LOANS AND REVOLVING
CREDIT COMMITMENTS........................................................................ 16
2.1 Term Loan.................................................................................... 16
2.2 Revolving Credit Commitments................................................................. 17
2.3 Commitment Fee............................................................................... 18
2.4 Repayment of Loans; Evidence of Debt......................................................... 18
2.5 Optional Prepayments......................................................................... 19
2.6 Mandatory Prepayments........................................................................ 19
2.7 Conversion and Continuation Options.......................................................... 20
2.8 Minimum Amounts and Maximum Number of Tranches............................................... 20
2.9 Interest Rates and Payment Dates............................................................. 20
2.10 Computation of Interest and Fees............................................................. 21
2.11 Inability to Determine Interest Rate......................................................... 21
2.12 Pro Rata Treatment and Payments.............................................................. 22
2.13 Illegality................................................................................... 23
2.14 Requirements of Law.......................................................................... 23
2.15 Taxes........................................................................................ 24
2.16 Indemnity.................................................................................... 26
2.17 Change of Lending Office..................................................................... 26
2.18 Further Assurances Regarding Security........................................................ 26
SECTION 3. REPRESENTATIONS AND WARRANTIES............................................................... 27
3.1 Organization, Powers, Good Standing and Business............................................. 27
3.2 Authorization of Borrowing, etc.............................................................. 28
3.3 Financial Condition.......................................................................... 29
3.4 No Material Adverse Change; No Restricted Payments........................................... 29
3.5 Title To Properties; Liens................................................................... 29
3.6 Litigation; Adverse Facts.................................................................... 30
3.7 Payment of Taxes............................................................................. 30
3.8 Performance of Agreements.................................................................... 30
3.9 Governmental Regulation...................................................................... 30
3.10 Securities Activities........................................................................ 30
3.11 Employee Benefit Plans....................................................................... 31
3.12 Certain Fees................................................................................. 31
3.13 Environmental................................................................................ 31
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Page
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3.14 Solvency..................................................................................... 33
3.15 Insurance.................................................................................... 33
3.16 Intellectual Property........................................................................ 33
3.17 Disclosure................................................................................... 34
3.18 Security Documents........................................................................... 34
3.19 Purposes of Loans............................................................................ 34
SECTION 4. CONDITIONS PRECEDENT......................................................................... 35
4.1 Conditions to Initial Loans.................................................................. 35
4.2 Conditions to Each Loan...................................................................... 37
SECTION 5. AFFIRMATIVE COVENANTS........................................................................ 38
5.1 Financial Statements and Systems............................................................. 38
5.2 Maintenance of Existence, etc................................................................ 41
5.3 Payment of Taxes and Claims; Tax Consolidation............................................... 41
5.4 Maintenance of Properties; Insurance......................................................... 42
5.5 Inspection; Lender Meeting................................................................... 42
5.6 Compliance with Laws, etc.................................................................... 42
5.7 Environmental Disclosure and Inspection...................................................... 43
5.8 Hazardous Materials; the Borrower's Remedial Action.......................................... 44
5.9 Additional Loan Parties...................................................................... 44
5.10 Schedule Supplements......................................................................... 44
5.11 Unrestricted Subsidiary...................................................................... 45
SECTION 6. NEGATIVE COVENANTS........................................................................... 45
6.1 Limitation on Indebtedness................................................................... 45
6.2 Liens and Related Matters.................................................................... 45
6.3 Investments; Joint Ventures.................................................................. 46
6.4 Contingent Obligations....................................................................... 46
6.5 Restricted Payments.......................................................................... 47
6.6 Restriction on Fundamental Changes; Asset Sales.............................................. 47
6.7 Sales and Lease-Backs........................................................................ 47
6.8 Sale or Discount of Receivables.............................................................. 47
6.9 Transactions with Shareholders and Affiliates................................................ 48
6.10 Disposal of Subsidiary Stock................................................................. 48
6.11 Conduct of Business.......................................................................... 48
6.12 Amendments or Waivers of Charter Documents; Limitation on
Optional Payments......................................................................... 48
6.13 Fiscal Year.................................................................................. 48
SECTION 7. EVENTS OF DEFAULT............................................................................ 49
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SECTION 8. THE AGENT.................................................................................... 52
8.1 Appointment.................................................................................. 52
8.2 Delegation of Duties......................................................................... 52
8.3 Exculpatory Provisions....................................................................... 53
8.4 Reliance by the Agent........................................................................ 53
8.5 Notice of Default............................................................................ 53
8.6 Non-Reliance on the Agent and Other Lenders.................................................. 54
8.7 Indemnification.............................................................................. 54
8.8 The Agent in Its Individual Capacity......................................................... 54
8.9 Successor the Agent.......................................................................... 55
SECTION 9. MISCELLANEOUS................................................................................ 55
9.1 Amendments and Waivers....................................................................... 55
9.2 Notices...................................................................................... 56
9.3 No Waiver; Cumulative Remedies............................................................... 56
9.4 Survival of Representations and Warranties................................................... 56
9.5 Payment of Expenses and Taxes................................................................ 57
9.6 Successors and Assigns; Participations and Assignments....................................... 57
9.7 Adjustments; Set-off......................................................................... 59
9.8 Counterparts; Effectiveness.................................................................. 60
9.9 Severability................................................................................. 60
9.10 Integration.................................................................................. 60
9.11 GOVERNING LAW................................................................................ 61
9.12 Submission To Jurisdiction; Waivers.......................................................... 61
9.13 Acknowledgements............................................................................. 61
9.14 WAIVERS OF JURY TRIAL........................................................................ 62
9.15 Confidentiality.............................................................................. 62
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SCHEDULES
1.1 Lenders, Commitments and Addresses
3.1(d) Ownership of Subsidiaries
3.1(e) Real Property
3.15 Insurance
3.16(b) Intellectual Property
3.18(b) UCC Filing Offices
EXHIBITS
A-1 Form of Revolving Credit Note
A-2 Form of Term Note
B-1 Form of ▇▇▇▇▇▇ Pledge Agreement
B-2 Form of PCUH Pledge Agreement
B-3 Form of Borrower Pledge Agreement
C Form of Borrower Security Agreement
D Form of Subsidiaries Guarantee
E Form of Subsidiaries Pledge Agreement
F Form of Subsidiaries Security Agreement
G Form of Borrowing Certificate
H Form of Assignment and Acceptance
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CREDIT AGREEMENT, dated as of July 11, 1997, among TRAVEL
CHANNEL ACQUISITION CORPORATION, a Delaware corporation (the "Borrower"), the
several banks and other financial institutions from time to time parties to this
Agreement (the "Lenders") and UNION BANK OF CALIFORNIA, N.A., as Agent for the
Lenders hereunder.
W I T N E S S E T H:
WHEREAS, the Borrower has requested the Lenders to make
available a $22,000,000 bridge term loan facility to be used by the Borrower to
finance, in part, the acquisition of substantially all of the assets of The
Travel Channel and interest thereon and a $1,000,000 bridge revolving credit
facility to finance its working capital needs.
NOW THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms shall
have the following meanings:
"Affiliate": as to any Person, any other Person (other than a
Subsidiary) which, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person. For
purposes of this definition, "control" of a Person means the power,
directly or indirectly, either to (a) vote 10% or more of the
securities having ordinary voting power for the election of directors
of such Person or (b) direct or cause the direction of the management
and policies of such Person, whether by contract or otherwise.
"Agent": Union Bank of California, N.A., together with its
affiliates, as the agent for the Lenders under this Agreement and the
other Loan Documents.
"Agreement": this Credit Agreement, as amended, supplemented
or otherwise modified from time to time.
"Applicable Margin": (a) for the period from the Closing Date
through and including March 31, 1998: (i) with respect to Base Rate
Loans, 2.50% and (ii) with respect to Eurodollar Loans, 3.50% and (b)
for the period from April 1, 1998 through and including the Termination
Date: (i) with respect to Base Rate Loans, 2.75% and (ii) with respect
to Eurodollar Loans, 3.75%.
"Asset Acquisition Agreement": the Asset Acquisition Agreement
dated as of June 13, 1997 by and among Landmark Communications, Inc.,
The Travel Channel, Inc., and PCC.
"Available Revolving Credit Commitment": as to any Lender at
any time, an amount equal to the excess, if any, of (a) such Lender's
Revolving Credit
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Commitment over (b) the aggregate principal amount of all Revolving
Credit Loans made by such Lender then outstanding.
"Base Rate": with respect to each day, the greater on such day
of (a) the per annum rate most recently determined by the Agent at its
U.S. lending office from time to time as its base rate and (b) 1/2% per
annum plus the Federal Funds Rate. Each change in the Base Rate shall
take effect simultaneously with the corresponding change or changes in
such base rate or the Federal Funds Rate, as the case may be. The Base
Rate is not intended to be necessarily the lowest rate of interest
charged by the Agent in connection with extensions of credit to
debtors.
"Base Rate Loans": Loans the rate of interest applicable to
which is based upon the Base Rate.
"Board": the Board of Governors of the Federal Reserve
System.
"Borrower Pledge Agreement": the Pledge Agreement to be
executed and delivered by the Borrower, substantially in the form of
Exhibit B-3, as the same may be amended, supplemented or otherwise
modified from time to time.
"Borrower Security Agreement": the Security Agreement to be
executed and delivered by the Borrower, substantially in the form of
Exhibit C, as the same may be amended, supplemented or otherwise
modified from time to time.
"Borrowing Date": any Business Day specified in a notice
pursuant to subsections 2.1 and 2.2 as a date on which the Borrower
requests the Lenders to make Loans hereunder.
"Business Day": a day other than a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or
required by law to close.
"Capital Lease": any lease of property, real or personal, the
obligations of the lessee in respect of which are required in
accordance with GAAP to be capitalized on a balance sheet of the
lessee.
"Capital Stock": any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests in a Person
(other than a corporation) and any and all warrants or options to
purchase any of the foregoing.
"Cash": money, currency or a credit balance in a Deposit
Account.
"Cash Equivalents": (i) direct obligations of the United
States or any agency thereof, or obligations guaranteed or insured by
the United States, provided that in each case such obligations mature
within one year from the date of acquisition thereof, (ii) certificates
of deposit maturing within one year from the date of creation thereof
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issued by any United States national or state banking institution
having capital, surplus and undivided profits aggregating at least
$250,000,000 and rated at least A-1 by Standard & Poor's Corporation
and P-1 by ▇▇▇▇▇'▇ Investors Service, Inc., (iii) commercial paper with
a maturity of 180 days or less issued by a corporation (except an
Affiliate of the Borrower) organized under the laws of any state of the
United States or the District of Columbia and rated at least A-1 by
Standard & Poor's Corporation or at least P-1 by ▇▇▇▇▇'▇ Investors
Service, Inc. and (iv) repurchase agreements and reverse repurchase
agreements relating to marketable direct obligations issued or
unconditionally guaranteed by the United States or issued by an agency
thereof and backed by the full faith and credit of the United States,
in each case maturing within one year from the date of acquisition;
provided that the terms of such agreements comply with the guidelines
set forth in the Federal Financial Agreements of Depository
Institutions with Securities Dealers and Others, as adopted by the
Comptroller of the Currency and (v) tax-exempt auction rate securities
and municipal preferred stock, in each case, subject to reset no more
than 35 days after the date of acquisition and having a rating of at
least AA by Standard & Poor's Corporation or AA by ▇▇▇▇▇'▇ Investors
Service, Inc.
"Clear Channel": Clear Channel Communications Corporation, a
Delaware corporation.
"Closing Date": the date on which the conditions precedent set
forth in subsection 4.1 shall be satisfied.
"Code": the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral": all assets of the Loan Parties, now owned or
hereinafter acquired, upon which a Lien is purported to be created by
any Security Document.
"Commitment": as to any Lender, the sum of the Term Loan
Commitment and the Revolving Credit Commitment of such Lender.
"Commitment Percentage": as to any Lender at any time, the
percentage which such Lender's Commitment then constitutes of the
aggregate Commitments (or, at any time after the Commitments shall have
expired or terminated, the percentage which the aggregate principal
amount of such Lender's Loans then outstanding constitutes of the
aggregate principal amount of the Loans then outstanding).
"Commitment Period": the period from and including the date
hereof to but not including the Termination Date or such earlier date
on which the Commitments shall terminate as provided herein.
"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Borrower within
the meaning of Section 4001 of ERISA or is part of a group which
includes the Borrower and which is treated as a single employer under
Section 414 of the Code.
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"Compliance Certificate": as defined in subsection
5.1(b)(iv).
"Contingent Obligation": as applied to any Person, any direct
or indirect liability, contingent or otherwise, of that Person (a) with
respect to any indebtedness, lease, dividend or other obligation of
another if the primary purpose or intent thereof by the Person
incurring the Contingent Obligation is to provide assurance to the
obligee of such obligation of another that such obligation of another
will be paid or discharged, or that any agreements relating thereto
will be complied with, or that the holders of such obligation will be
protected (in whole or in part) against loss in respect thereof, (b)
with respect to any letter of credit issued for the account of that
Person or as to which that Person is otherwise liable for reimbursement
of drawings, or (c) under Interest Rate Agreements. Contingent
Obligations shall include, without limitation, (i) the direct or
indirect guaranty, endorsement (otherwise than for collection or
deposit in the ordinary course of business), co-making, discounting
with recourse or sale with recourse by such Person of the obligation of
another, (ii) the obligation to make take-or-pay or similar payments if
required regardless of non-performance by any other party or parties to
an agreement, and (iii) any liability of such Person for the
obligations of another through any agreement (contingent or otherwise)
(x) to purchase, repurchase or otherwise acquire such obligation or any
security therefor, or to provide funds for the payment or discharge of
such obligation (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise), or (y) to maintain the
solvency or any balance sheet item, level of income or financial
condition of another, if in the case of any agreement described under
subclauses (x) or (y) of this sentence, the primary purpose or intent
thereof is as described in the preceding sentence. The amount of any
Contingent Obligation (other than Interest Rate Agreements) as of any
date shall be equal to the amount of the obligation as of any date so
guaranteed or otherwise supported. The amount of any Interest Rate
Agreement as of any date shall be equal to the aggregate amount that
would be payable by such Person if such Interest Rate Agreement were
terminated on such date as a result of a default thereunder by such
Person.
"Contractual Obligation": as to any Person, any provision of
any security issued by such Person or of any agreement (credit or
otherwise), instrument or other undertaking to which such Person is a
party or by which it or any of its property is bound.
"Default": any of the events specified in Section 7, whether
or not any requirement for the giving of notice, the lapse of time, or
both, or any other condition, has been satisfied.
"Deposit Account": a demand, time, savings, passbook or like
account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable
certificate of deposit.
"Dollars" and "$": dollars in lawful currency of the United
States of America.
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"Employee Benefit Plan": any employee benefit plan within the
meaning of Section 3(3) of ERISA which is maintained for employees of
the Borrower or any ERISA Affiliates.
"Environmental Claim": any accusation, allegation, notice of
violation, claim, demand, abatement order or other order or direction
(conditional or otherwise) by any governmental authority or any Person
for any damage, including, without limitation, personal injury
(including sickness, disease or death), tangible or intangible property
damage, contribution, indemnity, indirect or consequential damages,
damage to the environment, nuisance, pollution, contamination or other
adverse effects on the environment, or for fines, penalties or
restrictions, resulting from or based upon (i) the existence of a
Release (whether sudden or non-sudden or accidental or non-accidental),
of, or exposure to, any Hazardous Material, in, into or onto the
environment, (ii) the use, handling, transportation, storage, treatment
or disposal of Hazardous Materials, or (iii) the violation, or alleged
violation, of any Environmental Laws.
"Environmental Laws": any and all foreign, Federal, state,
local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority
or other Requirements of Law (including common law) regulating,
relating to or imposing liability or standards of conduct concerning
protection of human health or the environment, as now or may at any
time hereafter be in effect.
"ERISA": the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate": the Borrower and (a) any corporation which
is a member of a controlled group of corporations within the meaning of
Section 414(b) of the Code of which the Borrower is a member; (b) any
trade or business (whether or not incorporated) which is a member of a
group of trades or businesses under common control within the meaning
of Section 414(c) of the Code of which the Borrower is a member; and
(c) any member of an affiliated service group within the meaning of
Section 414(m) or (o) of the Code of which the Borrower, any
corporation described in clause (i) above or any trade or business
described in clause (ii) above is a member.
"ERISA Event": (a) the occurrence of a reportable event within
the meaning of Section 4043 of ERISA with respect to any Pension Plan,
(b) a failure to meet the minimum funding standard of Section 412 of
the Code or of Section 302 of ERISA, including, without limitation, the
failure to make on or before its due date a required installment under
Section 412(m) of the Code or Section 302(e) of ERISA, (regardless of
the issuance of any waivers in accordance with Section 412(d) of the
Code) and any request for a waiver under Section 412(d) of the Code in
connection with any Pension Plan; (c) the provision of the
administrator of any Pension Plan of a notice pursuant to Section
4041(a)(2) of ERISA to terminate such plan pursuant to Section 4041(c)
of ERISA; (d) the withdrawal by the Borrower or any ERISA Affiliate
from a Pension Plan during a plan year for which it was a "substantial
employer"
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within the meaning of Section 4001(a)(2) of ERISA; (e) the institution
by the PBGC of proceedings to terminate a Pension Plan pursuant to
Section 4042 of ERISA, or the occurrence of any event or condition
which the Borrower or any ERISA Affiliate reasonably anticipates would
constitute grounds under Section 4042 of ERISA for the termination of,
or the appointment of a trustee to administer, a Pension Plan; (f) the
withdrawal by the Borrower or any ERISA Affiliate in a complete or
partial withdrawal (within the meaning of Section 4203 or 4205 of
ERISA) from a Multiemployer Plan, or the receipt by the Borrower or any
ERISA Affiliate of notice from a Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA
or that it intends to terminate or has terminated under Section 4041A
of ERISA; (g) the imposition on the Borrower or any ERISA Affiliate of
fines, penalties, taxes or related charges under Chapter 43 of the Code
or under Sections 502(c), (i) or (l) or 4071 of ERISA; (h) the
assertion of a material claim (other than routine claims for benefits)
against any Employee Benefit Plan or the assets thereof, or against the
Borrower or any ERISA Affiliate in connection with any such plan; or
(i) receipt from the Service of notice of the failure of any Pension
Plan to qualify under Section 401(a) of the Code, or the failure of any
trust forming part of a Pension Plan to fail to qualify for exemption
from taxation under Section 501(a) of the Code.
"Eurocurrency Reserve Requirements": for any day as applied to
a Eurodollar Loan, the aggregate (without duplication) of the rates
(expressed as a decimal fraction) of reserve requirements in effect on
such day (including, without limitation, basic, supplemental, marginal
and emergency reserves under any regulations of the Board or other
Governmental Authority having jurisdiction with respect thereto)
dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in Regulation D of
the Board) maintained by a member bank of the Federal Reserve System.
"Eurodollar Base Rate": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, the rate per annum
determined by the Agent to be equal to the arithmetic mean of the rates
per annum offered by leading banks in the London interbank market at
approximately 11:00 a.m. (London time) two Working Days prior to the
beginning of such Interest Period, as quoted on Telerate Page 3750 or,
in the event that Telerate Page 3750 shall at such time quote such
rates for fewer than two leading banks, the rate at which the Agent is
offered Dollar deposits at or about 11:00 A.M. (London time), two
Working Days prior to the beginning of such Interest Period in the
London interbank market for delivery on the first day of such Interest
Period for the number of days comprised therein and in an amount
comparable to the amount of the Agent's Eurodollar Loan to be
outstanding during such Interest Period.
"Eurodollar Loans": Loans the rate of interest applicable to
which is based upon the Eurodollar Rate.
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"Eurodollar Rate": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, a rate per annum
determined for such day in accordance with the following formula
(rounded upward to the nearest 1/16th of 1%):
Eurodollar Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"Event of Default": any of the events specified in Section 7,
provided that any requirement for the giving of notice, the lapse of
time, or both, or any other condition, has been satisfied.
"Exchange Assets": those assets that are used or useful in the
operation of the radio stations of PCC listed on Exhibit 5 to the
Letter of Intent.
"Facilities": any and all real property (including, without
limitation, all buildings, fixtures or other improvements located
thereon) now, or hereafter, owned, leased, operated or used by the
Borrower or any of its Subsidiaries or any of their respective
predecessors.
"Federal Funds Rate": with respect to each day, the rate per
annum (rounded upward, if necessary, to the nearest 1/16 of 1%) offered
in the interbank market to the Agent as the overnight "federal funds
rate" at or about 10:00 A.M., Los Angeles time, on such day (or, if
such day is not a Business Day, for the next preceding Business Day).
"Financial Statements": the unaudited consolidated statement
of operations for the Seller for the fiscal years ended December 31,
1995 and December 31, 1996 and the unaudited statement of operations
for the Borrower and its consolidated Subsidiaries for the five months
ended May 31, 1996 and May 31, 1997.
"GAAP": generally accepted accounting principles in the United
States of America consistent with those utilized in preparing the
audited financial statements referred to in subsection 3.3.
"Governmental Authority": any nation or government, any state
or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Hazardous Materials": (a) any chemical, material or substance
defined as or included in the definition of "hazardous substances",
"hazardous wastes", "hazardous materials", "extremely hazardous waste",
"restricted hazardous waste", or "toxic substances" or words of similar
import under any applicable Environmental Laws, (b) any oil, petroleum
or petroleum derived substance, any drilling fluids, produced waters
and other wastes associated with the exploration, development or
production of crude oil, any flammable substances or explosives, any
radioactive materials, any hazardous wastes or substances, any toxic
wastes or substances or any other materials
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or pollutants which (i) pose a material hazard to any property of the
Borrower or any of its Subsidiaries or to Persons on or about such
property or (ii) cause such property to be in violation of any
Environmental Laws, (c) asbestos in any form which is or could become
friable, urea formaldehyde foam insulation, polychlorinated biphenyls,
and (d) any other chemical, material or substance, exposure to which is
prohibited, limited or regulated by any governmental authority or may
or could pose a hazard to the health and safety of the owners,
occupants or any Persons surrounding the Facilities.
"Indebtedness": of any Person at any date, (a) all
indebtedness of such Person for borrowed money or for the deferred
purchase price of property or services (other than current trade
liabilities incurred in the ordinary course of business and payable in
accordance with customary practices), (b) any other indebtedness of
such Person which is evidenced by a note, bond, debenture or similar
instrument, (c) all obligations of such Person under Capital Leases,
(d) all obligations of such Person in respect of acceptances issued or
created for the account of such Person, (e) all liabilities secured by
any Lien on any property owned by such Person even though such Person
has not assumed or otherwise become liable for the payment thereof and
(f) the liquidation value of any preferred capital stock of such Person
its Subsidiaries held by any Person other than such Person and its
wholly owned Subsidiaries.
"Intellectual Property": all patents, trademarks, trade names,
copyrights, technology, know-how and processes used in or necessary for
the conduct of business of the Borrower and its Subsidiaries as
currently conducted that are material to the condition (financial or
other), business, or operations of the Borrower and its Subsidiaries
taken as a whole.
"Interest Payment Date": (a) as to any Base Rate Loan, the
last day of each March, June, September and December and the date on
which such Loan is paid or converted into a Loan of another Type, (b)
as to any Eurodollar Loan having an Interest Period of three months or
less, the last day of such Interest Period, and (c) as to any
Eurodollar Loan having an Interest Period longer than three months,
each day which is three months or a whole multiple thereof, after the
first day of such Interest Period and the last day of such Interest
Period.
"Interest Period": with respect to any Eurodollar Loan:
(a) initially, the period commencing on the borrowing
or conversion date, as the case may be, with respect to such
Eurodollar Loan and ending one, two, three, six or twelve
months thereafter, as selected by the Borrower in its notice
of borrowing or notice of conversion, as the case may be,
given with respect thereto; and
(b) thereafter, each period commencing on the last
day of the next preceding Interest Period applicable to such
Eurodollar Loan and ending one, two, three, six or twelve
months thereafter, as selected by the Borrower by
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irrevocable notice to the Agent not less than three Working
Days prior to the last day of the then current Interest Period
with respect thereto;
provided that if the Borrower at any time selects an Interest Period
with respect to any Eurodollar Loan of twelve months, such selection is
subject to the availability of Eurodollar Loans having an Interest
Period of twelve months on the part of all of the Lenders; provided,
further, all of the foregoing provisions relating to Interest Periods
are subject to the following:
(1) if any Interest Period pertaining to a Eurodollar
Loan would otherwise end on a day that is not a Working Day,
such Interest Period shall be extended to the next succeeding
Working Day unless the result of such extension would be to
carry such Interest Period into another calendar month in
which event such Interest Period shall end on the immediately
preceding Working Day;
(2) any Interest Period pertaining to a Eurodollar
Loan that begins on the last Working Day of a calendar month
(or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period)
shall end on the last Working Day of a calendar month; and
(3) the Borrower shall select Interest Periods with
respect to any Eurodollar Loan so as not to require a payment
or prepayment of any such Eurodollar Loan during an Interest
Period for such Loan.
"Interest Rate Agreement": any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other
similar agreement or arrangement designed to protect the Borrower or
any of its Subsidiaries against fluctuations in interest rates.
"Investment": (a) any direct or indirect purchase or other
acquisition by the Borrower or any of its Subsidiaries of, or a
beneficial interest in, stock or other Securities of any other Person,
or (b) any direct or indirect loan, advance (other than advances to
employees for moving, entertainment and travel expenses, drawing
accounts and similar expenditures in the ordinary course of business)
or capital contribution by the Borrower or any of its Subsidiaries to
any other Person, including all indebtedness and accounts receivable
from that other Person that are not current assets or did not arise
from sales to that other Person in the ordinary course of business. The
amount of any Investment shall be the original cost of such Investment
plus the cost of all additions thereto, without any adjustments for
increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such investment.
"Joint Venture": a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form.
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"Letter of Intent": the Letter of Intent dated as of June 16,
1997 among PCC and Clear Channel.
"Lien": any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge or
other security interest or any preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title
retention agreement and any Capital Lease having substantially the same
economic effect as any of the foregoing).
"Loan Documents": this Agreement, any Notes and the Security
Documents.
"Loan Parties": the Borrower and each Subsidiary of the
Borrower which is a party to a Loan Document.
"Loans": as defined in subsection 2.1.
"Margin Stock": has the meaning assigned to that term in
Regulation U of the Board as in effect from time to time.
"Material Adverse Effect": a material adverse effect on (a)
the business, operations, property, condition (financial or otherwise)
or prospects of the Borrower and its Subsidiaries taken as a whole or
(b) the validity or enforceability of this or any of the other Loan
Documents or the Purchase Documentation or the rights or remedies of
the Agent or the Lenders hereunder or thereunder.
"Multiemployer Plan": a "multiemployer plan" within the
meaning of Section 4001(a)(3) of ERISA to which the Borrower or any
ERISA Affiliate has an obligation to contribute or in respect of which
the Borrower or any ERISA Affiliate has any outstanding liability,
contingent or otherwise.
"Net Cash Proceeds": in connection with:
(a) any asset sale, the proceeds thereof in the form of Cash
and Cash Equivalents (including any such proceeds received by way of
deferred payment of principal pursuant to a note or installment
receivable or purchase price adjustment receivable or otherwise, but
only as and when received), net of attorneys' fees, accountants' fees,
investment banking fees, amounts required to be applied to the
repayment of Indebtedness secured by a Lien expressly permitted
hereunder on any asset which is the subject of such asset sale (other
than any Lien in favor of the Agent for the benefit of the Lenders) and
other customary fees and expenses actually incurred in connection
therewith and net of taxes paid or reasonably estimated to be payable
as a result thereof (after taking into account any available tax
credits or deductions and any tax sharing arrangements); and
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(b) any issuance or sale of equity securities, the Cash
proceeds received from such issuance or sale, net of attorneys' fees,
investment banking fees, accountants' fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred in
connection therewith.
"Non-Excluded Taxes": as defined in subsection 2.15.
"Non-Broadcast Assets": those assets that are used or useful
in the operation of the billboards, radio networks and sports
franchises of PCC listed on Exhibit 1 to the Letter of Intent.
"Notes": the collective reference to the Term Notes and the
Revolving Credit Notes.
"Obligations": the unpaid principal of and interest on
(including, without limitation, interest accruing after the maturity of
the Loans and interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding)
the Notes and all other obligations and liabilities of the Borrower to
the Agent or to any Lender, whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter
incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document, any Interest Rate Agreement entered
into with any Lender, whether on account of principal, interest, fees,
indemnities, costs, expenses (including, without limitation, all fees,
charges and disbursements of counsel to the Agent or to any Lender that
are required to be paid by the Borrower pursuant hereto) or otherwise.
"Operating Lease": as applied to any Person, any lease
(including, without limitation, any leases that may be terminated by
the lessee at any time) of any property (whether real, personal or
mixed) of such Person that is not a Capital Lease other than any such
lease under which such Person is the lessor.
"Participant": as defined in subsection 9.6(b).
"▇▇▇▇▇▇": ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, residing on the date hereof at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇.
"▇▇▇▇▇▇ Pledge Agreement": the Pledge Agreement to be executed
and delivered by ▇▇▇▇▇▇ and Second Crystal, substantially in the form
of Exhibit B-1, as the same may be amended, supplemented or otherwise
modified from time to time.
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"PCC": ▇▇▇▇▇▇ Communications Corporation, a Delaware
corporation.
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"PCC Existing Credit Agreement": the Amended and Restated
Credit Agreement dated as of November 19, 1996 among PCC, Union Bank of
California, N.A., as agent, and the several lenders from time to time
parties thereto as amended in accordance with the terms thereof.
"PCUH": ▇▇▇▇▇▇ Communications Unrestricted Holdings, Inc., a
Delaware corporation, and the direct 100% owner of the Borrower.
"PCUH Pledge Agreement": the Pledge Agreement to be executed
and delivered by PCUH, substantially in the form of Exhibit B-2, as the
same may be amended, supplemented or otherwise modified from time to
time.
"Pension Plan": any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to the provisions of Title IV of
ERISA.
"Permitted Encumbrances": the following types of Liens
(provided that enforcement of the same will not have a Material Adverse
Effect except with respect to clauses (i) and (v) hereof):
(i) Liens for taxes, assessments or governmental charges or
claims the payment of which is not, at the time, required by subsection
5.3;
(ii) Liens of carriers, warehousemen and other liens imposed
by law incurred in the ordinary course of business for sums not yet
delinquent or being contested in good faith, if such reserve or other
appropriate provision, if any, as shall be required by GAAP shall have
been made therefor;
(iii) Liens of mechanics and materialmen for sums not yet due
or the validity of which are being contested in good faith;
(iv) Liens (other than any Lien imposed pursuant to Section
401(a)(29) or Section 412(n) of the Code or under ERISA or any
Environmental Law) incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds,
bids, leases, government contracts, trade contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(v) any attachment or judgment Lien not constituting an
Event of Default under subsection 7(j);
(vi) leases or subleases granted to others not interfering in
any material respect with the business of the Borrower or any of its
Subsidiaries;
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(vii) easements, rights-of-way, restrictions, minor defects,
encroachments or irregularities in title and other similar charges or
encumbrances not interfering in any material respect with the ordinary
conduct of the business of the Borrower or any of its Subsidiaries; and
(vii) Liens arising from filing UCC financing statements
relating solely to leases permitted by this Agreement.
"Person": an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
"Plan": at a particular time, any employee benefit plan which
is covered by ERISA and in respect of which the Borrower or a Commonly
Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as
defined in Section 3(5) of ERISA.
"Pledge Agreements": the collective reference to the ▇▇▇▇▇▇
Pledge Agreement, the PCUH Pledge Agreement, the Borrower Pledge
Agreement and the Subsidiaries Pledge Agreement.
"Purchase Documentation": collectively, the Asset Acquisition
Agreement and all schedules, exhibits, certificates and agreements
entered into in connection therewith, as the same may be amended,
supplemented or otherwise modified in accordance therewith.
"Release": any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal,
leaching, or migration into the indoor or outdoor environment
(including, without limitation, the abandonment or disposal of any
barrels, containers or other closed receptacles containing any
Hazardous Materials), or into or out of any Facility, including the
movement of any Hazardous Material through the air, soil, surface
water, groundwater or property.
"Required Lenders": at a particular time, the holders of at
least 51% of the aggregate unpaid principal amount of the Loans, or, if
no Loans are outstanding, Lenders the Commitment Percentages of which
aggregate at least 51%.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or
any of its property or to which such Person or any of its property is
subject.
"Restricted Payment": means (i) any dividend or other
distribution, direct or indirect, on account of any equity interests
(including preferred capital stock) of the Borrower or any of its
Subsidiaries now or hereafter outstanding, (ii) any redemption,
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retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any equity interests
(including preferred capital stock) of the Borrower or any of its
Subsidiaries now or hereafter outstanding, (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants,
options or other rights to acquire any equity interests (including
preferred capital stock) of the Borrower or any of its Subsidiaries now
or hereafter outstanding and (iv) any direct or indirect payment, loan,
contribution or other transfer of funds or other property to any equity
holder of the Borrower or any of its Subsidiaries.
"Revolving Credit Commitment": as to any Lender, the
obligation of such Lender, if any, to make Revolving Credit Loans to
the Borrower hereunder in an aggregate principal amount not to exceed
the amount set forth under the heading "Revolving Credit Commitment"
opposite such Lender's name on Schedule 1.1, as the same may be changed
from time to time pursuant to the terms hereof.
"Revolving Credit Lender": each Lender which has a Revolving
Credit Commitment or which has made Revolving Credit Loans.
"Revolving Credit Loans": as defined in subsection 2.2(a).
"Revolving Credit Note": as defined in subsection 2.4(e).
"Revolving Credit Percentage": as to any Revolving Credit
Lender at any time, the percentage which such Lender's Revolving Credit
Commitment then constitutes of the aggregate Revolving Credit
Commitments (or, at any time after the Revolving Credit Commitments
shall have expired or terminated, the percentage which the aggregate
principal amount of such Lender's Revolving Credit Loans then
outstanding constitutes of the aggregate principal amount of the
Revolving Credit Loans then outstanding).
"Securities": any stock, shares, voting trust certificates,
bonds, debentures, options, warrants, notes, or other evidences of
indebtedness, secured or unsecured, convertible, subordinated or
otherwise, or in general any instruments commonly known as "securities"
or any certificates of interest, shares or participations in temporary
or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"Second Crystal": Second ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited Partnership,
a Nevada limited partnership, of which at least 99% of the equity
interests are owned directly or indirectly by ▇▇▇▇▇▇, and of which the
sole general partners are ▇▇▇▇▇▇ Enterprises, Inc., a Nevada
corporation, and ▇▇▇▇▇▇, and of which the sole limited partner is
▇▇▇▇▇▇, as Trustee for the ▇▇▇▇▇▇ Family Trust, having its address c/o
▇▇▇▇ ▇. ▇▇▇▇▇ III, Esquire, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇.
"Security Agreements": the collective reference to the
Borrower Security Agreement and the Subsidiaries Security Agreement.
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"Security Documents": the collective reference to the Pledge
Agreements, the Subsidiaries Guarantee, the Security Agreements and all
other security documents hereafter delivered to the Agent granting a
Lien on any asset or assets of any Person to secure the obligations and
liabilities of the Borrower hereunder and under any of the other Loan
Documents or to secure any guarantee of any such obligations and
liabilities.
"Seller": The Travel Channel, Inc., a Virginia corporation.
"Solvent": with respect to any Person, that as of the date of
determination, both (A) (i) the then fair saleable value of the
property of such Person is (y) greater than the total amount of
liabilities (including Contingent Obligations) of such Person and (z)
greater than the amount that will be required to pay the probable
liabilities of such Person's then existing debts as they become
absolute and matured considering all financing alternatives, sharing
and allocation arrangements and potential asset sales reasonably
available to such Person; (ii) such Person's capital is not
unreasonably small in relation to its business or any contemplated or
undertaken transaction; and (iii) such Person does not intend to incur,
or believe or reasonably should believe that it will incur, debts
beyond its ability to pay such debts as they become due and (B) such
Person is solvent within the meaning given that term and similar terms
under applicable laws relating to fraudulent transfers.
"Subsidiaries Guarantee": the Guarantee to be executed and
delivered by each Subsidiary in favor of the Agent, substantially in
the form of Exhibit D, as the same may be amended, supplemented or
otherwise modified from time to time.
"Subsidiaries Pledge Agreement": the Subsidiaries Pledge
Agreement to be executed and delivered by each Subsidiary in favor of
the Agent, substantially in the form of Exhibit E, as the same may be
amended, supplemented or otherwise modified from time to time.
"Subsidiaries Security Agreement": the Subsidiaries Security
Agreement to be executed and delivered by each Subsidiary in favor of
the Agent, substantially in the form of Exhibit F, as the same may be
amended, supplemented or otherwise modified from time to time.
"Subsidiaries Security Documents": the collective reference to
the Subsidiaries Pledge Agreement and the Subsidiaries Security
Agreement.
"Subsidiary": as to any Person, a corporation, partnership or
other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other
managers of such corporation, partnership or other entity are at the
time owned, or the management of which is otherwise controlled,
directly or indirectly through one or more intermediaries, or both, by
such Person. Unless otherwise qualified, all
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references to a "Subsidiary" or to "Subsidiaries" in this Agreement
shall refer to a Subsidiary or Subsidiaries of the Borrower.
"Subsidiary Guarantor": any Subsidiary of the Borrower that is
a party to the Subsidiaries Guarantee.
"Termination Date": June 30, 1998.
"Term Loan": as defined in subsection 2.1(a).
"Term Loan Commitment": as to any Lender, the obligation of
such Lender, if any, to make a Term Loan to the Borrower hereunder in
an aggregate principal amount not to exceed the amount set forth under
the heading "Term Loan Commitment" opposite such Lender's name on
Schedule 1.1, as the same may be changed from time to time pursuant to
the terms hereof.
"Term Loan Lender": each Lender which has a Term Loan
Commitment or which has made a Term Loan.
"Term Loan Percentage": as to any Term Loan Lender at any
time, the percentage which such Lender's Term Loan Commitment then
constitutes of the aggregate Term Loan Commitments (or, at any time
after the Term Loan Commitments shall have expired or terminated, the
percentage which the aggregate principal amount of such Lender's Term
Loans then outstanding constitutes of the aggregate principal amount of
the Term Loans then outstanding).
"Term Note": as defined in subsection 2.4(e).
"The Travel Channel": The Travel Channel, a cable television
network providing viewers in the United States with programming
relating to leisure travel and related topics through original,
co-produced, and acquired non-fiction programming (as further defined
in the Purchase Documentation).
"Tranche": the collective reference to Eurodollar Loans the
then current Interest Periods with respect to all of which begin on the
same date and end on the same later date (whether or not such Loans
shall originally have been made on the same day).
"Transferee": as defined in subsection 9.6(f).
"Type": as to any Loan, its nature as a Base Rate Loan or a
Eurodollar Loan.
"Warrants": each of the warrants to purchase shares of common
stock or preferred capital stock of the Borrower.
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"Working Day": shall mean any Business Day on which dealings
in foreign currencies and exchange between banks may be carried on in
London, England.
1.2 Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in any Notes or any certificate or other document made or delivered
pursuant hereto.
(b) As used herein and in any Notes, and any certificate or other
document made or delivered pursuant hereto, accounting terms relating to the
Borrower and its Subsidiaries not defined in subsection 1.1 and accounting terms
partly defined in subsection 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, subsection,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
SECTION 2. AMOUNT AND TERMS OF TERM LOANS AND REVOLVING CREDIT COMMITMENTS
2.1 Term Loan. (a) Subject to the terms and conditions hereof, each
Term Loan Lender severally agrees to make term loans ("Term Loans") to the
Borrower from time to time during the Commitment Period in an aggregate
principal amount at any one time outstanding not to exceed the amount of such
Term Loan Lender's Term Loan Commitment; provided that $20,000,000 of such term
loans shall only be available to the Borrower on the Closing Date and the
remaining $2,000,000 of term loans shall be available to the Borrower during the
Commitment Period solely to pay interest on the due date thereof on the Loans as
required hereunder.
(b) The Term Loans may from time to time be (i) Eurodollar Loans or
(ii) Base Rate Loans or (iii) a combination thereof, as determined by the
Borrower and notified to the Agent in accordance with subsections 2.1(c) and
2.7, provided that no Term Loan shall be made as a Eurodollar Loan after the day
that is one month prior to the Termination Date.
(c) The Borrower may borrow during the Commitment Period in accordance
with the proviso to subsection 2.1(a) on any Working Day, if all or any part of
such Term Loans are to be initially Eurodollar Loans, or on a Business Day, if
all of such Term Loans are to be initially Base Rate Loans, provided that the
Borrower shall give the Agent irrevocable notice (which notice must be received
by the Agent prior to 10:00 A.M., Los Angeles time, (a) three Business Days
prior to the requested Borrowing Date, if all or any part of the requested Term
Loans are to be initially Eurodollar Loans or (b) one Business Day prior to the
requested Borrowing Date, otherwise), specifying (i) the amount to be borrowed,
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(ii) the requested Borrowing Date, (iii) whether the borrowing is to be
Eurodollar Loans, Base Rate Loans, or a combination thereof and (iv) if the
borrowing is to be entirely or partly of Eurodollar Loans, the respective
amounts of each such Type of Loan and the respective lengths of the initial
Interest Periods therefor. Each borrowing under the Term Loan Commitments shall
be in an amount equal to (x) in the case of Base Rate Loans, $500,000 or a whole
multiple of $100,000 in excess thereof (or such lesser amount as may be agreed
to by the Agent) and (y) in the case of Eurodollar Loans, $3,000,000 or a whole
multiple of $1,000,000 in excess thereof. Upon receipt of any such notice from
the Borrower, the Agent shall promptly notify each Term Loan Lender thereof.
Each Term Loan Lender will make the amount of its pro rata share of each
borrowing available to the Agent for the account of the Borrower at the office
of the Agent specified in subsection 9.2 prior to 11:00 A.M., New York City
time, on the Borrowing Date requested by the Borrower in funds immediately
available to the Agent. Such borrowing will then be made available to the
Borrower by the Agent crediting the account of the Borrower on the books of such
office with the aggregate of the amounts made available to the Agent by the Term
Loan Lenders and in like funds as received by the Agent.
2.2 Revolving Credit Commitments. (a) Subject to the terms and
conditions hereof, each Revolving Credit Lender severally agrees to make
revolving credit loans ("Revolving Credit Loans") to the Borrower from time to
time during the Commitment Period in an aggregate principal amount at any one
time outstanding not to exceed the amount of such Revolving Credit Lender's
Revolving Credit Commitment. During the Commitment Period the Borrower may use
the Revolving Credit Commitments by borrowing, prepaying the Revolving Credit
Loans in whole or in part, and reborrowing, all in accordance with the terms and
conditions hereof.
(b) The Revolving Credit Loans may from time to time be (i) Eurodollar
Loans or (ii) Base Rate Loans or (iii) a combination thereof, as determined by
the Borrower and notified to the Agent in accordance with subsections 2.2(c) and
2.7, provided that no Revolving Credit Loan shall be made as a Eurodollar Loan
after the day that is one month prior to the Termination Date.
(c) The Borrower may borrow under the Revolving Credit Commitments
during the Commitment Period on any Working Day, if all or any part of such
Loans are to be initially Eurodollar Loans, or on a Business Day, if all of such
Revolving Credit Loans are to be initially Base Rate Loans, provided that the
Borrower shall give the Agent irrevocable notice (which notice must be received
by the Agent prior to 10:00 A.M., Los Angeles time, (a) three Business Days
prior to the requested Borrowing Date, if all or any part of the requested
Revolving Credit Loans are to be initially Eurodollar Loans or (b) one Business
Day prior to the requested Borrowing Date, otherwise), specifying (i) the amount
to be borrowed, (ii) the requested Borrowing Date, (iii) whether the borrowing
is to be Eurodollar Loans, Base Rate Loans, or a combination thereof and (iv) if
the borrowing is to be entirely or partly of Eurodollar Loans, the respective
amounts of each such Type of Loan and the respective lengths of the initial
Interest Periods therefor. Each borrowing under the Revolving Credit Commitments
shall be in an amount equal to (x) in the case of Base Rate Loans, $100,000 or a
whole multiple of $100,000 in excess thereof (or, if the then aggregate
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Available Commitments are less than $100,000, such lesser amount) and (y) in the
case of Eurodollar Loans, $100,000 or a whole multiple of $100,000 in excess
thereof. Upon receipt of any such notice from the Borrower, the Agent shall
promptly notify each Revolving Credit Lender thereof. Each Revolving Credit
Lender will make the amount of its pro rata share of each borrowing available to
the Agent for the account of the Borrower at the office of the Agent specified
in subsection 9.2 prior to 11:00 A.M., New York City time, on the Borrowing Date
requested by the Borrower in funds immediately available to the Agent. Such
borrowing will then be made available to the Borrower by the Agent crediting the
account of the Borrower on the books of such office with the aggregate of the
amounts made available to the Agent by the Revolving Credit Lenders and in like
funds as received by the Agent.
2.3 Commitment Fee. The Borrower agrees to pay to the Agent for the
account of each Lender a commitment fee for the duration of the Commitment
Period from and including the first day of the Commitment Period, computed at a
rate per annum equal to .50% on the average daily amount of the Available
Revolving Credit Commitment of such Lender during the period for which payment
is made, payable quarterly in arrears on the last day of each March, June,
September and December and on the Termination Date or such earlier date as the
Commitments shall terminate as provided herein, commencing on the first of such
dates to occur after the date hereof.
2.4 Repayment of Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay to the Agent for the account of the appropriate
Lender: (i) the then unpaid principal amount of each Revolving Credit Loan of
such Revolving Credit Lender on the Termination Date (or such earlier date on
which the Revolving Credit Loans become due and payable pursuant to Section 7)
and (ii) the principal amount of the Term Loans of such Term Loan Lender on the
Termination Date (or on such earlier date on which the then unpaid principal
amount of the Term Loans become due and payable pursuant to Section 7). The
Borrower hereby further agrees to pay interest on the unpaid principal amount of
the Loans from time to time outstanding from the date hereof until payment in
full thereof at the rates per annum, and on the dates, set forth in subsection
2.9.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Borrower to such Lender
resulting from each Loan of such Lender from time to time, including the amounts
of principal and interest payable and paid to such Lender from time to time
under this Agreement.
(c) The Agent shall maintain the Register pursuant to subsection
9.6(d), and a subaccount therein for each Lender, in which shall be recorded (i)
the amount of each Revolving Credit Loan and Term Loan made hereunder, the Type
thereof and each Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) both the amount of any sum received
by the Agent hereunder from the Borrower and each Lender's share thereof.
(d) The entries made in the Register and the accounts of each Lender
maintained pursuant to subsection 2.4(b) shall, to the extent permitted by
applicable law, be
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prima facie evidence of the existence and amounts of the obligations of the
Borrower therein recorded; provided, however, that the failure of any Lender or
the Agent to maintain the Register or any such account, or any error therein,
shall not in any manner affect the obligation of the Borrower to repay (with
applicable interest) the Loans made to the Borrower by such Lender in accordance
with the terms of this Agreement.
(e) The Borrower agrees that, upon the request to the Agent by any
Lender, the Borrower will execute and deliver to such Lender (i) a promissory
note of the Borrower evidencing any Revolving Credit Loans of such Lender,
substantially in the form of Exhibit A-1 with appropriate insertions as to date
and principal amount (a "Revolving Credit Note"), and/or (ii) a promissory note
of the Borrower evidencing any Term Loan of such Lender, substantially in the
form of Exhibit A-2 with appropriate insertions as to date and principal amount
(a "Term Note").
2.5 Optional Prepayments. The Borrower may, at any time and from time
to time, prepay the Loans, in whole or in part, without premium or penalty, upon
at least three Business Days' irrevocable notice to the Agent in the case of
Eurodollar Loans, and upon at least one Business Days' irrevocable notice to the
Agent in the case of Base Rate Loans, specifying the date and amount of
prepayment and whether the prepayment is of Eurodollar Loans, Base Rate Loans or
a combination thereof, and, if of a combination thereof, the amount allocable to
each. Upon receipt of any such notice the Agent shall promptly notify each
Lender thereof. If any such notice is given, the amount specified in such notice
shall be due and payable on the date specified therein, together with any
amounts payable pursuant to subsection 2.16. Partial prepayments shall be in an
aggregate principal amount of $250,000 or a whole multiple of $50,000 in excess
thereof. Partial prepayments of the Term Loans may not be reborrowed.
2.6 Mandatory Prepayments. If permitted by the PCC Existing Credit
Agreement, the Term Loans shall be prepaid and the Revolving Credit Commitments
reduced by an amount equal to the aggregate Net Cash Proceeds of (i) the sale of
Non-Broadcast Assets to Clear Channel, (ii) the sale of the Exchange Assets to
Clear Channel (if the Net Cash Proceeds thereof are not reinvested within six
months in a like-kind exchange pursuant to Section 1031 of the Internal Revenue
Code) or (iii) the issuance or sale by PCC of equity securities. Any prepayment
of the Loans shall include accrued interest and any amounts due pursuant to
subsection 2.16. Any reduction of the Revolving Credit Commitments pursuant to
this subsection 2.6 shall be accompanied by the prepayment of the Revolving
Credit Loans to the extent, if any, that the aggregate then outstanding
principal amount of the Revolving Credit Loans exceeds the amount of the
Revolving Credit Commitments as so reduced.
2.7 Conversion and Continuation Options. (a) The Borrower may elect
from time to time to convert Eurodollar Loans to Base Rate Loans, by giving the
Agent at least two Business Days' prior irrevocable notice of such election,
provided that any such conversion of Eurodollar Loans may only be made on the
last day of an Interest Period with respect thereto. The Borrower may elect from
time to time to convert Base Rate Loans to Eurodollar Loans by giving the Agent
at least three Working Days' prior irrevocable notice of such election. Any such
notice of conversion to Eurodollar Loans shall specify the length of
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the initial Interest Period or Interest Periods therefor. Upon receipt of any
such notice the Agent shall promptly notify each Lender thereof. All or any part
of outstanding Eurodollar Loans and Base Rate Loans may be converted as provided
herein, provided that (i) no Loan may be converted into a Eurodollar Loan when
any Event of Default has occurred and is continuing and the Agent has or the
Required Lenders have determined that such a conversion is not appropriate and
(ii) no Loan may be converted into a Eurodollar Loan after the date that is one
month prior to the Termination Date.
(b) Any Eurodollar Loans may be continued as such upon the expiration
of the then current Interest Period with respect thereto by the Borrower giving
notice to the Agent, in accordance with the applicable provisions of the term
"Interest Period" set forth in subsection 1.1, of the length of the next
Interest Period to be applicable to such Loans, provided that no Eurodollar Loan
may be continued as such (i) when any Event of Default has occurred and is
continuing and the Agent has or the Required Lenders have determined that such a
continuation is not appropriate or (ii) after the date that is one month prior
to the Termination Date and provided, further, that if the Borrower shall fail
to give such notice or if such continuation is not permitted such Loans shall be
automatically converted to Base Rate Loans on the last day of such then expiring
Interest Period.
2.8 Minimum Amounts and Maximum Number of Tranches. All borrowings,
conversions and continuations of Loans hereunder and all selections of Interest
Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, the aggregate principal amount
of the Loans comprising each Eurodollar Tranche shall be equal to $1,000,000 or
a whole multiple of $1,000,000 in excess thereof. In no event shall there be
more than 5 Eurodollar Tranches outstanding at any time.
2.9 Interest Rates and Payment Dates. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurodollar Rate determined with respect to such Loan
for such day plus the Applicable Margin.
(b) Each Base Rate Loan shall bear interest at a rate per annum equal
to the Base Rate plus the Applicable Margin.
(c) If all or a portion of (i) any principal of any Loan, (ii) any
interest payable thereon, (iii) any commitment fee or (iv) any other amount
payable hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), the principal of such overdue Loans and any such
overdue interest, commitment fee or other amount shall bear interest at a rate
per annum which is (x) in the case of principal, the rate that would otherwise
be applicable thereto pursuant to the foregoing provisions of this subsection
plus 2% or (y) in the case of any such overdue interest, commitment fee or other
amount, the rate described in paragraph (b) of this subsection plus 2%, in each
case from the date of such non-payment until such overdue principal, interest,
commitment fee or other amount is paid in full (as well after as before
judgment).
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(d) Interest shall be payable in arrears on each Interest Payment Date,
provided that interest accruing pursuant to paragraph (c) of this subsection
shall be payable from time to time on demand.
2.10 Computation of Interest and Fees. (a) Interest on Base Rate Loans
and facility fees shall be calculated on the basis of a 365- (or 366-, as the
case may be) day year for the actual days elapsed. Interest on Eurodollar Loans
shall be calculated on the basis of a 360-day year for the actual days elapsed.
The Agent shall as soon as practicable notify the Borrower and the Lenders of
each determination of a Eurodollar Rate. Any change in the interest rate on a
Loan resulting from a change in the Base Rate or the Eurocurrency Reserve
Requirements shall become effective as of the opening of business on the day on
which such change becomes effective. The Agent shall as soon as practicable
notify the Borrower and the Lenders of the effective date and the amount of each
such change in interest rate.
(b) Each determination of an interest rate by the Agent pursuant to any
provision of this Agreement shall be conclusive and binding on the Borrower and
the Lenders in the absence of manifest error. The Agent shall, at the request of
the Borrower, deliver to the Borrower a statement showing the quotations used by
the Agent in determining any interest rate pursuant to subsection 2.9(a) or (b).
2.11 Inability to Determine Interest Rate. If prior to the first day of
any Interest Period:
(a) the Agent shall have determined (which determination shall
be conclusive and binding upon the Borrower) that, by reason of
circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the Eurodollar Rate for such
Interest Period, or
(b) the Agent shall have received notice from the Required
Lenders that the Eurodollar Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to
such Lenders (as conclusively certified by such Lenders) of making or
maintaining their affected Loans during such Interest Period,
the Agent shall give telecopy or telephonic notice thereof to the Borrower and
the Lenders as soon as practicable thereafter. If such notice is given (x) any
Eurodollar Loans requested to be made on the first day of such Interest Period
shall be made as Base Rate Loans, (y) any Loans that were to have been converted
on the first day of such Interest Period to Eurodollar Loans shall be continued
as Base Rate Loans and (z) any affected outstanding Eurodollar Loans shall be
converted, on the first day of such Interest Period, to Base Rate Loans. Until
such notice has been withdrawn by the Agent, no further Eurodollar Loans shall
be made or continued as such, nor shall the Borrower have the right to convert
Loans to Eurodollar Loans.
2.12 Pro Rata Treatment and Payments. (a) Each borrowing by the
Borrower from the Lenders hereunder, each payment by the Borrower on account of
any facility fee and any reduction of the Commitments of the Lenders shall be
made pro rata according to the
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respective Term Loan Percentages or Revolving Credit Percentages, as the case
may be, of the relevant Lenders. Each payment (including each prepayment) by the
Borrower on account of principal of and interest on the Term Loans shall be made
pro rata according to the respective outstanding principal amounts of the Term
Loans then held by the Term Loan Lenders. Each payment (including each
prepayment) by the Borrower on account of principal of and interest on the
Revolving Credit Loans shall be made pro rata according to the respective
outstanding principal amounts of the Revolving Credit Loans then held by the
Revolving Credit Lenders. All payments (including prepayments) to be made by the
Borrower hereunder, whether on account of principal, interest, fees or
otherwise, shall be made without set off or counterclaim and shall be made prior
to 11:00 A.M. Los Angeles time, on the due date thereof to the Agent, for the
account of the Lenders, at the Agent's office specified in subsection 9.2, in
Dollars and in immediately available funds. The Agent shall distribute such
payments to the Lenders promptly upon receipt in like funds as received. If any
payment hereunder becomes due and payable on a day other than a Business Day,
such payment shall be extended to the next succeeding Business Day, and, with
respect to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension.
(b) Unless the Agent shall have been notified in writing by any Lender
prior to a borrowing that such Lender will not make the amount that would
constitute its applicable Commitment Percentage of such borrowing available to
the Agent, the Agent may assume that such Lender is making such amount available
to the Agent, and the Agent may, in reliance upon such assumption, make
available to the Borrower a corresponding amount. If such amount is not made
available to the Agent by the required time on the Borrowing Date therefor, such
Lender shall pay to the Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Rate for the period until such
Lender makes such amount immediately available to the Agent. A certificate of
the Agent submitted to any Lender with respect to any amounts owing under this
subsection shall be conclusive in the absence of manifest error. If such
Lender's applicable Commitment Percentage of such borrowing is not made
available to the Agent by such Lender within three Business Days of such
Borrowing Date, the Agent shall also be entitled to recover such amount with
interest thereon, without duplication of any amounts received by the Agent from
such Lender, at the rate per annum applicable to Base Rate Loans hereunder, on
demand, from the Borrower.
2.13 Illegality. Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such
Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Base Rate Loans to Eurodollar Loans shall forthwith be cancelled and (b)
such Lender's Loans then outstanding as Eurodollar Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days of the
then current Interest Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a Eurodollar Loan occurs on
a day which is not the last day of the then current Interest Period with respect
thereto, other than as a result of the gross negligence or willful act of such
Lender, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to subsection 2.16.
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2.14 Requirements of Law. (a) If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority made subsequent to
the date hereof:
(i) shall subject any Lender to any tax of any kind
whatsoever with respect to this Agreement, any Note or any Eurodollar
Loan made by it, or change the basis of taxation of payments to such
Lender in respect thereof (except for Non- Excluded Taxes covered by
subsection 2.15 and changes in the rate of tax on the overall net
income of such Lender);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Eurodollar Rate
thereunder; or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or to reduce any amount receivable
hereunder in respect thereof, then, in any such case, such Lender shall notify
the Borrower of such increased cost or reduced amount receivable and describe in
reasonable detail the basis for such notification, and the Borrower shall
promptly pay such Lender such additional amount or amounts as will compensate
such Lender for such increased cost or reduced amount receivable.
(b) If any Lender shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the date hereof shall have the effect of reducing
the rate of return on such Lender's or such corporation's capital as a
consequence of its obligations hereunder to a level below that which such Lender
or such corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such corporation's
policies with respect to capital adequacy) by an amount deemed by such Lender to
be material, then from time to time, the Borrower shall promptly pay to such
Lender such additional amount or amounts as will compensate such Lender for such
reduction.
(c) If any Lender becomes entitled to claim any additional amounts
pursuant to this subsection, it shall promptly notify the Borrower (with a copy
to the Agent) of the event by reason of which it has become so entitled. A
certificate as to any additional amounts payable pursuant to this subsection
submitted by such Lender to the Borrower (with a copy to the Agent) shall be
conclusive in the absence of manifest error. The agreements in
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this subsection shall survive the termination of this Agreement and the payment
of the Loans and all other amounts payable hereunder.
(d) In the event any Lender delivers a certificate requesting
compensation pursuant to this subsection 2.14, the Borrower may, at its sole
expense and effort, upon notice to such Lender and the Agent, require such
Lender to transfer and assign, without recourse (in accordance with and subject
to the restrictions contained in subsection 9.6), all of its interests, rights
and obligations under this Agreement to an assignee which shall assume such
assigned obligations (which assignee may be another Lender, if a Lender accepts
such assignment); provided, however, that (x) such assignment shall not conflict
with any law, rule or regulation or order of any court or other Governmental
Authority having jurisdiction, (y) the Borrower shall have received the prior
written consent to such assignment of the Agent, which consent shall not
unreasonably be withheld, and (z) the Borrower or such assignee shall have paid
to the affected Lender in immediately available funds an amount equal to the sum
of the principal of the outstanding Loans of such Lender plus all interest, fees
and other amounts accrued and unpaid for the account of such Lender hereunder
(including any amounts under this subsection 2.14); provided, further, that if
prior to any such transfer and assignment the circumstances or event that
resulted in such Lender's claim for compensation under this subsection 2.14
cease to cause such Lender to suffer increased costs or reductions in amounts
received or receivable or reduction in return on capital (including as a result
of any action taken by such Lender pursuant to subsection 2.17), or if, within
twenty days after the Borrower shall have notified such Lender of its election
to exercise its rights pursuant to this subsection, such Lender shall waive its
right to claim further compensation under this subsection 2.14 in respect of
such circumstances or event, then such Lender shall not thereafter be required
to make any such transfer and assignment hereunder.
2.15 Taxes. (a) All payments made by the Borrower under this Agreement
and any Notes shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding net income taxes and franchise taxes (imposed
in lieu of net income taxes) imposed on the Agent or any Lender as a result of a
present or former connection between the Agent or such Lender and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Agent or such Lender having executed,
delivered or performed its obligations or received a payment under, or enforced,
this Agreement or any Note). If any such non-excluded taxes, levies, imposts,
duties, charges, fees deductions or withholdings ("Non-Excluded Taxes") are
required to be withheld from any amounts payable to the Agent or any Lender
hereunder or under any Note, the amounts so payable to the Agent or such Lender
shall be increased to the extent necessary to yield to the Agent or such Lender
(after payment of all Non-Excluded Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in this Agreement,
provided, however, that the Borrower shall not be required to increase any such
amounts payable to any Lender that is not organized under the laws of the United
States of America or a state thereof if such Lender fails to comply with the
requirements of paragraph (b) of this subsection. Whenever any Non-Excluded
Taxes are
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payable by the Borrower, as promptly as possible thereafter the Borrower shall
send to the Agent for its own account or for the account of such Lender, as the
case may be, a certified copy of an original official receipt received by the
Borrower showing payment thereof. If the Borrower fails to pay any Non-Excluded
Taxes when due to the appropriate taxing authority or fails to remit to the
Agent the required receipts or other required documentary evidence, the Borrower
shall indemnify the Agent and the Lenders for any incremental taxes, interest or
penalties that may become payable by the Agent or any Lender as a result of any
such failure. The agreements in this subsection shall survive the termination of
this Agreement and the payment of the Loans and all other amounts payable
hereunder.
(b) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:
(i) deliver to the Borrower and the Agent (A) two duly
completed copies of United States Internal Revenue Service Form 1001 or
4224, or successor applicable form, as the case may be, and (B) an
Internal Revenue Service Form W-8 or W-9, or successor applicable form,
as the case may be;
(ii) deliver to the Borrower and the Agent two further copies
of any such form or certification on or before the date that any such
form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and complete
such forms or certifications as may reasonably be requested by the
Borrower or the Agent;
unless in any such case an event (including, without limitation, any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and delivering any such
form with respect to it and such Lender so advises the Borrower and the Agent.
Such Lender shall certify (i) in the case of a Form 1001 or 4224, that it is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes and (ii) in the case of a
Form W-8 or W-9, that it is entitled to an exemption from United States backup
withholding tax. Each Person that shall become a Lender or a Participant
pursuant to subsection 9.6 shall, upon the effectiveness of the related
transfer, be required to provide all of the forms and statements required
pursuant to this subsection, provided that in the case of a Participant such
Participant shall furnish all such required forms and statements to the Lender
from which the related participation shall have been purchased.
2.16 Indemnity. The Borrower agrees to indemnify each Lender and to
hold each Lender harmless from any loss or expense which such Lender may sustain
or incur as a consequence of (a) default by the Borrower in making a borrowing
of, conversion into or continuation of Eurodollar Loans after the Borrower has
given a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment after the
Borrower has given a notice thereof in accordance with the provisions of
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this Agreement or (c) the making of a prepayment of Eurodollar Loans on a day
which is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to the excess, if any, of (i) the
amount of interest which would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow, convert or
continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Loans provided
for herein (excluding, however, the Applicable Margin included therein, if any)
over (ii) the amount of interest (as reasonably determined by such Lender) which
would have accrued to such Lender on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank eurodollar
market. This covenant shall survive the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.
2.17 Change of Lending Office. Each Lender agrees that if it makes any
demand for payment under subsection 2.14 or 2.15(a), or if any adoption or
change of the type described in subsection 2.13 shall occur with respect to it,
it will use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions and so long as such efforts would not be
disadvantageous to it, as determined in its sole discretion) to designate a
different lending office if the making of such a designation would reduce or
obviate the need for the Borrower to make payments under subsection 2.14 or
2.15(a), or would eliminate or reduce the effect of any adoption or change
described in subsection 2.13.
2.18 Further Assurances Regarding Security. (a) The Borrower shall, and
shall cause each of its Subsidiaries to, from time to time, execute and deliver
to the Agent on behalf of the Lenders, such additional Security Documents,
statements, documents, agreements and reports as it may from time to time
reasonably request to evidence, perfect or otherwise implement or assure the
security for repayment of the Obligations. With respect to the Lenders'
insurance policies, upon the Agent's reasonable request, the Borrower shall
arrange for co-insurance and/or reinsurance, with companies and in amounts
satisfactory to the Agent. All reinsurance policies shall include direct access
agreements acceptable to the Agent.
(b) The Borrower shall, and shall cause each of its Subsidiaries to,
execute and deliver such further documents (including without limitation such
financing statements, continuation statements or amendments thereto and such
other documents and certificates as the Agent may reasonably request to perfect
and preserve the security interests granted or purported to be granted under any
of the Security Documents) and do such other acts and things as the Agent may
reasonably request to effect fully the purposes of this Agreement and the other
Loan Documents and to provide for payment of the Obligations in accordance with
the terms of this Agreement and the other Loan Documents. Without limiting any
of the foregoing, in the event a Person becomes a Subsidiary of the Borrower
after the Closing Date, the Borrower shall cause such Subsidiary to execute and
deliver such guarantees, Security Documents and such other agreements, pledges,
assignments, documents and certificates (including, without limitation, any
amendments to the Loan Documents) as the Agent may reasonably request and do
such other acts and things as the Agent may reasonably request to
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have such Subsidiary guaranty the Obligations, grant to the Agent on behalf of
Lenders, a duly perfected first priority Lien (subject to Liens permitted
hereunder) on all real, personal and mixed property of such Subsidiary, and
effect fully the purposes of this Agreement and the other Loan Documents and to
provide for payment of the Obligations in accordance with the terms of this
Agreement and the other Loan Documents. Without limiting the generality of the
foregoing, in the event the Borrower forms or otherwise acquires a Subsidiary
after the Closing Date, the Borrower shall (i) execute and deliver to the Agent
a pledge agreement substantially in the form attached hereto as Exhibit B and
(ii) cause such Subsidiary to execute and deliver a guarantee substantially in
the form attached hereto as Exhibit E, a pledge agreement substantially in the
form attached hereto as Exhibit E and a security agreement in the form of
Exhibit F.
SECTION 3. REPRESENTATIONS AND WARRANTIES
To induce the Agent and the Lenders to enter into this Agreement and to
make the Loans, the Borrower hereby represents and warrants to the Agent and
each Lender that:
3.1 Organization, Powers, Good Standing and Business
(a) Organization and Powers. Each Loan Party is a corporation or
limited partnership, as the case may be, duly formed and validly existing under
the laws of the jurisdiction of its organization. Each Loan Party has all
requisite corporate or partnership, as the case may be, power and authority to
own and operate its properties, to carry on its business as now conducted and
proposed to be conducted, and each Loan Party has all requisite corporate or
partnership, as the case may be, power and authority to enter into the Loan
Documents and the Purchase Documentation, to carry out the transactions
contemplated thereby and to issue the Notes, in each case to the extent it is a
party thereto.
(b) Good Standing. Each Loan Party is in good standing in every
jurisdiction where its assets are located and wherever necessary to carry out
its present business and operations, except where the failure to be so qualified
has not had and could not reasonably be expected to have a Material Adverse
Effect.
(c) Conduct of Business. The Loan Parties are engaged only in the
businesses permitted to be engaged in under subsection 6.11 and are conducting
their businesses in accordance with the provisions of subsection 6.11. Each Loan
Party holds all licenses, permits, franchises, leases, certificates of
authority, or any waivers of the foregoing that are necessary to permit each of
them to conduct their respective businesses as now conducted and to hold and
operate their respective properties, except where the failure to have such
licenses, permits, franchises, leases and certificates of authority, or waivers
of any of the foregoing, could not reasonably be expected to have a Material
Adverse Effect. All such licenses, permits, franchises, leases, certificates of
authority and waivers are valid and in full force and effect, except where the
failure to be in full force and effect of such licenses, permits, franchises,
leases, certificates of authority and waivers could not reasonably be expected
to have a Material Adverse Effect.
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(d) Ownership and Subsidiaries. The ownership of each of the Loan
Parties is specified correctly and completely on Schedule 3.1(d) annexed hereto.
None of the Capital Stock of the Persons identified on Schedule 3.1(d) annexed
hereto is Margin Stock, except as specified on such Schedule.
(e) Real Property. Schedule 3.1(e) accurately states all material real
property interests held by the Loan Parties.
3.2 Authorization of Borrowing, etc.
(a) Authorization of Borrowing. The execution, delivery and performance
of the Loan Documents and the issuance, delivery and payment of the Notes have
been duly authorized by all necessary corporate or partnership, as the case may
be, action by each Loan Party a party thereto.
(b) No Conflict. The execution, delivery and performance by each Loan
Party of the Loan Documents and the Purchase Documentation the issuance,
delivery and performance of the Notes and any other transaction contemplated by
the Loan Documents do not and will not (i) violate any provision of law
applicable to any Loan Party, the Certificate of Incorporation, Bylaws,
Partnership Agreement or other organizational documents of any Loan Party or any
order, judgment or decree of any court or other agency of government binding on
any Loan Party, (ii) conflict with, result in a breach of or constitute (with
due notice or lapse of time or both) a default under any material Contractual
Obligation of any Loan Party, (iii) result in or require the creation or
imposition of any material Lien upon any of the properties or assets of any Loan
Party (other than Liens hereunder in favor of the Agent on behalf of the
Lenders) or (iv) require any approval of stockholders or other equity holders or
any approval or consent of any Person under any Contractual Obligation of any
Loan Party.
(c) Governmental Consents. The execution, delivery and performance by
each Loan Party of the Loan Documents to which it is a party, the issuance,
delivery and performance of the Notes and any other transactions contemplated by
the Loan Documents (including the sale and purchase of substantially all of the
assets of The Travel Channel pursuant to the Purchase Documentation) do not and
will not require any registration with, consent or approval of, or notice to, or
other action to, with or by, any federal, state or other governmental authority
or regulatory body.
(d) Binding Obligation. Each of the Loan Documents has been duly
executed and delivered by each Loan Party which is a party thereto, and is the
legally valid and binding obligation of such Loan Party, enforceable against
such Loan Party in accordance with their respective terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally and subject to the
availability of equitable remedies. The Purchase Documentation has been duly
executed by PCC and is the legally valid and binding obligation of PCC,
enforceable against PCC in accordance with its terms, except as may be limited
by bankruptcy,
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insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally and subject to the availability of equitable
remedies.
3.3 Financial Condition. The Borrower has heretofore delivered to the
Lenders, at the Lenders' request, the Financial Statements. All such statements
were prepared in conformity with GAAP and, together with the accompanying notes
thereto, if any, fairly present the financial position (where applicable on a
consolidated basis) of the entities described in such financial statements as at
the respective dates thereof and the results of operations and changes in
financial position (where applicable on a consolidated basis) of the entities
described therein for each of the periods then ended (subject to, in the case of
unaudited financial statements, normal year-end adjustments). The Borrower has
no (and will not following the funding of the Loans have) material Contingent
Obligation, contingent liability or liability for taxes, long-term lease or
unusual forward or long-term commitment that is not (or will not be, upon the
delivery thereof) reflected in the foregoing financial statements or the notes
thereto or in the annual financial statements required to be delivered pursuant
to subsection 5.1(b)(iii).
3.4 No Material Adverse Change; No Restricted Payments. Since December
31, 1996, no event or change has occurred that has caused or evidences, either
individually or in the aggregate, a Material Adverse Effect. Since December 31,
1996, the Borrower has not directly or indirectly declared, ordered, paid or
made or set apart any sum or property for any Restricted Payment or agreed so to
do, except as permitted by subsection 6.5.
3.5 Title To Properties; Liens. Each Loan Party holds (i) good,
marketable and insurable fee simple title, subject to Liens permitted by
subsection 6.2, to all its owned real property, (ii) good, sufficient, insurable
and valid leasehold title, subject to Liens permitted by subsection 6.2, to its
respective leased real property and (iii) good, sufficient and legal title,
subject to Liens permitted by subsection 6.2, to all of its material properties
and assets (other than as described in clauses (i) and (ii) of this sentence)
reflected in the balance sheet included with the Financial Statements or in the
most recent financial statements delivered pursuant to subsection 5.1(b) of this
Agreement, except for assets acquired or disposed of since the date of such
financial statements. Except as permitted by subsection 6.2, all such properties
and assets are free and clear of Liens.
3.6 Litigation; Adverse Facts. There is no action, suit, proceeding,
governmental arbitration or governmental investigation (whether or not
purportedly on behalf of any Loan Party) at law or in equity or before or by any
federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, pending or, to the
knowledge of the Borrower, threatened against or affecting any Loan Party or any
property of any Loan Party that has had, or could reasonably be expected to
result in any Material Adverse Effect. Neither the Borrower nor any of its
Subsidiaries has received any notice of termination of any material contract,
lease or other agreement, or suffered any material damage, destruction or loss,
(whether or not covered by insurance) or had any employee strike, work-stoppage,
slow-down or lock-out or any substantial threat directed to it of any imminent
strike, work-stoppage, slow-down or lock-out, any of which
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remain pending and are material to the conduct of the Borrower or its
Subsidiaries' business as presently conducted that could reasonably be expected
to result in a Material Adverse Effect.
3.7 Payment of Taxes. Except to the extent permitted by subsection 5.3,
all tax returns and reports of the Borrower and its Subsidiaries required to be
filed by it or on its behalf have been timely filed, and all taxes, assessments,
fees and other governmental charges upon such Persons and upon their respective
properties, assets, income and franchises which are due and payable have been
paid when due and payable. The Borrower does not know of any proposed tax
assessment against any such Person which is not being actively contested by such
Person, in good faith and by appropriate proceedings; provided that such
reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP shall have been made or provided therefor.
3.8 Performance of Agreements. (a) No Loan Party is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the giving of notice or the lapse of time or both, would
constitute such a default, except, in each case, where the consequences, direct
or indirect, of such default or defaults, if any, could not have a Material
Adverse Effect.
(b) No Loan Party is a party or subject to any agreement or instrument
which has or could reasonably be expected to have, individually or the
aggregate, a Material Adverse Effect.
3.9 Governmental Regulation. No Loan Party is subject to regulation
under the Public Utility Company Act of 1935, the Federal Power Act or the
Investment Company Act of 1940 or to any federal or state statute or regulation
limiting its ability to incur Indebtedness.
3.10 Securities Activities. Neither any Loan Party nor any of their
respective Subsidiaries is 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.
3.11 Employee Benefit Plans. (a) The Borrower and each ERISA Affiliate
is in substantial compliance with all provisions and requirements of ERISA with
respect to each Employee Benefit Plan, and have substantially performed all
their obligations under each Employee Benefit Plan. There are no actions, suits
or claims (other than routine claims for benefits) pending or threatened against
any Employee Benefit Plan or its assets, and, to the best knowledge of the
Borrower, no facts exist which could give rise to any such actions, suits or
claims.
(b) Within the period of five years ending on the Closing Date, no
ERISA Event has occurred, and there is no unpaid liability of the Borrower or
any ERISA Affiliate that arose in connection with any ERISA Event that occurred
prior to that five-year period.
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As of the Closing Date, no ERISA Event is reasonably expected to occur with
respect to any Employee Benefit Plan.
(c) Except to the extent required under Section 4980B of the Code, no
Employee Benefit Plan provides health or welfare benefits (through the purchase
of insurance or otherwise) for any retired or former employees of the Borrower
or any ERISA Affiliate.
(d) As of the most recent valuation date for any Pension Plan, the
excess of the actuarial present value (determined on the basis of reasonable
assumptions employed by the independent actuary for such Pension Plan) of the
benefit liabilities (as defined in Section 4001(a)(16) of ERISA), whether or not
vested, over the fair market value of the assets of such Pension Plan,
individually or in the aggregate for all Pension Plans (excluding for purposes
of such computation any Pension Plans with respect to which there is no such
excess), does not exceed $500,000.
3.12 Certain Fees. No broker's or finder's fee or commission will be
payable by the Borrower or any of its Subsidiaries (or to the best knowledge of
the Borrower, by any other Person), with respect to the making of the Loans, or
any of the other transactions contemplated hereby, and the Borrower hereby
indemnifies the Lenders against and agree that they will hold the Lenders
harmless from any claim, demand or liability for broker's or finder's fees
(other than any broker's or finder's fee of any broker or finder retained by the
Agent or the Lenders) alleged to have been incurred in connection with any such
offer, issuance and sale, or any of the other transactions contemplated hereby
and any expenses, including legal fees, arising in connection with any such
claim, demand or liability.
3.13 Environmental.
(i) The operations of the Borrower and its Subsidiaries
(including, without limitation, all operations and conditions at or in
the Facilities) comply, and for the period within any applicable
statute of limitations have complied, in all material respects with all
Environmental Laws;
(ii) The Borrower and each of its Subsidiaries has obtained
all permits under Environmental Laws necessary to their respective
operations, and all such permits are in good standing, and the Borrower
and each of its Subsidiaries is in compliance with all material terms
and conditions of such permits;
(iii) Neither the Borrower nor any of its Subsidiaries has
received (a) any notice or claim to the effect that it is or may be
liable to any Person as a result of the Release or threatened Release
of any Hazardous Materials or (b) any letter or request for information
under Section 104 of the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. ss. 9604) or comparable
state laws, and to the best of the Borrower's knowledge, none of the
operations of the Borrower or any of its Subsidiaries is the subject of
any federal or state investigation evaluating whether any further
investigation or remedial action is needed to respond to a Release
39
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or threatened Release of any Hazardous Material at any Facility or at
any other location;
(iv) None of the operations of the Borrower or any of its
Subsidiaries is subject to any judicial, administrative, or arbitral
proceeding alleging the violation of or liability under any
Environmental Laws which if adversely determined could reasonably be
expected to have a Material Adverse Effect;
(v) The Borrower and each of its Subsidiaries and all of
their Facilities or operations are not subject to any outstanding
written order or agreement with any governmental authority or private
party relating to (a) any Environmental Laws or (b) any Environmental
Claims that in each case could reasonably be expected to have a
Material Adverse Effect;
(vi) To the best knowledge of each Loan Party, neither the
Borrower nor any of its Subsidiaries has any contingent liability in
connection with any Release of any Hazardous Materials by the Borrower
or any Subsidiaries of the Borrower that could reasonably be expected
to have a Material Adverse Effect;
(vii) Neither the Borrower nor any of its Subsidiaries or, to
the best of the Borrower's knowledge, any predecessor of the Borrower
or any Subsidiaries of the Borrower has filed any notice under any
Environmental Law indicating past or present treatment or disposal of
Hazardous Materials at any Facility, and none of the Borrower's or any
of its Subsidiary's operations involves the generation, transportation,
treatment, storage or disposal of hazardous waste, as defined under 40
C.F.R. Parts 260-270 or any state equivalent in material violation of
any such law;
(viii) To the best knowledge of each Loan Party, no Hazardous
Material exists on, under or about any Facility in a manner that could
give rise to an Environmental Claim having a Material Adverse Effect,
and neither the Borrower nor any Subsidiary of the Borrower has filed
any notice or report of a Release of any Hazardous Materials that could
reasonably be expected to give rise to an Environmental Claim having a
Material Adverse Effect;
(ix) To the best knowledge of each Loan Party, neither the
Borrower nor any Subsidiary of the Borrower (or any of their
predecessors) has disposed of any Hazardous Materials in a manner that
could reasonably be expected to give rise to an Environmental Claim
having a Material Adverse Effect;
(x) No underground storage tanks or surface impoundments
are on or at the Facilities, other than those that could not reasonably
be expected to give rise to an Environmental Claim having a Material
Adverse Effect;
(xi) No Lien in favor of any Person for (a) any liability
under Environmental Laws, or (b) damages arising from or costs incurred
by such Person in response to a Release has been filed or has been
attached to the Facilities; and
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(xii) There is no radio frequency radiation, electromagnetic
field or similar condition of or about any property owned, operated, or
otherwise used by any Loan Party that could reasonably be expected to
give rise to a Material Adverse Effect.
3.14 Solvency. Each Loan Party is, and on and after the consummation of
the transactions contemplated hereby will be, Solvent.
3.15 Insurance. The Borrower and its Subsidiaries maintain, with
financially sound and reputable insurers, insurance with respect to its
properties and business and the properties and business of its Subsidiaries,
against loss or damage of the kinds customarily insured against by entities of
established reputation engaged in the same or similar business of such types and
in such amounts as are customarily carried under similar circumstances by such
other entities, including business interruption insurance in an amount
reasonably satisfactory to the Agent. Schedule 3.15 is a complete and accurate
description of all policies of insurance that will be in effect as of the
Closing Date for the Borrower and its Subsidiaries.
3.16 Intellectual Property. (a) The Borrower and its Subsidiaries own,
or are licensed to use, the Intellectual Property and all such Intellectual
Property is, in all material respects, fully protected and duly and properly
registered, filed or issued in the appropriate office and jurisdictions for such
registrations, filing or issuances.
(b) Except as disclosed on Schedule 3.16(b), (i) no material claim has
been asserted by any Person with respect to the use of any such Intellectual
Property, or challenging or questioning the validity or effectiveness of any
such Intellectual Property; (ii) to the best of the Borrower's knowledge, the
use of such Intellectual Property by the Borrower or any of its Subsidiaries
does not infringe on the rights of any Person, subject to such claims and
infringements as do not, in the aggregate, give rise to any liabilities on the
part of the Borrower or any of its Subsidiaries that are material to the
Borrower or any of its Subsidiaries; and (iii) the consummation of the
transactions contemplated by this Agreement will not in any material manner or
to any material extent impair the ownership of (or the license to use, as the
case may be) any of such Intellectual Property by the Borrower or any of its
Subsidiaries.
3.17 Disclosure. No representation or warranty of any Loan Party
contained in any Loan Document or any other document, certificate or written
statement furnished to the Lenders by or on behalf of any Loan Party for use in
connection with the transactions contemplated by this Agreement contains any
untrue statement of a material fact or omits to state a material fact (known to
the Borrower in the case of any document not furnished by it) necessary in order
to make the statements contained herein or therein not misleading in light of
the circumstances in which the same were made. The projections and pro forma
financial information contained in such materials are based upon good faith
estimates and assumptions believed by the Borrower to be reasonable at the time
made, it being recognized by the Lenders that such projections as to future
events are not to be viewed as facts and that actual results during the period
or periods covered by any such projections may differ from the projected
results. There is no fact known (or which should upon the reasonable exercise of
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diligence be known) to the Borrower (other than matters of a general economic
nature) that has had or could reasonably be expected to have a Material Adverse
Effect and that has not been disclosed herein or in such other documents,
certificates and statements furnished to the Lenders for use in connection with
the transactions contemplated hereby.
3.18 Security Documents. (a) Each of the Pledge Agreements is effective
to create in favor of the Agent, for the benefit of the Lenders, a legal, valid
and enforceable security interest in the Pledged Securities described therein
and proceeds thereof and, when the Pledged Notes described therein and stock
certificates representing the Pledged Stock described therein are delivered to
the Agent, each such Pledge Agreement shall constitute a fully perfected first
priority Lien on, and security interest in, all right, title and interest of the
relevant Loan Party in such Pledged Securities and the proceeds thereof, as
security for the Obligations (as defined in the relevant Pledge Agreement), in
each case prior and superior in right to any other Person.
(b) Each of the Security Agreements is effective to create in favor of
the Agent, for the benefit of the Lenders, a legal, valid and enforceable
security interest in the Collateral described therein and proceeds thereof, and
when financing statements in appropriate form are filed in the offices specified
on Schedule 3.18(b), each such Security Agreement shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the Loan Parties in such Collateral and the proceeds thereof, as security for
the Obligations (as defined in the relevant Security Agreement), in each case
prior and superior in right to any other Person, other than with respect to
Liens expressly permitted by subsection 6.2.
3.19 Purposes of Loans. The proceeds of the Term Loans shall be used by
the Borrower to finance, in part, the acquisition of substantially all of the
assets of The Travel Channel (and $2,000,000 of such Loans shall be used by the
Borrower to pay interest due on the Loans pursuant to the terms hereof) and the
proceeds of the Revolving Credit Loans shall be used by the Borrower for working
capital purposes.
SECTION 4. CONDITIONS PRECEDENT
4.1 Conditions to Initial Loans. The agreement of each Lender to make
the initial Loan requested to be made by it is subject to the satisfaction on or
prior to July 14, 1997 of the following conditions precedent:
(a) Loan Documents. The Agent shall have received (i) this
Agreement, executed and delivered by a duly authorized officer of the
Borrower, with a counterpart for each Lender, (ii) the ▇▇▇▇▇▇ Pledge
Agreement, executed and delivered by ▇▇▇▇▇▇ and Second Crystal, with a
counterpart or a conformed copy for each Lender, (iii) the PCUH Pledge
Agreement, executed and delivered by a duly authorized officer of the
parties thereto, with a counterpart or a conformed copy for each
Lender, (iv) the Borrower Security Agreement, executed and delivered by
a duly authorized officer of the parties thereto, with a counterpart or
a conformed copy for
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each Lender and (v) for the account of each relevant Lender, Notes
conforming to the requirements hereof and executed and delivered by a
duly authorized officer of the Borrower.
(b) Related Agreements. The Agent shall have received, with a
copy for each Lender, true and correct copies, certified as to
authenticity by the Borrower, of the Purchase Documentation and such
documents or instruments as may be reasonably requested by the Agent,
including, without limitation, a copy of any debt instrument, security
agreement or other material contract to which the Borrower or any of
its Subsidiaries may be a party.
(c) Borrowing Certificate. The Agent shall have received, with
a counterpart for each Lender, a certificate of each Loan Party, dated
the Closing Date, substantially in the form of Exhibit G, with
appropriate insertions and attachments, satisfactory in form and
substance to the Agent, executed by the President or any Vice President
and the Secretary or any Assistant Secretary of the Borrower.
(d) Corporate Proceedings of the Borrower. The Agent shall
have received, with a counterpart for each Lender, a copy of the
resolutions, in form and substance satisfactory to the Agent, of the
Board of Directors of the Borrower authorizing (i) the execution,
delivery and performance of this Agreement and the other Loan Documents
to which it is a party, (ii) the borrowings contemplated hereunder and
(iii) the granting by it of the Liens created pursuant to the Borrower
Security Documents, certified by the Secretary or an Assistant
Secretary of the Borrower as of the Closing Date, which certificate
shall be in form and substance satisfactory to the Agent and its
counsel and shall state that the resolutions thereby certified have not
been amended, modified, revoked or rescinded.
(e) Borrower Incumbency Certificate. The Agent shall have
received, with a counterpart for each Lender, a Certificate of the
Borrower, dated the Closing Date, as to the incumbency and signature of
the officers of the Borrower executing any Loan Document satisfactory
in form and substance to the Agent, executed by the President or any
Vice President and the Secretary or any Assistant Secretary of the
Borrower.
(f) Due Diligence. The Agent shall be satisfied with the
corporate and capital structures of each Loan Party, including any
ownership or management agreements. The Agent shall have received, and
shall be satisfied with the form and substance of, such additional
financial, legal and operating information of the Loan Parties as it
shall request, including but not limited to operating projections, film
payment obligation information and a pro forma balance sheet dated as
of the Closing Date giving effect to the transactions contemplated
hereby.
(g) Consummation of the Acquisition. On or prior to the
Closing Date, (i) the Borrower shall have acquired substantially all of
the assets of The Travel Channel in accordance with the Purchase
Documentation and (ii) the aggregate amount of fees and expenses paid
in connection therewith and the other transactions contemplated
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37
thereby and by the Loan Documents shall not have been more than
$2,000,000; provided that the Lenders shall be reasonably satisfied (i)
with the terms and conditions of the Purchase Documentation including,
without limitation, any amendment or modification thereto and (ii) that
such terms and conditions shall have been complied with and satisfied
in all material respects and that such acquisition shall have been
consummated in accordance with such terms and conditions in all
material respects.
(h) Organizational Documents. The Agent shall have received,
with a counterpart for each Lender, true and complete copies of the
certificate of incorporation and by-laws or other organizational
documents of each Loan Party, certified as of the Closing Date as
complete and correct copies thereof by the Secretary or an Assistant
Secretary of the such Loan Party.
(i) Fees. All fees and expenses which the Borrower has agreed
to pay in connection with the execution and delivery of this Agreement
shall have been paid in full to the Agent and Lenders on the date on
which this Agreement shall become effective in accordance with
subsection 9.8, including but not limited to fees due under the fee
letter dated as of July 7, 1997 between the Borrower and the Agent.
(j) Legal Opinions. The Agent shall have received, with a
counterpart for each Lender, the following executed legal opinions:
(i) the executed legal opinion of Dow, ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇, counsel to the Borrower and the other Loan Parties,
in form and substance satisfactory to the Agent and the
Lenders; and
(ii) the executed legal opinion of ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, General Counsel to the Borrower, in form and
substance satisfactory to the Agent and the Lenders.
Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Agent may reasonably
require.
(k) Pledged Stock; Stock Powers; Pledged Notes. The Agent
shall have received the certificates representing the shares pledged
pursuant to each of the ▇▇▇▇▇▇ Pledge Agreement and the PCUH Pledge
Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the
pledgor thereof, and an executed Federal Reserve Form U-1 in connection
with the ▇▇▇▇▇▇ Pledge Agreement.
(l) Actions to Perfect Liens. The Agent shall have received
evidence in form and substance satisfactory to it that all filings,
recordings, registrations and other actions, including, without
limitation, the filing of duly executed financing statements on form
UCC-1, necessary or, in the opinion of the Agent, desirable to perfect
the Liens created by the Security Documents shall have been completed.
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(m) Lien Searches. The Agent shall have received the results
of a recent search by a Person satisfactory to the Agent, of the
Uniform Commercial Code, judgement and tax lien filings which may have
been filed with respect to personal property of the Borrower, and the
results of such search shall be satisfactory to the Agent.
(n) Insurance. The Agent shall have received evidence in form
and substance satisfactory to it that all of the requirements of
subsection 5.4 shall have been satisfied.
4.2 Conditions to Each Loan. The agreement of each Lender to make any
Loan requested to be made by it on any date (including, without limitation, its
initial Loan) is subject to the satisfaction of the following conditions
precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by the Borrower and its
Subsidiaries in or pursuant to the Loan Documents shall be true and
correct in all material respects on and as of such date as if made on
and as of such date except for any representation and warranty which is
expressly made as of an earlier date, which representation and warranty
shall have been true and correct in all material respects as of such
earlier date.
(b) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the
Loans requested to be made on such date.
(c) Additional Matters. All corporate and other proceedings,
and all documents, instruments and other legal matters in connection
with the transactions contemplated by this Agreement, the other Loan
Documents shall be reasonably satisfactory in form and substance to the
Agent, and the Agent shall have received such other documents and legal
opinions in respect of any aspect or consequence of the transactions
contemplated hereby or thereby as it shall reasonably request.
(d) ▇▇▇▇▇▇ Pledge. In the case of the initial Term Loan in an
aggregate principal amount of $20,000,000, ▇▇▇▇▇▇ and Second Crystal
shall have pledged at least 3,200,000 shares of common stock of PCC
pursuant to the ▇▇▇▇▇▇ Pledge Agreement, and in the case of any
subsequent Loans, ▇▇▇▇▇▇ and Second Crystal shall have pledged at least
3,680,000 shares of common stock of PCC pursuant to the ▇▇▇▇▇▇ Pledge
Agreement.
Each borrowing by the Borrower hereunder shall constitute a representation and
warranty by the Borrower as of the date thereof that the conditions contained in
this subsection have been satisfied.
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SECTION 5. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain in
effect or any amount is owing to any Lender or the Agent hereunder or under any
other Loan Document, the Borrower shall and (except in the case of delivery of
financial information, reports and notices) shall cause each of its Subsidiaries
to:
5.1 Financial Statements and Systems.
(a) Accounting System: Maintain a system of accounting established and
administered in accordance with sound business practices to permit preparation
of financial statements in conformity with GAAP.
(b) Financial Statements and Other Reports: Deliver to the Lenders:
(i) Monthly Financials: as soon as practicable and in any
event within 30 days after the end of each fiscal month of the
Borrower, copies of the consolidated income statement, operating cash
flow statement and performance to budget analysis for the Borrower and
its Subsidiaries for and as of the end of such fiscal month and
comparative figures for such fiscal month in the prior fiscal year;
(ii) Quarterly Financials: as soon as practicable and in any
event within 45 days after the end of each fiscal quarter of the
Borrower ending after the Closing Date, a consolidated balance sheet of
the Borrower and its consolidated Subsidiaries as at the end of such
period, and the related unaudited consolidated statements of income and
of cash flows, certified by the chief financial officer of the Borrower
that they fairly present the financial condition and results of
operations of the Borrower and its Subsidiaries, as appropriate, as at
the end of such periods and for such periods, subject to changes
resulting from audit and normal year-end adjustments;
(iii) Year-End Financials: as soon as practicable and in any
event within 90 days after the end of each fiscal year of the Borrower,
the audited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries, as at the end of such year, and the related
consolidated statements of income, shareholders' equity and cash flows
of the Borrower and its Subsidiaries for such fiscal year, (a)
accompanied by a report thereon of independent certified public
accountants of recognized national standing selected by the Borrower
and reasonably satisfactory to Agent and the Required Lenders, which
report shall contain no qualifications with respect to the continuance
of the Borrower and its consolidated Subsidiaries as going concerns and
shall state that such financial statements present fairly the financial
position of the Borrower and its consolidated Subsidiaries as at the
dates indicated and the statements of income and cash flows for the
periods indicated in conformity with GAAP applied on a basis consistent
with prior years (except as otherwise stated therein) and that the
examination by such accountants in connection with such financial
statements has been made in accordance with generally accepted auditing
standards without any limitations being imposed on the scope of such
examination and (b) certified by the chief
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financial officer of the Borrower that they fairly present the
financial condition and results of operations of the Borrower and its
Subsidiaries, as at the dates and for the periods indicated, as
appropriate;
(iv) Officers' and Compliance Certificates: together with each
delivery of financial statements of the Borrower and its Subsidiaries
pursuant to subdivisions (ii) and (iii) above, (a) an Officer's
Certificate of the Borrower stating that the signers have reviewed the
terms of this Agreement and the Notes and have made, or caused to be
made under their supervision, a review in reasonable detail of the
transactions and condition of the Borrower and its Subsidiaries during
the accounting period covered by such financial statements and that
such review has not disclosed the existence during or at the end of
such accounting period, and that the signers do not have knowledge of
the existence as at the date of such Officers' Certificate, of any
condition or event which constitutes an Event of Default or Default,
or, if any such condition or event existed or exists, specifying the
nature and period of existence thereof and what action the Borrower has
taken, is taking and proposes to take with respect thereto; (b) a
certificate (a "Compliance Certificate") in a form satisfactory to the
Agent demonstrating in reasonable detail compliance during and at the
end of the applicable accounting periods with the provisions of Section
6 and (c) a performance to budget analysis for the Borrower and its
Subsidiaries for and as of the end of such fiscal period and
comparative figures for such fiscal period in the prior fiscal year;
(v) Reconciliation Statement: if, as a result of any change
in accounting principles and policies from those used in the
preparation of the Financial Statements, the financial statements of
the Borrower and its consolidated Subsidiaries delivered pursuant to
subsections (ii), (iii) or (xii) of this subsection 5.1(b) will differ
in any material respect from the financial statements that would have
been delivered pursuant to such subsections had no such change in
accounting principles and policies been made, then, together with the
first delivery of financial statements pursuant to subsection (ii),
(iii) or (xii) following such change, financial statements of the
Borrower and its consolidated Subsidiaries prepared on a pro forma
basis, for (y) the current year to the effective date of such change
and (z) the one full fiscal year immediately preceding the fiscal year
in which such change is made, as if such change had been in effect
during such period;
(vi) Accountants' Certification: together with each delivery
of consolidated financial statements of the Borrower and its
Subsidiaries pursuant to subdivision (iii) above, to the extent
available, a written statement by the independent public accountants
giving the report thereon (a) stating that their audit examination has
included a review of the terms of this Agreement and the Notes as they
relate to accounting matters, (b) stating whether, in connection with
their audit examination, any condition or event that constitutes an
Event of Default or Default has come to their attention and, if such a
condition or event has come to their attention, specifying the nature
and period of existence thereof; provided that such accountants shall
not be liable by reason of any failure to obtain knowledge of any such
Event of Default or Default with respect to accounting matters that
would not be disclosed in the course of
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their audit examination and (c) stating that, based on their audit
examinations nothing has come to their attention that causes them to
believe that the information contained in the Compliance Certificate
delivered therewith pursuant to clause (b) of subdivision (iv) above
for the applicable fiscal year are not stated in accordance with the
terms of this Agreement;
(vii) Accountants' Reports: promptly upon receipt thereof
(unless restricted by applicable professional standards), copies of all
significant reports submitted to the Borrower by independent public
accountants in connection with each annual, interim or special audit of
the financial statements of the Borrower made by such accountants,
including, without limitation, the comment letter submitted by such
accountants to management in connection with their annual audit;
(viii) Reports and Filings: within five days after the same
are sent, copies of all financial statements and reports which the
Borrower sends to its stockholders, and within five days after the same
are filed, copies of all financial statements and reports which the
Borrower may make to, or file with, the Securities and Exchange
Commission or any successor or analogous Governmental Authority;
(ix) Events of Default etc.: promptly upon, but in any event
no later than two Business Days after, any officer of the Borrower
obtaining knowledge (a) of any condition or event that constitutes an
Event of Default or Default, or becoming aware that any Lender or the
Agent has given any notice or taken any other action with respect to a
claimed Event of Default or Default under this Agreement, (b) that any
Person has given any notice to the Borrower or any of its Subsidiaries
or taken any other action with respect to a claimed default or event or
condition of the type referred to in Section 7(b) and (e), (c) of any
condition or event that would be required to be disclosed in a current
report filed by the Borrower with the Securities and Exchange
Commission on Form 8-K (Items 1, 2, 4 and 5 of such Form as in effect
on the date hereof) if the Borrower were a filing Person under the
rules thereof or (d) of any condition or event which has had or could
reasonably be expected to have a Material Adverse Effect (which, for
such purposes, shall be determined with respect to the Borrower
individually), an Officer's Certificate specifying the nature and
period of existence of such condition or event, or specifying the
notice given or action taken by such holder or Person and the nature of
such claimed default, Event of Default, Default, event or condition,
and what action the Borrower has taken, is taking and proposes to take
with respect thereto;
(x) Litigation: promptly upon any officer of the Borrower
obtaining knowledge of (a) the institution of any action, suit,
proceeding, governmental investigation or arbitration against or
affecting any Loan Party or any property of any Loan Party not
previously disclosed by the Borrower or the other Loan Parties to the
Lenders or (b) any material adverse development in any such action,
suit, proceeding, governmental investigation or arbitration that, in
any case:
(y) involves claims in excess of $100,000 in the aggregate;
or
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(z) would reasonably be expected to cause a Material Adverse
Effect;
the Borrower shall promptly give notice thereof to the Lenders and
provide such other information as may be reasonably available to them
to enable the Lenders and their counsel to evaluate such matters;
(xi) ERISA Events: promptly upon becoming aware of the
occurrence of or forthcoming occurrence of any ERISA Event in
connection with any Employee Benefit Plan or any trust created
thereunder, with a written notice specifying the nature thereof, what
action the Borrower or ERISA Affiliate has taken, is taking or proposes
to take with respect thereto and, when known, any action taken or
threatened by the Internal Revenue Service, the Department of Labor or
the PBGC with respect thereto;
(xii) ERISA Notices: with reasonable promptness, copies of
(a) all notices received by the Borrower or any of its ERISA Affiliates
from the PBGC relating to an ERISA Event, (b) each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) filed
by the Borrower or any of its ERISA Affiliates with the Internal
Revenue Service with respect to each Pension Plan, if any, and (c) all
notices received by the Borrower or any of its ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event;
(xiii) Financial Plans: as soon as practicable and in any
event no later than the 30 days after the end of any fiscal year of the
Borrower, a budget and financial forecast for the Borrower and its
Subsidiaries including, (a) a forecasted operating cash flows statement
of the Borrower and its Subsidiaries for the next succeeding fiscal
year, (b) forecasted operating cash flows statement of the Borrower and
its Subsidiaries for each fiscal quarter of the next succeeding fiscal
year and (c) such other information and projections as any Lender may
reasonably request, in each case, in a format satisfactory to the
Agent; and
(xiv) Other Information: with reasonable promptness, such
other information and data with respect to the Borrower or any of its
Subsidiaries or Affiliates as from time to time may be reasonably
requested by any Lender.
5.2 Maintenance of Existence, etc.. Except as permitted by subsection
6.6, preserve and keep in full force and effect its corporate or partnership
existence, as the case may be, and rights and franchises material to its
business.
5.3 Payment of Taxes and Claims; Tax Consolidation. Pay all taxes,
assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its franchises, business, income or
property, non-payment of which would cause a Material Adverse Effect, before any
penalty accrues thereon, and all claims (including, without limitation, claims
for labor, services, materials and supplies) for sums that have become due and
payable and that by law have or may become a material Lien upon any of its
properties or assets, prior to the time when any penalty or fine shall be
incurred with
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respect thereto; provided that no such tax, assessment, charge or claim need be
paid if being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted and if such reserve or other appropriate
provision, if any, as shall be required in conformity with GAAP shall have been
made therefor. Neither the Borrower nor any of its Subsidiaries will file or
consent to the filing of any consolidated income tax return with any Person
(other than the Borrower or its Subsidiaries).
5.4 Maintenance of Properties; Insurance. Maintain in good repair,
working order and condition all material properties used or useful in the
business of the Borrower and its Subsidiaries (including, without limitation,
Intellectual Property) and from time to time will make or cause to be made all
appropriate (as reasonably determined by the Borrower) repairs, renewals and
replacements thereof. The Borrower will maintain or cause to be maintained, with
financially sound and reputable insurers, insurance with respect to its
properties and business and the properties and business of its Subsidiaries
(including without limitation, business interruption insurance and insurance on
plant, property and equipment) against loss or damage of the kinds customarily
carried or maintained under similar circumstances by entities of established
reputation engaged in similar businesses. On or before the end of each fiscal
year, the Borrower shall submit to the Agent an Officers' Certificate updating
the information contained in Schedule 3.15 as of such date. Each such policy of
insurance (other than business interruption insurance) shall name the Agent as
the loss payee or as additional insured, as the Agent may require, for the
benefit of the Lenders thereunder and provide for at least thirty (30) days
prior written notice (or such other period as is customary in the industry) to
the Agent of any material modification or any cancellation of such policies.
5.5 Inspection; Lender Meeting. Subject to subsection 9.15, permit any
authorized representatives designated by the Agent to visit and inspect any of
the properties of the Borrower, any of its Subsidiaries, including its and their
financial and accounting records, and to make copies and take extracts
therefrom, and to discuss its and their affairs, finances and accounts with its
and their officers and independent public accountants, all upon reasonable
notice and at such reasonable times during normal business hours and as often as
may be reasonably requested. Without in any way limiting the foregoing, the
Borrower will, upon the request of the Required Lenders, participate in a
meeting with the Agent and the Lenders once during each fiscal year to be held
at the Borrower's corporate offices at such time as may be agreed to by the
Borrower and the Required Lenders.
5.6 Compliance with Laws, etc. (a)(i) Comply with the requirements of
all applicable laws, rules, regulations and orders of any Governmental Authority
noncompliance with which could reasonably be expected to cause a Material
Adverse Effect and (ii) comply in all material respects at all times with all
provisions of all material agreements, licenses and leases to which it is a
party or of which it is a beneficiary and suffer no loss or forfeiture thereof
or thereunder except for any non-compliance or a loss or forfeiture which does
not have and could not reasonably be expected to have a Material Adverse Effect;
and
(b) Not engage in any transaction or permit the occurrence of any act
or omission, and shall cause each ERISA Affiliate not to engage in any
transaction or to permit
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the occurrence of any act or omission, which would constitute, or would give
rise to, an ERISA Event which would cause a Material Adverse Effect.
5.7 Environmental Disclosure and Inspection. (a) Comply, and undertake
all reasonable efforts to ensure that all tenants under any lease or occupancy
agreement affecting any portion of the Facilities and all other Persons on or
occupying such property comply, in all materials respects with all Environmental
Laws, provided that upon learning of any noncompliance with Environmental Laws
by the Borrower or any of its Subsidiaries, shall promptly undertake all
reasonable efforts to remedy such non-compliance.
(b) Agree that the Agent is entitled (but has no obligation), from time
to time (upon the Agent's determination in its reasonable discretion that any of
the following is advisable), upon notice to the Borrower and as often as may
reasonably be requested, retain, at the Borrower's expense, an independent
professional consultant to review any report relating to Hazardous Materials
prepared by or for the Borrower and to conduct its own investigation of any
Facility. The Borrower hereby grants to the Agent, its agents, employees,
consultants and contractors the right to enter into or on to the Facilities upon
reasonable notice and at such times during normal business hours and as often as
may reasonably be requested to perform such tests on such property as are
reasonably necessary to conduct such a review and/or investigation. The Borrower
may receive copies of any reports prepared by independent experts, but the
Lenders shall have no duty to disclose or discuss any information produced by
such reviews or investigations with the Borrower or any of its Subsidiaries.
(c) Promptly advise the Lenders in writing and in reasonable detail of
(i) any Release of any Hazardous Material (of which the Borrower is aware)
required to be reported to any federal, state or local governmental or
regulatory agency under any applicable Environmental Laws, (ii) any and all
written communications with respect to Environmental Claims or any Release of
Hazardous Material required to be reported to any federal, state or local
governmental or regulatory agency, (iii) any remedial action taken by the
Borrower or any other Person in response to (a) any Hazardous Material on, under
or about any Facility, the existence of which could reasonably be expected to
result in an Environmental Claim having a Material Adverse Effect or (b) any
Environmental Claim that could reasonably be expected to have a Material Adverse
Effect, (iv) the Borrower's discovery of any occurrence or condition on any real
property adjoining or in the vicinity of any Facility that could cause such
Facility or any part thereof to be classified as a "border-zone property" or to
be otherwise subject to any restrictions on the ownership, occupancy,
transferability or use thereof under any Environmental Laws that could
reasonably be expected to have a Material Adverse Effect, and (v) any request
for information from any governmental agency that indicates such agency is
investigating whether the Borrower or any of its Subsidiaries may be potentially
responsible for a Release of Hazardous Materials.
(d) Promptly notify the Lenders of any proposed acquisition or
disposition of stock, assets, or property by any Loan Party, that could
reasonably be expected to expose the Borrower or any of its Subsidiaries to, or
result in, Environmental Claims that could have a Material Adverse Effect and of
any proposed action to be taken by the Borrower or any of its
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Subsidiaries to commence or cease manufacturing, industrial or other operations
that could reasonably be expected to subject the Borrower or any of its
Subsidiaries to additional laws, rules or regulations, including, without
limitation, laws, rules and regulations requiring additional environmental
permits or licenses.
(e) At their own expense, provide copies of such documents or
information as the Agent may reasonably request in relation to any matters
disclosed pursuant to this subsection.
5.8 Hazardous Materials; the Borrower's Remedial Action. Take promptly
any and all necessary remedial action required by all applicable Environmental
Laws and perform such remedial action in compliance with all applicable
Environmental Laws and orders and directives of all federal, state and local
governmental authorities except when and only to the extent that the Borrower's
or such Subsidiary's liability for the presence, storage, use, disposal,
transportation or discharge of any Hazardous Material is being contested in good
faith by the Borrower or such Subsidiary by appropriate proceedings, and the
pendency of such proceedings is not reasonably likely to give rise to a Material
Adverse Effect.
5.9 Additional Loan Parties. In the event that (i) the Borrower
proposes for any other reason to add any Subsidiary or Affiliate thereof as a
Loan Party hereunder (each such Subsidiary or Affiliate in any case referred to
herein as an "Additional Loan Party" and collectively as the "Additional Loan
Parties"), then, on or before the consummation of any such transaction or
addition as a Loan Party hereunder, such Additional Loan Party shall deliver
appropriate counterparts and assumptions of each Loan Document to which it is to
be a party and all such documents, opinions of counsel, certificate and
instruments as such Additional Loan Party would have been required to deliver
pursuant to subsection 4.1 had such Additional Loan Party been a Loan Party
hereunder on the Closing Date and such other documents, certificates,
instruments and assurances as are consistent with the provisions of subsection
2.18 and Section 4 in relation to such Additional Loan Party's proposed status
hereunder and under the other Loan Documents (including, without limitation,
taking into consideration whether the obligations of such Additional Loan Party
are to be of a limited recourse nature or otherwise), all as shall be determined
at the time such Additional Loan Party is approved by the Agent. Upon
satisfaction of the foregoing conditions, such Additional Loan Party shall be a
Loan Party for all purposes hereunder and under the other Loan Documents.
5.10 Schedule Supplements. Each of the Schedules referred to in
subsection 3.1 shall be automatically amended from time to time upon written
notice by the Borrower to the Agent and the Lenders to reflect additional
information described in such notice under this Agreement including, without
limitation, the addition (or deletion) of any Subsidiaries or any other
transaction permitted hereunder. Without limiting the foregoing, on the request
of the Agent or any Lender (in the event that such information is not otherwise
delivered by the Borrower to the Agent or the Lenders pursuant to this
Agreement), the Borrower will supplement each Schedule hereto, or representation
herein or in any other Loan Document with respect to any matter hereafter
arising which, if existing or occurring at the date of this Agreement, would
have been required to be set forth or described in such
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Schedule or as an exception to such representation or which is necessary to
correct any information in such Schedule or representation which has been
rendered inaccurate thereby; provided that such supplement to such Schedule or
representation shall not be deemed an amendment thereof if such amendment would
require the consent of the Required Lenders under the terms of this Agreement,
unless expressly consented to in writing by the Required Lenders, and no such
amendments, except as the same may be consented to in a writing which expressly
includes a waiver, shall be or be deemed a waiver by the Lenders of any Event of
Default or Default disclosed therein.
5.11 Unrestricted Subsidiary. Each of the Borrower and PCUH shall
maintain its status as an "Unrestricted Subsidiary" (as defined in the PCC
Existing Credit Agreement) under the PCC Existing Credit Agreement.
SECTION 6. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain in
effect or any amount is owing to any Lender or the Agent hereunder or under any
other Loan Document, the Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly:
6.1 Limitation on Indebtedness. Create, incur, assume, guaranty, or
otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(a) Indebtedness under the Loan Documents;
(b) Contingent Obligations permitted by subsection 6.4 and,
upon any obligations actually arising pursuant thereto, the
Indebtedness corresponding to the Contingent Obligations so
extinguished;
(c) purchase money Indebtedness incurred in the ordinary
course of business not in excess of $100,000 in the aggregate
outstanding at any time; and
(d) Indebtedness of the Borrower or any Subsidiary to any
Subsidiary and of any Subsidiary to the Borrower or any Subsidiary.
6.2 Liens and Related Matters.
(a) Prohibitions on Liens. Create, incur, assume or permit to exist any
Lien on or with respect to any property or asset (including any document or
instrument in respect of goods or accounts receivable) of the Borrower or any of
its Subsidiaries, whether now owned or hereafter acquired, or any income or
profits therefrom, except:
(i) Permitted Encumbrances;
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(ii) Liens securing purchase money Indebtedness permitted
pursuant to subsection 6.1(c); provided that such Liens shall encumber
only the assets purchased with the proceeds of such Indebtedness; and
(iii) Liens granted pursuant to the Loan Documents.
(b) Equitable Lien in Favor of the Lenders. Create or assume any Lien
upon any of its property or assets, whether now owned or hereafter acquired,
other than Liens excepted by the provisions of this subsection, unless the
Borrower and its Subsidiaries make or cause to be made effective provision
whereby the Obligations will be secured by such Lien equally and ratably with
any and all other Indebtedness thereby secured as long as any such Indebtedness
shall be secured; provided that, notwithstanding the foregoing, this covenant
shall not be construed as a consent by the Required Lenders to any creation or
assumption of any such Lien not permitted by the provisions of this subsection.
(c) No Further Negative Pledges. Enter into any agreement prohibiting
(i) the creation or assumption of any Lien upon its properties or assets,
whether now owned or hereafter acquired or (ii) any incurrence of any Contingent
Obligations.
(d) No Restrictions on Subsidiary Distributions to the Borrower. Except
as provided herein, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any Subsidiary to (a) pay dividends or make any other distribution on any of
such Subsidiary's capital stock, partnership interests or other interests, as
the case may be, owned by the Borrower or any Subsidiary of the Borrower, (b)
subject to subordination provisions any payments in respect of any Indebtedness
owed to the Borrower or any Subsidiary of the Borrower, (c) make loans or
advances to the Borrower or any Subsidiary of the Borrower or (d) transfer any
of its property or assets to the Borrower or any Subsidiary of the Borrower.
6.3 Investments; Joint Ventures. Make or own any Investment, directly
or indirectly, in any Person including any Joint Venture, except:
(a) Investments in Cash and Cash Equivalents; and
(b) Investments by the Borrower in any Subsidiary Guarantor and
Investments by Subsidiaries in the Borrower and in any Subsidiary Guarantor.
6.4 Contingent Obligations. Create or become or be liable, directly or
indirectly, with respect to any Contingent Obligation except:
(a) Contingent Obligations incurred pursuant to the Loan Documents;
(b) Contingent Obligations resulting from the endorsement of
negotiable instruments for collection in the ordinary course of business; and
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(c) Contingent Obligations in respect of Indebtedness permitted
under subsection 6.1(c).
6.5 Restricted Payments. Declare, order, pay, make or set apart any
sum, directly or indirectly for any Restricted Payment except, so long as no
Event of Default or Default has occurred and is continuing or would result
therefrom, any Subsidiary may make Restricted Payments to the Borrower or any
Subsidiary Guarantor.
6.6 Restriction on Fundamental Changes; Asset Sales. Alter the
corporate, partnership, capital or legal structure of the Borrower or any of its
Subsidiaries or enter into any transaction of merger, or consolidate, or
liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease, sub-lease, transfer or otherwise dispose
of, in one transaction or a series of transactions, all or any part of its
business, property or assets (including, without limitation, any of the capital
stock or partnership interests held by such Person in any of its Subsidiaries),
whether now owned or hereafter acquired (other than in the ordinary course of
business), or acquire by purchase, lease or otherwise (in one transaction or a
series of related transactions) all or any part of the business, property or
fixed assets of, or stock or other evidence of beneficial ownership of, any
Person (other than purchases or other acquisitions of inventory, leases,
materials, property and equipment in the ordinary course of business) or agree
to do any of the foregoing at any future time, except:
(a) Investments permitted by subsection 6.3;
(b) the sale of programming or other inventory-like assets in the
ordinary course of business; and
(c) the sale of less than or equal to 50% of the voting and economic
equity interests in the Borrower to a cable network satisfactory to the Agent so
long as (i) the Agent is reasonably satisfied with the terms and conditions of
such sale (including the collateral for the Loans subsequent to such sale) and
(ii) no Default or Event of Default shall have occurred and be continuing.
6.7 Sales and Lease-Backs. Become or remain liable, directly or
indirectly, as lessee or as guarantor or other surety with respect to any lease,
whether an Operating Lease or a Capital Lease, of any property (whether real or
personal or mixed) whether now owned or hereafter acquired, (i) which the
Borrower or any of its Subsidiaries has sold or transferred or is to sell or
transfer to any other Person (other than the Borrower or any of its
Subsidiaries), or (ii) which the Borrower or any such Subsidiary of the Borrower
intends to use for substantially the same purpose as any other property which
has been or is to be sold or transferred by the Borrower or any such Subsidiary
of the Borrower to any Person (other than the Borrower or one of its
Subsidiaries) in connection with such lease.
6.8 Sale or Discount of Receivables. Sell, directly or indirectly, any
of their notes or accounts receivable other than in the ordinary course of
business.
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6.9 Transactions with Shareholders and Affiliates. Enter into or permit
to exist any transaction (including, without limitation, the purchase, sale,
lease or exchange of any property or the rendering of any service), directly or
indirectly, with any holder (other than any Subsidiary directly or indirectly
wholly owned by the Borrower) of 5% or more of any class of equity Securities or
other interests of the Borrower or any of its Subsidiaries or with any Affiliate
of the Borrower or of any such holder, as the case may be, on terms that are
less favorable to the Borrower or any Subsidiary, as the case may be, than those
that might be obtained at the time from Persons who are not such a holder or
Affiliate.
6.10 Disposal of Subsidiary Stock.
(i) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock, partnership
interests, or other equity securities of (or warrants, rights or
options to acquire shares or other equity securities of) any of its
Subsidiaries, except to qualify directors if required by applicable
law; or
(ii) permit any of its Subsidiaries directly or indirectly to
sell, assign, pledge or otherwise encumber or dispose of any shares of
capital stock, partnership interests, or other securities of (or
warrants, rights or options to acquire shares or other securities of)
any of its Subsidiaries, except to the Borrower, a Subsidiary of the
Borrower, or to qualify directors if required by applicable law.
6.11 Conduct of Business. Engage in any business other than those
businesses conducted on the Closing Date or directly related thereto.
6.12 Amendments or Waivers of Charter Documents; Limitation on Optional
Payments.
(a) Agree to any amendment to, or waive any of its rights under, its
articles of incorporation, by-laws, partnership agreement or other documents
relating to its capital stock or other equity interests of the Borrower or its
Subsidiaries (other than amendments or waivers which individually, or together
with all other amendments, waivers or changes made, would not be adverse to the
Borrower or any of its Subsidiaries or the Agent or any Lender) without, in each
case, obtaining the written consent of the Agent and the Required Lenders to
such amendment or waiver.
(b) Make any optional payment or prepayment on or redemption,
defeasance or purchase of any Indebtedness (excluding the Obligations) or amend,
modify or change, or consent or agree to any amendment, modification or change
to, any of the terms relating to any Indebtedness other than the Obligations
(other than any such amendment, modification or change (including, without
limitation, pursuant to a waiver) which would extend the maturity or reduce the
amount of any payment of principal thereof or which would reduce the rate or
extend the date for payment of interest thereon.
6.13 Fiscal Year. Change its fiscal year-end from December 31 without
the consent of the Required Lenders.
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SECTION 7. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) Failure of any Loan Party to pay any installment of
principal of any Loan when due in accordance with the terms thereof or
hereof; or any Loan Party shall fail to pay any interest on any Loan
when due or any other amount due pursuant to the Loan Documents within
two Business Days after the date due in accordance with the terms
thereof or hereof; or
(b) Failure of any Loan Party or any of their respective
Subsidiaries, to pay when due (x) any principal or interest on any
Indebtedness (other than Indebtedness referred to in paragraph (a) of
this Section and intercompany debt) in an individual principal amount
of $100,000 or more or items of Indebtedness with an aggregate
principal amount of $100,000 or more or (y) any Contingent Obligation
in an individual principal amount of $100,000 or more or Contingent
Obligations with an aggregate principal amount of $100,000 or more, in
each case beyond the end of any grace period provided therefor; or
(c) Breach or default of any Loan Party or any of their
respective Subsidiaries, with respect to any other material term of (i)
any evidence of any Indebtedness (other than intercompany debt) in an
individual principal amount of $100,000 or more or items of
Indebtedness (other than intercompany debt) with an aggregate principal
amount of $100,000 or more or any Contingent Obligation in an
individual principal amount of $100,000 or more or Contingent
Obligations with an aggregate principal amount of $100,000 or more or
(ii) any loan agreement, mortgage, indenture or other agreement
relating thereto, if the effect of such failure, default or breach is
to cause, or to permit the holder or holders of that Indebtedness or
Contingent Obligation (or a trustee on behalf of such holder or
holders) then to cause, that Indebtedness or Contingent Obligation to
become or be declared due prior to its stated maturity (or the stated
maturity of any underlying obligation, as the case may be); or
(d) Failure of the Borrower to perform or comply with any term
or condition contained in subsection 5.2 or Section 6; or
(e) Any representation, warranty, certification or other
statement made by any Loan Party in any Loan Document or in any
statement or certificate at any time given by any Loan Party in writing
pursuant hereto or in connection herewith or therewith, shall be false
in any material respect on the date as of which made; or
(f) Any Loan Party shall default in the performance of or
compliance with any term contained in this Agreement or the other Loan
Documents, applicable to that Loan Party, other than those referred to
elsewhere in this Section 7 and such default shall not have been
remedied or waived within 30 days after the earlier of (i) receipt
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by the Borrower of notice from any Lender or the Agent of such default
or (ii) the Borrower's knowledge of such default; or
(g) (i) A court having jurisdiction in the premises shall
enter a decree or order for relief in respect of any Loan Party or any
of their respective Subsidiaries in an involuntary case under the
Bankruptcy Code or any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, which decree or order is not
stayed; or any other similar relief shall be granted under any
applicable federal or state law; or (ii) an involuntary case is
commenced against any Loan Party or any of their respective
Subsidiaries under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect; or a decree or order of a court
having jurisdiction in the premises for the appointment of a receiver,
liquidator, sequestrator, trustee, custodian or other officer having
similar powers over any Loan Party or any of their respective
Subsidiaries, or over all or a substantial part of its property, shall
have been entered; or the involuntary appointment of an interim
receiver, trustee or other custodian of any Loan Party or any of their
respective Subsidiaries for all or a substantial part of its property;
or the issuance of a warrant of attachment, execution or similar
process against any substantial part of the property of any Loan Party
or any of their respective Subsidiaries, and the continuance of any
such event in clause (ii) for 60 days unless dismissed, bonded or
discharged; or
(h) Any Loan Party or any of their respective Subsidiaries
shall have an order for relief entered with respect to it or commence a
voluntary case under the Bankruptcy Code or any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or shall
consent to the entry of an order for relief in an involuntary case, or
to the conversion of an involuntary case to a voluntary case, under any
such law, or shall consent to the appointment of or taking possession
by a receiver, trustee or other custodian for all or a substantial part
of its property; the making by any Loan Party or any of their
respective Subsidiaries of any assignment for the benefit of creditors;
or
(i) The inability or failure of any Loan Party or any of their
respective Subsidiaries, or the admission by any Loan Party or any of
their respective Subsidiaries in writing of its inability, to pay its
debts as such debts become due; or the Board of Directors (or any
committee thereof) of any Loan Party or any of their respective
Subsidiaries adopts any resolution or otherwise authorizes action to
approve any of the actions referred to in this clause (i); or
(j) Any money judgment, writ or warrant of attachment, or
similar process involving (i) in any individual case an amount in
excess of $100,000, or (ii) in the aggregate at any time an amount in
excess of $100,000, and in either case not adequately covered by
insurance as to which the insurance company has acknowledged coverage
shall be entered or filed against any Loan Party or any of their
respective Subsidiaries or any of their respective assets and shall
remain undischarged, unvacated, unbonded or unstayed for a period of 30
days or in any event later than five days prior to the date of any
proposed sale thereunder; or
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(k) Any order, judgment or decree shall be entered against any
Loan Party or any of their respective Subsidiaries decreeing a
dissolution or split-up of any Loan Party or any of their respective
Subsidiaries, and such order shall remain undischarged or unstayed for
a period in excess of 30 days; or
(l) There occurs one or more ERISA Events which singly or in
the aggregate results in liability to the Borrower or any ERISA
Affiliate in excess of $100,000; or there exists, as of any valuation
date for a Pension Plan, an excess of the actuarial present value
(determined on the basis of reasonable assumptions employed by the
independent actuary for such Pension Plan) of the benefit liabilities
(as defined in Section 4001(a)(16) of ERISA), whether or not vested
over the fair market value of the assets of such Pension Plan,
individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which
there is no such excess) which exceeds $100,000; or
(m) Any Guaranty for any reason, other than the satisfaction
in full of all Obligations, ceases to be in full force and effect
(other than in accordance with its terms) or is declared to be null and
void, or any Loan Party denies that it has any further liability,
including without limitation with respect to future advances by the
Lenders, under any Loan Document to which it is a party, or gives
notice to such effect; or
(n) Any Security Document shall, at any time, cease to be in
full force and effect (other than by reason of a release of Collateral
in accordance with the terms thereof) or shall be declared null and
void, or the validity or enforceability thereof shall be contested by
any Loan Party or the Agent shall not have or cease to have a valid and
perfected first priority security interest in the Collateral other than
the failure of the Agent or any Lender to take any action within its
control; or
(o) the occurrence and continuance of a default or event of
default under the PCC Existing Credit Agreement (including any
refinancing, amendment and/or restatement thereof) or the refinancing,
amendment, replacement or restatement of the PCC Existing Credit
Agreement on terms and conditions which are not reasonably satisfactory
to the Agent; or
(p) Any event having a Material Adverse Effect shall occur and
such default shall not have been remedied or waived within 30 days
after receipt by the Borrower of notice from any Lender or the Agent of
such default; or
(q) Any of the following shall occur: (i) any Subsidiary of
the Borrower shall issue or have outstanding any Capital Stock (or any
security convertible into any of its Capital Stock) which is not
pledged to the Agent for the benefit of the Lenders in a manner
reasonably satisfactory to the Required Lenders or waived by the Agent
or the Lenders hereunder in accordance with the terms hereof; (ii)
▇▇▇▇▇▇ (or, after his death, collectively, his heirs or estate or both)
shall cease to own and control, directly or indirectly, of record and
beneficially, Capital Stock of the Borrower possessing the
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voting power under normal circumstances to cast 51% or more of the
total votes entitled to be cast for the election of directors of the
Borrower, (iii) ▇▇▇▇▇▇ (or, after his death, collectively, his heirs or
estate or both) shall no longer have the voting power, directly or
indirectly, or the contractual right to elect a majority of the
Borrower's directors and (iv) PCC and PCUH shall cease to own or
control, directly or indirectly, of record and beneficially, Capital
Stock of the Borrower possessing the voting power under normal
circumstances to cast 50% or more of the total votes entitled to be
cast for the election of directors of the Borrower;
then, and in any such event, (A) if such event is an Event of Default specified
in paragraphs (g), (h) or (i) of this Section with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement shall immediately become due and payable, and (B) if such event is any
other Event of Default, either or both of the following actions may be taken:
(i) with the consent of the Required Lenders, the Agent may, or upon the request
of the Required Lenders, the Agent shall, by notice to the Borrower declare the
Commitments to be terminated forthwith, whereupon the Commitments shall
immediately terminate; and (ii) with the consent of the Required Lenders, the
Agent may, or upon the request of the Required Lenders, the Agent shall, by
notice to the Borrower, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement to be due and payable
forthwith, whereupon the same shall immediately become due and payable. Except
as expressly provided above in this Section, presentment, demand, protest and
all other notices of any kind are hereby expressly waived.
SECTION 8. THE AGENT
8.1 Appointment. Each Lender hereby irrevocably designates and appoints
the Agent as the agent of such Lender under this Agreement and the other Loan
Documents, and each such Lender irrevocably authorizes the Agent, in such
capacity, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to the Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere in this Agreement, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Agent.
8.2 Delegation of Duties. The Agent may execute any of its duties under
this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys in-fact selected by it with
reasonable care.
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8.3 Exculpatory Provisions. Neither the Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Agreement or any other Loan Document (except
for its or such Person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower or any officer thereof
contained in this Agreement or any other Loan Document or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Agent under or in connection with, this Agreement or any other Loan
Document or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or for any failure
of the Borrower to perform its obligations hereunder or thereunder. The Agent
shall not be under any obligation to any Lender to ascertain or to inquire as to
the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Borrower.
8.4 Reliance by the Agent. The Agent shall be entitled to rely, and
shall be fully protected in relying, upon any Note, writing, resolution, notice,
consent, certificate, affidavit, letter, telecopy, telex or teletype message,
statement, order or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to the Borrower), independent accountants and other experts
selected by the Agent. The Agent may deem and treat the payee of any Note as the
owner thereof for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Agent. The Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless it shall first receive such advice
or concurrence of the Required Lenders as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Agent shall in all cases be fully protected in acting,
or in refraining from acting, under this Agreement and the other Loan Documents
in accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders and all future holders of the Loans.
8.5 Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default hereunder unless
the Agent has received notice from a Lender or the Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". In the event that the Agent receives such a
notice, the Agent shall give notice thereof to the Lenders. The Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders; provided that unless and until the
Agent shall have received such directions, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.
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8.6 Non-Reliance on the Agent and Other Lenders. Each Lender expressly
acknowledges that neither the Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates has made any representations
or warranties to it and that no act by the Agent hereinafter taken, including
any review of the affairs of the Borrower, shall be deemed to constitute any
representation or warranty by the Agent to any Lender. Each Lender represents to
the Agent that it has, independently and without reliance upon the Agent or any
other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the
Borrower and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon the Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Borrower. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Agent hereunder, the Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of the Borrower which may come into
the possession of the Agent or any of its officers, directors, employees,
agents, attorneys-in-fact or Affiliates.
8.7 Indemnification. The Lenders agree to indemnify the Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Commitment Percentages in effect on the date on which indemnification
is sought (or, if indemnification is sought after the date upon which the
Commitments shall have terminated and the Loans shall have been paid in full,
ratably in accordance with their Commitment Percentages immediately prior to
such date), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including, without limitation, at
any time following the payment of the Loans) be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Agent under
or in connection with any of the foregoing; provided that no Lender shall be
liable for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the Agent's gross negligence or willful misconduct. The
agreements in this subsection shall survive the payment of the Loans and all
other amounts payable hereunder.
8.8 The Agent in Its Individual Capacity. The Agent and its Affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with the Borrower as though the Agent were not the Agent hereunder and
under the other Loan Documents. With respect to the Loans made by it, the Agent
shall have the same rights and powers under this Agreement and the other Loan
Documents as any Lender and may exercise
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the same as though it were not the Agent, and the terms "Lender" and "Lenders"
shall include the Agent in its individual capacity.
8.9 Successor to the Agent. The Agent may resign as the Agent upon 10
days' notice to the Lenders and the Agent may be removed at any time with or
without cause by an instrument or concurrent instruments in writing delivered to
the Borrower and Agent and signed by Required Lenders. If the Agent shall resign
or be removed as the Agent under this Agreement and the other Loan Documents,
then the Required Lenders shall appoint from among the Lenders a successor agent
for the Lenders, which successor agent shall be approved by the Borrower,
whereupon such successor agent shall succeed to the rights, powers and duties of
the Agent, and the term "the Agent" shall mean such successor agent effective
upon such appointment and approval, and the former the Agent's rights, powers
and duties as the Agent shall be terminated, without any other or further act or
deed on the part of such former the Agent or any of the parties to this
Agreement or any holders of the Loans. After any retiring the Agent's
resignation as the Agent, the provisions of this Section 8 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was the
Agent under this Agreement and the other Loan Documents.
SECTION 9. MISCELLANEOUS
9.1 Amendments and Waivers. Neither this Agreement nor any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this subsection. The
Required Lenders may, or, with the written consent of the Required Lenders, the
Agent may, from time to time, (a) enter into with the Borrower written
amendments, supplements or modifications hereto and to the other Loan Documents
for the purpose of adding any provisions to this Agreement or the other Loan
Documents or changing in any manner the rights of the Lenders or of the Borrower
hereunder or thereunder or (b) waive, on such terms and conditions as the
Required Lenders or the Agent, as the case may be, may specify in such
instrument, any of the requirements of this Agreement or the other Loan
Documents or any Default or Event of Default and its consequences; provided,
however, that no such waiver and no such amendment, supplement or modification
shall (i) reduce the amount or extend the scheduled date of maturity of any
scheduled payment of any Loan or of any scheduled installment thereof, or reduce
the stated rate of any interest or fee payable hereunder or extend the scheduled
date of any payment thereof or increase the aggregate amount or extend the
expiration date of any Lender's Commitments, in each case without the consent of
each Lender affected thereby, or (ii) amend, modify or waive any provision of
this subsection or reduce the percentage specified in the definition of Required
Lenders, or consent to the assignment or transfer by the Borrower of any of its
rights and obligations under this Agreement and the other Loan Documents or
release all or substantially all of the Collateral or any material Subsidiary
from the Subsidiaries Guarantee, and in each case without the written consent of
all the Lenders, or (iii) amend, modify or waive any provision of Section 8
without the written consent of the then the Agent. Any such waiver and any such
amendment, supplement, modification or release shall apply equally to each of
the Lenders and shall be binding upon the Borrower, the Lenders, the Agent and
all future holders of the
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Loans. In the case of any waiver, the Borrower, the Lenders and the Agent shall
be restored to their former positions and rights hereunder and under the other
Loan Documents, and any Default or Event of Default waived shall be deemed to be
cured and not continuing; no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any right consequent thereon.
9.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile transmission) and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made (a) in the case of delivery by hand,
when delivered, (b) in the case of delivery by mail, three days after being
deposited in the mails, postage prepaid, or (c) in the case of delivery by
facsimile transmission, when sent and receipt has been confirmed, addressed as
follows in the case of the Borrower and the Agent, and as set forth in Schedule
1.1 in the case of the other parties hereto, or to such other address as may be
hereafter notified by the respective parties hereto:
The Borrower: Travel Channel Acquisition Corporation
c/o Paxson Communications Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ Tek
Fax: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ at the foregoing address
The Agent: Union Bank of California, N.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to ▇▇▇▇ ▇. ▇▇▇▇▇▇ at the foregoing address
provided that any notice, request or demand to or upon the Agent or the Lenders
pursuant to subsection 2.1, 2.2, 2.5, 2.6, 2.7, 2.12 or 9.6 shall not be
effective until received.
9.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay
in exercising, on the part of the Agent or any Lender, any right, remedy, power
or privilege hereunder or under the other Loan Documents shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege. The rights,
remedies, powers and privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers and privileges provided by law.
9.4 Survival of Representations and Warranties. All representations and
warranties made hereunder, in the other Loan Documents and in any document,
certificate or
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statement delivered pursuant hereto or in connection herewith shall survive the
execution and delivery of this Agreement and the making of the Loans hereunder.
9.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Agent for all its reasonable out-of-pocket costs and expenses
incurred in connection with the development, preparation and execution of, and
any amendment, supplement or modification to, this Agreement and the other Loan
Documents and any other documents prepared in connection herewith or therewith,
and the consummation and administration of the transactions contemplated hereby
and thereby, including, without limitation, the reasonable fees and
disbursements of counsel to the Agent, (b) to pay or reimburse each Lender and
the Agent for all its costs and expenses incurred in connection with the
enforcement or preservation of any rights under this Agreement, the other Loan
Documents and any such other documents, including, without limitation, the fees
and disbursements of counsel (including the allocated fees and expenses of
in-house counsel) to each Lender and of counsel to the Agent, (c) to pay,
indemnify, and hold each Lender and the Agent harmless from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise and other taxes (which are
Non-Excluded Taxes), if any, which may be payable or determined to be payable in
connection with the execution and delivery of, or consummation or administration
of any of the transactions contemplated by, or any amendment, supplement or
modification of, or any waiver or consent under or in respect of, this
Agreement, the other Loan Documents and any such other documents, and (d) to
pay, indemnify, and hold each Lender and the Agent harmless from and against any
and all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement, the other Loan Documents and any such other
documents, including, without limitation, any of the foregoing relating to the
violation of, noncompliance with or liability under, any Environmental Law
applicable to the operations of the Borrower, any of its Subsidiaries or any of
its properties or assets (all the foregoing in this clause (d), collectively,
the "indemnified liabilities"), provided, that the Borrower shall have no
obligation under this subsection 9.5 to the Agent or any Lender with respect to
indemnified liabilities arising from the gross negligence or willful misconduct
of the Agent or any such Lender. The agreements in this subsection shall survive
repayment of the Loans and all other amounts payable hereunder.
9.6 Successors and Assigns; Participations and Assignments. (a) This
Agreement shall be binding upon and inure to the benefit of the Borrower, the
Lenders, the Agent and their respective successors and assigns, except that the
Borrower may not assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of each Lender.
(b) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time sell to one or more
banks or other entities ("Participants") participating interests in any Loan
owing to such Lender, any Commitment of such Lender or any other interest of
such Lender hereunder and under the other Loan Documents. In the event of any
such sale by a Lender of a participating interest
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to a Participant, such Lender's obligations under this Agreement to the other
parties to this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain the
holder of any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower and the Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents. The Borrower
agrees that if amounts outstanding under this Agreement are due or unpaid, or
shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall, to the maximum extent
permitted by applicable law, be deemed to have the right of setoff in respect of
its participating interest in amounts owing under this Agreement to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under this Agreement, provided that, in purchasing such
participating interest, such Participant shall be deemed to have agreed to share
with the Lenders the proceeds thereof as provided in subsection 9.7(a) as fully
as if it were a Lender hereunder. The Borrower also agrees that each Participant
shall be entitled to the benefits of subsections 2.14, 2.15, 2.16 with respect
to its participation in the Commitments and the Loans outstanding from time to
time as if it was a Lender; provided that, in the case of subsection 2.15, such
Participant shall have complied with the requirements of said subsection and
provided, further, that no Participant shall be entitled to receive any greater
amount pursuant to any such subsection than the transferor Lender would have
been entitled to receive in respect of the amount of the participation
transferred by such transferor Lender to such Participant had no such transfer
occurred.
(c) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time and from time to
time assign to any Lender or any affiliate thereof or, with the consent of the
Borrower and the Agent (which in each case shall not be unreasonably withheld),
to an additional bank or financial institution ("an Assignee") all or any part
of its rights and obligations under this Agreement and the other Loan Documents
pursuant to an Assignment and Acceptance, substantially in the form of Exhibit
H, executed by such Assignee, such assigning Lender (and, in the case of an
Assignee that is not then a Lender or an affiliate thereof, by the Borrower and
the Agent) and delivered to the Agent for its acceptance and recording in the
Register provided that (i) no such assignment to an Assignee (other than any
Lender or any affiliate thereof) shall be in an aggregate principal amount of
less than $3,000,000 (other than in the case of an assignment of all of a
Lender's interests under this Agreement) and (ii) after giving effect to any
such assignment (other than an assignment of all of a Lender's interests under
this Agreement), the assigning Lender (together with any Lender which is an
affiliate of such assigning Lender) shall retain Loans and/or Commitments
aggregating not less than $3,000,000. Upon such execution, delivery, acceptance
and recording, from and after the effective date determined pursuant to such
Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto
and, to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Lender hereunder with a Commitment as set forth therein,
and (y) the assigning Lender thereunder shall, to the extent provided in such
Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or the remaining
portion of an assigning Lender's rights and obligations under this Agreement,
such assigning Lender shall cease to be a party hereto).
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Notwithstanding any provision of this paragraph (c) and paragraph (e) of this
subsection, the consent of the Borrower shall not be required, and, unless
requested by the Assignee and/or the assigning Lender, new Notes shall not be
required to be executed and delivered by the Borrower, for any assignment which
occurs at any time when any of the events described in paragraphs (g), (h) or
(i) of Section 7 shall have occurred and be continuing.
(d) The Agent, on behalf of the Borrower, shall maintain at the address
of the Agent referred to in subsection 9.2 a copy of each Assignment and
Acceptance delivered to it and a register (the "Register") for the recordation
of the names and addresses of the Lenders and the Commitments of, and principal
amounts of the Loans owing to, each Lender from time to time. The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Agent and the Lenders may (and, in the case of any Loan or other
obligation hereunder not evidenced by a Note, shall) treat each Person whose
name is recorded in the Register as the owner of a Loan or other obligation
hereunder as the owner thereof for all purposes of this Agreement and the other
Loan Documents, notwithstanding any notice to the contrary. Any assignment of
any Loan or other obligation hereunder not evidenced by a Note shall be
effective only upon appropriate entries with respect thereto being made in the
Register. The Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon reasonable prior
notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an Assignee (and, in the case of an Assignee that is not
then a Lender or an affiliate thereof, by the Borrower and the Agent) together
with payment by such Lender or Assignee to the Agent of a registration and
processing fee of $2,500 the Agent shall (i) promptly accept such Assignment and
Acceptance and (ii) on the effective date determined pursuant thereto record the
information contained therein in the Register and give notice of such acceptance
and recordation to the Lenders and the Borrower.
(f) The Borrower authorizes each Lender to disclose to any Participant
or Assignee that agrees to be bound by the terms and conditions of subsection
9.15 (each, a "Transferee") and any prospective Transferee any and all financial
information in such Lender's possession concerning the Borrower and its
Affiliates which has been delivered to such Lender by or on behalf of the
Borrower pursuant to this Agreement or which has been delivered to such Lender
by or on behalf of the Borrower in connection with such Lender's credit
evaluation of the Borrower and its Affiliates prior to becoming a party to this
Agreement.
(g) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this subsection concerning assignments of Loans and Notes
relate only to absolute assignments and that such provisions do not prohibit
assignments creating security interests, including, without limitation, any
pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank
in accordance with applicable law.
9.7 Adjustments; Set-off. (a) If any Lender (a "benefitted Lender")
shall at any time receive any payment of all or part of its Loans, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to
67
61
events or proceedings of the nature referred to in paragraphs (g), (h) or (i) of
Section 7, or otherwise), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of such other
Lender's Loans, or interest thereon, such benefitted Lender shall purchase for
cash from the other Lenders a participating interest in such portion of each
such other Lender's Loan, or shall provide such other Lenders with the benefits
of any such collateral, or the proceeds thereof, as shall be necessary to cause
such benefitted Lender to share the excess payment or benefits of such
collateral or proceeds ratably with each of the Lenders; provided, however, that
if all or any portion of such excess payment or benefits is thereafter recovered
from such benefitted Lender, such purchase shall be rescinded, and the purchase
price and benefits returned, to the extent of such recovery, but without
interest.
(b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to the Borrower, any
such notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to
set-off and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency, and
any other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any branch or agency thereof to or for the
credit or the account of the Borrower. Each Lender agrees promptly to notify the
Borrower and the Agent after any such set-off and application made by such
Lender, provided that the failure to give such notice shall not affect the
validity of such set-off and application.
9.8 Counterparts; Effectiveness. This Agreement may be executed by one
or more of the parties to this Agreement on any number of separate counterparts
(including by facsimile transmission), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument. This
Agreement shall become effective when counterparts hereof shall have been
executed by each of the parties hereto. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the Agent.
9.9 Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
9.10 Integration. This Agreement and the other Loan Documents represent
the agreement of the Borrower, the Agent and the Lenders with respect to the
subject matter hereof, and there are no promises, undertakings, representations
or warranties by the Agent or any Lender relative to subject matter hereof not
expressly set forth or referred to herein or in the other Loan Documents.
68
62
9.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
9.12 Submission To Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to
which it is a party, or for recognition and enforcement of any
judgement in respect thereof, to the non-exclusive general jurisdiction
of the Courts of the State of New York, the courts of the United States
of America for the Southern District of New York, and appellate courts
from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or
that such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to the Borrower at its address set forth in subsection 9.2 or
at such other address of which the Agent shall have been notified
pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall
limit the right to ▇▇▇ in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding
referred to in this subsection any special, exemplary, punitive or
consequential damages.
9.13 Acknowledgements. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents;
(b) neither the Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in
connection with this Agreement or any of the other Loan Documents, and
the relationship between the Agent and the Lenders, on one hand, and
the Borrower, on the other hand, in connection herewith or therewith is
solely that of debtor and creditor; and
69
63
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Lenders or among the Borrower and the
Lenders.
9.14 WAIVERS OF JURY TRIAL. THE BORROWER, THE AGENT AND THE LENDERS
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
9.15 Confidentiality. Each Lender agrees to keep confidential all
non-public information provided to it by the Borrower pursuant to this Agreement
that is designated by the Borrower in writing as confidential; provided that
nothing herein shall prevent any Lender from disclosing any such information (i)
to the Agent or any other Lender, (ii) to any Transferee, (iii) to its
employees, directors, agents, attorneys, accountants and other professional
advisors, (iv) upon the request or demand of any Governmental Authority having
jurisdiction over such Lender, (v) in response to any order of any court or
other Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (vi) which has been publicly disclosed other than in breach
of this Agreement, or (vii) in connection with the exercise of any remedy
hereunder.
70
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
TRAVEL CHANNEL ACQUISITION
CORPORATION
By:/s/
-----------------------------------
Title:
UNION BANK OF CALIFORNIA, N.A.,
as Agent and as a Lender
By:/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
Title: Vice President
71
SCHEDULE 1.1
LENDERS, COMMITMENTS AND ADDRESSES
Term Loan Revolving Credit
LENDER AND ADDRESS Commitment Commitment
UNION BANK OF CALIFORNIA, N.A $22,000,000 $1,000,000
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Contact: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
72
SCHEDULE 3.1(d)
▇▇▇▇▇▇ Communications Unrestricted Holdings, Inc., a Delaware corporation, a
100% directly owned subsidiary of ▇▇▇▇▇▇ Communications Corporation
Travel Channel Acquisition Corporation, a Delaware corporation, a 100% directly
owned subsidiary of ▇▇▇▇▇▇ Communications Unrestricted Holdings, Inc.
73
SCHEDULE 3.1(e)
Real Property
Owned:
None.
Lease:
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
County: DeKalb County, Georgia
Term: Month to Month
1. Lease Agreement between ▇▇▇▇▇▇▇▇ Properties Acquisition Partners,
L.P. and TTC Communications, Inc., dated as of April 20, 1992.
2. First Amendment to Lease between ▇▇▇▇▇▇▇▇ Properties Acquisition
Partners, L.P. and TTC Communications, Inc., dated October 20,
1993.
3. Second Amendment to Lease between ▇▇▇▇▇▇▇▇ Properties Acquisition
Partners, L.P. and TTC Communications, Inc., dated October 14,
1994.
4. Third Amendment to Lease between ▇▇▇▇▇▇▇▇ Properties Acquisition
Partners, L.P. and TTC Communications, Inc., dated December 5,
1994.
5. Fourth Amendment to Lease between ▇▇▇▇▇▇▇▇ Properties Acquisition
Partners, L.P. and TTC Communications, Inc., dated May 23, 1995.
74
SCHEDULE 3.15
Insurance
See Attached.
75
------------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇. CERTIFICATE OF INSURANCE DATE (MM/DD/YY)
7/10/97
------------------------------------------------------------------------------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION
ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE
Aon Risk Services of Florida HOLDER, THIS CERTIFICATE DOES NOT AMEND, EXTEND, OR
7850 W. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Cxwy ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.
Suite 800 -----------------------------------------------------------
▇▇▇▇▇, ▇▇ ▇▇▇▇▇ COMPANIES AFFORDING COVERAGE
▇▇▇-▇▇▇-▇▇▇▇ -----------------------------------------------------------
COMPANY
A Zurich-American Ins, Group
------------------------------------------------------------------------------------------------------------------------------------
INSURED
COMPANY
The Travel Channel Acquisition B
Corporation -----------------------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ COMPANY
▇▇▇▇▇ ▇▇▇ ▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ -----------------------------------------------------------
COMPANY
D
------------------------------------------------------------------------------------------------------------------------------------
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD
INDICATED NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS
CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS,
EXCLUSIONS AND CONDITIONS OF SUCH POLICIES, LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
------------------------------------------------------------------------------------------------------------------------------------
CO TYPE OF INSURANCE POLICY NUMBER POLICY EFFECTIVE POLICY EXPIRATION LIMITS
LTR DATE (MM/DD/YY) DATE (MM/DD/YY)
------------------------------------------------------------------------------------------------------------------------------------
GENERAL AGGREGATE $ 200000
A [X] COMMERCIAL GENERAL LIABILITY CPO6103278 12/31/96 12/31/97 PRODUCTS COMP/OP AGG $ 200000
[ ] CLAIMS MADE [X] OCCUR PERSONAL & ADV INJURY $ 100000
[ ] OWNERS & CONTRACTORS PRO EACH OCCURENCE $ 100000
[ ] ____________________________ FIRE DAMAGE (Any one fire) $ 100000
[ ] MED EXP (Any one person) $ 1000
------------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILE LIABILITY COMBINED SINGLE LIMIT $
[ ] ART AUTO
[ ] ALL OWNED AUTOS BODILY INJURY $
[ ] SCHEDULED AUTOS (Per person)
[ ] HIRED AUTOS BODILY INJURY $
[ ] NON-OWNED AUTOS (Per accident)
[ ] ___________________________
[ ] PROPERTY DAMAGE $
------------------------------------------------------------------------------------------------------------------------------------
GARAGE LIABILITY AUTO ONLY - EA ACCIDENT $
[ ] ANY AUTO OTHER THAN AUTO ONLY:
[ ] ____________________________ EACH ACCIDENT $
[ ] AGGREGATE $
------------------------------------------------------------------------------------------------------------------------------------
EXCESS LIABILITY EACH OCCURENCE $ 100000
[X] UMBRELLA FORM CC8103280 12/31/96 12/31/97 AGGREGATE $ 200000
[ ] OTHER THAN UMBRELLA FORM
------------------------------------------------------------------------------------------------------------------------------------
WORKERS COMPENSATION AND [ ] STATUTORY LIMITS
EMPLOYERS' LIABILITY EACH ACCIDENT $
THE PROPRIETOR/ [ ] INCL.
PARTNERS/EXECUTIVE DISEASE - POLICY LIMIT $
OFFICERS ARE [ ] EXCL. DISEASE - EACH EMPLOYEE $
------------------------------------------------------------------------------------------------------------------------------------
OTHER
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO MAIL
UNION BANK, AS AGENT 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEASE
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ BUT FAILURE TO MAIL SUCH NOTICE SHALL RENDER NO OBLIGATION OR LIABILITY
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
AUTHORIZED REPRESENTATIVE 761723
------------------------------------------------------------------------------------------------------------------------------------
76
▇▇▇▇▇. EVIDENCE OF PROPERTY INSURANCE DATE (MM/DD/YY)
[ ] 7/10/97
THIS IS EVIDENCE THAT INSURANCE AS IDENTIFIED BELOW HAS BEEN ISSUED, IS IN FORCE, AND CONVEYS ALL THE RIGHTS AND PRIVILEGES
UNDER THE POLICY.
------------------------------------------------------------------------------------------------------------------------------------
PRODUCER COMPANY
Asn Risk Services of Florida ZURICH AMERICAN INS OF ILL
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇
CODE SUB-CODE
------------------------------------------------------------------------------------------------------------------------------------
INSURED The Travel Channel Acquisition LOAN NUMER POLICY NUMBER
Corporation CPO8102279
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ EFFECTIVE DATE (MM/DD/YY) EXPIRATION DATE (MM/DD/YY) CONT. INTL
Suite 600 12/31/96 12/21/97 TERMINATED
Atlanta IF CHECKED
GA 30330 THIS REPLACES PRIOR EVIDENCE DATED:
-----------------------------------------------------------------------------------------------------------------------------------
PROPERTY INFORMATION
-----------------------------------------------------------------------------------------------------------------------------------
LOCATION DESCRIPTION Location: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
------------------------------------------------------------------------------------------------------------------------------------
COVERAGE INFORMATION
------------------------------------------------------------------------------------------------------------------------------------
COVERAGE PER AMOUNT OF INSURANCE DEDUCTIBLE
------------------------------------------------------------------------------------------------------------------------------------
Business Inc. incl. Ex. Exp.
Special Causes of Loss 10,000,000
Buildings & Leasehold
Improvements 139,820 5
Business Personal
Property 498,552 5
------------------------------------------------------------------------------------------------------------------------------------
REMARKS FOR SPECIAL CONDITIONS
------------------------------------------------------------------------------------------------------------------------------------
Broadcasting Equipment - $5,501,258/Deductible $5,000
Data Processing Equipment - $489,947/Deductible $5,000
------------------------------------------------------------------------------------------------------------------------------------
CANCELLATION
------------------------------------------------------------------------------------------------------------------------------------
THE POLICY IS SUBJECT TO THE PREMIUMS, FORMS, AND RULES IN EFFECT FOR EACH POLICY PERIOD. SHOULD THE POLICY BE TERMINATED,
THE COMPANY WILL GIVE THE ADDITIONAL INTEREST IDENTIFIED BELOW 30 WRITTEN NOTICE, AND WILL SEND NOTIFICATION OF ANY
CHANGES TO THE POLICY THAT WOULD AFFECT THAT INTEREST, IN ACCORDANCE WITH THE POLICY PROVISIONS OR AS REQUIRED BY LAW.
------------------------------------------------------------------------------------------------------------------------------------
ADDITIONAL REMARKS
------------------------------------------------------------------------------------------------------------------------------------
NAME AND ADDRESS NATURE OF INTEREST
[X] X MORTGAGE: [ ] ADDITIONAL INSURED
UNION BANK, AS AGENT
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ [X] LOSS PAYEE [ ] (OTHER)__________
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
----------------------------------------
SIGNATURE OF AUTHORIZED AGENT OF COMPANY
77
SCHEDULE 3.16(b)
Intellectual Property
See Attached.
78
Copyrights in all episodes of the following programs:
1. "Designs on Travel"
2. "Etc. . . Etc"
3. "The World Through Celebrities Eyes"
4. "First Impressions"
5. "Great Getaway Game"
6. "Inside Travel"
7. "The Perfect Trip"
8. "Sense of Place"
9. "United States"
10. "▇▇▇▇▇▇ ▇▇▇▇▇▇▇'▇ Almanac of Travel"
11. "Countries of the World"
12. "On the Agenda"
79
====================================================================================================================================
Monday, June 09, 1997 Client Status Report Page: 1
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ 74/082821 1681684 WSB Sec. 8 Deadline 31-Mar-1998
Registered 30-Jul-1990 31-Mar-1992 JSP Renewal Earliest Date ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. WXB Next Renewal 31-Mar-2002
Classes: 041 Grade Period Ends 30-Jun-2002
Goods: Entertainment services in the nature of a television program
series featuring travel information
Remarks: Additionally Attorney(s): THD THD
First Use In Commerce: 11/26/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Natn-1 Class(es): 107
Service ▇▇▇▇: Supplemental Register
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
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DESIGNS ON TRAVEL T07621 74/082822 1692008 WSB Sec. 8 Deadline 09-Jun-1998
Registered 30-Jul-1990 09-Jun-1992 JSP Renewal Earliest Date 09-Dec-2001
United States of America Owner: The Travel Channel, Inc. LJL Next Renewal 09-Jun-2002
Classes: 041 Grace Period Ends 09-Sep-2002
Goods: Entertainment services in the nature of a televised program
series featuring travel information
Remarks: Disclaimer: "travel"
First Use In Commerce: 4/18/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
80
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Monday, June 09, 1997 Client Status Report Page: 2
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
ETC...ETC... T07624 74/084643 1651090 WSB Sec. 8 Deadline 16-Jul-1997
Registered 03-Aug-1990 16-Jul-1991 JSP Renewal Earliest Date 16-Jan-2001
United States of America Owner: The Travel Channel, Inc. WXB Next Renewal 16-Jul-2001
Classes: 41 Grace Period Ends 16-Oct-2001
Goods: Entertainment services in the nature of a television program
series concerning travel
Remarks: Additionally Attorney(s): THD THD
First Use In Commerce: 4/1/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
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FIRST IMPRESSIONS T07627 74/209918 1741812 WSB Sec. 8/15 Earliest Dt. 22-Dec-1997
Registered 07-Oct-1991 22-Dec-1992 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. WXB Renewal Earliest Date 22-Jun-2002
Classes: 041 Next Renewal 22-Dec-2002
Goods: Entertainment services in the nature of a televised program Grace Period Ends 22-Mar-2003
series featuring travel information
Remarks: Addional Attorney(s): THD THD
First Use In Commerce: 10/1/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Natn-1 Class(es): 107
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
81
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Monday, June 09, 1997 Client Status Report Page: 3
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
NAVIGATOR T07924 74/727084 1985853 WSB Sec. 8/15/ Earliest Dt. 09-Jul-2001
Registered 11-Sep-1995 09-Jul-1996 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. THD Renewal Earliest Date 09-Jan-2006
Classes: 16 Next Renewal 09-Jul-2006
Goods: Monthly televison program guide Grade Period Ends 09-Oct-2006
Remarks:
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
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THE PERFECT TRIP T07625 73/832207 1669767 WSB Sec. 8 Deadline 24-Dec-1997
Registered 18-Oct-1989 24-Dec-1991 JSP Renewal Earliest Date 24-Jun-2001
United States of America Owner: The Travel Channel, Inc. THD Next Renewal 24-Dec-2001
Classes: 041 Grace Period Ends 24-Mar-2002
Goods: Entertainment services in the nature of a televised program
series featuring travel information
Remarks: Additional Attorney(s) LJL LJL
First Use In Commerce: 3/19/87
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Natn-1 Class(es): 107
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
82
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Monday, June 09, 1997 Client Status Report Page: 4
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 74/688681 1982443 WSB Sec. 8/15 Earliest Dt. 25-Jun-2001
Registered 14-Jun-1995 25-Jun-1996 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. WXB Renewal Earliest Date 25-Dec-2005
Classes: 038 & 041 Next Renewal 25-Jun-2006
Goods: Cable televison broadcasting services (C1.38); producing Grace Period Ends 25-Sep-2006
television programs (C1.41)
Remarks: Disclaimer: "channel"
First Use In Commerce: 10/13/86
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
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THE TRAVEL CHANNEL T07622 73/308959 1205086 WSB Renewal Earliest Date 10-Feb-2002
Registered 06-May-1981 10-Aug-1982 JSP Next Renewal 10-Aug-2002
United States of America Owner: The Travel Channel, Inc. WXB Grace Period Ends 10-Nov-2002
Classes: 038
Goods: Broadasting services to cable television systems by the
way of satellite
Remarks: Disclaimer: "channel"
First Use In Commerce: 4/1/81
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇; Supplemental Register
Client: T242 The Travel Channel, Inc.
Registrant: The Travel Channel, Inc.
83
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Monday, June 09, 1997 Client Status Report Page: 5
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
THE TRAVEL CHANNEL AND DESIGN T07814 74/688684 1980990 JSP Sec. 8/15 Earliest Dt. 18-Jun-2001
Registered 14-Jun-1995 18-Jun-1996 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. THD Renewal Earliest Date 18-Dec-2005
Classes: 038 & 041 Next Renewal 18-Jun-2006
Goods: Cable television broadcasting services (C1.38); producing Grade Period Ends 18-Sep-2006
televison programs (C1.41)
Remarks: Disclaimer: "channel"
First Use In Commerce: 5/1/93
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
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THE TRAVEL CHANNEL AND DESIGN 081990 73/684289 1522924 WSB Renewal Earliest Date 31-Jul-2008
Registered 14-Sep-1987 31-Jan-1989 JSP Next Renewal 31-Jan-2009
WXB Grace Period Ends 30-Apr-2009
United States of America Owner: The Travel Channel, Inc.
Classes: 38, 39, 41 & 42
Goods: Cable television/broadcasting (C1.38); travel agency
services (C1.39); producing tv progams..(C1.41);tv
shopping services (C1.42)
Remarks: Reel/Frame/Date: 1220/0311;9/21/94
Assign./Owner Change: From Travel Marketing Corporation
84
====================================================================================================================================
Monday, June 09, 1997 Client Status Report Page: 6
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
ULTIMATE WORLD TOUR T07995 74/578712 1918300 WSB Sec. 8/15 Earliest Dt. 12-Sep-2000
Registered 26-Sep-1994 12-Sep-1995 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. Renewal Earliest Date 12-Mar-2005
Classes: 35 Next Renewal 12-Sep-2005
Goods: Promoting the sale of goods and services of others by Grace Period Ends 12-Dec-2005
conducting an incentive program
Remarks: First Use In Commerce: 9/1/94
Natn-1 Class(es): 100,101,102
Client: T242 The Travel Channel
Registrant: The Travel Channel
85
SCHEDULE 3.18(b)
UCC Filing Offices
a. File in the following:
Georgia-Secretary of State and DeKalb County
b. Precautionary Statement-Should file in the following:
Virginia-Secretary of State and City of Norfolk
Florida-Secretary of State
86
EXHIBIT A-1
TO THE CREDIT
AGREEMENT
FORM OF REVOLVING CREDIT NOTE
$________ New York, New York
July __, 1997
FOR VALUE RECEIVED, the undersigned, TRAVEL CHANNEL ACQUISITION
CORPORATION, a Delaware corporation (the "Borrower"), hereby unconditionally
promises to pay to the order of [LENDER'S NAME] (the "Lender") at the office of
Union Bank of California, N.A., located at _____________, in lawful money of the
United States of America and in immediately available funds, on the Termination
Date the principal amount of (a) _____________ DOLLARS ($_______), or, if less,
(b) the aggregate unpaid principal amount of all Revolving Credit Loans made by
the Lender to the Borrower pursuant to subsection 2.2 of the Credit Agreement,
as hereinafter defined. The Borrower further agrees to pay interest in like
money at such office on the unpaid principal amount hereof from time to time
outstanding at the rates and on the dates specified in subsections 2.7 and 2.9
of such Credit Agreement.
The holder of this Revolving Credit Note is authorized to endorse on
the schedules annexed hereto and made a part hereof or on a continuation thereof
which shall be attached hereto and made a part hereof the date, Type and amount
of each Revolving Credit Loan made pursuant to the Credit Agreement and the date
and amount of each payment or prepayment of principal thereof, each continuation
thereof, each conversion of all or a portion thereof to another Type and, in the
case of Eurodollar Loans, the length of each Interest Period with respect
thereto. Each such endorsement shall constitute prima facie evidence of the
accuracy of the information endorsed. The failure to make any such endorsement
shall not affect the obligations of the Borrower in respect of such Revolving
Credit Loan.
This Revolving Credit Note (a) is one of the Revolving Credit Notes
referred to in the Credit Agreement dated as of July __, 1997 (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among the Borrower, the Lender, the other banks and financial institutions from
time to time parties thereto and Union Bank of California, N.A., as agent, (b)
is subject to the provisions of the Credit Agreement and (c) is subject to
optional and mandatory prepayment in whole or in part as provided in the Credit
Agreement. This Revolving Credit Note is secured and guaranteed as provided in
the Loan Documents. Reference is hereby made to the Loan Documents for a
description of the properties and assets in which a security interest has been
granted, the nature and extent of the security and the guarantees, the terms and
conditions upon which the security interests and each guarantee were granted and
the rights of the holder of this Revolving Credit Note in respect thereof.
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2
Upon the occurrence of any one or more of the Events of Default, all
amounts then remaining unpaid on this Revolving Credit Note shall become, or may
be declared to be, immediately due and payable, all as provided in the Credit
Agreement.
All parties now and hereafter liable with respect to this Revolving
Credit Note, whether maker, principal, surety, guarantor, endorser or otherwise,
hereby waive presentment, demand, protest and all other notices of any kind.
Unless otherwise defined herein, terms defined in the Credit Agreement
and used herein shall have the meanings given to them in the Credit Agreement.
THIS REVOLVING CREDIT NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
TRAVEL CHANNEL ACQUISITION
CORPORATION
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
88
Schedule A
to Revolving Credit Note
LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS
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Amount Amount of Principal Amount of Base Rate Unpaid Principal
Amount of Base Rate Converted to of Base Rate Loans Loans Converted to Balance of Base Notation Made
Date Loans Base Rate Loans Repaid Eurodollar Loans Rate Loans By
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89
Schedule B
to Revolving Credit Note
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS
------------------------------------------------------------------------------------------------------------------------------------
Amount Interest Period Amount of Amount of
Amount of Converted to and Eurodollar Principal of Eurodollar Loans Unpaid Principal
Eurodollar Eurodollar Rate with Eurodollar Loans Converted to Balance of Notation
Date Loans Loans Respect Thereto Repaid Base Rate Loans Eurodollar Loans Made By
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90
EXHIBIT A-2 TO THE
CREDIT AGREEMENT
FORM OF TERM NOTE
$_________ New York, New York
July __, 1997
FOR VALUE RECEIVED, the undersigned, TRAVEL CHANNEL ACQUISITION
CORPORATION, a [ ] corporation (the "Borrower"), hereby unconditionally
promises to pay to the order of [LENDER'S NAME] (the "Lender") at the office of
Union Bank of California, N.A., located at _______________________________, in
lawful money of the United States of America and in immediately available funds
on the Termination Date, the principal amount of (a) __________ DOLLARS
($_______ ), or, if less, (b) the unpaid principal amount of all Term Loans made
by the Lender pursuant to subsection 2.1 of the Credit Agreement, as hereinafter
defined. The Borrower further agrees to pay interest in like money at such
office on the unpaid principal amount hereof from time to time outstanding at
the rates and on the dates specified in subsections 2.7 and 2.9 of such Credit
Agreement.
The holder of this Term Note is authorized to endorse on the schedules
annexed hereto and made a part hereof or on a continuation thereof which shall
be attached hereto and made a part hereof the date, Type and amount of the Term
Loan and the date and amount of each payment or prepayment of principal thereof,
each conversion of all or a portion thereof to another Type, each continuation
thereof and, in the case of Eurodollar Loans, the length of each Interest Period
with respect thereto. Each such endorsement shall constitute prima facie
evidence of the accuracy of the information endorsed. The failure to make any
such endorsement shall not affect the obligations of the Borrower in respect of
such Term Loan.
This Term Note (a) is one of the Term Notes referred to in the Credit
Agreement dated as of July __, 1997 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among the Borrower, the
Lender, the other banks and financial institutions from time to time parties
thereto and Union Bank of California, N.A., as agent, (b) is subject to the
provisions of the Credit Agreement and (c) is subject to optional and mandatory
prepayment in whole or in part as provided in the Credit Agreement. This Term
Note is secured and guaranteed as provided in the Loan Documents. Reference is
hereby made to the Loan Documents for a description of the properties and assets
in which a security interest has been granted, the nature and extent of the
security and the guarantees, the terms and conditions upon which the security
interests and each guarantee were granted and the rights of the holder of this
Term Note in respect thereof.
Upon the occurrence of any one or more of the Events of Default, all
amounts then remaining unpaid on this Term Note shall become, or may be declared
to be, immediately due and payable, all as provided in the Credit Agreement.
91
2
All parties now and hereafter liable with respect to this Term Note,
whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind.
Unless otherwise defined herein, terms defined in the Credit Agreement
and used herein shall have the meanings given to them in the Credit Agreement.
THIS TERM NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK.
TRAVEL CHANNEL ACQUISITION
CORPORATION
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
92
Schedule A
to Term Note
LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS
------------------------------------------------------------------------------------------------------------------------------------
Amount Amount of Principal Amount of Base Rate Unpaid Principal
Amount of Base Rate Converted to of Base Rate Loans Loans Converted to Balance of Base Notation Made
Date Loans Base Rate Loans Repaid Eurodollar Loans Rate Loans By
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93
Schedule B
to Term Note
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS
------------------------------------------------------------------------------------------------------------------------------------
Amount Interest Period Amount of Amount of
Amount of Converted to and Eurodollar Principal of Eurodollar Loans Unpaid Principal
Eurodollar Eurodollar Rate with Eurodollar Loans Converted to Balance of Notation
Date Loans Loans Respect Thereto Repaid Base Rate Loans Eurodollar Loans Made By
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94
EXHIBIT B-1
TO THE
CREDIT AGREEMENT
FORM OF ▇▇▇▇▇▇ PLEDGE AGREEMENT
▇▇▇▇▇▇ PLEDGE AGREEMENT, dated as of July __, 1997, made by
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, an individual residing on the date hereof at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, and Second ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited
Partnership, a Nevada limited Partnership (the "Pledgors"), in favor of Union
Bank of California, N.A., as Agent (in such capacity, the "Agent") for the
Lenders parties to the Credit Agreement, dated as of July __, 1997, (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among Travel Channel Acquisition Corporation (the "Borrower"), the Agent and
such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS, the Pledgors are the legal and beneficial owners of the shares
of Pledged Stock (as hereinafter defined) issued by the Issuer (as hereinafter
defined); and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
the Pledgors shall have executed and delivered this Pledge Agreement to the
Agent for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce
the Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans under the Credit Agreement, the Pledgors
hereby agree with the Agent, for the ratable benefit of the Lenders, as follows:
1. Defined Terms. (a) Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": this Pledge Agreement, as the same may be amended,
modified or otherwise supplemented from time to time.
"Code": the Uniform Commercial Code from time to time in effect in the
State of New York.
"Collateral": the Pledged Stock and all Proceeds.
95
2
"Collateral Account": any account established to hold money Proceeds,
maintained under the sole dominion and control of the Agent, subject to
withdrawal by the Agent for the account of the Lenders only as provided in
subsection 8(a).
"Issuer": the company identified on Schedule 1 attached hereto as the
issuer of the Pledged Stock.
"Pledged Stock": the shares of capital stock listed on Schedule 1
hereto, together with all stock certificates, options or rights of any nature
whatsoever that may be issued or granted by the Issuer to the Pledgors in
respect of the Pledged Stock while this Agreement is in effect.
"Proceeds": all "proceeds" as such term is defined in Section 9-306(1)
of the Uniform Commercial Code in effect in the State of New York on the date
hereof and, in any event, shall include, without limitation, all dividends or
other income from the Pledged Stock, collections thereon or distributions with
respect thereto.
"Secured Obligations": the collective reference to (a) the Obligations
and (b) all obligations and liabilities of the Pledgors which may arise under or
in connection with this Agreement or any other Loan Document to which the
Pledgors are a party, whether on account of reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
fees and disbursements of counsel to the Agent or to the Lenders that are
required to be paid by the Pledgors pursuant to the terms of this Agreement or
any other Loan Document to which the Pledgors are a party).
"Securities Act": the Securities Act of 1933, as amended.
"Stockholders' Agreement": the Amended and Restated Stockholders'
Agreement of the Borrower dated as of December 22, 1994, as the same may be
amended, supplemented or otherwise modified from time to time.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section and paragraph
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Pledge; Grant of Security Interest. The Pledgors hereby deliver to
the Agent, for the ratable benefit of the Lenders, all the Pledged Stock and
hereby grant to Agent, for the ratable benefit of the Lenders, a first security
interest in the Collateral, as collateral security for the prompt and complete
payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of the Obligations.
96
3
3. Stock Powers. (a) Concurrently with the delivery to the Agent of
each certificate representing one or more shares of Pledged Stock to the Agent,
the Pledgors shall deliver an undated stock power covering such certificate,
duly executed in blank by the Pledgors with, if the Agent so requests, signature
guaranteed.
(b) The Pledgors shall deliver to the Agent an Acknowledgement and
Consent, substantially in the form of Exhibit A to this Agreement, duly executed
by the Issuer of such Pledged Stock.
4. Representations and Warranties. The Pledgors represent and warrant
that:
(a) All the shares of the Pledged Stock have been duly and validly
issued and are fully paid and nonassessable.
(b) The Pledgors are the record and beneficial owners of, and have good
and marketable title to, the Pledged Stock, free of any and all Liens or options
in favor of, or claims of, any other Person, except the security interest
created by this Agreement and the terms and conditions of the Stockholders'
Agreement; provided that after consideration of the Stockholders' Agreement,
this Agreement and the laws of the State of New York contain adequate remedial
provisions for the practical realization of the rights and benefits purported to
be afforded thereby.
(c) Upon delivery to the Agent of the stock certificates evidencing the
Pledged Stock, the security interest created pursuant to this Agreement will
constitute a valid, perfected first priority security interest in the
Collateral, enforceable in accordance with its terms against all creditors of
the Pledgors and any Persons purporting to purchase any Collateral from the
Pledgors, except in each case as enforceability may be affected by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
(d) The Pledgors have obtained from the Issuer and have delivered to
the Agent an Acknowledgement and Consent, substantially in the form attached
hereto as Exhibit A, executed by the Issuer.
5. Covenants. The Pledgors covenant and agree with the Agent and the
Lenders that, from and after the date of this Agreement until this Agreement is
terminated and the security interests created hereby are released:
(a) If the Pledgors shall, as a result of their ownership of the
Pledged Stock, become entitled to receive or shall receive any stock certificate
(including, without limitation, any certificate representing a stock dividend or
a distribution in connection with any reclassification, increase or reduction of
capital or any certificate issued in connection with any reorganization), option
or rights, whether in addition to, in substitution of, as a conversion of, or in
exchange for any shares of the Pledged Stock, or otherwise in respect thereof,
the Pledgors shall accept the same as the agent of the Agent and the Lenders,
hold the same in
97
4
trust for the Agent and the Lenders and deliver the same forthwith to the Agent
in the exact form received, duly indorsed by the Pledgors to the Agent, if
required, together with an undated stock power covering such certificate duly
executed in blank by the Pledgors and with, if the Agent so requests, signature
guaranteed, to be held by the Agent, subject to the terms hereof, as additional
collateral security for the Obligations. Any sums paid upon or in respect of the
Pledged Stock upon the liquidation or dissolution of the Issuer shall be paid
over to the Agent to be held by it hereunder as additional collateral security
for the Obligations, and in case any distribution of capital shall be made on or
in respect of the Pledged Stock or any property shall be distributed upon or
with respect to the Pledged Stock pursuant to the recapitalization or
reclassification of the capital of the Issuer or pursuant to the reorganization
thereof, the property so distributed shall be delivered to the Agent to be held
by it hereunder as additional collateral security for the Obligations. If any
sums of money or property so paid or distributed in respect of the Pledged Stock
shall be received by the Pledgors, the Pledgors shall, until such money or
property is paid or delivered to the Agent, hold such money or property in trust
for the Lenders, segregated from other funds of the Pledgors, as additional
collateral security for the Obligations.
(b) Without the prior written consent of the Agent (or except as (i)
expressly permitted under the terms of the PCC Credit Agreement or (ii) provided
under the Stockholders' Agreement), the Pledgors will not (i) sell, assign,
transfer, exchange, or otherwise dispose of, or grant any option with respect
to, the Collateral, (ii) create, incur or permit to exist any Lien or option in
favor of, or any claim of any Person with respect to, any of the Collateral, or
any interest therein, except for the security interests created by this
Agreement or (iii) enter into any agreement or undertaking restricting the right
or ability of the Pledgors or the Agent to sell, assign or transfer any of the
Collateral.
(c) The Pledgors shall maintain the security interest created by this
Agreement as a first, perfected security interest and shall defend such security
interest against claims and demands of all Persons other than the Agent. At any
time and from time to time, upon the written request of the Agent, and at the
sole expense of the Pledgors, the Pledgors will promptly and duly execute and
deliver such further instruments and documents and take such further actions as
the Agent may reasonably request for the purposes of obtaining or preserving the
full benefits of this Agreement and of the rights and powers herein granted. If
any amount payable under or in connection with any of the Collateral shall be or
become evidenced by any promissory note, other instrument or chattel paper, such
note, instrument or chattel paper shall be immediately delivered to the Agent,
duly endorsed if necessary in a manner satisfactory to the Agent, to be held as
Collateral pursuant to this Agreement.
(d) The Pledgors shall pay, and save the Agent and the Lenders harmless
from, any and all liabilities with respect to, or resulting from any delay in
paying, any and all stamp, excise, sales or other taxes and any and all
recording and filing fees which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions
contemplated by this Agreement.
98
5
(e) The Pledgors will not take or omit to take any action, the taking
or the omission of which would result in an alteration or impairment of the
Collateral or the security of this Agreement, except as otherwise expressly
permitted under the terms of the Credit Agreement.
(f) The Pledgors will not enter into any agreement amending or
supplementing the Collateral, except as otherwise expressly permitted under the
terms of the Credit Agreement.
(g) The Pledgors will not waive or release any obligation of any party
to the Collateral, except as otherwise expressly permitted under the terms of
the Credit Agreement.
(h) Unless directed otherwise by the Agent, the Pledgors will exercise
promptly and diligently each and every material right which it may have under
the Collateral (except the right to release or cancel).
(i) The Pledgors will not take or omit to take any action or 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 Collateral.
(j) Upon the occurrence and continuance of an Event of Default, the
Pledgors will give the Agent copies of all material notices (including notices
of default) given or received with respect to the Collateral, promptly after
giving or receiving such notices.
6. Cash Dividends; Voting Rights. Unless an Event of Default shall have
occurred and be continuing and the Agent shall have given notice to the Pledgors
of the Agent's intent to exercise its corresponding rights pursuant to Section 7
below, the Pledgors shall be permitted to receive all cash dividends paid in the
normal course of business of the Issuer and consistent with past practice, to
the extent permitted in the Credit Agreement, in respect of the Pledged Stock
and to exercise all voting and corporate rights with respect to the Pledged
Stock; provided, however, that no vote shall be cast or corporate right
exercised or other action taken which, in the Agent's reasonable judgment, would
impair the Collateral or which would be inconsistent with or result in any
violation of any provision of the Credit Agreement, the Notes, this Agreement or
any other Loan Document.
7. Rights of the Lenders and the Agent. (a) All money Proceeds received
by the Agent hereunder shall be held by the Agent for the benefit of the Lenders
in a Collateral Account. All Proceeds while held by the Agent in a Collateral
Account (or by the Pledgors in trust for the Agent and the Lenders) shall
continue to be held as collateral security for all the Obligations and shall not
constitute payment thereof until applied as provided in subsection 8(a).
(b) If an Event of Default shall occur and be continuing and the Agent
shall give notice of its intent to exercise such rights to the Pledgors, (i) the
Agent shall have the right to receive any and all cash dividends paid in respect
of the Pledged Stock and make application thereof to the Obligations in such
order as the Agent may determine, and (ii) all shares of the Pledged Stock shall
be registered in the name of the Agent or its nominee, and the Agent or its
nominee may thereafter exercise (A) all voting, corporate and other rights
pertaining to
99
6
such shares of the Pledged Stock at any meeting of shareholders of the Issuer or
otherwise and (B) any and all rights of conversion, exchange, subscription and
any other rights, privileges or options pertaining to such shares of the Pledged
Stock as if it were the absolute owner thereof (including, without limitation,
the right to exchange at its discretion any and all of the Pledged Stock upon
the merger, consolidation, reorganization, recapitalization or other fundamental
change in the corporate structure of the Issuer, or upon the exercise by the
Pledgors or the Agent of any right, privilege or option pertaining to such
shares of the Pledged Stock, and in connection therewith, the right to deposit
and deliver any and all of the Pledged Stock with any committee, depositary,
transfer agent, registrar or other designated agency upon such terms and
conditions as the Agent may determine), all without liability except to account
for property actually received by it, but the Agent shall have no duty to the
Pledgors to exercise any such right, privilege or option and shall not be
responsible for any failure to do so or delay in so doing.
8. Remedies. (a) If an Event of Default shall have occurred and be
continuing, at any time at the Agent's election, the Agent may apply all or any
part of Proceeds held in any Collateral Account in payment of the Obligations in
such order as the Agent may elect.
(b) If an Event of Default shall have occurred and be continuing, the
Agent, on behalf of the Lenders, may exercise, in addition to all other rights
and remedies granted in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Obligations, all rights and remedies of
a secured party under the Code. Without limiting the generality of the
foregoing, the Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon the Pledgors or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
assign, give option or options to purchase or otherwise dispose of and deliver
the Collateral or any part thereof (or contract to do any of the foregoing), in
one or more parcels at public or private sale or sales, in the over-the-counter
market, at any exchange, broker's board or office of the Agent or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Agent or any Lender shall have the right upon
any such public sale or sales, and, to the extent permitted by law, upon any
such private sale or sales, to purchase the whole or any part of the Collateral
so sold, free of any right or equity of redemption in the Pledgors, which right
or equity is hereby waived or released. The Agent shall apply any Proceeds from
time to time held by it and the net proceeds of any such collection, recovery,
receipt, appropriation, realization or sale, after deducting all reasonable
costs and expenses of every kind incurred in respect thereof or incidental to
the care or safekeeping of any of the Collateral or in any way relating to the
Collateral or the rights of the Agent and the Lenders hereunder, including,
without limitation, reasonable attorneys' fees and disbursements of counsel to
the Agent, to the payment in whole or in part of the Obligations, in such order
as the Agent may elect, and only after such application and after the payment by
the Agent of any other amount required by any provision of law, including,
without limitation, Section 9-504(1)(c) of the Code, need the Agent account for
the surplus, if any, to the Pledgors. To the extent permitted by
100
7
applicable law, the Pledgors waive all claims, damages and demands they may
acquire against the Agent or any Lender arising out of the exercise by them of
any rights hereunder. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least 10 days before such sale or other disposition. The
Pledgors shall remain liable for any deficiency if the proceeds of any sale or
other disposition of Collateral are insufficient to pay the Obligations and the
fees and disbursements of any attorneys employed by the Agent or any Lender to
collect such deficiency.
(c) The Pledgors waive and agree not to assert any rights or privileges
which they may acquire solely under Section 9-112 of the Code. The Pledgors
shall remain liable for any deficiency if the proceeds of any sale or other
disposition of Collateral are insufficient to pay the Secured Obligations and
the fees and disbursements of any attorneys employed by the Agent or any Lender
to collect such deficiency.
9. Registration Rights; Private Sales. (a) The Pledgors agree to cause
the Issuer to comply with the provisions of the securities or "Blue Sky" laws of
any and all jurisdictions which the Agent shall designate and to make available
to its security holders, as soon as practicable, an earnings statement (which
need not be audited) which will satisfy the provisions of Section 11(a) of the
Securities Act.
(b) The Pledgors recognize that the Agent may be unable to effect a
public sale of any or all the Pledged Stock, by reason of certain prohibitions
contained in the Securities Act and applicable state securities laws or
otherwise, and may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers which will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof. The Pledgors acknowledge and
agree that any such private sale may result in prices and other terms less
favorable than if such sale were a public sale and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner. The Agent shall be under no obligation
to delay a sale of any of the Pledged Stock for the period of time necessary to
permit the Issuer thereof to register such securities for public sale under the
Securities Act, or under applicable state securities laws, even if the Issuer
would agree to do so.
(c) The Pledgors further agree to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales of
all or any portion of the Pledged Stock pursuant to this Section valid and
binding and in compliance with any and all other applicable Requirements of Law.
The Pledgors further agree that a breach of any of the covenants contained in
this Section will cause irreparable injury to the Agent and the Lenders, that
the Agent and the Lenders have no adequate remedy at law in respect of such
breach and, as a consequence, that each and every covenant contained in this
Section shall be specifically enforceable against the Pledgors, and the Pledgors
hereby waive and agree not to assert any defenses against an action for specific
performance of such covenants except for a defense that no Event of Default has
occurred under the Credit Agreement.
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10. Irrevocable Authorization and Instruction to Issuer. The Pledgors
hereby authorize and instruct the Issuer to comply with any instruction received
by it from the Agent in writing that (a) states that an Event of Default has
occurred and (b) is otherwise in accordance with the terms of this Agreement,
without any other or further instructions from the Pledgors, and the Pledgors
agree that the Issuer shall be fully protected in so complying.
11. Agent's Appointment as Attorney-in-Fact. (a) The Pledgors hereby
irrevocably constitute and appoint the Agent and any officer or agent of the
Agent, with full power of substitution, as their true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of the Pledgors and in the name of the Pledgors or in the Agent's own
name, from time to time in the Agent's discretion, for the purpose of carrying
out the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, including, without
limitation, any financing statements, endorsements, assignments or other
instruments of transfer.
(b) The Pledgors hereby ratify all that said attorneys shall lawfully
do or cause to be done pursuant to the power of attorney granted in subsection
11(a). All powers, authorizations and agencies contained in this Agreement are
coupled with an interest and are irrevocable until this Agreement is terminated
and the security interests created hereby are released.
12. Duty of Agent. The Agent's sole duty with respect to the custody,
safekeeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the Code or otherwise, shall be to deal with it in the same
manner as the Agent deals with similar securities and property for its own
account, except that the Agent shall have no obligation to invest funds held in
any Collateral Account and may hold the same as demand deposits. Neither the
Agent, any Lender nor any of their respective directors, officers, employees or
agents shall be liable for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise dispose of any Collateral upon the request of the Pledgors or any
other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof.
13. Execution of Financing Statements. Pursuant to Section 9-402 of the
Code, the Pledgors authorize the Agent to file financing statements with respect
to the Collateral without the signature of the Pledgors in such form and in such
filing offices as the Agent reasonably determines appropriate to perfect the
security interests of the Agent under this Agreement. A carbon, photographic or
other reproduction of this Agreement shall be sufficient as a financing
statement for filing in any jurisdiction.
14. Authority of Agent. The Pledgors acknowledge that the rights and
responsibilities of the Agent under this Agreement with respect to any action
taken by the Agent or the exercise or non-exercise by the Agent of any option,
voting right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the Agent and the
Lenders, be governed by the Credit Agreement and by such other agreements with
respect thereto as may exist from time to time among them, but, as between
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the Agent and the Pledgors, the Agent shall be conclusively presumed to be
acting as agent for the Lenders with full and valid authority so to act or
refrain from acting, and neither the Pledgors nor the Issuer shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.
15. Notices. All notices, requests and demands to or upon the Agent or
the Pledgors to be effective shall be in writing (or by telex, fax or similar
electronic transfer confirmed in writing) and shall be deemed to have been duly
given or made (i) when delivered by hand or (ii) if given by mail, when
deposited in the mails by certified mail, return receipt requested, or (iii) if
by telex, fax or similar electronic transfer, when sent and receipt has been
confirmed, addressed to the Agent or the Pledgors at their address or
transmission number for notices provided on the signature page hereto. The Agent
and the Pledgors may change their addresses and transmission numbers for notices
by notice in the manner provided in this Section.
16. Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
17. Return of Documents; Cooperation. When this Agreement is terminated
and the security interests created hereby are released, the Agent shall (i)
execute and deliver to the Pledgors such documents of assignment as are
reasonably necessary to terminate the Agent's security interest in the
Collateral and (ii) return to the Pledgors the documents delivered to the Agent
as provided in Section 3. If any part of the Collateral is released in
connection with any disposition thereof expressly permitted under the terms of
the Credit Agreement, and the corresponding security interests created hereby
are released, the Agent shall take the actions under clauses (i) and (ii) as
appropriate, with respect to such release.
18. Amendments in Writing; No Waiver; Cumulative Remedies. (a) None of
the terms or provisions of this Agreement may be waived, amended, supplemented
or otherwise modified except by a written instrument executed by the Pledgors
and the Agent, provided that any provision of this Agreement may be waived by
the Agent and the Lenders in a letter or agreement executed by the Agent or by
telex or facsimile transmission from the Agent.
(b) Neither the Agent nor any Lender shall by any act (except by a
written instrument pursuant to subsection 18(a) hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default or in any breach of any of
the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
A waiver by the Agent or any Lender of any right or remedy hereunder on any one
occasion shall not be construed as a bar to any right or remedy which the Agent
or such Lender would otherwise have on any future occasion.
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(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
19. Section Headings. The section headings used in this Agreement are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.
20. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Pledgors and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
21. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
22. Guarantee. (a) Subject to the provisions of paragraph 2 below, the
Pledgors hereby unconditionally and irrevocably guarantee to the Agent, for the
ratable benefit of the Lenders and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by the
Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Obligations.
(b) The Pledgors shall have no personal liability for payment of the
Obligations, and in any action or suit to collect the Obligations the Agent and
the Lenders, for themselves and their respective successors, indorsees,
transferees and assigns, agree that under no circumstances shall any of them
seek, nor shall the Pledgors be subject to, any in personam judgment against the
Pledgors or any judgment for a deficiency but shall look solely to the security
interests hereunder and the collateral described herein for payment of the
Obligations. Nothing contained in this Section shall be construed to impair the
validity of the Obligations or this Agreement or, except as expressly set forth
above, affect or impair in any way the right of the Agent and the Lenders to
exercise their rights and remedies under the Credit Agreement, the Notes and any
other Loan Documents in accordance with their terms.
23. Regulatory Approval. (a) Notwithstanding anything herein to the
contrary, to the extent this Agreement or any other Loan Document purports to
require any Loan Party to grant to the Agent, on behalf of Lenders, a security
interest in the FCC Licenses of any Loan Party now owned or hereafter acquired,
as the case may be, the Agent, on behalf of Lenders, shall only have a security
interest in such FCC Licenses at such times and to the extent that a security
interest in such licenses is permitted under applicable law. Notwithstanding
anything to the contrary set forth herein, the Agent, on behalf of Lenders,
agrees that to the extent prior FCC approval is required pursuant to the
Communications Act for (a) the operation and effectiveness of any grant, right
or remedy hereunder or under the Security Agreements or (b) taking any action
that may be taken by the Agent hereunder or under the Security Agreements, such
grant, right, remedy or actions will be subject to such prior FCC approval
having been obtained by or in favor of the Agent, on behalf of Lenders. The
Borrower agrees that, upon an Event of Default and at the Agent's request, the
Borrower will, and will cause its Subsidiaries to, immediately file, or cause to
be filed, such applications for approval
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and shall take all other and further actions reasonably required by the Agent,
on behalf of Lenders, to obtain such FCC approvals or consents as are necessary
to transfer ownership and control to the Agent, on behalf of Lenders, or their
successors, assigns or designees of the FCC Licenses held by the Borrower, its
License Subsidiaries or any of its other Subsidiaries. To enforce the provisions
of this subsection, the Agent is empowered to request the appointment of a
receiver from any court of competent jurisdiction. Such receiver shall be
instructed to seek from the FCC an involuntary transfer of control of any such
FCC License for the purpose of seeking a bona fide purchaser to whom control
will ultimately be transferred. The Borrower hereby agrees to authorize, and to
cause each of its Subsidiaries to authorize, such an involuntary transfer of
control upon the request of the receiver so appointed, and, if the Borrower
shall refuse to authorize or cause any of its Subsidiaries to so authorize the
transfer, its approval may be required by the court. Upon the occurrence and
continuance of an Event of Default, and at the request of the Agent, the
Borrower shall further use its best efforts to assist in obtaining approval of
the FCC, if required, for any action or transactions contemplated by this
Agreement or the other Loan Documents, including, without limitation, the
preparation, execution and filing with the FCC of the assignor's or transferor's
portion of any application or applications for consent to the assignment of any
FCC License or transfer of control necessary or appropriate under the FCC's
rules and regulations for approval of the transfer or assignment of any portion
of the Collateral, together with any FCC License or other authorization.
(b) The Borrower acknowledges that the assignment or transfer of such
FCC Licenses is integral to the Lenders' realization of the value of the
Collateral, that there is no adequate remedy at law for failure by the Borrower
to comply with the provisions of this Section 24 and that such failure would not
be adequately compensable in damages, and therefore agrees that the agreements
contained in this Section 24 may be specifically enforced.
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(c) Notwithstanding anything to the contrary contained in this
Agreement or any other Loan Document, neither the Agent nor any Lender shall,
without first obtaining the approval of the FCC, take any action pursuant to
this Agreement or any other Loan Document which would constitute or result in
any assignment of an FCC License or any change of control of the Borrower or any
of its Subsidiaries if such assignment or change in control would require, under
then existing law (including the written rules and regulations promulgated by
the FCC), the prior approval of the FCC.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
duly executed and delivered as of the date first above written.
By:
-----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
SECOND ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
LIMITED PARTNERSHIP
By: ▇▇▇▇▇▇ ENTERPRISES, INC.,
a Nevada corporation, as managing
general partner
By:
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
President
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
107
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Pledge
Agreement dated July 11, 1997 made by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and Second ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Limited Partnership for the benefit of Union Bank of California, N.A.,
as Agent (the "Pledge Agreement"). The undersigned agrees for the benefit of the
Agent and the Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement
and will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Agent promptly in writing of the
occurrence of any of the events described in subsection 5(a) of the Pledge
Agreement.
3. The terms of subsection 9(c) of the Pledge Agreement shall apply to
it, mutatis mutandis, with respect to all actions that may be required of it
under or pursuant to or arising out of Section 9 of the Pledge Agreement.
▇▇▇▇▇▇ COMMUNICATIONS CORPORATION
By:
-----------------------------
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
108
SCHEDULE 1
TO ▇▇▇▇▇▇
PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Stock Certificate
Issuer Class of Stock* No. No. of Shares
----------------------------------------- -------------------- ------------------------ --------------------
▇▇▇▇▇▇ Communications Common 0733 207,624
Corporation
▇▇▇▇▇▇ Communications Common PCC1097 2,000,000
Corporation
▇▇▇▇▇▇ Communications Common PCC1100 1,000,000
Corporation
▇▇▇▇▇▇ Communications Common 472,376(1)
Corporation
--------
(1) Additional pledge of 472,376 shares to be consummated post-closing. The
Agent may complete the missing information regarding "Stock Certificate No."
after such additional pledge takes place.
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EXHIBIT B-2
TO THE
CREDIT AGREEMENT
FORM OF PCUH PLEDGE AGREEMENT
PCUH PLEDGE AGREEMENT, dated as of July __, 1997, made by
▇▇▇▇▇▇ Communications Unrestricted Holdings, Inc., a Delaware corporation (the
"Pledgor"), in favor of Union Bank of California, N.A., as Agent (in such
capacity, the "Agent") for the Lenders parties to the Credit Agreement, dated as
of July __, 1997, (as amended, supplemented or otherwise modified from time to
time, the "Credit Agreement"), among Travel Channel Acquisition Corporation (the
"Borrower"), the Agent and such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS, the Pledgor is the legal and beneficial owner of the shares of
Pledged Stock (as hereinafter defined) issued by the Issuers (as hereinafter
defined); and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
the Pledgor shall have executed and delivered this Pledge Agreement to the Agent
for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce
the Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans under the Credit Agreement, the Pledgor
hereby agrees with the Agent, for the ratable benefit of the Lenders, as
follows:
1. Defined Terms. (a) Unless otherwise defined herein, terms defined in
the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": this Pledge Agreement, as the same may be amended,
modified or otherwise supplemented from time to time.
"Code": the Uniform Commercial Code from time to time in effect in the
State of New York.
"Collateral": the Pledged Stock and all Proceeds.
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"Collateral Account": any account established to hold money Proceeds,
maintained under the sole dominion and control of the Agent, subject to
withdrawal by the Agent for the account of the Lenders only as provided in
subsection 8(a).
"Issuers": the collective reference to the companies identified on
Schedule 1 attached hereto as the issuers of the Pledged Stock; individually,
each an "Issuer."
"Pledged Stock": the shares of capital stock listed on Schedule 1
hereto, together with all stock certificates, options or rights of any nature
whatsoever that may be issued or granted by any Issuer to the Pledgor in respect
of the Pledged Stock while this Agreement is in effect.
"Proceeds": all "proceeds" as such term is defined in Section 9-306(1)
of the Uniform Commercial Code in effect in the State of New York on the date
hereof and, in any event, shall include, without limitation, all dividends or
other income from the Pledged Stock, collections thereon or distributions with
respect thereto.
"Secured Obligations": the collective reference to (a) the Obligations
and (b) all obligations and liabilities of the Pledgor which may arise under or
in connection with this Agreement or any other Loan Document to which the
Pledgor is a party, whether on account of reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
fees and disbursements of counsel to the Agent or to the Lenders that are
required to be paid by the Pledgor pursuant to the terms of this Agreement or
any other Loan Document to which the Pledgor is a party).
"Securities Act": the Securities Act of 1933, as amended.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section and paragraph
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Pledge; Grant of Security Interest. The Pledgor hereby delivers to
the Agent, for the ratable benefit of the Lenders, all the Pledged Stock and
hereby grants to Agent, for the ratable benefit of the Lenders, a first security
interest in the Collateral, as collateral security for the prompt and complete
payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of the Obligations.
3. Stock Powers. (a) Concurrently with the delivery to the Agent of
each certificate representing one or more shares of Pledged Stock to the Agent,
the Pledgor shall deliver an undated stock power covering such certificate, duly
executed in blank by the Pledgor with, if the Agent so requests, signature
guaranteed.
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(b) The Pledgor shall deliver to the Agent an Acknowledgement and
Consent, substantially in the form of Exhibit A to this Agreement, duly executed
by the Issuer of such Pledged Stock.
4. Representations and Warranties. The Pledgor represents and warrants
that:
(a) The shares of Pledged Stock constitute all the issued and
outstanding shares of all classes of the capital stock of each Issuer.
(b) All the shares of the Pledged Stock have been duly and validly
issued and are fully paid and nonassessable.
(c) The Pledgor is the record and beneficial owner of, and has good and
marketable title to, the Pledged Stock, free of any and all Liens or options in
favor of, or claims of, any other Person, except the security interest created
by this Agreement.
(d) Upon delivery to the Agent of the stock certificates evidencing the
Pledged Stock, the security interest created pursuant to this Agreement will
constitute a valid, perfected first priority security interest in the
Collateral, enforceable in accordance with its terms against all creditors of
the Pledgor and any Persons purporting to purchase any Collateral from the
Pledgor, except in each case as enforceability may be affected by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
(e) The Pledgor has obtained from each Issuer and has delivered to the
Agent an Acknowledgement and Consent, substantially in the form attached hereto
as Exhibit A, executed by each such Issuer.
(f) The Pledgor is 100% owned by PCC.
5. Covenants. The Pledgor covenants and agrees with the Agent and the
Lenders that, from and after the date of this Agreement until this Agreement is
terminated and the security interests created hereby are released:
(a) If the Pledgor shall, as a result of its ownership of the Pledged
Stock, become entitled to receive or shall receive any stock certificate
(including, without limitation, any certificate representing a stock dividend or
a distribution in connection with any reclassification, increase or reduction of
capital or any certificate issued in connection with any reorganization), option
or rights, whether in addition to, in substitution of, as a conversion of, or in
exchange for any shares of the Pledged Stock, or otherwise in respect thereof,
the Pledgor shall accept the same as the agent of the Agent and the Lenders,
hold the same in trust for the Agent and the Lenders and deliver the same
forthwith to the Agent in the exact form received, duly indorsed by the Pledgor
to the Agent, if required, together with an
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112
4
undated stock power covering such certificate duly executed in blank by the
Pledgor and with, if the Agent so requests, signature guaranteed, to be held by
the Agent, subject to the terms hereof, as additional collateral security for
the Obligations. Any sums paid upon or in respect of the Pledged Stock upon the
liquidation or dissolution of any Issuer shall be paid over to the Agent to be
held by it hereunder as additional collateral security for the Obligations, and
in case any distribution of capital shall be made on or in respect of the
Pledged Stock or any property shall be distributed upon or with respect to the
Pledged Stock pursuant to the recapitalization or reclassification of the
capital of any Issuer or pursuant to the reorganization thereof, the property so
distributed shall be delivered to the Agent to be held by it hereunder as
additional collateral security for the Obligations. If any sums of money or
property so paid or distributed in respect of the Pledged Stock shall be
received by the Pledgor, the Pledgor shall, until such money or property is paid
or delivered to the Agent, hold such money or property in trust for the Lenders,
segregated from other funds of the Pledgor, as additional collateral security
for the Obligations.
(b) Without the prior written consent of the Agent (or except as
expressly permitted under the terms of the Credit Agreement) , the Pledgor will
not (i) vote to enable, or take any other action to permit, any Issuer to issue
any stock or other equity securities of any nature or to issue any other
securities convertible into or granting the right to purchase or exchange for
any stock or other equity securities of any nature of any Issuer, (ii) sell,
assign, transfer, exchange, or otherwise dispose of, or grant any option with
respect to, the Collateral, (iii) create, incur or permit to exist any Lien or
option in favor of, or any claim of any Person with respect to, any of the
Collateral, or any interest therein, except for the security interests created
by this Agreement or (iv) enter into any agreement or undertaking restricting
the right or ability of the Pledgor or the Agent to sell, assign or transfer any
of the Collateral.
(c) The Pledgor shall maintain the security interest created by this
Agreement as a first, perfected security interest and shall defend such security
interest against claims and demands of all Persons other than the Agent. At any
time and from time to time, upon the written request of the Agent, and at the
sole expense of the Pledgor, the Pledgor will promptly and duly execute and
deliver such further instruments and documents and take such further actions as
the Agent may reasonably request for the purposes of obtaining or preserving the
full benefits of this Agreement and of the rights and powers herein granted. If
any amount payable under or in connection with any of the Collateral shall be or
become evidenced by any promissory note, other instrument or chattel paper, such
note, instrument or chattel paper shall be immediately delivered to the Agent,
duly endorsed if necessary in a manner satisfactory to the Agent, to be held as
Collateral pursuant to this Agreement.
(d) The Pledgor shall pay, and save the Agent and the Lenders harmless
from, any and all liabilities with respect to, or resulting from any delay in
paying, any and all stamp, excise, sales or other taxes and any and all
recording and filing fees which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions
contemplated by this Agreement.
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(e) The Pledgor will not take or omit to take any action, the taking or
the omission of which would result in an alteration or impairment of the
Collateral or the security of this Agreement, except as otherwise expressly
permitted under the terms of the Credit Agreement.
(f) The Pledgor will not enter into any agreement amending or
supplementing the Collateral, except as otherwise expressly permitted under the
terms of the Credit Agreement.
(g) The Pledgor will not waive or release any obligation of any party
to the Collateral, except as otherwise expressly permitted under the terms of
the Credit Agreement.
(h) Unless directed otherwise by the Agent, the Pledgor will exercise
promptly and diligently each and every material right which it may have under
the Collateral (except the right to release or cancel).
(i) The Pledgor will not take or omit to take any action or 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 Collateral.
(j) Upon the occurrence and continuance of an Event of Default, the
Pledgor will give the Agent copies of all material notices (including notices of
default) given or received with respect to the Collateral, promptly after giving
or receiving such notices.
6. Cash Dividends; Voting Rights. Unless an Event of Default shall have
occurred and be continuing and the Agent shall have given notice to the Pledgor
of the Agent's intent to exercise its corresponding rights pursuant to Section 7
below, the Pledgor shall be permitted to receive all cash dividends paid in the
normal course of business of the Issuers and consistent with past practice, to
the extent permitted in the Credit Agreement, in respect of the Pledged Stock
and to exercise all voting and corporate rights with respect to the Pledged
Stock; provided, however, that no vote shall be cast or corporate right
exercised or other action taken which, in the Agent's reasonable judgment, would
impair the Collateral or which would be inconsistent with or result in any
violation of any provision of the Credit Agreement, the Notes, this Agreement or
any other Loan Document.
7. Rights of the Lenders and the Agent. (a) All money Proceeds received
by the Agent hereunder shall be held by the Agent for the benefit of the Lenders
in a Collateral Account. All Proceeds while held by the Agent in a Collateral
Account (or by the Pledgor in trust for the Agent and the Lenders) shall
continue to be held as collateral security for all the Obligations and shall not
constitute payment thereof until applied as provided in subsection 8(a).
(b) If an Event of Default shall occur and be continuing and the Agent
shall give notice of its intent to exercise such rights to the Pledgor, (i) the
Agent shall have the right to receive any and all cash dividends paid in respect
of the Pledged Stock and make application thereof to the Obligations in such
order as the Agent may determine, and (ii) all shares of the
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Pledged Stock shall be registered in the name of the Agent or its nominee, and
the Agent or its nominee may thereafter exercise (A) all voting, corporate and
other rights pertaining to such shares of the Pledged Stock at any meeting of
shareholders of any Issuer or otherwise and (B) any and all rights of
conversion, exchange, subscription and any other rights, privileges or options
pertaining to such shares of the Pledged Stock as if it were the absolute owner
thereof (including, without limitation, the right to exchange at its discretion
any and all of the Pledged Stock upon the merger, consolidation, reorganization,
recapitalization or other fundamental change in the corporate structure of any
Issuer, or upon the exercise by the Pledgor or the Agent of any right, privilege
or option pertaining to such shares of the Pledged Stock, and in connection
therewith, the right to deposit and deliver any and all of the Pledged Stock
with any committee, depositary, transfer agent, registrar or other designated
agency upon such terms and conditions as the Agent may determine), all without
liability except to account for property actually received by it, but the Agent
shall have no duty to the Pledgor to exercise any such right, privilege or
option and shall not be responsible for any failure to do so or delay in so
doing.
8. Remedies. (a) If an Event of Default shall have occurred and be
continuing, at any time at the Agent's election, the Agent may apply all or any
part of Proceeds held in any Collateral Account in payment of the Obligations in
such order as the Agent may elect.
(b) If an Event of Default shall have occurred and be continuing, the
Agent, on behalf of the Lenders, may exercise, in addition to all other rights
and remedies granted in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Obligations, all rights and remedies of
a secured party under the Code. Without limiting the generality of the
foregoing, the Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon the Pledgor or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
assign, give option or options to purchase or otherwise dispose of and deliver
the Collateral or any part thereof (or contract to do any of the foregoing), in
one or more parcels at public or private sale or sales, in the over-the-counter
market, at any exchange, broker's board or office of the Agent or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Agent or any Lender shall have the right upon
any such public sale or sales, and, to the extent permitted by law, upon any
such private sale or sales, to purchase the whole or any part of the Collateral
so sold, free of any right or equity of redemption in the Pledgor, which right
or equity is hereby waived or released. The Agent shall apply any Proceeds from
time to time held by it and the net proceeds of any such collection, recovery,
receipt, appropriation, realization or sale, after deducting all reasonable
costs and expenses of every kind incurred in respect thereof or incidental to
the care or safekeeping of any of the Collateral or in any way relating to the
Collateral or the rights of the Agent and the Lenders hereunder, including,
without limitation, reasonable attorneys' fees and disbursements of counsel to
the Agent, to the
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payment in whole or in part of the Obligations, in such order as the Agent may
elect, and only after such application and after the payment by the Agent of any
other amount required by any provision of law, including, without limitation,
Section 9-504(1)(c) of the Code, need the Agent account for the surplus, if any,
to the Pledgor. To the extent permitted by applicable law, the Pledgor waives
all claims, damages and demands it may acquire against the Agent or any Lender
arising out of the exercise by them of any rights hereunder. If any notice of a
proposed sale or other disposition of Collateral shall be required by law, such
notice shall be deemed reasonable and proper if given at least 10 days before
such sale or other disposition. The Pledgor shall remain liable for any
deficiency if the proceeds of any sale or other disposition of Collateral are
insufficient to pay the Obligations and the fees and disbursements of any
attorneys employed by the Agent or any Lender to collect such deficiency.
(c) The Pledgor waives and agrees not to assert any rights or
privileges which it may acquire solely under Section 9-112 of the Code. The
Pledgor shall remain liable for any deficiency if the proceeds of any sale or
other disposition of Collateral are insufficient to pay the Secured Obligations
and the fees and disbursements of any attorneys employed by the Agent or any
Lender to collect such deficiency.
9. Registration Rights; Private Sales. (a) If the Agent shall determine
to exercise its right to sell any or all of the Pledged Stock pursuant to
Section 8(b) hereof, and if in the opinion of the Agent it is necessary or
advisable to have the Pledged Stock, or that portion thereof to be sold,
registered under the provisions of the Securities Act, the Pledgor will cause
the Issuer thereof to (i) execute and deliver, and cause the directors and
officers of such Issuer to execute and deliver, all such instruments and
documents, and do or cause to be done all such other acts as may be, in the
opinion of the Agent, necessary or advisable to register the Pledged Stock, or
that portion thereof to be sold, under the provisions of the Securities Act,
(ii) to use its best efforts to cause the registration statement relating
thereto to become effective and to remain effective for a period of one year
from the date of the first public offering of the Pledged Stock, or that portion
thereof to be sold, and (iii) to make all amendments thereto and/or to the
related prospectus which, in the opinion of the Agent, are necessary or
advisable, all in conformity with the requirements of the Securities Act and the
rules and regulations of the Securities and Exchange Commission applicable
thereto. The Pledgor agrees to cause such Issuer to comply with the provisions
of the securities or "Blue Sky" laws of any and all jurisdictions which the
Agent shall designate and to make available to its security holders, as soon as
practicable, an earnings statement (which need not be audited) which will
satisfy the provisions of Section 11(a) of the Securities Act.
(b) The Pledgor recognizes that the Agent may be unable to effect a
public sale of any or all the Pledged Stock, by reason of certain prohibitions
contained in the Securities Act and applicable state securities laws or
otherwise, and may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers which will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof. The Pledgor acknowledges and
agrees that
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any such private sale may result in prices and other terms less favorable than
if such sale were a public sale and, notwithstanding such circumstances, agrees
that any such private sale shall be deemed to have been made in a commercially
reasonable manner. The Agent shall be under no obligation to delay a sale of any
of the Pledged Stock for the period of time necessary to permit the Issuer
thereof to register such securities for public sale under the Securities Act, or
under applicable state securities laws, even if such Issuer would agree to do
so.
(c) The Pledgor further agrees to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales of
all or any portion of the Pledged Stock pursuant to this Section valid and
binding and in compliance with any and all other applicable Requirements of Law.
The Pledgor further agrees that a breach of any of the covenants contained in
this Section will cause irreparable injury to the Agent and the Lenders, that
the Agent and the Lenders have no adequate remedy at law in respect of such
breach and, as a consequence, that each and every covenant contained in this
Section shall be specifically enforceable against the Pledgor, and the Pledgor
hereby waives and agrees not to assert any defenses against an action for
specific performance of such covenants except for a defense that no Event of
Default has occurred under the Credit Agreement.
10. Irrevocable Authorization and Instruction to Issuer. The Pledgor
hereby authorizes and instructs each Issuer to comply with any instruction
received by it from the Agent in writing that (a) states that an Event of
Default has occurred and (b) is otherwise in accordance with the terms of this
Agreement, without any other or further instructions from the Pledgor, and the
Pledgor agrees that each Issuer shall be fully protected in so complying.
11. Agent's Appointment as Attorney-in-Fact. (a) The Pledgor hereby
irrevocably constitutes and appoints the Agent and any officer or agent of the
Agent, with full power of substitution, as its true and lawful attorney-in-fact
with full irrevocable power and authority in the place and stead of the Pledgor
and in the name of the Pledgor or in the Agent's own name, from time to time in
the Agent's discretion, for the purpose of carrying out the terms of this
Agreement, to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this Agreement, including, without limitation, any financing
statements, endorsements, assignments or other instruments of transfer.
(b) The Pledgor hereby ratifies all that said attorneys shall lawfully
do or cause to be done pursuant to the power of attorney granted in subsection
11(a). All powers, authorizations and agencies contained in this Agreement are
coupled with an interest and are irrevocable until this Agreement is terminated
and the security interests created hereby are released.
12. Duty of Agent. The Agent's sole duty with respect to the custody,
safekeeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the Code or otherwise, shall be to deal with it in the same
manner as the Agent deals with similar
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securities and property for its own account, except that the Agent shall have no
obligation to invest funds held in any Collateral Account and may hold the same
as demand deposits. Neither the Agent, any Lender nor any of their respective
directors, officers, employees or agents shall be liable for failure to demand,
collect or realize upon any of the Collateral or for any delay in doing so or
shall be under any obligation to sell or otherwise dispose of any Collateral
upon the request of the Pledgor or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof.
13. Execution of Financing Statements. Pursuant to Section 9-402 of the
Code, the Pledgor authorizes the Agent to file financing statements with respect
to the Collateral without the signature of the Pledgor in such form and in such
filing offices as the Agent reasonably determines appropriate to perfect the
security interests of the Agent under this Agreement. A carbon, photographic or
other reproduction of this Agreement shall be sufficient as a financing
statement for filing in any jurisdiction.
14. Authority of Agent. The Pledgor acknowledges that the rights and
responsibilities of the Agent under this Agreement with respect to any action
taken by the Agent or the exercise or non-exercise by the Agent of any option,
voting right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the Agent and the
Lenders, be governed by the Credit Agreement and by such other agreements with
respect thereto as may exist from time to time among them, but, as between the
Agent and the Pledgor, the Agent shall be conclusively presumed to be acting as
agent for the Lenders with full and valid authority so to act or refrain from
acting, and neither the Pledgor nor any Issuer shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.
15. Notices. All notices, requests and demands to or upon the Agent or
the Pledgor to be effective shall be in writing (or by telex, fax or similar
electronic transfer confirmed in writing) and shall be deemed to have been duly
given or made (i) when delivered by hand or (ii) if given by mail, when
deposited in the mails by certified mail, return receipt requested, or (iii) if
by telex, fax or similar electronic transfer, when sent and receipt has been
confirmed, addressed to the Agent or the Pledgor at its address or transmission
number for notices provided on the signature page hereto. The Agent and the
Pledgor may change their addresses and transmission numbers for notices by
notice in the manner provided in this Section.
16. Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
17. Return of Documents; Cooperation. (a) When this Agreement is
terminated and the security interests created hereby are released, the Agent
shall (i) execute and deliver to the
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Pledgor such documents of assignment as are reasonably necessary to terminate
the Agent's security interest in the Collateral and (ii) return to the Pledgor
the documents delivered to the Agent as provided in Section 3. If any part of
the Collateral is released in connection with any disposition thereof expressly
permitted under the terms of the Credit Agreement, and the corresponding
security interests created hereby are released, the Agent shall take the actions
under clauses (i) and (ii) as appropriate, with respect to such release.
18. Amendments in Writing; No Waiver; Cumulative Remedies. (a) None of
the terms or provisions of this Agreement may be waived, amended, supplemented
or otherwise modified except by a written instrument executed by the Pledgor and
the Agent, provided that any provision of this Agreement may be waived by the
Agent and the Lenders in a letter or agreement executed by the Agent or by telex
or facsimile transmission from the Agent.
(b) Neither the Agent nor any Lender shall by any act (except by a
written instrument pursuant to subsection 18(a) hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default or in any breach of any of
the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
A waiver by the Agent or any Lender of any right or remedy hereunder on any one
occasion shall not be construed as a bar to any right or remedy which the Agent
or such Lender would otherwise have on any future occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
19. Section Headings. The section headings used in this Agreement are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.
20. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Pledgor and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
21. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
22. Guarantee. (a) Subject to the provisions of paragraph 2 below, the
Pledgor hereby unconditionally and irrevocably guarantees to the Agent, for the
ratable benefit of the Lenders and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by the
Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Obligations.
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(b) The Pledgor shall have no personal liability for payment of the
Obligations, and in any action or suit to collect the Obligations the Agent and
the Lenders shall not seek any in personam judgment against the Pledgor or any
judgment for a deficiency but shall look solely to the security interests
hereunder and the collateral described herein for payment of the Obligations.
Nothing contained in this Section shall be construed to impair the validity of
the Obligations or this Agreement or affect or impair in any way the right of
the Agent and the Lenders to exercise their rights and remedies under the Credit
Agreement, the Notes and any other Loan Documents in accordance with their
terms.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
duly executed and delivered as of the date first above written.
▇▇▇▇▇▇ COMMUNICATIONS
UNRESTRICTED HOLDINGS, INC.
By:
--------------------------------------
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
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121
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Pledge
Agreement dated July 11, 1997 made by ▇▇▇▇▇▇ Communications Unrestricted
Holdings, Inc. for the benefit of Union Bank of California, N.A., as Agent (the
"Pledge Agreement"). The undersigned agrees for the benefit of the Agent and the
Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement
and will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Agent promptly in writing of the
occurrence of any of the events described in subsection 5(a) of the Pledge
Agreement.
3. The terms of subsection 9(c) of the Pledge Agreement shall apply to
it, mutatis mutandis, with respect to all actions that may be required of it
under or pursuant to or arising out of Section 9 of the Pledge Agreement.
TRAVEL CHANNEL ACQUISITION CORPORATION
By:
----------------------------------
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
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122
SCHEDULE 1
TO PCUH
PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Stock Certificate
Issuer Class of Stock* No. No. of Shares
----------------------------------------- --------------- ------------------ -------------
Travel Channel Common ($.01 2 1,000
Acquisition Corporation par value)
------------------------------------
*Stock is assumed to be common stock unless otherwise indicated.
123
EXHIBIT B-3
TO THE
CREDIT AGREEMENT
FORM OF BORROWER PLEDGE AGREEMENT
BORROWER PLEDGE AGREEMENT, dated as of July __, 1997, made by
Travel Channel Acquisition Corporation, a Delaware corporation (the
"Borrower"), in favor of Union Bank of California, N.A., as Agent (in such
capacity, the "Agent") for the Lenders parties to the Credit Agreement, dated
as of July 11, 1997, (as amended, supplemented or otherwise modified from time
to time, the "Credit Agreement"), among the Borrower, the Agent and such
Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS, the Borrower is the legal and beneficial owner of the shares
of Pledged Stock (as hereinafter defined) issued by the Issuers (as hereinafter
defined) and the payee of the Pledged Notes (as hereinafter defined); and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
the Borrower shall have executed and delivered this Pledge Agreement to the
Agent for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce
the Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans under the Credit Agreement, the Borrower
hereby agrees with the Agent, for the ratable benefit of the Lenders, as
follows:
1. Defined Terms. (a) Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given
to them in the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": this Pledge Agreement, as the same may be amended,
modified or otherwise supplemented from time to time.
"Code": the Uniform Commercial Code from time to time in effect in
the State of New York.
"Collateral": the Pledged Stock, the Pledged Notes and all Proceeds.
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2
"Collateral Account": any account established to hold money Proceeds,
maintained under the sole dominion and control of the Agent, subject to
withdrawal by the Agent for the account of the Lenders only as provided in
subsection 10(a).
"Issuers": the collective reference to the companies identified on
Schedule 1 attached hereto as the issuers of the Pledged Stock; individually,
each an "Issuer."
"Obligors": the collective reference to the companies identified on
Schedule 2 hereto, as such Schedule may be amended from time to time.
"Pledged Notes": the promissory note or notes of the Obligors
identified on Schedule 2, together with all substitutes, replacements or
refinancings thereto that may be issued or granted by any Obligor to the
Borrower while this Agreement is in effect.
"Pledged Securities": collectively, the Pledged Notes and the Pledged
Stock.
"Pledged Stock": the shares of capital stock listed on Schedule 1
hereto, together with all stock certificates, options or rights of any nature
whatsoever that may be issued or granted by any Issuer to the Borrower in
respect of the Pledged Stock while this Agreement is in effect.
"Proceeds": all "proceeds" as such term is defined in Section
9-306(1) of the Uniform Commercial Code in effect in the State of New York on
the date hereof and, in any event, shall include, without limitation, all
dividends or other income from the Pledged Stock, collections thereon or
distributions with respect thereto.
"Securities Act": the Securities Act of 1933, as amended.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section and paragraph
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Pledge; Grant of Security Interest. The Borrower hereby delivers
to the Agent, for the ratable benefit of the Lenders, all the Pledged
Securities and hereby grants to Agent, for the ratable benefit of the Lenders,
a first security interest in the Collateral, as collateral security for the
prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations.
3. Stock Powers. (a) Concurrently with the delivery to the Agent of
each certificate representing one or more shares of Pledged Stock to the Agent,
the Borrower shall deliver an undated stock power covering such certificate,
duly executed in blank by the Borrower with, if the Agent so requests,
signature guaranteed.
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3
(b) The Borrower shall deliver to the Agent an Acknowledgement and
Consent, substantially in the form of Exhibit A to this Agreement, duly
executed by the Issuer of such Pledged Stock.
4. Indorsement; Acknowledgement and Consent. Concurrently with the
delivery of each Pledged Note to the Agent pursuant to Section 2 of this
Agreement, such Pledged Note shall be indorsed by the Borrower as follows:
Pay to the order of Bearer
[NAME OF BORROWER]
By: _____________________
Title: ____________________;
5. Payments Under the Pledged Notes. Unless an Event of Default
shall have occurred and be continuing, the Borrower shall be permitted to
receive all regularly scheduled payments of principal and interest under the
Pledged Notes, as such payments become due. If an Event of Default shall occur
and be continuing, and the Agent shall have given notice to the Borrower of the
Agent's intent to exercise its rights pursuant to Section 9 or 10 below, all
payments of principal and interest under the Pledged Notes shall be paid to the
Agent, who shall hold the same as Collateral hereunder. If the Borrower shall
receive any such payments, the Borrower shall hold the same in trust for the
Agent and the Lenders, segregated from other funds of the Borrower, and deliver
the same forthwith to the Agent in the exact form received, duly indorsed by
the Borrower to the Agent, if required.
6. Representations and Warranties. The Borrower represents and
warrants that:
(a) The shares of Pledged Stock constitute all the issued and
outstanding shares of all classes of the capital stock of each Issuer.
(b) All the shares of the Pledged Stock have been duly and validly
issued and are fully paid and nonassessable.
(c) The Pledged Notes of the Borrower listed on Schedule 2 hereto
constitute all of the issued and outstanding promissory notes payable to the
Borrower.
(d) Each Pledged Note and each document and instrument that secures
or guarantees payment of such Pledged Note is, to the best knowledge of the
Borrower, the legal, valid and enforceable obligation of the maker thereof,
except as enforceability may be affected by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of good
faith and fair dealing; none of the Pledged Notes is subject to any right of
counterclaim or offset whatsoever.
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4
(e) The Borrower is the record and beneficial owner of, and has good
and marketable title to, the Pledged Securities, free of any and all Liens or
options in favor of, or claims of, any other Person, except the security
interest created by this Agreement.
(f) Upon delivery to the Agent of the Pledged Notes and the stock
certificates evidencing the Pledged Stock, the security interest created
pursuant to this Agreement will constitute a valid, perfected first priority
security interest in the Collateral, enforceable in accordance with its terms
against all creditors of the Borrower and any Persons purporting to purchase
any Collateral from the Borrower, except in each case as enforceability may be
affected by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
(g) The Borrower has obtained from each Issuer and has delivered
to the Agent an Acknowledgement and Consent, substantially in the form attached
hereto as Exhibit A, executed by each such Issuer.
(h) There exists, to the best knowledge of the Borrower, no default
under any Pledged Note. The principal amount outstanding under each Pledged
Note as of the date hereof is as specified on Schedule 2. Except as described
in Schedule 2, there exists no security interest or guarantee that secures or
supports payment of the indebtedness evidenced by any Pledged Note, and the
descriptions of such security interests and guarantees in Schedule 2 are
complete and accurate in all material respects.
7. Covenants. The Borrower covenants and agrees with the Agent and
the Lenders that, from and after the date of this Agreement until this
Agreement is terminated and the security interests created hereby are released:
(a) If the Borrower shall, as a result of its ownership of the
Pledged Stock, become entitled to receive or shall receive any stock
certificate (including, without limitation, any certificate representing a
stock dividend or a distribution in connection with any reclassification,
increase or reduction of capital or any certificate issued in connection with
any reorganization), option or rights, whether in addition to, in substitution
of, as a conversion of, or in exchange for any shares of the Pledged Stock, or
otherwise in respect thereof, the Borrower shall accept the same as the agent
of the Agent and the Lenders, hold the same in trust for the Agent and the
Lenders and deliver the same forthwith to the Agent in the exact form received,
duly indorsed by the Borrower to the Agent, if required, together with an
undated stock power covering such certificate duly executed in blank by the
Borrower and with, if the Agent so requests, signature guaranteed, to be held
by the Agent, subject to the terms hereof, as additional collateral security
for the Obligations. Any sums paid upon or in respect of the Pledged Stock
upon the liquidation or dissolution of any Issuer shall be paid over to the
Agent to be held by it hereunder as additional collateral security for the
Obligations, and in case any distribution of capital shall be made on or in
respect of the Pledged Stock or any property shall be distributed upon or with
respect to the Pledged Stock pursuant to the recapitalization or
reclassification of the capital of any Issuer or pursuant to
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5
the reorganization thereof, the property so distributed shall be delivered to
the Agent to be held by it hereunder as additional collateral security for the
Obligations. If any sums of money or property so paid or distributed in
respect of the Pledged Stock shall be received by the Borrower, the Borrower
shall, until such money or property is paid or delivered to the Agent, hold
such money or property in trust for the Lenders, segregated from other funds of
the Borrower, as additional collateral security for the Obligations.
(b) Without the prior written consent of the Agent (or except as
expressly permitted under the terms of the Credit Agreement) , the Borrower
will not (i) vote to enable, or take any other action to permit, any Issuer to
issue any stock or other equity securities of any nature or to issue any other
securities convertible into or granting the right to purchase or exchange for
any stock or other equity securities of any nature of any Issuer, (ii) sell,
assign, transfer, exchange, or otherwise dispose of, or grant any option with
respect to, the Collateral, (iii) create, incur or permit to exist any Lien or
option in favor of, or any claim of any Person with respect to, any of the
Collateral, or any interest therein, except for the security interests created
by this Agreement or (iv) enter into any agreement or undertaking restricting
the right or ability of the Borrower or the Agent to sell, assign or transfer
any of the Collateral.
(c) The Borrower shall maintain the security interest created by this
Agreement as a first, perfected security interest and shall defend such
security interest against claims and demands of all Persons other than the
Agent. At any time and from time to time, upon the written request of the
Agent, and at the sole expense of the Borrower, the Borrower will promptly and
duly execute and deliver such further instruments and documents and take such
further actions as the Agent may reasonably request for the purposes of
obtaining or preserving the full benefits of this Agreement and of the rights
and powers herein granted. If any amount payable under or in connection with
any of the Collateral shall be or become evidenced by any promissory note,
other instrument or chattel paper, such note, instrument or chattel paper shall
be immediately delivered to the Agent, duly endorsed if necessary in a manner
satisfactory to the Agent, to be held as Collateral pursuant to this Agreement.
(d) The Borrower shall pay, and save the Agent and the Lenders
harmless from, any and all liabilities with respect to, or resulting from any
delay in paying, any and all stamp, excise, sales or other taxes and any and
all recording and filing fees which may be payable or determined to be payable
with respect to any of the Collateral or in connection with any of the
transactions contemplated by this Agreement.
(e) The Borrower will not take or omit to take any action, the taking
or the omission of which would result in an alteration or impairment of the
Collateral or the security of this Agreement, except as otherwise expressly
permitted under the terms of the Credit Agreement.
(f) The Borrower will not enter into any agreement amending or
supplementing the Collateral, except as otherwise expressly permitted under the
terms of the Credit Agreement.
(g) The Borrower will not waive or release any obligation of any
party to the Collateral, except as otherwise expressly permitted under the
terms of the Credit Agreement.
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(h) Unless directed otherwise by the Agent, the Borrower will
exercise promptly and diligently each and every material right which it may
have under the Collateral (except the right to release or cancel).
(i) The Borrower will not take or omit to take any action or 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 Collateral.
(j) Upon the occurrence and continuance of an Event of Default, the
Borrower will give the Agent copies of all material notices (including notices
of default) given or received with respect to the Collateral, promptly after
giving or receiving such notices.
(k) The Borrower shall deliver to the Agent, in the exact form
received, to be held by the Agent, subject to the terms hereof, as additional
collateral security for the Secured Obligations of the Borrower any additional
promissory notes made by any Obligor for the benefit of the Borrower or other
securities, options or rights received by it in substitution or exchange for,
or as a conversion of, or in addition to, any of the Pledged Notes, or
otherwise in respect thereof, together with an undated endorsement or power, as
the case may be, duly executed to the order of "Bearer" or in blank, as the
case may be, by the Borrower and with, if the Agent reasonably requests,
signature guaranteed.
8. Cash Dividends; Voting Rights. (a) Unless an Event of Default
shall have occurred and be continuing and the Agent shall have given notice to
the Borrower of the Agent's intent to exercise its corresponding rights
pursuant to Section 9 below, the Borrower shall be permitted to receive all
cash dividends paid in the normal course of business of the Issuers and
consistent with past practice, to the extent permitted in the Credit Agreement,
in respect of the Pledged Stock and to exercise all voting and corporate rights
with respect to the Pledged Stock; provided, however, that no vote shall be
cast or corporate right exercised or other action taken which, in the Agent's
reasonable judgment, would impair the Collateral or which would be inconsistent
with or result in any violation of any provision of the Credit Agreement, the
Notes, this Agreement or any other Loan Document.
(b) Unless an Event of Default shall have occurred and be
continuing and the Agent shall have given notice to the Borrower of the Agent's
intent to exercise its corresponding rights pursuant to Section 9 hereof, the
Borrower shall be permitted to receive and retain all scheduled interest and
principal payments on account of the Pledged Notes of the Borrower.
9. Rights of the Lenders and the Agent. (a) All money Proceeds
received by the Agent hereunder shall be held by the Agent for the benefit of
the Lenders in a Collateral Account. All Proceeds while held by the Agent in a
Collateral Account (or by the Borrower in trust for the Agent and the Lenders)
shall continue to be held as collateral security for all the Obligations and
shall not constitute payment thereof until applied as provided in subsection
10(a).
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(b) If an Event of Default shall occur and be continuing and the
Agent shall give notice of its intent to exercise such rights to the Borrower,
(i) the Agent shall have the right to receive any and all cash dividends paid
in respect of the Pledged Stock and make application thereof to the Obligations
in such order as the Agent may determine, and (ii) all shares of the Pledged
Stock shall be registered in the name of the Agent or its nominee, and the
Agent or its nominee may thereafter exercise (A) all voting, corporate and
other rights pertaining to such shares of the Pledged Stock at any meeting of
shareholders of any Issuer or otherwise and (B) any and all rights of
conversion, exchange, subscription and any other rights, privileges or options
pertaining to such shares of the Pledged Stock as if it were the absolute owner
thereof (including, without limitation, the right to exchange at its discretion
any and all of the Pledged Stock upon the merger, consolidation,
reorganization, recapitalization or other fundamental change in the corporate
structure of any Issuer, or upon the exercise by the Borrower or the Agent of
any right, privilege or option pertaining to such shares of the Pledged Stock,
and in connection therewith, the right to deposit and deliver any and all of
the Pledged Stock with any committee, depositary, transfer agent, registrar or
other designated agency upon such terms and conditions as the Agent may
determine), all without liability except to account for property actually
received by it, but the Agent shall have no duty to the Borrower to exercise
any such right, privilege or option and shall not be responsible for any
failure to do so or delay in so doing.
(c) Anything herein to the contrary notwithstanding, the Borrower
shall remain liable under the Pledged Notes to observe and perform all the
conditions and obligations to be observed and performed by it thereunder all in
accordance with the terms and provisions of such Pledged Notes. Neither the
Agent nor the Lenders shall have any obligation or liability under any Pledged
Note by reason of or arising out of this Agreement or the receipt by the Agent
or the Lenders of any payment relating to such Pledged Note pursuant hereto
(other than to account for monies actually received by it), nor shall the Agent
or any of the Lenders be obligated in any manner to perform any of the
obligations of the Borrower under or pursuant to any Pledged Note, to make any
payment, to make any inquiry as to the nature or the sufficiency of any payment
received by it or as to the sufficiency of any performance by any party under
any Pledged Note, to present or file any claim, to take any action to enforce
any performance or to collect the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.
10. Remedies. (a) If an Event of Default shall have occurred and be
continuing, at any time at the Agent's election, the Agent may apply all or any
part of Proceeds held in any Collateral Account in payment of the Obligations
in such order as the Agent may elect.
(b) If an Event of Default shall have occurred and be continuing, the
Agent, on behalf of the Lenders, may exercise, in addition to all other rights
and remedies granted in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Obligations, all rights and remedies of
a secured party under the Code. Without limiting the generality of the
foregoing, the Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon the Borrower or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances
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forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, assign, give option or options to
purchase or otherwise dispose of and deliver the Collateral or any part thereof
(or contract to do any of the foregoing), in one or more parcels at public or
private sale or sales, in the over-the-counter market, at any exchange,
broker's board or office of the Agent or any Lender or elsewhere upon such
terms and conditions as it may deem advisable and at such prices as it may deem
best, for cash or on credit or for future delivery without assumption of any
credit risk. The Agent or any Lender shall have the right upon any such public
sale or sales, and, to the extent permitted by law, upon any such private sale
or sales, to purchase the whole or any part of the Collateral so sold, free of
any right or equity of redemption in the Borrower, which right or equity is
hereby waived or released. The Agent shall apply any Proceeds from time to
time held by it and the net proceeds of any such collection, recovery, receipt,
appropriation, realization or sale, after deducting all reasonable costs and
expenses of every kind incurred in respect thereof or incidental to the care or
safekeeping of any of the Collateral or in any way relating to the Collateral
or the rights of the Agent and the Lenders hereunder, including, without
limitation, reasonable attorneys' fees and disbursements of counsel to the
Agent, to the payment in whole or in part of the Obligations, in such order as
the Agent may elect, and only after such application and after the payment by
the Agent of any other amount required by any provision of law, including,
without limitation, Section 9-504(1)(c) of the Code, need the Agent account for
the surplus, if any, to the Borrower. To the extent permitted by applicable
law, the Borrower waives all claims, damages and demands it may acquire against
the Agent or any Lender arising out of the exercise by them of any rights
hereunder. If any notice of a proposed sale or other disposition of Collateral
shall be required by law, such notice shall be deemed reasonable and proper if
given at least 10 days before such sale or other disposition. The Borrower
shall remain liable for any deficiency if the proceeds of any sale or other
disposition of Collateral are insufficient to pay the Obligations and the fees
and disbursements of any attorneys employed by the Agent or any Lender to
collect such deficiency.
(c) The Borrower waives and agrees not to assert any rights or
privileges which it may acquire solely under Section 9-112 of the Code. The
Borrower shall remain liable for any deficiency if the proceeds of any sale or
other disposition of Collateral are insufficient to pay the Secured Obligations
and the fees and disbursements of any attorneys employed by the Agent or any
Lender to collect such deficiency.
11. Registration Rights; Private Sales. (a) If the Agent shall
determine to exercise its right to sell any or all of the Pledged Stock
pursuant to Section 10(b) hereof, and if in the opinion of the Agent it is
necessary or advisable to have the Pledged Stock, or that portion thereof to be
sold, registered under the provisions of the Securities Act, the Borrower will
cause the Issuer thereof to (i) execute and deliver, and cause the directors
and officers of such Issuer to execute and deliver, all such instruments and
documents, and do or cause to be done all such other acts as may be, in the
opinion of the Agent, necessary or advisable to register the Pledged Stock, or
that portion thereof to be sold, under the provisions of the Securities Act,
(ii) to use its best efforts to cause the registration statement relating
thereto to become effective and to remain effective for a period of one year
from the date of the first public offering of the Pledged Stock, or that
portion thereof to be sold, and (iii) to make all
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amendments thereto and/or to the related prospectus which, in the opinion of
the Agent, are necessary or advisable, all in conformity with the requirements
of the Securities Act and the rules and regulations of the Securities and
Exchange Commission applicable thereto. The Borrower agrees to cause such
Issuer to comply with the provisions of the securities or "Blue Sky" laws of
any and all jurisdictions which the Agent shall designate and to make available
to its security holders, as soon as practicable, an earnings statement (which
need not be audited) which will satisfy the provisions of Section 11(a) of the
Securities Act.
(b) The Borrower recognizes that the Agent may be unable to effect a
public sale of any or all the Pledged Stock, by reason of certain prohibitions
contained in the Securities Act and applicable state securities laws or
otherwise, and may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers which will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof. The Borrower acknowledges
and agrees that any such private sale may result in prices and other terms less
favorable than if such sale were a public sale and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner. The Agent shall be under no
obligation to delay a sale of any of the Pledged Stock for the period of time
necessary to permit the Issuer thereof to register such securities for public
sale under the Securities Act, or under applicable state securities laws, even
if such Issuer would agree to do so.
(c) The Borrower further agrees to use its best efforts to do or
cause to be done all such other acts as may be necessary to make such sale or
sales of all or any portion of the Pledged Stock pursuant to this Section valid
and binding and in compliance with any and all other applicable Requirements of
Law. The Borrower further agrees that a breach of any of the covenants
contained in this Section will cause irreparable injury to the Agent and the
Lenders, that the Agent and the Lenders have no adequate remedy at law in
respect of such breach and, as a consequence, that each and every covenant
contained in this Section shall be specifically enforceable against the
Borrower, and the Borrower hereby waives and agrees not to assert any defenses
against an action for specific performance of such covenants except for a
defense that no Event of Default has occurred under the Credit Agreement.
12. Irrevocable Authorization and Instruction to Issuer. The
Borrower hereby authorizes and instructs each Issuer to comply with any
instruction received by it from the Agent in writing that (a) states that an
Event of Default has occurred and (b) is otherwise in accordance with the terms
of this Agreement, without any other or further instructions from the Borrower,
and the Borrower agrees that each Issuer shall be fully protected in so
complying.
13. Agent's Appointment as Attorney-in-Fact. (a) The Borrower
hereby irrevocably constitutes and appoints the Agent and any officer or agent
of the Agent, with full power of substitution, as its true and lawful
attorney-in- fact with full irrevocable power and authority in the place and
stead of the Borrower and in the name of the Borrower or in the Agent's own
name, from time to time in the Agent's discretion, for the purpose of carrying
out the terms of this Agreement, to take any and all appropriate action and to
execute any and all
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documents and instruments which may be necessary or desirable to accomplish the
purposes of this Agreement, including, without limitation, any financing
statements, endorsements, assignments or other instruments of transfer.
(b) The Borrower hereby ratifies all that said attorneys shall
lawfully do or cause to be done pursuant to the power of attorney granted in
subsection 13(a). All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this Agreement
is terminated and the security interests created hereby are released.
14. Duty of Agent. The Agent's sole duty with respect to the
custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9-207 of the Code or otherwise, shall be to deal with
it in the same manner as the Agent deals with similar securities and property
for its own account, except that the Agent shall have no obligation to invest
funds held in any Collateral Account and may hold the same as demand deposits.
Neither the Agent, any Lender nor any of their respective directors, officers,
employees or agents shall be liable for failure to demand, collect or realize
upon any of the Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral upon the request of
the Borrower or any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof.
15. Execution of Financing Statements. Pursuant to Section 9-402 of
the Code, the Borrower authorizes the Agent to file financing statements with
respect to the Collateral without the signature of the Borrower in such form
and in such filing offices as the Agent reasonably determines appropriate to
perfect the security interests of the Agent under this Agreement. A carbon,
photographic or other reproduction of this Agreement shall be sufficient as a
financing statement for filing in any jurisdiction.
16. Authority of Agent. The Borrower acknowledges that the rights
and responsibilities of the Agent under this Agreement with respect to any
action taken by the Agent or the exercise or non-exercise by the Agent of any
option, voting right, request, judgment or other right or remedy provided for
herein or resulting or arising out of this Agreement shall, as between the
Agent and the Lenders, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Agent and the Borrower, the Agent shall be conclusively presumed
to be acting as agent for the Lenders with full and valid authority so to act
or refrain from acting, and neither the Borrower nor any Issuer shall be under
any obligation, or entitlement, to make any inquiry respecting such authority.
17. Notices. All notices, requests and demands to or upon the Agent
or the Borrower to be effective shall be in writing (or by telex, fax or
similar electronic transfer confirmed in writing) and shall be deemed to have
been duly given or made (i) when delivered by hand or (ii) if given by mail,
when deposited in the mails by certified mail, return receipt requested, or
(iii) if by telex, fax or similar electronic transfer, when sent and receipt
has been confirmed, addressed to the Agent or the Borrower at its address or
transmission number for notices provided in subsection 9.2 of the Credit
Agreement. The Agent and the Borrower
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may change their addresses and transmission numbers for notices by notice in
the manner provided in this Section.
18. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
19. Return of Documents; Cooperation. (a) When this Agreement is
terminated and the security interests created hereby are released, the Agent
shall (i) return to the Borrower the Pledged Notes, (ii) execute and deliver to
the Borrower such documents of assignment as are reasonably necessary to
terminate the Agent's security interest in the Collateral and to advise the
makers of the Pledged Notes of the termination of the Agent's rights and
security interest hereunder and (iii) return to the Borrower the documents
delivered to the Agent as provided in section 3. If any part of the Collateral
is released in connection with any disposition thereof expressly permitted
under the terms of the Credit Agreement, and the corresponding security
interests created hereby are released, the Agent shall take the actions under
clauses (i), (ii) and (iii) as appropriate, with respect to such release.
(b) Upon payment in full of any Pledged Note and payment of the
Proceeds thereof as provided in this Agreement, the Agent shall (i) return to
the Borrower such Pledged Note, indorsed to the Borrower without recourse,
representation or warranty and (ii) execute and deliver to the Borrower such
documents of assignment as are reasonably necessary to terminate the Agent's
security interest in any Collateral related to such Pledged Note.
(c) Upon the occurrence of a default or event of default under any
Pledged Note, the Agent shall cooperate reasonably with the Borrower, at the
expense of the Borrower, in the exercise of the Borrower's rights and remedies
under such Pledged Note and any document or instrument securing or supporting
the same.
20. Amendments in Writing; No Waiver; Cumulative Remedies. (a)
None of the terms or provisions of this Agreement may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
the Borrower and the Agent, provided that any provision of this Agreement may
be waived by the Agent and the Lenders in a letter or agreement executed by the
Agent or by telex or facsimile transmission from the Agent.
(b) Neither the Agent nor any Lender shall by any act (except by a
written instrument pursuant to subsection 20(a) hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default or in any breach of any
of the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Agent or any Lender of any
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right or remedy hereunder on any one occasion shall not be construed as a bar
to any right or remedy which the Agent or such Lender would otherwise have on
any future occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
21. Section Headings. The section headings used in this Agreement
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
22. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Borrower and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
23. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
duly executed and delivered as of the date first above written.
TRAVEL CHANNEL ACQUISITION
CORPORATION
By:
-----------------------
136
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Pledge
Agreement dated July __, 1997 made by Travel Channel Acquisition Corporation
for the benefit of Union Bank of California, N.A., as Agent (the "Pledge
Agreement"). The undersigned agrees for the benefit of the Agent and the
Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement
and will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Agent promptly in writing of the
occurrence of any of the events described in subsection 7(a) of the Pledge
Agreement.
3. The terms of subsection 11(c) of the Pledge Agreement shall apply
to it, mutatis mutandis, with respect to all actions that may be required of it
under or pursuant to or arising out of Section 11 of the Pledge Agreement.
[ ]
By: _____________________________
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
137
SCHEDULE 1
TO BORROWER
PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Stock Certificate
Issuer Class of Stock* No. No. of Shares
------ --------------- ----------------- -------------
-----------------------------
*Stock is assumed to be common stock unless otherwise indicated.
138
SCHEDULE 2
TO BORROWER
PLEDGE AGREEMENT
THE PLEDGED NOTES
Description of Pledged
Note[s] Collateral Security Guarantee[s]
----------------------------------- --------------------------------- ----------------------------------
[Promissory Note] dated __________, Describe security agreements, Describe each guarantee. If none,
19__, made by _______________ to mortgages, etc. Include recording state "None."
the order of [the Borrower] in the and filing information. If none,
original principal amount of state "None."
$_________
Principal Amount/ Interest
Payment
--------------------------------
Outstanding principal amount:
$__________________
Last date to which interest was
paid: ___________, 199__
139
EXHIBIT C
TO THE
CREDIT AGREEMENT
FORM OF BORROWER SECURITY AGREEMENT
BORROWER SECURITY AGREEMENT, dated as of July __, 1997, made by Travel
Channel Acquisition Corporation, a Delaware corporation, (the "Borrower") in
favor of Union Bank of California, N.A., as Agent (in such capacity, the
"Agent") for the Lenders parties to the Credit Agreement, dated as of July 11,
1997, (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among the Borrower, the Agent and such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein; and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
the Borrower shall have executed and delivered this Security Agreement to the
Agent for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce the
Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans to the Borrower, the Borrower hereby
agrees with the Agent, for the ratable benefit of the Lenders, as follows:
1. Defined Terms.
1.1 Definitions. (a) Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given
to them in the Credit Agreement, and the following terms which are defined in
the Uniform Commercial Code in effect in the State of New York on the date
hereof are used herein as so defined: Accounts, Chattel Paper, Documents,
Equipment, Farm Products, General Intangibles, Instruments, Inventory and
Proceeds.
(b) The following terms shall have the following meanings:
"Agreement": this Security Agreement, as the same may be
amended, supplemented or otherwise modified from time to time.
"Code": the Uniform Commercial Code as from time to time in
effect in the State of New York.
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"Collateral": as defined in Section 2.
"Collateral Account": any collateral account established by
the Agent as provided in subsection 5.3 or subsection 9.2.
"Contracts": all contracts, agreements, instruments and
indentures in any form, and portions thereof, to which the Borrower is
a party or under which the Borrower has any right, title or interest
or to which the Borrower or any property of the Borrower is subject,
as the same may from time to time be amended, supplemented or
otherwise modified, including, without limitation, (a) all rights of
the Borrower to receive moneys due and to become due to it thereunder
or in connection therewith, (b) all rights of the Borrower to damages
arising out of, or for, breach or default in respect thereof and (c)
all rights of the Borrower to perform and to exercise all remedies
thereunder, except, in each case to the extent the grant by the
Borrower of a security interest pursuant to this Agreement in its
right, title and interest in such contract, agreement, instrument or
indenture (i) is prohibited by such contract, agreement, instrument or
indenture without the consent of any other party thereto, (ii) would
give any other party to such contract, agreement, instrument or
indenture the right to terminate its obligations thereunder, or (iii)
is permitted with consent if all necessary consents to such grant of a
security interest have not been obtained from the other parties
thereto (it being understood that the foregoing shall not be deemed to
obligate the Borrower to obtain such consents) (the contracts,
agreements, instruments or indentures referred to in clauses (i), (ii)
and (iii) which, if terminated could reasonably be expected to result
in a Material Adverse Effect, are specified on Schedule 1 attached
hereto); provided, that the foregoing limitation shall not affect,
limit, restrict or impair the grant by the Borrower of a security
interest pursuant to this Agreement in any Account or any money or
other amounts due or to become due under any such contract, agreement,
instrument or indenture.
"Patents": (a) all letters patent of the United States or any
other country and all reissues and extensions thereof, including,
without limitation, any thereof referred to in Schedule 2, and (b) all
applications for letters patent of the United States or any other
country and all divisions, continuations and continuations-in-part
thereof, including, without limitation, any thereof referred to in
Schedule 2.
"Patent License": all agreements, whether written or oral,
providing for the grant by or to the Borrower of any right to
manufacture, use or sell any invention covered by a Patent, including,
without limitation, any thereof referred to in Schedule 2.
"Receivable": any right to payment for goods sold or leased
or for services rendered, whether or not such right is evidenced by an
Instrument or Chattel Paper and whether or not it has been earned by
performance (including, without limitation, any Account).
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"Trademarks": (a) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade
styles, service marks, logos and other source or business identifiers,
and the goodwill associated therewith, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
applications in connection therewith, whether in the United States
Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof or any other country or any political
subdivision thereof, or otherwise, including, without limitation, any
thereof referred to in Schedule 3, and (b) all renewals thereof.
"Trademark License" means any agreement, written or oral,
providing for the grant by or to the Borrower of any right to use any
Trademark, including, without limitation, any thereof referred to in
Schedule 3.
"Vehicles" means all cars, trucks, trailers, construction and
earth moving equipment and other vehicles covered by a certificate of
title law of any state.
1.2 Other Definitional Provisions. (a) The words "hereof,"
"herein", "hereto" and "hereunder" and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement, and Section, subsection and Schedule
references are to this Agreement unless otherwise specified.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Grant of Security Interest. As collateral security for the prompt
and complete payment and performance when due (whether at the stated maturity,
by acceleration or otherwise) of the Obligations, the Borrower hereby grants to
the Agent for the ratable benefit of the Lenders a security interest in all of
the following property now owned or at any time hereafter acquired by the
Borrower or in which the Borrower now has or at any time in the future may
acquire any right, title or interest (collectively, the "Collateral"):
(a) all Accounts;
(b) all Chattel Paper;
(c) all Contracts;
(d) all Documents;
(e) all Equipment;
(f) all General Intangibles;
(g) all Instruments, other than Excluded Investments;
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(h) all Inventory;
(i) all Patents;
(j) all Patent Licenses;
(k) all Trademarks;
(l) all Trademark Licenses;
(m) all Vehicles;
(n) all books, records, ledgercards, files, correspondence,
computer programs, tapes, disks, and related data processing software (owned by
the Borrower or in which it has an interest) that at any time evidence or
contain information relating to any Collateral or are otherwise necessary or
helpful on the collection thereof or realization thereupon; and
(o) to the extent not otherwise included, all Proceeds and products
of any and all of the foregoing and all collateral security and guarantees
given by any Person with respect to any of the foregoing.
3. Representations and Warranties. The Borrower hereby represents
and warrants that:
3.1 Title; No Other Liens. Except for the security interest granted
to the Agent for the ratable benefit of the Lenders pursuant to this Agreement
and the other Liens permitted to exist on the Collateral pursuant to the Credit
Agreement, the Borrower owns each item of the Collateral free and clear of any
and all Liens or claims of others. No financing statement or other public
notice with respect to all or any part of the Collateral is on file or of
record in any public office, except such as have been filed in favor of the
Agent, for the ratable benefit of the Lenders, pursuant to this Agreement or as
are permitted pursuant to the Credit Agreement.
3.2 Perfected First Priority Liens. The security interests granted
pursuant to this Agreement (a) upon completion of the filings and other actions
specified on Schedule 5 will constitute perfected security interests in the
Collateral (other than Vehicles) in favor of the Agent, for the ratable benefit
of the Lenders, as collateral security for the Obligations and (b) are prior to
all other Liens on the Collateral in existence on the date hereof.
3.3 Inventory and Equipment. The Inventory and the Equipment are
kept at the locations listed on Schedule 6.
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3.4 Chief Executive Office. The chief executive office of the
Borrower is located at:
Travel Channel Acquisition Corporation
c/o Paxson Communications Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
3.5 Farm Products. None of the Collateral constitutes, or is the
Proceeds of, Farm Products.
4. Covenants. The Borrower covenants and agrees with the Agent and
the Lenders that, from and after the date of this Agreement until the
Obligations shall have been paid in full and the Commitments shall have expired
or otherwise been terminated:
4.1 Delivery of Instruments and Chattel Paper. If any amount payable
under or in connection with any of the Collateral shall be or become evidenced
by any Instrument or Chattel Paper, such Instrument or Chattel Paper shall be
immediately delivered to the Agent, duly indorsed in a manner satisfactory to
the Agent, to be held as Collateral pursuant to this Agreement.
4.2 Maintenance of Insurance. The Borrower will maintain insurance
on the Collateral as required under the Credit Agreement.
4.3 Maintenance of Perfected Security Interest; Further
Documentation. (a) The Borrower shall maintain the security interest created
by this Agreement as a perfected security interest having at least the priority
described in subsection 3.2 and shall defend such security interest against the
claims and demands of all Persons whomsoever.
(b) At any time and from time to time, upon the written request of
the Agent, and at the sole expense of the Borrower, the Borrower will promptly
and duly execute and deliver such further instruments and documents and take
such further actions as the Agent may reasonably request for the purpose of
obtaining or preserving the full benefits of this Agreement and of the rights
and powers herein granted, including, without limitation, the filing of any
financing or continuation statements under the Uniform Commercial Code in
effect in any jurisdiction with respect to the security interests created
hereby.
4.4 Changes in Locations, Name, etc. The Borrower will not:
(a) permit any of the Inventory or Equipment to be kept at a location
other than those listed on Schedule 6; or
(b) change the location of its chief executive office from that
specified in subsection 3.4, unless it shall have given the Agent and the
Lenders at least 30 days' prior written notice of such change;
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(c) change its name, identity or corporate structure to such an extent
that any financing statement filed by the Agent in connection with this
Agreement would become seriously misleading, unless it shall have given the
Agent and the Lenders at least 30 days' prior written notice of such change.
4.5 Further Identification of Collateral. The Borrower will furnish
to the Agent and the Lenders from time to time statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as the Agent may reasonably request, all in reasonable
detail.
4.6 Notices. The Borrower will advise the Agent and the Lenders
promptly, in reasonable detail, at their respective addresses for notices
provided for in the Credit Agreement of:
(a) any Lien (other than security interests created hereby or Liens
permitted under the Credit Agreement) on any of the Collateral; and
(b) of the occurrence of any other event which could reasonably be
expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.
5. Provisions Relating to Receivables.
5.1 Borrower Remains Liable under Receivables. Anything herein to
the contrary notwithstanding, the Borrower shall remain liable under each of
the Receivables to observe and perform all the conditions and obligations to be
observed and performed by it thereunder, all in accordance with the terms of
any agreement giving rise to each such Receivable. Neither the Agent nor any
Lender shall have any obligation or liability under any Receivable (or any
agreement giving rise thereto) by reason of or arising out of this Agreement or
the receipt by the Agent or any Lender of any payment relating to such
Receivable pursuant hereto, nor shall the Agent or any Lender be obligated in
any manner to perform any of the obligations of the Borrower under or pursuant
to any Receivable (or any agreement giving rise thereto), to make any payment,
to make any inquiry as to the nature or the sufficiency of any payment received
by it or as to the sufficiency of any performance by any party under any
Receivable (or any agreement giving rise thereto), to present or file any
claim, to take any action to enforce any performance or to collect the payment
of any amounts which may have been assigned to it or to which it may be
entitled at any time or times.
5.2 Analysis of Receivables. Upon the occurrence and continuance of
an Event of Default: (a) The Agent shall have the right to make test
verifications of the Receivables in any manner and through any medium that it
reasonably considers advisable, and each Borrower shall furnish all such
assistance and information as the Agent may require in connection with such
test verifications; (b) upon the Agent's request and at the expense of such
Borrower, such Borrower shall cause independent public accountants or others
satisfactory to the Agent to furnish to the Agent reports showing
reconciliations, aging and test verifications of, and trial balances for, the
Receivables; and (c) the Agent in its own name
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or in the name of others may communicate with the obligors on the Receivables
to verify with them to the Agent's satisfaction the existence, amount and terms
of any Receivables.
5.3 Collections on Receivables. (a) The Agent hereby authorizes the
Borrower to collect the Receivables, subject to the Agent's direction and
control, and the Agent may curtail or terminate said authority at any time
after the occurrence and during the continuance of an Event of Default. If
required by the Agent at any time after the occurrence and during the
continuance of an Event of Default, any payments of Receivables, when collected
by the Borrower, (i) shall be forthwith (and, in any event, within two Business
Days) deposited by the Borrower in the exact form received, duly indorsed by
the Borrower to the Agent if required, in a Collateral Account maintained under
the sole dominion and control of the Agent, subject to withdrawal by the Agent
for the account of the Lenders only as provided in subsection 9.3, and (ii)
until so turned over, shall be held by the Borrower in trust for the Agent and
the Lenders, segregated from other funds of the Borrower.
(b) Each such deposit of Proceeds of Receivables shall be accompanied
by a report identifying in reasonable detail the nature and source of the
payments included in the deposit.
(c) Upon the occurrence and continuance of an Event of Default, at
the Agent's request, the Borrower shall deliver to the Agent all original and
other documents evidencing, and relating to, the agreements and transactions
which gave rise to the Receivables, including, without limitation, all original
orders, invoices and shipping receipts.
5.4 Representations and Warranties. (a) No amount payable to the
Borrower under or in connection with any Receivable is evidenced by any
Instrument or Chattel Paper which has not been delivered to the Agent.
(b) None of the obligors on any Receivables is a Governmental
Authority.
(c) The amounts represented by the Borrower to the Lenders from time
to time (upon the Agent's request) as owing to the Borrower in respect of the
Receivables will at such times be accurate in all material respects.
5.5 Covenants. (a) Other than in the ordinary course of business
consistent with its past practice, the Borrower will not (i) grant any
extension of the time of payment of any Receivable, (ii) compromise or settle
any Receivable for less than the full amount thereof, (iii) release, wholly or
partially, any Person liable for the payment of any Receivable, (iv) allow any
credit or discount whatsoever on any Receivable, (v) amend, supplement or
modify any Receivable in any manner that could adversely affect the value
thereof or (vi) fail to exercise promptly and diligently each and every
material right which it may have under each agreement giving rise to a
Receivable (other than any right of termination).
(b) The Borrower will deliver to the Agent a copy of each material
demand, notice or document received by it that questions the validity or
enforceability of more than 5% of the aggregate amount of the then outstanding
Receivables.
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6. Provisions Relating to Contracts.
6.1 Borrower Remains Liable under Contracts. Anything herein to the
contrary notwithstanding, the Borrower shall remain liable under each of the
Contracts to observe and perform all the conditions and obligations to be
observed and performed by it thereunder, all in accordance with and pursuant to
the terms and provisions of such Contract. Neither the Agent nor any Lender
shall have any obligation or liability under any Contract by reason of or
arising out of this Agreement or the receipt by the Agent or any such Lender of
any payment relating to such Contract pursuant hereto, nor shall the Agent or
any Lender be obligated in any manner to perform any of the obligations of the
Borrower under or pursuant to any Contract, to make any payment, to make any
inquiry as to the nature or the sufficiency of any payment received by it or as
to the sufficiency of any performance by any party under any Contract, to
present or file any claim, to take any action to enforce any performance or to
collect the payment of any amounts which may have been assigned to it or to
which it may be entitled at any time or times.
6.2 Communication With Contracting Parties. Upon the occurrence and
continuance of an Event of Default, the Agent in its own name or in the name of
others may communicate with parties to the Contracts to verify with them to the
Agent's satisfaction the existence, amount and terms of any Contracts.
6.3 Representations and Warranties. (a) No consent of any party
(other than the Borrower) to any Contract is required, or purports to be
required, in connection with the execution, delivery and performance of this
Agreement other than any consent that has been received.
(b) Each Contract is in full force and effect and constitutes a valid
and legally enforceable obligation of the parties thereto, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
(c) No consent or authorization of, filing with or other act by or in
respect of any Governmental Authority is required in connection with the
execution, delivery, performance, validity or enforceability of any of the
Contracts by any party thereto other than those which have been duly obtained,
made or performed, are in full force and effect and do not subject the scope of
any such Contract to any material adverse limitation, either specific or
general in nature.
(d) Neither the Borrower nor (to the best of the Borrower's
knowledge) any of the other parties to the Contracts is in default in the
performance or observance of any of the terms thereof in any manner that, in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
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(e) The right, title and interest of the Borrower in, to and under
the Contracts are not subject to any defenses, offsets, counterclaims or claims
that, in the aggregate, could reasonably be expected to have a Material Adverse
Effect.
(f) The Borrower has made available to the Agent a complete and
correct copy of each Contract, including all amendments, supplements and other
modifications thereto.
(g) No amount payable to the Borrower under or in connection with any
Contract is evidenced by any Instrument or Chattel Paper which has not been
delivered to the Agent.
(h) None of the parties to any Contract is a Governmental Authority.
Schedule 1 accurately specifies all contracts, agreements, instruments or
indentures referred to in clauses (i), (ii) and (iii) of the definition of
"Contracts" in subsection 1.1.
6.4 Covenants. Except as otherwise provided in the Credit Agreement:
(a) The Borrower will perform and comply in all material respects with all its
obligations under the Contracts.
(b) The Borrower will not amend, modify, terminate or waive any
provision of any Contract in any manner which could reasonably be expected to
materially adversely affect the value of such Contract as Collateral.
(c) The Borrower will exercise promptly and diligently each and every
material right which it may have under each Contract (other than any right of
termination).
(d) The Borrower will deliver to the Agent a copy of each material
demand, notice or document received by it relating in any way to any Contract
that questions the validity or enforceability of such Contract.
7. Provisions Relating to Patents and Trademarks.
7.1 Representations and Warranties. (a) Schedule 2 includes all
material Patents and Patent Licenses owned by the Borrower in its own name on
the date hereof.
(b) Schedule 3 includes all material Trademarks and Trademark
Licenses owned by the Borrower in its own name on the date hereof.
(c) To the best of the Borrower's knowledge, each such Patent and
Trademark is on the date hereof valid, subsisting, unexpired, enforceable and
has not been abandoned.
(d) Except as set forth in either Schedule 2 or Schedule 3, none of
such Patents and Trademarks is on the date hereof the subject of any licensing
or franchise agreement.
(e) No holding, decision or judgment has been rendered by any
Governmental Authority which would limit, cancel or question the validity of
any Patent or Trademark in any respect that could reasonably be expected to
have a Material Adverse Effect.
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(f) No action or proceeding is pending on the date hereof (i) seeking
to limit, cancel or question the validity of any Patent or Trademark, or (ii)
which, if adversely determined, would have a material adverse effect on the
value of any Patent or Trademark.
7.2 Covenants.
(a) The Borrower (either itself or through licensees) will (i)
continue to use each material Trademark on each and every trademark class of
goods applicable to its current line as reflected in its current catalogs,
brochures and price lists in order to maintain such Trademark in full force
free from any claim of abandonment for non-use, (ii) maintain as in the past
the quality of products and services offered under such Trademark, (iii) employ
such Trademark with the appropriate notice of registration, (iv) not adopt or
use any ▇▇▇▇ which is confusingly similar or a colorable imitation of such
Trademark unless the Agent, for the ratable benefit of the Lenders, shall
obtain a perfected security interest in such ▇▇▇▇ pursuant to this Agreement,
and (v) not (and not permit any licensee or sublicensee thereof to) do any act
or knowingly omit to do any act whereby such Trademark may become invalidated.
(b) The Borrower will not do any act, or omit to do any act, whereby
any material Patent may become abandoned or dedicated.
(c) The Borrower will notify the Agent and the Lenders immediately if
it knows, or has reason to know, that any application or registration relating
to any material Patent or Trademark may become abandoned or dedicated, or of
any adverse determination or development (including, without limitation, the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office or any court or tribunal in any
country) regarding the Borrower's ownership of any material Patent or Trademark
or its right to register the same or to keep and maintain the same.
(d) Whenever the Borrower, either by itself or through any agent,
employee, licensee or designee, shall file an application for the registration
of any Patent or Trademark with the United States Patent and Trademark Office
or any similar office or agency in any other country or any political
subdivision thereof, the Borrower shall report such filing to the Agent and the
Lenders within five Business Days after the last day of the fiscal quarter in
which such filing occurs. Upon request of the Agent, the Borrower shall
execute and deliver any and all agreements, instruments, documents, and papers
as the Agent may request to evidence the Agent's and the Lenders' security
interest in any Patent or Trademark and the goodwill and general intangibles of
the Borrower relating thereto or represented thereby.
(e) The Borrower will take all reasonable and necessary steps,
including, without limitation, in any proceeding before the United States
Patent and Trademark Office, or any similar office or agency in any other
country or any political subdivision thereof, to maintain and pursue each
application (and to obtain the relevant registration) and to maintain each
registration of the material Patents and Trademarks, including, without
limitation, filing of applications for renewal, affidavits of use and
affidavits of incontestability.
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(f) In the event that any Patent or Trademark is infringed,
misappropriated or diluted by a third party, the Borrower shall (i) take such
actions as the Borrower shall reasonably deem appropriate under the
circumstances to protect such Patent or Trademark and (ii) if such Patent or
Trademark is of material economic value, promptly notify the Agent and the
Lenders after it learns thereof and ▇▇▇ for infringement, misappropriation or
dilution, to seek injunctive relief where appropriate and to recover any and
all damages for such infringement, misappropriation or dilution.
8. Provisions Relating to Vehicles.
8.1 Representation and Warranty. Upon the occurrence and continuance
of an Event of Default, upon the request of the Agent, the Borrower shall
provide within 20 days of such request a complete and correct list of all
Vehicles owned by the Borrower on such date.
8.2 Covenants.
(a) Upon the occurrence and continuance of an Event of Default, no
Vehicle shall be removed from the state which has issued the certificate of
title/ownership therefor for a period in excess of 30 days.
(b) Within 30 days of the date of the Agent's request, all
applications for certificates of title/ownership indicating the Agent's first
priority security interest in the Vehicle covered by such certificate, and any
other necessary documentation, shall be filed in each office in each
jurisdiction which the Agent shall deem advisable to perfect its security
interests in the Vehicles.
9. Remedies.
9.1 Notice to Obligors and Contract Parties. Upon the request of the
Agent at any time after the occurrence and during the continuance of an Event
of Default, the Borrower shall notify obligors on the Receivables and parties
to the Contracts that the Receivables and the Contracts have been assigned to
the Agent for the ratable benefit of the Lenders and that payments in respect
thereof shall be made directly to the Agent.
9.2 Proceeds to be Turned Over To Agent. In addition to the rights
of the Agent and the Lenders specified in subsection 5.3 with respect to
payments of Receivables, if an Event of Default shall occur and be continuing,
upon written notice from the Agent, all Proceeds received by the Borrower
consisting of cash, checks and other near-cash items shall be held by the
Borrower in trust for the Agent and the Lenders, segregated from other funds of
the Borrower, and shall, forthwith upon receipt by the Borrower, be turned over
to the Agent in the exact form received by the Borrower (duly indorsed by the
Borrower to the Agent, if required) and held by the Agent in a Collateral
Account maintained under the sole dominion and control of the Agent. All
Proceeds while held by the Agent in a Collateral Account (or by the Borrower in
trust for the Agent and the Lenders) shall continue to be held as collateral
security for all the Obligations and shall not constitute payment thereof until
applied as provided in subsection 9.3.
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9.3 Application of Proceeds. At such intervals as may be agreed upon
by the Borrower and the Agent, or, if an Event of Default shall have occurred
and be continuing, at any time at the Agent's election, the Agent may apply all
or any part of Proceeds held in any Collateral Account in payment of the
Obligations in such order as the Agent may elect, and any part of such funds
which the Agent elects not so to apply and deems not required as collateral
security for the Obligations shall be paid over from time to time by the Agent
to the Borrower or to whomsoever may be lawfully entitled to receive the same.
Any balance of such Proceeds remaining after the Obligations shall have been
paid in full and the Commitments shall have expired or otherwise been
terminated shall be paid over to the Borrower or to whomsoever may be lawfully
entitled to receive the same.
9.4 Code Remedies. If an Event of Default shall occur and be
continuing, the Agent, on behalf of the Lenders may exercise, in addition to
all other rights and remedies granted to them in this Agreement and in any
other instrument or agreement securing, evidencing or relating to the
Obligations, all rights and remedies of a secured party under the Code.
Without limiting the generality of the foregoing, the Agent, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon the
Borrower or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase, or otherwise dispose of and deliver the Collateral or any part
thereof (or contract to do any of the foregoing), in one or more parcels at
public or private sale or sales, at any exchange, broker's board or office of
the Agent or any Lender or elsewhere upon such terms and conditions as it may
deem advisable and at such prices as it may deem best, for cash or on credit or
for future delivery without assumption of any credit risk. The Agent or any
Lender shall have the right upon any such public sale or sales, and, to the
extent permitted by law, upon any such private sale or sales, to purchase the
whole or any part of the Collateral so sold, free of any right or equity of
redemption in the Borrower, which right or equity is hereby waived or released.
The Borrower further agrees, at the Agent's request, to assemble the Collateral
and make it available to the Agent at places which the Agent shall reasonably
select, whether at the Borrower's premises or elsewhere. The Agent shall apply
the net proceeds of any action taken by it pursuant to this subsection, after
deducting all reasonable costs and expenses of every kind incurred in
connection therewith or incidental to the care or safekeeping of any of the
Collateral or in any way relating to the Collateral or the rights of the Agent
and the Lenders hereunder, including, without limitation, reasonable attorneys'
fees and disbursements, to the payment in whole or in part of the Obligations,
in such order as the Agent may elect, and only after such application and after
the payment by the Agent of any other amount required by any provision of law,
including, without limitation, Section 9-504(1)(c) of the Code, need the Agent
account for the surplus, if any, to the Borrower. To the extent permitted by
applicable law, the Borrower waives all claims, damages and demands it may
acquire against the Agent or any Lender arising out of the exercise by them of
any rights hereunder. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least 10 days before such sale or other disposition.
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10. Agent's Appointment as Attorney-in-Fact; Agent's Performance of
Borrower's Obligations.
10.1 Powers. The Borrower hereby irrevocably constitutes and
appoints the Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of the Borrower and in the name of
the Borrower or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, and, without limiting the generality of the
foregoing, the Borrower hereby gives the Agent the power and right, on behalf
of the Borrower, without notice to or assent by the Borrower, to do any or all
of the following:
(a) in the name of the Borrower or its own name, or
otherwise, take possession of and indorse and collect any checks,
drafts, notes, acceptances or other instruments for the payment of
moneys due under any Receivable or Contract or with respect to any
other Collateral and file any claim or take any other action or
proceeding in any court of law or equity or otherwise deemed
appropriate by the Agent for the purpose of collecting any and all
such moneys due under any Receivable or Contract or with respect to
any other Collateral whenever payable;
(b) in the case of any Patent or Trademark, execute and
deliver any and all agreements, instruments, documents and papers as
the Agent may request to evidence the Agent's and the Lenders'
security interest in such Patent or Trademark and the goodwill and
general intangibles of the Borrower relating thereto or represented
thereby;
(c) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance
called for by the terms of this Agreement and pay all or any part of
the premiums therefor and the costs thereof;
(d) execute, in connection with any sale provided for in
subsection 9.4, any indorsements, assignments or other instruments of
conveyance or transfer with respect to the Collateral; and
(e) (i) direct any party liable for any payment under any of
the Collateral to make payment of any and all moneys due or to become
due thereunder directly to the Agent or as the Agent shall direct;
(ii) ask or demand for, collect, receive payment of and receipt for,
any and all moneys, claims and other amounts due or to become due at
any time in respect of or arising out of any Collateral; (iii) sign
and indorse any invoices, freight or express bills, bills of lading,
storage or warehouse receipts, drafts against debtors, assignments,
verifications, notices and other documents in connection with any of
the Collateral; (iv) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction
to collect the Collateral or any thereof and to enforce any other
right in respect of any Collateral; (v) defend any suit, action or
proceeding brought against the Borrower with respect to
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any Collateral; (vi) settle, compromise or adjust any such suit,
action or proceeding and, in connection therewith, to give such
discharges or releases as the Agent may deem appropriate; (vii) assign
any Patent or Trademark (along with the goodwill of the business to
which any such Patent or Trademark pertains), throughout the world for
such term or terms, on such conditions, and in such manner, as the
Agent shall in its sole discretion determine; and (viii) generally,
sell, transfer, pledge and make any agreement with respect to or
otherwise deal with any of the Collateral as fully and completely as
though the Agent were the absolute owner thereof for all purposes, and
do, at the Agent's option and the Borrower's expense, at any time, or
from time to time, all acts and things which the Agent deems necessary
to protect, preserve or realize upon the Collateral and the Agent's
and the Lenders' security interests therein and to effect the intent
of this Agreement, all as fully and effectively as the Borrower might
do.
Anything in this subsection to the contrary notwithstanding, the Agent
agrees that it will not exercise any rights under the power of attorney
provided for in this subsection unless an Event of Default shall have occurred
and be continuing.
10.2 Performance by Agent of Borrower's Obligations. If the Borrower
fails to perform or comply with any of its agreements contained herein, the
Agent, at its option, but without any obligation so to do, may perform or
comply, or otherwise cause performance or compliance, with such agreement.
10.3 Borrower's Reimbursement Obligation. The expenses of the Agent
incurred in connection with actions undertaken as provided in this Section,
together with interest thereon at a rate per annum equal to the rate per annum
at which interest would then be payable on past due Base Rate Loans under the
Credit Agreement, from the date of payment by the Agent to the date reimbursed
by the Borrower, shall be payable by the Borrower to the Agent on demand.
10.4 Ratification; Power Coupled With An Interest. The Borrower
hereby ratifies all that said attorneys shall lawfully do or cause to be done
by virtue hereof. All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this Agreement
is terminated and the security interests created hereby are released.
11. Duty of Agent. The Agent's sole duty with respect to the
custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9-207 of the Code or otherwise, shall be to deal with
it in the same manner as the Agent deals with similar property for its own
account. Neither the Agent, any Lender nor any of their respective officers,
directors, employees or agents shall be liable for failure to demand, collect
or realize upon any of the Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Collateral upon the
request of the Borrower or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof. The powers
conferred on the Agent and the Lenders hereunder are solely to protect the
Agent's and the Lenders' interests in the Collateral and shall not impose any
duty upon
153
15
the Agent or any Lender to exercise any such powers. The Agent and the Lenders
shall be accountable only for amounts that they actually receive as a result of
the exercise of such powers, and neither they nor any of their officers,
directors, employees or agents shall be responsible to the Borrower for any act
or failure to act hereunder, except for their own gross negligence or willful
misconduct.
12. Execution of Financing Statements. Pursuant to Section 9-402 of
the Code, the Borrower authorizes the Agent to file financing statements with
respect to the Collateral without the signature of the Borrower in such form
and in such filing offices as the Agent reasonably determines appropriate to
perfect the security interests of the Agent under this Agreement. A carbon,
photographic or other reproduction of this Agreement shall be sufficient as a
financing statement for filing in any jurisdiction.
13. Authority of Agent. The Borrower acknowledges that the rights
and responsibilities of the Agent under this Agreement with respect to any
action taken by the Agent or the exercise or non-exercise by the Agent of any
option, voting right, request, judgment or other right or remedy provided for
herein or resulting or arising out of this Agreement shall, as between the
Agent and the Lenders, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Agent and the Borrower, the Agent shall be conclusively presumed
to be acting as agent for the Lenders with full and valid authority so to act
or refrain from acting, and the Borrower shall be under no obligation, or
entitlement, to make any inquiry respecting such authority.
14. Notices. All notices, requests and demands to or upon the Agent
or the Borrower hereunder shall be effected in the manner provided for in
subsection 9.2 of the Credit Agreement.
15. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
16. Amendments in Writing; No Waiver; Cumulative Remedies.
16.1 Amendments in Writing. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except by
a written instrument executed by the Borrower and the Agent, provided that any
provision of this Agreement imposing obligations on the Borrower may be waived
by the Agent in a written instrument executed by the Agent.
16.2 No Waiver by Course of Conduct. Neither the Agent nor any
Lender shall by any act (except by a written instrument pursuant to subsection
16.1), delay, indulgence, omission or otherwise be deemed to have waived any
right or remedy hereunder or to have acquiesced in any Default or Event of
Default. No failure to exercise, nor any delay in
154
16
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Agent or any Lender of any right or remedy
hereunder on any one occasion shall not be construed as a bar to any right or
remedy which the Agent or such Lender would otherwise have on any future
occasion.
16.3 Remedies Cumulative. The rights and remedies herein provided
are cumulative, may be exercised singly or concurrently and are not exclusive
of any other rights or remedies provided by law.
17. Section Headings. The Section and subsection headings used in
this Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation
hereof.
18. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Borrower and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
19. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
155
17
IN WITNESS WHEREOF, the undersigned has caused this Security Agreement
to be duly executed and delivered as of the date first above written.
TRAVEL CHANNEL ACQUISITION
CORPORATION
By:
-----------------------------
156
SCHEDULE I
TO BORROWER SECURITY AGREEMENT
CONTRACTS
None
157
SCHEDULE II
TO BORROWER SECURITY AGREEMENT
PATENTS AND PATENT LICENSES
None
158
SCHEDULE III
TO BORROWER SECURITY AGREEMENT
TRADEMARKS AND TRADEMARK LICENSES
See Attached.
159
Copyrights in all episodes of the following programs:
1. "Designs on Travel"
2. "Etc. . . . Etc"
3. "The World Through Celebrities Eyes"
4. "First Impressions"
5. "Great Getaway Game"
6. "Inside Travel"
7. "The Perfect Trip"
8. "Sense of Place"
9. "United States"
10. "▇▇▇▇▇▇ ▇▇▇▇▇▇▇'▇ Almanac of Travel"
11. "Countries of the World"
12. "On the Agenda"
160
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Monday, June 09, 1997 Client Status Report Page: 1
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ 74/082821 1681684 WSB Sec. 8 Deadline 31-Mar-1998
Registered 30-Jul-1990 31-Mar-1992 JSP Renewal Earliest Date ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. WXB Next Renewal 31-Mar-2002
Classes: 041 Grace Period Ends 30-Jun-2002
Goods: Entertainment services in the nature of a television program
series concerning travel
Remarks: Additional Attorney(s): THD THD
First Use In Commerce: 11/26/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Natn-1 Class(es): 107
Service ▇▇▇▇; Supplemental Register
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
DESIGNS ON TRAVEL T07621 74/082822 1692008 WSB Sec. 8 Deadline 09-Jun-1998
Registered 30-Jul-1990 09-Jun-1992 JSP Renewal Earliest Date 09-Dec-2001
United States of America Owner: The Travel Channel, Inc. LJL Next Renewal 09-Jun-2002
Classes: 041 Grace Period Ends 09-Sep-2002
Goods: Entertainment services in the nature of a televised program
series featuring travel information
Remarks: Disclaimer: "travel"
First Use In Commerce: 4/18/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
161
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Monday, June 09, 1997 Client Status Report Page: 2
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
ETC...ETC... T07624 74/084643 1651090 WSB Sec. 8 Deadline 16-Jul-1997
Registered 03-Aug-1990 16-Jul-1991 JSP Renewal Earliest Date 16-Jan-2001
United States of America Owner: The Travel Channel, Inc. WXB Next Renewal 16-Jul-2001
Classes: 41 Grace Period Ends 16-Oct-2001
Goods: Entertainment services in the nature of a televised program
series concerning travel
Remarks: Additional Attorney(s): THD THD
First Use In Commerce: 4/1/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
FIRST IMPRESSIONS T07627 74/209918 1741812 WSB Sec. 8/15 Earliest Dt. 22-Dec-1997
Registered 07-Oct-1991 22-Dec-1992 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. WXB Renewal Earliest Date 22-Jun-2002
Classes: 041 Next Renewal 22-Dec-2002
Goods: Entertainment services in the nature of a televised program Grace Period Ends 22-Mar-2003
series featuring travel information
Remarks: Additional Attorney(s): THD THD
First Use In Commerce: 10/1/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
162
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Monday, June 09, 1997 Client Status Report Page: 3
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
NAVIGATOR T07924 74/727084 1985853 WSB Sec. 8/15 Earliest Dt. 09-Jul-2001
Registered 11-Sep-1995 09-Jul-1996 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. THD Renewal Earliest Date 09-Jan-2006
Classes: 16 Next Renewal 09-Jul-2006
Goods: Monthly television program guide Grace Period Ends 09-Oct-2006
Remarks:
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
THE PERFECT TRIP T07625 74/832207 1669767 WSB Sec. 8 Deadline 24-Dec-1997
Registered 30-Jul-1990 09-Jun-1992 JSP Renewal Earliest Date 24-Jun-2001
United States of America Owner: The Travel Channel, Inc. THD Next Renewal 24-Dec-2001
Classes: 041 Grace Period Ends 24-Mar-2002
Goods: Entertainment services in the nature of travel, tourism and
adventure programs
Remarks: Additional Attorney(s): LJL LJL
First Use In Commerce: 3/19/87
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Natn-1 Class(es): 107
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
163
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Monday, June 09, 1997 Client Status Report Page: 4
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 74/688681 1982443 JSP Sec. 8/15 Earliest Dt. 25-Jun-2001
Registered 30-Jul-1990 31-Mar-1992 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. THD Renewal Earliest Date 25-Dec-2005
Classes: 038 & 041 Next Renewal 25-Jun-2006
Goods: Cable television broadcasting services (C1.38); producing Grace Period Ends 25-Sep-2006
television programs (C1.41)
Remarks: Disclaimer: "channel"
First Use In Commerce: 10/13/86
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
THE TRAVEL CHANNEL T07622 73/308959 1205086 WSB Renewal Earliest Date 10-Feb-2002
Registered 30-Jul-1990 09-Jun-1992 JSP Next Renewal 10-Aug-2002
United States of America Owner: The Travel Channel, Inc. WXB Grace Period Ends 10-Nov-2002
Classes: 038
Goods: Broadcasting services to cable television systems by the
way of satellite
Remarks: Disclaimer: "channel"
First Use In Commerce: 4/1/81
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇; Supplemental Register
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
164
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Monday, June 09, 1997 Client Status Report Page: 5
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
THE TRAVEL CHANNEL & DESIGN T07814 74/688684 1980990 JSP Sec. 8/15 Earliest Dt. 18-Jun-2001
Registered 14-Jun-1995 18-Jun-1996 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. THD Renewal Earliest Date 18-Dec-2005
Classes: 038 & 041 Next Renewal 18-Jun-2006
Grace Period Ends 18-Sep-2006
Goods: Cable television broadcasting services (C1.38); producing
television programs (C1.41)
Remarks: Disclaimer: "channel"
First Use In Commerce: 5/1/93
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
THE TRAVEL CHANNEL & DESIGN 081990 73/684289 1522924 WSB Renewal Earliest Date 31-Jul-2008
Registered 14-Sep-1987 31-Jan-1989 JSP Next Renewal 31-Jan-2009
United States of America Owner: The Travel Channel, Inc. WXB Grace Period Ends 30-Apr-2009
Classes: 38, 39, 41 & 42
Goods: Cable television/broadcasting (C1.38); travel agency
services (C1.39); producing tv programs...(C1.41); tv
shopping services (C1.42)
Remarks: Reel/Frame/Date: 1220/0311; 9/21/94
Assign/Owner Change: From Travel Marketing Corporation
165
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Monday, June 09, 1997 Client Status Report Page: 6
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
ULTIMATE WORLD TOUR T07995 74/578712 1918300 WSB Sec. 8/15 Earliest Dt. 12-Sep-2000
Registered 26-Sep-1994 12-Sep-1995 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. Renewal Earliest Date 12-Mar-2005
Classes: 35 Next Renewal Ends 12-Sep-2005
Grace Period Ends 12-Dec-2005
Goods: Promoting the sale of goods and services of others by
conducting an incentive program
Remarks: First Use In Commerce: 9/1/94
Natn-1 Class(es): 100, 101, 102
Client: T242 The Travel Channel
Registrant: The Travel Channel
166
SCHEDULE IV
TO BORROWER'S
SECURITY AGREEMENT
VEHICLES
Not Applicable.
167
SCHEDULE V
TO BORROWER'S SECURITY AGREEMENT
FILINGS AND OTHER ACTIONS
REQUIRED TO PERFECT SECURITY INTERESTS
Uniform Commercial Code Filings
a. File in the following:
Georgia - Secretary of State and DeKalb County
b. Precautionary Statement - Should file in the
following:
Virginia - Secretary of State and City of Norfolk
Florida - Secretary of State
Patent and Trademark Filings
See Attached.
Other Actions
168
SCHEDULE VI
TO BORROWER'S SECURITY AGREEMENT
INVENTORY AND EQUIPMENT
Inventory and Equipment located in the following places:
1. The Travel Channel, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
2. ▇▇▇▇▇▇▇▇ Communications, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
169
EXHIBIT D
TO THE
CREDIT AGREEMENT
FORM OF SUBSIDIARIES GUARANTEE
SUBSIDIARIES GUARANTEE, dated as of July __, 1997, made by each of the
corporations that are signatories hereto (the "Guarantors"), in favor of Union
Bank of California, N.A., as agent (in such capacity, the "Agent") for the
Lenders parties to the Credit Agreement, dated as of July 11, 1997 (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among Travel Channel Acquisition Corporation (the "Borrower"), the Lenders and
the Agent.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS, the Borrower owns directly or indirectly all of the issued
and outstanding stock of each Guarantor;
WHEREAS, the Borrower and the Guarantors are engaged in related
businesses, and each Guarantor will derive substantial direct and indirect
benefit from the making of the Loans;
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
the Guarantors shall have executed and delivered this Amended and Restated
Guarantee to the Agent for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce the
Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective loans to the Borrower under the Credit
Agreement, the Guarantors hereby agree with the Agent, for the ratable benefit
of the Lenders, as follows:
1. Defined Terms. (a) Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them
in the Credit Agreement.
(b) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Guarantee shall refer to this Guarantee as a whole and
not to any particular provision of this Guarantee, and section and paragraph
references are to this Guarantee unless otherwise specified.
(c) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
170
2
2. Guarantee (a) Subject to the provisions of paragraph 2(b),
each of the Guarantors hereby, jointly and severally, unconditionally and
irrevocably, guarantees to the Agent, for the ratable benefit of the Lenders
and their respective successors, indorsees, transferees and assigns, the prompt
and complete payment and performance by the Borrower when due (whether at the
stated maturity, by acceleration or otherwise) of the Obligations.
(b) Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under
the other Loan Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws relating
to the insolvency of debtors.
(c) Each Guarantor further agrees to pay any and all expenses
(including, without limitation, all fees and disbursements of counsel) which
may be paid or incurred by the Agent or any Lender in enforcing, or obtaining
advice of counsel in respect of, any rights with respect to, or collecting, any
or all of the Obligations and/or enforcing any rights with respect to, or
collecting against, such Guarantor under this Guarantee. This Guarantee shall
remain in full force and effect until the Obligations are paid in full and the
Commitments are terminated, notwithstanding that from time to time prior
thereto the Borrower may be free from any Obligations.
(d) Each Guarantor agrees that the Obligations may at any time and
from time to time exceed the amount of the liability of such Guarantor
hereunder without impairing this Guarantee or affecting the rights and remedies
of the Agent or any Lender hereunder.
(e) No payment or payments made by the Borrower, any of the
Guarantors, any other guarantor or any other Person or received or collected by
the Agent or any Lender from the Borrower, any of the Guarantors, any other
guarantor or any other Person by virtue of any action or proceeding or any
set-off or appropriation or application at any time or from time to time in
reduction of or in payment of the Obligations shall be deemed to modify,
reduce, release or otherwise affect the liability of any Guarantor hereunder
which shall, notwithstanding any such payment or payments other than payments
made by such Guarantor in respect of the Obligations or payments received or
collected from such Guarantor in respect of the Obligations, remain liable for
the Obligations up to the maximum liability of such Guarantor hereunder until
the Obligations are paid in full and the Commitments are terminated.
(f) Each Guarantor agrees that whenever, at any time, or from time to
time, it shall make any payment to the Agent or any Lender on account of its
liability hereunder, it will notify the Agent in writing that such payment is
made under this Guarantee for such purpose.
3. Right of Contribution. Each Guarantor hereby agrees that to the
extent that a Guarantor shall have paid more than its proportionate share of
any payment made hereunder, such Guarantor shall be entitled to seek and
receive contribution from and against any other Guarantor hereunder who has not
paid its proportionate share of such payment. Each Guarantor's right of
contribution shall be subject to the terms and conditions of Section 5 hereof.
The provisions of this Section shall in no respect limit the obligations and
liabilities
171
3
of any Guarantor to the Agent and the Lenders, and each Guarantor shall remain
liable to the Agent and the Lenders for the full amount guaranteed by such
Guarantor hereunder.
4. Right of Set-off. Upon the occurrence and during the continuance
of any Event of Default, each Guarantor hereby irrevocably authorizes each
Lender at any time and from time to time without notice to such Guarantor or
any other Guarantor, any such notice being expressly waived by each Guarantor,
to set-off and appropriate and apply any and all deposits (general or special,
time or demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender to or for the credit or the account of such Guarantor, or
any part thereof in such amounts as such Lender may elect, against and on
account of the obligations and liabilities of such Guarantor to such Lender
hereunder and claims of every nature and description of such Lender against
such Guarantor, in any currency, whether arising hereunder, under the Credit
Agreement, any Note, any Loan Documents or otherwise, as such Lender may elect,
whether or not the Agent or any Lender has made any demand for payment and
although such obligations, liabilities and claims may be contingent or
unmatured. The Agent and each Lender shall notify such Guarantor promptly of
any such set-off and the application made by the Agent or such Lender, provided
that the failure to give such notice shall not affect the validity of such
set-off and application. The rights of the Agent and each Lender under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which the Agent or such Lender may have.
5. No Subrogation. Notwithstanding any payment or payments made by
any of the Guarantors hereunder or any set-off or application of funds of any
of the Guarantors by any Lender, (a) no Guarantor shall be entitled to be
subrogated to any of the rights of the Agent or any Lender against the Borrower
or any other Guarantor or any collateral security or guarantee or right of
offset held by any Lender for the payment of the Obligations nor (b) shall any
Guarantor seek or be entitled to seek any contribution or reimbursement from
the Borrower or any other Guarantor in respect of payments made by such
Guarantor hereunder, in each case, until all amounts owing to the Agent and the
Lenders by the Borrower on account of the Obligations are paid in full and the
Commitments are terminated. If any amount shall be paid to any Guarantor on
account of such subrogation rights at any time when all of the Obligations
shall not have been paid in full, such amount shall be held by such Guarantor
in trust for the Agent and the Lenders, segregated from other funds of such
Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned over
to the Agent in the exact form received by such Guarantor (duly indorsed by
such Guarantor to the Agent, if required), to be applied against the
Obligations, whether matured or unmatured, in such order as the Agent may
determine.
6. Amendments, etc. with respect to the Obligations; Waiver of
Rights. Each Guarantor shall remain obligated hereunder notwithstanding that,
without any reservation of rights against any Guarantor and without notice to
or further assent by any Guarantor, any demand for payment of any of the
Obligations made by the Agent or any Lender may be rescinded by such party and
any of the Obligations continued, and the Obligations, or the liability of any
other party upon or for any part thereof, or any collateral security or
guarantee
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therefor or right of offset with respect thereto, may, from time to time, in
whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by the Agent or any Lender, and
the Credit Agreement, the Notes and the other Loan Documents and any other
documents executed and delivered in connection therewith may be amended,
modified, supplemented or terminated, in whole or in part, as the Agent (or the
Required Lenders, as the case may be) may deem advisable from time to time, and
any collateral security, guarantee or right of offset at any time held by the
Agent or any Lender for the payment of the Obligations may be sold, exchanged,
waived, surrendered or released. Neither the Agent nor any Lender shall have
any obligation to protect, secure, perfect or insure any Lien at any time held
by it as security for the Obligations or for this Guarantee or any property
subject thereto. When making any demand hereunder against any of the
Guarantors, the Agent or any Lender may, but shall be under no obligation to,
make a similar demand on the Borrower or any other Guarantor or guarantor, and
any failure by the Agent or any Lender to make any such demand or to collect
any payments from the Borrower or any such other Guarantor or guarantor or any
release of the Borrower or such other Guarantor or guarantor shall not relieve
any of the Guarantors in respect of which a demand or collection is not made or
any of the Guarantors not so released of their several obligations or
liabilities hereunder, and shall not impair or affect the rights and remedies,
express or implied, or as a matter of law, of the Agent or any Lender against
any of the Guarantors. For the purposes hereof "demand" shall include the
commencement and continuance of any legal proceedings.
7. Guarantee Absolute and Unconditional. Each Guarantor waives any
and all notice of the creation, renewal, extension or accrual of any of the
Obligations and notice of or proof of reliance by the Agent or any Lender upon
this Guarantee or acceptance of this Guarantee, the Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or
incurred, or renewed, extended, amended or waived, in reliance upon this
Guarantee; and all dealings between the Borrower and any of the Guarantors, on
the one hand, and the Agent and the Lenders, on the other hand, likewise shall
be conclusively presumed to have been had or consummated in reliance upon this
Guarantee. Each Guarantor waives diligence, presentment, protest, demand for
payment and notice of default or nonpayment to or upon the Borrower or any of
the Guarantors with respect to the Obligations. Each Guarantor understands and
agrees that this Guarantee shall be construed as a continuing, absolute and
unconditional guarantee of payment without regard to (a) the validity,
regularity or enforceability of the Credit Agreement, any Note or any other
Loan Document, any of the Obligations or any other collateral security therefor
or guarantee or right of offset with respect thereto at any time or from time
to time held by the Agent or any Lender (b) any defense, set-off or
counterclaim (other than a defense of payment or performance) which may at any
time be available to or be asserted by the Borrower against the Agent or any
Lender, or (c) any other circumstance whatsoever (with or without notice to or
knowledge of the Borrower or such Guarantor) which constitutes, or might be
construed to constitute, an equitable or legal discharge of the Borrower for
the Obligations, or of such Guarantor under this Guarantee, in bankruptcy or in
any other instance. When pursuing its rights and remedies hereunder against
any Guarantor, the Agent and any Lender may, but shall be under no obligation
to, pursue such rights and remedies as it may have against the Borrower or any
other Person or against any collateral security or guarantee for the
Obligations or any right of offset with respect thereto, and any failure by the
Agent or any Lender to pursue such other
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rights or remedies or to collect any payments from the Borrower or any such
other Person or to realize upon any such collateral security or guarantee or to
exercise any such right of offset, or any release of the Borrower or any such
other Person or any such collateral security, guarantee or right of offset,
shall not relieve such Guarantor of any liability hereunder, and shall not
impair or affect the rights and remedies, whether express, implied or available
as a matter of law, of the Agent and the Lenders against such Guarantor. This
Guarantee shall remain in full force and effect and be binding in accordance
with and to the extent of its terms upon each Guarantor and the successors and
assigns thereof, and shall inure to the benefit of the Agent and the Lenders,
and their respective successors, indorsees, transferees and assigns, until all
the Obligations and the obligations of each Guarantor under this Guarantee
shall have been satisfied by payment in full and the Commitments shall be
terminated, notwithstanding that from time to time during the term of the
Credit Agreement the Borrower may be free from any Obligations.
8. Reinstatement. This Guarantee shall continue to be effective, or
be reinstated, as the case may be, if at any time payment, or any part thereof,
of any of the Obligations is rescinded or must otherwise be restored or
returned by the Agent or any Lender upon the insolvency, bankruptcy,
dissolution, liquidation or reorganization of the Borrower or any Guarantor, or
upon or as a result of the appointment of a receiver, intervenor or conservator
of, or trustee or similar officer for, the Borrower or any Guarantor or any
substantial part of its property, or otherwise, all as though such payments had
not been made.
9. Payments. Each Guarantor hereby guarantees that payments
hereunder will be paid to the Agent without set- off or counterclaim in U.S.
Dollars at the office of the Agent located at Union Bank of California, N.A.,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ Attn: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇.
10. Representations and Warranties; Covenants. (a) Each Guarantor
hereby represents and warrants that the representations and warranties set
forth in Section 3 of the Credit Agreement as they relate to such Guarantor or
the Loan Documents to which such Guarantor is a party, each of which is hereby
incorporated herein by reference, are true and correct, and the Agent and each
Lender shall be entitled to rely on each of them as if they were fully set
forth herein, provided that each reference in each such representation and
warranty to the Borrower's knowledge shall, for the purposes of this paragraph
(a), be deemed to be a reference to such Guarantor's knowledge.
(b) Each Guarantor hereby covenants and agrees with the Agent
and each Lender that, from and after the Closing Date until the Obligations are
paid in full, no Loan remains outstanding and the Commitments are terminated,
such Guarantor shall take, or shall refrain from taking, as the case may be,
all actions that are necessary to be taken or not taken so that no violation of
any provision, covenant or agreement contained in Sections 5 or 6 of the Credit
Agreement, and so that no Default or Event of Default, is caused by any act or
failure to act of such Guarantor or any of its Subsidiaries.
11. Authority of Agent. Each Guarantor acknowledges that the rights
and responsibilities of the Agent under this Guarantee with respect to any
action taken by the
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Agent or the exercise or non-exercise by the Agent of any option, right,
request, judgment or other right or remedy provided for herein or resulting or
arising out of this Guarantee shall, as between the Agent and the Lenders, be
governed by the Credit Agreement and by such other agreements with respect
thereto as may exist from time to time among them, but, as between the Agent
and such Guarantor, the Agent shall be conclusively presumed to be acting as
agent for the Lenders with full and valid authority so to act or refrain from
acting, and no Guarantor shall be under any obligation, or entitlement, to make
any inquiry respecting such authority.
12. Notices. All notices, requests and demands to or upon the Agent,
any Lender or any Guarantor to be effective shall be in writing (or by telex,
fax or similar electronic transfer confirmed in writing) and shall be deemed to
have been duly given or made (1) when delivered by hand or (2) if given by
mail, when deposited in the mails by certified mail, return receipt requested,
or (3) if by telex, fax or similar electronic transfer, when sent and receipt
has been confirmed, addressed as follows:
(a) if to the Agent or any Lender, at its address or transmission
number for notices provided in subsection 9.2 of the Credit Agreement; and
(b) if to any Guarantor, at its address or transmission number for
notices set forth under its signature below.
The Agent, each Lender and each Guarantor may change its address and
transmission numbers for notices by notice in the manner provided in this
Section.
13. Counterparts. This Guarantee may be executed by one or more of
the Guarantors on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. A set of the counterparts of this Guarantee signed by all the
Guarantors shall be lodged with the Agent.
14. Severability. Any provision of this Guarantee which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
15. Integration. This Guarantee represents the agreement of each
Guarantor with respect to the subject matter hereof and there are no promises
or representations by the Agent or any Lender relative to the subject matter
hereof not reflected herein.
16. Amendments in Writing; No Waiver; Cumulative Remedies. (a)
None of the terms or provisions of this Guarantee may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
each Guarantor and the Agent, provided that any provision of this Guarantee may
be waived by the Agent and the Lenders in a letter or agreement executed by the
Agent or by telex or facsimile transmission from the Agent.
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(b) Neither the Agent nor any Lender shall by any act (except by a
written instrument pursuant to paragraph 16(a) hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default or in any breach of any
of the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Agent or any Lender of any right or remedy
hereunder on any one occasion shall not be construed as a bar to any right or
remedy which the Agent or such Lender would otherwise have on any future
occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
17. Section Headings. The section headings used in this Guarantee
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
18. Successors and Assigns. This Guarantee shall be binding upon the
successors and assigns of each Guarantor and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
19. GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
20. Submission To Jurisdiction. Each of the Guarantors hereby
irrevocable and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Guarantee and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgement in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the United
States of America for the Southern District of New York, and appellate courts
from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to pleas or
claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to such
Guarantor at its address set forth under its signature below or at such other
address of which the Agent shall have been notified pursuant to the terms of
Section 12 hereof;
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(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to ▇▇▇ in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding referred to
in this subsection any special, exemplary, punitive or consequential damages.
21. Acknowledgements. Each Guarantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution
and delivery of this Guarantee and the other Loan Documents;
(b) neither the Agent nor any Lender has any fiduciary
relationship with or duty to such Guarantor arising out of or in connection
with this Guarantee or any of the other Loan Documents, and the relationship
between the Agent and the Lenders, on one hand, and the Guarantors on the other
hand, in connection herewith or therewith is solely that of creditor and
debtor; and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Lenders or among the Guarantors and the Lenders.
22. WAIVERS OF JURY TRIAL. THE GUARANTORS AND THE AGENT AND THE
LENDERS BY THEIR ACCEPTANCE HEREOF HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE
TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS GUARANTEE OR
ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
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IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee
to be duly executed and delivered by its duly authorized officer as of the day
and year first above written.
[ ]
By:___________________________________
178
EXHIBIT E
TO THE
CREDIT AGREEMENT
FORM OF SUBSIDIARIES PLEDGE AGREEMENT
SUBSIDIARIES PLEDGE AGREEMENT, dated as of July __, 1997, made
by each of the corporations signatories hereto (each a "Pledgor" and
collectively the "Pledgors") in favor of Union Bank of California, N.A., as
Agent (in such capacity, the "Agent") for the Lenders parties to the Credit
Agreement, dated as of July 11, 1997 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among Travel Channel
Acquisition Corporation, a Delaware corporation (the "Borrower"), the Agent and
such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein; and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower that each Pledgor guarantee
payment and performance of the Borrower's obligations under the Credit
Agreement, the Notes and the other Loan Documents; and
WHEREAS, in satisfaction of such condition, each Pledgor has entered
into the Subsidiaries Guarantee of even date herewith for the benefit of the
Agent and the Lenders; and
WHEREAS, each Pledgor is the legal and beneficial owner of the shares
of Pledged Stock (as hereinafter defined) hereby pledged by such Pledgor;
WHEREAS, each Pledgor is the legal and beneficial owner of each of the
Pledged Notes (as hereinafter defined) hereby pledged by such Pledgor; and
WHEREAS, it is a further condition precedent to the obligation of the
Lenders to make their respective Loans to the Borrower under the Credit
Agreement that each Pledgor shall have executed and delivered this Pledge
Agreement to secure payment and performance of each Pledgor's obligations under
the Subsidiaries Guarantee.
NOW, THEREFORE, in consideration of the premises and to induce
the Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans to the Borrower, each Pledgor hereby
agrees with the Agent, for the ratable benefit of the Lenders, as follows:
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1. Defined Terms. (a) Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given
to them in the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": this Pledge Agreement, as the same may be amended,
modified or otherwise supplemented from time to time.
"Code": the Uniform Commercial Code from time to time in effect in
the State of New York.
"Collateral": the Pledged Stock, the Pledged Notes and all Proceeds.
"Collateral Account": any account established to hold money Proceeds,
maintained under the sole dominion and control of the Agent, subject to
withdrawal by the Agent for the account of the Lenders only as provided in
subsection 10(a).
"Issuers": the collective reference to the companies identified on
Schedule 1 attached hereto as the issuers of the Pledged Stock; individually,
each an "Issuer."
"Obligors": the collective reference to the companies identified on
Schedule 2 hereto, as such Schedule may be amended from time to time.
"Pledged Notes": the promissory note or notes of the Obligors
identified on Schedule 2, together with all substitutes, replacements or
refinancings thereto that may be issued or granted by any Obligor to any
Pledgor while this Agreement is in effect.
"Pledged Securities": collectively, the Pledged Notes and the Pledged
Stock.
"Pledged Stock": the shares of capital stock listed on Schedule 1
hereto, together with all stock certificates, options or rights of any nature
whatsoever that may be issued or granted by any Issuer to any Pledgor in
respect of the Pledged Stock while this Agreement is in effect.
"Proceeds": all "proceeds" as such term is defined in Section
9-306(1) of the Uniform Commercial Code in effect in the State of New York on
the date hereof and, in any event, shall include, without limitation, all
dividends or other income from the Pledged Stock, collections thereon or
distributions with respect thereto.
"Secured Obligations": the collective reference to (a) the
Obligations and (b) all obligations and liabilities of each Pledgor which may
arise under or in connection with this Agreement or any other Loan Document to
which any such Pledgor is a party, whether on account of reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the Agent or to
the Lenders that are required to be paid by any Pledgor pursuant to the terms
of this Agreement or any other Loan Document to which such Pledgor is a party).
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"Securities Act": the Securities Act of 1933, as amended.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section and paragraph
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Pledge; Grant of Security Interest. Each Pledgor hereby delivers
to the Agent, for the ratable benefit of the Lenders, all the Pledged Stock
listed with its name on Schedule 1 hereto, and all of the Pledged Notes listed
with it's name on Schedule 2 hereto, and hereby grants to Agent, for the
ratable benefit of the Lenders, a first security interest in the Collateral, as
collateral security for the prompt and complete payment and performance when
due (whether at the stated maturity, by acceleration or otherwise) of the
Secured Obligations.
3. Stock Powers. (a) Concurrently with the delivery to the Agent of
each certificate representing one or more shares of Pledged Stock to the Agent,
the relevant Pledgor shall deliver an undated stock power covering such
certificate, duly executed in blank by such Pledgor with, if the Agent so
requests, signature guaranteed.
(b) Each Pledgor shall deliver to the Agent an Acknowledgement and
Consent, substantially in the form of Exhibit A to this Agreement, duly
executed by the Pledgor of such Pledged Stock.
4. Indorsement; Acknowledgement and Consent. Concurrently with the
delivery of each Pledged Note to the Agent pursuant to Section 2 of this
Agreement such Pledged Note shall be indorsed by the appropriate Pledgor as
follows:
Pay to the order of Bearer
[NAME OF PLEDGOR]
By: _____________________
Title: ____________________;
5. Payments Under the Pledged Notes. Unless an Event of Default
shall have occurred and be continuing, each Pledgor shall be permitted to
receive all regularly scheduled payments of principal and interest under the
Pledged Notes, as such payments become due. If an Event of Default shall occur
and be continuing, and the Agent shall have given notice to such Pledgor of the
Agent's intent to exercise its rights pursuant to Section 9 or 10 below, all
payments of principal and interest under the Pledged Notes shall be paid to the
Agent, who shall hold the same as Collateral hereunder. If such Pledgor shall
receive any such payments, such Pledgor shall hold the same in trust for the
Agent and the Lenders, segregated from
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other funds of such Pledgor, and deliver the same forthwith to the Agent in the
exact form received, duly indorsed by such Pledgor to the Agent, if required.
6. Representations and Warranties. Each Pledgor represents and
warrants that:
(a) The shares of Pledged Stock of such Pledgor constitute all the
issued and outstanding shares of all classes of the capital stock of the
Issuers thereof.
(b) The Pledged Notes of such Pledgor listed on Schedule 2 hereto
constitute all of the issued and outstanding promissory notes payable to such
Pledgor other than Excluded Investments.
(c) All the shares of such Pledged Stock have been duly and validly
issued and are fully paid and nonassessable; and each of such Pledged Notes has
been duly and validly issued and such Pledged Notes and each document and
instrument that secures or guarantees payment of such Pledged Note is, to the
best knowledge of the Pledgor of each such Pledged Note, the legal, valid and
binding obligation of the maker thereof, enforceable in accordance with its
terms, except as affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered
in a proceeding in equity or at law) and an implied covenant of good faith and
fair dealing; and none of the Pledged Notes is subject to any right of
counterclaim or offset whatsoever.
(d) Such Pledgor is the record and beneficial owner of, and has
good and marketable title to the Pledged Securities, free of any and all Liens
or options in favor of, or claims of, any other Person, except the security
interest created by this Agreement.
(e) Upon delivery to the Agent of the stock certificates
evidencing the Pledged Stock and the Pledged Notes, the security interest
created by this Agreement will constitute a valid, perfected first priority
security interest in the Collateral granted by such Pledgor, enforceable in
accordance with its terms against all creditors of such Pledgor and any Persons
purporting to purchase any Collateral from such Pledgor, except as affected by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally,
general equitable principles (whether considered in a proceeding in equity or
at law) and an implied covenant of good faith and fair dealing.
(f) Such Pledgor has obtained from each Issuer and has delivered
to the Agent an Acknowledgement and Consent, substantially in the form attached
hereto as Annex A, executed by each such Issuer.
(g) No consent or authorization of, filing with or other act by or
in respect of any Person is required in connection with the execution,
delivery, performance, validity or enforceability of the Pledged Notes, and
such Pledgor has fully performed all its obligations under the Pledged Notes.
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(h) Each Pledgor has the corporate power and authority and the legal
right to execute and deliver, to perform its obligations under, and to grant
the security interest in the Collateral pursuant to, this Agreement and has
taken all necessary corporate action to authorize its execution, delivery and
performance of, and grant of the security interest in the Collateral pursuant
to, this Agreement.
(i) The execution, delivery and performance of this Agreement will
not violate any provision of any Requirement of Law or material Contractual
Obligation of any Pledgor.
(j) There exists, to the best knowledge of each Pledgor, no default
under any Pledged Note pledged by such Pledgor. The principal amount
outstanding under each Pledged Note as of the date hereof is as specified on
Schedule 1. Except as described in Schedule 1, there exists no security
interest or guarantee that secures or supports payment of the indebtedness
evidenced by any Pledged Note, and the descriptions of such security interests
and guarantees in Schedule 1 are complete and accurate in all material
respects.
7. Covenants. Each Pledgor covenants and agrees with the Agent and
the Lenders that, from and after the date of this Agreement until this
Agreement is terminated and the security interests created hereby are released:
(a) If such Pledgor shall, as a result of its ownership of the
Pledged Stock, become entitled to receive or shall receive any stock
certificate (including, without limitation, any certificate representing a
stock dividend or a distribution in connection with any reclassification,
increase or reduction of capital or any certificate issued in connection with
any reorganization), option or rights, whether in addition to, in substitution
of, as a conversion of, or in exchange for any shares of the Pledged Stock, or
otherwise in respect thereof, such Pledgor shall accept the same as the agent
of the Agent and the Lenders, hold the same in trust for the Agent and the
Lenders and deliver the same forthwith to the Agent in the exact form received,
duly indorsed by such Pledgor to the Agent, if required, together with an
undated stock power covering such certificate duly executed in blank by such
Pledgor and with, if the Agent so requests, signature guaranteed, to be held by
the Agent, subject to the terms hereof, as additional collateral security for
the Secured Obligations. Any sums paid upon or in respect of the Pledged Stock
upon the liquidation or dissolution of any Issuer shall be paid over to the
Agent to be held by it hereunder as additional collateral security for the
Secured Obligations, and in case any distribution of capital shall be made on
or in respect of the Pledged Stock or any property shall be distributed upon or
with respect to the Pledged Stock pursuant to the recapitalization or
reclassification of the capital of any Issuer or pursuant to the reorganization
thereof, the property so distributed shall be delivered to the Agent to be held
by it hereunder as additional collateral security for the Secured Obligations.
If any sums of money or property so paid or distributed in respect of the
Pledged Stock shall be received by such Pledgor, such Pledgor shall, until such
money or property is paid or delivered to the Agent, hold such money or
property in trust for the Lenders, segregated from other funds of such Pledgor,
as additional collateral security for the Secured Obligations.
(b) Without the prior written consent of the Agent (or except as
expressly permitted under the terms of the Credit Agreement), no Pledgor will
(i) vote to enable, or take any
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other action to permit, any Issuer to issue any stock or other equity
securities of any nature or to issue any other securities convertible into or
granting the right to purchase or exchange for any stock or other equity
securities of any nature of any Issuer, (ii) sell, assign, transfer, exchange,
or otherwise dispose of, or grant any option with respect to, the Collateral,
(iii) create, incur or permit to exist any Lien or option in favor of, or any
claim of any Person with respect to, any of the Collateral, or any interest
therein, except for the security interests created by this Agreement or (iv)
enter into any agreement or undertaking restricting the right or ability of the
Pledgor or the Agent to sell, assign or transfer any of the Collateral.
(c) Each Pledgor shall maintain the security interest created by this
Agreement as a first, perfected security interest and shall defend such
security interest against claims and demands of all Persons other than the
Agent whomsoever. At any time and from time to time, upon the written request
of the Agent, and at the sole expense of such Pledgor, such Pledgor will
promptly and duly execute and deliver such further instruments and documents
and take such further actions as the Agent may reasonably request for the
purposes of obtaining or preserving the full benefits of this Agreement and of
the rights and powers herein granted. If any amount payable under or in
connection with any of the Collateral shall be or become evidenced by any
promissory note, other instrument or chattel paper, such note, instrument or
chattel paper shall be immediately delivered to the Agent, duly endorsed in a
manner satisfactory to the Agent, to be held as Collateral pursuant to this
Agreement.
(d) Each Pledgor shall pay, and save the Agent and the Lenders
harmless from, any and all liabilities with respect to, or resulting from any
delay in paying, any and all stamp, excise, sales or other taxes which may be
payable or determined to be payable with respect to any of the Collateral or in
connection with any of the transactions contemplated by this Agreement.
(e) Each Pledgor will not take or omit to take any action, the taking
or the omission of which would result in an alteration or impairment of the
Collateral or the security of this Agreement, except as otherwise permitted by
the terms of the Credit Agreement.
(f) Each Pledgor will not enter into any agreement amending or
supplementing the Collateral, except as otherwise permitted by the terms of the
Credit Agreement.
(g) Each Pledgor will not waive or release any obligation of any
party to the Collateral, except as otherwise permitted by the terms of the
Credit Agreement.
(h) Unless directed otherwise by the Agent, each Pledgor will
exercise promptly and diligently each and every material right which it may
have under the Collateral (except the right to release or cancel).
(i) Each Pledgor will not take or omit to take any action or 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 Collateral.
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(j) Upon the occurrence and continuance of an Event of Default, each
Pledgor will give the Agent copies of all material notices (including notices
of default) given or received with respect to the Collateral, promptly after
giving or receiving such notices.
(k) Each Pledgor shall deliver to the Agent, in the exact form
received, to be held by the Agent, subject to the terms hereof, as additional
collateral security for the Secured Obligations of such Pledgor any additional
promissory notes made by any Obligor for the benefit of such Pledgor or other
securities, options or rights received by it in substitution or exchange for,
or as a conversion of, or in addition to, any of the Pledged Notes, except to
the extent that such constitutes an Excluded Investment, or otherwise in
respect thereof, together with an undated endorsement or power, as the case may
be, duly executed to the order of "Bearer" or in blank, as the case may be, by
such Pledgor and with, if the Agent reasonably requests, signature guaranteed.
8. Cash Dividends; Voting Rights. (a) Unless an Event of Default
shall have occurred and be continuing and the Agent shall have given notice to
a Pledgor of the Agent's intent to exercise its corresponding rights pursuant
to Section 9 below, such Pledgor shall be permitted to receive all cash
dividends paid in the normal course of business of the Issuers and consistent
with past practice, to the extent permitted in the Credit Agreement, in respect
of the Pledged Stock and to exercise all voting and corporate rights with
respect to the Pledged Stock; provided, however, that no vote shall be cast or
corporate right exercised or other action taken which, in the Agent's
reasonable judgment, would impair the Collateral or which would be inconsistent
with or result in any violation of any provision of the Credit Agreement, the
Notes, this Agreement or any other Loan Document.
(b) Unless an Event of Default shall have occurred and be
continuing and the Agent shall have given notice to a Pledgor of the Agent's
intent to exercise its corresponding rights pursuant to Section 9 hereof, such
Pledgor shall be permitted to receive and retain all scheduled interest and
principal payments on account of the Pledged Notes of such Pledgor.
9. Rights of the Lenders and the Agent. (a) All money Proceeds
received by the Agent hereunder shall be held by the Agent for the benefit of
the Lenders in a Collateral Account. All Proceeds while held by the Agent in a
Collateral Account (or by each Pledgor in trust for the Agent and the Lenders)
shall continue to be held as collateral security for all the Secured
Obligations and shall not constitute payment thereof until applied as provided
in subsection 10(a).
(b) If an Event of Default shall occur and be continuing and the
Agent shall give notice of its intent to exercise such rights to a Pledgor, (i)
the Agent shall have the right to receive any and all cash dividends paid in
respect of the Pledged Stock and make application thereof to the Secured
Obligations in such order as the Agent may determine, and (ii) all shares of
the Pledged Stock shall be registered in the name of the Agent or its nominee,
and the Agent or its nominee may thereafter exercise (A) all voting, corporate
and other rights pertaining to such shares of the Pledged Stock at any meeting
of shareholders of any Issuer or otherwise and (B) any and all rights of
conversion, exchange, subscription and any other rights, privileges or options
pertaining to such shares of the Pledged Stock as if it were the
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absolute owner thereof (including, without limitation, the right to exchange at
its discretion any and all of the Pledged Stock upon the merger, consolidation,
reorganization, recapitalization or other fundamental change in the corporate
structure of any Issuer, or upon the exercise by such Pledgor or the Agent of
any right, privilege or option pertaining to such shares of the Pledged Stock,
and in connection therewith, the right to deposit and deliver any and all of
the Pledged Stock with any committee, depositary, transfer agent, registrar or
other designated agency upon such terms and conditions as the Agent may
determine), all without liability except to account for property actually
received by it, but the Agent shall have no duty to such Pledgor to exercise
any such right, privilege or option and shall not be responsible for any
failure to do so or delay in so doing.
(c) Anything herein to the contrary notwithstanding, each Pledgor
shall remain liable under the Pledged Notes of such Pledgor to observe and
perform all the conditions and obligations to be observed and performed by it
thereunder all in accordance with the terms and provisions of such Pledged
Notes. Neither the Agent nor the Lenders shall have any obligation or
liability under any Pledged Note by reason of or arising out of this Agreement
or the receipt by the Agent or the Lenders of any payment relating to such
Pledged Note pursuant hereto (other than to account for monies actually
received by it), nor shall the Agent or any of the Lenders be obligated in any
manner to perform any of the obligations of any Pledgor under or pursuant to
any Pledged Note, to make any payment, to make any inquiry as to the nature or
the sufficiency of any payment received by it or as to the sufficiency of any
performance by any party under any Pledged Note, to present or file any claim,
to take any action to enforce any performance or to collect the payment of any
amounts which may have been assigned to it or to which it may be entitled at
any time or times.
10. Remedies. (a) If an Event of Default shall have occurred and be
continuing, at any time at the Agent's election, the Agent may apply all or any
part of Proceeds held in any Collateral Account in payment of the Secured
Obligations in such order as the Agent may elect.
(b) If an Event of Default shall occur and be continuing, the Agent,
on behalf of the Lenders, may exercise, in addition to all other rights and
remedies granted in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Secured Obligations, all rights and
remedies of a secured party under the Code. Without limiting the generality of
the foregoing, the Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon any Pledgor or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
assign, give option or options to purchase or otherwise dispose of and deliver
the Collateral or any part thereof (or contract to do any of the foregoing), in
one or more parcels at public or private sale or sales, in the over-the-counter
market, at any exchange, broker's board or office of the Agent or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery
without assumption of any credit risk. The Agent or any Lender shall have the
right upon any such public sale or sales, and, to the extent permitted by
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law, upon any such private sale or sales, to purchase the whole or any part of
the Collateral so sold, free of any right or equity of redemption in any
Pledgor, which right or equity is hereby waived or released. The Agent shall
apply any Proceeds from time to time held by it and the net proceeds of any
such collection, recovery, receipt, appropriation, realization or sale, after
deducting all reasonable costs and expenses of every kind incurred in respect
thereof or incidental to the care or safekeeping of any of the Collateral or in
any way relating to the Collateral or the rights of the Agent and the Lenders
hereunder, including, without limitation, reasonable attorneys' fees and
disbursements of counsel to the Agent, to the payment in whole or in part of
the Secured Obligations, in such order as the Agent may elect, and only after
such application and after the payment by the Agent of any other amount
required by any provision of law, including, without limitation, Section
9-504(1)(c) of the Code, need the Agent account for the surplus, if any, to the
Pledgor. To the extent permitted by applicable law, each Pledgor waives all
claims, damages and demands it may acquire against the Agent or any Lender
arising out of the exercise by them of any rights hereunder. If any notice of
a proposed sale or other disposition of Collateral shall be required by law,
such notice shall be deemed reasonable and proper if given at least 10 days
before such sale or other disposition.
(c) Each Pledgor waives and agrees not to assert any rights or
privileges which it may acquire solely under Section 9-112 of the Code. Such
Pledgor shall remain liable for any deficiency if the proceeds of any sale or
other disposition of Collateral are insufficient to pay the Secured Obligations
and the fees and disbursements of any attorneys employed by the Agent or any
Lender to collect such deficiency.
11. Registration Rights; Private Sales. (a) If the Agent shall
determine to exercise its right to sell any or all of the Pledged Stock
pursuant to subsection 10(b) hereof, and if in the opinion of the Agent it is
necessary or advisable to have the Pledged Stock, or that portion thereof to be
sold, registered under the provisions of the Securities Act, such Pledgor will
cause the Issuer thereof to (i) execute and deliver, and cause the directors
and officers of such Issuer to execute and deliver, all such instruments and
documents, and do or cause to be done all such other acts as may be, in the
opinion of the Agent, necessary or advisable to register the Pledged Stock, or
that portion thereof to be sold, under the provisions of the Securities Act,
(ii) to use its best efforts to cause the registration statement relating
thereto to become effective and to remain effective for a period of one year
from the date of the first public offering of the Pledged Stock, or that
portion thereof to be sold, and (iii) to make all amendments thereto and/or to
the related prospectus which, in the opinion of the Agent, are necessary or
advisable, all in conformity with the requirements of the Securities Act and
the rules and regulations of the Securities and Exchange Commission applicable
thereto. Such Pledgor agrees to cause the such Issuer to comply with the
provisions of the securities or "Blue Sky" laws of any and all jurisdictions
which the Agent shall designate and to make available to its security holders,
as soon as practicable, an earnings statement (which need not be audited) which
will satisfy the provisions of Section 11(a) of the Securities Act.
(b) Each Pledgor recognizes that the Agent may be unable to effect a
public sale of any or all the Pledged Stock, by reason of certain prohibitions
contained in the Securities Act and applicable state securities laws or
otherwise, and may be compelled to resort to one or
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more private sales thereof to a restricted group of purchasers which will be
obliged to agree, among other things, to acquire such securities for their own
account for investment and not with a view to the distribution or resale
thereof. Such Pledgor acknowledges and agrees that any such private sale may
result in prices and other terms less favorable than if such sale were a public
sale and, notwithstanding such circumstances, agrees that any such private sale
shall be deemed to have been made in a commercially reasonable manner. The
Agent shall be under no obligation to delay a sale of any of the Pledged Stock
for the period of time necessary to permit the Issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such Issuer would agree to do so.
(c) Each Pledgor further agrees to use its best efforts to do or
cause to be done all such other acts as may be necessary to make such sale or
sales of all or any portion of the Pledged Stock pursuant to this Section valid
and binding and in compliance with any and all other applicable Requirements of
Law. Such Pledgor further agrees that a breach of any of the covenants
contained in this Section will cause irreparable injury to the Agent and the
Lenders, that the Agent and the Lenders have no adequate remedy at law in
respect of such breach and, as a consequence, that each and every covenant
contained in this Section 9 shall be specifically enforceable against such
Pledgor, and such Pledgor hereby waives and agrees not to assert any defenses
against an action for specific performance of such covenants except for a
defense that no Event of Default has occurred under the Credit Agreement.
12. Irrevocable Authorization and Instruction to Issuer. Each
Pledgor hereby authorizes and instructs each Issuer to comply with any
instruction received by it from the Agent in writing that (a) states that an
Event of Default has occurred and (b) is otherwise in accordance with the terms
of this Agreement, without any other or further instructions from such Pledgor,
and such Pledgor agrees that each Issuer shall be fully protected in so
complying.
13. Agent's Appointment as Attorney-in-Fact. (a) Each Pledgor
hereby irrevocably constitutes and appoints the Agent and any officer or agent
of the Agent, with full power of substitution, as its true and lawful
attorney-in- fact with full irrevocable power and authority in the place and
stead of such Pledgor and in the name of such Pledgor or in the Agent's own
name, from time to time in the Agent's discretion, for the purpose of carrying
out the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, including, without
limitation, any financing statements, endorsements, assignments or other
instruments of transfer.
(b) Each Pledgor hereby ratifies all that said attorneys shall
lawfully do or cause to be done pursuant to the power of attorney granted in
subsection 13(a). All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this Agreement
is terminated and the security interests created hereby are released.
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14. Duty of Agent. The Agent's sole duty with respect to the
custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9-207 of the Code or otherwise, shall be to deal with
it in the same manner as the Agent deals with similar securities and property
for its own account, except that the Agent shall have no obligation to invest
funds held in any Collateral Account and may hold the same as demand deposits.
Neither the Agent, any Lender nor any of their respective directors, officers,
employees or agents shall be liable for failure to demand, collect or realize
upon any of the Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral upon the request of
the Pledgor or any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof.
15. Execution of Financing Statements. Pursuant to Section 9-402 of
the Code, each Pledgor authorizes the Agent to file financing statements with
respect to the Collateral without the signature of such Pledgor in such form
and in such filing offices as the Agent reasonably determines appropriate to
perfect the security interests of the Agent under this Agreement. A carbon,
photographic or other reproduction of this Agreement shall be sufficient as a
financing statement for filing in any jurisdiction.
16. Authority of Agent. Each Pledgor acknowledges that the rights
and responsibilities of the Agent under this Agreement with respect to any
action taken by the Agent or the exercise or non-exercise by the Agent of any
option, voting right, request, judgment or other right or remedy provided for
herein or resulting or arising out of this Agreement shall, as between the
Agent and the Lenders, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Agent and the Pledgor, the Agent shall be conclusively presumed
to be acting as agent for the Lenders with full and valid authority so to act
or refrain from acting, and neither the Pledgor nor any Issuer shall be under
any obligation, or entitlement, to make any inquiry respecting such authority.
17. Notices. All notices, requests and demands to or upon the Agent
or any Pledgor to be effective shall be in writing (or by telex, fax or similar
electronic transfer confirmed in writing) and shall be deemed to have been duly
given or made (a) when delivered by hand or (b) if given by mail, when
deposited in the mails by certified mail, return receipt requested, or (c) if
by telex, fax or similar electronic transfer, when sent and receipt has been
confirmed, addressed as follows:
(i) if to the Agent, at its address or transmission number for
notices provided in subsection 9.2 of the Credit Agreement; and
(ii) if to a Pledgor, at its address or transmission number for
notices set forth under its signature below.
The Agent and each Pledgor may change their addresses and transmission numbers
for notices by notice in the manner provided in this Section.
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18. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
19. Return of Documents; Cooperation. (a) When this Agreement is
terminated and the security interests created hereby are released, the Agent
shall (i) return to each relevant Pledgor the Pledged Notes, (ii) execute and
deliver to such Pledgor such documents of assignment as are reasonably
necessary to terminate the Agent's security interest in the Collateral and to
advise the makers of the Pledged Notes of the termination of the Agent's rights
and security interest hereunder and (iii) return to such Pledgor the documents
delivered to the Agent as provided in Section 3. If any part of the Collateral
is released in connection with any disposition thereof expressly permitted
under the terms of the Credit Agreement, and the corresponding security
interests created hereby are released, the Agent shall take the actions under
clauses (i), (ii) and (iii) as appropriate, with respect to such release.
(b) Upon payment in full of any Pledged Note and payment of the
Proceeds thereof as provided in this Agreement, the Agent shall (i) return to
the relevant Pledgor such Pledged Note, indorsed to such Pledgor without
recourse, representation or warranty and (ii) execute and deliver to such
Pledgor such documents of assignment as are reasonably necessary to terminate
the Agent's security interest in any Collateral related to such Pledged Note.
(c) Upon the occurrence of a default or event of default under any
Pledged Note, the Agent shall cooperate reasonably with each relevant Pledgor,
at the expense of such Pledgor, in the exercise of such Pledgor's rights and
remedies under such Pledged Note and any document or instrument securing or
supporting the same.
20. Amendments in Writing; No Waiver; Cumulative Remedies. (a)
None of the terms or provisions of this Agreement may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
such Pledgor and the Agent, provided that any provision of this Agreement may
be waived by the Agent and the Lenders in a letter or agreement executed by the
Agent or by telex or facsimile transmission from the Agent.
(b) Neither the Agent nor any Lender shall by any act (except by a
written instrument pursuant to subsection 20(a) hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default or in any breach of any
of the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Agent or any Lender of any right or remedy
hereunder on any one occasion shall not be construed as a bar to any right or
remedy which the Agent or such Lender would otherwise have on any future
occasion.
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(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
21. Section Headings. The section headings used in this Agreement
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
22. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Pledgor and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
23. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
duly executed and delivered as of the date first above written.
[ ]
By:___________________________________
Address for Notices:
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▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
192
ACKNOWLEDGEMENT AND CONSENT
The undersigned is an Issuer referred to in the foregoing Subsidiaries
Pledge Agreement, and each of the undersigned hereby acknowledges receipt of a
copy of the Subsidiaries Pledge Agreement dated July __, 1997, made by the
Pledgors (as defined therein) for the benefit of Union Bank of California,
N.A., as Agent (as amended, supplemented or otherwise modified from time to
time, the "Pledge Agreement"). The undersigned agrees for the benefit of the
Agent and the Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement
and will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Agent promptly in writing of the
occurrence of any of the events described in subsection 7(a) of the Pledge
Agreement.
3. The terms of subsection 11(c) of the Pledge Agreement shall apply
to it, mutatis mutandis, with respect to all actions that may be required of it
under or pursuant to or arising out of Section 11 of the Pledge Agreement.
[ ]
By: ___________________________
Address for Notices:
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▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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193
SCHEDULE 1
TO SUBSIDIARIES
PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Issuer Class of Stock* Certificate No. No. of Shares
---------- -------------------- ------------------ ----------------
-----------------
* Stock is assumed to be common stock unless otherwise indicated.
194
SCHEDULE 2
TO SUBSIDIARIES
PLEDGE AGREEMENT
THE PLEDGED NOTES
Description of Pledged Principal Amount/Interest
Note[s] Collateral Security Guarantee[s] Payment
------------------------ --------------------------------- ---------------------------- -------------------------
[Promissory Note] dated Describe security agreements, Describe each guarantee. If Outstanding principal amount
__________, 19__, made mortgages, etc. Include recording none, state "None." $_____________________ipal
by _______________ to and filing information. If none,
the order of [the Pledgor] state "None." Last date to which interest
in the original principal was paid:_____________
amount of $_________ 199__
195
EXHIBIT F
TO THE
CREDIT AGREEMENT
FORM OF SUBSIDIARIES SECURITY AGREEMENT
SUBSIDIARIES SECURITY AGREEMENT, dated as of July __, 1997, made by
each of the corporations that are signatories hereto (each a "Pledgor" and
collectively the "Pledgors"), in favor of Union Bank of California, N.A., as
Agent (in such capacity, the "Agent") for the Lenders parties to the Credit
Agreement, dated as of July 11, 1997 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among Travel Channel
Acquisition Corporation, a Delaware corporation (the "Borrower"), the Agent and
such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
each Pledgor guarantees payment and performance of the Borrower's obligations
under the Credit Agreement and other Loan Documents;
WHEREAS, in satisfaction of such condition, each Pledgor has entered
into a Subsidiaries Guarantee of even date herewith for the benefit of the
Agent and the Lenders; and
WHEREAS, it is a further condition precedent to the obligation of the
Lenders to make their respective Loans to the Borrower under the Credit
Agreement that each Pledgor shall have executed and delivered this Security
Agreement to secure payment and performance of such Pledgor's obligations under
the Subsidiaries Guarantee.
NOW, THEREFORE, in consideration of the premises and to induce the
Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans to the Borrower, each Pledgor hereby
agrees with the Agent, for the ratable benefit of the Lenders, as follows:
1. Defined Terms.
1.1 Definitions. (a) Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them
in the Credit Agreement, and the following terms which are defined in the
Uniform Commercial Code in effect in the State of New York on the date hereof
are used herein as so defined: Accounts, Chattel Paper,
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Documents, Equipment, Farm Products, General Intangibles, Instruments,
Inventory and Proceeds.
(b) The following terms shall have the following meanings:
"Agreement": this Amended and Restated Security Agreement, as
the same may be amended, supplemented or otherwise modified from time
to time.
"Code": the Uniform Commercial Code as from time to time in
effect in the State of New York.
"Collateral": as defined in Section 2.
"Collateral Account": any collateral account established by
the Agent as provided in subsection 5.3 or subsection 9.2.
"Contracts": with respect to any Pledgor, all contracts,
agreements, instruments and indentures in any form, and portions
thereof, to which such Pledgor is a party or under which such Pledgor
has any right, title or interest or to which such Pledgor or any
property of such Pledgor is subject, as the same may from time to time
be amended, supplemented or otherwise modified, including, without
limitation, (a) all rights of such Pledgor to receive moneys due and
to become due to it thereunder or in connection therewith, (b) all
rights of such Pledgor to damages arising out of, or for, breach or
default in respect thereof and (c) all rights of such Pledgor to
perform and to exercise all remedies thereunder, except, in each case
to the extent the grant by such Pledgor of a security interest
pursuant to this Agreement in its right, title and interest in such
contract, agreement, instrument or indenture (i) is prohibited by such
contract, agreement, instrument or indenture without the consent of
any other party thereto, (ii) would give any other party to such
contract, agreement, instrument or indenture the right to terminate
its obligations thereunder, or (iii) is permitted with consent if all
necessary consents to such grant of a security interest have not been
obtained from the other parties thereto (it being understood that the
foregoing shall not be deemed to obligate such Pledgor to obtain such
consents) (the contracts, agreements, instruments or indentures
referred to in clauses (i), (ii) and (iii) which, if terminated could
reasonably be expected to have a Material Adverse Effect, are
specified on Schedule 1 attached hereto); provided, that the foregoing
limitation shall not affect, limit, restrict or impair the grant by
such Pledgor of a security interest pursuant to this Agreement in any
Account or any money or other amounts due or to become due under any
such contract, agreement, instrument or indenture.
"Patents": (a) all letters patent of the United States or any
other country and all reissues and extensions thereof, including,
without limitation, any thereof referred to in Schedule 2, and (b) all
applications for letters patent of the United States or any other
country and all divisions, continuations and continuations-in-part
thereof, including, without limitation, any thereof referred to in
Schedule 2.
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"Patent License": all agreements, whether written or oral,
providing for the grant by or to the Pledgor of any right to
manufacture, use or sell any invention covered by a Patent, including,
without limitation, any thereof referred to in Schedule 2.
"Receivable": any right to payment for goods sold or leased
or for services rendered, whether or not such right is evidenced by an
Instrument or Chattel Paper and whether or not it has been earned by
performance (including, without limitation, any Account).
"Secured Obligations": the collective reference to (a) the
Obligations and (b) all obligations and liabilities of any Pledgor
which may arise under or in connection with this Agreement or any
other Loan Document to which each Pledgor is a party, whether on
account of reimbursement obligations, fees, indemnities, costs,
expenses or otherwise (including, without limitation, all fees and
disbursements of counsel to the Agent or to the Lenders that are
required to be paid by any Pledgor pursuant to the terms of this
Agreement or any other Loan Document to which such Pledgor is a
party).
"Trademarks": (a) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade
styles, service marks, logos and other source or business identifiers,
and the goodwill associated therewith, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
applications in connection therewith, whether in the United States
Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof or any other country or any political
subdivision thereof, or otherwise, including, without limitation, any
thereof referred to in Schedule 3, and (b) all renewals thereof.
"Trademark License" means any agreement, written or oral,
providing for the grant by or to the Pledgor of any right to use any
Trademark, including, without limitation, any thereof referred to in
Schedule 3.
"Vehicles" means all cars, trucks, trailers, construction and
earth moving equipment and other vehicles covered by a certificate of
title law of any state.
1.2 Other Definitional Provisions. (a) The words "hereof,"
"herein", "hereto" and "hereunder" and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement, and Section, subsection and Schedule
references are to this Agreement unless otherwise specified.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
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2. Grant of Security Interest. As collateral security for the
prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of the Secured Obligations, each
Pledgor hereby grants to the Agent for the ratable benefit of the Lenders a
security interest in all of the following property now owned or at any time
hereafter acquired by such Pledgor or in which such Pledgor now has or at any
time in the future may acquire any right, title or interest (collectively,
the "Collateral"):
(a) all Accounts;
(b) all Chattel Paper;
(c) all Contracts;
(d) all Documents;
(e) all Equipment;
(f) all General Intangibles;
(g) all Instruments, other than Excluded Investments;
(h) all Inventory;
(i) all Patents;
(j) all Patent Licenses;
(k) all Trademarks;
(l) all Trademark Licenses;
(m) all Vehicles;
(n) all books, records, ledgercards, files, correspondence,
competitor programs, tapes, desks, and related data processing software (owned
by any Pledgor or in which any Pledgor has an interest) that at any time
evidence or certain information pertaining to the Collateral or are otherwise
necessary or helpful in the Collection thereof or realization thereupon; and
(o) to the extent not otherwise included, all Proceeds and products
of any and all of the foregoing and all collateral security and guarantees
given by any Person with respect to any of the foregoing.
3. Representations and Warranties. Each Pledgor hereby represents
and warrants that:
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3.1 Power and Authority. Such Pledgor has the corporate power and
authority and the legal right to execute and deliver, to perform its
obligations under, and to grant the security interest in the Collateral
pursuant to, this Agreement and has taken all necessary corporate action to
authorize its execution, delivery and performance of, and grant of the security
interest in the Collateral pursuant to, this Agreement.
3.2 Title; No Other Liens. Except for the security interest granted
to the Agent for the ratable benefit of the Lenders pursuant to this Agreement
and the other liens permitted to exist on the Collateral pursuant to the Credit
Agreement, such Pledgor owns each item of the Collateral free and clear of any
and all Liens or claims of others. No financing statement or other public
notice with respect to all or any part of the Collateral is on file or of
record in any public office, except such as have been filed in favor of the
Agent, for the ratable benefit of the Lenders, pursuant to this Agreement or as
permitted pursuant to the Credit Agreement.
3.3 Perfected, First Priority Security Interests. The security
interests granted pursuant to this Agreement (a) upon completion of the filings
and other actions specified on Schedule 5 will constitute perfected security
interests on the Collateral (other than Vehicles) in favor of the Agent, for
the ratable benefit of the Lenders, as collateral security for the Secured
Obligations and (b) are prior to all other Liens on the Collateral in existence
on the date hereof.
3.4 No Violation. The execution, delivery and performance of this
Agreement will not violate any provision of any Requirement of Law or material
Contractual Obligation of such Pledgor.
3.5 Inventory and Equipment. The Inventory and the Equipment are
kept at the locations listed on Schedule 6.
3.6 Chief Executive Office. The chief executive office and chief
place of business of each of the Pledgors is located at the addresses set forth
on the signature page to this Agreement.
3.7 Farm Products. None of the Collateral constitutes, or is the
Proceeds of, Farm Products.
4. Covenants. Each Pledgor covenants and agrees with the Agent and
the Lenders that, from and after the date of this Agreement until
the Secured Obligations shall have been paid in full and the
Commitments shall have expired or otherwise been terminated:
4.1 Maintenance of Property. Such Pledgor will keep all material
Equipment and Inventory used or useful in the business of such Pledgor in good
working order and condition.
4.2 Inspection of Property; Books and Records; Discussions. Such
Pledgor will keep proper books of records and account in which full, true and
correct entries in conformity with GAAP and all Requirements of Law shall be
made of all dealings and transactions in relation to the Collateral. Subject
to Section 9.15 of the Credit Agreement, such Pledgor will permit
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representatives of any Lender to visit and to inspect the Collateral and to
examine and make abstracts from any of its books and records and to discuss the
condition and operation of the Collateral with officers and employees of each
Pledgor and with its independent certified public accountants all upon
reasonable notice and at such reasonable times during normal business hours and
as often as may be reasonably requested.
4.3 Maintenance of Insurance. The Pledgors will maintain insurance
on the Collateral as required under the Credit Agreement.
4.4 Payment of Obligations. Such Pledgor will pay and discharge or
otherwise satisfy before any penalty accrues thereon, all taxes, assessments
and governmental charges or levies imposed upon the Collateral or in respect of
its income or profits therefrom, nonpayment of which would cause a Material
Adverse Effect, as well as all claims of any kind (including, without
limitation, claims for labor, materials and supplies) against or with respect
to the Collateral, except that no such charge need be paid if the amount or
validity thereof is currently being contested in good faith by appropriate
proceedings, reserves in conformity with GAAP with respect thereto have been
provided on the books of such Pledgor and such proceedings do not involve any
material danger of the sale, forfeiture or loss of any of the Collateral or any
interest therein.
4.5 Maintenance of Perfected Security Interest; Further
Documentation. (a) Such Pledgor will maintain the security interest created
by this Agreement as a perfected security interest having the priority
described in subsection 3.3 and will defend such security interest against
claims and demands of all Persons whomsoever.
(b) At any time and from time to time, upon the written
request of the Agent, and at the sole expense of such Pledgor, such Pledgor
will promptly and duly execute and deliver such further instruments and
documents and take such further actions as the Agent may reasonably request for
the purpose of obtaining or preserving the full benefits of this Agreement and
of any financing or continuation statements under the Uniform Commercial Code
in effect in any jurisdiction with respect to the security interests created
hereby.
4.6 Delivery of Instruments and Chattel Paper. If any amount payable
under or in connection with any of the Collateral shall be or become evidenced
by any Instrument or Chattel Paper, such Instrument or Chattel Paper shall be
immediately delivered to the Agent, duly indorsed in a manner satisfactory to
the Agent, to be held as Collateral pursuant to this Agreement.
4.7 Changes in Locations, Name, etc. Such Pledgor will not:
(a) permit any of the Inventory or Equipment to be kept at a location
other than those listed on Schedule 6; or
(b) change the location of its chief executive office from that
specified in subsection 3.6, unless it shall have given the Agent and the
Lenders at least 30 days' prior written notice of such change;
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(c) change its name, identity or corporate structure to such an extent
that any financing statement filed by the Agent in connection with this
Agreement would become seriously misleading unless it shall have given the
Agent and the Lenders at least 30 days prior written notice of such change.
4.8 Further Identification of Collateral. Such Pledgor will furnish
to the Agent and the Lenders from time to time statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as the Agent may reasonably request, all in reasonable
detail.
4.9 Notices. Such Pledgor will advise the Agent and the Lenders
promptly, in reasonable detail, at their respective addresses for notices
provided for in the Credit Agreement, of:
(a) any Lien (other than security interests created hereby or as
permitted pursuant to subsection 6.3 of the Credit Agreement) on any of the
Collateral; and
(b) of the occurrence of any other event which could reasonably be
expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.
4.10 Indemnification. Such Pledgor agrees to pay, and to save the
Agent and the Lenders harmless from, any and all liabilities, costs and
expenses to the same extent as the Borrower's obligations under subsection 9.5
of the Credit Agreement.
5. Provisions Relating to Receivables.
5.1 Each Pledgor Remains Liable under Receivables. Anything herein
to the contrary notwithstanding, each Pledgor shall remain liable under each of
the Receivables to observe and perform all the conditions and obligations to be
observed and performed by it thereunder, all in accordance with the terms of
any agreement giving rise to each such Receivable. Neither the Agent nor any
Lender shall have any obligation or liability under any Receivable (or any
agreement giving rise thereto) by reason of or arising out of this Agreement or
the receipt by the Agent or any Lender of any payment relating to such
Receivable pursuant hereto, nor shall the Agent or any Lender be obligated in
any manner to perform any of the obligations of such Pledgor under or pursuant
to any Receivable (or any agreement giving rise thereto), to make any payment,
to make any inquiry as to the nature or the sufficiency of any payment received
by it or as to the sufficiency of any performance by any party under any
Receivable (or any agreement giving rise thereto), to present or file any
claim, to take any action to enforce any performance or to collect the payment
of any amounts which may have been assigned to it or to which it may be
entitled at any time or times.
5.2 Analysis of Receivables. Upon the occurrence and continuance of
an Event of Default: (a) The Agent shall have the right to make test
verifications of the Receivables in any manner and through any medium that it
reasonably considers advisable, and each Pledgor shall furnish all such
assistance and information as the Agent may require in connection with
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such test verifications; (b) upon the Agent's request and at the expense of
such Pledgor, such Pledgor shall cause independent public accountants or others
satisfactory to the Agent to furnish to the Agent reports showing
reconciliations, aging and test verifications of, and trial balances for, the
Receivables; and (c) the Agent in its own name or in the name of others may
communicate with the obligors on the Receivables to verify with them to the
Agent's satisfaction the existence, amount and terms of any Receivables.
5.3 Collections on Receivables. (a) The Agent hereby authorizes each
Pledgor to collect such Receivables, subject to the Agent's direction and
control, and the Agent may curtail or terminate said authority at any time
after the occurrence and during the continuance of an Event of Default. If
required by the Agent at any time after the occurrence and during the
continuance of an Event of Default, any payments of Receivables, when collected
by such Pledgor, (i) shall be forthwith (and, in any event, within two Business
Days) deposited by such Pledgor in the exact form received, duly indorsed by
such Pledgor to the Agent if required, in a Collateral Account maintained under
the sole dominion and control of the Agent, subject to withdrawal by the Agent
for the account of the Lenders only as provided in subsection 9.3, and (ii)
until so turned over, shall be held by such Pledgor in trust for the Agent and
the Lenders, segregated from other funds of such Pledgor.
(b) Each such deposit of Proceeds of Receivables shall be accompanied
by a report identifying in reasonable detail the nature and source of the
payments included in the deposit.
(c) Upon the occurrence and during the continuance of an Event of
Default, at the Agent's request, each Pledgor shall deliver to the Agent all
original and other documents evidencing, and relating to, the agreements and
transactions which gave rise to the Receivables, including, without limitation,
all original orders, invoices and shipping receipts.
5.4 Representations and Warranties. (a) No amount payable to any
Pledgor under or in connection with any Receivable is evidenced by any
Instrument or Chattel Paper which has not been delivered to the Agent.
(b) None of the obligors on any Receivable is a Governmental
Authority.
(c) The amounts represented by each Pledgor to each Lenders from time
to time (upon the Agent's request) as owing to such Pledgor in respect of the
Receivables will at such time be accurate in all material respects.
5.5 Covenants. (a) Other than in the ordinary course of business
consistent with its past practice, each Pledgor will not (i) grant any
extension of the time of payment of any Receivable, (ii) compromise or settle
any Receivable for less than the full amount thereof, (iii) release, wholly or
partially, any Person liable for the payment of any Receivable, (iv) allow any
credit or discount whatsoever on any Receivable, (v) amend, supplement or
modify any Receivable in any manner that could adversely affect the value
thereof or (vi) fail to exercise promptly and diligently each and every
material right which it may have under each agreement giving rise to a
Receivable (other than any right of termination).
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(b) Each Pledgor will deliver to the Agent a copy of each material
demand, notice or document received by it that questions the validity or
enforceability of more than 5% of the aggregate amount of the then outstanding
Receivables.
6. Provisions Relating to Contracts.
6.1 Pledgor Remains Liable under Contracts. Anything herein to the
contrary notwithstanding, each Pledgor shall remain liable under each of the
Contracts to observe and perform all the conditions and obligations to be
observed and performed by it thereunder, all in accordance with and pursuant to
the terms and provisions of such Contract. Neither the Agent nor any Lender
shall have any obligation or liability under any Contract by reason of or
arising out of this Agreement or the receipt by the Agent or any such Lender of
any payment relating to such Contract pursuant hereto, nor shall the Agent or
any Lender be obligated in any manner to perform any of the obligations of such
Pledgor under or pursuant to any Contract, to make any payment, to make any
inquiry as to the nature or the sufficiency of any payment received by it or as
to the sufficiency of any performance by any party under any Contract, to
present or file any claim, to take any action to enforce any performance or to
collect the payment of any amounts which may have been assigned to it or to
which it may be entitled at any time or times.
6.2 Communication With Contracting Parties. Upon the occurrence and
continuance of an Event of Default, the Agent in its own name or in the name of
others may communicate with parties to the Contracts to verify with them to the
Agent's satisfaction the existence, amount and terms of any Contracts.
6.3 Representations and Warranties. (a) No consent of any party
(other than any Pledgor) to any Contract is required, or purports to be
required, in connection with the execution, delivery and performance of this
Agreement other than any consent that has been received.
(b) Each Contract is in full force and effect and constitutes a valid
and legally enforceable obligation of the parties thereto, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
(c) No consent or authorization of, filing with or other act by or in
respect of any Governmental Authority is required in connection with the
execution, delivery, performance, validity or enforceability of any of the
Contracts by any party thereto other than those which have been duly obtained,
made or performed, are in full force and effect and do not subject the scope of
any such Contract to any material adverse limitation, either specific or
general in nature.
(d) Each Pledgor warrants that such Pledgor is not, nor (to the best
of such Pledgor's knowledge) are any of the other parties to the Contracts, in
default in the performance or
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observance of any of the terms thereof, that, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
(e) The right, title and interest of each Pledgor in, to and under
the Contracts are not subject to any defenses, offsets, counterclaims or
claims, except, in each case, for any defenses, offsets, counterclaims and
claims that, in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
(f) Each Pledgor has made available to the Agent a complete and
correct copy of each Contract, including all amendments, supplements and other
modifications thereto.
(g) No amount payable to any Pledgor under or in connection with any
Contract is evidenced by any Instrument or Chattel Paper which has not been
delivered to the Agent.
(h) None of the parties to any Contract is a Governmental Authority.
Schedule 1 accurately specifies all contracts, agreements, instruments or
indentures referred to in clauses (i), (ii) and (iii) of the definition of
"Contracts" in subsection 1.1.
6.4 Covenants. Except as otherwise provided in the Credit Agreement:
(a) each Pledgor will perform and comply in all material respects with all its
obligations under the Contracts.
(b) Each Pledgor will not amend, modify, terminate or waive any
provision of any Contract in any manner which could reasonably be expected to
materially adversely affect the value of such Contract as Collateral. Such
Pledgor will exercise promptly and diligently each and every material right
which it may have under each Contract (other than any right of termination).
(c) Such Pledgor will deliver to the Agent a copy of each material
demand, notice or document received by it relating in any way to any Contract
that questions the validity or enforceability of such Contract.
7. Provisions Relating to Patents and Trademarks.
7.1 Representations and Warranties. (a) Schedule 2 includes all
material Patents and Patent Licenses owned by each Pledgor in its own name on
the date hereof.
(b) Schedule 3 includes all material Trademarks and Trademark
Licenses owned by each Pledgor in its own name on the date hereof.
(c) To the best of each Pledgor's knowledge, each such Patent and
Trademark is on the date hereof valid, subsisting, unexpired, enforceable and
has not been abandoned.
(d) Except as set forth in either Schedule 2 or Schedule 3, none of
such Patents and Trademarks is on the date hereof the subject of any licensing
or franchise agreement.
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(e) No holding, decision or judgment has been rendered by any
Governmental Authority which would limit, cancel or question the validity of
any Patent or Trademark in any respect that could reasonably be expected to
have a Material Adverse Effect.
(f) No action or proceeding is pending on the date hereof seeking to
limit, cancel or question the validity of any Patent or Trademark, or which,
if adversely determined, would have a material adverse effect on the value of
any Patent or Trademark.
7.2 Covenants.
(a) Each Pledgor (either itself or through licensees) will (i)
continue to use each material Trademark on each and every trademark class of
goods applicable to its current line as reflected in its current catalogs,
brochures and price lists in order to maintain such Trademark in full force
free from any claim of abandonment for non-use, (ii) maintain as in the past
the quality of products and services offered under such Trademark, (iii) employ
such Trademark with the appropriate notice of registration, (iv) not adopt or
use any ▇▇▇▇ which is confusingly similar or a colorable imitation of such
Trademark unless the Agent, for the ratable benefit of the Lenders, shall
obtain a perfected security interest in such ▇▇▇▇ pursuant to this Agreement,
and (v) not (and not permit any licensee or sublicensee thereof to) do any act
or knowingly omit to do any act whereby such Trademark may become invalidated.
(b) Each Pledgor will not do any act, or omit to do any act, whereby
any material Patent may become abandoned or dedicated.
(c) Each Pledgor will notify the Agent and the Lenders immediately if
it knows, or has reason to know, that any application or registration relating
to any material Patent or Trademark may become abandoned or dedicated, or of
any adverse determination or development (including, without limitation, the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office or any court or tribunal in any
country) regarding such Pledgor's ownership of any material Patent or Trademark
or its right to register the same or to keep and maintain the same.
(d) Whenever each Pledgor, either by itself or through any agent,
employee, licensee or designee, shall file an application for the registration
of any Patent or Trademark with the United States Patent and Trademark Office
or any similar office or agency in any other country or any political
subdivision thereof, such Pledgor shall report such filing to the Agent and the
Lenders within five Business Days after the last day of the fiscal quarter in
which such filing occurs. Upon request of the Agent, such Pledgor shall
execute and deliver any and all agreements, instruments, documents, and papers
as the Agent may request to evidence the Agent's and the Lenders' security
interest in any Patent or Trademark and the goodwill and general intangibles of
such Pledgor relating thereto or represented thereby.
(e) Each Pledgor will take all reasonable and necessary steps,
including, without limitation, in any proceeding before the United States
Patent and Trademark Office, or any similar office or agency in any other
country or any political subdivision thereof, to maintain and pursue each
application (and to obtain the relevant registration) and to maintain each
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registration of the material Patents and Trademarks, including, without
limitation, filing of applications for renewal, affidavits of use and
affidavits of incontestability.
(f) In the event that any Patent or Trademark included in the
Collateral is infringed, misappropriated or diluted by a third party, each
Pledgor shall (i) take such actions as such Pledgor shall reasonably deem
appropriate under the circumstances to protect such Patent or Trademark and
(ii) if such Patent or Trademark is of material economic value, promptly notify
the Agent and the Lenders after it learns thereof and ▇▇▇ for infringement,
misappropriation or dilution, to seek injunctive relief where appropriate and
to recover any and all damages for such infringement, misappropriation or
dilution.
8. Provisions Relating to Vehicles.
8.1 Representation and Warranty. Upon the occurrence and continuance
of an Event of Default, and upon the request of the Agent, each Pledgor shall
provide within 20 days of such request, a complete and correct list of all
Vehicles owned by each Pledgor on such date.
8.2 Covenants.
(a) Upon the occurrence and continuance of an Event of Default, no
Vehicle shall be removed from the state which has issued the certificate of
title/ownership therefor for a period in excess of 30 days.
(b) Within 30 days of the date of Agent's request to do so, all
applications for certificates of title/ownership indicating the Agent's first
priority security interest in the Vehicle covered by such certificate, and any
other necessary documentation, shall be filed in each office in each
jurisdiction which the Agent shall deem advisable to perfect its security
interests in the Vehicles.
9. Remedies.
9.1 Notice to Obligors and Contract Parties. Upon the request of the
Agent at any time after the occurrence and during the continuance of an Event
of Default, each Pledgor shall notify obligors on the Receivables and parties
to the Contracts that the Receivables and the Contracts have been assigned to
the Agent for the ratable benefit of the Lenders and that payments in respect
thereof shall be made directly to the Agent.
9.2 Proceeds to be Turned Over To Agent. In addition to the rights
of the Agent and the Lenders specified in subsection 5.3 with respect to
payments of Receivables, if an Event of Default shall occur and be continuing,
upon the written notice of the Agent, all Proceeds received by each Pledgor
consisting of cash, checks and other near-cash items shall be held by such
Pledgor in trust for the Agent and the Lenders, segregated from other funds of
such Pledgor, and shall, forthwith upon receipt by such Pledgor, be turned over
to the Agent in the exact form received by such Pledgor (duly indorsed by such
Pledgor to the Agent, if required) and held by the Agent in a Collateral
Account maintained under the sole dominion and control of the Agent. All
Proceeds while held by the Agent in a Collateral Account (or by a
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Pledgor in trust for the Agent and the Lenders) shall continue to be held as
collateral security for all the Secured Obligations and shall not constitute
payment thereof until applied as provided in subsection 9.3.
9.3 Application of Proceeds. At such intervals as may be agreed upon
by each Pledgor and the Agent, or, if an Event of Default shall have occurred
and be continuing, at any time at the Agent's election, the Agent may apply all
or any part of Proceeds held in any Collateral Account in payment of the
Secured Obligations in such order as the Agent may elect, and any part of such
funds which the Agent elects not so to apply and deems not required as
collateral security for the Secured Obligations shall be paid over from time to
time by the Agent to such Pledgor or to whomsoever may be lawfully entitled to
receive the same. Any balance of such Proceeds remaining after the Secured
Obligations shall have been paid in full and the Commitments shall have expired
or otherwise been terminated shall be paid over to such Pledgor or to
whomsoever may be lawfully entitled to receive the same.
9.4 Code Remedies. If an Event of Default shall occur and be
continuing, the Agent, on behalf of the Lenders may exercise, in addition to
all other rights and remedies granted to them in this Agreement and in any
other instrument or agreement securing, evidencing or relating to the Secured
Obligations, all rights and remedies of a secured party under the Code.
Without limiting the generality of the foregoing, the Agent, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon any
Pledgor or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase, or otherwise dispose of and deliver the Collateral or any part
thereof (or contract to do any of the foregoing), in one or more parcels at
public or private sale or sales, at any exchange, broker's board or office of
the Agent or any Lender or elsewhere upon such terms and conditions as it may
deem advisable and at such prices as it may deem best, for cash or on credit or
for future delivery without assumption of any credit risk. The Agent or any
Lender shall have the right upon any such public sale or sales, and, to the
extent permitted by law, upon any such private sale or sales, to purchase the
whole or any part of the Collateral so sold, free of any right or equity of
redemption in any Pledgor, which right or equity is hereby waived or released.
Each Pledgor further agrees, at the Agent's request, to assemble the Collateral
and make it available to the Agent at places which the Agent shall reasonably
select, whether at such Pledgor's premises or elsewhere. The Agent shall apply
the net proceeds of any action taken by it pursuant to this subsection, after
deducting all reasonable costs and expenses of every kind incurred in
connection therewith or incidental to the care or safekeeping of any of the
Collateral or in any way relating to the Collateral or the rights of the Agent
and the Lenders hereunder, including, without limitation, reasonable attorneys'
fees and disbursements, to the payment in whole or in part of the Secured
Obligations, in such order as the Agent may elect, and only after such
application and after the payment by the Agent of any other amount required by
any provision of law, including, without limitation, Section 9- 504(1)(c) of
the Code, need the Agent account for the surplus, if any, to such Pledgor. To
the extent permitted by applicable law, each Pledgor waives all claims, damages
and demands it may acquire against the Agent or any Lender arising out of the
exercise by
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them of any rights hereunder. If any notice of a proposed sale or other
disposition of Collateral shall be required by law, such notice shall be deemed
reasonable and proper if given at least 10 days before such sale or other
disposition.
9.5 Waiver; Deficiency. Each Pledgor waives and agrees not to assert
any rights or privileges which it may acquire solely under Section 9-112 of the
Code. Each such Pledgor will remain liable for any deficiency if the proceeds
of any sale or other disposition of the Collateral are insufficient to pay the
Secured Obligations and the fees and disbursements of any attorneys employed by
the Agent or any Lender to collect such deficiency.
10. Agent's Appointment as Attorney-in-Fact; Agent's Performance of
Pledgors' Obligations.
10.1 Powers. Each Pledgor hereby irrevocably constitutes and appoints
the Agent and any officer or agent thereof, with full power of substitution, as
its true and lawful attorney-in-fact with full irrevocable power and authority
in the place and stead of such Pledgor and in the name of such Pledgor or in
its own name, from time to time in the Agent's discretion, for the purpose of
carrying out the terms of this Agreement, to take any and all appropriate
action and to execute any and all documents and instruments which may be
necessary or desirable to accomplish the purposes of this Agreement, and,
without limiting the generality of the foregoing, each Pledgor hereby gives the
Agent the power and right, on behalf of such Pledgor, without notice to or
assent by such Pledgor, to do any or all of the following:
(a) in the name of such Pledgor or its own name, or
otherwise, take possession of and indorse and collect any checks,
drafts, notes, acceptances or other instruments for the payment of
moneys due under any Receivable or Contract or with respect to any
other Collateral and file any claim or take any other action or
proceeding in any court of law or equity or otherwise deemed
appropriate by the Agent for the purpose of collecting any and all
such moneys due under any Receivable or Contract or with respect to
any other Collateral whenever payable;
(b) in the case of any Patent or Trademark, execute and
deliver any and all agreements, instruments, documents and papers as
the Agent may request to evidence the Agent's and the Lenders'
security interest in such Patent or Trademark and the goodwill and
general intangibles of the Pledgor relating thereto or represented
thereby;
(c) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance
called for by the terms of this Agreement and pay all or any part of
the premiums therefor and the costs thereof;
(d) execute, in connection with the sale provided for in
subsection 9.4 hereof, any indorsements, assignments or other
instruments of conveyance or transfer with respect to the Collateral;
and
(e) (i) direct any party liable for any payment under any of
the Collateral to make payment of any and all moneys due or to become
due thereunder directly to the
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Agent or as the Agent shall direct; (ii) ask or demand for, collect,
receive payment of and receipt for, any and all moneys, claims and
other amounts due or to become due at any time in respect of or
arising out of any Collateral; (iii) sign and indorse any invoices,
freight or express bills, bills of lading, storage or warehouse
receipts, drafts against debtors, assignments, verifications, notices
and other documents in connection with any of the Collateral; (iv)
commence and prosecute any suits, actions or proceedings at law or in
equity in any court of competent jurisdiction to collect the
Collateral or any thereof and to enforce any other right in respect of
any Collateral; (v) defend any suit, action or proceeding brought
against any Pledgor with respect to any Collateral; (vi) settle,
compromise or adjust any such suit, action or proceeding and, in
connection therewith, to give such discharges or releases as the Agent
may deem appropriate; (vii) assign any Patent or Trademark (along with
the goodwill of the business to which any such Patent or Trademark
pertains), throughout the world for such term or terms, on such
conditions, and in such manner, as the Agent shall in its sole
discretion determine; and (viii) generally, sell, transfer, pledge and
make any agreement with respect to or otherwise deal with any of the
Collateral as fully and completely as though the Agent were the
absolute owner thereof for all purposes, and do, at the Agent's option
and such Pledgor's expense, at any time, or from time to time, all
acts and things which the Agent deems necessary to protect, preserve
or realize upon the Collateral and the Agent's and the Lenders'
security interests therein and to effect the intent of this Agreement,
all as fully and effectively as the Pledgor might do.
Anything in this subsection to the contrary notwithstanding,
the Agent agrees that it will not exercise any rights under the power
of attorney provided for in this subsection unless an Event of Default
shall have occurred and be continuing.
10.2 Performance by Agent of Pledgors' Obligations. If any Pledgor
fails to perform or comply with any of its agreements contained herein, the
Agent, at its option, but without any obligation so to do, may perform or
comply, or otherwise cause performance or compliance, with such agreement.
10.3 Pledgors' Reimbursement Obligation. The expenses of the Agent
incurred in connection with actions undertaken as provided in this Section,
together with interest thereon at a rate per annum equal to the rate per annum
at which interest would then be payable on past due Base Rate Loans under the
Credit Agreement, from the date of payment by the Agent to the date reimbursed
by the relevant Pledgor, shall be payable by such Pledgor to the Agent on
demand.
10.4 Ratification; Power Coupled With An Interest. Each Pledgor
hereby ratifies all that said attorneys shall lawfully do or cause to be done
by virtue hereof. All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this Agreement
is terminated and the security interests created hereby are released.
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16
11. Duty of Agent. The Agent's sole duty with respect to the
custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9-207 of the Code or otherwise, shall be to deal with
it in the same manner as the Agent deals with similar property for its own
account. Neither the Agent, any Lender nor any of their respective officers,
directors, employees or agents shall be liable for failure to demand, collect
or realize upon any of the Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Collateral upon the
request of the Pledgor or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof. The powers
conferred on the Agent and the Lenders hereunder are solely to protect the
Agent's and the Lenders' interests in the Collateral and shall not impose any
duty upon the Agent or any Lender to exercise any such powers. The Agent and
the Lenders shall be accountable only for amounts that they actually receive as
a result of the exercise of such powers, and neither they nor any of their
officers, directors, employees or agents shall be responsible to any Pledgor
for any act or failure to act hereunder, except for their own gross negligence
or willful misconduct.
12. Execution of Financing Statements. Pursuant to Section 9-402 of
the Code, each Pledgor authorizes the Agent to file financing statements with
respect to the Collateral without the signature of such Pledgor in such form
and in such filing offices as the Agent reasonably determines appropriate to
perfect the security interests of the Agent under this Agreement. A carbon,
photographic or other reproduction of this Agreement shall be sufficient as a
financing statement for filing in any jurisdiction.
13. Authority of Agent. Each Pledgor acknowledges that the rights
and responsibilities of the Agent under this Agreement with respect to any
action taken by the Agent or the exercise or non-exercise by the Agent of any
option, voting right, request, judgment or other right or remedy provided for
herein or resulting or arising out of this Agreement shall, as between the
Agent and the Lenders, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Agent and such Pledgor, the Agent shall be conclusively presumed
to be acting as agent for the Lenders with full and valid authority so to act
or refrain from acting, and such Pledgor shall be under no obligation, or
entitlement, to make any inquiry respecting such authority.
14. Notices. All notices, requests and demands pursuant hereto shall
be made in accordance with Section 12 of the Subsidiaries Guarantee.
15. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
16. Amendments in Writing; No Waiver; Cumulative Remedies.
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16.1 Amendments in Writing. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except by
a written instrument executed by each Pledgor and the Agent, provided that any
provision of this Agreement imposing obligations on any Pledgor may be waived
by the Agent in a written instrument executed by the Agent.
16.2 No Waiver by Course of Conduct. Neither the Agent nor any Lender
shall by any act (except by a written instrument pursuant to subsection 16.1),
delay, indulgence, omission or otherwise be deemed to have waived any right or
remedy hereunder or to have acquiesced in any Default or Event of Default. No
failure to exercise, nor any delay in exercising, on the part of the Agent or
any Lender, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Agent or any Lender of
any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which the Agent or such Lender would otherwise have
on any future occasion.
16.3 Remedies Cumulative. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of
any other rights or remedies provided by law.
17. Section Headings. The Section and subsection headings used in
this Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation
hereof.
18. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of each Pledgor and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
19. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the undersigned has caused this Security Agreement
to be duly executed and delivered as of the date first above written.
[ ]
By:_________________________________
212
SCHEDULE 1
TO SUBSIDIARIES
SECURITY AGREEMENT
CONTRACTS
213
SCHEDULE 2
TO SUBSIDIARIES
SECURITY AGREEMENT
PATENTS AND PATENT LICENSES
214
SCHEDULE 3
TO SUBSIDIARIES
SECURITY AGREEMENT
TRADEMARKS AND TRADEMARK LICENSES
215
SCHEDULE 4
TO SUBSIDIARIES
SECURITY AGREEMENT
VEHICLES
216
SCHEDULE 5
TO SUBSIDIARIES
SECURITY AGREEMENT
FILINGS AND OTHER ACTIONS
REQUIRED TO PERFECT SECURITY INTERESTS
Uniform Commercial Code Filings
-------------------------------
Patent and Trademark Filings
----------------------------
Other Actions
-------------
217
SCHEDULE 6
TO SUBSIDIARIES
SECURITY AGREEMENT
INVENTORY AND EQUIPMENT
Item Location
---- --------
218
EXHIBIT G
TO THE
CREDIT AGREEMENT
FORM OF BORROWING CERTIFICATE
[NAME OF LOAN PARTY]
Pursuant to subsection 4.1(c) of the Credit Agreement dated as
of July __, 1997 (the "Credit Agreement"; terms defined therein being used
herein as therein defined), among Travel Channel Acquisition Corporation, the
several banks and other financial institutions from time to time parties
thereto, and Union Bank of California, N.A., as Agent, the undersigned
____________ of ____________(the "Certifying Loan Party") hereby certifies as
follows:
1. The representations and warranties of the Certifying
Loan Party set forth in each of the Loan Documents to which it is a
party or which are contained in any certificate furnished by or on
behalf of the Certifying Loan Party pursuant to or in connection with
any of the Loan Documents to which it is a party are true and correct
in all material respects on and as of the date hereof with the same
effect as if made on the date hereof except for representations and
warranties expressly stated to relate to a specific earlier date, in
which case such representations and warranties are true and correct in
all material respects as of such earlier date;
2. No Default or Event of Default shall have occurred
and be continuing as of the date hereof or after giving effect to the
Loans to be made on the date hereof;
3. ___________ is and at all times since ___ __, 199_
has been, the duly elected and qualified [Assistant] Secretary of the
Certifying Loan Party and the signature set forth for such officer
below is such officer's true and genuine signature;
and the undersigned [Assistant] Secretary of the Certifying Loan Party
certifies as follows:
4. There are no liquidation or dissolution proceedings
pending or to my knowledge threatened against the Certifying Loan
Party, nor has any other event occurred adversely affecting or
threatening the continued corporate existence of the Certifying Loan
Party after the date hereof;
5. The Certifying Loan Party is a corporation duly
incorporated, validly existing and in good standing under the laws of
the jurisdiction of its organization;
6. Attached hereto as Annex 1 is a correct and complete
copy of resolutions duly adopted by the Board of Directors of the
Certifying Loan Party on _______, 1997 authorizing (i) the execution,
delivery and performance of the Loan Documents to which it is a party
and (ii) the transactions contemplated by the Loan
219
2
Documents to which it is a party; such resolutions have not in any way
been amended, modified, revoked or rescinded and have been in full
force and effect since their adoption to and including the date hereof
and are now in full force and effect; such resolutions are the only
corporate proceedings of the Certifying Loan Party now in force
relating to or affecting the matters referred to therein; attached
hereto as Annex 2 is a correct and complete copy of the By-Laws of the
Certifying Loan Party as in effect at all times since ____ __, 199_ to
and including the date hereof; and attached hereto as Annex 3 is a
correct and complete copy of the Certificate of Incorporation of the
Certifying Loan Party as in effect at all times since ____ __, 199_ to
and including the date hereof, and such certificate has not been
amended, repealed, modified or restated;
7. The following persons are now duly elected and
qualified officers of the Certifying Loan Party holding the offices
indicated next to their respective names below, and such officers have
held such offices with the Certifying Loan Party at all times since
the date indicated next to their respective titles to and including
the date hereof, and the signatures appearing opposite their
respective names below are the true and genuine signatures of such
officers, and each of such officers is duly authorized to execute and
deliver on behalf of the Certifying Loan Party, each of the Loan
Documents to which it is a party, and each of such officers is duly
authorized to execute and deliver on behalf of the Certifying Loan
Party any certificate or other document to be delivered by the
Certifying Loan Party pursuant to the Loan Documents to which it is a
party:
Name Office Signature
---- ------ ---------
_________________ ______ (since ____, 19_) ____________________
_________________ ______ (since ____, 19_) ____________________
_________________ ______ (since ____, 19_) ____________________
_________________ ______ (since ____, 19_) ____________________
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3
IN WITNESS WHEREOF, the undersigned have hereunto set our
names as of the date set forth below.
By:___________________________ By:__________________________
Title: Title: [Assistant] Secretary
Date: ________________, 1997
221
ANNEX 1
Resolutions
ANNEX 2
By-Laws
ANNEX 3
Certificate of Incorporation
222
EXHIBIT H
TO THE
CREDIT AGREEMENT
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement, dated as of July
__, 1997 (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among Travel Channel Acquisition Corporation (the
"Borrower"), the Lenders named therein and Union Bank of California, N.A., as
agent for the Lenders (in such capacity, the "Agent"). Unless otherwise defined
herein, terms defined in the Credit Agreement and used herein shall have the
meanings given to them in the Credit Agreement.
The Assignor identified on Schedule l hereto (the "Assignor")
and the Assignee identified on Schedule l hereto (the "Assignee") agree as
follows:
1. The Assignor hereby irrevocably sells and assigns to
the Assignee without recourse to the Assignor, and the Assignee hereby
irrevocably purchases and assumes from the Assignor without recourse to the
Assignor, as of the Effective Date (as defined below), the interest described
in Schedule 1 hereto (the "Assigned Interest") in and to the Assignor's rights
and obligations under the Credit Agreement with respect to those credit
facilities contained in the Credit Agreement as are set forth on Schedule 1
hereto (individually, an "Assigned Facility"; collectively, the "Assigned
Facilities"), in a principal amount for each Assigned Facility as set forth on
Schedule 1 hereto.
2. The Assignor (a) makes no representation or warranty
and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or with
respect to the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement, any other Loan Document or any
other instrument or document furnished pursuant thereto, other than that the
Assignor has not created any adverse claim upon the interest being assigned by
it hereunder and that such interest is free and clear of any such adverse
claim; (b) makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Borrower, any of its
Subsidiaries or any other obligor or the performance or observance by the
Borrower, any of its Subsidiaries or any other obligor of any of their
respective obligations under the Credit Agreement or any other Loan Document or
any other instrument or document furnished pursuant hereto or thereto; and (c)
attaches any Notes held by it evidencing the Assigned Facilities and (i)
requests that the Agent, upon request by the Assignee, exchange the attached
Notes for a new Note or Notes payable to the Assignee and (ii) if the Assignor
has retained any interest in the Assigned Facility, requests that the Agent
exchange the attached Notes for a new Note or Notes payable to the Assignor, in
each case in amounts which reflect the assignment being made hereby (and after
giving effect to any other assignments which have become effective on the
Effective Date).
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2
3. The Assignee (a) represents and warrants that it is
legally authorized to enter into this Assignment and Acceptance; (b) confirms
that it has received a copy of the Credit Agreement, together with copies of
the financial statements delivered pursuant to subsection 3.3 thereof and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Assignment and Acceptance; (c)
agrees that it will, independently and without reliance upon the Assignor, the
Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Credit Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto or
thereto; (d) appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers and discretion under the Credit
Agreement, the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto as are delegated to the Agent by the terms
thereof, together with such powers as are incidental thereto; and (e) agrees
that it will be bound by the provisions of the Credit Agreement and will
perform in accordance with its terms all the obligations which by the terms of
the Credit Agreement are required to be performed by it as a Lender including,
if it is organized under the laws of a jurisdiction outside the United States,
its obligation pursuant to subsection 2.15(b) of the Credit Agreement.
4. The effective date of this Assignment and Acceptance
shall be the Effective Date of Assignment described in Schedule 1 hereto (the
"Effective Date"). Following the execution of this Assignment and Acceptance,
it will be delivered to the Agent for acceptance by it and recording by the
Agent pursuant to the Credit Agreement, effective as of the Effective Date
(which shall not, unless otherwise agreed to by the Agent, be earlier than five
Business Days after the date of such acceptance and recording by the Agent).
5. Upon such acceptance and recording, from and after
the Effective Date, the Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignor for amounts which have accrued to the Effective Date
and to the Assignee for amounts which have accrued subsequent to the Effective
Date. The Assignor and the Assignee shall make all appropriate adjustments in
payments by the Agent for periods prior to the Effective Date or with respect
to the making of this assignment directly between themselves.
6. From and after the Effective Date, (a) the Assignee
shall be a party to the Credit Agreement and, to the extent provided in this
Assignment and Acceptance, have the rights and obligations of a Lender
thereunder and under the other Loan Documents and shall be bound by the
provisions thereof and (b) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Credit Agreement.
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3
7. THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance to be executed as of the date first above written by
their respective duly authorized officers on Schedule 1 hereto.
225
Schedule 1
to Assignment and Acceptance
Name of Assignor: __________________________________________________________
Name of Assignee: __________________________________________________________
Effective Date of Assignment: ______________________________________________
Credit Principal
Facility Assigned Amount Assigned Commitment Percentage Assigned*
---------------------- -------------------- -------------------------------------
$_______________ ___._______________%
[Name of Assignee] [Name of Assignor]
By: ___________________________________________ By: _______________________________________
Title: Title:
Accepted: [Consented To:
UNION BANK OF CALIFORNIA N.A., as Agent TRAVEL CHANNEL ACQUISITION
CORPORATION
By: _______________________________________
By: ___________________________________________ Title:]
Title:
__________________________________
* Calculate the Commitment Percentage that is assigned to at least 15 decimal
places and show as a percentage of the aggregate commitments of all
Lenders.
226
▇▇▇▇▇▇ PLEDGE AGREEMENT
▇▇▇▇▇▇ PLEDGE AGREEMENT, dated as of July 11, 1997, made by
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, an individual residing on the date hereof at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, and Second ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited
Partnership, a Nevada limited Partnership (the "Pledgors"), in favor of Union
Bank of California, N.A., as Agent (in such capacity, the "Agent") for the
Lenders parties to the Credit Agreement, dated as of July 11, 1997, (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement"),
among Travel Channel Acquisition Corporation (the "Borrower"), the Agent and
such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS, the Pledgors are the legal and beneficial owners of the shares
of Pledged Stock (as hereinafter defined) issued by the Issuer (as hereinafter
defined); and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
the Pledgors shall have executed and delivered this Pledge Agreement to the
Agent for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce
the Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans under the Credit Agreement, the Pledgors
hereby agree with the Agent, for the ratable benefit of the Lenders, as follows:
1. Defined Terms. (a) Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": this Pledge Agreement, as the same may be amended,
modified or otherwise supplemented from time to time.
"Code": the Uniform Commercial Code from time to time in effect in the
State of New York.
"Collateral": the Pledged Stock and all Proceeds.
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2
"Collateral Account": any account established to hold money Proceeds,
maintained under the sole dominion and control of the Agent, subject to
withdrawal by the Agent for the account of the Lenders only as provided in
subsection 8(a).
"Issuer": the company identified on Schedule 1 attached hereto as the
issuer of the Pledged Stock.
"Pledged Stock": the shares of capital stock listed on Schedule 1
hereto, together with all stock certificates, options or rights of any nature
whatsoever that may be issued or granted by the Issuer to the Pledgors in
respect of the Pledged Stock while this Agreement is in effect.
"Proceeds": all "proceeds" as such term is defined in Section 9-306(1)
of the Uniform Commercial Code in effect in the State of New York on the date
hereof and, in any event, shall include, without limitation, all dividends or
other income from the Pledged Stock, collections thereon or distributions with
respect thereto.
"Secured Obligations": the collective reference to (a) the Obligations
and (b) all obligations and liabilities of the Pledgors which may arise under or
in connection with this Agreement or any other Loan Document to which the
Pledgors are a party, whether on account of reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
fees and disbursements of counsel to the Agent or to the Lenders that are
required to be paid by the Pledgors pursuant to the terms of this Agreement or
any other Loan Document to which the Pledgors are a party).
"Securities Act": the Securities Act of 1933, as amended.
"Stockholders' Agreement": the Amended and Restated Stockholders'
Agreement of the Borrower dated as of December 22, 1994, as the same may be
amended, supplemented or otherwise modified from time to time.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section and paragraph
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Pledge; Grant of Security Interest. The Pledgors hereby deliver to
the Agent, for the ratable benefit of the Lenders, all the Pledged Stock and
hereby grant to Agent, for the ratable benefit of the Lenders, a first security
interest in the Collateral, as collateral security for the prompt and complete
payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of the Obligations.
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3
3. Stock Powers. (a) Concurrently with the delivery to the Agent of
each certificate representing one or more shares of Pledged Stock to the Agent,
the Pledgors shall deliver an undated stock power covering such certificate,
duly executed in blank by the Pledgors with, if the Agent so requests, signature
guaranteed.
(b) The Pledgors shall deliver to the Agent an Acknowledgement and
Consent, substantially in the form of Exhibit A to this Agreement, duly executed
by the Issuer of such Pledged Stock.
4. Representations and Warranties. The Pledgors represent and warrant
that:
(a) All the shares of the Pledged Stock have been duly and validly
issued and are fully paid and nonassessable.
(b) The Pledgors are the record and beneficial owners of, and have good
and marketable title to, the Pledged Stock, free of any and all Liens or options
in favor of, or claims of, any other Person, except the security interest
created by this Agreement and the terms and conditions of the Stockholders'
Agreement; provided that after consideration of the Stockholders' Agreement,
this Agreement and the laws of the State of New York contain adequate remedial
provisions for the practical realization of the rights and benefits purported to
be afforded thereby.
(c) Upon delivery to the Agent of the stock certificates evidencing the
Pledged Stock, the security interest created pursuant to this Agreement will
constitute a valid, perfected first priority security interest in the
Collateral, enforceable in accordance with its terms against all creditors of
the Pledgors and any Persons purporting to purchase any Collateral from the
Pledgors, except in each case as enforceability may be affected by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
(d) The Pledgors have obtained from the Issuer and have delivered to
the Agent an Acknowledgement and Consent, substantially in the form attached
hereto as Exhibit A, executed by the Issuer.
5. Covenants. The Pledgors covenant and agree with the Agent and the
Lenders that, from and after the date of this Agreement until this Agreement is
terminated and the security interests created hereby are released:
(a) If the Pledgors shall, as a result of their ownership of the
Pledged Stock, become entitled to receive or shall receive any stock certificate
(including, without limitation, any certificate representing a stock dividend or
a distribution in connection with any reclassification, increase or reduction of
capital or any certificate issued in connection with any reorganization), option
or rights, whether in addition to, in substitution of, as a conversion of, or in
exchange for any shares of the Pledged Stock, or otherwise in respect thereof,
the Pledgors shall accept the same as the agent of the Agent and the Lenders,
hold the same in
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4
trust for the Agent and the Lenders and deliver the same forthwith to the Agent
in the exact form received, duly indorsed by the Pledgors to the Agent, if
required, together with an undated stock power covering such certificate duly
executed in blank by the Pledgors and with, if the Agent so requests, signature
guaranteed, to be held by the Agent, subject to the terms hereof, as additional
collateral security for the Obligations. Any sums paid upon or in respect of the
Pledged Stock upon the liquidation or dissolution of the Issuer shall be paid
over to the Agent to be held by it hereunder as additional collateral security
for the Obligations, and in case any distribution of capital shall be made on or
in respect of the Pledged Stock or any property shall be distributed upon or
with respect to the Pledged Stock pursuant to the recapitalization or
reclassification of the capital of the Issuer or pursuant to the reorganization
thereof, the property so distributed shall be delivered to the Agent to be held
by it hereunder as additional collateral security for the Obligations. If any
sums of money or property so paid or distributed in respect of the Pledged Stock
shall be received by the Pledgors, the Pledgors shall, until such money or
property is paid or delivered to the Agent, hold such money or property in trust
for the Lenders, segregated from other funds of the Pledgors, as additional
collateral security for the Obligations.
(b) Without the prior written consent of the Agent (or except as (i)
expressly permitted under the terms of the PCC Credit Agreement or (ii) provided
under the Stockholders' Agreement), the Pledgors will not (i) sell, assign,
transfer, exchange, or otherwise dispose of, or grant any option with respect
to, the Collateral, (ii) create, incur or permit to exist any Lien or option in
favor of, or any claim of any Person with respect to, any of the Collateral, or
any interest therein, except for the security interests created by this
Agreement or (iii) enter into any agreement or undertaking restricting the right
or ability of the Pledgors or the Agent to sell, assign or transfer any of the
Collateral.
(c) The Pledgors shall maintain the security interest created by this
Agreement as a first, perfected security interest and shall defend such security
interest against claims and demands of all Persons other than the Agent. At any
time and from time to time, upon the written request of the Agent, and at the
sole expense of the Pledgors, the Pledgors will promptly and duly execute and
deliver such further instruments and documents and take such further actions as
the Agent may reasonably request for the purposes of obtaining or preserving the
full benefits of this Agreement and of the rights and powers herein granted. If
any amount payable under or in connection with any of the Collateral shall be or
become evidenced by any promissory note, other instrument or chattel paper, such
note, instrument or chattel paper shall be immediately delivered to the Agent,
duly endorsed if necessary in a manner satisfactory to the Agent, to be held as
Collateral pursuant to this Agreement.
(d) The Pledgors shall pay, and save the Agent and the Lenders harmless
from, any and all liabilities with respect to, or resulting from any delay in
paying, any and all stamp, excise, sales or other taxes and any and all
recording and filing fees which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions
contemplated by this Agreement.
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(e) The Pledgors will not take or omit to take any action, the taking
or the omission of which would result in an alteration or impairment of the
Collateral or the security of this Agreement, except as otherwise expressly
permitted under the terms of the Credit Agreement.
(f) The Pledgors will not enter into any agreement amending or
supplementing the Collateral, except as otherwise expressly permitted under the
terms of the Credit Agreement.
(g) The Pledgors will not waive or release any obligation of any party
to the Collateral, except as otherwise expressly permitted under the terms of
the Credit Agreement.
(h) Unless directed otherwise by the Agent, the Pledgors will exercise
promptly and diligently each and every material right which it may have under
the Collateral (except the right to release or cancel).
(i) The Pledgors will not take or omit to take any action or 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 Collateral.
(j) Upon the occurrence and continuance of an Event of Default, the
Pledgors will give the Agent copies of all material notices (including notices
of default) given or received with respect to the Collateral, promptly after
giving or receiving such notices.
6. Cash Dividends; Voting Rights. Unless an Event of Default shall have
occurred and be continuing and the Agent shall have given notice to the Pledgors
of the Agent's intent to exercise its corresponding rights pursuant to Section 7
below, the Pledgors shall be permitted to receive all cash dividends paid in the
normal course of business of the Issuer and consistent with past practice, to
the extent permitted in the Credit Agreement, in respect of the Pledged Stock
and to exercise all voting and corporate rights with respect to the Pledged
Stock; provided, however, that no vote shall be cast or corporate right
exercised or other action taken which, in the Agent's reasonable judgment, would
impair the Collateral or which would be inconsistent with or result in any
violation of any provision of the Credit Agreement, the Notes, this Agreement or
any other Loan Document.
7. Rights of the Lenders and the Agent. (a) All money Proceeds received
by the Agent hereunder shall be held by the Agent for the benefit of the Lenders
in a Collateral Account. All Proceeds while held by the Agent in a Collateral
Account (or by the Pledgors in trust for the Agent and the Lenders) shall
continue to be held as collateral security for all the Obligations and shall not
constitute payment thereof until applied as provided in subsection 8(a).
(b) If an Event of Default shall occur and be continuing and the Agent
shall give notice of its intent to exercise such rights to the Pledgors, (i) the
Agent shall have the right to receive any and all cash dividends paid in respect
of the Pledged Stock and make application thereof to the Obligations in such
order as the Agent may determine, and (ii) all shares of the Pledged Stock shall
be registered in the name of the Agent or its nominee, and the Agent or its
nominee may thereafter exercise (A) all voting, corporate and other rights
pertaining to
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such shares of the Pledged Stock at any meeting of shareholders of the Issuer or
otherwise and (B) any and all rights of conversion, exchange, subscription and
any other rights, privileges or options pertaining to such shares of the Pledged
Stock as if it were the absolute owner thereof (including, without limitation,
the right to exchange at its discretion any and all of the Pledged Stock upon
the merger, consolidation, reorganization, recapitalization or other fundamental
change in the corporate structure of the Issuer, or upon the exercise by the
Pledgors or the Agent of any right, privilege or option pertaining to such
shares of the Pledged Stock, and in connection therewith, the right to deposit
and deliver any and all of the Pledged Stock with any committee, depositary,
transfer agent, registrar or other designated agency upon such terms and
conditions as the Agent may determine), all without liability except to account
for property actually received by it, but the Agent shall have no duty to the
Pledgors to exercise any such right, privilege or option and shall not be
responsible for any failure to do so or delay in so doing.
8. Remedies. (a) If an Event of Default shall have occurred and be
continuing, at any time at the Agent's election, the Agent may apply all or any
part of Proceeds held in any Collateral Account in payment of the Obligations in
such order as the Agent may elect.
(b) If an Event of Default shall have occurred and be continuing, the
Agent, on behalf of the Lenders, may exercise, in addition to all other rights
and remedies granted in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Obligations, all rights and remedies of
a secured party under the Code. Without limiting the generality of the
foregoing, the Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon the Pledgors or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
assign, give option or options to purchase or otherwise dispose of and deliver
the Collateral or any part thereof (or contract to do any of the foregoing), in
one or more parcels at public or private sale or sales, in the over-the-counter
market, at any exchange, broker's board or office of the Agent or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Agent or any Lender shall have the right upon
any such public sale or sales, and, to the extent permitted by law, upon any
such private sale or sales, to purchase the whole or any part of the Collateral
so sold, free of any right or equity of redemption in the Pledgors, which right
or equity is hereby waived or released. The Agent shall apply any Proceeds from
time to time held by it and the net proceeds of any such collection, recovery,
receipt, appropriation, realization or sale, after deducting all reasonable
costs and expenses of every kind incurred in respect thereof or incidental to
the care or safekeeping of any of the Collateral or in any way relating to the
Collateral or the rights of the Agent and the Lenders hereunder, including,
without limitation, reasonable attorneys' fees and disbursements of counsel to
the Agent, to the payment in whole or in part of the Obligations, in such order
as the Agent may elect, and only after such application and after the payment by
the Agent of any other amount required by any provision of law, including,
without limitation, Section 9-504(1)(c) of the Code, need the Agent account for
the surplus, if any, to the Pledgors. To the extent permitted by
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applicable law, the Pledgors waive all claims, damages and demands they may
acquire against the Agent or any Lender arising out of the exercise by them of
any rights hereunder. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least 10 days before such sale or other disposition. The
Pledgors shall remain liable for any deficiency if the proceeds of any sale or
other disposition of Collateral are insufficient to pay the Obligations and the
fees and disbursements of any attorneys employed by the Agent or any Lender to
collect such deficiency.
(c) The Pledgors waive and agree not to assert any rights or privileges
which they may acquire solely under Section 9-112 of the Code. The Pledgors
shall remain liable for any deficiency if the proceeds of any sale or other
disposition of Collateral are insufficient to pay the Secured Obligations and
the fees and disbursements of any attorneys employed by the Agent or any Lender
to collect such deficiency.
9. Registration Rights; Private Sales. (a) The Pledgors agree to cause
the Issuer to comply with the provisions of the securities or "Blue Sky" laws of
any and all jurisdictions which the Agent shall designate and to make available
to its security holders, as soon as practicable, an earnings statement (which
need not be audited) which will satisfy the provisions of Section 11(a) of the
Securities Act.
(b) The Pledgors recognize that the Agent may be unable to effect a
public sale of any or all the Pledged Stock, by reason of certain prohibitions
contained in the Securities Act and applicable state securities laws or
otherwise, and may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers which will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof. The Pledgors acknowledge and
agree that any such private sale may result in prices and other terms less
favorable than if such sale were a public sale and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner. The Agent shall be under no obligation
to delay a sale of any of the Pledged Stock for the period of time necessary to
permit the Issuer thereof to register such securities for public sale under the
Securities Act, or under applicable state securities laws, even if the Issuer
would agree to do so.
(c) The Pledgors further agree to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales of
all or any portion of the Pledged Stock pursuant to this Section valid and
binding and in compliance with any and all other applicable Requirements of Law.
The Pledgors further agree that a breach of any of the covenants contained in
this Section will cause irreparable injury to the Agent and the Lenders, that
the Agent and the Lenders have no adequate remedy at law in respect of such
breach and, as a consequence, that each and every covenant contained in this
Section shall be specifically enforceable against the Pledgors, and the Pledgors
hereby waive and agree not to assert any defenses against an action for specific
performance of such covenants except for a defense that no Event of Default has
occurred under the Credit Agreement.
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10. Irrevocable Authorization and Instruction to Issuer. The Pledgors
hereby authorize and instruct the Issuer to comply with any instruction received
by it from the Agent in writing that (a) states that an Event of Default has
occurred and (b) is otherwise in accordance with the terms of this Agreement,
without any other or further instructions from the Pledgors, and the Pledgors
agree that the Issuer shall be fully protected in so complying.
11. Agent's Appointment as Attorney-in-Fact. (a) The Pledgors hereby
irrevocably constitute and appoint the Agent and any officer or agent of the
Agent, with full power of substitution, as their true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of the Pledgors and in the name of the Pledgors or in the Agent's own
name, from time to time in the Agent's discretion, for the purpose of carrying
out the terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, including, without
limitation, any financing statements, endorsements, assignments or other
instruments of transfer.
(b) The Pledgors hereby ratify all that said attorneys shall lawfully
do or cause to be done pursuant to the power of attorney granted in subsection
11(a). All powers, authorizations and agencies contained in this Agreement are
coupled with an interest and are irrevocable until this Agreement is terminated
and the security interests created hereby are released.
12. Duty of Agent. The Agent's sole duty with respect to the custody,
safekeeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the Code or otherwise, shall be to deal with it in the same
manner as the Agent deals with similar securities and property for its own
account, except that the Agent shall have no obligation to invest funds held in
any Collateral Account and may hold the same as demand deposits. Neither the
Agent, any Lender nor any of their respective directors, officers, employees or
agents shall be liable for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise dispose of any Collateral upon the request of the Pledgors or any
other Person or to take any other action whatsoever with regard to the
Collateral or any part thereof.
13. Execution of Financing Statements. Pursuant to Section 9-402 of the
Code, the Pledgors authorize the Agent to file financing statements with respect
to the Collateral without the signature of the Pledgors in such form and in such
filing offices as the Agent reasonably determines appropriate to perfect the
security interests of the Agent under this Agreement. A carbon, photographic or
other reproduction of this Agreement shall be sufficient as a financing
statement for filing in any jurisdiction.
14. Authority of Agent. The Pledgors acknowledge that the rights and
responsibilities of the Agent under this Agreement with respect to any action
taken by the Agent or the exercise or non-exercise by the Agent of any option,
voting right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the Agent and the
Lenders, be governed by the Credit Agreement and by such other agreements with
respect thereto as may exist from time to time among them, but, as between
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the Agent and the Pledgors, the Agent shall be conclusively presumed to be
acting as agent for the Lenders with full and valid authority so to act or
refrain from acting, and neither the Pledgors nor the Issuer shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.
15. Notices. All notices, requests and demands to or upon the Agent or
the Pledgors to be effective shall be in writing (or by telex, fax or similar
electronic transfer confirmed in writing) and shall be deemed to have been duly
given or made (i) when delivered by hand or (ii) if given by mail, when
deposited in the mails by certified mail, return receipt requested, or (iii) if
by telex, fax or similar electronic transfer, when sent and receipt has been
confirmed, addressed to the Agent or the Pledgors at their address or
transmission number for notices provided on the signature page hereto. The Agent
and the Pledgors may change their addresses and transmission numbers for notices
by notice in the manner provided in this Section.
16. Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
17. Return of Documents; Cooperation. When this Agreement is terminated
and the security interests created hereby are released, the Agent shall (i)
execute and deliver to the Pledgors such documents of assignment as are
reasonably necessary to terminate the Agent's security interest in the
Collateral and (ii) return to the Pledgors the documents delivered to the Agent
as provided in Section 3. If any part of the Collateral is released in
connection with any disposition thereof expressly permitted under the terms of
the Credit Agreement, and the corresponding security interests created hereby
are released, the Agent shall take the actions under clauses (i) and (ii) as
appropriate, with respect to such release.
18. Amendments in Writing; No Waiver; Cumulative Remedies. (a) None of
the terms or provisions of this Agreement may be waived, amended, supplemented
or otherwise modified except by a written instrument executed by the Pledgors
and the Agent, provided that any provision of this Agreement may be waived by
the Agent and the Lenders in a letter or agreement executed by the Agent or by
telex or facsimile transmission from the Agent.
(b) Neither the Agent nor any Lender shall by any act (except by a
written instrument pursuant to subsection 18(a) hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default or in any breach of any of
the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
A waiver by the Agent or any Lender of any right or remedy hereunder on any one
occasion shall not be construed as a bar to any right or remedy which the Agent
or such Lender would otherwise have on any future occasion.
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(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
19. Section Headings. The section headings used in this Agreement are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.
20. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Pledgors and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
21. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
22. Guarantee. (a) Subject to the provisions of paragraph 22(b) below,
the Pledgors hereby unconditionally and irrevocably guarantee to the Agent, for
the ratable benefit of the Lenders and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by the
Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Obligations.
(b) The Pledgors shall have no personal liability for payment of the
Obligations, and in any action or suit to collect the Obligations the Agent and
the Lenders, for themselves and their respective successors, indorsees,
transferees and assigns, agree that under no circumstances shall any of them
seek, nor shall the Pledgors be subject to, any in personam judgment against the
Pledgors or any judgment for a deficiency but shall look solely to the security
interests hereunder and the collateral described herein for payment of the
Obligations. Nothing contained in this Section shall be construed to impair the
validity of the Obligations or this Agreement or, except as expressly set forth
above, affect or impair in any way the right of the Agent and the Lenders to
exercise their rights and remedies under the Credit Agreement, the Notes and any
other Loan Documents in accordance with their terms.
23. Regulatory Approval. (a) Notwithstanding anything herein to the
contrary, to the extent this Agreement or any other Loan Document purports to
require any Loan Party to grant to the Agent, on behalf of Lenders, a security
interest in the FCC Licenses of any Loan Party now owned or hereafter acquired,
as the case may be, the Agent, on behalf of Lenders, shall only have a security
interest in such FCC Licenses at such times and to the extent that a security
interest in such licenses is permitted under applicable law. Notwithstanding
anything to the contrary set forth herein, the Agent, on behalf of Lenders,
agrees that to the extent prior FCC approval is required pursuant to the
Communications Act for (a) the operation and effectiveness of any grant, right
or remedy hereunder or under the Security Agreements or (b) taking any action
that may be taken by the Agent hereunder or under the Security Agreements, such
grant, right, remedy or actions will be subject to such prior FCC approval
having been obtained by or in favor of the Agent, on behalf of Lenders. The
Borrower agrees that, upon an Event of Default and at the Agent's request, the
Borrower will, and will cause its Subsidiaries to, immediately file, or cause to
be filed, such applications for approval
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and shall take all other and further actions reasonably required by the Agent,
on behalf of Lenders, to obtain such FCC approvals or consents as are necessary
to transfer ownership and control to the Agent, on behalf of Lenders, or their
successors, assigns or designees of the FCC Licenses held by the Borrower, its
License Subsidiaries or any of its other Subsidiaries. To enforce the provisions
of this subsection, the Agent is empowered to request the appointment of a
receiver from any court of competent jurisdiction. Such receiver shall be
instructed to seek from the FCC an involuntary transfer of control of any such
FCC License for the purpose of seeking a bona fide purchaser to whom control
will ultimately be transferred. The Borrower hereby agrees to authorize, and to
cause each of its Subsidiaries to authorize, such an involuntary transfer of
control upon the request of the receiver so appointed, and, if the Borrower
shall refuse to authorize or cause any of its Subsidiaries to so authorize the
transfer, its approval may be required by the court. Upon the occurrence and
continuance of an Event of Default, and at the request of the Agent, the
Borrower shall further use its best efforts to assist in obtaining approval of
the FCC, if required, for any action or transactions contemplated by this
Agreement or the other Loan Documents, including, without limitation, the
preparation, execution and filing with the FCC of the assignor's or transferor's
portion of any application or applications for consent to the assignment of any
FCC License or transfer of control necessary or appropriate under the FCC's
rules and regulations for approval of the transfer or assignment of any portion
of the Collateral, together with any FCC License or other authorization.
(b) The Borrower acknowledges that the assignment or transfer of such
FCC Licenses is integral to the Lenders' realization of the value of the
Collateral, that there is no adequate remedy at law for failure by the Borrower
to comply with the provisions of this Section 24 and that such failure would not
be adequately compensable in damages, and therefore agrees that the agreements
contained in this Section 24 may be specifically enforced.
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(c) Notwithstanding anything to the contrary contained in this
Agreement or any other Loan Document, neither the Agent nor any Lender shall,
without first obtaining the approval of the FCC, take any action pursuant to
this Agreement or any other Loan Document which would constitute or result in
any assignment of an FCC License or any change of control of the Borrower or any
of its Subsidiaries if such assignment or change in control would require, under
then existing law (including the written rules and regulations promulgated by
the FCC), the prior approval of the FCC.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
duly executed and delivered as of the date first above written.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
SECOND ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
LIMITED PARTNERSHIP
By: ▇▇▇▇▇▇ ENTERPRISES, INC.,
a Nevada corporation, as managing
general partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
President
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
239
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Pledge
Agreement dated July 11, 1997 made by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and Second ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Limited Partnership for the benefit of Union Bank of California, N.A.,
as Agent (the "Pledge Agreement"). The undersigned agrees for the benefit of the
Agent and the Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement
and will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Agent promptly in writing of the
occurrence of any of the events described in subsection 5(a) of the Pledge
Agreement.
3. The terms of subsection 9(c) of the Pledge Agreement shall apply to
it, mutatis mutandis, with respect to all actions that may be required of it
under or pursuant to or arising out of Section 9 of the Pledge Agreement.
▇▇▇▇▇▇ COMMUNICATIONS CORPORATION
By: /s/
-----------------------------
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
240
SCHEDULE 1
TO ▇▇▇▇▇▇
PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Stock Certificate
Issuer Class of Stock* No. No. of Shares
----------------------------------------- -------------------- ------------------------ --------------------
▇▇▇▇▇▇ Communications Common 0733 207,624
Corporation
▇▇▇▇▇▇ Communications Common PCC1097 2,000,000
Corporation
▇▇▇▇▇▇ Communications Common PCC1100 1,000,000
Corporation
▇▇▇▇▇▇ Communications Common 472,376(1)
Corporation
--------
(1) Additional pledge of 472,376 shares to be consummated post-closing. The
Agent may complete the missing information regarding "Stock Certificate No."
after such additional pledge takes place.
241
FORM OF PCUH PLEDGE AGREEMENT
PCUH PLEDGE AGREEMENT, dated as of July 11, 1997, made by
▇▇▇▇▇▇ Communications Unrestricted Holdings, Inc., a Delaware corporation (the
"Pledgor"), in favor of Union Bank of California, N.A., as Agent (in such
capacity, the "Agent") for the Lenders parties to the Credit Agreement, dated as
of July 11, 1997, (as amended, supplemented or otherwise modified from time to
time, the "Credit Agreement"), among Travel Channel Acquisition Corporation (the
"Borrower"), the Agent and such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein;
WHEREAS, the Pledgor is the legal and beneficial owner of the shares of
Pledged Stock (as hereinafter defined) issued by the Issuers (as hereinafter
defined); and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
the Pledgor shall have executed and delivered this Pledge Agreement to the Agent
for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce
the Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans under the Credit Agreement, the Pledgor
hereby agrees with the Agent, for the ratable benefit of the Lenders, as
follows:
1. Defined Terms. (a) Unless otherwise defined herein, terms defined in
the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement.
(b) The following terms shall have the following meanings:
"Agreement": this Pledge Agreement, as the same may be amended,
modified or otherwise supplemented from time to time.
"Code": the Uniform Commercial Code from time to time in effect in the
State of New York.
"Collateral": the Pledged Stock and all Proceeds.
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"Collateral Account": any account established to hold money Proceeds,
maintained under the sole dominion and control of the Agent, subject to
withdrawal by the Agent for the account of the Lenders only as provided in
subsection 8(a).
"Issuers": the collective reference to the companies identified on
Schedule 1 attached hereto as the issuers of the Pledged Stock; individually,
each an "Issuer."
"Pledged Stock": the shares of capital stock listed on Schedule 1
hereto, together with all stock certificates, options or rights of any nature
whatsoever that may be issued or granted by any Issuer to the Pledgor in respect
of the Pledged Stock while this Agreement is in effect.
"Proceeds": all "proceeds" as such term is defined in Section 9-306(1)
of the Uniform Commercial Code in effect in the State of New York on the date
hereof and, in any event, shall include, without limitation, all dividends or
other income from the Pledged Stock, collections thereon or distributions with
respect thereto.
"Secured Obligations": the collective reference to (a) the Obligations
and (b) all obligations and liabilities of the Pledgor which may arise under or
in connection with this Agreement or any other Loan Document to which the
Pledgor is a party, whether on account of reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
fees and disbursements of counsel to the Agent or to the Lenders that are
required to be paid by the Pledgor pursuant to the terms of this Agreement or
any other Loan Document to which the Pledgor is a party).
"Securities Act": the Securities Act of 1933, as amended.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section and paragraph
references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Pledge; Grant of Security Interest. The Pledgor hereby delivers to
the Agent, for the ratable benefit of the Lenders, all the Pledged Stock and
hereby grants to Agent, for the ratable benefit of the Lenders, a first security
interest in the Collateral, as collateral security for the prompt and complete
payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of the Obligations.
3. Stock Powers. (a) Concurrently with the delivery to the Agent of
each certificate representing one or more shares of Pledged Stock to the Agent,
the Pledgor shall deliver an undated stock power covering such certificate, duly
executed in blank by the Pledgor with, if the Agent so requests, signature
guaranteed.
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(b) The Pledgor shall deliver to the Agent an Acknowledgement and
Consent, substantially in the form of Exhibit A to this Agreement, duly executed
by the Issuer of such Pledged Stock.
4. Representations and Warranties. The Pledgor represents and warrants
that:
(a) The shares of Pledged Stock constitute all the issued and
outstanding shares of all classes of the capital stock of each Issuer.
(b) All the shares of the Pledged Stock have been duly and validly
issued and are fully paid and nonassessable.
(c) The Pledgor is the record and beneficial owner of, and has good and
marketable title to, the Pledged Stock, free of any and all Liens or options in
favor of, or claims of, any other Person, except the security interest created
by this Agreement.
(d) Upon delivery to the Agent of the stock certificates evidencing the
Pledged Stock, the security interest created pursuant to this Agreement will
constitute a valid, perfected first priority security interest in the
Collateral, enforceable in accordance with its terms against all creditors of
the Pledgor and any Persons purporting to purchase any Collateral from the
Pledgor, except in each case as enforceability may be affected by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
(e) The Pledgor has obtained from each Issuer and has delivered to the
Agent an Acknowledgement and Consent, substantially in the form attached hereto
as Exhibit A, executed by each such Issuer.
(f) The Pledgor is 100% owned by PCC.
5. Covenants. The Pledgor covenants and agrees with the Agent and the
Lenders that, from and after the date of this Agreement until this Agreement is
terminated and the security interests created hereby are released:
(a) If the Pledgor shall, as a result of its ownership of the Pledged
Stock, become entitled to receive or shall receive any stock certificate
(including, without limitation, any certificate representing a stock dividend or
a distribution in connection with any reclassification, increase or reduction of
capital or any certificate issued in connection with any reorganization), option
or rights, whether in addition to, in substitution of, as a conversion of, or in
exchange for any shares of the Pledged Stock, or otherwise in respect thereof,
the Pledgor shall accept the same as the agent of the Agent and the Lenders,
hold the same in trust for the Agent and the Lenders and deliver the same
forthwith to the Agent in the exact form received, duly indorsed by the Pledgor
to the Agent, if required, together with an
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undated stock power covering such certificate duly executed in blank by the
Pledgor and with, if the Agent so requests, signature guaranteed, to be held by
the Agent, subject to the terms hereof, as additional collateral security for
the Obligations. Any sums paid upon or in respect of the Pledged Stock upon the
liquidation or dissolution of any Issuer shall be paid over to the Agent to be
held by it hereunder as additional collateral security for the Obligations, and
in case any distribution of capital shall be made on or in respect of the
Pledged Stock or any property shall be distributed upon or with respect to the
Pledged Stock pursuant to the recapitalization or reclassification of the
capital of any Issuer or pursuant to the reorganization thereof, the property so
distributed shall be delivered to the Agent to be held by it hereunder as
additional collateral security for the Obligations. If any sums of money or
property so paid or distributed in respect of the Pledged Stock shall be
received by the Pledgor, the Pledgor shall, until such money or property is paid
or delivered to the Agent, hold such money or property in trust for the Lenders,
segregated from other funds of the Pledgor, as additional collateral security
for the Obligations.
(b) Without the prior written consent of the Agent (or except as
expressly permitted under the terms of the Credit Agreement), the Pledgor will
not (i) vote to enable, or take any other action to permit, any Issuer to issue
any stock or other equity securities of any nature or to issue any other
securities convertible into or granting the right to purchase or exchange for
any stock or other equity securities of any nature of any Issuer, (ii) sell,
assign, transfer, exchange, or otherwise dispose of, or grant any option with
respect to, the Collateral, (iii) create, incur or permit to exist any Lien or
option in favor of, or any claim of any Person with respect to, any of the
Collateral, or any interest therein, except for the security interests created
by this Agreement or (iv) enter into any agreement or undertaking restricting
the right or ability of the Pledgor or the Agent to sell, assign or transfer any
of the Collateral.
(c) The Pledgor shall maintain the security interest created by this
Agreement as a first, perfected security interest and shall defend such security
interest against claims and demands of all Persons other than the Agent. At any
time and from time to time, upon the written request of the Agent, and at the
sole expense of the Pledgor, the Pledgor will promptly and duly execute and
deliver such further instruments and documents and take such further actions as
the Agent may reasonably request for the purposes of obtaining or preserving the
full benefits of this Agreement and of the rights and powers herein granted. If
any amount payable under or in connection with any of the Collateral shall be or
become evidenced by any promissory note, other instrument or chattel paper, such
note, instrument or chattel paper shall be immediately delivered to the Agent,
duly endorsed if necessary in a manner satisfactory to the Agent, to be held as
Collateral pursuant to this Agreement.
(d) The Pledgor shall pay, and save the Agent and the Lenders harmless
from, any and all liabilities with respect to, or resulting from any delay in
paying, any and all stamp, excise, sales or other taxes and any and all
recording and filing fees which may be payable or determined to be payable with
respect to any of the Collateral or in connection with any of the transactions
contemplated by this Agreement.
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(e) The Pledgor will not take or omit to take any action, the taking or
the omission of which would result in an alteration or impairment of the
Collateral or the security of this Agreement, except as otherwise expressly
permitted under the terms of the Credit Agreement.
(f) The Pledgor will not enter into any agreement amending or
supplementing the Collateral, except as otherwise expressly permitted under the
terms of the Credit Agreement.
(g) The Pledgor will not waive or release any obligation of any party
to the Collateral, except as otherwise expressly permitted under the terms of
the Credit Agreement.
(h) Unless directed otherwise by the Agent, the Pledgor will exercise
promptly and diligently each and every material right which it may have under
the Collateral (except the right to release or cancel).
(i) The Pledgor will not take or omit to take any action or 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 Collateral.
(j) Upon the occurrence and continuance of an Event of Default, the
Pledgor will give the Agent copies of all material notices (including notices of
default) given or received with respect to the Collateral, promptly after giving
or receiving such notices.
6. Cash Dividends; Voting Rights. Unless an Event of Default shall have
occurred and be continuing and the Agent shall have given notice to the Pledgor
of the Agent's intent to exercise its corresponding rights pursuant to Section 7
below, the Pledgor shall be permitted to receive all cash dividends paid in the
normal course of business of the Issuers and consistent with past practice, to
the extent permitted in the Credit Agreement, in respect of the Pledged Stock
and to exercise all voting and corporate rights with respect to the Pledged
Stock; provided, however, that no vote shall be cast or corporate right
exercised or other action taken which, in the Agent's reasonable judgment, would
impair the Collateral or which would be inconsistent with or result in any
violation of any provision of the Credit Agreement, the Notes, this Agreement or
any other Loan Document.
7. Rights of the Lenders and the Agent. (a) All money Proceeds received
by the Agent hereunder shall be held by the Agent for the benefit of the Lenders
in a Collateral Account. All Proceeds while held by the Agent in a Collateral
Account (or by the Pledgor in trust for the Agent and the Lenders) shall
continue to be held as collateral security for all the Obligations and shall not
constitute payment thereof until applied as provided in subsection 8(a).
(b) If an Event of Default shall occur and be continuing and the Agent
shall give notice of its intent to exercise such rights to the Pledgor, (i) the
Agent shall have the right to receive any and all cash dividends paid in respect
of the Pledged Stock and make application thereof to the Obligations in such
order as the Agent may determine, and (ii) all shares of the
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Pledged Stock shall be registered in the name of the Agent or its nominee, and
the Agent or its nominee may thereafter exercise (A) all voting, corporate and
other rights pertaining to such shares of the Pledged Stock at any meeting of
shareholders of any Issuer or otherwise and (B) any and all rights of
conversion, exchange, subscription and any other rights, privileges or options
pertaining to such shares of the Pledged Stock as if it were the absolute owner
thereof (including, without limitation, the right to exchange at its discretion
any and all of the Pledged Stock upon the merger, consolidation, reorganization,
recapitalization or other fundamental change in the corporate structure of any
Issuer, or upon the exercise by the Pledgor or the Agent of any right, privilege
or option pertaining to such shares of the Pledged Stock, and in connection
therewith, the right to deposit and deliver any and all of the Pledged Stock
with any committee, depositary, transfer agent, registrar or other designated
agency upon such terms and conditions as the Agent may determine), all without
liability except to account for property actually received by it, but the Agent
shall have no duty to the Pledgor to exercise any such right, privilege or
option and shall not be responsible for any failure to do so or delay in so
doing.
8. Remedies. (a) If an Event of Default shall have occurred and be
continuing, at any time at the Agent's election, the Agent may apply all or any
part of Proceeds held in any Collateral Account in payment of the Obligations in
such order as the Agent may elect.
(b) If an Event of Default shall have occurred and be continuing, the
Agent, on behalf of the Lenders, may exercise, in addition to all other rights
and remedies granted in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Obligations, all rights and remedies of
a secured party under the Code. Without limiting the generality of the
foregoing, the Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon the Pledgor or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
assign, give option or options to purchase or otherwise dispose of and deliver
the Collateral or any part thereof (or contract to do any of the foregoing), in
one or more parcels at public or private sale or sales, in the over-the-counter
market, at any exchange, broker's board or office of the Agent or any Lender or
elsewhere upon such terms and conditions as it may deem advisable and at such
prices as it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk. The Agent or any Lender shall have the right upon
any such public sale or sales, and, to the extent permitted by law, upon any
such private sale or sales, to purchase the whole or any part of the Collateral
so sold, free of any right or equity of redemption in the Pledgor, which right
or equity is hereby waived or released. The Agent shall apply any Proceeds from
time to time held by it and the net proceeds of any such collection, recovery,
receipt, appropriation, realization or sale, after deducting all reasonable
costs and expenses of every kind incurred in respect thereof or incidental to
the care or safekeeping of any of the Collateral or in any way relating to the
Collateral or the rights of the Agent and the Lenders hereunder, including,
without limitation, reasonable attorneys' fees and disbursements of counsel to
the Agent, to the
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payment in whole or in part of the Obligations, in such order as the Agent may
elect, and only after such application and after the payment by the Agent of any
other amount required by any provision of law, including, without limitation,
Section 9-504(1)(c) of the Code, need the Agent account for the surplus, if any,
to the Pledgor. To the extent permitted by applicable law, the Pledgor waives
all claims, damages and demands it may acquire against the Agent or any Lender
arising out of the exercise by them of any rights hereunder. If any notice of a
proposed sale or other disposition of Collateral shall be required by law, such
notice shall be deemed reasonable and proper if given at least 10 days before
such sale or other disposition. The Pledgor shall remain liable for any
deficiency if the proceeds of any sale or other disposition of Collateral are
insufficient to pay the Obligations and the fees and disbursements of any
attorneys employed by the Agent or any Lender to collect such deficiency.
(c) The Pledgor waives and agrees not to assert any rights or
privileges which it may acquire solely under Section 9-112 of the Code. The
Pledgor shall remain liable for any deficiency if the proceeds of any sale or
other disposition of Collateral are insufficient to pay the Secured Obligations
and the fees and disbursements of any attorneys employed by the Agent or any
Lender to collect such deficiency.
9. Registration Rights; Private Sales. (a) If the Agent shall determine
to exercise its right to sell any or all of the Pledged Stock pursuant to
Section 8(b) hereof, and if in the opinion of the Agent it is necessary or
advisable to have the Pledged Stock, or that portion thereof to be sold,
registered under the provisions of the Securities Act, the Pledgor will cause
the Issuer thereof to (i) execute and deliver, and cause the directors and
officers of such Issuer to execute and deliver, all such instruments and
documents, and do or cause to be done all such other acts as may be, in the
opinion of the Agent, necessary or advisable to register the Pledged Stock, or
that portion thereof to be sold, under the provisions of the Securities Act,
(ii) to use its best efforts to cause the registration statement relating
thereto to become effective and to remain effective for a period of one year
from the date of the first public offering of the Pledged Stock, or that portion
thereof to be sold, and (iii) to make all amendments thereto and/or to the
related prospectus which, in the opinion of the Agent, are necessary or
advisable, all in conformity with the requirements of the Securities Act and the
rules and regulations of the Securities and Exchange Commission applicable
thereto. The Pledgor agrees to cause such Issuer to comply with the provisions
of the securities or "Blue Sky" laws of any and all jurisdictions which the
Agent shall designate and to make available to its security holders, as soon as
practicable, an earnings statement (which need not be audited) which will
satisfy the provisions of Section 11(a) of the Securities Act.
(b) The Pledgor recognizes that the Agent may be unable to effect a
public sale of any or all the Pledged Stock, by reason of certain prohibitions
contained in the Securities Act and applicable state securities laws or
otherwise, and may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers which will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof. The Pledgor acknowledges and
agrees that
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any such private sale may result in prices and other terms less favorable than
if such sale were a public sale and, notwithstanding such circumstances, agrees
that any such private sale shall be deemed to have been made in a commercially
reasonable manner. The Agent shall be under no obligation to delay a sale of any
of the Pledged Stock for the period of time necessary to permit the Issuer
thereof to register such securities for public sale under the Securities Act, or
under applicable state securities laws, even if such Issuer would agree to do
so.
(c) The Pledgor further agrees to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales of
all or any portion of the Pledged Stock pursuant to this Section valid and
binding and in compliance with any and all other applicable Requirements of Law.
The Pledgor further agrees that a breach of any of the covenants contained in
this Section will cause irreparable injury to the Agent and the Lenders, that
the Agent and the Lenders have no adequate remedy at law in respect of such
breach and, as a consequence, that each and every covenant contained in this
Section shall be specifically enforceable against the Pledgor, and the Pledgor
hereby waives and agrees not to assert any defenses against an action for
specific performance of such covenants except for a defense that no Event of
Default has occurred under the Credit Agreement.
10. Irrevocable Authorization and Instruction to Issuer. The Pledgor
hereby authorizes and instructs each Issuer to comply with any instruction
received by it from the Agent in writing that (a) states that an Event of
Default has occurred and (b) is otherwise in accordance with the terms of this
Agreement, without any other or further instructions from the Pledgor, and the
Pledgor agrees that each Issuer shall be fully protected in so complying.
11. Agent's Appointment as Attorney-in-Fact. (a) The Pledgor hereby
irrevocably constitutes and appoints the Agent and any officer or agent of the
Agent, with full power of substitution, as its true and lawful attorney-in-fact
with full irrevocable power and authority in the place and stead of the Pledgor
and in the name of the Pledgor or in the Agent's own name, from time to time in
the Agent's discretion, for the purpose of carrying out the terms of this
Agreement, to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this Agreement, including, without limitation, any financing
statements, endorsements, assignments or other instruments of transfer.
(b) The Pledgor hereby ratifies all that said attorneys shall lawfully
do or cause to be done pursuant to the power of attorney granted in subsection
11(a). All powers, authorizations and agencies contained in this Agreement are
coupled with an interest and are irrevocable until this Agreement is terminated
and the security interests created hereby are released.
12. Duty of Agent. The Agent's sole duty with respect to the custody,
safekeeping and physical preservation of the Collateral in its possession, under
Section 9-207 of the Code or otherwise, shall be to deal with it in the same
manner as the Agent deals with similar
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securities and property for its own account, except that the Agent shall have no
obligation to invest funds held in any Collateral Account and may hold the same
as demand deposits. Neither the Agent, any Lender nor any of their respective
directors, officers, employees or agents shall be liable for failure to demand,
collect or realize upon any of the Collateral or for any delay in doing so or
shall be under any obligation to sell or otherwise dispose of any Collateral
upon the request of the Pledgor or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof.
13. Execution of Financing Statements. Pursuant to Section 9-402 of the
Code, the Pledgor authorizes the Agent to file financing statements with respect
to the Collateral without the signature of the Pledgor in such form and in such
filing offices as the Agent reasonably determines appropriate to perfect the
security interests of the Agent under this Agreement. A carbon, photographic or
other reproduction of this Agreement shall be sufficient as a financing
statement for filing in any jurisdiction.
14. Authority of Agent. The Pledgor acknowledges that the rights and
responsibilities of the Agent under this Agreement with respect to any action
taken by the Agent or the exercise or non-exercise by the Agent of any option,
voting right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the Agent and the
Lenders, be governed by the Credit Agreement and by such other agreements with
respect thereto as may exist from time to time among them, but, as between the
Agent and the Pledgor, the Agent shall be conclusively presumed to be acting as
agent for the Lenders with full and valid authority so to act or refrain from
acting, and neither the Pledgor nor any Issuer shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.
15. Notices. All notices, requests and demands to or upon the Agent or
the Pledgor to be effective shall be in writing (or by telex, fax or similar
electronic transfer confirmed in writing) and shall be deemed to have been duly
given or made (i) when delivered by hand or (ii) if given by mail, when
deposited in the mails by certified mail, return receipt requested, or (iii) if
by telex, fax or similar electronic transfer, when sent and receipt has been
confirmed, addressed to the Agent or the Pledgor at its address or transmission
number for notices provided on the signature page hereto. The Agent and the
Pledgor may change their addresses and transmission numbers for notices by
notice in the manner provided in this Section.
16. Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
17. Return of Documents; Cooperation. (a) When this Agreement is
terminated and the security interests created hereby are released, the Agent
shall (i) execute and deliver to the
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Pledgor such documents of assignment as are reasonably necessary to terminate
the Agent's security interest in the Collateral and (ii) return to the Pledgor
the documents delivered to the Agent as provided in Section 3. If any part of
the Collateral is released in connection with any disposition thereof expressly
permitted under the terms of the Credit Agreement, and the corresponding
security interests created hereby are released, the Agent shall take the actions
under clauses (i) and (ii) as appropriate, with respect to such release.
18. Amendments in Writing; No Waiver; Cumulative Remedies. (a) None of
the terms or provisions of this Agreement may be waived, amended, supplemented
or otherwise modified except by a written instrument executed by the Pledgor and
the Agent, provided that any provision of this Agreement may be waived by the
Agent and the Lenders in a letter or agreement executed by the Agent or by telex
or facsimile transmission from the Agent.
(b) Neither the Agent nor any Lender shall by any act (except by a
written instrument pursuant to subsection 18(a) hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any Default or Event of Default or in any breach of any of
the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
A waiver by the Agent or any Lender of any right or remedy hereunder on any one
occasion shall not be construed as a bar to any right or remedy which the Agent
or such Lender would otherwise have on any future occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
19. Section Headings. The section headings used in this Agreement are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.
20. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Pledgor and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
21. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
22. Guarantee. (a) Subject to the provisions of paragraph 22(b) below,
the Pledgor hereby unconditionally and irrevocably guarantees to the Agent, for
the ratable benefit of the Lenders and their respective successors, indorsees,
transferees and assigns, the prompt and complete payment and performance by the
Borrower when due (whether at the stated maturity, by acceleration or otherwise)
of the Obligations.
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(b) The Pledgor shall have no personal liability for payment of the
Obligations, and in any action or suit to collect the Obligations the Agent and
the Lenders shall not seek any in personam judgment against the Pledgor or any
judgment for a deficiency but shall look solely to the security interests
hereunder and the collateral described herein for payment of the Obligations.
Nothing contained in this Section shall be construed to impair the validity of
the Obligations or this Agreement or affect or impair in any way the right of
the Agent and the Lenders to exercise their rights and remedies under the Credit
Agreement, the Notes and any other Loan Documents in accordance with their
terms.
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
duly executed and delivered as of the date first above written.
▇▇▇▇▇▇ COMMUNICATIONS
UNRESTRICTED HOLDINGS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
253
ACKNOWLEDGEMENT AND CONSENT
The undersigned hereby acknowledges receipt of a copy of the Pledge
Agreement dated July 11, 1997 made by ▇▇▇▇▇▇ Communications Unrestricted
Holdings, Inc. for the benefit of Union Bank of California, N.A., as Agent (the
"Pledge Agreement"). The undersigned agrees for the benefit of the Agent and the
Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement
and will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Agent promptly in writing of the
occurrence of any of the events described in subsection 5(a) of the Pledge
Agreement.
3. The terms of subsection 9(c) of the Pledge Agreement shall apply to
it, mutatis mutandis, with respect to all actions that may be required of it
under or pursuant to or arising out of Section 9 of the Pledge Agreement.
TRAVEL CHANNEL ACQUISITION CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
254
SCHEDULE 1
TO PCUH
PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Stock Certificate
Issuer Class of Stock* No. No. of Shares
----------------------------------------- --------------- ------------------ -------------
Travel Channel Common ($.01 2 1,000
Acquisition Corporation par value)
------------------------------------
*Stock is assumed to be common stock unless otherwise indicated.
255
BORROWER SECURITY AGREEMENT
BORROWER SECURITY AGREEMENT, dated as of July 11, 1997, made by Travel
Channel Acquisition Corporation, a Delaware corporation, (the "Borrower") in
favor of Union Bank of California, N.A., as Agent (in such capacity, the
"Agent") for the Lenders parties to the Credit Agreement, dated as of July 11,
1997, (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among the Borrower, the Agent and such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to the Borrower upon the terms and subject to the
conditions set forth therein; and
WHEREAS, it is a condition precedent to the obligation of the Lenders
to make their respective Loans to the Borrower under the Credit Agreement that
the Borrower shall have executed and delivered this Security Agreement to the
Agent for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce the
Agent and the Lenders to enter into the Credit Agreement and to induce the
Lenders to make their respective Loans to the Borrower, the Borrower hereby
agrees with the Agent, for the ratable benefit of the Lenders, as follows:
1. Defined Terms.
1.1 Definitions. (a) Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the meanings given
to them in the Credit Agreement, and the following terms which are defined in
the Uniform Commercial Code in effect in the State of New York on the date
hereof are used herein as so defined: Accounts, Chattel Paper, Documents,
Equipment, Farm Products, General Intangibles, Instruments, Inventory and
Proceeds.
(b) The following terms shall have the following meanings:
"Agreement": this Security Agreement, as the same may be
amended, supplemented or otherwise modified from time to time.
"Code": the Uniform Commercial Code as from time to time in
effect in the State of New York.
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"Collateral": as defined in Section 2.
"Collateral Account": any collateral account established by
the Agent as provided in subsection 5.3 or subsection 9.2.
"Contracts": all contracts, agreements, instruments and
indentures in any form, and portions thereof, to which the Borrower is
a party or under which the Borrower has any right, title or interest
or to which the Borrower or any property of the Borrower is subject,
as the same may from time to time be amended, supplemented or
otherwise modified, including, without limitation, (a) all rights of
the Borrower to receive moneys due and to become due to it thereunder
or in connection therewith, (b) all rights of the Borrower to damages
arising out of, or for, breach or default in respect thereof and (c)
all rights of the Borrower to perform and to exercise all remedies
thereunder, except, in each case to the extent the grant by the
Borrower of a security interest pursuant to this Agreement in its
right, title and interest in such contract, agreement, instrument or
indenture (i) is prohibited by such contract, agreement, instrument or
indenture without the consent of any other party thereto, (ii) would
give any other party to such contract, agreement, instrument or
indenture the right to terminate its obligations thereunder, or (iii)
is permitted with consent if all necessary consents to such grant of a
security interest have not been obtained from the other parties
thereto (it being understood that the foregoing shall not be deemed to
obligate the Borrower to obtain such consents) (the contracts,
agreements, instruments or indentures referred to in clauses (i), (ii)
and (iii) which, if terminated could reasonably be expected to result
in a Material Adverse Effect, are specified on Schedule 1 attached
hereto); provided, that the foregoing limitation shall not affect,
limit, restrict or impair the grant by the Borrower of a security
interest pursuant to this Agreement in any Account or any money or
other amounts due or to become due under any such contract, agreement,
instrument or indenture.
"Patents": (a) all letters patent of the United States or any
other country and all reissues and extensions thereof, including,
without limitation, any thereof referred to in Schedule 2, and (b) all
applications for letters patent of the United States or any other
country and all divisions, continuations and continuations-in-part
thereof, including, without limitation, any thereof referred to in
Schedule 2.
"Patent License": all agreements, whether written or oral,
providing for the grant by or to the Borrower of any right to
manufacture, use or sell any invention covered by a Patent, including,
without limitation, any thereof referred to in Schedule 2.
"Receivable": any right to payment for goods sold or leased
or for services rendered, whether or not such right is evidenced by an
Instrument or Chattel Paper and whether or not it has been earned by
performance (including, without limitation, any Account).
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"Trademarks": (a) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade
styles, service marks, logos and other source or business identifiers,
and the goodwill associated therewith, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
applications in connection therewith, whether in the United States
Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof or any other country or any political
subdivision thereof, or otherwise, including, without limitation, any
thereof referred to in Schedule 3, and (b) all renewals thereof.
"Trademark License" means any agreement, written or oral,
providing for the grant by or to the Borrower of any right to use any
Trademark, including, without limitation, any thereof referred to in
Schedule 3.
"Vehicles" means all cars, trucks, trailers, construction and
earth moving equipment and other vehicles covered by a certificate of
title law of any state.
1.2 Other Definitional Provisions. (a) The words "hereof,"
"herein", "hereto" and "hereunder" and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement, and Section, subsection and Schedule
references are to this Agreement unless otherwise specified.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Grant of Security Interest. As collateral security for the prompt
and complete payment and performance when due (whether at the stated maturity,
by acceleration or otherwise) of the Obligations, the Borrower hereby grants to
the Agent for the ratable benefit of the Lenders a security interest in all of
the following property now owned or at any time hereafter acquired by the
Borrower or in which the Borrower now has or at any time in the future may
acquire any right, title or interest (collectively, the "Collateral"):
(a) all Accounts;
(b) all Chattel Paper;
(c) all Contracts;
(d) all Documents;
(e) all Equipment;
(f) all General Intangibles;
(g) all Instruments, other than Excluded Investments;
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(h) all Inventory;
(i) all Patents;
(j) all Patent Licenses;
(k) all Trademarks;
(l) all Trademark Licenses;
(m) all Vehicles;
(n) all books, records, ledgercards, files, correspondence,
computer programs, tapes, disks, and related data processing software (owned by
the Borrower or in which it has an interest) that at any time evidence or
contain information relating to any Collateral or are otherwise necessary or
helpful on the collection thereof or realization thereupon; and
(o) to the extent not otherwise included, all Proceeds and products
of any and all of the foregoing and all collateral security and guarantees
given by any Person with respect to any of the foregoing.
3. Representations and Warranties. The Borrower hereby represents
and warrants that:
3.1 Title; No Other Liens. Except for the security interest granted
to the Agent for the ratable benefit of the Lenders pursuant to this Agreement
and the other Liens permitted to exist on the Collateral pursuant to the Credit
Agreement, the Borrower owns each item of the Collateral free and clear of any
and all Liens or claims of others. No financing statement or other public
notice with respect to all or any part of the Collateral is on file or of
record in any public office, except such as have been filed in favor of the
Agent, for the ratable benefit of the Lenders, pursuant to this Agreement or as
are permitted pursuant to the Credit Agreement.
3.2 Perfected First Priority Liens. The security interests granted
pursuant to this Agreement (a) upon completion of the filings and other actions
specified on Schedule 5 will constitute perfected security interests in the
Collateral (other than Vehicles) in favor of the Agent, for the ratable benefit
of the Lenders, as collateral security for the Obligations and (b) are prior to
all other Liens on the Collateral in existence on the date hereof.
3.3 Inventory and Equipment. The Inventory and the Equipment are
kept at the locations listed on Schedule 6.
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3.4 Chief Executive Office. The chief executive office of the
Borrower is located at:
Travel Channel Acquisition Corporation
c/o Paxson Communications Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
3.5 Farm Products. None of the Collateral constitutes, or is the
Proceeds of, Farm Products.
4. Covenants. The Borrower covenants and agrees with the Agent and
the Lenders that, from and after the date of this Agreement until the
Obligations shall have been paid in full and the Commitments shall have expired
or otherwise been terminated:
4.1 Delivery of Instruments and Chattel Paper. If any amount payable
under or in connection with any of the Collateral shall be or become evidenced
by any Instrument or Chattel Paper, such Instrument or Chattel Paper shall be
immediately delivered to the Agent, duly indorsed in a manner satisfactory to
the Agent, to be held as Collateral pursuant to this Agreement.
4.2 Maintenance of Insurance. The Borrower will maintain insurance
on the Collateral as required under the Credit Agreement.
4.3 Maintenance of Perfected Security Interest; Further
Documentation. (a) The Borrower shall maintain the security interest created
by this Agreement as a perfected security interest having at least the priority
described in subsection 3.2 and shall defend such security interest against the
claims and demands of all Persons whomsoever.
(b) At any time and from time to time, upon the written request of
the Agent, and at the sole expense of the Borrower, the Borrower will promptly
and duly execute and deliver such further instruments and documents and take
such further actions as the Agent may reasonably request for the purpose of
obtaining or preserving the full benefits of this Agreement and of the rights
and powers herein granted, including, without limitation, the filing of any
financing or continuation statements under the Uniform Commercial Code in
effect in any jurisdiction with respect to the security interests created
hereby.
4.4 Changes in Locations, Name, etc. The Borrower will not:
(a) permit any of the Inventory or Equipment to be kept at a location
other than those listed on Schedule 6; or
(b) change the location of its chief executive office from that
specified in subsection 3.4, unless it shall have given the Agent and the
Lenders at least 30 days' prior written notice of such change;
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(c) change its name, identity or corporate structure to such an extent
that any financing statement filed by the Agent in connection with this
Agreement would become seriously misleading, unless it shall have given the
Agent and the Lenders at least 30 days' prior written notice of such change.
4.5 Further Identification of Collateral. The Borrower will furnish
to the Agent and the Lenders from time to time statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as the Agent may reasonably request, all in reasonable
detail.
4.6 Notices. The Borrower will advise the Agent and the Lenders
promptly, in reasonable detail, at their respective addresses for notices
provided for in the Credit Agreement of:
(a) any Lien (other than security interests created hereby or Liens
permitted under the Credit Agreement) on any of the Collateral; and
(b) of the occurrence of any other event which could reasonably be
expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.
5. Provisions Relating to Receivables.
5.1 Borrower Remains Liable under Receivables. Anything herein to
the contrary notwithstanding, the Borrower shall remain liable under each of
the Receivables to observe and perform all the conditions and obligations to be
observed and performed by it thereunder, all in accordance with the terms of
any agreement giving rise to each such Receivable. Neither the Agent nor any
Lender shall have any obligation or liability under any Receivable (or any
agreement giving rise thereto) by reason of or arising out of this Agreement or
the receipt by the Agent or any Lender of any payment relating to such
Receivable pursuant hereto, nor shall the Agent or any Lender be obligated in
any manner to perform any of the obligations of the Borrower under or pursuant
to any Receivable (or any agreement giving rise thereto), to make any payment,
to make any inquiry as to the nature or the sufficiency of any payment received
by it or as to the sufficiency of any performance by any party under any
Receivable (or any agreement giving rise thereto), to present or file any
claim, to take any action to enforce any performance or to collect the payment
of any amounts which may have been assigned to it or to which it may be
entitled at any time or times.
5.2 Analysis of Receivables. Upon the occurrence and continuance of
an Event of Default: (a) The Agent shall have the right to make test
verifications of the Receivables in any manner and through any medium that it
reasonably considers advisable, and each Borrower shall furnish all such
assistance and information as the Agent may require in connection with such
test verifications; (b) upon the Agent's request and at the expense of such
Borrower, such Borrower shall cause independent public accountants or others
satisfactory to the Agent to furnish to the Agent reports showing
reconciliations, aging and test verifications of, and trial balances for, the
Receivables; and (c) the Agent in its own name
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or in the name of others may communicate with the obligors on the Receivables
to verify with them to the Agent's satisfaction the existence, amount and terms
of any Receivables.
5.3 Collections on Receivables. (a) The Agent hereby authorizes the
Borrower to collect the Receivables, subject to the Agent's direction and
control, and the Agent may curtail or terminate said authority at any time
after the occurrence and during the continuance of an Event of Default. If
required by the Agent at any time after the occurrence and during the
continuance of an Event of Default, any payments of Receivables, when collected
by the Borrower, (i) shall be forthwith (and, in any event, within two Business
Days) deposited by the Borrower in the exact form received, duly indorsed by
the Borrower to the Agent if required, in a Collateral Account maintained under
the sole dominion and control of the Agent, subject to withdrawal by the Agent
for the account of the Lenders only as provided in subsection 9.3, and (ii)
until so turned over, shall be held by the Borrower in trust for the Agent and
the Lenders, segregated from other funds of the Borrower.
(b) Each such deposit of Proceeds of Receivables shall be accompanied
by a report identifying in reasonable detail the nature and source of the
payments included in the deposit.
(c) Upon the occurrence and continuance of an Event of Default, at
the Agent's request, the Borrower shall deliver to the Agent all original and
other documents evidencing, and relating to, the agreements and transactions
which gave rise to the Receivables, including, without limitation, all original
orders, invoices and shipping receipts.
5.4 Representations and Warranties. (a) No amount payable to the
Borrower under or in connection with any Receivable is evidenced by any
Instrument or Chattel Paper which has not been delivered to the Agent.
(b) None of the obligors on any Receivables is a Governmental
Authority.
(c) The amounts represented by the Borrower to the Lenders from time
to time (upon the Agent's request) as owing to the Borrower in respect of the
Receivables will at such times be accurate in all material respects.
5.5 Covenants. (a) Other than in the ordinary course of business
consistent with its past practice, the Borrower will not (i) grant any
extension of the time of payment of any Receivable, (ii) compromise or settle
any Receivable for less than the full amount thereof, (iii) release, wholly or
partially, any Person liable for the payment of any Receivable, (iv) allow any
credit or discount whatsoever on any Receivable, (v) amend, supplement or
modify any Receivable in any manner that could adversely affect the value
thereof or (vi) fail to exercise promptly and diligently each and every
material right which it may have under each agreement giving rise to a
Receivable (other than any right of termination).
(b) The Borrower will deliver to the Agent a copy of each material
demand, notice or document received by it that questions the validity or
enforceability of more than 5% of the aggregate amount of the then outstanding
Receivables.
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6. Provisions Relating to Contracts.
6.1 Borrower Remains Liable under Contracts. Anything herein to the
contrary notwithstanding, the Borrower shall remain liable under each of the
Contracts to observe and perform all the conditions and obligations to be
observed and performed by it thereunder, all in accordance with and pursuant to
the terms and provisions of such Contract. Neither the Agent nor any Lender
shall have any obligation or liability under any Contract by reason of or
arising out of this Agreement or the receipt by the Agent or any such Lender of
any payment relating to such Contract pursuant hereto, nor shall the Agent or
any Lender be obligated in any manner to perform any of the obligations of the
Borrower under or pursuant to any Contract, to make any payment, to make any
inquiry as to the nature or the sufficiency of any payment received by it or as
to the sufficiency of any performance by any party under any Contract, to
present or file any claim, to take any action to enforce any performance or to
collect the payment of any amounts which may have been assigned to it or to
which it may be entitled at any time or times.
6.2 Communication With Contracting Parties. Upon the occurrence and
continuance of an Event of Default, the Agent in its own name or in the name of
others may communicate with parties to the Contracts to verify with them to the
Agent's satisfaction the existence, amount and terms of any Contracts.
6.3 Representations and Warranties. (a) No consent of any party
(other than the Borrower) to any Contract is required, or purports to be
required, in connection with the execution, delivery and performance of this
Agreement other than any consent that has been received.
(b) Each Contract is in full force and effect and constitutes a valid
and legally enforceable obligation of the parties thereto, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
(c) No consent or authorization of, filing with or other act by or in
respect of any Governmental Authority is required in connection with the
execution, delivery, performance, validity or enforceability of any of the
Contracts by any party thereto other than those which have been duly obtained,
made or performed, are in full force and effect and do not subject the scope of
any such Contract to any material adverse limitation, either specific or
general in nature.
(d) Neither the Borrower nor (to the best of the Borrower's
knowledge) any of the other parties to the Contracts is in default in the
performance or observance of any of the terms thereof in any manner that, in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
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(e) The right, title and interest of the Borrower in, to and under
the Contracts are not subject to any defenses, offsets, counterclaims or claims
that, in the aggregate, could reasonably be expected to have a Material Adverse
Effect.
(f) The Borrower has made available to the Agent a complete and
correct copy of each Contract, including all amendments, supplements and other
modifications thereto.
(g) No amount payable to the Borrower under or in connection with any
Contract is evidenced by any Instrument or Chattel Paper which has not been
delivered to the Agent.
(h) None of the parties to any Contract is a Governmental Authority.
Schedule 1 accurately specifies all contracts, agreements, instruments or
indentures referred to in clauses (i), (ii) and (iii) of the definition of
"Contracts" in subsection 1.1.
6.4 Covenants. Except as otherwise provided in the Credit Agreement:
(a) The Borrower will perform and comply in all material respects with all its
obligations under the Contracts.
(b) The Borrower will not amend, modify, terminate or waive any
provision of any Contract in any manner which could reasonably be expected to
materially adversely affect the value of such Contract as Collateral.
(c) The Borrower will exercise promptly and diligently each and every
material right which it may have under each Contract (other than any right of
termination).
(d) The Borrower will deliver to the Agent a copy of each material
demand, notice or document received by it relating in any way to any Contract
that questions the validity or enforceability of such Contract.
7. Provisions Relating to Patents and Trademarks.
7.1 Representations and Warranties. (a) Schedule 2 includes all
material Patents and Patent Licenses owned by the Borrower in its own name on
the date hereof.
(b) Schedule 3 includes all material Trademarks and Trademark
Licenses owned by the Borrower in its own name on the date hereof.
(c) To the best of the Borrower's knowledge, each such Patent and
Trademark is on the date hereof valid, subsisting, unexpired, enforceable and
has not been abandoned.
(d) Except as set forth in either Schedule 2 or Schedule 3, none of
such Patents and Trademarks is on the date hereof the subject of any licensing
or franchise agreement.
(e) No holding, decision or judgment has been rendered by any
Governmental Authority which would limit, cancel or question the validity of
any Patent or Trademark in any respect that could reasonably be expected to
have a Material Adverse Effect.
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(f) No action or proceeding is pending on the date hereof (i) seeking
to limit, cancel or question the validity of any Patent or Trademark, or (ii)
which, if adversely determined, would have a material adverse effect on the
value of any Patent or Trademark.
7.2 Covenants.
(a) The Borrower (either itself or through licensees) will (i)
continue to use each material Trademark on each and every trademark class of
goods applicable to its current line as reflected in its current catalogs,
brochures and price lists in order to maintain such Trademark in full force
free from any claim of abandonment for non-use, (ii) maintain as in the past
the quality of products and services offered under such Trademark, (iii) employ
such Trademark with the appropriate notice of registration, (iv) not adopt or
use any ▇▇▇▇ which is confusingly similar or a colorable imitation of such
Trademark unless the Agent, for the ratable benefit of the Lenders, shall
obtain a perfected security interest in such ▇▇▇▇ pursuant to this Agreement,
and (v) not (and not permit any licensee or sublicensee thereof to) do any act
or knowingly omit to do any act whereby such Trademark may become invalidated.
(b) The Borrower will not do any act, or omit to do any act, whereby
any material Patent may become abandoned or dedicated.
(c) The Borrower will notify the Agent and the Lenders immediately if
it knows, or has reason to know, that any application or registration relating
to any material Patent or Trademark may become abandoned or dedicated, or of
any adverse determination or development (including, without limitation, the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office or any court or tribunal in any
country) regarding the Borrower's ownership of any material Patent or Trademark
or its right to register the same or to keep and maintain the same.
(d) Whenever the Borrower, either by itself or through any agent,
employee, licensee or designee, shall file an application for the registration
of any Patent or Trademark with the United States Patent and Trademark Office
or any similar office or agency in any other country or any political
subdivision thereof, the Borrower shall report such filing to the Agent and the
Lenders within five Business Days after the last day of the fiscal quarter in
which such filing occurs. Upon request of the Agent, the Borrower shall
execute and deliver any and all agreements, instruments, documents, and papers
as the Agent may request to evidence the Agent's and the Lenders' security
interest in any Patent or Trademark and the goodwill and general intangibles of
the Borrower relating thereto or represented thereby.
(e) The Borrower will take all reasonable and necessary steps,
including, without limitation, in any proceeding before the United States
Patent and Trademark Office, or any similar office or agency in any other
country or any political subdivision thereof, to maintain and pursue each
application (and to obtain the relevant registration) and to maintain each
registration of the material Patents and Trademarks, including, without
limitation, filing of applications for renewal, affidavits of use and
affidavits of incontestability.
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(f) In the event that any Patent or Trademark is infringed,
misappropriated or diluted by a third party, the Borrower shall (i) take such
actions as the Borrower shall reasonably deem appropriate under the
circumstances to protect such Patent or Trademark and (ii) if such Patent or
Trademark is of material economic value, promptly notify the Agent and the
Lenders after it learns thereof and ▇▇▇ for infringement, misappropriation or
dilution, to seek injunctive relief where appropriate and to recover any and
all damages for such infringement, misappropriation or dilution.
8. Provisions Relating to Vehicles.
8.1 Representation and Warranty. Upon the occurrence and continuance
of an Event of Default, upon the request of the Agent, the Borrower shall
provide within 20 days of such request a complete and correct list of all
Vehicles owned by the Borrower on such date.
8.2 Covenants.
(a) Upon the occurrence and continuance of an Event of Default, no
Vehicle shall be removed from the state which has issued the certificate of
title/ownership therefor for a period in excess of 30 days.
(b) Within 30 days of the date of the Agent's request, all
applications for certificates of title/ownership indicating the Agent's first
priority security interest in the Vehicle covered by such certificate, and any
other necessary documentation, shall be filed in each office in each
jurisdiction which the Agent shall deem advisable to perfect its security
interests in the Vehicles.
9. Remedies.
9.1 Notice to Obligors and Contract Parties. Upon the request of the
Agent at any time after the occurrence and during the continuance of an Event
of Default, the Borrower shall notify obligors on the Receivables and parties
to the Contracts that the Receivables and the Contracts have been assigned to
the Agent for the ratable benefit of the Lenders and that payments in respect
thereof shall be made directly to the Agent.
9.2 Proceeds to be Turned Over To Agent. In addition to the rights
of the Agent and the Lenders specified in subsection 5.3 with respect to
payments of Receivables, if an Event of Default shall occur and be continuing,
upon written notice from the Agent, all Proceeds received by the Borrower
consisting of cash, checks and other near-cash items shall be held by the
Borrower in trust for the Agent and the Lenders, segregated from other funds of
the Borrower, and shall, forthwith upon receipt by the Borrower, be turned over
to the Agent in the exact form received by the Borrower (duly indorsed by the
Borrower to the Agent, if required) and held by the Agent in a Collateral
Account maintained under the sole dominion and control of the Agent. All
Proceeds while held by the Agent in a Collateral Account (or by the Borrower in
trust for the Agent and the Lenders) shall continue to be held as collateral
security for all the Obligations and shall not constitute payment thereof until
applied as provided in subsection 9.3.
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9.3 Application of Proceeds. At such intervals as may be agreed upon
by the Borrower and the Agent, or, if an Event of Default shall have occurred
and be continuing, at any time at the Agent's election, the Agent may apply all
or any part of Proceeds held in any Collateral Account in payment of the
Obligations in such order as the Agent may elect, and any part of such funds
which the Agent elects not so to apply and deems not required as collateral
security for the Obligations shall be paid over from time to time by the Agent
to the Borrower or to whomsoever may be lawfully entitled to receive the same.
Any balance of such Proceeds remaining after the Obligations shall have been
paid in full and the Commitments shall have expired or otherwise been
terminated shall be paid over to the Borrower or to whomsoever may be lawfully
entitled to receive the same.
9.4 Code Remedies. If an Event of Default shall occur and be
continuing, the Agent, on behalf of the Lenders may exercise, in addition to
all other rights and remedies granted to them in this Agreement and in any
other instrument or agreement securing, evidencing or relating to the
Obligations, all rights and remedies of a secured party under the Code.
Without limiting the generality of the foregoing, the Agent, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon the
Borrower or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or any
part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase, or otherwise dispose of and deliver the Collateral or any part
thereof (or contract to do any of the foregoing), in one or more parcels at
public or private sale or sales, at any exchange, broker's board or office of
the Agent or any Lender or elsewhere upon such terms and conditions as it may
deem advisable and at such prices as it may deem best, for cash or on credit or
for future delivery without assumption of any credit risk. The Agent or any
Lender shall have the right upon any such public sale or sales, and, to the
extent permitted by law, upon any such private sale or sales, to purchase the
whole or any part of the Collateral so sold, free of any right or equity of
redemption in the Borrower, which right or equity is hereby waived or released.
The Borrower further agrees, at the Agent's request, to assemble the Collateral
and make it available to the Agent at places which the Agent shall reasonably
select, whether at the Borrower's premises or elsewhere. The Agent shall apply
the net proceeds of any action taken by it pursuant to this subsection, after
deducting all reasonable costs and expenses of every kind incurred in
connection therewith or incidental to the care or safekeeping of any of the
Collateral or in any way relating to the Collateral or the rights of the Agent
and the Lenders hereunder, including, without limitation, reasonable attorneys'
fees and disbursements, to the payment in whole or in part of the Obligations,
in such order as the Agent may elect, and only after such application and after
the payment by the Agent of any other amount required by any provision of law,
including, without limitation, Section 9-504(1)(c) of the Code, need the Agent
account for the surplus, if any, to the Borrower. To the extent permitted by
applicable law, the Borrower waives all claims, damages and demands it may
acquire against the Agent or any Lender arising out of the exercise by them of
any rights hereunder. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable and
proper if given at least 10 days before such sale or other disposition.
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10. Agent's Appointment as Attorney-in-Fact; Agent's Performance of
Borrower's Obligations.
10.1 Powers. The Borrower hereby irrevocably constitutes and
appoints the Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of the Borrower and in the name of
the Borrower or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, and, without limiting the generality of the
foregoing, the Borrower hereby gives the Agent the power and right, on behalf
of the Borrower, without notice to or assent by the Borrower, to do any or all
of the following:
(a) in the name of the Borrower or its own name, or
otherwise, take possession of and indorse and collect any checks,
drafts, notes, acceptances or other instruments for the payment of
moneys due under any Receivable or Contract or with respect to any
other Collateral and file any claim or take any other action or
proceeding in any court of law or equity or otherwise deemed
appropriate by the Agent for the purpose of collecting any and all
such moneys due under any Receivable or Contract or with respect to
any other Collateral whenever payable;
(b) in the case of any Patent or Trademark, execute and
deliver any and all agreements, instruments, documents and papers as
the Agent may request to evidence the Agent's and the Lenders'
security interest in such Patent or Trademark and the goodwill and
general intangibles of the Borrower relating thereto or represented
thereby;
(c) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral, effect any repairs or any insurance
called for by the terms of this Agreement and pay all or any part of
the premiums therefor and the costs thereof;
(d) execute, in connection with any sale provided for in
subsection 9.4, any indorsements, assignments or other instruments of
conveyance or transfer with respect to the Collateral; and
(e) (i) direct any party liable for any payment under any of
the Collateral to make payment of any and all moneys due or to become
due thereunder directly to the Agent or as the Agent shall direct;
(ii) ask or demand for, collect, receive payment of and receipt for,
any and all moneys, claims and other amounts due or to become due at
any time in respect of or arising out of any Collateral; (iii) sign
and indorse any invoices, freight or express bills, bills of lading,
storage or warehouse receipts, drafts against debtors, assignments,
verifications, notices and other documents in connection with any of
the Collateral; (iv) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction
to collect the Collateral or any thereof and to enforce any other
right in respect of any Collateral; (v) defend any suit, action or
proceeding brought against the Borrower with respect to
268
14
any Collateral; (vi) settle, compromise or adjust any such suit,
action or proceeding and, in connection therewith, to give such
discharges or releases as the Agent may deem appropriate; (vii) assign
any Patent or Trademark (along with the goodwill of the business to
which any such Patent or Trademark pertains), throughout the world for
such term or terms, on such conditions, and in such manner, as the
Agent shall in its sole discretion determine; and (viii) generally,
sell, transfer, pledge and make any agreement with respect to or
otherwise deal with any of the Collateral as fully and completely as
though the Agent were the absolute owner thereof for all purposes, and
do, at the Agent's option and the Borrower's expense, at any time, or
from time to time, all acts and things which the Agent deems necessary
to protect, preserve or realize upon the Collateral and the Agent's
and the Lenders' security interests therein and to effect the intent
of this Agreement, all as fully and effectively as the Borrower might
do.
Anything in this subsection to the contrary notwithstanding, the Agent
agrees that it will not exercise any rights under the power of attorney
provided for in this subsection unless an Event of Default shall have occurred
and be continuing.
10.2 Performance by Agent of Borrower's Obligations. If the Borrower
fails to perform or comply with any of its agreements contained herein, the
Agent, at its option, but without any obligation so to do, may perform or
comply, or otherwise cause performance or compliance, with such agreement.
10.3 Borrower's Reimbursement Obligation. The expenses of the Agent
incurred in connection with actions undertaken as provided in this Section,
together with interest thereon at a rate per annum equal to the rate per annum
at which interest would then be payable on past due Base Rate Loans under the
Credit Agreement, from the date of payment by the Agent to the date reimbursed
by the Borrower, shall be payable by the Borrower to the Agent on demand.
10.4 Ratification; Power Coupled With An Interest. The Borrower
hereby ratifies all that said attorneys shall lawfully do or cause to be done
by virtue hereof. All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this Agreement
is terminated and the security interests created hereby are released.
11. Duty of Agent. The Agent's sole duty with respect to the
custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9-207 of the Code or otherwise, shall be to deal with
it in the same manner as the Agent deals with similar property for its own
account. Neither the Agent, any Lender nor any of their respective officers,
directors, employees or agents shall be liable for failure to demand, collect
or realize upon any of the Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Collateral upon the
request of the Borrower or any other Person or to take any other action
whatsoever with regard to the Collateral or any part thereof. The powers
conferred on the Agent and the Lenders hereunder are solely to protect the
Agent's and the Lenders' interests in the Collateral and shall not impose any
duty upon
269
15
the Agent or any Lender to exercise any such powers. The Agent and the Lenders
shall be accountable only for amounts that they actually receive as a result of
the exercise of such powers, and neither they nor any of their officers,
directors, employees or agents shall be responsible to the Borrower for any act
or failure to act hereunder, except for their own gross negligence or willful
misconduct.
12. Execution of Financing Statements. Pursuant to Section 9-402 of
the Code, the Borrower authorizes the Agent to file financing statements with
respect to the Collateral without the signature of the Borrower in such form
and in such filing offices as the Agent reasonably determines appropriate to
perfect the security interests of the Agent under this Agreement. A carbon,
photographic or other reproduction of this Agreement shall be sufficient as a
financing statement for filing in any jurisdiction.
13. Authority of Agent. The Borrower acknowledges that the rights
and responsibilities of the Agent under this Agreement with respect to any
action taken by the Agent or the exercise or non-exercise by the Agent of any
option, voting right, request, judgment or other right or remedy provided for
herein or resulting or arising out of this Agreement shall, as between the
Agent and the Lenders, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Agent and the Borrower, the Agent shall be conclusively presumed
to be acting as agent for the Lenders with full and valid authority so to act
or refrain from acting, and the Borrower shall be under no obligation, or
entitlement, to make any inquiry respecting such authority.
14. Notices. All notices, requests and demands to or upon the Agent
or the Borrower hereunder shall be effected in the manner provided for in
subsection 9.2 of the Credit Agreement.
15. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
16. Amendments in Writing; No Waiver; Cumulative Remedies.
16.1 Amendments in Writing. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except by
a written instrument executed by the Borrower and the Agent, provided that any
provision of this Agreement imposing obligations on the Borrower may be waived
by the Agent in a written instrument executed by the Agent.
16.2 No Waiver by Course of Conduct. Neither the Agent nor any
Lender shall by any act (except by a written instrument pursuant to subsection
16.1), delay, indulgence, omission or otherwise be deemed to have waived any
right or remedy hereunder or to have acquiesced in any Default or Event of
Default. No failure to exercise, nor any delay in
270
16
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Agent or any Lender of any right or remedy
hereunder on any one occasion shall not be construed as a bar to any right or
remedy which the Agent or such Lender would otherwise have on any future
occasion.
16.3 Remedies Cumulative. The rights and remedies herein provided
are cumulative, may be exercised singly or concurrently and are not exclusive
of any other rights or remedies provided by law.
17. Section Headings. The Section and subsection headings used in
this Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation
hereof.
18. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Borrower and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
19. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
271
17
IN WITNESS WHEREOF, the undersigned has caused this Security Agreement
to be duly executed and delivered as of the date first above written.
TRAVEL CHANNEL ACQUISITION
CORPORATION
By: /s/
-----------------------------
272
SCHEDULE I
TO BORROWER'S SECURITY AGREEMENT
CONTRACTS
None.
273
SCHEDULE II
TO BORROWER'S SECURITY AGREEMENT
PATENTS AND PATENT LICENSES
None.
274
SCHEDULE III
TO BORROWER'S SECURITY AGREEMENT
TRADEMARKS AND TRADEMARK LICENSES
See Attached.
275
Copyrights in all episodes of the following programs:
1. "Designs on Travel"
2. "Etc. . . Etc"
3. "The World Through Celebrities Eyes"
4. "First Impressions"
5. "Great Getaway Game"
6. "Inside Travel"
7. "The Perfect Trip"
8. "Sense of Place"
9. "United States"
10. "▇▇▇▇▇▇ ▇▇▇▇▇▇▇'▇ Almanac of Travel"
11. "Countries of the World"
12. "On the Agenda"
276
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Monday, June 09, 1997 Client Status Report Page: 1
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ 74/082821 1681684 WSB Sec. 8 Deadline 31-Mar-1998
Registered 30-Jul-1990 31-Mar-1992 JSP Renewal Earliest Date ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. WXB Next Renewal 31-Mar-2002
Classes: 041 Grace Period Ends 30-Jun-2002
Goods: Entertainment services in the nature of a television program
series featuring travel information
Remarks: Additional Attorney(s): THD THD
First Use In Commerce: 11/26/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Natn-1 Class(es): 107
Service ▇▇▇▇; Supplemental Register
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
DESIGNS ON TRAVEL T07621 74/082822 1692008 WSB Sec. 8 Deadline 09-Jun-1998
Registered 30-Jul-1990 09-Jun-1992 JSP Renewal Earliest Date 09-Dec-2001
United States of America Owner: The Travel Channel, Inc. LJL Next Renewal 09-Jun-2002
Classes: 041 Grace Period Ends 09-Sep-2002
Goods: Entertainment services in the nature of a televised program
series featuring travel information
Remarks: Disclaimer: "travel"
First Use In Commerce: 4/18/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
277
====================================================================================================================================
Monday, June 09, 1997 Client Status Report Page: 2
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
ETC...ETC... T07624 74/084643 1651090 WSB Sec. 8 Deadline 16-Jul-1997
Registered 03-Aug-1990 16-Jul-1991 JSP Renewal Earliest Date 16-Jan-2001
United States of America Owner: The Travel Channel, Inc. WXB Next Renewal 16-Jul-2001
Classes: 041 Grace Period Ends 16-Oct-2001
Goods: Entertainment services in the nature of a televised program
series concerning travel
Remarks: Additional Attorney(s): THD THD
First Use In Commerce: 4/1/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
FIRST IMPRESSIONS T07627 74/209918 1741812 WSB Sec. 8/15 Earliest Dt. 22-Dec-1997
Registered 07-Oct-1991 22-Dec-1992 JSP ▇▇▇ ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. WXB Renewal Earliest 22-Jun-2002
Classes: 041 Next Renewal 22-Dec-2002
Grace Period Ends 22-Mar-2003
Goods: Entertainment services in the nature of a televised program
series featuring travel information
Remarks: Additional Attorney(s): THD THD
First Use In Commerce: 10/1/90
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Natn-1 Class(es): 107
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
278
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Monday, June 09, 1997 Client Status Report Page: 3
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
NAVIGATOR T07924 74/727084 1985853 WSB Sec. 8/15 Earliest Dt. 09-Jul-2001
Registered 11-Sep-1990 09-Jul-1996 JSP Sec. 8 Deadline 09-Jul-2002
THD Renewal Earliest Date 09-Jan-2006
United States of America Owner: The Travel Channel, Inc. Next Renewal 09-Jul-2006
Classes: 16 Grace Period Ends 09-Oct-2006
Goods: Monthly television program guide
Remarks:
Client: 7242 The Travel Channel, Inc.
Registrant: The Travel Channe1, Inc.
------------------------------------------------------------------------------------------------------------------------------------
THE PERFECT TRIP T07625 73/832207 1669767 WSB Sec. 8 Deadline 24-Dec-1997
Registered 18-Oct-1989 24-Dec-1991 JSP Renewal Earliest Date 24-Jun-2001
United States of America Owner: The Travel Channel, Inc. THD Next Renewal 24-Dec-2002
Classes: 041 Grace Period Ends 24-Mar-2002
Goods: Entertainment services in the nature of a travel,tourism and
adventure programs
Remarks: Additional Attorney(s): LJL LJL
First Use In Commerce: 3/19/87
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Natn-1 Class(es):107
Service ▇▇▇▇
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
279
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Monday, June 09, 1997 Client Status Report Page: 4
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 74/688681 1982443 JSP Sec. 8/15 Earliest Dt. 25-Jun-2001
Registered 14-Jun-1995 25-Jun-1996 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. THD Renewal Earliest Date 25-Dec-2005
Classes: 038 & 041 Next Renewal 25-Jun-2006
Grace Period Ends 25-Sep-2006
Goods: Cable television broadcasting services (C1.38); producing
television programs (C1.41)
Remarks: Disclaimer: "channel"
First Use In Commerce: 10/13/86
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
THE TRAVEL CHANNEL T07622 73/308959 1205086 WSB Renewal Earliest Date 10-Feb-2002
Registered 06-May-1981 10-Aug-1982 JSP Next Renewal 10-Aug-2002
United States of America Owner: The Travel Channel, Inc. WXB Grace Period Ends 10-Nov-2002
Classes: 038
Goods: Broadcasting services to cable television systems by the
way of satellite
Remarks: Disclaimer: "channel"
First Use In Commerce: 4/1/81
Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
Service ▇▇▇▇; Supplemental Register
Client: T242 The Travel Channel, Inc.
Registrant: The Travel Channel, Inc.
280
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Monday, June 09, 1997 Client Status Report Page: 5
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
THE TRAVEL CHANNEL & DESIGN T07814 74/688684 1980990 JSP Sec. 8/15 Earliest Dt. 18-Jun-2001
Registered 14-Jun-1995 18-Jun-1996 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. THD Renewal Earliest Date 18-Dec-2005
Classes: 038 & 041 Next Renewal 18-Jun-2006
Grace Period Ends 18-Sep-2006
Goods: Cable television broadcasting services (C1.38); produciing
television programs (C1.41)
Remarks: Disclaimer: "channel"
First Use In Commerce: 5/1/93
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
------------------------------------------------------------------------------------------------------------------------------------
THE TRAVEL CHANNEL & DESIGN 081990 73/684289 1522924 WSB Renewal Earliest Date 31-Jul-2008
Registered 14-Sep-1987 31-Jan-1989 JSP Next Renewal 31-Jan-2009
United States of America Owner: The Travel Channel, Inc. WXB Grace Period Ends 30-Apr-2009
Classes: 38, 39, 41 & 42
Goods: Cable television/broadcasting(C1.38); travel agency
services (C1.39); producing tv programs...(C1.41); tv
shopping services(C1.42)
Remarks: Reel/Frame/Date: 1220/0311; 9/21/94
Assign./Owner Change: From Travel Marketing Corporation
281
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Monday, June 09, 1997 Client Status Report Page:6
Client: T242 The Travel Channel, Inc.
Case Number Application Registration
Trademark Name Status Number/Date Number/Date Attorney(s) Next Action(s) Due Date(s)
====================================================================================================================================
ULTIMATE WORLD TOUR T07995 74/578712 1918300 WSB Sec. 8/15 Earliest Dt. 12-Sep 2000
Registered 26-Sep-1994 12-Sep-1995 JSP Sec. ▇ ▇▇▇▇▇▇▇▇ ▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America Owner: The Travel Channel, Inc. Renewal Earliest Date 12-Mar-2005
Classes: 35 Next Renewal 12-Sep-2005
Goods: Promoting the sale of goods and services of others by Grace Period Ends 12-Dec-2005
conducting an incentive program
Remarks: First Use In Commerce: 9/1/94
Natn-1 Class(es): 100, 101, 102
Client: T242 The Travel Channel
Registrant: The Travel Channel, Inc.
282
SCHEDULE IV
TO BORROWER'S SECURITY AGREEMENT
VEHICLES
Not Applicable.
283
SCHEDULE V
TO BORROWER'S SECURITY AGREEMENT
FILING AND OTHER ACTIONS
REQUIRED TO PERFECT SECURITY INTERESTS
Uniform Commercial Code Filings
a. File in the following:
Georgia-Secretary of State and Dekalb County
b. Precautionary Statement - Should file in the
following:
Virginia - Secretary of State and City of Norfolk
Florida - Secretary of State
Patent and Trademark Filings
See Attached.
Other Actions
284
SCHEDULE VI
TO BORROWER'S SECURITY AGREEMENT
INVENTORY AND EQUIPMENT
Inventory and Equipment located in the following places:
1. The Travel Channel, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
2. ▇▇▇▇▇▇▇▇ Communications, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
285
▇▇▇▇▇▇ Communications Corporation
[LOGO] ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
(▇▇▇)▇▇▇-▇▇▇▇ - FAX (▇▇▇)▇▇▇-▇▇▇▇
July 11, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇.▇., as Agent,
and
The Lenders Party to the Credit Agreement
Referred to Below
Re: Credit Agreement, dated as of July 11, 1997, among Travel
Channel Acquisition Corporation, Union Bank of California,
N.A., as agent, and the Lenders parties thereto
Ladies and Gentlemen:
I am General Counsel to ▇▇▇▇▇▇ Communications Corporation, a Delaware
corporation ("PCC") Travel Channel Acquisition Corporation, a Delaware
corporation (the "Borrower"), and ▇▇▇▇▇▇ Communications Unrestricted Holdings,
Inc., a Delaware corporation ("Pledgor" and collectively with the Borrower, the
"Loan Parties"), with respect to the loans to be made to the Borrower pursuant
to the Credit Agreement. dated as of July 11, 1997, among the Borrower, Union
Bank of California, N.A. as agent, and the Lenders parties thereto (the
"Credit Agreement"). I am providing this opinion to you at the request of the
Loan Parties and pursuant to Section 4.1 of the Credit Agreement. Capitalized
terms used but not defined herein shall have the meanings assigned to such
terms in the Credit Agreement.
In connection with rendering this opinion, I have examined and am
relying upon copies of the final forms of the following instruments and
documents:
1. The Credit Agreement;
2. The Notes;
3. The Borrower Security Agreement;
4. The PCUH Pledge Agreement;
5. The ▇▇▇▇▇▇ Pledge Agreement (collectively with the PCUH Pledge
Agreement, the "Pledge Agreements");
▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇.▇., as Agent,
and The Lenders Party to the Credit Agreement
July 11, 1997
Page 2
6. Stock Powers executed in blank in connection with the Pledge
Agreements (the "Pledge Stock Powers"); and
7. The Certificate of Incorporation and Bylaws of the Loan
Parties, as amended through the date hereof;
8. Certain records of proceedings of the Boards of Directors of
the Loan Parties; and
9. The Letter Agreement dated July 11, 1997 between PCC and you.
Although documents (1) through (6) are sometimes referred to below
collectively as the "Loan Documents", they do not constitute all of the loan
documents utilized in connection with the transaction. The opinions expressed
below relate solely to the documents listed above and not to any other
documents that are referred to in, incorporated by reference into, or listed as
attachments, exhibits, or schedules to any of the documents listed above,
except as may be otherwise specifically noted.
With respect to factual matters, I have examined and am relying upon
and assume the completeness and accuracy of Borrower's representations and
warranties made in the Loan Documents. I have assumed that each Loan Party
qualified and is authorized to do business and is in good standing in all
jurisdictions where it is required to be so qualified except where the failure
to be so qualified would not, singly or in the aggregate, have a Material
Adverse Effect. I have made such further inquiry of the Loan Parties or
investigation of the books, records, files, or other business papers of the
Loan Parties (other than any independent investigation in any court, agency,
governmental office, or elsewhere) with respect to factual matters as I have
deemed reasonably necessary in connection therewith. To the extent that any
opinion expressed below is given "to my current actual knowledge," such opinion
is based solely upon such representations, warranties, and certificates of the
Loan Parties (as to matters of fact only), and my current actual knowledge and
does not (i) include constructive or assumed notice or knowledge of matters or
information or (ii) imply that I have undertaken any independent investigation
with any persons other than those described above. Furthermore, such references
mean only that I do not know of any fact or circumstance contradicting the
statement which follows.
Based upon the foregoing and subject to the qualifications stated
herein, I am of the opinion that:
▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇.▇., as Agent,
and The Lenders Party to the Credit Agreement
July 11, 1997
Page 3
1. Each Loan Party has obtained all requisite consents, approvals
authorizations and filings of any New York or federal
authority that I have in the exercise of customary
professional diligence, recognized as directly applicable to
the Loan Parties or to transactions of the type contemplated
by the Credit Agreement or for each Loan Party to own and
operate its property and assets and to transact the business
in which it is engaged except for those consents, approvals,
authorizations and filings which have been obtained or which,
if not obtained, would not reasonably be expected to have a
Material Adverse Effect.
2. Each of the Loan Documents constitutes the legal, valid and
binding obligation of each of the Loan Parties which is a
party thereto, enforceable in accordance with its terms. The
Letter Agreement constitutes the legal valid and binding
obligation of PCC enforceablein accordance with its terms.
3. The Borrower Security Agreement (other than with respect to
the security interests in the Patent, Trademarks and
Copyrights (each as defined in each of the Borrower Security
Agreement) as to which I express no opinion) constitutes a
valid and binding obligation of each Loan Party thereto and
creates in favor of the Agent a valid and binding security
interest in the collateral described therein, enforceable
against each Loan Party thereto in accordance with its terms.
4. The execution, delivery and performance by each Loan Party of
each of the terms and conditions of each Loan Document to
which it is a party, and the consummation of each of the
transactions contemplated thereby, will not (i) conflict with
any law, rule, or regulation of the State of New York which,
in my experience, are normally applicable to transactions of
the type contemplated by the Loan Documents, but without my
having made any special investigation concerning any other
law, rule, or regulation or (ii) result in any breach of any
of the terms, covenants, conditions or provisions of, or
constitute a default (including any default arising with the
giving of notice or the passage of time, or both) under, or
(other than pursuant to the Borrower Security Agreement)
result in the creation or imposition of (or the obligation to
create or impose) any Lien upon any of the property or assets
of any Loan Party pursuant to the terms of any Contractual
Obligation to which any Loan Party is a party or by which it
or any of its property or assets if bound or to which it may
be subject, except where such
288
Union Bank of California. N.A., as Agent,
and The Lenders Party to the Credit Agreement
July 11, 1997
Page 4
contravention, conflict. breach. default, creation imposition or
obligation would not, singly or in the aggregate with all such other
events have a Material Adverse Effect.
5. The Pledge Agreements together with the delivery of the certificates
representing the shares of stock delivered in pledge by the Pledgors
thereunder on the date hereof (as to all such parties, the "Initial
Pledged Shares") to the Agent in the State of New York, creates in
favor of the Agent a perfected security interest under the New York
UCC in the Initial Pledged Shares. Assuming the Agent and the other
Lenders acquire their interest in the Initial Pledged Shares in good
faith and without notice of any adverse claims, and that each Initial
Pledged Share is either in bearer form issued or endorsed in the name
of the Agent or in blank, the Agent's security interest in the Initial
Pledged Shares is subject to no equal or prior security interest which
must be perfected by possession or filing under the New York UCC.
6. There is no proceeding pending or, to my current actual knowledge,
threatened against or affecting any Loan Party (other than any
proceeding affecting the broadcasting industry generally) or any of
their properties or assets that would, singly or in the aggregate with
all such Proceedings, have a Material Adverse Effect.
7. No third-party consent (other than third-party consents that have been
obtained and are in full force and effect), is required to authorize
or is required in connection with (i) the execution, delivery and full
and timely performance of any of the terms and provisions of, or
consummation of any of the transactions contemplated by any Loan
Document or the Letter Agreement or (ii) the legality, validity,
binding effect or enforceability of any Loan Document or the Letter
Agreement.
My opinions in paragraphs 1, 2 and 4 above are subject to (a) bankruptcy.
insolvency, reorganization, fraudulent conveyance, moratorium or similar laws
affecting creditors' rights generally, (b) general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good
faith and fair dealing and the possible unavailability of specific performance
or injunctive relief, regardless of whether considered in a proceeding in
equity or at law, (c) public policy considerations or court decisions which may
limit the rights of the Lenders or the Agents to obtain indemnification, (d)
the unenforceability under certain circumstances of rights of set-off
289
Union Bank of California. N.A., as Agent,
and The Lenders Party to the Credit Agreement
July 11, 1997
Page 5
with respect to extensions of credit under the Credit Agreement in which
participation have been granted purported to be provided for in the Loan
Documents. and (e) the unenforceability of provisions prohibiting transfers to
the extent they include transfers described in Section 9-311 of the UCC in the
State of New York. I further advise you that certain provisions of the Loan
Documents are or may be unenforceable in whole or in part, but the inclusion of
such provisions does not affect the validity of any of the remaining provisions
of the Loan Documents and such limitations and unenforceability do not make the
rights and remedies provided in or contemplated by the Loan Documents
inadequate for the practical realization of the rights and benefits afforded
thereby.
In rendering the opinions in paragraphs 4 and 5 I have assumed (a)
that each Loan Party has, or will have as of the relevant times, rights in the
Collateral in which such Loan Party has granted a security interest to Agent
within the meaning of Section 9-203(1)(c) of the UCC of the State of New York.
(b) that "value" has been given within the meaning of 9-203(1)(b) of the UCC
in the State of New York, (c) that none of the Collateral arises out of any
transaction described in Section 9-104 of the UCC in the State of New York.
(d) the sufficiency and adequacy for purposes of the UCC of the State of New
York of the signature of the secured party and (e) that no agreements or
understanding exists between any Agent or any Lender, on the one hand, and any
Loan Party or third parties, on the other hand, that would modify, release or
terminate the security interests granted to the Agent pursuant to the Security
Documents. I express no opinion with respect to the validity, creation or
perfection of the security interests granted to the Agent pursuant to the
Security Documents in any Collateral to the extent that such Collateral
includes or may include trademarks, service marks, trade names, copyrights,
patents, trade secrets, "know-how" or the like. I also call your attention to
the fact that under certain circumstances described in Section 9-306 of the
UCC in the State of New York, the right of a secured party to enforce its
security interests in proceeds of Collateral may be limited.
My opinion in paragraphs 3 and 5 should be interpreted in accordance
with the Special Report by the TriBar Opinion Committee: U.C.C. Security
Interest Opinions, 49 Bus. Law. 359 (1993). Insofar as my opinion in paragraph
5 relates to the enforceability of the Pledge Agreements with respect to the
Pledged Shares pledged thereunder as of the Closing Date, such opinion is given
only to the extent that (y) New York law is applicable thereto and (z) each
Pledged Share constitutes a "certificated security" within the meaning of
Section 8-102(1)(a) of the New York UCC.
290
Union Bank of California. N.A., as Agent,
and The Lenders Party to the Credit Agreement
July 11, 1997
Page 6
Insofar as the Security Documents create security interests in
after-acquired property, such security interests may be subject to Sections 547
and 552 of the Bankruptcy Code.
To the extent that the obligations of any Loan Party may be dependent
upon such matters, I assume for purposes of this opinion that the Loan
Documents have been duly authorized, executed and delivered by the Loan
Parties, Agent and the Lenders which are parties to such Loan Documents and
constitute the legally valid and binding obligations of the Agent and such
Lenders, enforceable against the Agent and such Lenders in accordance with
their respective terms subject to bankruptcy, insolvency, reorganization.
fraudulent conveyance, moratorium or similar laws affecting creditors' rights
generally and general principles of equity. I am not expressing any opinion as
to the effect of compliance by any Agent or any Lender with any state or
Federal laws or regulations applicable to the transactions contemplated by the
Loan Documents because of the nature of any Agent's or any such Lender's
business.
My opinions set forth herein are limited to the federal laws of the
United States of America (other than the Communications Act) and the internal
laws of the State of New York and I express no opinion as to the laws of any
other jurisdiction. With respect to the opinions expressed herein that relate
to the ▇▇▇▇▇▇ Pledge Agreement, including paragraphs 2, 5 and 7 hereof I have
relied upon the opinion of Beckley, Singleton, ▇▇▇▇▇▇▇ & List, Chtd., dated as
of the date hereof, a copy of which has been delivered to you, as to matters of
Nevada law.
This opinion is rendered pursuant to your request, is intended solely
for your benefit and can be relied on solely by you and any successors and
assigns in connection with the Loan Documents. This opinion is not to be
furnished, quoted, or referred, to any other party or to any governmental
agency, except for any participants, or used for any other purpose without my
prior written consent.
Very truly yours,
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
-----------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
General Counsel
291
[DOW, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, PLLC LETTERHEAD]
As of July 11, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, N.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Credit Agreement, dated as of July 11, 1997, among Travel
Channel Acquisition Corporation, Union Bank of California,
N.A., as agent, and the Lenders parties thereto
Dear Sirs:
We have acted as special counsel to Travel Channel Acquisition
Corporation, a Delaware corporation (the "Borrower"), and ▇▇▇▇▇▇ Communications
Unrestricted Holdings, Inc., a Delaware corporation ("Pledgor"), with respect
to the loans to be made to the Borrower pursuant to the Credit Agreement, dated
as of July 11, 1997, among the Borrower, Union Bank of California, N.A., as
agent, and the Lenders parties thereto (the "Credit Agreement"). We have been
asked by the Borrower to deliver this opinion to you in connection with loans
to be made by you to the Borrower pursuant to the Credit Agreement. Capitalized
terms that are not defined in this Agreement but are defined in the Credit
Agreement have the meanings assigned to them in the Credit Agreement.
In connection with this opinion, we have examined the following
documents:
1. The Certificate of Incorporation of the Borrower, in the form
certified by the Secretary of State of the State of Delaware to have been filed
on June 11, 1997, and certified by an officer of the Borrower to be in full
force and effect, without amendment or modification, on the effective date of
this opinion.
2. The By-laws of the Borrower, in the form certified by an officer of
the Borrower to be in full force and effect, without amendment or modification,
on the effective date of this opinion.
3. The Certificate of Incorporation of the Pledgor, in the form
certified by the Secretary of State of the State of Delaware to have been filed
on July 10, 1997 and certified by an officer of the Pledgor to be in full force
and effect, without amendment or modification, on the effective date of this
opinion.
292
Union Bank of California, N.A.
As of July 11, 1997
Page 2
4. The By-laws of the Pledgor, in the form certified by an officer of
the Pledgor to be in full force and effect, without amendment or modification,
the effective date of this opinion.
5. Resolutions of the Board of Directors of the Borrower, in the form
certified by an officer of the Borrower to have been duly adopted and to be in
full force and effect, without revocation, rescission, amendment, or
modification, on the effective date of this opinion.
6. Resolutions of the Board of Directors of the Pledgor, in the form
certified by an officer of the Pledgor to have been duly adopted and to be in
full force and effect, without revocation, rescission, amendment, or
modification, on the effective date of this opinion.
7. A Certificate of Good Standing with respect to the Borrower, issued
by the Secretary of State of the State of Delaware on July 11, 1997.
8. A Certificate of Existence and a Certificate of Authority to
Transact Business with respect to the Borrower, each issued by the Secretary of
State of the State of Georgia on July 9, 1997.
In connection with this opinion, we have also examined unexecuted
drafts of the following documents (the "Loan Documents"):
1. The Credit Agreement.
2. The Borrower Security Agreement.
3. The PCUH Pledge Agreement.
4. The Revolving Credit Note.
5. The Term Note.
We have assumed the genuineness of all signatures; the authenticity of
all documents submitted to us as originals; the conformity with the original
documents of all documents submitted to us as certified, conformed, or
photostatic copies; the legal capacity of all natural persons; and that all
documents reviewed by us (including each of the Loan Documents) were are
binding upon and enforceable against the parties thereto. For those of the Loan
Documents received and reviewed by us in the form of unexecuted drafts, we have
assumed
▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, N.A.
As of July 11, 1997
Page 3
that those documents, as executed, conform to the drafts we have reviewed in
every respect material to our opinions herein. The opinions expressed in this
letter are based solely upon our review of those documents that are
specifically referred to in this letter as having been reviewed by us. We have
not examined any other documents, instruments, or corporate records in
connection with this opinion.
As to questions of fact material to our opinions, we have relied
solely, without any inquiry or verification by us, upon the representations and
warranties of the parties in the Loan Documents and upon representations of
officers or representatives of the Borrower and the Pledgor.
This opinion is limited to the General Corporation Law of the State of
Delaware and the Uniform Commercial Code as in effect in the State of Georgia
("Georgia UCC"). We do not purport to be experts in the law of the State of
Delaware. We express no opinion as to conflicts of law rules or the laws of any
states or jurisdictions other than as explicitly specified above.
Based on the foregoing and subject to the qualifications, limitations,
and assumptions set forth herein, it is our opinion that:
1. Each of the Borrower and the Pledgor is a corporation duly
organized, validly existing, and in good standing under the laws of the State
of Delaware. The Borrower is qualified to do business as a foreign corporation
in the State of Georgia.
2. The execution, delivery, and performance by the Borrower and the
Pledgor of the Loan Documents to which each is a party, (a) are within the
corporate power of the Borrower and the Pledgor, as the case may be, which is a
party thereto, (b) have been duly authorized by all necessary corporate action,
and (c) are not in contravention of any provision of the Certificate of
Incorporation or By-laws of either the Borrower or the Pledgor or any provision
of the General Corporation Law of the State of Delaware.
3. The Borrower Security Agreement is in form sufficient to create
valid security interests in favor of the Agent (as defined in the Borrower
Security Agreement) in any rights of the Borrower in the collateral described
in the Borrower Security Agreement to the extent such collateral is personal
property in which a security interest may be created under Article 9 of the
Georgia UCC and perfected by the filing of a financing statement under Article
9 of the Georgia UCC and which is located in the State of Georgia and, as to
proceeds, to the extent a security interest can be created under Article 9 of
the Georgia UCC in such proceeds, as security for the obligations recited in
the Borrower Security Agreement to be
▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, N.A.
As of July 11, 1997
Page 4
secured thereby. The filing of financing statements in appropriate form, signed
by the Borrower, in the office of the Clerk of the Superior Court of DeKalb
County, Georgia, will perfect such security interests in such of the collateral
as to which perfection is accomplished by the filing of a financing statement,
except that perfection of the Agent's security interest in proceeds will be
limited to the extent provided in Section 9-306 of the Georgia UCC.
The opinions set forth above are subject to the following additional
qualifications:
1. We express no opinion with respect to any authorization, consent,
or approval of, or other action by, or notice to or filing with any
governmental agency or authority or any other person that may be required in
connection with exercise by any party of any rights or remedies under any of
the Loan Documents.
2. We have made no examination of, and express no opinion as to, title
to any of the property described in the Loan Documents. We express no opinion
as to security interests in fixtures or as to the priority of any liens or
security interests in any collateral. Except as expressly stated above, no
opinion is expressed herein regarding the creation or perfection of any
security interest or other lien or encumbrance under any state, federal, or
foreign law, statute, regulation, or registration system.
This opinion is as of the effective date hereof, and we expressly
disclaim any duty to update this opinion in the future in the event there are
any changes in fact or law that may affect any matter addressed herein.
This letter is solely for your benefit in connection with your loans
to the Borrower pursuant to the Credit Agreement. This letter may not be relied
upon for any other purpose whatsoever or by any other person. This letter may
not be quoted in whole or in part or otherwise referred to in any financial
statements or other public releases, nor may it be filed with any governmental
agency or other person without the prior written consent of this firm
Very truly yours,
DOW, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, PLLC
By: /s/ ▇▇▇▇▇ ▇. Wild
----------------------------------
▇▇▇▇▇ ▇. Wild, Member
295
[BECKLEY, SINGLETON, ▇▇▇▇▇▇▇ & LIST, CHTD. LETTERHEAD]
July 11, 1997
Union Bank of California, N.A., for itself and as Agent for
the Lenders
Re: Credit Agreement: Travel Channel Acquisition Corporation
("Travel")/ Union Bank of California. N.A. ("Union Bank")
Ladies and Gentlemen:
We have acted as special Nevada counsel for Second ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Limited Partnership, a Nevada limited partnership ("Second Crystal"), in
connection with (i) the Credit Agreement dated July 11, 1997 (the "Travel
Credit Agreement") among Travel, a Delaware corporation (the "Borrower"), the
Lenders referred to therein (the "Lenders"), and you, as Agent for the Lenders
(the "Agent"), concerning the ▇▇▇▇▇▇ Pledge Agreement executed and delivered by
Second Crystal as required under the Travel Credit Agreement.
Our client has directed us to provide this opinion to you in
connection with the first Loans under the Travel Credit Agreement. Except as
otherwise specified herein, capitalized terms used in this opinion which are
defined in the Travel Credit Agreement have the same meanings herein as
therein.
We have not participated in the negotiation nor preparation of any of
the Loan Documents. We have examined only undated, unsigned copies of (i) the
Credit Agreement; (ii) the Subsidiaries Guarantee; (iii) the Subsidiaries
Pledge Agreement; (iv) the Subsidiaries Security Agreement; (v) the Borrowing
Certificate; (vi) the Assignment and Acceptance; (vii) the ▇▇▇▇▇▇ Pledge
Agreement; (viii) the PCUH Pledge Agreement; (ix) the Borrower Pledge
Agreement; and (x) Borrower Security Agreement
As to matters of fact necessary to render this opinion, we have relied
solely upon information obtained from (i) Certificate of Existence of ▇▇▇▇▇▇
Enterprises, Inc. (the managing general partner of Second Crystal) executed by
the Secretary of State of the State of Nevada, dated April 23, 1997 and dated
down by computer reference as of July 11, 1997; (ii) Certificate of Existence
of Second ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited Partnership executed by the Secretary of
State of the State of Nevada, dated April 23, 1997 and dated down by computer
reference as of July
296
BECKLEY, SINGLETON, ▇▇▇▇▇▇▇ & LIST, CHTD.
A PROFESSIONAL LAW CORPORATION
July 11, 1997
Page 2
11, 1997; (iii) the recitals, representations and warranties contained in the
Loan Documents: (iv) the Written Consent In Lieu Of A Special Meeting Of The
Board Of Directors Of ▇▇▇▇▇▇ Enterprises, Inc.; and (v) the Written Actions of
General Partners Of Second ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited Partnership.
In rendering this opinion, we have assumed the conformity to original
documents of all documents submitted to us as photostatic copies, and the
accuracy of the documents made available to us. We have also assumed that you
have the power and authority to execute, deliver and perform all agreements and
documents executed by you; that you have duly and validly executed and
delivered such agreements and documents; and that such agreements and documents
are legally valid and binding on and enforceable against you.
Based upon and subject to the foregoing, and subject to the further
qualifications set forth at the end of this opinion, we are of the opinion
that:
1. Second Crystal is a limited partnership duly organized validly
existing and in good standing under the laws of Nevada; has the power and
authority to own its properties and to carry on its business as now being
conducted and as presently contemplated; and has the power and authority to
execute and deliver, and perform its obligations under the ▇▇▇▇▇▇ Pledge
Agreement.
2. ▇▇▇▇▇▇ Enterprises, Inc., the managing general partner of
Second Crystal, is a corporation duly organized, validity existing and in good
standing under the laws of Nevada and has the power and authority to execute
the ▇▇▇▇▇▇ Pledge Agreement on behalf of Second Crystal.
3. When is has been executed and delivered, the ▇▇▇▇▇▇ Pledge
Agreement will be a legal, valid and binding documents enforceable against
Second Crystal except as such enforcement may be limited by bankruptcy,
reorganization, and other laws of general application relating to or affecting
the enforcement of creditor's requests.
4. The execution and delivery of, and performance by, Second
Crystal of its obligations under the ▇▇▇▇▇▇ Pledge Agreement have been duly
authorized by all requisite action and will not violate any provision of law,
the partnership agreement of Second Crystal nor the corporate charter or
by-laws of ▇▇▇▇▇▇ Enterprises, Inc. or, to our knowledge, any order,
297
BECKLEY, SINGLETON, ▇▇▇▇▇▇▇ & LIST, CHTD.
A PROFESSIONAL LAW CORPORATION
July 11, 1997
Page 3
judgment or decree of court or agency of government, any indenture, agreement
or other instrument to which either Second Crystal or ▇▇▇▇▇▇ Enterprise, Inc.
is a party, or by which any such entity is bound.
5. Neither Second Crystal nor ▇▇▇▇▇▇ Enterprises, Inc. is
required to obtain any consent, approval or authorization from, or to file any
declaration or statement with, any governmental instrumentality or other agency
or any other person in connection with or as a condition to the execution,
delivery, performance or enforceability of the ▇▇▇▇▇▇ Pledge Agreement.
6. To our knowledge, there is no action, suit or proceeding at
law or in equity or by or before any governmental instrumentality or other
agency, including any arbitration board or tribunal, pending or threatened (a)
which questions the validity of the ▇▇▇▇▇▇ Pledge Agreement or any action taken
or to be taken pursuant thereto, or (b) against or affecting Second Crystal or
▇▇▇▇▇▇ Enterprises, Inc. which, if adversely determined, either in any case or
in the aggregate. could have a material adverse affect on the business,
operations, properties, assets or condition financial or otherwise, of either
Second Crystal or ▇▇▇▇▇▇ Enterprises, Inc.
Our opinions herein contained are subject to the following
qualifications:
(i) The enforceability of obligations under any agreement or
document is subject to bankruptcy, insolvency, reorganization, moratorium and
similar laws affecting the rights and remedies of creditors generally or the
application of principles of equity whether in an action in law or a proceeding
in equity. In addition we express no opinion regarding the availability of the
remedy of specific performance or of any other equitable remedy or relief to
enforce any right under any agreement or document.
(ii) We are qualified to practice law in the State of Nevada,
and render no opinion herein except as to Nevada law. We specifically advise
you that we have not undertaken any analysis of security matters or issues,
understanding that you rely on other counsel for such analysis, and we express
no opinion on such matters. It is our opinion that the choice of law provisions
contained in the Guaranty Documents would be upheld under the laws of the State
of Nevada, assuming that the State of New York has a substantial relationship
to the transaction.
298
BECKLEY, SINGLETON, ▇▇▇▇▇▇▇ & LIST, CHTD.
A PROFESSIONAL LAW CORPORATION
July 11, 1997
Page 4
This Opinion is delivered only to you in connection with the
transaction referred to above and may not be relied upon, by any person, other
than the Agents, the Lenders from time to time under the Credit Agreements, and
their respective counsel. This Opinion may not be quoted in whole or in part or
furnished to any entities or persons other than your auditors, any governmental
regulatory agency having jurisdiction over you or any of your Affiliates and
any subsequent Lenders or participants in the Loans, without the prior written
consent of this firm. However, this Opinion may be relied upon by ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, Esq., General Counsel of Borrower.
Very truly yours,
BECKLEY, SINGLETON, ▇▇▇▇▇▇▇
& LIST, CHTD.
By: /s/
----------------------------------
299
BORROWING CERTIFICATE
TRAVEL CHANNEL ACQUISITION CORPORATION
AND
LOAN PARTIES
Pursuant to Section 4.1(c) of the Credit Agreement dated as of July
11, 1997 (the "Credit Agreement"; terms defined therein being used herein as
therein defined), among Travel Channel Acquisition Corporation, the several
banks and other financial institutions from time to time parties thereto, and
Union Bank of California, N.A., as Agent:
The undersigned Assistant Secretary of each of Travel Channel Acquisition
Corporation and ▇▇▇▇▇▇ Communications Unrestricted Holdings, Inc. (each a
"Certifying Loan Party") as follows:
1. The representations and warranties of the Certifying Loan Party set
forth in each of the Loan Documents to which it is a party or which
are contained in any certificate furnished by or on behalf of the
Certifying Loan Party pursuant to or in connection with any of the
Loan Documents to which it is a party are true and correct in all
material respects on and as of the date hereof with the same effect as
if made on the date hereof except for representations and warranties
expressly stated to relate to a specific earlier date, in which case
such representations and warranties are true and correct in all
material respects as of such earlier date;
2. No Default or Event of Default shall have occurred and be continuing
as of the date hereof or after giving effect to the Loans to be made
on the date hereof;
3. There are no liquidation or dissolution proceedings pending or to my
knowledge threatened against the Certifying Loan Party, nor has any
other event occurred adversely affecting or threatening the continued
existence of the Certifying Loan Party after the date hereof;
4. Each Certifying Loan Party is a corporation duly incorporated, validly
existing, and in good standing under the laws of the jurisdiction of
its organization;
5. Attached hereto as Annex 1-A and Annex 1-B are the correct and
complete copies of resolutions duly adopted by the Board of Directors
of such Certifying Loan Party on July 11, 1997, authorizing (i) the
execution, delivery and performance of the Loan Documents to which it
is a party and (ii) the transactions contemplated by the Loan
Documents to which it is
300
a party; such resolutions have not in any way been amended, modified,
revoked, or rescinded and have been in full force and effect since
their adoption to and including the date hereof and are now in full
force and effect; such resolutions are the only corporate proceedings
of the Certifying Loan Party now in force relating to or affecting the
matters referred to therein (other than corporate proceedings
authorizing any acquisition); attached hereto as Annex 2-A and Annex
2-B is a correct and complete copy of the Certificate of Incorporation
of the respective Certifying Loan Party as in effect at all times
since July 11, 1997 to and including the date hereof, and such
Certificate or Articles have not been amended, repealed, modified, or
restated; and attached hereto as Annex 3-A and Annex 3-B is a correct
and complete copy of the By-Laws of the respective Certifying Loan
Party as in effect at all times since July 11, 1997 to and including
the date hereof, and such By-Laws have not been amended, repealed,
modified, or restated; and
6. The following persons are now duly elected and qualified officers of
the Certifying Loan Party holding the offices indicated next to their
respective names therein, and such officers have held such offices
with the Certifying Loan Party at all times since the dates indicated
next to their respective titles to and including the date hereof, and
the signatures appearing opposite their respective names below are the
true and genuine signatures of such officers, and each of such
officers is duly authorized to execute and deliver on behalf of the
Certifying Loan Party each of the Loan Documents to which it is a
party, and each of such officers is duly authorized to execute and
deliver on behalf of the Certifying Loan Party any certificate or
other document to be delivered by the Certifying Loan Party pursuant
to the Loan Documents to which it is a party.
Name Office Signature
---- ---------- ---------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman (since 7/11/97) N/A
---------------------------------------
▇▇▇▇▇▇ Tek, Vice President /s/ ▇▇▇▇▇▇ Tek
& Treasurer (since 7/11/97) ---------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Vice President & Assistant /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Secretary (since 7/11/97) ---------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Secretary (since 7/11/97) /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
2
301
IN WITNESS WHEREOF, the undersigned have hereunto set our names as of
the date set forth below.
Date: July 11, 1997
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Assistant Secretary
/s/ ▇▇▇▇▇▇ ▇. Tek
---------------------------
▇▇▇▇▇▇ ▇. Tek
Vice President & Treasurer
The undersigned Secretary of Travel Channel Acquisition Corporation and ▇▇▇▇▇▇
Communications Unrestricted Holdings, Inc. hereby certifies with respect to
each of the Certifying Loan Parties as follows:
Each of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ Tek is, and at all times since
the date set forth under paragraph 6 above has been, the duly elected and
qualified Vice President and Assistant Secretary and vice President and
Treasurer, respectively, of each of the Loan Parties and the signature set
forth for such officer above is such officer's true and genuine signature.
IN WITNESS WHEREOF, the undersigned have hereunto set our names as of
the date set forth below.
Date: July 11, 1997
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Secretary
3
302
ANNEX 1-A
303
WRITTEN CONSENT
OF THE SOLE DIRECTOR OF
TRAVEL CHANNEL ACQUISITION CORPORATION
The undersigned, being the sole Director of Travel Channel Acquisition
Corporation, a Delaware corporation (the "Corporation"), by this consent in
writing in accordance with Section 141(f) of the Delaware General Corporation
Law, does hereby waive all notice of the time, place and purposes of a meeting
of the Corporation's Board of Directors and hereby, consents to the adoption of
the following preambles and resolutions with the same force and effect as if
they had been adopted at a duly convened meeting of the Board of Directors of
the Corporation:
WHEREAS, ▇▇▇▇▇▇ Communications Corporation ("PCC") has entered into an
Asset Acquisition Agreement (the "Acquisition Agreement"), dated as of June 13,
1997, by and among Landmark Communications, Inc., The Travel Channel, Inc.
("TTC") and PCC, pursuant to which the Corporation, as the designated affiliate
of PCC, shall acquire substantially all of the assets owned or rights held by
TTC for use in the business or operations of "The Travel Channel" (the "Travel
Channel Acquisition");
WHEREAS, it has been proposed that, in connection with the Travel
Channel Acquisition, the Corporation execute and deliver a Credit Agreement (the
"Credit Agreement"), by and between the Corporation and Union Bank of
California, N.A., as Agent, pursuant to which, among other things, the
Corporation will obtain (i) a bridge term loan in an aggregate principal amount
of $22,000,000 to be used by the Corporation to finance, in part, the Travel
Channel Acquisition and interest thereon; and (ii) a bridge revolving credit
facility in the aggregate principal amount of $1,000,000 to finance the working
capital needs of the Corporation;
WHEREAS, it has been proposed that the Corporation execute and deliver
the other respective Loan Documents (as that
304
term is defined in the Credit Agreement) contemplated by the Credit Agreement;
WHEREAS, the Credit Agreement and various other respective Loan
Documents (as that term is defined in the Credit Agreement) have been presented
to the sole Director of the Board of Directors of the Corporation (such Credit
Agreement and any other Loan Documents or agreements executed pursuant thereto
are referred to herein collectively as the Loan Documents);
WHEREAS, based on a review of the Loan Documents, the sole Director of
the Board of Directors deems it advisable for business reasons and in the best
interests of the Corporation that the Corporation enter into the transactions
contemplated by the Loan Documents and that the Corporation's officers be
authorized and directed to execute and deliver and to take all actions in
accordance with and pursuant to the terms of the Loan Documents, along with any
other agreements, certificates and instruments that any of such officers deems
desirable, necessary or appropriate in connection therewith.
NOW, THEREFORE, BE IT
RESOLVED, that the form, terms and provisions of the Loan Documents be,
and they hereby are, authorized and approved in each and every respect, and that
the transactions contemplated therein shall be consummated substantially in
accordance with the terms contained therein;
FURTHER RESOLVED, that any of the officers of the Corporation be, and
each hereby is, authorized, empowered and directed to execute, deliver and
perform the Loan Documents substantially in the form presented to the sole
Director of the Corporation, together with any and all such other loan
documents, agreements, certificates and instruments necessary or appropriate in
connection therewith, along with other agreements or certificates, with any such
modifications or amendments thereto, that any of such officers deems desirable,
necessary or appropriate in connection therewith;
FURTHER RESOLVED, that any of the officers of the Corporation, be, and
each hereby is, authorized, empowered, and directed to do and perform all such
further acts and things, to execute and deliver in the name of the Corporation,
to pay all such fees, costs and expenses in the name of the Corporation, and
where necessary or appropriate, to file with the appropriate governmental
authorities all such further certificates, instruments, or other documents as in
their judgment shall be
305
necessary or advisable in order to effectuate the intent and purposes of the
foregoing resolutions, and any or all of the transactions contemplated therein;
and
FURTHER RESOLVED, that all actions previously taken by any of the
officers of the Corporation, in the capacities set forth above, and of any
person designated and authorized to act by any officer of the Corporation, in
connection with the matters set forth in the foregoing resolutions, which
actions would have been authorized by the foregoing resolutions, be, and they
hereby are, authorized, approved, ratified and confirmed as being the actions of
the Corporation.
306
IN WITNESS WHEREOF, the undersigned has executed this Written Consent of the
Sole Director as of this 11 day of July, 1997.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
307
ANNEX 1-B
308
WRITTEN CONSENT
OF THE SOLE DIRECTOR OF
TRAVEL CHANNEL ACQUISITION CORPORATION
The undersigned, being the sole Director of ▇▇▇▇▇▇ Communications
Unrestricted Holding, Inc., a Delaware corporation (the "Corporation"), by this
consent in writing in accordance with Section 141(f) of the Delaware General
Corporation Law, does hereby waive all notice of the time, place and purposes of
a meeting of the Corporation's Board of Directors and hereby, consents to the
adoption of the following preambles and resolutions with the same force and
effect as if they had been adopted at a duly convened meeting of the Board of
Directors of the Corporation:
WHEREAS, the Corporation owns all of the issued and outstanding
capital stock of Travel Channel Acquisition Corporation, a Delaware corporation
("TCAC");
WHEREAS, ▇▇▇▇▇▇ Communications Corporation ("PCC") has entered into an
Asset Acquisition Agreement (the "Acquisition Agreement"), dated as of June 13,
1997, by and among Landmark Communications, Inc., The Travel Channel, Inc.
("TTC") and PCC, pursuant to which TCAC as the designated affiliate of PCC,
shall acquire substantially all of the assets owned or rights held by TTC for
use in the business or operations of "The Travel Channel" (the "Travel Channel
Acquisition");
WHEREAS, it has been proposed that, in connection with the Travel
Channel Acquisition, TCAC execute and deliver a Credit Agreement (the "Credit
Agreement"), by and between the Corporation and Union Bank of California, N.A.,
as Agent, pursuant to which, among other things, TCAC will obtain (i) a bridge
term loan in an aggregate principal amount of $22,000,000 to be used by TCAC to
finance, in part, the Travel Channel Acquisition and interest thereon; and (ii)
a bridge revolving credit facility in the aggregate principal amount of
$1,000,000 to finance the working capital needs of TCAC;
309
WHEREAS, it has been proposed that the Corporation execute and deliver
the other respective Loan Documents (as that term is defined in the Credit
Agreement) to which the Corporation is a party as contemplated by the Credit
Agreement;
WHEREAS, the Credit Agreement and various other respective Loan
Documents (as that term is defined in the Credit Agreement) have been presented
to the sole Director of the Board of Directors of the Corporation (such Credit
Agreement and any other Loan Documents or agreements executed pursuant thereto
are referred to herein collectively as the Loan Documents);
WHEREAS, based on a review of the Loan Documents to which the
Corporation is a party, the sole Director of the Board of Directors deems it
advisable for business reasons and in the best interests of the Corporation that
the Corporation enter into the transactions contemplated by the Loan Documents
as applicable, and that the Corporation's officers be authorized and directed to
execute and deliver and to take all actions in accordance with and pursuant to
the terms of the Loan Documents to which it is a party, along with any other
agreements, certificates and instruments that any of such officers deems
desirable, necessary or appropriate in connection therewith.
NOW, THEREFORE, BE IT
RESOLVED, that the form, terms and provisions of the Loan Documents,
to which the Corporation is a party be, and they hereby are, authorized and
approved in each and every respect, and that the transactions contemplated
therein shall be consummated substantially in accordance with the terms
contained therein;
FURTHER RESOLVED, that any of the officers of the Corporation be, and
each hereby is, authorized, empowered and directed to execute, deliver and
perform the Loan Documents substantially in the form presented to the sole
Director of the Corporation, together with any and all such other loan
documents, agreements, certificates and instruments necessary or appropriate in
connection therewith, along with other agreements or certificates, with any such
modifications or amendments thereto, that any of such officers deems desirable,
necessary or appropriate in connection therewith;
FURTHER RESOLVED, that any of the officers of the Corporation, be, and
each hereby is, authorized, empowered, and directed to do and perform all such
further acts and things, to
310
execute and deliver in the name of the Corporation, to pay all such fees, costs
and expenses in the name of the Corporation, and where necessary or appropriate,
to file with the appropriate governmental authorities all such further
certificates, instruments, or other documents as in their judgment shall be
necessary or advisable in order to effectuate the intent and purposes of the
foregoing resolutions, and any or all of the transactions contemplated therein;
and
FURTHER RESOLVED, that all actions previously taken by any of the
officers of the Corporation, in the capacities set forth above, and of any
person designated and authorized to act by any officer of the Corporation, in
connection with the matters set forth in the foregoing resolutions, which
actions would have been authorized by the foregoing resolutions, be, and they
hereby are, authorized, approved, ratified and confirmed as being the actions of
the Corporation.
311
IN WITNESS WHEREOF, the undersigned has executed this Written Consent of the
Sole Director as of this 11 day of July, 1997.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
312
ANNEX 2-A
313
Office of the Secretary of State PAGE 1
------------------------------
I, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
INCORPORATION OF "TRAVEL CHANNEL ACQUISITION CORPORATION", FILED IN THIS OFFICE
ON THE ELEVENTH DAY OF JUNE, A.D. 1997, AT 2 O'CLOCK P.M.
A CERTIFIED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW
CASTLE COUNTY RECORDER OF DEEDS FOR RECORDING.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
314
CERTIFICATE OF INCORPORATION
OF
TRAVEL CHANNEL ACQUISITION CORPORATION
FIRST. The name of the corporation is Travel Channel Acquisition
Corporation.
SECOND. Its registered office in the State of Delaware is located
at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. The
registered agent in charge thereof is The Corporation Trust Company.
THIRD. The purpose or purposes of the corporation is to engage in
any lawful act or activity for which corporations may be organized under the
General Corporation Law of the State of Delaware, and to have and exercise all
the powers conferred by the laws of the State of Delaware upon corporations
formed under the General Corporation Law of the State of Delaware.
FOURTH. The amount of the total authorized capital stock of this
corporation shall be ten thousand (10,000) shares, par value one cent ($0.01)
per share.
FIFTH. The name and mailing address of the incorporator is as
follows:
▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇
SIXTH. In furtherance and not in limitation of the powers
conferred by statute, the Board of Directors of the corporation shall have the
following powers:
(a) To adopt, and to alter or amend the Bylaws and to fix the
amount to be reserved as working capital: and
(b) With the consent in writing or pursuant to a vote of the
holders of a majority of the capital stock issued and outstanding, to dispose
of, in any manner, all or substantially all of the property of this
corporation.
SEVENTH. The stockholders and directors shall have the power to
hold their meetings and keep the books, documents and papers of the corporation
within or outside the State of Delaware and at such place or places as may be
from time to time designated by the Bylaws or by resolution of the stockholders
or
315
directors, except as otherwise required by the laws of the State of Delaware.
EIGHTH. The objects, purposes and powers specified in any clause
or paragraph of this Certificate of Incorporation shall be in no way limited or
restricted by reference to or inference from the terms of any other clause or
paragraph of this Certificate of Incorporation. The objects, purposes and
powers in each of the clauses and paragraphs of this Certificate of
Incorporation shall be regarded as independent objects, purposes and powers.
The objects, purposes and powers specified in this Certificate of Incorporation
are in furtherance and not in limitation of the objects, purposes and powers
conferred by statute.
NINTH. The corporation shall have the power to indemnify its
officers, directors, employees and agents, and such other persons as may be
designated as set forth in the Bylaws, to the full extent permitted by the laws
of the State of Delaware. A director shall not be personally liable to the
corporation or its stockholders for monetary damages for breach of fiduciary
duties as a director, provided that the liability of a director (i) for any
breach of the director's loyalty to the corporation or its stockholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174 of Title 8 of
the Delaware Code, or (iv) for any transaction from which the director derived
an improper personal benefit shall not be eliminated or limited hereby.
TENTH. The corporation shall have perpetual existence.
The undersigned, ▇▇▇▇▇ ▇. ▇▇▇▇▇, for the purpose of forming a
corporation under the laws of the State of Delaware, does hereby make, file and
record this Certificate of Incorporation and does hereby certify that the facts
herein stated are true, and has accordingly hereunto set her hand and seal.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇, Incorporator
Dated: June 11, 1997
316
ANNEX 2-B
317
State of Delaware
Office of the Secretary of State Page 1
------------------------------
I, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
INCORPORATION OF "▇▇▇▇▇▇ COMMUNICATIONS UNRESTRICTED HOLDINGS, INC.", FILED IN
THIS OFFICE ON THE TENTH DAY OF JULY, A.D. 1997, AT 1 O'CLOCK P.M.
A CERTIFIED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW
CASTLE COUNTY RECORDER OF DEEDS FOR RECORDING.
[SEAL] /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Secretary of State
AUTHENTICATION: 8552494
DATE: 07-10-97
318
CERTIFICATE OF INCORPORATION
OF
TRAVEL CHANNEL ACQUISITION CORPORATION
FIRST. The name of the corporation is ▇▇▇▇▇▇ Communications
Unrestricted Holdings, Inc.
SECOND. Its registered office in the State of Delaware is located
at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. The
registered agent in charge thereof is The Corporation Trust Company.
THIRD. The purpose or purposes of the corporation is to engage in
any lawful act or activity for which corporations may be organized under the
General Corporation Law of the State of Delaware, and to have and exercise all
the powers conferred by the laws of the State of Delaware upon corporations
formed under the General Corporation Law of the State of Delaware.
FOURTH. The amount of the total authorized capital stock of this
corporation shall be ten thousand (10,000) shares, par value one cent ($0.01)
per share.
FIFTH. The name and mailing address of the incorporator is as
follows:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇
SIXTH. In furtherance and not in limitation of the powers
conferred by statute, the Board of Directors of the corporation shall have the
following powers:
(a) To adopt, and to alter or amend the Bylaws and to fix the
amount to be reserved as working capital; and
(b) With the consent in writing or pursuant to a vote of the
holders of a majority of the capital stock issued and outstanding, to dispose
of, in any manner, all or substantially all of the property of this
corporation.
SEVENTH. The stockholders and directors shall have the power to
hold their meetings and keep the books, documents and papers of the corporation
within or outside the State of Delaware and at such place or places as may be
from time to time designated by the Bylaws or by resolution of the stockholders
or directors, except as otherwise required by the laws of the State of Delaware.
319
EIGHTH. The objects, purposes and powers specified in any clause
or paragraph of this Certificate of Incorporation shall be in no way limited or
restricted by reference to or inference from the terms of any other clause or
paragraph of this Certificate of Incorporation. The objects, purposes and
powers in each of the clauses and paragraphs of this Certificate of
Incorporation shall be regarded as independent objects, purposes and powers.
The objects, purposes and powers specified in this Certificate of Incorporation
are in furtherance and not in limitation of the objects, purposes and powers
conferred by statute.
NINTH. The corporation shall have the power to indemnify its
officers, directors, employees and agents, and such other persons as may be
designated as set forth in the Bylaws, to the full extent permitted by the laws
of the State of Delaware. A director shall not be personally liable to the
corporation or its stockholders for monetary damages for breach of fiduciary
duties as a director, provided that the liability of a director (i) for any
breach of the director's loyalty to the corporation or its stockholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174 of Title 8 of
the Delaware Code, or (iv) for any transaction from which the director derived
an improper personal benefit shall not be eliminated or limited hereby.
TENTH. The corporation shall have perpetual existence.
The undersigned, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, for the purpose of forming a
corporation under the laws of the State of Delaware, does hereby make, file and
record this Certificate of Incorporation and does hereby certify that the facts
herein stated are true, and has accordingly hereunto set her hand and seal.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Incorporator
Dated: June 10, 1997
320
ANNEX 3-A
321
BYLAWS
OF
TRAVEL CHANNEL ACQUISITION CORPORATION
ARTICLE I
OFFICES
Section 1. The registered office shall be located at
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 2. The corporation may also have offices at such
other places both within and without the State of Delaware and the United
States as the Board of Directors may from time to time determine or as the
business of the corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. All annual meetings of the stockholders for the
election of directors shall be held at such place either within or without the
State of Delaware or the United States, as shall be designated from time to
time by the Board of Directors and stated in the notice of the meeting or in a
duly executed waiver of the notice thereof. Meetings of stockholders for any
other purpose may be held at such time and place, within or without the State
of Delaware or the United States, as shall be stated in the notice of the
meeting or in a duly executed waiver of notice thereof.
Section 2. Annual meetings of the stockholders shall be held on
such date and at such time as shall be designated from time to time by the
Board of Directors. At the annual meeting, the stockholders shall elect the
Board of Directors and shall transact such other business as may properly be
brought before the meeting.
Section 3. Written notice of the annual meeting stating the
place, date and time of the meeting shall be given not less than ten (10) nor
more than sixty (60) days before the date of the meeting to each stockholder
entitled to vote at such meeting.
Section 4. Special meetings of the stockholders for any purpose
or purposes, unless otherwise provided by statute, the Certificate of
Incorporation or these Bylaws, may be called by the President and shall be
called by the President or Secretary at the request in writing of a majority of
the Board of Directors or at the request in writing of stockholders owning a
majority of the entire capital stock of the corporation issued and outstanding
and entitled to vote. Such requests shall state the purpose or purposes of the
proposed meeting.
322
Section 5. Written notice of a special meeting shall state the
place, date and time of the meeting and the purpose or purposes for which the
meeting is called and shall be given not less than ten (10) nor more than sixty
(60) days before the date of the meeting to each stockholder entitled to vote
at such meeting.
Section 6. Business transacted at any special meeting of the
stockholders shall be limited to the purpose or purposes stated in the notice,
unless the holders of a majority of the issued and outstanding shares entitled
to vote otherwise consent thereto either at the special meeting or in writing
executed subsequent to the meeting,
Section 7. The officer who has charge of the stock ledger of the
corporation shall prepare and make, at least ten (10) days before every annual
or special meeting of the stockholders, a complete list of the stockholders
entitled to vote at the meeting, arranged in alphabetical order, showing the
address of each stockholder and the number of shares registered in the name of
each stockholder. Such list shall be open to examination by any stockholder for
any purpose germane to the meeting during ordinary business hours, and for a
period of at least ten (10) days prior to the meeting either at a place within
the city where the meeting is to be held (which place shall be specified in the
notice of the meeting) or (if not so specified) at the place where the meeting
is to be held. The list shall also be produced and kept at the time and place
of the meeting during the whole time thereof and may be inspected by any
stockholder who is present at the meeting.
Section 8. The holders of a majority of the issued and
outstanding shares entitled to vote thereat, who are present in person or
represented by proxy at the meeting, shall constitute a quorum at all annual
and special meetings of the stockholders for the transaction of business,
unless otherwise provided by statute, the Certificate of Incorporation or these
Bylaws. If, however, such quorum shall not be present or represented at any
meeting of the stockholders, the stockholders entitled to vote thereat, present
in person or represented by proxy, shall have the power to adjourn the meeting
from time to time, without notice other than announcement at the meeting, until
a quorum shall be present or represented. At such adjourned meeting, at which a
quorum shall be present or represented, any business may be transacted that
might have been transacted at the meeting as originally described in the notice
to the stockholders. If the adjournment is for more than thirty (30) days or
if after the adjournment a new record date is fixed for the adjourned meeting,
a notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.
-2-
323
Section 9. When a quorum is present at any annual or special
meeting, the vote of the holders of a majority of the stock having voting power
present in person or represented by proxy at the meeting shall decide any
question brought before such meeting, unless the question is one upon which by
express provision of statute, the Certificate of Incorporation or these Bylaws
a different vote is required, in which case such express provision shall govern
and control the decision of such question.
Section 10. Unless otherwise provided by statute, the Certificate
of Incorporation or these Bylaws, each stockholder shall at every annual or
special meeting of the stockholders be entitled to one vote in person or by
proxy for each share of the capital stock having voting power held by such
stockholder, but no proxy shall be voted or acted upon after a period of three
years from its date, unless the proxy provides for a longer period.
Section 11. Unless otherwise provided by statute, the Certificate
of Incorporation or these Bylaws, any action required or permitted to be taken
at any annual or special meeting of the stockholders may be taken without a
meeting, without prior not ice and without a vote if a consent in writing,
setting forth the action so taken, is signed by the holders of outstanding
stock of the corporation having not less than the minimum number of votes that
would be necessary to authorize or take such action at a meeting at which all
shares entitled to vote thereon were present and voted. Such consent shall be
filed with the Secretary of the corporation. Prompt notice of the taking of the
corporate action without a meeting by less than unanimous written consent shall
be given to those stockholders who have not consented in writing.
ARTICLE III
DIRECTORS
Section 1. The number of directors that constitutes the Board of
Directors shall be at least one (1) and not more than ten (10). The first Board
of Directors shall initially consist of the number of directors as shall be
specified at the organizational meeting of the Corporation. Thereafter, within
the limits above specified, the number of directors shall be determined by
resolution of the Board of Directors or by the stockholders of the Common Stock
at the annual meeting. The directors shall be elected at the annual meeting of
the stockholders, except as provided in Section 2 of this Article. Each
director shall hold office until his successor is elected and qualified.
Directors need not be stockholders.
Section 2. Vacancies and newly created directorships resulting
from any increase in the authorized number of directors may be filled by a
majority of the directors then in office, though less than a quorum, or by a
sole remaining director. The
-3-
324
directors so chosen shall hold office until the next annual election and until
their successors are duly elected and qualified, unless sooner displaced. If
there are no directors in office, then an election of directors may be held
in the manner provided by statute.
Section 3. The business of the corporation shall be managed by
its Board of Directors, which may exercise all such powers of the corporation
and do all such lawful acts and things as are not by statute, the Certificate
of Incorporation or these Bylaws directed or required to be exercised or done
by the stockholders.
ARTICLE IV
MEETINGS OF THE BOARD OF DIRECTORS
Section 1. The Board of Directors of the corporation may hold
meetings, both regular and special, either within or without the State of
Delaware or the United States.
Section 2. The first meeting of each newly elected Board of
Directors shall be held at such time and place as shall be fixed by the vote of
she stockholders at the annual meeting. No notice of such meeting to the newly
elected directors shall be necessary in order legally to constitute the
meeting, provided a quorum shall be present. If the stockholders fail to fix
the time or place of the first meeting of the newly elected Board of Directors
or if this meeting is not held at the time and place so fixed by the
stockholders, the meeting may be held at such time and place as shall be
specified in a notice given as hereinafter provided for special meetings of the
Board of Directors or as shall be specified in a written waiver signed by all
of the directors.
Section 3. Regular meetings of the Board of Directors may be
held without notice at such time and place as shall from time to time be
determined by the Board of Directors.
Section 4. Special meetings of the Board of Directors may be
called by the President on three (3) days notice to each director, either
personally, by mail, by telegram or by telecopy. Such meetings shall be called
by the President or Secretary in like manner and on like notice on the written
request of a majority of the directors.
Section 5. At all regular and special meetings of the Board of
Directors, a simple majority of the directors shall constitute a quorum for the
transaction of business, and the act of a majority of the directors present at
any meeting at which there is a quorum shall be the act of the Board of
Directors, unless otherwise specifically provided by statute, the Certificate
of Incorporation or these Bylaws. If a quorum is not present at any
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meeting of the Board of Directors the directors present thereat may adjourn the
meeting from time to time, without notice other than an announcement at the
meeting, until a quorum shall be present.
Section 6. Unless otherwise provided by statute, the Certificate
of Incorporation or these Bylaws, any action required or permitted to be taken
at any meeting of the Board of Directors or of any committee thereof may be
taken without a meeting if all members of the Board or the committee, as the
case may be, consent thereto in writing, and the writing or writings are filed
with the minutes of the proceedings of the Board of Directors.
ARTICLE V
COMMITTEES OF DIRECTORS
Section 1. The Board of Directors may, by resolution passed by a
majority of the whole Board, designate one or more committee, each consisting
of two or more directors of the corporation. The Board may designate one or
more directors as alternate members of any committee, who may replace any
absent or disqualified member at any meeting of the committee. In the absence
or disqualification of a member of a committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the Board
of Directors to act at the meeting in the place of any such absent or
disqualified member.
Section 2. Except as provided below, any committee, to the
extent provided in the resolutions of the Board of Directors and in these
Bylaws, shall have and may exercise all of the powers and authority of the
Board of Directors in the management of the business and affairs of the
corporation, and may authorize the seal of the corporation to be affixed to all
papers that may require it. No committee, however, shall have the power or
authority to amend the Certificate of Incorporation; to adopt an agreement of
merger or consolidation; to recommend to the stockholders the sale, lease,
exchange or other disposition of all or substantially all of the corporation's
property and assets; to recommend to the stockholders a dissolution of the
corporation or a revocation of a dissolution; or to amend these Bylaws;
further, unless a resolution of the Board of Directors, these Bylaws, or the
Certificate of Incorporation expressly so provides, no committee shall have the
power or authority to declare a dividend, to authorize the issuance of stock,
or to adopt a certificate of ownership and merger.
Section 3. A committee or committees shall have such name or
names an may be determined from time to time by resolution adopted by the Board
of Directors.
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Section 4. Each committee shall keep regular minutes of its
meetings and shall file them with the minutes of the proceedings of the Board
of Directors when required.
ARTICLE VI
COMPENSATION OF DIRECTORS
Section 1. Unless otherwise provided by statute, the Certificate
of Incorporation or these Bylaws, the Board of Directors shall have the
authority to fix the compensation of the directors.
Section 2. The directors may be paid their expenses, if any, of
attending meetings of the Board of Directors. Such payments may take the form
of a fixed sum for attendance at each meeting or a stated salary as a director.
Members of committees may be allowed like compensation for attending committee
meetings.
Section 3. No payment permitted under this Article VI shall
preclude any director from serving the corporation in any other capacity and
receiving compensation therefor.
ARTICLE VII
OFFICERS
Section 1. The officers of the corporation shall be chosen by
the Board of Directors and shall be a Chairman, a President, a Secretary and a
Treasurer. The Board of Directors may also choose additional Vice Presidents,
and one or more Assistant Secretaries and Assistant Treasurers. Any number of
offices may be held by the same person, unless otherwise provided by statute,
the Certificate of Incorporation or these Bylaws.
Section 2. The officers of the corporation shall be elected by
the Board of Directors at the Board's first meeting after each annual meeting of
stockholders.
Section 3. The officers of the corporation shall hold office
until their successors are chosen and qualified. Any officer elected or
appointed by the Board of Directors may be removed at any time by the
affirmative vote of a majority of the Board of Directors whenever in its
judgment the best interests of the corporation will be served thereby. Any
vacancy occurring in any office of the corporation shall be filled by the Board
of Directors.
Section 4. The salaries of all officers and agents of the
corporation shall be fixed by the Board of Directors.
Section 5. The Chairman shall be the Chief Executive Officer of
the corporation, shall preside at all meetings of the
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shareholders and the Board of Directors, shall have general and active
management of the business of the corporation and shall see that all orders and
resolutions of the Board of Directors are carried into effect. He shall execute
bonds, mortgages and other contracts requiring a seal, under the seal of the
corporation, except where required or permitted by law to be otherwise signed
and executed and except where the signing and execution thereof shall be
expressly delegated by the Board of Directors to some other officer or agent of
the corporation.
Section 6. The President, subject to the Chairman, shall be the
Chief Operating Officer of the corporation, in the absence of the President
shall preside at all meetings of the shareholders and the Board of Directors,
shall have general and active management of the business of the corporation and
shall see that all orders and resolutions of the Board of Directors are carried
into effect. He shall execute bonds, mortgages and other contracts requiring a
seal, under the seal of the corporation, except where required or permitted by
law to be otherwise signed and executed and except where the signing and
execution thereof shall be expressly delegated by the Board of Directors to
some other officer or agent of the corporation.
Section 7. In the absence of the President or in the event of
his inability or refusal to act, the Vice President (or in the event there are
more than one, the Vice Presidents in the order designated, or in the absence
of any designation, then in the order of their election) shall perform the
duties of the President and, when so acting, shall have all the powers of and
be subject to all the restrictions upon the President. The Vice President shall
perform such other duties and have such other powers as the Board of Directors
may from time to time prescribe.
Section 8. The Secretary shall attend all meetings of the Board
of Directors and all meetings of the stockholders and record all of the
proceedings of the meetings of the corporation and of the Board of Directors in
a book to be kept for that purpose and shall perform like duties for any
committees when required. The Secretary shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the Board of
Directors and shall perform such other duties as may be prescribed by the Board
of Directors or the President, under whose supervision he shall be. The
Secretary shall have custody of the corporate seal of the corporation, and he,
or an Assistant Secretary, shall have the authority to affix the same to any
instrument requiring it, and (when so affixed) it may be attested by his
signature or by the signature of such Assistant Secretary. The Board of
Directors may give general authority to any other officer to affix the seal of
the corporation and to attest the affixing by his signature.
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Section 9. The Assistant Secretary, or if there are more than
one, the Assistant Secretaries in the order determined by the Board of
Directors (or if there is no such determination, then in the order of their
election), shall, in the absence of the Secretary or in the event of his
inability or refusal to act, perform the duties and exercise the powers of the
Secretary and shall perform such other duties and have such other powers as the
Board of Directors may from time to time prescribe.
Section 10. The Treasurer shall have custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all
moneys and other valuable effects in the name and to the credit of the
corporation in such depositories as may be designated by the Board of
Directors.
Section 11. The Treasurer shall disburse the funds of the
corporation as may be ordered by the Board of Directors, taking proper vouchers
for such disbursements, and shall render to the President, and the Board of
Directors at the Board's regular meetings or when the Board so requires, an
account of all his transactions as Treasurer and of the financial condition of
the corporation.
Section 12. If required by the Board of Directors, the Treasurer
shall give the corporation a bond (which shall be renewed every six years) in
such sum and with such surety or sureties as shall be satisfactory to the Board
of Directors for the faithful performance of the duties of his office and for
the restoration to the corporation, in case of his death, resignation,
retirement or removal from office, of all books, papers, vouchers, money and
other property of whatever kind in his possession or under his control
belonging to the corporation.
Section 13. The Assistant Treasurer, or if there are more than
one, the Assistant Treasurers in the order determined by the Board of Directors
(or if there is no such determination, then in the order Of their election),
shall, in the absence of the Treasurer or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the Treasurer and
shall perform such ocher duties and have such other powers as the Board of
Directors may from time to time prescribe.
ARTICLE VIII
NOTICES
Section 1. Whenever, under the provisions of the statute, the
Certificate of Incorporation or these Bylaws, notice is required to be given to
any director or stockholder, it shall not be construed to mean solely personal
notice, but such notice may be given in writing by mail addressed to such
director or stockholder at his address as it appears on the records of the
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corporation with postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same is deposited in the United States mail. Notice
to directors may also be given by telegram.
Section 2. Whenever any notice is required to be given under the
provisions of statute, the Certificate of Incorporation or these Bylaws, a
waiver thereof in writing, signed by the person or persons entitled to said
notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
ARTICLE IX
CERTIFICATES OF STOCK
Section 1. Every holder of stock in the corporation shall be
entitled to have a certificate, signed by the Chairman or Vice Chairman of the
Board of Directors, or the President or a Vice President, and by the Secretary
or an Assistant Secretary, or the Treasurer or an Assistant Treasurer,
certifying the number of shares owned by the stockholder in the corporation.
Section 2. Any or all of the signatures on the certificate may
be a facsimile if the certificate is manually signed on behalf of a transfer
agent or a registrar (other than the corporation itself or an employee of the
corporation). in case any officer, transfer agent or registrar who has signed
or whose facsimile signature has been placed upon a certificate shall have
ceased to be such officer, transfer agent or registrar before such certificate
is issued, the certificate may be issued by the corporation with the same
effect as if he were such officer, transfer agent of registrar at the date of
issue.
Section 3. The Board of Directors may direct that a new
certificate or certificates be issued in place of any certificate or
certificates theretofore issued by the corporation alleged to have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate to be lost, stolen or destroyed. When authorizing
such issue of a new certificate or certificates, the Board of Directors may, in
its discretion and as a condition precedent to the issuance thereof, require
the owner of such lost, stolen or destroyed certificate or certificates or his
legal representative to advertise the same in such manner as it shall require
and/or to give the corporation a bond in such sum as it may direct as indemnity
against any claim that may be made against the corporation with respect to the
certificate alleged to have been lost, stolen or destroyed.
Section 4. Upon surrender to the corporation or the transfer
agent of the corporation of a certificate for shares
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duly endorsed or accompanied by the proper evidence of succession, assignment
or authority to transfer, the corporation shall issue a new certificate to the
person entitled thereto, cancel the old certificate and record the transaction
upon its books.
Section 5. In order that the corporation may determine the
stockholders entitled to notice of or to vote at any meeting of the
stockholders or any adjournment thereof, or entitled to express consent to
corporate action in writing without a meeting, or entitled to receive payment
of any dividend or other distribution or allotment of any rights, or entitled
to exercise any rights in respect of any change, conversion or exchange of
stock or for the purpose of any other lawful action, the Board of Directors may
fix, in advance, a record date that shall not be more than sixty (60) nor less
than ten (10) days before the date of such meeting, nor more than sixty (60)
days prior to any other action. A determination of stockholders of record
entitled to notice of or to vote at a meeting of stockholders shall apply to
any adjournment of the meeting; provided, however, that the Board of Directors
may fix a new date for the adjourned meeting.
Section 6. The corporation shall be entitled to recognize the
exclusive rights of a person registered on its books as the owner of shares to
receive dividends and to vote as such owner. The corporation shall be entitled
to hold liable for calls and assessments a person registered on its books as
the owner of shares. The corporation shall not be bound to recognize any
equitable or other claim to or interest in such share or shares on the part of
any other person, regardless of whether the corporation shall have express or
other notice thereof, unless otherwise provided by statute, the Certificate of
Incorporation or these Bylaws.
ARTICLE X
GENERAL PROVISIONS
Section 1. Dividends. Dividends upon the capital stock of the
corporation, unless otherwise provided by statute, the Certificate of
Incorporation or these Bylaws, may be declared by the Board of Directors at any
regular or special meeting, pursuant to law. Dividends may be paid in cash,
property, or in shares of stock, unless otherwise provided by statute, the
Certificate of Incorporation or these Bylaws. Before payment of any dividend,
there may be get aside out of any funds of the corporation available for
dividends such sum or sums as the Board of Directors from time to time, in
their absolute discretion, may think proper as a reserve or reserves for
contingencies, equalizing dividends, repairing or maintaining any property of
the corporation, or for much other purpose or purposes as the Board of
Directors shall think conducive to the interests of the
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corporation, and the Board of Directors may modify or abolish any such reserve
in the manner in which it was created.
Section 2. Annual Statements. The Board of Directors shall
present at each annual meeting, and at any special meeting of the stockholders
when called for by vote of the stockholders, a full and clear statement of the
business and condition of the corporation.
Section 3. Checks. All checks or demands for money and notes of
the corporation. shall be signed by such officer or officers or such other
person or persons as She Board of Directors may from time to time designate.
Section 4. Fiscal Year. The fiscal year of the corporation shall
be designated by resolution of the Board of Directors.
Section 5. Indemnification. The corporation shall have the power
to indemnify its officers, directors, employees and agents of the Corporation,
and such other persons as designated by the Board of Directors, to the full
extent as permitted under the laws of she State of Delaware.
Section 6. Seal. The corporate seal shall have inscribed thereon
the name of the corporation, the year of its organization, and the name of the
State of Delaware. The seal may be used by causing it or a facsimile thereof to
be impressed, affixed or otherwise reproduced.
Section 7. Amendments. Unless such power is reserved to the
stockholders by statute, the Certificate of Incorporation or these Bylaws,
these Bylaws may be altered, amended or repealed or new Bylaws adopted either
by the stockholders or the Board of Directors (when such power is conferred
upon the Board of Directors by the Certificate of Incorporation, and subject to
repeal or change by action of the stockholders) at any annual meeting of the
stockholders or regular meeting of the Board of Directors, or at any special
meeting of the stockholders or the Board of Directors (if notice of such
alteration, amendment, repeal or adoption of new Bylaws is contained in the
notice of such special meeting), by a vote of a majority of the holders of
stock having voting power present in person or represented by proxy at such
meeting at which there is a quorum, or by a vote of a majority of the directors
present at such meeting at which there is a quorum (whichever is applicable).
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ANNEX 3-B
333
BYLAWS
OF
▇▇▇▇▇▇ COMMUNICATIONS UNRESTRICTED HOLDINGS, INC.
ARTICLE I
OFFICES
Section 1. The registered office shall be located at
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 2. The corporation may also have offices at such
other places both within and without the State of Delaware and the United
States as the Board of Directors may from time to time determine or as the
business of the corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. All annual meetings of the stockholders for the
election of directors shall be held at such place either within or without the
State of Delaware or the United States, as shall be designated from time to
time by the Board of Directors and stated in the notice of the meeting or in a
duly executed waiver of the notice thereof. Meetings of stockholders for any
other purpose may be held at such time and place, within or without the State
of Delaware or the United States, as shall be stated in the notice of the
meeting or in a duly executed waiver of notice thereof.
Section 2. Annual meetings of the stockholders shall be held on
such date and at such time as shall be designated from time to time by the
Board of Directors. At the annual meeting, the stockholders shall elect the
Board of Directors and shall transact such other business as may properly be
brought before the meeting.
Section 3. Written notice of the annual meeting stating the
place, date and time of the meeting shall be given not less than ten (10) nor
more than sixty (60) days before the date of the meeting to each stockholder
entitled to vote at such meeting.
Section 4. Special meetings of the stockholders for any purpose
or purposes, unless otherwise provided by statute, the Certificate of
Incorporation or these Bylaws, may be called by the President and shall be
called by the President or Secretary at the request in writing of a majority of
the Board of Directors or at the request in writing of stockholders owning a
majority of the entire capital stock of the corporation issued and outstanding
and entitled to vote. Such requests shall state the purpose or purposes of the
proposed meeting.
334
Section 5. Written notice of a special meeting shall state the
place, date and time of the meeting and the purpose or purposes for which the
meeting is called and shall be given not less than ten (10) nor more than sixty
(60) days before the date of the meeting to each stockholder entitled to vote
at such meeting.
Section 6. Business transacted at any special meeting of the
stockholders shall be limited to the purpose or purposes stated in the notice,
unless the holders of a majority of the issued and outstanding shares entitled
to vote otherwise consent thereto either at the special meeting or in writing
executed subsequent to the meeting,
Section 7. The officer who has charge of the stock ledger of the
corporation shall prepare and make, at least ten (10) days before every annual
or special meeting of the stockholders, a complete list of the stockholders
entitled to vote at the meeting, arranged in alphabetical order, showing the
address of each stockholder and the number of shares registered in the name of
each stockholder. Such list shall be open to examination by any stockholder for
any purpose germane to the meeting during ordinary business hours, and for a
period of at least ten (10) days prior to the meeting either at a place within
the city where the meeting is to be held (which place shall be specified in the
notice of the meeting) or (if not so specified) at the place where the meeting
is to be held. The list shall also be produced and kept at the time and place
of the meeting during the whole time thereof and may be inspected by any
stockholder who is present at the meeting.
Section 8. The holders of a majority of the issued and
outstanding shares entitled to vote thereat, who are present in person or
represented by proxy at the meeting, shall constitute a quorum at all annual
and special meetings of the stockholders for the transaction of business,
unless otherwise provided by statute, the Certificate of Incorporation or these
Bylaws. If, however, such quorum shall not be present or represented at any
meeting of the stockholders, the stockholders entitled to vote thereat, present
in person or represented by proxy, shall have the power to adjourn the meeting
from time to time, without notice other than announcement at the meeting, until
a quorum shall be present or represented. At such adjourned meeting, at which a
quorum shall be present or represented, any business may be transacted that
might have been transacted at the meeting as originally described in the notice
to the stockholders. If the adjournment is for more than thirty (30) days or
if after the adjournment a new record date is fixed for the adjourned meeting,
a notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.
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Section 9. When a quorum is present at any annual or special
meeting, the vote of the holders of a majority of the stock having voting power
present in person or represented by proxy at the meeting shall decide any
question brought before such meeting, unless the question is one upon which by
express provision of statute, the Certificate of Incorporation or these Bylaws
a different vote is required, in which case such express provision shall govern
and control the decision of such question.
Section 10. Unless otherwise provided by statute, the Certificate
of Incorporation or these Bylaws, each stockholder shall at every annual or
special meeting of the stockholders be entitled to one vote in person or by
proxy for each share of the capital stock having voting power held by such
stockholder, but no proxy shall be voted or acted upon after a period of three
years from its date, unless the proxy provides for a longer period.
Section 11. Unless otherwise provided by statute, the Certificate
of Incorporation or these Bylaws, any action required or permitted to be taken
at any annual or special meeting of the stockholders may be taken without a
meeting, without prior not ice and without a vote if a consent in writing,
setting forth the action so taken, is signed by the holders of outstanding
stock of the corporation having not less than the minimum number of votes that
would be necessary to authorize or take such action at a meeting at which all
shares entitled to vote thereon were present and voted. Such consent shall be
filed with the Secretary of the corporation. Prompt notice of the taking of the
corporate action without a meeting by less than unanimous written consent shall
be given to those stockholders who have not consented in writing.
ARTICLE III
DIRECTORS
Section 1. The number of directors that constitutes the Board of
Directors shall be at least one (1) and not more than ten (10). The first Board
of Directors shall initially consist of the number of directors as shall be
specified at the organizational meeting of the Corporation. Thereafter, within
the limits above specified, the number of directors shall be determined by
resolution of the Board of Directors or by the stockholders of the Common Stock
at the annual meeting. The directors shall be elected at the annual meeting of
the stockholders, except as provided in Section 2 of this Article. Each
director shall hold office until his successor is elected and qualified.
Directors need not be stockholders.
Section 2. Vacancies and newly created directorships resulting
from any increase in the authorized number of directors may be filled by a
majority of the directors then in office, though less than a quorum, or by a
sole remaining director. The
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directors so chosen shall hold office until the next annual election and until
their successors are duly elected and qualified, unless sooner displaced. If
there are no directors in office, then an election of directors may be held
in the manner provided by statute.
Section 3. The business of the corporation shall be managed by
its Board of Directors, which may exercise all such powers of the corporation
and do all such lawful acts and things as are not by statute, the Certificate
of Incorporation or these Bylaws directed or required to be exercised or done
by the stockholders.
ARTICLE IV
MEETINGS OF THE BOARD OF DIRECTORS
Section 1. The Board of Directors of the corporation may hold
meetings, both regular and special, either within or without the State of
Delaware or the United States.
Section 2. The first meeting of each newly elected Board of
Directors shall be held at such time and place as shall be fixed by the vote of
the stockholders at the annual meeting. No notice of such meeting to the newly
elected directors shall be necessary in order legally to constitute the
meeting, provided a quorum shall be present. If the stockholders fail to fix
the time or place of the first meeting of the newly elected Board of Directors
or if this meeting is not held at the time and place so fixed by the
stockholders, the meeting may be held at such time and place as shall be
specified in a notice given as hereinafter provided for special meetings of the
Board of Directors or as shall be specified in a written waiver signed by all
of the directors.
Section 3. Regular meetings of the Board of Directors may be
held without notice at such time and place as shall from time to time be
determined by the Board of Directors.
Section 4. Special meetings of the Board of Directors may be
called by the President on three (3) days notice to each director, either
personally, by mail, by telegram or by telecopy. Such meetings shall be called
by the President or Secretary in like manner and on like notice on the written
request of a majority of the directors.
Section 5. At all regular and special meetings of the Board of
Directors, a simple majority of the directors shall constitute a quorum for the
transaction of business, and the act of a majority of the directors present at
any meeting at which there is a quorum shall be the act of the Board of
Directors, unless otherwise specifically provided by statute, the Certificate
of Incorporation or these Bylaws. If a quorum is not present at any
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meeting of the Board of Directors the directors present thereat may adjourn the
meeting from time to time, without notice other than an announcement at the
meeting, until a quorum shall be present.
Section 6. Unless otherwise provided by statute, the Certificate
of Incorporation or these Bylaws, any action required or permitted to be taken
at any meeting of the Board of Directors or of any committee thereof may be
taken without a meeting if all members of the Board or the committee, as the
case may be, consent thereto in writing, and the writing or writings are filed
with the minutes of the proceedings of the Board of Directors.
ARTICLE V
COMMITTEES OF DIRECTORS
Section 1. The Board of Directors may, by resolution passed by a
majority of the whole Board, designate one or more committee, each consisting
of two or more directors of the corporation. The Board may designate one or
more directors as alternate members of any committee, who may replace any
absent or disqualified member at any meeting of the committee. In the absence
or disqualification of a member of a committee, the member or members thereof
present at any meeting and not disqualified from voting, whether or not he or
they constitute a quorum, may unanimously appoint another member of the Board
of Directors to act at the meeting in the place of any such absent or
disqualified member.
Section 2. Except as provided below, any committee, to the
extent provided in the resolutions of the Board of Directors and in these
Bylaws, shall have and may exercise all of the powers and authority of the
Board of Directors in the management of the business and affairs of the
corporation, and may authorize the seal of the corporation to be affixed to all
papers that may require it. No committee, however, shall have the power or
authority to amend the Certificate of Incorporation; to adopt an agreement of
merger or consolidation; to recommend to the stockholders the sale, lease,
exchange or other disposition of all or substantially all of the corporation's
property and assets; to recommend to the stockholders a dissolution of the
corporation or a revocation of a dissolution; or to amend these Bylaws;
further, unless a resolution of the Board of Directors, these Bylaws, or the
Certificate of Incorporation expressly so provides, no committee shall have the
power or authority to declare a dividend, to authorize the issuance of stock,
or to adopt a certificate of ownership and merger.
Section 3. A committee or committees shall have such name or
names as may be determined from time to time by resolution adopted by the Board
of Directors.
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Section 4. Each committee shall keep regular minutes of its
meetings and shall file them with the minutes of the proceedings of the Board
of Directors when required.
ARTICLE VI
COMPENSATION OF DIRECTORS
Section 1. Unless otherwise provided by statute, the Certificate
of Incorporation or these Bylaws, the Board of Directors shall have the
authority to fix the compensation of the directors.
Section 2. The directors may be paid their expenses, if any, of
attending meetings of the Board of Directors. Such payments may take the form
of a fixed sum for attendance at each meeting or a stated salary as a director.
Members of committees may be allowed like compensation for attending committee
meetings.
Section 3. No payment permitted under this Article VI shall
preclude any director from serving the corporation in any other capacity and
receiving compensation therefor.
ARTICLE VII
OFFICERS
Section 1. The officers of the corporation shall be chosen by
the Board of Directors and shall be a Chairman, a President, a Secretary and a
Treasurer. The Board of Directors may also choose additional Vice Presidents,
and one or more Assistant Secretaries and Assistant Treasurers. Any number of
offices may be held by the same person, unless otherwise provided by statute,
the Certificate of Incorporation or these Bylaws.
Section 2. The officers of the corporation shall be elected by
the Board of Directors at the Board's first meeting after each annual meeting of
stockholders.
Section 3. The officers of the corporation shall hold office
until their successors are chosen and qualified. Any officer elected or
appointed by the Board of Directors may be removed at any time by the
affirmative vote of a majority of the Board of Directors whenever in its
judgment the best interests of the corporation will be served thereby. Any
vacancy occurring in any office of the corporation shall be filled by the Board
of Directors.
Section 4. The salaries of all officers and agents of the
corporation shall be fixed by the Board of Directors.
Section 5. The Chairman shall be the Chief Executive Officer of
the corporation, shall preside at all meetings of the
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shareholders and the Board of Directors, shall have general and active
management of the business of the corporation and shall see that all orders and
resolutions of the Board of Directors are carried into effect. He shall execute
bonds, mortgages and other contracts requiring a seal, under the seal of the
corporation, except where required or permitted by law to be otherwise signed
and executed and except where the signing and execution thereof shall be
expressly delegated by the Board of Directors to some other officer or agent of
the corporation.
Section 6. The President, subject to the Chairman, shall be the
Chief Operating Officer of the corporation, in the absence of the President
shall preside at all meetings of the shareholders and the Board of Directors,
shall have general and active management of the business of the corporation and
shall see that all orders and resolutions of the Board of Directors are carried
into effect. He shall execute bonds, mortgages and other contracts requiring a
seal, under the seal of the corporation, except where required or permitted by
law to be otherwise signed and executed and except where the signing and
execution thereof shall be expressly delegated by the Board of Directors to
some other officer or agent of the corporation.
Section 7. In the absence of the President or in the event of
his inability or refusal to act, the Vice President (or in the event there are
more than one, the Vice Presidents in the order designated, or in the absence
of any designation, then in the order of their election) shall perform the
duties of the President and, when so acting, shall have all the powers of and
be subject to all the restrictions upon the President. The Vice President shall
perform such other duties and have such other powers as the Board of Directors
may from time to time prescribe.
Section 8. The Secretary shall attend all meetings of the Board
of Directors and all meetings of the stockholders and record all of the
proceedings of the meetings of the corporation and of the Board of Directors in
a book to be kept for that purpose and shall perform like duties for any
committees when required. The Secretary shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the Board of
Directors and shall perform such other duties as may be prescribed by the Board
of Directors or the President, under whose supervision he shall be. The
Secretary shall have custody of the corporate seal of the corporation, and he,
or an Assistant Secretary, shall have the authority to affix the same to any
instrument requiring it, and (when so affixed) it may be attested by his
signature or by the signature of such Assistant Secretary. The Board of
Directors may give general authority to any other officer to affix the seal of
the corporation and to attest the affixing by his signature.
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Section 9. The Assistant Secretary, or if there are more than
one, the Assistant Secretaries in the order determined by the Board of
Directors (or if there is no such determination, then in the order of their
election), shall, in the absence of the Secretary or in the event of his
inability or refusal to act, perform the duties and exercise the powers of the
Secretary and shall perform such other duties and have such other powers as the
Board of Directors may from time to time prescribe.
Section 10. The Treasurer shall have custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation and shall deposit all
moneys and other valuable effects in the name and to the credit of the
corporation in such depositories as may be designated by the Board of
Directors.
Section 11. The Treasurer shall disburse the funds of the
corporation as may be ordered by the Board of Directors, taking proper vouchers
for such disbursements, and shall render to the President, and the Board of
Directors at the Board's regular meetings or when the Board so requires, an
account of all his transactions as Treasurer and of the financial condition of
the corporation.
Section 12. If required by the Board of Directors, the Treasurer
shall give the corporation a bond (which shall be renewed every six years) in
such sum and with such surety or sureties as shall be satisfactory to the Board
of Directors for the faithful performance of the duties of his office and for
the restoration to the corporation, in case of his death, resignation,
retirement or removal from office, of all books, papers, vouchers, money and
other property of whatever kind in his possession or under his control
belonging to the corporation.
Section 13. The Assistant Treasurer, or if there are more than
one, the Assistant Treasurers in the order determined by the Board of Directors
(or if there is no such determination, then in the order Of their election),
shall, in the absence of the Treasurer or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the Treasurer and
shall perform such other duties and have such other powers as the Board of
Directors may from time to time prescribe.
ARTICLE VIII
NOTICES
Section 1. Whenever, under the provisions of the statute, the
Certificate of Incorporation or these Bylaws, notice is required to be given to
any director or stockholder, it shall not be construed to mean solely personal
notice, but such notice may be given in writing by mail addressed to such
director or stockholder at his address as it appears on the records of the
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corporation with postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same is deposited in the United States mail. Notice
to directors may also be given by telegram.
Section 2. Whenever any notice is required to be given under the
provisions of statute, the Certificate of Incorporation or these Bylaws, a
waiver thereof in writing, signed by the person or persons entitled to said
notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
ARTICLE IX
CERTIFICATES OF STOCK
Section 1. Every holder of stock in the corporation shall be
entitled to have a certificate, signed by the Chairman or Vice Chairman of the
Board of Directors, or the President or a Vice President, and by the Secretary
or an Assistant Secretary, or the Treasurer or an Assistant Treasurer,
certifying the number of shares owned by the stockholder in the corporation.
Section 2. Any or all of the signatures on the certificate may
be a facsimile if the certificate is manually signed on behalf of a transfer
agent or a registrar (other than the corporation itself or an employee of the
corporation). In case any officer, transfer agent or registrar who has signed
or whose facsimile signature has been placed upon a certificate shall have
ceased to be such officer, transfer agent or registrar before such certificate
is issued, the certificate may be issued by the corporation with the same
effect as if he were such officer, transfer agent or registrar at the date of
issue.
Section 3. The Board of Directors may direct that a new
certificate or certificates be issued in place of any certificate or
certificates theretofore issued by the corporation alleged to have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate to be lost, stolen or destroyed. When authorizing
such issue of a new certificate or certificates, the Board of Directors may, in
its discretion and as a condition precedent to the issuance thereof, require
the owner of such lost, stolen or destroyed certificate or certificates or his
legal representative to advertise the same in such manner as it shall require
and/or to give the corporation a bond in such sum as it may direct as indemnity
against any claim that may be made against the corporation with respect to the
certificate alleged to have been lost, stolen or destroyed.
Section 4. Upon surrender to the corporation or the transfer
agent of the corporation of a certificate for shares duly endorsed or
accompanied by the proper evidence of
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succession, assignment or authority to transfer, the corporation shall issue a
new certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its books.
Section 5. In order that the corporation may determine the
stockholders entitled to notice of or to vote at any meeting of the
stockholders or any adjournment thereof, or entitled to express consent to
corporate action in writing without a meeting, or entitled to receive payment
of any dividend or other distribution or allotment of any rights, or entitled
to exercise any rights in respect of any change, conversion or exchange of
stock or for the purpose of any other lawful action, the Board of Directors may
fix, in advance, a record date that shall not be more than sixty (60) nor less
than ten (10) days before the date of such meeting, nor more than sixty (60)
days prior to any other action. A determination of stockholders of record
entitled to notice of or to vote at a meeting of stockholders shall apply to
any adjournment of the meeting; provided, however, that the Board of Directors
may fix a new date for the adjourned meeting.
Section 6. The corporation shall be entitled to recognize the
exclusive rights of a person registered on its books as the owner of shares to
receive dividends and to vote as such owner. The corporation shall be entitled
to hold liable for calls and assessments a person registered on its books as
the owner of shares. The corporation shall not be bound to recognize any
equitable or other claim to or interest in such share or shares on the part of
any other person, regardless of whether the corporation shall have express or
other notice thereof, unless otherwise provided by statute, the Certificate of
Incorporation or these Bylaws.
ARTICLE X
GENERAL PROVISIONS
Section 1. Dividends. Dividends upon the capital stock of the
corporation, unless otherwise provided by statute, the Certificate of
Incorporation or these Bylaws, may be declared by the Board of Directors at any
regular or special meeting, pursuant to law. Dividends may be paid in cash,
property, or in shares of stock, unless otherwise provided by statute, the
Certificate of Incorporation or these Bylaws. Before payment of any dividend,
there may be get aside out of any funds of the corporation available for
dividends such sum or sums as the Board of Directors from time to time, in
their absolute discretion, may think proper as a reserve or reserves for
contingencies, equalizing dividends, repairing or maintaining any property of
the corporation, or for such other purpose or purposes as the Board of
Directors shall think conducive to the interests of the corporation, and the
Board of Directors may modify or abolish any such reserve in the manner in
which it was created.
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Section 2. Annual Statements. The Board of Directors shall
present at each annual meeting, and at any special meeting of the stockholders
when called for by vote of the stockholders, a full and clear statement of the
business and condition of the corporation.
Section 3. Checks. All checks or demands for money and notes of
the corporation shall be signed by such officer or officers or such other
person or persons as the Board of Directors may from time to time designate.
Section 4. Fiscal Year. The fiscal year of the corporation shall
be designated by resolution of the Board of Directors.
Section 5. Indemnification. The corporation shall have the power
to indemnify its officers, directors, employees and agents of the Corporation,
and such other persons as designated by the Board of Directors, to the full
extent as permitted under the laws of the State of Delaware.
Section 6. Seal. The corporate seal shall have inscribed thereon
the name of the corporation, the year of its organization, and the name of the
State of Delaware. The seal may be used by causing it or a facsimile thereof to
be impressed, affixed or otherwise reproduced.
Section 7. Amendments. Unless such power is reserved to the
stockholders by statute, the Certificate of Incorporation or these Bylaws,
these Bylaws may be altered, amended or repealed or new Bylaws adopted either
by the stockholders or the Board of Directors (when such power is conferred
upon the Board of Directors by the Certificate of Incorporation, and subject to
repeal or change by action of the stockholders) at any annual meeting of the
stockholders or regular meeting of the Board of Directors, or at any special
meeting of the stockholders or the Board of Directors (if notice of such
alteration, amendment, repeal or adoption of new Bylaws is contained in the
notice of such special meeting), by a vote of a majority of the holders of
stock having voting power present in person or represented by proxy at such
meeting at which there is a quorum, or by a vote of a majority of the directors
present at such meeting at which there is a quorum (whichever is applicable).
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