Document/Exhibit Description Pages Size
1: 10-Q Paxson Communications, Inc. Form 10-Q 21 142K
13: EX-10.100 Asset Purchase Agreement 40 175K
14: EX-10.101 Asset Purchase Agreement 41 177K
15: EX-10.102 Asset Purchase Agreement 45 190K
16: EX-10.103 Construction Agreement 9 37K
17: EX-10.104 Loan Agreement 29 120K
18: EX-10.105 Asset Purchase Agreement 44 184K
19: EX-10.106 Asset Purchase Agreement 42 176K
20: EX-10.107 Agreement and Plan of Merger 34 110K
21: EX-10.107.01 First Amendment to Agreement and Plan of Merger 3 17K
22: EX-10.108 Asset Purchase Agreement 41 174K
23: EX-10.109 Option Agreement 9 35K
24: EX-10.110 Subordinated Note 13 50K
25: EX-10.111 Asset Purchase Agreement 40 142K
26: EX-10.112 Asset Purchase Agreement 40 169K
27: EX-10.113 Time Brokerage Agreement 28 96K
28: EX-10.114 Purchase Agreement 17 63K
29: EX-10.115 Asset Purchase Agreement 32 138K
30: EX-10.116 Asset Purchase Agreement 32 148K
31: EX-10.117 Asset Purchase Agreement 32 144K
32: EX-10.118 Asset Purchase Agreement 33 147K
33: EX-10.119 Time Brokerage Agreement 16 70K
34: EX-10.120 Loan Agreement 28 109K
35: EX-10.121 Second Amendment to Asset Purchase Agreement 6 22K
36: EX-10.122 Asset Purchase Agreement 41 180K
37: EX-10.123 Asset Purchase Agreement 94 303K
38: EX-10.124 Loan Agreement 52 170K
39: EX-10.125 Time Brokerage Agreement 28 98K
40: EX-10.126 Option Agreement 18 64K
2: EX-10.89 Amended as Restated Promissory Note 6 25K
3: EX-10.90 First Anemdment to Loan Agreement 2 15K
4: EX-10.91 Asset Purchase Agreement 15 73K
5: EX-10.92 Asset Purchase Agreement 41 174K
6: EX-10.93 The Brokerage Agreement 29 97K
7: EX-10.94 Asset Purchase Agreement 38 173K
8: EX-10.95 First Amendment 2 15K
9: EX-10.96 Promissory Note 4 21K
10: EX-10.97 Stock Purchase Agreement 42 199K
11: EX-10.98 Asset Purchase Agreement 42 178K
12: EX-10.99 Asset Purchase Agreement 42 177K
41: EX-27 Financial Data Schedule (For SEC Use Only) 1 12K
EXHIBIT 10.120
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LOAN AGREEMENT
BY AND BETWEEN
PAXSON COMMUNICATIONS OF
MILWAUKEE-55, INC.
AND
CHANNEL 55 OF MILWAUKEE, INC.
FOR
TELEVISION STATION WHKE-TV
KENOSHA, WISCONSIN
* * *
JULY 9, 1996
============================================================================
TABLE OF CONTENTS
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ARTICLE I. AMOUNT AND TERMS OF THE LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 The Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2 The Promissory Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.3 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.4 Repayment of the Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.5 Use of Proceeds and Advancement of Funds . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.6 Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.7 Prepayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.8 Payment on Non-Business Days . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE II. CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.1 Closing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ARTICLE III. SECURITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 3.1 Security Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 3.2 Pledge Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 3.3 Leasehold Mortgages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 3.4 Mortgages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE IV. CONDITIONS OF LENDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 4.1 Conditions Precedent to Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 4.2 Conditions Precedent to Final Installment . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4.3 Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ARTICLE V. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 5.1 Representations and Warranties of Borrower . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE VI. COVENANTS OF THE BORROWER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 6.1 Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 6.2 Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 6.3 Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE VII. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 7.1 Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 7.2 Effect of Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE VIII. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 8.1 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 8.2 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
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Section 8.3 Conflicts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 8.4 Address for Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 8.5 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 8.6 Binding Effect; Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 8.7 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 8.8 Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 8.9 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 8.10 Rights Affected by Extensions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 8.11 Survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 8.12 FCC Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 8.13 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 8.14 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 8.15 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 8.16 Maximum Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE IX. GUARANTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 9.1 Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 9.2 Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 9.3 Limited Recourse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
LIST OF EXHIBITS
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Exhibit 1 -- Promissory Note
Exhibit 2 -- Security Agreement
Exhibit 3 -- Pledge Agreement
Exhibit 4 -- Mortgage
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LOAN AGREEMENT
THIS LOAN AGREEMENT, dated as of this 9th day of July, 1996, is by
and between PAXSON COMMUNICATIONS OF MILWAUKEE-55, INC., a Florida corporation
having its principal offices at 601 Clearwater Park Road, West Palm Beach, FL
33401 (the "Lender"), and CHANNEL 55 OF MILWAUKEE, INC., a Florida corporation
having its principal offices at 14444 66th Street North, Clearwater, Florida
34624 (the "Borrower").
W I T N E S S E T H:
WHEREAS, the Borrower is purchasing substantially all of the assets
and properties, including all broadcast licenses issued by the Federal
Communications Commission ("FCC Licenses") and other governmental authorities,
of Television Station WHKE-TV, Kenosha, Wisconsin (the "Station");
WHEREAS, the Lender is willing to lend the Borrower sufficient funds
to acquire the Station on which Lender will provide programming pursuant to a
Time Brokerage Agreement;
WHEREAS, the Borrower and Lender have entered into an Option Agreement
dated as of the date hereof pursuant to which the Borrower has granted to the
Lender an exclusive and irrevocable option to acquire the assets of the Station
upon the terms and conditions specified therein (the "Option Agreement"); and
WHEREAS, the Borrower desires to borrow funds from the Lender to
finance the purchase and operation of the Station.
NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained, the Lender and the Borrower agree as follows:
ARTICLE I . AMOUNT AND TERMS OF THE LOANS
Section 1.1 The Loan. The Lender agrees, upon the terms
and conditions hereinafter set forth, to make a loan or loans to the Borrower
in an aggregate principal amount not to exceed at any one time outstanding Six
Million Dollars ($6,000,000.00) plus such additional amounts that are
reasonably requested by Borrower for the purposes set forth in Section 1.5 and
are approved by Lender in its sole discretion (the "Loan").
Section 1.2 The Promissory Note. The outstanding
principal amount of the Loan shall be evidenced by and subject to the terms of
a promissory note, dated of even date herewith, substantially in the form set
forth as Exhibit 1 hereto (as amended, renewed, restated, increased,
consolidated or substituted from time to time, the "Note") payable
to the
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order of the Lender and representing the obligation of the Borrower to pay
the Lender the amount of the Loan, with interest thereon, as prescribed in
Section 1.4. All references to the "Note" in this Loan Agreement, the Security
Agreement, the Pledge Agreement, each Leasehold Mortgage or Mortgage (each as
defined in this Loan Agreement) and in such other agreements and documents
executed and delivered in connection with this Loan Agreement shall be deemed to
be references to the Note referred to in this Section.
Section 1.3 Interest. The Loan shall bear interest on
the unpaid principal amount thereof at a rate per annum equal to the Prime
Commercial Rate announced or published by Sun Bank of Tampa Bay to be adjusted
monthly as and when such rate is adjusted. Interest shall be calculated on the
basis of a year of three-hundred and sixty (360) days and the actual number of
days elapsed during the period for which such interest is payable. Interest
shall begin to accrue on the outstanding principal amount of the Loan on the
date of disbursement of all or a portion of the Final Installment (as defined
below) pursuant to Section 1.5(b) (the "Final Installment Date"). The first
payment of interest to the Lender shall be due thirty (30) days after the
acquisition of the Station by the Borrower pursuant to Federal Communications
Commission ("FCC") authority, at which time all interest accrued from the Final
Installment Date shall become due and payable. Thereafter, accrued interest
shall be paid monthly on or before the first day of each month until all
principal and interest hereunder is paid in full and at the repayment or
maturity of the Loan. If any installment of principal or interest is not paid
when due, that installment shall bear interest at a rate per annum equal to the
lower of the highest rate permitted by law or eighteen percent (18%) from the
date due thereof until paid in full.
Section 1.4 Repayment of the Loan. In the event that any
portion of the Loan is used by the Borrower to fund an escrow deposit or
similar payment toward the purchase of the Station (the "Deposit"), and such
Deposit is returned to the Borrower, the amount of such Deposit shall be
immediately repaid to Lender, together with all interest earned on such Deposit
and paid to the Borrower. In the event that the Borrower does not acquire the
Station, Borrower shall repay to Lender the outstanding principal amount of the
Loan no later than one-hundred eighty (180) days after such other party
acquires the Station. The principal amount of the Loan plus any accrued and
unpaid interest shall be due and payable on the first day of the 84th month
following the acquisition of the Station by the Borrower (the "Term Date"). In
the event of a termination of the Time Brokerage Agreement dated as of July
9, 1996, between Borrower and Lender, Borrower shall, in addition to payments
of interest required under Section 1.3 hereof, repay the outstanding principal
balance of the Loan in consecutive, equal monthly installments commencing on
the first day of the month following such termination (the "Amortization
Commencement Date") and ending on the Term Date, with each such monthly
principal installment payment equal to (x) the principal amount of the Loan
outstanding hereunder as of the first day of the month following such
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termination divided by (y) the total number of consecutive months included in
the period commencing on the Amortization Commencement Date, through and
including the Term Date.
Section 1.5 Use of Proceeds and Advancement of Funds.
(a) The proceeds of the Loan are to be used by the Borrower
exclusively for financing the purchase of the Station and for working capital
and operating expenses relating to the Station.
(b) The Lender shall loan to the Borrower the funds
required to acquire the Station, less the Deposit (the "Final Installment"), at
the closing of the acquisition of the Station, following final and
nonappealable FCC approval of the assignment of the FCC Licenses of the Station
to the Borrower.
Section 1.6 Information. The Borrower agrees to furnish to the
Lender such information as the Lender may reasonably request in connection with
the Loan or the Station.
Section 1.7 Prepayment. The Borrower may prepay the Note in whole at
any time, or from time to time in part, with accrued interest to the date of
prepayment on the amount prepaid, without penalty, provided that each payment,
other than that for the full amount of the outstanding balance, shall be in the
amount of Ten Thousand Dollars ($10,000.00) or an integral multiple thereof,
provided, however, that if any such prepayment is made within three years of the
Borrower's acquisition of the Station, Borrower shall reimburse Lender for any
prepayment penalty imposed on Lender or its affiliates under their debt
agreements or instruments as a result of Borrower's prepayment. Each prepayment
on the Note shall be applied to installments of principal payable on the Note in
the inverse order of maturity.
Section 1.8 Payment on Non-Business Days. Whenever any payment to be
made hereunder or under the Note shall become due on a Saturday, Sunday or
public holiday, such payment may be made on the next succeeding business day,
and such extension of time in such case shall be included in the computation of
interest hereunder and under the Note.
ARTICLE II. CLOSING
Section 2.1 Closing Date. Closing of this transaction shall occur
on a date agreed upon by the parties hereto (the "Closing Date").
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ARTICLE III. SECURITY
Section 3.1 Security Interest. As security for the Loan, the
Borrower shall execute and deliver to the Lender, on or before the Closing Date,
a security agreement in the form of Exhibit 2 hereto (the "Security Agreement").
Section 3.2 Pledge Agreement. As further security for
the Loan, on or before the Closing Date, the Borrower shall deliver to the
Lender a pledge agreement in the form of Exhibit 3 hereto, duly executed by The
Christian Network, Inc. (the "Shareholder"), the sole shareholder of the
Borrower (the "Pledge Agreement").
Section 3.3 Leasehold Mortgages. If requested by Lender,
at such time as the Borrower enters into or assumes the Lessee's interest under
any lease, it shall execute with respect to such lease a leasehold mortgage
substantially in the form of Exhibit 4 hereto (a "Leasehold Mortgage"),
granting the Lender a lien on its leasehold interest under such lease. In
particular, and without limiting the generality of the foregoing, if requested
by Lender, the Borrower shall execute a Leasehold Mortgage with respect to each
lease, if any, that it assumes as part of the acquisition of the Station. If
requested by Lender, the Borrower shall also deliver to the Lender with respect
to any lease to which the Borrower becomes a party one or more of the following
documents, each of which shall be in form and substance satisfactory to the
Lender: (i) evidence of the filing of the lease or a memorandum of lease, (ii)
an estoppel certificate executed by the landlord under such lease or any
sublessee, (iii) an executed landlord's consent and waiver, (iv) fixture filing
UCC-1 financing statements, (v) copies of such lease and any sublease, (vi)
executed tenant subordination agreements, (vii) a title encumbrance report with
respect to the real property subject to such lease, and (viii) any other
document required by applicable law to create or perfect a mortgage lien with
respect to such lease or reasonably required by the Lender.
Section 3.4 Mortgages. At such time as the Borrower
acquires any parcel of real estate, the Borrower shall execute a first mortgage
or deed of trust in favor of the Lender on such parcel, in form and substance
acceptable to Lender (a "Mortgage"). If requested by Lender, the Borrower
shall also deliver to the Lender with respect to such property one or more of
the following documents, each of which shall be in form and substance
satisfactory to the Lender: (i) fixture filing UCC-1 financing statements,
(ii) copies of any lease relating to such property, if any, (iii) executed
tenant subordination agreements and estoppel certificates, if applicable, (iv)
a survey of such real property, (v) a mortgagee title insurance policy, with
such coverage and with such endorsements, including, without limitation, usury,
first loss, last dollar, revolving credit, variable rate, doing business,
zoning comprehensive, contiguity (as applicable) and survey, to the extent
available in the state where the property is located, as the Lender may
require, and (vi) any other document required by applicable law
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to create or perfect a mortgage lien with respect to such property or
reasonably required by the Lender.
ARTICLE IV. CONDITIONS OF LENDING
Section 4.1 Conditions Precedent to Loan. The obligation
of the Lender to disburse from time to time any portion of the Loan hereunder
is subject to the condition precedent that the Lender shall have received all
of the following, on or before the Closing Date, in form and substance
satisfactory to the Lender:
(a) The Note, duly executed and delivered by the Borrower;
(b) The Security Agreement, together with appropriate UCC-1
forms and, if applicable, landlord lien waivers, duly executed and delivered by
the Borrower;
(c) The Pledge Agreement, duly executed and delivered by
the Shareholder together with stock certificates and blank stock powers;
(d) Certified copies of the resolutions of (i) the Board of
Directors of Borrower evidencing approval of the execution, delivery and
performance of this Agreement, the Note and the Security Agreement and other
matters contemplated hereby, and (ii) the Board of Stewards of Shareholder
evidencing approval of the execution, delivery and performance of this Loan
Agreement and the Pledge Agreement;
(e) A Certificate of Good Standing for the Borrower and
Shareholder;
(f) A copy of the Asset Purchase Agreement dated as of March
31, 1995, between Borrower and LeSea Broadcasting Corporation (the "Purchase
Agreement"), pursuant to which Borrower is purchasing the Station;
(g) Copies of UCC, judgment and tax lien searches in each
jurisdiction in which collateral covered by the Security Agreement is located,
naming the Borrower and the Seller of the Station as debtors;
(h) Such other agreements, certificates, opinions of
counsel and documents that the Lender may reasonably require; and
(i) The Option Agreement, duly executed and delivered by
the Borrower.
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Section 4.2 Conditions Precedent to Final Installment. The
obligation of the Lender to advance the Final Installment to the Borrower is
subject to the condition precedent that the Lender shall have received each of
the following, on or before the Final Installment Date, in form and substance
satisfactory to the Lender:
(a) With respect to each leased real property, the documents
required by Section 3.3, and with respect to each owned real property, the
documents required by Section 3.4;
(b) A Certificate of Good Standing for the Borrower in the
State of Florida as of a recent date prior to the Final Installment Date;
(c) Copies of the certificates evidencing the insurance
required to be maintained by the Borrower pursuant to Section 6.1(e);
(d) Evidence, in form and substance acceptable to Lender, that
Borrower has received the approval of the FCC to be the licensee of the Station
and that approval has become a final, non-appealable order no longer subject to
administrative or judicial review, reconsideration or appeal;
(e) A copy of the Purchase Agreement and each other contract,
certificate and other document executed by the Borrower or the seller of the
Station in connection with the Borrower's acquisition of the Station; and
(f) Such other agreements, certificates, opinions of counsel
and documents that the Lender may reasonably require.
Section 4.3 Compliance. All of the representations and warranties
of the Borrower and Shareholder in this Loan Agreement shall be true and
accurate in all material respects on and as of the Closing Date and the date of
any subsequent disbursement of any portion of the Loan, as if made on and as of
such date and time. The Borrower shall be in compliance with all of the
applicable terms and provisions of this Agreement and no Event of Default or any
event which with the lapse of any applicable grace period or the giving of
notice or both would constitute an Event of Default shall have occurred and be
continuing. The Borrower shall have performed all obligations and taken all
actions to be performed or taken by it hereunder on or prior to such date. On
the Closing Date, the Borrower and Shareholder shall deliver to the Lender a
certificate, dated as of such date and signed by an executive officer of the
Borrower and Shareholder, certifying compliance with the conditions of this
Section 4.3. Each disbursement of all or a portion of the Loan to the Borrower
shall in and of itself, constitute a representation and warranty that the
Borrower and Shareholder as of the
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date of such Loan, is in compliance with this Section and if the Borrower or
Shareholder is not in compliance with this Section, the Lender shall
not be required to disburse such Loan to the Borrower.
ARTICLE V. REPRESENTATIONS AND WARRANTIES
Section 5.1 Representations and Warranties of Borrower. In order to
induce the Lender to enter into this Agreement and make the Loan, Borrower
represents and warrants as follows:
(a) Existence and Standing. Borrower is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Florida and is qualified to do business and in good standing under the laws
of any other jurisdiction in which it conducts its business, and has all
requisite power and authority, corporate or otherwise, to conduct its business,
to own its properties and to execute and deliver, and to perform all of its
obligations under this Agreement, the Note, any Mortgage or Leasehold Mortgage,
the Security Agreement, the Option Agreement, and all other documents that have
been or will be executed and delivered by the Borrower pursuant to this
Agreement.
(b) Authorizations, Compliance with Laws. The execution,
delivery and performance by the Borrower of this Agreement, the Note, any
Mortgage or Leasehold Mortgage, the Security Agreement, the Option Agreement,
and all other documents required to be executed and delivered by the Borrower
pursuant to this Agreement have been duly authorized by all necessary corporate
action and do not and will not (i) violate (A) any provision of any law, rule,
regulation, order, writ, judgment, injunction, decree, determination or award
presently in effect having applicability to the Borrower or (B) any provision of
the charter or by-laws of the Borrower; or (ii) result in a breach of or
constitute a default under any agreement or instrument to which the Borrower is
a party or by which its properties may be affected; or (iii) result in the
creation of a lien, charge or encumbrance of any nature upon the Borrower's
properties or assets other than as contemplated by this Agreement.
(c) No Consent. No authorization, consent, approval, license,
exemption of or filing or registration with any court or governmental department
or agency, except for filing with the FCC, is or will be necessary to the valid
execution, delivery and performance by the Borrower of this Agreement, the Note,
any Mortgage or Leasehold Mortgage, the Security Agreement, the Option
Agreement, or any other document required to be executed and delivered by the
Borrower pursuant to this Agreement.
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(d) Binding Obligations. This Agreement, the Note, any Lease
hold Mortgage, any Mortgage, the Security Agreement, the Pledge Agreement and
all other documents required to be executed and delivered by the Borrower (or,
in the case of this Agreement and the Pledge Agreement, by the Shareholder)
pursuant to this Agreement have been or, on or prior to the Closing Date, will
be executed and delivered by duly authorized officers of the Borrower (or, in
the case of this Agreement and the Pledge Agreement, of the Shareholder) and
constitute or, on or prior to the Closing Date, will constitute, legal, valid
and binding obligations of the Borrower (or, in the case of this Agreement and
the Pledge Agreement, of the Shareholder) enforceable in accordance with their
respective terms.
(e) Litigation. There are no actions, suits or proceedings
pending, or, to the knowledge of the Borrower, threatened against or affecting
the Borrower or its properties before any court or governmental department or
agency which materially adversely affects the transactions contemplated by this
Agreement or which would have a material adverse effect on the business,
properties, prospects, operation or condition (financial or otherwise) of the
Borrower.
(f) No Default. The Borrower is not in default in the
performance, observance or fulfillment of any of the obligations or conditions
contained in any material agreement or instrument to which it is a party, nor
with respect to any order, judgment, writ, injunction or decree of any court,
governmental authority or arbitration board.
(g) Compliance with Laws. The Borrower has complied with all
applicable federal, state and local laws. The Borrower has obtained all
necessary licenses and permits required for the conduct of its business and
operations or such licenses and permits have been applied for and are now being
diligently pursued.
(h) Taxes. The Borrower has filed all tax returns and reports
(federal, state and local) required to be filed by it, and has paid all taxes
shown thereon, including interest and penalties, and all assessments received by
it (except to the extent that the same are being contested in good faith by
appropriate proceedings diligently prosecuted and as to which adequate reserves
have been set aside on the books of the Borrower in conformity with generally
accepted accounting principles).
(i) Title to Properties. The Borrower has good and
marketable title to all of its property and assets and valid and enforceable
leasehold interests in the property which it holds under lease, all such
property, assets and leasehold interests being free and clear of any and all
mortgages, deeds of trust, assignments, liens, security interests, charges or
encumbrances of any nature whatsoever, except for those created hereby, and no
mortgages, deeds of trust, financing statements or other evidences of security
interests covering all or
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any of the aforesaid property are on file among the records of any
public office, except those evidencing a security interest in favor of the
Lender.
(j) Material Misstatement. No statement made herein or
information, exhibit or report furnished by the Borrower to the Lender in
connection with this Agreement or its negotiation, contains any material
misstatement of fact or omits to state a material fact or any fact necessary
to make the foregoing not misleading.
ARTICLE VI. COVENANTS OF THE BORROWER
Section 6.1 Affirmative Covenants. So long as the Note shall remain
unpaid, the Borrower hereby covenants and agrees that it will, unless the
Lender shall otherwise consent in writing:
(a) Payment of Obligations. Pay punctually and discharge
when due: (i) all indebtedness heretofore or hereafter incurred; (ii) all taxes,
assessments and governmental charges or levies imposed upon it or its income or
profits, or upon any properties belonging to it; (iii) claims or demands of
materialmen, mechanics, carriers, warehousemen, landlords and other like persons
which, if unpaid might become a lien or charge upon the property of the
Borrower; provided that this covenant shall not require the payment of any of
the matters set forth in (i), (ii) and (iii) above if the same shall be
contested in good faith and by proper proceedings diligently pursued and as to
which adequate reserves have been set aside on the books of the Borrower in
accordance with generally accepted accounting principles.
(b) Preservation of Existence. Preserve and maintain its
respective corporate existence, rights, franchises and privileges in the
jurisdiction of its incorporation.
(c) Maintenance of Properties. Maintain and preserve all of
its properties necessary or useful in the proper conduct of its business in good
working order and condition, ordinary wear and tear excepted.
(d) Compliance with Laws. Comply in all material respects
with the requirements of all applicable laws, rules, regulations and orders of
any governmental authority.
(e) Maintenance of Insurance. Maintain with responsible and
reputable insurance companies policies on all of its properties and covering
such risks, including public liability and workers' compensation, in such
amounts as are usually carried by companies engaged in similar businesses and
owning similar properties as the Borrower, and promptly
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upon execution thereof provide to the Lender copies of all such policies
and any riders or amendments thereto. The policies of insurance required
hereunder shall name the Lender as an additional loss payee or additional
insured, as applicable, and shall provide that the Lender shall receive at least
thirty (30) days' written notice prior to the cancellation, termination or
alteration of any such policy.
(f) Operations in Ordinary Course. Continue to operate its
business in the ordinary course.
(g) Perfection of Liens. Do all things requested by the
Lender to preserve and perfect the liens and security interests of the Lender
arising pursuant to the Security Agreement, the Pledge Agreement, any Leasehold
Mortgage, any Mortgage or any other agreement required hereunder as first liens
and security interests.
(h) FCC Approval. If counsel to the Lender reasonably
determines that the consent of the FCC is required in connection with the
execution, delivery and performance of this Agreement, the Pledge Agreement, the
Security Agreement, any Mortgage or Leasehold Mortgage or any other document
delivered to the Lender in connection herewith or therewith or as a result of
any action which may be taken pursuant hereto or thereto, then the Borrower, at
its sole cost and expense, agrees to use its best efforts to secure such consent
and to cooperate with the Lender in any action commenced by the Lender to secure
such consent.
(i) Purchase Agreement. Comply with its obligations under
the Purchase Agreement.
Section 6.2 Negative Covenants. So long as the Note
shall remain unpaid and the Agreement shall not have been terminated, the
Borrower hereby covenants that it will not, without the Lender's prior written
approval:
(a) Indebtedness. Create or incur, assume or suffer to
exist any indebtedness, obligation or liability, whether matured or unmatured,
liquidated or unliquidated, direct or contingent, joint or several, except for:
(i) indebtedness evidenced by the Note; (ii) indebtedness (other than for
borrowed money) incurred in the ordinary course of business not to exceed Fifty
Thousand Dollars ($50,000.00) in the aggregate at any one time; (iii)
obligations or liabilities arising under the indemnification provisions of the
Purchase Agreement.
(b) Liens. Create, assume or suffer to exist, directly or
indirectly, any security interest, mortgage, deed of trust, pledge, lien,
charge or other encumbrance, of any
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nature whatsoever upon any of its properties or assets, now owned or
hereafter as acquired, excluding, however, from the operation of this covenant
with respect to property or assets other than the Stock (as defined in the
Pledge Agreement):
(i) any security interest or lien created pursuant to or
in connection with this Agreement or securing the Loan, the Security Agreement,
the Pledge Agreement, any Leasehold Mortgage or any Mortgage;
(ii) liens for taxes or assessments either not delinquent
or the validity of which are being contested in good faith by appropriate legal
or administrative proceedings and as to which adequate reserves shall have been
set aside on its books, in conformity with generally accepted accounting
principles;
(iii) materialmen's, mechanics', carriers', workmen's,
repairmen's, warehousemen's or other like liens arising in the ordinary course
of business and either not yet due and payable or being contested in good faith
by appropriate legal proceedings and as to which adequate reserves shall have
been set aside on its books, in conformity with generally accepted accounting
principles;
(iv) deposits or pledges to secure payment of workers'
compensation, unemployment insurance or other social security benefits or
obligations; or
(v) any judgment lien, singly or aggregated with other
judgment liens, in an amount less than $100,000, unless the judgment it secures
shall not, within thirty (30) days after the entry thereof, have been
discharged, vacated, reversed, or execution thereof stayed pending appeal, or
shall not have been discharged, vacated or reversed within thirty (30) days
after the expiration of any such stay.
(c) Disposition of Assets. Sell, transfer, lease or
otherwise dispose of any of its assets or properties other than sales of assets
in the ordinary course of business (which shall expressly not include any
transfer or assignment of any FCC License).
(d) Merger. Enter into any consolidation or merger with,
or into any acquisition of all or substantially all of the properties or assets
of any person or entity.
(e) Transfer or Issuance of Shares. Issue or permit the
transfer of any shares of the capital stock of the Borrower, or any options,
warrants, convertible securities or other rights to purchase the Borrower's
stock. The preceding sentence shall not apply to issuances or transfers to the
Lender.
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(f) Change of Business. Change, in any material respect,
the nature or character of its business as intended, or engage in any activity
not reasonably related to such business.
(g) Remove Assets. Remove any of the assets procured with
the proceeds of the borrowings provided for herein, or any replacements for such
assets, to a jurisdiction in which no financing statement on Form UCC-1 has been
filed by the Lender with respect to such assets.
(h) Distributions or Dividends. Declare or make, directly
or indirectly, any payment or distribution, or incur any liability for the
purchase, acquisition, redemption or retirement of any capital stock of the
Borrower or as a dividend, return of capital or other payment or distribution of
any kind to a shareholder of the Borrower or any affiliate of the Borrower
(other than any stock dividend or stock split or similar distribution payable
only in capital stock of the Borrower) in respect of the Borrower's capital
stock.
(i) Transactions with Affiliates. Enter into any
transaction or agreement with any affiliate of the Borrower.
(j) Contracts. Enter into any contract or commitment
relating to its stock or assets except for contracts involving aggregate
payments of less than Five Thousand Dollars ($5,000.00) and contracts which can
be terminated without penalty on thirty (30) days' notice or less, or amend or
terminate any material contract (or waive any substantial right thereunder), or
incur any obligation (including obligations relating to the borrowing of money
or guarantee of indebtedness).
(k) Adverse Change. Suffer any material adverse change in
the business, assets, properties, prospects or condition (financial or
otherwise) of the Borrower or the Station, or any damage, destruction or loss
affecting any assets used or useful in the conduct of the business of the
Borrower.
(l) Employee Compensation. Suffer any material increase in
excess of the reasonable range in the broadcast industry in the same or similar
markets in compensation payable or to become payable to any employees, or any
bonus payment made or promised to any employee, or any material change in
personnel policies, insurance benefits or other compensation arrangements
affecting any employees, provided that nothing in this clause shall be construed
to limit or restrict the commission compensation of employees who may be selling
brokered time for the Borrower.
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(m) Cancellation of Debts. Cancel any debts owed to or
claims held by the Borrower.
(n) Write-Down. Suffer any significant write-down of the
value of any assets or any significant write-off as uncollectible of any
accounts receivable without the prior written consent of the Lender
except and as required by generally accepted accounting principles as required
to present accurate financial information on the Borrower.
(o) Rights. Transfer or grant any right under, or enter
into any settlement regarding the breach or infringement of, any license,
patent, copyright, trademark, service mark, trade name, franchise, or similar
right, or modify any existing right relating to the Borrower.
(p) Television Affiliation Agreement. In the event
Borrower acquires the Station, terminate, amend or waive any provision of the
Television Affiliation Agreement (as defined in Section 7.1(d) below), if any,
to which the Station is a party.
(q) Purchase Agreement. Terminate, amend, commit any
material breach or default under or waive any term of the Purchase Agreement or
Option Agreement.
(r) Subsidiaries. Create or acquire any subsidiary of
Borrower, unless Lender shall have approved such action in advance and
Borrower shall have taken all actions required by Lender to grant Lender a
first priority security interest in all of the issued and outstanding stock of
such subsidiary. Borrower acknowledges and agrees that until such time as such
security interest is granted and perfected, Lender shall have an equitable lien
in the stock of any subsidiary created or acquired by Borrower.
Section 6.3 Reporting Requirements. So long as the Note shall remain
unpaid and the Agreement shall not have been terminated, the Borrower shall,
unless the Lender shall otherwise consent in writing, furnish to the Lender:
(a) Default Certificate. As soon as possible and in any event
within five (5) business days after the occurrence of each Event of Default (as
defined in Section 7.1) of which the Borrower has knowledge, the statement of
the President of the Borrower setting forth details of such Event of Default and
the action which the Borrower proposes to take with respect thereto.
(b) Financial Statements. Beginning with the making of the
Final Installment, quarterly financial statements within thirty (30) days after
the end of each fiscal quarter; within ninety (90) days after the end of each
fiscal year of the Borrower, a copy of
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the audited financial statements for such year for the Borrower, including
therein a balance sheet of the Borrower as of the end of such fiscal
year, statements of income and expense of the Borrower for such fiscal year, and
a statement of cash flow of the Borrower for such fiscal year, in each case
prepared by an independent public accountant of recognized standing acceptable
to the Lender, except that the Lender may waive the audit requirement and accept
a review of the Borrower's financial records.
(c) Notice of Litigation. Promptly give written notice of
all actions, suits and proceedings before any court or governmental agency,
domestic or foreign, which may be commenced or threatened against the Borrower
in which the claim involved is Five Thousand Dollars ($5,000.00) or more and of
any other matter of the type described in Section 5.1(e).
(d) Budget. An annual budget within thirty (30) days of
the beginning of each fiscal year of the Borrower. Such budget shall be
satisfactory in form and substance to the Lender.
(e) Other Information. Such other information respecting
the business, properties, operations or the condition, financial or otherwise,
of the Borrower as the Lender may from time to time reasonably request.
ARTICLE VII. EVENTS OF DEFAULT
Section 7.1 Events of Default. Under this Agreement, an Event of
Default shall be any of the following:
(a) The Borrower shall fail to pay any installment of
principal or interest on the Note, or any other obligation to the Lender when
due whether at the due date thereof or by acceleration or otherwise, and, in the
case of any installment of interest, such default shall remain unremedied for a
period of five (5) days; or
(b) The security interest or lien of the Lender in any
material portion of the collateral covered by the Security Agreement, Pledge
Agreement or any Leasehold Mortgage or Mortgage shall at any time not constitute
a legal, valid and enforceable security interest or lien; or
(c) Any representation or warranty made by the Borrower (or
any of its officers) herein, in the Security Agreement, any Leasehold Mortgage
or Mortgage or the Option Agreement, or by the Shareholder (or any of its
officers) herein or in the Pledge Agreement or in any certificate, agreement,
instrument or statement contemplated by or
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made or delivered pursuant to or in connection with this Agreement, the
Note, any Leasehold Mortgage or Mortgage, the Security Agreement the Option
Agreement, or the Pledge Agreement, shall prove to have been incorrect in any
material respect when made; or
(d) The Borrower shall fail to perform or observe any other
term, covenant or agreement contained in this Agreement, the Note, the Security
Agreement, any Leasehold Mortgage or Mortgage, the Option Agreement or any
Television Affiliation Agreement relating to the Station (the "Television
Affiliation Agreement"), or the Shareholder shall fail to perform or observe any
term, covenant or agreement contained in the Pledge Agreement, and any such
failure remains unremedied for thirty (30) days after written notice thereof
shall have been given to the Borrower by the Lender; or
(e) The Borrower or the Shareholder shall fail to pay any
indebtedness for borrowed money owing by the Borrower or the Shareholder or any
interest or premium thereon, when due, whether such indebtedness shall become
due by scheduled maturity, by required prepayment, by acceleration, by demand or
otherwise, or the Borrower or the Shareholder shall fail to perform any term,
covenant or agreement under any agreement or instrument evidencing or securing
or relating to any such indebtedness owing by the Borrower or the Shareholder if
the effect of such failure is to accelerate, or to permit the holder of such
indebtedness to accelerate the maturity of such indebtedness; or
(f) The Borrower shall expend the proceeds of the Loan for
any purpose other than the purchase of the Station and working capital and
operating expenses relating to the Station without the prior written consent of
the Lender, which may be withheld in the Lender's sole discretion; or
(g) Either (i) Borrower or the Shareholder shall fail to
pay its debts as they mature in the ordinary course of business; or (ii)
Borrower or the Shareholder shall file a petition commencing a voluntary case
concerning it under any Chapter of Title 11 of the United States Code
entitled "Bankruptcy"; or (iii) Borrower or the Shareholder shall apply for or
consent to the appointment of any receiver, trustee, custodian or similar
officer for it or for all or any substantial part of its property; or (iv) such
receiver, trustee, custodian or similar officer shall be appointed without the
application or consent of the Borrower or the Shareholder and such appointment
shall continue undischarged for a period of thirty (30) days; or (v) an
involuntary case is commenced against the Borrower or the Shareholder under any
Chapter of the aforementioned Title 11 and an order for relief under such Title
11 is entered or the petition commencing the case is controverted but is not
dismissed within thirty (30) days after the commencement of the case; or (vi)
the Borrower or the Shareholder shall institute (by petition, application,
answer, consent or otherwise) any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debt, dissolution, liquidation or
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similar proceeding relating to it under the laws of any jurisdiction; or
(vii) any such proceeding shall be instituted against the Borrower or the
Shareholder and shall remain undismissed for a period of thirty (30) days; or
(viii) the Borrower or the Shareholder shall take any action for the purpose of
effectuating the foregoing; or
(h) Any court, government, or government agency shall
condemn, seize or otherwise appropriate or take custody or control of all or a
substantial portion of the property or assets of the Borrower; or
(i) There shall be a cancellation, denial or revocation of
any material FCC License for the Station, the Borrower shall be finally denied
renewal of any such License, or any such FCC License shall be renewed on terms
that materially adversely affect the economic or commercial value or usefulness
thereof; or
(j) Any money judgment, writ or warrant of attachment, or
similar process involving (i) in any individual case an amount in excess of One
Hundred Thousand Dollars ($100,000.00), or (ii) in the aggregate at any time an
amount in excess of One Hundred Thousand Dollars ($100,000.00), and in either
case not adequately covered by insurance as to which the insurance company has
acknowledged coverage, shall be entered or filed against Borrower or its 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
(k) The Shareholder shall default in the due performance or
observance of any term, covenant or agreement on its part to be performed or
observed pursuant to Article IX hereof or any obligation of the Shareholder
under Article IX hereof shall, for any reason other than the full satisfaction
thereof, not be or shall cease to be in full force and effect or is, or is
declared to be, null and void, or the Shareholder shall, or shall purport to,
terminate, revoke, repudiate, declare voidable or void, deny, disaffirm or
otherwise contest Article IX hereof or any term or provision thereof or any of
its obligations or liabilities under Article IX hereof.
Section 7.2 Effect of Event of Default. Should any Event of Default
occur, the Lender may at its option by written notice to the Borrower declare
the entire unpaid principal amount of the Note, together with all unpaid
interest and all other amounts payable under this Agreement and every other
obligation of the Borrower to the Lender, immediately due and payable, whereupon
the Note and all such obligations shall become and be forthwith due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower, anything contained herein or in the
Note or in such other note or evidence of indebtedness to the contrary
notwithstanding; provided,
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however, that in case of an Event of Default under Section 7.1(g), all
the obligations of the Borrower under this Agreement and the Note shall become
immediately due and payable as of the date of any such Event of Default
regardless of the cause of such Event of Default and without any notice to the
Borrower required from the Lender. The Lender shall have, in addition to all
other rights and remedies allowed by law, the rights and remedies of a secured
party under the Uniform Commercial Code and, without limiting the generality of
the foregoing, the rights and remedies provided for in the Security Agreement,
Pledge Agreements, and any Mortgage or Leasehold Mortgage, which provisions are
hereby incorporated by reference.
ARTICLE VIII. MISCELLANEOUS
Section 8.1 No Waiver; Cumulative Remedies. No failure
or delay on the part of the Lender in exercising any right, power or remedy
hereunder shall operate as a waiver, nor shall any single or partial exercise
of any such right, power or remedy hereunder. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
Section 8.2 Amendments. No amendment, modification,
termination or waiver of any provision of this Agreement, the Note, the
Security Agreement, the Pledge Agreement or any Mortgage or Leasehold Mortgage,
nor consent to any departure by the Borrower therefrom, shall in any event be
effective unless in writing, signed by the Lender and then only in the specific
instance and for the specific purpose for which given. No notice to or demand
on the Borrower in any case shall entitle it to any other or further notice or
demand in similar or other circumstances.
Section 8.3 Conflicts. In the event of any conflict or
inconsistency between any provision of this Agreement and a provision of the
Note, the Security Agreement, the Pledge Agreement or any Mortgage or Leasehold
Mortgage, the provisions of this Agreement shall control.
Section 8.4 Address for Notices. All notices and other
communications under this Agreement shall be in writing and shall be served by
personal service or by mailing a copy thereof by registered or certified mail,
return receipt requested, to the applicable party at the addresses indicated
below:
If to the Borrower: James L. West
The Christian Network, Inc.
14444 66th Street North
Clearwater, Florida 34624
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If to the Lender: Lowell W. Paxson
Paxson Communications of Milwaukee-55, Inc.
601 Clearwater Park Road
West Palm Beach, Florida 33401
or at such other address as may be designated by either party in a written
notice to the other complying as to delivery with the terms of this Section.
All such notices and other communications shall be effective when deposited in
the mails.
Section 8.5 Expenses. The Borrower agrees to pay on
demand all costs and expenses incurred by the Lender directly in the
enforcement of this Agreement, the Note, the Security Agreement, any Mortgage
or Leasehold Mortgage, the Pledge Agreement and other instruments and documents
to be delivered hereunder, including, without limitation, the reasonable fees
and expenses of any attorney to whom the Note is referred for collection
(whether or not litigation is commenced) or for representation out of court, in
trial, on appeal or in proceedings under any bankruptcy or insolvency law or
otherwise. In addition, the Borrower shall pay any and all taxes and fees
payable or determined to be payable in connection with the execution, delivery
or recordation of any instruments and documents to be delivered hereunder. In
addition, Borrower agrees to pay (i) all the actual and reasonable costs and
expenses of Lender in connection with the negotiation, preparation and
execution of this Loan Agreement, the Note, the Security Agreement, the Pledge
Agreement, any Mortgage or Leasehold Mortgage and all other documents and
instruments to be delivered hereunder (collectively, the "Loan Documents") and
all the costs of furnishing all opinions by counsel for Borrower, and of
Borrower's performance of and compliance with all agreements and conditions
contained herein and in the other Loan Documents on its part to be performed or
complied with including, without limitation, confirming compliance with
environmental and insurance requirements; (ii) the reasonable fees, expenses
and disbursements of counsel to Lender (including allocated costs of internal
counsel) in connection with the negotiation, preparation, execution and
administration of the Loan Documents and the Loan and any consents, amendments,
waivers or other modifications hereto or thereto; and (iii) all the actual and
reasonable costs and expenses of creating and perfecting liens in favor of
Lender pursuant to any Loan Document.
Section 8.6 Binding Effect; Assignment. This Agreement
shall become effective when executed and thereafter shall be binding upon and
inure to the benefit of the Borrower, the Lender and their respective
successors and assigns, except that the Borrower shall not have the right to
assign any rights or obligations hereunder without the prior written consent of
the Lender. Lender shall be permitted to assign, without Borrower's consent,
all or any portion of Lender's rights and interests hereunder and under each
other document executed in
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connection with this Loan Agreement (x) to one or more other affiliates
of Lender, and, upon any such assignment, each reference herein or in such other
document to "Lender" shall be deemed to be and include a reference to such other
affiliate and (y) to creditors of Lender or its affiliates as security for
indebtedness of Lender or such affiliates. For purposes of this section, the
term affiliate shall mean, as applied to any entity or individual, any other
entity or individual directly or indirectly controlling, controlled by, or under
common control with, that entity or individual. For purposes of this
definition, "control" (including with correlative meanings, the terms
"controlling", "controlled by" and under "common control with"), as applied to
any entity or individual, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of that
entity or individual, whether through the ownership of voting securities,
partnership interests or otherwise by contract.
Section 8.7 Governing Law. This Agreement, the Note, the
Security Agreement and related documents shall be governed by, and construed in
accordance with, the laws of the State of Florida with the exception of its
conflicts of laws provisions; provided that the effect of any recordation shall
be determined by the State thereof.
Section 8.8 Severability of Provisions. Any provision of
this Agreement, the Note, the Pledge Agreement, the Security Agreement, or any
Mortgage or Leasehold Mortgage that 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 or affecting the validity or enforceability of any provisions in any
other jurisdiction.
Section 8.9 Headings. Article and Section headings in
this Agreement are included for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
Section 8.10 Rights Affected by Extensions. The rights of
the Lender and its assigns shall not be impaired by any indulgence, release,
renewal, extension or modification which the Lender may grant with respect to
the indebtedness or any part thereof, or with respect to the collateral or with
respect to any endorser, guarantor, or surety without notice or consent of the
Borrower or any endorser, guarantee, or surety.
Section 8.11 Survival of Representations and Warranties.
All representations and warranties made in this Agreement and in any documents
or certificates delivered pursuant hereto or thereto shall survive the
execution and delivery of this Agreement and the Note and the making of the
Loan hereunder and continue in full force and effect, as of the respective
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dates as of which they were made, until all of the obligations of the Borrower
to the Lender hereunder have been paid in full.
Section 8.12 FCC Compliance. Notwithstanding anything
herein or in any of the other Loan Documents to the contrary, but without
limiting or waiving the Borrower's obligations hereunder or under any of the
other Loan Documents, the Lender's remedies hereunder and under the other Loan
Documents are subject to compliance with the Communications Act of 1934, as
amended, and all applicable rules, regulations and policies of the FCC, and the
Lender will not take any action pursuant to this Agreement or any of the other
Loan Documents that would constitute or result in any assignment of any FCC
authorization held by the Borrower or any change of control of the Station if
such assignment or change of control would require under then existing law
(including the written rules and regulations promulgated by the FCC), the prior
approval of the FCC, without first obtaining such approval of the FCC. This
Agreement, the other Loan Documents and the transactions contemplated hereby
and thereby do not and will not constitute, create, or have the effect of
constituting or creating, directly or indirectly, actual or practical ownership
of the Borrower by the Lender or control, affirmative or negative, direct or
indirect, of the Borrower by the Lender, over the programming, management or
any other aspect of the operation of the Borrower, which ownership and control
remain exclusively and at all times in the Borrower until such time as the
Lender has complied with such law, rules, regulations and policies.
Section 8.13 Further Assurances. From time to time, the
Borrower shall execute and deliver to the Lender such additional documents as
the Lender may reasonably require to carry out the purposes of this Agreement
or any of the documents entered into in connection herewith, or to preserve and
protect the rights of the Lender hereunder or thereunder.
Section 8.14 Indemnification. The Borrower hereby indemnifies
and holds harmless the Lender and its directors, officers, shareholders,
employees, agents, counsel, subsidiaries and affiliates (the "Indemnified
Persons") from and against any and all losses, liabilities, obligations,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may be imposed on, incurred by, or
asserted against any Indemnified Person in any way relating to or arising out
of this Agreement, the documents entered into in connection herewith, or any of
them or any of the transactions contemplated hereby or thereby; provided,
however, that the Borrower shall not be liable to any Indemnified Person, if
there is a judicial determination that such losses, liabilities, obligations,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the gross negligence or willful misconduct of such
Indemnified Person.
Section 8.15 Waiver. EACH OF LENDER, BORROWER AND SHAREHOLDER
HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHT TO A JURY TRIAL OF ANY
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CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, ANY OF
THE LOAN DOCUMENTS, OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER
OF THIS LOAN TRANSACTION AND THE LENDER/BORROWER RELATIONSHIP THAT IS BEING
ESTABLISHED. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, REPLACEMENTS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT, THE LOAN DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING
TO THE LOAN.
Section 8.16 Maximum Interest. Lender and Borrower intend
that this Agreement and the other Loan Documents conform to all applicable
usury laws. Accordingly, no provisions of the Loan Documents shall require the
payment or permit the collection of interest in excess of the maximum rate
permitted by applicable law ("Maximum Rate"), or obligate Borrower to pay any
taxes, assessments, charges, insurance premiums or other amounts which are held
to constitute interest to the extent that such payments, when added to the
other obligations under the Loan Documents, would be held to constitute
contracting for, or the payment by Borrower of, interest at a rate greater than
the Maximum Rate. Lender and Borrower further agree that:
(a) if any excess of interest in such respect is herein or
in any such other instrument provided for, or shall be adjudicated to be so
provided for herein or in any such instrument, the provisions of this subsection
8.16 shall govern, and neither Borrower nor its successors or assigns shall be
obligated to pay the amount of such interest to the extent it is in excess of
the Maximum Rate;
(b) if at any time the amount of interest under any of the
Loan Documents for a calendar year exceeds the Maximum Rate had the Maximum Rate
at all times been in effect, the interest chargeable under any such Loan
Document shall be limited to the amount of interest that could have been charged
if the Maximum Rate had at all times been in effect, but any subsequent
reductions in the interest due shall not reduce the rate of interest chargeable
under any such Loan Document below the Maximum Rate until the total amount of
interest accrued under any such Loan Document equals the amount of interest that
would have accrued if the interest provided for in any such Loan Document had at
all times been in effect and collectible;
(c) if the maturity of any Loan Document is accelerated for
any reason, or in the event of any prepayment by Borrower, or in any other
event, earned interest may never include more than the Maximum Rate, computed
from the date of disbursement of the funds evidenced by such Loan Document until
payment, and any interest otherwise payable
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under such Loan Document that is in excess of the Maximum Rate shall be
canceled automatically as of such acceleration or such other event and (if
theretofore paid) shall be credited against principal;
(d) if it should be held that any interest payable or
chargeable under any Loan Document is in excess of the Maximum Rate, the
interest payable or chargeable under such Loan Document shall be reduced to the
maximum amount permitted by applicable federal or state law, whichever shall
permit the higher lawful interest, as construed by courts having jurisdiction
thereof; and
(e) the spreading, prorating and amortizing of interest
over the term of the Loan Documents shall be allowed to the fullest extent
permitted by applicable law.
ARTICLE IX. GUARANTY
Section 9.1 Guaranty. In consideration for Lender's execution and
delivery of this Loan Agreement and Lender's agreement to make the Loan,
Shareholder agrees as follows:
(a) Shareholder hereby guarantees the full, complete and
timely payment and performance by Borrower of each and every obligation of
Borrower under this Loan Agreement, the Note, the Security Agreement, each
Mortgage and Leasehold Mortgage executed and delivered pursuant to this Loan
Agreement and each other agreement or instrument executed and delivered by
Borrower in connection with this Loan Agreement (individually, a "Borrower Loan
Document" and collectively, the "Borrower Loan Documents"). If any default shall
be made by Borrower in the payment or performance of any of such obligations,
then Shareholder will itself pay or perform or cause to be paid or performed
such obligation upon receipt of notice from Lender specifying in summary form
the default. Lender may proceed to enforce its rights against Shareholder from
time to time prior to, contemporaneously with, or after any enforcement against
Borrower, or without any enforcement against Borrower. The obligations of
Shareholder under this Guaranty shall be absolute and unconditional and shall
remain in full force and effect without regard to and shall not be released,
discharged, or in any way affected by (and Shareholder expressly waives any
and all defenses arising out of, or based on): (i) any amendment or
modification of or supplement to any Borrower Loan Document; (ii) any exercise
or non-exercise of, or delay in exercising any, right, remedy, power, or
privilege under or in respect of any Borrower Loan Document; (iii) any
bankruptcy, insolvency, arrangement, composition, assignment for the benefit of
creditors, or similar proceeding commenced by or against Borrower or
Shareholder; (iv) the dissolution (voluntarily or involuntarily) of Lender; (v)
the genuineness, validity, or enforceability of any Borrower Loan Document; or
(vi) any other circumstance which might otherwise constitute a legal or
equitable discharge of a guarantor
- 23 -
or surety. If payment of any sum by Borrower pursuant to any Borrower
Loan Document is recovered as a preference or fraudulent transfer under any
applicable bankruptcy or insolvency law, the liability of Shareholder under such
Borrower Loan Document shall continue and remain in full force and effect
notwithstanding such recovery.
(b) Shareholder waives presentment, protest, demand, or
action or delinquency in respect of any of the obligations of Borrower under the
Borrower Loan Documents. Shareholder waives all set-offs and counterclaims and
all notices of nonperformance, notices of protest, notices of dishonor, and
notices of acceptance of this guaranty.
(c) This guaranty shall be deemed a continuing guaranty,
and the above consents and waivers of Shareholder shall remain in full force and
effect until the satisfaction in full of all obligations of Borrower under the
Borrower Loan Documents.
(d) Shareholder agrees that any and all claims in its favor
against Borrower, any endorser or any other guarantor of all or any part of the
obligations of Borrower under the Borrower Loan Documents, or against any of
their respective properties, arising by reason of any payment by Shareholder to
Lender pursuant to the provisions hereof or otherwise, shall be subordinate and
subject in right of payment to the prior payment, in full in cash, of all
obligations of Borrower under the Borrower Loan Documents. Shareholder agrees
that any right of subrogation arising as a result of its performance hereunder
shall not exist unless and until all obligations of the Borrower under the
Borrower Loan Documents are paid in full in cash.
Section 9.2 Representations and Warranties. Shareholder
hereby represents and warrants to Lender as follows:
(a) This Loan Agreement has been duly and validly executed
and delivered by Shareholder and constitutes its legal, valid, and
binding agreement with respect to the provisions contained in Article IX,
enforceable in accordance with its terms, except as the enforceability of this
Loan Agreement may be affected by bankruptcy, insolvency, or similar laws
affecting creditors' rights generally, and by judicial discretion in the
enforcement of equitable remedies.
(b) The execution, delivery, and performance by Shareholder
of this Loan Agreement: (i) do not require the consent of any third party; (ii)
will not conflict with any provision of the Articles of Incorporation or Bylaws
of Shareholder; (iii) will not conflict with, result in a breach of, or
constitute a default under, any law, judgment, order, ordinance, injunction,
decree, rule, regulation, or ruling of any court or governmental
- 24 -
instrumentality; and (iv) will not conflict with, constitute grounds for
termination of, result in a breach of, constitute a default under, or accelerate
or permit the acceleration of any performance required by the terms of, any
agreement, instrument, license, or permit to which Shareholder is a party or by
which Shareholder may be bound.
Section 9.3 Limited Recourse. Notwithstanding anything
to the contrary contained in this Article IX, in any action or proceeding
commenced with reference to any Loan Document, no judgment obtained against
Shareholder shall be enforced against any of its separate assets, other than
Shareholder's interest in all of the issued and outstanding capital stock of
Borrower (whether outstanding on the date hereof or hereafter), and
Shareholder's liability under any Loan Document shall be limited to such
interest. In any legal action or suit in equity which the Lender may undertake
against Shareholder to enforce its rights and remedies under any Loan Document,
any judgment obtained by Lender may be satisfied by recourse only to
Shareholder's interest in all of the issued and outstanding capital stock of
Borrower (whether outstanding on the date hereof or hereafter) and not by
recourse to any other assets of Shareholder.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective duly authorized officers, as of
the date first above written.
PAXSON COMMUNICATIONS OF
MILWAUKEE-55, INC.
By: /s/ William L. Watson
--------------------------------------
William L. Watson
Secretary
CHANNEL 55 OF MILWAUKEE, INC.
By: /s/ James L. West
--------------------------------------
James L. West
Chairman
THE CHRISTIAN NETWORK, INC. HEREBY
JOINS IN THE EXECUTION OF THE FOREGOING
AGREEMENT TO AGREE TO THE PROVISIONS OF
SECTION 8.15 AND ARTICLE X ONLY, AS OF
THE DATE FIRST ABOVE WRITTEN.
THE CHRISTIAN NETWORK, INC.
By: /s/ James L. West
--------------------------------------
James L. West
Chairman
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-Q’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 8/13/96 |
| | 7/9/96 | | 1 | | 5 |
| For Period End: | | 6/30/96 |
| | 3/31/95 | | 8 | | | | | 10-Q |
| List all Filings |
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