GUARANTY AND LEASE COMPENSATION AGREEMENT
THIS GUARANTY AND LEASE COMPENSATION AGREEMENT (this "Agreement") is made
this 20th day of December, 1999, and is intended to be effective as of September
16, 1999, by and between Acrodyne Communications, Inc. ("Acrodyne"), a Delaware
corporation and Xxxxxxxx Broadcast Group, Inc. ("Xxxxxxxx"), a Maryland
corporation. Witnesseth:
Recitals
On September 19, 1999, Acrodyne entered into a Two Million Five Hundred
Thousand Dollars and No Cents ($2,500,000.00) line of credit (the "Line of
Credit") with PNC Bank, National Association (the "Bank"). The Bank required as
a condition of making the loan that Xxxxxxxx unconditionally and irrevocably
guarantee all of Acrodyne's obligations with respect to the Line of Credit.
Xxxxxxxx entered into a Limited Guaranty and Suretyship Agreement (the "Loan
Guaranty") dated September 19, 1999, the beneficiary of which is the Bank.
At Acrodyne's request, Xxxxxxxx intends to enter into a lease (the "Lease")
with PBP,L.P. (the "Lessor") for the benefit of Acrodyne certain real property
located on Hollow Road, Upper Providence Township, Xxxxxxxxxx County,
Pennsylvania and 44,000 square feet, plus or minus, of the building thereon, for
the purpose of establishing Acrodyne's new manufacturing facility. Upon
execution of the Lease, Acrodyne has agreed to sublease the premises from
Xxxxxxxx.
Acrodyne, by letters dated September 16th and 17th to Xxxxxxxx, has agreed
to compensate Xxxxxxxx for the Loan Guaranty and Lease as set forth herein.
NOW, THEREFORE, Acrodyne and Xxxxxxxx intending to be legally bound agree
as follows:
1 - Loan Guaranty Compensation; Initial and Subsequent. Acrodyne agrees to
compensate Xxxxxxxx for the Loan Guaranty as follows:
a) On September 16, 1999 Seventy Five Thousand Three Hundred (75,300)
shares of Acrodyne common voting stock traded on the NASDAQ National Market
System ("NASDAQ"), based upon the closing price as quoted on NASDAQ on September
16, 1999.
b) On October 1, 2000 and on each and every October 1st thereafter
until such time as the Bank no longer requires the Loan Guaranty, Acrodyne shall
pay Xxxxxxxx an amount equal to the average of the Line of Credit outstanding
balances as of the last day of each of the preceding twelve (12) months (not to
be less than One Million Seven Hundred Thousand Dollars and No Cents
($1,700,000.00)) multiplied by twelve and
one-half percent (12.5%). Said amount shall be payable in the form of Acrodyne
common voting stock and calculated by dividing said amount by the average of the
closing price of Acrodyne common voting stock for the last four (4) Business
Days in each September and the first (lst) Business Day in each October. For the
purposes of this Agreement "Business Day" shall mean any day in which NASDAQ is
opened.
2. Loan Compensation. So long as the Landlord requires Xxxxxxxx to be a
lessee, obligor, maker, endorser, surety, guarantor or otherwise obligated on
the Lease, Acrodyne agrees to compensate Xxxxxxxx as follows:
a) On the lease execution date Thirty Six Thousand Seven Hundred
(36,700) shares of Acrodyne common voting stock.
b) On each Lease anniversary date, Seventy Thousand Dollars and No
Cents ($70,000.00) payable in the form of Acrodyne common voting stock based
upon the per share value of Acrodyne common voting stock calculated as the
average closing price for Acrodyne common voting stock for the five (5) Business
Days preceding the Lease Anniversary date.
3. Delivery of Shares: All shares of Acrodyne common voting stock required
to be paid to Xxxxxxxx pursuant to Sections 1 and 2 above shall be delivered to
Xxxxxxxx via Federal Express for next-day delivery at 00000 Xxxxxx Xxx Xxxx,
Xxxxxxxxxxxx, Xxxxxxxx 00000 or such other address as Xxxxxxxx may from time to
time request to the attention of Xxxxx X. Xxx, Executive Vice President.
4. No Violation or Breach. Each party, represents and warrants to the other
party that the performance of this Agreement does not violate any federal,
state, or local law, statute, ordinance, or regulation regarding controlled
substances, or otherwise, or any agreement, court or administrative order or
ruling by which such party may be bound.
5. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties and their legal representatives, successors, and assigns.
6. Authority. The parties represent that they have full authority to bind
their respective corporations by this Agreement, and that all appropriate and
necessary corporate action has been taken in order to authorize the transaction
contemplated thereby. Both parties are corporations in good standing under the
laws of their State of incorporation.
7. Heading. Headings in this Agreement are for convenience only and shall
not be used to interpret or construe its provisions.
8. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Maryland.
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9. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument,
10. Time of Essence. Time is of the essence of this Agreement.
11. Entire Agreement; Modification. This Agreement supersedes all prior
agreements and constitutes the entire agreement between the parties with respect
to the subject matter hereof. It may be changed only by a written agreement,
signed by the party against whom enforcement of any waiver, change,
modification, or discharge is sought.
12. Notices. All notices hereunder shall be in writing and delivered
personally or mailed by certified mail, postage prepaid, addressed to the
parties as set forth below:
If to Acrodyne: Acrodyne Communications, Inc.
000 Xxxxxxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxxx, C.F.O.
With a copy to: Xxxxxx X. Xxxxxx, Esquire
Xxxxxx & Xxxxxxxx, P.A.
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000-0000
If to Xxxxxxxx: Xxxxxxxx Broadcast Group, Inc.
00000 Xxxxxx Xxx Xxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxx X. Xxx, Executive Vice President
With a copy to: Xxxxxx X. Xxxxxx, Esquire
Xxxxxx & Xxxxxxxx, P.A.
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, XX 00000-0000
IN WITNESS WHEREOF, this Agreement is executed under seal by Acrodyne and
Xxxxxxxx as of the date and year first above written.
WITNESS/ATTEST: Acrodyne Communications, Inc.
/s/ Xxxxxx X. Xxxxxxxxx By:/s/ A. Xxxxxx Xxxxxxx (SEAL)
Name: A. Xxxxxx Xxxxxxx
Title: President
(SIGNATURES CONTINUED ON NEXT PAGE)
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WITNESS/ATTEST Xxxxxxxx Broadcast Group, Inc.
/s/ Xxxxxx X. Xxxxxx By:___________________________(SEAL)
Name: Xxxxx X. Xxx
Title: Executive Vice President
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