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EXHIBIT 10.3
RESTATED AND AMENDED CONTRIBUTION AGREEMENT
This Restated and Amended Contribution Agreement ("Agreement") dated as of
June 29, 2001 by and among ACME Television, LLC, a Delaware limited liability
company ("ACME"), and ACME Communications, Inc., a Delaware corporation (the
"Company").
RECITALS
A. The Company indirectly owns 100% of the membership interests of ACME.
B. ACME, certain "Lenders" named therein and Canadian Imperial Bank of
Commerce, as agent for the Lenders (the "Agent") are parties to a First Amended
and Restated Credit Agreement dated as of December 2, 1997, as amended through
the date hereof (as so amended and as hereinafter amended, restated,
supplemented or otherwise modified from time to time, the "Credit Agreement").
C. The Company and ACME are parties to a Contribution Agreement dated as of
December 29, 2000 (the Original Agreement").
D. ACME, the Lenders, the Agent and Bankers Trust Company, as syndication
agent for the Lenders have entered into a Ninth Amendment to Credit Agreement
dated the date hereof (the "Ninth Amendment") amending certain terms and
conditions of the Credit Agreement. B. It is a condition precedent to the Ninth
Amendment that the Company and ACME enter into this Agreement to restate and
amend the Original Agreement to make certain corresponding revisions required
under the Ninth Amendment.
E. Capitalized terms not defined herein shall have the meanings given to
such terms in the Credit Agreement.
NOW THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt of which is hereby acknowledged, the Company
and ACME hereby agree as follows:
AGREEMENT
SECTION 1. COMMITMENTS; PARENT RESERVE.
(a) The Company hereby agrees to maintain, solely for ACME's benefit, cash
or cash equivalents for equity contributions to ACME in an aggregate amount
equal to the greater of (i) $13,000,000 or (ii) the aggregate amount of the
Company's cash on hand and cash equivalents as of the date hereof, to the extent
the same exceeds $7,500,000, which amount shall be permanently reduced by (x)
any voluntary cash equity contributions made by the Company to ACME after the
date hereof and (y) up to $2,500,000 in the aggregate, but only (dollar for
dollar) to the extent that ACME obtains commitments for New Lease Financing,
provided that such financing is funded before January 1, 2002. As used herein,
the term "New Lease Financing" means additional lease or vendor financing
commitments to finance Adjusted Capital Expenditures (as permitted under
SECTIONS 7.01(G) and 7.02(G) of the Credit Agreement and excluding ACME's
existing lease facility provided by Union Bank of California) The cash and cash
equivalents required to be maintained by the Company for ACME's benefit as
provided herein, after giving effect to the reductions described above, are
referred to as the "Parent Reserve").
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(b) To the extent that ACME fails to obtain New Lease Financing as
scheduled in the Table below for any fiscal period, ACME may call against the
Parent Reserve, within ten (10) days after the end of such fiscal period, to
finance the shortfall, and the Company shall make payment to ACME from the
Parent Reserve within thirty (30) days after the end of such fiscal period.
FISCAL PERIOD PROJECTED NEW LEASE FINANCING
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July 1 through $2,400,000
December 2001
January 1 through None projected
March 31, 2002
April 1 through June 30, 2002 $6,000,000
July 1 through $2,500,000
September 30, 2002
(c) If ACME calls against the Parent Reserve upon the occurrence and during
the existence of any Event of Default under the Credit Agreement, as provided
thereunder, the Company will immediately contribute the full amount of the
Parent Reserve to ACME.
(d) Upon receipt of any equity contribution pursuant to subsection (a) or
(b) above, the Company's capital account shall be adjusted to reflect the amount
of the equity contribution.
SECTION 2. NO SET OFF.
The obligations of the Company under Section 1 shall be absolute and
unconditional under any and all circumstances, including without limitation, the
existence of any default or Event of Default by ACME in the performance or
observance of any of the agreements or covenants in the Credit Agreement, the
existence of any indebtedness owing by ACME or any if its Subsidiaries to the
Company or any set-off, counterclaim, abatement, recoupment, defense or other
right or claim which the Company may have against ACME, any of its Affiliates or
any other Person, including the Agent and any of the Lenders, the dissolution,
bankruptcy, insolvency or reorganization of the Company, ACME, any of their
respective Affiliates or any other Person or the pendency against the Company,
ACME, any of their respective Affiliates or any other Person of any case, suit
or proceeding under any bankruptcy or insolvency law or any other law providing
for the relief of debtors or any other circumstances whatsoever which might
otherwise constitute an excuse for non-performance of the obligations of the
Company under Section 1, whether similar or dissimilar to any of the
circumstances specified herein.
SECTION 3. BENEFICIARY.
The parties hereto hereby acknowledge that this Agreement has been made for
the benefit of the Agent and the Required Lenders, as well as ACME. As third
party beneficiaries hereunder, the Agent and the Required Lenders shall have the
same rights, powers, privileges, interests and remedies as ACME, including the
right and power to require the Company to make equity contributions from the
Parent Reserve under Section 1(a), whether arising under this
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Agreement or by statute or in law or in equity or otherwise, resulting from any
failure by the Company to perform its obligations under Section 1(a), together
with full power and authority in the names of the Agent or the Required Lenders
to enforce the Company's obligations under Section 1(a) directly.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY.
(a) Membership Interest Ownership. The Company indirectly owns all of the
membership interests of ACME through its wholly-owned subsidiary, ACME
Intermediate Holdings, LLC.
(b) Corporate Existence. The Company (i) is a corporation duly organized
and validly existing under the laws of the jurisdiction of its incorporation;
(ii) has all requisite corporate power and has all material governmental
licenses, authorizations, consents and approvals necessary to carry on its
business as now being conducted except where the failure to have such
governmental licenses, authorizations, consents and approvals would not have a
material adverse effect on the Company's business or operations; and (iii) is
qualified to do business in all jurisdictions in which the nature of its
business makes such qualification necessary and where the failure to so qualify
would have a material adverse effect on the Company's business or operations.
(c) Corporate Action. The Company has all necessary corporate power and
authority to execute, deliver and perform its obligations under this Agreement;
the execution, delivery and performance by the Company of this Agreement has
been duly authorized by all necessary corporate action on its part; and this
Agreement has been duly and validly executed and delivered by the Company and
constitutes its legal, valid and binding obligation, enforceable in accordance
with its terms, except (i) as may be limited by bankruptcy, insolvency,
moratorium or other similar laws affecting the enforcement of creditors' rights
in general, and (ii) enforceability thereof may be subject to general principles
of equity regardless of whether such enforceability is considered in a
proceeding at law or in equity.
(d) Maintenance of Corporate Existence. The Company agrees that, so long as
this Agreement is in effect, it shall (i) preserve and maintain its corporate
existence; and (ii) comply with the requirements of all applicable laws, rules,
regulations and orders of governmental or regulatory authorities if failure to
comply with such requirements would materially and adversely affect the ability
of the Company to perform its obligations under this Agreement.
SECTION 5. MISCELLANEOUS.
(a) Binding Effect; Assignment. This Agreement shall become effective when
it shall have been executed by the Company and ACME and thereafter shall be
binding upon and inure to the benefit of the Company and ACME and their
respective successors and assigns, except that none of the interests, rights or
obligations of the Company hereunder shall be transferable (whether by operation
of law or otherwise), without the prior written consent of the Agent.
(b) Termination of Agreement. This Agreement and all obligations of the
parties hereunder shall not terminate until the earlier of full investment of
the Parent Reserve or the payment in full of the Obligations or the termination
of the Commitments.
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(c) Governing Law; Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of the State of Delaware
(excluding the laws applicable to conflicts or choice of law).
(d) Notices. All notices required or permitted to be given to or made upon
any party to this Agreement shall be made in writing and shall be personally
delivered or sent by registered or certified mail (postage prepaid, return
receipt requested) or by facsimile transmission with confirmation by overnight
courier and shall be deemed to have been duly given or made when received by the
intended recipient in accordance with the provisions of this Section 5(c).
Unless otherwise specified in a notice given or made in accordance with this
provisions of this Section 5(c), notices shall be given to the respective
parties at their respective addresses indicated below.
To the Company: ACME Communications, Inc.
Xxxxx 000
0000 X. Xxxxxx Xxxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000
To ACME: ACME Television, LLC
Xxxxx 000
0000 X. Xxxxxx Xxxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000
In each case notice copy to:
Canadian Imperial Bank of Commerce, as Agent
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxx
In the event of any strike or occurrence of another similar event which
interrupts mail service, notices may be served personally upon an individual,
partner or an officer or director of a corporation which is or is part of the
party being served.
(e) Headings. Headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.
(f) Survival of Agreements. All covenants, agreements, representations and
warranties in this Agreement or in any certificate, instrument, document or
other writing delivered pursuant hereto shall survive the execution and delivery
of this Agreement, and, except as otherwise provided herein, all such covenants
and agreements shall continue in full force and effect.
(g) Entire Agreement. This Agreement contains the full, final and exclusive
statement of the agreement among the Company and ACME relating to the
transactions contemplated hereby. Except as set forth in this Agreement, the
parties acknowledge and agree that the Company is not a guarantor of and shall
have no other obligations or liabilities under the Credit Agreement.
(h) Counterparts. This Agreement may be executed in two or more
counterparts, which when so executed and delivered shall constitute one and the
same instrument.
* THE NEXT PAGE IS THE SIGNATURE PAGE. *
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
ACME COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Executive Vice President
and Chief Financial Officer
ACME TELEVISION, LLC
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Executive Vice President
and Chief Financial Officer
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