SECOND RESTATED AND AMENDED CONTRIBUTION AGREEMENT
This Second Restated and Amended Contribution Agreement ("Agreement")
dated as of September 28, 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") and as Restated and Amended as
of June 29, 2001.
D. ACME, the Lenders, the Agent and Bankers Trust Company, as
syndication agent for the Lenders have entered into a Tenth Amendment to Credit
Agreement dated the date hereof (the "Tenth Amendment") amending certain terms
and conditions of the Credit Agreement.
E. It is a condition precedent to the Tenth 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 Tenth Amendment.
F. 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
(the "Base 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 $7,000,000, which Base 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").
(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
------------- -----------------------------
July 1 through $2,400,000
December 2001
January 1 through None projected
March 31, 2002
April 1 through $6,000,000
June 30, 2002
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,
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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 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.
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(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.
(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
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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.
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
----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Executive Vice President and CFO
ACME TELEVISION, LLC
By: /s/ Xxxxxx X. Xxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Executive Vice President and CFO
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