Overhead Contribution. AC agrees to provide to RKO the following amounts as contribution towards overhead: (a) $125,000 payable upon the signature hereof ("1st Overhead Payment"); and (b), subject to subsection C. below, $250,000 payable on the date that is thirty (30) days after the date of the payment in (a) ("2nd Overhead Payment"). The following shall be applicable to each of the 1st and 2nd Overhead Payment: A. Each of the 1st and 2nd Overhead Payments shall be deemed loans to RKO carrying an interest rate equal to the then applicable prime rate of Bank of America and such amount shall be deemed to be a 12-month loan to RKO unless otherwise repaid or credited as provided in subparagraphs 10.D and E below. B. The 1st Overhead Payment shall be mandatory and RKO's obligations under this Agreement, shall in all cases be conditioned upon RKO's timely receipt of such payment. C. The 2nd Overhead Payment shall be made at AC's sole discretion, provided that: (i) AC agrees to provide RKO with at least seven (7) business days notice of its intent to make such overhead payment; and (ii) upon RKO's timely receipt of such payment, AC shall thereafter for the next thirty (30) day period ("Lockup Period") be provided with the exclusive right to close its deal pursuant to the terms hereof, RKO agreeing that upon receipt of the 2nd Overhead Payment RKO will refrain from discussing m y sale or refinancing of RKO for a period equal to the Lockup Period. In the event that the Closing has not occurred as of the expiration of the Lockup Period, and AC wishes to extend the Lockup Period for another thirty (30) day period ("Extended Lockup Period"), then it may do so (but only once) by notifying RKO of its intention to do the same and delivering to RKO on no less than seven (7) business days notice of its intent to make such payment and thereafter making a payment equal to the amount of the 2nd Overhead Payment (the "Extension Payment") no later than the date that is thirty (30) days after the due date of the 2nd overhead payment. For avoidance of doubt it is agreed by the parties that failure of AC to make the 2 d Overhead Payment shall terminate this Agreement, except with respect to the obligations of RKO under subsection 10.A above. D. At the Closing, the loans representing each of the 1st and 2nd Overhead Payments (and the Extension Payment, if applicable) shall be cancelled and applied towards the purchase price of RKO to reduce the amount actually paid at Closing to the members. E. The following shall apply in the event that the Closing does not occur: (i) if the Closing has not occurred prior to the commencement of the Lockup Period, but AC had satisfied all condition 3 precedent and was ready, willing and able to Close the transaction prior to the start of the Lockup Period, and the Closing did not take place through no fault of AC, then AC shall be entitled to receive as a "break-up fee" an amount equal to 150% of the 1st Overhead Payment actually paid by AC to RKO; (ii) if the Closing has not occurred during, or prior to the expiration of, the Lockup Period, but AC had satisfied all conditions precedent and was ready, willing and able to Close the transaction during, but prior to the expiration of the Lockup Period, and the Closing did not take place through no fault of AC, then AC shall be entitled to receive as a "break-up fee" an amount equal to the 1st and 2nd Overhead Payment actually paid by AC to RKO plus an additional amount equal to $250,000, provided, however, that RKO shall be excused from its obligation to Close only if (A) an action or proceeding has been initiated, including without limitation a governmental action, against RKO or any of its officers, directors, members, employees or affiliates; or (B) any other condition to RKO's obligation to close, as set forth herein or in the long-form merger agreement described in Section 6.1 above, has not been satisfied: (iii) if the Closing has not occurred during, or prior to the expiration of, the Extended Lockup Period, if applicable, but AC had satisfied all conditions precedent and was ready, willing and able to Close the transaction during, but prior to the expiration of the Extended Lock-up Period, and the Closing did not take place through no fault of AC, then AC shall be entitled to receive as a "break-up fee" an amount equal to the 1st and 2nd Overhead Payments, plus the payment made during the Extended Lock-up Period, plus an additional amount equal to $375,000, provided however, that that RKO shall be excused from its obligation to Close as provided in subsection (ii)(A) and (B) above; and (iv) the break-up fee shall be due and payable immediately upon notification to AC by RKO of RKO's unwillingness to Close the transaction; and subject to the conditions provided in each of subparagraphs E(ii) and (iii), and payment of the break-up fee, neither RKO, the Sellers, nor any of their affiliates shall have any further liability or obligation whatsoever to AC or any of its stockholders, directors, officers or affiliates.
Appears in 1 contract
Overhead Contribution. AC agrees to provide to RKO the following amounts as contribution towards overheadover head: (a) $125,000 payable upon the signature hereof no later than May 31, 2003 ("1st Overhead Payment") (the receipt of which is hereby acknowledged); and (b), subject to subsection C. below, $250,000 payable on the date that is thirty (30) days after the date of the payment in (a) June 16, 2003 ("2nd Overhead Payment"). The following shall be applicable to each of the 1st and 2nd Overhead Payment:
A. Each of the 1st and 2nd Overhead Payments shall be deemed loans to RKO carrying an interest rate equal to the then applicable prime rate of Bank of America and such amount shall be deemed to be a 12-month loan to RKO unless otherwise repaid or credited as provided in subparagraphs 10.D and E below.
B. The 1st Overhead Payment shall be mandatory 2. Paragraph 10,C is hereby delted in its entirety and RKO's obligations under this Agreement, shall in all cases be conditioned upon RKO's timely receipt of such payment.replaced with the following:
C. The 2nd Overhead Payment shall be made at AC's sole discretion, provided provide that: (iI) AC agrees to provide RKO with at least seven (7) business days notice of its intent to make such overhead paymentpayment (the receipt of such notice which is hereby acknowledged); and (iiII) upon RKO's timely receipt of such payment, AC shall thereafter for the next thirty twenty-three (3023) day period ("Lockup Period") be provided with the exclusive right to close its deal pursuant to the terms hereof, RKO agreeing that upon receipt of the 2nd Overhead Payment RKO will refrain from discussing m y discussin any sale or refinancing of RKO for a period equal to the Lockup Period. In the event that the Closing has not occurred as of the expiration of the Lockup Period, and AC wishes to extend the Lockup Period for another an additional thirty (30) day period ("Extended Lockup Period"), then it may do so (but only once) by notifying RKO of its intention to do the same and delivering to RKO on no less than seven (7) business days notice of its intent to make such payment and thereafter making a payment equal to the amount of the 2nd Overhead Payment (the "Extension Payment") no later than the date that is thirty end of business (305:00pm PDT) days after the due date of the 2nd overhead paymentAugust 8, 2003. For avoidance of doubt it is agreed by the parties that failure of AC to make the 2 d 2nd Overhead Payment shall terminate this Agreement, except with respect to the obligations of RKO under subsection 10.A above.. Mr. ▇▇▇ ▇▇▇▇▇▇▇ Ms. ▇▇▇▇ ▇▇▇▇▇▇▇ June 6, 2003
D. At 3. This amendment is being made only as to the Closingmatters specified in sections 1 and 2 hereof. In all other respect, the loans representing each of the 1st LOI shall continue in full force and 2nd Overhead Payments (and the Extension Payment, if applicable) shall be cancelled and applied towards the purchase price of RKO to reduce the amount actually paid at Closing to the members.
E. The following shall apply effect in the event that the Closing does not occur:
(i) if the Closing has not occurred prior to the commencement of the Lockup Period, but AC had satisfied all condition 3 precedent and was ready, willing and able to Close the transaction prior to the start of the Lockup Periodaccordance with its terms, and the Closing did not take place through no fault of AC, then AC shall be entitled to receive as a "break-up fee" an amount equal to 150% of the 1st Overhead Payment actually paid by AC to RKO;
(ii) if the Closing has not occurred during, or prior to the expiration of, the Lockup Period, but AC had satisfied all conditions precedent parties hereby reaffirm and was ready, willing and able to Close the transaction during, but prior to the expiration of the Lockup Period, and the Closing did not take place through no fault of AC, then AC shall be entitled to receive as a "break-up fee" an amount equal to the 1st and 2nd Overhead Payment actually paid by AC to RKO plus an additional amount equal to $250,000, provided, however, that RKO shall be excused from its obligation to Close only if (A) an action or proceeding has been initiated, including without limitation a governmental action, against RKO or any of its officers, directors, members, employees or affiliates; or (B) any other condition to RKO's obligation to close, ratify their agreement as set forth herein or in the long-form merger agreement described in Section 6.1 above, has not been satisfied:
(iii) if the Closing has not occurred during, or prior LOI. Any future reference to the expiration of, LOI shall mean the Extended Lockup Period, if applicable, but AC had satisfied all conditions precedent and was ready, willing and able to Close the transaction during, but prior to the expiration of the Extended Lock-up Period, and the Closing did not take place through no fault of AC, then AC shall be entitled to receive LOI as a "break-up fee" an amount equal to the 1st and 2nd Overhead Payments, plus the payment made during the Extended Lock-up Period, plus an additional amount equal to $375,000, provided however, that that RKO shall be excused from its obligation to Close as provided in subsection (ii)(A) and (B) above; and
(iv) the break-up fee shall be due and payable immediately upon notification to AC amended by RKO of RKO's unwillingness to Close the transaction; and subject to the conditions provided in each of subparagraphs E(ii) and (iii), and payment of the break-up fee, neither RKO, the Sellers, nor any of their affiliates shall have any further liability or obligation whatsoever to AC or any of its stockholders, directors, officers or affiliatesthis amendment letter.
Appears in 1 contract