HomeMy WebLinkAboutR-87-1105J-87-1055
12/10/87 =
RESOLUTION NO. 9 7-11.05
A RESOLUTION APPROVING THE REVOLVING CREDIT
LOAN AGREEMENT BETWEEN MIAMI TELE-
COMMUNICATIONS, INC. AND PROVIDENT NATIONAL
BANK, IN SUBSTANTIALLY THE FORM ATTACHED, FOR
THE PURPOSES OF EXPANDING AND UPGRADING CABLE
TELEVISION FACILITIES TO BETTER SERVE THE —_
CITIZENS OF THE CITY OF MIAMI.
WHEREAS, Miami Tele-Communications, Inc. ("TCI") is the
City's cable licensee pursuant to Cable Television License
Ordinance No. 9332 ("Ordinance No. 9332") as amended; and
WHEREAS, TCI wishes to enter into a Revolving Credit Loan
Agreement for the purposes of expanding and upgrading cable
television facilities to better serve the citizens of the City of
Miami; and
WHEREAS, Section 1610 of Ordinance No. 9332 requires City
Commission approval of said Revolving Credit Loan Agreement;
NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY
OF MIAMI, FLORIDA:
Section 1. The Revolving Credit Loan Agreement between
Miami Tele-Communications, Inc. and Provident National Bank is
hereby approved, in substantially the attached form, for the
purposes of expanding and upgrading cable television facilities
to better serve the citizens of the City of Miami.
Section 2. This Resolution shall become effective
immediately upon adoption.
PASSED AND ADOPTED this 1Qth day o r 1987.
AT S XAVIER 71. SUAREZ, MAYOR
M#fY HIRAI
CITY CLERK
PREPARED AND APPROVED BY: APPROVED AS TO FORM AND
CORRECTNESS:
*L
.UN JONES, TIT UCIA A. DOUGHERTY
DEP CITY ATTORNE ITY ATTORNEY
AQJ/bss/M587
CITY COMMISSION.
MEETING OF
DEC 10 1981
RESOLUTION No.87-1105
r
CABLE COMMUNICATIONS
1987110V 16 PR 7; 01
4 AGREEMENT
LIONS, INC.
,kL BANK
Darted as of October 31. 1987
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INDEX
Section 1 The Loan
1.1 The Revolving Credit Loans
1.2 interest
1.3 Payments and Voluntary Prepayments
1.4 Reduction of Commitment
1.5 Commitment Fee
1.6 Facility Fee
1.7 Payments and Computations
Section 2 Borrower's Representations and -Warranties
2.1 Corporate Existence
2.2 Authority and Binding Effect
2.3 Approvals
2.4 Recording and Enforceability
2.5 Absence of Judgments, Orders and
Litigation
2.6 Taxes
2.7 Franchises, Licenses and Permits
2.8 Utility Agreements
2.9 Other Agreements
2.10 Condition of System
2.11 Franchise and Utility Fees
2.12 Certificates, Licenses, Etc.
2.13 Copyright Laws
2.14 Guaranteed Obligations
2.15 Employment and Management Agreement►
2.16 Trademarks, Patents, Licenses
2.17 No Burdensome Agreements
2.18 Material Agreements
2.19 No Notices of Violations
2.20 Title to Property
2.21 No Misrepresentations or Material
Nondisclosures
2.22 No Other Indebtedness
2.23 Regulations U and X
2.24 ERISA
2.25 No Event of Default
2.26 Financial information
Section 3 Conditions of Lending
3.1 The Initial Loan
3.2 Subsequent Loans
Page
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Section 4 Borrower's Affirmative Covenants
4.1 Furnishing Financial Statements
4.2 Furnish -Additional Financial Information
4.3 Licenses and Permits
4.4 Maintenance of Properties
4.5 Books and Records
4.6 Taxes
4.7 Existence and Rights; Compliance with Laws
4.8 Performance and Compliance with
Material Agreements
4.9 Insurance
4.10 Inspection '
4.11 Leases and Mortgages
4.12 Pay Indebtedness and Perform Otter
Covenants
4.13 Litigation
4.14 Notice of Defaults
4.15 Change of Business Location
4.16- Bank's Expenses
4.17 ERISA
Section 5 Borrower's Negative Covenants
5.1 Dissolution and Merger
5.2 Other Borrowings and Liens
5.3 Guaranties
5.4 Loans and Investments
5.5 Dividends.
5.6 Disposal of Assets
5.7 Discontinuance or Change of Business
5.8 Leases and Leasebacks
5.9 Management Fees
5.10 Stock Issuance
5.11 Control
5.12 Use of Proceeds
5.13 No Misrepresentations or Material
Nondisclosure
Section 6 Defaults and Remedies
6.1 Events of Default
6.2 Remedies
6.3 Remedies Cumulative
6.4 Expenses of Enforcement of Remedies
Pave
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Section 7 General Provisions
7.1 Further Assurances
7.2 Notices
7.3 Term of Agreement
7.4 Accounting Terms
7.5 Assignment and Security Interest
7.6 Stamp or Excise Tax
7.' No Waiver
7.8 Complete Agreement; Modifications
7.9 Severability
7.10 Persons Bound
7.11 Performance by Bank
7.12 Waiver and Release by Borrower
7.13 Participation
7.14 Consent to Jurisdiction. Servick and Venue
7.15 Waiver of Jury Trial
7.16 Descriptive -Headings
7.17 Governing Law
7.18 Counterparts
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EXHIBITS
A Note
B Litigation
C List of Franchise Aqreements, Pole Attachment Aqreements and
other Cable Aqreements
D Material Agref inn.ts
E Outstandinq Indebtedness
F Opinion .-f Borrower's Counsel
C Compliance Certificate
Fi
871105
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Glossary of Defined Terms
Term
Section
Pave
Accumulated Funding Deficiency
Section
2.24
Affiliate
Section
2.24
Annualized Cash Flow
Section
1.2(b)
Assessment Rate
Section
1.2(a)(ii)
Bank
Introduction
Borrower
Introduction
Cash Flow
Section
1.2(b)
CD Based Rate
Section
1.2(a)(ii)
CD Rate
Section
1.2(a)(ii)
CD Reserve.Adjustment Factor
Section
1.2(a)(ii)
Code
Section
2.24
Copyright Office
Section
2.13
Debt to Cash Flow Ratio
Section
1.2(b)
Employee Pension Plan
Section
2.24
ERISA
Section
2.24
Event of Default
Section
6.1
FCC
Section
2.9
Indebtedness
Section
2.22
LIBO Rate
Section
1.2(a)(ii)
LIBOR Based Rate
Section
1.2(a)(ii)
LIBOR Reserve Adjustment
Section
1.2(a)(ii)
Factor
Loan Documents
Section
3.1(a)(iv)
Loan(s)
Section
1.1(a)
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Maturity Date
Maturity Period
Multiemployer Plan
Note
PBGC
Pledge Agreement
Prime Based Rate
Proprietary Righta
Reorganization
Reportable Event
Reserve Adjusted CD Rate
Reserve Adjusted LIBO Rate
Revolving Credit Commitment
Revolving Credit Loan(s)
Revolving Credit Note
Senior Debt
System
TCID
Withdrawal Liability
Section 1.1(c)
Section 1.2(a)(ii)
Section 2.24
Section 1.2(a)
Section 2.24
Section 3.1(a)(ii)
Section 1.2(a)(i)
Section 2.16
Section 2.24
Section 2.24
Section 1.2(a)(ii)
Section 1.2(a)(ii)
Section 1.1(b)
Section 1.1(a)
Section 1.1(b)
Section 1.2(b)
Introduction
Section 3.1(a)(ii)
Section 2.24
4P
140AN AGREEMENT
THIS AGREEMENT is made an of October 31, 1987 by and
between MIAMI TELE-COMMUNICATIONS, INC., a Florida corporation
("Borrower"), and PROVIDENT NATIONAL BANK, a national banking
association ("Sank").
For the purposes of refinancing existing indebtedness
of Borrower and to finance certain capital expenditures of
'Borrower relating to Borrower's cable television system located
in Miami, Florida (the "System"), Borrower has applied to Bank
for revolving credit loans in the maximum aggregate outstanding
principal amount of $32,000,000; Bank is willing to grant such
revolving credit loans upon the termr and subject to the
conditions and restriction in uses h..:einafter set forth.
NOW, THEREFORE, in consideration of the premises and
intending to be legally bound hereby, the parties hereto agree as
follows:
SECTION 1. THE LOANS
1.1 The Revolvinv Credit Loans.
(a) Subject to and upon the terms and conditions
herein set forth and in reliance on the representations,
warranties and covenants of Borrower contained herein or made
pursuant hereto, Bank agrees to make loans (hereinafter
individually called the "Revolving Credit Loan" or the "Loan" and
collectively the "Revolving Credit Loans" or the "Loans") to..
Borrower during the period ending September 30, 1988, up to the
aggregate principal amount outstanding at any one time of
Thirty-two Million Dollars ($32,000,000). To effect a Revolving
Credit Loan hereunder, Borrower shall give Bank at least three
(3) business days prior written or telegraphic notice of a
Revolving Credit Loan which Borrower determines shall bear
interest at the LIBOR Based Rate (as hereinafter defined) or the
CD Based Rate (as hereinafter defined) and shall give Bank at
least two (2) business days prior written or telegraphic notice
of a Revolving Credit Loan which is to bear interest at the Prime
Based Rate (as hereinafter defined), specifying the amount of
each Revolving Credit Loan, the date such Revolving Credit Loan
is to be made, and. if applicable. the Maturity Period (as
hereinafter defined) for such Revolving Credit Loan. Requests
for Revolving Credit Loans must be received by Bank no later than
1:00 p.m. on a business day. Requests for Revolving Credit Loans
received by Bank after 1:00 p.m. on any business day shall be'
deemed to have been received by Bank as of 1:00 p.m. on the
following business day. Each request for a Revolving Credit'Loan
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which is to bear interest at the LIBOR Based Rate or the CD Based
Rate shall bs for a minimum of $1,000,000 and in integral
multiples of $500,000 for requests above the minimum amount.
Each request for a Revolving Credit Loan at the Prime Based Rate
shall be for a minimum of $250,000 and in integral multiples of
$100,000 for requests above the minimum amount.
(b) The aggregate outstanding principal amount of
the Revolving Credit Loans shall at no time exceed $32,000,000
(the "Revolving Credit Commitment"). Borrower may borrow, repay
without penalty or premium, and reborrow hereunde7
(c) The Revolving Credit Loans shall be evidenced
by, and bear interest as set forth in. Borrower's note in —
substantially the form of Exhibit A hereto (the "Revolving Credit
Note"), the principal and unpaid interest of which shall be due
and payable on demand, but if no demand is made by Bank, then on =
September 30, 1988 (the "Maturity Date"). _
1.2 Interest
(a) The Revolving Credit Note (sometimes referred —
to herein as the "Note") shall bear interest (computed on the
basis of the actual number of days eLapsed in a year of 365 (or
366, as the case may be) days with respect to interest at the
Prime Based Rate, and a year of 360 days with respect to interest =
at the LIBOR Based Rate or the CD Based Rate) on the principal —
amount thereof remaining unpaid from time to time. Unless
interest is to be paid more frequently as provided below, such
interest shall be payable quarterly in arrears on the last day of
each March, June, September and December, commencing December 31,
1987, and upon each payment of principal of the Note, including
prepayments (other than a partial prepayment of a Revolving
Credit Loan occurring on a day other than an interest payment
date where such Loan then bears interest at the Prime Based Rate)
or accelerated payments. Interest shall accrue and be payable at
the following rates:
(i) Except as provided in Subsection (ii)
hereof, the Note shall bear interest on the outstanding
principal balance of the Loans advanced hereunder at a rate
per annum not forth as follows (the "Prime Based Rate"):
(A) one percent (1%) above the prime rate in effect at Bank
from time to time during any period in which the Debt to
Cash Flow Ratio (as hereinafter defined) of Borrower is
greater than or equal to 7.0 to 1; and (B) one-half percent
(1/2%) above the prime rate in effect at Bank from time to
time during any period in which the Debt to Cash Flow Ratio
of Borrower is less than 7.0 to 1. The amount by which the
Prime Based Rate exceeds Bank's prime rate shall be
determined quarterly, based on the Debt to Cash Flow Ratio
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calculated with respect to financial information for the end
of the prior fiscal quarter. Any change in the amount by
which the.Prime Based Rate exceeds Bank's prime rate shall
be effective as of the first day of the fiscal quarter in —
which Bank receives such financial information as enables
Bank to determine the applicable Prime Based Rate. A change
in the Prime Based Rate as a result of a change in the prime
rate shall become effective on the same day as Bank _
announces a change in its prime rate. As used herein the
term "prime rate" shall mean the rate of interest which from
time to time is publicly announced by Bank as its prime
rate. This rate of interest is determined from time to time
by Bank as a means of pricing some loans to its customers
and is neither tied to any external rate of interest or
index, nor does it necessarily reflect the Lowe-t rate of t
interest actually charged by Bank to any partic.-.ar class or
:ategory of customers.
(ii) Upon receipt by Bank of at least three —
(3) business days' written or telegraphic notice from —
Borrower, Borrower may elect to have all or any portion of
the outstanding principal amount of the Revolving Credit
Loans (including the initial advance of any such Revolving
Credit Loan) in an amount equal to $1,000,000 or any
integral multiple of $500.000 for amounts in excess of
$1,000,000,.bear interest during the Maturity Period —
designated by Borrower in such notice at one of the
following rates:
(A) A rate per annum (the "LIBOR Based
Rate") equal to: (I) one and seven -eighths percent (1
7/8%) plus Bank's announced Reserve Adjusted LIBO Rate _
during any period -in which the Debt to Cash Flow Ratio
of Borrower,is greater than or equal to 7.0 to 1: and
(II) one and three -eighths percent (1 3/8%) plus Bank's -
announced Reserve Adjusted LIBO Rate during any period
in which the Debt to Cash Flow Ratio of Borrower is
less than 7.0 to 1. "Reserve Adjusted LIBO Rate" shall
mean the rate determined by dividing the LIBO Rate by
the LIBOR Reserve Adjustment Factor. As used herein,
the term "LIBO Rate" shall mean the rate, rounded
upwards to the nearest 1/100 of 1%. selected by Bank
from time to time two days prior to the date of the
Loan, as the rate at which Bank (or one or more other
reference banks selected by Bank) is offered deposits
for one, two, three or six months in United States
Dollars on such date of determination by banks in the
London interbank eurodollar market for delivery on the
first day of the relevant Maturity Period. As used
herein, the term "LIBOR Reserve Adjustment Factor"
shall mean the difference between 100% and the stated
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maximum percentage (calculated as of the date of
determination of the LIBO Rate for the relevant
Maturity Period and including all special and other
reserves) prescribed by the Board of Governors of the
Federal Reserve System (or any successor) as the
reserve requirement for a member bank of the Federal
Reserve System in Philadelphia with deposits exceeding
U.S. $500,000,000 in respect of liabilities or assets
consisting of or including Eurocurrency liabilities (as
defined in Regulation D of the Board of Governors of
the Federal Reserve System).
(B) A rate (the "CD Based Rate") equal
to: (I) two percent (2%) plus Bank's announced Reserve
Adjusted CD Rate during any period in which the Deht to
Cash Flow Ratio is greater than or equal to 7.O-to
and (II) one and one-half percent (1 1/2%) plus Bank's
announced Reserve Adjusted CD Rate during any period in -
which the Debt to Cash Flow Ratio of Borrower is less than 7.0 to 1. "Reserve Adjusted CD Rate" shall mean =
the rate determined by dividing the CD Rate by the CD
Reserve Adjustment Factor and adding the Assessment
Rate to the result. As used herein, the term "CD Rate"
shall mean the rate, rounded to the nearest
one -hundredth of one percent (1/100 of 1%), that Bank
determines it would pay, taking into consideration then --
prevailing rates on established certificate of deposit
dealer markets for certificates of deposit of a =
maturity of 30, 60, 90 or 180 days in effect on the
first day of the relevant Maturity Period, and the term
"CD Reserve Adjustment Factor" shall mean the
difference between 100% and the stated maximum
percentage (calculated as of the date of determination
of the CD Rate for the relevant Maturity Period and
including all special and other reserves) prescribed by
the Board of Governors of the Federal Reserve System
(or any successor) as the reserve requirement for a
member bank of the Federal Reserve System in
Philadelphia with deposits exceeding V.S. $500.000,000
in respect of non -personal time deposits. As used
herein, the term "Assessment Rate" shall mean the rate
(expressed as a percentage) determined by Bank to be
the actual (if known) or the estimated (if the actual
rate is not known) assessment rate (rounded up, if
necessary, to the next 1/100 of 1%) at which Bank pays
premiums to the Federal Deposit Insurance Corporation
(or any successor).for deposit insurance for time
deposits as in effect from time to time.
(C) As used herein. "Maturity Period"
shall mean one, two, three or six months, as designated
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by Borrower in its notice given pursuant to Subsections
1.1(a) or 1.2(a)(ii)(A), when all or any portion of the
Revolving Credit Loans bears interest at the LIBOR
Based Rate, and shall mean 30, 60, 90 or 180 days, as
designated by Borrower in its notice given pursuant to
Subsections 1.1(a) or 1.2(a)(ii)(B), when all or any
portion of the Revolving Credit Loans bears interest at
the CD Based Rate. Borrower shall pay all accrued
unpaid interest on the last day of the Maturity Period
then in effect, but in no event shall Borrower pay
interest less -frequently than quarterly. The amount by
which the LIBOR Based Rate exceeds Bank's announced
Reserve Adjusted LIBO Rate as set forth in (A) above
and the amount by which the CD Based Rate exceeds
Agent's Reserve Adjusted CD Rate as set forth in (B)
above shall be determined quarterly, based on the Debt
to Cash Flow Ratio calculated with respect to financial
information for the end of the prior fiscal quarter.
Any such change shall be effective on the day on which
Bank receives such financial information as enables
Bank to determine the applicable CD Based Rate or LIBOR
Based Rate, as the case may be. At the end of any
Maturity Period in respect of any principal outstanding
under the Note, the rate of interest borne by such
outstanding principal amount shall be the Prime Based
Rate unless Bank has received notice from Borrower
pursuant to Subsection 1.1(a) or 1.2(a)(ii)(A) or (B)
that Borrower elects to have all or a portion of such
principal amount bear interest at either the LIBOR
Based Rate or the CD Based Rate.
(D) In no event shall any Maturity
Period selected prior to the Maturity Date extend'
beyond the Maturity Date. In addition, at no time
shall the principal outstanding under the Revolving
Credit Notes be subject to more than four different
Maturity Periods or, if a portion of the principal
outstanding under the Notes bears interest at the Prime
Based Rate, be subject to more than three different
Maturity Periods.
(E) If Bank shall determine (which
determination shall be, in the absence of fraud or
manifest error, conclusive and binding upon the parties
hereto) that by reason of abnormal circumstances
affecting the interbank eurodollar market adequate and
reasonable means do not exist for ascertaining the LIBO
Rate to be applicable to the specified portion of the
Revolving Credit Loans, Bank shall give notice of such
determination by telephone; confirmed promptly in
writing, to Borrower at least one business day prior to
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the date that all or a portion of the Revolving Credit
Loans was to bear interest at the LIBOR Based Rate and
thereupon Bank shall not be obligated to honor _
Borrower's request that all or any portion of the
Revolving Credit Loans bear interest at the LIBOR Based
Rate. Borrower shall nevertheless have the right at
any time thereafter to submit another request that all or any portion of the Revolving Credit Loans bear _
interest at the LIBOR Based Rate.
(b) As used herein, (i) "Debt to Cash•Flow'Ratio"
shall mean the ratio of Senior Debt to Annualized Cash Flow; (ii)
"Senior Debt" shall mean the unpaid principal amount of the
Loans, together with all other Indebtedness (hereinafter defined) —
of Borrower not subordinated to the Loans (exclusive of accounts
payable and other liabilities accrued in the ordinary course of
business) outstanding during any fiscal quarter; (iii) "Cash
Flow" shall mean the net income (after adequate provisions for
all taxes and reserves) of Borrower for the relevant quarter
preceding the date of such determination. ascertained in
accordance with generally accepted accounting principles,
consistently applied, subject to the following adjustments: (A)
charges against income consisting of (1) depreciation of real and.
personal property; (2) amortization of franchise rights, good
will and other intangibles; (3) income taxes to the extent they
are deferred and not payable currently; (4) management fees
described in Section 5.9 that have been accrued but not paid; and
(5) interest on Indebtedness, shall be added back; and (B) all
extraordinary items of income or loss shall be excluded, and (iv)
"Annualized Cash Flow" shall mean the Cash Flow for the relevant
fiscal quarter in respect of which the Debt to Cash Flow Ratio is
calculated, multiplied by four.
® 1.3 Payments and Voluntary Prepayments
(a) Borrower at any time may prepay without any
penalty or premium the principal, or any portion of the
principal, of the Revolving Credit Notes. In connection with
each voluntary prepayment hereunder:
- (i) Borrower shall provide Bank with at
least three (3) business days prior written notice of its
intention to prepay;
(ii) Borrower shall concurrently with each
prepayment of principal (other than a partial prepayment of
a Revolving Credit Loan occurring on a day other than an '
interest payment date where such Loan then bears interest at
the Prime Based Rate) pay the full amount of interest
accrued on the principal sum to be prepaid;
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(iii) Each prepayment of principal shall be in
an amount equal to at least Five Hundred Thousand Dollars
($5O0,0O0.O0) (exclusive of the interest payable pursuant to
paragraph (ii) hereof); and
(iv) Except as hereinafter set forth or with
respect to a prepayment occurring on a day other than an
interest payment date of a Loan that then bears interest at
the Prime Based Rate, all prepayments shall be applied, to
the extent thereof, first to accrued interest on the prepaid
principal and then to reduce principal payments due on the
Note in the inverse order of its maturity.
(b) Notwithstanding the foregoing, repayment or
prepayment pursuant to this Section 1.3 of the principal or any —
portion of the principal of Note bearing interest at the LIBOR
Based Rate or the CD Based Rate may only be made without penalty
on the last day of a Maturity Period. In the event Borrower
repays or prepays the principal or any portion of the Note
bearing interest at the LIBOR Based Rate or the CD Based Rate
prior to the last day of a Maturity Period, Borrower shall also —
pay to Bank, such additional amount, if any (in each case as
specified by Bank in a certificate settinq forth the basis of
such -computation), as is necessary to compensate Bank for any
loss or costs incurred by it for the remainder, if any, of the
then current Maturity Period as a consequence of such repayment
or prepayment. Such amount shall be exclusive of the difference
between the LIBOR Based Rate and the Reserve Adjusted LIBO Rate -
or the difference between the CD Based Rate and the Reserve _
Adjusted CD Rate, as the case may be. Such certificate shall be
conclusive save for manifest error.
1.4 Reduction of Commitment. Borrower shall have the
right at any time and from time to time upon three business days' —
prior written notice to Bank to reduce permanently, in whole
multiples of $1,000,000 of principal, or terminate the Revolving
Cre-iit Commitment without penalty or premium except for any
liability arising under Section 1.3(b), if applicable, whereupon
the Revolving Credit Commitment shall be reduced or terminated by
the amount specified in such notice. Upon the effective date of
any such reduction or termination, Borrower shall pay to Bank (i)
the principal amount of the Revolving Credit Note to be prepaid,
together with the full amount of interest accrued on the
principal sum to be prepaid (other than a partial prepayment of a
Revolving Credit Loan occurring on a day other than an interest
payment date where such Loan then bears interest at the Prime
Based Rate), to the extent that the aggregate amount thereof then
outstanding exceeds Bank's Revolving Credit Commitment as so
reduced or terminated, and (ii) any amounts due pursuant to
Section 1.3(b). Reductions of the Revolving Credit Commitment of
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Bank shall not be subject to reinstatement without the prior
written agreement of Bank. _
1.5 Commitment Fee. Borrower shall pay to Bank a
Commitment Fee from the date hereof to the Maturity Date
(calculated on the basis of a 365 (or 366, as the case may be)
day year for the actual number of days involved) at the rate of
one -quarter of one percent (1/4%) per annum on the average daily =_
unused amount of the Revolving Credit Commitment of Bank, as
permanently reduced by prepayment or termination under Section
1.4 Such fee shall be payable in•arrears on the last day of
each calendar quarter, commencing on December 31, 1987. and on
the Maturity Date or upon the earlier termination of Bank's
Revolving Credit Commitment.
1.6 Facility Fee. Borrower shall pay to Bank on the
date hereof a facility fee equal to four -tenths of one percent
(4/10%) of Bank's total Revolving Credit Commitment.
1.7 Payments and Computations. (a) Borrower shall
make each payment hereunder and under the Note not later than
2:00 p.m.. local time, on the day when due in lawful money of the
United States, in immediately available funds at the office of
Bank at Broad and Chestnut Streets, Philadelphia, PA 19101.
Borrower hereby authorizes Bank, if and to the extent payment is
not made when due hereunder or under the Note, to charge -from
time to time against Borrower's account with'Bank any amount so
due. All computations of interest when the Loans bear interest
at the Prime Based Rate and all calculations of the Commitment
Fee shall be made by Bank on the basis of the actual number of
days elapsed in a year of 365 (or 366, as the case may be) days.
All other computations of interest and fees shall be made by Bank
on the basis of the actual number of -days elapsed in a year of
360 days. Should any payment of principal or interest or fees
become due and payable on a Saturday, Sunday or legal holiday
under the laws of the Commonwealth of Pennsylvania, the payment
date thereof shall be extended to the next succeeding business
day and such extension of time shall in such case be included in
computing such interest or fees, as the case may be. Any
payments made on the Note shall be applied first to the payment
of interest due and payable under such Note and then to the
reduction of the outstanding principal balance thereof.
(b) Bank's determinations of interest rates pursuant
to the provisions of this Agreement and determinations and
calculations of statements and confirmations sent to Borrower
with respect to outstanding Loans and payments due shall be
conclusive and binding on Bank and Borrower in the absence of
manifest error.
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SECTION 2. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce Bank to enter into this Agreement
and to make the Loan, Borrower represents and warrants to Bank
that:
2.1 Corporate Existence. Borrower is a corporation
duly organized and validly existing under the laws of the State
of Florida, and is duly qualified or licensed and in good
standing in'all other jurisdictions in which the character of the
properties !cased or owned or the nature of the activities
conducted by it makes such qualification or licensing necessary.
Borrower conducts its business directly through assets which it
owns directly and does not have an ownership interest in any
other business entity, or operate any portion of its cable
television systems through any other partnership, joint venture
or other entity.
2.2 Authority and Binding Effect. Borrower had and
has all requisite power and authority to own, lease, encumber and
operate its properties and assets and to carry on its business as
now being conducted and to enter into and to perform its
obligations under this Agreement and the other documents referred
to herein to which it is a party and to fulfill its obligations
set forth herein and therein, and Borrower has the legal power
and authority to issue the Note. The execution, delivery and
performance of this Agreement, the borrowing hereunder and the
execution and delivery of the Note and all other documents
incident to the transactions contemplated hereunder have been
duly authorized by all requisite corporate action on behalf of
Borrower and will not violate or constitute a default under any
provision of any applicable law, rule, regulation, order, writ,
judgment, injunction, decree, determination -or award presently in
effect or of the Articles of Incorporation of Borrower.•or of any
indenture, note. loan or credit agreement, franchise, license or
any other agreement, lease or instrument to which Borrower is a
party or by which Borrower or any of Borrower's properties are
bound. This Agreement constitutes and the Note and other
documents and instruments issued or to be issued hereunder, when
executed and delivered pursuant hereto, constitute or will
constitute the authorized, valid and legally binding obligations
of Borrower enforceable in accordance with their respective
terms.
2.3 &j2rovals. No consent or approval of any trustee
or holder of any indebtedness, nor any authorization, consent,
approval, license, exemption of or registration, declaration or
filing with any court or governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, is
or will be necessary to the valid execution and delivery of this
Agreement, the Note or the other documents contemplated hereunder
9
97--1105
q
or the consummation by Borrower of the transactions contemplated
by this Agreement, except such as have been obtained.
2.4 Recording and Enforceability. No recording,
filing, registration, notice or other similar action is required
in order to insure the legality, validity, binding effect or
enforceability of this Agreement or the Note or the other
documents and instruments executed hereunder as against all
persons.
2.5 isence of Judaments. Orders and Litiaation.
Except as set forth on Exhibit B hereto, there are no judgments
or other.judicial or administrative orders outstanding against
Borrower, nor is there any action, suit or proceeding at law or
in equity e- by or before any governmental or administrative
instrumenta+ity or other agency now pending or, to the knowledge
of Borrower, threatened against or affecting Borrower or any of
Borrower's property or rights which, if adversely de:.ermined.
might materially impair the right of Borrower to carry on its
business as it is now conducted or materially adversely affect
the financial condition of Borrower. Borrower is not in default
under any 'material portion of any material applicable statute.
rule, order, certificate or regulation of any governmental
authority having jurisdiction over Borrower.
2.6 Taxes. Borrower has filed all federal. state and
local tax returns, including information returns, which it is
required by law to file and has paid all taxes, assessments and
other governmental charges due in respect -of such returns, except
to the extent that any such taxes, assessments or other
governmental chargers are being contested in good faith and as to
which adequate reserves have been set aside.
2.7 Franchises. Licenses and Permits. Attached hereto
as a part of Exhibit C is an accurate and complete list of all
franchises, agreements, licenses and grants of authority issued,
granted or to be granted by any governmental authority or agency
permitting Borrower to operate the System or granting easements,
rights -of -way or construction permits in respect of the location
or construction of under ground or over ground cables or other
portions of the System. All of such franchises, agreements,
licenses and grants of authority were duly and validly issued by
the respective governmental authorities or agencies to Borrower
and are in full force and effect and are valid and enforceable in
accordance with their terms. There exists no fact or
circumstance which constitutes or which. with the passage of time
or the giving of notice or both, would constitute, a material
default under any such franchises, agreements, licenses or grants
of authority or would permit the grantor thereof to cancel or
terminate the rights thereunder, except upon the expiration of
the full term thereof. Borrows). has given the Bank true and
10
0
8 7--1105
'4 1
correct copies of such franchises which Borrower presently holds,
and all agreements, licenses and grants of authority (including
special ordinances), including all amendments thereto. Borrower
presently holds all franchises, agreements, licenses and grants
of authority as are necessary in connection with the conduct by
it of its business as now conducted and as presently proposed to
be conducted.
2.8 Utility Agreements. Attached hereto as a part of
Exhibit C is an accurate and complete list of all agreements with
power companies or telephoiis companies permitting Borrower to
utilize space on transmission poles or to utilize underground
cable facilities. Such agreements were duly and validly
authorized. are in full force and effect and are valid and
enforceable in accc-dance with their terms. and there exists no
fact or circumetanG4 which constitutes or which, with the passage
of time or the giving of notice, or both. would constitute. a _
material default under any such agreement or permit the other
party thereto to cancel or terminate the rights thereunder,
except upon.the expiration of the full term thereof. Borrower
has all agreements of the type described herein as may be
required or advisable under a reasonably prudent business
standard in connection with the conduct of its business as now
conducted and as proposed to be conducted.
2.9 Other Agreements. Except as set forth on Exhibit
A hereto, Borrower has no other material agreement with any
microwave or satellite transmission company or Federal
Communications Commission ("FCC") licensed commercial radio or
television. station and no such agreement is required or advisable
in connection with the conduct of its businesses as now conducted
or as presently proposed to be conducted.
2.10 Condition of System. The properties and equipment
of the System are in good repair, working order and condition and
are in compliance in all material respects with all standards or
rules imposed by any governmental agency or authority (including,
without limitation, the FCC or state or local governments or
instrumentalities) or as imposed under any agreements with power
companies or telephone companies.
2.11 Franchise and Utility Fees. Borrower has paid all
franchise, license or other fees and charges which have become
due pursuant to any franchise or license agreement in respect of
or pursuant to any pole attachment, conduit or similar agreements
and has made adequate provisions for any such fees and charges
which have accrued. except to the extent that Bank has been given
written notice that any such obligation is the subject of a good
faith dispute and adequate reserves have been set aside therefor.
11
2.12 Certificates. Licenses, Etc. Borrower hags duly
secured all necessary approvals, certificates and licenses from. _
and has filed all required notices with, the FCC and no further
certificate or license or notice is required to be issued to _
Borrower by reason of any matter or thing whatsoever. Borrower
is in compliance in all material respects with the Communications
Act of 1934, as amended, and the rules and regulations
thereunder.
2.13 Copyright Laws. Borrower is in full compliance
with all federal laws and all rules, regulations, orders.
policies and procedures of the United States Copyright Office
(the "Copyright Office") which are applicable to Borrower or to
the operation of its business, and has duly filed all Copyright
Statements of Account with the Copyright Office and paid all
necessary royalty fees shown as due thereon.
2.14 Guaranteed Obligations. Borrower has not directly
or indirectly guaranteed, become surety or accommodation party
for, endorsed (otherwise than for collection or deposit in the
ordinary course of business), discounted with recourse, or agreed
(contingently or otherwise) to purchase or repurchase, or
otherwise acquire any Indebtedness (as hereinafter defined) to
,any entity other than to Bank, nor agreed to supply or advance
funds to any person, firm, corporation or other entity.
2.15 Employment and Management Agreements. Borrower is
not a party to or bound by any employment or management agreement
except as set forth in Exhibit D hereto.
2.16 Trademarks, Patents, Licenses. Borrower possesses
all material trademarks, trademark rights, patents, patent
rights, licenses, permits, trade names, trade name rights, -
copyrights and approvals ("Proprietary Rights") which are
required to conduct its business as now conducted without
conflict with the rights or claimed rights of others. Borrower
does not know of any additional Proprietary Rights that are
required to conduct its business as now conducted without
conflict with the rights or claimed rights of others.
2.17 No Burdensome Agreements. Borrower is not a party
to any agreement or instrument or subject to any restriction
which has a materially adverse effect, financial or otherwise,
upon the assets or business of Borrower.
2.18 Material Agreements. Except as described in
Exhibit C hereto, or described in Exhibit C hereto, Borrower is
not a party to any material lease. contract, agreement,
understanding or commitment of any kind (such as employment
agreements, collective bargaining agreements, powers of attorney.
distribution agreements,.patent licence agreements, contracts for
12
�l
87"1105
it
future purchase or delivery oU goods or rendering of services,
bonus, pension and retirement plans, or accrued vacation pay,
insurance and welfare agreements) and Borrower has complied with
the provisions thereof in all material respects and no such party
is in default in any material manner under any thereof and no
event has occurred which, but for the giving of notice or the
passage of time, or both, would constitute a default.
2.19 No Notices of Violations. Borrower has not
received any notice, not heretofore complied with, from any
federal, state or local authority or any insurance or inspection
body to the effect that any of its properties, facilities,
equipment or business procedures or practices fail to` comply with
any applicable law, ordinance, regulation, building or zoning
law, or any other requirements of any such authority or body.
2.20 Title to Property. Borrower has good and
marketable title to its properties and assets and none of such
properties or assets is subject to any mortgage, pledge, lien,
security interest, lease, charge or encumbrance. Borrower has
not been a party either as lessor or as lessee to a leasing
transaction consummated pursuant to and in reliance on
Section 168(f)(8) of the Internal Revenue Code of 1986, as
amended, enacted as part of the Economic Recovery Tax Act of
1981.
2.21 No Misrepresentations or Material Nondisclosures.
Neither this Agreement nor any other document, certificate or
written statement furnished to Bank in connection herewith
contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements
contained herein and therein not misleading. There is no fact
known to Borrower which materially adversely affects the
business, operations, affairs, conditions, properties or assets
of Borrower which has not been set forth in this Agreement or in
the other documents, certificates and statements furnished to
Bank in connection with the transactions contemplated hereby.
2.22 No Other Indebtedness. Except as set forth on
Exhibit E hereto, Borrower does not have any outstanding
Indebtedness to any person or entity other than to Bank. For
purposes of this Agreement "Indebtedness" shall mean all items
which, in accordance with generally accepted accounting
principles, would be included in determining total liabilities
shown on the liability side of the balance sheet as at the date
Indebtedness is to be determined other than capital items such
capital stock, surplus and retained earnings, and exclusive of
accounts payable, and reserves for taxes in respect of income
as
as
Qezerrqu W rise sutiurs ana outer ae=errea creaiLs ana reserves,
and, in any event, shall include (i) liabilities secured by any
mortgage, pledge, lien or security interest on property owned or
13
87-1105
it 14
acquired, whether or not such a liability shall have been
assumed, (ii) liabilities in respect of all capitalized leases,
and (iii) the guarantees, endorsements (other than for collection
in the ordinary course of business) and other contingent
obligations whether secured or not in respect of the obligations
of other persons or entities.
2.23 Regulations U and X. Borrower does not own and no
part of the proceeds of the Loan will be used to purchase or
carry any margin stock (within the meaning of Regulation U of the
Board of Governors of the Federal Reserve System c to extend
credit to.others for the purpose of purchasing os. carrying any
margin stock. Borrower is not engaged principally, or as one of
its important activities, in the business of extending credit for
the purpose of purchasing or carrying'any margin stock. If
requested by Bank, Borrower will furnish ti) Bank a statement in
conformity with the requirements of Federal Reserve Form U-1
referred to in said Regulation. No part of the proceeds of the
Loan to Borrower will be used for any purpose which violates or
is inconsistent with the provisions of Regulation X of said Board
of Governors.
2.24 ERISA. As used in this Agreement the following
terms shall have the meanings indicated:
"Accumulated Funding Deficiency" means any
accumulated funding deficiency as defined in Section 302(a)
of ERISA.
"Affiliate" means (i) any corporation,included
with Borrower in a controlled group of corporations within
the meaning of Section 414(b) of the Code, (ii) any trade or
business (whether or not incorporated) which is under common
control with the -Borrower within the meaning of Section
414(c) of the Code, and (iii) any member of an affiliated
service group of which the Borrower is a member within the
meaning of Section 414(m) of the Code.
"ERISA" means the Employee Retirement Income
Security Act of 1974, as amended, and any regulations issued
thereunder by the Department of Labor or PBGC.
"PBGC" means Pension Benefit Guaranty Corporation.
"Employee Pension Plan" means any pension plan
which (1) is maintained by Borrower and (2) is subject to
Part 3 of Title I of ERISA.
"Code" means the Internal Revenue Code of 1986, as
amended, and any Treasury regulations, revenue rulings or
technical information releases issued thereunder.
14
87-i 105
4
"Multiemployer Plan" means a multiemployer pension
plan as defined in Section 3(37) of ERISA to -which Borrower
is or has been required to contribute subsequent to
September 25, 1980.
"Reportable Event" means,'with respect to any
Employee Pension Plan, an event described in Section 4043(b)
of ERISA.
"Reorganization" means reorganization as defined
in Section 4241(a) of ERISA.
"Withdrawal Liability" means any withdrawal
liability as defined in Section 4201 of ERISA.
Except as specifically disclosed to Bank in writir,y prior to the
date of this Agreement: (1) there is no Accumulated F;nding
Deficiency with respect to any Employee Pension Plan, (2) no
Reportable Event has occurred with respect to any Employee
Pension Plan, (3) Borrower has not incurred Withdrawal Liability
with respect to any Employee Pension Plan, and (4) no Employee
Pension Plan is in Reorganization. No liability (whether or not
such liability is being litigated) has been asserted against
Borrower in connection with any Employee Pension Plan or any
Multiemployer Plan by the PBCC, by the trustee of a trust
established pursuant to Section 4049 of ERISA, by a trustee
appointed pursuant to Section 4042(b) or (c) of ERISA, or by a
sponsor or an agent of a sponsor of a Multiemployer Plan, and no
lien has been attached and no person has threatened to attach a
lien on any of Borrower's property as a result of failure to
comply with ERISA or as a result of the termination of any
Employee Pension Plan. Each Employee Pension Plan, as most
recently amended, including amendments to any trust agreement.
group annuity or insurance contract, or other governing
instrument, is the subject of a favorable determination by the
Internal Revenue Service with respect to its qualification under
Section 401(a) of the Code. Borrower has furnished Bank with a
copy of the most recent actuarial report for each Employee
Pension Plan, and each such report is accurate in all material
respects. Borrower has no unfulfilled obligation to contribute
to any Multiemployer Plan.
2.25 No Event of Default. There has
which now constitutes, or with the passage of
of notice, or both, would constitute, an Event
defined in Section 6.1 hereof.
occurred no event
time or the giving
of Default as
2..27 Financial Information. Borrower's balance sheet
as of June 30. 1987 and statements of profit and lose and surplus
for the six months then ended (a) have been prepared in
accordance with generally accepted accounting principles
15
C2L/
8 7-1105
consistently applied, (b) are true and complete and present
fairly the financial condition and results of operations of
Borrower as of June 30, 1987 and for the period covered thereby,
and said balance sheet accurately reflects all liabilities,
including contingent liabilities of Borrower as of the date
thereof. Since June 30, 1987 Borrower has conducted its business In the ordinary course, and there has been no material adverse
change in the business, financial condition, operations or
affairs of Borrower except any such changes which have heretofore
been specifically disclosed by Borrower to Bank in writing.
All of the foregoing representations and warranties
shall survive the execution and delivery of the Note and the `-
making by Bank of the Loan hereunder and shall continue in full
force and effect so long as any indebtedness or obligation of
Borrower to Bank hereunder or otherwise is outstanding or =
unperformed or this Agreement remains in effect. _
SECTION 3. CONDITIONS OF LENDING
3.1 The Initial Loan. The obligation of Bank to make
the Initial Revolving Credit Loan hereunder is subject to the
provisions of Section 1 of this Agreement and fulfillment, to the
satisfaction of Bank and its counsel, on or before the date of
such Loan, of the following conditions precedent:
(a) Borrower shall have delivered to Bank the
following. all of which shall be in form and substance reasonably =
satisfactory to Bank and shall be duly completed and executed:
(I) The Note;
(ii) A Collateral Pledge and Security
Agreement (the "Pledge Agreement") under which TCI
Development Corporation ("TCID") pledges to Bank as security
for the Loan all of the outstanding capital stock of
Borrower, together with stock certificates representing such
stock, duly endorsed in blank with stock powers attached and
signatures guaranteed;
(iii) A loan purpose statement from Borrower
(Federal Reserve Form U-1);
(iv) Conformed copies of all documents .
evidencing necessary governmental or regulatory approvals
with respect to the execution, delivery and performance of
this Agreement, the Note and the Pledge Agreement
(collectively, the "Loan Documents") and the other documents
and transactions contemplated hereby;
16
c25
9'7-1105
A*
00
(v) Copies, certified by the secretary of
Borrower, of Borrower's articles of incorporation, bylaws,
and resolutions of its board of directors in effect on the
date hereof authorizing the execution, delivery and
performance of the Loan Documents to which it is a party;
(vi) Copies, certified by the Secretary of
TCID,-of TCID's articles of incorporation, bylaws, and
resolutions in effect on the date hereof authorizing the
execution, delivery and performance of the Pledge Agreement;
(vii) A written opinion of counsel to -Borrower
addressed to Bank in substantially the form of Exhibit F
attached hereto;
(viii) A written opinion of Borrower's FCC
Counsel in fo:,-m and substance reasonably satisfactory to
Bank;
(ix) A written opinion of Florida counsel to
the effect that (A) Bank's entering into and performing this
transaction will not require Bank•to qualify to do business
in, or to pay any taxes in, the State of Florida; (B) under
the laws of Florida there is no impairment of the validity
and enforceability of this Agreement, the Note or any of the
Loan Documents or any right or remedy thereunder except to
the extent that the enforceability thereof may be limited by
bankruptcy, insolvency or other laws relating to or
affecting creditors' rights generally; (C) the rate of
interest and any service charge and processing fee are not
usurious under the laws of the State of Florida; and (D)-
such other matters as Bank shall reasonably request;
(x) A certificate signed by the President or
Vice President of Borrower to the effect that (A) the
representations and warranties -set forth in Section 2 hereof
are true on and as of such date, (B) no Event of Default
hereunder, and no event which with the passage of time or
the giving of notice, or both, would become such an Event of
Default, has occurred and is continuing as of such date, and
(C) no material adverse change has occurred.in Borrower's
business or financial condition since the date of its most
recent financial statements;
(xi) Evidence of insurance required by
Section 4.9 hereof;
(xii) Evidence of flood insurance on any
properties in which the head ends or antenna are located, if
required by federal law;
17
8 7-1105
1 06
(xiii) Payment of the Facility Fee of $128,000;
and
(xiv) Such additional documents, certificates
and information as Bank may require pursuant to the terms
hereof or otherwise reasonably request.
(b) The representations and warranties set forth
in Section 2 hereof shall be true and correct on and as of such
date.
(c) No Event of Default hereunder, and no event
which, with the passage of time or the giving of notice, or both,
would become such an Event of Default shall have occurred and be
continuing.
(d) Borrower shall have paid the reasonable fees
and disbursements -Df Bank's counsel.
3.2 Subseauent Loans. The obligation of Bank to make
Loans subsequent to the initial Loan is subject to the provisions _
of Section 1 of this Agreement and the further conditions -
precedent that at the time each such Loan is requested or
scheduled to be made, no Event of Default hereunder and no event
which with the passage of time or the giving of notice, or both,
would become such an Event of Default, shall have occurred and be
continuing. Each request for a Loan hereunder and the acceptance —
of the proceeds thereof by Borrower shall be deemed to be a
representation and warranty by Borrower on the date thereof that -
all of the representations and warranties in Section 2 hereof are
true and correct on the date of such request, including without
limitation the representation and warranty set forth in Section
2.25,.e•ccept that the representation and warranties in
Section 2.26 shall refer to the financial statements most =
recently supplied to Bank pursuant to Section 4.1 hereof.
SECTION 4. BORROWER'S AFFIRMATIVE COVENANTS
Borrower covenants and agrees that so long as any
indebtedness of Borrower to Bank hereunder, or any future
indebtedness of Borrower to Bank is outstanding and unpaid, or
any obligation or undertaking to Bank of Borrower is not fully
performed:
4.1 Furnishing Financial Statements. Borrower will
furnish Bank:
(a) within 120 days after the close of each -
fiscal year of Borrower, a balance sheet and profit and loss and
surplus statement of Borrower, showing the financial condition of
. 1®
8 7-1105
I
Borrower, as of the close of such fiscal year and the results of
Borrower's operations during such fiscal year and certified
without qualification (except any qualifications as Bank may in
its discretion approve in writing) by such firm to have been
prepared in accordance with generally accepted accounting
principles consistently applied, accompanied by.the written
statement of such firm to the effect that such firm does not know
of the existence of any Event of Default,.or any event which,
with the passage of time or the giving of notice, or both, would
constitute such an Event of Default, or if such firm shall have
obtained knowledge of any such Event of Default or other event,
setting forth the nature thereof;
(b) within 75 days after the end of each of the
first three quarters of each fiscal year of Borrower. unaudited
financial statements comparable with those described in paragraph
(a) of this Section 4.1, as of the end of each such quarter and
for the then lapsed portioh of such year, certified by the chief
financial officer of Borrower to be true and correct and to have
been prepared in accordance with generally accepted accounting
principles consistently applied (subject to normal year-end
adjustments);
(c) accompanying the financial statements of
Borrower provided pursuant to paragraphs (a) and (b) of this
Section 4.1. a certificate of the president or chief financial
officer of Borrower in the form of Exhibit G attached hermto,
stating (i) that a review of the activities of Borrower during
such period has been made under his immediate supervision with a
view to determining whether all of the obligations and covenants
hereunder or in connection herewith have been performed and
fulfilled, (ii) that such review showed that there existed during
such period no Event of Default and no act, condition or event
which, with the passage of time or the giving of notice, or both,
would constitute such an Event of Default, or if any such Event
of Default, or act, condition or event existed, specifying the
nature thereof, the period of existence thereof and what action
Borrower proposes to take, or has taken, with respect thereto,
and (iii) that Borrower is in compliance with all terms,
conditions and provisions of this Agreement, the Note and all
other agreements between Borrower and Bank in all material
respects;
(d) within 30 days.after the end of the month,
internal monthly operating statements;
(e) upon request of Bank. copies of all reports,
proxy statements and financial statements delivered or sent by
Borrower to its shareholders or prospective investors and any
registration statements and reports filed by Borrower with the
Securities and Exchange Commission; and
19
8 7- tI05
(f) promptly after receipt thereof, all
recommendations or management letters submitted to Borrower by
its auditors (if any), in connection with any year end or interim
audit of Borrower's books.
All balance sheets, statements and other information
furnished pursuant hereto shall be prepared in accordance with
generally accepted accounting principles consistently applied and
shall fairly set forth the financial condition and the results of
operations of Borrower. Bank shall have the right, from time to
time, to discuss the affairs of Borrower directly with Borrower's
independent certified public accountants after notice to, and —
opportunity of, Borrower to be present at any such discussions.
Bank is authorized to show or deliver a copy of any financial
statement or any ether information relating to the business,
operations or financial condition of Borrower which may be
furnished to Bank or come to its attention pursuant to this
Agreement or otherwise, to any regulatory body or agency having
Jurisdiction over Bank and to any bank or other financial
institution which is a present or potential participant with Bank —
in the Loan.
4.2 Furnish Additional Financial Information.
Borrower will furnish Bank: -
(a) As soon as practicable, and in any event _—
within thirty (30) days of the end of each calendar month,
statements certified by an authorized financial representative of —
Borrower, in such detail and, if requested by Bank, on a form
supplied by Bank, accurately setting forth (i) the number of
homes passed in Borrower's System, (ii) the number of basic
subscribers, and (iii) the total number of pay T.V. subscribers.
(b) Upon request of Bank, all reports filed by
Borrower with the FCC and the U.S. Copyright Office relative to
the operations of Borrower, an opinion of Borrower's FCC counsel
relative to the operations of Borrower, and copies of all reports
filed with any other governmental agency other than such routine
reports filed under franchises or similar agreements; and
(c) With reasonable promptness, such other
information respecting the business, operations and financial
condition of Borrower as Bank may from time to time reasonably
— request.
4.3 Licenses and Permits. Borrower will maintain all
licenses. permits, franchises, easements, rights -of -way and pole
agreements, and all related or other agreements, necessary for
Borrower to operate the System, as the same may now exist or be
built, modified or expanded. Borrower will at all times comply
in ell material respects with any and all regulations, rules or
20
97-1105
1 01
requirements of any federal agency or department and of any
state, local or municipal government, agency or department which
may at any time have jurisdiction or power to regulate, license,
franchise or grant permits in respect of the facilities or
activities of Borrower, whether such regulations, rules or
requirements presently exist, -or are modified, promulgated or
implemented after the date hereof.
4.4 Maintenance of Properties. Borrower will keep its
properties in good repair, working order and condition. ordinary
wear and tear excepted, and, from time to time, make all
appropriate and proper repairs, renewals, -replacements, additions
and improvements thereto. and keep all systems and equipment
which may now or in the future be subject to compliance with
standards or rules imposed by any governmental agency or
a:ithority, including, without limitation, the FCC or state or
local governments or instrumentalities, in substantial compliance
with such standards or rules, and. upon Ba:.k's request therefor.
Borrower shall deliver to Bank notices filed with the FCC and
approvals, certificates and licenses issued by the FCC. The
equipment and systems shall also be installed and maintained by
Borrower in substantial compliance with any requirement imposed
under franchise or license agreements, permits and pole
attachment, conduit and similar agreements affecting the
Borrower.
4.5 Books and Records. Borrower will maintain proper
and complete financial and accounting books and records in which
shall be set forth accurately and in accordance with generally
accepted accounting principles all of its dealings and
transactions.
4.6 Taxes. Borrower will pay when due all taxes, ----
assessments,. charges and levies imposed upon it or any of its
properties or which it is required to withhold and pay over, and
provide evidence of such payment to Bank if requested. except
where such taxes, assessments or charges shall be contested in
good faith by appropriate proceedings and where adequate reserves
therefor have been not aside on its books,.provided that Borrower
will pay or cause to be paid all such taxes, assessments,
charges, and levies forthwith whenever foreclosure on any lien
that attaches l or security therefor) appears imminent. Within
ten (10) days of Bank's request therefor, Borrower will furnish
Bank with copies -of federal income tax returns (including
information returns) filed by Borrower.
4.7 Existence and Rights: Compliance with Laws.
Borrower will preserve and keep in full force and effect its
existence in the State of Florida and its Proprietary Rights, and
still comply with any and all laws, regulations, rules or,
requirements of any federal agency or department and of any
21
30
state, local or municipal government, agency or department which
may at any time be applicable to it.
4.8 Performance and Compliance with Material
Agreements. Borrower will perform and comply with each of the
_ material provisions of all material agreements of the kind =_
described in Section 2.18 hereof to which it is a party.
4.9 Insurance. Borrower will maintain insurance _
coverage by reputable insurance companies or associations in such
forms and amouro-_4 and against such hazards as are customary for
companies engaged in similar businesses and owning and operating
similar properties.
4.10 Inspection. Borrower will allow any
representative of Bank to visit and inspect any of the properties
of Borrower, to examine the books of account and other records
and files of Borrower, to make copies thereof and ..o discuss the
affairs, business, finances and accounts of Borrower with its
officers and employees, all at such reasonable times and as often
as Bank may request, provided that such inspections shall not
interfere with the reasonable conduct of Borrower's business. _
Bank's inspections are solely for the protection of Bank and no
action or inaction of Bank shall constitute any representation by
Bank that Borrower is in compliance with the terms of this
Agreement or that Bank approves of Borrower's affairs, business,
finances or accounts.
4.11 Leases and Mortgages. Borrower will pay all rent
or other sums required by any lease or mortgage to which it is a
party as the same becomes due and payable, duly perform and '
comply with all of its other material obligations as tenant or
mortgagor thereunder, except to the extent that any such —
obligation is the subject of a good faith dispute and adequate -
reserves have been set aside therefor, and keep all such leases
in full force and effect.
4.12 Pay Indebtedness and Perform Other Covenants.
Borrower will make full and timely payment of the principal of,
and interest on the Note and all other Indebtedness of Borrower
except, with respect to other Indebtedness of Borrower only, to
- the extent that any such obligation is the subject of a good —
faith dispute and adequate reserves have been set aside therefor
(provided, that nothing herein shall authorize payment of debt
subordinated to the Loan other than in accordance with the terms
of such subordination). whether now existinq-or hereafter
— arising, provided that for the purposes hereof.'amounts due under
pole attachment agreements or franchise fees shall be considered
due at the end of the period for which an invoice has been
rendered, or if no invoice has been rendered, at the and of the
period with respect to which such payment is due under the terms
22
3l
8'7-1105
I �%
— of the instrument providing for such payment, as long as such
payment procedure does not jeopardize Borrower's right to operate
the franchise or use the utility poles covered by such pole
attachment agreements; and Borrower will duly comply with all
covenants and agreements set forth in or required pursuant to any
of the Loan Documents or other agreement or document previously,
concurrently or hereafter executed or delivered by Borrower in
connection with this Agreement.
4.13 Litigation. Borrower will give prompt notice to
Bank of all litigation or proceedings affecting it which, if
adversely determined, might have a material adverse effect on its
financial or business condition or operations, or in which
damages exceeding $100,000 are claimed (whether or not the claim
is considered to be covered by insurance).
4.14 Notice of Defaults. Borrower will notify Bank
promptly of the occurrence of any Event of Default hereunder and
_ of the existence of any event which, with the passage of time or
the giving of notice, or both. would constitute such an Event of
Default.
4.15 Chanae of Business Location. Borrower will notify
Bank at least thirty (30) days in advance of any change in the
location of its principal place of business, or of the
establishment of any new. or the discontinuance of any existing.
place of business.
4.16 Bank's Expenses. Borrower will pay on demand all
of Bank's costs and expenses incurred in making and collecting
the Loans, including but not limited to the reasonable fees and
disbursements of legal counsel for Bank in connection with the
preparation, administration, amendment,-modificatior%, or
enforcement of this Agreement. the other Loan Documents and the
documents incident thereto, and in the exercise by Bank of any of
its rights hereunder, or under such documents including the
collection or attempted collection of the Note.
4.17 ERISA. Borrower will furnish to Bank (i) within
30 days after it has reason to know that it has incurred
Withdrawal Liability, or that any Multiemployer Plan is in
-Reorganization or that any Reportable Event has occurred with
respect to any Employee Pension Plan or that PBGC has instituted
or will institute proceedings under Title IV of ERISA to
terminate any Employee Pension Plan, or to appoint a trustee to
administer any Employee Pension Plan, a statement setting forth
the details as to such Withdrawal Liability, Reorganization.
Reportable Event or termination or appointment proceedings and
the action which it (or the Multiemployer Plan sponsor or
Employee Plan sponsor if other than Borrower) proposes to take
with respect thereto, together with a copy of any notice of
23
3:2 _
9 7-i105
I
Withdrawal Liability or Reorganization given to Borrower and a
copy of the notice of such Reportable Event given to-PBGC if a
copy of such notice is available to Borrower, and (ii) promptly
after receipt thereof, a copy of any notice Borrower or the
sponsor of any Employee Pension Plan receives from PBGC or the
Internal Revenue Service which sets forth or proposes any action
or determination with respect to such Employee Pension Plan.
Borrower will promptly notify Bank of any excise taxes which have
been assessed or which Borrower has reason to believe may be
assessed against Borrower by the Internal Revenue Service with
respect to any Employee Pension: Plan.
SECTION 5. BORROWER'S NEGATIVE COVENANTS
Borrower covenints and agrees that so long as any
Indebtedness of Borrower to Bank hereunder, or any future
Indebtedness of Borrower to Bank is outstanding and unpaid, or
any obligations or undertaking to Bank of Borrower is
unperformed, it will not, without the prior written consent of
Bank:
5.2 Dissolution and Merger. Wind-up, liquidate or
dissolve its affairs, convey, sell, lease or otherwise distribute
or dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its properties or
assets (whether now owned or hereafter acquired), or enter into
any transaction of merger or consolidation.
5.2 Other Borrowings and Liens. Incur, create, assume
or permit to exist any Indebtedness (either conventionally or by
sale/leaseback), or any mortgage, deed of trust, security
interest, pledge, lien, charge or other encumbrance -on ---any of its
properties or assets, whether now owned or hereafter acquired,
other than to Bank for money borrowed, except: (a) accounts and
other current payables arising in the ordinary course of
business; (b) liens for taxes, assessments or other similar
charges which are not delinquent or which are being properly
contested in good faith; (c) liens in connection with workmen's
compensation, unemployment insurance or other social security
obligations; (d) purchase money security interests in equipment
hereafter acquired not in excess of $500,000 per year; (e) leases
of equipment, the annual costs of which, when aggregated with the
costs described in.subparagraph (d) immediately above, do not
exceed the limitations therein set forth, where Borrower is
lessee. so long as any such lease is not a lease "intended as
security" within the meaning of Section 1201(37) of the V.C.C.;
(f) deferred liabilities other than for borrowed money,
consisting of deferred taxes, customer deposits and prepaid
service revenues; (q) performance bonds with franchisors and
utility companies; (h) statutory liens of mechanics, workmen and
24
33
9- 7-1105
contractors; (i) reservations, exceptions, encroachments,
easements, rights of way and other similar title exceptions
affecting the real property used by Borrower provided that such
title exceptions do not materially interfere with Borrower's use
of such property in the ordinary course of its business; and (j)
loans from TCID to Borrower subordinated on terms satisfactory to
Bank. Concurrently with incurring any such Indebtedness
permitted by (d), (e) or (j) above, Borrower shall promptly give
Bank written notice thereof and a copy of any document creating
such Indebtedness. None of such Indebtedness shall be secured by
any of the assets or rights of Borrow -at, except that Indebtedness
incurred to acquire cars, trucks, two-way.radio equipment for
vehicles, photocopiers, typewriters or other similar office
equipment, or data processing equipment may be secured by such
items.
5.3 Guaranties. Assume, guarantee, endorse or
otherwise in any way become liable on the obligation of any other
person. directly or indirectly, other than to or for the benefit
of Bank, except endorsements of negotiable instruments for
deposit or collection in the usual course of business.
5.4 Loans and Investments. Make any loans or
extensions of credit or purchase or otherwise acquire the capital
stock, assets, or obligations of, or any interest in, any person
or entity, or any non -operating real estate or other
non -operating assets except (a) loans or extensions of credit in
the ordinary course of business to customers. (b) temporary
advances to employees in the ordinary course of business, (c) the
purchase of direct obligations of the Government of the United
States of America or any agency or instrumentality thereof, (d)
interest -bearing certificates of deposit issued by any commercial
banking institution satisfactory to Bank, (e) stock or obliga-
tions issued in settlement of claims of Borrower against others
by reason of bankruptcy or a composition or readjustment of debt
or reorganization of any debtor of Borrower, (f) readily
marketable commercial paper rated "A-3" or better by Standard &
Poor's Corporation (or a similar rating by any similar
organization which rates commercial paper), (g) repurchase
agreements relating to government securities issued by any
commercial banking institution satisfactory to Bank, (h) shares
of money market funds issued by a banking institution
satisfactory to Bank, and (i) interest -bearing demand accounts
insured by either the Federal Deposit Insurance Corporation
(FDIC) or the Federal Savings and Loan Insurance Corporation
(FSLIC).
5.5
any capital to
distribution,
stockholders,
Dividends. Declare or pay any dividends or return
any of its stockholders or authorize or make any
payment or delivery of property or cash to its
or redeem, retire, purchase or otherwise acquire,
25 117' L
8'7-1105
i
directly or •indirectly. for consideration, any shares of any -
class of stock now or hereafter outstanding or set aside any
funds for any of the foregoing purposes.
5.6 Disposal of Assets. In any fiscal year of =
Borrower, sell, lease, transfer or otherwise dispose of any part
or any amount of its assets, whether such assets are real or
personal (including any sale or lease for the purpose of —
transferring tax benefits relating to ownership of any such
assets consummated pursuant -to and in reliance on Section
168(f)(8) of the Code), including its franchiLwk;, licenses and
permits and any accounts, contracts or contract rights, other
than in the usual course of business for value received.
5.7 Discontinuance or Channe of Business. Discontinue any substantial part of its business or change the nature of its —_
business or enter into a new business or change the legal form of
its business. -
5.8 Leases and Leasebacks. Enter into any new
agreement to rent or lease any real or personal property or enter
into any arrangement with any bank, insurance company or other
lender or investor providing for the leasing of any real or
personal property or equipment (a) which has been or is sold or
transferred by Borrower to such lender or investor or (b) which
has been or is being acquired from another person by such lender _
or investor or (c) on which one or more buildings have been or
are to be constructed by such lender or investor, for the purpose
of leasing such property to Borrower. Borrower may, however,
enter into such leases in the ordinary course of business.
5.9 Manavement Fees. During any fiscal year of -
Borrower, accrue or pay a management.fee to an affiliate of the -
Borrower for management services to Borrower pursuant to a
management agreement in excess of $6.00 per subscriber. In no _—
event may Borrower pay any management fees unless (a) after
giving effect to such payment no Event of Default exists, or with
the passage of time or the givinq of notice, or both, would exist
hereunder or under the Note. and (b) such payments are made after
Bank has received in good funds all principal. interest, fees and
prepayment charges due and payable hereunder and under the Note.
5.10 Stock Issuance. Issue any of its capital stock or
grant or issue any warrant, right or option pertaining thereto or
other security convertible into any of the foregoing.
5.11 Control. Enter into any agreement with any person
or entity which shall confer upon such person or entity the right
or authority to control or direct any of the business or assets
of Borrower.
FV
35
8 7-1105
5.12 Use of Proceeds. Directly or indirectly apply any
part of the proceeds of the Loan to the purchasing or carrying of
any "margin stock" within the meaning of Regulation U of the
Board of Governors of the Federal Reserve System•, or any
regulations, interpretations or rulings thereunder.
5.13 No Misrepresentations or Material Nondisclosure.
Furnish Bank any certificate or other document that will contain
any untrue statement of a material fact or that will omit to
- state a material fact necessary in order to make it not
misleading in light of the circumstances under which .1 gas
furnished.
SECTION 6. DEFAULTS AND RL-IWIFI.
6.1 Events of Default. Each of the following is an
event of default ("Event of Default") hereunder and under the
Note:
(a) Borrower fails to pay within 3 days after the
date when due, whether on demand or otherwise, any Indebtedness
to Bank hereunder, including but not limited to, principal of the
Note or any interest thereon, the Commitment Fee and the Facility
Fee.
(b) Borrower fails to comply with or perform as
and when required or to observe any of the terms, conditions or
covenants set forth in Sections 4 and 5 of this Agreement and
' such failure shall continue unremedied for a period of 20 days
after Bank shall give written notice to Borrower of such failure.
(c) Borrower fails to comply with or perform as
and when required or to observe any of the terms, conditions or
covenants'of this Agreement (other than Sections 4 and 5 hereof)
or the Note (other than payment) to be complied with, performed
or observed by Borrower, and such failure shall continue
unremedied for a period of 30 days after Bank shall give written
notice to Borrower of such failure, provided that if within such
30 day period Bank shall have received Borrower's written request
to extend such period, and Bank determines that Borrower is using
-all due diligence to cure such failure, then Bank may grant an
additional 30 days or such further time as Bank, in its judgment.
deems necessary to complete such cure.
(d) Any financial statement of Borrower or any
representation or warranty of Borrower made herein or in any
report, certificate or other document furnished iii connection
with this Agreement proves to be false or misleading in any
material respect.
27 3�
8 7-1105
14
(e) Any obligation of Borrower for the payment of
borrowed money which individually or in the aggregate is in
excess of $100,000 is declared to be due and payable prior to its
stated maturity or is 'not paid or discharged when due or within
any permitted grace period after such due date or there shall
occur any -event which constitutes, or which with the giving of
notice or the passage of time, or both,.would constitute an event
of default under any instrument, agreement or evidence of
Indebtedness of Borrower unless and to the extent only that
payment of or default under such Indebtedness, after notice —.
thereof having been given to Bank, is being contested in good
faith and by appropriate proceedings and such contest operates to
prevent the other party to such instrument, agreement or evidence
of Indebtedness from exercising its remedies against Borrower or
Borrower's properties.
(f) There occurs a default or event of default by
a�iy party other than Bank under any of the Loan Documents or any
other document or instrument delivered to Bank pursuant to or in
connection with this Agreement and such default or event of
default continues unremedied beyond any grace period, if any,
provided therein.
(g) Borrower or TCID makes an assignment for the --
benefit of its creditors or a composition with its creditors, or
is unable or admits in writing its inability to pay its debts as -
they mature, or files a petition in bankruptcy, or commences a
federal bankruptcy proceeding in which an order for relief or
such other court order or statutory provision which authorizes
the case to proceed is entered against it, or is adjudicated
insolvent or bar,Icrupt, .or petitions or applies_.to 'any.. tribunal
for the appointment of any custodian, receiver, liquidator or
trustee of or for it or any substantial part of its properties or
assets, or commences any proceeding relating to it under any
bankruptcy, reorganization, arrangement, readjustment of debt,
receivership, dissolution or liquidation law or statute of any
jurisdiction, whether now or hereafter in effect; or there is
commenced against Borrower or TCID any such proceeding which
shall remain undismissed for a period of 60 days, or an order for
relief, order, judgment or decree approvinq the petition in any
such proceeding is entered; or Borrower or TCID by any act or
failure to act indicates its consent to. approval of or
acquiescence in any such proceeding or in the appointment of any
custodian, receiver, liquidator or trustee of or for it or any
substantial part of its properties or assets, or suffers any such
appointment to continue undischarged or unstayed for a period of
60 days; or Borrower or TCID takes any corporate action for the
purpose of effecting any of the foregoing.
(h) Any final judgment, decree or order in excess
of $100.000 is entered against Borrower and the same remains
28
32
It
10
unsatisfied for more than 30 days, unless the same has been
appealed and a stay of the enforcement thereof has been obtained.
(i) Any attachment or execution process is issued
against all or any substantial.part of the assets of Borrower.
(j) The suspension by Borrower of all or any
significant part of its business operations.
(k) Any governmental agency or instrumentality
seizes, appropriates, condemns or occupies all or a substantial
part of the properties of Borrower or interferes in any
substantial manner with the operation of the business of
Borrower.
(1) If there shall occur or be threatened any
refusal or failu,.e by any municipality or other instrumentality
to renew or extend any cable television franchise or license
required for the operation of the System, or any permit with
respect thereto, or any termination of the franchise or license
prior to its expiration, or any denial, forfeiture or revocation
by the FCC of any authorization required by law, or any cable
television franchise, license or permit.
(ta) If there shall occur or be threatened any of
the events described in Section 4.13 (other than those described
in paragraph 6.1(1) hereof) and, in Bank's sole judgment such
event jeopardizes or could reasonably be expected to jeopardize
repayment of any..of the Note.
(n) (1)(A)(i) Any Employee Pension Plan is
terminated within the meaning of Title IV of ERISA, or (ii) a
trustee is appointed by the appropriate United States District
Court to administer any Employee Pension Plan, or (iii) PBGC
institutes proceedings to terminate any Employee Pension Plan or
to appoint a trustee to administer any Employee Pension Plan, or
(iv) any Reportable Event occurs which Bank determines in good
faith indicates a substantial likelihood that an event described
in (i), (ii) or (iii) above will occur, or (v) Borrower incurs
any Withdrawal Liability with respect to any Multiemployer Plan,
or (vi) any Multiemployer Plan enters Reorganization, and (B)
with respect to events described in (i) - (iv) above, only, the
benefit commitments (within the meaning of Section 4001(a) (16)
of ERISA) exceed the market value of the assets in the fund under
the Employee Pension Plan by 5% or more of Borrower's tangible
net worth or (2) there occurs an Accumulated Funding Deficiency
with respect to any Employee Pension Plata or (3) there occurs any
Accumulated Funding Deficiency with respect to any Employee
Pension Plan and Borrower fails'to correct such Accumulated
Funding Deficiency prior to the end of the correction period
within the meaning of Section 4971(c)(B) of the Code.
29
8'7-1105
6:2 Remedies. Upon or after the occurrence of any
Event of Default, Bank may, without demand of performance and
without other notice, do one or more of the following at its sole
option:
(a) declare the unpaid principal of and interest
on the Note and any or all other obligations of Burrower to Bank
now existing or hereafter created, to be immediately due and
payable,. whereupon the same shall become due and payable without
presentation, demand, protest or notice of any kind, all of which
are expressly waived, anything herein or in the Note to thq
contrary notwithstanding; and whereupon Bank may increase the
rate ofinterest on the Note to the lower of a rate 2 percent per
annum above the Prime Based Rate extant under the Note on the
date of the Event of Default or the highest aggregate rate of
interest permitted by :aw; and whereupon Bank may declare the
Revolving Credit Commitment and any obligation to make any
further Loans ant: Bank may proceed to protect and enforce Bank's
rights either by suit in -equity and/or by action at law, whether
for specific performance of any covenant or agreement contained
in this Agreement or the Note or in aid of the exercise of any
power granted herein or therein or proceed to obtain judgment or
any other relief whatsoever appropriate to the action or
proceeding, or proceed to enforce any other legal or.equitable
right of a holder of the Note;
(b) provided that Bank has not already increased
the rate under Section 6.2(a) above, after five days notice to
Borrower of its intention to do no, increase the'rate of interest
on the Note to the lower of 2 percent per annum above the Prime
Based Rate extant under the Note on the date of Event of Default
or the highest aggregate rate of interest permitted by law;
(c) set off, in such order as Bank may determine,
any or all of the unpaid principal of and interest on the Note
and any or all other obligations of Borrower to Bank, now
existing or hereafter created, against any or all of the property
of Borrower in Bank's possession at or subsequent to the Event of
Default regardless of the capacity in which Bank possesses such
property, including without limitation any balance or share of
any demand. time, savings, passbook, trust, agency, or escrow
account; and
(d) have and exercise each and every right and
remedy granted to it for a default under the terms of the Loan
Documents and any other document or instrument delivered to Bank
pursuant hereto (and notwithstanding that default under such
document or instrument containing such right or remedy shall not
have occurred), together with every right or remedy now or
hereafter available to Bank at law or in equity including,
without limitation. the rights and remedies granted to a secured
30 3g
f37 -1105
_1 1
party under the Uniform Commercial Code with respect to Section
7.5 hereof and the -Pledge Agreement.
6.3 Remedies Cumulative. All remedies of Bank
provided herein or in the Note or in any other document delivered
to Bank pursuant hereto (a) are cumulative and concurreAt, (b)
may be exercised independently, successively or together against
Borrower or its properties at the sole discretion of Bank, (c)
shall not be exhausted by any exercise thereof, but may be
exercised as often as occasion therefor may occur, and (d) shall
not be construed to be waived or released by Bank's delay in
exercising, or failure to exercise, them or any of them at any
time it may be entitled to do so.
6.4 Expenses of Enforcement of Remedies. Borrower
shall pay, upon demand, all expenses, including reasonable --
attorneys' fees and disbursements and court costs, of enforcing
any of Bank's rights and remedies upon an Event of Default.
SECTION 7. GENERAL PROVISIONS
7.1 Further Assurances. Borrower will, upon Bank's
request, execute and deliver to Bank such further documents and -
statements and do or cause to be done and pay the costs of such
further acts or things as Bank, in its sole discretion,
reasonably may require to effect the transactions contemplated
hereby or to vest or confirm any right or remedy herein granted
or to be informed of Borrower's status and affairs.
7.2 Notices. All notices given under this Agreement
shall be by personal service or by first class United States
mail, postage prepaid, return receipt requested, addressed to the
parties at the following addresses:
If to Borrower:
c/o Tele-Communications,
Regency Plaza One
Suite 600
4363 South Ulster Street
Denver, CO 80237
Attention:
If to Bank:
Inc.
Provident National Bank
P.O. Box 7648
Broad and Chestnut Streets
Philadelphia, PA 19101
Attention: Mr. Scott C. Meves
or to such other addresses as may be specified by like notice and
shall be deemed to have been duly given or made when delivered or
deposited in the mails, except that notices to Bank pursuant to
the provisions of Section 1 shall not be effective until received
by Bank.
7.3 Term of Agreement. This Agreement shall terminate
after payment in full of the Note and the discharge of all
obligations and undertakings of Borrower to Bank, whether arising
hereunder or otherwise.
7.4 Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with
generally accepted accounting principles consistently applied,
except as otherwise stated herein.
7.5 Assignment and Security Interest. Borrower hereby
assigns, and grants to Bank a continuing lien upon and security
interest in, any and all of its moneys, securities and other
property, and the proceeds thereof, now or hereafter held or
received by or in transit to Bank, from or for it, whether for
safekeeping, custody, pledge, transmission, collection or
otherwise. and also upon any and all of its deposits (general or
special) and credits with, and any and all of its claims against
Bank at any time existing including, without limitation, any
balance or share of any demand, time, savings. passbook, trust.
agency, escrow or like account, as collateral security for all
present and future Indebtedness of Borrower to Bank, whether
under this Agreement or any evidence of debt or other agreement
issued or made in connection herewith or otherwise. and whether
now existing or hereafter arising.
7.6 Stamp or Excise Tax. Should any stamp or excise
tax be payable in respect of this Agreement, the Note and the
other documents to be delivered hereunder, or any modification
hereof or thereof. Borrower shall pay the same and shall hold
Bank harmless from any and all liabilities with respect to or
resulting from any delay in paying or omission to pay such taxes.
7.7 No Waiver. Neither any failure or delay by Bank
in exercising any right, power or privilege hereunder or under
the Note shall operate as a waiver thereof: nor shall any single
or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or
privilege. No notice to or demand on Borrower in any case shall
entitle Borrower to any other or further notice or demand in
similar or other circumstances or shall constitute a waiver of
Bank's right to any other or further action in any circumstances
without notice or demand.
32
I
87-1105
7.8 Complete Agreement: Modifications. This Agreement
together with the Note, the other Loan Documents, and the other
documents delivered pursuant to this Agreement, constitutes the
full understanding between the parties hereto with respect to the
subject matter hereof, and no statements, written or oral, made
prior to or at the signing hereof shall vary or modify the terms -
hereof. No amendment, modification or release from any provision
hereof shall be effective unless in writing and executed by the
party to be charged therewith and shall be effective only in the
specific instance and for the specific purpose for which given.
7.9 Severability. If any provision of this Agreement
or the Note is prohibited or unenforceable in any jurisdiction,
it shall be ineffective in such jurisdiction only to the extent
of such prohibition or unenforceability, and such prohibition or
unenforceability shall not invalidate the balance of such
provision to the extent it is not prohibited or •inenforceable nor
the remaining provisions hereof, nor render unenforceable such --
provision in any other jurisdiction.
7.10 Persons Bound. This Agreement shall inure to the
benefit of, and shall be binding upon Borrower and Bank and their
successors and permitted assigns. Borrower may not assign any of its rights or obligations hereunder without the prior written =
consent of Bank. —
7.11 Performance by Bank. If Borrower shall fail to
observe or perform any of the terms, agreements or covenants
contained in this Agreement, or in any other document delivered -
to Bank in connection herewith,.Bank may, in its discretion, but --
without any obligation or duty to do so, and without waiving any
f default, perform any of such terms, agreements or.covenants,. in
part or in whole, and any money advanced or expended by Bark in
or toward the fulfillment of such terms, agreements or covenants,
shall be due on demand and become a part of and be added to the
indebtedness due under the Note and secured as herein provided
with interest thereon at the rate of 2% per annum above the Prime
Based Rate specified in the Note from the date of the respective
advance or expenditure.
7.12 Waiver and Release by Borrower. To the maximum
extent permitted by applicable laws, Borrower (a) waives protest
and notice of protest of the Note and notice and opportunity to
be heard before exercise by Bank of the remedies of self-help,
set-off, or of other summary procedures permitted by any
applicable laws or by any agreement with Borrower, and, except -_
where required hereby or by any applicable laws, notice of any —
other action taken by Bank; and (b) releases Bank and its
officers, attorneys, agents and employees from all claims for
loss or damage caused by any act or omission on the part of any
of them except willful misconduct. --
33
�1
8 7-1105
7.13 Consent to Jurisdiction. Service and Venue. For
the purpose of any suit, action or proceeding arising out of or
relating to this Agreement or the Note, Borrower hereby
irrevocably consents and submits to the jurisdiction and venue of
any of the -Courts of the Commonwealth of Pennsylvania or of any
Federal court located in Pennsylvania including, without
limitation, the Court of Common Pleas of Philadelphia County and
the Federal District Court for the Eastern District of
Pennsylvania, and appoints and conatitutes the Secretary of State
of the Commonwealth of Pennsylvania as its agent to accept and
acknowledge ).- its behalf all service of process in connection
with any such matter, copies of which process shall be mailed or
delivered to Borrower. Borrower irrevocably waives any objection
which it may now or hereinafter have to the laying of the venue
of any such suit, action or proceeding brought in such court and
any claim that such suit, action or proceeding brought in such a
court has been brought in an inconvenient forum and agrsses that
service of process in accordance with the foregoinq sentence
shall be deemed in every respect effective and valid personal
service of process upon Borrower. The provisions of this Section
7.13 shall not limit or otherwise affect the right of Bank or
Borrower to institute and conduct action in any other appropriate
manner, jurisdiction or court.
7.14 Waiver of Jury Trial. Borrower and Bank hereby
waive all right to a trial by jury in any litigation relating to
this Agreement, the Note or the other Loan Documents.
7.15 Descriptive Headings. The descriptive headings of
the sections and subsections hereof are for convenience of
reference only and shall in no way affect or be used to construe
or interpret this Agreement.
7.16 Governing Law. This Agreement, the Note, the
other Loan Documents, and each document incident thereto shall be
governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania.
7.17 Counterparts. This Agreement may be executed in
any number of counterparts with the same effect as if the
signatures thereto and hereto were upon the same instrument, but
all of such counterparts taken -together shall be deemed to
constitute one and the same instrument.
IN WITNESS WHEREOF, Borrower and Bank have caused this
34
43
8'7-1105
f
Agreement to be executed by their duly authorized officers as of
the date first above written.
(CORPORATE SEAL) MIAMI TELE-COMMUNICATIONS, INC.
Attest: By:
Title:
PROVIDENT NATIONAL BANK
By:
Title:
35
4/
8%-1105
n
STATE OF
ss
COUNTY OF
BEFORE ME, the undersigned authority, on this day
personally appeared , of Miami
Tele-Communications, Inc. a Florida corporation, known to me to
be the person and officer whose name is subscribed to the
foregoing instrument, and whc acknowledged to me that he executed
the same for the purposes and consideration therein expressed,
and as the act and deed of said partnership, and in the capacity
therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this day
of November, 1987.
Notary Public for the
State of
97 -1105
EXHIBIT A
NOTE
$32.000,000
Philadelphia, Pa.
October 31, 1987
For value received and intending to be legally bound,
MIAMI TELE-COMMUNICATIONS, INC. ("Borrower").hereby promises to
pay to the order of PROVIDENT NATIONAL BANK ("Bank") on demand,
and if no demand is made, then on September 30, 1988, the
principal sum of Thirty Two Million [collars ($32,000,000), or the
aggregate unpaid principal amount of all Revolvinq Credit Loans
made by Bank to Borrower pursuant to Section 1.1 of that certain
Revolving Credit Loan Agreement dated as of October 31. 1987 (the
"Loan Agreement") between Bank and Borrower, whichever is less,
and to pay interest from the date hereof on the unpaid principal
amount hereof quarterly in arrears, commencing on December 31,
1987 and on the last day of each March, June and September
thereafter and at maturity, at the applicable rate per annum
hereinafter set forth:
(i) Except as provided in Paragraph (ii)
hereof. this Note shall bear interest on the outstanding
principal balance hereunder at a rate per annum set forth as
follows (the "Prime Based Rate"): (A) one percent (1%)
above the prime rate in effect at Bank from time to time
during any period in which the Debt to Cash Flow Ratio (as
defined in the Loan Agreement) of Borrower is greater than
or equal to 7.0 to 1; and (B) one-half percent (1/2%) above
the prime rate in effect at Bank from time to time during
any period in which the Debt to Cash Flow Ratio of Borrower
is less than 7.0 to 1. The amount by which the Prime Based
Rate exceeds Bank's prime rate shall be determined
quarterly, based on the Debt to Cash Flow Ratio calculated
with respect to financial information for the end of the
prior fiscal quarter. Any change in the amount by which the
Prime Based Rate exceeds Bank's prime rate shall be
effective as of the first day of the fiscal quarter in which
Bank receives such financial information as enables Bank to
determine the applicable Prime Based Rate. A change in the
Prime Based Rate as a result of a change in the prime rate
shall become effective on the same day as Bank announces a
change in its prime rate. As used herein the term "prime
rate" shall mean the rate of interest which from time to
time is publicly announced by Bank as its prime rate. This
rate of interest is determined from time to time by Bank as
a means of pricing some loans to its customers and is
neither tied to any external rate of interest or index, nor
does it necessarily reflect the lowest rate of interest
actually charged by Bank to any particular class or category
of customers.
'qb
87-105
L
(ii) Upon receipt by Bank of at least three
(3) business days' written or telegraphic notice from
Borrower. Borrower may elect to have all or any portion of
the outstanding principal amount hereunder (including the
initial amount outstanding hereunder) in an amount equal to
$1,000,000 or any integral multiple of $1,000.000 for
amounts in excess of $500,000, bear interest during the
Maturity Period (hereinafter defined) designated by Borrower
in such notice at one of the following rates:
(A) A rate per annum (the "LIBOR Based
Rate") equal to: (I) one and seven -eighths percent (1
7/6%) plus Bank's announced Reserve Adjusted LIBO Rate
during any period in which the Debt to Cash Flow Ratio
of Borrower is greater than or equal 'o 7.0 to 1; and
(II) one and three -eighths parcent (1 3/8%) plus Bank's
announced Reserve Adjusted LIBO Rate during any period
in which the Debt to Cash Flow Ratio of Borrower is•
less than 7.0 to 1. "Reserve Adjusted LIBO Rate" shall
mean the rate determined by dividing the LIBO Rate by
the LIBOR Reserve Adjustment Factor. As used herein.
the term "LIBO Rate" shall mean the rate, rounded
upwards to the nearest 1/100 of 1%, selected by Bank
from time to time two days prior to the date of the
Loan, as the rate at which Bank (or one or more other
reference banks selected by Bank) is offered deposits
for one. two, three or six months in United States
Dollars on such date of•determination by banks in the
London interbank eurodollar market for delivery on the
first day of the relevant Maturity Period. As used
herein, the term•"LIBOR Reserve Adjustment Factor"
shall mean the difference between 100% and the stated
maximum percentage (calculated as of the date of
determination of the LIBO Rate for the relevant
Maturity Period and including all special and other
reserves) prescribed by the Board of Governors of the
Federal Reserve System (or any successor) as the
reserve requirement for a member bank of the Federal
Reserve System in Philadelphia with deposits exceeding
U.S. $500,000,000 in respect of liabilities or assets
consisting of or including Eurocurrency liabilities (as
defined in Regulation D of the Board of Governors of
the Federal Reserve System).
(B.) A rate (the "CD Based Rate") equal
to: (I) two percent (2%) plus Bank's announced Reserve
Adjusted CD Rate during any period in which the Debt to
Cash Flow Ratio is greater than or equal to 7.0 to 1;
and (II) one and one-half percent (1 1/2%) plus Bank's
announced Reserve Adjusted CD Rate during any period in
which the Debt to Cash Flow Ratio of Borrower is less
`a
`7 %
87-1105
94 A
than 7.0 to 1. "Reserve Adjusted CD Rate".shall mean
the rate determined by dividing the CD Rate by the CD
Reserve Adjustment Factor and adding the Assessment
Rate to the result. As used herein, the term "CD Rate"'
shall mean the rate, rounded to the nearest
one -hundredth of one percent (1/100 of 1%), that Bank
determines it would pay, taking into consideration then
prevailing rates on established certificate of deposit
dealer markets for certificates of deposit of a
maturity of 30, 60, 90 or 180 days in effect on the
first day of the relevant Maturity Period. .nd the term
"CD Reserve Adjustment Factor" shall mean the
difference between 100% and the stated maximum
percentage (calculated as of the date of determination
of the CD Rate for the relevant Matt+.rity Period and
including all special and other res,, ves) prescribed by
the Board of Governors of the Federal Reserve System
(or any successor) as the reserve requirement for a
member bank of the Federal Reserve System in
Philadelphia with deposits exceeding U.S. $500,000,000
in respect of non -personal time deposits. As used
herein, the term "Assessment Rate" shall mean the rate
(expressed as a percentage) determined by Bank to be
the actual (if known) or the estimated (if the actual
rate is not known) assessment rate (rounded up, if
necessary, to the next 1/100 of 1%) at which Bank pays
premiums to the Federal Deposit Insurance Corporation
(or any successor) for deposit insurance for time
deposits as in effect from time to time.
(C) As used herein, "Maturity Period"
shall mean one, two, three or six months; as designated
by Borrower in its notice given pursuant to Subsections
1.1(a) or 1.2(a)(ii)(A) of the Loan Agreement, when all
or any portion of the Revolving Credit Loans bears
interest at the LIBOR Based Rate, and shall mean 30,
60, 90 or 180 days, as designated by Borrower in its
notice given pursuant to Subsections 1.1(a) or
1.2(a)(ii)(B) of the Loan Agreement, when all or any
portion of the Revolving Credit Loans bears interest at
the CD Based Rate. Borrower shall pay all accrued
unpaid interest on the last day -of the Maturity Period
then in effect, but in no event shall Borrower pay
interest less frequently than quarterly. The amount by
which the LIBOR Based Rate exceeds Bank's announced
Reserve Adjusted LIBO Rate as set forth in (A) above
and the amount by which the CD Based Rate exceeds
Agent's Reserve Adjusted CD Rate as set forth in (B)
above shall be determined quarterly, based on the Debt
to Cash Flow Ratio calculated with respect to financial
information for the end of the prior fiscal quarter.
3
8 7-1105
Any such change shall be effective on the day on which
Bank receives such financial information as enables
Bank to determine the applicable CD Based Rate or LIBOR
Based Rate, as the case may be. At the end of any
Maturity Period in'respect of any principal outstanding
hereunder, the rate of interest borne by such
outstanding principal amount shall be the Prime Based
Rate unless Bank has received notice from Borrower
pursuant to Subsection 1.1(a) or 1.2(a)(ii)(A) or (B)
of the Loan Agreement that Borrower elects to have all
or a portion of such principal amount bear interest at
either the LIBOR Based Rate or the CD Based Rate.
(D) In no event shall any Maturity
Period selected prior to the Maturity Date ixtend
beyond the Maturity Date. In addition, at s:j time
shall the principal outstanding hereunder be subject to
more than four different Maturity Periods or, if a
portion of the principal outstanding hereunder bears
interest at the Prime Based Rate, be subject to more
than three different Maturity Periods.
(E) If Bank shall determine (which
determination shall be, in the absence of fraud or
manifest error, conclusive and binding upon the parties
hereto) that by reason of abnormal circumstances
affecting the interbank eurodollar market adequate and
reasonable means do not exist•for ascertaining the LIBO
Rate to be applicable to the specified portion of the
Revolving Credit Loans. Bank shall give notice of such
determination by telephone, confirmed promptly in
writing. to Borrower at least one business day prior to
the date that all .or a portion of the principal amount,
outstanding hereunder was to bear interest at the LIBOR
Based Rate and thereupon Bank shall not be obligated to.
honor Borrower's request that all or any portion of the
principal amount, outstanding hereunder bear interest
at the LIBOR Based Rate. Borrower shall nevertheless
have the right at any time thereafter to submit another
request that all or any portion of the principal
amount, outstanding hereunder bear interest at the
LIBOR Based Rate.
All such interest shall be calculated on the basis of
the actual number of days that principal is outstanding over a
year of 360 days with respect to the LIBOR Based Rate or the CD
Based Rate, and 365 or 365 days,• as•the case may be, with respect
to the interest at the Prime Based Rate. All payments of
principal and interest shall be made prior to 2:00 p.m., local
time, in lawful money of the United States, in immediately
available funds at the office of Bank, -Board and Chestnut
4
q9
87--1105
1^
Streets, Philadelphia, PA 19101. All payments made on account of
principal hereof shall be endorsed.on the reverse of this Note.
This Note evidences indebtedness incurred under, and is
entitled to the benefit of, the Loan Agreement,*as the same may
be amended from time to time, which, among other things, contains
provisions for acceleration of the maturity hereof and for a
higher rate of interest hereunder upon the happening of an Event
of Default (as defined therein).
[CORPORATE SEAL] MIAMI TELE-COMMUNICATIONS,
INC.
Attest:
Secretary
5
By: _
President
Sa
`3'7-1105
i
1
EXRIBIT B
Litiaation
15/
97--1105
EXHIBIT C
List all Franchise Agreements, Pole Attachment
Agreements and other Cable Agreements of Borrower
5Cox
EXHIBIT D
Material Acreemeat®
i
i
53 .
EXHIBIT E
putstandinc Indebtedness
5�
,97-ilos
0,
ot
EXHIBIT F
(OPINION OF COUNSEL TO BORROWER)
November —, 1987
Provident National Bank
Broad and Chestnut Streets
Philadelphia, PA 19101
Re: $32,000.000 Loan (the "Loan") from Provident
National Bank ("Bank") to Miami
Tole -Communications. Inc. (the "Borrower")
Gentlemen:
We have acted as counsel to the Borrower and TCI
Development Corporation ("TCID") in connection with the Loan to
be made by the Bank pursuant to a Loan Agreement dated as of
October 31, 1987 (the "Loan Agreement") between the Bank and the
Borrower. Except as otherwise defined herein, capitalized terms
shall have the meanings set forth in the Loan Agreement. In
connection with this transaction we have examined executed
counterparts of the following documents, all dated as of
October 31, 1987 unless otherwise indicated:
1. Loan Agreement;
2. Note; and
3. Pledge Agreement.
The agreements and documents numbered 1 through 3 above are
hereinafter collectively referred to as the "Loan Documents".
As counsel for the Borrower and TCID, we are generally
familiar with their affairs. As a further basis for this
opinion. we have made such factual inquiries of the officers of
the Borrower and TCID and have examined originals or copies,
certified or otherwise identified to our satisfaction of such
additional documents, corporate records and other instruments as
we have deemed necessary to enable us to give the opinion set
forth hereinafter, including:
55
6
a. Articles of Incorporation and Bylaws of
Borrower and TCID, as amended to date; and
b. Resolutions duly adopted by the Boards of
Directors of Borrower and TCID authorizing the execution,
delivery and performance of each of the Loan Documents to
which it is a party.
that: On the basis of the foregoing we are of the opinion
I. Each of the Borrower and TCID is a corporation
duly organized, validly existing and in good standing under the
lava of the State of and is duly qualified or licensed
and in good standing in all other jurisdictions in which the
character of the properties owned or the nature of the activities
conducted by it makes such qualification or licensing necesebry.
2. Each of the Borrower and TCID has all requisite
power and authority to carry on its business, to own, lease,
encumber and operate its properties and assets, to execute and
deliver each of the Loan Documents to which it is a party and all
other documents delivered to the Bank by the Borrower or TCID
pursuant to the Loan Agreement and to perform its obligations
thereunder and carry out the transactions contemplated therein.
3. The execution, delivery and performance of the
Loan Documents to which it is a party by each of the Borrower and
TCID has been duly authorized by all requisite corporate action
(no action by stockholders of Borrower or TCID being required by
law, Borrower's or TCID's Articles of Incorporation or Bylaws)
and such execution, delivery and performance will not (i) violate
any provision of the Articles of Incorporation or Bylaws of the
Borrower or TCID or any applicable law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award
presently in effect, applicable to the Borrower or TCID, or (ii)
conflict with, result in a breach of or constitute a default
under, any indenture, note, loan or credit agreement, license or
any other agreement, lease or instrument to which the Borrower or
TCID is a party, or by which Borrower or TCID or its properties
may be bound or affected or (iii) result in the creation or
imposition of any lien or encumbrance other than the liens
granted under the Loan Documents on any of the Borrower's or
TCID's properties; and neither the Borrower nor TCID is in
default under any such law, rule, regulation, order, writ,
judgment, decree, determination or award or any such indenture,
note, license, agreement, lease or instrument.
4. Each of the Loan Documents has been duly executed
and delivered by the Borrower or TCID, as the case may be and
constitutes the legal, valid and binding obligations of the
2
87-1105
A
01
Borrower or TCID, as the case may be, enforceable in accordance
with its terms, except as the same -may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar
laws or equitable principles affecting the enforcement of the
rights of creditors generally.
S. To the best of our knowledge, no consent or
approval of any trustee or holder of any indebtedness, nor any
authorization, consent, approval, license, exemption of or
registration, declaration or filing with, any court or
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, is or will be necessary to
the valid execution, delivery or performance of the terms of the
Loan Documents by the Borrower or TCID except those which have
been obtained.
6. To the best of our knowledge, there are no
judgments or other judicial or administrative orders outstanding
against the Borrower nor are there any actions, suits or other
proceedings pending, or threatened against or affecting the
Borrower or its properties before any court or governmental
department, commission, board, bureau, agency or instrumentality,
domestic or foreign, which, if determined adversely to the
Borrower would have a material adverse effect on the financial
condition, properties or operations of the Borrower. To the best
of our knowledge, the Borrower is not in default under any
applicable statute, rule, order, certificate or regulation of any
governmental authority having jurisdiction over the Borrower.
7. To the best of our knowledge, the Borrower has
obtained and validly holds all cable television franchises, FCC
licenses and all other permits or consents,-governmental-os
otherwise, necessary to carry on its business as now conducted.
To the best of our knowledge, each cable television franchise and
FCC license and each such permit or consent held by the Borrower
is in full force and effect and no event has occurred which
permits, or after notice or lapse of time or both would permit,
revocation or termination thereof or result in any other material
impairment of the rights of the holder thereof; and -to the best
of our knowledge, the Borrower has fulfilled and performed all of
its obligations with respect thereto.
(S. To the best of our knowledge, Borrower has good
and marketable title to all of its properties and assets, and
none of such properties or assets is subject to any mortgage,
pledge, lien. security interest, lease, charge or encumbrance,
other than those created by the Loan Documents or which have been
noted in any title policies or commitments in connection
therewith.)
3
J 7
g7-1105
9. Bank's entering into and performing this
transaction will not require Bank to qualify to do business in,
or to pay any taxes in, the State of Florida.
10. Under the laws of the State of Florida there is no
impairment of the validity and enforceability of the Loan
Agreement, the Note or any of the Loan Documents or any right or
remedy thereunder except to the extent that the enforceability
thereof may be limited by bankruptcy, insolvency or other laws
relating to or affecting creditors' rights generally.
11. The rate of interest and any service charge and
processing fee are not usurious under the laws of the State of
Florida.
Ver; truly yours,
-97-110s
EXHIBIT C --
COMPLIANCE CERTIFICATE
MIAMI TELE-COMMUNICATIONS, INC--
I have reviewed the financial statements of Miami
Tole -Communications, Inc. (the "Corporation") as of
and in my opinion, the financial statements
presently fairly the financial position of the Corporation.
In connection therewith, I have reviewed in reasonable
detail the activities and material transactions and conditions of
the Corporation during the accounting period covered by the _
enclosed financial statements with P view toward determining
whethar all of the obligations and covenants set forth in the
Loan Agreement dated as of October 31, 1987 or in connection -
therewith have been performed and fulfilled. Such review showed
that there existed during such period no Event of Default and no
act, condition or event which, with the passage of time or giving of notice, or both, would constitute such an Event of Default,
and that the Corporation is in compliance with all terms,
conditions and provisions of such Loan Agreement, the Note and all other agreements between the Corporation and Provident
National Bank.
Signed:•
® Title:
e ,-
w -
-j
1
i
E _
R
i
J -
3 '
3
9 7-1105
A57 86
COLLATERAL PLEDGE AND SECURITY ASREEME " fUNICATIONS
1907 N0V 16 RN 7. 0 t
THIS AGREEMENT is made this day of ,
1.987, between TCI DEVELOPMENT CORPORATION a
corporation ("TCID"I, and PROVIDENT NATIONAL BANK, a national
banking association ("Bank").
Bank and Miami Tele-Communications, Inc. a Florida
corporation and a wholly -owned subsidiary of T ("Borrower")
have entered into a Revolving Credit Loan Agreement (the "Loan
Agreement") of even date herewith pursuant to which Bank has
agreed to make revolving credit loans in an aggregate principal
amount of up to $32,000#000 (the "Loan") 'o Borrower against its
Note (the "Note") in the principal amount of $32,000,000.
Capitalized terms not otherwise defined herein shall have the
meaning given them in the Loan Agreement. As a condition to
entering into the Loan Agreement and making the Loan, Bank has
required the execution and delivery of this Agreement.
-NOW, THEREFORE, in consideration of the undertakings of
Bank pursuant to the Loan Agreement and as an inducement to Bank
to make the Loan provided for in the Loan Agreement, and
intending to be legally bound, the parties hereto agree as
follows:
1. Pledge of Securities.
(a) TCID hereby pledges, assigns and delivers to
Bank and grants to Bank a security interest in the shares of
capital stock set forth on Exhibit A attached hereto.and made a
part hereof, together with all proceeds and substitutions of any
thereof, all cash, stock and other monies and property paid
thereon, all rights to subscribe for securities declared or
granted in connection therewith, and all other cash and non -cash
proceeds of the foregoing (all hereinafter called the "Pledged
Collateral"), as security for the prompt repayment of the Note
and all obligations of Borrower pursuant to the Loan Agreement
(collectively, the "Secured Indebtedness"). The term Pledged
Collateral shall also include any securities, instruments or
distributions of any kind issuable, issued or received by TCID
upon conversion of, in respect of, on account of, or in exchange
or substitution for any other Pledged Collateral, including, but
not limited to, those arising from a stock dividend, stock split,
reclassification, reorganization, merger, consolidation, sale of
assets or other exchange of securities or any dividends or other
distributions of any kind upon or with respect to the Pledged
Collateral.
(b) The certificate or certificates for the
securities included in the Pledged Collateral, duly endorsed in
97-11U5
I
blank by TCID or accompanied by an instrument of assignment duly
executed in blank by TCID in either case with signatures
guaranteed by.a national bank or an investment banking firm which
is a member of the New York -Stock Exchange, have been, or will be
immediately upon the subsequent receipt thereof by TCID, accepted
by TCID as Bank's agent in trust for Bank and, delivered by TCID
to Bank.* Bank may at any time effect the transfer of any
securities included in the Pledged Collateral into the name of =
Bank or its nominees and cause new certificates representing such
securities to be issued in the name of Bank or its nominee.
2. Representations and Warranties. TCID represents
and warrants to Bank that:
(a) This Agreement has been duly authorized,
executed and delivered by TCID and such execution . d delivery
and the performance by TCID of TCID's obligations hereunder will
not violate any provision of law or any judgment, order or
regulation of any court or of any public or governmental agency
or authority applicable to TCID or of the articles of
incorporation or by-laws of TCID and will not conflict with or
constitute a breach of or a default under any agreement,
indenture or instrument to which TCID is a party or by which TCID or any of TCID's property is bound, and this Agreement
constitutes the legal, valid and binding obligation of TCID
enforceable in accordance with its terms;
(b) All of the Pledged Collateral has been
validly issued and is fully paid and nonassessable and is owned
by TCID free and clear of all security interests, liens.
encumbrances or other restrictions except the interest of Bank
pursuant to this Agreement and the possible restrictions on
transfer referred to in section S.2 hereof, and no disability or
contractual obligation exists which would prohibit TCID from
pledging the Pledged Collateral pursuant to this Agreement;
(c) TCID has full power and authority to create a
first lien on the Pledged Collateral in favor of Bank and upon
delivery of the Pledged Collateral to Bank or its agent, this
Agreement shall create a valid first lien upon and perfected
security interest in the Pledged Collateral subject to no prior
security interest, lien, encumbrance or other restriction; and
(d) The Pledged Collateral is not the subject of
any present or threatened suit, action. arbitration,
administrative or other proceeding, and TCID knows of no
reasonable grounds for the institution of any proceedings.
All the above representations and warranties shall
survive the making of this Agreement.
2
`37-1105
91
3. Covenants. TCID hereby covenants that, until all
of the Secured Indebtedness has been satisfied in full, it will:
(a) Not sell, convey or otherwise dispose of any
of the Pledged Collateral or any interest therein or create,
incur or permit to exist any pledge, mortgage, lien, charge or
encumbrance or any security interest whatsoever in or with
respect to any of the Pledged Collateral other than that created
hereby;
(b) Defend, at its own expense, Bank's right,
title and security interest in and to the Pledged Collateral
against the claims of any person, firm, corporation or other
entity.
4. Voting and Cash Dividends Prior to Default.
Unless an Event of Default hereunder shall have occurred and be
continuing, TCID shall be entitled to exercise any voting rights
with respect to the Pledged Collateral and to give consents,
waivers and ratifications in respect thereof, Provided that no
vote shall be cast or consent, waiver or ratification given or
action taken which would be inconsistent with any of the terms of
this Agreement, the Loan Agreement or any instrument executed and
delivered pursuant thereto, or which would constitute or create
any violation of any of such terms, or which would otherwise
cause a material decrease in the value of or other deterioration
of the Pledged Collateral. All such rights of TCID to vote and
give consents, waivers and ratifications shall cease if an Event
of Default hereunder shall occur and be continuing in which event
whether or not the Pledged Collateral shall have been registered
in Bank's or its nominee's name, Bank or its nominee shall have
the right to exercise all voting rights with respect to the
Pledged Collateral and any dividends shall be delivered by TCID
to Bank and, at Bank's option held as additional security
hereunder or applied toward satisfaction of the Secured
Indebtedness.
S. Events of Default. Each of the following shall
constitute an event of default ("Event of Default") hereunder:
(a). The occurrence of an Event of Default under
the Loan Agreement; or
(b) Failure by TCID to observe or perform any of
the provisions of this Agreement and such failure shall continue
unremedied for a period of 20 days after Bank shall give notice
to TCID of such failure; or
(c) Any representation or warranty of TCID made
herein proves to be false or misleading in any material respect.
3
all
9'7-1105
FA
6. Bank's Remedies Upon Default.
6.1 Upon the occurrence of an Event of Default, Bank
shall have the right to exercise all such rights as a secured
party under the Uniform Commercial Code of Pennsylvania (the
"U.C.C.")"as it, in its sole judgment, shall deem necessary or
appropriate, without demand of performance of other demand,
advertisement,.or notice of any kind (except the notice specified
below of time and place of public or private sale) to or upon
TCID or any other person (all of which are to the extent
permitted by law, hereby expressly waived by TCID, including the
right to sell all or any part of the Pledged Collateral at one or
more public or private sales at any exchange, broker's -board or
at any of Bank's offices or elsewhere; and any such sale or sales
may be made for cash, upon credit, or for future delivery, and in
connection therewith, Bank may grant options, provided that any
such terms or optio.is shall, in the beat judgment of Bank, be
extended only in order to obtain the best possible price. Bank
need not give more than five days notice of the time and place of
any public sale or of the time after which a private sale or
other disposition of the Pledged Collateral may take place. which
notice TCID hereby deems reasonable. No sale of any Pledged
Collateral upon a generally recognized securities exchange
through a registered securities broker will give rise to a credit
against the Secured Indebtedness until such broker credits Bank's
account with the sale proceeds. Bank may resort first to the
security created by this Agreement or first to the security
afforded by any other instruments, in any such case without
affecting Bank's rights under this Agreement.
6.2 TCID recognizes, that Bank may be unable to effect
a public sale of all or a part of the Pledged Collateral by
reason of certain prohibitions contained in the Securities Act of
1933, as amended (the "Act"), so that Bank may be compelled to
resort to one or more private sales to a restricted group of
purchasers who will be obliged to agree, among other things, to
acquire the Pledged Collateral for their own account, for
investment and without a view to the distribution or resale
thereof. TCID understands that private sales so made may be at
prices and on other terms less favorable to the seller than if
the Pledged Collateral were sold at public sales, and agrees that
Bank has no obligation to delay the sale of any of the Pledged
Collateral for the period necessary to permit the issuer of the
Pledged Collateral (even if the issuer would agree) to register
such securities for sale under the Act. TCID agrees that private
sales made under the foregoing circumstances shall be deemed to
have been made in a commercially reasonable manner. On any sale
of the Pledged Collateral, Bank is hereby authorized to comply
with any limitation or restriction compliance with which is,
necessary, in the view of Bank's counsel, in order to avoid any
violation of applicable law or in order to obtain any required
G3
9'7-1105
A
approval of the purchaser by any applicable governmental
authority.
6.3 After the sale of any of the Pledged Collateral,
Bank may deduct all reasonable legal and other expenses and
attorney's fees for preserving, collecting, selling and
delivering the Pledged Collateral and for enforcing its rights
with respect to the Secured Indebtedness, and shall apply the
residue of the proceeds to, or hold as a reserve against, the
Secured Indebtedness in such manner as Bank in its sole
discretion shall determine, and shall pay the balance, if any, to
TCID. To facilitate the exercise of Bank's remedies following an
Event of Default, TCID hereby appoints any officer of Bank as its
attorney -in -fact to collect and receive all payments in respect
of the Pledged Collateral, and to endorse the name of TCID
thereto for such purpose; and to apply such receipts to the
Secured Indebtedness and to execute on behalf of TCID all
financing statements and other documents necessary to perfect and
maintain Bank's security interest in the Pledged Collateral. The
remedies provided herein in favor of Bank shall not be deemed
exclusive, but shall be cumulative, and shall be in addition to
all other legal and equitable remedies which Bank may have, and
no delay on the -part of Bank in exercising any of its powers or
rights, or any partial or single exercise thereof, shall
constitute a waiver thereof.
7. Release of Pledged Collateral. Upon satisfaction
in full of the Secured Indebtedness and of all additional costs
and expenses of Bank as provided herein and performance of all
obligations of Bor•:ower under the Loan Agreement, this Agreement
shall terminate and Bank shall deliver to TCID, at TCID's
expense, such of the Pledged Collateral as shall not have been
sold'or otherwise applied pursuant to this Agreement.
S. Notices. TCID will promptly deliver to Bank all
written notices, and will promptly give Bank written notice of
any other notice, received by it with respect to the Pledged
Collateral, and, prior to the occurrence of an Event of Default,
Bank will promptly give like notice to TCID of any such notices
received by it or its nominee. Any notice required or permitted
by this Agreement shall be effective if given in accordance with
the provisions of the Loan Agreement.
9. Miscellaneous.
a) Other than the exercise of reasonable care to
assure the safe physical custody of the Pledged Collateral while
held by Bank hereunder, Bank shall have no duty or liability,
including without limitation, any obligation or duty to collect
any sums due in respect thereof or to protect or preserve any
rights against prior parties c•. any other rights pertaining
thereto and shall be relieved of all responsibility for the
e*1 '0
Pledged Collateral upon surrendering it or tendering surrender of
it to TC1D.
(h) MID, at its expense, will execute,
acknowledge and deliver all such instruments in form satisfactory
to Bank and take all such action as Bank from time to time may
reasonably require'in order further to effectuate the purposes of
this Agreement and to carry out the terms hereof, including
without limitation, delivering to Bank upon the occurrence of an
Event of Default irrevocable proxies with respect to the Pledged
Collateral. Until receipt thereof, this Agreement shall
constitute TCID's proxy to Bank or its nominee to vote all share
of the Pledged Collateral then registered in TCID's name.
(c) This Agreement shall inure to the benefit of
and shall be binding upon the successors and assigns of the
parties hereto.
(d) This Agreement and the rights and obligations
hereunder shall be construed in accordance with and governed by
the laws of the Commonwealth of Pennsylvania without regard to
principles of conflicts of law.
(e) The paragraph headings used herein are for
convenience only and do not affect or modify the terms and
conditions hereof.
(f) If any provision hereof ie found by a court
of competent jurisdiction to be prohibited or unenforceable, it
shall be ineffective only to the extent of such prohibition or
unenforceability, and such prohibition or unenforceability shall
not invalidate the balance of such provision to the extent it is
not prohibited or enforceable, nor invalidate the other
provisions hereof, all of which shall be liberally construed in -
favor of Bank in order to effect the provisions hereof.
6 � S
W-1105
IN WITNESS WHEREOF, the parties hereto have duly
executed this Agreement as of the day and year first above
written.
(Corporate Seal] TCI DEVELOPMENT CORPORATION
Attest By
Title Title
PROVIDENT NATIONAL BANK
By
Title
EXHIBIT A
PLEDGED COLLATERAL
Issuer No. and Class of Shares Certificate No.
13
CITY OF MIAMI. FLORIDA
INTER -OFFICE MEMORANDUM
TO. The Honorable Mayor and DATE: I`V RILE:
Members of the City Commission `
SUBJECT: Creditan
"Revolvi
Between Miami Tele-Com-
REFERENCES: m u n i c a t i o n s, Inc. a n d
FROM Cesar H. Odic'y'"�� Provident National Bank
City Manager ENCLOSURES:
Resolution
Recommendation:
It is respectfully recommended that the City Commission adopt the
attached Resolution approving the "Revolving Credit Loan
Agreement" between Miami Tele-Communications, Inc. and Provident
National Bank dated as of October 31, 1987, in substantially the
same form attached hereto.
Background:
The Department of Computers is submitting the attached Resolution
at the request of the cable television licensee. Miami Tele-
Communications, Inc. wishes to enter into the Revolving Credit
Loan Agreement for the purpose of expanding and upgrading its
-- facilities to better serve the citizens of the City of Miami.
Section 1610 of the City of Miami Cable Communications Ordinance
Number 9332 requires City Commission approval of the Revolving
Credit Loan Agreement.
CHO:REP:MSS
s:+"0TELEV t S ION SERVICE STAt it
I�
Numerous complaints against Miami Tele-Communicatlons, Inc. have
been received from citizens. These complaints Indicate that
subscribers are experiencing significant customer service
problems which are outside the parameters of acceptable business
practices and the spirit of the cable television license.
These customer service problems Include:
1. Long watts on the telephone to reach customer service
operator. Citizens experience either constant busy signals
or are placed on hold for extended periods of time.
This results In large numbers of lost customer telephone
calls.
2. Frequent missed Installation and service appointments.
Citizens stay home from work all day for a scheduled
appointment and the Installer or repair technician neither
shows up, nor calls to cancel.
A reduction of complaints and Improvement of service to citizens
would result If Miami Tele-Communications, Inc. were required to
meet the following cable television service standards:
1. Not less than 95% of all customer service and repair
calls shall be answered within two minutes by a human voice
on a twenty-four hour, seven day a week basis.
2. The rate of lost calls, Including Incoming calls
abandoned, shall be less than five percent.
3. Missed repair and installation appointments, due to
reasons which are not the fault of the customer, shall be
less than five percent.
4. Customers may request Installation and repair
appointments be scheduled between the hours of 8:00 AM and
Noon, or 1:00 PM and 5:00 PM, or 6:00 PM and 9:00 PM.
5. The Information required to monitor these standards
shall be provided to the City on a monthly basis not later
than seven business days after the first of each month for
the previous month by Miami Tele-Communications, Inc.
S. Miami Tele-Communications, Inc. shall have 60 days to
meet these service standards.
7. In the event Miami Tele-Communications, Inc. does not
meet these standards within 60 days and continue to maintain
them throughout the remainder of Its license term, the City
Manager shall initiate the necessary steps to find It In
noncompliance.
8. Additional service levels may be established through
mutual agreement between the City Manager and Miami Tele-
Communlcatlons, Inc.
R7-1105
...;...�=rises
:tW
NUMBER OF CATEGORIZED COMPLAINTS
AGAINST MCV/MTCI FOR 1986/1987
COMPILED BY CITY OF MIAMI CABLE COMMUNICATIONS
1986 1981
700
650
600
550
500
450
400
350
300
250
200
150
100
50
0
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
JAN.15,1987: TCI AQUIRES 100% OWNERSHIP OF CABLE COMPANY
JUNE 1,1987: TCI BEGINS MAJOR SERVICE AND TECHNICAL. CHANGES
9 7-1105
F
i
i
NUMBER OF CATEGORIZED COMPLAINTS
AGAINST MCV/MTCI FOR 1986/1987
COMPILED BY CITY OF MIAMI CABLE COMMUNICATIONS
1986 1981
170
160
150
140
130
120
110
100
90
80
10
60
50
40
30
20
10
0
SERVICE OUTAGES
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
JAN.1511987: TCI AQUIRES 100% OWNERSHIP OF CABLE COMPANY
JUNE 1.1987: TO BEGINS kWOR SERVICE AND TECHNICAL CHANGES
NO WTAM ON NOrVFa BM 1986
9 7-1105
F,
f
T
9c...:
j 4 �
}
5 Lt,
N
n r
NUMBER Of CATEGORIZED COMPLAINTS
AGAINST MCV/MTCI FOR 1986/1987
COMPILES BY CITY OF MIAMI CABLE COMMUNICATIONS
1986 1981
170
160
150
140
130
120
110
100
90
80
7(
V
5(
4(
3(
21
11
TELEPHONE
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
JAN.15,1987: M ACQUIRES 100% OWNERSHIP OF CABLE COMPANY
JUNE 1.1987: M BEGINS MAJOR SERVICE AND 1ECNICAL CHANGES
97—i105
c
a
i
t
i
at
'
i1
R�'. J77
NUMBER OF CATEGORIZED COMPLAINTS
AGAINST MCV/MTCI FOR 1986/1987
COMPILED BY CITY OF MIAMI CABLE COMMUNICATIONS
1986 1981
UNKEPT APPOINTMENTS
170
160
150
140
130
120
110
100
90
80
70
60
50
40
30
20
10
0
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
JAN.15,1987: TCI AQUIRES 100% OWNERSHIP OF CABLE COMPANY
JUNE 1,1987: TCI BEGINS MAJOR SERVICE AND TECHNICAL CHANGES
F�
R7-1105 t