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Exhibit 10.3
GENERAL GUARANTEE
GENERAL GUARANTEE, dated July 30, 1996, by and among
InterMedia Partners of West Tennessee, L.P., a California limited partnership
(the "Guarantor"), in favor of The Bank of New York (the "Agent"), as agent for
the financial institutions (the "Lenders") party to the Credit Agreement
referred to below, and the Lenders (the Agent and the Lenders being referred to
herein collectively as the "Creditors").
Capitalized terms used herein and not otherwise defined shall
have the meanings ascribed to them in the Revolving Credit and Term Loan
Agreement, dated as of July __, 1996, among InterMedia Partners IV, L.P. (the
"Borrower"), the arranging agents and syndication agents named therein, the
Lenders and the Agent (as the same may from time to time be amended, modified or
supplemented, the "Credit Agreement").
1. Guarantee. For value received, and to induce the Creditors
to make the Loans or otherwise extend credit from time to time to or for the
account of the Borrower pursuant to the terms of the Credit Agreement, the
Guarantor unconditionally and irrevocably guarantees to the Creditors, their
successors, endorsees and assigns, the prompt payment when due of all present
and future obligations and liabilities of all kinds of the Borrower to any of
the Creditors based on, arising out of, or otherwise relating to the Credit
Documents, whether incurred by the Borrower as maker, endorser, drawer,
acceptor, guarantor, accommodation party or otherwise, and whether due or to
become due, secured or unsecured, absolute or contingent, joint or several, and
howsoever or whenever incurred by the Borrower (the "Obligations").
2. Absolute Guarantee. The Guarantor's obligations hereunder
shall not be affected by the genuineness, validity, regularity or enforceability
of the Obligations or any instrument evidencing any Obligation, or by the
existence, validity, enforceability, perfection, or extent of any collateral
therefor or by any other circumstance relating to the Obligations which might
otherwise constitute a defense to this Guarantee. The Creditors make no
representation or warranty with respect to any such circumstance and have no
duty or responsibility whatsoever to the Guarantor with respect to the
management and maintenance of the Obligations or any collateral
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therefor. The Creditors shall not be obligated to file any claim relating to the
Obligations in the event that the Borrower becomes subject to a bankruptcy,
reorganization or similar proceeding, and the failure of the Creditors to so
file shall not affect the Guarantor's obligations hereunder.
The Guarantor authorizes the Creditors, without notice to,
demand of, or consent from the Borrower or the Guarantor, and without affecting
its liability to the Creditors hereunder, from time to time (a) to renew,
extend, accelerate or otherwise change the time or place for payment of, or
otherwise change the terms of, the Obligations or any part thereof including,
without limitation, to increase or decrease the rate of interest thereon; (b) to
take and hold security for the payment or performance of the Obligations and
exchange, enforce, waive, surrender, modify, impair, change, alter, renew,
continue, compromise or release in whole or in part any such security, or fail
to perfect its interest in any such security or to establish its priority with
respect thereto; (c) to apply such security and direct the order or manner of
sale thereof as the Creditors in their sole discretion may determine; (d) to
release any other guarantor, in whole or in part, from any or all of the
Obligations or substitute any or all of the obligations of any other guarantor;
(e) to settle or compromise any or all of the Obligations with any other
guarantor or any endorser of the Obligations; and (f) to subordinate any or all
of the Obligations to any other obligations of or claim against any other
guarantor, whether owing to or existing in favor of the Creditors or any other
party. The Guarantor shall be and remain bound hereunder notwithstanding any
such renewal, extension, acceleration, change, taking, holding, exchange,
enforcement, waiver, surrender, modification, impairment, alteration,
continuation, compromise, release, failure, application, direction,
substitution, settlement or subordination.
In the event that the Borrower or any other guarantor becomes
insolvent or files a petition for reorganization, arrangement, composition,
discharge or similar relief under any present or future provision of the
Bankruptcy Code, or if such a petition be filed against the Borrower or any
other guarantor, and in any such proceedings some or all of the Obligations
shall be terminated or rejected or any of the Obligations modified or abrogated,
the Guarantor agrees that its liability hereunder shall not thereby be affected
or modified, and such liability shall continue in full force and effect as if no
such action or proceeding had occurred and shall continue to be effective
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or reinstated, as the case may be, if any payment of any of the Obligations must
be returned by any Creditor upon such insolvency, bankruptcy or reorganization,
or otherwise, as though such payment had not been made.
The Guarantor waives any and all statutory or other right
which the Guarantor may otherwise have to require the Creditors to (a) proceed
against the Borrower or any other guarantor; (b) proceed against or exhaust any
security from the Borrower or any other guarantor; or (c) pursue any other
remedy in their power whatsoever. The Creditors may, at their election, exercise
any right or remedy they may have against the Borrower or any other guarantor or
any security now or hereafter held by or for the benefit of the Creditors
including, without limitation, the right to foreclose upon any such security by
judicial or nonjudicial sale, without affecting or impairing in any way the
liability of the Guarantor hereunder except to the extent the Obligations may
thereby be paid. Only the net proceeds from any such foreclosure, after
deduction of all reasonable costs and expenses authorized to be deducted
pursuant to the documents under which such security is held or by law, shall be
applied against the Obligations. Any one or more of the Creditors may at their
discretion purchase all or any part of such security so sold or offered for sale
for their own account and may apply against the amount bid therefor all or any
part of the Obligations for which such security is held; and in such case, only
that portion of the proceeds realized, after deduction of all reasonable costs
and expenses authorized to be deducted pursuant to the documents under which
such security is held or pursuant to law, shall be applied against the
Obligations. The Guarantor waives any defense arising out of the absence,
impairment or loss of any right of reimbursement or subrogation or other right
or remedy against the Borrower or any other guarantor or any such security,
whether resulting from the election by the Creditors to exercise any right or
remedy they may have against the Borrower or any other guarantor, any defect in,
failure of, or loss or absence of priority with respect to the interest of the
Creditors in such security, or otherwise. In the event that any foreclosure sale
is deemed to be not commercially reasonable, the Guarantor waives any right that
it may have to have any portion of the Obligations discharged except to the
extent of the amount actually bid and received by the Creditors at any such
sale. The Creditors shall not be required to institute or prosecute proceedings
to recover any deficiency as a condition of payment hereunder or enforcement
hereof.
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The Guarantor acknowledges that repeated and successive
demands may be made and payments or performance made hereunder in response to
such demands as and when, from time to time, the Borrower may default in
performance of the Obligations. Notwithstanding any such performance hereunder,
this Guarantee shall remain in full force and effect and shall apply to any and
all subsequent defaults by the Borrower in payment or performance of the
Obligations.
The Guarantor waives any setoff, defense or counterclaim which
the Guarantor may have or claim to have against any Creditor.
3. Representations and Warranties. The Guarantor
hereby represents and warrants that:
(a) Partnership Power. The Guarantor has full power and
authority to execute, deliver and perform this Guarantee and to incur
the obligations provided for herein, all of which have been duly
authorized by all proper and necessary partnership action. No consent
or approval not heretofore obtained and in full force and effect of its
partners, or of the shareholders of any such partners, is required as a
condition to the validity or performance of, or the exercise by the
Creditors of any of their rights and remedies under, this Guarantee
(other than the execution of this Guarantee by its general partner).
(b) Binding Agreement. This Guarantee constitutes the valid
and legally binding obligation of the Guarantor, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(c) No Conflicts. There is no statute, regulation, rule, order
or judgment, and no provision of any agreement or instrument binding on
the Guarantor or affecting its properties and no provision of the
partnership agreement of the Guarantor or any general partner thereof
which would prohibit, conflict with or in any way be inconsistent with
or prevent the execution, delivery, or performance of this Guarantee or
result in or require the creation or imposition of any material Lien on
any of the properties of the Guarantor as a consequence of the
execution, delivery and performance of this Guarantee or the
consummation
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of the transactions contemplated hereby; and the execution, delivery
and performance by the Guarantor of this Guarantee and the consummation
of the transactions contemplated hereby do not (i) violate any
provision of law applicable to the Guarantor or its general partner,
the partnership agreement of the Guarantor or the partnership agreement
of its general partner, or any order, judgment or decree of any court
or other agency of government binding on the Guarantor or its general
partner, (ii) conflict with, result in a breach of or constitute (with
due notice or lapse of time or both) a default under any material
agreement or instrument affecting their properties or (iii) require any
approval of partners (other than the execution of this Guarantee by the
general partner of the Guarantor) or any approval or consent of any
Person under any agreement or instrument binding on the Guarantor or
its general partner or affecting their properties, other than approvals
or consents (a) which have been previously obtained and are in full
force and effect or (b) the absence of which could not reasonably be
expected to have a Material Adverse Effect.
(d) Credit Decision. The Guarantor has made its own credit
analysis with respect to the Borrower and the Obligations and has made
such arrangements with the Borrower not inconsistent with the
provisions hereof as it has deemed appropriate.
(e) Litigation. Other than proceedings affecting the cable
television industry generally, there are no proceedings, investigations
or labor controversies pending or, so far as the Guarantor knows,
threatened before any court or arbitrator or before or by any
Governmental Authority which, in any one case or in the aggregate, if
there is a reasonable possibility of a determination adverse to the
interests of the Guarantor, could reasonably be expected to have a
Material Adverse Effect or which relates to this Guarantee or the
transactions contemplated hereby.
The Guarantor is not and will not be, after or as a result of
making this Guarantee, in default under or in violation of any Order of
any court, arbitrator or Governmental Authority or of any statute or
law or of any rule or regulation of any Governmental Authority, which
default or violation has or might have a Material Adverse Effect; and
the Guarantor is not subject to or a party to any Order of any court or
Governmental
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Authority arising out of any action, suit or proceeding under any
statute or other law respecting antitrust, monopoly, restraint of
trade, unfair competition or similar matters. As used herein, the term
"Order" includes any order, writ, injunction, decree, judgment, award,
determination or mandatory written direction or demand of any court,
arbitrator or Governmental Authority.
(f) Financial Condition. There has heretofore been delivered
to the Lenders a pro forma Consolidated income statement, and, after
giving effect to the acquisition of all of the Acquisition Systems and
the financing thereof, pro forma Consolidated balance sheet of the
Guarantor, in each case, dated as of the Closing Date, certified by a
Responsible Person. All material assumptions with respect to such pro
forma Consolidated balance sheet are set forth therein. Such pro forma
Consolidated balance sheet was prepared in good faith and in accordance
with Regulations S-X.
(g) Taxes. The Guarantor has paid, or has made adequate
provision for the payment of, all taxes shown to be due and payable on
any assessment made against the Guarantor or any of its property and
all other taxes, assessments, fees, liabilities or other charges
imposed on the Guarantor or any of its property by any Governmental
Authority, except for any taxes, assessments, fees, liabilities or
other charges which are being contested in good faith and for which
reserves which are adequate under GAAP have been established.
(h) Disclosure. None of the information relating to the
Guarantor delivered in writing to the Agent or any Lender in connection
with the negotiation, execution and delivery of this Guarantee contains
any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements made therein, in the
light of the circumstances under which they were made, not misleading,
except that with respect to the projections contained in such
information, the Guarantor hereby represents and warrants that such
projections were prepared on a reasonable basis and in good faith by
the Guarantor.
(i) Compliance with ERISA. (i) The Guarantor has
not engaged in a transaction with respect to any Plan
which could reasonably be expected to subject the
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Guarantor to a tax or penalty imposed by either Section 4975 of the
Code or Section 502(i) of ERISA in an amount that could have a Material
Adverse Effect.
(ii) No Plan had an accumulated funding
deficiency, whether or not waived, as of the last day of the
most recent plan year of such Plan.
(iii) No liability under Sections 4062, 4063
or 4064 of ERISA has been or is expected by the Guarantor to
be incurred by it with respect to any Plan which is a single
employer plan in an amount that would have a Material Adverse
Effect. The Guarantor has not incurred nor expects to incur
any withdrawal liability with respect to any Plan which is a
multiemployer plan in an amount which could have a Material
Adverse Effect.
(iv) Insofar as the representations and
warranties of the Guarantor contained in subsection (i) and
(ii) relate to any Plan which is a multiemployer plan, such
representations and warranties are made to the best knowledge
of the Guarantor. As used in this Section, (A) "accumulated
funding deficiency" shall have the meaning assigned to such
term in Section 412 of the Code and Section 302 of ERISA; (B)
"multiemployer plan" and "plan year" shall have the respective
meanings assigned to such terms in Section 3 or ERISA; (C)
"single employer plan" shall have the meaning assigned to such
term in Section 4001 of ERISA; (D) "withdrawal liability"
shall have the meaning assigned to such term in Part I of
Subtitle E of Title IV of ERISA.
(j) Conduct of Business. The Guarantor holds all
authorizations, consents, approvals, registrations, franchises,
licenses and permits, with or from Governmental Authorities and other
Persons as are required or necessary for it to own its properties and
conduct its businesses as now conducted and as currently proposed to be
conducted, except for those which the failure to so hold, in any one
case or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
(k) Compliance with Laws and Organizational Documents. The
Guarantor is not in violation of (i)
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any law, statute, rule, regulation, or order of any Governmental
Authority (including, without limitation, Environmental Laws)
applicable to any of them or any of its properties or assets except for
such violations which, individually and in the aggregate, could not
reasonably be expected to have a Material Adverse Effect or (ii) its
partnership agreement.
(l) Government Regulation. The Guarantor is not and will not
be, after giving effect to the transactions contemplated by this
Guarantee, (i) an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act
of 1940, as amended, or (ii) subject to regulation under the Public
Utility Holding Company Act of 1935 or the Federal Power Act or (iii)
subject to any foreign, federal, state or local statute or regulation
limiting its ability to incur indebtedness for Borrowed Money, pledge
assets as collateral for such indebtedness or guarantee such
indebtedness, as contemplated by this Guarantee or the Hypothecation
Agreements.
(m) Environmental Protection. To the Guarantor's knowledge,
all real property owned or leased by the Guarantor is free of
contamination from any substance that could result in the incurrence of
material liabilities, or constituent thereof, currently identified or
listed as hazardous or toxic pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. 9601,
et seq., or any other Environmental Laws, or any other substance which
has in the past or could at any time in the future cause or constitute
a health, safety or environmental hazard to any person or property,
including asbestos in any building, petroleum products, PCBs,
pesticides, or radioactive materials. To the Guarantor's knowledge,
based on reasonable investigation, the Guarantor has not caused or
suffered to occur any release of any Contaminant into the environment
or any other conditions that could result in the incurrence of material
liabilities nor any material violations of any Environmental Laws. To
the Guarantor's knowledge, based on reasonable investigation, the
Guarantor has not caused or suffered to occur any condition on any of
the Guarantor's property that could give rise to the imposition of any
lien under the Environmental Laws. To the Guarantor's knowledge, based
on reasonable investigation, the Guarantor is not engaged in any
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manufacturing or any other operations, other than the use of petroleum
products for vehicles, that require the use, handling, transportation,
storage or disposal of any Contaminant, where such operations require
permits or are otherwise regulated pursuant to the Environmental Laws.
(n) Insurance. All of the properties and operations of the
Guarantor of a character usually insured by companies of established
reputation engaged in the same or a similar business similarly situated
are insured in customary amounts, by financially sound and reputable
insurers, against loss or damage of the kinds and in amounts
customarily insured against by such Persons, and the Guarantor carries,
with such insurers in customary amounts, such other insurance,
including larceny, embezzlement or other criminal misappropriation
insurance and business interruption insurance, as is usually carried by
companies of established reputation engaged in the same or a similar
business similarly situated.
(o) Material Contracts. The Guarantor is neither a party to,
nor is it or any of its properties subject to or bound by, any
agreement or instrument (other than this Guarantee and the
Hypothecation Agreement) which (i) materially restricts its ability to
conduct its business or (ii) could reasonably be expected to have a
Material Adverse Effect.
(p) Performance of Agreements. The Guarantor is not in default
in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any contractual
obligation of the Guarantor, including, without limitation, its
Hypothecation Agreement, and no condition exists which, with the giving
of notice or the lapse of time or both, would constitute such a
default, except where the consequences, direct or indirect, of such
default or defaults, if any, could not reasonably be expected to have a
Material Adverse Effect.
4. Affirmative Covenants. Until full and final
payment of all Obligations, the Guarantor will:
(a) Financial Statements. Furnish to the Agent with sufficient
copies for each Lender (i) as soon as available, but in no event later than
August 15, 1996, unaudited consolidated financial statements of the Borrower
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as of June 30, 1996 certified by a Responsible Person and accompanied by a
certificate of said Responsible Person stating whether any event has occurred
which constitutes a Default or Event of Default and, if so, stating the facts
with respect thereto; (ii) upon request, copies of any reports and management
letters submitted to the Guarantors by accountants in connection with any annual
or interim audit of the books of the Guarantor, together with the Guarantor's
responses thereto, if any; (iii) as soon as available, copies of all financial
statements, reports and other notices sent by the Guarantor to its partners; and
(iv) such additional information, reports or statements as the Agent may from
time to time reasonably request. Upon receipt of any such financial statements
or additional information, the Agent shall forthwith forward copies thereof to
each Lender.
(b) Taxes. Pay and discharge all taxes, assessments and
governmental charges upon it, its income and its properties prior to the date on
which penalties are attached thereto, unless and to the extent only that (i)
such taxes, assessments and governmental charges shall be contested in good
faith and by appropriate proceedings by the Guarantor, (ii) reserves which are
adequate under GAAP are maintained by the Guarantor with respect thereto, and
(iii) any failure to pay and discharge such taxes, assessments and governmental
charges will not have a Material Adverse Effect.
(c) Insurance. Maintain insurance with responsible insurance
companies against such risks, on such properties and in such amounts as is
customarily maintained by similar businesses.
(d) Existence. (i) Maintain its partnership existence in good
standing and (ii) qualify and remain qualified to do business as a foreign
partnership in each jurisdiction in which the character of the properties owned
or leased by it therein or in which the transaction of its business is such that
the failure to qualify would have a Material Adverse Effect. The Guarantor will
maintain the same fiscal year during the term of this Agreement.
(e) Maintenance of Records. (i) Keep proper books of record
and account in which full, true and correct entries will be made of all dealings
or transactions of or in relation to its business and affairs. All
determinations pursuant to this subsection shall be made in accordance with, or
as required by, GAAP consistently applied in the
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opinion of such independent public accountants as shall then be regularly
engaged by the Guarantor.
(f) Inspection. Permit the Agent and the Lenders to have one
or more of their officers and employees, or any other Person designated by the
Agent or the Lenders, upon prior reasonable notice visit and inspect any of the
properties of the Guarantor and to examine the minute books, books of account
and other records of the Guarantor and make copies thereof or extracts
therefrom, and discuss its affairs, finances and accounts with its officers and,
at the request of the Lenders, with the Guarantor's independent accountants,
during normal business hours and at such other reasonable times and as often as
the Lenders may reasonably desire.
(g) Maintenance of Property, etc. Subject to Section 5(c), (i)
except for ordinary wear and tear, maintain, keep and preserve all of its
properties in good repair, working order and condition and from time to time
make all necessary and proper repairs, renewals, replacements, and improvements
thereto, and (ii) maintain, preserve and protect all Franchises, licenses,
copyrights, patents and trademarks material to its business (except where the
failure so to do, in any one case or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect) so that the business carried on in
connection therewith may be properly conducted at all times.
(h) Conduct of Business. (i) Engage in as its principal
business the direct or indirect ownership or operation of cable television
systems, (ii) preserve, renew and keep in full force and effect all its material
contracts, (iii) preserve, renew and maintain in full force and effect all its
Franchises and licenses necessary or desirable in the normal conduct of its
business as now conducted, and (iv) comply with the rules and regulations of all
Governmental Authorities, including without limitation all rules and regulations
promulgated by the Federal Communications Commission or any successor
Governmental Authority thereto, except where the failure to comply with clauses
(i) through (iv), in any one case or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
(i) Notification of Events of Default and Adverse
Developments. Promptly notify the Agent upon the discovery by any Responsible
Person or officer of the Guarantor of the occurrence of (i) any Default or Event
of Default hereunder;
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(ii) any event, development or circumstance whereby the financial statements
most recently furnished to the Agent fail in any material respect to present
fairly, in accordance with GAAP, the financial condition and operating results
of the Guarantor as of the date of such financial statements; (iii) any
litigation or proceedings that are instituted or threatened (to the knowledge of
the Guarantor) against the Guarantor or any of its assets which, if there is a
reasonable possibility of a determination adverse to the interests of the
Borrower, could reasonably be expected to have a Material Adverse Effect; (iv)
each and every event which would be an event of default (or an event which with
the giving of notice or lapse of time or both would be an event of default)
under any indebtedness of the Guarantor for Borrowed Money, such notice to
include the names and addresses of the holders of such indebtedness and the
amount thereof; (v) the repeal or revocation of any Pole Attachment Agreement,
authorization, consent, exemption or license with, to or from Governmental
Authorities and other Persons which are necessary in connection with the
operation of the Acquisition Systems, except to the extent that the repeal or
revocation thereof, individually or in the aggregate, would not have a Material
Adverse Effect; (vi) the repeal or revocation of any Franchise which is
necessary in connection with the operation of an Acquisition System; and (vii)
any other development in the business or affairs of the Guarantor if the effect
thereof could reasonably be expected to have a Material Adverse Effect; in each
case describing the nature thereof and the action the Guarantor proposes to take
with respect thereto. Upon receipt of any such notice of default or adverse
development, the Agent shall forthwith give notice to each Lender of the details
thereof.
(j) ERISA. Furnish to the Lenders:
(i) within ten days after a Responsible Officer knows
that any "reportable event" (as defined in Section 4043(b) of ERISA),
other than a reportable event for which the 30-day notice requirement
has been waived by the PBGC, has occurred with respect to a Pension
Plan, a statement setting forth details as to such reportable event and
the action proposed to be taken with respect thereto;
(ii) within ten days after receipt thereof, a copy of
any notice that the Guarantor or any member of the ERISA Group may
receive from the PBGC relating to the intention of the PBGC to
terminate any Pension Plan or to appoint a trustee to administer any
Plan;
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(iii) within ten days after filing with any affected
party (as such term is defined in Section 4001 of ERISA) of a notice of
intent to terminate a Pension Plan, a copy of such notice and a
statement setting forth the details of such termination, including the
amount of liability, if any, of the Guarantor or any member of the
ERISA Group under Title IV of ERISA;
(iv) within ten days after the adoption of an
amendment to a Pension Plan if, after giving effect to such amendment,
the Pension Plan is a plan described in Section 4021(b) of ERISA, a
statement setting forth the details thereof;
(v) within 30 days after withdrawal from a Pension
Plan during a plan year for which the Guarantor or any member of the
ERISA Group could be subject to liability under Section 4063 or 4064 of
ERISA, a statement setting forth the details thereof, including the
amount of such liability;
(vi) within 30 days after cessation of operations by
the Guarantor or any member of the ERISA Group at a facility under the
circumstances described in Section 4062(e) of ERISA, a statement
setting forth the details thereof, including the amount of liability of
the Guarantor or a member of the ERISA Group under Title IV of ERISA;
(vii) within ten days after adoption of an amendment
to a Pension Plan which would require security to be given to the
Pension Plan pursuant to Section 401(a)(29) of the Code or Section 307
of ERISA, a statement setting forth the details thereof, including the
amount of such security;
(viii) within ten days after failure by the Guarantor
or any member of the ERISA Group to make payment to a Pension Plan
which would give rise to a lien in favor of the Plan under Section
302(f) of ERISA, a statement setting forth the details thereof,
including the amount of such lien;
(ix) within ten days after the due date for filing
with the PBGC, pursuant to Section 412(n) of the Code, of a notice of
failure to make a required installment or other payment with respect to
a Pension Plan, a statement setting forth details as to such
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failure and the action proposed to be taken with respect thereto; and
(x) within 30 days after receipt thereof by the
Guarantor or any member of the ERISA Group from the sponsor of a
Multiemployer Plan, a copy of each notice concerning the imposition of
withdrawal liability or the termination or reorganization of a
Multiemployer Plan.
(k) Environmental Matters. (i) Comply in all material respects
with all applicable Environmental Laws, (ii) notify the Agent promptly after
becoming aware of any adverse environmental condition or Environmental Claim in
connection with the Guarantor's properties or facilities, and (iii) promptly
forward to the Agent a copy of any order, notice, permit, application, or any
other communication or report received by the Guarantor in connection with any
such matters as they may affect such premises, if material.
5. Negative Covenants. Until full and final
payment of all Obligations, the Guarantor will not:
(a) Borrowing. Create, incur, assume or suffer to exist any
liability or obligation for Borrowed Money, except this Guarantee. Liabilities
or obligations for Borrowed Money incurred by the Guarantor as permitted by and
in accordance with the Credit Agreement shall not constitute a liability or
obligation for Borrowed Money for purposes of this Section 5(a).
(b) Mortgages and Pledges. Create, incur, assume or suffer to
exist any Lien upon or in any of its property or assets, whether now owned or
hereafter acquired, except Permitted Encumbrances; or enter into or suffer to
exist any agreement or other instrument binding on the Guarantor or affecting
any of its properties which prohibits, requires the consent of any Person for or
otherwise restricts the creation of any Lien in favor of the Lenders. For
purposes of this Guarantee, the term "Permitted Encumbrances" shall include the
encumbrances specified in clauses (i) to (viii) of the definition thereof
contained in the Credit Agreement and shall also include the Liens granted in
the Hypothecation Agreements.
(c) Merger, Acquisition or Sales. Enter into any merger or
consolidation or purchase, lease or otherwise acquire assets of any Person or
sell, lease, or otherwise dispose of any of its assets, except the Guarantor may
enter
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into agreements to acquire one or more cable television systems provided that no
such agreement shall permit or require any such acquisition to be consummated on
or prior to the Termination Date [and except that the Guarantor may enter into
any Acquisition Systems Agreements and may consummate the transactions
contemplated thereby subject to the applicable provisions of the Credit
Agreement].
(d) Contingent Liabilities. Assume, guarantee, endorse,
contingently agree to purchase or otherwise become liable upon the obligation of
any Person (all such transactions herein being referred to as "Contingent
Liabilities"), except (i) the obligations guaranteed by this Guarantee, (ii) by
the endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business, (iii) with respect to the
Acquisition Systems, obligations undertaken or incurred in the ordinary course
of the Borrower's business (other than in connection with the borrowing of money
or obtaining of credit) as presently conducted for or on behalf of the Borrower
and (iv) obligations of the Borrower arising in connection with the Acquisition
Systems Agreements.
(e) Loans and Investments. Purchase or acquire the
obligations, stock or partnership interest of, or any other interest in, or make
loans or advances to, any Person, except (i) direct obligations of the United
States of America with a maturity not exceeding one year, (ii) certificates of
deposit with a maturity not exceeding one year issued by a Lender or a
commercial bank, chartered under the laws of the United States or one of the
States thereof and a member of the Federal Reserve System with a long-term debt
rating in one of the two highest categories then provided for by a nationally
recognized rating agency, (iii) commercial paper with a remaining maturity of
270 days or less with a debt rating in the highest category then provided for by
a nationally recognized rating agency and issued by a corporation organized
under the laws of any State, (iv) investments in mutual funds that invest in any
of the foregoing investments described in clauses (i)-(iii) above, (v)
Intercompany Loans and (vi) other loans to and investments in Persons that are
engaged primarily in the cable television business, including pay cable service,
or in the business of acquiring, owning, expanding, operating and maintaining
cable television systems, or in directly related media activities including,
without limitations, data transmission services, telephony and the production of
programming; provided that the restrictions in Section
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8.02(g)(vi)(x), (y) and (z) of the Loan Agreement shall apply hereto.
(f) Restricted Payments. Make any Restricted Payment. For the
purpose of this Guarantee, the term "Restricted Payment" shall mean (i) the
declaration or payment of any dividends or distributions on any partnership or
other ownership interest in the Guarantor, application of any property or assets
of the Guarantor to the purchase or acquisition, redemption or other retirement
of, or setting apart of any sum for the payment of any distributions on, or for
the purchase, redemption or other retirement of, or the making of any other
distribution by reduction of partnership interests or otherwise in respect of
any partnership interest in the Guarantor, (ii) application of any property or
assets of the Guarantor to the prepayment of principal, and premium, if any,
purchase or other acquisition, redemption or other retirement of indebtedness
for Borrowed Money, or the setting aside of any sum therefor, (iii) other than
equity contributions to the Borrower in accordance herewith, any advance, equity
contribution or other payment to any Affiliate of the Guarantor, and (iv) any
other payment or advance to any other Person, other than payments to trade
creditors or to other Persons for services rendered in the ordinary course of
business or other payments in the ordinary course of business.
(g) Purchase of Equity Interests. Apply any of its property or
assets to the purchase, redemption or other retirement of, or set apart any sum
for the purchase, redemption or other retirement of, or make any other
distribution by reduction of capital or otherwise in respect of, any partnership
interests in the Guarantor.
(h) Subsidiaries. Own any Subsidiary or any general
partnership interest in any general or limited partnership, except as permitted
by and in accordance with the Credit Agreement.
(i) Transactions with Affiliates. Other than the transactions
contemplated by this Guarantee and the Hypothecation Agreements, enter into or
permit to exist any transaction (including, without limitation, the purchase,
sale, lease or exchange of any property or the rendering of any service) with
any Affiliate of the Guarantor on terms that are less favorable to the Guarantor
than those that would be obtainable at the time in an arm's-length transaction
with any Person who is not such an Affiliate, provided that this subsection (i)
shall not be deemed to
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prohibit any transaction or payment provided for in any Related Document, so
long as at the time of such payment or transaction and after giving effect
thereto no Default or Event of Default shall have occurred and be continuing.
6. Reserved.
7. Events of Default. Any Event of Default (as such term is
defined in the Credit Agreement) shall constitute an "Event of Default"
hereunder.
8. Expenses. The Guarantor agrees to pay on demand all
reasonable out-of-pocket expenses (including the reasonable fees and expenses of
counsel) in any way relating to the enforcement or protection of the rights of
the Creditors hereunder.
9. Subrogation. Until all Obligations shall have been
satisfied, the Guarantor shall not have any right of subrogation, and waives any
right to enforce any remedy which any Creditor now has or may hereafter have
against the Borrower or any other guarantor, and waives any and all statutory or
other rights to participate in any security now or hereafter held by any
Creditor.
10. Continuing Guarantee. This is a continuing Guarantee and
shall remain in full force and effect and be binding upon the Guarantor, its
successors and assigns until full and final payment of all Obligations.
11. No Waiver; Cumulative Rights. No failure on the part of
any Creditor to exercise, and no delay in exercising, any right, remedy or power
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise by the Creditors of any right, remedy or power hereunder preclude any
other or future exercise of any other right, remedy or power. Each and every
right, remedy and power hereby granted to the Creditors or allowed them by law
or other agreement shall be cumulative and not exclusive the one of any other,
and may be exercised by the Creditors from time to time.
12. Waiver of Notice. The Guarantor waives notice of the
acceptance of this Guarantee and of the making of any Loans or other extensions
of credit to the Borrower, presentment to or demand or payment from anyone
whomsoever liable upon any of the Obligations, presentment, demand, notice of
dishonor, protest, notice of any sale of collateral security and all other
notices whatsoever.
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13. GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
14. Consent to Jurisdiction. The Guarantor hereby irrevocably
submits to the non-exclusive jurisdiction of any State or federal court in The
City of New York located in the Borough of Manhattan for the purpose of any
suit, action, proceeding or judgment arising out of or relating to this
Guarantee. The Guarantor hereby appoints CT Corporation System, with offices on
the date hereof at 1633 Broadway, New York, New York 10019, as its authorized
agent on whom process may be served in any action which may be instituted
against it by the Creditors in any state or federal court in New York City,
arising out of or relating to this Guarantee. Service of process upon such
authorized agent and written notice of such service to the Guarantor shall be
deemed in every respect effective service of process upon the Guarantor, and the
Guarantor hereby irrevocably consents to the jurisdiction of any such court in
any such action and to the laying of venue in New York City. The Guarantor
hereby irrevocably waives any objection to the laying of the venue of any such
suit, action or proceeding brought in the aforesaid courts and hereby
irrevocably waives any claim that any such suit, action or proceeding brought in
any such court has been brought in an inconvenient forum. Notwithstanding the
foregoing, nothing herein shall in any way affect the right of the Creditors to
bring any action arising out of or relating to this Guarantee in any competent
court elsewhere having jurisdiction over the Guarantor or its property.
15. WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS GUARANTEE.
16. Limited Recourse. No Creditor shall have recourse to any
partner of the Guarantor (or any partner of such partner) for the payment of the
Obligations, except as provided in the Hypothecation Agreements.
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IN WITNESS WHEREOF, this Guarantee has been duly executed and
delivered by the Guarantor to the Creditors as of the date first above written.
INTERMEDIA PARTNERS OF WEST TENNESSEE, L.P.
By: InterMedia Partners IV, L.P.
By: InterMedia Capital Management IV, L.P.
By: InterMedia Management, Inc.
By: /s/ Leo J. Hindery, Jr.
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Name:
Title:
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