Document:

Exhibit 10.1

 

PROMISSORY NOTE

 

	
  Principal Amount: $70,414,087.87

  	
   

  	
  Date:

  	
  As of March 21, 2006

  
	
   

  	
   

  	
   

  	
  Wilmington, Delaware

  

 

§1.          Promise to Pay.

 

For value received, the Company hereby promises to pay to the order of
Hallmark Entertainment Holdings, Inc. or its assigns, (“Holdings”) at such
place as Holdings may, from time to time specify in writing, the above
principal amount outstanding under this Note together with all fees and accrued
interest no later than the Maturity Date and in accordance with Section 2 hereof.

 

§2.          Interest.

 

§2.1        Loans provided hereunder shall bear
interest at the rate of LIBOR plus 300 basis points per annum from the effective
date of March 21, 2006 and shall be payable in full on May 31, 2007 (“Maturity
Date”).

 

§2.2        All calculations of interest and fees
shall be made on the basis of actual number of days elapsed in a 360-day year
and accrued but unpaid interest shall be added to the principal amount annually.)

 

§2.3        “LIBOR” shall mean the three month rate
for London Inter-Bank Offering Rate published for the first day of each quarter
in the Wall Street Journal.

 

§3.          Repayment and Optional Prepayment.

 

§3.1        The Company shall pay to Holdings a
single principal payment together with all accrued and unpaid interest on the
Maturity Date.

 

§3.2        The Company shall have the privilege at
any time and from time to time, to prepay this Note in whole or in part without
premium or penalty to the extent permitted by that certain Credit and Security
Agreement dated as of August 31, 2001 with JPMorgan Chase as agent (“Credit
Agreement”).

 

§4.          Events of Default.

 

Each of the following shall constitute an event of default hereunder
(an “Event of Default”):

 

(i)            The failure of the
Company to make any payment of principal or interest hereunder when the same is
due and payable, and such failure to pay continues for a period of five (5)
days or more after written notice thereof from Holdings;

 

(ii)           The Company shall
be in default with respect to the Credit Agreement or with respect to that
certain Note Purchase Agreement dated as of August 1, 2003 by and between Crown
Media Holdings, Inc. and HC Crown Corp and such default under either facility
could accelerate the maturity of the indebtedness thereunder and such default
is not cured or waived within the grace period provided therein.

 

1

 

5.             Remedies.

 

Upon the
occurrence of an Event of Default and at any time thereafter during the
continuance of such Event of Default hereunder, Holdings shall have the right
to declare the entire unpaid amount of principal and interest hereunder
immediately due and payable in full without presentation, demand or protest,
each of which is hereby waived by the Company.

 

§6           Waivers.

 

§6.1        The
failure by Holdings to exercise any right or remedy available hereunder in the
Event of Default shall in no event be construed as a waiver or release of the
same. Likewise, Holdings shall not, by any act or omission or commission, be
deemed to waive any right hereunder unless such waiver is evidenced in writing
and signed by Holdings, and then only to the extent specifically set forth in
such writing. Moreover, a waiver with respect to any one event shall not be
construed as continuing or as a bar to or waiver of Holdings’ rights or
remedies with respect to any subsequent event.

 

§6.2        The
Company expressly waives presentment for payment, notice of dishonor, protest,
notice of protest, diligence of collection, and each other notice of any kind,
and hereby consent to any number of renewals or extensions of time for payment
hereof, which renewals and extensions shall not affect the liability of the
Company.

 

§6.3        The Company hereby waives and releases
all errors, defects and imperfections in any proceeding instituted by Holdings
under the terms hereof as well as all benefits that might accrue to the Company
by virtue of any present or future laws exempting any property, real, personal
or mixed, or any part of the proceeds arising from any sale of such property,
from attachment, levy or sale under execution, or providing for any stay of
execution, exemption from civil process, or extension of time for payment; and
the Company agrees that any real estate that may be levied upon pursuant to a
judgment obtained by virtue hereof, or any writ of execution issued thereon,
may be sold upon any such writ in whole or in part or in any other manner
desired by Holdings.

 

§7.          Notices.

 

Each notice
required to be given to any party hereunder shall be in writing and shall be
deemed to have been sufficiently given for all purposes when sent by certified
or registered mail, return receipt requested, to the party at its respective
address as follows or to such other address as indicated by such party in
writing:

 

	
  Company:

  	
  Crown Media Holdings, Inc.

  
	
   

  	
  12700
  Ventura Blvd, Suite 200

  
	
   

  	
  Studio City,
  CA 91604

  
	
   

  	
  Phone:
  818-755-2400

  
	
   

  	
  ATTN:
  Executive VP, Legal Affairs

  
	
   

  	
   

  
	
  Holdings:

  	
  Hallmark Entertainment Holdings, Inc.

  
	
   

  	
  2501 McGee,
  MD #342

  
	
   

  	
  Kansas City,
  MO 64108

  
	
   

  	
  ATTN: Chief
  Financial Officer

  

 

2

 

	
  With a copy to:

  	
  Hallmark Cards, Incorporated

  
	
   

  	
  P.O. Box 419126

  
	
   

  	
  Kansas City, MO 64141

  
	
   

  	
  ATTN: General Counsel

  

 

§8.          Assignability.

 

This Agreement
shall be binding upon and inure to the benefit of the Company and Holdings and
their respective successors and assigns; provided, however, that this Note, or
any portion thereof, may not be assigned by the Company without the written
consent of Holdings.

 

§9.          Modifications.

 

This Note may
be modified only in a writing signed by the Company and Holdings. Any amendment,
extension of time or any other modification shall not affect Company’s
obligations hereunder. 

 

§10.        Governing Law.

 

This Note
shall be governed by and construed according to the laws of the State of
Delaware without regard to the conflict of laws provisions thereof.

 

§11.        Headings.

 

The heading
preceding the text of each Section hereof is inserted solely for convenience of
reference and shall not constitute a part of this Note, nor shall the same
affect the meaning, construction of effect hereof.

 

§12.        Severability.

 

If any
provision of this Note or the application thereof is declared by a court of
competent jurisdiction to be invalid or unenforceable, the remaining provisions
hereof shall be unaffected and remain valid and enforceable to the fullest
extent permitted by law.

 

IN WITNESS WHEREOF, the undersigned officers
have executed this Note as of the day and year first above written thereby
legally binding such party to the terms hereof.

 

 

	
   

  	
  CROWN MEDIA HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ William J. Aliber

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  William J. Aliber

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  EVP / CFO

  	
   

  

 

3EXHIBIT 10.2

 

TRADEMARK LICENSE EXTENSION AGREEMENT

 

This
Extension Agreement dated as of April 10, 2006 is by and between Hallmark
Licensing, Inc. (“Hallmark Licensing”) and Crown Media United States, LLC
(“Crown US”).

 

WHEREAS,
Crown US and Hallmark Licensing have previously entered into that certain Movie
Channel Trademark License Agreement between the parties dated as of January 1,
2004, as extended as of August 1, 2004, and as of August 1, 2005 (the
“License Agreement”); and

 

WHEREAS,
the parties desire to further extend the term of the License Agreement;

 

NOW,
THEREFORE, Crown US and Hallmark Licensing hereby agree as follows:

 

The term of the License Agreement shall be extended
for an additional period terminating on September 1, 2007, subject to any earlier
termination pursuant to the terms of the License Agreement.

 

All other terms and conditions of the License
Agreement will remain unchanged and in full force and effect.

 

IN
WITNESS WHEREOF, the parties hereto have executed this Extension Agreement as
of the date set forth above.

 

 

	
  HALLMARK
  LICENSING, INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Deanne
  Stedem

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  /s/ Vice
  President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  CROWN MEDIA
  UNITED STATES, LLC

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Charles
  Stanford

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  /s/ Vice
  PresidentEXHIBIT 10.3

 

TRADEMARK
LICENSE EXTENSION AGREEMENT

 

This Extension Agreement
dated as of April 10, 2006 is by and between Hallmark Licensing, Inc. (“Hallmark
Licensing”) and Crown Media United States, LLC (“Crown US”).

 

WHEREAS, Crown US and
Hallmark Licensing have previously entered into that certain Amended and
Restated Trademark License Agreement between the parties dated as of March 17,
2001 as extended on November 30, 2002, as of August 28, 2003, as of August 1,
2004, and as of August 1, 2005 (the “License Agreement”); and

 

WHEREAS, the parties
desire to further extend the term of the License Agreement;

 

NOW, THEREFORE, Crown US
and Hallmark Licensing hereby agree as follows:

 

The
term of the License Agreement shall be extended for an additional period
terminating on September 1, 2007, subject to any earlier termination pursuant
to the terms of the License Agreement.

 

All
other terms and conditions of the License Agreement will remain unchanged and
in full force and effect.

 

IN WITNESS WHEREOF, the
parties hereto have executed this Extension Agreement as of the date set forth
above.

 

 

	
  HALLMARK LICENSING,
  INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Deanne Stedem

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  /s/ Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  CROWN MEDIA UNITED
  STATES, LLC

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Charles Stanford

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  /s/ Vice President

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