Document:

Exhibit 10.16

 

EXECUTION VERSION

 

AMENDED AND RESTATED

PROMISSORY NOTE

 

$5,513,078.99

 

Original Issue Date:  December 31, 2012

As amended and restated as of March 15, 2013

New York, New York

 

WHEREAS, Nightlife Holdings LLC, a Florida limited liability company (hereinafter referred to as “Nightlife”), is the holder of that certain Secured Promissory Note issued and delivered by SFX Holding Corporation (n/k/a SFX Entertainment, Inc.), a Delaware corporation (hereinafter referred to as “Parent”) on December 31, 2012 (the “Original Note”); and

 

WHEREAS, Nightlife and Parent desire to amend and restate the Original Note in its entirety in the manner hereinafter set forth, and to replace the Original Note with this Amended and Restated Promissory Note (this “Note”).

 

NOW THEREFORE, by Parent’s execution and delivery of this Note and Nightlife’s acceptance of such delivery from Parent, this Note is deemed to replace the Original Note, and the Original Note is restated in its entirety to read as follows:

 

FOR VALUE RECEIVED, Parent hereby promises to pay to the order of Nightlife, the principal sum of FIVE MILLION FIVE HUNDRED THIRTEEN THOUSAND SEVENTY EIGHT DOLLARS AND NINETY NINE CENTS ($5,513,078.99).

 

Terms of Payment:  Principal and accrued interest under this Note shall be due and payable in full on or before May 15, 2013 (the “Maturity Date”).  Principal and/or accrued interest under this Note may be prepaid in whole or in part, without premium or penalty, by Parent to Nightlife prior to the Maturity Date.

 

Interest Rate:  The interest rate applicable to the amounts payable by Parent to Nightlife under this Note shall be 0.22% per annum.  All calculations of interest hereunder shall be made on the basis of a 360-day year.

 

Default:  Upon the failure of Parent to pay any amount owing under this Note as and when due, Nightlife may, in addition to any other rights or remedies that Nightlife may have at law or in equity, declare the unpaid balance hereof to be immediately due and payable, whereupon such unpaid balance shall become immediately due and payable.  Upon the filing of an involuntary petition against Parent under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction, whether now or hereafter in effect, or upon the making by Parent of an assignment for the benefit of creditors or the filing by Parent of a voluntary petition seeking relief under any provision of any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction, whether now or hereafter in effect, the unpaid balance hereof automatically and without any action on the part of Nightlife, shall be immediately due and payable.  Amounts declared immediately due and payable pursuant to this paragraph shall bear interest thereafter at an amount equal to the applicable interest rate above, plus five percent (5.00%)  until paid.

 

 

Waiver:  Demand, presentment, notice, notice of demand, notice for payment, protest and notice of dishonor are hereby waived by Parent.  Nightlife shall not be deemed to waive any of its rights hereunder unless such waiver be in writing and signed by Nightlife.  Any failure on the part of Nightlife at any time to require the performance by Parent of any of the terms or provisions hereof, even if known, shall in no way affect the right thereafter to enforce the same, nor shall any failure of Nightlife to insist on strict compliance with the terms and conditions hereof be taken or held to be a waiver of any succeeding breach or of the right of Nightlife to insist on the strict compliance with the terms and conditions hereof.

 

Confession of Judgment:  This Note is the “Amended Note” referred to in that certain Affidavit of Confession of Judgment (“Confession of Judgment”) of even date herewith executed by a duly authorized officer of Parent, and Nightlife is entitled to all of the rights and benefits contained therein.

 

Costs of Collection:  In the event that Nightlife seeks to enforce the Confession of Judgment and/or institutes legal proceedings to enforce this Note or refers the same to an attorney-at-law for enforcement or collection after default or maturity, Parent agrees to pay to Nightlife, in addition to any indebtedness due and unpaid, all reasonable costs and expenses of such proceedings, including reasonable attorneys’ fees.

 

Remedies Cumulative:  All remedies conferred upon Nightlife by this Note or any other instrument or agreement connected herewith or related hereto shall be cumulative and none is exclusive, and such remedies may be exercised concurrently or consecutively at Nightlife’s option.

 

Terms:  The term “Parent” as used herein shall include the successors and assigns of the Parent.  The term “Nightlife” as used herein shall include the successors and assigns of Nightlife.

 

Assignment:  Neither party may assign, transfer or convey its interest under this Note without the express written consent of the other party.

 

Severability:  If any provision of this Note is, for any reason and to any extent, invalid or unenforceable, then the remaining provisions of this Note, and the application of the provision determined to be unenforceable to other circumstances, shall not, at the election of the party for whom the benefit of the unenforceable provision exists, be affected thereby, but instead shall be enforceable to the maximum extent permitted by applicable law.

 

Amendment:  This Note may be amended only in a writing signed by both Parent and Nightlife.

 

Miscellaneous:  This Note shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to principles of conflict of laws that would cause the laws of another state to apply.  Parent acknowledges and agrees that any action, suit or proceeding to enforce any provision of, or based on any matter arising out of or in connection with this Note shall be brought in any federal or state court located in the State of New York, and Parent hereby consents to the jurisdiction of such courts in any such action, suit or proceeding and irrevocably waives, to the fullest extent possible under applicable law, any objection that it may now or hereafter have to the laying of venue in any such court that such action, suit or proceeding has been brought in an inconvenient forum.  Process in any such suit, action or proceeding may be served on any party anywhere in the world.  TIME IS OF THE ESSENCE OF THIS NOTE.

 

*              *              *              *

 

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IN WITNESS WHEREOF, Parent has signed, sealed and delivered this Note on the date first hereinabove written.

 

 

	
 
    	
 
    	
MAKER:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
SFX   ENTERTAINMENT, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Sheldon Finkel
    
	
 
    	
 
    	
Name:   Sheldon Finkel
    
	
 
    	
 
    	
Title:   President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Acknowledged   and Agreed:
    	
 
    	
 
    
	
NIGHTLIFE   HOLDINGS LLC
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By   David Grutman, Inc., Member-Manager
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/   David Grutman
    	
 
    	
 
    
	
Name:   David Grutman
    	
 
    	
 
    
	
Title:   President
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:   Sebu Corp., Member-Manager
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/   Brian Gordon
    	
 
    	
 
    
	
Name:   Brian Gordon
    	
 
    	
 
    
	
Title:   President
    	
 
    	
 
    

 

3Exhibit 10.17

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, ASSIGNED, OR OTHERWISE TRANSFERRED EXCEPT (I) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT THAT IS CURRENT WITH RESPECT TO THIS NOTE OR (II) PURSUANT TO A SPECIFIC EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, BUT ONLY UPON A HOLDER HEREOF FIRST HAVING OBTAINED THE WRITTEN OPINION OF COUNSEL, SATISFACTORY TO THE BORROWER AS TO BOTH OPINION AND COUNSEL, THAT ANY SUCH PROPOSED DISPOSITION IS IN COMPLIANCE WITH ALL APPLICABLE PROVISIONS OF THE SECURITIES ACT AS WELL AS ANY APPLICABLE STATE SECURITIES LAW.

 

	
$7,000,000
    	
Effective Date: December 31, 2012
    
	
New   York, New York
    	
Maturity Date: March 31, 2013
    

 

FOR VALUE RECEIVED, the undersigned, SFX HOLDING CORPORATION, a Delaware corporation (the “Borrower”), hereby promises to pay to the order of ROBERT F.X. SILLERMAN (the “Holder”) the principal sum of $7,000,000, plus interest, as more specifically described below.

 

1.             Issuance. This note (this “Note”) is being issued on December 31, 2012 (the “Effective Date”) contemporaneously with the issuance of other notes (each, an “Other Note”), each of which is being issued upon the same terms as this Note (except potentially as to the aggregate principal amount represented by such Other Note) and which Other Notes, collectively with this Note, have an aggregate unpaid principal balance (at a given time of determination, the “Aggregate Unpaid Principal”) as of the Effective Date of $7,000,000. Additionally, contemporaneously with the issuance of this Note to the Holder, the Borrower is issuing warrants to the Holder that entitle the Holder to purchase shares of the Borrower’s common stock, par value $0.001 per share (“Common Stock”), subject to the terms thereof.

 

2.             Interest.

 

(a)           Interest will accrue on the unpaid principal balance of this Note (at a given time of determination, “Unpaid Principal”) at a rate of 9% per annum. Interest will be calculated based on a 365-day year and charged for the actual number of days elapsed after the Effective Date through and including the last date on which Unpaid Principal was unpaid. Interest will be first payable on the Maturity Date (or, with respect to any Unpaid Principal that is prepaid before the Maturity Date, on the date of such prepayment) and, if any principal remains unpaid after the Maturity Date, will continue to accrue on such Unpaid Principal until such Unpaid Principal is paid.

 

 

(b)           With respect to each payment of interest, the Borrower shall pay such interest in one of the following manners (at the Borrower’s option): (i) by paying such interest entirely in cash; (ii) by issuing an amount of shares of Common Stock, at an assumed value per share equal to $5.00, equal to the amount of such interest; or (iii) through a combination of paying cash or issuing shares of Common Stock at an assumed value per share equal to $5.00. In order to evidence an issuance of shares of Common Stock in satisfaction of the payment of interest as contemplated by the immediately foregoing clause (ii) or (iii), the Borrower shall deliver to the Holder one or more share certificates evidencing the aggregate amount of such shares. By accepting delivery of this Note, (x) the Holder acknowledges that transfer of any such shares will be subject to the transfer restrictions set forth on the certificate evidencing such shares and (y) the Holder hereby agrees that the Holder shall sign and deliver to the Borrower an acknowledgment pursuant to which the Holder acknowledges that the Holder has received any such certificate or certificates and is aware of such transfer restrictions.

 

3.             Maturity Date; Payment. All Unpaid Principal, together with all accrued and unpaid interest, will be due and payable on the date (the “Maturity Date”) that is the earlier of the following: (a) March 31, 2013; or (b) such earlier date on which such amounts become due and payable because of acceleration in accordance with the terms hereof. On the Maturity Date, the Borrower shall pay the entire Unpaid Principal at such time together with all accrued and unpaid interest then owing.

 

4.             Prepayment.

 

(a)                                 Subject to Sections 4(b) and (c), the Borrower is permitted to prepay this Note, in whole or in part, (i) without penalty or premium and (ii) without prior notice to the Holder. Any payments made pursuant to this Note will be deemed to be applied first toward the payment of interest and then toward the payment of principal. The total amount outstanding (including accrued but unpaid interest) hereunder will be reduced accordingly by any such prepayment.

 

(b)                                 If after the Effective Date the Borrower issues any capital stock in exchange for cash consideration, then the Borrower shall, contemporaneously with or promptly after the closing of such issuance, prepay an amount of Unpaid Principal and interest hereunder equal to, in aggregate, the lesser of (i) the aggregate amount of all Unpaid Principal at the time of such prepayment plus the aggregate amount of all interest owing at the time of such prepayment and (ii) an amount equal to one-third of the gross cash consideration that the Borrower receives pursuant to such issuance multiplied by a fraction (x) the numerator of which is the amount of Unpaid Principal at the time of such prepayment and (y) the denominator of which is the Aggregate Unpaid Principal at such time.

 

(c)                                  If after the Effective Date the Borrower enters into any debt obligation for borrowed money whereby the Borrower receives $15,000,000 or more in loan proceeds, then the Borrower shall, contemporaneously with or promptly after the

 

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closing of such debt obligation, prepay all Unpaid Principal and interest hereunder.

 

5.             Bankruptcy Events and Remedies.

 

(a)           Each of the following events constitutes an event of default under this Note (each, an “Event of Default”):

 

(i)            the Borrower defaults in the payment of all or any part of the principal or interest due under or pursuant to this Note as and when it becomes due and payable;

 

(ii)           the Borrower, pursuant to or within the meaning of Title 11, U.S. Code or any similar federal or state law for the relief of debtors (collectively, “Bankruptcy Law”) (A) commences a voluntary case or proceeding, (B) consents to the entry of an order for relief against the Borrower in an involuntary case or proceeding, (C) consents to the appointment of a trustee of the Borrower or for all or substantially all of the Borrower’s property, (D) makes a general assignment for the benefit of the Borrower’s creditors or (E) is unable to pay the Borrower’s debts as they become due; and

 

(iii)          a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (A) is for relief against the Borrower, in an involuntary case, or (B) appoints a trustee of the Borrower for all or substantially all of the Borrower’s property, and, in any such case, such order or decree is not withdrawn, dismissed, or stayed for 60 days.

 

(b)           If an Event of Default specified in Sections 5(a)(ii) or (iii) occurs, then the principal and interest hereunder will thereby become and be immediately due and payable without any declaration or other act on the part of the Holder.

 

6.             Governing Law. This Note is governed by, and is to be interpreted and enforced in accordance with, the internal laws of the State of New York, without giving effect to any choice of law or conflict of laws rules or provisions (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York.

 

7.             Consent to Jurisdiction and Venue. By accepting this Note, the Holder hereby irrevocably and unconditionally submits to the exclusive jurisdiction of, and venue in, any state or federal court located within the City of New York in the State of New York (any such court, a “Permitted Court”) for the purposes of any claim (including any complaint, counterclaim, or cross-claim), lawsuit, action, or litigation by or before any governmental entity (in each case whether civil, criminal or regulatory, whether at law or in equity, and whether sounding in contract, tort, or otherwise) (each of the foregoing, a “Suit”) arising out of or relating to this Note, and in each case the appropriate appellate courts therefrom, and, by accepting this Note, the Holder agrees not to commence any such Suit in a court other than any Permitted Court. By accepting this Note, the Holder (a) hereby irrevocably

 

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and unconditionally waives any objection to the laying of venue of any Suit arising out of or relating to this Note in any Permitted Court, and (b) hereby irrevocably and unconditionally waives any objection that the Holder might now or in the future have, and agrees not to plead or claim, that any such Suit brought in any Permitted Court has been brought in an inconvenient forum.

 

8.             Waiver of Jury Trial. By accepting this Note, to the extent permitted by law, the Holder hereby irrevocably and unconditionally waives any right that the Holder might have to a trial by jury in any Suit arising out of or relating to this Note. By accepting this Note, the Holder acknowledges that: (a) the Holder has considered the implications of the waiver in this Section 8; (b) the Borrower will continue to rely upon the waiver in this Section 8 in the Borrower’s future dealings arising out of or relating to this Note; and (c) this provision is a material inducement for the Borrower to issue this Note to the Holder.

 

9.             Amendments; Waivers.

 

(a)           This Note can be amended if, and only if, such amendment is in writing and is signed by both the Borrower and the Holder.

 

(b)           No waiver by the Holder of the Holder’s rights, powers, or privileges hereunder, and no failure or delay by the Holder in exercising any of the Holder’s rights, powers, or privileges hereunder, will be enforceable against the Holder unless such waiver was given in a written instrument signed by the Holder. No single or partial exercise of the Holder’s rights, powers, or privileges under this Note will preclude any other or further exercise thereof or the exercise of any other right, power, or privilege hereunder or otherwise.

 

10.                               Assignment. By accepting this Note, the Holder acknowledges that the Holder shall not, and shall not purport to, assign any of the Holder’s rights hereunder without the prior written consent of the Borrower, and any such purported assignment without obtaining such written consent will be void.

 

11.                               No Third-Party Beneficiaries. No provision hereof is intended to confer, will confer, or will be deemed to confer benefits, rights, or remedies upon any person other than upon the Holder and the Borrower, their respective successors, and their respective permitted assigns.

 

12.                               Captions. Titles, captions, and headings included herein are for convenience of reference only and do not affect the meaning, construction, or interpretation hereof or of any provision hereof.

 

13.                               Severability. If any portion or provision hereof is to any extent determined to be illegal, invalid, or unenforceable by a court of competent jurisdiction, then the remainder hereof, and the application of such portion or provision in circumstances other than those as to which it is so determined to be illegal, invalid, or unenforceable, as applicable, will not be affected thereby. Without limiting the generality of the immediately foregoing sentence, if any portion or provision hereof is determined by any court of competent jurisdiction to be unenforceable by reason of excessive scope as to geographic, temporal,

 

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or functional coverage, then such provision will be deemed to extend only over the maximum geographic, temporal, and functional scope as to which such court determines it is permitted to be enforceable.

 

14.                               Interpretation; Construction. Except as otherwise expressly provided this Note: (a) in instances in which a word or phrase is defined herein, each of the other grammatical forms of such word or phrase has a correlative meaning; (b) the terms “hereof,” “herein,” “hereunder,” “hereby,” “hereto,” “herewith,” and words of import similar to any of the foregoing are to be construed to refer to this Note as a whole and not to any particular Section or provision of this Note; (c) a reference herein to a “Section” is a reference to a section of this Note; (d) the words “include,” “includes,” and “including” as used herein are deemed to be followed by the words “without limitation” and the canon of construction ejusdem generis is not to be applied with respect to the construction thereof; and (e) the symbol “$” means United States dollars. Any rule of construction or interpretation otherwise requiring this Note to be construed or interpreted against the Borrower or the Holder by virtue of the authorship hereof is not to affect the construction and interpretation hereof.

 

15.                               Business Day. If any date by which an action is to be taken hereunder falls on a date that is not a Business Day, then such date is deemed to refer to the first Business Day after such date. “Business Day” means a day other than a Saturday, Sunday, or other day on which commercial banks in New York, New York are authorized or required by law to close.

 

[Signature page follows]

 

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This Note is being signed by the Borrower as of the Effective Date.

 

	
 
    	
SFX   HOLDING CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Shelly Finkel
    
	
 
    	
 
    	
Name:   Shelly Finkel
    
	
 
    	
 
    	
Title:   President

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