FJC gets award from Marc Hand, Pacifica’s fixer for the FJC deal (Mark Cohen; Erin Moran)
On 2Apr2018, Tom Livingston & Lorin Silverman signed the $3.7m loan contract between Pacifica (legally the Pacifica Foundation, Inc.) & the Foundation for the Jewish Community (legally FJC). Pacifica’s broker was Public Media Company (PMC), which had put Chief Executive Officer Marc Hand on the case.
A few months later, the July issue of FJC Quarterly showed what happens when business goes well. The joyous occasion was attended by Marc, of course, together with Mark C Cohen, FJC’s Chief Legal Officer (& Assistant Secretary), & Erin Moran, PMC’s Chief Financial Officer. There was talk of FJC, of course, & of PMC, & some gift-giving & -receiving – but no mention of Pacifica. Even so, a one-year anniversary deserves celebration, don’t you think? http://fjc.org/uploads/newsletters/0047-july-2018-newsletter.pdf
And business did go well. PMC earnt their origination fee. OK, only 1.5% you may say, but that is $55 500 (the loan agreement, Section 3.1(2); page 6). And that payment came from Pacifica listeners: Pacifica has agreed to pay all costs arising from the contract – “[to] pay legal and other loan related fees” (Recital B; p. 1), & “at Borrower’s cost and expense, each in form and content satisfactory to the Lender” (Sec. 3.1(1)-(11); pp. 6-7). https://mega.nz/#F!PloCiSqJ!9rLejSkttE7gCVCCq3q86g?b0IBlaiR
And FJC, just by sitting there, earnt its own consideration (benefit), but decided to forego its origination fee, instead plumbing for underwriting credits of 1% of the loan amount, so $37k (Sec. 3.1(2); pp. 6-7; & p. 25). So, rather than take money directly from the listeners, they chose to make Pacifica enter into an advertising contract. (That suited Pacifica financially, if not politically – please see link at the end.)
Pacifica’s advertising contract is to be with F.Y. Eye, Inc. (Exhibit B; pp. 25-7), an advertising broker in NYC. I wondered why FJC didn’t take cash from Pacifica, for the benefit of the FJC account holders funding the loan. Now I know why – and I’ll give the answer in the next post on these matters.
(The circuit made by the advertising credits is described here: https://pacificaradiowatch.home.blog/2019/07/21/underwriting-section-of-fjc-loan-contract-drives-pacificas-urgency-for-an-advertising-policy/.)
[AN ASIDE: Note that Pacifica’s interest rate falls by 0.25 percentage points, to 8.25% a year, from tomorrow, Th1Aug. The change was made today by a Federal Reserve cttee that decides a rate that prime & others are tied to. The saving is smaller than you think: $8 162.50 a year (1% is $32 650). But mustn’t grumble. https://www.jpmorganchase.com/corporate/About-JPMC/historical-prime-rate.htm ]