by and among IP HOLDINGS LLC AND ICONIX BRAND GROUP, INC. (f/k/a CANDIE’S, INC.) AND MICA FUNDING, LLC Dated as of August 28, 2006
by
and among
IP
HOLDINGS LLC
AND
ICONIX
BRAND GROUP, INC. (f/k/a CANDIE’S, INC.)
AND
MICA
FUNDING, LLC
Dated
as of August 28, 2006
THIS
NOTE
PURCHASE AGREEMENT (this “Agreement”)
is
dated as of August 28, 2006 and is by and among IP Holdings LLC, a Delaware
limited liability company (the “Issuer”),
Iconix Brand Group, Inc., (f/k/a Candie’s, Inc.), a Delaware corporation
(“Iconix”),
and
Mica Funding, LLC, a Delaware limited liability company (the “Purchaser”).
W
I T N E
S S E T H
WHEREAS,
Iconix, pursuant to that certain Capital Contribution Agreement, dated August
28, 2006, by and between Iconix and the Issuer (the “London
Fog Contribution Agreement”),
is
contributing certain Assets to the Issuer;
WHEREAS,
the Issuer (a) has pledged to Wilmington Trust Company (the “Trustee”)
for
the benefit of the Noteholders, all of the right, title and interest (but none
of the obligations) in and to the Collateral pursuant to that certain Fifth
Amended and Restated Indenture, dated as of August 28, 2006, by and between
the
Issuer and the Trustee (the “Fifth
Amended and Restated Indenture”)
and
(b) contemporaneously herewith has issued its $159,941,998 IP Holdings LLC
Asset-Backed Notes (the “Notes”)
pursuant to terms of the Fifth Amended and Restated Indenture; and
WHEREAS,
the Issuer desires to sell the Notes to the Purchaser, and the Purchaser desires
to purchase the Notes.
NOW,
THEREFORE, the parties hereto agree as follows:
Section
1. Definitions.
All
capitalized terms used and not otherwise defined herein shall have the meanings
set forth in the Fifth Amended and Restated Standard Definitions attached hereto
as Appendix A. The Fifth Amended and Restated Indenture, the Security
Agreements, the London Fog Contribution Agreement, the Management Agreement
and
the Servicing Agreement are collectively referred to herein as the “Operative
Documents”.
Section
2. Terms
of Issuance of the Notes.
The
Issuer agrees to sell the Notes, and subject to the terms and obligations of
this Agreement, the Purchaser agrees to purchase the Notes on the Closing Date
for the cash amount of $29,000,000 and the exchange of the April Notes for
the
Notes (the “Purchase
Price”).
The
Notes shall be registered in such names (which may be, if so indicated, a
nominee name) as the Purchaser may direct. The Notes shall include the legend
regarding restrictions on transfer set forth in Section 2.2 of the Fifth Amended
and Restated Indenture.
The
closing of the sale of the Notes (the “Closing”)
shall
be held at the office of Xxxxx & XxXxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, at 10:00 AM New York City time, on August 28, 2006,
(the “Closing
Date”)
or at
such other date and time as may be acceptable to the parties
hereto.
2
The
cash
portion of the Purchase Price shall be paid to the Issuer or its designee on
the
Closing Date by wire transfer of federal funds or other immediately available
funds in accordance with written instructions furnished by the Issuer not later
than two Business Days preceding the Closing Date. The April Notes shall be
delivered to the Trustee, and the Trustee shall acknowledge receipt thereof,
on
the Closing Date.
In
addition to the delivery of the Notes, the Issuer shall execute and deliver
on
the Closing Date (a) each of the Operative Documents and (b) an appropriate
receipt acknowledging receipt of the Purchase Price for its Notes.
Section
3. Representations
and Warranties of Iconix and the Issuer.
Except
as provided in paragraph (b) below, Iconix, for itself, the Manager and IPHM,
and the Issuer, for itself and only itself, severally represent and warrant
to
the Purchaser, as of the Closing Date as follows (but (I) in each case only
with
respect to the portions of the representations and warranties that specifically
refer to Iconix (and the Manager and IPHM), in the case of Iconix, or the
Issuer, in the case of the Issuer and (II) in the case of information and
documents supplied after the Closing Date, only with respect to such information
and documents supplied by Iconix (or the Manager and IPHM), in the case of
Iconix, or the Issuer, in the case of the Issuer):
(a) Each
of
the Issuer and the Manager is a limited liability company duly formed, validly
existing and in good standing under the laws of the State of Delaware, with
power and authority to own its properties and conduct its business as now being
and hereafter proposed to be conducted; and each of the Issuer and the Manager
is duly qualified to do business as a foreign entity in good standing in all
other jurisdictions in which its ownership or lease of property or the conduct
of its business requires such qualification, except in such jurisdictions where
the failure to be so qualified could not reasonably be expected to have a
materal adverse effect on its ability to perform its obligations under the
Operative Documents to which it is a party.
(b)
(i) Each
of Iconix and IPHM is an entity duly formed, validly existing and in good
standing under the laws of the State of Delaware, with power and authority
(corporate and other) to own its properties and conduct its business as now
being and hereafter proposed to be conducted; (ii) Iconix is duly qualified
to
do business as a foreign corporation in good standing in all other jurisdictions
in which its ownership or lease of property or the conduct of its business
requires such qualification, except in such jurisdictions where the failure
to
be so qualified could not reasonably be expected to have a materal adverse
effect on the ability of Iconix to perform its obligations under the London
Fog
Contribution Agreement; and (iii) IPHM is duly qualified to do business as
a
foreign entity in good standing in all other jurisdictions in which its
ownership or lease of property or the conduct of its business requires such
qualification, except in such jurisdictions where the failure to be so qualified
could not reasonably be expected to have a material adverse effect on the
ability of IPHM to perform its obligations under the Operative Documents to
which it is a party.
3
(c) Each
of
the Issuer, IPHM, Iconix and the Manager has full power and authority to execute
and deliver the Operative Documents delivered on the Closing Date to which
it is
a party, and to perform its respective obligations thereunder, and in the case
of the Issuer, to authorize, issue and sell the Notes as contemplated by this
Agreement. The Notes, this Agreement and each of the Operative Documents to
which Iconix, IPHM, the Manager or the Issuer are parties have been duly
authorized and on the Closing Date, each of such documents will have been duly
executed and delivered by the parties thereto.
(d) Assuming
the due authorization, execution and delivery thereof by the other parties
thereto, each Operative Document to which the Issuer, IPHM, Iconix or the
Manager is a party will constitute a valid and legally binding obligation of
such party, enforceable in accordance with its respective terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors’ rights
and to general equity principles.
(e) No
consent, approval, authorization, or order of, or filing with any governmental
agency or body or any court is required for the consummation of the transactions
contemplated by the Operative Documents or in connection with the issuance
and
sale of the Notes by the Issuer.
(f) The
consummation of the transactions contemplated by the Operative Documents to
which Iconix, IPHM the Issuer or the Manager, as the case may be, is a party,
and the fulfillment of the terms thereof will not (i) conflict with or result
in
a breach of, or constitute a default under, any of the provisions of any
indenture, mortgage, deed of trust, contract, or other instrument to which
any
of the Issuer, IPHM, Iconix or the Manager is a party or by which any of them
is
bound or (ii) result in a creation or imposition of any lien (other than the
Lien of the Fifth Amended and Restated Indenture) upon any of the properties
or
assets of any of the Issuer, IPHM, Iconix or the Manager pursuant to the terms
of any such indenture, mortgage, deed of trust, contract or other
instrument.
(g) The
execution, delivery and performance of each of the Operative Documents to which
any of Iconix, IPHM, the Issuer or the Manager, as the case may be, is a party,
and the issuance and sale of the Notes by the Issuer and compliance with the
terms and provisions thereof will not result in a breach or violation of any
of
the terms and provisions of, or constitute a default under, any statute, rule,
regulation or order of any governmental agency or body or any court, domestic
or
foreign, having jurisdiction over the Issuer, IPHM, Iconix, the Manager or
any
of their properties, or any agreement or instrument to which the Issuer, IPHM,
Iconix or the Manager is a party or by which the Issuer, IPHM, Iconix or the
Manager is bound or to which any of the properties of the Issuer, IPHM, Iconix
or the Manager is subject, or the organizational documents of the Issuer, IPHM,
Iconix or the Manager.
(h) Each
of
the Issuer, IPHM, Iconix and the Manager possesses all necessary certificates,
authorities or permits issued by appropriate governmental agencies or bodies
necessary to conduct the business now operated by such party and has not
received any notice of
proceedings relating to the revocation or modification of any such certificate,
authority or permit that, if determined adversely to the Issuer, IPHM, Iconix
or
the Manager, as the case may be, would individually or in the aggregate have
a
material adverse effect on such party.
4
(i) Iconix
has (i) acquired good and indefeasable title to the London Fog Assets (as
defined in the London Fog Contribution Agreement) (ii) acquired such assets
for
fair value, and (iii) consummated such acquisition substantially in accordance
with that certain Asset Purchase Agreement, dated as of August 21, 2006, between
Iconix and London Fog Group, Inc..
(j)
The
Licenses identified on Exhibit A-2 to the London Fog Contribution Agreement
constitute all licenses which relate to the London Fog trademark to which the
Issuer shall be a party as licensor.
(k) There
are
(i) no claims of infringement in connection with use of the Trademarks, (ii)
no
proceedings or circumstances which would materially adversely affect the value
of the applications and registrations listed in Exhibit
A-1A
to the
London Fog Contribution Agreement, and (iii) no facts or claims that would
prevent Iconix from having unrestricted use of the applications and
registrations listed in Exhibit
A-1A
to the
London Fog Contribution Agreement in connection with the corresponding goods
and/or services.
(l) There
are
no pending actions, suits or proceedings against or affecting the Issuer, IPHM,
Iconix, the Manager or any of their respective properties that, if determined
adversely to such party, would individually or in the aggregate have a material
adverse effect on such party, or would materially and adversely affect the
ability of the Issuer, IPHM, Iconix or the Manager, as the case may be, to
perform its respective obligations under any of the Operative Documents to
which
it is a party, or which are otherwise material in the context of the sale of
the
Notes; and, to each of the Issuer’s, IPHM’s, Iconix’s and the Manager’s
knowledge, no such actions, suits or proceedings are threatened or
contemplated.
(m) Assuming
that the Notes are offered in the manner contemplated by this Agreement, that
the Purchaser’s representations and warranties in the investor letter,
substantially in the form attached hereto as Exhibit
A,
are
true and correct in all material respects and that any subsequent holder of
a
Note complies with Section 3.5 of the Fifth Amended and Restated Indenture,
the
Issuer is not an open-end investment company, unit investment trust or
face-amount certificate company that is or is required to be registered under
Section 8 of the United States Investment Company Act of 1940, as amended,
(the
“Investment
Company Act”);
and
the Issuer is not and, after giving effect to the offering and sale of the
Notes
and the application of the proceeds thereof, will not be an “investment company”
as defined in the Investment Company Act.
5
(n) No
form
of general solicitation or general advertising was used by Iconix, IPHM, the
Manager or the Issuer or its representatives in connection with the offer and
sale of the Notes. No investors were solicited or otherwise approached by
Iconix, IPHM, the Manager or the Issuer or any representative of any of them
for
the purpose of offering the Notes for sale who were not institutional investors.
The Issuer has not issued or sold any Notes within the six-month period
immediately preceding the date hereof or securities that could be integrated
with the Notes. Neither the Issuer nor any representative on its behalf has
offered or sold, nor will any of them offer or sell, any Notes in any manner
that would render the issuance and sale of the Notes a violation of the
Securities Act or any state securities or “Blue Sky” laws, or require
registration pursuant thereto, nor has any of them authorized, nor will any
authorize, any Person to act in such manner.
(o) Neither
this Agreement nor any other document, certificate or statement furnished to
the
Purchaser by or on behalf of the Issuer or Iconix 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,
in
light of the circumstance in which they were made, not misleading. There is
no
fact or facts peculiar to Iconix or any of its Affiliates which materially
adversely affects or in the future may (so far as the Issuer can now reasonably
foresee), individually or in the aggregate, reasonably be expected to materially
adversely affect the business, property or assets, or financial condition of
Iconix or any of its Affiliates and which has not been set forth in this
Agreement or in the other documents, certificates and statements furnished
to
the Purchaser by or on behalf of the Issuer prior to the date hereof in
connection with the transactions contemplated hereby.
(p) Assuming
that the Purchaser’s representations and warranties in the investor letter,
substantially in the form attached hereto as Exhibit
A,
are
true and correct in all material respects, the offer and sale of the Notes
to
the Purchaser in the manner contemplated by this Agreement will be exempt from
the registration requirements of the Securities Act and it is not necessary
to
qualify an indenture in respect of the Notes under the United States Trust
Indenture Act of 1939, as amended (the “Trust
Indenture Act”).
(q) Each
of
the representations and warranties of the Issuer, IPHM, Iconix and the Manager
set forth in each of the Operative Documents to which they are a party is true
and correct in all material respects.
(r) No
Transaction Document has been terminated or amended, except as pursuant to
the
consummation of the transactions contemplated by the Operative Documents or
in
connection with the issuance and sale of the Notes by the Issuer.
(s) Any
taxes, fees and other governmental charges in connection with the execution
and
delivery of the Operative Documents or the execution, delivery and sale of
the
Notes have been or will be paid prior to the Closing Date.
6
Section
4. Representations
and Warranties of the Issuer.
(a) The
Notes
have been duly authorized; and when the Notes are authenticated, delivered
and
paid for pursuant to this Agreement on the Closing Date, such Notes will have
been duly executed, authenticated, issued and delivered and will constitute
valid and legally binding obligations of the Issuer, enforceable against the
Issuer in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles.
(b) The
Issuer has not entered and will not enter into any contractual arrangement
with
respect to the distribution of the Notes except for this Agreement.
Section
5. Covenants
of Iconix and the Issuer.
(a) Iconix
will pay all present and future recording and filing fees, and all legal,
financial and miscellaneous out-of-pocket expenses and costs incurred in
connection with the negotiation and consummation of this Agreement and closing
the transactions hereby contemplated, including, but not limited to (i) all
expenses incidental to the performance of its or the Manager’s obligations under
the Operative Documents including all expenses in connection with the execution,
issue, authentication, packaging and initial delivery of the Notes, the
preparation of the Operative Documents and any other document relating to the
issuance, offer, sale and delivery of the Notes; (ii) the fees and expenses
of
Standard & Poor’s Corporation CUSIP Service Bureau in connection with
obtaining a private placement number with respect to the Notes; and (iii) the
agreed upon fees, expenses and disbursements of Xxxxx & XxXxxxxx LLP.
Without limiting any provisions of the Operative Documents, the Issuer further
agrees that it will pay or cause to be paid, promptly upon demand, all
reasonable expenses incurred by the Purchaser in connection with the making
of
any amendments, supplements or modifications to, or the giving of any release,
consent or waiver in respect of, this Agreement and any Operative Document
executed pursuant hereto or thereto, including the fees and disbursements of
counsel for the Purchaser in connection therewith, in each case that are related
to or arising out of a request of, or an action taken by or that are otherwise
required or caused by, directly or indirectly, the Issuer, IPHM, Iconix or
the
Manager, whether or not such modifications or amendments are consummated or
all
consents are obtained. Without limiting the any provisions of the Operative
Documents, the Issuer further agrees that it will pay, or reimburse the
Purchaser for, promptly upon demand, all costs and expenses (including
reasonable legal fees and disbursements) incident to or in connection with
(i)
any action taken by the Purchaser, in good faith, to enforce its rights and
remedies under this Agreement or any other Operative Document and (ii) any
bankruptcy or insolvency proceedings involving Iconix or IPHM or any of their
Affiliates.
(b) The
Issuer shall use its reasonable efforts to ensure that it will not be or become,
a management company, unit investment trust or face-amount certificate company
that is or is required to be registered under Section 8 of the Investment
Company Act, although it may rely on the investor letter delivered by the
Purchaser and assume compliance with the provisions of Section 3.5 of the Fifth
Amended and Restated Indenture. The Issuer further agrees to comply with the
undertaking stated to be made by it in the final sentence of paragraph 5 of
the
investor letter delivered by the Purchaser.
7
Section
6. Conditions
of the Purchaser’s Obligations.
The
obligations of the Purchaser to purchase and pay for the Notes on the Closing
Date will be subject to the accuracy of the representations and warranties
on
the part of the Issuer and Iconix herein, the accuracy of the statements of
officers of the Issuer made pursuant to the provisions hereof, to the
performance by the Issuer of its obligations hereunder and to the following
additional conditions precedent:
(a) There
shall not have occurred (i) any change, or any development or event involving
a
prospective change, in the condition (financial or other), business, properties
or results of operations of the Issuer, IPHM, Iconix, the Manager or any of
their respective Affiliates which, in the judgment of the Purchaser, is material
and adverse and makes it impractical or inadvisable to proceed with completion
of the purchase of the Notes; (ii) any downgrading in the rating of any debt
securities of Iconix or any of its Affiliates by any “nationally recognized
statistical rating organization” (as defined for purposes of Rule 436(g) under
the Securities Act), or any public announcement that any such organization
has
under surveillance or review its rating of any debt securities of Iconix or
any
of its Affiliates (other than an announcement with positive implications of
a
possible upgrading, and no implication of a possible downgrading, of such
rating); (iii) any suspension or limitation of trading in securities generally
on the New York Stock Exchange or any setting of minimum prices for trading
on
such exchange, or any suspension of trading of any securities of Iconix or
any
of its Affiliates on any exchange or in the over-the-counter market; (iv) any
banking moratorium declared by U.S. Federal or New York authorities; or (v)
any
outbreak or escalation of major hostilities in which the United States is
involved, any declaration of war by Congress, any financial market disruption
or
any other substantial national or international calamity or emergency if, in
the
judgment of the Purchaser, the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable to
proceed with completion of the purchase of the Notes.
(b) The
Notes
shall have been duly authorized, executed, authenticated, delivered and issued
and shall be entitled to the benefits of the Fifth Amended and Restated
Indenture. Each of the Operative Documents and this Agreement shall have been
duly authorized, executed and delivered by the respective parties thereto and
shall be in full force and effect, and all conditions precedent contained in
the
Operative Documents shall have been satisfied.
(c) The
Purchaser and the Trustee shall have each received a counterpart original,
together with any required conformed copies of the Operative Documents and
all
closing documents delivered at or prior to the Closing.
(d) The
Purchaser and the Trustee shall have each received signature and incumbency
certificates executed by the authorized officers or manager of each of the
Issuer, IPHM, Iconix and the Manager, to enable each of them to enter into
the
Operative Documents to which such entity is a party.
8
(e) All
corporate, limited liability company and other proceedings in connection with
the transactions contemplated hereby and the other Operative Documents and
all
documents, opinions and certificates incident thereto shall be satisfactory
in
form and in substance to the Purchaser, and the Purchaser shall have received
such other documents and certificates incident to such transaction as the
Purchaser shall reasonably request.
(f) The
Purchaser shall have received from counsel to each party to the Operative
Documents (including the Servicer, the Manager and the Trustee), written
opinions dated the Closing Date and in form and substance satisfactory to the
Purchaser, covering such matters as the Purchaser may reasonably request,
including but not limited to the following:
(i) Corporate
Opinions.
An
opinion in respect of each party to the Operative Documents that such party
has
been duly formed and is existing and in good standing under the laws of its
State of formation, with all requisite power and authority to own its properties
and conduct its business; and such party is duly qualified to do business as
a
foreign entity in good standing in all other jurisdictions in which its
ownership or lease of property or the conduct of its business requires such
qualification, except where the failure to be so qualified, individually or
in
the aggregate, would not reasonably be expected to have a material adverse
effect on the financial position of such party.
(ii) Legal,
Valid, Binding and Enforceable.
An
opinion in respect of each party to the Operative Documents and this Agreement
that each such document to which it is a party has been duly authorized,
executed and delivered and constitutes the valid and legally binding obligation
of each party, enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws
of
general applicability relating to or affecting creditors’ rights and to general
equity principles.
(iii) Notes.
An
opinion that the Notes have been duly authorized, executed, authenticated,
issued and delivered; and constitute valid and legally binding obligations
of
the Issuer, enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws
of
general applicability relating to or affecting creditors’ rights and to general
equity principles.
(iv) No
Consents Required.
An
opinion in respect of each party to the Operative Documents that in respect
of
such party, no consent, approval, authorization or order of, or filing with,
any
governmental agency or body or any court is required for the consummation of
the
transactions contemplated by the Operative Documents, except as set forth or
contemplated therein.
9
(v) Litigation.
An
opinion (which may be from the General Counsel of Iconix) in respect of each
party to the Operative Documents that in respect of such party, to such
counsel’s knowledge (after due inquiry) there are no pending actions, suits or
proceedings against or affecting such party, any of its subsidiaries or any
of
their respective properties that, if determined adversely to such party or
any
of its subsidiaries, would individually or in the aggregate have a material
adverse effect, or would materially and adversely affect the ability of such
party to perform its obligations under the Operative Documents; and to such
counsel’s knowledge, no such actions, suits or proceedings are threatened or
contemplated.
(vi) Non-Contravention.
An
opinion (which in the case of clause (a)(ii) and (b) may be from the General
Counsel of Iconix) in respect of each party to the Operative Documents that,
in
respect of such party, the execution, delivery and performance of the Operative
Documents to which it is a party will not result in a breach or violation (a)(i)
of any of the terms and provisions of, or constitute a default under, any
statute, any rule, regulation or, (ii) to such counsel’s knowledge, of any order
of any governmental agency or body or any court having jurisdiction over such
party or any subsidiary of such party or any of their properties, or (b) to
such
counsel’s knowledge, of any agreement or instrument to which such party or any
such subsidiary is a party or, to such counsel’s knowledge, by which such party
or any such subsidiary is bound or to which any of the properties of such party
or any such subsidiary is subject, or the organizational documents of such
party
or any such subsidiary.
(vii) Securities
Laws.
An
opinion that it is not necessary in connection with the offer, sale and delivery
of Notes by the Issuer to the Purchaser pursuant to this Agreement to register
the Notes under the Securities Act or to qualify the Fifth Amended and Restated
Indenture under the Trust Indenture Act.
(viii) Investment
Company Act.
An
opinion that the Issuer is not and, after giving effect to the offering and
sale
of the Notes and the application of the proceeds thereof, will not be an
“investment company” as defined in the Investment Company Act.
(ix) Federal
Income Tax.
An
opinion that for U.S. federal income tax purposes, the Notes will be treated
as
indebtedness of the Issuer.
(x) Contribution.
An
opinion to the effect that in the event that Iconix was to become a debtor
in a
case under the Bankruptcy Code, a court of competent jurisdiction would hold
that the Assets would not constitute property of Iconix’s bankruptcy
estate.
10
(xi) Non-Consolidation.
An
opinion to the effect that in the event that Iconix was to become a debtor
in a
case under the Bankruptcy Code, a court of competent jurisdiction would not
disregard the separate existence of Iconix, on the one hand, and the Issuer,
on
the other hand, so as to order the substantive consolidation of the assets
and
liabilities of (a) the Issuer, on the one hand, and (b) Iconix, on the other
hand.
(xii) Security
Interests.
An
opinion to the effect that (i) in the event that the transfer of the Assets
from
Iconix to the Issuer shall be considered a loan secured by the Assets, upon
execution of the London Fog Contribution Agreement and upon the filing of
financing statements, assignments and trademark filings with the Patent and
Trademark Office related thereto (collectively, the “Filing
Statements”),
the
Issuer will have a perfected first priority security interest in the Assets
which may be perfected by filing in the United States, and (ii) upon execution
of the Fifth Amended and Restated Indenture, and upon the filing of the Filing
Statements related thereto, the Trustee will have a perfected first priority
security interest in the Collateral which may be perfected by filing in the
United States.
(xiii) Intellectual
Property Title Opinion.
An
opinion to the effect that (A) the Issuer owns the Assets contributed pursuant
to the London Fog Contribution Agreement, (B) each application and registration
with respect to such Assets is owned by the Issuer and will, upon proper filing
or recording, stand in the name thereof on the records of all relevant office
registries, free and clear of any liens, (C) each Asset relating to a trademark
contributed by Iconix is a valid trademark and (D) to the knowledge of such
counsel, there are no claims or proceedings regarding infringement in connection
with the use of, or threaten the validity or value of the Assets.
(g) The
Purchaser shall have received from each party to the Operative Documents such
information, certificates and documents as the Purchaser may reasonably have
requested and all proceedings in connection with the transactions contemplated
by this Agreement and all documents incident hereto shall be in all material
respects reasonably satisfactory in form and substance to the
Purchaser.
(h) The
CUSIP
Service Bureau of Standard & Poor’s shall have assigned a private placement
number for the Notes and the Purchaser shall have received evidence reasonably
satisfactory to the Purchaser of such number.
(i) The
Purchaser shall have received evidence satisfactory to it from the Trustee,
confirming receipt by the Trustee of the deposit of funds into the Liquidity
Reserve Account pursuant to Section 12.1 of the Fifth Amended and Restated
Indenture in the amount of $1,350,000 on the Closing Date.
11
(j) The
Purchaser shall have received evidence reasonably satisfactory to it and its
special counsel that UCC-1 financing statements and any other similar statements
or documentation with respect to perfection of security interests in the Assets
for the benefit of the Issuer and the Trustee have been, or will be, filed
in
the appropriate filing offices in the Covered Jurisdictions, and all other
actions have been taken reflecting the assignment of the interests of Iconix
in
the Assets to the Issuer, as required pursuant to the provisions of the London
Fog Contribution Agreement.
(k) On
or
before the Closing Date, the Purchaser shall have received a fee calculated
as
0.20689% of the Initial London Fog Note Principal Balance.
(l) The
fees
and expenses identified in Section 5(a) shall have been paid or provided for
to
the satisfaction of the Purchaser.
(m) The
Asset
Purchase Agreement, dated as of August 21, 2006 between Iconix and London Fog
Group, Inc. shall have been approved pursuant to Section 363(b) of the
Bankruptcy Code by the U.S. Bankruptcy Court of the District of Nevada, pursuant
to an Order substantially in the form attached as Exhibit C to such agreement,
finding, among other things that (i) the Debtors (as defined in such Order)
are
the sole owners of the London Fog Assets and have the power and authority to
convey full and complete title to the London Fog Assets to Iconix, and (ii)
the
assignment to Iconix of the London Fog Assets shall be free and clear of all
claims and liens of any kind pursuant to Section 363(f) of the Bankruptcy
Code.
(n) The
Issuer’s acceptance of the proceeds of the Notes shall be deemed its
acknowledgement that the conditions to Closing set forth herein have been
complied with as of the Closing Date.
The
Purchaser may in its sole discretion waive compliance with any conditions to
the
obligations of the Purchaser hereunder.
Section
7. Indemnification.
(a) Each
of
the Issuer and Iconix jointly and severally agrees (i) to indemnify and hold
harmless the Purchaser, its members, employees, managers, directors and officers
and each person, if any, who controls such Purchaser within the meaning of
Section 15 of the Securities Act, against any losses, claims, damages or
liabilities, joint or several, to which such Purchaser may become subject,
under
the Securities Act or the Securities Exchange Act of 1934, as amended (the
“Exchange
Act”)
or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in
respect thereof) arise out of or are based upon any breach of any of the
representations and warranties of, or with respect to, the Issuer, IPHM, the
Manager or Iconix contained herein, provided, however, that (i) the Issuer
shall
only indemnify the indemnified parties with respect to breaches of the Issuer’s
representations and warranties and not with respect to a breach by any other
party and (ii) Iconix shall not indemnify the indemnified parties with respect
to any breach of an Issuer representation and warranty pertaining to the Assets
or any Issuer continuing representations or warranties made herein that relate
to, or require, action to be taken by the Issuer after the Closing Date,
including the payment of the Notes.
12
(b) The
obligations of the Issuer and Iconix under this Section shall be in addition
to
any liability which the Issuer or Iconix may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Purchaser within the meaning of Section 15 of the Securities Act or the Exchange
Act.
Section
8. Failure
to Deliver.
If,
after 3:00 p.m. on the Closing Date, the Closing has not yet been consummated
and the Issuer has requested the Purchaser to continue to make the Purchase
Price available later that day, and if, by 5:00 p.m. New York City time on
such
day, the Issuer fails to tender to the Purchaser the Notes or if the conditions
specified in Section 6 hereof have not been fulfilled or waived by the
Purchaser, the Purchaser may thereupon elect to be relieved of all further
obligations under this Agreement. In addition, Iconix shall pay to the Purchaser
interest on the Purchase Price of its Notes at a variable per annum rate
specified by the Purchaser, from such date until the next succeeding Business
Day on which it is feasible for the Purchaser to invest such moneys in overnight
funds. Nothing in this Section shall relieve the Issuer or Iconix from any
of
its obligations hereunder or otherwise or waive any of the Purchaser’s rights
against the Issuer or Iconix.
Section
9. Survival
of Certain Representations and Obligations.
The
respective indemnities, agreements, representations, warranties and other
statements of the Issuer and Iconix and of the Purchaser or any of their
respective officers set forth in or made pursuant to this Agreement will remain
in full force and effect, regardless of any investigation, or statement as
to
the results thereof, made by or on behalf of the Purchaser, Iconix, the Issuer
or any of their respective representatives, officers or directors or any
controlling person, and will survive delivery of and payment for the Notes.
If
for any reason the purchase of the Notes by the Purchaser is not consummated,
other than as a result of a breach by the Purchaser, Iconix shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
5 and the obligations of the Issuer and Iconix pursuant to Section 7 shall
remain in effect. If the purchase of the Notes is not consummated for any reason
other than because of either (i) a failure of the Purchaser to fund after all
conditions to Closing have been met or (ii) the occurrence of any event
specified in clause (iii), (iv) or (v) of Section 6(a), Iconix will reimburse
the Purchaser for all out-of-pocket expenses (including fees and disbursements
of counsel) reasonably incurred by it in connection with the offering of the
Notes.
Section
10. Severability
Clause.
Any
part, provision, representation, or warranty of this Agreement which is
prohibited or is held to be void or unenforceable in any jurisdiction shall,
as
to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof.
Section
11. Notices.
All
communications hereunder will be in writing and, (A) if sent to the Purchaser
will be mailed, delivered or telegraphed and confirmed to the Purchaser, at
Mica
Funding, LLC, c/x Xxxxxxxxx Global Strategies, 000 Xxxxxxx Xxxxxx, 0xx
Xxxxx,
Xxx Xxxx, XX 00000, with a copy to PartnerRe New Solutions Inc. (“PartnerRe”),
Xxx
Xxxxxxxxx Xxxxx, Xxxxxxxxx, XX 00000-0000, Attention: Chief Counsel, (B) if
sent
to the Issuer, will be mailed, delivered or telegraphed and confirmed to it
at
IP Holdings LLC, 000 Xxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000, Attention:
General Counsel, or (C) if sent to Iconix, will be mailed, delivered or
telegraphed and confirmed to it at Iconix Brand Group, Inc., 0000 Xxxxxxxx,
Xxx
Xxxx, XX 00000, Attention: General Counsel; provided,
however,
that
any notice to the Purchaser pursuant to Section 7 will be mailed, delivered
or
telegraphed and confirmed to such Purchaser.
13
Section
12. Successors
and Third-Party Beneficiaries.
This
Agreement will inure to the benefit of and be binding upon the parties hereto
and their respective successors and the controlling persons referred to in
Section 7 and no other person, other than as expressly provided in this
paragraph, will have any right or obligation hereunder. It is agreed by the
parties hereto that PartnerRe shall be a third-party beneficiary of the
obligations of the Issuer and Iconix hereunder.
Section
13. Applicable
Law.
THIS
AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE
STATE OF NEW YORK, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW
OTHER
THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF
NEW YORK. The Issuer, the Purchaser and Iconix hereby submit to the
non-exclusive jurisdiction of the Federal and state courts in the Borough of
Manhattan in The City of New York in any suit or proceeding arising out of
or
relating to this Agreement or the transactions contemplated hereby.
Section
14. Counterparts,
etc.
This
Agreement supersedes all prior or contemporaneous agreements and understandings
relating to the subject matter hereof between the Purchaser, Iconix and the
Issuer. Neither this Agreement nor any term hereof may be changed, waived,
discharged or terminated except by a writing signed by the party against whom
enforcement of such change, waiver, discharge or termination is sought. This
Agreement may be signed in any number of counterparts each of which shall be
deemed an original, which taken together shall constitute one and the same
instrument.
Section
15. No
Petition.
(a)
During the term of this Agreement and for one year and one day after the
retirement of the Notes, none of the parties hereto or any affiliate thereof
will file any involuntary petition or otherwise institute any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding or other
proceeding under any federal or state bankruptcy or similar law against the
Issuer. The obligations of such parties under this Section 15(a) shall survive
any termination of this Agreement.
(b) Each
of
the parties hereto (other than the Purchaser) agrees that it will not institute
against, or join any other person in instituting against, the Purchaser any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding,
or other similar proceeding under the laws of any jurisdiction, for one year
and
one day after the latest maturing commercial paper note of the Purchaser is
paid
in full. The obligations of such parties under this Section 15(b) shall survive
any termination of this Agreement.
14
Section
16. Limited
Recourse.
The
obligations of the Purchaser under this Agreement are solely the obligations
of
the Purchaser. No recourse shall be had for the payment of the Purchase Price
or
any other obligation or claim of or against the Purchaser arising out of or
based upon this Agreement, against any employee, officer, director, affiliate,
member or manager of the Purchaser or any affiliate of such person (other than
with respect to Section 17 below); provided, however, that the foregoing shall
not relieve any such person of any liability it might otherwise have as a result
of fraudulent actions or omissions taken by it. Each party to this Agreement
(other than the Purchaser) agrees that the Purchaser shall be liable for any
claims that such party may have against the Purchaser only to the extent the
Purchaser has funds in excess of those needed by it to pay amounts due from
it
on matured or maturing commercial paper notes or due from it to hedge
counterparties in connection with its commercial paper program. Any and all
claims by any such party against the Purchaser shall be unsecured and
subordinate to the claims of the holders of the Purchaser’s commercial paper
notes and of all other secured parties under the Purchaser’s commercial paper
program.
Section
17. Confidentiality.
Neither
Iconix, the Purchaser nor any of their respective Affiliates shall make any
announcement or disclosure regarding the participation of PartnerRe or any
of
its Affiliates in connection with the transactions contemplated in the Operative
Documents, without the prior written consent of PartnerRe, except that Iconix
or
the Purchaser may disclose such information to such Person’s external
accountants and attorneys and as required by any supervisory regulatory
authority to which the disclosing party is subject or under applicable law
or
order in connection with any judicial proceeding. If, for any other reason
than
a breach of this Section 17 by Iconix and the Purchaser or a breach of any
another confidentiality agreement between PartnerRe and the parties hereto,
the
confidential information herein otherwise becomes public, then Iconix and the
Purchaser shall be permitted to disclose such public information.
Section
18. Survival
of Note Purchase Agreement Representations and Warranties.
Each of
the Issuer and Iconix agree that each representation and warranty made by it
in
the Note Purchase Agreement shall survive notwithstanding the exchange of the
Original Notes and the Subordinate Notes for the July Notes or the exchange
of
the July Notes for the September Notes or the exchange of the September Notes
for the April Notes or the exchange of the April Notes for the Notes. Each
of
the representations and warranties of the Issuer and Iconix in the Note Purchase
Agreement, the 2005 Note Purchase Agreement, the 2005-B Note Purchase Agreement
and the 2006 Note Purchase Agreement are true and correct as of the date thereof
and are hereby incorporated by reference.
Section
19. No
Advisory or Fiduciary Responsibility.
Each of
the Issuer and Iconix acknowledges and agrees that: (i) the purchase and sale
of
the Notes pursuant to this Agreement, including the determination of the
offering price of the Notes and any related discounts and commissions, is an
arm’s-length commercial transaction among the Issuer, Iconix and the Purchaser
and each of the Issuer and Iconix is capable of evaluating and understanding
and
understands and accepts the terms, risks and conditions of the transactions
contemplated by this Agreement; (ii) in connection with the purchase and sale
of
the Notes, the Purchaser is and has been acting solely as a principal and is
not
the agent or fiduciary of either of the Issuer or Iconix, or their respective
affiliates, stockholders, creditors or employees or any other party; (iii)
the
Purchaser has not assumed and will not assume an advisory or fiduciary
responsibility in favor of either of the Issuer or Iconix with respect to any
of
the transactions contemplated hereby; (iv) the Purchaser and its affiliates
may
be engaged in a broad range of transactions that involve interests that differ
from those of either of the Issuer or Iconix and that the Purchaser has no
obligation to disclose any of such interests by virtue of any fiduciary or
advisory relationship; and (v) the Issuer and Iconix shall each consult with
its
own advisors concerning the purchase and sale of the Notes and shall be
responsible for making their own independent investigation and appraisal of
the
transaction contemplated hereby, and the Purchaser shall not have any
responsibility or liability to the Issuer or Iconix with respect
thereto.
[REMAINDER
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15
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by
their respective officers thereunto duly authorized as of the day and year
above
first written.
| ICONIX BRAND GROUP, INC. | ||
| |
|
|
| By: | /s/ Xxxx Xxxx | |
|
Name: |
||
| Title: | ||
| IP HOLDINGS LLC | ||
| |
|
|
| by: | IP
Holdings and Management Corporation its Manager |
|
| by: | /s/ Xxxxxxx X. Xxxxxx | |
|
Name: Xxxxxxx X. Xxxxxx |
||
| Title: Secretary | ||
| MICA FUNDING, LLC | ||
| |
|
|
| by: | Xxxxxxxxx
Global
Strategies LLC its Investment Advisor |
|
| by: | /s/ Xxxxxx Xxxxxxx | |
|
Name: Xxxxxx Xxxxxxx |
||
| Title:
Managing Director Xxxxxxxxx Global Strategies, LLC |
||
16
List
of Omitted Appendices and Exhibits
APPENDIX
A - Definitions
EXHIBIT
A
- Form of Investor Letter
