EXHIBIT 10.36
[COPY]
THE SECURITY REPRESENTED BY THIS INSTRUMENT WAS ORIGINALLY ISSUED ON OCTOBER
16, 2001 AND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THE TRANSFER OF SUCH SECURITY IS SUBJECT TO THE CONDITIONS
SPECIFIED IN THE PURCHASE AGREEMENT, DATED AS OF OCTOBER 15, 2001, BETWEEN
THE ISSUER HEREOF AND JZ EQUITY PARTNERS PLC, AND THE ISSUER HEREOF RESERVES
THE RIGHT TO REFUSE THE TRANSFER OF SUCH SECURITY UNTIL SUCH CONDITIONS HAVE
BEEN FULFILLED WITH RESPECT TO SUCH TRANSFER. UPON WRITTEN REQUEST, A COPY
OF SUCH CONDITIONS WILL BE FURNISHED BY THE ISSUER HEREOF TO THE HOLDER
HEREOF WITHOUT CHARGE.
SAFETY HOLDINGS, INC.
13.0% NOTE
DUE OCTOBER 31, 0000
Xx. X-000 Xxx Xxxx, Xxx Xxxx
$6,750,000 October 26, 2001
SAFETY HOLDINGS, INC., a Delaware corporation (the "COMPANY"), for
value received, hereby promises to pay to the order of FAIRHOLME PARTNERS, L.P.
("FAIRHOLME"), or registered assigns, on October 31, 2011, the principal amount
of $6,750,000, with interest (computed on the basis of a 360-day year of
twelve 30-day months) from the date hereof on the unpaid balance of such
principal amount at the rate of 13.0% PER ANNUM, payable semi-annually on each
April 30 and October 31 or, if such day is not a Business Day, the next
succeeding Business Day (each, an "INTEREST PAYMENT DATE") after the date
hereof, commencing April 30, 2002, until such unpaid principal shall become due
and payable (whether at maturity or at a date fixed for prepayment or by
declaration or otherwise), and with interest on any overdue principal and
premium, if any, and (to the extent permitted by applicable law) on any overdue
interest at the rate of 15% PER ANNUM, payable semi-annually as aforesaid or,
at the option of the registered holder hereof, on demand.
Payments of principal and interest on this Note shall be made in
lawful money of the United States of America at the principal office of
Fairholme Partners, L.P., at 00 Xxxx X. Xxxxxxx Xxxxxxx, Xxxxx Xxxxx, Xxx
Xxxxxx, 00000 or at such other office or agency in Short Hills, New Jersey
as the registered holder of this Note shall have designated by written notice
to the Company as provided in the Purchase Agreement referred to below. The
Company may treat the Person in whose name this Note is registered on the
register kept by the Company as provided in such Purchase Agreement as the
owner of this Note for the purpose of receiving payment and for all other
purposes, and the Company shall not be affected by any notice to the contrary.
This Note is one of the Company's 13.0% Notes due October 31, 2011
(the "NOTES"), originally issued in the aggregate principal amount of
$30,000,000 pursuant to a purchase agreement, dated as of October 15, 2001
(together with all amendments and other modifications, if any, from time to
time thereafter made thereto, the "PURCHASE AGREEMENT"), between the Company
and JZEP. The registered holder of this Note is entitled to the benefits of
the Purchase Agreement and may enforce the agreements of the Company contained
therein and exercise the remedies provided for thereby or otherwise available
in respect thereof. Reference is made to ARTICLE VIII of the Purchase
Agreement for the subordination provisions applicable hereto for the benefit of
the holders of "Senior Indebtedness" in the event of a substantive
consolidation of the estate of the Company with the estate of its wholly-owned
subsidiary Xxxxxx Xxxxx Corporation.
The Notes are subject to optional prepayment, in whole or in part
and without premium or penalty, and are entitled to mandatory redemption, all
as specified in the Purchase Agreement. The Notes are also subject, under
certain circumstances, by the terms of the Purchase Agreement to the payment,
on not more than two Interest Payment Dates, of accrued interest then due
hereon by the delivery to the holder, IN LIEU of cash, of an additional note
in the amount of such accrued interest, bearing interest at a rate of 15.0%
PER ANNUM and otherwise in the form of this Note. In case an Event of
Default, as defined in the Purchase Agreement, shall occur and be continuing,
the unpaid balance of the principal of this Note may be declared and become
due and payable in the manner and with the effect provided in the Purchase
Agreement. By acceptance of this Note, each holder authorizes the
Representative Noteholder (as defined in the Purchase Agreement), to act on
behalf of such holder for all purposes for which the Representative
Noteholder is permitted to act pursuant to the Purchase Agreement and each
other Purchase Document (as defined in the Purchase Agreement) and agrees to
reimburse, exculpate and indemnify the Representative Noteholder and
otherwise agrees to be bound as a Noteholder in accordance with SECTION 4.11
of the Purchase Agreement.
This Note is a registered Note and, as provided in the Purchase
Agreement, is transferable only upon surrender of this Note for registration
of transfer, duly endorsed, or accompanied by a written instrument of
transfer duly executed, by the registered holder hereof or his attorney duly
authorized in writing.
This promissory note is the subject of an irrevocable proxy, dated
October 26, 2001 (the "PROXY"), granted by the holder to JZ Equity Partners PLC
("JZEP") appointing JZEP as the holder's attorney-in-fact, with full power of
substitution, with full authority to take any and all actions and to deliver
any and all documents and instruments which JZEP in its sole and absolute
discretion may deem necessary, appropriate or desirable for purposes of the
Purchase Agreement or as permitted by law, including in any bankruptcy,
insolvency, liquidation or similar proceduring of Safety Holdings, Inc. The
Proxy will terminate upon the occurrence of certain events described therein.
This Note is made and delivered in New York, New York and shall be
governed by the internal laws of the State of New York.
SAFETY HOLDINGS, INC.
By: /s/ A. Xxxxxxx Xxxxxx, Xx.
------------------------------------
Name: A. Xxxxxxx Xxxxxx, Xx.
Title: Vice President
