FORBEARANCE AGREEMENT
Exhibit
10.1
FORBEARANCE
AGREEMENT, dated as of April 3, 2009 (this "Agreement"), by and
among (i) ICO NORTH AMERICA, INC., a Delaware corporation (the "Borrower"), (ii) each
Subsidiary Guarantor party hereto (together with the Borrower, each a "Company" and
collectively, the "Companies"), (iii)
the Lenders party hereto, (iv) Jefferies Finance LLC, as lead arranger, book
manager, documentation agent and syndication agent, (v) Jefferies Finance
LLC, as administrative agent for the Lenders (in such capacity, together with
its successors and assigns in such capacity, the "Administrative Agent") and (vi) The
Bank of New York Mellon (formerly known as The Bank of New York), as collateral
agent for the Lenders (the "Collateral
Agent").
RECITALS
A. The
Borrower, the Subsidiary Guarantors, the Lenders, the Collateral Agent and the
Administrative Agent, and the other parties hereto are parties to the Amended
and Restated Revolving Credit Agreement, dated as of April 7, 2008 (as amended
or otherwise modified prior to the date hereof, the "Credit Agreement"),
pursuant to which the Lenders extended certain commitments and made certain
loans and other financial accommodations available to the
Borrower. The obligations of the Borrower under the Credit Agreement
are guaranteed by the Subsidiary Guarantors and are secured by the Pledged
Collateral.
B. As of the
date hereof, certain material Defaults have occurred and are continuing, which
are listed on Exhibit A hereto, and such Defaults will become Events of Default
on April 7, 2009 (hereinafter referred to collectively as the "Specified Events of
Default").
C. The
Borrower has requested that the Administrative Agent and the Lenders temporarily
forbear from exercising their rights and remedies as a result of the occurrence
and continuance of the Specified Events of Default under the Credit Agreement.
D. The
Administrative Agent and the Lenders are willing to grant
such forbearance on a limited basis, subject to the terms and conditions of this
Agreement.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants,
representations, warranties and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Definitions.
(a) Any
capitalized term used herein and not defined shall have the meaning assigned to
it in the Credit Agreement.
(b) As used
in this Agreement, the following terms shall have the respective meanings
indicated below, such meanings to be applicable equally to both the singular and
plural forms of such terms:
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"Forbearance Effective Date" has
the meaning assigned to it in Section 4.
"Forbearance Period"
means the period commencing on the Forbearance Effective Date and ending on the
Termination Date, unless earlier terminated pursuant to the terms and provisions
of this Agreement.
"Paid in Full" means that the
Obligations (other than contingent indemnification obligations for which no
claim has been made or arisen) shall be repaid in full in cash and all
Commitments shall be terminated.
"Secured Creditor Remedies" means any
default-related action by any Agent or any Lender to sell, foreclose,
repossess or liquidate any of the Pledged Collateral.
"Termination Date"
means 11:00 a.m. (New York Time) on the Final Maturity Date.
"Termination Event"
means any one or more of the following: (i) any representation or warranty made
or deemed made by or on behalf of any Company or by any officer of the foregoing
under or in connection with this Agreement or under or in connection with any
report, certificate or other document delivered to any Agent or any Lender
pursuant to this Agreement shall have been incorrect in any material respect
when made or deemed made, (ii) any Company shall fail to perform or comply with
any covenant or any agreement or term contained in this Agreement, (iii) any
Default or Event of Default, other than the Specified Events of Default, shall
occur and be continuing under the Credit
Agreement or any of the other Loan Documents, or (iv) any "Event of Default", as
such term is defined in the Convertible Indenture, shall occur and be
continuing.
2. Acknowledgements of the
Companies.
(a) The
Borrower and each other Company acknowledge and agree that as of April 2, 2009,
the aggregate principal balance of the Loans on such date (inclusive of
capitalized interest) is $43,722,222.00 (the “Existing
Principal”). The Borrower and each other Company acknowledge
and agree that as of April 2, 2009, the aggregate amount of accrued and unpaid
and uncapitalized interest of the Loans is $1,396,682.00 (the “Existing Interest”) and the
accrued and unpaid fees payable pursuant to Section 2.05 of the Credit Agreement
is $370,180.00 (the “Existing
Fees”; collectively with the Existing Principal and the Existing
Interest, the “Outstanding
Indebtedness”). The foregoing amounts do not include other
fees, expenses and other amounts that are chargeable or otherwise reimbursable
under the Credit Agreement and the other Loan Documents. Neither the
Borrower nor any other Company has any rights of offset,
defense, claim or counterclaim with respect to any of the
Obligations.
(b) The
Borrower and each other Company acknowledge and agree that the Specified Events
of Default constitute Defaults, and on and after April 7, 2009, will constitute
Events of Default, that have occurred and are continuing as of the date hereof,
are not capable of being cured and are material. The existence of the
Specified Events of Default (i) relieved the Lenders and the Agents from any
obligation to extend any Loan or provide other financial accommodations under
the Credit Agreement or other Loan Documents and (ii) would, but for the
existence of this Agreement, permit the Lenders and the Agents to, among other
things, (A) accelerate all or any portion of the Obligations and (B) subject to
the terms of the Collateral Trust Agreement, (1) commence any legal or other
action to collect any or all of the Obligations from the Borrower and any other
Company and/or any Pledged Collateral, (2) exercise any Secured Creditor
Remedies, including, without limitation, by foreclosing or otherwise realizing
upon any or all of the Pledged Collateral and/or setting off and applying any
deposits or other amounts or proceeds of Pledged Collateral to the payment of
any or all of the Obligations, and (3) take any other enforcement action or
otherwise exercise any or all rights, remedies, powers and privileges provided
for by any or all of the Credit Agreement, the other Loan Documents, applicable
law and/or equity.
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3. Limited Forbearance by the
Agents and the Lenders.
(a) Temporary
Forbearance. In accordance with the terms and subject to the
conditions of this Agreement and only so long as no Termination Event shall have
occurred and be continuing, the Agents and the Lenders agree to temporarily forbear until the
Termination Date from (i) declaring all of the Obligations to be immediately due
and payable, (ii) foreclosing or
directing the foreclosure upon the Pledged Collateral, and (iii) exercising any
other Secured Creditor Remedies with respect to the Pledged Collateral, in each
case, solely by reason of, or as a result of the occurrence of, the Specified
Events of Default.
(b) Limited Effect of
Forbearance. Notwithstanding the foregoing, the Companies and
the Lenders acknowledge and agree that the temporary forbearance granted by the
Agents and the Lenders pursuant to this Agreement shall not constitute, and
shall not be deemed to constitute, a waiver of the Specified Events of Default
or of any other Default or Event of Default under the Loan Documents or a waiver of any of the rights and
remedies provided thereunder, under law, at equity or otherwise (except as otherwise expressly provided in Section
3(a)).
(c) Termination of
Forbearance. On and after the Termination Date, or such
earlier date on which a Termination Event occurs
and is continuing, the Agents' and the Lenders' agreement hereunder to
forbear shall terminate automatically without the requirement of any demand,
presentment, protest, notice or further act or action by the Agents or the
Lenders. Each Company expressly acknowledges and agrees that the
effect of such termination will be to permit the Agents and the Lenders to
demand that the Obligations be Paid in Full and to exercise any and all other
rights and remedies available to them under the Loan Documents and this
Agreement, at law, in equity (including, without limitation, any Secured
Creditor Remedy), or otherwise without any further lapse of time, expiration of
applicable grace periods, or (except as otherwise required under provisions of
applicable law that cannot be waived) requirements of notice to any Company, all
of which are expressly waived by each Company.
(d) Default Interest. The
Administrative Agent, the Lenders and the Companies hereby agree that (i)
effective April 7, 2009, the Obligations shall accrue interest at the Default
Rate and (ii) such interest shall be payable in cash upon the earlier of (a) the
occurrence of a Termination Event and (b) the Termination Date.
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4. Conditions to Effectiveness;
Post-Closing Obligations.
(a) This
Agreement shall become effective and be deemed effective as of the date when,
and only when, the Administrative Agent shall have received a copy of this
Agreement, duly executed by the Companies, the Administrative Agent and the
Required Lenders (the date of such effectiveness being referred to as the “Forbearance Effective
Date”):
(b) The
Borrower shall pay to the Administrative Agent within one Business Day of the
Forbearance Effective Date, for the account of or as directed by each Lender on
a pro rata basis, a nonrefundable fee equal to 0.75% of the Existing Principal,
in immediately available funds, in Dollars, which fee shall be earned in full
when paid.
(c) The
Borrower shall pay the invoiced legal fees and expenses of counsel to the
Required Lenders in respect of the negotiation, preparation, execution and
delivery of this Agreement within three Business Days of the receipt of such
invoice.
(d) The
Companies shall deliver to the Administrative Agent within three Business Days
of the Forbearance Effective Date:
(i) a
certificate from the Secretary of the Borrower (A) attesting to the resolutions
of the Borrower's Board of Directors authorizing the execution, delivery and
performance by the Borrower of this Agreement and the other Loan Documents to be
executed and delivered pursuant hereto to which the Borrower is a party, and the
performance of the Credit Agreement, as amended, (B) authorizing specific
officers of the Borrower to execute the same, and (C) attesting to the
incumbency and signatures of such specific officers of the Borrower;
and
(ii) the
financial statements for the fiscal year ended December 31, 2008 required under
Section 5.01(a) of the Credit Agreement and the related documents required under
Section 5.01(d) of the Credit Agreement, excluding the requirement that the
auditor opinion accompanying such financial statements be delivered without a
going concern qualification.
(e) The
Companies shall deliver to the Administrative Agent within five Business Days of
the Forbearance Effective Date a counterpart signature page to this Agreement,
duly executed by the Collateral Agent.
Any
breach of the obligations set forth in Section 4(b), 4(c), 4(d) or 4(e) above
shall constitute a Termination Event.
5. Ratification of Loan
Documents and Pledged Collateral. Each Company acknowledges
that this Agreement constitutes receipt from the Agents and the Lenders of
proper notice of default, and subject to the terms and conditions of this
Agreement, notice of intent to accelerate and opportunity to cure, and demand
for payment. Each Company waives to the extent permitted by law (a)
any further notice of default, notice of intent to accelerate, or demand for
payment and (b) any further opportunity to cure the Specified Events of
Default. Except as modified by this Agreement, each Company
acknowledges, ratifies, reaffirms, and agrees that the Collateral Trust
Agreement and the perfected liens and security interests created thereby in
favor of the Collateral Agent for the benefit of the Lenders and the other
secured parties referred to therein in the Pledged Collateral are, and will
remain, in full force and effect and binding on all of the Companies and are
hereby ratified and confirmed in all respects. Each Company
acknowledges, ratifies and reaffirms all of the terms and provisions of the Loan
Documents (including, without limitation, the Credit Agreement), except as
modified herein, which are incorporated by reference as of the Forbearance
Effective Date as if set forth herein including, without limitation, all
promises, agreements, warranties, representations, covenants, releases, and
indemnifications contained therein.
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6. Insolvency Proceedings; FCC
Matters.
(a) Insolvency Proceedings and
Certain Waivers. Each Company agrees that if any Insolvency
Proceeding with respect to any Company exists, subject to and in furtherance of
the terms set forth in the Collateral Trust Agreement:
(i) such
Company shall not directly or indirectly object to, challenge, contest or
otherwise seek to invalidate or reduce (or support directly or indirectly any
other person in any such objection, challenge or contest) (A) the existence,
validity or amount of the obligations or (B) the extent, legality, validity,
perfection, priority or enforceability of any lien, pledge, security interest or
mortgage of the Collateral Agent purportedly securing any of the
Obligations;
(ii) such
Company shall not seek to subordinate or recharacterize any claim of the
Collateral Agent or any Lender against any other Company; and
(iii) such Company acknowledges and
agrees that the waivers set forth in this Section constitute material
consideration for the Agents and the Lenders to execute and deliver this
Agreement and that the Agents and the Lenders are specifically relying on the
truth and accuracy of the foregoing.
(b) FCC
Matters. For the purposes of exercising any of their Secured
Creditor Remedies at any time that the Forbearance Period shall cease to be in
effect, subject to and in furtherance of the terms set forth in the Collateral
Trust Agreement, the Companies agree with the Agent and the Lenders as
follows:
(i) The
Agents and the Lenders are empowered to request, and each Company agrees to
authorize, the appointment of a receiver or trustee from any court of competent
jurisdiction. Such receiver or trustee shall be instructed to seek
from the FCC (and any other Governmental Authority) all requisite consents to
and approvals of any assignment of any FCC License and assets of, or any transfer of
control of over any Person whose stock, partnership interests, other securities
or other Pledged Collateral is subject to the Collateral Trust Agreement to the
extent required for such trustee or receiver to be granted the rights necessary
to accomplish the purpose of seeking a bona fide purchaser to whom such FCC
License ultimately will be assigned or control of such entity ultimately will be
transferred, subject to FCC and any other governmental approvals.
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(ii) Each
Company agrees, at the joint and several cost and expense of the Companies, to
reasonably cooperate with any such purchaser referred to in clause (i) and with
the Agents and Lenders in the preparation, execution and filing of any
applications and other documents and providing any information that may be
reasonably necessary in obtaining the FCC's consent to the assignment or
transfer to such purchaser of the Pledged Collateral or any portion thereof or
any of any FCC License.
(iii) To the
fullest extent permitted by applicable law, each Company hereby agrees to
consent to and authorize any such transfer of control or assignment upon the
request of the Agents or Lenders following a Termination Event or other
expiration of the Forbearance Period, without limiting any rights of the Agents
or Lenders under this Agreement or any other Loan Document to authorize the
Agents or Lenders to nominate a trustee or receiver to assume control of the
Pledged Collateral, subject only to any required consents, approvals or orders
of courts of competent jurisdiction, the FCC or other Governmental Authority,
for the purpose of effectuating the transactions contemplated in this Section
6(b) and the other provisions of this Agreement and the other Loan
Documents. Such trustee or receiver shall have all the rights and
powers as provided to it by law, court order or the Agents or Lenders under this
Agreement and the other Loan Documents.
(iv) Each
Company shall cooperate fully and use commercially reasonable efforts in
obtaining the consent of the FCC and the approval or consent of each other
Governmental Authority required to effectuate the foregoing.
7. Representations and
Warranties. To induce the Agents and the Lenders to enter into
this Agreement, each Company hereby represents and warrants to the Agents and
the Lenders as follows:
(a) Duly
Organized. Each Company is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization, and
has the full power and authority to execute, deliver and perform this Agreement
and to perform the Credit Agreement, as amended hereby.
(b) Authority. The
execution, delivery and performance by such Company of this Agreement, and the
performance by such Company of the Credit Agreement, as amended hereby, and each
other Loan Document (i) have been duly authorized by all requisite action on the
part of such Company, (ii) do not and will not violate any provision of federal,
state, or local law or regulation applicable to such Company, the Organizational
Documents of such Company, or any order, judgment or decree of any court,
Governmental Authority or arbitrator by which such Company or any of its
properties is bound, (iii) do not and will not conflict with, result in a breach
of, or constitute (with due notice or lapse of time or both) a default under
Collateral Trust Agreement or any other contractual obligation of such Company
(including, without limitation, any Material Agreement of such Company) and (iv)
do not and will not require any filing (other than any disclosure filing) or
registration with, consent, or authorization or approval of, or notice to, or
other action with or by, any Governmental Authority or other
Person.
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(c) Binding
Obligation. Each of this Agreement and the Credit Agreement,
as amended hereby, constitutes the legal, valid and binding obligation of such
Company, enforceable against such Company in accordance with its terms, except
as enforcement may be limited by equitable principles or by bankruptcy,
insolvency, reorganization, moratorium, or similar laws relating to or limiting
creditors' rights generally.
(d) No Other
Defaults. Except for the Specified Events of Default, no
Default or Event of Default has occurred and is continuing or would result from
this Agreement becoming effective in accordance with its terms. No
"Event of Default", as such term is defined in the Convertible Indenture, has
occurred and is continuing or would result from this Agreement becoming
effective in accordance with its terms.
(e) Representations and
Warranties. All representations and warranties by the
Companies contained in the Credit Agreement and in each other Loan Document and
certificate or other writing delivered to any Agent or Lender pursuant to the
Credit Agreement or this Agreement are true and correct in all material respects
as of the Forbearance Effective Date
hereof, except (i) to the extent made as of
a specific date, in which case each such representation and warranty shall be
true and correct in all material respects as of such date, or (ii) to the extent that such
representation and warranties relate to the Specified Events of
Default.
8. Additional
Covenants. Commencing on the Forbearance Effective Date, and
thereafter, so long as any principal of or interest on any Loan, any fee or any
other Obligation (whether or not due) shall remain unpaid, the Borrower and each
other Company agree as follows:
(a) The
Companies shall diligently, speedily and expeditiously pursue in good faith and
on a commercially reasonable efforts basis a refinancing or repayment in full in
cash of the Obligations to be consummated on or prior to the last day of the
Forbearance Period (the "Refinancing"). The
Companies shall, and shall direct their advisors to, keep the Agents and the
Lenders apprised of all significant developments with respect to such
process.
(b) The
Companies shall diligently, speedily and expeditiously pursue in good faith and
on a commercially reasonable efforts basis a restructuring plan for their
business and a plan to repay the Obligations under the Credit Agreement, which
may include, without limitation, an equity investment from an Affiliate or third
party, a refinancing, an orderly divestment of assets, or other measures (the
"Restructuring
Plan").
(c) The
Companies shall, and shall cause their advisors to, cooperate in good faith with
all advisors retained by the Lenders and the holders of the Convertible Senior
Secured Notes in order to enable such advisors to (i) evaluate the Companies'
financial condition, business, operations and prospects and (ii) to evaluate the
Restructuring Plan. The Companies shall, and shall direct their
advisors to, keep the Agents and the Lenders apprised of all significant
developments with respect to the Restructuring Plan.
(d) The
Companies agree that, in accordance with Section 5.01(l) of the Credit
Agreement, promptly from time to time, the Companies shall furnish such other
information concerning the Refinancing or the Restructuring Plan as the
Administrative Agent or any Lender, acting pursuant to such Section 5.01(l), may
reasonably request.
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(e) Notwithstanding anything to the
contrary contained in Section 2.10 of the Credit Agreement, if any Company,
Holdings or any of their respective Subsidiaries (a “Recipient”) shall be
entitled to receive the Net Cash Proceeds of any of the following transactions,
in each case solely with respect to Auction Rate Securities owned by a
Company: (i) any ARS Conversion, (ii) any other disposition of
Auction Rate Securities or (iii) any Debt Issuance for which Auction Rate
Securities are pledged as collateral (an “ARS Margin Loan” and together with any
transaction described in subclause (i) or (ii), each an “ARS Transaction” and
collectively the “ARS Transactions”), then the Borrower shall cause 100% of all
such Net Cash Proceeds to be paid by such Recipient directly to the
Administrative Agent, immediately at such time that such Net Cash Proceeds are
received by such Recipient (provided that the Borrower will use commercially
reasonable efforts to cause such Net Cash Proceeds to be paid by the payor
directly to the Administrative Agent), which payment shall be applied as a
prepayments of the Obligations in accordance with Section 2.10(h) and (i) of the
Credit Agreement. Notwithstanding Section 6.01, 6.02 or 6.06 of the
Credit Agreement, no ARS Transaction shall be entered into by any Company,
Holdings or any of their respective Subsidiaries except where (A) 100% of the
consideration payable to such party (in the case of an ARS Conversion or a
disposition of Auction Rate Securities) or the proceeds to be received by such
party (in the case of an ARS Margin Loan) is payable in cash, (B) such
consideration (in the case of an ARS Conversion or a disposition of Auction Rate
Securities) represents fair value to such party and (C) in the case of an ARS
Margin Loan, such loan is extended on fair terms to such
party. Without limiting the generality of the preceding subclauses
(B) and (C), none of the Companies, Holdings or any Subsidiary shall enter into
any ARS Transaction unless either (x) the consideration payable to such party
(in the case of an ARS Conversion or a disposition of Auction Rate Securities)
or the proceeds to be received by such party (in the case of an ARS Margin Loan)
is equal to at least 60% of the par value of the applicable Auction Rate
Securities or (y) upon the closing of such ARS Transaction, the Obligations
shall be Paid in Full. The Required Lenders agree to review and
respond within two Business Days to any request from the Borrower for a waiver
that would permit an ARS Transaction not otherwise permitted under this clause
(e) (it being understood that no waiver shall be effective unless signed in
writing by the Required Lenders). Subject to the terms set forth in
this clause (e), the Required Lenders hereby consent to the incurrence by the
Borrower of any ARS Margin Loan.
(f) Notwithstanding anything to the
contrary contained in Section 2.10 of the Credit Agreement, if any Recipient
shall be entitled to receive the Net Cash Proceeds of any Asset Sale (solely
with respect to assets of a Company), Debt Issuance or Equity Issuance in
respect of any equity interest in a Company (or that is otherwise payable to a
Company) and as a result thereof, if such proceeds were received by any Company,
such proceeds would be required to be applied as a prepayment of the Obligations
pursuant to Section 2.10 of the Credit Agreement, then the Borrower shall cause
100% of all such Net Cash Proceeds to be paid directly by such Recipient to the
Administrative Agent, immediately at such time that such Net Cash Proceeds are
received by such Recipient (provided that the Borrower will use commercially
reasonable efforts to cause such Net Cash Proceeds to be paid by the payor
directly to the Administrative Agent), which payment shall be applied as a
prepayments of the Obligations in accordance with Section 2.10(h) and (i) of the
Credit Agreement.
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Any
breach of the obligations set forth in this Section 8 shall constitute a
Termination Event.
9. Remedies Upon Termination or
Expiration of Forbearance Period. Upon the occurrence of a
Termination Event, the Forbearance Period will terminate without further act or
action by the Agents or the Lenders. Upon the termination or
expiration of the Forbearance Period, the Agents and the Required Lenders shall
be entitled to (i) demand immediate payment in full in cash of all of the
Obligations (or if the Maturity Date has occurred or any Insolvency Event has
occurred, the Obligations shall automatically become due and payable without any
action of any Agent or Lender) and (ii) subject to the Collateral Trust
Agreement, immediately to exercise any and all rights and remedies available to
them under the Loan Documents and this Agreement, at law, in equity, or
otherwise, in each case without further opportunity to cure, demand,
presentment, notice of dishonor, notice of default, notice of intent to
accelerate, notice of intent to foreclose, notice of protest or other
formalities of any kind, all of which are expressly waived by each Company to
the extent permitted by law.
10. RELEASE AND COVENANT NOT TO
XXX. EACH COMPANY (IN ITS OWN RIGHT AND ON BEHALF OF ITS
DIRECTORS, OFFICERS, EMPLOYEES, INDEPENDENT CONTRACTORS, ATTORNEYS AND AGENTS)
(THE "RELEASING
PARTIES") JOINTLY AND SEVERALLY RELEASES, ACQUITS, AND FOREVER DISCHARGES
THE AGENTS AND THE LENDERS AND THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES,
INDEPENDENT CONTRACTORS, ATTORNEYS AND AGENTS, (COLLECTIVELY, THE "RELEASED PARTIES"),
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE STATE AND FEDERAL LAW, FROM ANY
AND ALL ACTS AND OMISSIONS OF THE RELEASED PARTIES, AND FROM ANY AND ALL CLAIMS,
CAUSES OF ACTION, COUNTERCLAIMS, DEMANDS, CONTROVERSIES, COSTS, DEBTS, SUMS OF
MONEY, ACCOUNTS, RECKONINGS, BONDS, BILLS, DAMAGES, OBLIGATIONS, LIABILITIES,
OBJECTIONS, AND EXECUTIONS OF ANY NATURE, TYPE, OR DESCRIPTION WHICH THE
RELEASING PARTIES HAVE AGAINST THE RELEASED PARTIES ARISING PRIOR TO THE DATE
HEREOF, INCLUDING, BUT NOT LIMITED TO, NEGLIGENCE, GROSS NEGLIGENCE, USURY,
UNCONSCIONABILITY, DURESS, ECONOMIC DURESS, DEFAMATION, CONTROL, INTERFERENCE
WITH CONTRACTUAL AND BUSINESS RELATIONSHIPS, CONFLICTS OF INTEREST, MISUSE OF
INSIDER INFORMATION, CONCEALMENT, DISCLOSURE, SECRECY, MISUSE OF COLLATERAL,
WRONGFUL RELEASE OF COLLATERAL, FAILURE TO INSPECT, ENVIRONMENTAL DUE DILIGENCE,
NEGLIGENT LOAN PROCESSING AND ADMINISTRATION, WRONGFUL SETOFF, VIOLATIONS OF
STATUTES AND REGULATIONS OF GOVERNMENTAL ENTITIES, INSTRUMENTALITIES AND
AGENCIES (CIVIL), SECURITIES AND ANTITRUST LAWS VIOLATIONS, TYING
ARRANGEMENTS, BREACH OR ABUSE OF ANY ALLEGED FIDUCIARY DUTY, BREACH OF ANY
ALLEGED SPECIAL RELATIONSHIP, COURSE OF CONDUCT OR DEALING, ALLEGED OBLIGATION
OF FAIR DEALING, ALLEGED OBLIGATION OF GOOD FAITH, AND ALLEGED OBLIGATION OF
GOOD FAITH AND FAIR DEALING, IN CONNECTION WITH OR RELATED TO THE
LOAN DOCUMENTS AND THE CREDIT AGREEMENT, AT LAW OR IN EQUITY, IN CONTRACT IN
TORT, OR OTHERWISE, KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED (COLLECTIVELY,
THE "RELEASED
CLAIMS"); PROVIDED, HOWEVER, THAT THE RELEASED CLAIMS SHALL NOT INCLUDE
ANY CLAIMS ARISING OUT OF ANY FAILURE BY ANY AGENT OR LENDER TO PERFORM, ON OR
AFTER THE DATE HEREOF, ANY OF THEIR RESPECTIVE OBLIGATIONS HEREUNDER OR UNDER
ANY OF THE LOAN DOCUMENTS OR THE CREDIT AGREEMENT. THE RELEASING
PARTIES FURTHER JOINTLY AND SEVERALLY AGREE TO LIMIT ANY DAMAGES THEY MAY SEEK
IN CONNECTION WITH ANY CLAIM OR CAUSE OF ACTION, IF ANY, TO EXCLUDE ALL PUNITIVE
AND EXEMPLARY DAMAGES, DAMAGES ATTRIBUTABLE TO LOST PROFITS OR OPPORTUNITY,
DAMAGES ATTRIBUTABLE TO MENTAL ANGUISH, AND DAMAGES ATTRIBUTABLE TO PAIN AND
SUFFERING, AND THE RELEASING PARTIES DO HEREBY JOINTLY AND SEVERALLY WAIVE AND
RELEASE ALL SUCH DAMAGES WITH RESPECT TO ANY AND ALL CLAIMS OR CAUSES OF ACTION
WHICH MAY ARISE AT ANY TIME AGAINST ANY OF THE RELEASED PARTIES. THE
RELEASING PARTIES REPRESENT AND WARRANT THAT, TO THEIR KNOWLEDGE, NO FACTS EXIST
WHICH COULD PRESENTLY SUPPORT THE ASSERTION OF ANY OF THE RELEASED CLAIMS
AGAINST THE RELEASED PARTIES. THE RELEASING PARTIES FURTHER COVENANT
NOT TO XXX THE RELEASED PARTIES ON ACCOUNT OF ANY OF THE RELEASED CLAIMS, AND
EXPRESSLY WAIVE ANY AND ALL DEFENSES THEY MAY HAVE IN CONNECTION WITH THEIR
DEBTS AND OBLIGATIONS UNDER THE LOAN DOCUMENTS AND THE CREDIT AGREEMENT (AS
AMENDED HEREBY). THIS SECTION 10 IS IN ADDITION TO AND SHALL NOT IN
ANY WAY LIMIT ANY OTHER RELEASE, COVENANT NOT TO XXX, OR WAIVER BY THE RELEASING
PARTIES IN FAVOR OF THE RELEASED PARTIES. NOTWITHSTANDING ANY PROVISION OF THE
CREDIT AGREEMENT (AS AMENDED HEREBY) OR ANY OTHER LOAN DOCUMENT, THIS SECTION 10
SHALL REMAIN IN FULL FORCE AND EFFECT AND SHALL SURVIVE THE DELIVERY AND PAYMENT
ON THE OBLIGATIONS, THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
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11. No Obligation of any Agent
or the Lenders. Each Company acknowledges and understands that
upon the expiration or termination of the Forbearance Period and if the
Specified Events of Default have not been waived by written agreement in
accordance with the Credit Agreement, or if there shall at such time exist a
Default or Event of Default, then the Agents and the Lenders shall have the
right to proceed to exercise any or all available rights and remedies, which may
include foreclosure on the Pledged Collateral and institution of legal
proceedings to the extent set forth herein in the Collateral Trust
Agreement. The Agents and the Lenders shall have no obligation
whatsoever to extend the maturity of the Obligations, waive any events of
default or defaults, defer any payments, or further forbear from exercising
their rights and remedies.
12. No Implied
Waivers. No failure or delay on the part of the Agents or the
Lenders in exercising, and no course of dealing with respect to, any right,
power or privilege under this Agreement, the Credit Agreement or any other Loan
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege under this Agreement, the Credit
Agreement or any other Loan Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. No
action or acquiescence by the Agents or the Lenders, including without
limitation, the making of any loan or the acceptance of any payment under the
Credit Agreement, shall constitute a waiver of, or a consent to, any default,
noncompliance, Default or Event of Default now existing or hereafter arising
under the Credit Agreement or any of the other Loan Documents (including,
without limitation, the Specified Events of Default).
10
13. INDEMNIFICATION. IN
ADDITION TO, AND WITHOUT LIMITATION OF, ANY AND ALL INDEMNITIES PROVIDED IN THE
LOAN DOCUMENTS, EACH COMPANY SHALL AND DOES
JOINTLY AND SEVERALLY INDEMNIFY AND HOLD EACH OF THE RELEASED PARTIES HARMLESS
FROM AND AGAINST ANY AND ALL CLAIMS, LIABILITY, LOSSES, DAMAGES, CAUSES OF
ACTION, SUITS, JUDGMENTS, COSTS, AND EXPENSES, INCLUDING, WITHOUT LIMITATION,
REASONABLE ATTORNEYS' FEES, ARISING OUT OF OR FROM OR RELATED TO ANY OF THE
RELEASED CLAIMS, EXCEPT TO THE EXTENT DETERMINED BY A COURT OF COMPETENT
JURISDICTION BY FINAL AND NONAPPEALABLE JUDGMENT TO HAVE DIRECTLY RESULTED
SOLELY FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH RELEASED
PARTY. IF ANY ACTION, SUIT, OR PROCEEDING IS BROUGHT AGAINST ANY OF
THE RELEASED PARTIES, EACH COMPANY SHALL, AT LENDERS' REQUEST, JOINTLY AND
SEVERALLY DEFEND THE SAME AT THEIR SOLE COST AND EXPENSE, SUCH COST AND EXPENSE
TO BE A JOINT AND SEVERAL LIABILITY OF THE COMPANIES, BY COUNSEL SELECTED BY THE
LENDERS. NOTWITHSTANDING ANY PROVISION OF THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT, THIS SECTION 13 SHALL REMAIN IN FULL FORCE AND EFFECT AND SHALL
SURVIVE ANY DELIVERY AND PAYMENT ON THE OBLIGATIONS, THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
14. Review and Construction of
Documents. Each Company hereby acknowledges, and represents
and warrants to the Agents and the Lenders, that:
(a) such
Company has had the opportunity to consult with legal counsel of their own
choice and have been afforded an opportunity to review this Agreement with their
legal counsel;
(b) such
Company has carefully reviewed this Agreement and fully understand all terms and
provisions of this Agreement;
(c) such
Company has freely, voluntarily, knowingly and intelligently entered into this
Agreement of their own free will and volition; and
(d) none of
the Agents or the Lenders has a fiduciary relationship with the Borrower or any
Company, and the relationship between the Agents and the Lenders, on the one
hand, and the Companies, on the other hand, is solely that of creditor and
debtor; and
(e) no joint
venture exists among the Companies, the Agents and the Lenders.
15. ENTIRE AGREEMENT;
AMENDMENT. THIS AGREEMENT AND THE LOAN DOCUMENTS AS
INCORPORATED HEREIN EMBODY THE FINAL, ENTIRE AGREEMENT BETWEEN THE PARTIES
HERETO REGARDING THE AGENTS' AND THE LENDERS' FORBEARANCE WITH RESPECT TO THEIR
RIGHTS AND REMEDIES ARISING AS A RESULT OF THE SPECIFIED EVENTS OF DEFAULT AND
SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND
UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER HEREOF
AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES
HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES
HERETO. The provisions of this Agreement may be amended or waived
only by an instrument in writing signed by the Companies, the Agents and the
Lenders. The Loan Documents, as modified by this Agreement, continue
to evidence the agreement of the parties with respect to the subject matter
thereof.
11
16. Miscellaneous.
(a) Notices. All
notices, requests, demands and other communications under this Agreement will be
given in accordance with the provisions of the Credit Agreement.
(b) Successors and
Assigns. This Agreement shall (i) be binding on the Agents, the Lenders,
the Companies and their respective successors and assigns, and (ii) inure to the
benefit of the Agents, the Lenders, the Companies and their respective
successors and assigns, provided that no Company may assign any rights or
obligations under this Agreement without the prior written consent of the Agents
and the Lenders.
(c) Tolling of Statutes of
Limitation. The parties hereto agree that all applicable
statutes of limitations with respect to the Loan Documents shall be tolled and
shall not begin to run again until the Termination Date.
(d) Interpretation. Wherever
the context hereof will so require, the singular shall include the plural, the
masculine gender shall include the feminine gender and the neuter and vice
versa. The headings, captions and arrangements used in this Agreement
are for convenience only and shall not affect the interpretation of this
Agreement.
(e) Severability. Any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining portions
hereof or affecting the validity or enforceability of such provision in any
other jurisdiction.
(f) Counterparts. This
Agreement may be executed and delivered in any number of counterparts, and by
different parties hereto on separate counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which
counterparts taken together shall constitute one and the same instrument;
provided that no party shall be bound by this Agreement until the Companies, the
Agents and the Required Lenders have executed a counterpart
hereof. Execution of this Agreement via facsimile or electronic mail
shall be effective, and signatures received via facsimile or electronic mail
shall be binding upon the parties hereto and shall be effective as
originals.
12
(g) Further
Assurances. Each Company agrees to execute, acknowledge,
deliver, file and record such further certificates, instruments and documents,
and to do all other acts and things, as may be reasonably requested by any Agent
or Lender as necessary or advisable to carry out the intents and purposes of
this Agreement.
(h) Survival of Representations
and Warranties. All representations and warranties made in
this Agreement or any other Loan Document will survive the execution and
delivery of this Agreement, and no investigation by the Agents or the Lenders or
any closing will affect the representations and warranties or the right of the
Agents or the Lenders to rely upon them.
(i) Loan
Document. This Agreement is a Loan Document for all purposes
of the Credit Agreement and the other Loan Documents.
(j) GOVERNING
LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK.
(k) JURY TRIAL
WAIVER. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER
BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE ACTIONS OF ANY AGENT OR ANY LENDER IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.
(l) Direction to Collateral
Agent. Each of the Administrative Agent and the Required
Lenders hereby (i) represents and warrants to the Collateral Agent that (a) the
execution and delivery of this Agreement by the Collateral Agent is authorized
or permitted under the Credit Agreement, the Collateral Trust Agreement and the
other Loan Documents and (b) it is authorized under the Credit Agreement, the
Collateral Trust Agreement and the other Loan Documents to direct the Collateral
Agent to execute and deliver this Agreement, and (ii) authorizes and
directs the Collateral Agent to execute and deliver this Agreement.
(m) Concerning the Collateral
Agent. The parties hereto acknowledge and agree that all of the rights,
privileges, protections, immunities and indemnities afforded the Collateral
Agent under the Credit Agreement, the Collateral Trust Agreement and the other
Loan Documents is hereby incorporated herein as if set forth herein in
full.
(n) Not Responsible for
Recitals. The recitals contained herein shall be taken as the
statements of the Companies, the Lenders and the Administrative Agent and the
Collateral Agent assumes no responsibility for their correctness. The
Collateral Agent makes no representations as to the validity or sufficiency of
this Agreement.
[Remainder
of page intentionally left blank.]
13
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first written above.
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BORROWER:
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ICO
NORTH AMERICA, INC.
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By:
/s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx
X. Xxxxxxx
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Title: Acting
Chief Executive Officer, Chief Financial Officer
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SUBSIDIARY
GUARANTORS:
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ICO SATELLITE MANAGEMENT,
LLC, as a Subsidiary
Guarantor
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By:
ICO North America, Inc., its sole member
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By:
/s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx
X. Xxxxxxx
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Title: Acting
Chief Executive Officer, Chief Financial Officer
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ICO GLOBAL COMMUNICATIONS
(CANADA) INC., as a
Subsidiary Guarantor
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By:
ICO North America, Inc., its parent
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By:
/s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx
X. Xxxxxxx
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Title: Acting
Chief Executive Officer, Chief Financial Officer
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EXECUTED
AS A DEED FOR AND ON BEHALF OF:
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ICO SATELLITE NORTH AMERICA
LIMITED, as a
Subsidiary Guarantor
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By:
ICO North America, Inc., its parent
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By:
/s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx
X. Xxxxxxx
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Title: Acting
Chief Executive Officer, Chief Financial Officer
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In
the presence of: /s/ Xxxx X. Xxxxx
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Name
of Witness: Xxxx X. Xxxxx
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Address
of Witness: c/o ICO
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00000
Xxxxx Xxxxxxx Xxxxx, Xxx 0000
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Xxxxxx,
XX 00000
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Forbearance
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ICO SATELLITE SERVICES LIMITED,
as a Subsidiary Guarantor
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By:
/s/ Xxxxx Xxxxxxx
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Name: Xxxxx
Xxxxxxx
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Title: Director
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ICO
SERVICES LIMITED, as a
Subsidiary Guarantor
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By:
/s/ Xxxxx Xxxxxxx
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Name: Xxxxx
Xxxxxxx
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Title: Director
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SSG
UK LIMITED, as a Subsidiary
Guarantor
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By:
/s/ Xxxxx Xxxxxxx
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Name: Xxxxx
Xxxxxxx
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Title: Director
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Forbearance
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ICO SATELLITE SERVICES
G.P., as a
Subsidiary Guarantor
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By:
ICO Services Limited, a general partner
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By:
/s/ Xxxxx Xxxxxxx
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Name: Xxxxx
Xxxxxxx
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Title: Director
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NEW ICO SATELLITE SERVICES
G.P., as a
Subsidiary Guarantor
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By:
ICO Satellite Services G.P., a general partner
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By:
ICO Services Limited, a general partner
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By:
/s/ Xxxxx Xxxxxxx
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Name: Xxxxx
Xxxxxxx
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Title: Director
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Forbearance
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ADMINISTRATIVE
AGENT:
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JEFFERIES
FINANCE LLC, as Administrative Agent
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By:
/s/ X.X. Xxxx
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Name: X.X.
Xxxx
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Title: Managing
Director
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Forbearance
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REQUIRED LENDERS:
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Special
Situations Investing Group, Inc., as a Lender
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By:
/s/ Xxxxxx X. Xxxxx III
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Name: Xxxxxx
X. Xxxxx III
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Title: Authorized
Signatory
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Forbearance
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CANPARTNERS INVESTMENTS IV,
LLC, as a Lender
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By:
/s/ Xxxxx Xxxxx
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Name: Xxxxx
Xxxxx
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Title: Authorized
Signatory
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Exhibit
A
Specified
Events of Default
The
Defaults, which on and after April 7, 2009, shall be Events of Default,
resulting from (a) the failure of the Companies to deliver as required by
Section 5.01(a) of the Credit Agreement not later than March 31, 2009 the
consolidated financial statements of the Borrower for the fiscal year ended
December 31, 2008 accompanied by an opinion of Deloitte & Touche LLP not
qualified as to scope and not containing any going concern or other
qualification or exemption and (b) the failure of the Companies to deliver as
required by Section 5.01(d) of the Credit Agreement the other items required to
be delivered concurrently with the consolidated financial statements of the
Borrower for the fiscal year ended December 31, 2008.
