Exhibit 10.1
HUNTSMAN INTERNATIONAL HOLDINGS LLC
000 Xxxxxxxx Xxx
Xxxx Xxxx Xxxx
Xxxx 00000
XXX
June 14, 2002
CSFB Global Opportunities Partners, L.P.
Eleven Madison Avenue, 16th Floor
New York, New York 10010
BNAC, Inc.
c/o CSFB Global Opportunities Partners, L.P.
Eleven Madison Avenue, 16th Floor
New York, New York 10010
REPRESENTATION AND INDEMNITY AGREEMENT
Ladies and Gentlemen:
Reference is hereby made to: (A) the Sale and Purchase Agreement
dated as of the date hereof (the "PURCHASE AGREEMENT"), among Imperial Chemical
Industries PLC, a company incorporated in England and Wales with registered
number 218019 (the "ICI PARENT"), ICI Americas Inc., a Delaware corporation
("ICI AMERICAS"), ICI Alta Inc., a Delaware corporation ("ICI ALTA"), ICI
Finance PLC, a company incorporated in England and Wales with registered number
45690 ("ICI FINANCE"), BNAC, Inc., a Delaware corporation ("BNAC") and CSFB
Global Opportunities Partners, L.P., a Delaware limited partnership ("GOF", and
together with BNAC, the "GOF PARTIES"), pursuant to which, among other things,
BNAC is (i) agreeing to purchase from ICI Americas on or prior to May 15, 2003,
all of the outstanding capital stock of ICI Alta, which in turn holds 300 Units
of Huntsman International Holdings LLC ("HIH"), a Delaware limited liability
company (the "HIH INTEREST"), and (ii) purchasing from ICI Finance all of the 8%
Senior Subordinated Reset Discount Notes due 2009 (the "B NOTES") issued by HIH,
and (B) the Letter Agreement dated December 20, 2001 (the "SIDE LETTER"), by and
between HIH and ICI Finance pursuant to which, among other things, HIH has
agreed to make certain representations, warranties and indemnities for the
benefit of a potential purchaser of the B Notes.
HIH hereby acknowledges that upon the performance of the
transactions contemplated in the Purchase Agreement ("ICI SALE TRANSACTIONS"),
HIH and Huntsman Corporation, a Utah corporation ("HC"), will receive certain
direct and indirect benefits, including, without limitation, the potential
release of a pledge made by Huntsman Specialty Chemicals Corporation, a Delaware
corporation and subsidiary of HC ("HSCC"), to ICI Alta and ICI Finance with
respect to 300 Units of HIH currently held by HSCC as well as assistance toward
achieving
key strategic initiatives. All capitalized terms used but not defined herein
shall have the meanings ascribed thereto in the Purchase Agreement.
In fulfillment of HIH's obligations under the Side Letter, in
recognition of the direct and indirect benefits received by HIH and in
consideration of and as an inducement to the GOF Parties entering into the
Purchase Agreement and consummating the transactions contemplated therein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged by the parties, the undersigned agrees as follows:
1 DEFINITIONS: For the purposes hereof:
(a) "AFFILIATE" shall mean, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under
common control with such Person.
(b) "ASSOCIATE" of any Person shall have the meaning assigned
thereto by Rule 12b-2 of the Exchange Act.
(c) "COMPANY" shall mean HIH and the Company Subsidiaries.
(d) "COMPANY DISCLOSURE LETTER" shall mean the disclosure
schedule dated as of the date hereof and attached hereto.
(e) "COMPANY MATERIAL ADVERSE EFFECT" shall mean a material
adverse effect on the business, financial condition (including levels
of working capital) or results of operations of HIH and the Company
Subsidiaries, taken as a whole.
(f) "COMPANY SUBSIDIARY" shall mean Huntsman International LLC
and any corporation, partnership, limited liability company, joint
venture or other legal entity in which HIH (either directly or through
or together with another Company Subsidiary) owns more than 50% of the
voting securities of such corporation, partnership, limited liability
company, joint venture or other legal entity.
(g) "EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as amended.
(h) "GOVERNMENTAL ENTITY" shall mean any Federal, state or local
government or any court, regulatory or administrative agency or
commission, governmental arbitrator or other governmental authority or
instrumentality, domestic or foreign
(i) "KNOWLEDGE," or any similar expression, with respect to HIH
shall mean and include actual knowledge, after due inquiry, of Xxx X.
Xxxxxxxx, Xxxxx X. Xxxxxxxx, J. Xxxx Xxxxxx, L. Xxxxxxx Xxxxx, Xxxxxx
X. Xxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxxx, and Xxxxx X. Xxxxxxx.
(j) "LAW" shall mean any Federal, state, local or foreign
statute, law, regulation, permit, license, approval, authorization,
rule, ordinance or code of any Governmental Entity, including any
judicial or administrative interpretation thereof,
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including, without limitation, any of the same related to the
protection of the environment applicable to the properties, facilities
or operations of the Company.
(k) "LIABILITIES" shall mean any and all debts, liabilities and
obligations (including all guarantees of indebtedness) of any nature
whatsoever, whether known or unknown, matured or unmatured, accrued or
fixed, absolute or contingent, determined, determinable or otherwise,
including those arising under any Law, those arising under any
contract, agreement, commitment, instrument, permit, license,
franchise or undertaking and those arising as a result of any act or
omission.
(l) "LIEN" shall mean with respect to any property or asset, any
mortgage, deed of trust, lien, pledge, guarantee, charge, security
interest, restriction, option, right of first refusal, right of first
offer, tag-along right, drag-along right, other adverse claim of any
kind, or other encumbrance of any nature (whether or not relating to
the extension of credit or borrowing of money) in respect of such
property or asset, including any conditional sale or other title
retention agreement relating to such property or asset, and any
financing lease having substantially the same economic effect as any
of the foregoing in respect of such property or asset or the income
therefrom.
(m) "MATERIAL CONTRACT" shall mean those agreements, contracts,
instruments or arrangements (as applicable) that involve payments or
expenditures by or to HIH, or otherwise have a value, of at least
$10,000,000.
(n) "ORDER" shall mean any award, judgment, injunction, consent,
ruling, decree, or order (whether temporary, preliminary or permanent)
issued, adopted, granted, awarded or entered by any Governmental
Entity.
(o) "PERSON" shall mean an individual, corporation, partnership,
limited liability company, joint venture, association, trust,
unincorporated organization or other entity.
(p) "SECURITIES ACT" means the Securities Act of 1933, as
amended.
(q) "TRANSACTION DOCUMENTS" shall mean (i) the B Note Covenant
Side Letter dated as of an even date as the date hereof, between HC
and the GOF Parties, (ii) the Private Sale Letter Agreement dated as
of an even date as the date hereof (the "Private Sale Letter"),
between HIH and the GOF Parties, and (iii) this Representation and
Indemnity Agreement and all other agreements, instruments and
documents executed by HIH or a Company Subsidiary pursuant to such
agreements.
(r) "UNITS" shall have the meaning set forth in the Second
Amended and Restated Limited Liability Company Agreement of HIH dated
as of December 20, 2001.
(s) "WHOLLY OWNED COMPANY SUBSIDIARY" shall mean a Company
Subsidiary in which HIH owns, either directly or indirectly, all: (i)
outstanding interests or shares of capital stock, as the case may be,
other than director qualifying shares, (ii) options (whether vested or
unvested) warrants, rights, calls, commitments or agreements of any
character to which such Company Subsidiary is a party or by which it
is bound calling for
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the issuance of interests or shares of capital stock, as the case may
be, of such Company Subsidiary, and (iii) securities convertible into
or exercisable or exchangeable for, or representing the right to
purchase or otherwise receive, directly or indirectly, any such
capital stock.
2 REPRESENTATIONS AND WARRANTIES OF HIH AND THE COMPANY SUBSIDIARIES.
HIH represents and warrants, as of the date hereof, to the GOF Parties that:
(a) ORGANIZATION, STANDING AND POWER OF HIH. HIH is a limited
liability company, duly organized, validly existing and in good
standing under the Laws of the State of Delaware and has all of the
requisite power, authority and all necessary government approvals or
licenses to own, lease, operate its properties, and to carry on its
business as now being conducted, except where failure to be so
organized, existing and in good standing or to have such power,
authority and approvals would not, either individually or in the
aggregate, have a Company Material Adverse Effect. HIH is duly
qualified or licensed to do business and is in good standing in each
jurisdiction in which the nature of the business it is conducting makes
such qualification or licensing necessary, other than in such
jurisdictions where the failure to be so qualified or licensed and in
good standing, individually or in the aggregate, would not constitute a
Company Material Adverse Effect. HIH has heretofore made available to
the GOF Parties complete and correct copies of HIH's Limited Liability
Company Agreement, as amended through the date hereof (the "LLC
AGREEMENT"). The LLC Agreement is in full force and effect as of the
date hereof.
(b) THE COMPANY SUBSIDIARIES; INTERESTS IN OTHER PERSONS.
(i) Each Company Subsidiary is duly organized, validly
existing and in good standing under the Laws of its jurisdiction
of incorporation and has all of the requisite power and authority
and all necessary government approvals and licenses to own,
lease, operate its properties, and to carry on its business as
now being conducted, except where the failure to have such
approvals or licenses would not, individually or in the
aggregate, constitute a Company Material Adverse Effect. Each
Company Subsidiary is duly qualified or licensed to do business
and is in good standing in each jurisdiction in which the nature
of the business it is conducting makes such qualification or
licensing necessary, other than in such jurisdictions where the
failure to be so qualified or licensed and in good standing would
not, individually or in the aggregate, constitute a Company
Material Adverse Effect. Section 2(b)(i) of the Company
Disclosure Letter sets forth a list of each Company Subsidiary.
All equity securities of each Company Subsidiary have been duly
authorized, are validly issued, fully paid and nonassessable and,
except as disclosed in Section 2(b)(i) of the Company Disclosure
Letter, are owned by HIH and/or one or more Wholly Owned Company
Subsidiaries, and are so owned free and clear of all Liens, and
there are no voting restrictions with respect to such equity
securities. Section 2(b)(i) of the Company Disclosure Letter sets
forth the amount and holder of all director qualifying shares
issued by Company Subsidiaries.
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(ii) HIH has heretofore made available to the GOF Parties
(if so requested) complete and correct copies of the charter,
by-laws or other organizational documents (the "CONSTITUTIVE
DOCUMENTS") of HIH and each of the Company Subsidiaries, each as
amended to the date hereof and each as in full force and effect.
Section 2(b)(ii) of the Company Disclosure Letter sets forth with
respect to each Company Subsidiary which is not a Wholly Owned
Company Subsidiary, each owner and the respective amount of such
owner's equity ownership in each such Company Subsidiary which is
not a Wholly Owned Subsidiary, including, without limitation,
securities convertible into or exercisable or exchangeable for
equity ownership in such Company Subsidiary.
(iii) Except for the stock of, or other equity interests in,
the Company Subsidiaries, and the other interests disclosed in
Section 2(b)(iii) of the Company Disclosure Letter (the
"COMPANY'S OTHER INTERESTS"), neither HIH nor any of the Company
Subsidiaries directly or indirectly owns any stock or other
ownership or equity interest in, or any interest convertible into
or exchangeable or exercisable for, any Person.
(c) HIH CAPITAL STRUCTURE.
(i) The total outstanding membership interests of HIH
consist of 1000 Units (the "UNITS"), all of which are validly
issued and outstanding, fully paid and non-assessable and were
not issued in violation of preemptive rights and, except as set
forth in Section 2(c) of the Company Disclosure Letter, no
outstanding Units are subject to forfeiture or repurchase for any
reason. Section 2(c) of the Company Disclosure Letter sets forth
a true and complete list of the holders of Units of HIH, the
class or series of such Units and the number of such Units owned
of record by each such holder.
(ii) Except as set forth in Section 2(c) of the Company
Disclosure Letter, there are no voting trusts, voting agreements,
proxies, first refusal rights, first offer rights, co-sale
rights, options, transfer restrictions or other agreements,
instruments or understandings (whether written or oral, formal or
informal) with respect to the voting, transfer or disposition of
Units or other equity securities of HIH or any of the Company
Subsidiaries to which HIH, the Company Subsidiaries or HSCC is a
party or by which they are bound, or, to the Knowledge of HIH,
among or between any Persons other than HIH or HSCC. Except as
set forth in Section 2(c) of the Company Disclosure Letter, there
are no options, warrants, rights, calls, commitments or
agreements of any character to which HIH or any Company
Subsidiary is a party, or by which HIH or any Company Subsidiary
is bound, calling for the issuance of Units or other equity
securities of HIH or any Company Subsidiary or any securities
convertible into or exercisable or exchangeable for, or
representing the right to purchase or otherwise receive, any such
membership interests or other equity securities, or other
arrangement to acquire, at any time or under any circumstance,
capital stock of HIH or any Company Subsidiary or any such other
securities. Except as set forth in Section 2(c) of the Company
Disclosure Letter, there are no obligations, contingent or
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otherwise, of HIH or any Company Subsidiary to purchase, redeem
or otherwise acquire any capital stock of any Company Subsidiary
or to provide funds or make an investment (in the form of a loan,
capital contribution or otherwise) in any such Company Subsidiary
or any other entity. Except as set forth in Section 2(c) of the
Company Disclosure Letter, no holder of securities in HIH or any
Company Subsidiary has any contractual right to have such
securities registered by HIH or any Company Subsidiary, as the
case may be. All prior issuances of securities by HIH and each of
the Company Subsidiaries were made in compliance with and not in
violation of all applicable Federal, state, local and foreign
securities laws.
(d) AUTHORITY; NO VIOLATIONS; CONSENTS AND APPROVAL.
(i) HIH has all requisite power and authority to enter into
the Transaction Documents to which it is a party and to
consummate the transactions contemplated hereby and thereby. The
execution and delivery of the Transaction Documents to which it
is a party and the consummation of the transactions contemplated
hereby or thereby have been duly and validly authorized by all
necessary action on the part of HIH. Such Transaction Documents
have been duly and validly executed and delivered by HIH and
constitute legal, valid and binding obligations of HIH,
enforceable against HIH in accordance with their terms, except to
the extent that enforceability may be limited by applicable
bankruptcy, reorganization, insolvency, moratorium or other
similar laws affecting the enforcement of creditors' rights
generally and by principles of equity regardless of whether such
enforceability is considered a proceeding in law or equity.
(ii) Except as set forth in Section 2(d)(ii) of the Company
Disclosure Letter, the execution, delivery and performance of the
Transaction Documents to which it is a party by HIH, the purchase
of the B Notes pursuant to the Purchase Agreement (and any
related documents including, but not limited to, the pledge
agreement) by the parties thereto, and the consummation of the
transactions with respect to the B Notes contemplated hereby and
thereby, and compliance by HIH with such provisions hereof and
thereof, will not conflict with, or result in any violation of,
or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancellation or
acceleration of any obligation, or the loss of a benefit under,
or give rise to a right of purchase under, result in the creation
of any Lien upon any of the properties or assets of HIH or any of
the Company Subsidiaries under, require the consent or approval
of any third party or otherwise result in a detriment or default
to HIH or any of the Company Subsidiaries under, any provision of
(A) the LLC Agreement or any Constitutive Document of HIH or any
Company Subsidiary, (B) any loan or credit agreement or note or
any bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise or license applicable
to HIH or any of the Company Subsidiaries, or to which their
respective properties or assets are bound or any guarantee by HIH
or any of the Company Subsidiaries of any of the foregoing, (C)
any joint venture or other ownership arrangement or any Material
Contract or (D) assuming the consents, approvals, authorizations
or permits and filings or
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notifications referred to in Section 2(d)(iii) are duly and
timely obtained or made, any Law or Order applicable to or
binding upon HIH or any of the Company Subsidiaries, or any of
their respective properties or assets, other than, in the case of
clauses (B), (C) and (D), any such conflicts, violations,
defaults, rights, Liens or detriments that, individually or in
the aggregate, would not constitute a Company Material Adverse
Effect.
(iii) Except as set forth in Section 2(d)(iii) of the
Company Disclosure Letter, no consent, approval, order or
authorization of, or registration, declaration or filing with,
notice to or permit from, any Governmental Entity, is required by
or on behalf of HIH, or any of the Company Subsidiaries in
connection with the execution, delivery and performance of the
Transaction Documents by HIH to which it is a party, the purchase
of the B Notes pursuant to the Purchase Agreement (and any
related documents including, but not limited to, the pledge
agreement) by the parties thereto, or the consummation by HIH of
the transactions with respect to the B Notes contemplated hereby
or thereby, except for any such consent, approval, order,
authorization, registration, declaration, filing or permit that
the failure to obtain or make, individually or in the aggregate,
would not constitute a Company Material Adverse Effect.
(e) SEC DOCUMENTS.
(i) HIH and Huntsman International LLC ("HI"), a Delaware
limited liability company and wholly owned subsidiary of HIH,
have made available to the GOF Parties a true and complete copy
of each report and registration statement filed by HIH or HI with
the SEC since inception and prior to or on the date hereof (the
"COMPANY SEC DOCUMENTS"). HIH and HI have filed all of the
Company SEC Documents required to be filed by them pursuant to
the federal securities laws and the SEC rules and regulations
thereunder. As of their respective dates, each of the Company SEC
Documents complied in all material respects with the requirements
of the Securities Act or the Exchange Act, as the case may be,
and the rules and regulations of the SEC thereunder applicable to
such Company SEC Documents and none of the Company SEC Documents
contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances
under which they were made, not misleading, except to the extent
such statements have been modified or superseded by later Company
SEC Documents filed and publicly available prior to the date of
this Representation and Indemnity Agreement. Neither HIH nor HI
has any outstanding and unresolved comments from the SEC with
respect to any of the Company SEC Documents and, as of the date
hereof, neither HIH nor HI has received any notice of any pending
investigation of HIH by the SEC. HIH and HI have made available
to the GOF Parties copies of all Company SEC Documents that are
subject to any confidential treatment request by HIH or HI.
(ii) The consolidated financial statements of HIH (including
the notes thereto) included in the Company SEC Documents complied
as to form in all
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material respects with the applicable accounting requirements and
the published rules and regulations of the SEC with respect
thereto, were prepared in accordance with generally accepted
accounting principles ("GAAP") applied on a consistent basis
during the periods involved (except as may be indicated in the
notes thereto, or, in the case of the unaudited statements, as
permitted by the rules and regulations of the SEC) and fairly
presented (subject, in the case of the unaudited statements, to
normal, recurring adjustments, none of which are material), the
consolidated financial position of HIH and the Company
Subsidiaries, taken as a whole, as of the dates set forth
therein, and the consolidated statements of income and the
consolidated cash flows of HIH and the Company Subsidiaries,
taken as a whole, for the periods presented therein. No Company
Subsidiary other than HI is required to make any filing with the
SEC except for filings made by a Company Subsidiary solely due to
the fact that it is a guarantor of HI or HIH.
(iii) The Units are not registered under Section 12 of the
Exchange Act.
(f) ABSENCE OF CERTAIN CHANGES OR EVENTS.
(i) Except as disclosed in Section 2(f)(i) of the Company
Disclosure Letter, since March 31, 2002, HIH and the Company
Subsidiaries have conducted their business only in the ordinary
and usual course and in a manner consistent with past practice
and, since such date, there has not been (A) any change, event,
development or circumstance affecting the Company or any of the
Company Subsidiaries that, individually, or in the aggregate has
had a Company Material Adverse Effect, (B) any declaration,
setting aside or payment of any dividend or other distribution
(whether in cash, stock or property) with respect to any of HIH's
Units or other equity securities of HIH or any Company Subsidiary
other than intercompany dividends between or among Wholly Owned
Company Subsidiaries, (C) any amendment of any term of any
outstanding security of HIH or any Company Subsidiary, (D) any
repurchase, redemption or other acquisition by HIH or any Company
Subsidiary of any outstanding shares of stock or other securities
of, or other ownership interests in, HIH or any Company
Subsidiary which are held by a person or entity other than a
Wholly Owned Company Subsidiary, or (E) any split, combination or
reclassification of any of the Units or any issuance or the
authorization of any issuance of any securities in respect of, in
lieu of or in substitution for, or giving the right to acquire by
exchange or exercise, Units.
(ii) Except as disclosed in Section 2(f)(ii) of the Company
Disclosure Letter or in the Company SEC Documents, during the
period from March 31, 2002 to the date of this Representation and
Indemnity Agreement, there has not been any change by HIH or HI
in its accounting methods, principles or practices, or any
revaluation by HIH or HI of any of its assets, including, writing
down the value of inventory or writing off notes or accounts
receivable other than in the ordinary course of business.
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(g) COMPLIANCE WITH APPLICABLE LAWS. Except as disclosed in
Section 2(g) of the Company Disclosure Letter, HIH and the Company
Subsidiaries hold all permits, licenses, certificates, registrations,
variances, exemptions, orders, franchises and approvals of all
Governmental Entities necessary or required by any applicable Law or
Order for the lawful conduct of their respective businesses (together
with any permits relating to the protection of the environment
applicable to the properties, facilities or operations of the Company,
the "COMPANY PERMITS"), except where the failure so to hold,
individually or in the aggregate, does not and would not constitute a
Company Material Adverse Effect. Except as disclosed in Section 2(g)
of the Company Disclosure Letter, HIH and the Company Subsidiaries are
in compliance with the terms of the Company Permits, except where the
failure to so comply, individually or in the aggregate, does not and
would not constitute a Company Material Adverse Effect. Except as
disclosed in Section 2(g) of the Company Disclosure Letter and except
as would not constitute a Company Material Adverse Effect, the
businesses of HIH and the Company Subsidiaries are not being conducted
in violation of any Law or Order. Except as disclosed in Section 2(g)
of the Company Disclosure Letter, no investigation or review by any
Governmental Entity with respect to HIH or any of the Company
Subsidiaries is pending or, to the Knowledge of HIH, is threatened,
other than those the outcome of which, individually or in the
aggregate, would not constitute a Company Material Adverse Effect.
(h) LITIGATION. Except as set forth in Section 2(h) of the
Company Disclosure Letter, there are no claims, actions, suits or
proceedings or, to the Knowledge of HIH, investigations, pending on
behalf of or pending against or, and to the Knowledge of HIH, no
claims, actions, suits, proceedings or investigations, threatened
against HIH or any Company Subsidiary or any of their respective
properties, assets or rights before any court, arbitrator or
administrative, governmental or regulatory authority or body, domestic
or foreign, except for such claims, actions, suits, proceedings or
investigations that would not, if adversely determined, have or be
reasonably expected to have, individually and in the aggregate, a
Company Material Adverse Effect. Neither HIH nor any Company
Subsidiary is subject to any outstanding order, writ, injunction or
decree which, individually or in the aggregate has, or which, insofar
as reasonably can be foreseen, in the future would have a Company
Material Adverse Effect or would prevent HIH or any Company Subsidiary
from consummating the transactions contemplated by the Transaction
Documents or impairing the ability of HIH to perform its obligations
hereunder and thereunder.
(i) RELATED PARTY TRANSACTIONS.
Except for compensation and benefits received in the ordinary course of
business as an employee or director of the Company or as described in
the Company SEC Documents or as set forth in Section 2(i) of the
Company Disclosure Letter, there are no material arrangements,
agreements or contracts entered into by HIH or any of the Company
Subsidiaries, on the one hand, and (i) Xxx Xxxxxxxx, (ii) a relative of
Xxx Xxxxxxxx, (iii) any Person who is an executive officer or director
of HC or to HIH's Knowledge, any executive officer, manager or director
of a Company Subsidiary, any relative of the foregoing or an entity of
which any of the foregoing individuals is an Affiliate or an
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Associate, and (iv) any manager of HIH, on the other hand. Copies of
all such documents have been made available to the GOF Parties.
(j) LIST OF AGREEMENTS WITH ICI. Set forth in Section 2(k) of
the Company Disclosure Letter is a list of all material agreements,
arrangements, commitments or understandings, whether oral or in
writing, of any nature, between or among: (i) the ICI Parent and/or
its subsidiaries and/or Affiliates; and (ii) Huntsman Corporation
and/or its subsidiaries and/or Affiliates (collectively, the "ICI
AGREEMENTS"), other than agreements, arrangements, commitments or
understandings which are (i) set forth in the Company SEC Documents or
(ii) operational in nature and entered into in the ordinary course of
business on terms that are no less favorable than those that might
reasonably have been obtained in a comparable transaction at such time
on an arm's length basis.
(k) FULL DISCLOSURE. Neither this Representation and Indemnity
Agreement, nor the Company Disclosure Letter contains any untrue
statement of a material fact or omits a material fact necessary to
make the statements contained herein and therein, in light of the
circumstances in which they were made, not misleading.
3 SURVIVAL. The representations, warranties, covenants and agreements made
herein shall survive the execution of the Transaction Documents and the
transactions contemplated hereby and thereby until the second anniversary of the
date hereof. Notwithstanding anything contained herein to the contrary, a claim,
demand, suit or cause of action otherwise available to the Indemnified Person
based upon an allegation or allegations that HIH or any of its Affiliates
committed fraud or made a willful, knowing or intentional misrepresentation in
connection with this Letter Agreement or any of the transactions contemplated
hereby shall survive until the application of any applicable statute of
limitations.
4 INDEMNIFICATION.
(a) Generally. HIH shall indemnify the GOF Parties, their successors
and assigns, and the respective officers, directors and managers of each of
the foregoing (the "INDEMNIFIED PERSONS") from and against any and all
losses, claims, shortages, damages, liabilities, expenses (including
reasonable attorneys' and accountants' fees), assessments, taxes (including
interest or penalties thereon) sustained, suffered or incurred by any
Indemnified Person arising from or in connection with any breach of any
representation or warranty contained herein (subject to Section 4(e)
hereof) or in the Private Sale Letter, or the breach of any agreement or
covenant of the Company contained herein or in the Private Sale Letter
("LOSSES").
(b) Assertion of Claims. No claim shall be brought hereunder unless
the Indemnified Persons, or any of them, give HIH (a) written notice of the
existence of any such claim, specifying the nature and basis of such claim
and the amount thereof, to the extent known, and the nature of the
misrepresentation, breach or claim to which such claim is related or (b)
written notice pursuant to Section 4(c) hereof of any third party claim,
the existence of which might give rise to such a claim, specifying the
nature and basis of such claim and the amount thereof, to the extent known,
and the nature of the misrepresentation, breach or claim to which such
claim is related, but the failure so to
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provide either such notice to HIH will not relieve HIH from any liability
which it may have to the Indemnified Persons under this Agreement or
otherwise (unless and only to the extent that such failure results in the
loss or compromise of any rights or defenses of HIH and it was not
otherwise aware of such action or claim). Upon the giving of such written
notice as aforesaid, the Indemnified Persons, or any of them, shall have
the right to commence legal proceedings for the enforcement of their rights
hereunder.
(c) Notice and Defense of Third Party Claims. Losses resulting from
the assertion of liability by third parties (each, a "THIRD PARTY CLAIM")
shall be subject to the following terms and conditions:
(i) The Indemnified Persons shall promptly give
written notice to HIH of any Third Party Claim that might give
rise to any Loss by the Indemnified Persons, stating the
nature and basis of such Third Party Claim, and the amount
thereof to the extent known, and the nature of the
misrepresentation, breach or claim to which such claim is
related. Such notice shall be accompanied by copies of all
relevant documentation with respect to such Third Party Claim,
including, without limitation, any summons, complaint or other
pleading that may have been served, any written demand or any
other document or instrument. Notwithstanding the foregoing,
the failure to provide notice as aforesaid to HIH will not
relieve HIH from any liability which it may have to the
Indemnified Persons under this Agreement or otherwise (unless
and only to the extent that such failure results in the loss
or compromise of any rights or defenses of HIH and it was not
otherwise aware of such action or claim).
(ii) HIH shall be entitled to participate in the
defense of any Third Party Claim and, subject to the
limitations set forth in this Section 4(c), shall be entitled
to control and appoint lead counsel for such defense, in each
case at its expense.
(iii) If HIH shall assume the control of the defense
of any Third Party Claim in accordance with the provisions of
this Section 4(c), HIH shall obtain the prior written consent
of the Indemnified Persons (which shall not be unreasonably
withheld or delayed) before entering into any settlement of
such Third Party Claim, if the settlement does not release the
Indemnified Persons from all liabilities and obligations with
respect to such Third Party Claim or the settlement imposes
injunctive or other equitable relief against the Indemnified
Persons and the Indemnified Persons shall be entitled to
participate in the defense of such Third Party Claim and to
employ separate counsel of its choice for such purpose. The
fees and expenses of such separate counsel shall be paid by
the Indemnified Persons.
(iv) Each party shall cooperate, and cause their
respective Affiliates to cooperate, in the defense or
prosecution of any Third Party Claim and shall furnish or
cause to be furnished such records, information and testimony,
and attend such conferences, discovery proceedings, hearings,
trials or appeals, as may be reasonably requested in
connection therewith.
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(d) HIH shall not be obligated to indemnify the Indemnified Persons
until such time as the aggregate Losses incurred or sustained by the
Indemnified Persons exceed $10,000,000 and then the Indemnified Persons
will only be entitled to indemnification with respect to that portion of
its damages which exceeds $10,000,000. Notwithstanding anything contained
herein to the contrary, the maximum aggregate liability of HIH for Damages
under this Section 4 shall not exceed aggregate amount of consideration
paid by the GOF Parties or their successors and assignees for the B Notes
under the Purchase Agreement.
(e) Notwithstanding anything contained in this Section 4 to the
contrary, a breach of representation or warranty by HIH or any of the
Company Subsidiaries under Section 2 hereof shall be deemed not to have
occurred if Xxxxx Xxxxxx and/or Xxxxx Xxxxxxx had actual and specific
knowledge of the fact that would have otherwise resulted in such breach by
virtue of prior express disclosure of such fact by HIH, and that a
reasonable person with knowledge of such fact would, in light of the manner
and circumstance in which such fact was so disclosed, understand that such
fact would result in a breach of such representation or warranty. HIH shall
have the burden of proof in determining the existence of such knowledge.
5 NOTICES. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered personally
or sent by internationally-recognized overnight courier or by telecopier
(followed within 2 business days by overnight delivery), with confirmation as
provided above addressed as follows:
IF TO GOF, to:
CSFB Global Opportunities Partners, L.P.
Eleven Madison Avenue, 16th Floor
New York, New York 10010
Attn: Xxxxx Xxxxxx
IF TO BNAC, to:
BNAC, Inc.
c/o CSFB Global Opportunities Partners, L.P.
Eleven Madison Avenue, 16th Floor
New York, New York 10010
Attn: Xxxxx Xxxxxx
IF TO HIH, to:
Huntsman International Holdings LLC
000 Xxxxxxxx Xxx
Xxxx Xxxx Xxxx
Xxxx 00000, XXX
Attn: General Counsel
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All such notices or communications shall be deemed to be received (a) in
the case of personal delivery, on the date of such delivery, (b) in the case of
internationally-recognized overnight courier, on the date of such delivery, (c)
in the case of transmission by telecopier upon confirmed receipt.
6 HIH AMENDMENTS AND WAIVERS. Any provision of this Representation and
Indemnity Agreement may be amended or waived if, but only if, such amendment or
waiver is in writing and is signed, in the case of an amendment, by each party
to this Representation and Indemnity Agreement, or in the case of a waiver, by
the party against whom the waiver is to be effective. No failure or delay by any
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by law.
8 SUCCESSORS AND ASSIGNS. The provisions of this Representation and Indemnity
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns; PROVIDED, HOWEVER, that HIH may not
assign, delegate or otherwise transfer any of its rights or obligations under
this Representation and Indemnity Agreement without the written consent of the
GOF Parties. Notwithstanding anything contained herein to the contrary, the GOF
Parties may not assign, delegate or otherwise transfer any of its rights or
obligations under this Representation and Indemnity Agreement to ICI Parent or
an Affiliate thereof without the written consent of HIH.
9 GOVERNING LAW. This agreement shall be governed in all respects by the laws
of the Sate of Delaware without regard to any conflicts of laws principles.
10 JURISDICTION. The parties hereto irrevocably and unconditionally submit to
the exclusive jurisdiction of any state or federal court located in the State of
Delaware, and any appellate court with jurisdiction to review decisions of any
such court, in any action or proceeding brought by any of the parties hereto
arising out of or relating to this Representation and Indemnity Agreement, and
each of the parties hereto irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in any such court. Each of the parties hereby irrevocably waives, to the fullest
extent permitted by law, any objection that it may now or hereafter have to the
laying of the venue of any such suit, action or proceeding in any such court or
that any such suit, action or proceeding brought in any such court has been
brought in an inconvenient forum. Process in any such suit, action or proceeding
may be served on any party anywhere in the world, whether within or without the
jurisdiction of any such court. Without limiting the foregoing, each party
agrees that service of process on such party in the manner provided for notices
in Delaware or by certified U.S. mail, return receipt requested, shall be deemed
effective service of process on such party in respect of proceedings in
Delaware. Notwithstanding the foregoing, nothing in this Representation and
Indemnity Agreement shall affect any right that any of the parties may have to
(i) bring any action or proceeding relating to this Representation and Indemnity
Agreement in any court that has jurisdiction by reason of a case pending under
Title 11 of the U.S. Code or (ii) seek recognition or enforcement of any
judgment in other jurisdictions by suit on the judgment or in the manner
provided by law.
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11 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
12 COUNTERPARTS; NO THIRD PARTY BENEFICIARIES. This Representation and
Indemnity Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument. This Representation and Indemnity
Agreement shall become effective when each party hereto shall have received a
counterpart hereof signed by the other party hereto. No provision of this
Representation and Indemnity Agreement is intended to confer upon any Person
other than the parties hereto any rights or remedies under this
Representation and Indemnity Agreement.
13 ENTIRE AGREEMENT. This Representation and Indemnity Agreement and the other
documents and instruments referred to herein constitute the entire agreement
among the parties hereto with respect to the subject matter of this
Representation and Indemnity Agreement.
14 SEVERABILITY. In the event that any provision of this Representation and
Indemnity Agreement becomes or is declared by a court of competent jurisdiction
to be illegal, unenforceable or void, this Representation and Indemnity
Agreement shall continue in full force and effect without said provision;
PROVIDED, HOWEVER, that no such severability shall be effective if it materially
changes the economic benefit of this Representation and Indemnity Agreement to
any party.
15 CAPTIONS. The captions herein are included for convenience of reference
only and shall be ignored in the construction or interpretation hereof.
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Sincerely,
HUNTSMAN INTERNATIONAL HOLDINGS LLC
By: /s/ Xxx Xxxxxxx
-------------------------
Name: Xxx Xxxxxxx
Title: Vice President
Agreed and accepted as of the date first written above:
CSFB GLOBAL OPPORTUNITIES PARTNERS, L.P.
By: CSFB GLOBAL OPPORTUNITIES ADVISERS, LLC,
AS ITS INVESTMENT ADVISOR
By: /s/ Xxxxx X. Xxxxxx
-------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
BNAC, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------
Name: Xxxxx X. Xxxxxx
Title: President
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