EXHIBIT 10.4
MASTER REPURCHASE AGREEMENT
AGREEMENT dated as of the 20th day of March, 1996 between Thermo
Electron Corporation, a Delaware corporation ("Seller"), and Thermedics
Detection Inc., a Massachusetts corporation (the "Buyer").
1. APPLICABILITY
From time to time Buyer and Seller may enter into transactions in which
Seller agrees to transfer to Buyer certain securities and/or financial
instruments ("Securities") against the transfer of funds by Buyer, with a
simultaneous agreement by Buyer to transfer to Seller such Securities on
demand, against the transfer of funds by Seller. Each such transaction shall
be referred to herein as a "Transaction" and shall be governed by this
Agreement, unless otherwise agreed in writing.
2. DEFINITIONS
(a) "Act of Insolvency", with respect to either party (i) the
commencement by such party as debtor of any case or proceeding under any
bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law,
or such party seeking the appointment of a receiver, trustee, custodian or
similar official for such party or any substantial part of its property; or (ii)
the commencement of any such case or proceeding against such party, or another
seeking such an appointment, which (A) is consented to or not timely contested
by such party, (B) results in the entry of an order for relief, such an
appointment or the entry of an order having a similar effect, or (C) is not
dismissed within 15 days; or (iii) the making by a party of a general assignment
for the benefit of creditors; or (iv) the admission in writing by a party of
such party's inability to pay such party's debts as they become due;
(b) "Additional Purchased Securities", Securities provided by Seller
to Buyer pursuant to Paragraph 4(a) hereof;
(c) "Income", with respect to any Security at any time, any
principal thereof then payable and all interest, dividends or other
distributions thereon;
(d) "Market Value", with respect to any Securities as of any date,
the price for such Securities on such date obtained from a generally recognized
source agreed to by the parties or the most recent closing bid quotation from
such a source, plus accrued Income to the extent not included therein (other
than any Income transferred to Seller pursuant to Paragraph 6 hereof) as of such
date (unless contrary to market practice for such Securities);
(e) "Other Buyers", third parties that have entered into an
agreement with Seller that is substantially similar to this Agreement;
(f) "Pricing Rate", a rate equal to the Commercial Paper Composite
rate for 30-day maturities provided by Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (or, if such rate is not available, a substantially equivalent rate
agreed to by Buyer and Seller) plus 25 basis points, which rate shall be
adjusted on the first business day of each fiscal quarter and shall be in effect
for the entirety such fiscal quarter;
(g) "Purchase Price", the price at which Purchased Securities are
transferred by Seller to Buyer;
(h) "Purchased Securities", the Securities transferred by Seller to
Buyer in a Transaction hereunder, and any Securities substituted therefor in
accordance with Paragraph 9 hereof. The term "Purchased Securities" with respect
to any Transaction at any time also shall include Additional Purchase Securities
transferred pursuant to Paragraph 4(a) and shall exclude Securities returned
pursuant to Paragraph 4(b);
(i) "Repurchase Collateral Account", a book account maintained by
Seller containing, among other Securities, the Purchased Securities; and
(j) "Repurchase Price", for any Purchased Security, an amount equal
to the Purchase Price paid by Buyer to Seller for such Purchased Security.
3. TRANSACTIONS
(a) A Transaction may be initiated by Buyer upon the transfer of the
Purchase Price to Seller's account. Upon such transfer, Seller shall transfer
to Buyer Purchased Securities having a Market Value equal to 103% of the
Purchase Price.
(b) Purchased Securities shall be held in custody for Buyer by
Seller in the Repurchase Collateral Account. Seller shall indicate on its books
for such account Buyer's ownership of the Purchased Securities. Upon reasonable
request from Buyer, Seller shall provide Buyer with a complete list of Purchased
Securities owned by Buyer.
(c) Upon demand by Buyer or Seller, Seller shall repurchase from
Buyer, and Buyer shall sell to Seller, for the Repurchase Price all or any part
of the Purchased Securities then owned by Buyer.
4. MARGIN MAINTENANCE
(a) If at any time the aggregate Market Value of all Purchased
Securities then owned by Buyer is less than 103% of the aggregate Repurchase
Price for such Purchased Securities, then Seller shall transfer to Buyer
additional Securities ("Additional Purchased Securities"), so that the aggregate
Market Value of such Purchased Securities, including any such Additional
Purchased Securities, will thereupon equal or exceed 103% of such aggregate
Repurchase Price.
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(b) If at any time the aggregate Market Value of all Purchased
Securities then owned by Buyer exceeds 103% of the aggregate Repurchase Price
for such Purchased Securities, then Seller may transfer Purchased Securities to
Seller, so that the aggregate Market Value of such Purchased Securities will
thereupon not exceed 103% of such aggregate Repurchase Price.
5. INTEREST PAYMENTS
If during any fiscal month Buyer owned Purchased Securities, then on the
first day of the next following fiscal month Seller shall pay to Buyer an
amount equal to the sum of the aggregate Repurchase Prices of the Purchased
Securities owned by Buyer at the close of each day during the preceding fiscal
month divided by the number of days in such month and the product multiplied by
the Pricing Rate times the number of days in such month divided by 360.
6. INCOME PAYMENTS AND VOTING RIGHTS
Where a particular Transaction's term extends over an Income payment
date on the Purchased Securities subject to that Transaction, Buyer shall, on
the date such Income is payable, transfer to Seller an amount equal to such
Income payment or payments with respect to any Purchased Securities subject to
such Transaction. Seller shall retain all voting rights with respect to
Purchased Securities sold to Buyer under this Agreement.
7. SECURITY INTEREST
Although the parties intend that all Transactions hereunder be sales and
purchases and not loans, in the event any such Transactions are deemed to be
loans, Seller shall be deemed to have pledged to Buyer as security for the
performance by Seller of its obligations under each such Transaction and this
Agreement, and shall be deemed to have granted to Buyer a security interest in,
all of the Purchased Securities with respect to all Transactions hereunder and
all proceeds thereof.
8. PAYMENT AND TRANSFER
Unless otherwise mutually agreed, all transfers of funds hereunder shall
be in immediately available funds. As used herein with respect to Securities,
"transfer" is intended to have the same meaning as when used in Section 8-313 of
the Massachusetts Uniform Commercial Code or, where applicable, in any federal
regulation governing transfers of the Securities.
9. SUBSTITUTION
Buyer hereby grants Seller the authority to manage, in Seller's sole
discretion, the Purchased Securities held in custody for Buyer by Seller in the
Repurchase Collateral Account. Buyer expressly agrees that Seller may (i)
substitute other Securities for any Purchased Securities and (ii) commingle
Purchased Securities with other Securities held in the Repurchase Collateral
Account. Substitutions shall be made by transfer to Buyer of such other
Securities and transfer to Seller of the Purchased Securities for which
substitution is being made. After substitution, the
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substituted Securities shall be deemed to be Purchased Securities. Securities
which are substituted for Purchased Securities shall have a Market Value at the
time of substitution equal to or greater than the Market Value of the Purchase
Securities for which such Securities were substituted.
10. REPRESENTATIONS
Each of Buyer and Seller represents and warrants to the other that (i)
it is duly authorized to execute and deliver this Agreement, to enter into the
Transactions contemplated hereunder and to perform its obligations hereunder and
has taken all necessary action to authorize such execution, delivery and
performance, (ii) the person signing this Agreement on its behalf is duly
authorized to do so on its behalf, (iii) it has obtained all authorizations of
any governmental body required in connection with this Agreement and the
Transactions hereunder and such authorizations are in full force and effect and
(iv) the execution, delivery and performance of this Agreement and the
Transactions hereunder will not violate any law, ordinance, charter, by-law or
rule applicable to it or any agreement by which it is bound or by which any of
its assets are affected. On the date for any Transaction Buyer and Seller shall
each be deemed to repeat all the foregoing representations made by it.
11. EVENTS OF DEFAULT
In the event that (i) Seller fails to repurchase or Buyer fails to
transfer Purchased Securities upon demand for repurchase from either Buyer or
Seller, (ii) Seller or Buyer fails, after one business day's notice, to comply
with Paragraph 4 hereof, (iii) Buyer fails to make payment to Seller pursuant to
Paragraph 6 hereof, (iv) Seller fails to comply with Paragraph 5 hereof, (v) an
Act of Insolvency occurs with respect to Seller or Buyer, (vi) any
representation made by Seller or Buyer shall have been incorrect or untrue in
any material respect when made or repeated or deemed to have been made or
repeated, or (vii) Seller or Buyer shall admit to the other its inability to, or
its intention not to, perform any of its obligations hereunder (each an "Event
of Default"):
(a) At the option of the nondefaulting party, exercised by written
notice to the defaulting party (which option shall be deemed to have been
exercised, even if no notice is given, immediately upon the occurrence of any
Act of Insolvency), Seller shall become obligated to repurchase, and Buyer shall
become obligated to sell, all Purchased Securities then owned by Buyer for the
Repurchase Price of such Purchased Securities.
(b) If Seller is the defaulting party and Buyer exercises or is
deemed to have exercised the option referred to in subparagraph (a) of this
Paragraph, (i) the Seller's obligations hereunder to repurchase all Purchased
Securities in such Transactions shall thereupon become immediately due and
payable, (ii) all Income paid after such exercise or deemed exercise shall be
retained by Buyer and applied to the aggregate unpaid Repurchase Prices owed by
Seller, and (iii) Seller shall immediately deliver to Buyer any Purchased
Securities subject to such Transactions then in Seller's possession.
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(c) In all Transactions in which Buyer is the defaulting party, upon
tender by Seller of payment of the aggregate Repurchase Prices for all such
Transactions, Buyer's right, title and interest in all Purchased Securities
subject to such Transactions shall be deemed transferred to Seller, and Buyer
shall deliver all such Purchased Securities to Seller.
(d) After one business day's notice to the defaulting party (which
notice need not be given if an Act of Insolvency shall have occurred, and which
may be the notice given under subparagraph (a) of this Paragraph or the notice
referred to in clause (ii) of the first sentence of this Paragraph), the
nondefaulting party may:
(i) as to Transactions in which Seller is the defaulting
party, (A) immediately sell, in a recognized market at such price or prices as
Buyer may reasonably deem satisfactory, any or all Purchased Securities subject
to such Transactions and apply the proceeds thereof to the aggregate unpaid
Repurchase Prices and any other amounts owing by Seller hereunder or (B) in its
sole discretion elect, in lieu of selling all or a portion of such Purchased
Securities, to give Seller credit for such Purchased Securities in an amount
equal to the price therefor on such date, obtained from a generally recognized
source or the most recent closing bid quotation from such a source, against the
aggregate unpaid Repurchase Prices and any other amounts owing by Seller
hereunder; and
(ii) as to Transactions in which Buyer is the defaulting
party, (A) purchase securities ("Replacement Securities") of the same class and
amount as any Purchased Securities that are not delivered by Buyer to Seller as
required hereunder or (B) in its sole discretion elect, in lieu of purchasing
Replacement Securities, to be deemed to have purchased Replacement Securities at
the price therefor on such date, obtained from a generally recognized source or
the most recent closing bid quotation from such a source.
(e) As to Transactions in which Buyer is the defaulting party,
Buyer shall be liable to Seller (i) with respect to Purchased Securities (other
than Additional Purchased Securities), for any excess of the price paid (or
deemed paid) by Seller for Replacement Securities therefor over the Repurchase
Price for such Purchased Securities and (ii) with respect to Additional
Purchased Securities, for the price paid (or deemed paid) by Seller for the
Replacement Securities therefor.
(f) The defaulting party shall be liable to the nondefaulting party
for the amount of all reasonable legal or other expenses incurred by the
nondefaulting party in connection with or as a consequence of an Event of
Default.
(g) The nondefaulting party shall have, in addition to its rights
hereunder, any rights otherwise available to it under any other agreement or
applicable law.
12. SINGLE AGREEMENT
Buyer and Seller acknowledge that, and have entered hereinto and will
enter into each Transaction hereunder in consideration of and in reliance upon
the fact that, all Transactions hereunder constitute a single business and
contractual relationship and have been made in
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consideration of each other. Accordingly, each of Buyer and Seller agrees (i) to
perform all of its obligations in respect of each Transaction hereunder, and
that a default in the performance of any such obligations shall constitute a
default by it in respect of all Transactions hereunder, (ii) that each of them
shall be entitled to set off claims and apply property held by them in respect
of any Transaction against obligations owing to them in respect of any other
Transactions hereunder and (iii) that payments, deliveries and other transfers
made by either of them in respect of any Transaction shall be deemed to have
been made in consideration of payments, deliveries and other transfers in
respect of any other Transactions hereunder, and the obligations to make any
such payments, deliveries and other transfers may be applied against each other
and netted.
13. ENTIRE AGREEMENT; SEVERABILITY
This Agreement shall supersede any existing agreements between the
parties containing general terms and conditions for repurchase transactions.
Each provision and agreement and agreement herein shall be treated as separate
and independent from any other provision or agreement herein and shall be
enforceable notwithstanding the unenforceability of any such other provision or
agreement.
14. NON-ASSIGNABILITY; TERMINATION
The rights and obligations of the parties under this Agreement and under
any Transactions shall not be assigned by either party without the prior
written consent of the other party. Subject to the foregoing, this Agreement
and any Transactions shall be binding upon and shall inure to the benefit of
the parties and their respective successors and assigns. This Agreement may be
canceled by either party upon giving written notice to the other, except that
this Agreement shall, notwithstanding such notice, remain applicable to any
Transactions then outstanding.
15. GOVERNING LAW
This Agreement shall be governed by the laws of the Commonwealth of
Massachusetts without giving effect to the conflict of law principles thereof.
16. NO WAIVERS, ETC.
No express or implied waiver of any Event of Default by either party
shall constitute a waiver of any other Event of Default and no exercise of any
remedy hereunder by any party shall constitute a wavier of its right to exercise
any other remedy hereunder. No modification or waiver of any provision of this
Agreement and no consent by any party to a departure herefrom shall be effective
unless and until such shall be in writing and duly executed by both of the
parties hereto.
19. INTENT
(a) The parties recognize that each Transaction is a "repurchase
agreement" as that term is defined in Section 101 of Title 11 of the United
States Code, as amended (except insofar
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as the type of Securities subject to such Transaction or the term of such
Transaction would render such definition inapplicable), and a "securities
contract" as that term is defined in Section 741 of Title 11 of the United
States Code, as amended.
(b) It is understood that either party's right to liquidate
Securities delivered to it in connection with Transactions hereunder or to
exercise any other remedies pursuant to Paragraph 11 hereof, is a contractual
right to liquidate such Transaction as described in Sections 555 and 559 of
Title 11 of the United States Code, as amended.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
THERMO ELECTRON CORPORATION THERMEDICS DETECTION INC.
By: /s/ Xxxx X. Xxxx Xx. By: /s/ Xxxxxxxx X. Xxxxxxx
(Signature) (Signature)
Xxxx X. Xxxx Xx. Xxxxxxxx X. Xxxxxxx
(Print Name) (Print Name)
Title: Senior Vice President Title: Treasurer
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