___ July 1997
FOAMEX ASIA, INC.
FOAMEX ASIA CO., LTD.
XXX XXX COMPANY LIMITED
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LOAN AGREEMENT
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FRESHFIELDS
THIS LOAN AGREEMENT is made on this day of July 1997.
BETWEEN:
a. FOAMEX ASIA, INC., a corporation organized and existing under the laws of
the State of Delaware, U.S.A., with its principal office and place of
business at 0000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxx 00000, X.X.X. ("the
Lender");
b. FOAMEX ASIA CO., LTD., a limited company established under the laws of the
Kingdom of Thailand having its registered office at 22nd Floor, Sathorn
City Tower, 000 Xxxxx Xxxxxxx Xxxx, Xxxx Xxxxxxx, Xxxxxxx, Xxxxxxxx (the
Borrower); and
c. XXX XXX COMPANY LIMITED, a limited company organized and existing under the
laws of the Kingdom of Thailand, with its registered office located at
000-000 Xxxxx Xxxx, Xxxxxx Xxxxxxx, Xxxx Xxxxxxxxxxxxxxxx, Xxxxxxx,
Xxxxxxxx ("HK").
WHEREAS:
A. The Lender and HK are parties to a Joint Venture Agreement relating to the
Borrower, a company established under the laws of Thailand to engage in the
manufacture of polyurethane polymer materials and the conversion of various
plastic foam materials and adhesive films and foils.
B. The Lender has agreed to lend the Borrower an amount of money denominated
in Baht to assist with the working capital requirements of the Borrower.
C. The parties, in entering into this Agreement, have agreed that the loan to,
and the repayment of such loan by, the Borrower shall be governed by the
terms of this Agreement.
IT IS XXXXXX AGREED AS FOLLOWS:
DEFINITIONS
1. In this Agreement, the following terms shall, unless the context otherwise
requires, have the following meanings:
"Agreement" means this loan agreement as it may be amended or supplemented in
writing by the parties from time to time;
"Baht" means the lawful currency of the Kingdom of Thailand;
"Business Day" means a day on which banks are officially open in Bangkok,
Thailand and New York, USA for the transaction of business of the nature
required by this Agreement;
"Drawdown Date" means the date on which the Borrower draws down the Loan Amount
in accordance with clause 4.1;
"Drawdown Notice" means a notice issued to the Lender by the Borrower in
accordance with clause 4.2(c), in the form of Annex A;
"Group B Shares" means Group B shares in the capital of the Borrower;
"Interest" means the amount of interest at the rate specified in clause 5 which
accrues on the Loan Amount from time to time;
"Joint Venture Agreement" means the joint venture agreement between the Lender
and HK dated 8 July 1997;
"Loan Amount" means the principal amount made available to the Borrower in
accordance with clause 2 by way of loan or (as the context requires) the
principal amount thereof for the time being outstanding;
"Option Agreement" means the option agreement as set out in Annex D between the
Lender and HK relating to two percent. (2%) of the issued share capital of the
Borrower owned by HK;
"Repayment Notice" means a notice issued to the Borrower by either the Lender or
HK in accordance with clause 6.2 and 6.3 respectively, in the form of Annex C;
"Subscription Amount" means the amount subscribed by the Lender for Group B
Shares in the Borrower, calculated as follows:
Baht 36,366,340 + Interest;
"Term" means the term of the loan set out in clause 3.
AMOUNT
2. The Lender agrees to lend to the Borrower the sum of Thirty Six Million Three
Hundred and Sixty Six Thousand Three Hundred and Forty Baht (Baht 36,366,340)
for working capital purposes. The Borrower shall drawdown the Loan Amount in
accordance with clause 4.
TERM
3. Unless otherwise agreed by the parties in writing, the Loan Amount shall be
repayable by the Borrower to the Lender in accordance with clause 6
no later than the date which falls thirty six (36) months after the Drawdown
Date.
DRAWDOWN
4.1 Timing of Drawdown
The Borrower shall drawdown the Loan Amount on 31 July 1997 or such later date
as the Lender and the Borrower may agree in writing.
4.2 Conditions
The Borrower shall drawdown the Loan Amount in accordance with the following
conditions:
(a) prior to the Drawdown Date, the Borrower shall deliver to the Lender a
certified copy of a resolution of the board of directors of the Borrower
approving and authorising the Borrower entering into and executing this
Agreement;
(b) at least three (3) Business Days prior to the Drawdown Date, the Borrower
shall deliver to the Lender a Drawdown Notice duly completed by the
Borrower;
(c) within five (5) Business Days of the Drawdown Date, the Borrower shall
deliver a receipt duly completed by the Borrower in the form of Annex B;
and
(d) the Borrower shall deliver such other documents or do such other things as
the Lender may reasonably require.
INTEREST
5. Interest on the Loan Amount at the rate of ten percent. (10%) per annum shall
be payable by the Borrower to the Lender. Interest shall be calculated monthly
in arrears on the 15th day of each month and shall be calculated on the basis of
actual days elapsed and a year of 365 days. Unless otherwise agreed by the
parties in writing and, subject to the provisions of the Thai Civil and
Commercial Code, the Interest shall be payable by the Borrower to the Lender
upon repayment of the Loan Amount in accordance with clause 6.4.
REPAYMENT
6.1 Repayment by Xxxxxxxx
At any time during the Term, the Borrower may, on giving not less than 30 days
written notice to the Lender, without penalty, repay the Loan Amount and the
Interest to the Lender in accordance with clause 6.4.
6.2 Notice by Xxxxxx
At any time during the Term, the Lender shall have the right to demand repayment
of the Loan Amount and payment of the Interest by giving a Repayment Notice to
the Borrower. Upon the Lender giving a Repayment Notice to the Borrower, the
Borrower shall repay the Loan Amount and the Interest to the Lender in
accordance with clause 6.4.
6.3 Notice by HK
At any time during the Term, HK shall have the right to require the Borrower to
repay the Loan Amount and the Interest to the Lender by giving a Repayment
Notice to the Borrower. Upon HK giving a Repayment Notice to the Borrower, the
Borrower shall repay the Loan Amount and the Interest to the Lender in
accordance with clause 6.4.
6.4 Repayment
Upon the first to occur of the following events:
(i) the Borrower giving the Lender notice under clause 6.1;
(ii) either the Lender or HK giving the Borrower a Repayment Notice under
clauses 6.1 or 6.2, respectively; or
(iii) the end of the Term,
the Borrower shall:
(i) at the end of the relevant notice period where clause 6.1 applies;
(ii) within ten (10) Business Days of the date of the Repayment Notice where
either clause 6.2 or 6.3 applies; or
(iii) within ten (10) Business Days of the end of the Term,
repay the Loan Amount and the Interest (less any withholding tax deducted in
accordance with clause 8) to an account at Siam Commercial Bank PCL in the name
of the Lender and subject to the joint mandate of the Lender and the Borrower,
or to such other account as the parties may agree. Upon payment of the Loan
Amount and the Interest (less any withholding tax deducted in accordance with
clause 8), the Borrower shall have fully discharged its obligations under this
Agreement.
SUBSCRIPTION FOR B GROUP SHARES
7.1 Subscription
Upon repayment of the Loan Amount and the Interest (less any withholding tax
deducted in accordance with clause 8) by the Borrower to the Lender pursuant to
clause 6.4, the Lender shall immediately transfer the Subscription Amount
from the bank account referred to in clause 6.4 to the account of the Borrower
as payment in full for the subscription for 3,636,634 Group B Shares in the
Borrower. The Lender and the Borrower shall complete and sign all withdrawal
slips or other documentation as may be required to effect the transfer of the
Subscription Amount to the account of the Borrower. Subscription for the Group B
Shares by the Lender shall be in accordance with the terms of the Joint Venture
Agreement.
7.2 Signing of Option Agreement
Upon completion of the subscription for Group B Shares by the Lender under
clause 7.1, the Lender and HK shall each sign the Option Agreement.
PAYMENTS
8. Any and all payments due to be made by the Borrower under this Agreement
shall be made in Baht currency before the close of business on the relevant
Business Day to an account at Siam Commercial Bank PCL in the name of the Lender
and subject to the joint mandate of the Lender and the Borrower, or to such
other account as the parties may agree. The Borrower shall deduct any
withholding tax payable at the appropriate rate and pay to the appropriate
authority all amounts withheld or deducted. If a receipt or other evidence of
payment can be issued, the Borrower agrees to deliver this to the Lender as soon
as possible. All payments made by the Borrower pursuant to this Agreement shall
be made without set-off or counterclaim.
REPRESENTATIONS AND WARRANTIES
9. The Borrower represents and warrants to the Lender that:
(a) it is duly incorporated and validly existing under the laws of Thailand and
has full power and authority to own and hold its assets and to carry on its
business;
(b) it has full power to execute and perform this Agreement, it has taken all
necessary action (corporate or otherwise) to authorise its borrowings
hereunder upon the terms of this Agreement and to authorise its execution
of and performance under this Agreement and the resolution of the board of
directors of the Borrower provided to the Lender under clause 4.2(a) is
true, correct and up to date, is in full force and effect and has not been
amended, modified or revoked;
(c) this Agreement constitutes ohe legal, valid and binding obligations of the
Borrower enforceable in accordance with its terms; and
(d) in any proceedings taken in relation to this Agreement, the Borrower will
not be entitled to claim for itself or any of its assets immunity from
suit, execution, attachment or other legal process.
On the Drawdown Date, the Borrower shall represent and warrant to the Lender,
with reference to the facts and circumstances then subsisting, that each of the
representations and warranties contained in this clause 9 remains true, accurate
and correct.
COSTS AND EXPENSES
10. The Lender and the Borrower shall each pay its own costs, charges and
expenses incurred in connection with the preparation and implementation of this
Agreement. Any stamp duty or other fees payable in connection with this
Agreement shall be borne by the Lender.
NOTICES
11.1 Any notice required to be given hereunder shall be in writing and in
English and shall be delivered or sent by prepaid registered mail or by hand
delivery to the address of the party to whom it is to be sent as set our below
(or such other addresses of which notice may be given) and any notice shall be
deemed to be given at the time of delivery. A facsimile notice shall be deemed
to be a proper notice in writing and shall be deemed to be duly given at the
time of receipt.
11.2 The details for notices are:
The Lender: Foamex Asia, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
U.S.A.
Fax: 0 000 000-0000
Attention: Chief Financial Officer
with copies to:
Name: Foamex International Inc.
Address: 11th Floor, 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000, XXX
Facsimile: 1 212 593 1363
Attention: Xxxxxx X. Xxxxx, Xx., Esq.
Vice President, General Counsel
Name: Xx. Xxxxxxx X. Xxxxxxxx, Xx
Address: La-Xxxx Tower Co., Ltd.
Apt. 15B
9 Sukhumvit Soi 33
Bangkok 10110
Facsimile: (000) 000 0000.
The Borrower: Foamex Asia Co., Ltd.
Address: 22nd Floor, Sathorn City Tower
000 Xxxxx Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxx
Facsimile: (000) 000-0000
Attention: The CEO and the President
HK: Xxx Xxx Company Limited
Address: c/o Polymers Marketing Company Limited
20th Floor, Sathorn City Tower
000 Xxxxx Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxx
Facsimile: (000) 000-0000
Attention: Xx. Xxxxxx Xxxxxxxxxx.
FURTHER ASSURANCES
12. The parties shall do or procure to be done all such further acts and things,
to execute or procure the execution of all such other documents, as may be
required, for the purpose of giving effect to this Agreement.
AMENDMENTS
13. This Agreement may be amended only by an instrument in writing signed by or
on behalf of each of the parties. No amendment to this Agreement which is
purported to have been made verbally shall be valid.
WAIVER
14. No failure on the part of a party to exercise, and no delay on its part in
exercising, any right or remedy under this Agreement will operate as a waiver
thereof, nor will any single or partial exercise of any right or remedy by a
party preclude any other or further exercise thereof or the exercise of any
other right or remedy by that party. The rights and remedies provided in this
Agreement are cumulative and not exclusive of any rights or remedies provided by
law.
ENTIRE AGREEMENT
15. This Agreement constitutes the entire agreement and understanding of the
parties in connection with the subject matter of the Agreement and supersedes
any and all prior agreements, understandings, arrangements, promises or
representations and warranties, if any, made prior to the date of this
Agreement.
INVALIDITY
16. If any of the provisions of this Agreement is or becomes invalid, illegal or
unenforceable, the validity, legality or enforceability of the remaining
provisions shall not in any way be affected or impaired. The parties shall
negotiate in good faith in order to agree the terms of a mutually satisfactory
provision, achieving as near as possible the same commercial effect, to be
substituted for the provision found to be void or unenforceable.
ASSIGNMENT
17. None of the parties shall be entitled to assign this Agreement or any of its
rights or obligations hereunder without the prior written consent of the other
parties.
GOVERNING LAW
18. This Agreement shall be governed by, and construed in accordance with, the
laws of the Kingdom of Thailand. Any dispute arising out of or in connection
with this Agreement shall be referred to the courts of Thailand.
AS WITNESS this Agreement has been executed the day and year first before
written.
FOAMEX ASIA, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
--------------------------------
Name: Xx. Xxxxxxx X. Xxxxxxxx, Xx.
Title: President
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Witness
(Mr. Xxxxxxx Xxxx)
FOAMEX ASIA CO., LTD.
By: /s/ Xx. Xxxxxx Xxxxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
------------------------- --------------------------------
Name: Xx. Xxxxxx Xxxxxxxxxx Name: Xx. Xxxxxxx X. Xxxxxxxx, Xx.
Title: Director Title: Director
[Seal]
--------------- ---------------
Witness Witness
(Mr. Xxxxxx Xxxxxxxx) (Mr. Xxxxxxx Xxxx)
XXX XXX COMPANY LIMITED
By: /s/ Xx. Xxxxxx Xxxxxxxxxx
-------------------------
Name: Xx. Xxxxxx Xxxxxxxxxx
Title: Director
[Seal]
---------------
Witness
(Mr. Xxxxxx Xxxxxxxx)
Annex A
[Foamex Asia Co., Ltd letterhead]
Drawdown Notice
Date _____ 1997
To: Foamex Asia, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000 U.S.A.
Attention: __________________
Facsimile: 1 212 593 1363
Dear Sirs,
Foamex Asia Co., Ltd., as the Borrower, hereby proposes in accordance with the
Loan Agreement dated _______ 1997 between the Lender, the Borrower and HK (the
"Loan Agreement") that the amount of Thirty Six Million Three Hundred and Sixty
Six Thousand Three Hundred and Forty Baht (Baht 36,366,340) under the Loan
Agreement be made to the Borrower on _______ 1997.
The Borrower hereby confirms that each of the representation and warranties
contained in clause 9 of the Loan Agreement is true and accurate in all respects
as though made on the date of this Notice with reference to facts and
circumstances presently subsisting and will be true and accurate in all respects
on the date of the intended drawdown as though made on the date of the intended
drawdown with reference to facts and circumstances then subsisting.
All terms used herein shall have the same meaning as ascribed to them in the
Loan Agreement.
Yours faithfully,
Foamex Asia Co., Ltd.
By: ______________ By: ______________ [Seal]
Name: Name:
Title: Title:
cc. Xxx Xxx Company Limited, Foamex International, Inc., Xx. Xxxxxxx X.
Xxxxxxxx, Xx.
Annex B
[Foamex Asia Co., Ltd letterhead]
Receipt
Date _____ 1997
To: Foamex Asia, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000 U.S.A.
Attention: __________________
Facsimile: 1 212 593 1363
Foamex Asia Co., Ltd., as the Borrower, has duly received from Foamex Asia,
Inc., as the Lender, the following amount:
[bullet] transferred to _____ [name of the Borrower's account] _____ Account No.
_____ at _____ [name of the Bank] _____ , _____ branch, the amount of
Thirty Six Million Three Hundred and Sixty Six Thousand Three Hundred
and Forty Baht (Baht 36,366,340).
This amount relates to a drawdown of the loan granted under the Loan Agreement
dated _____ 1997 between the Lender, the Borrower and HK.
All terms used herein shall have the same meaning as ascribed to them in the
Loan Agreement.
Foamex Asia Co., Ltd.
By: ______________ By: ______________ [Seal]
Name: Name:
Title: Title:
cc. Xxx Xxx Company Limited, Foamex International, Inc., Xx. Xxxxxxx X.
Xxxxxxxx, Xx.
Annex C
[Foamex Asia, Inc./Xxx Xxx Company Limited letterhead]
Repayment Notice
To: Foamex Asia Co., Ltd
22nd Floor, Sathorn City Tower
000 Xxxxx Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxx
Attention: __________________
Facsimile: __________
Date _________
Dear Sirs,
We refer to clause [6.2/6.3] of the Loan Agreement dated _______, 1997 between
the Lender, the Borrower and HK (the "Loan Agreement").
We hereby give notice to the Borrower under and pursuant to clause [6.2/6.3] of
the Loan Agreement requiring the Borrower to repay the Loan Amount and the
Interest (less any withholding tax deducted in accordance with clause 8 of the
Loan Agreement) to the following account within ten (10) Business Days of the
above date:
[bullet] [name of the Lender's account] Account No. _____ at _____ [name of the
Bank] _____ , _____ branch.
Upon payment of the Loan Amount and the Interest (less any withholding tax
deducted in accordance with clause 8 of the Loan Agreement), the Borrower shall
have fully discharged its obligations under the Loan Agreement.
All terms used herein shall have the same meaning as ascribed to them in the
Loan Agreement.
Yours faithfully,
[Foamex Asia, Inc./Xxx Xxx Company Limited]
By: ______________ By: ______________ [Seal]
Name: Name:
Title: Title:
cc. [Xxx Xxx Company Limited/Foamex Asia, Inc.], Foamex International Inc., Xx.
Xxxxxxx X. Xxxxxxxx, Xx.
Annex D
Option Agreement
CONTENTS
Clause Page
1. DEFINITIONS..............................................................1
2. AMOUNT...................................................................2
3. TERM ....................................................................2
4. DRAWDOWN.................................................................3
4.1 Timing of Drawdown...................................................3
4.2 Conditions...........................................................3
5. INTEREST.................................................................3
6. REPAYMENT................................................................3
6.1 Repayment by Borrower................................................3
6.2 Notice by Lender.....................................................3
6.3 Notice by HK.........................................................4
6.4 Repayment............................................................4
7. SUBSCRIPTION FOR B GROUP SHARES..........................................4
7.1 Subscription.........................................................4
7.2 Signing of Option Agreement..........................................5
8. PAYMENTS.................................................................5
9. REPRESENTATIONS AND WARRANTIES...........................................5
10. COSTS AND EXPENSES.......................................................6
11. NOTICES..................................................................6
12. FURTHER ASSURANCES.......................................................7
13. AMENDMENTS...............................................................7
14. WAIVER...................................................................7
15. ENTIRE AGREEMENT.........................................................7
16. INVALIDITY...............................................................7
17. ASSIGNMENT...............................................................8
18. GOVERNING LAW............................................................8
ANNEX A
Drawdown Notice
ANNEX B
Receipt
ANNEX C
Repayment Notice
ANNEX D
Option Agreement
