Item 9 (c)(2)
EXCHANGE AGENT AGREEMENT
Between
XXXXXXXXXX ELECTRONICS, LTD.
and
AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO,
as Exchange Agent
Dated as of December 16, 1996
Xxxxxxxxxx Electronics, Ltd.
$70,825,000
81/4% Convertible Senior Subordinated Debentures
due June 15, 2006
EXCHANGE AGENT AGREEMENT
THIS EXCHANGE AGENT AGREEMENT (this "Agreement") dated as of
December 16, 1996 made and entered into by and between AMERICAN
NATIONAL BANK AND TRUST COMPANY OF CHICAGO, as Exchange Agent
(the "Agent"), a national banking association, and XXXXXXXXXX
ELECTRONICS, LTD. (the "Company"), a Delaware corporation;
WITNESSETH
RECITALS
WHEREAS, pursuant to an Offering Circular and Consent
Solicitation (the "Offering Circular") the Company is offering to
exchange $1,000 principal amount of its 8-1/4% Convertible Senior
Subordinated Debentures due June 15, 2006 (the "New Debentures")
for each $1,000 of its 7-1/4% Subordinated Convertible Debentures
due December 15, 2006 (the "Old Debentures") and also soliciting
consents ("Consents") from holders of the Old Debentures (the
"Debentureholders") representing at least a majority in aggregate
principal amount of the outstanding Old Debentures (the
"Requisite Consents") to certain amendments to the indenture
under which the Old Debentures were issued (the "Old Indenture")
(collectively, the offer to exchange and solicitation of Consents
are referred to herein as the "Exchange Offer"); and
WHEREAS, in connection with the Exchange Offer,
Debentureholders will be delivering their Old Debentures to the
Agent and requesting delivery of New Debentures and Consents to
the proposed amendments, and
WHEREAS, the Company has delivered or will deliver to the
Agent (i) a copy of the Consent and Letter of Transmittal (the
"Letter of Transmittal") to be sent to the Debentureholders, in
the form attached hereto as Exhibit A, (ii) copies of all other
documents or materials to be forwarded to the Debentureholders;
and (iii) a list showing the names and addresses of all
Debentureholders as of the close of business on December 17, 1996,
and the number of Old Debentures held by each Debentureholder as
of the close of business on such date (the "List"), and
WHEREAS, the New Debentures will be issued under an
Indenture dated as of December 16, 1996 (the "New Indenture")
between the Company and American National Bank and Trust Company
of Chicago, as trustee (the "Trustee"); and
WHEREAS, the Indenture will be signed by the Trustee and the
Company on or about December 17, 1996 (the "Closing Date"); and
WHEREAS, this Agreement will confirm the appointment of
American National Bank and Trust Company of Chicago as exchange
agent, and, in that capacity, authorization to act as agent for
the Debentureholders for the purpose of receiving from the
Company the New Debentures to be issued in exchange for the Old
Debentures and transmitting same to the Debentureholders upon
satisfaction of conditions set forth herein.
NOW THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS,
UNDERTAKINGS AND PROMISES HEREINAFTER SET FORTH AND FOR OTHER
GOOD AND VALUABLE CONSIDERATION AND THE ACCEPTANCE OF THE SUM OF
TEN DOLLARS ($10.00) DULY PAID BY EACH OF THE PARTIES TO THE
OTHER UPON THE EXECUTION AND DELIVERY OF THIS AGREEMENT, THE
RECEIPT AND SUFFICIENCY OF WHICH IS HEREBY ACKNOWLEDGED AND
CONFESSED, THE PARTIES HERETO AGREE AS FOLLOWS:
1. Duties of Agent. The Agent will examine Letters of
Transmittal, Debentures and other documents delivered or mailed
to the agent by or for the Debentureholders, in order to
ascertain, to the extent reasonably determined by the Agent,
whether:
a) the Letters of Transmittal appear to be duly executed
and properly completed in accordance with the
instructions set forth therein;
b) the Old Debentures appear to be properly surrendered
and, if appropriate, endorsed for transfer;
c) the other documents, if any, used in the exchange
appear to be duly executed and properly completed and
in the proper form; and
d) the Old Debentures are free of restrictions on transfer
or stop orders except as set forth on the List.
In the event the Agent ascertains that any Letter of
Transmittal or other document has been improperly completed or
executed, that any of the Old Debentures are not in proper form
or some other irregularity exists, the Agent shall attempt to
resolve promptly the irregularity and may use its best efforts to
contact the appropriate Debentureholder by whatever means of
communication it deems most expedient in order to correct the
irregularity and, upon consultation with the Company, shall
endeavor to take such other reasonable action as may be necessary
to cause such irregularity to be corrected; and the determination
of any questions referred to the Company or its counsel by the
Agent as to the validity, form and eligibility, as well as the
proper completion or execution of the Letters of Transmittal and
other documents, shall be final and binding and the Agent may
rely thereon as provided in Section 8 hereof. Any costs of
contacting Debentureholders for the purpose of correcting
irregularities shall be charged to the Company.
2. Exchange of Debentures. As soon as practicable after
the Expiration Date and notification from the Company of the
satisfaction or waiver of the conditions to the Exchange Offer as
set forth in the Offering Circular and the principal amounts of
Old Debentures it is accepting for exchange and after surrender
to the Agent of all Old Debentures registered to a particular
Debentureholder and the return of a properly completed Letter of
Transmittal relating thereto, the Agent shall cause to be issued
and distributed to the Debentureholder in whose name such
certificates were registered New Debentures in the same principal
amount as the Old Debentures registered in the name of such
Debentureholder; provided, however, that if fewer than all of the
Old Debentures properly tendered for exchange are accepted by the
Company, properly tendered Old Debentures will be accepted and
New Debentures will be issued on a pro rata basis. Any Old
Debentures not accepted for exchange will be returned to the
Debentureholder.
If any New Debentures are to be issued in a name other than
that in which the Old Debentures surrendered in exchange therefor
is registered, it shall be a condition of the issuance thereof
that the Old Debenture so surrendered shall be properly endorsed
and otherwise in proper form for transfer and that the person
requesting such exchange shall pay to the Agent any transfer or
other taxes required, or shall establish to the Agent's
satisfaction that such tax has been paid or is not payable.
New Debentures and returned Old Debentures to be delivered
by mail shall be forwarded by first class mail under the Agent's
blanket surety bond, which the Company understand protects the
Company and the Agent from loss or liability arising by virtue of
the non-receipt or non-delivery of such New Debentures. It is
understood that the face value of New Debentures in any one
shipment sent by first class mail under this procedure will not
be in excess of $500,000. In the event the face value shall
exceed $500,000 the New Debentures shall be mailed by registered
mail and shall be insured separately for the replacement value of
its contents at the time of mailing.
3. Lost, Stolen or Destroyed Debentures. In the event
that any Debentureholder claims that any Debenture registered in
their name is lost, stolen or destroyed, the Agent shall mail to
such Debentureholder an affidavit of loss and an indemnity bond.
The Agent shall make the distribution of New Debentures only upon
receipt of a properly completed affidavit of loss and an
indemnity bond.
4. Reports. The Agent shall furnish, until otherwise
notified, weekly reports to the Company showing the number of Old
Debentures surrendered for exchange, the number of New Debentures
issued in exchange therefor and the Consents received.
5. Copies of Documents. The Agent shall take such action
at the Company's expense as may from time to time be reasonably
requested by the Company to furnish copies of the Letters of
Transmittal to persons designated by the Company.
6. Maintenance of Records. The Agent will keep and
maintain complete and accurate records showing all Old Debentures
exchanged by the Agent. The Agent is authorized to cooperate
with and furnish information to any organization or its legal
representatives designated from time to time by the Company in
any manner reasonably requested by any of them in connection with
the Exchange Offer. Letters of Transmittal and telegrams,
telexes, facsimile transmissions and other materials submitted to
the Agent shall be preserved by the Agent until delivered to or
otherwise disposed of in accordance with the Company's
instructions at or prior to the termination hereof.
7. Delivery of Surrendered Debentures. All Old Debentures
surrendered to the Agent shall be retained by the Agent, and
following the exchange of such Old Debentures, shall be forwarded
to the Company or elsewhere as directed by the Company. Consents
shall be forwarded to the Company or elsewhere as directed by the
Company.
8. The Exchange Agent's Duties and Obligations. The
Agent, in its capacity as Exchange Agent under this Agreement:
a) will have no duties or obligations other than those
specifically set forth herein, or as may subsequently
be agreed to in writing by the Agent and the Company;
b) will be regarded as making no representations or
warranties and having no responsibilities regarding the
validity, sufficiency, value or genuineness of any Old
Debentures surrendered to the Agent or the New
Debentures delivered by the Agent; will not be required
or requested to make any representations as to the
validity, value or genuineness of such Debentures; and
will not be responsible in any manner whatsoever for
the correctness of the statements made herein or in the
Indenture or in any document furnished to the Agent by
the Company;
c) will not be obligated to institute or defend any
action, suit or legal proceeding in connection with the
Exchange Offer or the Agent's duties hereunder, or take
any other action which might, in the Agent's judgment
involve, or result in, expense or liability to the
Agent, unless the Company shall first furnish the Agent
an indemnity satisfactory to the Agent;
d) may rely on, and shall be protected in acting upon, any
certificate, instrument, opinion, representation,
notice, letter, telegram or other document delivered to
the Agent and believed by the Agent to be genuine and
to have been signed by the proper party or parties;
e) may rely on, and shall be protected in acting upon,
written or oral instructions given by any officer of,
or any party authorized by the Company with respect to
any matter relating to the Agent's actions under this
Agreement;
f) may consult with counsel satisfactory to the Agent
(including counsel for the Company or the Agent) and
the advice or opinion of such counsel shall be full and
complete authorization and, protection in respect of
any action taken, suffered or omitted by the Agent
hereunder in good faith and in accordance with such
advice or opinion of such counsel; and
g) may retain an agent or agents of the Agent's choice to
assist the Agent in performing its duties and
obligations hereunder.
9. Termination of Exchange Agent's Duties and Obligations.
This Agreement shall terminate when all New Debentures have been
issued and delivered. The Agent will make any final exchanges of
Debentures within a reasonable time following the expiration of
the Exchange Offer on January 31, 1996.
10. Indemnification of Exchange Agent. The Company hereby
covenants and agrees to reimburse, indemnify and hold the Agent
harmless from and against any and all claims, actions, judgments,
damages, losses, liabilities, costs, transfer or other taxes, and
expenses (including without limitation reasonable attorney's fees
and expenses) which, without gross negligence or willful
misconduct by the Agent, may be paid, incurred or suffered by the
Agent, or to which the Agent may become subject, arising out of
or incident to this Agreement or the administration of its duties
hereunder, or arising out of or incident to its compliance with
the instructions set forth herein or with any instructions
delivered to the Agent pursuant hereto, or as a result of
defending itself against any claim or liability resulting from
its actions as Agent, including any claim against the Agent by
any Debentureholder, which covenant agreement shall survive the
termination hereof. The Agent hereby represents that it will
notify the Company by telephone, confirmed in writing, of any
receipt by the Agent of a written assertion of a claim against
the Agent, or any action commenced against the Agent, within ten
(10) business days after its receipt of written notice of such
assertion or its having been served with the summons or other
first legal process giving information as to the nature and basis
of any such action. However, the Agent's failure to so notify
the Company shall not operate in any manner whatsoever to relieve
the Company from any liability it may have on account of this
Section 10 if no prejudice occurs. At its election, the Company
will assume the conduct of the Agent's defense in any such action
or claim at its sole cost and expense. In the event that the
Company elects to assume the defense of any such action or claim
and confirms to the Agent in writing that the indemnity provided
for in this Section 10 applies to such action or claim, the
Company shall not be liable for the fees and expenses of any
counsel thereafter retained by the Agent; the foregoing
notwithstanding, if the Escrow Agent shall reasonably believe
that separate counsel is necessary to protect its, interests, it
shall be entitled to retain its own counsel and the reasonable
fees and expenses of such counsel shall be payable by the
Company.
11. Modification. Except as otherwise provided in Section
14 hereof, (i) the instructions contained herein may be modified
or supplemented only by an authorized representative of
Company and (ii) any inconsistency between this Agreement and the
Indenture shall be resolved in favor of the Indenture.
12. Fees and Expenses. The Agent shall be entitled to
receive the fees and expenses set forth in the letter from the
Agent dated December 10, 1996 and accepted and agreed to by the
Company.
13. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed
to have been duly given when placed in the hands of a carrier for
delivery, charges pre-paid:
(a) If to the Company, to: Xxxxxxxxxx Electronics, Ltd.
00X000 Xxxxxxxxx Xxxx
XxXxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
(000) 000-0000
(b) If to the Agent, to: American National Bank and
Trust Company of Chicago
00 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Corporate Trust Division
Telephone: (000) 000-0000
Fax: (000) 000-0000
or to such other address or addresses as the Company or the Agent
may communicate in writing to each of the other parties.
14. Entire Agreement. This Agreement, the Indenture and
the other documents referred to herein contain all terms and
conditions agreed upon by the parties hereto, and no other
agreements, oral or otherwise, regarding the subject matter
hereof shall be deemed to exist or bind the parties hereto unless
in writing and executed by the Agent and the Company.
15. Benefit of the Agreement and Third Party Beneficiaries.
This Agreement shall be binding upon and inure to the benefit of
the parties hereto and any successors and assigns. The Company
hereby acknowledges to any such successor and assign of the Agent
that the Company shall perform as to such successor and assign
all duties and obligations under this Agreement just as if such
successor or assign of the Agent had been originally named as a
party hereto and such successor and assign shall be a third party
beneficiary of this Agreement. The Company can assign and
transfer its rights under this Agreement with the consent of the
Agent, and such consent shall not be unreasonably withheld by the
Agent.
16. Governing Law and Severability. This Agreement shall
be governed by and construed in accordance with the laws of the
State of Illinois. The invalidity or unenforceability of any
provision of this Agreement shall not affect or impair the
validity, operation or enforceability of any other provision of
this Agreement.
17 Resolution of Inconsistent Provisions. In the event
any of the provisions of this Agreement and the Indenture are
inconsistent in any respect and cannot be reconciled, the
provisions of the Indenture shall control over the provisions of
this Agreement.
18. Execution and Counterparts. This Agreement may be
executed in any number of counterparts, each of which shall be an
original and all of which shall constitute but one and the same
instrument.
19. Headings. Section headings used in this Agreement are
for convenience of reference only and are not intended to be a
part of the provisions of this Agreement nor to control or affect
the meanings, construction or effect of the same.
20. Definition of Terms. For all purposes of this
Agreement, except as otherwise herein expressly provided or
unless the context otherwise requires, the terms and expressions
used in this Agreement shall have the same meaning as the
corresponding terms and expressions used in the Indenture and in
the Offering Circular.
21. Attachment; Compliance with Legal Orders. In the event
that any information or securities held hereunder shall be
attached, garnished, or levied upon by any court order, or the
delivery thereof shall be stayed or enjoined by an order of a
court, or any order, judgment or decree shall be made or entered
by any court order affecting the property deposited under this
Agreement, or any part thereof, the Exchange Agent is hereby
expressly authorized, in its sole direction, to obey and comply
with all writs, orders or decrees so entered or issued, which it
is advised by legal counsel of its own choosing is binding upon
it, whether with or without jurisdiction, and in the event that
the Exchange Agent obeys or complies with any such writ, order or
decree it shall not be liable to the Company or to any other
person, firm or corporation, by reason of such compliance
notwithstanding such writ, order or decree be subsequently
reversed, modified, annulled, set aside or vacated.
22. Conflicting Demands. In the event that conflicting
demands are made upon the Exchange Agent for any situation not
addressed in this Agreement, the Exchange Agent may withhold
performance of the terms of this Agreement until such time as
said conflicting demands shall have been withdrawn or the rights
of the respective parties shall have been settled by court
adjudication, arbitration, joint order or otherwise.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first written above.
AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO, as Exchange Agent
By: /s/ Xxxxxxxxx Xxxxxx
Its: Assistant Vice President
XXXXXXXXXX ELECTRONICS, LTD.
By: /s/ Xxxxxx X. Xxxxxxxxxx
Its: Chairman
