1
EXHIBIT 10.25
INTERCREDITOR AGREEMENT
THIS INTERCREDITOR AGREEMENT (this "Agreement") is entered into as of
May 29, 1998, between the Foothill Group Agent (as defined below) for and on
behalf of the Foothill Group (as defined below) and the Bank Group Agent (as
defined below) for and on behalf of the Bank Group (as defined below), with
reference to the following recitals of fact:
A. The Foothill Group provides financing to Debtor, pursuant to the
Foothill Group Financing Documents. The Foothill Group Claims are secured by a
security interest in the Collateral.
B. The Bank Group provides financing to Debtor, pursuant to the Bank
Group Financing Documents. The Bank Group Claims are secured by a security
interest in the Collateral.
C. The Foothill Group and the Bank Group wish to enter into this
Agreement to clarify their respective rights and priorities in the Collateral.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which hereby are acknowledged by each party hereto, the parties
hereto hereby agree that:
1. Definitions. Terms used herein that are defined in the UCC
have the meanings defined for those terms in the UCC unless otherwise expressly
defined herein. As used herein, the following terms shall have the meanings
respectively set forth after each:
"Above OLV Sale" means any Sale of Collateral by Debtor as to
which the Net Sale Consideration received is equal to or greater than
90% of the OLV of the assets subject to such Sale.
"Accounts" means all currently existing and hereafter arising
accounts, contract rights, and all other forms of obligations owing to
Debtor arising out of the sale, license, or lease of goods or the
rendition of services by Debtor, irrespective of whether earned by
performance, and any and all credit insurance, guaranties, or security
therefor.
"Agreed Asset Value" means: (a) with respect to any Accounts, the
Agreed Value of Accounts with respect thereto; (b) with respect to any
Inventory, the Agreed Value of Inventory with respect thereto; and (c)
with respect to any Fixed Assets, the Agreed Value of Fixed Assets with
respect thereto.
1
2
"Agreed Value of Accounts" means, with respect to any Accounts,
the net book value of such Accounts, determined in accordance with GAAP.
"Agreed Value of Fixed Assets" means: (a) with respect to any
Fixed Assets other than Fixed Assets of Strates Malaysia, the net book
value of such Fixed Assets, determined in accordance with GAAP; and (b)
with respect to the Fixed Assets of Strates Malaysia, the net book value
of AKT's Fixed Assets immediately preceding the time that AKT became an
indirect Subsidiary of StorMedia, net of any such Fixed Assets sold
after such acquisition and prior to the date of the relevant Sale, less
accumulated depreciation thereon from and after such date until the date
of determination, according to GAAP, but determined as if AKT had never
been acquired by StorMedia.
"Agreed Value of Inventory" means, with respect to any Obligor,
the net book value of its Inventory, determined in accordance with GAAP,
as of the last day of the month of such Obligor most recently ended for
which a balance sheet is available, adjusted by adding thereto the
incremental amount, if any, of inventory reserves relating to Inventory
on hand on the date of the relevant Sale taken by such Obligor during
the three-month period ending on such month-end date.
"Akashic" means Akashic Memories Corporation, a California
corporation.
"Akashic Collateral" means any Collateral owned by any Akashic
Entity.
"Akashic Domestic Collateral" means any Akashic Collateral that
is Domestic Collateral.
"Akashic Entities" means Akashic and its Subsidiaries,
collectively and individually.
"Akashic Foreign Collateral" means any Akashic Collateral that is
Foreign Collateral.
"AKT" means Akashic Kubota Technologies Sdn. Bhd., a company
organized under the laws of Malaysia and a Subsidiary of Akashic doing
business in Malaysia, which changed its name in February, 1998, to
Strates Sdn. Bhd.
"Bank" means any individual member of the Bank Group.
2
3
"Bank Group" means the Bank Group Agent, CIBC [Asia] Ltd., Banque
Nationale de Paris, San Xxxxxxxxx Xxxxxx, as Co-Agent, Banque Nationale
de Paris, Singapore Branch, Fleet National Bank, Sanwa Bank California,
Union Bank of California, N.A., and any other Person holding any Bank
Group Claim, and each of them, collectively and individually.
"Bank Group Agent" means Canadian Imperial Bank of Commerce, New
York Agency, acting as agent for the Banks pursuant to the Bank Group
Financing Documents, and any successor agent thereunder. Unless the
Foothill Group Agent shall have been notified otherwise in accordance
with Section 21 hereof, the Foothill Group Agent may presume that
Canadian Imperial Bank of Commerce continues to be the Bank Group Agent.
"Bank Group Agreement" means that certain Amended and Restated
Credit Agreement, dated as of May 29, 1998, among StorMedia
International and Strates, as borrowers, StorMedia, as parent guarantor,
and the Bank Group, as the same may from time to time be amended,
restated, supplemented, modified, renewed, extended, replaced, or
refinanced.
"Bank Group Claims" means all present and future claims of the
Bank Group against Debtor for the payment of money arising under or
related to the Bank Group Financing Documents, including all claims for
principal and interest (including interest accruing after the
commencement of a bankruptcy proceeding by or against Debtor
irrespective of whether a claim for such interest is allowed in such
proceeding), or for reimbursement in connection with amounts paid under
letters of credit or for cash collateralization of amounts available to
be drawn under letters of credit, or for reimbursement of late charges,
fees, costs or expenses, or otherwise, whether fixed or contingent,
matured or unmatured, liquidated or unliquidated, and whether arising
under contract, in tort or otherwise; provided that the aggregate
principal amount of Bank Group Claims entitled to priority under this
Agreement shall not exceed $38,400,000 unless the Foothill Group Agent
agrees otherwise.
"Bank Group Enforcement Notice" means a written notice from the
Bank Group Agent to the Foothill Group Agent, given in accordance with
Section 21 hereof, stating that (a) a Bank Group Event of Default has
occurred and is continuing, and (b) the Bank Group desires and intends
(subject to any applicable waiting periods or other restrictions
provided for in this Agreement) to take Enforcement Action(s) against
the Foothill Group Priority Collateral or the Equal Priority Collateral.
3
4
"Bank Group Event of Default" means an "Event of Default" as
defined under the Bank Group Financing Documents.
"Bank Group Excess Claim" means any claim that would be a Bank
Group Claim but for the fact that (a) it does not arise under and is not
related to the Bank Group Financing Documents, or (b) it is in excess of
the dollar limitation applicable to Bank Group Claims, to the extent of
such excess.
"Bank Group Financing Documents" means the Bank Group Agreement
and all present and future notes, guaranties, reimbursement agreements,
security documents or other documents or agreements in any way related
to, evidencing, or documenting the Bank Group Claims, as the same may
from time to time be amended, restated, supplemented, modified, renewed,
extended, replaced, or refinanced.
"Bank Group Priority Collateral" means (a) all Fixed Assets of
any StorMedia Entity, irrespective of whether they constitute StorMedia
Domestic Collateral or StorMedia Foreign Collateral, (b) all Fixed
Assets of any Akashic Entity that constitute Akashic Foreign Collateral,
(c) all Stock of any Bank Group Priority Subsidiary, (d) all
Identifiable Proceeds of any Bank Group Priority Collateral, and (e) all
Purchaser Notes delivered to or pledged to the Bank Group Agent pursuant
to Section 17(a) of this Agreement.
"Bank Group Priority Subsidiaries" means the StorMedia
Subsidiaries other than the Foothill Group Priority Subsidiaries.
"Below OLV Sale" means any Sale of Collateral by Debtor as to
which the Net Sale Consideration received for such Sale is less than 90%
of the OLV of the assets subject to such Sale.
"Business Day" means any day that is not a Saturday, Sunday, or
other day on which national banks are authorized or required to close.
"Carryforward Reduction Amount" means, with respect to any Below
OLV Sale, an amount equal to (a) the Minimum Prepayment Amount
applicable to such Sale, minus (b) the amount of the prepayment paid in
cash to the Bank Group with respect to such Sale.
"Claims" means the Foothill Group Claims and the Bank Group
Claims.
4
5
"Collateral" means all tangible and intangible property of
Debtor, whether real or personal, wherever located, including all of
Debtor's Accounts, General Intangibles, documents, chattel paper,
investment property, instruments, money, deposit accounts, securities,
Stock, Fixed Assets, machinery, equipment, furnishings, fixtures,
Inventory, and real property, and all products and proceeds of any of
the foregoing.
"Creditors" means the Foothill Group, represented by the Foothill
Group Agent, and the Bank Group, represented by the Bank Group Agent,
collectively and individually.
"Debtor" means StorMedia and each and every one of its present
and future direct and indirect Subsidiaries, collectively and
individually, including each and every such Subsidiary that now is, or
at any time hereafter becomes, a party to any one or more of the
Financing Documents (including StorMedia International, Strates, SFSC,
Akashic, and Strates Malaysia).
"Domestic Collateral" means (a) in the case of tangible
Collateral, any such Collateral located within the United States of
America or its possessions, dependencies, or territories, and (b) in the
case of intangible Collateral, any such Collateral of an entity
composing Debtor that is organized under the laws of, or maintains its
principal place of business in, the United States of America, its
possessions, dependencies, or territories, or any of the States
composing the United States of America. The Stock of StorMedia
International, Strates, and Strates Malaysia shall be deemed Foreign
Collateral and not Domestic Collateral, and the Stock of SFSC and
Akashic shall be deemed Domestic Collateral and not Foreign Collateral.
"Enforcement Action" means, with respect to any Creditor and with
respect to any item of Collateral (a) repossessing, selling, leasing, or
otherwise disposing of all or any part of such Collateral, or exercising
notification or collection rights with respect to all or any portion
thereof, or attempting to do so, (b) commencing the enforcement with
respect to such Collateral of any of the default remedies under any of
such Creditor's Financing Documents, the UCC, or other applicable laws,
including the commencement of any lawsuit or proceeding against Debtor
to collect or enforce such Creditor's Claim, (c) appropriating, setting
off (except for the daily cash sweep under the Foothill Group Financing
Documents), or applying any part or all of such Collateral in the
possession of, or coming into the possession of, such Creditor or its
agent or bailee, to such Creditor's Claim, or (d) filing by such
Creditor of, or the joining in the filing by such Creditor of, an
involuntary bankruptcy or insolvency proceeding against Debtor,
provided, however, that, with respect to any filing by any Person other
than a Creditor of a proceeding, motion, or suit described in
clause (d),
5
6
the filing by any Creditor of any claim in or the taking of any other
action (not inconsistent with the express provisions of this Agreement)
permitted or required by applicable law with respect to any such
proceeding, motion, or suit shall not be deemed to be an Enforcement
Action.
"Enforcement Period" means, with respect to the Claims of any
Creditor, any period of time commencing upon the earliest to occur of
(a) the actual taking by such Creditor of any Enforcement Action (other
than an insignificant or immaterial Enforcement Action) under
circumstances where such Creditor is entitled to do so under the terms
of its Financing Documents, (b) the acceleration by such Creditor of the
maturity of its Claims, (c) the maturation of such Creditor's Claims in
accordance with their terms if such Claims are not paid or satisfied on
such date of maturation, (d) the commencement of an Insolvency
Proceeding with respect to Debtor, (e) the permanent termination (as
opposed to temporary suspension) by such Creditor of its obligations to
Debtor under its Financing Documents based on the existence of an Event
of Default, (f) the giving of a Bank Group Enforcement Notice, (g) the
giving of a Foothill Group Enforcement Notice, or (h) the giving of a
Foothill Group Equal Priority Collateral Enforcement Notice, and
continuing until the earlier to occur of (y) the final payment or
satisfaction in full of such Creditor's Claims, or (z) the waiver in
writing by such Creditor of such Creditor Event of Default.
"Equal Priority Collateral" means all General Intangibles of
Debtor other than Identifiable Proceeds described in clause (d) of the
definition of Bank Group Priority Collateral. For purposes of clarity,
Equal Priority Collateral does not include Stock, Accounts, Inventory,
or Fixed Assets.
"Event of Default" means a Bank Group Event of Default or a
Foothill Group Event of Default, as the context requires.
"Excess Prepayment Amount" means an amount equal to 50% of the
Net Sale Consideration in excess of the Minimum Prepayment Amount.
"Financing Documents" means the Foothill Group Financing
Documents and the Bank Group Financing Documents.
"Fixed Assets" means, with respect to any Obligor, all real
property, plant, and equipment (including fixtures) of such Obligor.
6
7
"Foothill Group" means Foothill Capital Corporation in its
individual capacity and as the Foothill Group Agent, Xxxxxxxxx, L.L.C.,
and any other person holding any Foothill Group Claim, and each of them,
collectively and individually.
"Foothill Group Agent" means Foothill Capital Corporation, a
California corporation, acting as agent for the members of the Foothill
Group pursuant to the Foothill Group Financing Documents, and any
successor agent thereunder. Unless Bank Group Agent shall have been
notified otherwise in accordance with Section 21 hereof, Bank Group
Agent may presume that Foothill Capital Corporation continues to be the
Foothill Group Agent.
"Foothill Group Agreement" means that certain Loan and Security
Agreement, dated as of May 29, 1998, between StorMedia and Akashic, on
the one hand, and, on the other hand, the Foothill Group, as the same
may from time to time be amended, modified, renewed, extended or
restated.
"Foothill Group Claims" means all present and future claims of
the Foothill Group against Debtor for the payment of money arising under
or related to the Foothill Group Financing Documents, including all
claims for principal and interest (including interest accruing after the
commencement of a bankruptcy proceeding by or against Debtor
irrespective of whether a claim for such interest is allowed in such
proceeding), or for reimbursement in connection with amounts paid under
letters of credit (or guaranties in respect thereof) or for cash
collateralization of amounts available to be drawn under letters of
credit (or guaranties in respect thereof), or for reimbursement of late
charges, fees, costs or expenses, or otherwise, whether fixed or
contingent, matured or unmatured, liquidated or unliquidated, and
whether arising under contract, in tort or otherwise; provided that the
aggregate principal amount of Foothill Group Claims entitled to priority
under this Agreement shall not exceed, as of any date of determination,
(a) $30,000,000, minus (b) the aggregate amount of principal repayments
made with respect to the Bridge Term Loan, unless the Bank Group Agent
agrees otherwise.
"Foothill Group Enforcement Notice" means a written notice from
the Foothill Group Agent to the Bank Group Agent, given in accordance
with Section 21 hereof, stating that (a) a Foothill Group Event of
Default has occurred and is continuing, and (b) the Foothill Group
desires and intends (subject to any applicable waiting periods or other
restrictions provided for in this Agreement) to take Enforcement
Action(s) against the Bank Group Priority Collateral.
7
8
"Foothill Group Equal Priority Collateral Enforcement Notice"
means a written notice from the Foothill Group Agent to the Bank Group
Agent, given in accordance with Section 21 hereof, stating that (a) a
Foothill Group Event of Default has occurred and is continuing, and (b)
the Foothill Group desires and intends (subject to any applicable
provisions of this Agreement) to take Enforcement Action(s) against the
Equal Priority Collateral.
"Foothill Group Event of Default" means an "Event of Default" as
defined under the Foothill Group Financing Documents.
"Foothill Group Excess Claim" means any claim that would be a
Foothill Group Claim but for the fact that (a) it does not arise under
and is not related to the Foothill Group Financing Documents, or (b) it
is in excess of the dollar limitation applicable to Foothill Group
Claims, to the extent of such excess.
"Foothill Group Financing Documents" means the Foothill Group
Agreement and all present and future notes, guaranties, reimbursement
agreements, security documents or other documents or agreements in any
way related to, evidencing, or documenting the Foothill Group Claims, as
the same may from time to time be amended, restated, supplemented,
modified, renewed, extended, replaced, or refinanced.
"Foothill Group Priority Collateral" means all Collateral other
than the Bank Group Priority Collateral and the Equal Priority
Collateral.
"Foothill Group Priority Subsidiaries" means SFSC and Akashic.
"Foothill OLV" means "OLV" as defined in the Foothill Group
Agreement.
"Foreign Collateral" means any Collateral that is not Domestic
Collateral. The Stock of StorMedia International, Strates, and Strates
Malaysia shall be deemed Foreign Collateral and not Domestic Collateral,
and the Stock of SFSC and Akashic shall be deemed Domestic Collateral
and not Foreign Collateral.
"GAAP" means generally accepted accounting principles as in
effect from time to time, consistently applied.
"General Intangibles" means, with respect to any Person, all
general intangibles (exclusive of deposit accounts and investment
property) of such Person.
8
9
"Identifiable Proceeds" means, with respect to any Collateral,
any "proceeds" (as defined in the UCC) or other sums received in respect
of such Collateral that are identifiable and traceable under the
identification and tracing rules and principles that exist under
California state law (including the UCC), without regard to where such
Collateral or proceeds are located, provided that Identifiable Proceeds
included within clause (d) of the definition of "Bank Group Priority
Collateral" shall not include (a) Inventory of any Obligor, (b) any
Accounts of any Obligor arising from the sale, transfer, lease, license,
or other disposition of Inventory by any Obligor, or (c) Fixed Assets
that are Akashic Domestic Collateral.
"Insolvency Proceeding" means any proceeding commenced by or
against any Person under any provision of the United States Bankruptcy
Code or under any other bankruptcy or insolvency law, assignments for
the benefit of creditors, or proceedings seeking reorganization,
arrangement, or other similar relief.
"Inventory" means all present and future inventory in which
Debtor has any interest, including goods held for sale or lease or to be
furnished under a contract of service and all of Debtor's present and
future raw materials, work in process, finished goods, and packing and
shipping materials, wherever located.
"Malaysian Exception" means that, anything in Section 17(b) or
Section 17(c) to the contrary notwithstanding, the Foothill Group Agent
may not make or commit to make any Stock Sale of any Stock of any
Foothill Group Priority Subsidiary unless either (a) the Bank Group
Agent has consented in its sole and absolute discretion to such Stock
Sale, or (b) the Stock of Strates Malaysia has been transferred to
StorMedia or a Bank Group Priority Subsidiary such that Strates Malaysia
is no longer a Subsidiary of any Foothill Group Priority Subsidiary
subject to the Lien of the Bank Group Agent.
"Minimum Availability Condition" has the meaning ascribed to such
term in the Foothill Group Loan Agreement as in effect on the effective
date hereof, without regard to any subsequent amendments or
modifications of such term except such as have been consented to in
writing by the Bank Group Agent in its sole and absolute discretion.
"Minimum Prepayment Amount" means, as to any Sale of Collateral,
an amount equal to 90% of the OLV of the assets subject to such Sale.
9
10
"Net Sale Consideration" means (a) the total purchase
consideration received by Debtor in any Sale of Collateral, less (b) the
amount of any reasonable out-of-pocket expenses (including taxes)
incurred by Debtor in connection with such Sale.
"Obligor" means any Person comprising Debtor.
"OLV" means, as to any item of Collateral, an amount equal to the
orderly liquidation value for such item of Collateral as set forth in
the appraisals of the Collateral performed by Xxxx DoveTech dated
January 31, 1998 or Xxxxx Xxxxxxx dated January 24, 1998.
"perfection" has the meaning such term has when used in Division
9 of the UCC.
"Person" means and includes natural persons, corporations,
limited liability companies, limited partnerships, general partnerships,
limited liability partnerships, joint ventures, trusts, land trusts,
business trusts, or other organizations, irrespective of whether they
are legal entities, and governments and agencies and political
subdivisions thereof.
"Prepayment Carryforward" means, as of any date of determination,
an amount, equal to (a) the aggregate of the Excess Prepayment Amount
(or portions thereof) paid to the Bank Group with respect to each Above
OLV Sale consummated prior to such date, if any, minus (b) the aggregate
Carryforward Reduction Amount with respect to each Below OLV Sale
consummated prior to such date, if any.
"Purchaser Note" shall have the meaning set forth in Section
17(a).
"Relevant Minimum Price" means, with respect to any Stock Sale:
(a) If such Stock Sale is of the Stock of a Bank Group Priority
Subsidiary, the Agreed Asset Value of that portion of the Relevant
Released Collateral consisting of: (i) Accounts; and (ii) Inventory; and
(b) if such Stock Sale is of the Stock of a Foothill Group Priority
Subsidiary, the Agreed Asset Value of that portion of the Relevant
Released Collateral consisting of: (i) Accounts; (ii) Inventory; and
(iii) Fixed Assets that are not Akashic Domestic Collateral.
"Relevant Released Collateral" means with respect to any Stock
Sale effected in compliance with Section 17(c) of this Agreement, and
except as otherwise provided in Section 17(d) of this Agreement, (a) the
Stock being sold, (b) after giving effect to the Malaysian Exception,
the Stock of any Subsidiaries of the Obligor whose Stock is
10
11
being sold to the extent owned by the Obligor whose Stock is being sold
or any Subsidiary of such Obligor, and (c) the assets of the Obligor
whose Stock is being sold and the assets of each Subsidiary of such
Obligor.
"Sale" means the sale, lease, or other disposition by Debtor of
any item of the Collateral (other than the Stock of any direct or
indirect Subsidiary of StorMedia, whether or not made or entered into in
the ordinary course of business).
"SFSC" means StorMedia Foreign Sales Corporation, a corporation
organized under the laws of the U.S. Virgin Islands.
"Stock" means all shares, options, warrants, interests,
participations, or other equivalents (regardless of how designated) of
or in a corporation or equivalent entity, whether voting or nonvoting,
including common stock, preferred stock, or any other "equity security"
(as such term is defined in Rule 3a11-1 of the General Rules and
Regulations promulgated by the Securities Exchange Commission under the
Securities Exchange Act of 1934).
"Stock Sale" means any sale or transfer of the Stock of any
StorMedia Subsidiary, whether by the Obligor owning same with any
necessary Creditor consents, or by a Creditor in realization of its
security interest therein in accordance with the provisions of this
Agreement.
"Stock Sale Consideration" means, with respect to any Stock Sale,
the net consideration received by the seller after deducting any
reasonable out-of-pocket expenses (including taxes) incurred in
connection with such Sale.
"StorMedia" means StorMedia Incorporated, a California
corporation.
"StorMedia Collateral" means any Collateral owned by any
StorMedia Entity.
"StorMedia Domestic Collateral" means any StorMedia Collateral
that is Domestic Collateral.
"StorMedia Entities" means StorMedia and its Subsidiaries,
collectively and individually, except for and excluding the Akashic
Entities.
"StorMedia Foreign Collateral" means any StorMedia Collateral
that is Foreign Collateral.
11
12
"StorMedia International" means StorMedia International Ltd., a
company organized under the laws of the Cayman Islands.
"StorMedia Subsidiaries" means the Subsidiaries of StorMedia,
including StorMedia International, Strates, SFSC, Akashic, and Strates
Malaysia.
"Strates" means Strates Pte. Ltd., a company organized under the
laws of Singapore.
"Strates Malaysia" means Strates Sdn. Bhd., a company organized
under the laws of Malaysia, formerly known as Akashic Kubota
Technologies Sdn. Bhd.
"Subsidiary" of a Person means a corporation, partnership,
limited liability company, or other entity in which that Person directly
or indirectly owns or controls the shares of Stock (or comparable
ownership unit) having ordinary voting power to elect a majority of the
board of directors (or appoint other comparable managers) of such
corporation, partnership, limited liability company, or other entity.
"Tasman Facility" means Akashic Domestic Collateral consisting of
the Fixed Assets located on the effective date of this Agreement at 305
and/or 0000 Xxxxxx, Xxxxxxxx, Xxxxxxxxxx.
"UCC" means the California Uniform Commercial Code, as in effect
from time to time.
2. Security Interest Priorities. Notwithstanding (a) the
date, manner or order of perfection of the security interests and liens granted
in favor of Creditors, (b) the provisions of the UCC or any other applicable law
or decisions that would provide for different priorities, (c) the provisions of
any contract or Financing Document in effect between either Creditor, on the one
hand, and Debtor, on the other, and (d) whether either Creditor or any agent or
bailee thereof holds possession of any part or all of the Collateral, the
following, as among Creditors, shall be the relative priority of the valid,
perfected, and enforceable security interests and liens of Creditors in the
Collateral:
(i) The Bank Group shall have a first priority security
interest in the Bank Group Priority Collateral to the extent of the Bank
Group Claims, and the Foothill Group shall have a second priority
security interest therein to the extent of the Foothill Group Claims.
12
13
(ii) The Foothill Group shall have a first priority security
interest in the Foothill Group Priority Collateral to the extent of the
Foothill Group Claims, and the Bank Group shall have a second priority
security interest therein to the extent of the Bank Group Claims.
(iii) Each of the Foothill Group and the Bank Group shall have a
security interest in the Equal Priority Collateral, to the extent of
such Creditor's Claims, that is separate and distinct from, but of equal
priority to, the other Creditor's security interest therein.
For the purposes of the foregoing allocation of priorities, any claim of a right
of setoff shall be treated in all respects as a security interest, and no
claimed right of setoff shall be asserted to defeat or diminish the rights or
priorities provided for herein. The priorities set forth herein are solely for
the purpose of establishing the relative rights of the Creditors and, except as
provided in Sections 17(a) or 17(c) hereof, there are no other persons or
entities who are intended to be benefitted in any way by this Agreement.
3. Distribution of Proceeds of Collateral. During any
Enforcement Period, all net cash proceeds from realizations upon Collateral
shall be distributed in accordance with the following procedure:
(a) All net cash proceeds from realizations upon Foothill
Group Priority Collateral shall be applied first to the Foothill Group Claims.
After the Foothill Group Claims are paid in full, in cash, any remaining net
cash proceeds from realizations upon Foothill Group Priority Collateral shall be
paid to the Bank Group Claims until they are paid in full, in cash. After the
Bank Group Claims are paid in full, in cash, any remaining net cash proceeds
from realizations upon Foothill Group Priority Collateral shall be paid to the
Foothill Group Excess Claims until they are paid in full, in cash. After the
Foothill Group Excess Claims are paid in full, in cash, any remaining net cash
proceeds from realizations upon Foothill Group Priority Collateral shall be paid
to the Bank Group Excess Claims until they are paid in full, in cash.
(b) All net cash proceeds from realizations upon the Bank
Group Priority Collateral shall be applied first to the Bank Group Claims. After
the Bank Group Claims are paid in full, in cash, any remaining net cash proceeds
from realizations upon the Bank Group Priority Collateral shall be applied to
the Foothill Group Claims until they are paid in full, in cash. After the
Foothill Group Claims are paid in full, in cash, any remaining net cash proceeds
from realizations upon the Bank Group Priority Collateral shall be applied to
the Bank Group Excess Claims until they are paid in full, in cash. After the
Bank Group Excess
13
14
Claims are paid in full, in cash, any remaining net cash proceeds from
realizations upon the Bank Group Priority Collateral shall be applied to the
Foothill Group Excess Claims until they are paid in full, in cash.
(c) 50% of all net cash proceeds from realizations upon Equal
Priority Collateral shall be applied to the Foothill Group Claims and the other
50% of all net cash proceeds from realizations upon Equal Priority Collateral
shall be applied to the Bank Group Claims. After either Creditor's Claims are
paid in full, in cash, any remaining net cash proceeds from realizations upon
Equal Priority Collateral shall be applied to the other Creditor's Claims until
they are paid in full, in cash. After both Creditors' Claims are paid in full,
in cash, any remaining cash proceeds from realizations upon Equal Priority
Collateral shall be applied 50/50 to any Foothill Group Excess Claims and/or
Bank Group Excess Claims until they are paid in full.
(d) After all of the Claims, any Foothill Group Excess Claims,
and any Bank Group Excess Claims, have been paid or otherwise satisfied in full,
in cash, the balance of net cash proceeds from realizations upon Collateral, if
any, shall be paid to Debtor or as otherwise required by applicable law.
(e) Should any Identifiable Proceeds of Collateral be received
by any Creditor (the "Receiving Creditor") which, to the actual knowledge of
such Receiving Creditor, should, in accordance with the terms of this Section 3,
be paid to another Creditor (the "Entitled Creditor"), the Receiving Creditor
shall hold such Identifiable Proceeds for the benefit of the Entitled Creditor
and shall promptly deliver the same (in kind, if practicable, or otherwise its
equivalent) to the Foothill Group Agent or the Bank Group Agent, as the case may
be, for application to (in the case of cash or its equivalent), or to be held as
collateral for (in the case of other property), the Foothill Group Claims or the
Bank Group Claims, as applicable, together with any necessary non-recourse
assignment or endorsement. If the Receiving Creditor fails to provide any such
assignment or endorsement, the Entitled Creditor may supply the same. No
Creditor shall have liability for, nor shall be required to disgorge, any
accidental application of Identifiable Proceeds to the reduction of its Claims
if it received same without actual knowledge that another Creditor was entitled
thereto and applied same to reduction of its own Claims in the good faith belief
that it was entitled so to do, to the extent that it extended further credit or
financial accommodations as a consequence of or in reliance upon such receipt
and application.
4. Enforcement Actions. The Creditors agree that:
(a) The Foothill Group may, at its option, during any
Enforcement Period relating to the Foothill Group Claims, take any Enforcement
Action it deems appropriate with
14
15
respect to the Foothill Group Priority Collateral or the Equal Priority
Collateral, without any requirement that it obtain the prior consent of the Bank
Group; provided that, prior to or concurrent with the taking of any such
Enforcement Action, the Foothill Group Agent will endeavor in good faith to give
to the Bank Group Agent a Foothill Group Equal Priority Collateral Enforcement
Notice (but the failure to give such a notice shall not give rise to any
liability on the part of the Foothill Group Agent or the Foothill Group unless
such failure was intentional or in bad faith).
(b) The Bank Group may, at its option, during any Enforcement
Period relating to the Bank Group Claims, take any Enforcement Action it deems
appropriate with respect to the Bank Group Priority Collateral, without any
requirement that it obtain the prior consent of the Foothill Group; provided,
however, that (i) the Bank Group hereby agrees that the Foothill Group Agent (or
its duly authorized agents or representatives), at its option, shall have the
right and license to use, in peace and without disturbance by the Bank Group
(provided that ongoing efforts of the Bank Group to find buyers for, or to
arrange to consummate sales or other dispositions of, such Fixed Assets (or of
the Stock of any Obligor that owns such Fixed Assets, or of the Stock of any
other Obligor of which the owner of such Fixed Assets is a Subsidiary),
including showing same to potential buyers, and including instituting procedural
steps necessary or incidental to foreclosure such as the giving or publication
of notices, the commencement of legal proceedings, or the scheduling of sales or
auctions, shall not be considered disturbance of the Foothill Group Agent's
right of peaceful and undisturbed use so long as such efforts do not, in fact,
substantially disrupt or interfere with such use), all or part of the Fixed
Assets included in the Bank Group Priority Collateral for a period of time not
to exceed 30 days after the first to occur of (x) the Foothill Group Agent's
receipt of notice from the Bank Group Agent that the Bank Group Agent intends to
dispose of certain specified Fixed Assets 30 days hence, (y) the Bank Group
Agent's receipt of notice from the Foothill Group Agent of the Foothill Group's
request for license to use certain specified Fixed Assets and that such license
period commence, or (z) the date on which the Foothill Group Agent first
receives possession of the Foothill Group Priority Collateral, conditioned on
the payment by the Foothill Group to the Bank Group Agent for the benefit of the
Bank Group of reasonable rent for any Fixed Assets constituting Bank Group
Priority Collateral identified in the notice described in subparagraph (x) or
(y), as applicable, above with respect to the period of their actual use; such
right and license being provided to the Foothill Group Agent to enable it (or
its agents) to complete the manufacture, assembly, and sale of Inventory of
Debtor extant at the time of the receipt of such notice, and (ii) from and after
the commencement of and during the continuation of such period, the right of the
Bank Group to take any such Enforcement Action with respect to that portion of
the Bank Group Priority Collateral that is the subject of such right and license
shall be subject to the right and license of use thereof by the Foothill Group
Agent, as delineated above; provided, however, if the Foothill Group is enjoined
or stayed from taking any of the preceding Enforcement
15
16
Actions by a court of competent jurisdiction or the commencement of an
insolvency proceeding, then the 30-day period referred to above shall be
extended by the number of days in which the Foothill Group is so enjoined or
stayed (the "Extension Period"); provided, further, that such Extension Period
shall not exceed 30 days (A) if the Bank Group is not enjoined or stayed from
exercising its Enforcement Actions with respect to Fixed Assets included in the
Bank Group Priority Collateral during such Extension Period, or (B) if the Bank
Group is so enjoined or stayed during the Extension Period, after the date of
such injunction or stay as to the exercise of the Bank Group's Enforcement
Actions is vacated.
(c) Except as permitted by and in accordance with Section 7
hereof, until the Bank Group Claims have been paid or satisfied in full, the
Foothill Group Agent shall not take any Enforcement Action against the Bank
Group Priority Collateral without first obtaining the prior written consent of
the Bank Group in its sole and absolute discretion.
(d) Except as permitted by and in accordance with Section 7
hereof, until the Foothill Group Claims have been paid or satisfied in full, the
Bank Group shall not take any Enforcement Action against the Foothill Group
Priority Collateral or the Equal Priority Collateral without first obtaining the
prior written consent of the Foothill Group in its sole and absolute discretion.
(e) To the extent that any Bank now or hereafter maintains
deposit accounts for, or provides lock box services to, Debtor, such Bank, for
the benefit of the Foothill Group, so long as any Foothill Group Claims remain
outstanding or the Foothill Group has any commitment to extend credit to Debtor,
irrevocably waives any right to set off funds in such deposit accounts or lock
boxes against obligations due such Bank or the Bank Group, except only that such
Bank may recoup from funds in such deposit accounts or lock boxes its customary
service charges and fees relating to the provision of deposit account or lock
box services (subject to the terms of any applicable lockbox account agreement).
5. Waiver of Right to Require Marshaling. Each Creditor
expressly hereby waives any right that it otherwise might have to require the
other Creditor to marshal assets or to resort to Collateral in any particular
order or manner, whether provided for by common law or statute, including the
provisions of California Civil Code Sections 2899 and 3433, provided that this
paragraph shall not override any specific provision of this Agreement. No
Creditor shall be required to enforce any guaranty or any security interest
given by any Person as a condition precedent or concurrent to the taking of any
Enforcement Action.
6. Exercise of Remedies. Subject only to any express
provision of this Agreement that requires a Creditor to take or refrain from
taking an action, (a) each Creditor may exercise its good faith discretion with
respect to exercising or refraining from exercising
16
17
any of its rights and remedies or taking any Enforcement Action, (b) the Bank
Group agrees that the Foothill Group shall not incur any liability to the Bank
Group for taking or refraining from taking any action with respect to the
Foothill Group Priority Collateral or the Equal Priority Collateral, and (c) the
Foothill Group agrees that the Bank Group shall not incur any liability to the
Foothill Group for taking or refraining from taking any action with respect to
the Bank Group Priority Collateral or, subject to the provisions hereof, the
Equal Priority Collateral.
7. Enforcement of Junior or Equal Priority Security Interests
in Collateral.
(a) If (i)(x) 120 consecutive days have elapsed since the
giving by the Bank Group Agent to the Foothill Group Agent of a Bank Group
Enforcement Notice, (y) one or more Bank Group Events of Default shall have
existed at each point in time during such elapsed period, and (z) at the
conclusion of such elapsed period, one or more Bank Group Events of Default
remain in existence and have not been waived, or (ii) there is commenced, either
by or against Debtor, a bankruptcy or insolvency proceeding, then, subject to
applicable law, and subject to compliance with the terms and provisions of the
Bank Group Financing Documents, the Bank Group may proceed to take Enforcement
Action against the Foothill Group Priority Collateral or the Equal Priority
Collateral (in the case of clause (ii) above, solely with respect to Collateral
of the applicable Person which is the subject of such proceeding), provided that
such Enforcement Action is subject to all prior rights (including Section 3
hereof) of the Foothill Group in the Foothill Group Priority Collateral and all
rights (including Section 3 hereof) of the Foothill Group in the Equal Priority
Collateral, as the case may be.
(b) If (i)(x) 120 consecutive days have elapsed since the
giving by the Foothill Group Agent to the Bank Group Agent of a Foothill Group
Enforcement Notice, (y) one or more Foothill Group Events of Default shall have
existed at each point in time during such elapsed period, and (z) at the
conclusion of such elapsed period, one or more Foothill Group Events of Default
remain in existence and have not been waived, or (ii) there is commenced, either
by or against Debtor, a bankruptcy or insolvency proceeding, then, subject to
applicable law, and subject to compliance with the terms and provisions of the
Foothill Group Financing Documents, the Foothill Group may proceed to take
Enforcement Action against the Bank Group Priority Collateral (in the case of
clause (ii) above, solely with respect to Collateral of the applicable Person
which is the subject of such proceeding), provided that such Enforcement Action
is subject to all prior rights (including Section 3 hereof) of the Bank Group in
the Bank Group Priority Collateral and the limited rights (including Section 3
hereof) of the Bank Group with respect to the Equal Priority Collateral, as the
case may be.
17
18
8. Cross-Defaults and Unwind Provisions. If a Bank Group
Event of Default exists that is premised solely on the existence of a Foothill
Group Event of Default or on the giving by the Foothill Group Agent of a
Foothill Group Enforcement Notice, and if such Foothill Group Event of Default
is waived, or such Foothill Group Enforcement Notice is withdrawn or rescinded
by the Foothill Group Agent or the Foothill Group, then that Bank Group Event of
Default likewise automatically shall be waived. The immediately foregoing
sentence notwithstanding, if, at the time of such cure, waiver, or rescission,
other Bank Group Events of Default also exist that are not premised solely on
the existence of a Foothill Group Event of Default or on the giving by the
Foothill Group Agent of a Foothill Group Enforcement Notice, such other Bank
Group Events of Default shall not automatically be waived pursuant to the
provisions of the immediately foregoing sentence. If a Foothill Group Event of
Default exists that is premised solely on the existence of a Bank Group Event of
Default or on the giving by the Bank Group Agent of a Bank Group Enforcement
Notice, and if such Bank Group Event of Default is waived, or such Bank Group
Enforcement Notice is withdrawn or rescinded by the Bank Group Agent or the Bank
Group, then that Foothill Group Event of Default likewise automatically shall be
waived. The immediately foregoing sentence notwithstanding, if, at the time of
such cure, waiver, or rescission, other Foothill Group Events of Default also
exist that are not premised solely on the existence of a Bank Group Event of
Default or on the giving by the Bank Group Agent of a Bank Group Enforcement
Notice, such other Foothill Group Events of Default shall not automatically be
waived pursuant to the provisions of the immediately foregoing sentence. If a
Creditor is taking Enforcement Action against Collateral in accordance with the
terms and provisions of this Agreement, premised on the existence of one or more
Events of Default, and if all such Events of Default are waived, then such
Creditor promptly shall suspend further Enforcement Action; provided however,
that such Creditor will not be required to do so if it might incur liability or
it might breach commitments it already has entered into in connection with such
Enforcement Action (such as, by way of illustration, but not by way of
limitation, enforceable agreements to dispose of Collateral).
9. UCC Notices. In the event that any Creditor shall be
required by the UCC or any other applicable law to give any notice to the other
Creditor, such notice shall be given in accordance with Section 21 hereof and 5
Business Days notice shall be conclusively deemed to be commercially reasonable.
Any notice given pursuant to this section is agreed to comply with the timing
and addressing requirements of Sections 9504 and 9505 of the UCC. To the extent
that any Creditor is entitled by Sections 9504 or 9505 of the UCC to request
notice from any other Creditor, this Section 9 constitutes such a request.
10. Independent Credit Investigations. No Creditor nor any of
its respective directors, officers, agents, employees, attorneys, shareholders,
or professionals shall be responsible to any other Creditor or to any other
person or entity for Debtor's solvency,
18
19
creditworthiness, financial condition, or ability to repay any of the Claims or
for the accuracy of any recitals, statements, representations, or warranties of
Debtor, oral or written, or for the validity, sufficiency, enforceability, or
perfection of the Claims or the Financing Documents, or any security interests
or liens granted by Debtor to any Creditor in connection therewith. Each
Creditor has entered into its respective Financing Documents with Debtor based
upon its own independent investigation, and makes no warranty or representation
to the other Creditor, nor does it rely upon any representation of the other
Creditor with respect to matters identified or referred to in this paragraph.
Neither Creditor shall have any responsibility to the other Creditor for
monitoring or assuring compliance by Debtor with any of Debtor's covenants or
representations made to either Creditor. Without limiting the generality of the
foregoing, either Creditor may perform in accordance with the terms of its
Financing Documents (subject to this Agreement) without regard to whether
Debtor's performance in accordance with the terms thereof might or would
constitute or result in a breach of covenants or representations under the other
Creditor's Financing Documents, and under no circumstances shall any Creditor be
liable to the other for inducing a breach or violation of the other's Financing
Documents by virtue of performing in accordance with the terms of its own
Financing Documents (subject to this Agreement).
11. Non-Avoidability and Perfection of Liens; No Challenge.
The subordinations and relative priorities set forth in this Agreement are
expressly conditioned upon the validity, enforceability, non-avoidability, and
perfection of the security interest to which another security interest is
subordinated or made of equal priority, as the case may be. If the security
interest to which another security interest is subordinated is not valid,
enforceable, or perfected, or is voidable for any reason, then the subordination
provided for herein shall not be effective to the extent of such invalidity,
unenforceability, non-perfection, or avoidability. The Foothill Group agrees for
the benefit of the Bank Group not to challenge or seek to avoid any lien or
security interest of the Bank Group, or the validity, enforceability, priority,
or perfection thereof. The Bank Group agrees for the benefit of the Foothill
Group not to challenge or seek to avoid any lien or security interest of the
Foothill Group, or the validity, enforceability, priority or perfection thereof.
No Creditor will file or join in any motion to substantively consolidate
Insolvency Proceedings of any Obligors without the consent of the other
Creditors.
12. Perfection of Possessory, Etc. Security Interests. For the
limited purpose of perfecting the security interests of the Creditors in those
types or items of Collateral in which a security interest may be perfected by
possession, dominion, or control, including, without limitation, certificated
securities, instruments, money, or deposit accounts, each Creditor hereby
appoints the other as its bailee for the limited purpose of possessing on its
behalf, or exercising dominion or control on its behalf over, any such
Collateral that may come into the possession, dominion, or control of such other
Creditor from time to time, and
19
20
each Creditor agrees to act as the other's bailee for such limited purpose of
perfecting the other's security interest by possession, dominion, or control
through a bailee, provided that neither Creditor shall incur any liability to
the other Creditor by virtue of acting as the other's bailee hereunder, and
either Creditor may relinquish possession, dominion, or control of Collateral in
its possession, dominion, or control without the consent of the other Creditor,
and without incurring liability to the other Creditor, unless there is an
express written agreement to the contrary in effect between the Creditors. To
the extent that any Creditor relinquishes possession, dominion, or control of
Collateral at a time when the other Creditor would be entitled to possession,
dominion, or control over such Collateral, the relinquishing Creditor will
endeavor in good faith to turn over possession, dominion, or control thereof to
the other Creditor (rather than to Debtor), but shall have no liability for any
failure to do so that is not the result of bad faith or willful misconduct.
13. Amendments, Modifications and Increases; Consent to
Foothill Group Financing Documents. Each Creditor may enter into amendments,
modifications, renewals, or extensions of its Financing Documents with Debtor,
or may increase or decrease the credit facilities made available by it to
Debtor, without in any way affecting the rights and obligations of the Creditors
under this Agreement. The Bank Group hereby consents to the execution, delivery,
and performance by the Foothill Group and Debtor of the Foothill Group Financing
Documents. The Foothill Group hereby consents to the execution, delivery, and
performance by the Bank Group and Debtor of the Bank Group Financing Documents.
Should either or both Creditors cease extending further credit to Debtor, this
Agreement nevertheless shall continue in effect as to the outstanding Claims of
each Creditor until this Agreement is terminated as set forth in Section 14
hereof.
14. Termination; Conditional Revival and Reinstatement. This
Agreement is a continuing agreement, and, unless both Creditors have
specifically consented in writing to its earlier termination, this Agreement
shall remain in full force and effect in all respects until the earlier of (a)
such time as the Foothill Group Claims are paid or otherwise satisfied in full,
the Foothill Group has no further commitment to extend credit facilities to
Debtor, and the Foothill Group Agent has released or terminated its security
interest in the Collateral, or (b) such time as the Bank Group Claims are paid
or otherwise satisfied in full, the Bank Group has no commitment to extend
credit facilities to Debtor, and the Bank Group has released or terminated its
security interest in the Collateral. The foregoing notwithstanding, if this
Agreement has terminated, and if a Creditor (for purposes of this Section 14,
the "Disgorging Creditor") thereafter is required to return or disgorge any
payment or transfer received by it such that such Creditor has a revived and
reinstated Claim against Debtor, then, if such Disgorging Creditor gives notice
of such circumstance to the other Creditors, and to the extent that such other
Creditors continue to hold Claims or continue to have commitments to extend
credit facilities to Debtor, this Agreement shall be revived and reinstated
prospectively from
20
21
the time of receipt of such notice, provided that such other Creditors shall
not, as the consequence of such revival and reinstatement: (a) have any
liability as the result of any acts or omissions taken or omitted to be taken
during any period that this Agreement was terminated; or (b) be required to
return, disgorge, or account for any payments or transfers received by them
(whether or not from Collateral) during any period that this Agreement was
terminated.
15. Accountings. Each Creditor agrees, upon the occurrence of
any Enforcement Action, to provide the other Creditor, upon reasonable request,
periodic accountings of the amount of such Creditor's Claims, giving effect to
any applications of realizations upon Collateral.
16. Effect of Bankruptcy. This Agreement shall be and remain
enforceable notwithstanding any bankruptcy or other insolvency proceeding by or
against Debtor.
17. Control of Dispositions of Collateral and Effect thereof
on Junior or Equal Priority Security Interests.
(a) Notwithstanding any provision, term, or condition to the
contrary contained in the Bank Group Financing Documents or the Foothill Group
Financing Documents, so long as no Event of Default has occurred and is
continuing or would result from giving effect to such Sale, and subject to the
Minimum Availability Condition (except to the extent, if any, that such
condition is waived by the Foothill Group in its sole and absolute discretion
and except that the Minimum Availability Condition shall not be applicable to
Sales by Debtor pursuant to Section 17(a)(ii) of this Agreement), the Creditors
each agree for their mutual benefit that Debtor shall be entitled to make Sales
of the Fixed Assets composing the Collateral subject to the following terms and
conditions and so long as the Net Sale Consideration from such Sales of Fixed
Assets is distributed as follows:
(i) The consideration for each such Sale shall be all
cash; provided, however, in the event that the Net Sales Consideration
received in any such Sale is in excess of $15,000,000, the consideration
for such Sale may consist of (y) cash, and (z) promissory notes (each
such note a "Purchaser Note") in an aggregate principal amount not to
exceed the lesser of:
(A) 50% of the aggregate proceeds received in
such Sale; or
(B) the aggregate Net Sale Consideration
received in connection with such Sale minus
the aggregate OLV of the assets subject to
such Sale;
21
22
provided, further, that (x) subject to subsection 17(a)(v), each such
Purchaser Note shall be pledged to the Bank Group Agent for the benefit
of the Bank Group and the Foothill Group Agent for the benefit of the
Foothill Group, (y) if more than one person is purchasing assets in any
Sale in which one or more Purchaser Notes are issued, each such Person
shall be jointly and severally liable on each such Purchaser Note, and
(z) the creditworthiness of the issuer(s) of any such Purchaser Notes
and the terms of any such Purchaser Notes shall be reasonably
satisfactory to the Creditor(s), as applicable, entitled to receive the
pledge of such Purchaser Note(s).
(ii) With respect to any Sale of Fixed Assets that
compose Akashic Foreign Collateral, StorMedia Foreign Collateral, or
StorMedia Domestic Collateral, Debtor shall apply the proceeds of any
such Sale to the prepayment of the Bank Group Claims in the following
amounts:
(A) in the case of any Above OLV Sale, the
prepayment shall be in an amount equal to
the lesser of (1) the Net Sale Consideration
for such Sale, and (2) the sum of (a) the
Minimum Prepayment Amount, plus (b) the
Excess Prepayment Amount[, plus (c) if the
Prepayment Carryforward is then a negative
number, an amount equal to the absolute
value of the Prepayment Carryforward]; and
(B) in the case of any Below OLV Sale, the
prepayment shall be in an amount equal to
the greater of (1) the Minimum Prepayment
Amount minus the aggregate amount of the
Prepayment Carryforward (if a positive
number) at the time of the Sale, and (2) the
Net Sale Consideration for such Sale. Unless
the Bank Group Agent and each of the members
of the Bank Group have otherwise consented
thereto, Debtor may not commit to enter
into, or consummate, a Below OLV Sale if,
after giving effect to such Below OLV Sale
and any prepayment made to the Bank Group
Agent for the benefit of the Bank Group in
connection therewith, the Prepayment
Carryforward would be a negative number.
(C) If the consideration for any such Sale is
permitted to consist of Purchaser Notes
pursuant to clause (i) of this
22
23
subsection 17(a), then up to 50% of the
amount payable to the Bank Group pursuant to
clause (ii) of this subsection 17(a) may
consist of Purchaser Notes; provided,
however, that:
(1) the issuer(s) of Purchaser Notes
shall issue two such Purchaser Notes
each equal to one-half of the amount
to be evidenced by Purchaser Notes;
(2) Debtor shall irrevocably instruct the
issuer(s) of Purchaser Notes in such
Sale to make payments on one such
note directly to the Bank Group Agent
for the benefit of the Bank Group;
(3) so long as there is no Bank Group
Event of Default, payments under the
other Purchaser Note issued in such
Sale may be made directly to Debtor;
(4) anything contained in Section 3
hereof to the contrary
notwithstanding, after the occurrence
of a Bank Group Event of Default,
upon notice from the Bank Group
Agent, the issuer(s) of such other
Purchaser Note(s) shall be
irrevocably instructed to make
payments on all such other Purchaser
Note(s) directly to the Bank Group
Agent for the benefit of the Bank
Group;
(5) any such payments made to the Bank
Group Agent shall be applied to the
prepayment of the Bank Group Claims
in accordance with the provisions of
the Bank Group Agreement; and
(6) the principal amount of any Purchaser
Note shall not be included in the
calculation of the Prepayment
Carryforward or the Carryforward
Reduction Amount.
(iii) With respect to any Sale of Fixed Assets that
compose Akashic Domestic Collateral (other than the Tasman Facility),
Debtor shall
23
24
retain or apply the proceeds of any such Sale to the prepayment of the
Bank Group Claims and the Foothill Group Claims in the following
amounts:
(A) Debtor may retain the first $7,000,000 in
net cash proceeds from any such Sale and use
the same for any lawful general corporate
purpose; and
(B) to the extent that the net cash proceeds of
all such Sales of Akashic Domestic
Collateral are in excess of $7,000,000,
Debtor shall make a mandatory prepayment of
the Bank Group Claims in accordance with the
provisions of the Bank Group Agreement in an
amount equal to 50% of such excess. The
remaining 50% shall be paid to the Foothill
Group Agent for application to the Foothill
Group Claims.
(iv) With respect to any Sale of Fixed Assets that
compose the Tasman Facility portion of the Akashic Domestic Collateral,
Debtor shall apply the proceeds of any such Sale to the prepayment of
the Bank Group Claims and the Foothill Group Claims in accordance with
the provisions of the Bank Group Agreement and the Foothill Group
Agreement in the following order:
(A) Debtor shall make a mandatory prepayment of
the Foothill Group Claims in the amount, if
any, required to be prepaid under the
Foothill Group Agreement as a result of such
Sale (which may be the entire such amount);
(B) Debtor shall make a mandatory prepayment of
the Bank Group Claims in accordance with the
provisions of the Bank Group Agreement in an
amount equal to 50% of the Net Sale
Consideration of any such Sale, if any,
remaining after making any prepayment
required by subsection 17(a)(iv)(A); and
(C) Debtor may retain the remainder of any such
proceeds from any such Sale, if any, and use
the same for any lawful general corporate
purpose.
24
25
(v) To the extent that the consideration for any
Permitted Sale is paid in the form of Purchaser Notes in accordance with
subsection 17(a)(i), such Purchaser Notes shall be issued as follows;
(A) with respect to Purchaser Notes that are
proceeds of Foothill Group Priority
Collateral:
(1) to the extent such proceeds would
have been payable to the Bank Group
if received in cash, a Purchaser Note
for such amount shall be payable
directly to the Bank Group Agent for
the benefit of the Bank Group and
such Purchaser Note shall be pledged
to the Bank Group Agent; and
(2) to the extent such proceeds would
have been payable to the Foothill
Group or to Debtor, a Purchaser Note
for such amount shall be payable to
the Debtor and pledged to the
Foothill Group Agent, with any
payments or collections thereon to be
applied in accordance with the terms
of the Foothill Group Financing
Documents; and
(B) with respect to Purchaser Notes that are
proceeds of Bank Group Priority Collateral:
(1) to the extent such proceeds would
have been payable to the Bank Group
if received in cash, a Purchaser Note
for such amount shall be payable
directly to the Bank Group Agent for
the benefit of the Bank Group and
such Purchaser Note shall be pledged
to the Bank Group Agent; and
(2) to the extent such proceeds would
have been payable to the Debtor, a
Purchaser Note for such amount shall
be payable to Debtor and pledged to
the Bank Group Agent, with any
payments or collections thereon to be
applied in accordance with the terms
of the Bank Group Financing
Documents, provided that, until the
Bank Group Agent notifies the obligor
under such Purchaser
25
26
Note that a Bank Group Event of
Default has occurred, any payments
with respect thereto shall be treated
the same as "Collections" under the
Foothill Group Loan Agreement and
shall be directed into and through
the "Lockboxes" provided for therein.
(vi) The principal amount of any Purchaser Note shall
not be included in the calculation of the Prepayment Carryforward or the
Carryforward Reduction Amount.
(vii) To the extent of any disposition of Collateral
governed by and made in compliance with subsection 17(a), each Creditor
agrees to release its security interest in the Collateral being sold
concurrent with the sale thereof.
(viii) Anything to the contrary in Section 17(a)(iii) or
(iv) notwithstanding, Debtor must obtain the prior consent of the
Foothill Group to effect a Sale of Domestic Collateral consisting of
Fixed Assets of Akashic, except that such consent shall not be required
for Sales: (A) not to exceed $2,000,000 of Foothill OLV in the aggregate
of Fixed Assets with individual with Foothill OLV of less than or equal
to $250,000; or (B) with Net Sale Consideration of at least 70% of the
Foothill OLV of the Fixed Assets being sold.
(b) Subject to Section 17(c) hereof, and subject to the
Malaysian Exception, all other dispositions of any Collateral not the subject of
the provisions of Section 17(a) shall be subject to the following provisions:
(i) Each Creditor hereby agrees that, as of any date of
determination and with respect to any Collateral: (A) if the Creditor
with the senior security interest in such Collateral (other than the
Equal Priority Collateral) shall have agreed with Debtor that Debtor may
sell such Collateral, then the security interest of the other Creditor
in such Collateral shall be released by such other Creditor concurrently
with such sale or other disposition and, except as otherwise agreed by
the Creditors, the net cash proceeds therefrom shall be applied to the
Claims of the Creditors in the manner provided in Section 3 hereof; and
(B) if any Creditor then permitted hereunder to sell or dispose of the
Equal Priority Collateral shall have agreed with Debtor that Debtor may
sell such Collateral, then the security interest of the other Creditor
in such Collateral shall be released by such other Creditor concurrently
26
27
with such sale or other disposition and, except as otherwise agreed by
the Creditors, the net cash proceeds therefrom shall be applied to the
Claims of the Creditors in the manner provided in Section 3 hereof;
(ii) Each Creditor hereby further agrees that: (A) any
UCC collection, sale, or other disposition of Foothill Group Priority
Collateral by the Foothill Group Agent shall be free and clear of any
security interest, lien, claim or offset of the Bank Group in such
Foothill Group Priority Collateral, provided that the Bank Group shall
retain a junior security interest and lien on the proceeds of such
collection, sale, or other disposition (except to the extent such
proceeds are applied to the Foothill Group Claims or, with the consent
of the Creditors, are used by Debtor for general corporate purposes as
set forth in subsection (i) of this Section 17(b)); (B) any UCC
collection, sale, or other disposition of the Bank Group Priority
Collateral by the Bank Group shall be free and clear of the junior
security interest of the Foothill Group in such Bank Group Priority
Collateral, provided that the Foothill Group shall retain a junior
security interest and lien on the proceeds of such collection, sale, or
other disposition (except to the extent such proceeds are applied to the
Bank Group Claims or, with the consent of the Creditors, are used by
Debtor for general corporate purposes as set forth in subsection (i) of
this Section 17(b)); and (C) any UCC collection, sale, or other
disposition of Equal Priority Collateral by either Creditor then
permitted hereunder to sell or dispose of the Equal Priority Collateral
shall be free and clear of the equal priority security interest of the
other Creditor in such Equal Priority Collateral, provided that such
other Creditor shall retain an equal priority security interest and lien
on the proceeds of such collection, sale, or other disposition; and
(iii) To the extent reasonably requested by either
Creditor, the other Creditor will cooperate in providing any necessary
or appropriate releases to permit a collection, sale, or other
disposition of Collateral, as provided in subsections (i) or (ii) of
this Section 17(b), by the Creditor holding the senior security interest
therein free and clear of the other Creditor's junior security interest
or by the Creditor conducting the collection, sale, or other disposition
of the Equal Priority Collateral (as permitted by the provisions hereof)
free and clear of the other Creditor's equal priority security interest
therein (except as to the proceeds thereof as set forth herein).
(c) Special Rules for Stock Sales. Subject to the Malaysian
Exception, the Foothill Group Agent may make, or permit to be made by an
Obligor, a Stock Sale of the Stock of any Foothill Group Priority Subsidiary,
either with the consent of the Obligor that
27
28
owns such Stock, or without such consent pursuant to the lawful exercise of its
rights as a secured creditor, in either case without the consent of the Bank
Group, so long and only so long as, unless the Creditors agree otherwise, the
related Stock Sale Consideration is at least equal to the Relevant Minimum
Price, and so long and only so long as, unless the Creditors agree otherwise,
such Stock Sale Consideration is applied as set forth below. In connection with
any such Stock Sale referred to in the preceding sentence, the Bank Group Agent
shall release its security interests and liens on any Relevant Released
Collateral related to such Stock Sale, shall release any guaranties from the
Person whose Stock is the subject of such Stock Sale, or any Subsidiary of such
Person, and the Stock Sale Consideration shall be paid, first, to the Foothill
Group Agent for the benefit of the Foothill Group, to the extent of the Agreed
Asset Value of the Accounts and Inventory, if any, that are included within the
Relevant Released Collateral, second, to the Bank Group Agent for the benefit of
the Bank Group, to the extent of the Agreed Asset Value of the Fixed Assets
other than Akashic Domestic Collateral, if any, that are included within the
Relevant Released Collateral, third, to the Foothill Group Agent for the benefit
of the Foothill Group to the extent of the lesser of any such remaining proceeds
and the Agreed Asset Value of the Fixed Assets consisting of Akashic Domestic
Collateral, if any, included within the Relevant Released Collateral, and,
fourth, if there are any remaining proceeds, divided equally (50/50) among the
Foothill Group Agent for the benefit of the Foothill Group and the Bank Group
Agent for the benefit of the Bank Group. The Bank Group Agent may make, or
permit to be made by an Obligor, a Stock Sale of the Stock of any Bank Group
Priority Subsidiary, either with the consent of the Obligor that owns such
Stock, or without such consent pursuant to the lawful exercise of its rights as
a secured creditor, in either case without the consent of the Foothill Group, so
long and only so long as, unless the Creditors agree otherwise, the related
Stock Sale Consideration is at least equal to the Relevant Minimum Price, and so
long and only so long as, unless the Creditors agree otherwise, such Stock Sale
Consideration is applied as set forth below. In connection with any such Stock
Sale referred to in the preceding sentence, the Foothill Group Agent shall
release its security interests and liens on any Relevant Released Collateral
related to such Stock Sale, shall release any guaranties from the Person whose
Stock is the subject of such Stock Sale, or any Subsidiary of such Person, and
the Stock Sale Consideration shall be paid, first, to the Foothill Group Agent
for the benefit of the Foothill Group, to the extent of the Agreed Asset Value
of the Accounts and Inventory, if any, that are included within the Relevant
Released Collateral, second, to the Bank Group Agent for the benefit of the Bank
Group, to the extent of the lesser of any such remaining proceeds and the Agreed
Asset Value of the Fixed Assets, if any, that are included within the Relevant
Released Collateral and, third, if there are any remaining proceeds, divided
equally (50/50) among the Foothill Group Agent for the benefit of the Foothill
Group and the Bank Group Agent for the benefit of the Bank Group.
28
29
18. Construction. Unless the context of this Agreement clearly
requires otherwise, references to the plural include the singular, the singular
includes the plural, the part includes the whole, "including" is not limiting,
and "or" has the inclusive meaning represented by the phrase "and/or." The words
"hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement
refer to this Agreement as a whole and not to any particular provision of this
Agreement. Section references are to this Agreement unless otherwise specified.
19. Modifications in Writing. No amendment, modification,
supplement, termination, consent, or waiver of or to any provision of this
Agreement nor any consent to any departure therefrom shall in any event be
effective unless the same shall be in writing and signed by or on behalf of the
Creditors. Any waiver of any provision of this Agreement, or any consent to any
departure from the terms of any provisions of this Agreement, shall be effective
only in the specific instance and for the specific purpose for which given.
20. Waivers; Failure or Delay. No failure or delay on the part
of either Creditor in the exercise of any power, right, remedy, or privilege
under this Agreement shall impair such power, right, remedy, or privilege or
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such power, right, or privilege preclude any other or further exercise of
any other power, right, or privilege. The waiver of any such right, power,
remedy, or privilege with respect to particular facts and circumstances shall
not be deemed to be a waiver with respect to other facts and circumstances.
21. Notices. All notices hereunder shall be effective upon
receipt, shall be in writing, and shall be sent by U.S. mail, Federal Express
overnight courier (or the equivalent), hand delivery by a reputable and reliable
professional courier service, mailgram, telefacsimile, telegram, or telex as
follows:
If to
the Foothill
Group: X/X XXXXXXXX XXXXXXX XXXXXXXXXXX
00000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Business Finance Division Manager
Telecopier: 310.478.9788
29
30
With a
copy to: XXXXXXX, PHLEGER & XXXXXXXX LLP
000 X. Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
Telecopier: 213.239.1324
If to the
Bank Group: x/x XXXXXXXX XXXX XX XXXXXXXX,
XXX XXXX AGENCY, as the Bank Group Agent
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxxxx
Telecopier: 212.856.4135
With a
copy to: SIDLEY & AUSTIN
000 Xxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000-0000
Attn: Xxxxxxxx X. Xxxxx, Esq.
Telecopier: 213.896.6600
The parties hereto may change the address at which they are to
receive notices hereunder, by notice in writing in the foregoing manner given to
the other. The failure to send a copy of notice to the individuals who are shown
above as being required to receive copies shall not invalidate or otherwise
affect the validity of a notice that is otherwise effectively given. All notices
or demands sent in accordance with this section shall be deemed received on the
earlier of the date of actual receipt or 5 days after the deposit thereof in the
mail.
22. Notice of Unwaived Events of Default and Acceleration. The
Foothill Group Agent and the Bank Group Agent shall each endeavor, in good
faith, to provide each other with notice (in accordance with the notice
provisions hereof) of the acceleration of the Foothill Group Claim or the Bank
Group Claim, as the case may be, or of the existence of unwaived Events of
Defaults under their respective Financing Documents; provided, however, that
neither the Foothill Group Agent nor the Bank Group Agent shall suffer any
liability whatsoever for any failure (other than a willful failure) to send such
notification.
30
31
23. Headings. Section headings used in this Agreement are for
convenience of reference only and shall not constitute a part of this Agreement
for any purpose or affect the construction of this Agreement.
24. No Benefit to Third Parties. The terms and provisions of
this Agreement shall be for the sole benefit of the Foothill Group and the Bank
Group and their respective successors and assigns, and no other person or entity
(including Debtor) shall have any right, benefit, priority, or interest under,
or because of this Agreement, except that Debtor is a third party beneficiary of
Section 17(a) and Section 17(c) only.
25. Counterparts; Telecopy Execution. This Agreement may be
executed in any number of counterparts, each of which shall be deemed to be an
original, admissible into evidence, and all of which together shall be deemed to
be a single instrument. Delivery of an executed counterpart of this Agreement by
telefacsimile shall be equally as effective as delivery of a manually executed
counterpart of this Agreement. Any party delivering an executed counterpart of
this Agreement by telefacsimile shall also deliver a manually executed
counterpart of this Agreement but the failure to deliver a manually executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement.
26. Severability of Provisions. Any provision of this
Agreement which is illegal, invalid, prohibited, or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such illegality, invalidity, prohibition, or unenforceability without
invalidating or impairing the remaining provisions hereof or affecting the
validity or enforceability of such provision in any other jurisdiction.
27. Complete Agreement. This Agreement is intended by the
parties as a final expression of their agreement and is intended as a complete
statement of the terms and conditions of their agreement. This Agreement shall
not be modified except in a writing signed by the party to be charged, and may
not be modified by conduct or oral agreements.
28. Representations and Warranties of the Bank Group Agent.
The Bank Group Agent hereby represents and warrants to the Foothill Group that:
(a) each Bank has authorized and directed the Bank Group Agent to enter into
this Agreement on behalf of the Bank Group; and (b) each Bank has agreed that
any action taken by the Bank Group Agent, in accordance with the terms of this
Agreement, and the exercise by the Bank Group Agent of its powers set forth in
this Agreement, together with such other powers that are reasonably incidental
thereto, shall be binding upon the Bank Group.
29. Representations and Warranties of the Foothill Group
Agent. The Foothill Group Agent hereby represents and warrants to the Bank Group
that: (a) each lender
31
32
that is signatory to the Foothill Group Financing Documents has authorized and
directed the Foothill Group Agent to enter into this Agreement on behalf of the
Bank Group; and (b) each lender that is signatory to the Foothill Group
Financing Documents has agreed that any action taken by the Foothill Group
Agent, in accordance with the terms of this Agreement, and the exercise by the
Foothill Group Agent of its powers set forth in this Agreement, together with
such other powers that are reasonably incidental thereto, shall be binding upon
the Foothill Group.
30. Successors and Assigns. This Agreement is binding upon and
inures to the benefit of the successors and assigns of each Creditor. Each
Creditor agrees to maintain a copy of this Agreement together with its copies of
the Financing Documents relating to its Claims. Each Creditor expressly reserves
its right to transfer or assign its Claims, in whole or in part, together with
its rights hereunder, provided that, prior to transferring or assigning any
interest in its Claims to any Person, each Creditor shall disclose to such
Person the existence and contents of this Agreement, shall provide to such
Person a complete and legible copy hereof, shall advise such Person that such
Creditor's security interest in the Collateral is subject to the terms hereof,
and shall require such Person to agree in writing to be bound hereby. Should any
Creditor transfer its Claims, or should such Claims be refinanced, it is
intended that this Agreement will bind successors and assigns of the parties.
Should it become necessary or desirable, however, to re-sign a new agreement
containing substantive terms equivalent to those of this Agreement in all
material respects (although the form of such new agreement or the parties
thereto may be different), to reflect such a realignment of parties, each of the
Creditors and their respective successors and assigns agrees to execute such a
new agreement if requested to do so.
31. Attorneys Fees and Disbursements. In the event of any
dispute concerning the meaning or interpretation of this Agreement that results
in litigation, or in the event of any litigation by a party to enforce the
provisions hereof, the prevailing party shall be entitled to recover from the
non-prevailing party its reasonable attorneys fees and disbursements, and any
actual court costs incurred.
32. Release of Collateral. Creditors agree that either
Creditor may release or refrain from enforcing its security interest in any
Collateral, or permit the use or consumption of such Collateral by Debtor free
of such Creditor's security interest, without incurring any liability to the
other Creditor. The foregoing shall not, however, be deemed to affect the other
Creditor's rights hereunder.
33. GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN
MADE IN THE STATE OF CALIFORNIA AND THE VALIDITY OF THIS AGREEMENT, AND THE
CONSTRUCTION, INTERPRETATION, AND
32
33
ENFORCEMENT HEREOF, AND THE RIGHTS OF THE PARTIES HERETO RELATING TO CLAIMS OR
CAUSES OF ACTION ARISING IN CONNECTION HEREWITH SHALL BE DETERMINED UNDER,
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA.
34. WAIVER OF TRIAL BY JURY. THE CREDITORS, AND EACH OF THEM,
TO THE FULLEST EXTENT THEY MAY LEGALLY DO SO, HEREBY KNOWINGLY, EXPRESSLY, AND
VOLUNTARILY WAIVE AND RELINQUISH ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION, CAUSE OF ACTION, OR PROCEEDING ARISING UNDER OR WITH RESPECT TO
THIS AGREEMENT, OR IN ANY WAY CONNECTED WITH, OR RELATED TO, OR INCIDENTAL TO,
THE DEALINGS OF THE PARTIES HERETO WITH RESPECT TO THIS AGREEMENT OR THE
TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND IRRESPECTIVE OF WHETHER SOUNDING IN CONTRACT, TORT, OR
OTHERWISE. TO THE FULLEST EXTENT THEY MAY LEGALLY DO SO, THE CREDITORS HEREBY
AGREE THAT ANY SUCH CLAIM, DEMAND, ACTION, CAUSE OF ACTION, OR PROCEEDING SHALL
BE DECIDED BY A COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY HERETO MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE OTHER PARTY OR PARTIES HERETO TO WAIVER OF ITS OR
THEIR RIGHT TO TRIAL BY JURY.
35. Seagate Disgorgement. If Seagate Technology, Inc. turns
over to any Creditor any payment pursuant to the turnover provisions of the
subordination agreement executed by it in favor of the Creditors, the receiving
Creditor will notify the other Creditor and such amount will be divided in
accordance with the priorities herein to the extent the source thereof can be
identified, and otherwise as if the source thereof was Equal Priority
Collateral.
[remainder of page intentionally left blank]
33
34
IN WITNESS WHEREOF, the Creditors have entered into this Agreement as of
the date first set forth above, intending to be legally bound hereby.
FOOTHILL CAPITAL CORPORATION, as
the Foothill Group Agent for
the benefit and on behalf
of the Foothill Group
By: /s/
--------------------------------
Name:
Title:
CANADIAN BANK OF COMMERCE,
NEW YORK AGENCY, as the Bank Group
Agent for the benefit and on
behalf of the Bank Group
By: /s/
--------------------------------
Name:
Title:
X-0
00
Xxxxxxx, Xxxxxxxxxxxxxxx, and Agreement to be Bound
Each Debtor has received a copy of, and has read, the foregoing Intercreditor
Agreement. Each Debtor agrees to be bound by such agreement, and not to take any
action that would breach or violate the terms thereof. Each Debtor consents to
the execution, delivery, and performance of such agreement by the Foothill Group
Agent and the Bank Group Agent, and agrees that each Debtor's obligations to the
Foothill Group and the Bank Group are not altered or diminished by such
agreement. Each Debtor acknowledges that no Debtor has any rights under the
foregoing agreement and is not a third party beneficiary of such agreement,
except with respect to Sections 17(a) and 17(c) thereof. Each Debtor, by its
signature below, represents and warrants that it has the power and authority to
bind not only itself but also each and every one of its present and future
direct and indirect Subsidiaries, and intends to do so by its signature hereon.
Dated as of the date first set forth above:
StorMedia Incorporated, a Delaware corporation, on behalf of itself, and on
behalf of each and every one of its direct and indirect Subsidiaries
By: /s/
--------------------------------
Name:
Title:
StorMedia International, Ltd., a company organized under the laws of the Cayman
Islands, on behalf of itself, and on behalf of each and every one of its direct
and indirect Subsidiaries
By: /s/
--------------------------------
Name:
Title:
S-2
36
Strates Pte. Ltd., a company organized under the laws of Singapore, on behalf of
itself, and on behalf of each and every one of its direct and indirect
Subsidiaries
By: /s/
--------------------------------
Name:
Title:
StorMedia Foreign Sales Corporation, a U.S. Virgin Islands corporation, on
behalf of itself, and on behalf of each and every one of its direct and indirect
Subsidiaries
By: /s/
--------------------------------
Name:
Title:
Akashic Memories Corporation, on behalf of itself, and on behalf of each and
every on e of its direct and indirect Subsidiaries
By: /s/
-------------------------------
Name:
Title:
Strates Sdn. Bhd., a company organized under the laws of Malaysia, and on behalf
of each and every one of its direct and indirect Subsidiaries
By: /s/
-------------------------------
Name:
Title:
S-3
