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EXHIBIT 10.4
CONSIGNMENT AGREEMENT
CONSIGNMENT AGREEMENT ("Agreement") made as of October 20, 1995, by and between
UNION BANK OF SWITZERLAND, with its principal office at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 ("Consignor"), and XXXXXXX XXXXXXX JEWELERS, INC., a
Delaware corporation with its principal office at 000 Xxxxx XxxXxxxxxx Xxxxxxx,
Xxxxx Xxxxxx, Xxx Xxxx 00000 ("Consignee").
Consignee has requested Consignor to deliver Precious Metal (as defined herein)
on consignment for sale to Consignee. To effectuate this arrangement,
Consignor and Consignee agree that the Consignment Agreement governing this
agreement is stated as follows:
1. DEFINITIONS.
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For the purposes of this Agreement:
"Base Rate" shall mean the higher of (i) the base commercial lending rate
announced from time to time by Union Bank of Switzerland, New York Branch, or
(ii) the rate quoted by Union Bank of Switzerland, New York Branch, at
approximately 11:00 am, New York City time, to dealers in the New York Federal
Funds Market for the overnight offering of dollars by Union Bank of
Switzerland, New York Branch, for deposit, plus one-half of the percent (1/2%).
"Consignee's Counsel" shall mean Benesch, Friedlander, Xxxxxx and Xxxxxxx.
"Consigned Precious Metal" shall mean Precious Metal which Consignor has
consigned to Consignee pursuant to the terms of this Agreement for which
payment has not been received or which has not been Redelivered to Consignor.
"Consignment Fees" shall mean the outstanding total of fees agreed to (based on
specified quantities and time periods) by Duly Authorized Officers of both
parties at the time of each Delivery of Consigned Precious Metal.
"Consignment Limit" shall mean the lesser of (a) 25,000 xxxx ounces of fine
gold, or (b) Consigned Precious Metal with a Fair Market Value (or unpaid
Purchase Price in the case of Consigned Precious Metal for which the Purchase
Price has been agreed but payment has not been received by Consignor) equal to
$10,000,000.
"Current Liabilities" shall mean, at any date as of which the amount thereof
shall be determined, all amounts that should, in accordance with generally
accepted accounting principles, be included as current liabilities on the
balance sheet of Consignee as at such date, plus, to the extent not already
included therein, all Indebtedness that is payable upon demand or within one
(1) year from the date of determination thereof unless such Indebtedness is
renewable or extendible at the
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"Deliver" or "Delivery" shall mean either actual shipment, creating the right
in Consignee to demand actual shipment through a writing, instrument or a
statement of account, or Consignor's crediting Precious Metal to the account of
Consignee with one or more third parties when no physical movement thereof is
contemplated by the parties.
"Duly Authorized Officer" shall mean the President of Consignee, or other
officer or employee who is authorized by the Board of Directors or an executive
committee of such Board of Directors.
"Environmental Requirement(s)" shall mean any present or future law, statute,
ordinance, rule, regulation, order, code, license, permit, decree, judgment,
directive or the equivalent of or by any Governmental Authority and relating to
or addressing the protection of human health or the environment.
"Event of Default" shall mean an Event of Default under Section 13 of this
Agreement.
"Fair Market Value" on any day shall mean the Second London Gold Fixing for
that day. If no such price is available for a particular day, the Fair Market
Value for such day shall be the price for the immediately preceding day for
which such price is available.
"Financial Statements" shall mean the balance sheet, income statement,
statement of cash flows and stockholder's equity statement of Consignee for the
year or other period then ended, together with supporting schedules, certified
(without qualification) by Deloitte and Touche or other independent public
accountants approved by Consignor and prepared in accordance with generally
accepted accounting principles consistently applied.
"First Insurance Companies" shall mean the companies defined as such in
Subsection 13(m).
"Governmental Authority" shall mean the United States government, any state or
other political subdivision thereof, any agency, court of body of the United
States government, any state or other political subdivision thereof, or any
quasi-governmental agency or authority exercising executive, legislative,
judicial, regulatory or administrative functions.
"Guarantees" shall mean, as applied to Consignee, all guarantees, endorsements
or other contingent or surety obligations with respect to obligations of others
whether or not reflected on the balance sheet of Consignee, including any
obligation to furnish funds, directly or indirectly (whether by virtue of
Partnership arrangements, by agreement to keep-well or otherwise), through the
purchase of goods, supplies or services, or by way of stock purchase, capital
contribution, advance or loan, or to enter into a contract for any of the
foregoing, for the purpose of payment of obligations of any other person or
entity.
"Hazardous Material" shall mean any material or substance (i) which, whether by
its nature or use, is now or hereafter defined as a hazardous waste, hazardous
substance, pollutant or contaminant under any Environmental Requirement, (ii)
which is toxic, explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise hazardous to human
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health or the environment, (iii) which is or contains petroleum or any fraction
thereof, including crude oil. heating oil, gasoline or diesel fuel, or (iv) the
presence of which requires investigation or remediation under any Environmental
Requirement.
"Indebtedness" shall mean, as applied to Consignee, (i) all obligations for
borrowed money or other extensions of credit whether or not secured or
unsecured, absolute or contingent, including, without limitation, unmatured
reimbursement obligations with respect to letters of credit or guarantees
issued for the account of or on behalf of Consignee and all obligations
representing the deferred purchase price of property, other than accounts
payable arising in the ordinary course of business, (ii) all obligations
evidenced by bonds, notes, debentures or other similar instruments, (iii) all
obligations secured by any mortgage, pledge, security interest or other lien on
property owned or acquired by Consignee whether or not the obligations secured
thereby shall have been assumed, including but not limited to obligations to
the First Insurance Companies, the Second Insurance Companies and the Third
Insurance Companies, (iv) that portion of all obligations arising under capital
leases that is required to be capitalized on the balance sheet of Consignee,
(v) all Guarantees, (vi) all obligations with respect to Precious Metal leased
or consigned to consignee, including but not limited to obligations pursuant to
this Agreement, and (vii) all obligations that are immediately due and payable
out of the proceeds of or production from property now or hereafter owned or
acquired by Consignee.
"Notice" or "Notices" shall mean all requests, demands and other
communications, in writing (including telegraphic and telecopy communications),
sent by registered or certified mail, return receipt requested, overnight
delivery service, telegraph, facsimile transmission or hand-delivery to the
other party at that party's Principal Office.
"Precious Metal" shall mean gold having a fineness of not less than .9995
without regard to whether such gold is alloyed or unalloyed, in bullion form or
is contained in or processed into other materials which contain elements other
than gold.
"Principal Office" shall mean:
FOR CONSIGNOR:
Union Bank of Switzerland
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxxxxx
Fax Number: 000-000-0000
FOR CONSIGNEE:
Xxxxxxx Xxxxxxx Jewelers, Inc.
000 Xxxxx XxxXxxxxxx Xxxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxx, Senior
Vice President and Treasurer
Fax Number: 000-000-0000
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"Purchase Price" shall mean a price to which both parties' Duly Authorized
Officers agree and shall be stated in dollars per xxxx ounce of Precious Metal
content.
"Redeliver" or "Redelivery" shall mean that Consignee deliver to Consignor's
Principal Office or as otherwise directed by Consignor, at Consignee's sole
risk and expense, Precious Metal of a fineness equal to the fineness specified
for that Precious Metal and of a type and quality and in a form acceptable to
consignor.
"Second Insurance Companies" shall mean the companies defined as such in
Subsection 13(m).
"Security Agreement" shall mean that certain Amended and Restated Security
Agreement dated as of the date hereof, among Consignor, Rhode Island Hospital
Trust National Bank, individually and as agent ("RIHT"), ABN AMRO Bank N.V.,
New York Branch ("ABN"), Fleet Precious Metals Inc. ("FPM"), Fleet National
Bank ("FNB"), The Mocatta Group, a Division of Standard Chartered Bank
("Mocatta"), Credit Suisse ("CS"), and Deutsche Bank Sharps Xxxxxx Inc..
"Tangible Net Worth" shall mean, at any date as of which the amount
thereof shall be determined, the total assets of Consignee MINUS (i) the sum of
any amounts attributable to (a) goodwill, (b) intangible items such as
unamortized debt discount and expense, patents, trade and service marks and
names, customer lists, copyrights and research and development expenses except
prepaid expenses, (c) all reserves not already deducted from assets, (d) to the
extent not otherwise approved in advance by Consignor, any write-up in the book
value of assets resulting from any revaluation thereof subsequent to the
December 31, 1992 Financial Statements, (e) the value of any minority interests
in any subsidiaries and (f) amounts and loans due from affiliates and/or
officers of Consignee, and (ii) Total Liabilities.
"Third Insurance Companies" shall mean the companies defined as such
in Section 13(m).
"Total Liabilities shall mean, at any date as of which the amount
thereof shall be determined, all obligations that should, in accordance with
generally accepted accounting principles consistently applied, be classified as
liabilities on the balance sheet of Consignee, including in any event all
Indebtedness as shown on the balance sheet of Consignee.
"Working Capital" shall mean the excess of Consignee's current assets,
computed in accordance with generally accepted accounting principles
consistently applied, over the sum of Current Liabilities PLUS long-term
Indebtedness secured by current assets (including, but not limited to,
obligations of consignee to the First Insurance Companies, the Second Insurance
Companies and the Third Insurance Companies).
2. AMOUNT OF CONSIGNMENT.
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Provided (i) no notice of election to terminate this Agreement (as
provided in Section 14 hereof) has been given by either party and (ii) no Event
of Default nor any other event which with notice or lapse of time, or both,
would constitute an Event of Default has occurred hereunder, Consignor will
deliver from time to time to Consignee upon its request Precious Metal under
the terms and conditions of this Agreement. In no event will Consignor be
obligated to deliver
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Precious Metal if aggregate amount of xxxx ounces or Fair Market Value of
Precious Metal requested when added to Consigned Precious Metal exceeds
Consignee's Consignment Limit.
If for any reason the number of xxxx ounces or Fair Market Value (or
unpaid Purchase Price in the case of Consigned Precious Metal for which
Purchase Price has been agreed but payment has not been received by Consignor)
of all consigned Precious Metal at any time exceeds Consignee's Consignment
Limit, Consignee shall immediately Redeliver to Consignor, or purchase and pay
for, Precious Metal of a quantity, or with a Fair Market Value, sufficient to
eliminate such excess.
Consignor shall provide Consignee with a monthly statement of the
quantity of Consigned Precious Metal (in whatever form) held by Consignee. If
Consignee does not agree with the information reported in the statement,
Consignee shall give notice of such disagreement to Consignor within fifteen
(15) days of the date of receipt of such statement. If Consignee fails to give
Notice to Consignor within the fifteen (15) day period, Consignee shall be
deemed to have affirmed the accuracy of the information reported in the
statement and to have waived any claim Consignee may have by reason of a
dispute as to such statement. On or about March 30 of each year, Consignee
shall provide Consignor with a written confirmation, signed by a duly
authorized Officer of Consignee, of the quantity of Consigned Precious Metal as
of the date of such confirmation. Upon and after the occurrence of an Event of
Default, Consignee shall provide to Consignor on a daily basis written
confirmation, in form acceptable to the Consignor, of the quantity and location
of all Consigned Precious Metal.
Consignee shall give Consignor at least two (2) full business days'
Notice of its requirements for Precious Metal. Consignor shall not be liable
to Consignee if Consignor fails to deliver Precious Metal by reason of an Act
of God or other catastrophe, force majeure, lack of supply, delay in
transportation, war or other hostilities, strike, lockout, epidemic, acts of
government or other public authority, requirements of any regulatory board,
agency or authority, unavoidable casualties or any other causes beyond the
Consignor's control. CONSIGNOR MAKES NO WARRANTY OF MERCHANTABILITY IN RESPECT
TO PRECIOUS METAL CONSIGNED OR SOLD UNDER THIS AGREEMENT NOR OF FITNESS FOR ANY
PARTICULAR PURPOSE NOR ANY OTHER WARRANTIES, EXPRESS OR IMPLIED, except that
Consignor does warrant to Consignee that all Precious Metal will be of the
fineness stated in Section 1 for that Precious Metal.
3. DELIVERY OF PRECIOUS METAL.
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All Deliveries of Precious Metal by Consignor will be made to
Consignee by Consignor crediting an account of Consignee at a third party
supplier of Precious Metal or by delivery at Consignee's Principal Office or
other such location approved by Consignor, such Deliveries to be on terms and
conditions satisfactory to Consignor. At the time of Delivery or crediting,
Consignor shall provide Consignee with particulars of the total quantity of
Precious Metal being Delivered or credited to Consignee. A Duly Authorized
Officer of Consignee receiving any Delivery shall give receipt to Consignor for
the same in a form satisfactory to Consignor. All shipping expenses (including
insurance) shall be borne by Consignee, and such expenses paid or
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incurred by Consignor shall be reimbursed immediately in the same manner as
payments under Section 5 hereof.
4. TITLE
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Title to Consigned Precious Metal shall remain with Consignor and
shall not vest in Consignee until Consignor has received payment for the
Consigned Precious Metal as required by Section 5 of this Agreement. Upon each
Precious Metal Delivery, Consignee shall bear the entire risk of loss, theft,
damage or destruction of the Consigned Precious Metal from any cause
whatsoever, whether or not insured, and Consignee agrees to hold the Consigned
Precious Metal IN TRUST for Consignor and to indemnify and hold harmless
Consignor against any and all liabilities, damages, losses, costs, expenses,
suits, claims, demands or judgments of any nature (including, without
limitation, attorneys' fees and expenses) arising from or connected with any
loss, theft, damage or destruction of the Consigned Precious metal. Consignee
shall execute such financing statements, security agreements and other
documents as Consignor shall request to protect Consignor's interest under the
Uniform Commercial Code.
5. CONFIRMATION AND PAYMENTS.
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Promptly after Consignee requests and Consignor agrees to, through
their respective Duly Authorized Officers, delivery and payment terms for a
specified quantity of Consigned Precious Metal, Consignor shall send Consignee
a telecopy (with signature) confirmation (in the form of Exhibit A attached
hereto) which shall set forth (among other things) the following items: (i)
the type and fineness of Precious Metal, (ii) the quantity of such Precious
Metal and applicable Consignment Fees, (iii) the date on which or the period
within which Delivery and settlement are to be made, and (iv) the manner of
delivery. Absent manifest error, the provisions of each such confirmation
shall be binding and shall supersede any terms hereof not consistent with such
provisions. Consignee agrees to examine each such confirmation and, in the
event of error therein, to notify Consignor of such error by telecopy (with
signature) within one (1) business day after Consignee's receipt thereof
(Consignee being conclusively deemed to have waived any such error in the
absence of such notification). Unless otherwise agreed to not later than two
(2) business days prior to an agreed settlement date, Consignee shall be
obligated to Redeliver or (if a Purchase Price has been agreed upon) purchase
and pay for the specified quantity of Consigned Precious Metal plus all
Consignment Fees related thereto.
Payment of the Purchase Price and all other amounts due by Consignee
to Consignor shall be made in the following manner: (i) by bank wire to the
Federal Reserve Bank of New York for the account of Consignor to the attention
of the Precious Metals Department, ABA Number 000- 000-000, (ii) by Consignee
authorizing Consignor to charge its account with Consignor, or (iii) by other
means which Consignor approves in writing. If Consignor in its discretion
grants payment terms different from the foregoing for a particular purchase,
then the Purchase Price shall not be deemed to be paid in full for the purposes
of this Agreement until all payments under such terms have been made.
Any amount not paid when due under this Agreement shall bear interest
at four percent (4%) in excess of the Base Rate until paid in full (whether or
not this Agreement has been
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terminated), such rate to be a floating rate to be redetermined daily in
accordance with changes in the Base Rate. Such interest shall be paid on
demand in the manner provided above.
6. COMMINGLING; REDELIVERY OF PRECIOUS METAL.
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Consignee may use the Consigned Precious Metal only in the ordinary
course of its business as now conducted. No Consigned Precious Metal shall be
removed from Consignee's Principal Office (except as provided in this Section
or Section 12(i) hereof or as may be agreed upon by the parties hereto) or sold
to any third party prior to the fixing of the Purchase Price for such Consigned
Precious Metal. Notwithstanding a contrary provision in this Section,
Consignee shall have the right, on terms and conditions approved in writing by
Consignor, to remove scrap from its Principal Office for refining in the
ordinary course of its business, it being agreed that all such scrap Consigned
Precious Metal shall be and remain property of Consignor until purchased and
paid for in pursuant to Section 5 hereof.
At any time prior to termination of this Agreement, any or all of the
amount of the Consigned Precious Metal (excluding any Consigned Precious Metal
as to which a Purchase Price has been agreed to under Section 5) may be
Redelivered by Consignee to Consignor.
7. INSURANCE.
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Consignee, at its sole cost and expense shall procure and maintain
property insurance to cover all locations where Consigned Precious Metal will
be located on an all risk form, including flood and earthquake and other such
insurance (including but not limited to, fidelity insurance for all employees,
including officers) with respect to the Consigned Precious Metal as may from
time to time be reasonably required by Consignor. All insurance provided for
in this section shall be effected under valid and enforceable policies, in such
forms and in such amounts as may from time to time be reasonably required by
Consignor, issued by financially sound and responsible insurance companies
which are admitted in the jurisdiction in which the Consigned Precious Metal is
located, or are approved under the applicable states' surplus lines insurance
laws. At least ten (10) days Prior to Consignee's first Delivery of Precious
Metal to Consignee and thereafter not less than fifteen (15) days prior to the
expiration dates of insurance policies theretofore furnished pursuant to this
Agreement, Consignee shall deliver to Consignor copies of all insurance
policies (together with Accord Form 27 (2/84) or other similar forms
satisfactory to Consignor) evidencing the insurance coverage required by
Consignor. All policies of insurance shall provide for thirty (30) days
notification in advance of any cancellation, non-renewal or material change in
policy conditions, including cancellation for non-payment of premium.
All policies of insurance provided for or contemplated by this
Agreement shall name Consignor as an additional insured or loss payee, as its
interests may appear.
All Policies of insurance provided for in this Agreement shall, to the
extent obtainable, contain clauses or endorsements to the effect that:
(a) No act or negligence of Consignee, or anyone acting for
Consignee, which might otherwise result in a forfeiture of such insurance or
any part thereof shall in any way affect the validity or enforceability of such
insurance insofar as Consignor is concerned; and
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(b) Consignor shall not be liable for any premiums or subject to
any assessments on the policies.
Losses under each policy of insurance provided for or contemplated by
this Section shall be adjusted with the insurers and/or underwriters and paid
directly to Consignor and Consignee as their interests may appear. Consignee
shall pay all costs and expenses of collecting or recovering any insurance
proceeds under such policies, including, but not limited to, any and all fees
of attorneys, appraisers and adjusters.
8. TAXES, ETC.; CERTAIN RIGHTS OF CONSIGNOR.
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Consignee will promptly pay any and all taxes, assessments and
governmental charges upon the Consigned Precious Metal prior to the date of any
penalties and prior to the date any liens would attach thereto. Consignee will
not use the Consigned Precious Metal in violation of any statute or ordinance.
Consignor may examine and inspect the Consigned Precious Metal at any time,
wherever located, and Consignee agrees to keep all records relating to the
Consigned Precious Metal at its Principal Office.
At its option, Consignor may discharge taxes, liens, security
interests or other encumbrances at any time levied or placed on the Consigned
Precious Metal (which are not being contested in good faith), may pay for
insurance on the Consigned Precious Metal and may pay for the maintenance and
preservation of the Consigned Precious Metal. Consignee agrees to reimburse
Consignor on demand for any payment made, or any excuse incurred, by Consignor
in connection with the forgoing, together with interest thereon at the Base
Rate plus four percent (4%), computed from the date of such payment or expense
until paid.
9. REPRESENTATIONS AND WARRANTIES.
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The following representations and warranties shall survive the
delivery of this Agreement and the Delivery of Precious Metal by Consignor to
Consignee. Consignee represents and warrants to Consignor that:
(a) Consignee has heretofore furnished to Consignor Consignee's
Financial Statements which fairly present the financial condition of Consignee
as of their date, and the results of its operations for the year or other
period then ended in conformity with generally accepted accounting principles
consistently applied. To the best of Consignee's knowledge and belief,
Consignee does not have any contingent obligations, liabilities for taxes or
unusual forward or long-term commitments except as specifically mentioned in
the Financial Statements. Since the date of the Financial Statements, there
has been no material adverse change in the business, prospects, operations,
results or operations, assets, liabilities or condition (financial or
otherwise) of Consignee;
(b) Consignee (i) is duly organized, validly existing and in good
standing under the laws of the state of its incorporation as of the date
hereof, (ii) has full power and authority to own its properties and to carry on
business as now being conducted and is qualified to do business in every
jurisdiction (including the State of New York) where such qualification is
necessary except
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where the failure to so qualify would not have a material adverse effect on the
business or financial condition of Consignee or the Security granted to
Consignor under the Security Agreement or any other security documents and
(iii) has full power to execute, deliver and perform this Agreement, the
Security Agreement and any other documents securing the obligations of
Consignee under this Agreement;
(c) The execution, delivery and performance by Consignee of the
terms and provisions of this Agreement, the Security Agreement and any other
security documents (i) have been duly authorized by all requisite corporate
action, (ii) will not violate any provision of law, any order of any court or
other agency of government, or the corporate charter or by-laws of Consignee,
(iii) will not violate any indenture, agreement or other instrument to which it
is a party, or by which it is bound, or be in conflict with, result in a breach
or constitute (with notice or lapse of time or both) a default under such
agreement, and (iv) except as this Agreement may provide, will not result in
the creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the property or assets of Consignee pursuant to any such
indenture, agreement or instrument;
(d) There is no action, suit or proceeding at law or in equity or
by or before any governmental instrumentality or other agency now pending or,
to the best knowledge of Consignee, threatened against or affecting Consignee,
except as listed on Schedule A attached hereto;
(e) Consignee is not in default in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in any
agreement or instrument to which it is a party where such default, with or
without the passage of time or the giving of notice which would have a material
adverse effect on the business or financial condition of Consignee;
(f) No financing statement or agreement is on file in any public
office pertaining to or affecting any property of Consignee, now owned or
hereafter acquired, except as listed on Schedule B attached hereto;
(g) Consignee has obtained all necessary approvals, permits,
licenses, authorizations and other consents required by, is not in material
violation of, and has performed all of its obligations under, all Environmental
Requirements;
(h) Except as described on Schedule C attached hereto, Consignee
has not received any notice, citation, summons, directive, order or other
communication, written or oral, from, and Consignee has no knowledge, after
reasonable inquiry, of any notice, citation, summons, directive, order or other
communication by, any Governmental Authority or any other person concerning the
presence, generation, treatment, storage, transportation, transfer, disposal,
release or other handling of any hazardous Material within, on, from, related
to, or affecting any real property owned or occupied by Consignee;
(i) To the best of Consignee's knowledge (after reasonable
inquiry) and except as described in Schedule C attached hereto, no real
property owned or occupied by Consignee has ever been used, either by
Consignee, any tenant or any predecessor in interest, to generate, treat,
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store, transport, transfer, dispose of, release or otherwise handle any
Hazardous Material, except in compliance with all Environmental Requirements;
and
(j) No Hazardous Material is currently located within, on, under
or about any real property owned or occupied by Consignee in a manner which
violates any Environmental Requirement, or which requires cleanup or corrective
action of any kind under any Environmental Requirement.
10. CONDITIONS OF CONSIGNMENT.
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Delivery by Consignor of any Precious Metal under this Agreement is
further subject to the following conditions precedent;
(a) The representations an warranties set forth in Section 9 of
this Agreement shall be true and correct on and as of the date of this
Agreement and the date the Delivery is made.
(b) Consignee shall have executed and delivered to Consignor, upon
the execution of this Agreement, the following:
(i) All required security documents, including but not
limited to any and all UCC-1 financing statements
executed by a Duly Authorized Officer of Consignee
as may be required by Consignor;
(ii) A certificate of the Secretary or Assistant Secretary
of Consignee certifying to the votes of Consignee's
Board of Directors authorizing the execution,
delivery and performance of this Agreement and any
security documents,
(iii) A certificate of the Secretary or Assistant Secretary
of Consignee certifying the names of the officers of
Consignee authorized to sign this Agreement, any
security documents and any other documents or
certificates (or any amendments thereto) to be
delivered pursuant to this Agreement (or any
amendments thereto) by Consignee or any of its
officers, together with the true signatures of such
officers, on which certificates Consignor may
conclusively rely until it shall receive a further
certificate canceling or amending the prior
certificate and submitting the signatures of the
offices names in such further certificate;
(iv) A certificate of the Secretary of State of the state
of incorporation of Consignee, dated reasonably near
the date of this Agreement, stating that Consignee is
duly incorporated and in good standing in such state
and has filed all annual reports and has paid all
franchise taxes required to be filed or paid to the
date of such certificate;
(v) A favorable written opinion of Consignee's Counsel,
dated the date of this Agreement, satisfactory to
Consignor and its counsel in scope and substance,
with respect to the matters set forth in subsections
9(b), (c), (d) and (e); and further to the effect
that this Agreement and all required
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security documents have been duly authorized, executed
and delivered by Consignee and constitute the legal,
valid, binding obligations of Consignee enforceable
in accordance with their terms;
(vi) A certificate signed by Consignee's chief
executive or chief financial officer to the
effect stated in (c) above; and
(vii) Such other supporting documents and legal opinions as
Consignor May reasonably request.
11. AFFIRMATIVE COVENANTS.
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Consignee covenants and agrees that, from the date of this Agreement
and until payment and performance in full by Consignee of its indebtedness,
obligations and liabilities to Consignor under this Agreement or any other
agreement or instrument, whether now existing or arising hereafter, Consignee
shall:
(a) Do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its corporate existence, rights, licenses,
permits and franchises and comply with all laws and regulations applicable to
it; at all times maintain, preserve and protect all franchises and trade names
and preserve all the remainder of its property used or useful in the conduct of
its business and keep the same in good repair, working order and condition, and
from time to time, make, or cause to be made, all needful and proper repairs,
renewals, replacements, betterments and improvements thereto, so that the
business carried on in connection therewith may be properly and advantageously
conducted all times;
(b) Comply with all applicable laws and regulations, whether now
in effect or hereafter enacted or promulgated by any Governmental Authority
having jurisdiction in the premises;
(c) Pay and discharge or cause to be paid and discharged all
taxes, assessments and governmental charges or levies imposed upon it or upon
its respective income and profits or upon any of its property, real, personal
or mixed, or upon any part thereof, before the same shall become in default, as
well as all lawful claims for labor, materials and supplies or otherwise,
which, if unpaid, might become a lien or charge upon such properties or any
part thereof; provided that Consignee shall not be required to pay and
discharge or cause to be paid and discharged any such tax, assessment, charge,
levy or claim so long as the validity thereof shall be contested in good faith
by appropriate proceedings and it shall have set aside on its books adequate
reserves with respect to any such tax, assessment, charge, levy or claim so
contested, and provided further, that payment with respect to any such tax,
assessment, charge, levy or claim shall be made before any of its property
shall be seized and sold in satisfaction thereof;
(d) Give prompt written notice to Consignor of any proceedings
instituted against it by or in any Federal or state court or before any
commission or other regulatory body, Federal, state or local, which, if
adversely determined, would have a materially adverse effect upon its business,
operations, properties, assets, or condition, financial or otherwise or could
result in the forfeiture of assets of Consignee;
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(e) Furnish to Consignor:
(i) within ninety (90) days after the end of each fiscal
year, Financial Statements showing its financial
condition at the close of such fiscal year, the
results of operations during such year and containing
a statement to the effect that its independent public
accountants have examined the provisions of this
Agreement and that no Event of Default nor any event
which with notice or lapse of time, or both, would
constitute an Event of Default has occurred:
(ii) within forty-five (45) days after the end of the
first and third quarter in each such fiscal year,
Financial Statements for such period and the fiscal
year to that date, subject to changes resulting from
routine year-end audit adjustments, in form
satisfactory to Consignor. Notwithstanding
provisions in the definition of "Financial
Statements" requiring certification by independent
public accountants, Financial Statements for this
subsection (ii) may be prepared and certified by the
chief financial officer of Consignee to the best of
his or her information and belief;
(iii) within ninety (90) days after the end of the six
month period ending December 31, Financial Statements
for such period and the fiscal year to date, subject
to changes resulting from routine year-end audit
adjustments in form satisfactory to Consignor,
provided that Financial Statements for this
subsection (iii) shall be reviewed by its independent
public accountants as opposed to certified;
(iv) simultaneously with the furnishing of each of the
Financial Statements to be delivered pursuant to
subsections (i) and (ii) above, a narrative statement
of the President or chief financial officer of
Consignee which shall comment upon and explain any
material changes, both positive and negative,
reflected in such statements from prior periods, and
which shall also contain a declaration to the effect
that such officer has reviewed the terms of this
Agreement and has no knowledge of any event or
condition which constitutes an Event of Default or
which with notice or lapse of time, or both, would
constitute an Event of Default or, if he or she has
such knowledge, specifying the nature and period of
existence of such event or condition;
(v) within twenty (20) days after the end of each month,
a consignment base certificate of Consignee as of the
last business day of the preceding month (such
certificate to be in the form of Exhibit B attached
hereto and certified by Consignee's Chief Financial
Officer or Treasurer);
(vi) within forty-five (45) after the end of each quarter
in each fiscal year, a certificate of Consignee as to
the status of Consignee's compliance with its
agreements with Consignor (such certificate to be in
the form of Exhibit C
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attached hereto and certified by Consignee's Chief
Financial Officer or Treasurer);
(f) Promptly, from time to time, furnish such other information
regarding its operations, assets, business affairs and financial condition as
Consignor may reasonably request;
(g) Permit agents or representatives of Consignor, at Consignee's
expense (including without limitation, the fees and expenses of such agents or
representatives), (i) to inspect, at any time during normal business hours and
without notice, the Consigned Precious Metal and Consignee's books and records
and to make abstracts or reproductions of such books and records, (ii) to
conduct field examinations of the Consigned Precious Metal in the possession
and control of Consignee (which examinations shall include the observance
thereof by its independent public accountants as to two of such examinations
per year including an annual audit review of Consignee's control system), such
examinations to be done at reasonable times and at any time in the case of an
emergency (provided, however, that Consignee only shall be required to pay for
two (2) field examinations per year unless an Event of Default has occurred and
is continuing, in which case all field examinations shall be at Consignee's
expense), (iii) to observe the taking of any physical inventory of Consigned
Precious Metal in Consignee's possession (Consignee shall give Consignor not
less that ten (10) days' prior Notice of the taking of each such inventory, and
(iv) at reasonable times and at any time in case of emergency, to take a
physical inventory of the Consigned Precious Metal in Consignee's possession;
(h) Promptly advise Consignor of any material adverse changes in
its condition, financial or otherwise, and of any condition or event which
constitutes or with notice of lapse of time or both would constitute, and Event
of Default;
(i) Promptly join with Consignor from time to time in executing
one or more financing statements pursuant to the Uniform Commercial Code in
form satisfactory to Consignor, and execute such other instruments in form
suitable for recording or filing as Consignor May reasonably require;
(j) Defend the Consigned Precious Metal against the claims and
demands of any persons (other than Consignor of those persons listed as secure
parties on Schedule B attached hereto) at any time claiming the same or any
interest therein;
(k) Consent, and Consignee does hereby consent to the delivery by
Consignor to any lender, lessor or consignor to Consignee of all information
and reports prepared or received by Consignor with respect to Consignee;
(l) Expect as to past violations being cured by Consignee as
described on Schedule C attached hereto, comply, and cause all tenants or other
occupants of any real property which Consignee owns or occupies to comply, in
all respects with all Environmental Requirements, and not generate, treat,
store, handle, process, transfer, transport, dispose of, release or otherwise
use, and not permit any tenant or other occupant of such property to generate,
treat, store, handle, process, transfer, transport, dispose of, release or
otherwise use, Hazardous Materials within, on, under or about such property, in
a manner that could lead to the imposition on Consignee,
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Consignor or any such real property of any liability or lien of any nature
whatsoever under any Environmental Requirement;
(m) Except as to matters described on Schedule C attached hereto,
notify Consignor promptly in the event of any spill or other release of any
Hazardous Material within, on, under or about any real property owned or
occupied by consignee which is required to be reported to a Governmental
Authority under any Environmental Requirement, promptly forward to Consignor
copies of any notices received by Consignee relating to alleged violation of
any Environmental Requirement and (as to all matters including, without
limitation, those disclosed on Schedule C attached hereto) promptly pay when
due any fine or assessment against Consignee, Consignor or any such real
property relating to any Environmental Requirement;
(n) Upon receipt of Notice by Consignee from a third party to whom
Consignee from a third party to whom Consignee has reconsigned Consigned
Precious Metal that such reconsigned Consigned Precious metal has been sold,
reconsigned or otherwise transferred or disposed of by such third party, and
within one (1) business day after receipt of such notice, purchase such
Consigned Precious Metal from Consignor pursuant to terms of this Agreement;
(o) Own equity Precious Metal (namely Precious Metal owned
outright by Consignee and not delivered to it pursuant to a "consignment",
"lease", "loan", "conditional sale" or other agreement) in an amount at least
equal to the sum of (i) five percent (5%) of Consignee's entire inventory of
Precious Metal consigned or leased to Consignee (including, without limitation,
Consigned Precious Metal) plus (ii) twenty percent (20%) of the amount of
Precious Metal physically located other than at Consignee's Principal office;
(p) Maintain at all times a Tangible Net Worth in an amount at
least equal to $37,000,000;
(q) Maintain at all times Working Capital in an amount at least
equal to $22,000,000;
(r) Maintain at all times a ratio of Total Liabilities (including,
without limitation, all obligations under this Agreement, any other precious
metal facility or similar agreements and any loan agreements) to Tangible Net
Worth of not more than 3.50:1.00 (4.00:1.00 during the period from September 1
through December 31), determined in accordance with generally accepted
accounting principles consistently applied;
(s) Maintain at all items a ratio of Current Liabilities PLUS
long-term Indebtedness secured by current assets (including, but not limited
to, obligations of Consignee to the First Insurance Companies and the Second
Insurance Companies) to Working Capital of not more than 6.30:1.00; and
(t) Maintain key-man life insurance with insurance companies
satisfactory to Consignor on the lives of Xxxxxxx Xxxxxxxxx and Xxxxxxx
Xxxxxxxxx, Xx. in the amount of not less than $5,000,000 each; provided,
however, that in the event that either of such individuals shall terminate his
employment with Consignee during his life, the insurance on the terminated
individual's life may be canceled.
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12. NEGATIVE COVENANTS.
------------------
Consignee covenants and agrees that, until Consignee makes payment and
performs in full its indebtedness, obligations and liabilities to Consignor
under this Agreement or any other agreement of instrument, whether now existing
or arising hereafter, unless Consignor consents in writing, Consignee will not,
directly or indirectly:
(a) Create, incur, assume or suffer to exist any mortgage, pledge,
lien, attachment, charge or other encumbrance of any nature whatsoever on any
of the Consigned Precious Metal or any products or property now or hereafter
owned by Consignee or in which Consignee presently has or hereafter acquires an
interest which does or will include the consigned Precious Metal other (i) than
security interests in favor of Consignor or as listed on Schedule B attached
hereto and (ii) mortgages on Consignee's Mount Vernon, New York real property;
(b) Sell, lease, transfer or otherwise dispose of its properties,
assets, rights, licenses and franchises to any person, except in the ordinary
course of its business, or turn over the management of, or enter into a
management contract with respect to, such properties, assets, rights, licenses
and franchises;
(c) Dissolve, liquidate, consolidate with or merge with, or
acquire all or substantially all of the assets or properties of, any other
corporation or entity, or make any substantial change in its executive
management;
(d) Sell, assign, encumber, pledge, discount or dispose of in any
way any accounts receivable, promissory notes or trade acceptances held by
Consignee, with or without recourse, except for (i) security interests as
listed on Schedule B attached hereto and (ii) collection (including
endorsements) in the ordinary course of business;
(e) Grant any security interest or ownership rights to any
customer of Consignee with respect to any of the Consigned Precious Metal while
at Consignee's premises whether or not such customers have prepaid orders for
the Consigned Precious Metal or any products or property which does or will
include the Consigned Precious Metal;
(f) Guarantee, endorse or otherwise in any way become or be
responsible for obligations of any other person, except endorsements of
negotiable instruments for collection in the ordinary course of business, or
guarantees on behalf of employees not to exceed $100,000 in the aggregate;
(g) Obtain precious Metal on consignment or loan from any source
other than Consignor or those persons listed as secured parties on Schedule B
attached hereto;
(h) Permit the aggregate amount of Consigned Precious Metal PLUS
Precious Metal consigned to Consignee by other consignors to exceed 275,000
xxxx ounces of fine gold; or
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(i) Permit the amount of Consignee's Precious metal inventory
physically located other than at consignee's Principal Office to exceed at any
time (i) 45,000 xxxx ounces of Precious Metal in the aggregate, (ii) 10,000
xxxx ounces at, or in transit to or from any one location (excluding Wal-Mart
locations) or (iii) 4,000 xxxx ounces outside the United States.
13. EVENTS OF DEFAULT; RIGHTS AND REMEDIES OF CONSIGNOR UPON DEFAULT.
----------------------------------------------------------------
In each case of happening of any of the following events (each of
which is herein sometimes called an "Event of Default"):
(a) Any representation or warranty made herein, or in any report,
certificate, financial statement or other instrument furnished in connection
with this Agreement, or the Delivery of Precious Metal by Consignor hereunder,
shall prove to be false or misleading in any material respect;
(b) Consignee fails to make punctual payment or perform any
obligation required by the provisions of Section 2, 5 6 or 14 of this
Agreement;
(c) Consignee fails to pay any amount due hereunder or any other
indebtedness, obligation or liability of Consignee to Consignor when the same
shall become due and payable, whether at the due date thereof or at a date
fixed for prepayment or by acceleration or otherwise;
(d) Consignee fails to observe or perform any covenant condition
or agreement required by the terms of Sections 7, 8, 11(g), 11(n), 11(o),
11(p), 11(q), 11(r), 11(s), 11(t), 12(a), 12(c), 12(e), 12(f), 12(g), 12(h) or
12(i) of this Agreement;
(e) Consignee fails to observe or perform any other covenant,
condition or agreement required by the terms of this Agreement and such failure
shall continue unremedied for ten (10) days:
(f) Default with respect to any evidence of indebtedness,
obligations or liabilities of Consignee (including, but not limited to,
consignment agreements and any other agreements between Consignee and any
parent, affiliate or subsidiary of Consignor), if the effect of such default is
to accelerate the maturity of such indebtedness or to permit the holder thereof
to cause such indebtedness to become due prior to the stated maturity thereof,
or if any indebtedness of Consignee is not paid, when due and payable, whether
at the due date thereof or by acceleration or otherwise;
(g) Consignee shall (i) apply for, consent to, or suffer the
appointment of a custodian, receiver, trustee or liquidator of it or any of its
property, (ii) admit in writing its inability to pay its debts as they mature,
(iii) make a general assignment for the benefit of creditors, (iv) file, or
have filed against it, a petition for relief under Title 11 of the United
States Code, or (V) file, or have filed against it, a petition in bankruptcy,
or a petition or an answer seeking reorganization or an arrangement with
creditors or to take advantage of any bankruptcy, reorganization, insolvency,
readjustment of debt, dissolution or liquidation law or insolvency,
readjustment of debt,
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dissolution or liquidation law or statute, or an answer admitting the material
allegations of a petition filed against it in any proceeding under any such
law, or corporate action shall be taken for the purpose of effecting any of the
foregoing;
(h) An order, judgment or decree shall be entered, without the
application, approval or consent of Consignee by any court of competent
jurisdiction, approving a petition seeking reorganization of Consignee or
appointing a custodian, receiver, trustee or liquidator of Consignee or of all
or a substantial part or the assets of Consignee;
(i) Occurrence of any loss, theft, or destruction of or damage to
the Consigned Precious Metal or any products or property which includes
Consigned Precious Metal;
(j) Discontinuance of the operation of Consignee's business for
any reason;
(k) For any reason the present chief financial officer shall cease
to be or function as the chief financial officer of Consignee and a successor
is not appointed within sixty (60) days of such cessation;
(l) For any reason the present President shall cease to be or
function as President and chief executive officer of Consignee and a successor
is not appointed with sixty (60) days of such cessation;
(m) Occurrence of an event of default under any credit, loan or
consignment agreement to which Consignee is a party, as amended or modified
from time to time, including, without limitation, (i) that certain Note
Purchase Agreement dated as December 1, 1987 between Consignee and Northwestern
National Life Insurance Company, Northern Life Insurance Company and The North
Atlantic Life Insurance Company of America (collectively, the "First Insurance
Companies"), (ii) that certain Note Purchase Agreement dated May 1, 1992
between Consignee and Northern Life Insurance Company, Royal Maccabees Life
Insurance Company, The North Atlantic Life Insurance Company of America, Farm
Bureau Life Insurance Company of Michigan, FB Annuity Company and Farm Bureau
Mutual Insurance Company of Michigan (collectively, the "Second Insurance
Companies"), (iii) that certain Note Purchase Agreement dated as of February
15, 1995 between Consignee and Northwestern National Life Insurance Company and
Northern Life Insurance Company (collectively, the "Third Insurance
Companies"), (iv) those certain Consignment Agreements or Amended and Restated
Consignment Agreements dated as of August 20, 1993 between Consignee and each
of RIHT, ABN, Mocatta, CS and FPM, respectively, (v) that certain Consignment
Agreement dated as of September 1, 1994 between Consignee and Deutsche Bank
Sharps Xxxxxx Inc. and (vi) any promissory note (including, without
limitation, that promissory note of Debtor in favor of Chemical Bank dated
March 29, 1995) and/or agreements in favor of Chemical Bank;
(n) Occurrence of any Event of Default as defined in the Security
Agreement;
(o) Occurrence of any attachment on any Precious Metal owned by
Consignee or on any Consigned Precious Metal; or
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(p) Determination by Consignor in good faith that Consignee has
suffered a material adverse change in its business or financial condition.
Upon the occurrence of any such Event of Default and at any time
thereafter during the continuance of such Event of Default, Consignor may, by
Notice to Consignee, terminate this Agreement as provided in Section 14 and
declare all liabilities, indebtedness or obligations of Consignee to be due and
payable. Upon Consignor's declaration, such liabilities, indebtedness and
obligations shall become immediately due and payable, both as to principal
and/or interest, without presentment, demand, protest or notice of any kind,
all of which are hereby expressly waived, anything contained herein or in any
other evidence of such indebtedness, obligations and liabilities to the
contrary notwithstanding. Consignor may enforce payment of the same and
exercise any or all of the rights, powers and remedies possessed by Consignor,
under this Agreement or under any agreement securing the obligations of
Consignee hereunder, whether afforded by the Uniform Commercial Code or
otherwise by law or in equity. The remedies provided for herein are cumulative
and are not exclusive of any other remedies provided by law. Consignee agrees
to pay Consignor's reasonable attorney's fees and legal expenses incurred in
enforcing Consignor's rights, powers and remedies under this Agreement, the
Security Agreement and any agreement securing the liabilities, indebtedness or
obligations of Consignee to Consignor.
Without limiting the foregoing, upon the occurrence of any Event of
Default and at any time thereafter during the continuance thereof, Consignor
shall have the right to enter and/or remain upon the premises of Consignee or
any other place or places where any Consigned Precious Metal is located and
kept (without any obligation to pay rent to Consignee or others) and; (i)
remove Consigned Precious Metal or inventory containing the same therefrom to
the premises of Consignor or any agent of Consignor, for such time as Consignor
may desire, in order to maintain, collect, sell and/or liquidate said Consigned
Precious Metal or (ii) use such premises, together with equipment, materials,
supplies, books and records of Consignee, to maintain possession, refine and
prepare said Consigned Precious Metal for sale, liquidation, or collection.
Consignor may require Consignee to assemble the Consigned Precious Metal and
make it available to Consignor at a place or places to be designated by
Consignor which is reasonably convenient for the parties. Consignor may at any
time and from time to time employ and maintain in any premises of Consignee or
any place where any of the Consigned Precious Metal is located a custodian
selected by Consignor who shall have full authority to do all acts necessary to
protect Consignor's interests and to report to Consignor thereon. Consignee
agrees to cooperate with any such custodian and to do whatever Consignor may
reasonably request to preserve the Consigned Precious Metal. All reasonable
expenses incurred by reason of the employment of the custodian shall be paid by
Consignee pursuant to the last sentence in Section 8 hereof.
14. TERMINATION.
-----------
This Agreement shall terminate, at the election of the Consignor, upon
the occurrence of any Event of Default. Unless otherwise terminated in
accordance with the terms hereof, this Agreement shall continue until either
Consignor or Consignee elects to terminate this Agreement by not less than
thirty (30) days' prior Notice to the other party. Unless otherwise mutually
agreed in writing by Consignor and Consignee, no Delivery of Precious Metal to
Consignee will be made following the giving of Notice by either Consignor or
Consignee of its election to
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terminate this Agreement. Termination of this Agreement shall not affect
Consignee's duty to pay and perform in full its obligations to Consignor
hereunder. On the effective date of the termination of this Agreement,
Consignee shall either Redeliver or purchase and pay for all Consigned Precious
Metal which Consignor has previously Delivered and which has not been paid for
or Redelivered, the price to be based on Consignor's spot market price on the
date of such purchase and shall reimburse Consignor for any and all outstanding
fees, costs, expenses and other obligations of Consignee to Consignor.
15. INDEMNITY.
---------
Consignee will defend, indemnify and hold harmless Consignor, its
employees, agents, officers, and directors, from and against any and all
claims, demands, penalties, causes of action, fines, liabilities, settlements,
damages, costs or expenses of whatever kind or nature, known or unknown,
foreseen or unforeseen, contingent or otherwise (including, without limitation,
counsel and consultant fees and expenses, (investigation and laboratory fees
and expenses, court costs, and litigation expenses) arising out of, or in any
way related to, (i) any breach by Consignee of any of the provisions of this
Agreement, (ii) the presence, disposal, spillage, discharge, emission, leakage,
release, or threatened release of any Hazardous Material within, on, under,
about, from or affecting any real property owned or occupied by Consignee,
including, without limitation, any damage or injury resulting from any such
Hazardous Material to or affecting such property or the soil, water, air,
vegetation, buildings, personal property, persons or animals located on such
property or on any other property or otherwise, (iii) any personal injury
(including wrongful death) or property damage (real or personal) arising out of
or related to any such Hazardous Material, (iv) any lawsuit brought or
threatened, settlement reached, or order or directive of or by any Governmental
Authority relating to such Hazardous Material or (V) any violation of any
Environmental Requirement.
16. MISCELLANEOUS.
-------------
(a) This Agreement and all covenants, agreements, representations
and warranties made herein and in the certificates delivered pursuant hereto,
shall survive the execution and delivery to Consignor of this Agreement, and
shall continue in full force and effect so long as this Agreement and any other
indebtedness of Consignee to Consignor is outstanding and unpaid. In this
Agreement, reference to a party shall be deemed to include the successors and
permitted assigns of such party, and all covenants and agreements in this
Agreement by or on behalf of Consignee shall inure to the benefit of the
successors and assigns of Consignor.
(b) Consignee will reimburse Consignor upon demand for all
out-of-pocket costs, charges and expenses of Consignor (including costs of
searches of public records and filing and recording documents with public
offices and reasonable fees and disbursements of counsel to Consignor) in
connection with (i) the preparation, execution and delivery of this Agreement,
(ii) any amendments, modifications, consents or waivers in respect hereof and
(iii) any enforcement hereof.
(c) This Agreement shall be construed in accordance with and
governed by the laws of the State of New York.
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(d) No modification or waiver of any provision of this Agreement,
or of any security document, nor consent to any departure of Consignee from a
provision, shall be effective unless the same shall be in writing. A written
consent shall be effective only in the specific instance, and for the purpose,
for which given. No notice to, or demand on Consignee, in any one case, shall
entitle Consignee to any other or future notice or demand in the same, similar
or other circumstances.
(e) Neither any failure nor any delay on the part of Consignor in
exercising any right, power or privilege hereunder, or in any other instrument
given as a security therefor, shall operate as a waiver thereof, nor shall a
single or partial exercise thereof preclude any other or future exercise, or
the exercise of any other right, power or privilege.
(f) Consignee shall not have the right to assign its rights
hereunder or any interest herein without the prior written consent of the
Consignor.
(g) Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
(h) Any Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose. As used in this Agreement, the term "person" shall
include any individual, corporation, partnership, joint venture, trust or
unincorporated organization, or a government or any agency or political
subdivision thereof.
(i) Consignee hereby submits to the jurisdiction of the courts of
the state of New York and the United States District Court for the Southern
District of New York, as well as the jurisdiction of all courts to which an
appeal may be taken or other review sought from the aforesaid courts, for the
purpose of any suit, action or other proceeding arising out of any of the
Consignee's obligations under or with respect to this Agreement, and expressly
waives any and all objections it may have as to value in any such courts.
CONSIGNEE AND CONSIGNOR EACH WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM BROUGHT BY EITHER OF THEM AGAINST THE OTHER IN ANY MANNER
WHATSOEVER (INCLUDING, WITHOUT LIMITATION, ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT ANY
OTHER DOCUMENTS EXECUTED IN CONNECTION HEREWITH OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREIN OR THEREIN). No party to this Agreement, including BUT NOT
LIMITED to any assignee or successor or a party, shall seek a jury trial in any
lawsuit, proceeding, counterclaim, or any other litigation procedure based
upon, or arising out of, this Agreement, any related instruments, any
collateral or the dealings or relationship between the parties. No party will
seek to consolidate any such action, in which a jury trial has been waived,
with any other action in which a jury trial cannot be or has not been waived.
THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY DISCUSSED BY THE PARTIES
HERETO, AND THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS. NO PARTY HAS
IN ANY WAY AGREED WITH OR REPRESENTED TO
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ANY OTHER PARTY THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY
ENFORCED IN ALL INSTANCES.
IN WITNESS WHEREOF, Consignor and Consignee have caused this Agreement
to be duly executed by their duly authorized officers, all as of the day and
year first above written.
UNION BANK OF SWITZERLAND
New York Branch
Consignor
By /s/ Xxxxxxxx Xxxxxxxx
--------------------------
Title:Vice President
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------
Title:Vice President
Xxxxxxx Xxxxxxx Jewelers, Inc.
Consignee
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Title Treasurer
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