Exhibit 10.22
EXHIBIT B
INVESTOR FUNDING AGREEMENT dated as of May 10, 2002,
among KEY ACQUISITION, L.L.C., a Delaware limited liability
company (the "Investor"), ▇▇▇▇▇▇▇ ELECTRONICS HOLDINGS,
INC., formerly known as ▇▇▇▇▇▇▇ Electronics, Inc., a
Delaware corporation ("▇▇▇▇▇▇▇"), and JPMORGAN CHASE BANK,
in its capacity as Administrative Agent (the "Agent") for
the Lenders under the Credit Agreement (as defined herein).
▇▇▇▇▇▇▇, certain Lenders and the Agent are party to a Credit
Agreement dated as of June 28, 1999, as amended and restated as of July 21,
1999, as amended (as amended from time to time, the "Credit Agreement").
▇▇▇▇▇▇▇ has requested that the Lenders agree to that certain Amendment No. 4
and Waiver to the Credit Agreement (the "Amendment"), and it is a condition to
the effectiveness of the Amendment that the parties hereto enter into this
Agreement. The Investor owns ▇▇▇▇▇▇▇ and will benefit from the Amendment.
In order to induce the Lenders and the Agent to enter into the
Amendment and to induce the Lenders to continue to make loans and other
extensions of credit under the Credit Agreement, and to satisfy a condition to
the effectiveness of the Amendment, the Investor and ▇▇▇▇▇▇▇ are entering into
this Agreement for the benefit of the Lenders and the Agent.
Accordingly, the parties hereto agree as follows:
SECTION 1. Defined Terms. (a) Capitalized terms that are used
but not defined herein shall have the meanings given to them in the Credit
Agreement as in effect on the date hereof (after giving effect to the
Amendment). The rules of interpretation set forth in Section 1.03 of the Credit
Agreement shall be applicable to this Agreement.
(b) As used in this Agreement, the following terms have the
meanings assigned to them below:
"Acknowledgment Agreement" means the Acknowledgment Agreement
dated as of the date hereof, among DHC, the DH Investors and the Agent.
"Agent" has the meaning given to such term in the heading of
this Agreement.
"Agent Contribution Notice" has the meaning given to such term
in Section 2(a).
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"Amendment" has the meaning given to such term in the preliminary
statement of this Agreement.
"Capital Agreement" means the separate agreement entered into or to be
entered into between the Investor and ▇▇▇▇▇▇▇ providing for the issuance by
▇▇▇▇▇▇▇ of shares of its capital stock to the Investor in consideration of the
Contribution.
"Contribution" means, without duplication, (a) the cash payment, if
any, required to be made by the Investor to or for the benefit of ▇▇▇▇▇▇▇
pursuant to Section 2(a) as an additional cash equity investment by the Investor
in ▇▇▇▇▇▇▇ and (b) to the extent not included in clause (a) of this definition,
each purchase by the Investor of a participating interest in Loans or Letters of
Credit pursuant to Section 2(c).
"Contribution Amount" has the meaning given to such term in Section
2(a).
"Credit Agreement" has the meaning given to such term in the
preliminary statement of this Agreement.
"DHC" means ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Limited.
"DH Investors" has the meaning given to such term in the DH Investment
Agreement.
"DH Investment Agreement" means the Contribution to Capital Agreement
dated the date hereof, entered into among DHC, the DH Investors named therein
and the Investor and providing for the undertaking by such Sponsors to subscribe
for certain equity interests in the Investor.
"Excess Amount" has the meaning given to such term in Section 2(a).
"Funding Date" has the meaning given to such term in Section 2(a).
"Investor" has the meaning given to such term in the heading of this
Agreement.
"Investor Collateral Agreement" means the Collateral Agreement dated
as of the date hereof, between the Agent and the Investor providing for, among
other things, the collateral assignment by the Investor of its rights under the
DH Investment Agreement to secure its obligations under this Agreement.
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"▇▇▇▇▇▇▇" has the meaning given to such term in the heading of this
Agreement.
"Prohibited Contribution" has the meaning given to such term in Section
2(c).
"Release Date" means the first to occur of (a) the date on and as of which
all the Commitments have expired, have been terminated or cash collateralized,
all Letters of Credit have expired or have been terminated and all Obligations
have been paid in full, or (b) the date on which the Contribution has been fully
funded by the Investor in accordance with this Agreement (and, if funded
pursuant to Section 2(c), the Investor shall have entered into one or more
participation agreements as contemplated by such Section), or (c) October 3,
2002, if there is no Excess Amount on the Trigger Date.
"Transaction Documents" means this Agreement, the DH Investment Agreement,
the Investor Collateral Agreement and the Acknowledgment Agreement.
"Trigger Date" means the first to occur of (a) September 3, 2002, or (b)
the date that an Event of Default with respect to ▇▇▇▇▇▇▇ occurs that is
described in clause (h) or (i) of Article VII of the Credit Agreement, or (c)
the date on which the Loans outstanding under the Credit Agreement are declared
to be due and payable as a result of an Event of Default.
SECTION 2. Capital Contributions.
(a) Notwithstanding any provision to the contrary contained in the Capital
Agreement or any other agreement between the Investor and ▇▇▇▇▇▇▇, the Investor,
▇▇▇▇▇▇▇ and the Agent agree that if on and as of the Trigger Date ▇▇▇▇▇▇▇ has
not received Required Additional Capital resulting in net proceeds to ▇▇▇▇▇▇▇ of
at least $10,000,000, then (i) the Agent will (on such date or thereafter)
notify the Investor and ▇▇▇▇▇▇▇ of the amount of the excess of $10,000,000 over
the amount of Required Additional Capital previously received by ▇▇▇▇▇▇▇ (the
"Excess Amount"), which notice (the "Agent Contribution Notice") shall specify a
Business Day not less than 12 Business Days after the date of the Agent
Contribution Notice (the Business Day so specified, the "Funding Date") on which
the Investor will be required to make the Contribution in an amount (the
"Contribution Amount"), which shall be specified in the Agent Contribution
Notice, equal to the Excess Amount and (ii) on the Funding Date the Investor
shall make the Contribution in an amount equal to the Contribution Amount in
accordance with
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the requirements of this Agreement. Such Contribution shall be made in United
States dollars.
(b) Notwithstanding any provision to the contrary contained in the
Capital Agreement or any other agreement between the Investor and ▇▇▇▇▇▇▇ (but
subject to paragraph (c) below), ▇▇▇▇▇▇▇ hereby irrevocably directs the Investor
to make, and the Investor shall make, the Contribution to ▇▇▇▇▇▇▇ required to be
made by it pursuant to paragraph (a) of this Section by making, on or before the
Funding Date, a wire transfer of immediately available funds equal to the
Contribution Amount directly to the Agent for the benefit of the Secured
Parties, into such account as the Agent may specify in the Agent Contribution
Notice. ▇▇▇▇▇▇▇ hereby irrevocably directs the Agent to apply, and the Agent
will promptly apply, all such funds received by it to the payment of Domestic
Revolving Borrowings and/or Domestic Swingline Borrowings (and/or, to the extent
of any remaining excess after giving effect to payment of all outstanding
Domestic Revolving Borrowing and domestic Swingline Borrowings, to the cash
collateralization of outstanding Letters of Credit). The Investor and ▇▇▇▇▇▇▇
acknowledge and agree that the making by the Investor of the Contribution
provided in this paragraph (b) shall entitle the Investor to the issuance to it
of additional shares of capital stock of ▇▇▇▇▇▇▇ in accordance with the Capital
Agreement.
(c) In the event that the Contribution required to be made by the
Investor pursuant to this Section, or the application thereof contemplated by
paragraph (b) above, is prohibited by law or any injunction, decree or similar
legal restraint, including as a result of any bankruptcy, reorganization,
insolvency or similar proceeding affecting ▇▇▇▇▇▇▇ (a "Prohibited
Contribution"), then the Agent for the benefit of the Secured Parties shall have
the option of requiring the Investor to purchase for cash, at par, a
subordinated, undivided participating interest in the outstanding Domestic
Revolving Borrowings and/or Domestic Swingline Borrowings (and/or, to the extent
that the Contribution Amount exceeds the outstanding principal amount of
Domestic Revolving Borrowings and Domestic Swingline Borrowings, Letters of
Credit) for an aggregate purchase price equal to the Contribution Amount. The
Agent shall exercise such option by giving written notice thereof to the
Investor (which notice may be given on or after the Trigger Date, whether or not
an Agent Contribution Notice has been given, provided that such notice is given
before the Contribution is actually made as contemplated by paragraphs (a) and
(b) above) specifying a closing date that shall not be prior to the Funding Date
specified in the Agent Contribution Notice. On such closing date the Investor
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shall purchase such participating interest by a wire transfer to the Agent of
immediately available funds equal to the Contribution Amount; provided that the
amount of the purchase price, if any, attributable to any such participations
in outstanding Letters of Credit shall be held by the Agent until all
outstanding Letters of Credit have either terminated or are drawn, and returned
to the Investor to the extent not applied to participations in LC Disbursements
after giving effect to all such drawn Letters of Credit. Such participating
interest will be subordinated to each Lender's retained interest in the Loans,
Letter of Credit reimbursement obligations and other Obligations, and
distributions in respect of such participating interest will be made only after
all Obligations in respect of such retained interests have been paid in full.
On such closing date, the Investor will execute and deliver one or more
participation agreements with respect to its participating interest, in the
standard form employed by the Agent for such agreements (modified to reflect
the subordination referred to above), but failure to do so shall not relieve
the Investor of its obligations hereunder. Each such participation will be
allocated on a pro rata basis to the Domestic Revolving Loans and/or Domestic
Swingline Loans (and, if applicable, participations in Letters of Credit) of
each Lender. Upon entering into such participation agreements and making
payment of the purchase price for its participating interest as provided above
on such closing date, the Investor will be relieved of its obligation hereunder
to make the Prohibited Contribution. In the event the Investor transfers funds
to the Agent in respect of a Contribution to be made by it hereunder as
contemplated by paragraph (b) above, but the corresponding equity investment in
▇▇▇▇▇▇▇ or the application of the proceeds thereof to pay Domestic Revolving
Borrowings and/or Domestic Swingline Borrowings is prohibited by law or any
injunction, decree or similar legal restraint, then such contribution shall be
deemed a Prohibited Contribution and such funds shall be retained by the Agent
(for itself and on behalf of the Lenders) and utilized to make payment of the
purchase price for a subordinated participating interest of the Investor in
Domestic Revolving Loans and/or Domestic Swingline Loans (and/or, at the
Agent's election, Letters of Credit) in accordance with the foregoing
provisions.
(d) The obligations of the Investor to make the Contribution required
pursuant to the provisions of this Section shall be absolute and unconditional
in any and all circumstances, notwithstanding the failure to satisfy any one or
more conditions under, or the breach by any party thereto of, the Capital
Agreement or any other agreement to which the Investor or ▇▇▇▇▇▇▇ is a party or
bound, and
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notwithstanding any bankruptcy, reorganization, liquidation, insolvency or
similar proceeding instituted by or against the Investor or ▇▇▇▇▇▇▇, and
notwithstanding any failure of any Person that has agreed to provide funds to
the Investor to make such Contribution to provide such funds. The Investor or
any other investor in ▇▇▇▇▇▇▇ may make, but shall not be obligated by this
Agreement to make, any investment in ▇▇▇▇▇▇▇ at any time, but no such
investment or failure to make such investment shall excuse, reduce, satisfy or
otherwise vary the obligations of the Investor to make the Contribution.
SECTION 3. Certain Covenants. Until the Release Date, the Investor
covenants and agrees with ▇▇▇▇▇▇▇ and the Agent that:
(a) Indebtedness and Other Liabilities. The Investor will not create,
incur, assume or permit to exist any Indebtedness or other liability of it,
except liabilities under this Agreement.
(b) Activities. The Investor will not engage in any business or activity
other than the ownership of equity investments in ▇▇▇▇▇▇▇ and activities
incidental thereto, including the performance of its obligations under this
Agreement.
(c) Fundamental Changes. The Investor will not (i) merge into or
consolidate with any other Person, or permit any other Person to merge into or
consolidate with it, (ii) liquidate, dissolve or wind up, (iii) sell, transfer
or otherwise dispose of any of its assets (including pursuant to any dividend or
distribution with respect to its Equity Interests), except that this clause
shall not be construed to prohibit the Contribution or any other investments in
▇▇▇▇▇▇▇ permitted by the Credit Agreement, (iv) permit any amendment or
modification to its organizational documents that would restrict or impair the
performance of any Transaction Document, (v) commence, or suffer to be commenced
by any other Person, any proceeding or file, or suffer to be filed by any other
Person, any petition, in either case seeking (A) liquidation, reorganization or
other relief in respect of the Investor or its debts or assets under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar law
now or hereafter in effect or (B) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Investor or its
assets, (vi) make a general assignment for the benefit of creditors, or (vii)
take any other action that would, or permit or suffer to exist any
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other circumstance or event that would, restrict or impair the performance of
any Transaction Document.
SECTION 4. Security Interest. (a) ▇▇▇▇▇▇▇ hereby confirms to and
agrees with the Agent that all right, title and interest of ▇▇▇▇▇▇▇ under this
Agreement constitutes "Collateral" under, and as defined in, the Security
Agreement. In furtherance of the foregoing, ▇▇▇▇▇▇▇ hereby assigns to the
Agent, as security, all its rights hereunder, including its rights to enforce
this Agreement and to receive the proceeds of the Capital Contribution. ▇▇▇▇▇▇▇
acknowledges and confirms that the power of attorney granted to the Agent under
Section 5.03 of the Security Agreement applies to this Agreement and ▇▇▇▇▇▇▇'
rights hereunder.
(b) The Investor consents to the security interest and assignment
referred to in paragraph (a) above and acknowledges and agrees that (i) the
Agent may enforce ▇▇▇▇▇▇▇' rights under this Agreement and (ii) all payments
that the Investor is required to make to or for the benefit of ▇▇▇▇▇▇▇ pursuant
to this Agreement shall be made directly to the Agent (for the benefit of the
Secured Parties) for ▇▇▇▇▇▇▇' account (it being understood that payments
pursuant to Section 2(c) of this Agreement also shall be made directly to the
Agent but are not for ▇▇▇▇▇▇▇' account).
SECTION 5. Representations and Warranties. The Investor represents
and warrants to ▇▇▇▇▇▇▇ and the Agent that:
(a) the Investor is a duly organized and validly existing limited
liability company organized under the laws of the State of Delaware;
(b) the execution, delivery and performance by the Investor of the
Transaction Documents are within the Investor's powers and have been duly
authorized by all necessary action on the part of the Investor and the
holders of its Equity Interests;
(c) each of the Transaction Documents has been duly executed and
delivered by it and constitutes a legal, valid and binding obligation of
it, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in
equity or at law;
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(d) its execution, delivery and performance of each of the Transaction
Documents (i) except for the filing of appropriate Uniform Commercial Code
financing statements, does not require any consent or approval of,
registration or filing with, or other action by any Governmental Authority,
(ii) will not violate any applicable law or regulation or its limited
liability company agreement or other organizational documents or any or
order of any Governmental Authority and (iii) will not violate or result in
a default under any agreement or instrument binding on it; and
(e) the Investor does not have any Indebtedness or other liabilities,
other than its obligations under the Transaction Documents.
SECTION 6. Termination. This Agreement shall remain in full force
and effect until the Release Date, at which time this Agreement shall terminate
and the Investor shall have no further obligations hereunder.
SECTION 7. Notices. All notices and other communications provided
for herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopy, as
follows:
(a) if to ▇▇▇▇▇▇▇, to it at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention of Chief Financial Officer (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇);
(b) if to the Investor, to it c/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Limited at ▇▇▇
▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇
(Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇); and
(c) if to the Agent, to it at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention of ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ (Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇).
Any party hereto may change its address or telecopy number of notices and other
communications hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the
provisions of this Agreement shall be deemed to have been given on the date of
receipt.
SECTION 8. Waivers; Amendments. (a) No failure or delay by ▇▇▇▇▇▇▇
or the Agent exercising any right or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power,
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or any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. No waiver of any provision of this Agreement or consent to any
departure by the Investor therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) of this Section, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement in writing entered into by
▇▇▇▇▇▇▇, the Investor and the Agent; provided that any waiver, amendment or
modification that affects only the rights and obligations of the Agent and the
Investor with respect to the purchase and sale of participations in Loans or
Letters of Credit as contemplated by Section 2(c), shall not require the consent
or approval of ▇▇▇▇▇▇▇.
SECTION 9. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including, in the
case of the Agent, any successor Administrative Agent under the Credit
Agreement), except that neither the Investor nor ▇▇▇▇▇▇▇ may assign or otherwise
transfer any of its rights or obligations hereunder (except, in the case of
▇▇▇▇▇▇▇, as provided in Section 4) and any attempted assignment or transfer in
violation thereof shall be null and void.
(b) In acting under this Agreement, the Agent will be acting for and
on behalf of the Lenders under the Credit Agreement. It is understood and agreed
that the Agent shall be entitled to seek the approval of the Required Lenders in
connection with (in which case such approval shall be a condition to) any
consent or approval requested from the Agent hereunder or any waiver,
modification or amendment of this Agreement, and the Agent shall have no
liability hereunder in its capacity as such for any action taken or not taken by
it with the consent or at the request of the Required Lenders.
SECTION 10. Counterparts; Integration. This Agreement may be executed
in counterparts (and by different parties hereto on different counterparts),
each of which shall constitute an original, but all of which when taken together
shall constitute a single contract. This Agreement and the other Transaction
Documents constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. This
Agreement shall become effective when it shall have been executed by the Agent
and when the Agent shall have received counterparts hereof which, when taken
together, bear the signatures of each of the other parties hereto. Delivery of
an executed counterpart of a signature page of this Agreement by telecopy shall
be effective as delivery of a manually executed counterpart of this Agreement.
SECTION 11. Severability. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity or a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 12. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York.
(b) Each of the Investor and ▇▇▇▇▇▇▇ hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Transaction Document
shall affect any right that the Agent may otherwise have to bring any action or
proceeding relating to this Agreement against any party hereto or its properties
in the courts of any jurisdiction.
(c) Each of the Investor and ▇▇▇▇▇▇▇ hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively
do so, any objection which it may now or hereafter have to the laying of venue
of
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any suit, action or proceeding arising out of or relating to this Agreement or
any other Transaction Document in any court referred to in paragraph (b) of
this Section. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 7. Nothing in this
Agreement or any other Transaction Document will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.
SECTION 13. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 14. Headings. Section headings used herein are for
convenience of reference only, are not part of this Agreement and shall not
affect the construction of, or be taken into consideration in interpreting,
this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
KEY ACQUISITION, L.L.C,
by
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Name:
Title:
▇▇▇▇▇▇▇ ELECTRONICS HOLDINGS, INC.,
by
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Name:
Title:
JPMORGAN CHASE BANK, as Agent,
by
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Name:
Title: