Exhibit 4.15
AK STEEL CORPORATION
(AK STEEL HOLDING CORPORATION, as Guarantor)
------------------------
SUPPLEMENTAL AGREEMENT
Dated as of July 28, 1999
amending the
Note Purchase Agreements dated as of December 17, 1996
------------------------
Senior Secured Notes, Series A-E, due 2004
NY2:\830467\01\HSSJ01!.DOC\38055.0020
AK STEEL CORPORATION
AK STEEL HOLDING CORPORATION
SUPPLEMENTAL AGREEMENT
as of July 28, 1999
Re: Senior Secured Notes, Series A-E, due 2004
TO THE SEVERAL NOTEHOLDERS WHOSE
NAMES APPEAR IN THE ACCEPTANCE
FORM AT THE END HEREOF
Ladies and Gentlemen:
AK STEEL CORPORATION, a Delaware corporation (the
"COMPANY"), and AK STEEL HOLDING CORPORATION, a Delaware corporation ("HOLDING"
and, together with the Company, individually an "OBLIGOR" and collectively the
"OBLIGORS"), hereby agree with you as follows:
SECTION 1. Original Note Purchase Agreements and the Notes;
Proposed Amendments. Pursuant to the several Note Purchase Agreements dated as
of December 17, 1996 (the "ORIGINAL NOTE PURCHASE AGREEMENTS") entered into by
the Obligors with the institutional investors named in Schedule A thereto, the
Company issued and sold $250,000,000 aggregate principal amount of its Senior
Secured Notes, Series A-E, due 2004 (the "NOTES"), all of which remain
outstanding on the date hereof. Unless the context otherwise requires,
capitalized terms used herein without definition have the respective meanings
ascribed thereto in the Original Note Purchase Agreements.
The Obligors have entered into an Agreement and Plan of
Merger, dated as of May 20, 1999, as amended (the "MERGER AGREEMENT"), with
Armco Inc. ("ARMCO") pursuant to which Armco will be merged with and into the
Company and the separate corporate existence of Armco will cease (the "MERGER").
In connection therewith the Company has solicited consents from the holders of
its 9 1/8% Senior Notes Due 2006 and its 7 7/8% Senior Notes Due 2009 pursuant
to a Consent Solicitation Statement dated July 19, 1999 (THE "HIGH YIELD NOTES
CONSENT SOLICITATION"). In connection therewith the Obligors also propose to
amend the Original Note Purchase Agreements as hereinafter set forth (the
Original Note Purchase Agreements as so amended are sometimes called the
"AMENDED NOTE PURCHASE AGREEMENTS"), to permit certain adjustments to
Consolidated Net Income in connection with permitted Restricted Payments, to
eliminate the requirement that certain Subsidiaries execute and deliver
Subsidiary Guarantees and to permit the Company and its Subsidiaries to continue
to engage in certain lines of business after giving effect to the Merger.
SECTION 2. Representations and Warranties of the Obligors.
The Obligors jointly and severally represent and warrant to you as follows:
Section 2.1. Organization, Authorization, Etc. Each Obligor
is a corporation duly organized, validly existing and in good standing under the
laws of Delaware, and has all requisite power and authority to execute, deliver
and perform its obligations under this Supplemental Agreement and the Amended
Note Purchase Agreements.
The execution and delivery of this Supplemental Agreement
and the performance of this Supplemental Agreement and the Amended Note Purchase
Agreements have been duly authorized by all necessary action on the part of each
Obligor. This Supplemental Agreement and the Amended Note Purchase Agreements
are legal, valid and binding obligations of the Obligors, enforceable against
the Obligors in accordance with their respective terms, except as enforceability
may be limited by (a) applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights and remedies generally and (b) general principles of equity,
including principles of commercial reasonableness, good faith and fair dealing
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
Section 2.2. Compliance with Laws, Other Instruments, Etc.
The execution, delivery and performance by the Obligors of this Supplemental
Agreement and the Amended Note Purchase Agreements do not and will not (A)
contravene, result in any breach of, or constitute a default under, or result in
the creation of any Lien in respect of any property of the Obligors or any of
their respective Subsidiaries under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, corporate charter or by-laws, or any
other agreement or instrument to which the Obligors or any of their respective
Subsidiaries is bound or by which the Obligors or any of their respective
Subsidiaries or any of their respective properties may be bound or affected, (B)
conflict with or result in a breach of any of the terms, conditions or
provisions of any order, judgment, decree, or ruling of any court, arbitrator or
Governmental Authority applicable to the Obligors or any of their respective
Subsidiaries or (C) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Obligors or any of
their respective Subsidiaries.
Section 2.3. Governmental Authorizations, Etc. No consent,
approval or authorization of, or registration, filing or declaration with, any
Governmental Authority is required for the validity of the execution, delivery
or performance by either of the Obligors of this Supplemental Agreement.
Section 2.4. No Default, etc. No Event of Default or
Default has occurred and is continuing, and neither Obligor nor any of their
respective Subsidiaries is in default (whether or not waived) in the performance
or observance of any of the terms, covenants or conditions contained in any
instrument evidencing any Indebtedness and there is no pending request by the
Obligors (except pursuant to this Supplemental Agreement and the High Yield
Notes Consent Solicitation) or any of their respective Subsidiaries for any
amendment or waiver in respect of any contemplated or possible default with
respect to such Indebtedness and no event has occurred and is continuing which,
with notice or lapse of time or both, would become such a default.
Section 2.5. No Undisclosed Fees. Neither Obligor has,
directly or indirectly, paid or caused to be paid any consideration (as
supplemental or additional interest, a fee or otherwise) to any holder of Notes
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or other Indebtedness in order to induce such holder to enter into this
Supplemental Agreement or give its consent as requested by the High Yield Notes
Consent Solicitation or take any other action in connection with the
transactions contemplated hereby, nor has either Obligor agreed to make any such
payment, except as contemplated by the High Yield Notes Consent Solicitation and
Section 5.7 of this Supplemental Agreement.
SECTION 3.Representation of the Noteholder. You represent
to the Obligors that you are the beneficial owner of Notes of the series and in
the aggregate unpaid principal amount or amounts set forth below your name in
the acceptance form of this Supplemental Agreement.
Section 4.Amendments of Original Note Purchase Agreements,
Etc. The Original Note Purchase Agreements are amended pursuant to Section 18
thereof, as follows:
A. Section 1.3(b) is amended to read as follows:
"(b) The obligations of the Obligors hereunder
and under the Other Agreements (including without
limitation the obligations of Holding under the Parent
Guarantee) and the Notes will be unconditionally guaranteed
from time to time by certain Subsidiaries as provided in
Section 9.6, in each case pursuant to a subsidiary
guarantee substantially in the form of Exhibit 1.3
(individually a `SUBSIDIARY GUARANTEE' and collectively the
`SUBSIDIARY GUARANTEES')."
B. Section 9.6 is amended by changing the first sentence
thereof to read as follows:
"Forthwith after any Person becomes a Subsidiary (other than a
Non-Recourse Subsidiary or a Non-Guarantor Subsidiary) after July 1,
1999 or any other Subsidiary that at the time is a Non-Guarantor
Subsidiary becomes a guarantor of any Debt of an Obligor, the Company
will cause such Person or Subsidiary to execute and deliver a
Subsidiary Guarantee and promptly and in any event within ten
Business Days thereafter the Company will furnish each holder of the
Notes with a counterpart of such executed Subsidiary Guarantee,
together with an opinion of ▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP or other
counsel reasonably satisfactory to the Required Holders (which
opinion shall be reasonably satisfactory to the Required Holders and
may be subject to customary exceptions, qualifications and
limitations under the circumstances) to the effect that such
Subsidiary Guarantee has been duly authorized, executed and delivered
by such Subsidiary and is valid, binding and enforceable in
accordance with its terms."
C. A new Section 9.8 is added to read as follows:
"9.8. Lines of Business.
The Company and its Subsidiaries taken as a whole
will at all times remain principally engaged in the
business, or any business reasonably related thereto, in
which the Company and its Subsidiaries were engaged on the
date of this Agreement."
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D. Clause (i) of Section 10.6(b) is amended by changing
"Consolidated Net Income", appearing twice in said clause, to
"Adjusted Consolidated Net Income".
E. Section 10.7(d) is amended to read as follows:
"(d) in the case of any such transaction involving
a Subsidiary, if the surviving corporation is not the
Company or such Subsidiary, the surviving corporation (i)
shall be Controlled by the Company at least to the same
extent as such Subsidiary and (ii) shall either qualify as
a Non-Guarantor Subsidiary or have executed and delivered
to each holder of the Notes a Subsidiary Guarantee and
otherwise complied with the requirements of Section 9.6;"
F. Section 10.9 is amended to read as follows:
"10.9. Holding Business and Ownership of Assets.
Holding will not engage in any business and
will not own any assets other than the outstanding
common stock of the Company."
G. Schedule B is amended by adding new definitions of
"Adjusted Consolidated Net Income" and "Non-Guarantor Subsidiary" to
read respectively as follows:
"`ADJUSTED CONSOLIDATED NET INCOME' for any period
means Consolidated Net Income plus any amounts deducted
from gross revenues in determining such Consolidated Net
Income on account of special charges, costs and other
expenses (including restructuring charges and associated
investment banking, legal, accounting, printing and related
fees and expenses) recorded by the Company or any of its
Subsidiaries (other than Non-Recourse Subsidiaries), and
related tax effects, in connection with the merger of Armco
Inc. with and into the Company pursuant to an Agreement and
Plan of Merger dated as of May 20, 1999, as it may be
amended, among Holding, the Company and Armco Inc. and any
other merger or other business combination transaction
involving the Company or any Subsidiary (other than a
Non-Recourse Subsidiary), to the extent that any such
charges, costs and other expenses are not permitted under
GAAP to be capitalized and amortized over future periods,
in each case in respect of which the Company or Holding has
delivered to the holders of all Notes, at the time such
special charges, costs and other expenses are recorded, an
Officer's Certificate setting forth in reasonable detail
such special charges, costs and other expenses."
* * * *
"`NON-GUARANTOR SUBSIDIARY' means, at any date, a
Subsidiary (other than a Non-Recourse Subsidiary)
that is not a guarantor of any Debt of an Obligor."
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Section 5. Effectiveness of this Supplemental Agreement.
This Supplemental Agreement will become effective on the date (the "Effective
Date") on which all of the following conditions precedent shall have been
satisfied:
Section 5.1. Proceedings. All proceedings taken by the
Obligors in connection with the transactions contemplated hereby and all
documents and papers incident thereto shall be satisfactory to you, and you and
your special counsel shall have received all such counterpart originals or
certified or other copies of such documents and papers, all in form and
substance satisfactory to you, as you or they may reasonably request in
connection therewith.
Section 5.2. Execution of this Supplemental Agreement.
Counterparts of this Supplemental Agreement shall have been executed and
delivered by the Obligors and the Required Holders.
Section 5.3. Representations and Warranties. The
representations and warranties of the Obligors contained in Section 2 of this
Supplemental Agreement shall be true on and as of the Effective Date as though
such representations and warranties had been made on and as of the Effective
Date, and you shall have received a certificate of a senior financial officer of
each Obligor, dated the Effective Date, to such effect.
Section 5.4. Consummation of Merger. The Merger shall have
been consummated substantially in accordance with the terms of the Merger
Agreement.
Section 5.5. New Subsidiary Guarantee. A Subsidiary
Guarantee, dated on or before the Effective Date, shall have been executed and
delivered to you by ▇▇▇▇▇▇▇ Dynamics, L.L.C., substantially in the form of
Exhibit 1.3 to the Original Note Purchase Agreements, and the Company shall have
complied with the requirements of Section 9.6 of the Amended Note Purchase
Agreements in connection therewith.
Section 5.6. Opinion of Counsel. You shall have received an
opinion, dated the Effective Date, addressed to you and otherwise satisfactory
in scope and substance to you, from Weil, Gotshal & ▇▇▇▇▇▇ LLP, substantially in
the form set forth in Annex A attached hereto, and covering such other matters
incident to the transactions contemplated hereby as you may reasonably request.
Section 5.7. Payment of Fees. The Company shall have paid
(a) to you and each other holder of a Note, by wire transfer as provided in
Schedule A to the Original Note Purchase Agreements (or to you in such other
manner or to such other address as you shall have specified in writing to the
Company at least one Business Day before the Effective Date) an amendment fee
equal to the greater of (i) 0.125% of the unpaid principal amount of the Notes
respectively held by you and such other holder as set forth below your and their
names in the acceptance form of this Supplemental Agreement and (ii) the highest
consent fee (expressed as a percentage of the unpaid principal amount of the
affected senior notes) paid by either Obligor in connection with the High Yield
Note Consent Solicitations, and (b) the fees and disbursements of your special
counsel as contemplated by Section 6 of this Supplemental Agreement.
At least one Business Day prior to the date on which the
Company proposes to pay the amendment fee pursuant to this Section 5.7, the
Company will advise Credit Suisse First Boston ("CFSB") of the date of such
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anticipated payment and request that CFSB communicate that information (either
orally or in any manner contemplated by Section 19 of the Original Note Purchase
Agreements) to you and each other holder of a Note, provided that (a) the
communication of that information shall not be deemed a condition precedent to
the effectiveness of this Supplemental Agreement and (b) the failure on the part
of the Company to so advise CFSB or CFSB to communicate that information to the
holders of the Notes shall not, in either case, be deemed to constitute a breach
of this Supplemental Agreement or the Amended Note Purchase Agreement for any
purpose whatsoever or otherwise give rise to any liability on the part of the
Company or CFSB in favor of you or any other holder of the Notes.
Section 6.Expenses. Without limiting the generality of
Section 16.1 of the Amended Note Purchase Agreements, the Company agrees,
whether or not the transactions contemplated hereby are consummated, to pay the
reasonable fees and disbursements of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, your special
counsel, for their services rendered in connection with such transactions and
with respect to this Supplemental Agreement and any other document delivered
pursuant to this Supplemental Agreement and reimburse you for your reasonable
out-of-pocket expenses in connection with the foregoing.
In furtherance of the foregoing, on the Effective Date the
Company will pay or cause to be paid the reasonable fees and disbursements of
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ which are reflected in the statement of ▇▇▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ delivered to the Company prior to the Effective Date. The Company will
also pay promptly upon receipt of supplemental statements therefor, reasonable
additional fees, if any, and disbursements of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ in
connection with the transactions contemplated hereby (including disbursements
unposted as of the Effective Date).
Section 7.Ratification. Except as amended hereby, the
Original Note Purchase Agreements are in all respects ratified and confirmed and
the provisions thereof shall remain in full force and effect.
Section 8.Counterparts. This Supplemental Agreement may be
executed in two or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument.
Section 9.Governing Law. This Supplemental Agreement shall
be governed by and construed in accordance with the laws of the State of New
York.
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If you are in agreement with the foregoing, please sign the
form of acceptance in the space below provided, whereupon this Supplemental
Agreement shall become a binding agreement between you and the Company and
Holding, subject to becoming effective as hereinabove provided.
AK STEEL CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------
Vice President, Treasurer
and Chief Financial Officer
AK STEEL HOLDING CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------
Vice President, Treasurer
and Chief Financial Officer
ACCEPTED AND AGREED:
NOTEHOLDERS:
TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Managing Director
Principal Amount of Notes Held: $50,000,000 (Series A)
Principal Amount of Notes Held: $50,000,000 (Series E)
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Managing Director
Principal Amount of Notes Held: $9,875,000 (Series B)
Principal Amount of Notes Held: $9,875,000 (Series E)
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MASSMUTUAL CORPORATE VALUE PARTNERS LIMITED
By MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY, ITS INVESTMENT MANAGER
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Managing Director
Principal Amount of Notes Held: $1,500,000 (Series B)
Principal Amount of Notes Held: $1,500,000 (Series E)
CM LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Managing Director
Principal Amount of Notes Held: $1,125,000 (Series B)
Principal Amount of Notes Held: $1,125,000 (Series E)
THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Authorized Representative
Principal Amount of Notes Held: $12,500,000 (Series A)
Principal Amount of Notes Held: $12,500,000 (Series E)
LIFE INSURANCE COMPANY OF GEORGIA
By ING INVESTMENT MANAGEMENT LLC, ITS AGENT
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------
Vice President
Principal Amount of Notes Held: $2,500,000 (Series A)
Principal Amount of Notes Held: $2,500,000 (Series D)
SOUTHLAND LIFE INSURANCE COMPANY
By ING INVESTMENT MANAGEMENT LLC, ITS AGENT
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------
Vice President
Principal Amount of Notes Held: $2,500,000 (Series A)
Principal Amount of Notes Held: $2,500,000 (Series D)
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SECURITY LIFE OF DENVER INSURANCE COMPANY
By ING INVESTMENT MANAGEMENT LLC, ITS AGENT
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------
Vice President
Principal Amount of Notes Held: $2,500,000 (Series A)
Principal Amount of Notes Held: $2,500,000 (Series D)
Principal Amount of Notes Held: $6,000,000 (Series E)
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY
By /s/ C. ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Investment Officer
Principal Amount of Notes Held: $2,500,000 (Series C)
Principal Amount of Notes Held: $12,500,000 (Series E)
THE FRANKLIN LIFE INSURANCE COMPANY
By /s/ C. ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Investment Officer
Principal Amount of Notes Held: $10,000,000 (Series C)
ALLSTATE LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Authorized Signatory
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Authorized Signatory
Principal Amount of Notes Held: $15,000,000 (Series E)
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CONNECTICUT GENERAL LIFE INSURANCE COMPANY
By CIGNA INVESTMENTS, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Managing Director
Principal Amount of Notes Held: $3,500,000 (Series C)
Principal Amount of Notes Held: $3,500,000 (Series E)
LIFE INSURANCE COMPANY OF NORTH AMERICA
By CIGNA INVESTMENTS, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------
Managing Director
Principal Amount of Notes Held: $1,000,000 (Series C)
Principal Amount of Notes Held: $1,000,000 (Series E)
▇▇▇▇ ▇▇▇▇▇▇▇ MUTUAL LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Second Vice President
Principal Amount of Notes Held: $4,000,000 (Series E)
PRINCIPAL MUTUAL LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
--------------------------------------
Counsel
By /s/ ▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
Counsel
Principal Amount of Notes Held: $10,000,000 (Series A)
Principal Amount of Notes Held: $10,000,000 (Series E)
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THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By: Lincoln Investment Management Inc.,
its Attorney-in-Fact
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
--------------------------------------
Second Vice President
Principal Amount of Notes Held: $3,000,000 (Series C)
Principal Amount of Notes Held: $3,000,000 (Series E)
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ANNEX A
(to Supplemental Agreement)
OPINION OF COUNSEL FOR THE COMPANY
The following opinions are to be provided by counsel for
the Company, subject to customary assumptions, limitations and qualifications.
All capitalized terms used herein without definition shall have the meanings
ascribed thereto in the Supplemental Agreement.
Each Obligor is a corporation validly existing
under the laws of the State of Delaware and has all
requisite power and authority to execute and deliver the
Supplemental Agreement and to perform the provisions
thereof.
The Supplemental Agreement has been duly
authorized, executed and delivered by the Obligors and
constitutes a legal, valid and binding agreement of the
Obligors, enforceable against the Obligors in accordance
with its terms.
No consent, approval or authorization of, or
registration, filing or declaration with, any Governmental
Body is required on the part of either Obligor for the
validity of the execution and delivery or for the
performance by the Company of the Supplemental Agreement,
except for federal and state securities or blue sky laws,
as to which we express no opinion, and those already
obtained.
The consummation of the transactions contemplated
by the Supplemental Agreement and the performance of the
terms and provisions of the Supplemental Agreement do not
and will not (i) conflict with the Certificate of
Incorporation or by-laws of either Obligor or their
respective Subsidiaries, (ii) result in any breach of, or
constitute a default under, or result in the creation of
any Lien in respect of any property of either Obligor or
their respective Subsidiaries under, any material
indenture, mortgage, deed of trust, bank loan or credit
agreement, or other material agreement or instrument known
to us, after due inquiry, to which either Obligor or their
respective Subsidiaries is a party or by which either
Obligor or their respective Subsidiaries or any of their
respective properties may be bound or affected, or (iii)
conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree or
ruling of any court, arbitrator or Governmental Authority
applicable to either Obligor or their respective
Subsidiaries and known to us or violate any provision of
any law, statute, rule or regulation of any Governmental
Authority applicable to either Obligor or their respective
Subsidiaries.
[Opinions pursuant to Section 9.6 regarding the
Subsidiary Guarantee of ▇▇▇▇▇▇▇ Dynamics, L.L.C.]
* * * *
This opinion is given solely for your benefit, and for the
benefit of the institutional investor holders from time to time of the Notes
held by you, in connection with the transactions contemplated by the
Supplemental Agreement, and may not be relied upon by any other person for any
purpose without our prior written consent.
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