- 27 -
P128751.1
GERMAN SECURITY AGREEMENT
as between
ABN AMRO BANK N.V., AUSTRALIAN BRANCH
(hereinafter "Lender")
and
DENTSPLY INTERNATIONAL INC.
(hereinafter "Debtor")
and
DEGUSSA DENTAL GMBH & CO KG
(hereinafter "Degussa")
and
CERAMCO, INC.
(hereinafter "Ceramco")
and
ELEPHANT DENTAL B.V.
(hereinafter "Elephant")
dated as of
______________, 2005
1. Preamble
Whereas the Lender and the Debtor have entered into a certain Consignment
Agreement as of today's date.
Whereas the Lender and the Debtor are also, among other parties, parties to a
certain Intercreditor and Collateral Sharing Agreement;
Whereas pursuant to the Consignment Agreement the Lender has undertaken to
consign and deliver certain volumes of Precious Metal (as such term is defined
in the Consignment Agreement) to Debtor (hereinafter the "Lender Precious
Metal") and whereas the Debtor is allowed to use such Lender Precious Metal in
the ordinary course of its business and in particular to consign it to Degussa,
Ceramco, and Elephant (hereinafter together referred to the "Dentsply
Subsidiaries").
Whereas fulfilment by the Debtor of its obligations under the Consignment
Agreement shall be secured, inter alia, by (i) a retention of title by the
Lender of the Lender Precious Metal and (ii) an assignment by the Debtor to the
Lender of certain receivables.
Whereas it is the Lender's intention to further reinforce this retention of
title by way of this Security Agreement and whereas the Debtor is willing to
enter into this Security Agreement;
Now, theretofore, for good and valid consideration the receipt of which is
hereby acknowledged the parties hereto agree as follows:
2. Retention of Title; Joint Ownership
2.1 Title to any Lender Precious Metal shall remain with and vested in the
Lender until such time when all of the Obligations (as such term is
defined in the Consignment Agreement) have been repaid by the Debtor
(erweiterter Eigentumsvorbehalt).
2.2 In the event that the Lender Precious Metal shall be used by the Debtor
in its ordinary course of business this retention of title shall
continue in any endproduct in which the Precious Metal may have been
integrated, transformed, processed or otherwise used (the
"Endproduct"). The Lender and the Debtor in relation to such Endproduct
shall be joint owners with each party having a portion of ownership
equal to the value of the respective party's contribution to the
Endproduct (verlangerter Eigentumsvorbehalt). The preceding sentence
notwithstanding the Lender's portion of ownership in the Endproduct
shall in no event be less than 74 per cent.
3. Storage of Precious Metal
3.1 The Lender will deliver to the Debtor (at the Debtor's risk) the Lender
Precious Metal to the Approved Location (as such term is defined in the
Consignment Agreement) identified hereto in Annex 1.
3.2 If reasonably possible, the Debtor shall store the Lender Precious
Metal within the Approved Location separately from any other Precious
Metal stored in the Approved Location. The Debtor shall further insure
that, as far as reasonably possible, in the event of an integration,
transformation, processing or use of the Lender Precious Metal in or in
the context of an Endproduct, the Debtor will use only the Lender
Precious Metal to the exclusion of any other Precious Metal shall be
used.
3.3 It is understood and agreed between the Lender and the Debtor that
until such time as the Debtor has further sold or processed the Lender
Precious Metal as set forth above the Lender shall continue to have
full ownership rights in the Lender Precious Metal, subject only to the
terms of the Consignment Agreement, this Agreement and any other
documentation pertaining to the transaction described herein. In the
event that the Lender Precious Metal cannot be distinguished from other
Precious Metal stored in the Approved Location, if any, or that the
Lender Precious Metal has been mingled before then the Lender shall,
subject to the terms of the Intercreditor Agreement, be deemed to have
an ownership interest corresponding to the Pro-Rata-Share (as such term
is defined in the Intercreditor Agreement) in all of the Precious Metal
stored in the Approved Location, regardless of such Precious Metal
being Lender Precious Metal or other Precious Metal.
3.4 It is understood between the parties that nothing contained herein
shall limit the Debtor in its use of the Lender Precious Metal in its
ordinary course of business for the creation of an Endproduct.
4. Authority to Use; Assignment of Receivables
4.1 The Lender hereby grants to the Debtor the authority pursuant to
Section 185 para 1 of the German Civil Code (Burgerliches Gesetzbuch)
to sell the Endproducts to third parties provided that (i) such sale
occurs in the ordinary course of business, (ii) the buyer of the
Endproduct has in the past paid its bills in full when due and (iii)
the Debtor is not prohibited from assigning to the Lender any claims
that the Debtor may have against the third party and relating to the
Endproduct.
4.2 The Debtor hereby irrevocably assigns (Abtretung) to the Lender any and
all rights or claims against third parties that it has or in the future
may have from or in relation to any Endproduct (the "Assigned Rights").
Comprised in this assignment are, without limitation, claims for
purchase price, damage claims or other statutory or contractual claims.
4.3 Upon repayment of the Obligations in full, the Lender undertakes
to re-assign the Assigned Rights to the
Debtor.
4.4 The Lender hereby grants to the Debtor the - revocable - authority to
collect any amounts owed by third parties from the sale of the
Endproducts until the earlier of (i) the revocation by the Lender of
the authority granted herein or (ii) the occurrence of an Event of
Default (as such term is defined in the Consignment Agreement).
5. Dentsply Subsidiaries Consignment
5.1 It is understood that the Debtor will and is entitled to consign the
Lender Precious Metal to the Dentsply Subsidiaries pursuant to that
certain Subsidiary Consignment Agreement (as such term is defined in
the Consignment Agreement). The Dentsply Subsidiaries in signing this
present Security Agreement hereby agree to be bound by the terms hereof
in relation to any and to undertake all obligations contained herein in
relation to such Lender Precious Metal and the Lender hereby grants to
the Dentsply Subsidiaries the rights granted to the Debtor hereunder in
relation to such Lender Precious Metal as is consigned to the Dentsply
Subsidiaries.
5.2 The consignment of the Lender Precious Metal to the Dentsply
Subsidiaries shall in particular (i) not lead to a invalidation of the
retention of title as provided herein in Sections 2.1 and 2.2 and (ii)
any further disposal by the Dentsply Subsidiaries of the Lender
Precious Metal assigned to it may only occur under the same conditions
as apply to any such disposal by the Debtor pursuant to Sections 2.2,
4.1 and 4.2 hereof.
6. Governing Laws; Place of Jurisdiction
This Security Agreement shall be governed by and interpreted in
accordance with German law. Non-exclusive place of jurisdiction for the
Lender and exclusive place of jurisdiction for the Debtor for any
disputes arising out of or in relation to this Agreement is Munich,
Germany. Furthermore, the Lender is granted the right to initiate legal
proceedings or file for other legal protection or remedies, including
injunctive relief, at the Debtor's or any of its Subsidiaries'
principle place of business, as well as before any other court having a
factual relation or connection to the security granted to Lender
hereunder. The Debtor shall be required, upon the Lender's request, to
nominate and irrevocably designate a person acceptable to the Lender
and domiciled in Germany to act as the Debtor's non-exclusive recipient
and process agent for all types of service within the framework of the
legal proceedings.
7. General Provisions
7.1 The Lender shall have the unrestricted right at any time or from time
to time, with the Debtor's consent (such consent shall only be required
provided that no Event of Default has occurred and is then continuing),
which shall not be unreasonably withheld, to assign all or any portion
of its rights and obligations hereunder to one or more banks or other
financial institutions (each, an "Assignee"), and Debtor agrees that it
shall execute, or cause to be executed, such documents, including
without limitations, amendments to this Agreement and to any other
documents, instruments and agreements executed in connection herewith
as the Lender shall deem necessary to effect the foregoing.
7.2 The Debtor shall not be entitled to assign any rights or obligations
under this Security Agreement to any third party without the Lender's
prior written consent.
7.3 All notices and other communications hereunder shall be in writing,
except as otherwise provided in this Agreement; and shall be sent by
any one of the following: certified mail, return receipt requested;
overnight courier; confirmed telecopier: or by hand and shall addressed
(i) if to the Debtor, to it at the Debtor's Address and (ii) if to the
Lender, to it at the Lender's Address. Notices shall be deemed
effective three (3) days after deposit in the mail, if sent by
certified mail; the next Business Day, if sent by overnight courier;
upon confirmation, if sent by confirmed telecopier; and upon delivery,
if sent by hand. The address of any party hereto for such demands,
notices and other communications may be changed by giving notice in
writing at any time to the other party hereto
7.4 No modification or waiver of any provision of this Agreement, nor
consent to any departure by the Debtor therefrom, shall in any event be
effective unless the same shall be in writing, and then such waiver or
consent shall be effective only in the specific instance, and for the
purpose, for which given. No notice to, or demand, on the Debtor, in
any case, shall entitle the Debtor to any other or future notice or
demand in the same, similar or other circumstances.
7.5 Neither any failure or any delay on the part of the Lender in
exercising any right, power or privilege hereunder or under any other
instrument given as 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 right, power or
privilege
7.6 This Agreement may not be amended or modified except by a written
instrument describing such amendment or modification executed by the
Debtor and Lender.
7.7 Should individual provisions of this Security Agreement be or become
invalid and/or unenforceable, the remainder of the Agreement shall
remain unaffected thereby. In this case, the invalid or unenforceable
provision shall be re-interpreted in such a way or replaced by such a
provision that most closely achieves the economic purpose intended by
the invalid/unenforceable provision. The same applies in case of an
ambiguity, mutual mistake, or a gap in the terms contained in this
Agreement.
7.8. All capitalized terms used herein not otherwise defined herein shall
have the meanings assigned by the Consignment Agreement.
The next page is a signature page
[Date/Place]________________
DENTSPLY INTERNATIONAL INC.
-----------------
For Debtor
[Date/Place]________________
DEGUSSA DENTAL GMBH
-----------------
For Degussa
[Date/Place]________________
CERAMCO, INC.
-----------------
For Ceramco
[Date/Place]________________
ELEPHANT DENTAL B.V.
-----------------
For Elephant
[Date/Place]________________
ABN AMRO BANK N.V., AUSTRALIAN BRANCH
-----------------
For Lender
CONSIGNMENT AGREEMENT
CONSIGNMENT AGREEMENT, dated as of December 15, 2006, by and between
ABN AMRO BANK N.V., AUSTRALIAN BRANCH, with offices at Level 5, ABN AMRO Tower,
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ (the "Consignor"), and DENTSPLY
INTERNATIONAL INC., a Delaware corporation with its principal place of business
at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Company").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Company uses certain commodities in its business; and
WHEREAS, the Consignor has agreed to consign such commodities to the
Company on the terms and conditions and in reliance upon the representations and
warranties of the Company hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and of the mutual
promises hereinafter contained, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. DEFINITIONS
When used herein, the terms set forth below shall be defined as follows:
1.1. "Approved Locations" means (a) the premises of the
Company at the Company's Address; (b) the premises of
the Company's Subsidiaries at the addresses set forth
in Exhibit C attached hereto; and (c) such other
locations of the Company's Subsidiaries as may be
agreed upon from time to time in writing by FPM, on
behalf of the Consignor and the Other Consignors;
provided, however, FPM, on behalf of the Consignor
and the Other Consignors, shall have the right to
give written notice to the Company that a location,
whether now or hereafter approved, is no longer an
Approved Location.
1.2. "Authorized Representatives" means all person(s) who
are authorized by and on behalf of the Company (a) to
transact consignment and purchase and sale
transactions with the Consignor under the Consignment
Facility; and (b) to request that a consignment under
the Consignment Facility be continued as such.
1.3. "Bank" means Bank of America, National Association, a
national association and successor in interest to
Fleet National Bank, a national banking association.
1.4. "Business Day" means a day on which commercial
banks settle payments in (a) London, if the payment
obligation is calculated by reference to any LIBOR
Rate, or (b) New York, for all other payment
obligations; an adjustment will be made if a date
would otherwise fall on a day that is not a Business
Day so that the date will be the first following day
that is a Business Day except as otherwise set forth
herein. 1.5. "Collateral Assignment" means that
certain Collateral Assignment of the Subsidiary
Consignment Agreement dated December 20, 2001 by the
Company in favor of FPM, as agent for Consignor and
the Other Consignors, as amended from time to time,
whereby the Company has collaterally assigned all its
rights, title and interest in and to the Subsidiary
Consignment Agreement to FPM, for the benefit of the
Consignor and the Other Consignors, and which secure,
inter alia, the payment and performance of the
Obligations.
1.6. "Company" means Dentsply International Inc., a
Delaware corporation.
1.7. "Company's Address" means ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇.
1.8. "Consigned Precious Metal" means Precious Metal which
has been consigned to the Company by the Consignor
pursuant to the Consignment Facility.
1.9. "Consignment Facility" means the facility under
Paragraph 2 hereof whereby the Company may request
consignments of Precious Metal. 1.10. "Consignment
Facility Indebtedness" means the value (as determined
in accordance with Paragraph 2.2 hereof) of Precious
Metal on consignment to the Company under the
Consignment Facility. 1.11. "Consignment Limit"
means:
(a) Twenty-Two Million Dollars ($22,000,000); or (b) such
limit as the Consignor and the Company may agree
upon from time to time as evidenced by an amendment
in substantially the form of Exhibit B attached
hereto and made a part hereof or in such other form
as the Consignor shall require, with a copy to FPM in
any case; or
(c) such other limit as the Consignor may approve in its
sole discretion.
1.12. "Consignment Period" means, with respect to the
consignment of Precious Metal based upon a Fixed
Consignment Fee, the period beginning on the Drawdown
Date and ending on the day which numerically
corresponds to such date one (1), two (2), three (3),
six (6) or twelve (12) months (or such other period,
if agreed to by the Consignor) thereafter (or, if
such month has no numerically corresponding day, on
the last London Banking Day of such month), as the
Company may select in its relevant notice pursuant to
Paragraph 2.4 or 2.5; provided, however, that, if
such Consignment Period would otherwise end on a day
which is not a London Banking Day, such Consignment
Period shall end on the next following London Banking
Day; provided, however, that if such next following
London Banking Day is the first London Banking Day of
a calendar month, such Consignment Period shall end
on the next preceding London Banking Day.
1.13. "Consignor" means ABN AMRO Bank N.V., Australian
Branch.
1.14. "Consignor's Address" means Level 5, ABN AMRO Tower,
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇. 1.15.
"Credit Agreement" means that certain 364-Day
Competitive Advance, Revolving Credit and Guaranty
Agreement dated May 25, 2001 among the Company, the
Guarantors (as defined therein), the Banks from time
to time party thereto, ABN AMRO Bank N.V., as
Administrative Agent for the Banks and arranger and
bookrunner and Credit Suisse First Boston and Bank of
Tokyo-Mitsubishi Trust Company, as Co-Syndication
Agents, and First Union National Bank and ▇▇▇▇▇▇
Trust and Savings Bank, as Co-Documentation Agents.,
as amended from time to time.
1.16. "Dentsply Subsidiaries" means Degussa Dental GmbH, a
German limited liability company and
successor-in-interest to Degussa Dental GmbH & Co KG,
and wholly owned by the Company; Ceramco, Inc., a
Delaware corporation and a wholly owned subsidiary of
the Company; and Elephant Dental B.V., a corporation
organized under the laws of The Netherlands and a
wholly owned subsidiary of the Company.
1.17. "Drawdown Date" means, with respect the Consignment
Facility, the date on which any consignment under the
Consignment Facility is made or is to be made and the
date on which any consignment under the Consignment
Facility is continued in accordance with Paragraph
2.5 hereof.
1.18. "Event of Default" means each and every event
specified in Paragraph 8.1 of this Agreement.
1.19. "FPM" means Fleet Precious Metals Inc., a Rhode
Island corporation.
1.20. "Financial Statements" means (a) the audited balance
sheet of the Company as at December 31, 2004 and the
statements of income and retained earnings of the
Company for the year ended on such date prepared and
certified by independent certified public
accountants; and (b) a balance sheet of the Company
as at June 30, 2005, and combined profit and loss and
surplus statements of the Company for the period then
ended, together with supporting schedules, prepared
on a review basis by independent certified public
accountants.
1.21. "Fiscal Year" means the year ending December 31.
1.22. "Fixed Consignment Fee" means a consignment fee
calculated in accordance with the provisions of
Paragraph 2.3(c) hereof. 1.23. "Fixed Rate
Consignment" means the consignment of Precious Metal
by the Consignor to the Company under the Consignment
Facility which bears a Fixed Consignment Fee.
1.24. "Following Business Day Convention" shall mean that
an adjustment will be made if any relevant date would
otherwise fall on a day that is not a Business Day so
that the date will be the first following day that is
a Business Day.
1.25. "GAAP" means generally accepted accounting principles
consistently applied.
1.26. "Intercreditor and Collateral Sharing Agreement"
means that certain Intercreditor and Collateral
Sharing Agreement entered into by the Consignor and
the Other Consignors with respect to the Company,
dated as of December 27, 2001, as the same may be
amended from time to time, which Intercreditor and
Collateral Sharing Agreement shall be satisfactory to
the Consignor in all respects in its sole discretion.
1.27. "Inventory" means all inventory (as defined in
Section 9-109(4) of the Uniform Commercial Code)
goods, merchandise and other personal property,
wherever located, now owned or hereafter acquired by
the Company which are held for sale or lease, or
furnished or to be furnished under any contract of
service or are raw materials, work in process,
supplies or materials used or consumed in the
Company's business, and all products thereof, and
substitutions, replacements, additions or accessions
thereto, all cash or non-cash proceeds of all of the
foregoing including insurance proceeds.
1.28. "Laws" means all applicable ordinances, statutes,
rules, regulations, orders, injunctions, writs or
decrees of any government or political subdivision or
agency thereof, or any court or similar entity
established by any thereof.
1.29. "Lenders" means all lenders who are or were parties
to the Credit Agreement from time to time. 1.30.
"London Banking Day" means any day on which
commercial banks are open for international business
(including dealings in dollar deposits) in London.
1.31. "Metals Report" means a Precious Metal report of the
Company which shall identify Precious Metal by
location and which shall identify all liabilities to
third parties for toll or other third party Precious
Metal by location and by third party and otherwise to
be in form acceptable to the Consignor, certified by
a financial officer of the Company.
1.32. "Obligations" means any and all indebtedness,
obligations and liabilities of the Company to the
Consignor of every kind and description, direct or
indirect, secured or unsecured, joint or several,
absolute or contingent, due or to become due, whether
for payment or performance, now existing or hereafter
arising under this Agreement, including, without
limitation, all indebtedness and obligations under
the Consignment Facility extended to the Company
hereunder; and all interest, taxes, fees, charges,
expenses and attorneys' fees chargeable to the
Company or incurred by the Consignor hereunder, or
any other document or instrument delivered hereunder
or as a supplement hereto.
1.33. "Other Consignors" means all suppliers, lenders,
consignors or financial institutions who enter into
consignment agreements with the Company pursuant to
which such supplier, lender, consignor or financial
institution agrees to consign Precious Metal to the
Company and who become parties to the Intercreditor
and Collateral Sharing Agreement.
1.34. "Other Consignment Agreements" means those certain
Consignment Agreements or Consignment and Forward
Contract Agreements entered into by and between the
Other Consignors and the Company from time to time,
as the same may be amended from time to time.
1.35. "Other Consignors' Precious Metal" means all Precious
Metal consigned to the Company by the Other
Consignors pursuant to the Other Consignment
Agreements. 1.36. "Permitted Liens" means, so long as
execution thereon has been stayed:
(a) Liens for taxes, assessments, or similar charges,
incurred in the ordinary course of business, which
either are not yet due or are being contested in good
faith by appropriate proceedings, and as to which the
Company shall have set aside adequate reserves;
(b) Pledges or deposits made in the ordinary course of
business to secure payment of workmen's compensation,
or to participate in any fund in connection with
workmen's compensation, unemployment insurance,
old-age pensions or other social security programs;
(c) Liens of mechanics, materialmen, warehousemen,
carriers, or other like liens, securing obligations
incurred in the ordinary course of business that are
not yet due and payable;
(d) Good faith pledges or deposits made in the ordinary
course of business to secure performance of bids,
tenders, contracts (other than for the repayment of
borrowed money) or leases, not in excess of ten
percent (10%) of the aggregate amount due thereunder,
or to secure statutory obligations, or surety,
appeal, indemnity, performance or other similar bonds
required in the ordinary course of business;
(e) Encumbrances consisting of zoning restrictions,
easements, or other restrictions on the use of real
property, none of which materially impairs the use of
such property by the Company or any Subsidiary in the
operation of its business, and none of which is
violated in any material respect by existing or
proposed structures or land use; and
(f) Liens in favor of the Consignor and the Other
Consignors.
1.37. "Person" means an individual, corporation,
partnership, limited liability company, joint
venture, trust, or unincorporated organization. 1.38.
"Precious Metal" means:
(a) gold bullion, having a minimum degree of fineness of
ninety-nine and 50/100 percent (99.5%), or being of
such quality and in such form the delivery of which
would be (i) settlement conforming in all respects
with the requirements of the London Bullion Market
Association for "international good delivery," or
(ii) acceptable in internationally recognized
terminal markets mutually acceptable to the Consignor
and the Company; and
(b) silver bullion, having a minimum degree of fineness
of ninety-nine and 90/100 percent (99.90%), or being
of such quality and in such form the delivery of
which would be (i) settlement conforming in all
respects with the requirements of the London Bullion
Market Association for "international good delivery,"
or (ii) acceptable in internationally recognized
terminal markets mutually acceptable to the Consignor
and the Company; and
(c) platinum plate, having a fineness of not less than
ninety-nine and 95/100 percent (99.95%), or being of
such quality and in such form the delivery of which
would be (i) settlement conforming in all respects
with the requirements of the London Platinum and
Palladium Market for "international good delivery,"
or (ii) acceptable in internationally recognized
terminal markets mutually acceptable to the Consignor
and the Company; and
(d) palladium plate, having a fineness of not less than
ninety-nine and 95/100 percent (99.95%), or being of
such quality and in such form the delivery of which
would be (i) settlement conforming in all respects
with the requirements of the London Platinum and
Palladium Market for "international good delivery,"
or (ii) acceptable in internationally recognized
terminal markets mutually acceptable to the Consignor
and the Company.
1.39. "Premises" means all real estate owned, used or
leased by the Company or by any of the Company's
Subsidiaries including, without limitation, the
Dentsply Subsidiaries. 1.40. "Prime Rate" means the
rate of interest designated by Bank from time to time
as being its so-called "prime rate" of interest. The
Prime Rate is a reference rate and does necessarily
represent the lowest or best rate being charged to
any customer. Changes in the rate of interest
resulting from changes in the Prime Rate shall take
place immediately without notice or demand of any
kind.
1.41. "Security Agreement" means the German Security
Agreement dated on or about the date hereof of the
Company in favor of the Consignor, as amended from
time to time, which secures the payment and
performance of the Obligations under German law.
1.42. "Subsidiary" means any corporation of which more than
fifty (50%) percent of the outstanding voting
securities shall, at the time of determination, be
owned by the Company directly or indirectly through
one or more Subsidiaries.
1.43. "Subsidiary Consignment Agreement" means that certain
Consignment and Forward Contracts Agreement dated
December 20, 2001, as amended from time to time, by
and between the Company and the Dentsply Subsidiaries
whereby the Company shall consign the Consigned
Precious Metal and the Other Consignors' Precious
Metal to the Dentsply Subsidiaries, and all
agreements executed or delivered in connection
therewith, and all security therefor.
To the extent not defined in this Paragraph l, unless the context
otherwise requires, accounting and financial terms used in this Agreement shall
have the meanings attributed to them by GAAP, and all other terms contained in
this Agreement shall have the meanings attributed to them by Article 9 of the
Uniform Commercial Code in force in the State of New York, as of the date hereof
to the extent the same are used or defined therein.
2. CONSIGNMENT FACILITY.
2.1. Precious Metal to be Consigned; Insurance; Title
(a) The Precious Metal to be consigned to the Company by the Consignor under
Consignment Facility will consist of Precious Metal as defined herein. EXCEPT AS
PROVIDED IN THE PRECEDING SENTENCE OF THIS PARAGRAPH 2.1(A), THE CONSIGNOR MAKES
NO REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, WITH RESPECT TO
THE GOODS CONSIGNED OR TO BE SOLD HEREUNDER, WHETHER AS TO MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER MATTER, AND THE CONSIGNOR HEREBY
DISCLAIMS ALL SUCH WARRANTIES.
(b) The Consigned Precious Metal shall be consigned to the Company by the
Consignor, in the Consignor's sole discretion, in amounts as requested by the
Company from time to time, provided that no Event of Default has occurred and is
then continuing. It is understood that at no time shall the Consignment Facility
Indebtedness exceed the Consignment Limit.
(c) All deliveries requested by the Company of Consigned Precious Metal shall be
made at the Company's expense and risk by a recognized reputable carrier of the
Consignor's selection. Following the delivery of Consigned Precious Metal to the
Company, or to such other location as may be agreed upon from time to time by
the parties hereto, the Company shall insure the Consigned Precious Metal to its
full value against all risks of loss and shall, as between the Consignor and the
Company, accept all risk of loss until its return to the Consignor, as
hereinafter provided. All such insurance policies shall provide at least thirty
(30) days' prior written notice to the Consignor of any cancellation or
alteration thereof. At the Consignor's request, the Company will furnish the
Consignor with the certificate of an insurance company reasonably satisfactory
to the Consignor and a true and complete copy of all insurance policies
evidencing the satisfaction of the Company's insurance obligations hereunder and
the inclusion of FPM, as agent for Consignor and the Other Consignors, as an
additional insured and loss payee under any applicable policy as its interest
may appear; provided, however, that the Consignor shall be under no duty either
to ascertain the existence of or to examine any such policy or certificate or to
advise the Company in the event such policy shall not comply with the
requirements hereof.
(d) Title to all Consigned Precious Metal shall remain in the Consignor until
such Consigned Precious Metal is purchased and withdrawn from consignment by the
Company, and Precious Metal shall for the purposes of this Agreement be deemed
to be outstanding on consignment until it is paid for in full by the Company as
provided in Paragraph 2.3(e) hereof, whereupon title to such purchased Precious
Metal shall pass to the Company. The Company authorizes the Consignor to file
such financing statements and other documents as may be reasonably requested by
the Consignor to protect the Consignor's interests as a consignor and a secured
party under the Uniform Commercial Code. (e) The Company shall pay all license
fees, assessments and sales, use, excise, property and other taxes now or
hereafter imposed by any governmental body or authority with respect to the
possession, use, sale, transfer, consignment, delivery or ownership of the
Consigned Precious Metal.
(f) The Consignor shall not be liable for any delay in delivery or for any
inability to deliver Precious Metal hereunder directly or indirectly resulting
from any unavailability or scarcity of precious metals, foreign or domestic
embargoes, seizure, acts of God, insurrections, strikes, war, the adoption or
enactment of any law, ordinance, regulation, ruling or order directly or
indirectly interfering with the production, sale, consignment or delivery of
Precious Metal hereunder, lack of transportation, fire, flood, explosions or
other accidents, events or contingencies beyond the Consignor's reasonable
control.
(g) The parties hereto hereby acknowledge, confirm and agree that the foregoing
description of the form and manner in which Precious Metal will be consigned and
delivered pursuant to this Agreement is intended to make clear that the
Consignor is obligated to engage only in transactions involving Precious Metal
in quantities and units which it customarily maintains in its regular inventory,
but is not intended to limit such form and manner in the event that the
Consignor shall agree separately to engage in other types of transactions.
Without limiting the generality of the foregoing, Precious Metal in the
possession or control of the Company, or Precious Metal held by a third party
for the account of the Company, shall constitute Precious Metal consigned
pursuant to this Agreement notwithstanding that (i) such Precious Metal is in
alloyed form or is contained in raw materials, work-in-process, or finished
goods, (ii) such Precious Metal was delivered to, or credited to the account of,
the Company by a third party in exchange for or in consideration of Precious
Metal delivered by the Consignor to such third party, (iii) such Precious Metal
was sold by the Company to the Consignor and then consigned back to the Company
pursuant to this Agreement, or (iv) such Precious Metal is demonstrably not the
Precious Metal physically delivered by the Consignor.
2.2. Valuation
For the purpose of this Agreement, the value of the Consigned Precious
Metal shall be determined (a) on the basis of the London Bullion Brokers' second
fixing price on the valuation date in the case of gold, platinum and palladium,
and (b) on the basis of the London Bullion Brokers' fixing price, in the case of
silver, or, in any case if no price is available for such date, then on the
basis of said second fixing price or fixing price, as applicable, on the next
previous day for which such price was available. In the event that the London
Bullion Brokers shall discontinue or alter its usual practice of quoting a price
for gold, platinum, palladium or silver, as applicable, on any day for which
such a price is necessary for the purposes hereof, the Consignor shall so notify
the Company and the Consignor shall at its option announce a substituted index
or mechanism which shall thereupon become the method of valuation hereunder.
2.3. Payments by the Company. (a) During such time as Precious Metal is
consigned (or is deemed to be consigned
under this Agreement, in particular as set
forth in Section 2.1(g)) to the Company
hereunder and until the same is withdrawn
from consignment and paid for in full by the
Company as hereinafter provided, the Company
will pay to the Consignor a fee computed
daily on the value of such Consigned
Precious Metal as hereinafter set forth.
Consignment fees shall be accrued on a daily
basis and shall be paid as follows:
(i) in the case of Fixed Rate Consignments
having Consignment Periods of not more than
ninety (90) days, consignment fees shall be
paid on the last day of the Consignment
Period with respect thereto; and
(ii) in the case of Fixed Rate Consignments
having Consignment Periods in excess of
ninety (90) days, consignment fees shall be
paid quarterly and on the last day of the
Consignment Period with respect thereto, not
later than the fifth Business Day following
the receipt of billing.
Notwithstanding the foregoing, consignment fees may be payable more frequently
if agreed upon by the Consignor and the Company. (b) The Company shall pay a
Fixed Consignment Fee with respect to each consignment of Precious Metal under
the Consignment Facility, subject to the terms and conditions hereinafter set
forth. (c) Each Fixed Consignment Fee shall be calculated by the Consignor for a
certain specific quantity and form of Precious Metal consigned to the Company
for a certain specific Consignment Period. The quantity and form of Precious
Metal, and the Consignment Period shall be selected by the Company and consented
to by the Consignor. Once the specific quantity and form of Precious Metal and
the specific Consignment Period have been selected and consented to by the
Consignor and the consignment fee determined, such selections shall be
irrevocable and binding on the Company and shall obligate the Company to accept
the consignment requested the Consignor in the amount, in the form and for the
Consignment Period specified.
(d) At such time as the Company shall request
the consignment and delivery of Precious
Metal under the Consignment Facility, it
shall become obligated to pay to the
Consignor a market premium per ▇▇▇▇ ounce
announced by the Consignor at the time of
such consignment. Such payment is to be made
within five (5) Business Days of the
Company's receipt of the monthly invoice.
(e) At such time as the Company shall purchase
and withdraw Consigned Precious Metal from
consignment under the Consignment Facility,
it shall become obligated to (i) pay to the
Consignor (x) a purchase price computed in
accordance with Paragraph 2.2 hereof if such
purchase is effected by the Company (and the
Company has notified the Consignor) prior to
2:30 P.M., London Time, on any London
Banking Day, plus any applicable premium, or
(y) such other purchase price as shall be
mutually agreed upon by the Consignor and
the Company, or (ii) deliver Precious Metal
to the Consignor's unallocated accounts,
loco London, in the case of gold and silver,
and loco Zurich, in the case of platinum and
palladium, in an amount equal to the
Precious Metal purchased. All payments of
purchase price for Consigned Precious Metal
or deliveries of Precious Metal are to be
made within two (2) London Banking Days,
provided, however, title to such Consigned
Precious Metal shall not pass until the
payment of such purchase price. Consigned
Precious Metal shall be deemed to have been
purchased and withdrawn from consignment,
and payment of the purchase price shall
become due, at the earlier of (i) such time
as the Company shall notify the Consignor,
it elects to purchase such Consigned
Precious Metal, (ii) such time as the
Company sells such Consigned Precious Metal
in the ordinary course of its business,
(iii) the Company has not returned any
Consigned Precious Metal when due, or (iv)
the Company otherwise loses possession or
control over the Consigned Precious Metal
for reasons within the Company's reasonable
control, including but not limited to
knowingly or unknowingly passing on the
Consigned Precious Metal to a third party.
2.4. Requests for Consignments under the
Consignment Facility.
(a) The Company shall give to the Consignor
telephonic notice or notice sent by
telecopier from an Authorized Representative
of the Company (confirmed in writing by the
Consignor) of each request for a consignment
under the Consignment Facility. Each such
notice shall be irrevocable and binding on
the Company and shall obligate the Company
to accept the consignment requested from the
Consignor.
(b) Requests for any Fixed Rate Consignments
shall be furnished by an Authorized
Representative of the Company to the
Consignor by 12:00 noon (New York time) two
(2) London Banking Days prior to the
proposed Drawdown Date. Each such notice
shall specify (i) the amount and type of
Precious Metal requested, (ii) the proposed
Drawdown Date of such consignment, and (iii)
the Consignment Period for such consignment.
(c) Requests for, and repayments of, Fixed Rate
Consignments shall be for not less than:
(i) Four Thousand (4,000) fine ▇▇▇▇ ounces or
integral multiples of One Hundred (100) fine
▇▇▇▇ ounces in excess thereof, in the case
of gold;
(ii) Fifty Thousand (50,000) fine ▇▇▇▇ ounces or
integral multiples of Five Hundred (500)
fine ▇▇▇▇ ounces in
excess thereof, in the case of silver;
(iii) One Thousand (1,000) fine ▇▇▇▇ ounces or integral multiples of Fifty (50)
fine ▇▇▇▇ ounces in excess
thereof, in the case of platinum;
(iv) One Thousand (1,000) fine ▇▇▇▇ ounces or integral multiples of One Hundred
(100) fine ▇▇▇▇ ounces in excess
thereof, in the case of palladium.
2.5. Rollover Option.
Any Fixed Rate Consignments may be continued as such upon the
expiration of a Consignment Period with respect thereto by an Authorized
Representative of the Company giving to the Consignor telephonic notice
(confirmed in writing by the Consignor) of the Company's decision to continue an
outstanding consignment as such. In the event that the Company does not notify
the Consignor of its election hereunder with respect to any consignment by 12:00
noon (New York time) two (2) London Banking Days prior to the expiration of the
Consignment Period, such consignment shall be become due and payable on the last
day of the Consignment Period with respect thereto. 2.6. Inability to Determine
Fixed Consignment Fee.
In the event, prior to the commencement of any Consignment Period
relating to any Fixed Rate Consignment, the Consignor shall determine in good
faith that adequate and reasonable methods do not exist for ascertaining the
Fixed Consignment Fee that would otherwise determine the rate of interest to be
applicable to any Fixed Rate Consignment during any Consignment Period, the
Consignor shall forthwith give notice of such determination (which shall be
conclusive and binding on the Company) to the Company. In such event, (a) any
request for a Fixed Rate Consignment shall be automatically withdrawn, (b) each
Fixed Rate Consignment will automatically, on the last day of the then current
Consignment Period thereof, become due and payable, and (c) the obligations of
the Consignor to make Fixed Rate Consignments shall be suspended until the
Consignor determines that the circumstances giving rise to such suspension no
longer exist, whereupon the Consignor shall so notify the Company. 2.7.
Illegality.
Notwithstanding any other provisions herein, if any present or future
law, regulation, treaty or directive or in the reasonable interpretation or
application thereof shall make it unlawful for the Consignor to make or maintain
Fixed Rate Consignments, the Consignor shall forthwith give notice of such
circumstances to the Company and thereupon (a) the agreement of the Consignor to
make Fixed Rate Consignments shall forthwith be suspended, and (b) the Fixed
Rate Consignments then outstanding shall become due and payable on the last day
of each Consignment Period applicable to such Fixed Rate Consignments or within
such earlier period as may be required by law. The Company shall promptly pay
the Consignor any additional amounts necessary to compensate the Consignor for
any costs incurred by the Consignor in making any conversion in accordance with
this Paragraph, including any interest or fees payable by the Consignor to
lenders of funds obtained by it in order to make or maintain its Fixed Rate
Consignments hereunder.
2.8. Indemnity.
The Company shall indemnify the Consignor and hold the Consignor
harmless from and against any loss, cost or expense (including reasonable loss
of anticipated profits) that the Consignor may sustain or incur as a consequence
of (a) default by the Company in payment of any Fixed Rate Consignments as and
when due and payable (including, without limitation, as a result of prepayment
or late payment of the purchase price for the Consigned Precious Metal or the
acceleration of the Consignment Facility Indebtedness pursuant to the terms of
this Agreement), which expenses shall include any such loss or expense arising
from interest or fees payable by the Consignor to lenders of funds obtained by
it in order to maintain its Fixed Rate Consignments; (b) default by the Company
in taking a consignment or conversion after the Company has given (or is deemed
to have given) its request therefor; and (c) the purchase of Consigned Precious
Metal bearing a Fixed Consignment Fee on a day that is not the last day of the
applicable Consignment Period with respect thereto, including interest or fees
payable by the Consignor to lenders of funds obtained by it in order to maintain
any such consignments.
2.9. Use of Proceeds.
No portion of the proceeds of the Consignment Facility shall be used,
in whole or in part, for the purpose of purchasing or carrying any "margin
stock" as such term is defined in Regulation U of the Board of Governors of the
Federal Reserve System.
2.10. True Consignment; Grant of Security Interest
(a) The parties hereto intend that this Agreement shall provide for a true
consignment and that all transactions hereunder shall constitute true
consignments of the Precious Metal. (b) To secure the prompt and punctual
payment and performance of all indebtedness, obligations and liabilities of the
Company to the Consignor under this Consignment Facility, whether now existing
or hereafter incurred, the Company hereby grants to the Consignor a continuing
security interest in (i) the Consigned Precious Metal, whether now existing or
hereafter arising, (ii) all Inventory of the Company which contains Consigned
Precious Metal, whether now existing or hereafter arising, and (iii) all
proceeds and products of the foregoing to the extent that the Consignor has not
received payment with respect to the Consigned Precious Metal content thereof in
accordance with the terms hereof. Nothing contained in the foregoing grant is
intended to conflict with the true consignment nature of this Agreement. 2.11.
Maintenance of Consignment Limit If the Consignment Facility Indebtedness any
time exceeds the Consignment Limit, the Company will promptly, without further
notice or demand by the Consignor, either (a) make payment to the Consignor, as
provided in Paragraph 2.3(e) hereof, for Consigned Precious Metal having an
aggregate value sufficient to result in Consignment Facility Indebtedness being
not more than the Consignment Limit, or (b) deliver to the Consignor, either
physically at the Consignor's vault at ▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank, 60 Victoria
Embankment London C4YOBX or to the Consignor's unallocated accounts, loco
London, in the case of gold and silver, and loco Zurich, in the case of platinum
and palladium, sufficient Consigned Precious Metal to achieve the result
referred to in the preceding clause (a). Any physical return of Consigned
Precious Metal to the Consignor's vault in at ▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank, 60 Victoria
Embankment London C4YOBX shall be at the Company's expense and risk and shall
only be credited to the Company's account upon the Consignor's assaying the
value thereof.
2.12. Termination; Return of Precious Metal
(a) This Agreement is not a commitment of the Consignor to consign Precious
Metals or otherwise extend credit to the Company. The Consignor may terminate
this Consignment Facility by giving forty-five (45) days' prior written notice
of such termination to the Company. Upon giving of such notice, the Consignor
may, at its option, suspend or terminate the consignment or delivery of Precious
Metal hereunder. ALL SUMS OUTSTANDING UNDER THIS CONSIGNMENT FACILITY WILL BE
DUE AND PAYABLE UPON THE EARLIER OF (I) THE OCCURRENCE OF AN EVENT OF DEFAULT
AND ACCELERATION OF THE OBLIGATIONS BY THE CONSIGNOR, OR (II) FORTY-FIVE (45)
DAYS AFTER RECEIPT OF WRITTEN NOTICE FROM THE CONSIGNOR HEREUNDER. (b) The
Company may terminate this Consignment Facility by giving five (5) days' prior
written notice of such termination to the Consignor. Upon receipt of such
notice, the Consignor shall suspend and terminate to the consignment or delivery
Precious Metal hereunder. ALL SUMS OUTSTANDING UNDER THIS CONSIGNMENT FACILITY
WILL BE DUE AND PAYABLE FIVE (5) DAYS AFTER RECEIPT OF WRITTEN NOTICE FROM THE
COMPANY HEREUNDER. (c) Termination of this Consignment Facility shall not affect
the Company's duty to pay and perform its obligations to the Consignor hereunder
in full. Notwithstanding termination, until all Consignment Facility
Indebtedness has been fully satisfied, the Consignor shall retain all security
interests granted to it and, except for those specific covenants and conditions
dealing with the making of consignments, all terms and conditions of this
Agreement shall remain in full force and effect.
(d) Upon termination of this Agreement for any reason the Company shall within
twenty-four (24) hours following such effective date of termination (i) pay to
the Consignor (x) a purchase price computed in accordance with Paragraph 2.2
hereof, plus any applicable premium, or (y) such other purchase price as shall
be mutually agreed upon by the Consignor and the Company; (ii) deliver Precious
Metal to the Consignor's unallocated accounts, loco London, in the case of gold
and silver, and loco Zurich, in the case of platinum and palladium, in an amount
equal to the Consignment Facility Indebtedness; or (iii) deliver to the
Consignor at the Consignor's vault at ▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank, 60 Victoria
Embankment London EC4YOBX, any Precious Metal theretofore consigned to but not
purchased and paid for in full by the Company. Any physical return of Consigned
Precious Metal to the Consignor's vault at ▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇▇ Bank, 60 Victoria
Embankment London EC4YOBX shall be at the Company's expense and risk and shall
only be credited to the Company's account upon the Consignor's assaying the
value thereof. (e) Notwithstanding the provisions of Paragraph 2.12(d) hereof,
in the event that the Consignment Facility is terminated as a result of the
Consignor giving forty-five (45) days written notice of termination to the
Company as set forth in Paragraph 2.12(a) hereof, the Consignor, at its option
and in its sole discretion, may agree not to accelerate the Fixed Rate
Consignments and may permit the Consigned Precious Metal which is the subject of
such Fixed Rate Consignments to be paid on the last day of the Consignment
Period with respect thereto in accordance with their respective terms and with
the consignment fees with respect thereto to be payable in accordance with
Paragraph 2.3(a) hereof.
3. AUTHORIZED REPRESENTATIVES.
The Company shall deliver to the Consignor a certificate or letter
certifying to the Consignor the name(s) of all Authorized Representatives, in
the form attached hereto as Exhibit A. The Consignor may conclusively rely on
such certificate or letter until it shall receive a further certificate from the
Company in form acceptable to the Consignor canceling or amending the prior list
of Authorized Representatives. Any person identifying himself or herself as an
Authorized Representative of the Company shall have the right to effect
transactions under this Agreement. The Consignor shall have no responsibility or
obligation to ascertain whether the person is in fact the Authorized
Representative of the Company which he or she claims to be or is, in fact,
authorized to effect the transaction. At its option, the Consignor may verify
any telephonic or telegraphic request for transaction by calling an Authorized
Representative, and where more than one Authorized Representative is so
authorized, by calling an Authorized Representative or other individual other
than the caller or the individual initiating the transaction. The Company
authorizes the Consignor at its option to record electronically all telephonic
requests for transactions that the Consignor may receive from the Company or any
other person purporting to act on behalf of the Company.
4. CONDITIONS.
4.1. Conditions to the Consignor's Obligation to
Consign Precious Metal.
(a) As a precondition to the Consignor's
consigning Precious Metal (but with the
Consignor retaining full discretion as to
whether to consign Precious Metal from time
to time):
(i) The representations and warranties set forth
in Paragraph 6 hereof shall be true and
correct on and as of the date hereof and the
date each consignment is requested and is to
occur.
(ii) The Company shall have executed and delivered to the Consignor, or
shall have caused to be executed and delivered to the Consignor in form and
substance acceptable to the Consignor, upon the execution of this Agreement, all
agreements required by the Consignor for the purpose of securing payment and
performance of Company's obligations under this Agreement, together with any
other documents required by the terms hereof or thereof, including, without
limitation, the Security Agreement and the Collateral Assignment; and all
insurance required by the terms hereof and by the Security Agreement, all of
which shall at all times remain in full force and effect. (iii) The Consignor
shall have received the
favorable written opinion of counsel for the
Company, dated the date hereof, satisfactory
to the Consignor and its counsel in scope
and substance, stating, among other things,
that this Agreement and all agreements
delivered in connection herewith have been
duly authorized, executed and delivered by
the Company and constitute the valid,
binding and enforceable obligations of the
parties thereto; and such other supporting
documents and certificates as the Consignor
or its special counsel may reasonably
request.
(iv) There shall have been no material adverse
change in the Company's financial condition
or its financial or business prospects from
those represented in any financial statement
or other information submitted to the
Consignor or upon which the Consignor has
relied.
(v) The Company shall have supplied the
Consignor with a certificate from an
insurance company reasonably satisfactory to
the Consignor with respect to the assets of
the Company, and a true and complete copy of
all insurance policies satisfactory to the
Consignor in all respects and which shall
include FPM, as agent for the Consignor and
the Other Consignors, as an additional
insured and loss payee, as its interests may
appear.
(vi) All legal matters incident to the
transactions hereby contemplated shall be
satisfactory to counsel for the Consignor.
(vii) No Event of Default as specified in
Paragraph 8.1 hereof, nor any event which
upon notice or lapse of time or both would
constitute such an Event of Default, shall
have occurred and be continuing
4.2. Company's Confirmation.
The Company's request to the Consignor for the delivery of Precious
Metal under the Consignment Facility shall be deemed to be a representation and
warranty to the Consignor that the respective conditions specified in Paragraph
4.1 for such consignment have been satisfied.
5. SECURITY
The repayment of the Obligations shall be secured by, and entitled to
the benefits of, the Security Agreement and the Collateral Assignment.
6. REPRESENTATIONS AND WARRANTIES
As a material inducement to the Consignor to deliver Consigned Precious
Metal to the Company, the Company hereby represents and warrants to the
Consignor (which representations and warranties shall survive the execution of
this Agreement and the delivery of Consigned Precious Metal) that: 6.1.
Corporate Authority. The Company (i) is duly organized, validly existing and in
good standing under the laws of its state of incorporation, (ii) has the
requisite corporate power and authority to own its properties and to carry on
business as now being conducted, and holds all material permits, authorizations
and licenses, without material restrictions or limitations, which are necessary
for such ownership or business activity, and (iii) is qualified to do business
in every jurisdiction where such qualification is necessary, and has the
requisite corporate power to execute, deliver and perform this Agreement, the
Security Agreement, the Collateral Assignment, and any security document or
documents securing the obligations of the Company under this Agreement. The
Company has no reason to believe that any such material permits, authorizations
or licenses will be revoked, canceled, rescinded, modified or lost. 6.2. No
Conflict. The execution, delivery and performance by the Company of the terms
and provisions of this Agreement, the Security Agreement, the Collateral
Assignment, and any other such security document(s) have been duly authorized by
all requisite corporate action and will not violate any provision of law, any
order of any court or other agency of government, the articles of incorporation
or the by-laws of the Company or any indenture, agreement or other instrument to
which it is party, or by which it is bound, or be in conflict with, result in a
breach of, or constitute (with due notice or lapse of time or both) a default
under, or, except as may be provided by this Agreement, result in the creation
or imposition of any lien, charge or encumbrance of any nature whatsoever upon
any of the property or assets of the Company pursuant to, any such indenture,
agreement or other instrument.
6.3. Litigation. 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 knowledge of the Company threatened, against or affecting the Company which,
if adversely determined, would have a material adverse effect on the business,
operations, properties, assets or condition, financial or otherwise, of the
Company.
6.4. Other Agreements. The Company is not a party to any agreement or instrument
or subject to any charter or other corporate restriction adversely affecting its
business, properties or assets, operations or conditions, financial or
otherwise.
6.5. Default. The Company 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 which could have a materially
adverse effect upon the Company's business, operations, properties, assets, or
condition, financial or otherwise.
6.6. Financing Statements. No financing statement or agreement is on file in any
public office pertaining to or affecting the Consigned Precious Metal or any
Inventory of the Company, now owned or hereafter acquired containing Consigned
Precious Metal.
6.7. Representations. No statement of fact made by or on behalf of the Company
in this Agreement or in any certificate or schedule furnished to the Consignor
pursuant hereto, contains any untrue statement of a material fact or omits to
state any material fact necessary to make statements contained therein or herein
not misleading. There is no fact presently known to the Company which has not
been disclosed to the Consignor which materially affects adversely, nor as far
as the Company can reasonably foresee, will materially affect adversely the
property, business, operations or condition (financial or otherwise) of the
Company.
6.8. Binding Obligations. This Agreement, the Security Agreement, the Collateral
Assignment, all other agreements securing this Agreement have been duly executed
and delivered by the Company and constitute legal, valid and binding obligations
of the Company, enforceable in accordance with their respective terms, subject
to bankruptcy, insolvency, reorganization and other similar laws of general
application affecting the rights of creditors generally. 6.9. No Event of
Default. No Event of Default as defined in Paragraph 8.1 hereof, and no event
which, with the passage of time or the giving of notice, or both, would become
such an Event of Default, has occurred and is continuing.
6.10. Financial Statements. The Company has furnished the Financial Statements
to the Consignor. The Financial Statements have been prepared in accordance with
GAAP on a basis consistent with that of preceding periods and are complete and
correct in all material respects and fairly present the financial condition of
the Company as at said dates, and the results of its operations for the year or
other period ended on said dates. Since the date(s) of the above described
balance sheets, there has been no material adverse change in the financial
condition of the Company. 6.11. Credit Agreement. The Company reaffirms and
restates and incorporates herein by reference, as of the date hereof, all of the
representations and warranties made by Company in the Credit Agreement, except
to the extent altered by actions permitted pursuant to the terms thereof or
expressly contemplated pursuant to the terms hereof or to the extent the
Consignor has been advised in writing of any inaccuracy with respect to such
representations or warranties and has waived the same in writing. 6.12.
Solvency.
(a) The fair salable value of the assets of the Company exceeds as of the date
hereof and will, immediately following each consignment and delivery of
Consigned Precious Metal and after giving effect to the application of the
proceeds of the Consignment Facility, exceed the amount that will be required to
be paid on or in respect of its existing debts and other liabilities (including
contingent liabilities) as they mature. (b) The assets of the Company do not as
of the date hereof and will not, immediately following each consignment and
delivery of Consigned Precious Metal, and after giving effect to the application
of the proceeds thereof, constitute unreasonably small capital to carry out its
business as conducted or as proposed to be conducted. (c) The Company does not
intend to, or believe that it will, incur debts beyond its ability to pay such
debts as they mature, taking into account the timing of and amounts of cash to
be received by the Company and the timing of and amounts of cash to be payable
on or in respect of indebtedness of the Company.
7. AFFIRMATIVE AND NEGATIVE COVENANTS
The Company covenants and agrees that, from the date hereof and until
payment and performance in full of all Obligations, the Company shall:
7.1. Credit Agreement. Observe, maintain and perform all of the covenants and
agreements set forth in the Credit Agreement, all of which are fully
incorporated herein, are hereby fully restated, shall be fulfilled by the
Company and shall remain in full force and effect. Such terms will apply herein,
as the same may be amended/extended/renewed in the Credit Agreement, provided
that if the Company is no longer a party to the Credit Agreement while this
Agreement remains in effect, the terms in effect at the time that the Credit
Agreement terminated, or the Company ceased to be a party, shall continue to
apply for purposes of this Agreement.
7.2. Litigation. Give prompt written notice to the 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.
7.3. Financial Condition. Furnish to the Consignor promptly, from time to time,
such information regarding its operations, assets, business affairs and
financial condition, as the Consignor may reasonably request and promptly advise
the Consignor of any material adverse change in its condition, financial or
otherwise. 7.4. Audits. Permit agents or representatives of FPM, for the benefit
of the Consignor and the Other Consignors, to inspect, at reasonable hours, the
Consigned Precious Metal and the Company's books and records and to make
abstracts or reproductions of such books and records and permit FPM's audit
staff, for the benefit of the Consignor and the Other Consignors, to conduct not
less than one annual audit and field exam of the Consigned Precious Metal, all
such audits and exams to be at the sole cost and expense of the Company. 7.5.
Liens. Not create, incur, assume or suffer to exist any mortgage, pledge, lien,
charge or other encumbrance of any nature whatsoever on (a) any of the Consigned
Precious Metal or any of the Other Consignors' Precious Metal, or (b) any
products or property now or hereafter owned which does or will include Consigned
Precious Metal or any of the Other Consignors' Precious Metal. 7.6. Disposition
of Property. Not, without the Consignor's prior written consent, sell, lease,
transfer or otherwise dispose of the Consigned Precious Metal or the Other
Consignors' Precious Metal, except for: (a) sales of inventory and other assets
in the ordinary course of the Company's business; and (b) the consignment of the
Consigned Precious Metal and Other Consignors' Precious Metal to the Dentsply
Subsidiaries pursuant to the Subsidiary Consignment
Agreement, provided that the terms of the Subsidiary
Consignment Agreement must be acceptable to FPM in
all respects and in its sole discretion, and provided
further that the value (as determined in accordance
with Paragraph 2.2 hereof) of Precious Metal on
consignment at any time to Ceramco, Inc. shall not
exceed Two Million Dollars ($2,000,000) and the value
(as determined in accordance with Paragraph 2.2
hereof) of Precious Metal on consignment at any time
to Elephant Dental B.V. shall not exceed Five Million
Dollars ($5,000,000).
7.7. Corporate Status. Not change its name or place of incorporation unless it
has provided the Consignor with thirty (30) days' prior written notice thereof.
7.8. Consigned Precious Metal. Not grant any security interest or ownership
rights to any customer or creditor (including any credit institutions) of the
Company with respect to any of the Consigned Precious Metal or any of the Other
Consignors' Precious Metal while at the Company's Premises or at other Approved
Locations regardless of whether or not such customers have prepaid orders for
the Consigned Precious Metal or the Other Consignors' Precious Metal or any
products or property which does or will include the Consigned Precious Metal or
the Other Consignors' Precious Metal and regardless of whether such creditors
(including credit institutions) have prior or ongoing security arrangements with
the Company, in which case the Company shall ensure that neither the Consigned
Precious Metals nor any of the Other Consignors Precious Metal shall be subject
to such prior security arrangements. 7.9. Consignments. Not obtain Precious
Metal on consignment or credit from any supplier, lender, consignor or financial
institution other than the Consignor and the Other Consignors unless such
supplier, lender, consignor or financial institution shall first (a) have
entered into a Consignment Agreement with the Company in a form acceptable to
FPM; and (b) become a party to the Intercreditor and Collateral Sharing
Agreement with Consignor and the Other Consignors, which Intercreditor and
Collateral Sharing Agreement shall be satisfactory to FPM in all respects in its
sole discretion and which shall at all times remain in full force and effect.
7.10. Location of Precious Metal. At all times, all of the Consigned Precious
Metal and all of the Other Consignors' Precious Metal shall be located at an
Approved Location, or shall be in transit to, or from, an Approved Location.
7.11. Other Consignment Agreements. Not amend any provision of any of the Other
Consignment Agreements except in accordance with the provisions of the
Intercreditor and Collateral Sharing Agreement. 7.12. Financial Statements.
Unless otherwise explicitly waived by the Consignor in writing, furnish to the
Consignor: (a) within one hundred twenty (120) days after the end of each Fiscal
Year, an audited balance sheet as of the end of such Fiscal Year, and an audited
statement of earnings for the Fiscal Year, certified by certified public
accountants selected by the Company and acceptable to the Consignor; (b) within
sixty (60) days after the end of each calendar quarter, a balance sheet as of
the end of such period, and a statement of earnings for the Fiscal Year through
the end of such period, prepared either by the Company and certified by a
financial officer of the Company or prepared on not less than a compilation
basis by independent certified public accountants selected by the Company and
acceptable to the Consignor; (c) within thirty (30) days of the end of each
calendar month, a Metals Report; and (d) promptly, from time to time such other
information regarding its operations, assets, business, affairs and financial
condition, including without limitation, an accounts payable reports and agings
of the Company, as the Consignor may reasonably request.
7.13. Environmental Matters. With respect to environmental matters: (a) comply
strictly and in all respects with the requirements of all federal, state, and
local environmental laws; (b) immediately contain and remove any hazardous or
toxic material found on the Premises in violation of applicable law, which work
must be done in compliance with applicable laws and at the Company's expense;
and (c) indemnify, defend, and hold the Consignor harmless from and against any
claim, cost, damage (including, without limitation, consequential damages),
expense (including, without limitation, attorneys' fees and expenses), loss,
liability, or judgment now or hereafter arising as a result of any claim for
environmental cleanup costs, any resulting damage to the environment and any
other environmental claims against the Company, the Consignor, or the Premises.
The provisions of this subparagraph (c) shall continue in effect and shall
survive (among other events) any termination of this Agreement, foreclosure, a
deed in lieu of foreclosure transaction, payment and satisfaction of the
obligations evidenced hereby or incurred pursuant hereto, and release of any
collateral.
7.14. Insurance. Keep its insurable properties adequately insured at all times,
by financially sound and reputable insurers, to such extent and against such
risks, including fire and other risks insured against by extended coverage, and
maintain liability and such other insurance as is customarily maintained by
company engaged in similar businesses.
7.15. Notices Relating to Credit Agreement. Forward to the Consignor copies of
all amendments to the Credit Agreement and all notices of default issued in
connection with the Credit Agreement (or under any other loan or credit
agreement which replaces the Credit Agreement upon its termination) immediately
upon receipt thereof.
8. EVENTS OF DEFAULT AND ACCELERATION
8.1. Events of Default In each case of the occurrence of any one or more of the
following events (each of which is herein called an "Event of Default"): (a)
default in the payment or performance of any of the Company's Obligations or
agreements hereunder or under
the Other Consignment Agreements; or
(b) any representation or warranty made herein or in any
certificate, statement or agreement furnished in
connection with this Agreement shall prove to be
false or misleading in any material respect; or
(c) default in the payment or performance of any
obligation or indebtedness of the Company to the
Consignor or any affiliate of the Consignor, whether
now or hereafter existing and howsoever arising,
incurred or evidenced; or
(d) default in the payment or performance of any
obligation or indebtedness of the Company to the
Lenders or any affiliate of the Lenders under the
Credit Agreement, or under any other loan or credit
agreement which replaces the Credit Agreement upon
its termination, whether now or hereafter existing
and howsoever arising, incurred or evidenced; or
(e) default in the payment or performance of any
obligation or indebtedness of any of the Dentsply
Subsidiaries to the Company under the Subsidiary
Consignment Agreement or under any other consignment
agreement pursuant to which Precious Metal is
consigned to any of the Dentsply Subsidiaries,
whether now or hereafter existing and howsoever
arising, incurred or evidenced; or
(f) the Company or any of the Dentsply Subsidiaries shall (i) make a
general assignment for the benefit of creditors, or (ii) file or suffer the
filing of any voluntary or involuntary petition under any chapter of the
Bankruptcy Act by or against the Company or under the Insolvency Ordinance
(Insolvenzordnung) by or against Degussa Dental GmbH, or (iii) apply for or
permit the appointment of a receiver, trustee or custodian of any of its
property or business; or (iv) become insolvent to suffer the entry of an order
for relief under Title 11 of the United States Code; or (v) make an admission of
its general inability to pay its debts as they become due; or
(g) the occurrence of any material loss, theft or
destruction of or damage to any of the Consigned
Precious Metal or to any of the Other Consignors'
Precious Metal; or
(h) the occurrence of any attachment on any of the
Consigned Precious Metal or on any of the Other
Consignors' Precious Metal; or
(i) default with respect to any evidence of indebtedness
of the Company or any of the Dentsply Subsidiaries
(other than to the Consignor, the Other Consignors
and the Lenders), if the effect of such default is to
(x) accelerate the maturity of such indebtedness or
permit the holder thereof to cause such indebtedness
to become due prior to the stated maturity thereof,
and (y) cause a material adverse effect upon the
business operations, properties, assets, or
condition, financial or otherwise, of the Company or
any of the Dentsply Subsidiaries, or
(j) any indebtedness of Company or any Dentsply
Subsidiary (other than to the Consignor, the Other
Consignors and the Lenders) is not paid, when due and
payable, whether at the due date thereof or a date
fixed for prepayment or otherwise and such failure
has a material adverse effect upon the business,
operations, properties, assets, or condition,
financial or otherwise, of the Company or any of the
Dentsply Subsidiaries; or
(k) the occurrence of any event of default under (x) any
agreement now or at any time hereafter securing or
guaranteeing performance of this Agreement,
including, without limitation, the Security Agreement
and the Collateral Assignment, or (y) any agreement
now or at any time hereafter securing or guaranteeing
performance of any of the Other Consignment
Agreements; or
(l) any direct or indirect change in the majority
ownership or control of the Company or any of the
Dentsply Subsidiaries; or
(m) the occurrence of any material loss, theft or
destruction of or damage to any of the property of
the Company or any of the Dentsply Subsidiaries
which, in the Consignor's sole reasonable
determination, is not adequately insured;
then in any such event, at the Consignor's option, (A) the obligations of the
Consignor hereunder shall terminate, (B) the Company shall promptly return to
the Consignor all Precious Metal theretofore consigned to but not purchased and
paid for by the Company, and (C) all the Company's obligations to the Consignor
(including, without limitation, the Consignment Facility) shall become and be
immediately due and payable without presentment, demand or notice, all of which
are hereby expressly waived, notwithstanding any credit or time allowed to the
Company or any instrument evidencing any of the Company's obligations to the
Consignor. The Consignor shall in addition have all of the rights and remedies
of a secured party under the Uniform Commercial Code with respect to any
collateral now or hereafter securing the Company's obligations hereunder. The
Company shall, at the Consignor's request, immediately assemble all such
collateral and the Consigned Precious Metal, and the Consignor may go upon the
Premises to take immediate possession thereof. The Company shall pay all
reasonable legal expenses and attorneys' fees incurred by the Consignor in
enforcing the Consignor's rights, powers and remedies under this Agreement.
8.2. Waiver No failure or delay on the Consignor's part to exercise or to
enforce any of the Consignor's rights hereunder or under any other instruments
or agreement evidencing any of the Company's obligations to the Consignor or to
require strict compliance with the terms hereof or thereof in any one or more
instances and no course of conduct on the Consignor's part shall constitute or
be deemed to constitute a waiver or relinquishment of any such rights hereunder
unless it shall have signed a waiver thereof in writing and no such waiver,
unless expressly stated therein, shall be effective as to any transaction which
occurs after the date of such waiver or as to any continuance of a breach after
such waiver. The Consignor's rights hereunder shall continue unimpaired
notwithstanding any extension of time, compromise or other indulgence granted by
the Consignor to the Company with respect to any of the Company's obligations to
the Consignor or any instrument given the Consignor in connection therewith, and
the Company hereby waives notice of any such extension, compromise or other
indulgence and consents to be bound thereby as if it had expressly agreed
thereto in advance.
9. NO ASSIGNMENT
The rights of the Company under this Agreement may not be assigned to
any third party without the prior written consent of the Consignor. All
covenants and agreements of the Company contained herein shall bind the Company
and its successors and assigns, and shall inure to the benefit of the Consignor,
its successors and assigns.
10. EXPENSES
The Company shall pay on demand all expenses of the Consignor in
connection with the preparation, administration, default, collection, wavier or
amendment of consignment terms, or in connection with the Consignor's exercise,
preservation or enforcement of any of its rights, remedies or options hereunder
or under the Security Agreement or the Collateral Assignment, including, without
limitation, fees of outside legal counsel, including German counsel, or the
allocated costs of in-house legal counsel, accounting, consulting, brokerage or
other costs relating to any appraisals or examinations conducted in connection
with the Consignment or any collateral therefor, and the amount of all such
expenses shall, until paid, bear interest at the rate applicable to unpaid
purchase price hereunder (including any default rate) and be an obligation
secured by such collateral.
11. GOVERNING LAW; MISCELLANEOUS
11.1. Governing Law. This Agreement shall be governed by and shall be construed
under the laws of the State of New York (excluding the laws applicable to
conflicts or choice of law) unless otherwise specifically provided. 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.
11.2. JURISDICTION. THE COMPANY AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS
AGREEMENT OR ANY OF THE OTHER CONSIGNMENT DOCUMENTS MAY BE BROUGHT BY THE
CONSIGNOR IN ITS DISCRETION IN THE COURTS OF THE STATE OF NEW YORK OR ANY
FEDERAL COURT SITTING THEREIN OR IN THE COURTS OF MUNICH, GERMANY AND CONSENTS
TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURTS AND SERVICE OF PROCESS IN ANY
SUCH SUIT BEING MADE UPON COMPANY BY MAIL AT THE ADDRESS SET FORTH IN THIS
AGREEMENT, IT BEING UNDERSTOOD THAT THE COMPANY MAY ONLY BE ENTITLED TO BRING
SUIT IN THE COURTS OF THE STATE OF NEW YORK OR ANY FEDERAL COURT SITTING
THEREIN. THE COMPANY HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS
BROUGHT IN AN INCONVENIENT FORUM. THE COMPANY AND THE CONSIGNOR MUTUALLY HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN
RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT OR ANY OTHER CONSIGNMENT DOCUMENTS CONTEMPLATED TO BE EXECUTED IN
CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS
(WHETHER VERBAL OR WRITTEN ) OR ACTIONS OF ANY PART, INCLUDING, WITHOUT
LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF
THE CONSIGNOR RELATING TO THE ADMINISTRATION OF THE CONSIGNMENT FACILITY OR
ENFORCEMENT OF THE CONSIGNMENT DOCUMENTS, AND AGREE THAT NEITHER PARTY WILL SEEK
TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL
CANNOT BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, THE COMPANY
HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY
SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN,
OR IN ADDITION TO, ACTUAL DAMAGES. THE COMPANY CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF THE CONSIGNOR HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
THE CONSIGNOR WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR LENDER TO
ACCEPT THIS AGREEMENT AND EXTENDS THE CONSIGNMENT FACILITY.
11.3. Survival of Covenants. This Agreement and all covenants, agreements,
representations and warranties made herein and in the certificates delivered
pursuant hereto, shall survive the consigning of Precious Metal by the Consignor
to the Company, the execution and delivery to the Consignor of this Agreement,
and shall continue in full force and effect so long as any indebtedness or
obligation of the Company to the Consignor is outstanding and unpaid. Whenever
in this Agreement any of the parties hereto is referred to, such reference shall
be deemed to include the successors and assign of such party; and all covenants,
promises and agreements contained in this Agreement by or on behalf of the
Company shall inure to the benefit of the successors and assigns of the
Consignor. 11.4. Late Fee. If the entire amount of a required payment is not
paid in full within ten (10) business days after the same is due, the Company
shall pay to the Consignor a late fee equal to five percent (5%) of the required
payment.
11.5. Default Interest Rate. The Company hereby agrees to pay upon demand, to
the extent permitted by law, late charges on any sum or amount not paid when due
hereunder at a rate per annum equal to the Prime Rate plus four percent (4%),
from the date of delinquency until payment in full. Interest shall be calculated
on the basis of a 360-day year counting the actual number of days elapsed. Each
change in the Prime Rate charged being effective upon each date the Prime Rate
changes.
11.6. Increased Costs. If any present or future applicable law, which
expression, as used herein, includes statutes, rules and regulations thereunder
and interpretations thereof by any competent court or by any governmental or
other regulatory body or official charged with the administration or the
interpretation thereof and requests, directives, instructions and notices at any
time or from time to time hereafter made upon or otherwise issued to the
Consignor by any central bank or other fiscal, monetary or other authority
(whether or not having the force of law), shall:
(a) subject the Consignor to any tax (except for taxes on income or profits),
levy, impost, duty, charge, fee, deduction or withholding of any nature with
respect to the making of Fixed Rate Consignments, or
(b) materially change the basis of taxation (except for changes in taxes on
income or profits) of payments to the Consignor of the principal of or the
interest on Fixed Rate Consignments or any other amounts payable to the
Consignor under this Agreement for Fixed Rate Consignments, or
(c) impose or increase or render applicable (other than to the extent
specifically provided for elsewhere in this Agreement) any special deposit,
reserve, assessment, liquidity, capital adequacy or other similar requirements
(whether or not having the force of law) against assets held by, or deposits in
or for the account of, or loans by, or commitments of an officer of the
Consignor, or
(d) impose on the Consignor any other conditions or requirements with respect to
Fixed Rate Consignments or any class of loans or commitments of which any of
Fixed Rate Consignments form a part;
and the result of any of the foregoing is
(e) to increase the cost to the Consignor of making, funding, issuing, renewing,
extending or maintaining any of the Fixed Rate Consignments, or
(f) to reduce the amount of principal, interest or other amount payable to the
Consignor hereunder on account of any of the Fixed Rate Consignments, or
(g) to require the Consignor to make any payment or to forego any interest or
other sum payable hereunder, the amount of which payment or foregone interest or
other sum is calculated by reference to the gross amount of any sum receivable
or deemed received by the Consignor from the Company hereunder,
then, and in each such case, the Company will, upon demand by the Consignor, at
any time and from time to time and as often as the occasion therefor may arise,
pay to the Consignor such additional amounts as will be sufficient to compensate
the Consignor for such additional cost, reduction, payment or foregone interest
or other sum.
11.7. Capital Adequacy. If any present or future law, governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law) or the interpretation thereof by a court or governmental authority with
appropriate jurisdiction affects the amount of capital required or expected to
be maintained by the Consignor or any corporation controlling the Consignor and
the Consignor reasonably determines that the amount of capital required to be
maintained by it is increased by or based upon the existence of Fixed Rate
Consignments made or deemed to be made pursuant hereto, then the Consignor may
notify the Company of such fact, and the Company shall pay to the Consignor from
time to time upon demand, as an additional fee payable hereunder, such amount as
the Consignor shall determine and certify in a notice to the Company to be an
amount that will adequately compensate the Consignor in light of these
circumstances for its increased costs of maintaining such capital. The Consignor
shall allocate such cost increases among its customers in good faith and on
equitable basis.
11.8. Certificate of Increased Costs and Capital Adequacy. A certificate setting
forth any additional amounts payable pursuant to Paragraphs 11.6 and 11.7 and a
brief explanation of such amounts which are due, submitted by the Consignor to
the Company, shall be prima facie evidence that such amounts are due and owing.
11.9. Assignments. The Consignor shall have the unrestricted right at any time
or from time to time, with the Company's consent (such consent shall only be
required provided that no Event of Default has occurred and is then continuing),
which shall not be unreasonably withheld, to assign all or any portion of its
rights and obligations hereunder to one or more banks or other financial
institutions (each, an "Assignee"), and Company agrees that it shall execute, or
cause to be executed, such documents, including without limitations, amendments
to this Agreement and to any other documents, instruments and agreements
executed in connection herewith as the Consignor shall deem necessary to effect
the foregoing. In addition, at the request of the Consignor and any such
Assignee, Company shall enter into one or more new Consignment Agreements, as
applicable, with any such Assignee and, if the Consignor has retained any of its
rights and obligations hereunder following such assignment, to the Consignor,
which new Consignment Agreement shall be issued in replacement of, but not in
discharge of, the liability evidenced by the Consignment Agreement entered into
by the Consignor prior to such assignment and shall reflect the amount of the
respective commitments and consignment held by such Assignee and the Consignor
after giving effect to such assignment. Each interest assigned hereunder shall
be in an amount equal to at least Five Million Dollars ($5,000,000) of the total
commitment of the Consignor. Upon the execution and delivery of appropriate
assignment documentation, amendments and any other documentation required by the
Consignor in connection with such assignment, and the payment by Assignee of the
purchase price agreed to by the Consignor, and such Assignee, such Assignee
shall be a party to this Agreement and shall have all of the rights and
obligations of the Consignor hereunder (and under any and all other guaranties,
documents, instruments and agreements executed in connection herewith) to the
extent that such rights and obligations have been assigned by the Consignor
pursuant to the assignment documentation between the Consignor and such
Assignee, and the Consignor shall be released from its obligations hereunder and
thereunder to a corresponding extent. The Consignor may furnish any information
concerning the Company in its possession from time to time to prospective
Assignee, provided that the Consignor shall require any such prospective
Assignee to agree in writing to maintain the confidentiality of such
information.
11.10. Participations. The Consignor shall have the unrestricted right at any
time and from time to time, with the consent of Company (such consent shall only
be required provided that no Event of Default has occurred and is then
continuing), which shall not be unreasonably withheld, to grant to one or more
banks or other financial institutions (each, a "Participant") participating
interests in the Consignor's obligation to consign Precious Metal hereunder.
Each participating interest granted hereunder shall be in an amount equal to at
least Five Million Dollars ($5,000,000) of the total commitment of the
Consignor. In the event of any such grant by the Consignor of a participating
interest to a Participant, the Consignor shall remain responsible for the
performance of its obligations hereunder and Company shall continue to deal
solely and directly with the Consignor in connection with the Consignor's rights
and obligations hereunder. The Consignor may furnish any information concerning
the Company in its possession from time to time to prospective Participants,
provided that the Consignor shall require any such prospective Participant to
agree in writing to maintain the confidentiality of such information.
11.11. Maximum Interest. All agreements between the Company and the Consignor
are hereby expressly limited so that in no contingency or event whatsoever,
whether by reason of acceleration of maturity of the indebtedness evidenced
hereby or otherwise, shall the amount paid or agreed to be paid to the Consignor
for the use or the forbearance of the indebtedness evidenced hereby exceed the
maximum permissible under applicable law. As used herein, the term "applicable
law" shall mean the law in effect as of the date hereof; provided, however, that
in the event there is a change in the law which results in a higher permissible
rate of interest, then this Agreement shall be governed by such new law as of
its effective date. In this regard, it is expressly agreed that it is the intent
of the Company and the Consignor in the execution, delivery and acceptance of
this Agreement to contract in strict compliance with the laws of the State of
New York from time to time in effect. If, under or from any circumstances
whatsoever, fulfillment of any provision hereof or of any of the consignment
documents at the time of performance of such provision shall be due, shall
involve transcending the limit of such validity prescribed by applicable law,
then the obligation to be fulfilled shall automatically be reduced to the limits
of such validity, and if under or from circumstances whatsoever the Consignor
should ever receive as interest an amount which would exceed the highest lawful
rate, such amount which would be excessive interest shall be applied to the
reduction of the principal balance evidenced hereby and not to the payment of
interest. This provision shall control every other provision of all agreements
between the Company and the Consignor.
11.12. Payments.
(a) All payments (other than payments in the form of Precious Metal) shall be
made by the Company at the office of the Consignor herein set forth or such
other place as the Consignor may from time to time specify in writing in lawful
currency of the United States of America in immediately available funds, without
counterclaim or setoff and free and clear of, and without any deduction or
withholding for, any taxes or other payments. (b) All payments shall be applied
first to the payment of all fees, expenses and other amounts due to the
Consignor (excluding purchase price for Consigned Precious Metal and consignment
fees), then to accrued consignment fees and interest and the balance on account
of outstanding purchase prices for Consigned Precious Metal; provided, however,
that after the occurrence of an Event of Default, payments will be applied to
the obligations of the Company to the Consignor as the Consignor determines in
its sole discretion.
(c) If this Agreement or any payment hereunder becomes due on a day which is not
a Business Day, the due date of this Agreement or payment shall be extended to
the next succeeding Business Day, and such extension of time shall be included
in computing interest and fees in connection with such payment. 11.13. Loss of
Agreement. Upon receipt of an affidavit of an officer of the Consignor as to the
loss, theft, destruction or mutilation of any security document which is not of
public record, and, in the case of any such loss, theft, destruction or
mutilation, the Company will issue, in lieu thereof, a replacement security
document of like tenor.
11.14. Pledge to Federal Reserve. The Consignor may at any time pledge all or
any portion of its rights under the consignment documents to any of the twelve
(12) Federal Reserve Banks organized under Section 4 of the Federal Reserve Act,
12 U.S.C Section 341. No such pledge or enforcement thereof shall release the
Consignor from its obligations under any of the consignment documents. 11.15.
Notices. All notices and other communications hereunder shall be in writing,
except as otherwise provided in this Agreement; and shall be sent by any one of
the following: certified mail, return receipt requested; overnight courier;
confirmed telecopier; or by hand and shall addressed (i) if to the Company, to
it at the Company's Address, and (ii) if to the Consignor, to it at the
Consignor's Address. Notices shall be deemed effective three (3) days after
deposit in the mail, if sent by certified mail; the next Business Day, if sent
by overnight courier; upon confirmation, if sent by confirmed telecopier; and
upon delivery, if sent by hand. The address of any party hereto for such
demands, notices and other communications may be changed by giving notice in
writing at any time to the other party hereto.
11.16. Waivers in Writing. No modification or waiver of any provision of this
Agreement, nor consent to any departure by the Company therefrom, shall in any
event be effective unless the same shall be in writing, and then such waiver or
consent shall be effective only in the specific instance, and for the purpose,
for which given. No notice to, or demand on, the Company, in any case, shall
entitle the Company to any other or future notice or demand in the same, similar
or other circumstances.
11.17. Delay in Enforcement. Neither any failure or any delay on the part of the
Consignor in exercising any right, power or privilege hereunder or under any
other instrument given as 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 right, power or privilege. 11.18. Severability.
In the event any part of this Agreement is found to be unenforceable in any
jurisdiction, the remaining provisions of this Agreement shall be binding with
the same effect as though the unenforceable part were deleted; provided,
however, such provision shall continue to be enforceable in all other
jurisdictions; and provided, further, however, that if a court finds such
provision to be unenforceable, such court shall be entitled to modify such
provision in order to make the same enforceable.
11.19. Final Agreement. This Agreement is intended by the parties as the final,
complete and exclusive statement of the transactions evidenced by this
Agreement. All prior or contemporaneous promises, agreements sand
understandings, whether oral or written, are deemed to be superseded by this
Agreement, and no party is relying on any promise, agreement or understanding
not set forth in this Agreement. This Agreement may not be amended or modified
except by a written instrument describing such amendment or modification
executed by the Company and Consignor.
*The next page is a signature page*
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
WITNESS: DENTSPLY INTERNATIONAL INC.
____________________________________ By:_________________________________
Title:
ABN AMRO Bank N.V., Australian Branch
By:_________________________________
Title:
By:_________________________________
Title:
EXHIBIT INDEX
Exhibit A Authorized Representatives Letter
Exhibit B Change in Consignment Limit
Exhibit C Approved Locations
3
EXHIBIT A
(TO BE TYPED ON COMPANY'S LETTERHEAD)
, 2005
To: ______________________
Dear Sir or Madam:
In accordance with that certain Consignment Agreement dated the date
hereof (the "Consignment Agreement") by and between the undersigned and ABN AMRO
Bank N.V., Australian Branch (the "Consignor"), the undersigned hereby
designates the following persons as Authorized Representatives who are
authorized by and on behalf of the undersigned: (a) to transact consignment and
purchase and sale transactions with the Consignor under the Consignment
Facility; (b) to request that a consignment under the Consignment Facility be
continued as such; and (c) to generally to bind the undersigned in any and all
transactions by and between Consignor and the undersigned under the Consignment
Facility:
Name Title
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Treasury Analyst I
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Treasury Analyst II
▇▇▇▇▇ ▇. ▇▇▇▇▇ Treasury Analyst II
▇▇▇▇▇▇ ▇▇▇▇▇▇ European Treasury Manager
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Treasury and Risk Manager
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Treasurer
The Consignor is hereby authorized to rely on this authorization until Consignor
receives further written notice canceling or amending the foregoing. All
capitalized terms used herein without definition shall have the meanings
assigned by the Consignment Agreement.
Very truly yours, DENTSPLY
INTERNATIONAL INC.
By:_____________________________________
Title:
-2-
EXHIBIT B
______________, 200_
DENTSPLY INTERNATIONAL INC.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Upon your acceptance of the terms of this letter agreement as evidenced
by your execution and delivery to ABN AMRO BANK N.V., AUSTRALIAN BRANCH
("Consignor") on or before ______________, 200_, of a copy of this letter,
DENTSPLY INTERNATIONAL INC. (the "Company"), and the Consignor agree effective
_________________, 200_, to amend the definition of the Consignment Limit
contained in Paragraph 1.11 of that certain Consignment Agreement dated
____________________, 2005, as the same may have been heretofore amended (the
"Consignment Agreement"), by and between Consignor and the Company to read as
follows:
"1.11. "Consignment Limit" means:
(a) _____________ Dollars ($____________); or
(b) such limit as Consignor and the Company may agree
upon from time to time as evidenced by an amendment
in substantially the form of Exhibit B attached
hereto and made a part hereof or in such other form
as Consignor shall require; or
(c) such other limit as Consignor may approve in its sole
discretion."
Except as amended hereby, the Consignment Agreement and all agreements
securing or guaranteeing the Consignment Agreement shall remain in full force
and effect and are in all respect hereby ratified and affirmed.
Very truly yours,
ABN AMRO Bank N.V., Australian Branch
By:_______________________________
Title:
By:_______________________________
Title:
Accepted and agreed as of the
____ day of ___________, 200_.
DENTSPLY INTERNATIONAL INC.
By: ________________________________
Title:
cc: ▇▇▇▇▇ ▇▇▇▇, Senior Vice President
Fleet Precious Metal Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
P83109.1
- 6 -
-3-
P128774.1
EXHIBIT C
APPROVED LOCATIONS
Degussa Dental GmbH
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇
▇-▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
Elephant Dental
Verlengde ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
Ceramco, Inc. (f/k/a Degussa-Ney Dental)
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇
Coimpa Ltda.
▇▇. ▇▇▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇.▇▇▇, ▇▇▇▇▇-▇▇▇
▇▇▇▇▇▇-▇▇
Sankin Kogyo Ltd.
Nasu Factory 1382-11
Shimoishigami
Ohtawara City, Tochigi 324-0036
Degussa Dental Austria GmbH
▇▇▇▇▇▇▇▇▇ ▇▇▇▇-▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇
Ceramco Inc.
Six ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇
Elephant Dental GmbH
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇
▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇ am Main
Elephant Dental GmbH
▇▇▇▇▇▇▇▇▇ ▇▇
▇-▇▇▇▇▇ ▇▇▇▇▇▇▇
Elephant Dental GmbH
Philipp ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇
▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇