Exhibit 10.19
INTERCREDITOR AGREEMENT
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THIS INTERCREDITOR AGREEMENT (this "Agreement") is entered into as of
October 16, 1997, by and among THE CHASE MANHATTAN BANK, a New York banking
corporation ("Chase"), SEAFLA, INC., an Ohio corporation ("Seafla; collectively
with Chase, the "Lenders"), and TECHNOLOGY FLAVORS & FRAGRANCES, INC., a
Delaware corporation (the "Borrower").
PRELIMINARY STATEMENTS
A. Borrower and Chase have entered into that certain Credit Agreement
dated as of the date hereof (the "Credit Agreement"), pursuant to which Chase
has agreed, subject to the terms and conditions set forth in the Credit
Agreement, to extend credit to Borrower from time to time (the "Senior Loans").
B. The Chase Loans are to be evidenced by various promissory notes (the
"Senior Notes"), secured, INTER ALIA, by a first lien and security interest in
all existing and after-acquired personal property of Borrower (the
"Collateral").
C. Seafla is the holder of a certain amended and restated note (the
"Seafla Note") dated as of December 6, 1995, issued to it by Borrower in the
principal amount of $888,019 Repayment of the Seafla Note is secured by a lien
and security interest in certain items of the Collateral described on Schedule A
hereto (the "Seafla Collateral").
D. One of the conditions precedent to the making by Chase of the Senior
Loans is the execution by the parties hereto of this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. Definitions.
When used herein, the following terms shall have the following meanings (such
meanings to be applicable equally both to the singular and plural terms
defined):
ACQUISITION INSTRUMENTS: The Asset Purchase Agreement dated December 6,
1995 between Borrower and Seafla, the Seafla Note and all other instruments and
documents executed and delivered by Seafla and/or Borrower relating thereto.
BUSINESS DAY: Any day other than a Saturday, Sunday or other day on which
banking institutions in New York, New York are authorized or required to remain
closed to the general public.
ENFORCEMENT ACTION: The taking by Chase of any foreclosure (whether
judicial or nonjudicial) or other similar action under the UCC or applicable law
seeking to realize upon the Collateral.
NOTE: Any of the Chase Notes or the Seafla Note.
OBLIGATIONS: Collectively, the Subordinated Debt and the Senior Debt.
PROCEEDING: Any insolvency, bankruptcy, receivership, custodianship,
liquidation, reorganization, assignment for the benefit of creditors, or any
other proceeding for the liquidation, dissolution or other winding up of
Borrower or of all or any portion of the property of Borrower.
SECOND LIEN ENFORCEMENT ACTION: The taking by Seafla of any foreclosure
(whether judicial or nonjudicial) or other similar action under the UCC or
applicable law seeking to realize upon the Seafla Collateral.
SENIOR DEBT: The obligations owed by Borrower to Chase pursuant to the
Senior Instruments.
SENIOR DEFAULT: A Default or Event of Default pursuant to any of the
Senior Instruments.
SENIOR DEFAULT NOTICE: A written notice from Chase to Seafla and
Borrower pursuant to which such Senior Lender notifies such persons of the
existence of one or more Senior Defaults.
SENIOR INSTRUMENTS: The Credit Agreement, the Senior Notes and all other
instruments and documents executed and delivered by Borrower and/or Chase in
connection with the consummation of the transactions contemplated by the Credit
Agreement, together with any other agreement or instrument now or hereafter
arising and executed by the Borrower in favor of Chase.
SENIOR WAIVER NOTICE: A written notice from Chase to Seafla that the
Senior Defaults described in a Senior Default Notice have been waived.
SENIOR SECURITY INTEREST: The lien of Chase in the Collateral.
SUBORDINATED DEBT: All indebtedness owed by Borrower to Seafla pursuant to
the Acquisition Instruments.
SUBORDINATED SECURITY INTERESTS: The second lien of Seafla in the Seafla
Collateral.
2. SUBORDINATION; INSOLVENCY; PRIORITY OF LIENS; DESCRIPTION OF
COLLATERAL.
(a) SUBORDINATION. The payment of any Subordinated Debt hereby
expressly is subordinated to the prior payment of the Senior Debt and the
Subordinated Security
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Interests hereby expressly are subordinated to the Senior Security
Interests to the fullest extent permitted by law.
(b) INSOLVENCY, ETC. In the event of any Proceeding:
(i) all Senior Debt first shall be paid in full in cash before
any payment or distribution shall be made in respect of the
Subordinated Debt;
(ii) any payment or distribution which, but for the terms
hereof, otherwise would be payable or deliverable in respect of the
Subordinated Debt, shall be paid or delivered directly to Chase until
all Senior Debt shall have been paid in full in cash, and Seafla
irrevocably authorizes, empowers and directs all receivers, trustees,
liquidators, custodians, conservators and others having authority in
the premises to effect all such payments and deliveries. Seafla also
irrevocably authorizes and empowers Chase to demand, xxx for, collect
and receive every such payment or distribution described herein; and
(iii) Seafla agrees to execute and deliver to Chase or its
representative all such further instruments confirming the
authorization referred to in clause (ii), and agrees to take all such
other actions as Chase reasonably may request in order to enable Chase
to enforce all claims upon or in respect of the Subordinated Debt. In
no event shall Chase be liable to Seafla for any failure to prove the
Subordinated Debt, to exercise any right with respect thereto, or to
collect any sums payable thereon.
(c) PRIORITY. Notwithstanding the date, manner, or order of
perfection or attachment of the security interests, mortgages and liens
granted by Borrower to Chase and to Seafla, and notwithstanding the usual
application of the priority provisions of the UCC or any other applicable
law or judicial decision, or whether either Lender holds possession of all
or any part of the Collateral, Chase shall have a first and prior security
interest in and lien on the Collateral and Seafla shall have a second and
subordinate security interest in the Seafla Collateral only. Seafla,
nevertheless, agrees to make such filings and recordings in the public
records to evidence the subordinations and priorities made herein as Chase
may reasonably request.
(d) TERMINATION, RESCISSION OR MODIFICATIONS. The subordinations,
agreements and priorities set forth in this Agreement shall remain in full
force and effect regardless of whether any party hereto in the future seeks
to rescind, amend, terminate or reform, by liquidation or otherwise, its
respective agreements with Borrower.
3. PROCEEDS OF COLLATERAL.
Seafla shall not be entitled to receive and retain any item of Collateral
or proceeds thereof, including the proceeds of insurance relating thereto, until
all of the Obligations of Borrower to Chase are paid in full in cash and
performed in full. Any item of Collateral or proceeds thereof which comes into
the possession of Seafla or its agent shall be held in trust by
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Seafla for Chase, promptly delivered in the form received by Seafla to Chase
(with any endorsement necessary to make Chase a holder or a pledgee) and shall
be applied by Chase to the Obligations of Borrower to Chase pursuant to the
Senior Instruments. In the event of the failure of Seafla to make any
endorsement as provided in the preceding sentence, Chase is hereby irrevocably
constituted and appointed attorney-in-fact for Seafla with full power to make
any such endorsement and with full power of substitution. The power of attorney
granted herein shall be deemed to be coupled with an interest. If the
Obligations of Borrower owing to Chase are paid in full in cash and performed in
full, Chase shall deliver (unless otherwise restricted by law and subject in all
events to the receipt of an indemnification of all liabilities arising from such
delivery) or surrender possession to Seafla, without recourse or warranty, any
Seafla Collateral or proceeds thereof then in possession of Chase.
4. PAYMENTS ON SUBORDINATED DEBT.
Until the Senior Debt is paid in full in cash, there shall be no payment
made or accepted with respect to the Subordinated Debt Payment which constitutes
a prepayment of the Subordinated Debt. As long as Borrower has not received a
Senior Default Notice, Borrower may pay, and as long as Seafla has not received
a Senior Default Notice, Seafla may demand or receive from Borrower, annual
interest and principal payments in accordance with the terms of the Seafla Note;
provided, however, that simultaneously with any such payment, Borrower shall
deliver to Chase a certificate from the Chief Financial Officer of Borrower
stating that no Senior Default exists as of the date of such payment or will be
created as a result of such payment. Any payment or distribution on the
Subordinated Debt in violation of this Section 4 shall be paid or delivered
directly to Chase until all Senior Debt shall have been paid in full in cash,
and until such payment or delivery to Chase, such payment or distribution shall
be held in trust for Chase.
5. LEGENDS.
Seafla, simultaneously with the execution and delivery of this Agreement,
shall cause the following legend to be placed on the upper portion of the first
page of the Seafla Note:
This instrument and the obligations evidenced hereby are subordinated, in
the manner and to the extent set forth in an Intercreditor Agreement (the
"Agreement") dated October 16, 1997 by the maker and payee of this Note and
The Chase Manhattan Bank, to certain indebtedness or other obligations
(including interest) of the maker of this Note owed to The Chase Manhattan
Bank. Each holder of this Note, by its acceptance hereof, (i) shall be
bound by the Agreement and (ii) acknowledges that if and to the extent that
any conflict exists between the terms of this instrument and the terms of
the Agreement, the terms of the Agreement shall govern and control.
Seafla shall deliver to Chase photocopies of the original Seafla Note marked in
the manner set forth above.
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6. ENFORCEMENT ACTIONS.
(a) NO SECOND LIEN ENFORCEMENT ACTION. Prior to the payment in full
in cash the Senior Debt and notwithstanding anything contained in the
applicable Acquisition Instruments to the contrary, Seafla shall not take
any Second Lien Enforcement Action without the prior written consent of
Chase.
(b) REMEDIES. In the event of the commencement of foreclosure,
liquidation or similar action by Chase with respect to the Collateral,
Seafla agrees to cooperate with Chase in the exercise of its remedies,
including, without limitation, rights of entry to premises upon which
personal property is located. If Chase shall be in possession of any
Seafla Collateral after Borrower has satisfied all of its Obligations owing
to Chase, Chase shall deliver (unless otherwise restricted by law and
subject in all events to the receipt of an indemnification of all
liabilities arising from such delivery) or surrender possession of the same
to Seafla, without recourse or warranty.
(c) SEAFLA. Until the Senior Debt is paid in full in cash, Seafla
shall not exercise any of the remedies with respect to the Subordinated
Debt which may be available to Seafla, either at law or in equity,
including but not limited to foreclosure (whether judicial or non-judicial)
or other similar action under the UCC or applicable law seeking to realize
upon the Seafla Collateral. Upon receipt of a Senior Default Notice,
unless and until Seafla shall have received a Senior Waiver Notice, there
shall be no payment made on the Subordinated Debt.
7. AMENDMENTS. So long as any Senior Debt remains unperformed or unpaid,
Seafla shall not agree to any amendment, modification or supplement to any of
the Acquisition Instruments without the prior written consent of Chase.
8. CONTINUED EFFECTIVENESS OF THIS AGREEMENT.
THE TERMS OF THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE LENDERS
ARISING HEREUNDER SHALL NOT BE AFFECTED, MODIFIED OR IMPAIRED IN ANY MANNER OR
TO ANY EXTENT BY: (A) ANY AMENDMENT, MODIFICATION OR TERMINATION OF OR
SUPPLEMENT TO ANY OF THE ACQUISITION INSTRUMENTS OR THE SENIOR INSTRUMENTS; (B)
THE VALIDITY OR ENFORCEABILITY OF ANY OF THE ACQUISITION INSTRUMENTS OR THE
SENIOR INSTRUMENTS; (C) THE RELEASE, SALE, EXCHANGE OR SURRENDER, IN WHOLE OR IN
PART, OF ANY ADDITIONAL COLLATERAL TO WHICH EITHER LENDER BECOMES ENTITLED BY
VIRTUE OF THE OWNERSHIP BY SUCH LENDER OF SUCH LENDER'S PORTION OF THE
COLLATERAL (THE "ADDITIONAL COLLATERAL"); (D) ANY EXERCISE OR NON-EXERCISE OF
ANY RIGHT, POWER OR REMEDY UNDER OR IN RESPECT OF ANY OF THE OBLIGATIONS, THE
ACQUISITION INSTRUMENTS OR THE SENIOR INSTRUMENTS OR ARISING AT LAW; OR (E) ANY
WAIVER, CONSENT, RELEASE, INDULGENCE, EXTENSION, RENEWAL, MODIFICATION, DELAY OR
OTHER ACTION, INACTION OR OMISSION IN RESPECT THEREOF OR IN RESPECT OF ANY SUCH
ADDITIONAL COLLATERAL, ALL WHETHER OR NOT EITHER OF THE LENDERS SHALL HAVE
CONSENTED THERETO.
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9. PROCEEDINGS; WAIVER OF MARSHALLING.
Seafla may not commence or join with any other creditor in commencing any
Proceeding with respect to Borrower, unless the Senior Debt has been paid in
full in cash and payment is not subject to avoidance or Chase shall have
consented in writing to such action. Seafla waives any rights which it
otherwise might have as against Chase to require a marshalling of the assets of
Borrower.
10. WAIVERS OF CHASE.
No waiver shall be deemed to be made by Chase of any of its rights
hereunder, unless the same shall be in writing signed on behalf of Chase, and
each waiver, if any, shall be a waiver only with respect to the specific
instance involved and shall in no way impair the rights of Chase in any other
respect at any other time.
11. MISCELLANEOUS.
(a) PURPOSE OF AGREEMENT. The provisions of this Agreement are
solely for the purpose of defining the relative rights of the Lenders, and
nothing herein shall impair as between Borrower and either Lender the
obligations of Borrower under the Senior Instruments or the Acquisition
Instruments, which are unconditional and absolute, to pay all amounts to
the Lenders as and when the same shall become due thereunder and nothing
herein shall prevent either Lender from exercising all rights and remedies
otherwise permitted by applicable law upon default under the Senior
Instruments or the Acquisition Instruments to which such Lender is a party,
subject, however, to the provisions of this Agreement.
(b) SUCCESSORS AND ASSIGNS. This Agreement, without further
reference, shall pass to and may be relied on and enforced by any
transferee or subsequent holder of any of the Obligations. In the event of
any proposed sale, assignment, disposition or other transfer of any of the
Obligations (subject, however, to the restrictions contained herein), the
transferor thereof, prior to the CONSUMMATION of any such transfer, and as
a condition precedent to the rights of any transferee to succeed to such
transferor's position, shall cause the transferee thereof to execute and
deliver to the other parties to this Agreement an agreement (substantially
identical to this Agreement or otherwise in form and substance satisfactory
to such parties) providing for the continued effectiveness of all of the
rights of such parties arising under this Agreement.
(c) CONFLICTS. In the event of any conflict between any term,
covenant or condition of this Agreement and any term, covenant or condition
of any of the Senior Instruments or the Acquisition Instruments, the
provisions of this Agreement shall govern and be controlling.
(d) NOTICES. Any notices required or permitted to be given hereunder
shall be validly given if set forth in writing and delivered by telecopy,
by hand or commercial messenger against receipt or mailed, either by
overnight express carrier or by certified
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mail, postage prepaid, return receipt requested, addressed to the parties
hereto at their respective addresses as set forth on the signature page of
this Agreement. Any notice hereunder shall be deemed given (i) on the day
on which it is delivered by telecopy, by hand or such commercial messenger
service, (ii) if sent by overnight express carrier, on the Business Day
immediately after the day sent or, (iii) if sent by mail, on the earlier of
actual receipt by the recipient or three Business Days after the day
deposited in the mails, postage prepaid. Any notice by telecopy shall be
followed by delivery on the next Business Day by overnight, express carrier
or by hand. Any party hereto may designate any other address to which any
notices shall be given by notice duly given hereunder; provided, however,
that any such notice of other address shall be deemed to have been given
hereunder only when actually received by the party to which addressed.
(e) AMENDMENT OF AGREEMENT; ENTIRE AGREEMENT; COUNTERPARTS. This
Agreement may be amended or modified by written instrument only, signed by
each of the parties hereto. No waiver of any term or provision of this
Agreement shall be effective unless it is in writing, makes specific
reference to this Agreement and is signed by the party against which such
waiver is sought to be enforced. This Agreement constitutes the entire
agreement among the parties hereto with respect to the subject matter
hereof as of the date hereof, and supersedes all prior agreements,
representations and understandings, if any, relating to such subject
matter. This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and assigns.
This Agreement may be signed in one or more counterparts which, when taken
together, shall constitute one and the same document.
(f) NO FIDUCIARY. The parties hereto agree that Chase is not and
shall not be deemed to be a fiduciary for or on behalf of Seafla.
(g) NO THIRD PARTY BENEFICIARIES. The terms and provisions of this
Agreement are for the benefit of only the parties hereto and their
respective successors and assigns. No other person shall have any right,
benefit, priority, or interest under or because of this Agreement.
(h) CONTESTING LIENS OR SECURITY INTERESTS. Seafla shall not contest
the validity, perfection, priority or enforceability of any lien or
security interest granted to Chase.
(i) JURY TRIAL WAIVER. EACH PARTY HERETO WAIVES THE RIGHT TO A JURY
TRIAL IN ANY DISPUTE ARISING UNDER OR WITH RESPECT TO THIS AGREEMENT.
(j) SEVERABILITY OF PROVISIONS. Any provision of this Agreement that
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.
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(k) CAPTIONS. The captions in this Agreement are for convenience of
reference only and shall neither define nor limit any of the terms or
provisions herein.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the date first above written.
THE CHASE MANHATTAN BANK
By:___________________________________
Title:________________________________
Address: 000 Xxxxx Xxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
Attn: Technology Flavors &
Fragrances Account Officer
Telecopy No.: (000) 000-0000
SEAFLA, INC.
By:_____________________________________
Title:__________________________________
Address:________________________________
________________________________
Attention:______________________
Telecopy No.:___________________________
WITH RESPECT TO ITS AGREEMENTS IN ARTICLE 4:
TECHNOLOGY FLAVORS & FRAGRANCES, INC.
By:___________________________________
Title:________________________________
Address:______________________________
_____________________________
_____________________________
Telecopy No.:_________________________
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