EXHIBIT NO. 10.4
INDEMNITY, SUBROGATION and
CONTRIBUTION AGREEMENT dated as of April 29, 2009 (this
“ Agreement ”), among SEAGATE TECHNOLOGY, an
exempted limited liability company organized under the laws of the
Cayman Islands (“ Intermediate Holdings ”),
SEAGATE TECHNOLOGY HDD HOLDINGS, an exempted limited liability
company organized under the laws of the Cayman Islands (the “
Borrower ”), each subsidiary of the Borrower listed on
Schedule I hereto (each such subsidiary individually, a
“ Subsidiary ” and, each such Subsidiary, the
Borrower and Intermediate Holdings, individually, a “
Guarantor ” and, collectively, the “
Guarantors ”) and JPMORGAN CHASE BANK, N.A., as
administrative agent (in such capacity, the “
Administrative Agent ”) for the Secured Parties (as
defined in the Credit Agreement referred to below).
Reference is made to (a) the
Second Amended and Restated Credit Agreement dated as of
April 3, 2009 (as amended, supplemented or otherwise modified
from time to time, the “ Credit Agreement ”),
among the Borrower, Intermediate Holdings, the lenders from time to
time party thereto (the “ Lenders ”) and the
Administrative Agent, and (b) the U.S. Guarantee Agreement
dated as of April 29, 2009 (as amended, supplemented or
otherwise modified from time to time, the “ U.S. Guarantee
Agreement ”), among the Guarantors (as defined therein)
and the Administrative Agent. Capitalized terms used herein and not
defined herein shall have the meanings assigned to such terms in
the Credit Agreement.
The Lenders have agreed to make
Loans to the Borrower, and the Issuing Banks have agreed to issue
Letters of Credit for the account of the Borrower, pursuant to, and
upon the terms and subject to the conditions specified in, the
Credit Agreement. The Guarantors have guaranteed the Obligations
pursuant to the U.S. Guarantee Agreement. Certain Guarantors have
granted Liens on and security interests in certain of their assets
to secure such guarantees pursuant to (a) the U.S. Pledge
Agreement and (b) the U.S. Security Agreement, and certain
other Guarantors have granted Liens on and security interests in
certain of their assets to secure such guarantees pursuant to
certain other Security Documents. The obligations of the Lenders to
make Loans and of the Issuing Banks to issue Letters of Credit are
conditioned on, among other things, the execution and delivery by
the Borrower and the Guarantors of an agreement in the form
hereof.
Accordingly, the Borrower, each
Guarantor and the Administrative Agent agree as follows:
SECTION 1. Indemnity and
Subrogation. In addition to all such rights of indemnity and
subrogation as the Guarantors may have under applicable law (but
subject to Section 3), the Borrower agrees that (a) in
the event a payment shall be made by any Guarantor under the U.S.
Guarantee Agreement, the Borrower shall indemnify such Guarantor
for the full amount of such payment and such Guarantor shall be
subrogated to the rights of the Person to whom such payment shall
have been made to the extent of such payment and (b) in the
event any assets of any Guarantor shall be sold pursuant to any
Security Document to satisfy a claim of any Secured Party, the
Borrower shall indemnify such Guarantor in an amount equal to the
greater of the book value or the fair market value of the assets so
sold.
SECTION 2. Contribution and
Subrogation. Each Guarantor (a “ Contributing
Guarantor ”) agrees (subject to Section 3) that, in
the event a payment shall be made by any other Guarantor under the
U.S. Guarantee Agreement or assets of any other Guarantor shall be
sold pursuant to any Security Document to satisfy a claim of any
Secured Party and such other Guarantor (the “ Claiming
Guarantor ”) shall not have been fully indemnified by the
Borrower as provided in Section 1, the Contributing Guarantor
shall indemnify the Claiming Guarantor in an amount equal to the
amount of such payment or the greater of the book value or the fair
market value of such assets, as the case may be, in each case
multiplied by a fraction of which the numerator shall be the net
worth of the Contributing Guarantor on the date hereof and the
denominator shall be the aggregate net worth of all the Guarantors
on the date hereof (or, in the case of any Guarantor becoming a
party hereto pursuant to Section 12, the date of the
Supplement hereto executed and delivered by such Guarantor). Any
Contributing Guarantor making any payment to a Claiming Guarantor
pursuant to this Section 2 shall be subrogated to the rights
of such Claiming Guarantor under Section 1 to the extent of
such payment.
Notwithstanding anything in this
Agreement or any other Loan Document to the contrary, no CFC
Subsidiary or Qualified CFC Holding Company shall be a Contributing
Guarantor with respect to payments by or sales of assets of any
Claiming Guarantor to satisfy any Obligations of a U.S. Loan
Party.
SECTION 3. Subordination.
Notwithstanding any provision of this Agreement to the contrary,
all rights of each of the Guarantors under Sections 1 and 2
and all other rights of each of the Guarantors in respect of
indemnity, contribution or subrogation from any other Loan Party
under applicable law or otherwise shall be fully subordinated to
the prior payment in full in cash of all the Loan Document
Obligations that are then due and payable whether at maturity, by
acceleration or otherwise. No failure on the part of the Borrower
or any other Guarantor to make the payments required by
Sections 1 and 2 (or any other payments required under
applicable law or otherwise) shall in any respect limit the
obligations and liabilities of any Guarantor with respect to its
obligations hereunder, and each Guarantor shall remain liable for
the full amount of the obligations of such Guarantor
hereunder.
SECTION 4. Termination. This
Agreement shall terminate when all the Loan Document Obligations
have been paid in full in cash, the Commitments have expired or
been terminated, the principal of and interest on each Loan and all
fees payable under the Loan Documents shall have been paid in full,
all Letters of Credit shall have expired or been terminated (or
otherwise provided for in a manner satisfactory to the applicable
Issuing Bank) and all LC Disbursements shall have been reimbursed.
In the event that a Guarantor ceases to be a Subsidiary (as such
term is used in the Credit Agreement) pursuant to a transaction
permitted under the Loan Documents or, such Guarantor shall be
released from its obligations under this Agreement without further
action. Upon release of a Guarantor from its obligations under this
Agreement pursuant to this Section 4, and at the sole expense
of such Guarantor, the Administrative Agent shall execute and
deliver to such Guarantor such documents as such Guarantor may
reasonably
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request to evidence such termination or release.
This Agreement shall continue to be effective or be reinstated, as
the case may be, if at any time payment, or any part thereof, of
any Obligations is rescinded or must otherwise be restored by any
Secured Party or any Guarantor upon the bankruptcy or
reorganization of the Borrower, any Guarantor or
otherwise.
SECTION 5. GOVERNING LAW.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE LAW OF THE STATE OF NEW YORK.
SECTION 6. No Waiver;
Amendment. (a) No failure on the part of the
Administrative Agent or any Guarantor to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy by the Administrative Agent or any
Guarantor preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. All remedies
hereunder are cumulative and are not exclusive of any other
remedies provided by law. None of the Administrative Agent and the
Guarantors shall be deemed to have waived any rights hereunder
unless such waiver shall be in writing and signed by such
parties.
(b) Neither this Agreement nor any
provision hereof may be waived, amended or modified except pursuant
to a written agreement entered into among the Borrower, the
Guarantors and the Administrative Agent, subject to any consent
required in accordance with Section 9.02 of the Credit
Agreement.
SECTION 7. Notices. All
communications and notices hereunder shall be in writing and given
as provided in Section 9.01 of the Credit Agreement. All
communications and notices hereunder to each Guarantor shall be
given to it as provided in the U.S. Guarantee Agreement, with a
copy to the Borrower.
SECTION 8. Binding Agreement;
Assignments. Whenever in this Agreement any of the parties
hereto is referred to, such reference shall be deemed to include
the successors and assigns of such party; and all covenants,
promises and agreements by or on behalf of the parties that are
contained in this Agreement shall bind and inure to the benefit of
their respective successors and assigns. Neither the Borrower nor
any Guarantor may assign or transfer any of its rights or
obligations hereunder (and any such attempted assignment or
transfer shall be void) without the consent required in accordance
with Section 9.02 of the Credit Agreement.
SECTION 9. Survival of Agreement;
Severability . (a) All covenants and agreements made by
the Borrower and each Guarantor herein and in the certificates or
other instruments prepared or delivered in connection with this
Agreement or the other Loan Documents shall be considered to have
been relied upon by the Administrative Agent, the other Secured
Parties and each Guarantor and shall survive the execution and
delivery of the Loan Documents and the making by the Lenders of the
Loans and the issuance of the Letters of Credit by the Issuing
Banks and regardless of any investigation made by the Secured
Parties or on their behalf and notwithstanding that any Secured
Party may have had notice or knowledge of any Default or incorrect
representation or
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warranty at the time any credit is extended
under the Credit Agreement, and shall continue in full force and
effect until all the Loan Document Obligations have been paid in
full in cash, the Commitments have expired or been terminated, the
principal of and interest on each Loan and all fees payable under
any Loan Document shall have been paid in full, all Letters of
Credit shall have expired or been terminated (or otherwise provided
for in a manner satisfactory to the applicable Issuing Bank) and
all LC Disbursements shall have been reimbursed.
(b) In the event any one or more of
the provisions contained in this Agreement or in any other Loan
Document should be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or
impaired thereby (it being understood that the invalidity of a
particular provision in a particular jurisdiction shall not in and
of itself affect the validity of such provision in any other
jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes
as close as possible to that of the invalid, illegal or
unenforceable provisions.
SECTION 10. Counterparts.
This Agreement may be executed in counterparts (and by different
parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall
constitute a single contract and shall become effective as provided
in Section 8. This Agreement shall be effective with respect
to any Guarantor when a counterpart bearing the signature of such
Guarantor shall have been delivered to the Administrative Agent.
Delivery of an executed signature page to this Agreement by
facsimile or Adobe .pdf transmission shall be as effective as
delivery of a manually signed counterpart of this
Agreement.
SECTION 11. Rules of
Interpretation. The rules of interpretation specified in
Section 1.03 of the Credit Agreement shall be applicable to
this Agreement.
SECTION 12. Additional
Guarantors. Pursuant to Section 5.12 of the Credit
Agreement and the Collateral and Guarantee Requirement, each
Subsidiary Loan Party that is formed or acquired after the Second
Restatement Effective Date, and that is required to execute the
U.S. Guarantee Agreement, is required to execute this Agreement.
Upon execution and delivery, after the date hereof, by the
Administrative Agent and such a Subsidiary Loan Party of an
instrument in the form of Annex 1 hereto, such Subsidiary Loan
Party shall become a Guarantor hereunder with the same force and
effect as if originally named as a Guarantor hereunder. The
execution and delivery of any instrument adding an additional
Guarantor as a party to this Agreement shall not require the
consent of any other Guarantor hereunder. The rights and
obligations of each Guarantor hereunder shall remain in full force
and effect notwithstanding the addition of any new Guarantor as a
party to this Agreement.
[Signature Pages Follow]
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