Exhibit 99.7
November 12, 2002
EXCHANGE AGENT AGREEMENT
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Ladies and Gentlemen:
Herbalife International, Inc., a Nevada corporation (the "Company"), proposes to
make an offer (the "Exchange Offer") to exchange all of its outstanding 11-3/4%
Series A Senior Subordinated Notes due 2010 (the "Series A Notes") for its
11-3/4% Series B Senior Subordinated Notes due 2010 (the "Series B Notes"). The
terms and conditions of the Exchange Offer as currently contemplated are set
forth in a prospectus, dated ___________ (the "Prospectus"), proposed to be
distributed to all record holders of the Series A Notes. The Series A Notes and
the Series B Notes are collectively referred to herein as the "Securities".
The Company hereby appoints The Bank of New York to act as exchange agent (the
"Exchange Agent") in connection with the Exchange Offer. References hereinafter
to "you" shall refer to The Bank of New York.
The Exchange Offer is expected to be commenced by the Company on or about
_____________. The Letter of Transmittal accompanying the Prospectus (or in the
case of book-entry securities, the Automated Tender Offer Program ("ATOP") of
the Book-Entry Transfer Facility (as defined below)) is to be used by the
holders of the Series A Notes to accept the Exchange Offer and contains
instructions with respect to the delivery of certificates for Series A Notes
tendered in connection therewith.
The Exchange Offer shall expire at 5:00 p.m., New York City time, on _________
or on such subsequent date or time to which the Company may extend the Exchange
Offer (the "Expiration Date"). Subject to the terms and conditions set forth in
the Prospectus, the Company expressly reserves the right to extend the Exchange
Offer from time to time and may extend the Exchange Offer by giving oral
(promptly confirmed in writing) or written notice to you before 9:00 a.m., New
York City time, on the business day following the previously scheduled
Expiration Date.
The Company expressly reserves the right to amend or terminate the Exchange
Offer, and not to accept for exchange any Series A Notes not theretofore
accepted for exchange, upon the occurrence of any of the conditions of the
Exchange Offer specified in the
Prospectus under the caption "The Exchange Offer - Certain Conditions of the
Exchange Offer."
In carrying out your duties as Exchange Agent, you are to act in accordance with
the following instructions:
1. You will perform such duties and only such duties as are
specifically set forth in the section of the Prospectus
captioned "The Exchange Offer" or as specifically set forth
herein; provided, however, that in no way will your general
duty to act in good faith be discharged by the foregoing.
2. You will establish a book-entry account with respect to the
Series A Notes at The Depository Trust Company (the
"Book-Entry Transfer Facility") for purposes of the Exchange
Offer within two business days after the date of the
Prospectus, and any financial institution that is a
participant in the Book-Entry Transfer Facility's systems may
make book-entry delivery of the Series A Notes by causing the
Book-Entry Transfer Facility to transfer such Series A Notes
into your account in accordance with the Book-Entry Transfer
Facility's procedure for such transfer.
3. You are to examine each of the Letters of Transmittal and
certificates for Series A Notes (or confirmation of book-entry
transfer into your account at the Book-Entry Transfer
Facility) and any other documents delivered or mailed to you
by or for holders of the Series A Notes to ascertain whether:
(i) the Letters of Transmittal and any such other documents
are duly executed and properly completed in accordance with
instructions set forth therein; and (ii) the Series A Notes
have otherwise been properly tendered. In each case where the
Letter of Transmittal or any other document has been
improperly completed or executed or any of the certificates
for Series A Notes are not in proper form for transfer or some
other irregularity in connection with the acceptance of the
Exchange Offer exists, you will endeavor to inform the
presenters of the need for fulfillment of all requirements and
to take any other action as may be reasonably necessary or
advisable to cause such irregularity to be corrected.
4. With the approval of the President, Senior Vice President,
Executive Vice President, or any Vice President of the Company
(such approval, if given orally, to be promptly confirmed in
writing) or any other party designated in writing, by such an
officer, you are authorized to waive any defects,
irregularities or conditions of surrender in connection with
any tender of Series A Notes pursuant to the Exchange Offer.
5. Tenders of Series A Notes may be made only as set forth in the
Letter of Transmittal and in the section of the Prospectus
captioned "The Exchange Offer - Procedures for Tendering
Series A Notes," and Series A Notes shall be considered
properly tendered to you only when tendered in accordance with
the procedures set forth therein.
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Notwithstanding the provisions of this Section 5, Series A
Notes which the President, Senior Vice President,
Executive Vice President, or any Vice President of the
Company shall approve as having been properly tendered shall
be considered to be properly tendered (such approval, if given
orally, shall be promptly confirmed in writing).
6. You shall advise the Company with respect to any Series A
Notes received subsequent to the Expiration Date and accept
its instructions with respect to disposition of such Series A
Notes.
7. You shall accept tenders:
(a) in cases where the Series A Notes are registered in
two or more names only if signed by all named
holders;
(b) in cases where the signing person (as indicated on
the Letter of Transmittal) is acting in a fiduciary
or a representative capacity only when proper
evidence of his or her authority so to act is
submitted; and
(c) from persons other than the registered holder of
Series A Notes, provided that customary transfer
requirements, including payment of any applicable
transfer taxes, are fulfilled.
You shall accept partial tenders of Series A Notes where so
indicated and as permitted in the Letter of Transmittal and
deliver certificates for Series A Notes to the registrar for
split-up and return any untendered Series A Notes to the
holder (or such other person as may be designated in the
Letter of Transmittal) as promptly as practicable after
expiration or termination of the Exchange Offer.
8. Upon satisfaction or waiver of all of the conditions to the
Exchange Offer, the Company will notify you (such notice, if
given orally, to be promptly confirmed in writing) of its
acceptance, promptly after the Expiration Date, of all Series
A Notes properly tendered and you, on behalf of the Company,
will exchange such Series A Notes for Series B Notes and cause
such Series A Notes to be cancelled. Delivery of Series B
Notes will be made on behalf of the Company by you at the rate
of $1,000 principal amount of Series B Notes for each $1,000
principal amount of the corresponding series of Series A Notes
tendered promptly after notice (such notice if given orally,
to be promptly confirmed in writing) of acceptance of said
Series A Notes by the Company; provided, however, that in all
cases, Series A Notes tendered pursuant to the Exchange Offer
will be exchanged only after timely receipt by you of
certificates for such Series A Notes (or confirmation of
book-entry transfer into your account at the Book-Entry
Transfer Facility), a properly completed and duly executed
Letter of Transmittal (or manually signed facsimile thereof)
with any required signature guarantees and
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any other required documents. You shall issue Series B Notes
only in denominations of $1,000 or any integral multiple
thereof.
9. Tenders pursuant to the Exchange Offer are irrevocable, except
that, subject to the terms and upon the conditions set forth
in the Prospectus and the Letter of Transmittal, Series A
Notes tendered pursuant to the Exchange Offer may be withdrawn
at any time prior to the Expiration Date.
10. The Company shall not be required to exchange any Series A
Notes tendered if any of the conditions set forth in the
Exchange Offer are not met. Notice of any decision by the
Company not to exchange any Series A Notes tendered shall be
given (if given orally, to be promptly confirmed in writing)
by the Company to you.
11. If, pursuant to the Exchange Offer, the Company does not
accept for exchange all or part of the Series A Notes tendered
because of an invalid tender, the occurrence of certain other
events set forth in the Prospectus under the caption "The
Exchange Offer -- Conditions of the Exchange Offer" or
otherwise, you shall as soon as practicable after the
expiration or termination of the Exchange Offer return those
certificates for unaccepted Series A Notes (or effect
appropriate book-entry transfer), together with any related
required documents and the Letters of Transmittal relating
thereto that are in your possession, to the persons who
deposited them.
12. All certificates for reissued Series A Notes, unaccepted
Series A Notes or for Series B Notes shall be forwarded by
first-class mail.
13. You are not authorized to pay or offer to pay any concessions,
commissions or solicitation fees to any broker, dealer, bank
or other persons or to engage or utilize any person to solicit
tenders.
14. As Exchange Agent hereunder you:
(a) shall not be liable for any action or omission to act
unless the same constitutes your own gross
negligence, willful misconduct or bad faith, and in
no event shall you be liable to a securityholder, the
Company or any third party for special, indirect or
consequential damages, or lost profits, arising in
connection with this Agreement.
(b) shall have no duties or obligations other than those
specifically set forth herein or as may be
subsequently agreed to in writing between you and the
Company;
(c) will be regarded as making no representations and
having no responsibilities as to the validity,
sufficiency, value or genuineness of any
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of the certificates or the Series A Notes represented
thereby deposited with you pursuant to the Exchange
Offer, and will not be required to and will make no
representation as to the validity, value or
genuineness of the Exchange Offer;
(d) shall not be obligated to take any legal action
hereunder which might in your judgment involve any
material expense or liability, unless you shall have
been furnished with indemnity satisfactory to you;
(e) may conclusively rely on and shall be protected in
acting in reliance upon any certificate, instrument,
opinion, notice, letter, telegram or other document
or security delivered to you and believed by you to
be genuine and to have been signed or presented by
the proper person or persons;
(f) may act upon any tender, statement, request,
document, agreement, certificate or other instrument
whatsoever not only as to its due execution and
validity and effectiveness of its provisions, but
also as to the truth and accuracy of any information
contained therein, which you shall in good faith
believe to be genuine or to have been signed or
presented by the proper person or persons;
(g) may conclusively rely on and shall be protected in
acting upon written or oral instructions from any
authorized senior officer of the Company;
(h) may consult with counsel of your selection with
respect to any questions relating to your duties and
responsibilities and the advice or opinion of such
counsel shall be full and complete authorization and
protection in respect of any action taken, suffered
or omitted to be taken by you hereunder in good faith
and in accordance with the advice or opinion of such
counsel; and
(i) shall not advise any person tendering Series A Notes
pursuant to the Exchange Offer as to the wisdom of
making such tender or as to the market value or
decline or appreciation in market value of any Series
A Notes.
15. You shall take such action as may from time to time be
requested by the Company (and such other action as you may
deem appropriate) to furnish copies of the Prospectus, Letter
of Transmittal and the Notice of Guaranteed Delivery (as
defined in the Prospectus) or such other forms as may be
approved from time to time by the Company, to all persons
requesting such documents and to accept and comply with
telephone requests for information relating to the Exchange
Offer, provided that such information shall relate only to the
procedures for accepting (or withdrawing from) the Exchange
Offer. The Company will furnish you with copies of such
documents on your request. All other requests for information
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relating to the Exchange Offer shall be directed to the
Company, Attention: ____________________.
16. You shall advise by facsimile transmission _____, the _____ of
the Company (at the facsimile number (310) 410-9600), and such
other person or persons as the Company may request, daily (and
more frequently during the week immediately preceding the
Expiration Date if requested) up to and including the
Expiration Date, as to the number of Series A Notes which have
been tendered pursuant to the Exchange Offer and the items
received by you pursuant to this Agreement, separately
reporting and giving cumulative totals as to items properly
received and items improperly received. In addition, you will
also inform, and cooperate in making available to, the Company
or any such other person or persons upon oral request made
from time to time prior to the Expiration Date of such other
information as they may reasonably request. Such cooperation
shall include, without limitation, the granting by you to the
Company and such person as the Company may request of access
to those persons on your staff who are responsible for
receiving tenders, in order to ensure that immediately prior
to the Expiration Date the Company shall have received
information in sufficient detail to enable it to decide
whether to extend the Exchange Offer. You shall prepare a
final list of all persons whose tenders were accepted, the
aggregate principal amount of Series A Notes tendered, the
aggregate principal amount of Series A Notes accepted and
deliver said list to the Company.
17. Letters of Transmittal and Notices of Guaranteed Delivery
shall be stamped by you as to the date and, after the
expiration of the Exchange Offer, the time, of receipt thereof
and shall be preserved by you for a period of time at least
equal to the period of time you preserve other records
pertaining to the transfer of securities. You shall dispose of
unused Letters of Transmittal and other surplus materials by
returning them to the Company.
18. For services rendered as Exchange Agent hereunder, you shall
be entitled to such compensation as set forth on Schedule I
attached hereto. The provisions of this section shall survive
the termination of this Agreement.
19. You hereby acknowledge receipt of the Prospectus and the
Letter of Transmittal. Any inconsistency between this
Agreement, on the one hand, and the Prospectus and the Letter
of Transmittal (as they may be amended from time to time), on
the other hand, shall be resolved in favor of the latter two
documents, except with respect to your duties, liabilities and
indemnification as Exchange Agent.
20. The Company covenants and agrees to fully indemnify and hold
you harmless against any and all loss, liability, cost or
expense, including reasonable attorneys' fees and expenses,
incurred without gross negligence, bad faith or willful
misconduct on your part, arising out of or in connection with
any act, omission, delay or refusal made by you in reliance
upon any signature, endorsement,
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assignment, certificate, order, request, notice, instruction
or other instrument or document believed by you to be valid,
genuine and sufficient and in accepting any tender or
effecting any transfer of Series A Notes believed by you in
good faith to be authorized, and in delaying or refusing in
good faith to accept any tenders or effect any transfer of
Series A Notes. In each case, the Company shall be notified by
you, by letter or facsimile transmission, of the written
assertion of a claim against you or of any other action
commenced against you, promptly after you shall have received
any such written assertion or shall have been served with a
summons in connection therewith. The Company shall be entitled
to participate at its own expense in the defense of any such
claim or other action and, if the Company so elects, the
Company shall assume the defense of any suit brought to
enforce any such claim. In the event that the Company shall
assume the defense of any such suit, the Company shall not be
liable for the fees and expenses of any additional counsel
thereafter retained by you, so long as the Company shall
retain counsel satisfactory to you to defend such suit, and so
long as you have not determined, in your reasonable judgment,
that a conflict of interest exists between you and the
Company. The provisions of this section shall survive the
termination of this Agreement.
21. You shall arrange to comply with all requirements under the
tax laws of the United States, including those relating to
missing Tax Identification Numbers, and shall file any
appropriate reports with the Internal Revenue Service.
22. You shall deliver or cause to be delivered, in a timely manner
to each governmental authority to which any transfer taxes are
payable in respect of the exchange of Series A Notes, the
Company's check in the amount of all transfer taxes so
payable; provided, however, that you shall reimburse the
Company for amounts refunded to you in respect of your payment
of any such transfer taxes, at such time as such refund is
received by you.
23. This Agreement and your appointment as Exchange Agent
hereunder shall be construed and enforced in accordance with
the laws of the State of New York applicable to agreements
made and to be performed entirely within such state, and
without regard to conflicts of law principles, and shall inure
to the benefit of, and the obligations created hereby shall be
binding upon, the successors and assigns of each of the
parties hereto.
24. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original and all of
which together shall constitute one and the same agreement.
25. In case any provision of this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any
way be affected or impaired thereby.
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26. This Agreement shall not be deemed or construed to be
modified, amended, rescinded, cancelled or waived, in whole or
in part, except by a written instrument signed by a duly
authorized representative of the party to be charged. This
Agreement may not be modified orally.
27. Unless otherwise provided herein, all notices, requests and
other communications to any party hereunder shall be in
writing (including facsimile or similar writing) and shall be
given to such party, addressed to it, at its address or
telecopy number set forth below:
If to the Company:
Herbalife International, Inc.
1800 Century Park East
Los Angeles, CA 90067
Facsimile: (310) 410-9600
Attention: Principal Financial Officer
with a copy to:
Chadbourne & Parke LLP
30 Rockefeller Plaza
New York, NY 10112
Facsimile: (212)541-5369
Attention: Bruce J. Rader
If to the Exchange Agent:
The Bank of New York
101 Barclay Street
Floor 21 West
New York, New York 10286
Facsimile: (212) 815-5915
Attention: Corporate Trust Trustee
Administration
28. Unless terminated earlier by the parties hereto, this
Agreement shall terminate 90 days following the Expiration
Date. Notwithstanding the foregoing, Sections 18 and 20 shall
survive the termination of this Agreement. Upon any
termination of this Agreement, you shall promptly deliver to
the Company any certificates for Securities, funds or property
then held by you as Exchange Agent under this Agreement.
29. This Agreement shall be binding and effective as of the date
hereof.
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Please acknowledge receipt of this Agreement and confirm the arrangements herein
provided by signing and returning the enclosed copy.
By:_______________________________
Name:
Title:
Accepted as of the date first above written:
THE BANK OF NEW YORK, as Exchange Agent
By:_____________________________________
Name:
Title:
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SCHEDULE I
COMPENSATION OF EXCHANGE AGENT:
$5,000 PLUS $500 PER EXTENSION OF OFFER PLUS
REASONABLE OUT-OF-POCKET EXPENSES, INCLUDING
WITHOUT LIMITATION, REASONABLE LEGAL FEES AND EXPENSES.