EXHIBIT 4.8
CONFORMED COPY
INDEMNITY, SUBROGATION AND CONTRIBUTION AGREEMENT dated as
of April 30, 1998, among JAFRA COSMETICS INTERNATIONAL, S.A. DE
C.V., a sociedad anonima de capital variable organized under the
laws of the United Mexican States ("JCISA"), each Subsidiary of
JCISA listed on Schedule I hereto (the "Guarantors") and CREDIT
SUISSE FIRST BOSTON, a bank organized under the laws of
Switzerland, acting through its New York branch, as collateral
agent (in such capacity, the "Collateral Agent") for the Secured
Parties (as defined in the Credit Agreement referred to below).
Reference is made to (a) the Credit Agreement dated as of April 30, 1998
(as amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among CDRJ Investments (Lux) S.A., a Luxembourg societe anonyme,
CDRJ Acquisition Corporation (to be renamed Jafra Cosmetics International,
Inc.), a Delaware corporation ("JCI"), JCISA (together with JCI, the
"Borrowers"), the lenders from time to time party thereto (the "Lenders"), the
Issuing Bank (as defined therein) and Credit Suisse First Boston, as
administrative agent for the Lenders (in such capacity, the "Administrative
Agent"), as swingline lender and as Collateral Agent, and (b) the JCISA
Subsidiary Guarantee Agreement dated as of April 30, 1998, among the Guarantors
and the Collateral Agent (the "JCISA Subsidiary Guarantee Agreement").
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 JCISA and the Issuing Bank has
agreed to issue Letters of Credit for the account of JCISA pursuant to, and upon
the terms and subject to the conditions specified in, the Credit Agreement. The
Guarantors have guaranteed such Loans and the other Obligations (as defined in
the Guarantee Agreement) of JCISA pursuant to the JCISA Subsidiary Guarantee
Agreement; certain Guarantors have granted Liens on and security interests in
certain of their assets to secure such guarantees. The obligations of the
Lenders to make Loans and of the Issuing Bank to issue Letters of Credit are
conditioned on, among other things, the execution and delivery by JCISA and the
Guarantors of an agreement in the form hereof.
Accordingly, JCISA, each Guarantor and the Collateral 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), JCISA agrees that (a) in the event a payment shall be
made by any Guarantor under the JCISA Subsidiary Guarantee Agreement, JCISA
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, JCISA 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 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 JCISA 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
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shall be subrogated to the rights of such Claiming Guarantor under Section 1 to
the extent of such payment.
SECTION 3. Subordination. Notwithstanding any provision of this Agreement
to the contrary, all rights of the Guarantors under Sections 1 and 2 and all
other rights of indemnity, contribution or subrogation under applicable law or
otherwise shall be fully subordinated to the indefeasible payment in full in
cash of the Obligations. No failure on the part of JCISA or any 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 survive and be in full force
and effect so long as any Obligation is outstanding and has not been paid in
full, and so long as the L/C Exposure has not been reduced to zero or any of the
Commitments under the Credit Agreement have not been terminated, and shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any Obligation is rescinded or must otherwise
be restored by any Secured Party or any Guarantor upon the bankruptcy or
reorganization of JCISA, any Guarantor or otherwise. Notwithstanding the
foregoing, at the time any Guarantor is released from its obligations under the
Guarantee Agreement in accordance with such Guarantee Agreement or the Credit
Agreement, such Guarantor will cease to have any rights or obligations under
this Agreement.
SECTION 5. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ITS PRINCIPLES OR RULES OF CONFLICTS OF LAWS TO THE EXTENT SUCH
PRINCIPLES OR RULES WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION.
SECTION 6. No Waiver; Amendment. (a) No failure on the part of the
Collateral Agent, JCISA 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 Collateral 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 Collateral Agent, JCISA 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 between JCISA,
the Guarantors and the Collateral Agent, with (if required by the Credit
Agreement) the prior written consent of the Required Lenders.
SECTION 7. Notices. All communications and notices hereunder shall be in
writing and given as provided in the JCISA Subsidiary Guarantee Agreement and
addressed as specified therein or with respect to JCISA as provided in the
Credit Agreement.
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 JCISA nor any Guarantor may assign or transfer any of its rights or
obligations hereunder without the prior written consent of the Collateral
Agent.
SECTION 9. Survival of Agreement; Severability. (a) All covenants and
agreements made by JCISA and each Guarantor herein shall survive the making by
the Lenders of the Loans and the issuance of the Letters of Credit by the
Issuing Bank.
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(b) 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, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 10. Counterparts. This Agreement may be executed by one or more
parties to this Agreement on any number of separate counterparts (including by
facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. 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 Collateral Agent.
SECTION 11. Rules of Interpretation. The rules of interpretation
specified in Section 1.02 of the Credit Agreement shall be applicable to this
Agreement.
SECTION 12. Additional Guarantors. Pursuant to Section 5.11 of the Credit
Agreement, certain Subsidiaries of JCISA are required to become parties to the
JCISA Subsidiary Guarantee Agreement and this Agreement. Upon execution and
delivery, after the date hereof, by the Collateral Agent and such Subsidiary of
an instrument in the form of Annex 1 hereto, such Subsidiary 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 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first appearing above.
JAFRA COSMETICS INTERNATIONAL, S.A.
DE C.V.,
By /s/ David A. Novak
------------------------------
Name: David A. Novak
Title: Vice President
REDAY, S.A. DE C.V.,
as a Guarantor,
By /s/ David A. Novak
------------------------------
Name: David A. Novak
Title: Vice President
DISTRIBUIDORA VENUS, S.A. DE C.V.,
as a Guarantor,
By /s/ David A. Novak
------------------------------
Name: David A. Novak
Title: Vice President
DIRSAMEX, S.A. DE C.V.,
as a Guarantor,
By /s/ David A. Novak
------------------------------
Name: David A. Novak
Title: Vice President
QUALIFAX, S.A. DE C.V.,
as a Guarantor,
By /s/ David A. Novak
------------------------------
Name: David A. Novak
Title: Vice President
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JAFRA COSMETICS, S. DE R.L. DE C.V.,
as a Guarantor,
By /s/ David A. Novak
------------------------------
Name: David A. Novak
Title: Vice President
CONSULTORIA JAFRA, S.A. DE C.V.,
as a Guarantor,
By /s/ David A. Novak
------------------------------
Name: David A. Novak
Title: Vice President
CREDIT SUISSE FIRST BOSTON,
as Collateral Agent,
by /s/ Laurie Sivaslian
-------------------------------
Name: Laurie Sivaslian
Title: Director
by /s/ David Kratovil
-------------------------------
Name: David Kratovil
Title: Director
SCHEDULE I
to the Indemnity, Subrogation
and Contribution Agreement
Guarantors
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Name
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Reday, S.A. de C.V.
Distribuidora Venus, S.A. de C.V.
Dirsamex, S.A. de C.V.
Qualifax, S.A. de C.V.
Jafra Cosmetics, S. de RL. de C.V.
Consultoria Jafra, S.A. de C.V.
Annex 1 to
the Indemnity, Subrogation and
Contribution Agreement
SUPPLEMENT NO. dated as of , to the Indemnity,
Subrogation and Contribution Agreement dated as of April 30, 1998
(as the same may be amended, supplemented or otherwise modified
from time to time, the "Indemnity, Subrogation and Contribution
Agreement"), among JAFRA COSMETICS INTERNATIONAL, S.A. DE C.V., a
sociedad anonima de capital variable organized under the laws of
the United Mexican States ("JCISA"), each Subsidiary of JCISA
listed on Schedule I thereto (the "Guarantors"), and CREDIT
SUISSE FIRST BOSTON, a bank organized under the laws of
Switzerland acting through its New York branch, as collateral
agent (the "Collateral Agent") for the Secured Parties (as
defined in the Credit Agreement referred to below).
A. Reference is made to (a) the Credit Agreement dated as of April 30,
1998 (as amended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), among CDRJ Investments (Lux) S.A., a Luxembourg societe
anonyme, CDRJ Acquisition Corporation ([to be] renamed Jafra Cosmetics
International, Inc.), a Delaware corporation ("JCI"), JCISA (together with JCI,
the "Borrowers"), the lenders from time to time party thereto (the "Lenders"),
the Issuing Bank (as defined therein) and Credit Suisse First Boston, as
administrative agent for the Lenders (in such capacity, the "Administrative
Agent"), as swingline lender and as Collateral Agent, and (b) the JCISA
Subsidiary Guarantee Agreement dated as of April 30, 1998, among the Guarantors
and the Collateral Agent (the "JCISA Subsidiary Guarantee Agreement").
B. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Indemnity, Subrogation and
Contribution Agreement and the Credit Agreement.
C. JCISA and the Guarantors have entered into the Indemnity, Subrogation
and Contribution Agreement in order to induce the Lenders to make Loans and the
Issuing Bank to issue Letters of Credit. Pursuant to Section 5.11 of the Credit
Agreement, certain Subsidiaries of JCISA are required to become parties to the
JCISA Subsidiary Guarantee Agreement and this Agreement. Section 12 of the
Indemnity, Subrogation and Contribution Agreement provides that additional
Subsidiaries of JCISA may become Guarantors under the Indemnity, Subrogation and
Contribution Agreement by execution and delivery of an instrument in the form of
this Supplement. The undersigned Subsidiary of JCISA (the "New Guarantor") is
executing this Supplement in accordance with the requirements of the Credit
Agreement to become a Guarantor under the Indemnity, Subrogation and
Contribution Agreement in order to induce the Lenders to make additional Loans
and the Issuing Bank to issue additional Letters of Credit and as consideration
for Loans previously made and Letters of Credit previously issued.
Accordingly, the Collateral Agent and the New Guarantor agree as follows:
SECTION 1. In accordance with Section 12 of the Indemnity, Subrogation and
Contribution Agreement, the New Guarantor by its signature below becomes a
Guarantor under the Indemnity, Subrogation and Contribution Agreement with the
same force and effect as if originally named therein as a Guarantor and the New
Guarantor hereby agrees to all the terms and provisions of the Indemnity,
Subrogation and Contribution Agreement applicable to it as a Guarantor
thereunder. Each reference to a "Guarantor" in the Indemnity, Subrogation and
Contribution Agreement shall be deemed to include the New Guarantor. The
Indemnity, Subrogation and Contribution Agreement is hereby incorporated herein
by reference.
SECTION 2. The New Guarantor represents and warrants to the Collateral
Agent and the other Secured Parties that this Supplement has been duly
authorized, executed and delivered by it and constitutes its legal, valid and
binding obligation, enforceable against it in accordance with its terms, except
as may be limited by applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium, or similar laws relating to or affecting creditors'
rights generally and by
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general equitable principles (regardless of whether enforcement is sought in a
proceeding in equity or at law).
SECTION 3. This Supplement may be executed by one or more parties to this
Supplement on any number of separate counterparts (including by facsimile
transmission), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. This Supplement shall become effective
when the Collateral Agent shall have received counterparts of this Supplement
that, when taken together, bear the signatures of the New Guarantor and the
Collateral Agent.
SECTION 4. Except as expressly supplemented hereby, the Indemnity,
Subrogation and Contribution Agreement shall remain in full force and effect.
SECTION 5. THIS SUPPLEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ITS
PRINCIPLES OR RULES OF CONFLICTS OF LAWS TO THE EXTENT SUCH PRINCIPLES OR RULES
WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.
SECTION 6. Any provision of this Supplement 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, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 7. All communications and notices hereunder shall be in writing
and given as provided in Section 7 of the Indemnity, Subrogation and
Contribution Agreement. All communications and notices hereunder to the New
Guarantor shall be given to it at the address set forth under its signature.
IN WITNESS WHEREOF, the New Guarantor and the Collateral Agent have duly
executed this Supplement to the Indemnity, Subrogation and Contribution
Agreement as of the day and year first above written.
[Name of New Guarantor],
by _______________________________
Name:
Title:
Address:
CREDIT SUISSE FIRST BOSTON, as Collateral
Agent,
by _______________________________
Name:
Title:
Address:
by _______________________________
Name:
Title:
Address:
SCHEDULE I
to Supplement No.___ to the Indemnity,
Subrogation and Contribution Agreement
Guarantors
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Name Address
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