0001193125-11-173362.txt : 20120615 0001193125-11-173362.hdr.sgml : 20120615 20110624171544 ACCESSION NUMBER: 0001193125-11-173362 CONFORMED SUBMISSION TYPE: F-4 PUBLIC DOCUMENT COUNT: 82 FILED AS OF DATE: 20110624 DATE AS OF CHANGE: 20111021 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Engineering & Services UK Holdings Ltd CENTRAL INDEX KEY: 0001516635 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-82 FILM NUMBER: 11931380 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Fluid Power Technologies Investments Ltd CENTRAL INDEX KEY: 0001516636 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-80 FILM NUMBER: 11931378 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: H Heaton Ltd CENTRAL INDEX KEY: 0001516638 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-69 FILM NUMBER: 11931367 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Olympus (Ormskirk) Ltd CENTRAL INDEX KEY: 0001516639 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-59 FILM NUMBER: 11931357 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ruskin Air Management Ltd CENTRAL INDEX KEY: 0001516640 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-56 FILM NUMBER: 11931354 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Holdings Ltd CENTRAL INDEX KEY: 0001516641 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-77 FILM NUMBER: 11931375 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Selkirk IP L.L.C. CENTRAL INDEX KEY: 0001516642 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-42 FILM NUMBER: 11931340 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Schrader, LLC CENTRAL INDEX KEY: 0001516643 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-46 FILM NUMBER: 11931344 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Fleximak Ltd. CENTRAL INDEX KEY: 0001516644 IRS NUMBER: 000000000 STATE OF INCORPORATION: D8 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-81 FILM NUMBER: 11931379 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Engineering & Services Ltd. CENTRAL INDEX KEY: 0001516645 IRS NUMBER: 000000000 STATE OF INCORPORATION: D8 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-83 FILM NUMBER: 11931381 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Selkirk Canada Holdings, L.P. CENTRAL INDEX KEY: 0001516646 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-44 FILM NUMBER: 11931342 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Selkirk Americas, L.P. CENTRAL INDEX KEY: 0001516647 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-45 FILM NUMBER: 11931343 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Schrader International Holding Co. CENTRAL INDEX KEY: 0001516648 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-48 FILM NUMBER: 11931346 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Schrader-Bridgeport International, Inc. CENTRAL INDEX KEY: 0001516649 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-66 FILM NUMBER: 11931364 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Automotive Canada Ltd CENTRAL INDEX KEY: 0001516657 IRS NUMBER: 000000000 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-35 FILM NUMBER: 11931333 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Corp CENTRAL INDEX KEY: 0001516658 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-38 FILM NUMBER: 11931336 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Automotive Holding Co. CENTRAL INDEX KEY: 0001516659 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-33 FILM NUMBER: 11931331 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Selkirk Corp CENTRAL INDEX KEY: 0001516660 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-43 FILM NUMBER: 11931341 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Industries, Inc. CENTRAL INDEX KEY: 0001516663 IRS NUMBER: 000000000 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-25 FILM NUMBER: 11931323 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Building Products, Inc. CENTRAL INDEX KEY: 0001516664 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-32 FILM NUMBER: 11931330 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins U.S., L.P. CENTRAL INDEX KEY: 0001516666 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-14 FILM NUMBER: 11931312 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Waltham Real Estate Holding Co. CENTRAL INDEX KEY: 0001516667 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-08 FILM NUMBER: 11931306 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACD Tridon (Holdings) Ltd CENTRAL INDEX KEY: 0001516669 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-58 FILM NUMBER: 11931356 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Air Systems Components Investments China Ltd CENTRAL INDEX KEY: 0001516670 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-90 FILM NUMBER: 11931388 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Beta Naco Ltd CENTRAL INDEX KEY: 0001516685 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-111 FILM NUMBER: 11931410 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: British Industrial Valve Co Ltd CENTRAL INDEX KEY: 0001516687 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-110 FILM NUMBER: 11931409 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Auto Parts Holdings China Ltd CENTRAL INDEX KEY: 0001516688 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-95 FILM NUMBER: 11931394 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Overseas Co CENTRAL INDEX KEY: 0001516689 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-01 FILM NUMBER: 11931298 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Trico Products (Dunstable) Ltd CENTRAL INDEX KEY: 0001516690 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-11 FILM NUMBER: 11931309 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Treasury (Canadian Dollar) Co CENTRAL INDEX KEY: 0001516691 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-17 FILM NUMBER: 11931315 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Willer & Riley Ltd CENTRAL INDEX KEY: 0001516692 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-07 FILM NUMBER: 11931305 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Treasury (Dollar) Co CENTRAL INDEX KEY: 0001516694 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-16 FILM NUMBER: 11931314 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Sterling Co CENTRAL INDEX KEY: 0001516695 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-18 FILM NUMBER: 11931316 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins SC1 Ltd CENTRAL INDEX KEY: 0001516696 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-19 FILM NUMBER: 11931317 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FORMER COMPANY: FORMER CONFORMED NAME: Tomkins SCI Ltd DATE OF NAME CHANGE: 20110325 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Finance Ltd CENTRAL INDEX KEY: 0001516697 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-30 FILM NUMBER: 11931328 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Pension Services Ltd CENTRAL INDEX KEY: 0001516698 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-21 FILM NUMBER: 11931319 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Treasury (Euro) Co CENTRAL INDEX KEY: 0001516737 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-15 FILM NUMBER: 11931313 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Finance Luxembourg Ltd CENTRAL INDEX KEY: 0001516739 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-29 FILM NUMBER: 11931327 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Investments China Ltd CENTRAL INDEX KEY: 0001516740 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-24 FILM NUMBER: 11931322 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Ideal Clamps (Suzhou) Investments Ltd CENTRAL INDEX KEY: 0001516741 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-26 FILM NUMBER: 11931324 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Swindon Silicon Systems Ltd CENTRAL INDEX KEY: 0001516742 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-39 FILM NUMBER: 11931337 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Stackpole Investments Ltd CENTRAL INDEX KEY: 0001516743 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-40 FILM NUMBER: 11931338 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Engineering Ltd CENTRAL INDEX KEY: 0001516744 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-31 FILM NUMBER: 11931329 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Schrader Electronics Ltd CENTRAL INDEX KEY: 0001516745 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-51 FILM NUMBER: 11931349 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Shiitake Ltd CENTRAL INDEX KEY: 0001516746 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-41 FILM NUMBER: 11931339 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Funding Ltd CENTRAL INDEX KEY: 0001516747 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-28 FILM NUMBER: 11931326 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Investments Ltd CENTRAL INDEX KEY: 0001516748 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-05 FILM NUMBER: 11931302 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACD Tridon Inc. CENTRAL INDEX KEY: 0001516750 IRS NUMBER: 000000000 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-92 FILM NUMBER: 11931391 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Eastern Sheet Metal, Inc. CENTRAL INDEX KEY: 0001516751 IRS NUMBER: 000000000 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-100 FILM NUMBER: 11931399 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ideal Clamp Products, Inc. CENTRAL INDEX KEY: 0001516752 IRS NUMBER: 000000000 STATE OF INCORPORATION: TN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-65 FILM NUMBER: 11931363 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Glass Master Corp CENTRAL INDEX KEY: 0001516753 IRS NUMBER: 000000000 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-70 FILM NUMBER: 11931368 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Mectrol, Inc. CENTRAL INDEX KEY: 0001516754 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-74 FILM NUMBER: 11931372 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Hytec, Inc. CENTRAL INDEX KEY: 0001516755 IRS NUMBER: 000000000 STATE OF INCORPORATION: WA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-87 FILM NUMBER: 11931385 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FBN Transportation, Inc. CENTRAL INDEX KEY: 0001516756 IRS NUMBER: 000000000 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-96 FILM NUMBER: 11931395 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Hart & Cooley Trucking Co CENTRAL INDEX KEY: 0001516757 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-68 FILM NUMBER: 11931366 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates International Holdings, LLC CENTRAL INDEX KEY: 0001516758 IRS NUMBER: 000000000 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-76 FILM NUMBER: 11931374 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Aquatic Trucking Co. CENTRAL INDEX KEY: 0001516759 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-113 FILM NUMBER: 11931412 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: e Industries, Inc. CENTRAL INDEX KEY: 0001516760 IRS NUMBER: 000000000 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-101 FILM NUMBER: 11931400 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Conergics Corp CENTRAL INDEX KEY: 0001516761 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-106 FILM NUMBER: 11931405 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Dexter Chassis Group, Inc. CENTRAL INDEX KEY: 0001516762 IRS NUMBER: 000000000 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-102 FILM NUMBER: 11931401 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ruskin Service Co CENTRAL INDEX KEY: 0001516763 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-52 FILM NUMBER: 11931350 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Schrader Electronics, Inc. CENTRAL INDEX KEY: 0001516764 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-50 FILM NUMBER: 11931348 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: National Duct Systems, Inc. CENTRAL INDEX KEY: 0001516766 IRS NUMBER: 000000000 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-62 FILM NUMBER: 11931360 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NRG Industries, Inc. (Delaware Entity) CENTRAL INDEX KEY: 0001516767 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-61 FILM NUMBER: 11931359 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FORMER COMPANY: FORMER CONFORMED NAME: NRG Industries, Inc. DATE OF NAME CHANGE: 20110328 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Aplicadores Mexicanos, S.A. de C.V. CENTRAL INDEX KEY: 0001516768 IRS NUMBER: 000000000 STATE OF INCORPORATION: O5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-88 FILM NUMBER: 11931386 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ruskin Co CENTRAL INDEX KEY: 0001516769 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-55 FILM NUMBER: 11931353 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Koch Filter Corp CENTRAL INDEX KEY: 0001516770 IRS NUMBER: 000000000 STATE OF INCORPORATION: KY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-64 FILM NUMBER: 11931362 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ruskin de Mexico S.A. de C.V. CENTRAL INDEX KEY: 0001516771 IRS NUMBER: 000000000 STATE OF INCORPORATION: O5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-53 FILM NUMBER: 11931351 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Rooftop Systems, Inc. CENTRAL INDEX KEY: 0001516772 IRS NUMBER: 000000000 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-57 FILM NUMBER: 11931355 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMP Industrial Mexicana, S.A. de C.V. CENTRAL INDEX KEY: 0001516777 IRS NUMBER: 000000000 STATE OF INCORPORATION: O5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-89 FILM NUMBER: 11931387 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FORMER COMPANY: FORMER CONFORMED NAME: AMO Industrial Mexicana, S.A. de C.V. DATE OF NAME CHANGE: 20110328 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Dexter Axle Co CENTRAL INDEX KEY: 0001516778 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-104 FILM NUMBER: 11931403 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Dexter Axle Trucking Co CENTRAL INDEX KEY: 0001516779 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-103 FILM NUMBER: 11931402 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Dexter Axle Acquisition Corp. CENTRAL INDEX KEY: 0001516780 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-105 FILM NUMBER: 11931404 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Aquatic Co. CENTRAL INDEX KEY: 0001516781 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-114 FILM NUMBER: 11931413 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Buffalo Holding Co CENTRAL INDEX KEY: 0001516782 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-108 FILM NUMBER: 11931407 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Overseas Investments Ltd CENTRAL INDEX KEY: 0001516783 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-22 FILM NUMBER: 11931320 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ruskin Co Canada Inc. CENTRAL INDEX KEY: 0001516784 IRS NUMBER: 000000000 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-54 FILM NUMBER: 11931352 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Carriage House Fruit Co CENTRAL INDEX KEY: 0001516786 IRS NUMBER: 000000000 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-107 FILM NUMBER: 11931406 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Broadway Mississippi Development, LLC CENTRAL INDEX KEY: 0001516787 IRS NUMBER: 000000000 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-109 FILM NUMBER: 11931408 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Development Corp CENTRAL INDEX KEY: 0001516788 IRS NUMBER: 000000000 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-93 FILM NUMBER: 11931392 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Poly Belt Mexicana, S.A. de C.V. CENTRAL INDEX KEY: 0001516789 IRS NUMBER: 000000000 STATE OF INCORPORATION: O5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-20 FILM NUMBER: 11931318 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Montisk Investments Netherlands C.V. CENTRAL INDEX KEY: 0001516790 IRS NUMBER: 000000000 STATE OF INCORPORATION: P7 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-63 FILM NUMBER: 11931361 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Overseas Holdings S.a.r.l. CENTRAL INDEX KEY: 0001516791 IRS NUMBER: 000000000 STATE OF INCORPORATION: N4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-23 FILM NUMBER: 11931321 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Automotive Company, S.a.r.l. CENTRAL INDEX KEY: 0001516792 IRS NUMBER: 000000000 STATE OF INCORPORATION: N4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-34 FILM NUMBER: 11931332 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Holdings Luxembourg, S.a.r.l. CENTRAL INDEX KEY: 0001516793 IRS NUMBER: 000000000 STATE OF INCORPORATION: N4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-27 FILM NUMBER: 11931325 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Investments Co S.a.r.l. CENTRAL INDEX KEY: 0001516794 IRS NUMBER: 000000000 STATE OF INCORPORATION: N4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-06 FILM NUMBER: 11931303 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins American Investmetns S.a.r.l. CENTRAL INDEX KEY: 0001516795 IRS NUMBER: 000000000 STATE OF INCORPORATION: N4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-36 FILM NUMBER: 11931334 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Luxembourg S.a.r.l. CENTRAL INDEX KEY: 0001516796 IRS NUMBER: 000000000 STATE OF INCORPORATION: N4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-03 FILM NUMBER: 11931300 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Schrader Investments Luxembourg S.a.r.l. CENTRAL INDEX KEY: 0001516797 IRS NUMBER: 000000000 STATE OF INCORPORATION: N4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-47 FILM NUMBER: 11931345 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Air System Components, Inc. CENTRAL INDEX KEY: 0001516798 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-91 FILM NUMBER: 11931389 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NRG Industries, Inc. (Texas Entity) CENTRAL INDEX KEY: 0001516898 IRS NUMBER: 000000000 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-60 FILM NUMBER: 11931358 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins, Inc. CENTRAL INDEX KEY: 0001518348 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-13 FILM NUMBER: 11931311 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins, LLC CENTRAL INDEX KEY: 0001518349 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-12 FILM NUMBER: 11931310 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Ltd CENTRAL INDEX KEY: 0001518350 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-04 FILM NUMBER: 11931301 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Acquisitions Ltd CENTRAL INDEX KEY: 0001518351 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-37 FILM NUMBER: 11931335 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EPICOR Industries, Inc. CENTRAL INDEX KEY: 0001518530 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-97 FILM NUMBER: 11931396 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Hart & Cooley, Inc. CENTRAL INDEX KEY: 0001518533 IRS NUMBER: 000000000 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-67 FILM NUMBER: 11931365 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Powertrain UK Ltd CENTRAL INDEX KEY: 0001518534 IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-71 FILM NUMBER: 11931369 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: 303-744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Holding GmbH CENTRAL INDEX KEY: 0001520492 IRS NUMBER: 000000000 STATE OF INCORPORATION: 2M FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-78 FILM NUMBER: 11931376 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Eifeler Maschinenbau GmbH CENTRAL INDEX KEY: 0001520493 IRS NUMBER: 000000000 STATE OF INCORPORATION: 2M FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-98 FILM NUMBER: 11931397 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates CIS LLC CENTRAL INDEX KEY: 0001520622 IRS NUMBER: 000000000 STATE OF INCORPORATION: 1Z FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-94 FILM NUMBER: 11931393 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Mectrol GmbH CENTRAL INDEX KEY: 0001520623 IRS NUMBER: 000000000 STATE OF INCORPORATION: 2M FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-75 FILM NUMBER: 11931373 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Power Transmission Europe BVBA CENTRAL INDEX KEY: 0001520624 IRS NUMBER: 000000000 STATE OF INCORPORATION: C9 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-73 FILM NUMBER: 11931371 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Auto Industrial de Partes, S.A. de C.V. CENTRAL INDEX KEY: 0001520904 IRS NUMBER: 000000000 STATE OF INCORPORATION: O5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-112 FILM NUMBER: 11931411 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tridon Clamp Products GmbH CENTRAL INDEX KEY: 0001520905 IRS NUMBER: 000000000 STATE OF INCORPORATION: 2M FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-10 FILM NUMBER: 11931308 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Tomkins Mauritius Co Ltd CENTRAL INDEX KEY: 0001520950 IRS NUMBER: 000000000 STATE OF INCORPORATION: O4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-02 FILM NUMBER: 11931299 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Trion (Deutschland) GmbH CENTRAL INDEX KEY: 0001520951 IRS NUMBER: 000000000 STATE OF INCORPORATION: 2M FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-09 FILM NUMBER: 11931307 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Schrader International Brasil Ltda. CENTRAL INDEX KEY: 0001523649 IRS NUMBER: 000000000 STATE OF INCORPORATION: D5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-49 FILM NUMBER: 11931347 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Engineering & Services Hamriyah FZE CENTRAL INDEX KEY: 0001523746 IRS NUMBER: 000000000 STATE OF INCORPORATION: C0 FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-84 FILM NUMBER: 11931382 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Powertrain Plastik Metal ve Makina Sanayii veTicaret Ltd Sirketi CENTRAL INDEX KEY: 0001523747 IRS NUMBER: 000000000 STATE OF INCORPORATION: W8 FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-72 FILM NUMBER: 11931370 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Guc Aktarim Sistemleri Dagitim Sanayi Ve Ticaret Ltd Sirketi CENTRAL INDEX KEY: 0001523748 IRS NUMBER: 000000000 STATE OF INCORPORATION: W8 FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-79 FILM NUMBER: 11931377 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Pinafore Holdings B.V. CENTRAL INDEX KEY: 0001523749 STANDARD INDUSTRIAL CLASSIFICATION: MOTOR VEHICLE PARTS & ACCESSORIES [3714] IRS NUMBER: 000000000 STATE OF INCORPORATION: P7 FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137 FILM NUMBER: 11931304 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Engineering & Services Australia Pty Ltd CENTRAL INDEX KEY: 0001523754 IRS NUMBER: 000000000 STATE OF INCORPORATION: C3 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-86 FILM NUMBER: 11931384 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Gates Engineering & Services FZCO CENTRAL INDEX KEY: 0001523839 IRS NUMBER: 000000000 STATE OF INCORPORATION: C0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-175137-85 FILM NUMBER: 11931383 BUSINESS ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 BUSINESS PHONE: (303) 744-5059 MAIL ADDRESS: STREET 1: C/O TOMKINS STREET 2: 1551 WEWATTA STREET CITY: DENVER STATE: CO ZIP: 80202 F-4 1 df4.htm FORM F-4 Form F-4
Table of Contents

As filed with the Securities and Exchange Commission on June 24, 2011

Registration No. 333-

 

 

FORM F-4

 

 

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

REGISTRATION STATEMENT

UNDER THE SECURITIES ACT OF 1933

 

 

Pinafore Holdings B.V.

(Exact name of registrant as specified in its charter)

 

 

 

The Netherlands   3714

(State or other jurisdiction

of incorporation)

  

(Primary Standard Industrial

Classification Code Number)

FOR ADDITIONAL REGISTRANTS, SEE “TABLE OF ADDITIONAL REGISTRANTS”

ON THE FOLLOWING PAGE

 

 

Fred. Roeskestraat 123

1076 EE

Amsterdam

The Netherlands

Tel: +31.20577.1177

(Address, including zip code, and telephone number, including area code, of registrants’ principal executive offices)

 

 

Thomas C. Reeve

Tomkins Limited

1551 Wewatta Street

Denver, Colorado 80202

Tel: +1. 303.744.5059

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

With a copy to:

Patrick H. Shannon

Rachel W. Sheridan

Latham & Watkins LLP

555 Eleventh St. NW

Suite 1000

Washington, DC 20004

Tel: +1.202.637.2200

 

 

Approximate date of commencement of proposed exchange offer: As soon as practicable after this Registration Statement is declared effective.

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the “Securities Act”), check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer).  ¨

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer).  ¨

 

 

Calculation of Registration Fee

 

 

Title of Each Class of

Securities to be Registered

  

Amount
to be

Registered

  

Proposed

Maximum

Offering Price
Per Note

  

Proposed

Maximum
Aggregate

Offering Price(1)

   Amount of
Registration Fee

9% Senior Secured Second Lien Notes

   $1,150,000,000   100%   $1,150,000,000   $133,515.00 (2)

Guarantees of 9% Senior Secured Second Lien Notes (3)

   N/A(4)   (4)   (4)   (4)

Total

   $1,150,000,000   100%   $1,150,000,000   $133,515.00
 
 

 

(1) Estimated solely for the purpose of calculating the registration fee under Rule 457(f) of the Securities Act.
(2) The registration fee for the securities offered hereby was calculated under Rule 457(f)(2) of the Securities Act.
(3) See inside facing page for additional registrants.
(4) Pursuant to Rule 457(n) under the Securities Act, no separate filing fee is required for the guarantees.

The Registrants hereby amend this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrants shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

 

 

Table of Contents

TABLE OF ADDITIONAL REGISTRANTS

 

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

TOMKINS, INC.*    Delaware    3990    33-1218687   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS, LLC*    Delaware    3990    99-0360549   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

ACD TRIDON (HOLDINGS) LIMITED    United Kingdom    3585    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

ACD TRIDON INC.    Ontario, Canada    3585    N/A   

P.O. Box 310

300 Henry Street

Brantford ON N3T 5W1,

Canada

+1.416.250.1033

AIR SYSTEM COMPONENTS, INC.    Delaware    3585    23-3023656   

1401 N. Plano Road

Richardson, Texas 75081

+1.972.301.9645

AIR SYSTEMS COMPONENTS INVESTMENTS CHINA LIMITED    United Kingdom    3585    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

AMP INDUSTRIAL MEXICANA, S.A. DE C.V.    Mexico    3585    N/A   

Cerrada Centinela Num. 1782,

Parque Industrial Cachanilla,

Mexicali, B.C., 21394, Mexico

+1.972.943.6150

APLICADORES MEXICANOS,

S.A. DE C.V.

    Mexico    3714    N/A   

Avenida Parques Industriales y

Magneto, Parque Industrial

GEMA, Ciudad Juarez,

Chihuahua, 32310, Mexico

+1.972.301.9645

AQUATIC CO.    Delaware    3430    36-4284100   

8101 E Kaiser Blvd.

Suite 200

Anaheim, California 92808

+1.714.993.1220

AQUATIC TRUCKING CO.    Delaware    3430    31-1631458   

8101 E Kaiser Blvd.

Suite 200

Anaheim, California 92808

+1.714.993.1220

AUTO INDUSTRIAL DE PARTES,

S.A. DE C.V.

    Mexico    3714    N/A   

Lic. Albino Hernandez No 7

Pte., Colonia Obrera, H.

Matamoros, Tamaulipas,

78540, Mexico

Attention: Antonio D’Addona

+52.868.816.0998

BETA NACO LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

 

* Tomkins, Inc. and Tomkins LLC are the co-issuers of the exchange notes offered hereby. The other listed registrants, including Pinafore Holdings B.V., are guarantors of the exchange notes.

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

BRITISH INDUSTRIAL VALVE COMPANY LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

BROADWAY MISSISSIPPI DEVELOPMENT, LLC    Colorado    3990    27-1050109   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

BUFFALO HOLDING COMPANY    Delaware    3990    22-2977811   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

CARRIAGE HOUSE FRUIT COMPANY    California    3990    77-0400825   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

CONERGICS CORPORATION    Delaware    3990    48-0776015   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

DEXTER AXLE ACQUISITION CORP.    Delaware    3714    20-2417200   

2900 Industrial Parkway

Elkhart, Indiana 46516

+1.574.296.7214

DEXTER AXLE COMPANY    Delaware    3714    36-4284104   

2900 Industrial Parkway

Elkhart, Indiana 46516

+1.574.296.7214

DEXTER AXLE TRUCKING COMPANY    Delaware    3714    36-4289434   

2900 Industrial Parkway

Elkhart, Indiana 46516

+1.574.296.7214

DEXTER CHASSIS GROUP, INC.    Michigan    3714    38-3042888   

501 S. Miller

White Pigeon, Michigan 49099

+1.574.296.7214

E INDUSTRIES, INC.    Indiana    3714    37-1437274   

4526 Chester Drive

Elkhart, Indiana 46516

+1.574.522.7550

EASTERN SHEET METAL, INC.    Ohio    3714    31-0932614   

8959 Blue Ash Road

Cincinnati, Ohio 45236

+1.513.793.3440

EIFELER MASCHINENBAU GMBH    Germany    3714    N/A   

Kolumbusstr. 54, 53881

Euskirchen, Germany

+49.2251.256.200

EPICOR INDUSTRIES, INC.    Delaware    3714    36-3672434   

3200 Parker Drive

St. Augustine, Florida 32084

+1.615.355.1137

FBN TRANSPORTATION, INC.    Ohio    3714    04-3726434   

8959 Blue Ash Road

Cincinnati, Ohio 45236

+1.513.793.3440

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

GATES AUTO PARTS HOLDINGS CHINA LIMITED    United Kingdom    3714    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

GATES CIS LLC    Russia    3714    N/A   

1-st Dobryninsky per., building

15/7 #25, Moscow 119049,

Russia

+32.53.762.830

GATES DEVELOPMENT CORPORATION    Colorado    3714    84-1581944   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

GATES ENGINEERING & SERVICES AUSTRALIA PTY LTD ACN 142 531 244    Australia    3714    N/A   

15 Dalzell Turn, Kinross,

Perth, Australia, 6028

+1.61.9258.8399

GATES ENGINEERING & SERVICES HAMRIYAH FZE    United Arab Emirates    3714    N/A   

Plot no. 2M-10, PO Box

49047, Hamriyah Free zone,

Sharjah, United Arab Emirates

+971.4886.1414

GATES ENGINEERING & SERVICES FZCO    United Arab Emirates    3714    N/A   

PO Box 61046

Jebel Ali Free Zone, Dubai, United Arab Emirates

GATES ENGINEERING & SERVICES LTD.    British Virgin Islands    3714    N/A   

Cragmuir Chambers

P.O. Box 71, Road Town,

Tortola, British Virgin Islands

+1.284.494.2233

GATES ENGINEERING & SERVICES UK HOLDINGS LIMITED    United Kingdom    3714    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

GATES FLEXIMAK LTD.    British Virgin Islands    3714    N/A   

Cragmuir Chambers

P.O. Box 71, Road Town,

Tortola, British Virgin Islands

+1.284.494.2233

GATES FLUID POWER TECHNOLOGIES INVESTMENTS LIMITED    United Kingdom    3714    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

GATES GÜÇ AKTARIM SISTEMLERI DAGITIM SANAYI VE TICARET LIMITED SIRKETI    Turkey    3714    N/A   

Peliti Koyu Karacayir Mevkii

2, Bolge, Gebze Kocaeli,

Turkey

+34.93.877.7016

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

GATES HOLDING GMBH    Germany    3714    N/A   

Kolumbusstr. 54, 53881

Euskirchen, Germany

+49.2251.1256.200

GATES HOLDINGS LIMITED    United Kingdom    3714    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

GATES INTERNATIONAL

HOLDINGS, LLC

    Colorado    3714    N/A   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

GATES MECTROL GMBH    Germany    3714    N/A   

Werner von Siemens Strasse 2,

64319 Pfungstadt, Germany

+32.53.762.891

GATES MECTROL, INC.    Delaware    3714    11-3732833   

9 Northwestern Drive,

Salem, New Hampshire 03079

+1.303.744.4939

GATES POWER TRANSMISSION EUROPE BVBA    Belgium    3714    N/A   

Dr. Carlierlaan 30, B-9320 Erembodegem (Aalst),

Belgium

+32.53.762.830

GATES POWERTRAIN PLASTIK METAL VE MAKINA SANAYII VETICARET LIMITED SIRKETI    Turkey    3714    N/A   

Ege Serbest Bolgesi, Gaziemir,

Izmir, 35410, Turkey

+34.93.877.7016

GATES POWERTRAIN UK LIMITED    United Kingdom    3714    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

GLASS MASTER CORPORATION    Texas    3714    74-7624056   

2420 McIver, #101

Carrollton Texas 75006

+1.816.761.7476

H HEATON LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

HART & COOLEY TRUCKING COMPANY    Delaware    3585    61-1436877   

5030 Corporate Exchange

Blvd.

Grand Rapids, Michigan 49512

+1.972.943.6150

HART & COOLEY, INC.    Delaware    3585    52-2206266   

5030 Corporate Exchange

Blvd.

Grand Rapids, Michigan 49512

+1.972.943.6150

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

HYTEC, INC.    Washington    3430    91-0839632   

801 Northern Pacific Road

P.O. Box 1180

Yelm, Washington 98597

+1.714.993.1220

IDEAL CLAMP PRODUCTS, INC.    Tennessee    3714    62-1051193   

8100 Tridon Drive

Smyrna, Tennessee 37172

+1.615.355.1137

KOCH FILTER CORPORATION    Kentucky    3585    61-0674289   

625 W Hill

Louisville, Kentucky 40208

+1.502.634.4796

MONTISK INVESTMENTS NETHERLANDS C.V.    Netherlands    3990    N/A   

Leidsweg 37, 2nd Floor

2252 LA, Voorscholen

The Netherlands

+35.222.8229

NATIONAL DUCT SYSTEMS, INC.    Texas    3585    75-2456831   

1401 Dunn Drive, Suite 110,

Carrollton TX 75006

+1.816.761.7476

NRG INDUSTRIES, INC.

(DELAWARE ENTITY)

    Delaware    3585    75-2452241   

3900 Dr. Greaves Road

Kansas City, Missouri 64030

+1.816.761.7476

NRG INDUSTRIES, INC.

(TEXAS ENTITY)

    Texas    3585    74-1748186   

2405 McIver

Carrollton, Texas 75006

+1.816.761.7476

OLYMPUS (ORMSKIRK) LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

ROOFTOP SYSTEMS, INC.    Texas    3585    75-1908331   

1625 Diplomat Drive,

Carrollton Texas 75006

+1.816.761.7476

RUSKIN AIR MANAGEMENT LIMITED    United Kingdom    3585    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

RUSKIN COMPANY    Delaware    3585    43-1845398   

3900 Dr. Greaves Road

Kansas City, Missouri 64030

+1.816.761.7476

RUSKIN COMPANY CANADA INC.    Ontario, Canada    3585    N/A   

152 East Drive, Brampton

Ontario L6T 1E1, Canada

+1.816.761.7476

RUSKIN DE MÉXICO, S.A. DE C.V.    Mexico    3585    N/A   

Tapioca # 5455-A Infonavit

Ampliacion Aeropuerto

Juarez CHI, Mexico 32698

+1.816.761.7476

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

RUSKIN SERVICE COMPANY    Delaware    3585    43-1871609   

3900 Dr. Greaves Road

Kansas City, Missouri 64030

+1.816.761.7476

SCHRADER ELECTRONICS LIMITED    Northern Ireland    3714    N/A   

11 Technology Park, Belfast Road

Antrim, N. Ireland (UK), BT41 1QS

SCHRADER ELECTRONICS, INC.    Delaware    3714    26-1353225   

101 Evergreen Drive

Springfield, Tennessee 37172

+1.615.384.0089

SCHRADER INTERNATIONAL BRASIL LTDA.    Brazil    3714    N/A   

1600 Avenida Malek Assad,

Bairro Meia Lua, Jacarei, Sao

Paulo, 12303-071, Brazil

+55.3954.6500

SCHRADER INTERNATIONAL HOLDING CO.    Delaware    3714    27-1382757   

205 Frazier Road

Alta Vista, Virginia 24517

+1.303.744.5339

SCHRADER INVESTMENTS LUXEMBOURG S.À R.L.    Luxembourg    3714    N/A   

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

SCHRADER, LLC    Delaware    3714    N/A   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

SCHRADER-BRIDGEPORT INTERNATIONAL, INC.    Delaware    3714    95-3959558   

205 Frazier Road

Alta Vista, Virginia 24517

+1.303.744.5339

SELKIRK AMERICAS, L.P.    Delaware    3714    71-0886085   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

SELKIRK CANADA HOLDINGS, L.P.    Delaware    3714    36-4499487   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

SELKIRK CORPORATION    Delaware    3714    71-0886094   

5030 Corporate Exchange Blvd.

Grand Rapids, Michigan 49512

+1.972.943.6150

SELKIRK IP L.L.C.    Delaware    3714    20-0776546   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

SHIITAKE LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

STACKPOLE INVESTMENTS LIMITED    United Kingdom    3714    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

SWINDON SILICON SYSTEMS LIMITED    United Kingdom    3714    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

THE GATES CORPORATION    Delaware    3990    84-0857401   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS ACQUISITIONS LIMITED    United Kingdom    3990    98-0360549   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS AMERICAN INVESTMENTS S.À R.L.    Luxembourg    3990    N/A   

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS AUTOMOTIVE CANADA LIMITED    Ontario, Canada    3714    N/A   

4123 Yonge Street

North York, Ontario

Canada M2P 2B8

+1.416.250.1033

TOMKINS AUTOMOTIVE COMPANY, S.À R.L.    Luxembourg    3714    N/A   

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS AUTOMOTIVE

HOLDING CO.

    Delaware    3714    26-3004076   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS BUILDING

PRODUCTS, INC.

    Delaware    3990    62-1387341   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS ENGINEERING LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS FINANCE LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS FINANCE LUXEMBOURG LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

TOMKINS FUNDING LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS HOLDINGS LUXEMBOURG, S.À R.L.    Luxembourg    3990    N/A   

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS IDEAL CLAMPS (SUZHOU) INVESTMENTS LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS INDUSTRIES, INC.    Ohio    3990    31-0596713   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS INVESTMENTS CHINA LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS INVESTMENTS COMPANY S.À R.L.    Luxembourg    3990    N/A   

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS INVESTMENTS LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS LUXEMBOURG S.À R.L.    Luxembourg    3990    N/A   

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS MAURITIUS COMPANY LIMITED    Mauritius    3990    N/A   

Felix House, 24 Dr. Joseph

Riviere Street, Port Louis,

Mauritius

+230.216.8800

TOMKINS OVERSEAS COMPANY    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS OVERSEAS HOLDINGS

S.À R.L.

    Luxembourg    3990    N/A   

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

TOMKINS OVERSEAS INVESTMENTS LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS PENSION SERVICES LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS POLY BELT MEXICANA, S.A. DE C.V.    Mexico    3990    N/A   

Km 96.5, Carretera Mexico-

Cuautla #133, Fracc. Los

Faroles, Tetelcingo, Cuautla,

Morelos, 62751, Mexico

+1.303.744.4939

TOMKINS SC1 LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS STERLING COMPANY    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS TREASURY (CANADIAN DOLLAR) COMPANY    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS TREASURY (DOLLAR) COMPANY    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS TREASURY (EURO) COMPANY    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

TOMKINS U.S., L.P.    Delaware    3990    26-3112689   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TRICO PRODUCTS (DUNSTABLE) LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

Table of Contents

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and

Telephone Number,

Including Area Code, of Principal

Executive Offices

TRIDON CLAMP PRODUCTS GMBH    Germany    3714    N/A   

10 Robert-Bosch Street, 53919,

Weilerswist, Germany

+32.53.762.800

TRION (DEUTSCHLAND) GMBH    Germany    3714    N/A   

Oehlecker Ring 26, D-22419,

Hamburg, Germany

+1.972.301.9645

WALTHAM REAL ESTATE

HOLDING CO.

    Delaware    3990    26-3003983   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

WILLER & RILEY LIMITED    United Kingdom    3990    N/A   

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

Table of Contents

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

 

SUBJECT TO COMPLETION, DATED JUNE 24, 2011

PRELIMINARY PROSPECTUS

LOGO

Tomkins, LLC

Tomkins, Inc.

OFFER TO EXCHANGE

 

 

Up to $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 issued by Tomkins, LLC and Tomkins, Inc., as co-issuers, which have been registered under the Securities Act of 1933, for any and all outstanding 9% Senior Secured Second Lien Notes due 2018 (CUSIP Nos. 693492 AC4 and U72209 AB2) issued by Tomkins, LLC and Tomkins, Inc., as co-issuers.

The exchange notes and the guarantees thereof will be the senior obligations of Tomkins, Inc. and Tomkins, LLC, as co-issuers. The exchange notes will be fully and unconditionally guaranteed jointly and severally on a second priority secured basis by Pinafore Holdings B.V., the indirect parent company of Tomkins, LLC and Tomkins, Inc., and certain of Pinafore Holdings B.V.’s domestic and foreign subsidiaries.

 

 

We are conducting the exchange offer in order to provide you with an opportunity to exchange your unregistered notes for freely tradable notes that have been registered under the Securities Act.

Terms of the Exchange Offer:

 

  •  

We will exchange all initial notes that are validly tendered and not validly withdrawn for an equal principal amount of exchange notes that are freely tradable.

 

  •  

You may withdraw tenders of initial notes at any time prior to the expiration date of the exchange offer.

 

  •  

The exchange offer expires at 5:00 p.m., New York City time, on                 , 2011, unless extended.

 

  •  

We will not receive any proceeds from the exchange offer.

 

  •  

We believe that the exchange of initial notes for exchange notes in the exchange offer will not be a taxable event for U.S. federal income tax purposes.

 

  •  

The terms of the exchange notes are substantially identical to the initial notes, except that the exchange notes have been registered under the Securities Act, and transfer restrictions and registration rights relating to the initial notes do not apply to the exchange notes.

All untendered initial notes will continue to be subject to the restrictions on transfer set forth in the initial notes and in the indenture. In general, the initial notes may not be offered or sold, unless registered under the Securities Act, except pursuant to an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws. Other than in connection with the exchange offer, we do not currently anticipate that we will register the initial notes under the Securities Act.

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Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. The Letter of Transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for the initial notes where such initial notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period beginning on the date the exchange offer is consummated and ending on the earlier of 180 days after the date of this prospectus and the date on which a broker-dealer is no longer required to deliver a prospectus in connection with market-making activities or other trading activities, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. See “Plan of Distribution.”

See “Risk Factors” beginning on page 23 for a discussion of certain risks that you should consider before participating in the exchange offer.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the exchange notes to be issued in the exchange offer or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. If you receive any other information, you should not rely on it. We are not making an offer of these securities in any state where the offer is not permitted.

The date of this prospectus is                 , 2011.

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TABLE OF CONTENTS

 

IMPORTANT INFORMATION ABOUT THIS PROSPECTUS

      i   

ENFORCEMENT OF FOREIGN JUDGMENTS AND SERVICE OF PROCESS

      i   

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

      i   

PRESENTATION OF INFORMATION

      iii   

MARKET AND INDUSTRY DATA

      iv   

WHERE YOU CAN OBTAIN MORE INFORMATION

      v   

SUMMARY

      1   

RISK FACTORS

      23   

USE OF PROCEEDS

      44   

CAPITALIZATION

      45   

UNAUDITED PRO FORMA FINANCIAL INFORMATION

      46   

SELECTED HISTORICAL FINANCIAL INFORMATION

      55   

RATIO OF EARNINGS TO FIXED CHARGES

      56   

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

      58   

BUSINESS

      111   

PRINCIPAL SHAREHOLDERS

      127   

MANAGEMENT

      128   

CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

      134   

DESCRIPTION OF CERTAIN INDEBTEDNESS

      135   

THE EXCHANGE OFFER

      138   

DESCRIPTION OF SENIOR SECURED SECOND LIEN NOTES

      148   

BOOK-ENTRY, DELIVERY AND FORM OF SECURITIES

      198   

MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

      200   

ERISA CONSIDERATIONS

      201   

PLAN OF DISTRIBUTION

      203   

LEGAL MATTERS

      204   

EXPERTS

      204   

INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS

      F-1   

We have not authorized any dealer, salesperson or other person to give any information or represent anything to you other than the information contained in this prospectus. You must not rely on unauthorized information or representations.

This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. The information in this prospectus is current only as of the date on its cover, and may change after that date.

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Following the date of this prospectus, we will be subject to reporting obligations and any filings we make will be available via the website of the United States Securities and Exchange Commission, or SEC, at www.sec.gov. You can also obtain any filed documents regarding us without charge by written or oral request to:

Pinafore Holdings B.V.

Fred. Roeskestraat 123

1076 EE

Amsterdam

The Netherlands

Attn. Thomas C. Reeve

Executive Vice President and General Counsel – Tomkins Limited

Tel: +31.20577.1177

Please note that copies of documents provided to you will not include exhibits.

In order to receive timely delivery of requested documents in advance of the expiration date of the exchange offer, you should make your request no later than                 , 2011, which is five business days before you must make a decision regarding the exchange offer.

See “Where You Can Obtain More Information.”

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IMPORTANT INFORMATION ABOUT THIS PROSPECTUS

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell or a solicitation of an offer to buy any of these securities to any person in any jurisdiction where it is unlawful to make this type of an offer or solicitation.

ENFORCEMENT OF FOREIGN JUDGMENTS AND SERVICE OF PROCESS

Pinafore Holdings B.V. (“Holdings” or the “Company”) is a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands, and certain of its directors and executive officers are residents of The Netherlands. In addition, a substantial portion of the assets owned by us and the aforesaid individuals are located outside the United States. Similarly, many of the guarantors of the notes are organized under the laws of various jurisdictions outside of the United States. As a result, it may be difficult or impossible for you to effect service of process upon us or any of the aforesaid persons within the United States with respect to matters arising under the U.S. federal securities laws or to enforce against us or any of such persons judgments of U.S. courts predicated upon the civil liability provisions of the U.S. federal securities laws. Service of process in U.S. proceedings on persons in The Netherlands, however, is regulated by a multilateral treaty guaranteeing service of writs and other legal documents in civil cases if the current address of the defendant is known. The competent Dutch court will apply Dutch private international law to determine which laws will be applicable to any private law claim brought before it and apply that law to such claim. It is uncertain whether a Dutch court would apply or enforce the civil liability provisions of U.S. Federal securities laws.

We have been advised by our Dutch counsel that in the absence of an applicable treaty or convention providing for the recognition and enforcement of judgments in civil and commercial matters, other than arbitral awards, between the United States of America and the Netherlands, a judgment of a court in the United States of America (the “U.S. Judgment”) is not automatically enforceable in the Netherlands.

To obtain an enforceable judgment against the Dutch subsidiaries in the Netherlands, the matter will need to be re-litigated before the competent court in The Netherlands. In the course of such proceedings, the U.S. Judgment will have to be submitted to the relevant court in the Netherlands, and the Dutch court may give the effect to the U.S. Judgment as it deems appropriate.

According to current practice, however, based upon case law, Dutch courts will be expected to render a judgment in accordance with the U.S. Judgment, if and to the extent that: (i) the court rendering the U.S. Judgment had jurisdiction over the subject matter of the litigation on internationally acceptable grounds and has conducted the proceedings in accordance with general principles of fair trial; (ii) the U.S. Judgment is final and definite; and (iii) such recognition is not in conflict with an existing Dutch judgment or with Dutch public policy (i.e. a fundamental principle of Dutch Law).

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts included in this prospectus, including without limitation, statements under the captions “Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” and included elsewhere in this prospectus regarding the prospects of our industry and our prospects, plans, financial position and business strategy, may constitute forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “plan,” “foresee,” “believe” or “continue” or the negatives of these terms or variations of them or similar terminology. You are cautioned not to place undue reliance on the forward-looking statements which speak only as of the date that the statement was made. Important factors that could cause actual results to differ materially from our expectations are disclosed in this prospectus, including in conjunction with the forward-looking statements included in this prospectus and under “Risk Factors.” All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements included in this prospectus.

 

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We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors, including those discussed in this prospectus under the headings “Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Some of the factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include:

 

  •  

global and general economic conditions, including those specific to our end markets;

 

  •  

significant global operations and global expansion;

 

  •  

the impact of natural disasters and terrorist attacks;

 

  •  

regulations applicable to our global operations;

 

  •  

our ability to compete successfully with other companies in our industry;

 

  •  

the cost and availability of raw materials;

 

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the cyclical nature of the non-residential construction industry;

 

  •  

the downturn in the residential construction industry;

 

  •  

the potential loss of key personnel;

 

  •  

product liability claims against us;

 

  •  

the sufficiency of our insurance policies to cover losses, including liabilities arising from litigation;

 

  •  

failure to develop and maintain intellectual property rights;

 

  •  

the demand for our products by automakers;

 

  •  

our ability to integrate acquired companies into our business and the success of our acquisition strategy;

 

  •  

environmental, health and safety laws and regulations;

 

  •  

currency fluctuations from our international sales;

 

  •  

labor shortages, labor costs and collective bargaining agreements;

 

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equipment failures, explosions and adverse weather;

 

  •  

potential inability to obtain necessary capital;

 

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the few principal stockholders who control us;

 

  •  

risks related to the notes, to the collateral and to high yield securities generally;

 

  •  

our significant indebtedness;

 

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  •  

the dependence on the subsidiaries of Holdings for cash to meet our debt obligations; and

 

  •  

other risks and uncertainties, including those listed under the caption “Risk Factors.”

Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this prospectus are made only as of the date hereof. Readers are cautioned that the foregoing list of risk factors is not exhaustive and that the forward-looking statements contained in this prospectus are expressly qualified by this cautionary statement. We do not undertake and specifically decline any obligation to update any such statements or to publicly announce the results of any revisions to any of such statements to reflect future events or developments.

PRESENTATION OF INFORMATION

Financial and Other Information

On July 27, 2010, the Independent Directors of Tomkins plc (“Tomkins”) and the Board of Directors of Pinafore Acquisitions Limited (now known as Tomkins Acquisitions Limited) announced that they had reached an agreement on the terms of a recommended cash acquisition (the “Acquisition”) for the entire share capital of Tomkins, including the Tomkins shares underlying the Tomkins ADRs and certain employee equity awards, implemented by way of a scheme of arrangement under Part 26 of the U.K.’s Companies Act 2006. Predecessor results for periods prior to the Acquisition on September 24, 2010 (“Predecessor”) have been presented separately from Successor results subsequent to the Acquisition (“Successor”).

Prior to the Acquisition, Tomkins drew up its annual financial statements to the Saturday nearest December 31. Accordingly, Predecessor consolidated financial statements are presented for the 53-week period from December 30, 2007 to January 3, 2009 (“Fiscal 2008”), the 52-week period from January 4, 2009 to January 2, 2010 (“Fiscal 2009”), and the 38-week period from January 3, 2010 to September 24, 2010 (“9M 2010”). The Predecessor financial statements do not reflect the effects of the accounting for, or the financing of, the Acquisition. Holdings draws up its annual financial statements to December 31. Although Holdings was incorporated on September 1, 2010, it had no assets or liabilities (other than the proceeds of the ordinary shares issued on incorporation) and no operations prior to the Acquisition. Accordingly, this prospectus contains Successor consolidated financial statements that present the results of the Successor’s operations for the 14-week period from September 25, 2010 to December 31, 2010 (“Q4 2010”).

Holdings draws up its quarterly financial statements to the Saturday nearest the end of the relevant fiscal quarter. We have included in this prospectus the unaudited condensed consolidated financial statements of Holdings for the 13-week period from January 1, 2011 to April 2, 2011 (“Q1 2011”) that were made available to holders of the Notes on May 17, 2011.

The audited consolidated financial statements do not contain results for the year ended December 31, 2010 (“Fiscal 2010”). As Holdings had and has no interest in any operations other than those of Tomkins, comparison of the results of the Successor with those of the Predecessor is hindered only by the effects of the accounting for, and the financing of, the Acquisition. For the purposes of facilitating the discussion of Fiscal 2010 compared with Fiscal 2009 and Q1 2011 with Q1 2010, we therefore refer in Management’s Discussion and Analysis to our unaudited pro forma condensed consolidated income statement for Fiscal 2010 and for Q1 2010 that is presented in “Unaudited Pro Forma Financial Information” included elsewhere in this prospectus. The unaudited pro forma financial information has been prepared in accordance with SEC Regulation S-X Article 11 and incorporates adjustments that give effect to the Transactions as if they had occurred on January 3, 2010 but excludes items of income and expense that arose in connection with the Transactions but will not have a continuing impact for us beyond the twelve months following completion of the Transactions. The unaudited pro forma financial information for Fiscal 2010 and for Q1 2010 does not comply with International Financial Reporting Standards (“IFRS”) or accounting principles generally accepted in the United States of America (“U.S. GAAP”) and does not purport either to represent actual results or to be indicative of results we might achieve in future periods.

 

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During Fiscal 2009, we substantially completed our long-term program of exiting our non-core businesses. We distinguish within our continuing operations between those of our operating segments that are ongoing, which we identify as “ongoing segments”, and those that we have exited but do not meet the conditions to be classified as discontinued operations, which we identify as “exited segments.”

Our consolidated financial statements have been prepared in accordance with IFRS, which differs in certain respects from U.S. GAAP.

We assess the performance of our businesses using a variety of measures. Certain of these measures are not explicitly defined under IFRS and are therefore termed “non-GAAP measures.” Under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” we identify and explain the relevance of each of the non-GAAP measures referenced herein, show how they are calculated and present a reconciliation to the most directly comparable measure defined under IFRS. We do not regard these non-GAAP measures as a substitute for, or superior to, the equivalent measures defined under IFRS. The non-GAAP measures that we use may not be directly comparable with similarly-titled measures used by other companies.

MARKET AND INDUSTRY DATA

Certain market, ranking and industry data included in this prospectus, including the size of certain markets and our size or position and the positions of our competitors within these markets, including our products and services relative to our competitors, are based on estimates of our management. These estimates have been derived from our management’s knowledge and experience in the markets in which we operate, as well as information obtained from surveys, reports by market research firms, our customers, distributors, suppliers, trade and business organizations and other contacts in the markets in which we operate. You should not place undue reliance on them as estimates are inherently uncertain. Additionally, we have cited information compiled by certain industry sources and third parties, including:

 

  •  

Automotive Aftermarket Industry Association, “Digital Automotive Aftermarket Factbook, 20th Edition, 2011” (“AAIA”);

 

  •  

CSM Worldwide, Inc., a division of IHS Global Insight Inc. (“IHS/CSM”);

 

  •  

JD Power and Associates, “Automotive Forecasting Report, June 30, 2010” (“J.D. Power”);

 

  •  

McGraw-Hill Companies, “Dodge Construction Potential Bulletin, December 2010 (“Dodge”);

 

  •  

McGraw-Hill Companies, “Construction Market Forecasting Service, Sneak-Peek First Quarter 2011” (“McGraw-Hill”);

 

  •  

U.S. Bureau of the Census, “Construction Reports, Series C-20, Housing Starts” (“U.S. Census Bureau Housing Starts);

 

  •  

Housingeconomics.com, National Association of Home Builders, “Executive Level Forecast, March 31, 2011” (“NAHB”); and

 

  •  

U.S. Bureau of the Census, “Construction Reports, Series C-30, Value of New Construction Put-in-Place” (“U.S. Census Bureau”).

While we believe the data from these sources to be accurate and complete, we have not independently verified data from these sources or obtained third party verification of market share data and do not guarantee the accuracy or completeness of this information. In addition, these sources may use different definitions of the relevant markets. Data regarding our industry is intended to provide general guidance, but is inherently imprecise. Market share data is subject to change and cannot always be verified with certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey of market shares. In addition, customer preferences can and do change. As a result,

 

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you should be aware that market share, ranking and other similar data set forth herein, and estimates and beliefs based on such data, may not be reliable. References herein to our being a leader in a market or product category refers to our belief that we have a leading market share position in each specified market, unless the context otherwise requires. In addition, the discussion herein regarding our various markets is based on how we define the markets for our products, which products may be either part of larger overall markets or markets that include other types of products and services.

The term “emerging markets” as used in this prospectus refers to those countries defined by the International Monetary Fund as “emerging and developing economies” for the purposes of their “World Economic Outlook Database, October 2010.”

WHERE YOU CAN OBTAIN MORE INFORMATION

We have filed with the SEC a registration statement on Form F-4 under the Securities Act with respect to the exchange notes being offered in this prospectus. This prospectus, which forms a part of the registration statement, does not contain all of the information set forth in the registration statement. For further information with respect to us and the exchange notes, reference is made to the registration statement. Statements contained in this prospectus as to the contents of any contract or other document are not necessarily complete, and, where such contract or other document is an exhibit to the registration statement, each such statement is qualified by the provisions in such exhibit to which reference is hereby made.

We are not currently, and prior to the effectiveness under the Securities Act of this registration statement, are not expected to be, required to file reports with the SEC for the unregistered notes or to deliver an annual report to holders of the unregistered notes under the Exchange Act. However, we are subject to the disclosure obligations described in “Description of Senior Secured Second Lien Notes—Certain Covenants—Reports and Other Information.” Under these obligations, as long as the notes are outstanding, we will furnish you with certain annual and quarterly financial information and, for as long as the notes are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, we will furnish you, or any prospective purchaser of the exchange notes you designate, with the information required to be delivered by Rule 144A(d)(4) under the Securities Act when we receive a written request to do so from you. Written requests for the information should be addressed to Thomas C. Reeve, Executive Vice President and General Counsel – Tomkins Ltd., Pinafore Holdings B.V., Fred. Roeskestraat 123, 1076 EE, Amsterdam, The Netherlands.

As a result of the offering of the exchange notes, we will become subject to the informational requirements of the Exchange Act and, in accordance therewith, will file reports and other information with the SEC. The registration statement and other information can be inspected and copied at the Public Reference Room of the SEC located at Room 1580, 100 F Street, N.E., Washington D.C. 20549. Copies of such materials, including copies of all or any portion of the registration statement, can be obtained from the Public Reference Room of the SEC at prescribed rates. You can call the SEC at 1-800-SEC-0330 to obtain information on the operation of the Public Reference Room. Such materials may also be accessed electronically by means of the SEC’s home page on the Internet (http://www.sec.gov).

 

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SUMMARY

This summary highlights information included elsewhere in this prospectus. You should read the entire prospectus carefully, including the risks discussed in the “Risk Factors” section and the historical financial statements and the notes thereto before making an investment decision. This summary may not contain all of the information that may be important to you.

On July 27, 2010, the Independent Directors of Tomkins plc (“Tomkins”) and the Board of Directors of Pinafore Acquisitions Limited (now known as Tomkins Acquisitions Limited) (“Tomkins Acquisitions”) announced that they had reached an agreement on the terms of a recommended cash acquisition (the “Acquisition”) for the entire share capital of Tomkins, including the Tomkins shares underlying the Tomkins American Depositary Receipts and certain employee equity awards, implemented by way of a scheme of arrangement under Part 26 of the U.K.’s Companies Act 2006 (the “Scheme”). Tomkins Acquisitions was a newly incorporated company formed for the purpose of implementing the Acquisition at the direction of Onex Corporation (“Onex”) and Canada Pension Plan Investment Board (“CPPIB,” collectively the “Sponsors”). Tomkins, LLC and Tomkins, Inc. are indirect wholly owned subsidiaries of Tomkins Acquisitions. On August 31, 2010, the requisite majorities of Tomkins’ shareholders voted to approve the Acquisition. On September 21, 2010, the High Court of Justice in England and Wales (the “Court”) sanctioned the Scheme and a Court hearing to confirm the corresponding reduction in share capital of Tomkins plc occurred on September 23, 2010. The Court-issued orders pursuant to the Court hearings were registered and became effective on September 24, 2010.

When used in this prospectus, the terms “Tomkins,” the “Company,” “we,” “our” and “us,” except as otherwise indicated or as the context otherwise indicates, means Pinafore Holdings B.V. (“Holdings”) and its subsidiaries, including, Tomkins Acquisitions, Tomkins, LLC and Tomkins, Inc., after giving effect to the consummation of the Acquisition.

Unless stated otherwise, all references to amounts for Fiscal 2010 presented in this summary are on a pro forma basis as described further in “Unaudited Pro Forma Financial Information.”

Our Company

We are a diversified global engineering and manufacturing company with a portfolio of market-leading businesses. Our products are highly engineered and used in the industrial, automotive and construction end markets. We have a broad collection of premier brands that are among the most globally recognized in their respective end markets, and we estimate that approximately 80% of our sales for Fiscal 2010 were derived from businesses that hold the number one position in the markets in which they operate. Approximately 38% of our Fiscal 2010 sales were generated from the global industrial replacement end market and automotive aftermarket, where we achieve higher margins. Our industrial replacement business provides us with exposure to a broad range of industrial end market segments that have an ongoing need for replacement parts, while the automotive aftermarket provides us with a stable source of revenue. The significant majority of our products, including those useful for the reduction of energy consumption and for safety improvement, are positioned in the premium end of their respective end markets, and as a result, allow for associated premium pricing. The prices of our products are low relative to the potential cost of their failure within the critical systems in which they are used, such as industrial machinery, automotive engines and heating, ventilating and air conditioning (“HVAC”) systems. We attribute our end market leadership positions to a combination of our brand strength, product quality and breadth and customer service and support. We are led by an experienced, proven management team that has successfully streamlined our portfolio to focus on our core businesses, and implemented wide-ranging, significant cost-saving restructuring initiatives.

Our revenue and earnings base is highly diversified by product, geography, end market and customer. We derive revenues from nearly every developed country across the globe and are well-positioned in most emerging markets with our industrial and automotive component products. In addition, our top ten customers represented only 23% of our Fiscal 2010 sales. We maintain long-standing customer relationships and have served our top 20 customers for an average of over 35 years, while some of our largest customer relationships span over 50 years. We also have developed strong relationships with industry-leading customers in emerging markets including Chery, Tata and Mahindra & Mahindra.

 

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Our product portfolio consists of tens of thousands of SKUs, and we believe it comprises the broadest range of power transmission belts, fluid power hoses and air distribution products in the end markets in which we operate. This breadth, combined with our brand reputation, product quality, superior field sales and service support, long-standing customer relationships and ability to deliver on short lead times, has allowed us to establish and maintain our leading market positions.

During Fiscal 2010, we generated sales of $4.9 billion and our pro forma Adjusted EBITDA was $732.9 million. Capital expenditure during Fiscal 2010 was $155.9 million. For a discussion of our pro forma Adjusted EBITDA, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Our Fiscal 2010 sales can be broken down as follows:

LOGO

Our Segments

Our business is divided into two business groups: Industrial & Automotive (“I&A”), which accounted for 80% of our Fiscal 2010 sales and Building Products (“BP”), which comprised the remaining 20% of our Fiscal 2010 sales. Our I&A businesses include: (i) Gates—the leading global manufacturer of power transmission belts and related products, as well as hydraulic and industrial hose and couplings; (ii) Schrader—the global leader in automotive tire pressure monitoring systems (“TPMS”); (iii) Dexter—the leading North American manufacturer of axles used in utility, industrial and recreational trailers; and (iv) several other businesses. Our BP businesses collectively are the leading North American manufacturer of products used in the HVAC systems of commercial and residential buildings, including grilles, registers, diffusers (“GRDs”), terminal units, dampers, louvers and smoke vents, among other products. We also manufacture bathtubs and shower enclosures primarily used in residential applications.

The following table illustrates our business groups’ Fiscal 2010 sales, Fiscal 2010 Adjusted EBITDA and market position and estimated market share.

 

    

INDUSTRIAL & AUTOMOTIVE

80% OF SALES AND

87% OF ADJUSTED EBITDA

  

BUILDING PRODUCTS

20% OF SALES AND

13% OF ADJUSTED EBITDA

   

Power

Transmission

  

Fluid Power

  

Sensors & Valves

  

Other I&A

  

Air Distribution

  

Bathware

SALES

$ IN MILLIONS

   2,136.7   784.5   402.2   548.8   862.9   118.8
% OF TOTAL   44%   16%   8%   12%   18%   2%
KEY PRODUCTS  

• Accessory

  drive and

  synchronous

  belts

• Idler pulleys

  and tensioners

• Fuel efficient

  oil pumps

• Powder metal

  components

  

• Hydraulic

  hoses and

  couplings

• Transfer hoses

• Engine hoses

  and assemblies

• Hose service

  and management

  

• TPMS

• Wheel and

  tire valves

• Air conditioning

  valves

• Specialty valves

• Inflating gauges

  

• Axles

• Chassis

  components

• Standard and

  specialty hose

  clamps

• Aftermarket

  accessories

  

• GRDs

• Terminal units

• Dampers

• Louvers

• Smoke vents

• Chimney

  products

• Air filters

  

• Fiberglass

  bathtubs

• Acrylic bathtubs

• Shower

  enclosures

 

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INDUSTRIAL & AUTOMOTIVE

80% OF SALES AND

87% OF ADJUSTED EBITDA

  

BUILDING PRODUCTS

20% OF SALES AND

13% OF ADJUSTED EBITDA

   

Power
Transmission

  

Fluid Power

  

Sensors & Valves

  

Other I&A

  

Air Distribution

  

Bathware

BRANDS /

BUSINESSES

   LOGO  

LOGO

  

LOGO

  

LOGO

  

LOGO

LEADING

MARKET

POSITION

(MARKET

SHARE %)

  

• #1 in North America, Central

  America and South America

  industrial power transmission (35%)

• #1 in North America auto

  aftermarket power transmission

  and fluid power (30%)

• #1 in European auto aftermarket

  for synchronous belts (65%)

  and accessory drive belts (35%)

• U.S. fluid power (25%)

  

• #1 in global

  TPMS (50%)

  

• Dexter #1 in U.S.

  industrial

  axles (50%)

• Ideal #1 in U.S.

  standard gear

  clamps (60%)

  

• ASC #1 in U.S.

  Commercial

  GRDs (50%)

• Ruskin #1 in U.S.

  dampers (30%)

• Hart & Cooley

  #1 in U.S. venting

  products (30%)

  

• #1 in U.S.

  fiberglass

  bathtubs (30%)

FISCAL 2010

SALES

BREAKDOWN

BY END

MARKET (1)

  

• Auto AM: 34%

• Auto OEM:41%

• Ind. Rep: 15%

• Ind. OEM: 10%

  

• Auto AM: 20%

• Auto OEM: 0%

• Ind. Rep: 49%

• Ind. OEM: 31%

  

• Auto AM: 18%

• Auto OEM: 77%

• Ind. Rep: 0%

• Ind. OEM: 5%

  

• Auto AM: 16%

• Auto OEM: 3%

• Ind. Rep: 17%

• Ind. OEM: 46%

• Mfr. Housing/

  Rec. Vehicles: 18%

  

• Non-Res.: 74%

• Res.: 26%

  

• Res.: 96%

• Mfr. Housing: 4%

SELECT

CUSTOMERS

  

• GM

• Genuine Parts

  (NAPA &

  Motion

  Industries)

• Ford

• Renault Nissan

• O’Reilly

• SKF Autoparts

• ADI

• CARQUEST

  

• Genuine Parts

  (NAPA &

  Motion

  Industries)

• John Deere

• JCB

• O’Reilly

• Bobcat

• CARQUEST

• CNH Global

• Caterpillar

  

• GM

• Ford

• Chrysler

• Nissan

• Genuine

  Parts (NAPA)

• Mercedes

• Subaru

• Siemens

• PSA

  

• Redneck Trailer

  Supplies

• Jayco

• Forest River

• Thor Industries

• Nuera

• Home Depot

• Textrail

• Repco

• Fernco

  

• York Intl

• Lennox

• Tom Barrow

• Home Depot

• Norman S.

  Wright

• Carrier Group

• Trane Co

• Watsco

• Ferguson

  

• Home Depot

• Ferguson

• Hajoca

• WinWholesale

• Morrison

 

(1) “Auto AM”=Auto Aftermarket, “Auto OEM”=Auto Original Equipment Manufacturers, “Ind. Rep”=Industrial Replacement, “Ind. OEM”=Industrial Original Equipment Manufacturers, “Mfr. Housing” = Manufactured Housing (i.e., trailer homes), “Rec. Vehicles”=Recreational Vehicles (i.e., motorhomes), “Non-Res.”=Non-Residential Construction, “Res.”=Residential Construction.

Industrial & Automotive

Power Transmission. We are the world’s largest manufacturer of power transmission belts used in industrial equipment and automotive applications. Our Power Transmission products are sold under the Gates brand and include highly-engineered rubber and polyurethane accessory drives and synchronous belts, idler pulleys and tensioners. We are globally integrated with operations in 21 countries and maintain research, development and engineering capabilities worldwide. The largest component of our Power Transmission sales is to leading distributors for use in the industrial replacement end market and automotive aftermarket, which are higher margin businesses. The industrial replacement end market covers a broad range of industries, which have an ongoing need for replacement parts. The automotive aftermarket provides us with a stable source of revenue. We supply aftermarket belts and related components for substantially all light vehicles in North America and Europe. We also sell Power Transmission products directly to industrial and automotive original equipment manufacturers (“OEMs”). For Fiscal 2010, 63% of Power Transmission’s automotive OEM sales were to customers located outside of North America, primarily in continental Europe and Asia, including Renault, PSA/Peugeot, Mercedes, Hyundai and Chery. The end market segments for our industrial products are broad and primarily cover applications such as general industrial, agricultural equipment and motorcycles. We also have a nascent presence in elevators, white goods and wind turbines. The industrial replacement end market and automotive aftermarket collectively represented 49% of Power Transmission’s Fiscal 2010 sales, while 41% of Fiscal 2010 sales were to the automotive OEM end market. The remaining 10% of Fiscal 2010 sales were generated from the industrial OEM end market.

 

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Fluid Power. We are a leading manufacturer of hydraulic hoses, couplings and transfer hoses used in industrial applications and in the automotive aftermarket. Our hydraulic hoses and couplings are used in technically demanding operations and must be able to withstand extreme operating conditions. Our Fluid Power products are sold under the Gates brand and are used in a variety of end market segments, such as general industrial, construction, agriculture, oil and gas, mining and energy. We have continued to broaden our Fluid Power platform by providing hydraulic service offerings (e.g., tracking, monitoring and replacement, as well as hydraulic flushing services) to the oil and gas, marine and mining end market segments. Fluid Power has a global footprint across 13 countries and serves customers worldwide such as Motion Industries, John Deere, JCB, Bobcat and Caterpillar. The industrial replacement end market accounted for 49% of Fluid Power’s Fiscal 2010 sales, while 31% of Fiscal 2010 sales were to the industrial OEM end market and 20% of Fiscal 2010 sales were to the automotive aftermarket.

Sensors & Valves. Through our Schrader Electronics and Schrader International businesses we are the global leader in TPMS and maintain a share of approximately 50% of the global market for TPMS products. This technology allows drivers to remotely monitor their vehicle’s tire pressure using electronic sensors attached to tire valves. Currently, our TPMS products are sold primarily to automotive OEMs that produce passenger vehicles for the U.S. market, where TPMS has been a mandatory safety system on all light vehicles since 2007. Recent legislation was passed in Europe that will mandate the use of TPMS on all new models introduced into the European passenger vehicle market starting in 2012, and all newly manufactured passenger vehicles starting in November 2014. This new legislation is expected to double the TPMS market size by the end of 2014. In addition, we believe there will be a significant aftermarket opportunity in both the United States and Europe for our Sensors & Valves products as the installed base of vehicles with TPMS continues to grow.

Other I&A. Other I&A is comprised of three businesses, Dexter, Ideal and Plews. Dexter accounts for more than half of Other I&A’s sales. Dexter is the leading manufacturer of axle components for the utility, industrial trailer and recreational vehicle end market segments in the United States. Dexter sells products directly to OEMs and through national distributors. Ideal is the leading manufacturer of gear clamps primarily for the automotive aftermarket and sells principally in the United States, Mexico and China under a variety of brands. Plews, a wholly-owned manufacturer of automotive lubrication products and repair tools, was sold on April 20, 2011 to a consortium of investors in the US led by the private equity firm, Eigen Capital LLC. In Fiscal 2010, Plews’ sales were approximately $70 million. The cash consideration of $25 million received on the disposal approximated to the carrying amount of the net assets sold.

Building Products

Air Distribution. We are the leading North American manufacturer of products that are used to distribute, recycle and vent air, and which are critical components of HVAC systems within non-residential and residential buildings. We design and manufacture a broad range of products, including, among others, GRDs, terminal units, fire and smoke dampers, louvers and fans for customers throughout North America. Our products are marketed under many established and well-known brand names including, Titus, Krueger, Ruskin and Hart & Cooley. We believe that we are the only nationwide U.S. provider of air distribution products across many of the primary categories in which we compete and we have an extensive multi-channel distribution network across the country. The majority of our products are sold through manufacturers’ representatives and building products wholesalers. The balance of our products are sold directly to HVAC OEMs, such as Carrier Group, York International and Lennox, as well as to home centers, specialty retailers and national accounts. We maintain a competitive advantage in this business by offering the broadest range of products, providing industry-leading customer service and delivering customized products on short lead times. Our portfolio of brands is recognized as representing the highest quality products, and building architects and engineers often specify them by name in building designs. The non-residential construction end market represented 74% of Air Distribution’s Fiscal 2010 sales, while 26% of Fiscal 2010 sales were to the residential construction end market. Within Air Distribution, 75% of Fiscal 2010 sales were into the new construction end market segment, while 25% of Fiscal 2010 sales were into the repair and refurbishment (“R&R”) end market segment, which includes all sales to home centers such as Home Depot and Lowes.

Bathware. We are a leading manufacturer of bathtubs and shower enclosures in the United States, accounting for approximately 30% of all fiberglass bathtubs sold in 2009. Our products are sold under the Aquatic brand name primarily through building products wholesalers, home center retailers and specialty distributors. Aquatic operates manufacturing plants and distribution warehouses across the United States, providing national distribution capabilities. The residential end market accounted for 96% of Bathware’s Fiscal 2010 sales, while the remaining 4% of Bathware’s Fiscal 2010 sales comprised sales to the manufactured housing industry.

 

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Our End Markets

We operate a portfolio of global, market-leading businesses that manufacture and sell branded products for the industrial OEM and replacement, automotive OEM, automotive aftermarket, non-residential construction and residential construction end markets. Each end market has unique characteristics and drivers that contribute to our overall revenue diversification, stability and provide broad exposure to general economic growth. We expect that the cyclical nature of the industrial and automotive OEM end markets and the industrial aftermarket will benefit us to the extent there continues to be a recovery from recessionary lows. Additional end market demand characteristics that we believe we will continue to benefit from are: (i) the resilience, stability and higher-margin nature of the automotive aftermarket principally in North America and Europe and (ii) the continued secular growth in industrial and automotive OEM and replacement end markets in emerging markets globally. We also anticipate benefiting from the eventual recovery in the U.S. non-residential construction and residential construction end markets.

Industrial OEM & Replacement

We generated 32% of our Fiscal 2010 sales from the global industrial OEM and replacement end markets. Our Power Transmission and Fluid Power segments operating under the Gates brand accounted for 76% of our Fiscal 2010 sales to the industrial OEM and replacement end markets. Our industrial belts are used in manufacturing equipment, commercial vehicles, agricultural and construction equipment as well as a broad range of consumer and industrial products and applications. Our industrial fluid power products are used within hydraulic systems, for example, on construction equipment and to transfer and convey fluids, as well as food, water, steam, oil, chemicals, gas and air and serve the general industrial, construction, agriculture, oil and gas, marine and mining industries.

We believe the demand for our products in the industrial OEM and replacement end markets will continue to be driven by (i) the level of industrial production and capacity utilization, both of which still remain below long-term averages in North America and Europe, (ii) the level of durable goods orders and operating expenditures related to consumable items used in industrial production, (iii) the level of construction activity which drives demand for construction equipment that utilize our products, (iv) the level of global commodity prices that impact demand and utilization of equipment in a number of our end market segments including agriculture and oil and gas and (v) continued emerging market growth and infrastructure build.

Automotive OEM

We generated 25% of our Fiscal 2010 sales from supplying the global automotive OEM end market. Our Power Transmission segment operating under the Gates brand accounted for 73% of our Fiscal 2010 sales for this end market. The demand in this end market is directly related to global vehicle production. According to IHS/CSM, from 2000 through 2010, annual light vehicle production averaged 14.6 million units in North America and 19.5 million units in Europe. Current automotive industry conditions in North America and Europe have demonstrated early signs of recovery, though are still significantly below long-run averages. In 2010, North American production recovered to 11.9 million units from 8.6 million units the year before. In Europe, production increased by 13%, rising from 16.3 million units in 2009 to 18.5 million units in 2010. Approximately 11% of our automotive OEM sales are derived from the Chinese market where production grew at an annualized growth rate of 24% between 2004 and 2010. IHS/CSM forecasts 2011 to 2015 annualized light vehicle production growth of 6% globally, with 5% in North America, 5% in Europe and 7% in China. Evolving consumer preferences and recent regulations have made fuel economy and safety systems a growth area for automotive OEM suppliers, which we believe will benefit our business. Many of the products that we sell to the automotive OEM end market have been shown to improve safety and fuel economy, which positions us well to benefit from the trend toward safer, more fuel-efficient vehicles.

We believe the demand for our products in the automotive OEM end market will continue to be driven by (i) the level of global vehicle production, (ii) our ability to secure positions on new vehicle platforms relative to our competitors and (iii) evolving regulatory requirements related to fuel economy and safety.

 

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Automotive Aftermarket

We generated 21% of our Fiscal 2010 sales from the automotive aftermarket primarily through our Gates products. Though the automotive aftermarket is influenced by fuel prices and consumer confidence, it is typically resilient during economic downturns. This resilience is a result of the stable underlying demand for replacement products, which is more influenced by non-discretionary maintenance and repair needs than it is by economic factors. For example, according to IHS/CSM, U.S. light vehicle production fell 34% in 2009 compared with the prior year, whereas, according to AAIA, aggregate U.S. automotive aftermarket sales declined only 2% during 2009 compared with the prior year. The U.S. light vehicle aftermarket represented $207 billion in aggregate sales in 2009 and is expected to reach over $230 billion by 2012, a compound annual growth rate (“CAGR”) of 4%, according to AAIA estimates. Global vehicle production is also an aftermarket revenue growth driver as it adds to the aggregate global vehicle population. JD Power estimates that the world’s total vehicle population in 2009 was 1.0 billion and expects it to grow at a CAGR of 3% from 2009 through 2015. In particular, JD Power expects that total vehicle population in emerging markets will continue to grow significantly during that period, with CAGRs of 14% in China and 10% in India, which should aid the development of the still nascent automotive aftermarket in those countries.

We believe that the demand for our products in the automotive aftermarket will continue to be driven by: (i) the size of the global vehicle population, which increases by the level of annual new vehicle production less the annual scrap rate, (ii) the average age of the global vehicle population as older vehicles typically require greater maintenance and repair and (iii) annual miles driven which correlates to the rate of vehicle wear and consequently demand for aftermarket products.

Non-Residential Construction

We generated 13% of our Fiscal 2010 sales from the non-residential construction end market, primarily from our Air Distribution segment. U.S. non-residential construction activity has been in decline since 2008, and, according to Dodge, in 2010, U.S. non-residential construction starts totaled 635 million square feet as compared with an average of 1.2 billion square feet over the 2006 to 2010 time period. McGraw-Hill is forecasting that the market will continue to stabilize in 2011 followed by more rapid growth in 2012 and 2013. Within our Air Distribution business group, approximately 25% of our Fiscal 2010 sales were derived from R&R activities. We believe this will be a growth area given the increasing global drive to reduce energy consumption in buildings, which many of our products achieve. Globally, buildings use approximately one-third of the world’s energy, 25% of which is attributable to buildings’ air distribution systems. Our energy efficient air distribution products can help reduce energy consumption in this area.

We believe that demand in the non-residential construction end market, which is inherently local in nature, will be driven by underlying dynamics including: (i) local office vacancy rates, which are tied to employment levels, (ii) the availability of financing for new construction projects, (iii) public and private spending on healthcare, education and other social services and (iv) trends in the development of new urban areas and the re-development of existing urban areas.

Residential Construction

We generated 7% of our Fiscal 2010 sales from the residential construction end market, including the R&R end market segment. The U.S. residential construction end market has been weak throughout 2010 and early 2011, with seasonally adjusted annualized housing starts standing at 549,000 at the end of March 2011, compared with the total housing starts in 2010 of 587,000 units and the historical average housing start rate between 1980 and 2010 of 1.4 million units (as measured by the U.S. Census Bureau Housing Starts). According to the NAHB, housing starts are expected to recover to approximately 900,000 units by 2012 as long-term demographic factors and an expected economic recovery lead to absorption of the current excess housing supply. However, despite signs of recent stabilization and the long-term positive outlook for new residential construction, recent housing starts data suggests that near-term demand will continue to be restrained. According to the U.S. Census Bureau, R&R spending has declined 23% since 2006, and we expect it to resume growth as consumer confidence and unemployment improve.

We believe that demand in the new residential construction end market segment will continue to be driven by: (i) consumer confidence and employment levels, (ii) availability of financing along with interest rate stability, (iii) on-going population growth and relocation trends and (iv) the level of existing home sales which impacts housing inventory levels as well as the level of R&R activity.

 

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Our Competitive Strengths

Industry Leading Businesses with Premier Brands. We believe that we hold the number one market position in businesses that comprise approximately 80% of our Fiscal 2010 sales. We have achieved this leadership position by offering high quality products, industry-leading product portfolios that typically consist of tens of thousands of SKUs and superior customer service and field sales support, all of which drive brand loyalty and secure our long-standing brand reputations and customer relationships. The strength of our brands has been highlighted by our demonstrated ability to pass through or adjust prices for changes in input costs, and in certain markets to charge a premium price relative to our competitors. Our principal brands include the following:

 

  •  

Gates is the world’s largest manufacturer of power transmission belts and a leader in hydraulic and industrial hoses and couplings. The Gates brand has existed since 1917 and is globally synonymous with premium quality, reliability and customer service. Gates has approximately a 30% share of the overall automotive aftermarket for power transmission and fluid power products in North America. In its target market, which is the “do-it-for-me” traditional and retail, light vehicle automotive aftermarket in North America, Gates has a 40% share. In Europe, we estimate that Gates has approximately a 65% share of the synchronous belt market and approximately a 35% share of the accessory drive belt market.

 

  •  

ASC, Ruskin and Hart & Cooley are three of the leading manufacturers of air distribution products in North America. Each of our primary Air Distribution brands maintains a share in excess of 30% of their respective product categories, and ASC, through several brands, has a share in excess of 50% of the market for commercial GRDs in the United States.

 

  •  

Schrader is the world leader in TPMS for passenger vehicles with a global market share of approximately 50%.

 

  •  

Dexter is North America’s leading manufacturer of axles used in specialty utility, industrial and recreational trailers, which are typically made-to-order, with a U.S. market share in excess of 50% for those products.

 

  •  

Ideal is the leading gear clamp manufacturer with a market share in the United States of approximately 60%.

 

  •  

Aquatic is the leading producer of value-oriented fiberglass bathtubs, accounting for approximately 30% of all fiberglass bathtubs sold in 2009 in the United States.

Diversified Revenue and Earnings Base. We benefit from serving a diverse group of end markets and customers across the globe. This diversity helps mitigate the impact of any individual decline in any one end market during a given year. Approximately 38% of our Fiscal 2010 sales were generated from the global industrial replacement end market and automotive aftermarket, where we achieve higher margins. Our industrial replacement business provides us with exposure to a broad range of industrial end market segments that have an ongoing need for replacement parts. Our customer base consists of many of the world’s leading companies in their respective end markets, and it is broad and distinct across our segments, with no single customer representing more than 7% of our Fiscal 2010 sales. We generate revenue in most developed countries across the globe, and our emerging market presence has grown rapidly to now represent approximately 22% of our Fiscal 2010 I&A sales.

Broad Product Offering of Highly Engineered and Critical Components. Our broad product portfolio consists of tens of thousands of SKUs, which allows us to provide our customers with a comprehensive range of products. Most of our products are highly engineered components that perform critical functions within larger and more expensive systems, including industrial machinery, automotive engines and commercial HVAC applications.

 

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The prices of our products are low relative to the potential cost of their failure within the critical systems in which they are used. Our engineering and new product development capabilities have contributed to our reputation as an innovator, solidifying our leadership position across our product categories. Additionally, our extensive product portfolio, strong brand reputation, intellectual property, knowledge and expertise applied across our broad range of SKUs, make us a valued partner to our customers and increases their reluctance to switch suppliers. Working with our customers to design and develop solutions tailored to their individual specifications is a valuable service that we provide, which further decreases their propensity to switch suppliers.

Long-Standing Customer and Distributor Relationships. We have cultivated long-standing customer relationships due to our strong brand reputation, consistent ability to meet product availability requirements, superior customer service and best-in-class quality. Some of our relationships with our largest customers span over 50 years. Our relationships with our top 20 customers have existed for more than 35 years on average. We believe we have cultivated relationships with an estimated 75% of the U.S. and European wholesale distributors to the automotive aftermarket, and are a key supplier to three of the largest North American distributors and retailers, NAPA, O’Reilly Auto Parts (both more than 50 years) and CARQUEST (approximately 45 years). In Europe, we have long-standing customer relationships with the leading automotive aftermarket distributors in each of Germany, France and the U.K. We maintain relationships with the largest global industrial replacement distributors, including Motion Industries (approximately 45 years) and Kaman (approximately 40 years). We have also cultivated exclusive relationships with over 100 leading distributors in the North American non-residential and residential construction end markets and maintain thousands of relationships for broad market coverage. Our extensive distribution network, comprehensive product portfolio and made-to-order components make it difficult for smaller domestic and emerging market competitors to penetrate our end markets.

Low-Cost Manufacturing and Global Engineering Footprint. Many of our manufacturing facilities are located in low-cost, emerging markets, including China, Mexico, Brazil, India, Eastern Europe and Turkey. We have substantially rebased our manufacturing footprint towards lower cost, higher growth regions, as we have opened, among other things, three new facilities in China, India and Turkey, while closing approximately 30% of our North American and European facilities in 2008 and 2009. As a result, we are positioned to realize continued margin growth as our end markets recover. We have already realized some of this margin expansion with the ongoing Adjusted EBITDA margin increasing 570 basis points (“bps”) between the first half of 2009 and Fiscal 2010. Continued international expansion allows us to conduct our engineering and manufacturing activities close to our customers across the globe, as well as to develop new relationships and to benefit from the higher growth rates in emerging markets.

Strong Margins and Free Cash Flow Generation. Our operating model generates strong profit margins and stable cash flows. In Fiscal 2010 we achieved an ongoing Adjusted EBITDA margin of 15.1%, compared with 11.1% in Fiscal 2009 and 12.0% in Fiscal 2008. We achieved this improvement in part through our two broad plant rationalization programs that were largely completed in 2008 and 2009, which we refer to as projects Eagle and Cheetah. Under these initiatives we closed more than 30 loss-making, redundant and underperforming facilities in North America and Western Europe and exited low-margin and unprofitable automotive OEM businesses, which were capital intensive, as well as unprofitable Building Products businesses. After significant investments in lower cost regions, we currently have relatively lower capital expenditure requirements than we did in the past, which we expect to continue even if the end market recovery accelerates.

Experienced and Proven Management Team. We are led by an experienced management team that implemented a successful and significant restructuring program and reshaped our business portfolio through an extensive divestiture and rationalization program. Our management team is led by Jim Nicol who joined Tomkins in 2002 as CEO. Under his leadership, we have:

 

  •  

Executed projects Eagle and Cheetah, which we estimate will generate approximately $150 million in annual savings from 2011 onwards.

 

  •  

Divested or closed 26 non-core lower margin and commodity businesses to focus on higher margin, less capital intensive businesses.

 

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  •  

Established a portfolio of industry-leading industrial, automotive and building product businesses.

 

  •  

Improved the ongoing Adjusted EBITDA margin by 310 bps in Fiscal 2010 compared with Fiscal 2008, despite sales being approximately 18% below the pre-restructuring levels of Fiscal 2007.

 

  •  

Embedded a culture of pay for performance throughout our organization.

Our Business Strategy

Leverage the Gates Brand. We will continue to leverage our Gates brand and footprint, which is globally recognized by our customers as the highest quality power transmission belt brand and a leader in the fluid power market. We aim to enhance Gates’ strong reputation for superior quality, reliability and customer service by growing our service and distribution capabilities in the global industrial OEM and replacement end market and automotive aftermarket. We will also continue to invest in: (i) product development, such as our polyaramid-reinforced belts for motorcycles, carbon cord polychain belts, molded fabric belts used in high torque engines, belt boxes within wind turbines, ocean wave power generation systems and oil and gas applications and (ii) service capabilities, such as installing, monitoring, refurbishing and advising on system design for hydraulic applications in the oil and gas, marine and mining end market segments.

Utilize Global Presence and Brand Strength to Further Penetrate Emerging Markets. We continue to expand our market share in emerging markets such as China, Brazil, India and Eastern Europe, and our sales to emerging markets have grown from approximately 10% of I&A sales in 2004 to approximately 22% in Fiscal 2010. Gates has established and maintained a sales and manufacturing presence in both China and India since 1995. We have authorized distributors in almost all of China’s provinces, that have a total of over 130 retail stores across the country. We have recently completed new facilities to serve these markets, including our Fluid Power plant in Changzhou, China, which became operational in early 2010 and is the largest fluid power facility in our portfolio. We have also expanded our operations in India, Eastern Europe and Turkey, where we believe the recent high growth of light vehicle sales and industrial activity are expected to continue in the future. The automotive aftermarket opportunity in many of these emerging markets remains in its early stages as the average age of vehicles in these markets is currently lower than the age range that generates the most aftermarket activity, which is approximately five to ten years. Additionally, industrial activity is expected to increase with economic growth, which drives the industrial OEM and replacement end markets. We believe that exposure to these geographies will continue to drive our growth as automotive production increases, the aftermarket develops and general infrastructure and economic growth continues to expand at attractive rates.

Capitalize on Demand for Energy Efficient Products. We believe that we were among the first manufacturers to identify the growing environmentally-focused product trends in our industries and end markets. We continue to engineer products to enhance their energy and fuel efficiency. Such products include synchronous timing belts for micro-hybrid systems, TPMS and variable vane oil pumps in our I&A businesses and energy recovery ventilators in our BP business. Demand for the advanced technology content integrated into these products continues to grow. In addition, a number of new regulatory guidelines in North America have emerged to promote energy efficient products in new non-residential and residential construction.

Further Enhance Margins and Free Cash Flow Generation. We will continue to develop product offerings across our businesses that contain proprietary technology and leverage our strong brands resulting in an ability to offer premium products and generate attractive margins. In response to a difficult economic climate, we have also reduced our fixed cost base. In 2008 and 2009, we substantially completed all of our comprehensive restructuring initiatives (projects Eagle and Cheetah), closing over 30 facilities and reducing headcount under these initiatives by 7,800. We anticipate reaching the full run-rate savings of $150 million during 2011. Our continual performance improvement initiatives within our plants is expected to enhance our margins further. We also believe our available manufacturing capacity and existing geographical plant footprint is sufficient to support significant increases in volume, which will result in positive operating leverage as the economy recovers. Additionally, many of our more capital-intensive operations, including several of our low-margin, more commodity-oriented automotive OEM businesses, have been divested over the past few years as part of a full-scale management initiative to focus on higher margin, lower capital intensity businesses.

 

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Target Opportunities for Which There is a Significant Replacement Market. We will continue to develop our technology to manufacture market-leading products and then follow with aftermarket sales and support using such technology. This strategy has been successful across the Gates brand where products were customized for use in systems designed by OEMs then sold directly to the aftermarket to satisfy replacement needs. We have taken a similar approach in other areas such as Schrader with TPMS. We believe the aftermarket will continue to develop following the regulation-induced OEM adoption of the technology in the United States and Europe. R&R activities, which are becoming a growing revenue driver in our BP business group, accounted for 25% of Air Distribution’s Fiscal 2010 sales.

Capitalize on Eventual Cyclical End Market Recovery. Although all of our end markets were impacted by the recent global economic recession to varying degrees, we believe many of our end markets have troughed and are experiencing varying degrees of recovery, with ongoing sales up 17% in Fiscal 2010 over Fiscal 2009, driven by increased demand throughout our global industrial and automotive end markets, as well as some amount of inventory re-stocking at our customers.

Continue to Evaluate Strategic Opportunities. We will continue to evaluate our portfolio on a strategic basis and seek to expand our presence in emerging markets. We may also consider divesting non-core businesses that may be less strategic in order to accelerate the deleveraging of our balance sheet.

Our Equity Sponsors

Onex Corporation

Onex is one of North America’s oldest and most successful investment firms committed to acquiring and building high-quality businesses in partnership with talented management teams. It was founded in 1984, is listed on the Toronto Stock Exchange and operates out of offices in Toronto and New York. Onex manages investment platforms focused on private equity, real estate and credit securities. In total, Onex manages approximately $15 billion, which includes both third-party and proprietary capital. Onex’ businesses generate annual revenues of $35 billion, have assets of $40 billion and employ more than 212,000 people worldwide.

Over Onex’ history, it has had extensive experience investing in industrial, automotive and building products businesses. Onex’ recent investments in these sectors include Allison Transmission, TMS International, RSI Home Products and Spirit Aerosystems.

Canada Pension Plan Investment Board

CPPIB is a professional investment management organization that invests the funds not needed by the Canada Pension Plan to pay current benefits on behalf of 17 million Canadian contributors and beneficiaries. In order to build a diversified portfolio of CPPIB assets, CPPIB invests in public equities, private equities, real estate, inflation-linked bonds, infrastructure and fixed income instruments. Headquartered in Toronto, with offices in London and Hong Kong, CPPIB is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. At March 31, 2011, the assets of the Canada Pension Plan Fund totaled C$148 billion, of which C$32 billion was invested in private investments.

The Transactions

On July 27, 2010, Tomkins Acquisitions and the independent directors of Tomkins announced that they had agreed to the terms of a recommended cash acquisition of the entire issued and to be issued share capital of Tomkins, including the shares underlying the ADRs, by Tomkins Acquisitions for approximately £2.89 billion, to be implemented by way of the Scheme. The Scheme became effective on September 24, 2010. In connection with the Acquisition the following transactions occurred:

 

  •  

the Sponsors capitalized Tomkins Acquisitions (through its parent companies) with an aggregate equity contribution of approximately $2.1 billion;

 

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  •  

we drew down on the term loan portion of our senior secured credit facilities consisting of (i) a senior secured Term Loan A facility of $300.0 million; (ii) a senior secured Term Loan B facility of $1,700.0 million and (iii) a senior secured revolving credit facility of $300.0 million (no amounts were initially drawn) (collectively, our “senior secured credit facilities”);

 

  •  

we received the net proceeds from the sale of the initial notes;

 

  •  

we commenced a tender offer for Tomkins’ 8% medium term notes due 2011 (the “2011 Notes”) and Tomkins Finance plc’s 6.125% medium term notes due 2015 (the “2015 Notes” and together with the 2011 Notes, the “medium term notes”);

 

  •  

on the effective date of the Scheme, each ordinary share in the capital of Tomkins held by shareholders of Tomkins (except those shares held by shareholders of Tomkins who validly elected to receive loan notes in respect of some or all of their shares) were automatically cancelled and shareholders received 325 pence for each ordinary share held prior to cancellation, and upon cancellation of such shares, ordinary shares of $0.09 each in the capital of Tomkins (which have an aggregate nominal value equal to the aggregate nominal value of the cancelled shares) were issued to Tomkins Acquisitions; and

 

  •  

those shares held by shareholders of Tomkins who validly elected to receive loan notes in respect of some or all of their shares were transferred to Tomkins Acquisitions, and such shareholders received loan notes with a nominal value of £1.00 per loan note on the basis of £1.00 worth of loan notes for every £1.00 of cash consideration that would otherwise be payable to such shareholder.

We refer to the Scheme, the Acquisition, the equity contribution, the borrowings under our senior secured credit facilities, the initial notes, the tender for the medium term notes and the other transactions described above as the “Transactions.” Subsequent to the completion of the Transactions, on November 19, 2010, we informed the medium term noteholders that a ratings downgrade had occurred, and certain holders of the medium term notes put their medium term notes to us. On December 30, 2010, we made a further offer to purchase the outstanding 2011 Notes at a price of 105.00% (plus accrued and unpaid interest). Acceptances were received in respect of £4.9 million of the 2011 Notes. Settlement took place on January 19, 2011. On February 11, 2011, we agreed with the providers of the senior secured credit facilities to a re-pricing of Term Loan A and term loan B and amendments to certain of the covenants and other provisions of the senior secured credit facilities. The re-pricing became effective on February 17, 2011 and attracted a one-off premium payment by us of $16.8 million.

Ownership and Corporate Structure

Our simplified corporate structure following the Transactions is shown below. Except for entities in certain jurisdictions of organization, the entities inside the dotted box represent the Guarantors of the notes and the senior secured credit facilities. In addition, Pinafore Coöperatief (“Top Co-op”) and the entities represented by Gates Non-U.S. Subsidiaries are non-guarantors. The non-guarantor subsidiaries and any future non-guarantor subsidiaries are separate and distinct legal entities and have no obligation, contingent or otherwise, to pay any amounts due pursuant to the notes, or to make any funds available therefore, whether by dividends, loans, distribution or other payments. The non-guarantor subsidiaries accounted for the following proportion of our ongoing operations: (i) 41% of pro forma sales in Fiscal 2010 and of sales in Q1 2011; (ii) 47% of pro forma Adjusted EBITDA in Fiscal 2010 and 49% of Adjusted EBITDA in Q1 2011; (iii) 45% of total assets at the end of Fiscal 2010 and at the end of Q1 2011; and (iv) 14% of total liabilities at the end of Fiscal 2010 and 14% of total liabilities at the end of Q1 2011. Both (i) and (ii) are calculated excluding corporate center entities. See “Description of Senior Secured Second Lien Notes—Note Guarantees.”

 

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LOGO

Company Information

Tomkins was formed in London in 1925 under the name F. H. Tomkins Buckle Company Limited. On February 25, 1988, we changed our name to Tomkins plc and on September 24, 2010, Tomkins plc was converted into a private limited company, Tomkins Limited. Pinafore, LLC was formed as a Delaware limited liability company and Pinafore, Inc. was organized as a Delaware corporation for purposes of undertaking the offering of initial notes as co-issuers. On December 8, 2010, Pinafore, LLC and Pinafore, Inc. changed their names to Tomkins, LLC and Tomkins Inc., respectively. Pinafore Holdings B.V. is a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands. registered offices are located at Fred. Roeskestraat 123, 1076 EE, Amsterdam, The Netherlands. Our telephone number at this address is +31.20577.1177. Our website is www.tomkins.co.uk. Information on, or accessible through, our website is not part of this prospectus, nor is such content incorporated by reference herein.

 

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THE EXCHANGE OFFER

The following summary contains basic information about the exchange offer and the exchange notes. It does not contain all the information that may be important to you. For a more complete understanding of the exchange notes, please refer to the sections of this prospectus entitled “The Exchange Offer” and “Description of Senior Secured Second Lien Notes.”

On September 29, 2010, the issuers issued an aggregate of $1,150,000,000 million principal amount of 9% Senior Secured Second Lien Notes due October 1, 2018 (the “initial notes”) to a group of initial purchasers in reliance on exemptions from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws. As part of the offering, we entered into a registration rights agreement with the initial purchasers of the initial notes in which we agreed, among other things, to deliver this prospectus and to complete an exchange offer for such initial notes. Below is a summary of the exchange offer.

 

The Exchange Offer    Tomkins, LLC and Tomkins, Inc. (together, the “issuers”) are offering to exchange up to $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018, which have been registered under the Securities Act (the “exchange notes”), for any and all outstanding initial notes. The term “notes” refers to both the initial notes and the exchange notes.
  

To exchange your initial notes, you must properly tender them, and the issuers must accept them. You may tender outstanding initial notes only in denominations of the principal amount of $2,000 and integral multiples of $1,000 in excess thereof. The issuers will exchange all initial notes that you validly tender and do not validly withdraw prior to the withdrawal of the exchange offer. The issuers will issue registered exchange notes promptly after the expiration of the exchange offer.

 

The form and terms of the exchange notes will be substantially identical to those of the initial notes except that the exchange notes will have been registered under the Securities Act. Therefore, the exchange notes will not be subject to certain contractual transfer restrictions, registration rights and certain additional interest provisions applicable to the initial notes prior to consummation of the exchange offer.

 

Upon completion of the exchange offer, there may not be a market for the initial notes and you may have difficulty selling them.

Resale of Exchange notes    We believe that, if you are not a broker-dealer, you may offer exchange notes (together with the guarantees thereof) for resale, resell and otherwise transfer the exchange notes (and the related guarantees) without complying with the registration and prospectus delivery requirements of the Securities Act if you:
      •    acquired the exchange notes in the ordinary course of business;
      •    are not engaged in, do not intend to engage in and have no arrangement or understanding with any person to participate in a “distribution” (as defined under the Securities Act) of the exchange notes; and
      •    are not an “affiliate” (as defined under Rule 405 of the Securities Act) of the issuers or any guarantor.

 

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   If any of these conditions are not satisfied, you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction. Our belief that transfers of exchange notes would be permitted without registration or prospectus delivery under the conditions described above is based on the interpretations of the SEC given to other, unrelated issuers in transactions similar to the exchange offer. We cannot assure you that the SEC would take the same position with respect to the exchange offer.
Broker-Dealers    Each broker-dealer that receives exchange notes for its own account in exchange for initial notes, where the initial notes were acquired by it as a result of market-making activities or other trading activities, may be deemed to be an “underwriter” within the meaning of the Securities Act and must acknowledge that it will deliver a prospectus that meets the requirements of the Securities Act in connection with any resale of the exchange notes. However, by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act. See “Plan of Distribution.”
Expiration Date    The exchange offer will expire at 5:00 p.m., New York City time, on                 , 2011, unless we extend it.
Withdrawal    You may withdraw your tender of initial notes under the exchange offer at any time prior to the expiration date of the exchange offer. We will return to you any of your initial notes that are not accepted for any reason for exchange, without expense to you, promptly after the expiration or termination of the exchange offer. Any withdrawal must be in accordance with the procedures described in “The Exchange Offer—Withdrawal Rights.”
Conditions to the Exchange Offer    The exchange offer is subject to customary conditions which we may assert or waive. The exchange offer is not conditioned upon any minimum principal amount of initial notes being tendered for exchange. See “The Exchange Offer—Conditions to the Exchange Offer.”
Procedures for Tendering Initial Notes    Each holder of initial notes that wishes to tender initial notes for exchange notes pursuant to the exchange offer must, before the exchange offer expires, either:
      •    transmit a properly completed and duly executed letter of transmittal, together with all other documents required by the letter of transmittal, including the initial notes, to the exchange agent; or
      •    if initial notes are tendered in accordance with book-entry procedures, arrange with The Depository Trust Company (“DTC”), to cause to be transmitted to the exchange agent an agent’s message indicating, among other things, the holder’s agreement to be bound by the letter of transmittal,
   or comply with the procedures described below under “— Guaranteed Delivery.”

 

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   A holder of initial notes that tenders initial notes in the exchange offer must represent, among other things, that:
      •    the holder is not an “affiliate” of the issuers or any guarantor as defined under Rule 405 of the Securities Act;
      •    the holder is acquiring the exchange notes in its ordinary course of business;
      •    the holder is not engaged in, does not intend to engage in and has no arrangement or understanding with any person to participate in a distribution of the exchange notes within the meaning of the Securities Act;
      •    if the holder is a broker-dealer that will receive exchange notes for its own account in exchange for initial notes that were acquired as a result of market-making or other trading activities, then the holder will deliver a prospectus in connection with any resale of the exchange notes; and
      •    the holder is not acting on behalf of any person who could not truthfully make the foregoing representations.
   Do not send letters of transmittal, certificates representing initial notes or other documents to us or DTC. Send these documents only to the exchange agent at the address given in this prospectus and in the letter of transmittal.
Special Procedures for Tenders by Beneficial Owners of Initial Notes    If:
      •    you beneficially own initial notes;
      •    those initial notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee or custodian; and
      •    you wish to tender your initial notes in the exchange offer,
   you should contact the registered holder as soon as possible and instruct it to tender the initial notes on your behalf and comply with the instructions set forth in this prospectus and the letter of transmittal.
Guaranteed Delivery    If you hold initial notes in certificated form or if you own initial notes in the form of a book-entry interest in a global note deposited with the trustee, as custodian for DTC, and you wish to tender those initial notes but
      •    the certificates for your initial notes are not immediately available or all required documents are unlikely to reach the exchange agent before the exchange offer expires; or
      •    you cannot complete the procedure for book-entry transfer prior to the expiration date,

 

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   you may tender your initial notes in accordance with the procedures described in “The Exchange Offer—Procedures for Tendering Initial Notes—Guaranteed Delivery Procedures.”
Consequences of Not Exchanging Initial Notes    If you do not tender your initial notes or we reject your tender, your initial notes will remain outstanding and will continue to be subject to the provisions in the indenture regarding the transfer and exchange of the initial notes and the existing restrictions on transfer set forth in the legends on the initial notes. In general, the initial notes may not be offered or sold unless registered under the Securities Act, except pursuant to an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws. Holders of initial notes will not be entitled to any further registration rights under the registration rights agreement.
   You do not have any appraisal or dissenters’ rights in connection with the exchange offer.
   To the extent that initial notes are tendered and accepted in the exchange offer, the trading market for initial notes that remain outstanding after the exchange offer could be adversely affected.
Registration Rights Agreement    You are entitled to exchange your initial notes for exchange notes with substantially identical terms. This exchange offer satisfies this right. After the exchange offer is completed, you will no longer be entitled to any exchange or registration rights with respect to your initial notes.
Certain Tax Considerations    Your exchange of initial notes for exchange notes will not be treated as a taxable exchange for United States income tax purposes.
Use of Proceeds    We will not receive any cash proceeds from the exchange offer.
Acceptance of Initial Notes and Delivery of Exchange notes    Subject to the satisfaction or waiver of the conditions to the exchange offer, we will accept for exchange any and all initial notes properly tendered prior to the expiration of the exchange offer. We will complete the exchange offer and issue the exchange notes promptly after the expiration of the exchange offer.
Exchange Agent    Wilmington Trust FSB is serving as exchange agent for the exchange offer. The address and the facsimile and telephone numbers of the exchange agent are provided in this prospectus under “The Exchange Offer—Exchange Agent” and in the letter of transmittal.

 

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THE EXCHANGE NOTES

The exchange offer applies to the $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018. The form and the terms of the exchange notes will be identical in all material respects to the form and the terms of the initial notes except that the exchange notes:

 

  •  

will have been registered under the Securities Act;

 

  •  

will not be subject to restrictions on transfer under the Securities Act; and

 

  •  

will not be entitled to the specified rights under the registration rights agreement, including the provisions providing for registration rights and the payment of additional interest in specified circumstances.

The exchange notes evidence the same debt as the initial notes exchanged for the exchange notes and will be entitled to the benefits of the same indenture under which the initial notes were issued, which are governed by New York law. See “Description of Senior Secured Second Lien Notes.”

 

Issuers    Tomkins, LLC and Tomkins, Inc.
Securities Offered    $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018.
Maturity Date    October 1, 2018
Interest    9% per annum
Interest Payment Dates    April 1 and October 1 of each year, commencing April 1, 2011
Guarantees   

The exchange notes will be fully and unconditionally guaranteed, jointly and severally, on a second priority senior secured basis by Holdings and certain of its subsidiaries (other than the issuers), subject to certain exceptions. See “Description of Senior Secured Second Lien Notes—Note Guarantees.”

 

The non-guarantor subsidiaries and any future non-guarantor subsidiaries are separate and distinct legal entities and have no obligation, contingent or otherwise, to pay any amounts due pursuant to the exchange notes, or to make any funds available therefor, whether by dividends, loans, distribution or other payments. The non-guarantor subsidiaries accounted for the following proportion of our ongoing operations: (i) 41% of pro forma sales in Fiscal 2010 and of sales in Q1 2011; (ii) 47% of pro forma Adjusted EBITDA in Fiscal 2010 and 49% of Adjusted EBITDA in Q1 2011; (iii) 45% of total assets at the end of Fiscal 2010 and at the end of Q1 2011; and (iv) 14% of total liabilities at the end of Fiscal 2010 and at the end of Q1 2011. Both (i) and (ii) are calculated excluding corporate center entities. In the event that Rule 3-10 of Regulation S-X under the Securities Act would require separate financial statements of any subsidiary that is a Guarantor to be filed with the SEC solely because such subsidiary’s guarantee is not a full and unconditional guarantee as reasonably determined by Holdings such guarantee will be automatically discharged and release. In the case of such discharge and release,

 

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   the exchange notes would no longer be guaranteed by such entity even though the guarantee by such entity of our senior secured credit facilities would continue.
Collateral   

The exchange notes will be secured by a second priority lien on substantially all of the assets of the issuers and Guarantors, subject to certain exceptions, permitted liens and the terms of the second lien intercreditor agreement described below.

 

The security supporting the exchange notes may be reduced in certain instances without a comparable reduction in the security supporting the senior secured credit facilities. You should read “Description of Senior Secured Second Lien Notes—Security for the Notes” for a more complete description of the security granted to the holders of the exchange notes.

Intercreditor Agreement    The liens securing the exchange notes are subordinated to those securing our senior secured credit facilities and subject to the terms of the second lien intercreditor agreement. The terms of such intercreditor agreement are set forth under “Description of Senior Secured Second Lien Notes—Security for the Notes.”
Optional Redemption   

On or after October 1, 2014, the issuers may redeem some or all of the exchange notes at any time at the redemption prices described in the section “Description of Senior Secured Second Lien Notes—Optional Redemption.” Prior to October 1, 2014, the issuers may redeem some or all of the exchange notes at a price equal to 100% of the principal amount of the exchange notes redeemed plus accrued and unpaid interest and additional interest, if any, to the redemption date plus the “applicable premium.”

 

Additionally, on or prior to October 1, 2013, the issuers may redeem (i) up to 35% of the aggregate principal amount of the exchange notes with the net proceeds of specified equity offerings at the redemption price specified in the “Description of Senior Secured Second Lien Notes—Optional Redemption” and (ii) no more than once in any twelve-month period, up to 10% of the original aggregate principal amount of the exchange notes at a price equal to 103% of the principal amount thereof, in each case, plus accrued and unpaid interest and additional interest, if any, to the redemption date.

Change of Control    If a change of control occurs, the issuers must give holders of the exchange notes an opportunity to sell to them their exchange notes at a purchase price in cash equal to 101% of the principal amount of such exchange notes, plus accrued and unpaid interest to the date of purchase. The term “Change of Control” is defined under “Description of Senior Secured Second Lien Notes—Change of Control.”
Ranking    The exchange notes and guarantees will constitute the issuers’ and the Guarantors’ senior secured debt. Subject to the contractual arrangements described above under “Collateral” and “Intercreditor Agreement,” they will rank:
   •    effectively senior in right of payment with all of the issuers’ and the Guarantors’ existing and future senior unsecured debt to the extent of the collateral securing the exchange notes;

 

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   •    senior to all of the issuers’ and the Guarantors’ existing and future subordinated debt;
   •    effectively subordinated to all of the issuers’ and the Guarantors’ first priority secured debt, including the borrowings under the issuers’ senior secured credit facilities, to the extent of the collateral securing such debt.
Restrictive Covenants    The indenture governing the exchange notes will contain covenants that limit the ability of the issuers and certain of their subsidiaries’ ability to:
   •    incur or guarantee additional indebtedness;
   •    issue qualified stock and preferred stock;
   •    pay dividends and make other restricted payments;
   •    create or incur certain liens;
   •    make certain investments;
   •    engage in sales of assets and subsidiary stock; and
   •    transfer all or substantially all of the issuers’ assets or enter into merger or consolidation transactions.
No Public Market    The exchange notes are new securities and there is currently no established trading market for the exchange notes. The initial purchasers have advised us that they presently intend to make a market in the exchange notes. However, you should be aware that they are not obligated to make a market in the exchange notes and may discontinue their market-making activities at any time without notice. As a result, a liquid market for the exchange notes may not be available if you try to sell your exchange notes. We do not intend to apply for a listing of the exchange notes on any securities exchange or any automated dealer quotation system.
Use of Proceeds    We will not receive any proceeds from the exchange offer. See “Use of Proceeds.”

 

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SUMMARY FINANCIAL DATA

The following table sets forth our summary historical financial information and summary unaudited pro forma financial information for the periods and dates indicated. The following information is only a summary and should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Unaudited Pro Forma Financial Information” and the consolidated audited financial statements of our business and notes thereto included elsewhere in this prospectus, as well as the other financial information included in this prospectus.

The summary historical balance sheet data as of December 31, 2010 and January 2, 2010, and the summary historical income statement and cash flow data for Q4 2010, 9M 2010, Fiscal 2009 and Fiscal 2008 have been prepared in accordance with IFRS and have been derived from the audited consolidated financial statements included elsewhere in this prospectus.

The summary historical balance sheet data as of April 2, 2011, and the summary historical income statement and cash flow data for Q1 2011 and Q1 2010 have been prepared in accordance with IFRS and have been derived from the unaudited condensed consolidated financial statements included elsewhere in this prospectus.

The summary unaudited pro forma financial information gives effect to the Events described in “Unaudited Pro Forma Financial Information” as if these events had occurred on January 3, 2010. The data is for information purposes only and does not purport to present what our results of operations would have been had the Events actually occurred on that date, nor does it project our results of operations for any future period. For information regarding the pro forma effects of the Events, see “Unaudited Pro Forma Financial Information.”

 

     Successor     Predecessor     Pro Forma     Successor     Predecessor  
     Q1 2011     Q1 2010     Fiscal     Q4 2010     9M 2010     Fiscal Year  
$ in millions        2010         2009     2008  

Selected income statement data:

                     

Continuing operations

                     

Sales

    $ 1,342.9     $ 1,165.9      $ 4,853.9      $ 1,289.2       3,564.7      $ 4,180.1      $ 5,515.9   

Cost of sales

      (923.8 )        (801.9 )        (3,362.8 )      (1,038.1 )      (2,437.7 )      (2,995.9 )      (4,023.7 ) 
                                                        

Gross profit

      419.1        364.0        1,491.1        251.1        1,127.0        1,184.2        1,492.2   

Distribution costs

      (140.6 )      (125.7 )      (527.0 )      (144.6 )      (382.4 )      (464.8 )      (584.5 ) 

Administrative expenses

      (184.3 )      (112.9 )      (686.1 )      (230.8 )      (358.2 )      (480.4 )      (513.3 ) 

Transaction costs

      (0.4 )      —          (0.6 )      (78.2 )      (41.5 )      —          —     

Impairments

      —          —          —          —          —          (73.0 )      (342.4 ) 

Restructuring costs

      (5.4 )      (1.9 )      (12.0 )      (2.0 )      (10.0 )      (144.1 )      (26.0 ) 

Net gain on disposals and on the exit of businesses

      0.2        1.4        6.3        —          6.3        0.2        43.0   

Gain on amendment of post-employment benefits

      —          —          —          —          —          63.0        —     

Share of profit/(loss) of associates

      0.3        0.1        (0.6 )      0.7        (1.3 )      (0.4 )      (2.1 ) 
                                                        

Operating profit/(loss)

      88.9        125.0        271.1        (203.8 )      339.9        84.7        66.9   

Interest expense

      (91.1 )      (24.1 )      (361.4 )      (90.9 )      (71.8 )      (113.2 )      (137.8 ) 

Investment income

      18.2        16.2        66.9        18.7        48.2        67.2        87.8   

Other finance income/(expense)

      11.0        (2.4 )      25.3        (27.1 )      (2.7 )      (0.3 )      (25.0 ) 
                                                        

Net finance costs

      (61.9 )      (10.3 )      (269.2 )      (99.3 )      (26.3 )      (46.3 )      (75.0 ) 
                                                        

Profit/(loss) before tax

      27.0        114.7        1.9        (303.1 )      313.6        38.4        (8.1 ) 

Income tax (expense)/benefit

      (19.3 )      (29.2 )      34.6        32.9        (62.8 )      (28.5 )      (38.4 ) 
                                                        

Profit/(loss) for the period from continuing operations

      7.7        85.5        36.5        (270.2 )      250.8        9.9        (46.5 ) 

Discontinued Operations

                     

Loss for the period from discontinued operations

      —          (0.8 )      (7.2 )      —          (7.2 )      (3.9 )      —     
                                                        

Profit/(loss) for the period

      7.7        84.7        29.3        (270.2 )      243.6        6.0        (46.5 ) 

Non-controlling interests

      (6.9 )      (8.7 )      (27.1 )      (0.9 )      (26.2 )      (21.6 )      (18.1 ) 
                                                        

Profit/(loss) for the period attributable to equity shareholders

    $ 0.8      $ 76.0      $ 2.2      $ (271.1 )      217.4      $ (15.6 )    $ (64.6 ) 
                                                        

 

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     Successor     Predecessor     Pro Forma     Successor     Predecessor  
     Q1 2011     Q1 2010     Fiscal     Q4 2010     9M 2010     Fiscal Year  
$ in millions        2010         2009     2008  

Selected operating segment data:

                     

Sales:

                     

Industrial & Automotive:

                     

Power Transmission

    $ 592.7      $ 519.2      $ 2,136.7      $ 580.8      $ 1,555.9      $ 1,763.4      $ 2,125.2   

Fluid Power

      234.6        180.3        784.5        215.4        569.1        588.7        832.3   

Sensors & Valves

      120.8        99.7        402.2        107.9        294.3        313.6        421.0   

Other I&A

      159.5        136.3        548.8        131.3        417.5        463.4        602.1   
                                                        

Total Industrial & Automotive

    $ 1,107.6      $ 935.5      $ 3,872.2      $ 1,035.4      $ 2,836.8      $ 3,129.1      $ 3,980.6   
                                                        

Building Products:

                     

Air Distribution

    $ 207.3      $ 197.4      $ 862.9      $ 226.7      $ 636.2      $ 874.2      $ 1,112.3   

Bathware

      28.0        33.0        118.8        27.1        91.7        140.3        208.2   
                                                        

Total Building Products

    $ 235.3      $ 230.4      $ 981.7      $ 253.8      $ 727.9      $ 1,014.5      $ 1,320.5   
                                                        

Ongoing segments

    $ 1,342.9      $ 1,165.9      $ 4,853.9      $ 1,289.2      $ 3,564.7      $ 4,143.6      $ 5,301.1   

Exited segments (1)

      —          —          —          —          —          36.5        214.8   
                                                        

Continuing operations

    $ 1,342.9      $ 1,165.9      $ 4,853.9      $ 1,289.2      $ 3,564.7      $ 4,180.1      $ 5,515.9   
                                                        

Adjusted EBITDA (2):

                     

Industrial & Automotive:

                     

Power Transmission

    $ 130.1      $ 110.6      $ 433.5      $ 115.2      $ 318.2      $ 295.8      $ 333.0   

Fluid Power

      40.3        27.0        101.0        27.6        73.2        18.8        79.3   

Sensors & Valves

      23.5        15.2        61.9        17.4        44.5        25.6        56.5   

Other I&A

      14.8        10.8        71.1        15.9        55.2        41.6        61.9   
                                                        

Total Industrial & Automotive

    $ 208.7      $ 163.6      $ 667.5      $ 176.1      $ 491.1      $ 381.8      $ 530.7   
                                                        

Building Products:

                     

Air Distribution

    $ 21.8      $ 23.9      $ 103.5      $ 22.6      $ 80.5      $ 105.6      $ 132.7   

Bathware

      (0.6 )        (0.1 )        (2.9 )        (1.2 )        (1.7 )      (0.1 )      (2.1 ) 
                                                        

Total Building Products

    $ 21.2      $ 23.8      $ 100.6      $ 21.4      $ 78.8      $ 105.5      $ 130.6   

Corporate

      (16.4 )      (12.9 )      (34.3 )      (6.1 )      (25.8 )      (26.7 )      (27.8 ) 
                                                        

Total ongoing segments

    $ 213.5      $ 174.5      $ 733.8      $ 191.4      $ 544.1      $ 460.6      $ 633.5   

Exited segments (1)

      (0.3 )      (0.5 )      (0.9 )      (0.2 )      (0.7 )      (12.9 )      (0.1 ) 
                                                        

Continuing operations

    $ 213.2      $ 174.0      $ 732.9      $ 191.2      $ 543.4      $ 447.7      $ 633.4   
                                                        

Selected cash flow data:

                     

Net cash inflow/(outflow) from operating activities

    $ 36.1      $ (42.1 )        $ 45.4      $ 194.7      $ 513.0      $ 544.2   

Net cash outflow from investing activities

      (25.6 )      (54.4 )          (4,098.8 )      (103.0 )      (135.3 )      (124.0 ) 

Net cash (outflow)/inflow from financing activities

      (142.1 )      (58.9 )          4,551.2        (42.1 )      (220.5 )      (401.0 ) 

 

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     Successor     Predecessor  
     As of                
($ in millions)    April 2,
2011		     December 31,
2010		     January 2,
2010		  

Selected balance sheet data:

         

Cash and cash equivalents

    $ 327.4      $ 459.3      $ 445.0   

Property, plant and equipment

      1,352.6        1,359.1        1,122.8   

Total assets

      7,636.5        7,552.3        3,673.6   

Total debt (3)

      (3,140.5 )      (3,165.0 )        (707.9 ) 

 

     Successor     Predecessor           Pro Forma            Successor     Historical  
     Q1 2011     Q1 2010           Fiscal            Q4 2010     9M2010     Fiscal Year  
$ in millions          2010                2009     2008  

Selected financial data:

                            

Ongoing segments

                            

Sales

    $ 1,342.9      $ 1,165.9          $ 4,853.9           $ 1,289.2      $ 3,564.7      $ 4,143.6      $ 5,301.1   

Adjusted EBITDA (2)

      213.5        174.5            733.8             191.4        544.1        460.6        633.5   

Adjusted EBITDA Margin (2)

      15.9 %      15.0 %          15.1 %           14.8 %      15.3 %      11.1 %      12.0 % 

Capital expenditure

    $ (32.1 )      $ (25.6 )        $ (155.9 )         $ (60.2 )      $ (95.7 )    $ (122.9 )    $ (189.9 ) 

Trading cash flow (2)

      35.2        (40.6 )          152.9             8.8        144.1        422.0        442.8   

Net debt at period end (2)

      (2,981.7 )      (327.6 )          (2,865.0 )           (2,865.0 )      (138.1 )      (211.4 )      (479.9 ) 

Cash interest (4)

                243.6                  

Adjusted EBITDA to cash interest (4)

                3.01x                  

First lien debt (5) to Adjusted EBITDA

                2.69x                  

Total principal debt (6) to Adjusted EBITDA

                4.59x                  

 

(1) During the periods under review, we reported two exited segments: within Industrial & Automotive, the Stant and Standard-Thomson businesses that were sold during Fiscal 2008 (“Caps & Thermostats”); and within Building Products, the Philips Doors & Windows business that was closed during Fiscal 2009 (“Doors & Windows”).
(2) See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Measures.”
(3) Total debt comprises bank overdrafts, bank and other loans and obligations under finance leases as reported in our consolidated balance sheet. As at April 2, 2011 and December 31, 2010, bank and other loans included amounts outstanding under our senior secured credit facilities and the exchange notes offered hereby.
(4) Cash interest represents interest paid during the period as would be reported in our consolidated cash flow statement.
(5) Represents the senior secured credit facilities as set forth on the table presented in “Capitalization.”
(6) See “Capitalization.”

 

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RISK FACTORS

Investing in the exchange notes involves substantial risks. In evaluating whether to participate in the exchange offer, you should carefully consider, along with the other information provided to you in this prospectus, these risk factors. Additional risks and uncertainties not presently known to us, or that we currently believe are immaterial, could also impair our business, financial condition, results of operations and our ability to fulfill our obligations under the notes. Unless otherwise indicated, the risk factors set forth below generally apply to all our notes.

This prospectus also contains forward-looking statements that involve risks and uncertainties and the cautionary statement regarding the forward-looking statements set forth under the caption “Disclosure Regarding Forward-Looking Statements.” Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including the risks described below and elsewhere in this prospectus.

Risks Relating to the Exchange Offer

If you fail to follow the exchange offer procedures, your initial notes will not be accepted for exchange.

We will not accept your initial notes for exchange if you do not follow the exchange offer procedures. We will issue exchange notes as part of this exchange offer only after timely receipt of your initial notes, a properly completed and duly executed letter of transmittal and all other required documents or if you comply with the guaranteed delivery procedures for tendering your initial notes. Therefore, if you want to tender your initial notes, please allow sufficient time to ensure timely delivery. If we do not receive your initial notes, letter of transmittal, and all other required documents by the expiration date of the exchange offer, or you do not otherwise comply with the guaranteed delivery procedures for tendering your initial notes, we will not accept your initial notes for exchange. Neither we nor the exchange agent is required to give notification of defects or irregularities with respect to the tenders of initial notes for exchange. If there are defects or irregularities with respect to your tender of initial notes, we will not accept your initial notes for exchange unless we decide in our sole discretion to waive such defects or irregularities.

If you choose not to exchange your initial notes in the exchange offer, the transfer restrictions currently applicable to your initial notes will remain in force and the market price of your initial notes may decline.

If you do not exchange your initial notes for exchange notes representing the same underlying indebtedness in the exchange offer, then you will continue to be subject to the transfer restrictions on the initial notes as set forth in the notes and the indenture that governs the notes. In general, the initial notes may not be offered or sold unless they are registered or exempt from registration under the Securities Act and applicable state securities laws. Except as required by the registration right agreements, we do not intend to register resales of the initial notes under the Securities Act. You should refer to “Summary — The Exchange Offer,” and “The Exchange Offer — Procedures for Tendering Initial Notes” for information about how to tender your initial notes.

The tender of initial notes under the exchange offer will reduce the principal amount of the initial notes outstanding, which may have an adverse effect upon and increase the volatility and market price of the initial notes due to reduction in liquidity.

Lack of an active market for the exchange notes may adversely affect the liquidity and market price of the exchange notes.

There is no existing market for the exchange notes. We do not intend to apply for a listing of the exchange notes on any securities exchange. We do not know if an active public market for the exchange notes will develop or, if developed, will continue. If an active public market does not develop or is not maintained, the market price and liquidity of the exchange notes may be adversely affected. We cannot make any assurances regarding the liquidity of the market for the exchange notes, the ability of holders to sell their exchange notes or the price at which holders may sell their exchange notes. Further, the liquidity and the market price of the exchange notes may be adversely

 

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affected by changes in the overall market for securities similar to the exchange notes, by changes in our business, financial condition or results of operations and by changes in conditions in our industry. In addition, if a large amount of initial notes are not tendered or are tendered improperly, the limited amount of exchange notes that would be issued and outstanding after we consummate the exchange offer could lower the market price of such exchange notes.

The market price for the exchange notes may be volatile.

Historically, the market for non-investment grade debt has been subject to disruptions that have caused substantial volatility in the prices of securities similar to the exchange notes offered hereby. The market for the exchange notes, if any, may be subject to similar disruptions and any such disruptions may adversely affect the prices at which you may sell your exchange notes. In addition, once issued, the exchange notes may trade at a discount from their initial offering price, depending upon prevailing interest rates, the market for similar notes, our performance and other factors.

The issuance of the exchange notes may adversely affect the market for the initial notes.

To the extent the initial notes are tendered and accepted in the exchange offer, the trading market for the untendered and tendered but unaccepted initial notes could be adversely affected. Because we anticipate that most holders of the initial notes will elect to exchange their initial notes for exchange notes due to the absence of restrictions on the resale of exchange notes under the Securities Act, we anticipate that the liquidity of the market for any initial notes remaining after the completion of this exchange offer may be substantially limited. Please refer to the section in this prospectus entitled “The Exchange Offer—Consequences of Failure to Exchange.”

Some persons who participate in the exchange offer must deliver a prospectus in connection with resales of the exchange notes.

Based on interpretations of the staff of the Commission contained in Exxon Capital Holdings Corp., SEC no-action letter (April 13, 1988), Morgan Stanley & Co. Inc., SEC no-action letter (June 5, 1991) and Shearman & Sterling, SEC no-action letter (July 2, 1983), we believe that you may offer for resale, resell or otherwise transfer the exchange notes without compliance with the registration and prospectus delivery requirements of the Securities Act. However, in some instances described in this prospectus under “Plan of Distribution,” you will remain obligated to comply with the registration and prospectus delivery requirements of the Securities Act to transfer your exchange notes. In these cases, if you transfer any exchange note without delivering a prospectus meeting the requirements of the Securities Act or without an exemption from registration of your exchange notes under the Securities Act, you may incur liability under this act. We do not and will not assume, or indemnify you against, this liability.

Risks Relating to the Notes

We have substantial indebtedness, which could affect our ability to meet our obligations under the notes and may otherwise restrict our activities

As of April 2, 2011, we had total principal debt outstanding of $3,359.0 million. We are permitted by the terms of the notes and our other debt instruments to incur substantial additional indebtedness, subject to the restrictions therein. Our inability to generate sufficient cash flow to satisfy our debt obligations, or to refinance our obligations on commercially reasonable terms, would have a material adverse effect on our business, financial condition and results of operations.

Our substantial indebtedness could have important consequences to you. For example, it could:

 

  •  

make it more difficult for us to satisfy our obligations under our indebtedness, including the notes;

 

  •  

limit our ability to borrow money for our working capital, capital expenditures, debt service requirements or other corporate purposes;

 

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  •  

require us to dedicate a substantial portion of our cash flow to payments on our indebtedness, which would reduce the amount of cash flow available to fund working capital, capital expenditures and other corporate requirements;

 

  •  

increase our vulnerability to general adverse economic and industry conditions;

 

  •  

limit our ability to respond to business opportunities; and

 

  •  

subject us to financial and other restrictive covenants, which, if we fail to comply with these covenants and our failure is not waived or cured, could result in an event of default under our debt.

We may not be able to generate sufficient cash to service all of our indebtedness, including the notes, and may be forced to take other actions to satisfy our obligations under our indebtedness that may not be successful.

Our ability to pay principal and interest on the notes and to satisfy our other debt obligations will depend upon, among other things:

 

  •  

our future financial and operating performance, which will be affected by prevailing economic conditions and financial, business, regulatory and other factors, many of which are beyond our control; and

 

  •  

the future availability of borrowings under our senior secured credit facilities, which depends on, among other things, our complying with the covenants in our senior secured credit facilities.

We cannot assure you that our business will generate sufficient cash flow from operations, or that future borrowings will be available to us under our senior secured credit facilities or otherwise, in an amount sufficient to fund our liquidity needs, including the payment of principal and interest on the notes. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

If our cash flows and capital resources are insufficient to service our indebtedness, we may be forced to reduce or delay capital expenditures, sell assets, seek additional capital or restructure or refinance our indebtedness, including the notes. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations. Our ability to restructure or refinance our debt will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. In addition, the terms of existing or future debt agreements, including our senior secured credit facilities and the indenture governing the notes, may restrict us from adopting some of these alternatives. In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. We may not be able to consummate those dispositions for fair market value or at all. Furthermore, any proceeds that we could realize from any such dispositions may not be adequate to meet our debt service obligations then due. Furthermore, the Sponsors have no continuing obligation to provide us with debt or equity financing.

The issuers are wholly owned financing subsidiaries of Holdings with no operations of their own and they are dependent upon payments under the intercompany loans from other subsidiaries of Holdings to meet their obligations under the notes.

The issuers are financing entities wholly owned by Holdings with limited assets and no business operations other than operations related to issuing and servicing the notes and engaging in related transactions. Upon the consummation of the initial notes offering, the issuers on-lent the proceeds from the notes issuance to other subsidiaries of Holdings through intercompany loans. The issuers’ ability to make payments on the notes is dependent directly on payments to the issuers under these intercompany loans. The ability of the obligors to make payments to the issuers under these intercompany loans will depend on a number of factors, some of which may be beyond our control. For example, if the obligors fail to generate or fail to have access to sufficient cash to make scheduled payments to the issuers under the intercompany loans, the issuers may not have any other source of funds to meet their payment obligations under the notes.

 

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The notes will be structurally subordinated to all liabilities of the non-guarantor subsidiaries of Holdings.

The notes will be structurally subordinated to the indebtedness and other liabilities of the current and future subsidiaries of Holdings that do not guarantee the notes. The non-guarantor subsidiaries and any future non-guarantor subsidiaries are separate and distinct legal entities and have no obligation, contingent or otherwise, to pay any amounts due pursuant to the notes, or to make any funds available therefore, whether by dividends, loans, distribution or other payments. The non-guarantor subsidiaries accounted for the following proportion of our ongoing operations: (i) 41% of pro forma sales in Fiscal 2010 and of sales in Q1 2011; (ii) 47% of pro forma Adjusted EBITDA in Fiscal 2010 and 49% of Adjusted EBITDA in Q1 2011; (iii) 45% of total assets at the end of Fiscal 2010 and at the end of Q1 2011; and (iv) 14% of total liabilities at the end of Fiscal 2010 and at the end of Q1 2011. Both (i) and (ii) are calculated excluding corporate center entities. In the event that Rule 3-10 of Regulation S-X under the Securities Act would require separate financial statements of any subsidiary that is a Guarantor to be filed with the SEC solely because such subsidiary’s guarantee is not a full and unconditional guarantee as reasonably determined by Holdings such guarantee will be automatically discharged and release. In the case of such discharge and release, the notes would no longer be guaranteed by such entity even though the guarantee by such entity of our senior secured credit facilities would continue. Substantially all, but not all, of our foreign entities that guarantee the senior secured credit facilities are expected to guarantee the notes. Any right that we or the Guarantors have to receive any assets of the non-guarantor subsidiaries and any future non-guarantor subsidiaries upon the liquidation or reorganization of those subsidiaries, and the consequent rights of holders of notes to realize proceeds from the sale of any of those subsidiaries’ assets, will be structurally subordinated to the claims of those subsidiaries’ creditors, including trade creditors and holders of preferred equity interests of those subsidiaries. Accordingly, in the event of a bankruptcy, liquidation or reorganization of any non-guarantor subsidiaries and any future non-guarantor subsidiaries, such non-guarantor subsidiaries will pay the holders of their debts, holders of preferred equity interests and their trade creditors before they will be able to distribute any of their assets to us.

The terms of our senior secured credit facilities and the indenture governing the notes may restrict our current and future operations, particularly our ability to respond to changes in our business or to take certain actions.

The credit agreement governing our senior secured credit facilities and the indenture governing the notes contain, and any future indebtedness of ours would likely contain, a number of restrictive covenants that will impose significant operating and financial restrictions on us, including restrictions on our ability to, among other things:

 

  •  

incur or guarantee additional debt;

 

  •  

issue qualified stock and preferred stock;

 

  •  

pay dividends and make other restricted payments;

 

  •  

create or incur certain liens;

 

  •  

make certain investments;

 

  •  

engage in sales of assets and subsidiary stock;

 

  •  

enter into transactions with affiliates;

 

  •  

transfer all or substantially all of our assets or enter into merger or consolidation transactions; and

 

  •  

make capital expenditures.

In addition, our senior secured credit facilities require us to maintain certain financial ratios. As a result of these covenants, we will be limited in the manner in which we conduct our business, and we may be unable to

 

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engage in favorable business activities or finance future operations or capital needs. Our ability to meet those financial ratios can be affected by events beyond our control, and there can be no assurance that we will meet those ratios. An adverse development affecting our business could require us to seek waivers or amendments of covenants, alternative or additional sources of financing or reductions in expenditures. We cannot assure you that such waivers, amendments or alternative or additional financings could be obtained or, if obtained, would be on terms acceptable to us.

A failure to comply with the covenants contained in our senior secured credit facilities or the indenture governing the notes could result in an event of default under our senior secured credit facilities or the indenture governing the notes, which, if not cured or waived, could have a material adverse affect on our business, financial condition and results of operations. In the event of any default under our senior secured credit facilities or the indenture governing the notes, the lenders thereunder:

 

  •  

will not be required to lend any additional amounts to us;

 

  •  

could elect to declare all borrowings outstanding, together with accrued and unpaid interest and fees, to be due and payable;

 

  •  

may have the ability to require us to apply all of our available cash to repay these borrowings; or

 

  •  

may prevent us from making debt service payments under our other agreements, any of which could result in an event of default under the notes.

Such actions by lenders under our senior secured credit facilities could cause cross defaults under our other indebtedness, including the indenture governing the notes.

We have pledged and will pledge substantially all of our assets as collateral under our senior secured credit facilities and the indenture governing the notes subject to certain exceptions. If any of the holders of our indebtedness accelerate the repayment of such indebtedness, there can be no assurance that we will have sufficient assets to repay our indebtedness. If we were unable to repay those amounts, the holders of our secured indebtedness could proceed against the collateral granted to them to secure that indebtedness. See “Description of Certain Indebtedness” and “Description of Senior Secured Second Lien Notes.”

The collateral securing our obligations under the notes and the guarantees is shared with other creditors. If there is a default, the value of the collateral may not be sufficient to repay the first priority lien creditors and the holders of the notes and guarantees. The collateral securing the notes may be divided under certain circumstances.

Our obligations under the notes and the guarantees related thereto will be secured by a second priority lien on all of the collateral securing our obligations under our senior secured credit facilities (subject to certain exceptions described in “—The capital stock securing the notes will in certain circumstances be released automatically from the respective liens and no longer be deemed to be collateral to the extent the pledge of such capital stock would require the filing of separate financial statements for any of our subsidiaries with the SEC,” and excluding certain assets as described in “Description of Senior Secured Second Lien Notes”) on a second priority basis. The relative priority of the liens on the collateral will be governed by an intercreditor agreement. Accordingly, any proceeds received upon a realization of the collateral securing our senior secured credit facilities on a first priority basis will first be applied to the costs and expenses incurred with such realization and second to obligations (including expenses and other amounts) under our senior secured credit facilities, before any amounts will be available to pay the holders of notes. See “Description of Senior Secured Second Lien Notes—Security for the Notes” and “Description of Senior Secured Second Lien Notes—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock.” The value of the collateral and the amount to be received upon a sale of such collateral will depend upon many factors including, among others, the ability to sell the collateral in an orderly sale, the condition of the economies in which our operations are located, the availability of buyers and other factors. The book value of the collateral should not be relied on as a measure of realizable value for such assets. Portions of the collateral may be illiquid and may have no readily ascertainable market value. The

 

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collateral is located in a number of countries, and the multi-jurisdictional nature of any foreclosure on the collateral may limit the realizable value of the collateral. To the extent that holders of other secured debt or third parties enjoy liens (including statutory liens), whether or not permitted by the indenture, such holders or third parties may have rights and remedies with respect to the collateral securing the notes and the guarantees that, if exercised, could reduce the proceeds available to satisfy the obligations under the notes and the guarantees. As a result, if there is a default, the value of the collateral may not be sufficient to repay our senior secured credit facilities and the holders of the notes.

The value of the collateral securing the notes may not be sufficient to secure post-petition interest. Should our obligations under the notes equal or exceed the fair market value of the collateral securing the notes, the holders of the notes may be deemed to have an unsecured claim.

In the event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding against the issuers or the Guarantors, holders of the notes will be entitled to post-petition interest under the U.S. Bankruptcy Code only if the value of their security interest in the collateral is greater than their pre-bankruptcy claim. Holders of the notes may be deemed to have an unsecured claim if the issuers’ obligation under the notes equals or exceeds the fair market value of the collateral securing the notes. Holders of the notes that have a security interest in the collateral with a value equal to or less than their pre-bankruptcy claim will not be entitled to post-petition interest under the U.S. Bankruptcy Code. The bankruptcy trustee, the debtor-in-possession or competing creditors could possibly assert that the fair market value of the collateral with respect to the notes on the date of the bankruptcy filing was less than the then-current principal amount of the notes. Upon a finding by a bankruptcy court that the notes are under-collateralized, the claims in the bankruptcy proceeding with respect to the notes would be bifurcated between a secured claim and an unsecured claim, and the unsecured claim would not be entitled to the benefits of security in the collateral. Other consequences of a finding of under-collateralization would be, among other things, a lack of entitlement on the part of holders of the notes to receive post-petition interest and a lack of entitlement on the part of the unsecured portion of the notes to receive other “adequate protection” under U.S. federal bankruptcy laws. In addition, if any payments of post-petition interest were made at the time of such a finding of under-collateralization, such payments could be re-characterized by the bankruptcy court as a reduction of the principal amount of the secured claim with respect to notes. No appraisal of the fair market value of the collateral securing the notes has been prepared in connection with this offering of the notes and, therefore, the value of the collateral trustees’ interests in the collateral may not equal or exceed the principal amount of the notes. We cannot assure you that there will be sufficient collateral to satisfy our and the Guarantors’ obligations under the notes.

The right of holders of notes to exercise remedies with respect to the collateral is extremely limited, even during an event of default under the indenture governing the notes.

The rights of the holders of notes with respect to the collateral are extremely limited, even during an event of default under the indenture governing the notes. If first priority obligations are outstanding, any actions that may be taken in respect of any of the collateral securing the notes, including the ability to cause the commencement of enforcement proceedings against the collateral and to control the conduct of such proceedings, are controlled and directed by holders of our first lien debt. In those circumstances, the notes collateral agent, on behalf of the itself, the trustee and the holders of the notes, will not have the ability to control or direct such actions, even if an event of default under the indenture governing the notes has occurred or if the rights of the trustee, the notes collateral agent and the holders of the notes are or may be adversely affected. The administrative agent and the lenders under our senior secured credit facilities are under no obligation to take into account the interests of the trustee under the indenture governing the notes, the collateral agent and the holders of the notes when determining whether and how to exercise their rights with respect to the collateral securing our senior secured credit facilities on a first priority basis, subject to the applicable intercreditor agreements, and their interests and rights may be significantly different from or adverse to yours. To the extent that collateral is released from the first priority liens, subject to certain conditions the second priority liens securing the notes and the guarantees related thereto will also automatically be released without any noteholder consent or notice to the collateral agent, except that such release of liens does not apply with respect to the release of collateral in connection with the full payment of our obligations under our senior secured credit facilities or a refinancing of our obligations thereunder. See “Description of Senior Secured Second Lien Notes—Security for the Notes— Second Lien Intercreditor Agreement” and “Description of Second Lien Notes—Security for the Notes—Release of Collateral.”

 

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In the event of our bankruptcy, the ability of the holders of the notes to realize upon the collateral will be subject to certain bankruptcy law limitations.

The ability of holders of the notes to realize upon the collateral will be subject to certain bankruptcy law limitations in the event of our bankruptcy. Under federal bankruptcy law, secured creditors are prohibited from repossessing their security from a debtor in a bankruptcy case, or from disposing of security repossessed from such a debtor, without bankruptcy court approval, which may not be given. Moreover, applicable federal bankruptcy laws generally permit the debtor to continue to use and expend collateral, including cash collateral, and to provide liens senior to the collateral trustees for the notes’ liens to secure indebtedness incurred after the commencement of a bankruptcy case, provided that the secured creditor either consents or is given “adequate protection.” “Adequate protection” could include cash payments or the granting of additional security, if and at such times as the presiding court in its discretion determines, for any diminution in the value of the collateral as a result of the stay of repossession or disposition of the collateral during the pendency of the bankruptcy case, the use of collateral (including cash collateral) and the incurrence of such senior indebtedness. In view of the broad discretionary powers of a bankruptcy court, it is impossible to predict how long payments under the notes could be delayed following commencement of a bankruptcy case, whether or when the collateral trustees would repossess or dispose of the collateral, or whether or to what extent holders of the notes would be compensated for any delay in payment of loss of value of the collateral through the requirements of “adequate protection.” Furthermore, in the event the bankruptcy court determines that the value of the collateral is not sufficient to repay all amounts due on the notes, our first priority credit facility and any other first lien or pari passu debt secured by the common collateral, the indebtedness under the notes would be “undersecured” and the holders of the notes would have unsecured claims as to the difference. Federal bankruptcy laws do not permit the payment or accrual of interest, costs, and attorneys’ fees on undersecured indebtedness during the debtor’s bankruptcy case.

Your rights in the collateral may be adversely affected by the failure to perfect security interests in collateral.

Applicable law provides that a security interest in certain tangible and intangible assets can only be properly perfected and its priority retained through certain actions undertaken by the secured party. The liens in the collateral securing the notes may not be perfected with respect to the claims of the notes if the collateral agent relating to such notes is not able to take the actions necessary to perfect any of these liens on or about the date of the indenture governing such notes. In addition, applicable law provides that certain property and rights acquired after the grant of a general security interest, such as real property, equipment subject to a certificate of title and certain proceeds, can only be perfected at or after the time such property and rights are acquired and identified. We and our Guarantors have limited obligations to perfect the noteholders’ security interest in specified collateral. There can be no assurance that the collateral agent for the notes will monitor, or that we will inform the trustee of, the future acquisition of property and rights that constitute collateral, and that the necessary action will be taken to properly perfect the security interest in such after-acquired collateral. The collateral agent for the notes have no obligation to monitor the acquisition of additional property or rights that constitute collateral or the perfection of any security interest. Such failure may result in the loss of the security interest in the collateral or the priority of the security interest in favor of the notes against third parties.

The capital stock securing the notes will in certain circumstances be released automatically from the respective liens and no longer be deemed to be collateral to the extent the pledge of such capital stock would require the filing of separate financial statements for any of our subsidiaries with the SEC.

The indenture governing the notes and the security documents provide that, in the event that Rule 3-16 of Regulation S-X under the Securities Act (or any successor regulation) requires the filing with the SEC of separate financial statements of any of our subsidiaries the capital stock of which is pledged as collateral securing the notes, the portion (or, if necessary, all) of such capital stock necessary to eliminate such filing requirement will automatically be deemed released and not to have been part of the collateral securing the notes. In such event, we and the trustee will amend or modify the security documents without the consent of any holder of the notes to the extent necessary to evidence such release. As a result, holders of the notes could lose all or a portion of their security interest in the capital stock. The capital stock pledged as collateral under the senior secured credit facilities is not subject to a similar provision and any capital stock pledged as collateral under any of our future indebtedness may not be subject to a similar provision.

 

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The Rule 3-16 requirement to file with the SEC separate financial statements of a subsidiary is triggered if the aggregate principal amount, par value, or book value of the capital stock as carried by the registrant, or the market value of such capital stock, whichever is greatest, equals 20 percent or more of the principal amount of the notes. Any pledge of the capital stock of any of our subsidiaries is automatically released to the extent the value of the capital stock of any individual subsidiary subject to the pledge is in excess of 20 percent of the principal amount of the applicable notes. Any increase in value of the capital stock of our subsidiaries may lead to further releases of capital stock from the collateral securing the notes. Moreover, the realizable value of the capital stock in the event of a foreclosure may be significantly less than the management estimates of market value.

Corporate benefit, capital maintenance laws and other limitations on the guarantees and the security interests may adversely affect the validity and enforceability of the guarantees of the notes and the security interests.

The laws of certain of the jurisdictions in which the Guarantors are organized limit the ability of these subsidiaries to guarantee debt of a related company or grant security on account of a related company’s debts. These limitations arise under various provisions or principles of corporate law which include rules governing capital maintenance, under which, among others, the risks associated with a guarantee or grant of security on account of a parent company’s debt need to be reasonable and economically and operationally justified from the Guarantor’s or grantor’s perspective, as well as thin capitalization and fraudulent transfer principles. If these limitations were not observed, the guarantees and the grant of security interests by these Guarantors could be subject to legal challenge. In these jurisdictions, the guarantees will contain language limiting the amount of debt guaranteed so that applicable local law restrictions will not be violated. Certain of the security documents will contain similar limitations. Accordingly if you were to enforce the guarantees by a Guarantor in one of these jurisdictions or seek to enforce a security interest in collateral granted by a Guarantor in one of these jurisdictions, your claims are likely to be limited. In some cases, where the amount that can be guaranteed or secured is limited by reference to the net assets and legal capital of the Guarantor or by reference to the outstanding debt owed by the relevant Guarantor to an issuer under intercompany loans that amount might have reached zero or close to zero at the time of any insolvency or enforcement. Furthermore, although we believe that the guarantees by these Guarantors and the security interests granted by these Guarantors will be validly given in accordance with local law restrictions, there can be no assurance that a third-party creditor would not challenge these guarantees and security interests and prevail in court.

The security interests over the collateral is granted to the collateral agent rather than directly to the holders of the notes. The ability of the collateral agent to enforce the collateral may be restricted by local law.

In certain jurisdictions, including Germany and The Netherlands, the security over the collateral that (if and when granted) will constitute security for the obligations of the issuers under the notes and the indenture governing the notes will not be granted directly to the noteholders but only in favor of the collateral agent, as beneficiary of parallel debt or analogous obligations (the “Parallel Debt”). This Parallel Debt is created to satisfy a requirement under the applicable laws that the collateral agent, as grantee of certain types of collateral, be a creditor of the relevant security provider. The Parallel Debt is in the same amount and payable at the same time as the obligations of the issuers under the indenture governing the notes and the notes (the “Principal Obligations”). Any payment in respect of the Principal Obligations shall discharge the corresponding Parallel Debt and any payment in respect of the Parallel Debt shall discharge the corresponding Principal Obligations. Although the collateral agent will have, pursuant to the Parallel Debt, a claim against the issuers for the full principal amount of the notes, noteholders bear some risks associated with a possible insolvency or bankruptcy of the collateral agent. The Parallel Debt obligations referred to above are contained in the indenture governing the notes, which are governed by New York law. There is no assurance that such a structure will be effective before applicable courts as there is no judicial or other guidance as to its efficacy, and therefore the ability of the collateral agent to enforce the collateral may be restricted.

The granting of the security interests in the collateral in connection with the issuance of the notes may create hardening periods for such security interests in accordance with the law applicable in certain jurisdictions.

The granting of new security interests in the collateral in connection with the notes may create hardening periods for such security interests in certain jurisdictions. The applicable hardening period for these new security interests will run as from the moment each new security interest has been granted or perfected. At each time, if the security interest granted or recreated were to be enforced before the end of the respective hardening period applicable in such jurisdiction, it may be declared void and/or it may not be possible to enforce it.

 

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Federal and state statutes allow courts, under specific circumstances, to void notes and guarantees and require holders of the notes to return payments received.

If we or any Guarantor becomes a debtor in a case under the U.S. Bankruptcy Code or encounter other financial difficulty, under federal or state fraudulent transfer law, a court may void, subordinate or otherwise decline to enforce the notes or the guarantees. A court might do so if it found that when we issued the notes or the Guarantor entered into its guarantee, or in some states when payments became due under the notes or the guarantees, we or the Guarantor received less than reasonably equivalent value or fair consideration and either:

 

  •  

was insolvent or rendered insolvent by reason of such incurrence; or

 

  •  

was left with inadequate capital to conduct its business; or

 

  •  

believed or reasonably should have believed that it would incur debts beyond its ability to pay.

The court might also void an issuance of notes or a guarantee without regard to the above factors, if the court found that we issued the notes or the applicable Guarantor entered into its guarantee with actual intent to hinder, delay or defraud its creditors.

A court would likely find that we or a Guarantor did not receive reasonably equivalent value or fair consideration for the notes or its guarantee, if we or a Guarantor did not substantially benefit directly or indirectly from the issuance of the notes. If a court were to void the issuance of the notes or guarantees you would no longer have any claim against us or the applicable Guarantor. Sufficient funds to repay the notes may not be available from other sources, including the remaining obligors, if any. In addition, the court might direct you to repay any amounts that you already received from us or a Guarantor.

The measures of insolvency for purposes of these fraudulent transfer laws will vary depending upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred. Generally, however, a Guarantor would be considered insolvent if:

 

  •  

the sum of its debts, including contingent liabilities, was greater than the fair saleable value of all of its assets; or

 

  •  

if the present fair saleable value of its assets was less than the amount that would be required to pay its probable liability on its existing debts, including contingent liabilities, as they become absolute and mature; or

 

  •  

it could not pay its debts as they become due.

On the basis of historical financial information, recent operating history and other factors, we believe that each Guarantor, after giving effect to its guarantee of the notes, will not be insolvent, will not have unreasonably small capital for the business in which it is engaged and will not have incurred debts beyond its ability to pay such debts as they mature. We cannot assure you, however, as to what standard a court would apply in making these determinations or that a court would agree with our conclusions in this regard.

Local insolvency laws may not be as favorable to you as U.S. bankruptcy laws or those of another jurisdiction with which you are familiar.

Certain of the Guarantors are incorporated in one of the United Kingdom, Australia, Belgium, Brazil, The British Virgin Islands, Canada, Germany, Luxembourg, Mexico, The Netherlands, Northern Ireland, Mauritius, Russia, Turkey or the United Arab Emirates. The insolvency laws of these jurisdictions may not be as favorable to your interests as the laws of the United States or other jurisdictions with which you are familiar. In the event that any one or more of the Company, the Guarantors or any other of the Company’s subsidiaries experienced financial difficulty, it is not possible to predict with certainty in which jurisdiction or jurisdictions insolvency or similar proceedings would be commenced, or the outcome of such proceedings.

 

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Insolvency laws and other limitations on the guarantees and the security interests, including fraudulent conveyance statutes, may adversely affect their validity and enforceability and enforcing your rights as a noteholder or under the guarantees across multiple jurisdictions may prove difficult.

Our obligations under the notes will be guaranteed by the Guarantors and secured by security interests over the collateral. The Guarantors are organized under the laws of the United States, the United Kingdom, Australia, Belgium, Brazil, The British Virgin Islands, Canada, Germany, Luxembourg, Mexico, The Netherlands, Northern Ireland, Mauritius, Russia, Turkey or the United Arab Emirates. Although laws differ among these jurisdictions, in general, applicable fraudulent transfer and conveyance and equitable principles, insolvency laws and, in the case of the guarantees and the security interests, limitations on the enforceability of judgments obtained in courts in such jurisdictions could limit the enforceability of the guarantee against a Guarantor and the enforceability of the security interests. The court may also in certain circumstances avoid the security interest or the guarantee where the company is close to or in the vicinity of insolvency. The following discussion of fraudulent transfer, conveyance and insolvency law, although an overview, describes generally applicable terms and principles, which are defined under the relevant jurisdiction’s fraudulent transfer and insolvency statutes.

In an insolvency proceeding, it is possible that creditors of the Guarantors or the appointed insolvency administrator may challenge the guarantees and the security interests, and intercompany obligations generally, as fraudulent transfers or conveyances, preferences or transactions at an undervalue or on other grounds. If so, such laws may permit a court, if it makes certain findings, to:

 

  •  

avoid or invalidate all or a portion of a Guarantor’s obligations under its guarantee or the security interests;

 

  •  

direct that holders of the notes return any amounts paid under a guarantee or any security to the relevant Guarantor or to a fund for the benefit of the Guarantor’s creditors; and

 

  •  

take other action that is detrimental to you.

If we cannot satisfy our obligations under the notes and any guarantee or security interest is found to be a fraudulent transfer or conveyance or is otherwise set aside, we cannot assure you that we can ever repay in full any amounts outstanding under the notes. In addition, the liability of each Guarantor under its guarantee or the security interests will be limited to the amount that will result in such guarantee or security interests not constituting a fraudulent conveyance or improper corporate distribution or otherwise being set aside. The amount recoverable from the Guarantors under the security documents will also be limited. However, there can be no assurance as to what standard a court would apply in making a determination of the maximum liability of each. Also, there is a possibility that the entire guarantee or security interests may be set aside, in which case, the entire liability may be extinguished.

In order to initiate any of these actions under fraudulent transfer or other applicable principles, courts would need to find that, at the time the guarantees were issued or the security interests created, the Guarantor:

 

  •  

issued such guarantee or created such security interest with the intent of hindering, delaying or defrauding current or future creditors or with a desire to prefer some creditors over others, or created such security after its insolvency;

 

  •  

issued such guarantee or created such security interest in a situation where a prudent businessman as a shareholder of such Guarantor would have contributed equity to such Guarantor;

 

  •  

did not issue such guarantee or create such security interest in good faith or in the best interests of such Guarantor; or

 

  •  

received less than reasonably equivalent value for incurring the debt represented by the guarantee or security interest on the basis that the guarantee or security interest were incurred for our benefit, and only indirectly the Guarantor’s benefit, or some other basis and (1) was insolvent or rendered insolvent

 

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by reason of the issuance of the guarantee or the creation of the security interest, or subsequently became insolvent for other reasons; (2) was engaged, or about to engage, in a business transaction for which the Guarantor’s assets were unreasonably small; or (3) intended to incur, or believed it would incur, debts beyond its ability to make required payments as and when they would become due.

Different jurisdictions evaluate insolvency on various criteria, but a Guarantor generally may, in different jurisdictions, be considered insolvent at the time it issued a guarantee or created any security interest if:

 

  •  

its liabilities exceed the fair market value of its assets;

 

  •  

it cannot pay its debts as and when they become due; and/or

 

  •  

the present saleable value of its assets is less than the amount required to pay its total existing debts and liabilities, including contingent and prospective liabilities, as they mature or become absolute.

Although we believe that we are solvent, there can be no assurance which standard a court would apply in determining whether a Guarantor was “insolvent” as of the date the guarantees were issued or the security interests were created or that, regardless of the method of valuation, a court would not determine that a Guarantor was insolvent on that date, or that a court would not determine, regardless of whether or not a Guarantor was insolvent on the date its guarantee was issued or security interests were created, that payments to holders of the notes constituted fraudulent transfers on other grounds.

Certain collateral is subject to potential environmental liabilities and the collateral agent may determine not to foreclose on it.

The notes will be secured in part by liens on real property that may be subject to both known and unforeseen environmental risks, and these risks may reduce or eliminate the value of the real property pledged as collateral for the notes. Moreover, the trustee and the collateral agent may need to evaluate the impact of potential environmental liabilities before determining to foreclose on the collateral consisting of real property because secured lenders that hold or enforce a security interest in real property may, under certain circumstances, be held liable under environmental laws for the costs of remediating or preventing the release or threatened release of regulated materials at or from such real property. Consequently, the collateral agent may decline to foreclose on such collateral or exercise remedies available in respect thereof if it does not receive indemnification to its satisfaction from the noteholders.

If we default on our obligations to pay our other indebtedness, we may not be able to make payments on the notes.

Any default under the agreements governing our indebtedness that is not waived by the required holders of such indebtedness, could leave us unable to pay principal, premium, if any, or interest on the notes and could substantially decrease the market value of the notes. If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds necessary to meet required payments of principal, premium, if any, or interest on such indebtedness, or if we otherwise fail to comply with the various covenants, including financial and operating covenants, in the instruments governing our indebtedness we could be in default under the terms of the agreements governing such indebtedness. In the event of such default, the holders of such indebtedness could elect to declare all the funds borrowed thereunder to be due and payable, together with any accrued and unpaid interest, the lenders under our first priority credit facility could elect to terminate their commitments, cease making further loans and institute foreclosure proceedings against the assets securing such facilities and we could be forced into bankruptcy or liquidation. If our operating performance declines, we may in the future need to seek waivers from the required lenders under our senior secured credit facilities to avoid being in default. If we breach our covenants under our senior secured credit facilities and seek waivers, we may not be able to obtain waivers from the required lenders thereunder.

 

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We may not be able to repurchase the notes upon a change of control.

Upon a change of control as defined in the indenture governing the notes, we will be required to make an offer to repurchase all outstanding notes at 101% of their principal amount plus accrued and unpaid interest, unless we have previously given notice of our intention to exercise our right to redeem the notes or unless such obligation is suspended. See “Description of Senior Secured Second Lien Notes—Change of Control.” We may not have sufficient financial resources to purchase all of the notes that are tendered upon a change of control offer or, if then permitted under the indenture governing the notes, to redeem the notes. A failure to make the applicable change of control offer or to pay the applicable change of control purchase price when due would result in a default under the indenture. The occurrence of a change of control would also constitute an event of default under our senior secured credit facilities and may constitute an event of default under the terms of our other indebtedness. The terms of the credit agreement governing our senior secured credit facilities and the indenture governing the notes limit our right to purchase or redeem certain indebtedness. In the event any purchase or redemption is prohibited, we may seek to obtain waivers from the required lenders under our senior secured credit facilities or holders of the notes to permit the required repurchase or redemption, but the required holders of such indebtedness have no obligation to grant, and may refuse to grant such a waiver. A change of control is defined in the indenture governing the notes. See “Description of Senior Secured Second Lien Notes—Change of Control.”

Certain private equity investment funds affiliated with the Sponsors own a significant majority of our equity and their interests may not be aligned with yours.

The Sponsors, certain of their affiliates and co-investors and certain members of management own 100% of the economic interests of Top Co-op, the direct parent of Holdings, and, therefore, will have the power to control all of our affairs and policies. The Sponsors will also control the election of directors, the appointment of management, the entering into mergers, sales of substantially all of our assets and other extraordinary transactions. The directors so elected will have authority, subject to the terms of our debt, to issue additional stock, implement stock repurchase programs, declare dividends and make other decisions. The interests of the Sponsors could conflict with your interests. For example, if we encounter financial difficulties or are unable to pay our debts as they mature, the interests of the Sponsors, as equity holders, might conflict with your interests as a noteholder. The Sponsors may also have an interest in pursuing acquisitions, divestitures, financings or other transactions that, in their judgment, could enhance their equity investments, even though such transactions might involve risks to you as a noteholder. Additionally, the Sponsors are in the business of making investments in companies, and may from time to time in the future acquire interests in businesses that directly or indirectly compete with certain portions of our business or are suppliers or customers of ours.

Risks Relating to Our Business

Conditions in the global economy and the major end markets we serve may materially and adversely affect the business and results of operations of our businesses should they deteriorate.

The business and operating results of our I&A and BP business groups have been, and will continue to be, affected by worldwide economic conditions, including conditions in the general industrial, automotive, non-residential and residential construction end markets we serve. As a result of continuing effects from the slowdown in global economic growth, the credit market crisis, declining consumer and business confidence, increased unemployment, reduced levels of capital expenditures, fluctuating commodity prices, bankruptcies and other challenges affecting the global economy, some of our customers may experience the deterioration of their businesses, cash flow shortages or difficulty obtaining financing. As a result, existing or potential customers may delay or cancel plans to purchase our products and services and may not be able to fulfill their obligations to us in a timely fashion.

Further, our vendors may be experiencing similar conditions, which may impact their ability to fulfill their obligations to us. If the global economic slowdown continues for a significant period or there is significant further deterioration in the global economy, our results of operations, financial position and cash flows could be materially adversely affected.

 

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Our strategy to expand our geographical reach may be impacted by economic, political and other risks associated with international operations, and this could adversely affect our business.

One of our key strategies is to expand our geographic reach, and as a result, a substantial portion of our operations are conducted and located outside the U.S. We have manufacturing, sales and service facilities spanning four continents and sell to customers in over 70 countries. Moreover, a significant amount of our manufacturing functions and sources of our raw materials and components are from Asia, principally China. Accordingly, our business and results of operations, as well as the business and results of operations of our vendors, suppliers and customers, are subject to risks associated with doing business internationally, including:

 

  •  

changes in foreign currency exchange rates;

 

  •  

trade protection measures, such as tariff increases, and import and export licensing and control requirements;

 

  •  

potentially negative consequences from changes in tax laws or tax examinations;

 

  •  

instability in a specific country’s or region’s political, economic or social conditions, particularly in emerging markets and the Middle East;

 

  •  

difficulty in staffing and managing widespread operations;

 

  •  

difficulty of enforcing agreements and collecting receivables through some foreign legal systems;

 

  •  

differing and, in some cases, more stringent labor regulations;

 

  •  

partial or total expropriation;

 

  •  

differing protection of intellectual property;

 

  •  

unexpected changes in regulatory requirements and required compliance with a variety of foreign laws, including environmental regulations and laws;

 

  •  

the burden of complying with multiple and possibly conflicting laws and any unexpected changes in regulatory requirements;

 

  •  

differing local product preferences and product requirements;

 

  •  

strong competition from companies that are already established in the markets we seek to enter;

 

  •  

inability to repatriate income or capital; and

 

  •  

difficulty in administering and enforcing corporate policies, which may be different than the normal business practices of local cultures.

Dependence on the continued operation of our manufacturing facilities.

While we are not heavily dependent on any single manufacturing facility, major disruptions at a number of our manufacturing facilities, due to labor unrest, natural disasters, terrorist attacks, significant mechanical failure of our facilities, or other catastrophic event, could result in significant interruption of our business and a potential loss of customers and sales or could significantly increase our operating costs.

 

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We are subject to the U.S. Foreign Corrupt Practices Act and other anti-corruption laws, as well as other laws governing our international operations; if we fail to comply with these laws we could be subject to civil or criminal penalties, other remedial measures, and legal expenses, which could adversely affect our business, financial condition and results of operations.

Our international operations are subject to the U.S. Foreign Corrupt Practices Act of 1977, as amended (“FCPA”) and other anti-corruption laws. The FCPA and these other laws generally prohibit us and our employees and intermediaries from bribing or making other prohibited payments to foreign officials or other persons to obtain or retain business or gain some other business advantage. We operate in a number of jurisdictions that pose a high risk of potential FCPA violations, and we participate in joint ventures and relationships with third parties whose actions could potentially subject us to liability under the FCPA. In addition, we cannot predict the nature, scope or effect of future regulatory requirements to which our international operations might be subject or the manner in which existing laws might be administered or interpreted.

We are also subject to other laws and regulations governing our international operations, including regulations administered by the U.S. Department of Commerce’s Bureau of Industry and Security, the U.S. Department of Treasury’s Office of Foreign Asset Control, and various non-U.S. government entities, including applicable export control regulations, economic sanctions on countries and persons, customs requirements, currency exchange regulations, and transfer pricing regulations (collectively, “Trade Control laws”).

Because of these legal and regulatory requirements, we have instituted policies, procedures and certain ongoing training of employees with regard to business ethics and designed to ensure that we and our employees comply with the FCPA and other anti-corruption laws and Trade Control laws. However, there is no assurance that our efforts have been and will be completely effective in ensuring our compliance with all applicable anti-corruption laws, including the FCPA, or other legal requirements. If we are not in compliance with the FCPA and other anti-corruption laws or Trade Control laws, we may be subject to criminal and civil penalties, disgorgement and other sanctions and remedial measures, and legal expenses, which could have an adverse impact on our business, financial condition, results of operations and liquidity. Likewise, any investigation of any potential violations of the FCPA or other anti-corruption laws by U.S. or foreign authorities could also have an adverse impact on our business, financial condition and results of operations.

We face competition in all areas of our business and may not be able to successfully compete with our competitors, which could lead to lower levels of profits and reduce the amount of cash we generate.

We are subject to competition from other producers of products that are similar to ours. Our customers often demand delivery of our products on a tight time schedule and in a number of geographic markets. If our quality of service declines or we cannot meet the demands of our customers, they may utilize the services of our competitors. Our competitors include manufacturers that may be better capitalized, may have a more extensive low-cost sourcing strategy and presence in low-cost regions or may receive significant governmental support and as a result, may be able to offer more aggressive pricing. If we are unable to continue to provide technologically superior or better quality products or to price our products competitively, our ability to compete could be harmed and we could lose customers or market share.

If we are unable to obtain raw materials at favorable prices in sufficient quantities, or at the time we require them, our operating margins and results of operations may be adversely affected.

We purchase our energy, steel, aluminum, rubber and rubber-based materials from outside sources. We do not traditionally have long-term contracts with raw material suppliers. The costs of these raw materials have been volatile historically and are influenced by factors that are outside our control. In recent years, the prices for energy, metal alloys and certain other of our raw materials have been extremely volatile. While we strive to avoid this risk through the use of price escalation mechanisms with respect to our raw materials in our customer contracts and we seek to offset our increased costs where gains are achieved in operational efficiencies, if we are unable to pass increases in the costs of our raw materials on to our customers, our operating margins and results of operations may be adversely affected if operational efficiencies are not achieved.

 

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Additionally, our businesses compete globally for key production inputs. The availability of certain raw materials, energy or other key inputs may be disrupted by any number of geopolitical factors, including political unrest and significant weather events. Such disruptions may require additional capital or operating expenditure by us or force reductions in our production volumes.

The non-residential construction end market is cyclical and affects market conditions for our products and services.

The non-residential construction end market is cyclical, and the downturn in the non-residential construction end market has caused a decline in the demand for our products. Certain of our products are primarily used in the non-residential construction end market and therefore our sales and earnings are strongly influenced by decreased non-residential construction activity. Non-residential construction activity can decline because of many other factors that we cannot control, such as a decline in general economic activity or the availability of credit, a decrease in infrastructure spending, an increase in raw material and overall construction costs and interest rate increases.

A portion of our business relies on home improvement and new home construction activity levels, both of which are inherently cyclical and recently experienced a significant downturn.

A portion of our business relies on residential new construction and repair and refurbishment end markets. The residential new construction market, which is cyclical in nature, has undergone a significant downturn marked by declines in the demand for new homes, an oversupply of new and existing homes on the market and a reduction in the availability of financing for homebuyers. The oversupply of existing homes held for sale has been exacerbated by a growing number of home mortgage foreclosures, which has contributed to the downward pressure on home prices. Low levels of consumer confidence, high levels of unemployment and the downward pressure on home prices have made it more difficult for some homeowners to make additional investments in their homes, such as remodeling projects. Further, disruptions in the credit markets have limited the ability of consumers to finance home improvements. In addition, the economic turmoil has caused certain shifts in consumer preferences and purchasing practices and has resulted in changes in the business models and strategies of our customers. Such shifts, which may or may not be long-term, have altered the nature and prices of products demanded by the end consumer and our customers. If we do not timely and effectively respond to these changing consumer preferences, our relationships with our customers could be adversely affected, the demand for our products could be reduced and our market share could be negatively affected.

If we lose our senior management or key personnel, our business may be materially and adversely affected.

The success of our business is largely dependent on our senior management team, as well as on our ability to attract and retain other qualified key personnel. In addition, there is significant demand in our industry for skilled workers. We cannot assure you that we will be able to retain all of our current senior management personnel and to attract and retain other necessary personnel, including skilled workers, necessary for the development of our business. The loss of the services of senior management and other key personnel or the failure to attract additional personnel as required could have a material adverse effect on our business, financial condition and results of operations.

We may be subject to recalls, product liability claims or may incur costs related to product warranties that may materially and adversely affect our business.

Meeting or exceeding many government-mandated safety standards is costly and requires manufacturers to remedy defects related to motor vehicle safety through recall campaigns if the products do not comply with safety standards. If we, customers or government regulators determine that a product is defective or does not comply with safety standards prior to the start of production, the launch of a product could be delayed until such defect is remedied. The costs associated with any protracted delay of a product launch or a recall campaign to remedy defects in products that have been sold could be substantial.

 

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We face an inherent risk of product liability claims if product failure results in any claim for injury or loss. Litigation is inherently unpredictable and these claims, regardless of their outcome, may be costly, divert management attention and adversely affect our reputation. Supplier consolidation and the increase in low-cost country sourcing may increase the likelihood of receiving defective materials, thereby increasing the risk of product failure and resulting liability claims. In addition, even if we are successful in defending against a claim relating to our products, claims of this nature could cause our customers to lose confidence in our products and us.

From time to time, we receive product warranty claims from our customers, pursuant to which we may be required to bear costs of repair or replacement of certain of our products. Vehicle manufacturers are increasingly requiring their outside suppliers to participate in the warranty of their products and to be responsible for the operation of these component products in new vehicles sold to consumers. Warranty claims may range from individual customer claims to full recalls of all products in the field. We cannot assure you that costs associated with providing product warranties will not be material.

Our insurance may not fully cover all future losses we may incur.

Manufacturers of products such as ours are subject to inherent risks. We maintain an amount of insurance protection that we consider adequate, but we cannot provide any assurance that our insurance will be sufficient or provide effective coverage under all circumstances and against all hazards or liabilities to which we may be subject. Specifically, our insurance may not be sufficient to replace facilities or equipment that are damaged in part or in full. Damages or third party claims for which we are not fully insured could hurt our financial results and materially harm our financial condition. Further, due to rising insurance costs and changes in the insurance markets, insurance coverage may not continue to be available at all or at rates or on terms similar to those presently available. Additionally, our insurance may subject us to significant deductibles, self-insured retentions, retrospectively rated premiums or similar costs. Any losses not covered by insurance could have a material adverse effect on us. We typically purchase business interruption insurance for our facilities. However, if we have a stoppage, our insurance policies may not cover every contingency and may not be sufficient to cover all of our lost revenues. In the future, we may be unable to purchase sufficient business interruption insurance at desirable costs.

We supply products to industries which are subject to inherent risks, including equipment defects, malfunctions and failures and natural disasters, which could result in unforeseen and damaging events. These risks may expose us, as an equipment operator and supplier, to liability for personal injury, wrongful death, property damage, pollution and other environmental damage. The insurance we carry against many of these risks may not be adequate to cover our claims or losses. Further, insurance covering the risks we expect to face or in the amounts we desire may not be available in the future or, if available, the premiums may not be commercially justifiable. If we were to incur substantial liability and such damages were not covered by insurance or were in excess of policy limits, or if we were to incur liability at a time when we were not able to obtain liability insurance, our business, results of operations, cash flows and financial condition could be negatively impacted. If our clients suffer damages as a result of the occurrence of such events, they may reduce their business with us.

We are subject to risks from litigation that may materially impact our operations.

We face an inherent business risk of exposure to various types of claims and lawsuits. We are involved in various intellectual property, product liability, product warranty, environmental claims and lawsuits, including other legal proceedings that arise in the ordinary course of our business. Although it is not possible to predict with certainty the outcome of every claim and lawsuit and the range of probable loss, we believe these lawsuits and claims will not individually or in the aggregate have a material impact on our results. However, we could in the future be subject to various lawsuits, including intellectual property, product liability, product warranty, environmental claims and antitrust claims, among others and incur judgments or enter into settlements of lawsuits and claims that could have a material adverse effect on our results of operations in any particular period.

Failure to develop, obtain and protect intellectual property rights could adversely affect our competitive position.

Our success depends on our ability to develop technologies and inventions used in our products and to brand such products, to obtain intellectual property rights in such technologies, inventions, and brands, and to protect and enforce such intellectual property rights. In this regard, we rely on U.S. and foreign trademark, patent,

 

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copyright, and trade secret laws, as well as license agreements, nondisclosure agreements, and confidentiality and other contractual provisions. Nevertheless, the technologies and inventions developed by our engineers in the future may not prove to be as valuable as those of competitors, or competitors may develop similar or identical technologies and inventions independently of us and before we do.

We may not be able to obtain patents or other intellectual property rights in our new technologies and inventions or, if we do, the scope of such rights may not be sufficiently broad to afford us any significant commercial advantage over our competitors. Owners of intellectual property rights that we need to conduct our business as it evolves may be unwilling to license such intellectual property rights to us on terms we consider reasonable. Competitors and others may successfully challenge the ownership, validity, and/or enforceability of our intellectual property rights. In the past, pirates have counterfeited certain of our products and sold them under our trademarks, which has led to loss of sales. It is difficult to police such counterfeiting, particularly on a worldwide basis, and the efforts we take to stop such counterfeiting may not be effective.

Our other efforts to enforce our intellectual property rights against infringers may not prove successful and will likely be time-consuming and expensive and divert management’s attention from the day-to-day operation of our business. Adequate remedies may not be available in the event of an unauthorized use or disclosure of our trade secrets and manufacturing expertise. If we fail to successfully enforce our intellectual property rights, our competitive position could suffer, which could harm our business, financial condition, results of operations and cash flows. We operate in industries with respect to which there are many patents, and it is not possible for us to ascertain that none of our products infringes any patents. If we were found to infringe any patent rights or other intellectual property rights of others, we could be required to pay substantial damages or we could be enjoined from offering certain products and services.

Our information technology systems suffer from certain deficiencies, which we are in the process of remedying.

Through acquisitions of other companies, we have inherited multiple stand-alone Enterprise Resource Planning (“ERP”) systems, and in general our information technology (“IT”) systems are decentralized. This decentralization leads to security risks and makes access to common applications cumbersome. We are in the midst of several large-scale IT projects, including with respect to ERP systems, consolidation of applications and servers, and global Wide Area Network. The costs of such projects may exceed the amounts we have budgeted for them, and any material failures in the execution of such projects may hinder our day-to-day operations.

Longer product lives of automotive parts are adversely affecting aftermarket demand for some of our products.

The average useful life of automotive parts has steadily increased in recent years due to innovations in products, technologies and manufacturing processes. The longer product lives allow vehicle owners to replace parts of their vehicles less often. As a result, a portion of sales in the aftermarket has been displaced. This has adversely impacted, and could continue to adversely impact, our aftermarket sales. Also, any additional increases in the average useful lives of automotive parts would further adversely affect the demand for our aftermarket products.

Pricing pressures from our customers may adversely affect our business.

We face the greatest pricing pressure from our customers in the automotive Original Equipment (“OE”) end market. Virtually all vehicle manufacturers seek price reductions in both the initial bidding process and during the term of the award. We are also, from time to time, subject to pricing pressures from customers in our other markets. If we are not able to offset price reductions through improved operating efficiencies and reduced expenditures or new product introduction, those price reductions may have a material adverse effect on our results of operations.

We may not be able to accurately forecast demand or meet significant increases in demand for our products.

We order raw materials and supplies and plan production based on discussions with our customers and internal forecasts of demand. If we are unable to accurately forecast demand for our products, in terms of both volume and specific products, we may experience delayed product shipments and customer dissatisfaction. Additionally, if demand increases significantly from what has been a historical low for production over the last two

 

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years, both we and our suppliers may have difficulty meeting such demand, particularly if such demand increases occur rapidly. Failure to accurately forecast demand or meet significant increases in demand could have an adverse impact on our business, financial condition and operating results.

We are dependent upon our lenders for financing to execute our business strategy and meet our liquidity needs and the lack of adequate financing could negatively impact our business.

In the current volatile credit market, there is risk that any lenders, even those with strong balance sheets and sound lending practices, could fail or refuse to honor their legal commitments and obligations under existing credit commitments, including but not limited to: extending credit up to the maximum permitted by a credit facility, allowing access to additional credit features and otherwise accessing capital and/or honoring loan commitments. If our lenders failed to honor their legal commitments under our senior secured revolving credit facility, it could be difficult in this environment to replace our senior secured revolving credit facility on similar terms.

We may in the future dispose of non-core businesses or acquire related businesses, which we may not be able to successfully integrate, and we may be unable to recoup our investment in these businesses.

From time to time we may make strategic acquisitions of complementary businesses to expand our product portfolio and geographic presence and may dispose of non-core businesses. Acquisitions and disposals, particularly investments in emerging markets, involve legal, economic and political risks. We also encounter risks in the selection of appropriate investment and disposal targets, execution of the transactions and integration of acquired businesses.

While we believe we have successfully integrated the operations we have acquired, we may not be able to effectively integrate newly acquired companies or successfully implement appropriate operational, financial and management systems and controls to achieve the benefits expected to result from these acquisitions. As a result, we may not be able to recoup our investment in those acquisitions or achieve the economic benefits that we anticipate from these acquisitions. Our efforts to integrate these businesses could be affected by a number of factors beyond our control, such as general economic conditions and increased competition. In addition, the process of integrating these businesses could cause the interruption of, or loss of momentum in, the activities of our existing business. The diversion of management’s attention and any delays or difficulties encountered in connection with the integration of these businesses could negatively impact our business and results of operations.

Environmental compliance costs and liabilities and responses to concerns regarding climate change could affect our financial condition, results of operations and cash flows adversely.

Our operations and properties are subject to stringent U.S. and foreign, federal, state, local and provincial laws and regulations relating to environmental protection, including laws and regulations governing the investigation and clean up of contaminated properties as well as air emissions, water discharges, waste management and disposal and workplace health and safety. Such laws and regulations affect all of our operations, are continually changing, are generally different in every jurisdiction and can impose substantial fines and sanctions for violations. Further, they may require substantial clean-up costs for our properties (many of which are sites of long-standing manufacturing operations) and the installation of costly pollution control equipment or operational changes to limit pollution emissions and/or decrease the likelihood of accidental releases of regulated materials. We must conform our operations and properties to these laws and adapt to regulatory requirements in all jurisdictions as these requirements change.

Hydrocarbons, chlorinated solvents or other hazardous substances or wastes may have been disposed or released on, under or from properties owned, leased or operated by us or on, under or from other locations where such substances or wastes have been taken for disposal. As a result, these properties may be subject to investigatory, cleanup and monitoring requirements under U.S. and foreign, federal, state, local and provincial environmental laws and regulations. Such liability may be imposed without regard to the legality of the original actions and without regard to whether we knew of, or were responsible for, the presence of such hazardous or toxic substances, and such liability may be joint and several with other parties. If the liability is joint and several, we could be responsible for payment of the full amount of the liability, whether or not any other responsible party also is liable.

 

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We have experienced, and expect to continue to experience, both operating and capital costs to comply with environmental laws and regulations, including costs (both legal and technical) associated with the clean-up and investigation of some of our current and former properties as well as our offsite disposal locations. We are currently performing environmental investigations and remediation at a number of former and current facilities in the United States and Canada, as well as at a facility in Belgium. We have incurred and will continue to incur costs to investigate and remediate conditions at those sites. We are also incurring costs associated with contamination at approximately twenty offsite waste disposal sites. We have established reserves with respect to such remediation matters. In addition to these costs, new laws and regulations, stricter enforcement of existing laws and regulations, the discovery of previously unknown contamination, the imposition of new clean-up requirements, or new claims for property damage, personal injury or damage to natural resources arising from environmental matters could require us to incur costs or become the basis for new or increased liabilities that could have a material adverse effect on our business, financial condition and results of operations.

In addition, increasing efforts globally to control emissions of carbon dioxide, methane and other greenhouse gases (“GHG”), have the potential to impact our facilities, products or customers. Certain countries, states, provinces and regulatory agencies have taken steps, or are in the process of evaluating options, including so-called “cap and trade” systems, to regulate GHG emissions. The stringency of these measures varies among jurisdictions where we have operations. These developments and further legislation that is likely to be enacted in other countries, states or provinces could affect our operations both positively and negatively. Changes in other environmental regulations could also adversely affect the demand for or suitability of some of our products.

We are exposed to exchange rate fluctuations in the international markets in which we operate. A decrease in the value of any of these currencies relative to the U.S. dollar could reduce profits from international operations and the recorded value of our international net assets.

We conduct operations in many areas of the world involving transactions denominated in a variety of functional currencies, which are other than our reporting currency. We are subject to currency exchange rate risk to the extent that our costs may be denominated in currencies other than those in which we earn and report revenues and vice versa. In addition, since our financial statements are denominated in U.S. dollars, changes in currency exchange rates between the U.S. dollar and our various functional currencies have had, and will continue to have, an impact on our earnings.

We also face risks arising from the imposition of exchange controls and currency devaluations. Exchange controls may limit our ability to convert foreign currencies into U.S. dollars or to remit dividends and other payments by our foreign subsidiaries or businesses located in or conducted within a country imposing controls. Currency devaluations result in a diminished value of funds denominated in the currency of the country instituting the devaluation. Actions of this nature, if they occur or continue for significant periods of time, could have an adverse effect on our results of operations and financial condition in any given period.

Our reporting currency is the U.S. dollar. Gains and losses from the remeasurement of assets and liabilities that are receivable or payable in a currency other than functional currency are included in the consolidated statements of operations. The remeasurement has caused the U.S. dollar value of our international results of operations to vary with exchange rate fluctuations, and the U.S. dollar value of our international results of operations will continue to vary with exchange rate fluctuations.

A fluctuation in the value of any of these currencies relative to the U.S. dollar could reduce our profits from non-U.S. operations and the translated value of the net assets of our non-U.S. operations when reported in U.S. dollars in our financial statements. This could have a negative impact on our business, financial condition or results of operations as reported in U.S. dollars. In addition, fluctuations in currencies relative to currencies in which the earnings are generated may make it more difficult to perform period-to-period comparisons of our reported results of operations.

We anticipate that there will be instances in which costs and revenues will not be exactly matched with respect to currency denomination. As a result, to the extent we expand geographically, we expect that increasing portions of our revenues, costs, assets and liabilities will be subject to fluctuations in foreign currency valuations. We may experience economic loss and a negative impact on earnings or net assets solely as a result of foreign currency exchange rate fluctuations. Further, the markets in which we operate could restrict the removal or conversion of the local or foreign currency, resulting in our inability to hedge against these risks.

 

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We may be adversely impacted by work stoppages and other labor matters.

As of April 2, 2011, we had approximately 28,000 employees worldwide. Approximately 2,400 of our employees in the United States and Canada are represented by various unions under collective bargaining agreements, including several that expire over the next twelve months. While we have no reason to believe that we will be impacted by work stoppages and other labor matters, we cannot assure that future issues with our labor unions will be resolved favorably or that we will not encounter future strikes, work stoppages, or other types of conflicts with labor unions or our employees. Any of these factors may have an adverse effect on us or may limit our flexibility in dealing with our workforce. In addition, many of our customers have unionized work forces. If one or more of our customers experience a material work stoppage, it could have a material adverse effect on our business, results of operations and financial condition.

If we are required to make unexpected payments to any pension plans applicable to our employees, our financial condition may be adversely affected.

Some of our and our subsidiaries’ employees participate in defined benefit pension plans. The plans in the U.K. have a pension deficit as calculated under IAS19. The largest U.S. defined benefit pension plan, the Gates Group Retirement Plan also has a pension deficit. Tomkins has guaranteed the obligations of Gates UK Limited to its pension plan, and the obligations of Tomkins’ subsidiary that is the “principal employer” of the one section of the 2008 pension plan that is not directly sponsored by Tomkins. Various factors, such as changes in actuarial estimates and assumptions (including in relation to life expectancy and rate of return on assets) as well as actual return on assets, can increase the expenses and liabilities of the defined benefit pension plans. The assets and liabilities of the plans must be valued from time to time under applicable funding rules and as a result we may be required to increase the cash payments we make under these defined benefit pension plans. For a further description of the pension deficit see the notes to our financial statements included elsewhere in this prospectus.

We could also be required at any time to make accelerated payments up to the full buy-out deficit in our defined benefit pension plans, which would likely be far higher than the normal ongoing funding cost of the plans, if we receive a “Contribution Notice” or a “Financial Support Direction” from the U.K. Pensions Regulator or if we are required to terminate one or more of the U.S. defined benefit pension plans by the U.S. Pension Benefit Guarantee Corporation (“PBGC”). A Contribution Notice typically can be issued where there has been an act or omission which is materially detrimental to the pension plan or has as one of its main purposes the prevention of the recovery of a debt due to the plan or the compromise or settlement of such a debt. A Financial Support Direction can be issued at any time where the employer in the plan is either a services company or insufficiently resourced (meaning that its net assets are less than fifty percent of its share of the buy-out deficit in the relevant plan, and there are other group companies who have sufficient assets to make up the difference). The PBGC may institute proceedings to terminate a U.S. defined benefit pension plan for a number of reasons, including if it determines that a plan will be unable to pay benefits when due or if the possible long-run loss of the PBGC with respect to a plan may reasonably be expected to increase unreasonably if the plan is not terminated.

Our reported results of operations and financial condition may be adversely affected to the extent that we are required to make any additional payments to any relevant defined benefit pension plans in excess of the amounts assumed in our current plans or that we must report higher pension plan expenses under IAS19.

Terrorist acts, conflicts and wars may materially adversely affect our business, financial condition and results of operations.

As a company with a large international footprint, we are subject to increased risk of damage or disruption to us, our employees, facilities, partners, suppliers, distributors, resellers or customers due to terrorist acts, conflicts and wars, wherever located around the world. The potential for future attacks, the national and international responses to attacks or perceived threats to national security, and other actual or potential conflicts or wars have created many economic and political uncertainties. Although it is impossible to predict the occurrences or consequences of any such events, they could result in a decrease in demand for our products, make it difficult or

 

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impossible to deliver products to our customers or to receive components from our suppliers, create delays and inefficiencies in our supply chain and result in the need to impose employee travel restrictions, and thereby adversely affect our business, financial condition, results of operations and cash flows.

We have taken, and continue to take, cost-reduction actions, which may expose us to additional production risk and we may not be able to maintain the level of cost reductions that we have achieved.

We have been reducing costs in all of our businesses and have discontinued product lines, exited businesses, consolidated manufacturing operations and reduced our employee population. The impact of these cost-reduction actions on our sales and profitability may be influenced by many factors and we may not be able to maintain the level of cost savings that we have achieved depending on our ability to successfully complete these efforts. In connection with the implementation and maintenance of our cost-reduction measures, we may face delays in implementation of anticipated workforce reductions, a decline in employee morale and a potential inability to meet operational targets due to an inability to retain or recruit key employees.

We are dependent on market acceptance of new product introductions and product innovations for continued revenue growth.

The markets in which we operate are subject to technological change. Our long-term operating results depend substantially upon our ability to continually develop, introduce, and market new and innovative products, to modify existing products, to respond to technological change, and to customize certain products to meet customer requirements. There are numerous risks inherent in this process, including the risks that we will be unable to anticipate the direction of technological change or that we will be unable to develop and market new products and applications in a timely fashion to satisfy customer demands.

 

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USE OF PROCEEDS

We will not receive any cash proceeds from the issuance of the exchange notes pursuant to the exchange offer. In consideration for issuing the exchange notes as contemplated in this prospectus, we will receive in exchange a like principal amount of initial notes, the terms of which are identical in all material respects to the exchange notes, including with respect to the interest rate and maturity, except that the exchange notes will not contain terms with respect to transfer restrictions or additional interest upon a failure to fulfill certain of our obligations under the registration rights agreement. The initial notes surrendered in exchange for the exchange notes will be retired and canceled and cannot be reissued. Accordingly, the issuance of the exchange notes will not result in any change in our indebtedness.

 

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CAPITALIZATION

The following table sets forth our capitalization as of April 2, 2011 on a historical basis. The table below should be read in conjunction with “Unaudited Pro Forma Financial Information,” “Selected Historical Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our historical consolidated financial statements, including the related notes, appearing elsewhere in this prospectus.

 

$ in millions    As of April 2, 2011
Actual
(Unaudited)		  

Cash and cash equivalents

    $ 327.4   
        

Collateralized cash (1)

    $ 49.0   
        

Senior secured credit facilities(2):

   

Revolving credit facility

      — (3) 

Term Loan A facility

      288.6   

Term Loan B facility

      1,673.1   

Second Lien Notes

      1,150.0   

Loan note alternative

      46.7   

Medium term notes

      191.9   

Other existing indebtedness

      8.7   
        

Total principal debt

      3,359.0   

Shareholders’ equity

      2,158.6   
        

Total capitalization

    $ 5,517.6   
        

 

(1) Included within trade and other receivables in our consolidated balance sheet.
(2) We initially borrowed $300.0 million under the Term Loan A facility and $1,700.0 million under the Term Loan B facility. On December 29, 2010, we prepaid $4.0 million against the Term Loan A facility and $22.7 million against the Term Loan B facility. During Q1 2011, we made quarterly amortization payments of $7.4 million against the Term Loan A facility and of $4.2 million against the Term Loan B facility.
(3) We have a revolving credit facility of $300 million. See “Description of Certain Indebtedness—Description of Senior Secured Credit Facilities.” As at April 2, 2011, there were no drawings for cash but there were letters of credit amounting to $39.7 million outstanding against the facility.

 

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UNAUDITED PRO FORMA FINANCIAL INFORMATION

Introduction

The unaudited pro forma financial information has been prepared to reflect the following Events:

 

  •  

the Acquisition;

 

  •  

the incurrence of indebtedness under our senior secured credit facilities and the initial notes which was used to partially finance the Acquisition;

 

  •  

the tender offer to purchase the outstanding 2011 Notes and 2015 Notes that we made in September 2011 as a requirement of the senior secured credit facility agreement (settlement of the tendered notes occurred in October 2010);

 

  •  

the exercise by certain holders of our 2011 Notes and 2015 Notes of their right to put the notes to us that occurred in November 2010 (the put rights having arisen as a consequence of the ratings downgrade that resulted from the Acquisition); and

 

  •  

the tender offer to purchase the outstanding 2011 Notes that we made in December 2010 as a requirement of the senior secured credit facility agreement (settlement of the tendered notes took place in January 2011).

The Events are described in more detail in “Summary—The Transactions” included elsewhere in this prospectus.

Basis of preparation

The unaudited pro forma financial information comprises the unaudited pro forma condensed consolidated income statements of Holdings (i) for the year ended December 31, 2010 (“Fiscal 2010”), which is based on the consolidated income statement of the Predecessor for the period from January 3, 2010 to September 24, 2010 (“9M 2010”) and on the consolidated income statement of the Successor for the period from September 25, 2010 to December 31, 2010 (“Q4 2010”) that are included elsewhere in this prospectus; and (ii) for the 14-week period ended April 3, 2010 (“Q1 2010”), which is based on the unaudited condensed consolidated income statement for the period that is included elsewhere in this prospectus. Pro forma financial information for Q1 2010 is presented for the purposes of facilitating the discussion in management discussion and analysis of the Q1 2011 results.

The unaudited pro forma adjustments described in the accompanying notes give effect to the Events as if they had occurred on January 3, 2010. The unaudited pro forma adjustments are based on currently available information and certain assumptions that we believe are reasonable and supportable.

The unaudited pro forma financial information does not give effect to items of income and expense (including costs directly attributable to the Acquisition) that were incurred in connection with the Events but will not have a continuing impact for us beyond the twelve months following completion of the Events.

The unaudited pro forma financial information is presented solely for informational purposes and is not intended to represent or be indicative of the consolidated income statement of the Company had the Events been completed as of January 3, 2010, nor is it necessarily indicative of future results. The unaudited pro forma financial information should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements of Holdings and related notes included elsewhere in this document.

The unaudited pro forma adjustments do not reflect any other transactions since January 3, 2010.

 

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The Acquisition

Tomkins Acquisitions made an offer to acquire the entire issued and to be issued share capital of Tomkins for 325 pence per ordinary share in cash.

The purchase consideration was $4,615.4 million (converted from Sterling into U.S. dollars using the exchange rate implicit in forward currency contracts entered into by the Sponsors to hedge their currency exposure with regard to the purchase consideration) and included the cost of acquiring all shares that were the subject of share option and other share-based incentive schemes. The purchase consideration was settled as to $4,535.0 million in cash, $45.5 million in loan notes and $34.9 million in options granted over ordinary “B” shares in Holdings.

The Acquisition was accounted for by Holdings as a business combination in accordance with IFRS 3 (Revised 2008) “Business Combinations.” Goodwill amounting to $1,742.1 million was recognized on the Acquisition which represented the excess of the aggregate of the purchase consideration and the amount of the non-controlling interests in Tomkins over the identifiable assets and liabilities of Tomkins measured at the effective date of the Acquisition, as follows:

 

     $ in millions  

Consideration

      4,615.4  

Non-controlling interests

      304.5  
        
     4,919.9  

Identifiable assets and liabilities acquired

      (3,177.8 ) 
        

Goodwill

      1,742.1  
        

Holdings initially recognized the identifiable assets and liabilities of Tomkins measured at their fair value at the effective date of the Acquisition, except for the following items that were measured in accordance with the relevant accounting policies set out in note 3 to the consolidated financial statements of Holdings:

 

  •  

pensions and other post-employment benefit arrangements;

 

  •  

equity instruments related to the replacement of share-based incentives awarded to the employees of Tomkins;

 

  •  

deferred tax assets and liabilities of Tomkins; and

 

  •  

assets classified as held for sale.

Non-controlling interests in Tomkins were measured at the proportionate share of the non-controlling interests in the identifiable assets and liabilities of Tomkins.

A detailed analysis of the identifiable assets and liabilities of Tomkins at the effective date of the Acquisition is presented in note 41 to the consolidated financial statements of Holdings.

Management has not yet finalized its assessment of the fair values at the effective date of the Acquisition of certain identifiable intangible assets and items of property, plant and equipment. Management expects to complete the assessment during the second quarter of 2011 and does not expect any adjustments arising from the completion of the assessment to give rise to any material changes to the unaudited pro forma financial information.

 

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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT

Year Ended December 31, 2010

(dollars in millions)

 

     Successor     Predecessor     Pro Forma Adjustments     Pro Forma  
     Q4 2010     9M 2010     Acquisition
accounting
adjustments 		    Draw-
down of
new debt		     Repayment
of Tomkins
debt		     Other     Fiscal
2010		  

Continuing operations

                 

Sales

      1,289.2       3,564.7       —          —          —          —          4,853.9  

Cost of sales

      (1,038.1 )      (2,437.7 )      113.0  (A)      —          —          —          (3,362.8 ) 
                                                        

Gross profit

      251.1       1,127.0       113.0        —          —          —          1,491.1  

Distribution costs

      (144.6 )      (382.4 )      —          —          —          —          (527.0 ) 
 

Administrative expenses

      (230.8 )      (358.2 )      (94.7 ) (A),(B)      —          —          (2.4 ) (F)      (686.1 ) 
 

Transaction costs

      (78.2 )      (41.5 )      119.1  (B)      —          —          —          (0.6 ) 

Restructuring costs

      (2.0 )      (10.0 )      —          —          —          —          (12.0 ) 

Net gain on disposals and on the exit of businesses

      —          6.3       —          —          —          —          6.3  

Share of profit/(loss) of associates

      0.7       (1.3 )      —          —          —          —          (0.6 ) 
                                                        

Operating (loss)/profit

      (203.8 )      339.9       137.4        —          —          (2.4 )      271.1  
 

Interest expense

      (90.9 )      (71.8 )      —          (208.7 ) (C)      10.0  (D)      —          (361.4 ) 

Investment income

      18.7       48.2       —          —          —          —          66.9  

Other finance (expense)/income

      (27.1 )      (2.7 )      47.6  (B)      —          7.5  (E)      —          25.3  
                                                        

Net finance (costs)/income

      (99.3 )      (26.3 )      47.6        (208.7 )      17.5        —          (269.2 ) 
                                                        

(Loss)/profit before tax

      (303.1 )      313.6       185.0        (208.7 )      17.5        (2.4 )      1.9  

Income tax benefit/(expense)

      32.9       (62.8 )      (8.1 ) (G)      72.6  (G)      —          —          34.6   
                                                        

(Loss)/profit for the period from continuing operations

      (270.2 )      250.8       176.9        (136.1 )      17.5        (2.4 )      36.5   
                                                        

 

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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT

Quarter Ended April 3, 2010

(dollars in millions)

 

     Predecessor                 Pro Forma Adjustments     Pro Forma  
     Q1 2010                 Acquisition
accounting
adjustments 		    Draw-
down of
new debt		     Repayment
of Tomkins
debt		     Other     Q1 2010  

Continuing operations

                 

Sales

      1,165.9           —          —          —          —          1,165.9  

Cost of sales

      (801.9 )          (10.7 ) (A)      —          —          —          (812.6 ) 
                                                    

Gross profit

      364.0           (10.7 )      —          —          —          353.3  

Distribution costs

      (125.7 )          —          —          —          —          (125.7 ) 

Administrative expenses

      (112.9 )          (37.0 ) (C)      —          —          (0.6 ) (F)      (150.5 ) 

Restructuring costs

      (1.9 )          —          —          —          —          (1.9 ) 

Net gain on disposals and on the exit of businesses

      1.4           —          —          —          —          1.4  

Share of profit of associates

      0.1           —          —          —          —          0.1  
                                                    

Operating profit

      125.0            (47.7 )      —          —          (0.6 )      76.7  
 

Interest expense

      (24.1 )          —          (68.8 ) (C)      2.4  (D)      —          (90.5 ) 

Investment income

      16.2           —          —          —          —          16.2  

Other finance expense

      (2.4 )          —          —          0.1  (E)      —          (2.3 ) 
                                                    

Net finance costs

      (10.3 )          —          (68.8 )      2.5         —          (76.6 ) 
                                                    

Profit before tax

      114.7           (47.7 )      (68.8 )      2.5         (0.6 )      0.1  

Income tax (expense)/benefit

      (29.2 )          15.8  (G)      23.9  (G)      —          —          10.5  
                                                    

Profit for the period from continuing operations

      85.5           (31.9 )      (44.9 )      2.5         (0.6 )      10.6  
                                                    

 

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NOTES TO THE UNAUDITED PRO FORMA CONDENSED

CONSOLIDATED INCOME STATEMENT

(dollars in millions)

Adjustments relating to the Acquisition

(A) Acquisition accounting adjustments

We have adjusted for the effect on the unaudited pro forma financial information of certain of the acquisition accounting adjustments to the carrying amount of the identifiable assets and liabilities of Tomkins as at the effective date of the Acquisition as follows:

Cost of Sales

Pro forma cost of sales for Fiscal 2010 has been increased by $31.2 million to reflect the additional depreciation expense that would have been recognized during 9M 2010 on the fair value uplift to the carrying amount of the property, plant and equipment held by Tomkins. Similarly, pro forma cost of sales for Q1 2010 has been increased by $10.7 million.

As a result of accounting for the Acquisition, the carrying amount of the inventory held by Tomkins was uplifted by $144.2 million. As this inventory was sold by our businesses during Q4 2010, the effect of the uplift was a non-recurring increase of $144.2 million to cost of sales during Q4 2010 which has therefore been reversed in arriving at pro forma cost of sales for Fiscal 2010.

 

$ in millions    Pro forma
Fiscal  2010		     Pro forma
Q1  2010		  

Additional depreciation expense

      31.2        10.7  

Reversal of fair value uplift to inventory

      (144.2 )      —     
                

Adjustment to cost of sales

      (113.0 )      10.7  
                

Administrative Expenses

Pro forma administrative expenses have been increased by $108.2 million, principally to reflect the additional amortization expense that would have been recognized during 9M 2010 on the fair value uplift to the carrying amount of the identifiable intangible assets held by Tomkins on the date of the Acquisition. Similarly, pro forma administrative expenses for Q1 2010 have been increased by $37.0 million.

(B) Costs relating to the Acquisition

Administrative Expenses

During the third quarter of 2010, the Predecessor recognized an accelerated compensation expense of $13.5 million in respect of the early vesting of certain of its employee share schemes as a consequence of the Acquisition. As there is no continuing impact on Holdings, the additional compensation expense has been reversed as a pro forma adjustment in Fiscal 2010.

Transaction Costs

Costs recognized in relation to the Acquisition during the second, third and fourth quarters of 2010 amounted to $119.1 million (including $40.9 million incurred by the Predecessor). As there is no continuing impact on Holdings, these transaction costs have been reversed as a pro forma adjustment in Fiscal 2010.

 

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Other Finance (Expense)/Income

During Q4 2010, the Successor recognized a currency translation loss of $47.6 million on the Acquisition due to the change in the rate of exchange between Sterling (in which the purchase consideration was denominated) and the U.S. dollar (the functional currency of the acquiring entity) in the period between the effective date of the Acquisition and the payment of the consideration to the former shareholders in Tomkins. As there is no continuing impact on Holdings, the currency translation loss has been reversed as a pro forma adjustment in Fiscal 2010.

Draw-Down of New Debt

(C) Additional Interest Expense

We have adjusted the pro forma financial information to reflect the interest expense that would have been recognized had the notes and the amounts drawn against the senior secured credit facilities as at December 31, 2010 been outstanding throughout Fiscal 2010.

We have calculated the additional interest expense on the notes using the effective interest rate method, based on the coupon rate of 9% and taking into account the deferred financing costs attributed to the notes.

Borrowings under the senior secured credit facilities bear interest at a floating rate, which can be either based on LIBOR plus an applicable margin or, at our option, based on a base rate as defined in the credit agreement plus an applicable margin. Both LIBOR and the base rate are subject to a floor.

We have calculated the additional interest expense on our senior secured credit facilities using the effective interest rate method, based on the amounts drawn against the facilities and the terms of the facilities as they existed as at December 31, 2010 and taking into account the deferred financing costs that were attributed to the amounts drawn under the facilities. We have not taken into account the effect on interest expense of the re-pricing of the senior secured credit facilities that became effective on February 17, 2011.

As at December 31, 2010, interest payable in relation to our borrowings under the senior secured credit facilities was based upon 3-month U.S.$ LIBOR, which was 0.29% but was subject to a floor of 1.75%. Accordingly, the interest expense has been calculated as follows:

 

  •  

on the $296.0 million outstanding against the Term Loan A credit facility, based on interest payable at 6.00% per annum (LIBOR floor + the applicable margin of 4.25%) and the amortization of the commitment fee and other attributable financing costs over the 5-year term of the facility;

 

  •  

on the $300 million revolving credit facility, fees totalling 4.50% per annum on the $40.3 million drawn by way of letters of credit, a commitment fee of 0.75% per annum on the unutilised portion of the facility which amounted to $259.7 million and the amortization of attributable deferred financing costs over the 5-year term of the facility; and

 

  •  

on the $1,677.3 million outstanding against the Term Loan B credit facility, based on interest payable at 6.25% per annum (LIBOR floor + the applicable margin of 4.50%) and the amortization of the commitment fee and other attributable financing costs over the 6-year term of the facility.

On inception of the senior secured credit facilities, the applicable prevailing market interest rates were lower than the floor which applied to LIBOR or the base rate as defined in the credit agreement. Consequently, the floor (an embedded interest rate derivative) was required to be separated from each of the host loan contracts. On inception of the facilities, the fair value of the embedded derivatives was a liability of $69.8 million. We recognized the embedded derivative as a separate liability in the Successor’s balance sheet and reduced by an equivalent amount the carrying amounts of the borrowings under the Term Loan A facility and the Term Loan B facility. We are amortizing to profit or loss the adjustments to the carrying amounts of the borrowings under the Term Loan A facility and the Term Loan B facility using the effective interest method over the respective terms of the facilities. We have adjusted the unaudited pro forma financial information to reflect the additional amortization of $3.6 million for Q1 2010 and $14.8 million for Fiscal 2010, that would have been recognized had inception of the senior secured credit facilities occurred at the beginning of Fiscal 2010.

 

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The pro forma adjustments to interest expense may be analysed as follows:

 

xxxxxxxxx xxxxxxxxx xxxxxxxxx xxxxxxxxx xxxxxxxxx xxxxxxxxx
$ in millions   Pro forma Fiscal 2010     Pro forma Q1 2010  
    Interest payable     Other interest
expense		     Total     Interest payable     Other interest
expense		     Total  

Second Lien Notes

     78.8        5.0        83.8        26.2        1.6        27.8   

Term Loan A credit facility

     13.0        3.5        16.5        4.3        1.3        5.6   

Term Loan B credit facility

     78.4        10.4        88.8        26.2        4.0        30.2   

Revolving credit facility (including letters of credit)

     —          4.8        4.8        —          1.6        1.6   

Amortization of embedded derivatives

     —          14.8        14.8        —          3.6        3.6   
                                               

Adjustment to interest expense

     170.2        38.5        208.7        56.7        12.1        68.8   
                                               

Repayment of the Tomkins Debt

(D) Reduction of Interest Expense

Subsequent to the Acquisition, certain of the existing Tomkins debt was redeemed and/or replaced by the new debt. We have adjusted the pro forma financial information such that the interest expense has been reduced by the interest expense that was recognized during the relevant period on the Tomkins debt that was replaced by the Holdings debt subsequent to the Acquisition.

Repayment of Medium Term Notes

When it was acquired by Holdings, Tomkins had £150 million of the 2011 Notes and £250 million of the 2015 Notes outstanding. Following the Acquisition, the principal amount outstanding on the 2011 Notes was reduced by £47.9 million to £102.1 million and the principal amount outstanding on the 2015 Notes was reduced by £232.8 million to £17.2 million.

Under the terms of the senior secured credit facilities, Holdings was required to commence a tender offer to purchase the outstanding notes prior to the effective date of the Acquisition and, to the extent that any of the 2011 Notes remained outstanding 90 days after the effective date of the Acquisition, Holdings was required to commence a further tender offer for all outstanding 2011 Notes.

On September 13, 2010, Holdings made the first tender offer required under the senior secured credit facilities to purchase the outstanding 2011 Notes, at a price of 105.787%, and the outstanding 2015 Notes, at a price of 100.50%. Acceptances were received in respect of £40.9 million of the 2011 Notes and £109.3 million of the 2015 Notes. On October 6, 2010, the purchase was completed for total consideration of £153.1 million.

On November 19, 2010, Holdings notified holders of the 2011 Notes and the 2015 Notes that the credit rating of the medium term notes had been withdrawn by Moody’s and downgraded by Standard & Poor’s as a consequence of the Acquisition and that this constituted a put event under the terms of the medium term notes entitling the holders to redeem the medium term notes at par. Put notices were received in respect of £2.1 million of the 2011 Notes and £123.5 million of the 2015 Notes. Settlement took place on December 17, 2010 for total consideration of £125.6 million.

On December 30, 2010, Holdings made the second tender offer required under the senior secured credit facilities to purchase the outstanding 2011 Notes, at a price of 105.00% (plus accrued and unpaid interest). Acceptances were received in respect of a further £4.9 million of the 2011 Notes. Settlement took place on January 19, 2011 for consideration of £5.1 million.

We have calculated the reduction in the interest expense due to the redemption of the 2011 Notes and the 2015 Notes using the effective interest rate method, taking into account the deferred financing costs that were attributed to the medium term notes prior to the Acquisition and the fair value adjustments to the carrying amounts of the medium term notes that were recognized on the effective date of the Acquisition.

 

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Overall, therefore, we have reduced interest expense by $8.9 million in Q1 2010 and by $27.4 million in Fiscal 2010 on the assumption that the redemptions of the 2011 Notes and the 2015 Notes took place at the beginning of Fiscal 2010.

Sale of Interest Rate Swaps

Prior to the Acquisition, Tomkins held interest rate swaps to swap the interest payable on the 2011 Notes and the 2015 Notes from fixed to floating interest rates. On September 16, 2010, Tomkins sold these interest rate swaps in anticipation of the Events.

From the beginning of Fiscal 2010 to the date on which they were sold, the interest receivable under the fixed legs of the interest rate swaps exceeded the interest payable under the fixed legs of the interest rate swaps such that they had the effect of reducing the interest payable on the 2011 Notes and the 2015 Notes. We have therefore increased interest expense by $7.1 million in Q1 2010 and by $19.0 million in Fiscal 2010 on the assumption that the interest rate swaps were sold at the beginning of Fiscal 2010.

Letters of Credit

Prior to the Acquisition, Tomkins had a revolving credit facility that was replaced by the revolving credit facility provided under the senior secured credit facilities. During 9M 2010, Tomkins made no borrowings against the revolving credit facility but incurred fees in relation to letters of credit issued under the facility that amounted to $1.6 million, of which $0.6 million was incurred in Q1 2010. As the letters of credit were replaced by letters of credit issued under senior secured credit facilities, we have eliminated these fees from the interest expense recognized in the respective periods.

The pro forma adjustment to interest expense may be analysed as follows:

 

Other interest Other interest Other interest Other interest Other interest Other interest
$ in millions    Pro forma Fiscal 2010     Pro forma Q1 2010  
     Interest
payable		     Other interest
expense		     Total     Interest
payable		     Other interest
expense		     Total  

2011 Notes

      (4.8 )      (3.7 )      (8.5 )      (1.7 )      (1.4 )      (3.1 ) 

2015 Notes

      (18.8 )      (0.1 )      (18.9 )      (5.6 )      (0.2 )      (5.8 ) 

Sale of interest rate swaps

      19.0       —          19.0       7.1       —          7.1  

Revolving credit facility (including letters of credit)

      —          (1.6 )      (1.6 )      —          (0.6 )      (0.6 ) 
                                                

Adjustment to interest expense

      (4.6 )      (5.4 )      (10.0 )      (0.2 )      (2.2 )      (2.4 ) 
                                                

(E) Adjustment to Other Finance (Expense)/Income

Hedge Ineffectiveness

Prior to the Acquisition, Tomkins had designated as fair value hedges in relation to the 2011 Notes and the 2015 Notes the interest rate swaps that it held to swap the interest payable on the notes from fixed to floating interest rates. During 9M 2010, Tomkins recognized a loss of $1.7 million in other finance (expense)/income, of which $0.6 million was recognized in Q1 2010, because there was deemed to be ineffectiveness in the hedging relationship for accounting purposes. We have eliminated the loss from other finance (expense)/income because the interest rate swaps were sold by Tomkins in anticipation of the Events.

Currency Translation Losses

The 2011 Notes and the 2015 Notes and the interest rate swaps that were designated as fair value hedges in relation to them were denominated in Sterling. Translation of these items into the functional currency of the

 

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subsidiaries of Holdings that hold them give rise to currency translation differences that are recognised in other finance expense. We have eliminated from other finance expense a net currency translation gain of $0.5 million in Q1 2010 and a net currency translation loss of $4.9 million in Fiscal 2010, which was attributable to the translation of the 2011 Notes and the 2015 Notes that were redeemed subsequent to the Acquisition and to the interest rate swaps that were sold by Tomkins in anticipation of the Events.

Loss on Redemption of Medium Term Notes

We have eliminated from other finance expense the loss of $0.9 million that Holdings recognized on the redemption of the 2011 Notes and the 2015 Notes subsequent to the Acquisition.

The pro forma adjustment to other finance (expense)/income may be analysed as follows:

 

$ in millions    Fiscal 2010      Q1 2010  

Hedge ineffectiveness

      1.7         0.6  

Currency translation loss

      4.9         (0.5 ) 

Loss on redemption of notes

      0.9         —     
                 

Adjustment to other finance (expense)/income

      7.5         0.1  
                 

Other Adjustments

(F) Management Fees Payable to the Sponsors

Holdings is required to pay to the Sponsors annual management fees amounting to $3.0 million. Administrative expenses for Q4 2010 included an expense of $0.6 million in relation to these management fees. An additional expense of $0.6 million in Q1 2010 and of $2.4 million in Fiscal 2010 has been recognized as a pro forma adjustment such that the unaudited pro forma financial information reflects the annual management fees payable by Holdings.

(G) Income Tax Adjustments

We have apportioned the pro forma adjustments to the tax jurisdictions in which they would have been recognized and we have tax effected them based on their effect on taxable income in the relevant jurisdiction using the applicable statutory tax rate. In particular, we have tax effected the pro forma adjustments that affect taxable income in the U.K. at the U.K. statutory tax rate of 28% and those that affect taxable income in the United States at the United States statutory tax rate that is applicable to the entity concerned of 37.5%.

 

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SELECTED HISTORICAL FINANCIAL INFORMATION

The following table sets forth our selected historical financial information for the periods and dates indicated. The following information is only a summary and should be read in conjunction with “Risk Factors,” “Unaudited Pro Forma Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” our historical consolidated financial statements and the audited consolidated financial statements of our business and notes thereto included elsewhere in this prospectus, as well as the other financial information included in this prospectus.

The historical financial information as of December 31, 2010 and January 2, 2010 and for Q4 2010, 9M 2010, Fiscal 2009 and Fiscal 2008 have been prepared in accordance with IFRS and have been derived from the audited consolidated financial statements included elsewhere in this prospectus.

The historical financial information as of April 2, 2011 and for Q1 2011 and Q1 2010 have been prepared in accordance with IFRS and have been derived from the unaudited condensed consolidated financial statements included elsewhere in this prospectus.

The historical financial information as of January 3, 2009, December 29, 2007 and December 30, 2006 and for the fiscal years ended December 29, 2007 (“Fiscal 2007”) and December 30, 2006 (“Fiscal 2006”) have also been prepared in accordance with IFRS and have been derived from audited consolidated financial statements not separately presented herein and for Fiscal 2007 and Fiscal 2006 after restatement for the retrospective application of “Amendments to IFRS 2 Share-based Payment – Vesting Conditions and Cancellations.”

 

    Successor     Predecessor     Successor     Predecessor  
    Q1 2011     Q1 2010     Q4 2010     9M
2010		     Fiscal  
$ in millions           2009     2008     2007     2006  

Selected Consolidated Income Statement Data:

                      

Continuing Operations

                      

Sales

   $ 1,342.9     $ 1,165.9     $ 1,289.2      $ 3,564.7      $ 4,180.1      $ 5,515.9      $ 5,886.1      $ 5,746.1   

Impairments

     —          —          —          —          (73.0 )      (342.4 )      (0.8 )      (2.9 ) 

Restructuring costs

     (5.4 )      (1.9 )      (2.0 )      (10.0 )      (144.1 )      (26.0 )      (27.6 )      (23.9 ) 

Net gain on disposals and on the exit of businesses

     0.2        1.4        —          6.3        0.2        43.0        91.4        5.7   

Gain on amendment of post-employment benefits

     —          —          —          —          63.0        —          —          —     

Operating profit/(loss)

     88.9        125.0        (203.8 )      339.9        84.7        66.9        586.0        519.0   
                                                               
     

Profit/(loss) before tax

     27.0        114.7        (303.1 )      313.6        38.4        (8.1 )      525.1        448.4   

Income tax (expense)/benefit

     (19.3 )      (29.2 )      32.9        (62.8 )      (28.5 )      (38.4 )      (139.9 )      (65.6 ) 
                                                               
     

Profit/(loss) for the period from continuing operations

     7.7        85.5        (270.2 )      250.8        9.9        (46.5 )      385.2        382.8   

Discontinued Operations

                      

Loss for the period from discontinued operations

     —          (0.8 )      —          (7.2 )      (3.9 )      —          (66.7 )      (21.3 ) 
                                                               

Profit/(loss) for the period

     7.7        84.7        (270.2 )      243.6        6.0        (46.5 )      318.5        361.5   

Non-controlling interests

     (6.9 )      (8.7 )      (0.9 )      (26.2 )      (21.6 )      (18.1 )      (25.0 )      (20.5 ) 
                                                               

Profit/(loss) for the period attributable to equity shareholders

   $ 0.8      $ 76.0      $ (271.1 )    $ 217.4      $ (15.6 )    $ (64.6 )    $ 293.5      $ 341.0   
                                                               
     

Selected Cash Flow Data:

                      

Net cash inflow/(outflow) from operating activities

   $ 36.1      $ (42.1 )    $ 45.4      $ 194.7      $ 513.0      $ 544.2      $ 552.5      $ 465.4   

Net cash (outflow)/inflow from investing activities

     (25.6 )      (54.4 )      (4,098.8 )      (103.0 )      (135.3 )      (124.0 )      12.2        (379.1 ) 

Net cash (outflow)/inflow from financing activities

     (142.1 )      (58.9 )      4,551.2        (42.1 )      (220.5 )      (401.0 )      (630.4 )      (182.7 ) 

 

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     Successor                 Predecessor  
     As of                 As of  
     April 2,
2011		     December 31,
2010		                 January 2,
2010		     January 3,
2009		     December 29,
2007		     December 30,
2006		  

Selected Balance Sheet Data:

                 

Cash and cash equivalents

    $ 327.4      $ 459.3          $ 445.0      $ 291.9      $ 295.9      $ 337.6   

Property, plant and equipment

      1,352.6        1,359.1            1,122.8        1,167.3        1,414.4        1,360.3   

Total assets

      7,636.5        7,552.3            3,673.6        3,770.7        4,472.9        4,565.8   

Total debt(1)

      (3,140.5 )      (3,165.0 )          (707.9 )      (813.0 )      (885.6 )      (1,141.2 ) 

 

(1) Total debt includes bank overdrafts, bank and other loans and obligations under finance leases.

RATIO OF EARNINGS TO FIXED CHARGES

Our ratio of earnings to fixed charges was as follows for the periods presented:

 

     Successor      Predecessor      Pro Forma      Successor     Predecessor  
     Q1      Q1      Fiscal      Q4     9M      Fiscal  
     2011      2010      2010      2010     2010      2009      2008     2007      2006  
       

Ratio of earnings to fixed charges(1)

      1.34         11.16         1.05         —          10.28         1.62         0.93        7.14         5.57   

Deficiency in ratio(2)

                     (303.8 )            (5.4 )      

 

(1) The ratio of earnings to fixed charges has been calculated based on financial information prepared in accordance with IFRS. For the purpose of calculating this ratio, earnings consist of (loss)/profit before tax from continuing operations before our share of the profit or loss of associates, plus fixed charges and the distributed earnings of associates and less the preference security dividend requirement. Fixed charges consist of interest expense, including the amortization of debt issuance costs, an estimate of the interest within rental expense and, for Fiscal 2007 and Fiscal 2006, the preference security dividend requirements of consolidated subsidiaries.

 

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(2) Earnings were deficient to cover fixed charges by $303.8 million for Q4 2010 and by $5.4 million for Fiscal 2008. Earnings for Q4 2010 were negatively impacted by charges related to the Acquisition, including:

 

  •  

the effect on cost of sales of the uplift to the carrying amount of inventory held by Tomkins on its acquisition by the Group of $144.2 million;

 

  •  

transaction costs of $78.2 million incurred in relation to the Acquisition; and

 

  •  

a currency translation loss of $47.6 million on the acquisition of Tomkins due to the change in the rate of exchange between the pound sterling (in which the purchase consideration was denominated) and the U.S. dollar (the functional currency of the acquiring entity), in the period between the effective date of the acquisition and the payment of the consideration to the former shareholders in Tomkins.

During Q4 2010, we also recognized a compensation expense in relation to share-based incentives of $72.4 million that was disproportionately high for the quarter due to the immediate vesting of certain of the awards.

 

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

On March 31, 2011, Holdings issued its first annual financial report to holders of the Notes, which contained the audited consolidated financial statements and related notes for the 14-week period from September 25, 2010 to December 31, 2010 (“Q4 2010”), for the 38-week period from January 3, 2010 to September 24, 2010 (“9M 2010”), for the 52-week period from January 4, 2009 to January 2, 2010 (“Fiscal 2009”) and for the 53-week period from December 30, 2007 to January 3, 2009 (“Fiscal 2008”) that are presented elsewhere in this prospectus.

On May 17, 2011, Holdings issued its quarterly financial report for the 13-week period from January 1, 2011 to April 2, 2011 (“Q1 2011”) which contained the unaudited condensed consolidated financial statements for that period and related notes that are presented elsewhere in this prospectus.

The following discussion should be read in conjunction with the financial statements specified above, which were prepared in accordance with IFRS and present separately the periods prior to the Acquisition (“Predecessor”) and the periods after the Acquisition (“Successor”). The Predecessor financial statements do not reflect the effects of the accounting for or the financing of the Acquisition. To facilitate a discussion of certain results of operations across periods, we have presented the results for the year ended December 31, 2010 (“Fiscal 2010”) and for the 13-week period from January 3, 2010 to April 3, 2010 (“Q1 2010”) on a pro forma basis taking in account the effects of the Events as if they had occurred on January 3, 2010. For information regarding the pro forma effects of the Events, see “Unaudited Pro Forma Financial Information” included elsewhere in this prospectus and “—Effect of the Acquisition” below.

We first discuss, inter alia, the results of our operations in Fiscal 2010 compared with Fiscal 2009 and in Fiscal 2009 compared with Fiscal 2008 and the material changes in our liquidity and capital resources during Fiscal 2010. We then go on to discuss the results of our operations in Q1 2011 compared with Q1 2010, the material changes in our liquidity and capital resources during Q1 2011 and the outlook in our end markets for the remainder of 2011.

We assess the performance of our businesses using a variety of measures. Certain of these measures are not explicitly defined under IFRS and are therefore termed “non-GAAP measures.” Under the heading “—Non-GAAP Measures” below, we identify and explain the relevance of each of the non-GAAP measures presented in Management’s Discussion & Analysis, show how they are calculated and present a reconciliation to the most directly comparable measure defined under IFRS. We do not regard these non-GAAP measures as a substitute for, or superior to, the equivalent measures defined under IFRS. The non-GAAP measures that we use may not be directly comparable with similarly-titled measures used by other companies.

The statements in the discussion and analysis regarding industry outlook, our expectations regarding the performance of our business and the forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in “Risk Factors” and “Disclosure Regarding Forward-Looking Statements.” Our actual results may differ materially from those contained in or implied by any forward-looking statements. You should read the following discussion together with the sections entitled “Risk Factors,” “Unaudited Pro Forma Financial Information,” “Selected Historical Financial Information” and the historical audited consolidated financial statements, including the related notes, appearing elsewhere in this prospectus.

OVERVIEW

Our Business

We are a diversified global engineering and manufacturing company with a portfolio of market-leading businesses. Our products are highly engineered and used in the industrial, automotive and construction end markets. We have a broad collection of premier brands that are among the most globally recognized in their respective end markets, and we estimate that approximately 80% of our pro forma sales for Fiscal 2010 were derived from businesses that hold the number one position in the markets in which they operate. Approximately 38% of our Fiscal 2010 pro forma sales were generated from the global industrial replacement end market and automotive aftermarket,

 

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where we achieve higher margins. Our industrial replacement business provides us with exposure to a broad range of industrial end market segments that have an ongoing need for replacement parts, while the automotive aftermarket provides us with a stable source of revenue. The significant majority of our products, including those useful for the reduction of energy consumption and for safety improvement, are positioned in the premium end of their respective end markets. The prices of our products are low relative to the potential cost of their failure within the critical systems in which they are used, such as industrial machinery, automotive engines and HVAC systems. We attribute our end market leadership positions to a combination of our brand strength, product quality and breadth, and customer service and support. We are led by an experienced, proven management team that has successfully streamlined our portfolio to focus on our core businesses, and implemented wide-ranging, significant cost-saving restructuring initiatives.

Effect of the Acquisition

As a result of the Acquisition and the application of purchase accounting, certain of our assets and liabilities were adjusted to their fair values on the date of the Acquisition. These adjusted valuations will result in additional depreciation and amortization in the Successor periods.

Specifically, we anticipate an increase in our cost of sales due to the increased carrying value of our property, plant and equipment and an increase in our administrative expenses due to the amortization of our intangible assets. As a result of the Acquisition we have recognized certain intangible assets that we consider have indefinite useful lives and there has been a significant increase in the carrying amount of goodwill compared with the Predecessor periods. Both goodwill and intangible assets with indefinite useful lives are subject to annual impairment testing. See “—Critical Accounting Estimates—Impairment of Long-Lived Assets” and “Unaudited Pro Forma Financial Information.”

Additionally, as discussed below in “—Liquidity and Capital Resources,” we incurred significant indebtedness in connection with the consummation of the Acquisition, including the offering of the initial notes, and our total indebtedness and related interest expenses will be significantly higher than in the Predecessor periods.

Restructuring Initiatives

In response to the adverse economic conditions prevailing during late 2007 and 2008, we launched two major restructuring initiatives during 2008 and 2009, which we refer to as projects Eagle and Cheetah. Project Eagle was launched in early 2008 to reduce our cost base, improve our competitiveness and increase our operating margins. Project Cheetah was launched in early 2009 to refocus our manufacturing footprint towards low-cost and high growth regions and within our most efficient facilities. These projects have had, and are expected to continue to have, a material impact on our results of operations, capital resources and cash flows.

Our Segments

Our revenue and earnings base is highly diversified by product, geography, end market and customer. We derive revenues from nearly every developed country across the globe and are well-positioned in most emerging markets with our industrial and automotive component products.

We are organized for management reporting purposes into two business groups: Industrial & Automotive and Building Products. We distinguish within our continuing operations between those of our operating segments that are ongoing, which we identify as “ongoing segments”, and those that we have exited but do not meet the conditions to be classified as discontinued operations, which we identify as “exited segments.”

 

  •  

Industrial & Automotive manufactures a wide range of systems and components for the industrial OE and replacement end markets, as well as the automotive OE end market and automotive aftermarket throughout the world. I&A is comprised of four ongoing operating segments: Power Transmission, Fluid Power, Sensors & Valves and Other I&A.

 

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  •  

Building Products is comprised of two ongoing operating segments: Air Distribution and Bathware. Air Distribution supplies certain HVAC system components to the non-residential and residential construction end markets, mainly in North America. Bathware manufactures bathtubs and shower enclosures primarily used in residential applications.

During the periods under review, we reported two exited segments: within Industrial & Automotive, the Stant and Standard-Thomson businesses that were sold during in Fiscal 2008 (“Caps & Thermostats”); and within Building Products, the Philips Doors & Windows business that was closed during Fiscal 2009 (“Doors & Windows”).

Highlighting our geographical diversification approximately 37% of our Fiscal 2010 pro forma sales were generated outside North America.

 

     Contribution to Fiscal 2010 Pro Forma Sales  
     North
America		     Europe     Asia     Rest of
World		     Total  

Industrial & Automotive

           

Power Transmission

      18.4 %      12.2 %      10.9 %      2.5 %      44.0 % 

Fluid Power

      10.1 %      2.2 %      1.8 %      2.1 %      16.2 % 

Sensors & Valves

      5.2 %      1.9 %      0.4 %      0.8 %      8.3 % 

Other I&A

      10.0 %      0.1 %      0.2 %      1.0 %      11.3 % 
                                        
     43.7 %      16.4 %      13.3 %      6.4 %      79.8 % 
                                        

Building Products

           

Air Distribution

      16.5 %      0.6 %      0.5 %      0.2 %      17.8 % 

Bathware

      2.4 %      0.0 %      0.0 %      0.0 %      2.4 % 
                                        
     18.9 %      0.6 %      0.5 %      0.2 %      20.2 % 
                                        

Total ongoing operations

      62.6 %      17.0 %      13.8 %      6.6 %      100.0 % 
                                        

Our top ten customers represented only 23% of our Fiscal 2010 pro forma sales. We maintain long-standing customer relationships and have served our top 20 customers for an average of over 35 years, while some of our largest customer relationships span over 50 years. We have also developed strong relationships with industry-leading customers in emerging markets.

Our product portfolio consists of tens of thousands of SKUs, and we believe it comprises the broadest range of power transmission belts, fluid power hoses and air distribution products in the end markets in which we operate. This breadth, combined with our brand reputation, product quality, superior field sales and service support, long-standing customer relationships and ability to deliver on short lead times, has allowed us to establish and maintain our leading market positions.

Highlighting the diversity of our end markets, our Fiscal 2010 pro forma sales analyzed by end market were as follows:

 

$ in millions

    Industrial
Original
Equipment		      Industrial
replacement		      Automotive
aftermarket		      Automotive
Original
Equipment		      Non-residential      Residential      Other(1)      Total  

Industrial & Automotive:

                        

Power Transmission

      216.4         328.1         712.9         879.3         —           —           —           2,136.7   

Fluid Power

      240.7         388.6         153.6         1.6         —           —           —           784.5   

Sensors & Valves

      18.0         0.0         74.0         310.2         —           —           —           402.2   

Other I&A

      251.5         92.0         91.3         16.6         —           —           97.4         548.8   
                                                                       
     726.6         808.7         1,031.8         1,207.7         —           —           97.4         3,872.2   
                                                                       

Building Products:

                        

Air Distribution

      —           —           —           —           638.4         224.5         —           862.9   

Bathware

      —           —           —           —           —           114.4         4.4         118.8   
                                                                       
     —           —           —           —           638.4         338.9         4.4         981.7   
                                                                       

Total operations

      726.6         808.7         1,031.8         1,207.7         638.4         338.9         101.8         4,853.9   
                                                                       

 

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(1) Other includes manufactured housing and recreational vehicles

Recent Industry Trends

Industrial & Automotive

Industrial end markets accounted for 39.6% of I&A’s Fiscal 2010 pro forma sales, with 18.8% to the industrial OE end market and 20.9% to the industrial replacement end market. U.S. industrial production, as measured by the U.S. Federal Reserve Industrial Production index, continued to improve throughout 2010 and was on average 6% higher than 2009. The industrial OE end market and replacement end markets improved during 2010 due to increased industrial activity that led to an increase in demand for our products and some restocking by our customers. The European market followed a similar trend, with industrial production steadily increasing through 2010. Asia continued to perform strongly during 2010, although there were signs of some slowdown in the rate of growth in the Chinese and Japanese markets. We do not expect the recent earthquake in Japan to have a significant adverse effect on our activities in Japanese markets.

The automotive aftermarket, which comprised 26.6% of I&A’s Fiscal 2010 pro forma sales increased in all of the regions in which we operate but particularly in Asia, due to growth in end user demand and the increased number of cars in use. In the automotive OE market, which accounted for 31.2% of I&A’s Fiscal pro forma 2010 sales, volumes in Fiscal 2010 were higher as a result of an improvement in the global automotive markets and weak comparable figures during Fiscal 2009, especially in North America. According to IHS/CSM, global automotive production was up 24% in 2010 compared with 2009, with volumes in North America up 39% and volumes in Europe up 14%, driven mainly by export demand and stimulus programs within Europe.

Building Products

Non-residential construction in North America accounted for 65.0% of Building Products’ Fiscal 2010 pro forma sales. According to Dodge, in the United States, non-residential construction starts declined on a square foot basis by 16% in 2010 compared with 2009, and by 8% on a value basis. The U.S. Architectural Billings Index, which is regarded as a leading indicator of future commercial construction activity, remained under 50 for most of 2010, indicating a continued contraction in construction activity for at least the next nine to 12 months.

Residential construction in North America accounted for 34.6% of Building Products’ Fiscal 2010 pro forma sales. The U.S. residential construction market, as measured by housing starts, remained broadly flat for the majority of the first half of 2010 but declined in May and June 2010 following the expiration on April 30, 2010 of federal tax credits designed to stimulate housing sales. Housing starts remained low for most of the rest of the year, as a result of high unemployment, tighter restrictions on mortgage lending and the high inventory of unsold homes. According to the U.S. Census Bureau, year-end housing inventories for new and existing homes were at 6.9 months and 8.1 months respectively. These figures are still above the 10-year averages (6.0 months for new homes and 5.9 months for existing homes), implying limited potential increase in construction activity for the near future. Housing sales were also impacted by the poor economic conditions, with new and existing home sales falling by 8% and 3% respectively in 2010 compared with 2009, as measured by the U.S. Census Bureau.

 

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RESULTS OF OPERATIONS

Fiscal 2010 compared with Fiscal 2009

Group summary

 

$ in millions    Successor
Q4 2010		                 Predecessor
9M 2010		     Pro Forma
Adjustments		     Pro Forma
Fiscal 2010		     Predecessor
Fiscal 2009		  

Continuing operations

               

Sales

      1,289.2           3,564.7       —          4,853.9       4,180.1  

Cost of sales

      (1,038.1 )          (2,437.7 )      113.0       (3,362.8 )      (2,995.9 ) 
                                            

Gross profit

      251.1           1,127.0       113.0       1,491.1       1,184.2  

Distribution costs

      (144.6 )          (382.4 )      —          (527.0 )      (464.8 ) 

Administrative expenses

      (230.8 )          (358.2 )      (97.1 )      (686.1 )      (480.4 ) 

Transaction costs

      (78.2 )          (41.5 )      119.1       (0.6 )      —     

Impairments

      —              —          —          —          (73.0 ) 

Restructuring costs

      (2.0 )          (10.0 )      —          (12.0 )      (144.1 ) 

Net gain on disposals and on the exit of businesses

      —              6.3       —          6.3       0.2  

Gain on amendment of post-employment benefits

      —              —          —          —          63.0  

Share of profit/(loss) of associates

      0.7           (1.3 )      —          (0.6 )      (0.4 ) 
                                            

Operating (loss)/profit

      (203.8 )          339.9       135.0        271.1       84.7  
 

Interest expense

      (90.9 )          (71.8 )      (198.7 )      (361.4 )      (113.2 ) 

Investment income

      18.7           48.2       —          66.9       67.2  

Other finance (expense)/income

      (27.1 )          (2.7 )      55.1       25.3       (0.3 ) 

Net finance costs

      (99.3 )          (26.3 )      (143.6 )      (269.2 )      (46.3 ) 
                                            

(Loss)/profit before tax

      (303.1 )          313.6       (8.6 )      1.9       38.4  
                                            

Sales

Sales from continuing operations were $1,289.2 million in Q4 2010 and were $3,564.7 million in 9M 2010. Pro forma sales for Fiscal 2010 were $4,853.9 million, compared with $4,180.1 million for Fiscal 2009, an increase of 16.1%. Most of our end markets strengthened during the period, which caused a corresponding increase in sales volumes across our businesses. Acquisitions made during the period, in particular the acquisition of Koch Filter Corporation in February 2010, increased Fiscal 2010 pro forma sales by $52.8 million compared with Fiscal 2009. Fiscal 2010 pro forma sales also benefited by $23.7 million compared with Fiscal 2009 from changes in average currency exchange rates. However, Fiscal 2010 pro forma sales included no contribution from Doors & Windows, an exited segment that contributed sales of $36.5 million prior to its closure during Fiscal 2009. Excluding the impact of acquisitions, the closure of Doors & Windows and exchange rate movements, Fiscal 2010 pro forma sales rose by $633.8 million, or 15.3%, compared with Fiscal 2009.

Cost of Sales

Cost of sales was $1,038.1 million in Q4 2010 and $2,437.7 million in 9M 2010. Pro forma cost of sales for Fiscal 2010 was $3,362.8 million compared with $2,995.9 million for Fiscal 2009, an increase of 12.2% that was driven principally by higher production volumes and the effect of accounting for the Acquisition.

Production volumes increased significantly in the I&A businesses in response to the sales growth experienced during Fiscal 2010 compared with Fiscal 2009, but these increases were slightly offset by reduced volumes in the Building Products businesses due to the continued weakness in North American construction end markets. Production cost savings resulted from our restructuring initiatives, particularly in the Power Transmission and Fluid Power segments. During Fiscal 2010, we also benefited from decreases in certain material costs, but incurred marginally higher labor costs.

Pro forma cost of sales for Fiscal 2010 includes an additional depreciation expense of $42.7 million due to the fair value uplift to the carrying amount of the property, plant and equipment held by Tomkins at the date of the Acquisition.

Gross Profit

Gross profit was $251.1 million in Q4 2010 and $1,127.0 million in 9M 2010. Pro forma gross profit for Fiscal 2010 was $1,491.1 million compared with $1,184.2 million for Fiscal 2009.

 

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Our gross profit margin was 19.5% in Q4 2010, significantly down compared with the 9M 2010 margin of 31.6% as a result of the purchase accounting adjustments included in cost of sales. Pro forma gross profit margin for Fiscal 2010 was 30.7%, broadly in line with the gross profit margin for 9M 2010, and slightly higher than the gross profit margin of 28.3% achieved in Fiscal 2009, principally due to the production cost savings.

Distribution Costs

Distribution costs recognized during Q4 2010 were $144.6 million and were $382.4 million during 9M 2010. Pro forma distribution costs for Fiscal 2010 were $527.0 million compared with $464.8 million for Fiscal 2009, an increase of 3.4 % that was broadly commensurate with the increase in sales volumes. Efficiency gains in I&A drove the slight improvement in distribution costs as a percentage of sales, from 11.1% of sales in Fiscal 2009 to 10.9% on a pro forma basis in Fiscal 2010.

Administrative Expenses

Administrative expenses recognized during Q4 2010 were $230.8 million and were $358.2 million during 9M 2010. Pro forma administrative expenses for Fiscal 2010 were $686.1 million, compared with $480.4 million for Fiscal 2009, an increase of $205.7 million that was related principally share-based incentives and the effect of accounting for the Acquisition. Administrative expenses as a percentage of sales increased from 11.5% in Fiscal 2009 to 14.1% on a pro forma basis in Fiscal 2010.

Pro forma administrative expenses for Fiscal 2010 include a compensation expense of $80.1 million in relation to share-based incentives, a significant increase compared with the compensation expense of $11.3 million that was recognized during Fiscal 2009 which is principally due to the new share schemes that were put in place after the Acquisition.

Pro forma administrative expenses for Fiscal 2010 include an additional amortization expense of $141.9 million due to the fair value uplift to the carrying amount of the identifiable intangible assets held by Tomkins at the date of the Acquisition.

Transaction Costs

Transaction costs recognized in relation to acquisitions were $78.2 million during Q4 2010 and were $41.5 million during 9M 2010. Pro forma transaction costs for Fiscal 2010 amounted to $0.6 million, principally in relation to the acquisition of Koch Filter Corporation in February 2010. Acquisition-related costs incurred by us in relation to businesses acquired before January 3, 2010 were not expensed but were included in the cost of acquisition.

Impairments

We recognized no impairment of long-lived assets during Fiscal 2010.

During Fiscal 2009, we recognized impairments amounting to $73.0 million, comprising $18.9 million on goodwill and intangible assets arising on acquisitions, $38.6 million on assets that became impaired as a consequence of our restructuring initiatives and $15.5 million on receivables held in relation to the disposal of businesses in previous years.

Restructuring Costs

We recognized restructuring costs of $2.0 million during Q4 2010 and $10.0 million during 9M 2010 in connection with projects Eagle and Cheetah. In both periods, the costs related principally to the cessation of certain of Power Transmission’s manufacturing facilities in North America and were partially offset by gains on various asset disposals.

 

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During Fiscal 2009, we recognized restructuring costs of $144.1 million. I&A recognized restructuring costs of $117.0 million, which principally related to the cessation of Power Transmission’s manufacturing operations in Aachen, Germany, the rationalization of its powder metal facility at Mississauga, Ontario, and the closures of its pulley and tensioner facility at London, Ontario, and FormFlo in the U.K.; the cessation of Fluid Power’s hose manufacturing activities in Erembodegem, Belgium and the substantial closure of its assembly facility at St. Neots, U.K.; and, in Other I&A, the closure of Ideal’s manufacturing facility at St. Augustine, Florida and the rationalization of Dexter’s manufacturing facilities. Building Products recognized restructuring costs of $26.6 million, which principally related to the closure of the Philips Doors and Windows business.

Net Gain on Disposals and on the Exit of Businesses

During Q4 2010, we recognized no gain or loss on the disposal or exit of businesses. During 9M 2010, we recognized a net gain of $9.6 million on the disposal of property, plant and equipment, principally in Building Products as a consequence of the restructuring of Bathware and the closure of Doors & Windows. This net gain was offset by an additional loss of $3.3 million on the disposal of a subsidiary that took place in Fiscal 2008 and a loss on the disposal of Hydrolink’s operations in Kazakhstan.

During Fiscal 2009, we recognized a net gain of $0.2 million in relation to the disposal of businesses in prior years.

Gain on Amendment of Post-Employment Benefits

During Fiscal 2009, we recognized a one-off gain of $63.0 million on the amendment of post-employment benefit plans in North America.

Operating profit

During Q4 2010 we incurred an operating loss of $203.8 million but during 9M 2010 we recognized an operating profit of $339.9 million. Pro forma operating profit for Fiscal 2010 was $271.1 million, compared with an operating profit of $84.7 million for Fiscal 2009.

Adjusted EBITDA

Adjusted EBITDA was $191.2 million for Q4 2010 and $543.4 million for 9M 2010. Pro forma adjusted EBITDA for Fiscal 2010 was $732.9 million, an increase of $285.2 million over the adjusted EBITDA for Fiscal 2009 of $447.7 million that was due largely to the effect of increased sales volumes and the benefits of our restructuring initiatives. Our pro forma adjusted EBITDA margin was 15.1% for Fiscal 2010, compared with our EBITDA margin of 10.7% for Fiscal 2009.

A reconciliation of operating profit or loss for the period to adjusted EBITDA for each of the periods under review is presented under the heading “—Non-GAAP Measures.”

Interest Expense

 

$ in millions    Successor
Q4 2010		                  Predecessor
9M 2010		     Pro Forma
Adjustments		     Pro Forma
Fiscal  2010		      Predecessor
Fiscal 2009		  

Bank overdrafts

      —               6.0       —          6.0         4.6  

Term loans

      38.4             —          120.1        158.5         —     

Other bank loans

      —               0.5       1.5        2.0         6.1  

Second Lien Notes

      27.9             —          83.8        111.7         —     

2011 Notes

      1.9             13.3       (8.5 )      6.7         19.9  

2015 Notes

      3.3             17.2       (18.9 )      1.6         24.8  

Net interest on interest rate swaps

      —               (19.0 )      19.0        —           (20.2 ) 
                                              
     71.5             18.0       197.0        286.5         35.2  

Finance leases

      —               0.2       —          0.2         0.4  

Other

      4.0             3.2       1.7        8.9         7.6  
                                              
     75.5             21.4       198.7        295.6         43.2  

Post-employment benefits:

                 —        

– Interest on benefit obligation

      15.4             50.4       —          65.8         70.0  
                                              
     90.9             71.8       198.7        361.4         113.2  
                                              

 

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Interest expense was $90.9 million in Q4 2010 and $71.8 million in 9M 2010. Pro forma interest expense was $361.4 million for Fiscal 2010 compared with $113.2 million for Fiscal 2009, the increase being due largely to the additional borrowings that were drawn down to finance the Acquisition.

At the beginning of Q4 2010, we borrowed $2,000.0 million by way of floating rate term loans issued under the senior secured credit facilities and issued $1,150.0 million 9% Senior Secured Second Lien Notes that mature on October 1, 2018 to finance the Acquisition. We recognized a pro forma interest expense of $270.2 million on these additional borrowings during Fiscal 2010.

When it was acquired, Tomkins had the following notes outstanding under a Euro Medium Term Note Programme: £150 million 8% notes repayable at par on December 20, 2011 (the “2011 Notes”); and £250 million 6.125% notes repayable at par on September 16, 2015 (the “2015 Notes”). During Q4 2010, as a result of our tender offer and the triggering of a put option held by the lenders, the principal amount outstanding on the 2011 Notes was reduced from £150.0 million to £102.1 million and the principal amount outstanding on the 2015 Notes was reduced from £250.0 million to £17.2 million. As a result, the pro forma interest expense in relation to the 2011 Notes and the 2015 Notes was $8.3 million in Fiscal 2010 compared with $44.7 million in Fiscal 2009.

Prior to the Acquisition, Tomkins held interest rate swaps to swap the 2011 Notes and the 2015 Notes from fixed interest rates to floating interest rates. During 9M 2010, these interest rate swaps had the effect of reducing our interest expense by $19.0 million (Fiscal 2009: $20.2 million). On September 16, 2010, these interest rate swaps were sold in anticipation of the Transactions. Accordingly, their beneficial effect was eliminated in arriving at the pro forma interest expense for Fiscal 2010.

In Fiscal 2010, interest on the benefit obligations of our defined benefit and post-employment heath care plans was $65.8 million, $4.2 million lower than in Fiscal 2009 due to the decline in market interest rates during Fiscal 2010.

Investment Income

 

$ in millions    Successor
Q4 2010		                  Predecessor
9M 2010		      Pro Forma
Adjustments		      Pro Forma
Fiscal 2010		      Predecessor
Fiscal 2009		  

Bank deposits

      1.3             2.4         —           3.7         2.7   

Other

      1.1             1.1         —           2.2         1.9   
                                                
     2.4             3.5         —           5.9         4.6   
 

Post-employment benefits:

                —           

– Expected return on plan assets

      16.3             44.7         —           61.0         62.6   
                                                
     18.7             48.2         —           66.9         67.2   
                                                

Investment income was $18.7 million in Q4 2010 and $48.2 million in 9M 2010. Pro forma investment income was $66.9 million in Fiscal 2010 compared with $67.2 million in Fiscal 2009. Interest earned on bank and other deposits was higher during Fiscal 2010 compared with Fiscal 2009 due principally to the higher average interest-bearing cash balances. However, the higher interest income was outweighed by the effect during the period of the lower expected return on the assets held by our defined benefit pension plans at the beginning of Fiscal 2010 compared with at the beginning of Fiscal 2009.

 

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Other Finance (Expense)/Income

 

$ in millions    Successor
Q4 2010		                 Predecessor
9M 2010		     Pro forma
adjustments
$ in millions		      Pro forma
Fiscal 2010
$ in millions		      Predecessor
Fiscal 2009		  

Loss/(gain) on derivatives held for hedging purposes

      —              (1.7 )      1.7         —           1.3  

Translation (loss)/gain on hedging instruments

      (1.5 )          (1.0 )      4.9         2.4        (1.6 ) 

Gain on embedded derivatives

      22.9           —          —           22.9        —     

Translation loss on the Acquisition

      (47.6 )          —          47.6         —           —     

Loss on redemption of notes

      (0.9 )          —          0.9         —           —     
                                              
     (27.1 )          (2.7 )      55.1         25.3        (0.3 ) 
                                                          

Other finance expense was $27.1 million in Q4 2010 and $2.7 million in 9M 2010. Pro forma other finance income was $25.3 million in Fiscal 2010 compared with an expense of $0.3 million in Fiscal 2009.

Prior to the Acquisition, Tomkins had designated as fair value hedges in relation to the 2011 Notes and the 2015 Notes the interest rate swaps that it held to swap the interest payable on the notes from fixed to floating rates. During 9M 2010, Tomkins recognized a loss of $1.7 million in other finance expense because there was deemed to be ineffectiveness in the hedging relationship for accounting purposes. As the interest rate swaps were sold in anticipation of the Transactions, we have eliminated that loss in arriving at pro forma other finance income for Fiscal 2010. During Fiscal 2009, we recognized a gain of $1.3 million due to hedge ineffectiveness of the interest rate swaps.

Other finance expense included a currency translation loss on hedging instruments of $1.5 million in Q4 2010 and $1.0 million in 9M 2010. In arriving at pro forma other finance income for Fiscal 2010, we have eliminated a net currency translation loss of $4.9 million which was attributable to the translation of the 2011 Notes and the 2015 Notes and to the interest rate swaps that were designated as fair value hedges in relation to them. Accordingly, pro forma other finance income for Fiscal 2010 includes a net currency translation gain of $2.4 million on hedging instruments compared with a net currency translation loss of $1.6 million that was included in other finance expense for Fiscal 2009.

Borrowings against the senior secured credit facilities that were drawn down to finance the Acquisition bear interest at floating rates, subject to a floor (an embedded interest rate derivative that was required to be recognized separately from the term loans). During Q4 2010, we recognized a gain of $22.9 million due to the change in the fair values of the embedded interest rate derivatives as a credit to other finance expense.

During Q4 2010, we incurred a currency translation loss of $47.6 million on the Acquisition due to the change in the rate of exchange between Sterling (in which the purchase consideration was denominated) and the U.S. dollar (the functional currency of the acquiring entity), in the period between the effective date of the Acquisition and the payment of the consideration to the former shareholders in Tomkins. Also during Q4 2010, we incurred a loss of $0.9 million on repayments of the 2011 Notes and the 2015 Notes. As these losses represented non-recurring effects of the Transactions, they were eliminated in arriving at pro forma other finance income for Fiscal 2010.

Income Tax Benefit/(Expense)

We recognized an income tax benefit of $32.9 million on a loss before tax of $303.1 million in Q4 2010 and an income tax expense of $62.8 million on a profit before tax of $313.6 million in 9M 2010. For Fiscal 2010, the pro forma income tax benefit was $29.1 million on the pro forma profit before tax of $16.3 million, compared with the income tax expense of $28.5 million that we recognized on the profit before tax of $38.4 million in Fiscal 2009.

Discontinued Operations

During Fiscal 2010, we recognized additional losses of $7.2 million (Fiscal 2009: $3.9 million) in relation to businesses sold in previous years that were classified as discontinued operations.

 

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Analysis by Ongoing Business Segment

In the discussion below, each segment’s pro forma sales for Fiscal 2010 are equal to the sum of the actual sales for the Predecessor and Successor periods in Fiscal 2010.

Industrial & Automotive

Power Transmission

 

$ in millions, unless otherwise stated    Successor
Q4 2010		     Predecessor
9M 2010		     Pro Forma
Adjustments		     Pro Forma
Fiscal 2010		     Predecessor
Fiscal 2009		     Pro Forma
Fiscal 2010  vs
Fiscal 2009
% Change		  

Sales

      580.8       1,555.9       —          2,136.7       1,763.4       21.2 % 

Operating (loss)/profit

      (21.1 )      253.1       (22.2 )      209.8       142.8    

Adjusted EBITDA

      115.2       318.2       0.1       433.5       295.8    

Adjusted EBITDA margin

      19.8 %      20.5 %        20.3 %      16.8 %   

Pro forma sales in our Power Transmission segment were $2,136.7 million for Fiscal 2010 compared with $1,763.4 million for Fiscal 2009, an increase of 21.2%, that was due primarily to further strengthening of all of our end markets, particularly the industrial end markets. Sales to the industrial OE and replacement markets (together 25.5% of Power Transmission’s Fiscal 2010 pro forma sales) grew by 33.0% compared with Fiscal 2009, because of improved demand. Sales to the automotive OE market (41.1% of Power Transmission’s Fiscal 2010 pro forma sales), were up by 27.1% during Fiscal 2010 compared with Fiscal 2009, driven by strong growth in North America and China. In North America, this growth was due to the unprecedentedly low sales volumes in the prior year as a result of extended plant shutdowns and significantly depressed sales by automotive OE manufacturers (“OEMs”), including the Chapter 11 restructurings of General Motors and Chrysler. Sales to the higher margin automotive aftermarket (33.4% of Power Transmission’s Fiscal 2010 pro forma sales) continued to perform well, increasing by 7.7% compared with Fiscal 2009 due to increased demand by end users driven by the increased size and age of the global vehicle population, the greater number of miles driven, and, additionally in China, government subsidies.

We incurred an operating loss in our Power Transmission segment of $21.1 million for Q4 2010, but the segment recognised an operating profit of $253.1 million for 9M 2010. Pro forma operating profit was $209.8 million for Fiscal 2010, an increase of $67.0 million compared with Fiscal 2009. Pro forma depreciation and pro forma amortization amounted to $212.0 million in Fiscal 2010 compared with $81.8 million in Fiscal 2009, the increase being due principally to the purchase accounting uplift to the carrying amounts of the relevant long-lived assets. In Fiscal 2010, the pro forma compensation expense in respect of share-based incentives was $6.7 million compared with $2.1 million in Fiscal 2009. While there was no impairment of long-lived assets recognized in Fiscal 2010, Power Transmission recognized impairments of $23.2 million in Fiscal 2009. In Fiscal 2010, pro forma restructuring costs were $9.0 million compared with $75.6 million for Fiscal 2009. In Fiscal 2009, Power Transmission recognized a one-off gain of $29.7 million on the amendment of our post-employment benefit plans in North America.

Adjusted EBITDA in our Power Transmission segment was $115.2 million for Q4 2010 and $318.2 million for 9M 2010. Pro forma adjusted EBITDA was $433.5 million for Fiscal 2010 compared with $295.8 million for Fiscal 2009, an increase of 46.6% that was due principally to higher volumes in Fiscal 2010 and the effects of our restructuring initiatives. Power Transmission’s adjusted EBITDA margin increased to 20.3% on a pro forma basis in Fiscal 2010 compared with 16.8% in Fiscal 2009.

Fluid Power

 

$ in millions, unless otherwise stated    Successor
Q4 2010		     Predecessor
9M 2010		     Pro Forma
Adjustments		      Pro Forma
Fiscal 2010		     Predecessor
Fiscal 2009		     Pro Forma
Fiscal 2010  vs
Fiscal 2009
% Change		  

Sales

      215.4       569.1       —           784.5       588.7       33.3 % 

Operating (loss)/profit

      (19.5 )      45.3       27.2        53.0       (22.7 )   

Adjusted EBITDA

      27.6       73.2       0.2        101.0       18.8    

Adjusted EBITDA margin

      12.8 %      12.9 %         12.9 %      3.2 %   

 

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Pro forma sales in our Fluid Power segment were $784.5 million for Fiscal 2010 compared with $588.7 million for Fiscal 2009, an increase of 33.3%. Sales to the industrial replacement market (49.5% of Fluid Power’s Fiscal 2010 pro forma sales) were up by 33.1% compared with Fiscal 2009 due to increased utilization of industrial equipment driven by the economic recovery, particularly in North America. Sales to the industrial OE market (30.7% of Fluid Power’s Fiscal 2010 pro forma sales) were up by 49.9% in Fiscal 2010 compared with Fiscal 2009, due to the continued recovery in all of our regional end markets.

Sales to the higher margin automotive aftermarket (19.6% of Fluid Power’s Fiscal 2010 pro forma sales) were up by 13.7% globally, due principally to the improved economic conditions.

We incurred an operating loss in our Fluid Power segment of $19.5 million for Q4 2010, but the segment recognized an operating profit for 9M 2010 of $45.3 million. Pro forma operating profit was $53.0 million for Fiscal 2010 compared with an operating loss of $22.7 million for Fiscal 2009. Pro forma depreciation and pro forma amortization amounted to $42.9 million in Fiscal 2010 compared with $33.7 million in Fiscal 2009, the increase being due principally to the purchase accounting uplift to the carrying amounts of the relevant long-lived assets. In Fiscal 2010, the pro forma compensation expense in respect of share-based incentives was $3.9 million compared with $0.7 million in Fiscal 2009. While there was no impairment of long-lived assets recognized in Fiscal 2010, Fluid Power recognized impairments of $12.5 million in Fiscal 2009. In Fiscal 2010, restructuring costs were $1.4 million compared with $26.0 million for Fiscal 2009. In Fiscal 2009, Fluid Power recognized a one-off gain of $31.4 million on the amendment of our post-employment benefit plans in North America.

Adjusted EBITDA in our Fluid Power segment was $27.6 million for Q4 2010 and $73.2 million for 9M 2010. Pro forma adjusted EBITDA was $101.0 million for Fiscal 2010 compared with $18.8 million for Fiscal 2009, the improvement being due principally to the increased sales volumes and the effects of our restructuring initiatives. Fluid Power’s adjusted EBITDA margin improved significantly to 12.9% on a pro forma basis in Fiscal 2010 compared with 3.2% in Fiscal 2009.

Sensors & Valves

 

$ in millions, unless otherwise stated    Successor
Q4 2010		     Predecessor
9M 2010		     Pro Forma
Adjustments		    Pro Forma
Fiscal 2010		    Predecessor
Fiscal 2009		     Pro Forma
Fiscal 2010  vs
Fiscal 2009
% Change		  

Sales

      107.9       294.3       —        402.2      313.6       28.3 % 

Operating profit/(loss)

      0.5       26.7       (2.5 )    24.7      (3.4 )   

Adjusted EBITDA

      17.4       44.5       —        61.9      25.6    

Adjusted EBITDA margin

      16.1 %      15.1 %      15.4%      8.2 %   

Pro forma sales in our Sensors & Valves segment were $402.2 million for Fiscal 2010 compared with $313.6 million for Fiscal 2009, an increase of 28.3%, that was primarily the result of the higher product volumes demanded by the automotive OE market (which comprised 77.1% of Sensors & Valves’ Fiscal 2010 pro forma sales), particularly in North America and Asia. During Fiscal 2009, extended plant shutdowns, which were particularly extensive in the North American automotive OE end market (particularly during the Chapter 11 restructurings of General Motors and Chrysler), and significantly depressed sales by automotive OEMs, affected sales levels at the Schrader Electronics business. Schrader International’s automotive aftermarket business, which accounts for the remainder of Sensors & Valves’ sales, grew as a result of improving conditions in those markets compared with Fiscal 2009.

Our Sensors & Valves segment recognized an operating profit of $0.5 million for Q4 2010 and $26.7 million for 9M 2010. Pro forma operating profit was $24.7 million for Fiscal 2010 compared with an operating loss of $3.4 million for Fiscal 2009. Pro forma depreciation and pro forma amortization amounted to $36.8 million in Fiscal 2010 compared with $25.0 million in Fiscal 2009, the increase being due principally to the purchase accounting uplift to the carrying amounts of the relevant long-lived assets. In Fiscal 2010, the pro forma compensation expense in respect of share-based incentives was $3.0 million compared with $0.8 million in Fiscal 2009. A release of $1.7 million of the provision for restructurings was recognized in Fiscal 2010 compared with an expense of $3.2 million for Fiscal 2009.

 

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Adjusted EBITDA in our Sensors & Valves segment was $17.4 million for Q4 2010 and $44.5 million for 9M 2010. Pro forma adjusted EBITDA was $61.9 million for Fiscal 2010 compared with $25.6 million for Fiscal 2009, with the improvement being due principally to higher sales volumes to the North American automotive OE market. Sensors & Valves’ adjusted EBITDA margin improved to 15.4 % on a pro forma basis in Fiscal 2010 compared with 8.2% in Fiscal 2009.

Other Industrial & Automotive

 

$ in millions, unless otherwise stated    Successor
Q4 2010		     Predecessor
9M 2010		     Pro Forma
Adjustments		      Pro Forma
Fiscal 2010		     Predecessor
Fiscal 2009		     Pro Forma
Fiscal 2010  vs
Fiscal 2009
% Change		  

Sales

      131.3       417.5       —           548.8        463.4       18.4 % 

Operating (loss)/profit

      (22.6 )      42.4       12.4        32.2        13.8    

Adjusted EBITDA

      15.9       55.2       —           71.1        41.6    

Adjusted EBITDA margin

      12.1 %      13.2 %         13.0 %      9.0 %   

Pro forma sales in our Other I&A segment were $548.8 million for Fiscal 2010 compared with $463.4 million for Fiscal 2009, an increase of 18.4%. The industrial and utility trailer markets (62.6% of Other I&A’s Fiscal 2010 pro forma sales) increased over the prior year as industrial demand began to recover from the depressed levels experienced in Fiscal 2009. Approximately 90% of the Fiscal 2010 sales to these end markets were made to the recovering North American markets. The recreational vehicle end market (16.6% of Other I&A’s Fiscal 2010 pro forma sales) also grew strongly in North America primarily due to customer restocking, particularly in the first half of Fiscal 2010, improving by 41.6% during Fiscal 2010 compared with Fiscal 2009.

We incurred an operating loss in our Other I&A segment of $22.6 million for Q4 2010, but the segment recognized an operating profit for 9M 2010 of $42.4 million. Pro forma operating profit was $32.2 million for Fiscal 2010 compared with $13.8 million for Fiscal 2009. In Fiscal 2010, the pro forma compensation expense in respect of share-based incentives was $10.9 million compared with $0.5 million in Fiscal 2009. Pro forma depreciation and pro forma amortization amounted to $26.7 million in Fiscal 2010 compared with $16.4 million in Fiscal 2009, the increase being due principally to the purchase accounting uplift to the carrying amounts of the relevant long-lived assets. In Fiscal 2010, restructuring costs were $1.1 million compared with $12.2 million for Fiscal 2009.

Adjusted EBITDA in our Other I&A segment was $15.9 million for Q4 2010 and $55.2 million for 9M 2010. Pro forma adjusted EBITDA was $71.1 million for Fiscal 2010 compared with $41.6 million for Fiscal 2009, the improvement being due principally to higher sales volumes and the effects of our restructuring initiatives. Other I&A’s adjusted EBITDA margin improved to 13.0% on a pro forma basis in Fiscal 2010 compared with 9.0% in Fiscal 2009.

Building Products

Air Distribution

 

$ in millions, unless otherwise stated    Successor
Q4 2010		     Predecessor
9M 2010		     Pro Forma
Adjustments		      Pro Forma
Fiscal 2010		     Predecessor
Fiscal 2009		     Pro Forma
Fiscal 2010  vs
Fiscal 2009
% Change		  

Sales

      226.7       636.2       —           862.9        874.2       (1.3 )% 

Operating (loss)/profit

      (5.0 )      51.8       0.4        47.2        48.1    

Adjusted EBITDA

      22.6       80.5       0.4        103.5        105.6    

Adjusted EBITDA margin

      10.0 %      12.7 %         12.0 %      12.1 %   

Pro forma sales in our Air Distribution segment were $862.9 million for Fiscal 2010 compared with $874.2 million for Fiscal 2009, a decline of 1.3%. Sales into the non-residential construction markets (74.0% of Air

 

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Distribution’s Fiscal 2010 pro forma sales) rose marginally compared with Fiscal 2009, as the continued decline in North American new build markets was offset by growth in the North American refurbishment market. Sales to the residential construction market (26.0% of Air Distribution’s Fiscal 2010 pro forma sales) declined by 7.2% in Fiscal 2010 compared with Fiscal 2009 due to the continued weakness in the North American residential construction market.

We incurred an operating loss in our Air Distribution segment of $5.0 million for Q4 2010, but the segment recognized an operating profit for 9M 2010 of $51.8 million. Pro forma operating profit was $47.2 million for Fiscal 2010 compared with $48.1 million for Fiscal 2009. Pro forma depreciation and pro forma amortization amounted to $45.9 million in Fiscal 2010 compared with $31.9 million in Fiscal 2009, the increase being due principally to the purchase accounting uplift to the carrying amounts of the relevant long-lived assets. In Fiscal 2010, the pro forma compensation expense in respect of share-based incentives was $7.6 million compared with $1.9 million in Fiscal 2009. While there was no impairment of long-lived assets recognized in Fiscal 2010, Air Distribution recognized impairments of $18.6 million in Fiscal 2009. In Fiscal 2010, restructuring costs were $1.7 million compared with $5.1 million for Fiscal 2009.

Adjusted EBITDA in our Air Distribution segment was $22.6 million for Q4 2010 and $80.5 million for 9M 2010. Pro forma adjusted EBITDA was $103.5 million for Fiscal 2010 compared with $105.6 million for Fiscal 2009, with the slight reduction being due largely to the decline in sales which was offset partially by improved cost efficiencies. Air Distribution’s pro forma adjusted EBITDA margin was slightly lower at 12.0% on a pro forma basis for Fiscal 2010 compared with 12.1% for Fiscal 2009.

Bathware

 

$ in millions, unless otherwise stated    Successor
Q4 2010		     Predecessor
9M 2010		     Pro Forma
Adjustments		     Pro Forma
Fiscal 2010		     Predecessor
Fiscal 2009		     Pro Forma
Fiscal 2010  vs
Fiscal 2009
% Change		  

Sales

      27.1       91.7       —          118.8       140.3       (15.3 )% 

Operating loss

      (4.4 )      (4.1 )      (2.5 )      (11.0 )      (12.8 )   

Adjusted EBITDA

      (1.2 )      (1.7 )      —          (2.9 )      (0.1 )   

Adjusted EBITDA margin

      (4.4 )%      (1.9 )%        (2.4 )%      (0.1 )%   

Pro forma sales in our Bathware segment were $118.8 million for Fiscal 2010 compared with $140.3 million for Fiscal 2009, a decline of 15.3%. Bathware sells primarily to the U.S. residential construction market, which continued to be weak throughout Fiscal 2010 and declined further towards the end of the period.

Our Bathware segment reported an operating loss of $4.4 million for Q4 2010 and $4.1 million for 9M 2010. Pro forma operating loss was $11.0 million for Fiscal 2010 compared with a loss of $12.8 million for Fiscal 2009. Bathware recognized a gain of $3.2 million on the exit and disposal of businesses in Fiscal 2010. Pro forma depreciation and pro forma amortization amounted to $10.7 million in Fiscal 2010 compared with $8.4 million in Fiscal 2009, the increase being due principally to the purchase accounting uplift to the carrying amounts of the relevant long-lived assets. In Fiscal 2009, Bathware recognized restructuring costs of $1.6 million and impairments of $2.5 million.

Adjusted EBITDA in our Bathware segment was a loss of $1.2 million for Q4 2010 and $1.7 million for 9M 2010. Pro forma adjusted EBITDA was a loss of $2.9 million for Fiscal 2010, which was higher than the loss of $0.1 million for Fiscal 2009 due to the continued decline in the residential construction end market during Fiscal 2010.

Corporate

Corporate reported an operating loss of $131.0 million for Q4 2010 and $78.6 million for 9M 2010. Pro forma operating loss was $87.4 million in Fiscal 2010 compared with an operating loss of $48.1 million in Fiscal 2009. In Fiscal 2010, the pro forma compensation expense in respect of share-based incentives was $48.4 million compared with $5.1 million in Fiscal 2009. While there was no impairment of long-lived assets recognized in Fiscal 2010, Corporate recognized impairments of $15.5 million in Fiscal 2009. Corporate also recognized a pro forma management fee payable to the Sponsors of $3.0 million in Fiscal 2010.

 

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Corporate incurred an adjusted EBITDA loss of $6.1 million for Q4 2010 and a loss of $25.8 million for 9M 2010. Pro forma adjusted EBITDA was a loss of $34.3 million for Fiscal 2010 compared with a loss of $26.7 million for Fiscal 2009.

Fiscal 2009 Compared with Fiscal 2008

Group summary

 

     Fiscal  
$ in millions    2009     2008  

Continuing operations

     

Sales

      4,180.1       5,515.9  

Cost of sales

      (2,995.9 )      (4,023.7 ) 
                

Gross profit

      1,184.2       1,492.2  

Distribution costs

      (464.8 )      (584.5 ) 

Administrative expenses

      (480.4 )      (513.3 ) 

Impairments

      (73.0 )      (342.4 ) 

Restructuring costs

      (144.1 )      (26.0 ) 

Net gain on disposals and on the exit of businesses

      0.2       43.0  

Gain on amendment of post-employment benefits

      63.0       —     

Share of loss of associates

      (0.4 )      (2.1 ) 
                

Operating profit

      84.7       66.9  
                

Interest expense

      (113.2 )      (137.8 ) 

Investment income

      67.2       87.8  

Other finance expense

      (0.3 )      (25.0 ) 
                

Net finance costs

      (46.3 )      (75.0 ) 
                

Profit before tax

      38.4       8.1  
                

Sales

Sales from continuing operations were $4,180.1 million for Fiscal 2009 compared with $5,515.9 million for Fiscal 2008, a decline of 24.2%. Most of our end markets experienced significant weakening, particularly in the first half of 2009, which caused a corresponding decline in sales volumes across our businesses. Sales fell by $247.4 million for Fiscal 2009 compared with Fiscal 2008 due to changes in average currency exchange rates. Sales were also reduced by $79.5 million for Fiscal 2009 due to the disposal of two non-core businesses in Fiscal 2008, but this was partially offset by the contribution of recent acquisitions made in Fiscal 2009 which added $26.4 million to sales for Fiscal 2009 compared with Fiscal 2008.

Cost of Sales

Cost of sales was $2,995.9 million for Fiscal 2009 compared with $4,023.7 million for Fiscal 2008.

During Fiscal 2009, we reduced our production levels in response to declining sales volumes and in order to reduce inventory in support of management’s continuing effort to control working capital levels. Also during Fiscal 2009, we benefited from reductions in our cost base resulting from projects Eagle and Cheetah. Due to the combination of these factors, raw material, direct labor and other direct costs incurred each declined by more than 30% for Fiscal 2009 compared with Fiscal 2008. Depreciation was 16.4% lower for Fiscal 2009 compared with Fiscal 2008, reflecting the impact of restructuring initiatives during 2009, the impairment of property, plant and equipment that was recognized in Fiscal 2008 and management’s strict control over capital expenditure levels. Other overhead expenses were 24.7% lower for Fiscal 2009 compared with Fiscal 2008 due to the impact of restructuring initiatives during Fiscal 2009.

 

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Gross Margin

Gross margin increased from 27.1% for Fiscal 2008 to 28.3% for Fiscal 2009 due primarily to the reduction of our cost base resulting from projects Eagle and Cheetah, with raw material costs as a percentage of sales decreasing from 42.2% for Fiscal 2008 to 36.4% for Fiscal 2009 and the labor cost base improved from 8.4% of sales for Fiscal 2008 to 7.6% for Fiscal 2009.

Distribution Costs

Distribution costs were $464.8 million for Fiscal 2009 compared with $584.5 million for Fiscal 2008, a decrease of 20.5%. Distribution costs fell in response to lower sales volumes and lower energy costs.

Administrative Expenses

Administrative expenses were $480.4 million for Fiscal 2009 compared with $513.3 million for Fiscal 2008, a decrease of 6.4%. Administrative expenses declined primarily due to headcount reductions, lower property costs and reduced professional and consultancy fees.

Impairments

We recognized impairment charges of $73.0 million for Fiscal 2009, comprising $18.9 million related to goodwill and intangible assets, $38.6 million on assets that had become impaired as a consequence of our restructuring initiatives and $15.5 million on receivables held in connection with the disposal of businesses in prior years.

During Fiscal 2008 impairments were $342.4 million, of which $228.6 million related to goodwill and $113.8 million related to property, plant and equipment, largely as a result of the significant deterioration during 2008 of the North American automotive OE and U.S. residential construction end markets.

Restructuring Costs

During Fiscal 2009, restructuring costs amounted to $144.1 million and primarily related to the restructuring of our manufacturing operations under projects Eagle and Cheetah. During Fiscal 2008, restructuring costs were $26.0 million and these were largely related to the closure of manufacturing facilities and the outsourcing of certain information technology services.

Net Gain on Disposals and on the Exit of Businesses

During Fiscal 2009, we recognized a net gain of $0.2 million in relation to the disposal of businesses in prior years. During Fiscal 2008, we recognized a gain of $43.2 million as a result of the disposal of Stant and Standard-Thomson.

Gain on Amendment of Post-Employment Benefits

Effective September 30, 2009, we closed our principal defined benefit pension plans in the United States and Canada to future service accrual and the deferred pension benefits accrued under those plans were frozen, based on the pensionable salaries of participating employees at that date. In addition, we closed the Gates post-retirement healthcare plan in the United States to employees who had not retired by December 31, 2009 and reduced the benefits payable to existing beneficiaries. As a result of these amendments, we recognized a gain of $63.0 million for Fiscal 2009, of which $35.3 million related to pensions and $27.7 million to healthcare benefits.

Operating Profit

Operating profit was $84.7 million for Fiscal 2009 compared with $66.9 million for Fiscal 2008.

 

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Adjusted EBITDA

Our adjusted EBITDA was $447.7 million for Fiscal 2009 compared with $633.4 million for Fiscal 2008, a decline of 29.3% that was due largely to the effect of reduced sales volumes. Our adjusted EBITDA margin was 10.7% in Fiscal 2009, compared with 11.5% in Fiscal 2008. Although the margin fell in the first half of 2009, it recovered in the second half of 2009, reflecting the effect of improving sales and the reduction in our cost base that resulted from our restructuring initiatives.

A reconciliation of operating profit or loss for the period to adjusted EBITDA for each of the periods under review is presented under the heading “—Non-GAAP Measures.”

Net Finance Costs

Net finance costs were $46.3 million for Fiscal 2009 compared with $75.0 million for Fiscal 2008. Net interest payable on net borrowings was lower at $38.6 million for Fiscal 2009 compared with $47.1 million for Fiscal 2008 due to lower than average net debt and lower average interest rates during Fiscal 2009 compared with Fiscal 2008.

Net finance cost recognized in relation to post-employment benefits was $7.4 million for Fiscal 2009 compared with $2.9 million for Fiscal 2008 and is shown as follows:

 

     Fiscal  
$ in millions    2009     2008  

Interest cost on benefit obligation

    $ 70.0      $ 78.4   

Expected return on plan assets

      (62.6 )      (75.5 ) 
                

Net finance cost

    $ 7.4      $ 2.9   
                

Other finance expense was $0.3 million for Fiscal 2009 compared with $25.0 million for Fiscal 2008. This primarily related to gains and losses on financial instruments held by us to hedge our currency translation exposures that either did not qualify for hedge accounting or in respect of which there was hedge ineffectiveness.

Income Tax Expense

We recognized an income tax expense of $28.5 million on a profit before tax of $38.4 million in Fiscal 2009, compared with an income tax expense of $38.4 million on a loss before tax of $8.1 million in Fiscal 2008.

Discontinued Operations

During Fiscal 2009, we recognized additional losses of $3.9 million (Fiscal 2008: $nil) in relation to businesses sold in previous years that were classified as discontinued operations.

Analysis by Ongoing Business Segment

Industrial & Automotive

Market Background

US industrial production, as measured by the U.S. Federal Reserve Industrial Production index, was down on average 10% in 2009 compared with 2008. The industrial OE and industrial replacement markets were down around 25-35%, due to a combination of declining end customer demand and destocking. In the second half of the year, the markets began to stabilize, with some limited growth, particularly in the industrial replacement markets as demand improved and destocking eased. The European market followed a similar trend, with industrial production down 14%. Following a tough start to 2009, Asia continued to grow, particularly in China, where industrial production was up 12% in 2009. Japan performed poorly, with machine orders down 32% in 2009.

 

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The North American automotive aftermarket, remained broadly flat compared with 2008, assisted by lower gasoline prices in the U.S. and marginally higher car usage (as measured by the U.S. Department of Transport in terms of miles driven). A similar trend was seen in the European and Asian markets.

In the automotive OE market, volumes in the first half of 2009 were affected by extended plant shutdowns and consumer concerns over the viability of some automotive companies, particularly General Motors and Chrysler, who both filed for Chapter 11 protection (the recoverability of our receivables due from these companies was not affected by these filings). Automotive production was down around 30% globally in the first half of 2009 compared with 2008, with volumes in North America down approximately 50% and volumes in Europe down around 34%. Government stimulus plans mitigated the impact of the decline, particularly in Europe and Asia, where the stimulus plans ran for the majority of 2009. In the second half the year, production levels increased compared with the first half, with global volumes up 26%, North American volumes up 46% and European volumes up 13% due to lower inventory levels and higher demand.

Power Transmission

 

$ in millions, unless otherwise stated    Fiscal 2009     Fiscal 2008     Fiscal 2009 vs
Fiscal 2008
% Change		  

Sales

      1,763.4        2,125.2        (17.0 )% 

Operating profit/(loss)

      143.0        (70.6 )   

Adjusted EBITDA

      295.8        333.0     

Adjusted EBITDA margin

      16.8 %      15.7 %   

Sales in our Power Transmission segment were $1,763.4 million for Fiscal 2009 compared with $2,125.2 million for Fiscal 2008, a decline of 17.0%. Adjusted for the effect of adverse currency exchange rate fluctuations, sales declined by $211.2 million compared with Fiscal 2008, primarily as a result of lower volumes in most of the Power Transmission segment’s end markets in the regions in which it operates. Notable exceptions were China, which performed well during 2009, showing double digit percentage growth, and the Gates automotive aftermarket business (38% of Power Transmission’s sales for Fiscal 2009), which continued to demonstrate its resilience. Sales to the industrial OEM and industrial replacement end markets (23% of Power Transmission’s sales for Fiscal 2009) declined by 28% due to a decline in volumes and some destocking by our customers. Sales to the automotive OEM end market (39% of Power Transmission’s sales for Fiscal 2009) decreased approximately 20%, driven by lower automotive production levels, particularly in North America and Europe.

Operating profit in our Power Transmission segment was $143.0 million for Fiscal 2009 compared with a loss of $70.6 million for Fiscal 2008. Power Transmission’s operating result included restructuring costs of $75.6 million for Fiscal 2009 compared with $13.8 million for Fiscal 2008, impairments of $23.2 million for Fiscal 2009 compared with $284.6 million for Fiscal 2008 and a gain of $29.7 million on the amendment of post-employment benefits in Fiscal 2009. Restructuring costs recognized in the first half of 2009 were primarily related to the cessation of manufacturing operations in Aachen, Germany, and the closure of the facilities in Mississauga and London, Canada and FormFlo in the U.K. Restructuring costs for Fiscal 2008 were primarily related to the closure of the manufacturing facility in Moncks Corner, South Carolina. Impairments recognized in Fiscal 2009 arose as a consequence of restructuring initiatives. During Fiscal 2008, Power Transmission recognized a $194.6 million impairment of goodwill and a further $90.0 million impairment of property, plant and equipment due to the significant deterioration of the North American automotive OE and industrial end markets.

Adjusted EBITDA in our Power Transmission segment was $295.8 million for Fiscal 2009 compared with $333.0 million for Fiscal 2008, a decline of 11.2%. Adjusted EBITDA margin increased to 12.0% in Fiscal 2009, compared with 10.7% in Fiscal 2008.

 

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Fluid Power

 

$ in millions, unless otherwise stated    Fiscal 2009     Fiscal 2008     Fiscal 2009 vs
Fiscal 2008
% Change		  

Sales

      588.7       832.3        (29.3 )% 

Operating (loss)/profit

      (22.8 )      29.0     

Adjusted EBITDA

      18.8       79.3     

Adjusted EBITDA margin

      3.2 %      9.5 %   

Sales in our Fluid Power segment were $588.7 million for Fiscal 2009 compared with $832.3 million for Fiscal 2008, a decline of 29.3%. Adjusted for the effect of adverse currency exchange rate fluctuations, sales declined by $210.0 million compared with Fiscal 2008. Sales to the industrial OEM market (27% of Fluid Power’s sales for Fiscal 2009) were down 46% compared with Fiscal 2008 due to continued severely depressed industrial activity caused by the global economic recession. Sales to the industrial replacement end market were down 24% for Fiscal 2009 compared with Fiscal 2008 due to a decline in volumes and some destocking by our customers. Overall, sales increased by 8.8% in the second half of 2009 compared with the first half, due to more stable market conditions and a reduction in destocking by our customers.

Our Fluid Power segment incurred an operating loss of $22.8 million in Fiscal 2009 compared with an operating profit of $29.0 million for Fiscal 2008. Fluid Power’s operating result included restructuring costs of $26.0 million for Fiscal 2009 compared with $1.9 million for Fiscal 2008, impairments of $12.5 million for Fiscal 2009 compared with $11.7 million for Fiscal 2008 and a gain on the amendment of post-employment benefits of $31.4 million for Fiscal 2009. Restructuring costs recognized in Fiscal 2009 principally related to the cessation of hose manufacturing activities in Erembodegem, Belgium and the substantial closure of an assembly facility in St. Neots, U.K. Impairments recognized in Fiscal 2009 arose as a consequence of restructuring initiatives. Impairments recognized in Fiscal 2008 were related to the property, plant and equipment of certain of the Fluid Power segment’s businesses in Europe.

Adjusted EBITDA in our Fluid Power segment was $18.8 million for Fiscal 2009 compared with $79.3 million for Fiscal 2008, the decline being principally due to the significant reduction in sales volumes and initiatives to reduce inventory levels. Adjusted EBITDA margin declined to 3.2% in Fiscal 2009, compared with 9.5% in Fiscal 2008.

Sensors & Valves

 

$ in millions, unless otherwise stated    Fiscal 2009     Fiscal 2008     Fiscal 2009 vs
Fiscal 2008
% Change		  

Sales

      313.6       421.0       (25.5 )% 

Operating (loss)/profit

      (3.5 )      27.7    

Adjusted EBITDA

      25.6       56.5    

Adjusted EBITDA margin

      8.2 %      13.4 %   

Sales in the Sensors & Valves segment were $313.6 million for Fiscal 2009 compared with $421.0 million for Fiscal 2008, a decline of 25.5%. Adjusted for the effect of adverse currency exchange rate fluctuations, sales fell by $64.6 million compared with Fiscal 2008, primarily as a result of lower volumes in the automotive OE end market (74% of Sensors & Valves’ sales for Fiscal 2009). Schrader International’s automotive aftermarket business, which accounts for the remainder of the Sensors & Valves segment’s sales, was affected by low customer demand and declined compared with 2008.

Our Sensors and Valves segment incurred an operating loss of $3.5 million in Fiscal 2009 compared with an operating profit of $27.7 million for Fiscal 2008. Sensors & Valves’ operating result included restructuring costs of $3.2 million for Fiscal 2009 compared with $0.2 million for Fiscal 2008 and impairments of $1.1 million for Fiscal 2008.

Adjusted EBITDA in our Sensors & Valves segment was $25.6 million for Fiscal 2009 compared with $56.5 million for Fiscal 2008, the decline being principally due to lower sales volumes. Adjusted EBITDA margin declined to 8.2% in Fiscal 2009 compared with 13.4% in Fiscal 2008.

 

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Other Industrial & Automotive

 

$ in millions, unless otherwise stated    Fiscal 2009     Fiscal 2008     Fiscal 2009 vs
Fiscal 2008
% Change		  

Sales

      463.4       602.1       (23.0 )% 

Operating profit

      13.8       41.6    

Adjusted EBITDA

      41.6       61.9    

Adjusted EBITDA margin

      9.0 %      10.3 %   

Sales in our Other I&A segment were $463.4 million for Fiscal 2009 compared with $602.1 million for Fiscal 2008, a decline of 23.0%. Adjusted for the effect of adverse currency exchange rate fluctuations, sales declined by $134.2 million compared with Fiscal 2008. The industrial and recreational vehicle markets (approximately 80% of Other I&A’s sales for Fiscal 2009), continued to decline due to the low level of industrial activity, particularly in the Dexter business as a result of lower demand in the utility, industrial and recreational trailer markets.

Operating profit in our Other I&A segment was $13.8 million for Fiscal 2009 compared with $41.6 million for Fiscal 2008. Other I&A’s operating result included restructuring costs of $12.2 million for Fiscal 2009 compared with $3.2 million for Fiscal 2008, as well as impairments of $0.7 million and a gain on the amendment of post-employment benefits of $1.7 million for Fiscal 2009. Restructuring costs recognized in Fiscal 2009 were primarily related to the closure of Ideal’s manufacturing facility at St. Augustine, Florida and the rationalization of Dexter’s manufacturing facilities.

Adjusted EBITDA in our Other I&A segment was $41.6 million for Fiscal 2009 compared with $61.9 million for Fiscal 2008, the decline being principally due to significantly reduced sales volumes. Adjusted EBITDA margin declined to 9.0% in Fiscal 2009, compared with 10.3% in Fiscal 2008.

Building Products

Market Background

In the U.S., non-residential construction declined on a square foot basis by 46% in 2009 compared with 2008, and by 33% on a value basis (as measured by Dodge). Building Products’ key sector is offices followed by education, hospitals, public buildings and hotels. All of Building Products’ sectors declined, with office and hotels the worst affected, declining by around 60% in square footage compared with 2008. However, the public buildings sector rose by around 10% on a value basis compared with 2008. The U.S. Architectural Billings Index, which is regarded as a leading indicator of future commercial construction activity, remained under 50, indicating continuing contraction in activity. Office vacancy rates continued to rise.

The U.S. residential construction market declined by 39% in 2009 compared with 2008 to 554,000 housing starts (according to the NAHB), the fourth straight year of decline and a record low. In 2009, housing starts were over 70% lower than the peak of around 2 million units in 2005. Around the middle of 2009, the market stabilized at around 600,000 units on an annualized basis. Housing inventories fell throughout the year, reaching 8.1 months for new homes and 7.2 for existing homes. Home prices, as measured by the Case-Shiller Index, fell throughout the first half of 2009 but recovered in the second half, showing month-on-month gains from May to October. Existing home sales improved throughout 2009, achieving year-on-year increases from July onwards. The U.S. tax credit stimulus was in place for the majority of 2009 and provided some stability to the market.

Air Distribution

 

$ in millions, unless otherwise stated    Fiscal 2009     Fiscal 2008     Fiscal 2009 vs
Fiscal 2008
% Change		  

Sales

      874.2       1,112.3       (21.4 )% 

Operating profit

      48.2       61.2    

Adjusted EBITDA

      105.6       132.7    

Adjusted EBITDA margin

      12.1 %      11.9 %   

 

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Sales in our Air Distribution segment were $874.2 million for Fiscal 2009 compared with $1,112.3 million for Fiscal 2008, a decline of 21.4%. Adjusted for the effect of adverse currency exchange rate fluctuations, sales declined by $223.3 million compared with Fiscal 2008. After a strong start in the early part of Fiscal 2009, sales into the non-residential construction markets weakened as a result of the declining market conditions and consequently orders and backlogs continued to weaken throughout Fiscal 2009. As a result, sales in our non-residential businesses (72% of Air Distribution’s sales for Fiscal 2009) decreased by 21% for Fiscal 2009. Sales to the residential construction market (28% of Air Distribution’s sales for Fiscal 2009) declined in the first half of 2009 but stabilized in the second half of 2009. Overall, sales in our residential business were down 24% for Fiscal 2009 compared with Fiscal 2008.

Operating profit in our Air Distribution segment was $48.2 million for Fiscal 2009 compared with $61.2 million for Fiscal 2008. Air Distribution’s operating result included restructuring costs of $5.1 million for Fiscal 2009 compared with $3.6 million for Fiscal 2008 and impairments of $18.6 million for Fiscal 2009 compared with $34.0 million for Fiscal 2008. Impairments recognized in Fiscal 2008 related to a decline in the U.S. residential construction end market.

Adjusted EBITDA in our Air Distribution segment was $105.6 million for Fiscal 2009 compared with $132.7 million for Fiscal 2008, the decline being due principally due to reduced sales volumes in both the non-residential and residential construction end markets. However, the adjusted EBITDA margin increased slightly to 12.1% in Fiscal 2009, compared with 11.9% in Fiscal 2008.

Bathware

 

$ in millions, unless otherwise stated    Fiscal 2009     Fiscal 2008     Fiscal 2009 vs
Fiscal 2008
% Change		  

Sales

      140.3       208.2       (32.6 )% 

Operating loss

      (12.8 )      (14.2 )   

Adjusted EBITDA

      (0.1 )      (2.1 )   

Adjusted EBITDA margin

      -0.1 %      -1.0 %   

Sales in our Bathware segment were $140.3 million for Fiscal 2009 compared with $208.2 million for Fiscal 2008, a decline of 32.6%. Bathware sells primarily to the U.S. residential construction and remodeling markets, which continued to weaken, particularly in the first half of 2009.

Our Bathware segment incurred an operating loss of $12.8 million for Fiscal 2009 and a loss of $14.2 million for Fiscal 2008. Bathware’s operating result included restructuring costs of $1.6 million for Fiscal 2009 compared with $2.2 million for Fiscal 2008, as well as an impairment charge of $2.5 million for Fiscal 2009 which arose as a consequence of our restructuring initiatives.

Adjusted EBITDA in our Bathware segment was a loss of $0.1 million for Fiscal 2009 and a loss of $2.1 million for Fiscal 2008. Bathware benefited from our cost reduction and restructuring initiatives but this was partially offset by lower overhead absorption due to reduced production levels.

Corporate

Corporate costs were $32.2 million in Fiscal 2009 compared with $37.0 million in Fiscal 2008. Also, in Fiscal 2009, Corporate recognized an impairment of $15.5 million on receivables held in relation to the disposal of businesses in previous years.

Corporate incurred an adjusted EBITDA loss of $26.7 million for Fiscal 2009 compared with a loss of $27.8 million for Fiscal 2008.

 

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LIQUIDITY AND CAPITAL RESOURCES

Background

Our primary liquidity and capital resource needs are for working capital, debt service requirements, capital expenditure, facility expansions and acquisitions. We expect to finance our cash requirements with cash on hand, cash flows from operations and, where necessary, borrowings under the revolving credit portion of our senior secured credit facilities. Prior to the Acquisition, our liquidity and capital resource needs were the same in nature but debt servicing requirements were substantially lower and capital expenditure was not subject to any limitation (from Fiscal 2011 onwards, capital expenditure is limited to $175 million per year under the senior secured credit facilities). We have historically relied on our cash flow from operations and various debt and equity financings for liquidity.

Based on our current operations, we believe that cash on hand, together with cash flows from operations and available borrowings under the revolving credit portion of our senior secured credit facilities, will be adequate to meet our cash requirements for the next twelve months. However, our ability to make scheduled payments of principal of, to pay interest on, and to refinance, our indebtedness, including the notes, to comply with the financial covenants under our debt agreements, and to fund our other liquidity requirements will depend on our ability to generate cash in the future, which is subject to a number of factors some of which may be beyond our control, including general economic, financial and competitive factors.

Cash Flow

Cash generated from operations was $281.5 million for Fiscal 2010 compared with $532.1 million for Fiscal 2009, a decline of $250.6 million.

During Fiscal 2010, cash generated from operations included a cash outflow of $114.4 million (Fiscal 2009: $nil) on transaction costs relating to business combinations and an outflow of $53.2 million (Fiscal 2009: $80.1 million) in relation to restructuring costs.

During Fiscal 2009, cash generated from operations benefited from a decline of $244.0 million in working capital, due largely to a reduction in inventory in response to declining sales volumes. During Fiscal 2010, however, cash generated from operations was adversely affected by an increase of $221.7 million in working capital (after adjusting for the uplift of $144.2 million to the carrying amount of inventory on the Acquisition), which was due principally to an increase in receivables and inventories resulting from the recovery in sales volumes. Excluding cash outflow on transaction costs relating to business combinations, restructurings costs and movements in working capital, operating cash flow was $670.8 million compared with $368.2 million in Fiscal 2009, an increase of $302.6 million, which was due largely to the improvement in our profitability as measured by adjusted EBITDA.

Gross capital expenditure was $155.9 million during Fiscal 2010, compared with $123.0 million for Fiscal 2009. Excluding the proceeds on asset sales arising from restructurings of $24.1 million (Fiscal 2009: $10.8 million), net capital expenditure for Fiscal 2010 was $152.7 million (Fiscal 2009: $120.9 million).

The table below shows the movements in net debt:

 

     Successor     Predecessor  
$ in millions    Q4 2010       9M 2010       Fiscal 2010     Fiscal 2009  

Cash generated from operations

      66.3       215.2       281.5       532.1  

Capital expenditure

      (60.2 )      (95.7 )      (155.9 )      (123.0 ) 

Disposal of property, plant and equipment

      2.7       24.6       27.3       12.9  
                                

Trading cash flow

      8.8       144.1       152.9       422.0  

Income taxes paid (net)

      (20.9 )      (20.5 )      (41.4 )      (19.1 ) 

Interest paid (net)

      (56.7 )      (2.1 )      (58.8 )      (34.3 ) 

Financing costs paid

      (182.4 )      —          (182.4 )      (6.3 ) 

Dividends paid

      —          (56.9 )      (56.9 )      (48.3 ) 

Acquisitions and disposals (net)

      (4,531.5 )      (45.2 )      (4,576.7 )      (36.3 ) 

Issue of ordinary shares

      2,142.3       (0.7 )      2,141.6       (1.3 ) 

Other movements

      4.8       52.7       57.5       (4.3 ) 

Foreign currency movements

      (46.4 )      1.9       (44.5 )      (3.6 ) 
                                

Cash movement in net debt

      (2,682.0 )      73.3       (2,608.7 )      268.5  

Non-cash movements in net debt

      (44.9 )      —          (44.9 )      —     
                                

(Increase)/decrease in net debt

      (2,726.9 )      73.3       (2,653.6 )      268.5  
                                

 

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Treasury Management

Our central treasury function is responsible for procuring our financial resources and maintaining an efficient capital structure, together with managing our liquidity, foreign exchange and interest rate exposures.

All treasury operations are conducted within strict policies and guidelines that are approved by the Board. Compliance with those policies and guidelines is monitored by the regular reporting of treasury activities to the Board.

A key element of our treasury philosophy is that funding, interest rate and currency decisions and the location of cash and debt balances are determined independently from each other. Our borrowing requirements are met by raising funds in the most favorable markets. Management aims to retain a portion of net debt in the foreign currencies in which the net assets of our operations are denominated. The desired currency profile of net debt is achieved by entering into currency derivative contracts.

Management does not hedge the proportion of foreign operations effectively funded by shareholders’ equity. While the net income of foreign operations is not hedged, the effect of currency fluctuations on our reported net income is partly offset by interest payable on net debt denominated in foreign currencies.

From time to time, we also enter into currency derivative contracts to manage currency transaction exposures.

Where necessary, the desired interest rate profile of net debt in each currency is achieved by entering into interest rate derivative contracts.

Our portfolio of cash and cash equivalents is managed such that there is no significant concentration of credit risk in any one bank or other financial institution. Management monitors closely the credit quality of the institutions with which it holds deposits. Similar considerations are given to our portfolio of derivative financial instruments.

Our borrowing facilities are monitored against forecast requirements and timely action is taken to put in place, renew or replace credit lines. Management’s policy is to reduce liquidity risk by diversifying our funding sources and by staggering the maturity of its borrowings.

We have established credit ratings of Ba3 Stable with Moody’s and BB- Negative with Standard & Poor’s. Credit ratings are subject to regular review by the credit rating agencies and may change in response to economic and commercial developments.

An analysis of our exposure to liquidity risk, credit risk and market risk is presented in note 34 to the consolidated financial statements presented elsewhere in this prospectus.

Borrowings

As at December 31, 2010, our borrowings principally consisted of two term loans under the senior secured credit facilities and the notes that were issued to finance the Acquisition.

 

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Our borrowings as at December 31, 2010 may be analyzed as follows:

 

$ in millions    Carrying amount      Principal amount  
   Successor     Predecessor      Successor     Predecessor  
   As at
December 31,
2010		     As at
January 2,
2010		      As at
December 31,
2010		     As at
January 2,
2010		  

Bank overdrafts

      7.1        4.8         7.1        4.8   

Bank and other loans:

          

– Secured

          

Term Loan A

      271.2        —           296.0        —     

Term Loan B

      1,540.9        —           1,677.3        —     

Second Lien Notes

      1,098.3        —           1,150.0        —     

Other bank loans

      —          0.9         —          0.9   
                                 
     2,910.4        0.9         3,123.3        0.9   
                                 

– Unsecured

          

Bank loans

      —          1.2        —          1.2   

2011 Notes

      172.2        256.5        165.5        241.9   

2015 Notes

      27.1        439.6        26.5        403.1   

Loan notes

      44.9        0.3         45.1        1.1   
                                 
     244.2        697.6         237.1        647.3   
                                 
     3,161.7        703.3         3,367.5        653.0   
                                 

A reconciliation of the carrying amount to the principal amount of our borrowings is presented in note 30 to the consolidated financial statements included elsewhere in this prospectus.

Secured Borrowings

The senior secured credit facilities and the notes were issued by Tomkins, Inc. and Tomkins, LLC, which are both wholly owned subsidiaries of Holdings, and are jointly and severally and fully and unconditionally guaranteed by the Holdings and certain other of Holdings’wholly-owned subsidiaries (the “Guarantors”). An analysis of the security given is presented in note 47 to the consolidated financial statements included elsewhere in this prospectus.

Bank Loans

Senior Secured Credit Facilities

We have senior secured credit facilities consisting of a Term Loan A credit facility, a Term Loan B credit facility and a senior secured revolving credit facility.

We initially borrowed $300.0 million under the Term Loan A credit facility and $1,700.0 million under the Term Loan B credit facility. On December 29, 2010, we prepaid $4.0 million against the Term Loan A credit facility and $22.7 million against the Term Loan B credit facility. As at December 31, 2010, the principal amount outstanding under the Term Loan A credit facility was $296.0 million and that under the Term Loan B credit facility was $1,677.3 million.

The revolving credit facility provides for multi-currency revolving loans and letters of credit up to an aggregate principal amount of $300.0 million, with a letter of credit sub-facility of $100.0 million. As at December 31, 2010, there were no drawings for cash under the revolving credit facility but there were letters of credit outstanding amounting to $40.3 million.

Subject to certain conditions, the revolving credit facility may be increased by up to $100.0 million and the Term Loan B credit facility increased by, or new term loan facilities established up to, $400.0 million (less any increase in the revolving credit facility).

Borrowings under the senior secured credit facilities bear interest at a floating rate, which can be either LIBOR plus an applicable margin or, at our option, a base rate as defined in the credit agreement plus an applicable

 

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margin. The applicable margin for the Term Loan B credit facility is 4.5% per annum for LIBOR and 3.5% per annum for base rate. The applicable margin for the Term Loan A credit facility and the revolving credit facility is between 3.75% and 4.25% per annum for LIBOR and 2.75% and 3.25% per annum for base rate depending on a total leverage to EBITDA ratio. LIBOR is subject to a 1.75% floor and base rate is subject to a 2.75% floor. As at December 31, 2010, borrowings under the Term Loan A credit facility attracted an interest rate of 6.0% per annum and those under the Term Loan B credit facility attracted an interest rate of 6.25% per annum (in both cases, to be next re-set on March 31, 2011). Each letter of credit issued under the revolving credit facility attracts a participation fee equal to the applicable LIBOR margin under the revolving credit facility to the maximum amount available to be drawn and a fronting fee of the greater of 0.25% of the maximum amount available to be drawn and $1,500 per annum. An unused line fee of 0.75% per annum is based on the unused portion of the revolving credit facility (which may decrease to 0.5% per annum based on a total leverage to EBITDA ratio).

The Term Loan A credit facility and the revolving credit facility mature on September 29, 2015 and the Term Loan B credit facility matures on September 29, 2016. The Term Loan A credit facility is subject to quarterly amortization payments of 2.5% and the Term Loan B credit facility is subject to quarterly amortization payments of 0.25%, in each case based on the original principal amount less certain prepayments and commencing on March 31, 2011 with the balance payable on maturity.

We may voluntarily prepay loans or reduce commitments under the senior secured credit facilities, in whole or in part, subject to minimum amounts without premium or penalty, other than in the case of certain re-pricing transactions with respect to the Term Loan B credit facility prior to September 29, 2011, which shall be subject to a 1% premium. If we prepay LIBOR rate loans other than at the end of an applicable interest period, it is required to reimburse the lenders for any consequential losses or expenses. We must prepay the Term Loan A credit facility and Term Loan B credit facility with net cash proceeds of asset sales, casualty and condemnation events, incurrence of indebtedness (other than indebtedness permitted to be incurred) and a percentage of excess cash flow based on a total leverage to EBITDA ratio, in each case subject to certain exceptions such as reinvestment rights.

On February 11, 2011, we agreed with the providers of the senior secured credit facilities a re-pricing of Term Loan A and Term Loan B and amendments to certain of the covenants attaching to the facilities. It was agreed that for both Term Loan A and Term Loan B the applicable margin for LIBOR will be reduced to 3.0% per annum, with LIBOR being subject to a 1.25% floor, and the applicable margin for base rate will be reduced to 2.0% per annum, with base rate being subject to a 2.25% floor. The re-pricing became effective on February 17, 2011 and attracted a one-off premium payment by us of $16.8 million.

Multi-Currency Revolving Credit Facility

As at January 2, 2010, Tomkins had in place a £400 million multi-currency revolving credit facility and had in place a $450 million forward-start facility that commenced on the expiry of the existing facility in August 2010 and was itself due to expire in May 2012. Borrowings under the facility attracted interest at floating rates determined by reference to LIBOR. As at January 2, 2010 and during 9M 2010, there were no drawings against the facility, which was replaced by the senior secured credit facilities on the Acquisition.

Other borrowings

Second Lien Notes

On September 29, 2010, we issued the $1,150.0 million notes.

 

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On and after October 1, 2014, we may redeem the notes, at its option, in whole at any time or in part from time to time, at the following redemption prices (expressed as percentage of the principal amount), plus accrued and unpaid interest to the redemption date:

 

     Redemption price  

During the year commencing:

   

– October 1, 2014

      104.50 % 

– October 1, 2015

      102.25 % 

– October 1, 2016 and thereafter

      100.00 % 

At any time prior to October 1, 2014, we may redeem the notes at its option, in whole at any time or in part from time to time, at 100% of the principal amount thereof plus the greater of (i) 1% of the principal amount and (ii) the excess of the present value at the redemption date of the redemption price as at October 1, 2014 and the required interest payments due from the redemption date to October 1, 2014 (discounted using an appropriate U.S. Treasury Rate plus 50 basis points) over the principal amount, plus accrued and unpaid interest to the redemption date.

At any time, or from time to time, prior to October 1, 2013, but not more than once in any twelve-month period, we may redeem up to 10% of the original aggregate principal amount of the notes at a redemption price of 103% of the principal amount thereof plus accrued and unpaid interest thereon up to but not including the redemption date.

Notwithstanding the foregoing, at any time and from time to time prior to October 1, 2013, we may redeem in the aggregate up to 35% of the original aggregate principal amount of the notes (calculated after giving effect to any issuance of additional notes) with the net cash proceeds of equity offerings by Top Co-op, Holdings’ immediate and ultimate parent entity, or certain of its subsidiaries at a redemption price of 109% of the principal amount thereof plus accrued and unpaid interest thereon up to but not including the redemption date, provided that at least 65% of the original aggregate principal amount of the notes remain outstanding after each such redemption (calculated after giving effect to any issuance of additional notes) and we satisfy certain other conditions.

In the event of a change of control over Holdings, each holder will have the right to require us to repurchase all or any part of such holder’s notes at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest to the date of repurchase, except to the extent that we have previously elected to redeem the notes.

2011 Notes and 2015 Notes

When it was acquired by the Group, Tomkins had outstanding the £150 million 2011 Notes and the £250 million 2015 Notes.

Each of the 2011 Notes and the 2015 Notes contain a put option giving the holders the option to put their notes to the relevant issuer at par plus accrued interest in the event of a change of control or certain acquisitions and disposals and, in either case, a ratings downgrade occurring as a result of such transaction.

On September 13, 2010, we offered to purchase the outstanding 2011 Notes at a price of 105.787% (plus accrued and unpaid interest) and the outstanding 2015 Notes at a price of 100.50% (plus accrued and unpaid interest). Acceptances were received in respect of £40.9 million of the 2011 Notes and £109.3 million of the 2015 Notes. On October 6, 2010, the purchase was completed for total consideration of £153.1 million (plus accrued interest of £3.0 million).

On November 19, 2010, we notified holders of the 2011 Notes and the 2015 Notes that the credit rating of the notes had been withdrawn by Moody’s and downgraded by Standard & Poor’s as a consequence of the Acquisition and that this constituted a put event entitling the holders to redeem the notes at par (plus accrued and unpaid interest). Put notices were received in respect of £2.1 million of the 2011 Notes and £123.5 million of the 2015 Notes. Settlement took place on December 17, 2010 for total consideration of £125.6 million (plus accrued interest of £2.0 million).

As at December 31, 2010, the principal amount of the outstanding 2011 Notes was £107.0 million and that of the 2015 Notes was £17.2 million.

On December 30, 2010, we made a further offer to purchase the outstanding 2011 Notes at a price of 105.00% (plus accrued and unpaid interest). Acceptances were received in respect of £4.9 million of the 2011 Notes. Settlement took place on January 19, 2011 and the principal amount of the outstanding 2011 Notes was thereby reduced to £102.1 million.

 

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Loan Note Alternative

Under the terms of the Acquisition, certain shareholders in Tomkins Limited elected to receive loan notes rather than cash in respect of all or part of the consideration payable on the purchase of their shares in Tomkins Limited, subject to a maximum aggregate amount of £50 million (the “Loan Note Alternative”). As at December 31, 2010, loan notes with a principal amount of £29.0 million were outstanding under the Loan Note Alternative. The loan notes accrue interest at the higher of 0.8% below LIBOR and 0% (to be next re-set on July 1, 2011).

The loan notes fall due for repayment, at par, on December 31, 2015. From June 30, 2011 until December 31, 2015, each holder has the right to require full or part repayment, at par, half-yearly on June 30 and December 31 and for this reason these loan notes are classified as current liabilities. At any time on or after six months after the date of issue of the loan notes, we may purchase any of the loan notes at any price by tender, private treaty or otherwise.

Although the loan notes are unsecured, we are required to retain in an escrow account cash equivalent to the nominal amount of the outstanding loan notes.

Maturity of Borrowings

As at December 31, 2010, the maturity of the principal amount of our borrowings was as follows:

 

$ in millions    Falling due         
   Within
1 year		      Between
1 and 2
years		      Between
2 and 5
years		      After
5 years		      Total  

Bank overdrafts

      7.1         —           —           —           7.1   
                                            

Bank and other loans:

               

– Secured

               

Term Loan A

      29.6         29.6         236.8         —           296.0   

Term Loan B

      16.9         16.8         50.3         1,593.3         1,677.3   

Second Lien Notes

      —           —           —           1,150.0         1,150.0   
                                            
     46.5         46.4         287.1         2,743.3         3,123.3   

– Unsecured

               

2011 Notes

      165.5         —           —           —           165.5   

2015 Notes

      —           —           26.5         —           26.5   

Loan notes

      44.9         0.2         —           —           45.1   
                                            
     210.4         0.2         26.5         —           237.1   
                                            
     264.0         46.6         313.6         2,743.3         3,367.5   
                                            

Seasonality of Borrowings

We operate in a wide range of markets and geographic locations and, as a result, there is little seasonality in our borrowing requirements. Fluctuations in our borrowings are caused principally by the timing of capital expenditure and interest payments.

Subsequent to the Acquisition, when our borrowings increased substantially, the principal amount of our borrowings decreased from $3,842.8 million to stand at $3,367.5 million as at December 31, 2010.

 

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Borrowing Headroom

As at December 31, 2010, our committed revolving credit facility of $300.0 million was undrawn for cash but there were letters of credit outstanding against the facility amounting to $40.3 million. Also, we have drawn $7.2 million against uncommitted borrowing facilities and had outstanding performance bonds, letters of credit and bank guarantees amounting to $66.0 million (in addition to those outstanding under the revolving credit facility).

Overall, therefore, our committed borrowing headroom was $186.5 million, in addition to cash balances of $506.3 million (including collateralized cash of $47.0 million).

Borrowing Covenants

We are subject to covenants, representations and warranties in respect of the senior secured credit facilities including two financial covenants as defined in the credit agreement that were tested for the first time for the covenant test period ended December 31, 2010. Firstly, the ratio of consolidated total debt to consolidated EBITDA (the “total leverage ratio”) must not exceed 6.1 times (for the covenant test period ended December 31, 2010, the ratio was 4.23 times). Secondly, the ratio of consolidated EBITDA to consolidated net interest (the “interest coverage ratio”) must not be less than 1.8 times (for the covenant test period ended December 31, 2010, the ratio was 5.48 times).

Going forward, the compliance with these financial covenants will be tested for a period to the end of each calendar quarter. The limits against which the financial covenants are tested become progressively stricter for each test period until December 31, 2012. Thereafter, the total leverage ratio must not exceed 5.25 times and the interest coverage ratio must not be less than 2.1 times.

The limits for the forthcoming year are set out below:

 

     Total leverage ratio
Must not exceed		     Interest coverage ratio
Must not be less than		  

Covenant test period ended:

     

– March 31, 2011

      6.10 x      1.80 x 

– June 30, 2011

      6.10 x      1.80 x 

– September 30, 2011

      6.00 x      1.85 x 

– December 31, 2011

      5.75 x      1.95 x 

– March 31, 2012

      5.55 x      2.00 x 

Any future non-compliance with the borrowing covenants could, if not waived, constitute an event of default and may, in certain circumstances, lead to an acceleration of the maturity of borrowings drawn down and the inability to access committed facilities.

Cash Balances

We manage our cash balances such that there is no significant concentration of credit risk in any one bank or other financial institution. We monitor closely the quality of the institutions that hold our deposits. Similar considerations are given to our portfolio of derivative financial instruments. As at December 31, 2010 95% of our cash balances were held with institutions rated at least A-1 by Standard & Poor’s and P-1 by Moody’s.

Our central treasury function is responsible for maximizing the return on surplus cash balances within the constraints of our liquidity and credit policy. We achieve this, where possible, by controlling directly all surplus cash balances and pooling arrangements on an ongoing basis and by reviewing the efficiency of all other cash balances across our businesses on a weekly basis.

Our policy is to apply funds from one part of our business to meet the obligations of another, wherever possible, in order to ensure maximum efficiency in the use of our funds. No material restrictions apply that limit the application of this policy.

 

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As at December 31, 2010, cash balances amounted to $459.3 million, of which $348.8 million was interest-bearing. All interest bearing deposits attract interest at floating rates. As at December 31, 2010, the weighted average interest rate on interest-bearing cash balances was 1.0%.

Other Assets and Liabilities

Intangible Assets

Goodwill

Goodwill recognized on the Acquisition was calculated as follows:

 

     $ in millions  

Consideration

      4,615.4  

Non-controlling interests

      304.5  
        
     4,919.9  

Net assets acquired

      (3,177.8 ) 
        

Goodwill recognized on Acquisition

      1,742.1  

Foreign currency translation

      3.3  
        

Goodwill recognized as at December 31, 2010

      1,745.4  
        

Goodwill recognized on the Acquisition is provisional because management has been unable to finalize its assessment of the fair values at the acquisition date of certain identifiable intangible assets and items of property, plant and equipment, but expects to complete the assessment during the first half of 2011.

Goodwill is principally attributable to expected future opportunities to increase sales and further enhance margins by further developing Tomkins’ product range and service capabilities (with an emphasis on the growing markets for energy-efficient and environmentally-friendly products), extending Tomkins’ global presence by further penetrating markets in the emerging economies, and by pursuing performance improvement initiatives. Of the goodwill recognized as at December 31, 2010, $1,540.0 million is allocated to I&A (of which $1,109.6 million is allocated to the Power Transmission operating segment) and $205.4 million is allocated to Building Products.

Further details on the accounting for Acquisition are provided in note 41 to the consolidated financial statements included elsewhere in this prospectus.

Other intangible assets

As at January 2, 2010, the carrying amount of other intangible assets was $78.0 million. During 9M 2010, we recognized additions of $12.6 million and incurred amortization of $17.0 million. As a result of the accounting for the Acquisition, we recognized a fair value uplift of $2,227.8 million to the carrying amount of the identifiable intangible assets held by Tomkins (which principally comprised brands and trade names, customer relationships and technology and know-how). During Q4 2010, the amortization expense recognized in respect of other intangible assets was $44.2 million. As at December 31, 2010, the carrying amount of other intangible assets was $2,268.5 million, that were initially recognized at their fair values on the Acquisition.

Applied research and development is important to our manufacturing businesses and there are centers in the U.S., Europe and Japan that focus on the introduction of new and improved products, the application of technology to reduce unit and operating costs and to improve services to customers. During Fiscal 2010, pro forma research and development expenditure was $85.9 million (Fiscal 2009: $78.6 million), of which $2.8 million (Fiscal 2009: $0.6 million) was capitalized.

Property, plant and equipment

As at January 2, 2010, the carrying amount of property, plant and equipment was $1,122.8 million. During 9M 2010, we recognized additions of $99.8 million and incurred a depreciation expense of $120.1 million. As a

 

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result of the accounting for the Acquisition, we recognized a fair value uplift of $260.2 million to the carrying amount of the property, plant and equipment held by Tomkins. Additions during Q4 2010 were $60.4 million and the depreciation expense for the period was $54.0 million. As at December 31, 2010, the carrying amount of property, plant and equipment was $1,359.1 million, including $4.2 million held under finance leases.

Our manufacturing facilities, distribution centers and offices are located in a number of countries, with a large proportion in North America. We own the majority of these facilities and continues to improve and replace them to meet the needs of its individual operations. As at December 31, 2010, I&A operated from 145 facilities in 25 countries, and Building Products operated from 62 facilities, predominantly in North America. As at December 31, 2010, the geographic analysis of our property, plant and equipment was as follows:

 

     Carrying amount  
     $ in millions      %  

U.S.

      534.8         39.3   

U.K.

      80.0         5.9   

Rest of Europe

      168.3         12.4   

Rest of the world:

      

– Canada

      169.3         12.5   

– China

      135.4         10.0   

– Mexico

      79.1         5.8   

– Brazil

      74.5         5.5   

– Other countries

      117.7         8.6   
     576.0         42.4   
                 
     1,359.1         100.0   
                 

Due to the diverse nature of our business, there was no individual facility, the loss of which would have a material adverse impact on our operations. Equally, there are no plans to construct, expand or improve facilities that would, on completion or cancellation, significantly affect our operations.

Post-employment benefits

Pensions

We operate a number of defined benefit pension plans, principally in the U.K. and the U.S., of which most are funded. All of the plans are closed to new entrants. During Fiscal 2009, management closed the principal pension plans in North America to future service accrual and the deferred pension benefits accrued under them were frozen. As a result, most of our pension plans are now closed to future service accrual by current employees. Funded plans receive contributions from us and, where they remain eligible, current employees, at rates that are determined by independent actuaries taking into account any funding objectives prescribed by local legislation.

As at December 31, 2010, the present value of the benefit obligation was $1,128.5 million (January 2, 2010: $1,116.0 million). Excluding the effects of currency exchange rate changes, the obligation increased by $20.6 million during Fiscal 2010.

As at December 31, 2010, the fair value of the plan assets was $1,011.1 million (January 2, 2010: $924.5 million). Excluding the effect of currency exchange rate changes, the plan assets increased by $95.4 million during Fiscal 2010.

On an actuarial basis, the net deficit in the plan was $117.4 million (January 2, 2009: $191.5 million) but, for accounting purposes, we were unable to recognize surpluses on certain of the plans amounting to $28.2 million (January 2, 2010: $8.6 million). Accordingly, the net pension liability recognized in the consolidated financial statements was $145.6 million (January 2, 2010: $200.1 million).

 

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$ in millions    Successor     Predecessor  
   As at
December 31, 2010		     As at
January 2, 2010		  

Benefit obligation

      (1,128.5 )      (1,116.0 ) 

Plan assets

      1,011.1       924.5  
                

Deficit in the plans

      (117.4 )      (191.5 ) 

Effect of the asset ceiling

      (28.2 )      (8.6 )
                

Net pension liability

      (145.6 )      (200.1 )
                

During Fiscal 2010, we contributed $44.0 million (Fiscal 2009: $52.7 million) to the defined benefit plans and expect to contribute approximately $46.9 million to them during 2011. Additionally, following negotiations with the trustees and regulatory authorities in connection with the Acquisition, we agreed to make one-off contributions amounting to $23.0 million to certain defined benefit pension plans in the U.S. and the U.K., of which $5.0 million was paid to the U.S. plans during Q4 2010 and $18.0 million was paid to the U.K. plans in January 2011, and agreed to forego optional short-term pension funding relief in the U.S. amounting to approximately $35.0 million.

Management of the risks associated with our defined benefit pension plans is the responsibility of our treasury function. Our primary objective is to identify and manage the risks associated with both the assets and liabilities of the defined benefit pension plans and we continue to work with the trustees of our pension plans to improve the management of our defined benefit pension risks.

The principal risks affecting the present value of the benefit obligation are: interest rate risk, inflation risk and mortality risk.

Management of the plan assets is the responsibility of trustee boards, over which we have varying degrees of influence depending on local regulations. We have made the trustee boards aware of its preference that, where plan assets are invested so as to match the cash flow and risk profiles of the benefit obligations, these arrangements are effective, and that other plan assets not so invested are held in investment grade bonds or broad-based local equity indices.

For some years, our U.S. plans have hedged the interest rate risk implicit in their benefit obligations. As at December 31, 2010, the benefit obligation of the funded U.S. plans amounted to $572.9 million, of which 96.7% was hedged using a combination of bonds and interest rate swaps with an average duration of 10.2 years.

For our business as a whole, we estimate that a 0.5% decrease in market interest rates would increase the benefit obligation by 3.6%, or $40.2 million. Only 9.2% of the benefit obligation of $1,128.5 million as at December 31, 2010 is exposed to future salary increases. We estimate that a 0.5% increase in the salary scale would increase the benefit obligation by $0.3 million.

Unless the benefit obligation is subject to a buy-out or buy-in, it is not practical to mitigate the effects of mortality risk. We estimate that if the average life expectancy of plan members increased by one year at age 65, the benefit obligation would increase by 2.6%, or $29.2 million.

During Fiscal 2010, the expense recognized in relation to defined contribution pension plans was $31.2 million (Fiscal 2009: $33.4 million).

Other benefits

We provide other post-employment benefits, principally health and life insurance cover, to certain of its employees in North America through a number of unfunded plans. During Fiscal 2009, management closed the Gates plan in the U.S. to new retirees and reduced the benefits payable to existing beneficiaries.

As at December 31, 2010, the liability recognized in respect of these plans was $130.0 million (January 2, 2010: $142.1 million). Excluding the effect of currency exchange rate changes, the liability increased by $9.3 million during Fiscal 2010.

 

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Benefits paid during Fiscal 2010 were $14.8 million (Fiscal 2009: $14.9 million).

Taxation

As at December 31, 2010, we recognized income tax liabilities amounting to $106.8 million (January 2, 2010: $94.7 million). Income tax recoverable was $11.0 million (January 2, 2010: $49.0 million).

As at December 31, 2010, we recognized a net deferred tax liability of $783.7 million (January 2, 2010: net deferred tax asset of $57.6 million), the change being principally due to the recognition of deferred tax on the fair value uplifts to the carrying amounts of long-lived assets on the Acquisition. Deferred tax assets of $825.1 million (January 2, 2010: $783.7 million) were not recognized in respect of tax losses and credits carried forward because it is not considered probable that taxable profits will be available against which they can be utilized.

As at December 31, 2010, deferred tax liabilities were not recognized on temporary differences amounting to $1,375.0 million associated with investments in subsidiaries. Deferred tax liabilities were not recognized on these temporary differences because we are able to control the timing of their reversal and it is probable that they will reverse in the foreseeable future. Income tax may be payable on these temporary differences if circumstances change, for example on the repatriation of assets from the subsidiaries concerned or on the sale or liquidation of one or more of them.

Contractual Obligations

As at December 31, 2010, our contractual obligations were as follows:

 

           Earliest period in which payment/(receipt) due  
$ in millions    Total     Less than
1 year		     1 –  3
years		      3 –  5
years		      After
5 years		  

Bank and other loans:

             

– Principal

      3,360.4       256.9       93.0         267.2         2,743.3   

– Interest payments(1)(2)

      1,522.7       243.5       451.5         437.1         390.6   

Derivative financial instruments:

             

– Payments(2)(3)

      473.1       473.1       —           —           —     

– Receipts(2)(3)

      (470.8 )      (470.8 )      —           —           —     

Finance leases

      4.9       0.7       0.8         0.8         2.6   

Operating leases

      220.1       45.1       63.3         45.3         66.4   

Post-employment benefits(4)

      64.9       64.9       —           —           —     

Purchase obligations(5)

      49.0       34.6       7.5         6.9         —     
                                          

Total(6)

      5,224.3       648.0       616.1         757.3         3,202.9   
                                          

 

(1) 

Future interest payments include payments on fixed and floating rate debt and are presented before the effect of interest rate derivatives.

(2) 

Floating rate interest payments and payments and receipts on the floating rate legs of interest rate derivatives are estimated based on market interest rates prevailing as at December 31, 2010.

(3) 

Receipts and payments on foreign currency derivatives are estimated based on market exchange rates prevailing as at December 31, 2010.

(4) 

Post-employment benefit obligations represent our expected cash contributions to its defined benefit plans in 2011. It is not practicable to present expected cash contributions for subsequent years because they are determined annually on an actuarial basis to provide for current and future benefits.

(5) 

A “purchase obligation” is an agreement to purchase goods or services that is enforceable and legally-binding on us and that specifies all significant terms, including: the fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction.

(6) 

We have not included in the table our income tax liabilities because it is not practicable to reliably estimate the timing of the related cash outflows in future years as these cash flows will only be determined after final audit by the tax authorities of previously-filed tax returns.

 

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Off-balance sheet arrangements

We have not entered into any transaction, agreement or other contractual arrangement that is considered to be an off balance sheet arrangement that is required to be disclosed other than operating lease commitments that are analyzed in note 44 to the consolidated financial statements included elsewhere in this prospectus.

Quantitative and Qualitative Disclosures About Market Risk

We are exposed to various types of market risks including the effects of adverse fluctuations in foreign currency exchange rates, adverse movements in commodity prices for products we use in our manufacturing and adverse changes in interest rates. To reduce our exposure to these risks, we maintain risk management controls and policies to monitor these risks and take appropriate actions to attempt to mitigate such forms of market risks.

The disclosure below is our general quantitative and qualitative risk after conclusion of the Transactions. Further information and quantitative analysis is included in footnote 34 of the consolidated financial statements included elsewhere in this prospectus.

Foreign currency exchange rate risks. We have global operations and thus make investments and enter into transactions denominated in various foreign currencies. Our operating results are impacted by buying, selling and financing in currencies other than the functional currency of our operating companies. From time to time, we may enter into currency derivative contracts to manage currency transaction exposures.

Interest rate risk. We are subject to interest rate market risk in connection with our long-term debt. Our principal interest rate exposure after the consummation of the Transactions relates to outstanding amounts under our senior secured credit facilities. Our senior secured credit facilities provide for variable rate borrowings of up to $2,300.0 million including availability of $300.0 million under the revolving portion of our senior secured credit facility.

Commodity price risk. We purchase certain raw materials that are subject to price volatility caused by fluctuations in supply and demand as well as other factors. To help mitigate the impact of higher commodity prices we have multiple-source and geographically diverse procurement policies and have negotiated fixed price supply contracts with many of our commodity suppliers. In addition, we continue to negotiate with our customers to provide for the sharing of increased raw material costs. From time to time, we may enter into commodity contracts to manage our exposure to changes in commodity prices.

Seasonality

Industrial & Automotive

Sales to automotive OEMs do not tend to exhibit seasonal patterns while sales into the aftermarket are generally stronger during the winter months reflecting higher levels of demand for replacement parts for vehicles during those months. Sales to Industrial OEMs are strongest from October to April for outdoor power equipment and from February to June for agricultural equipment.

For the Fluid Power segment, moderate seasonality is primarily driven by consumer demand and crop-related seasonal activities. Production of construction equipment declines in the summer months followed by a resurgence of activity in the late fall, early winter and spring. The remaining markets served by the Fluid Power segment do not exhibit significant seasonal patterns.

Building Products

Sales to the construction industry generally slow down in November and December before the Thanksgiving, Christmas and New Year holiday season and are generally stronger in the spring and summer months. Sales can also be affected regionally by severe weather. Heating product sales are more concentrated in the fall and cooling product sales in the spring.

 

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Inflation

Inflation affects the cost of raw materials, goods and services we use. High energy costs and fluctuations in commodity prices can affect the cost of all raw materials and components. We seek to mitigate the adverse effects of inflation primarily through arrangements with our customers, improved productivity and strategic buying initiatives and have historically been able to pass on cost increases to our customers as a result of rising prices for our material inputs.

RESULTS OF OPERATIONS

Q1 2011 Compared with Q1 2010

Summary

 

     Successor     Predecessor  
$ in millions    Q1 2011     Q1 2010     Pro forma
adjustments
Q1 2010		     Pro forma
Q1 2010		  

Continuing operations

         

Sales

      1,342.9        1,165.9        —          1,165.9   

Cost of sales

      (923.8 )      (801.9 )      (10.7 )      (812.6 ) 
                                

Gross profit

      419.1        364.0        (10.7 )      353.3   

Distribution costs

      (140.6 )      (125.7 )      —          (125.7 ) 

Administrative expenses

      (184.3 )      (112.9 )      (37.6 )      (150.5 ) 

Transaction costs

      (0.4 )      —          —          —     

Restructuring costs

      (5.4 )      (1.9 )      —          (1.9 ) 

Net gain on disposals and on the exit of businesses

      0.2        1.4        —          1.4   

Share of profit of associates

      0.3        0.1        —          0.1   
                                

Operating profit

      88.9        125.0        (48.3 )      76.7   
                                
 

Interest expense

      (91.1 )      (24.1 )      (66.4 )      (90.5 ) 

Investment income

      18.2        16.2        —          16.2   

Other finance income/(expense)

      11.0        (2.4 )      0.1       (2.3 ) 
                                

Net finance costs

      (61.9 )      (10.3 )      (66.3 )      (76.6 ) 
                                

Profit before tax

      27.0        114.7        (114.6 )      0.1   
                                

Sales

Sales in Q1 2011 were $1,342.9 million compared with $1,165.9 million on both an actual and pro forma basis in Q1 2010, an increase of 15.2%. I&A’s sales were 18.4% higher compared with Q1 2010, due mainly to improvements in the industrial OE and replacement markets and the automotive OE markets. Sales to the industrial markets grew by 28.1%, with sales to the Automotive OE markets growing by 15.2%. Sales to the automotive aftermarket increased by 10.0% during Q1 2011 compared with Q1 2010. Building Products’ sales for Q1 2011 were up by 2.1% compared with Q1 2010, as sales growth to the non-residential construction markets combined with the impact of the acquisition of Koch Filter (which was completed on February 26, 2010) offset the continued weakness in the construction markets, particularly the residential construction markets.

Cost of Sales

Cost of sales was $923.8 million compared with $801.9 million in Q1 2010. Pro forma cost of sales in Q1 2010 was $812.6 million. The increase of 13.7% in Q1 2011 compared with pro forma Q1 2010 was driven principally by higher production volumes.

 

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Gross Profit

Gross profit was $419.1 million compared with $364.0 million in Q1 2010. Pro forma gross profit in Q1 2010 was $353.3 million. Our gross profit margin was 31.2% in Q1 2011, broadly unchanged compared with pro forma Q1 2010.

Distribution Costs

Distribution costs increased largely in line with the increase in sales volumes to $140.6 million from $125.7 million on both an actual and pro forma basis in Q1 2010. Efficiency gains in I&A drove the slight improvement in distribution costs as a percentage of sales from 10.8% in Q1 2010 to 10.5% in Q1 2011.

Administrative Expenses

Administrative expenses were $184.3 million compared with $112.9 million in Q1 2010. Pro forma administrative expenses in Q1 2010 were $150.5 million. Administrative expenses in Q1 2011 were higher than on a pro forma basis in Q1 2010 principally because the compensation expense that was recognized in Q1 2011 in relation to the new share schemes that were put in place after the Acquisition was $22.8 million higher than that recognized in Q1 2010 on the Predecessor schemes that were operated by Tomkins. Administrative expenses as a percentage of sales increased from 12.9% on a pro forma basis in Q1 2010 to 13.7% in Q1 2011.

Restructuring Costs

Restructuring costs were $5.4 million compared with $1.9 million on both an actual and pro forma basis in Q1 2010. Restructuring costs amounting to $15.7 million were recognized during Q1 2011, principally in relation to a Group-wide initiative that focuses on identifying and implementing cost reduction opportunities and efficiency improvements. Also during Q1 2011, a provision for restructuring costs of $10.3 million was released due to the reversal of the decision to close a division of Stackpole, a business included within the Power Transmission operating segment, following the recovery in the demand for its products.

Operating Profit

Operating profit was $88.9 million compared with $125.0 million in Q1 2010. Pro forma operating profit in Q1 2010 was $76.7 million.

Adjusted EBITDA

Adjusted EBITDA was $213.2 million compared with $174.0 million in Q1 2010. Pro forma adjusted EBITDA in Q1 2010 was $173.6 million. The adjusted EBITDA margin improved to 15.9% compared with 14.9% on a pro forma basis in Q1 2010, reflecting increased cost absorption due to higher production levels driven by improved end markets, the benefit of restructuring initiatives and continuing efforts to control costs.

A reconciliation of operating profit or loss to adjusted EBITDA for each of the periods under review is presented under the heading “—Non-GAAP Measures.”

 

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Interest expense

Interest expense was $91.1 million compared with $24.1 million in Q1 2010. Pro forma interest expense in Q1 2010 was $90.5 million. Interest expense may be analyzed as follows:

 

     Successor     Predecessor  
$ in millions    Q1 2011     Q1 2010     Pro forma
adjustments
Q1 2010		     Pro forma
Q1  2010		  

Bank overdrafts

      —          2.1       —          2.1  

Interest on bank and other loans:

         

Term loans

      36.5        —          39.4       39.4  

Other bank loans

      0.7        0.4       0.3       0.7  

Second Lien Notes

      29.2        —          27.8       27.8  

2011 Notes

      3.3        4.7       (3.1 )      1.6  

2015 Notes

      0.4        5.9       (5.8 )      0.1  

Net interest on interest rate swaps

      —          (7.1 )      7.1       —     
                                
     70.1        6.0       65.7       71.7  

Finance leases

      —          0.1       —          0.1  

Other

      4.7        1.0       0.7       1.7  
                                
     74.8        7.1       66.4       73.5  

Post-employment benefits:

         

– Interest on benefit obligation

      16.3        17.0       —          17.0  
                                
     91.1        24.1       66.4       90.5  
                                

Investment income

Investment income was $18.2 million compared with $16.2 million on both an actual and a pro forma basis in Q1 2010, the increase being largely due to the improvement in the expected return on the assets held by the Group’s defined benefit pension plans.

 

     Successor     Predecessor  
$ in millions    Q1 2011     Q1 2010      Pro forma
adjustments
Q1 2010		      Pro forma
Q1 2010		  

Bank deposits

      0.8        0.8         —           0.8   

Other

      0.5        0.4         —           0.4   
                                  
     1.3        1.2         —           1.2   

Post-employment benefits:

           

– Expected return on plan assets

      16.9        15.0         —           15.0   
                                  
     18.2        16.2         —           16.2   

Other finance income/(expense)

Other finance income was $11.0 million (Q1 2010: expense of $2.4 million). Pro forma other finance expense in Q1 2010 was $2.3 million. During Q1 2011, the Group recognized a gain of $3.0 million on the change in the fair value of the interest rate floor attaching to borrowings against the Senior Secured Credit Facilities (an embedded derivative that was required to be recognized separately from the term loans).

 

     Successor     Predecessor  
$ in millions    Q1 2011     Q1 2010     Pro forma
adjustments
Q1 2010		     Pro forma
Q1 2010		  

Gain on derivatives held for hedging purposes

      —          0.6       (0.6 )      —     

Gain on embedded derivatives

      3.0       —          —          —     

Translation gain/(loss) on hedging instruments

      8.1       (3.0 )      0.7       (2.3 ) 

Loss on redemption of notes

      (0.1 )      —          —          —     
                                
     11.0       (2.4 )      0.1       (2.3 ) 

Income tax expense/(benefit)

During the Q1 2011, the income tax expense attributable to continuing operations was $19.3 million (Q1 2010: tax expense of $29.2 million) on a profit before tax of $27.0 million (Q1 2010: profit before tax of $114.7 million). On a pro forma basis, we recognized an income tax benefit of $10.5 million on a profit before tax of $0.1 million in Q1 2010.

Our effective tax rate in Q1 2011 was significantly higher than the statutory tax rates that are applicable in the jurisdictions in which we operate, principally due to the non-deductibility for tax purposes of the compensation

 

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expense recognized on share-based payments, the recognition of deferred tax liabilities on temporary differences associated with investments in subsidiaries and tax credits in relation to which we were unable to recognize deferred tax assets.

Analysis by Ongoing Business Segment

Industrial & Automotive

Market Background

During Q1 2011, the industrial markets accounted for 42.0% of I&A sales, with 21.1% to the industrial OE market and 20.9% to the industrial replacement market.

US industrial production, as measured by the US Federal Reserve Industrial Production index, grew throughout the first three months of 2011 and stood 5.9% higher in March 2011 compared with the three months to March 2010. The European industrial production index followed a similar trend. Industrial markets in Asia continued to perform strongly, with industrial production in China growing by 14% in the two months to the end of February 2011 (as measured by the National Bureau of Statistics of China). Sales to the industrial markets in North America, Europe and Asia accounted for 25.4%, 7.0% and 5.7% respectively of I&A’s sales during Q1 2011.

The automotive aftermarket, which comprised 25.1% of I&A’s sales in the first three months of 2011, grew strongly in the period driven by improved consumer confidence and underlying trends. In the US, miles driven, a key driver of vehicle repair, was up by 0.6% in the two months to February 2011 compared with the corresponding period in 2010 and the average vehicle age, which also drives replacement spending, increased during 2010.

In the automotive OE market, which accounted for 30.5% of I&A’s Q1 2011 sales, production volumes were up by 8% globally compared with Q1 2010, with March year-to-date volumes in North America up by 14%, Europe up by 6% and Asia up by 7%, compared with the corresponding period in 2010.

Power Transmission

 

$ in millions, unless otherwise stated    Successor
Q1 2011		     Predecessor
Pro  forma
Q1 2010		     Q1 2011 vs
Q1 2010
% Change		  

Sales

      592.7        519.2        14.2 % 

Operating profit

      74.4        57.7     

Adjusted EBITDA

      130.1       110.6    

Adjusted EBITDA margin

      22.0 %      21.3 %   

Sales in Q1 2011 were $592.7 million (Q1 2010: $519.2 million), an increase of 14.2%. Sales were higher principally due to the strengthening of sales to the industrial OE and replacement markets (27.5% of Power Transmission’s sales) particularly in North America, Europe and Asia driven by a continuation of the global economic recovery. Overall, sales to the industrial markets were 27.5% higher compared with Q1 2010. Sales to the higher margin automotive aftermarket (32.3% of Power Transmission’s sales) grew by 7.2% compared with Q1 2010, principally due to positive trends in miles driven, the ageing of the car population, and consumer confidence in the US. Sales to the automotive OE market (40.2% of Power Transmission’s sales) grew by 12.0% in Q1 2011 compared with Q1 2010, driven by the continued recovery in automotive production, principally in North America.

Operating profit in our Power Transmission segment was $74.4 million for Q1 2011 (Q1 2010: $90.6 million). Pro forma operating profit in Q1 2010 was $57.7 million. Depreciation and amortization amounted to $55.2 million in Q1 2011 compared with $52.7 million in pro forma Q1 2010. In Q1 2011, the compensation expense in respect of share-based incentives was $2.6 million compared with $0.4 million on a pro forma basis in Q1 2010.

Adjusted EBITDA was $130.1 million for Q1 2011 compared with $110.6 million on both an actual and a pro forma basis in Q1 2010. The adjusted EBITDA margin increased slightly to 22.0% compared with 21.3% in Q1 2010, principally as a result of higher cost absorption on the increased sales across all end markets and the benefits of the remaining restructuring initiatives completed in 2010.

 

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Fluid Power

 

$ in millions, unless otherwise stated    Successor
Q1 2011		     Predecessor
Pro  forma
Q1 2010		     Q1 2011 vs
Q1 2010
% Change		  

Sales

      234.6        180.3        30.1 % 

Operating profit

      26.1        14.0     

Adjusted EBITDA

      40.3       27.1    

Adjusted EBITDA margin

      17.2 %      15.0 %   

Sales were $234.6 million (Q1 2010: $180.3 million), an increase of 30.1%. Sales to the industrial OE market, which accounted for 35.4% of Fluid Power’s sales, were up by 48.3% in Q1 2011 compared with Q1 2010, due to the continued recovery in industrial markets, principally in North America. For the same reason, sales to the industrial replacement market, which accounted for 47.1% of Fluid Power’s sales, were up by 23.2% in Q1 2011 compared with Q1 2010. Sales to the automotive aftermarket, which accounted for 17.3% of Fluid Power’s sales, grew by 18.8% in Q1 2011 compared with Q1 2010 due to positive trends in a number of market drivers.

Operating profit in our Fluid Power segment was $26.1 million for Q1 2011 (Q1 2010: $16.7 million). Pro forma operating profit for Q1 2010 was $14.0 million. Depreciation and amortization amounted to $9.7 million in Q1 2011 compared with $10.8 million in pro forma Q1 2010. Fluid Power’s operating result included a compensation expense in respect of share-based incentives of $1.4 million for Q1 2011 compared with $0.2 million in Q1 2010, and restructuring costs of $3.1 million in Q1 2011 compared with $2.1 million in Q1 2010.

Adjusted EBITDA was $40.3 million (Q1 2010: $27.0 million). Pro forma adjusted EBITDA for Q1 2010 was $27.1 million. The adjusted EBITDA margin was 17.2% compared with 15.0% on a pro forma basis in Q1 2010, the improvement driven by a combination of greater fixed cost absorption on higher sales and the benefits of restructuring initiatives and ongoing efficiency improvement projects.

Sensors & Valves

 

$ in millions, unless otherwise stated    Successor
Q1 2011		     Predecessor
Pro  forma
Q1 2010		     Q1 2011 vs
Q1 2010
% Change		  

Sales

      120.8        99.7        21.2 % 

Operating profit

      14.1        5.6     

Adjusted EBITDA

      23.5       15.2    

Adjusted EBITDA margin

      19.5 %      15.2 %   

Sensors & Valves includes the Schrader Electronics and Schrader International businesses.

Sales were $120.8 million (Q1 2010: $99.7 million) an increase of 21.2%, principally as a result of higher volumes in the automotive OE market, which accounted for 77.9% of the segment’s sales and which grew by 23.4% in Q1 2011 compared with Q1 2010. The industrial OE and automotive aftermarket businesses, which account for the remainder of Sensors & Valves’ sales, also grew as a result of improving conditions in those markets.

Operating profit in our Sensors & Valves segment was $14.1 million for Q1 2011 (Q1 2010: $9.5 million). Pro forma operating profit for Q1 2010 was $5.6 million. Depreciation and amortization amounted to $8.9 million in Q1 2011 compared with $9.4 million on a pro forma basis in Q1 2010. Sensors & Valves’ operating result included a compensation expense in respect of share-based incentives of $0.5 million for Q1 2011 compared with $0.2 million in Q1 2010.

Adjusted EBITDA was $23.5 million for Q1 2011 compared with $15.2 million on both an actual and a pro forma basis in Q1 2010. The adjusted EBITDA margin improved from 15.2% on a pro forma basis in Q1 2010 to 19.5% in Q1 2011, driven mainly by the strong performance in the automotive OE market.

 

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Other Industrial & Automotive

 

$ in millions, unless otherwise stated    Successor
Q1 2011		     Predecessor
Pro  forma
Q1 2010		     Q1 2011 vs
Q1 2010
% Change		  

Sales

      159.5        136.3        17.0 % 

Operating profit

      8.3        3.0     

Adjusted EBITDA

      14.8       10.8    

Adjusted EBITDA margin

      9.3 %      7.9 %   

Other I&A includes the Dexter, Ideal and Plews businesses.

Sales were $159.5 million (Q1 2010: $136.3 million) an increase of 17.0%. Sales to the utility trailer market, which accounted for 41.7% of Other I&A’s Q1 2011 sales, grew by 28.0% compared with Q1 2010 due to the continued recovery in this end market. Sales to the industrial replacement market (16.4% of Other I&A’s sales) and the automotive aftermarket (15.8% of Other I&A’s sales) grew by 13.6% and 20.8% respectively during Q1 2011 compared with Q1 2010.

Operating profit in our Other I&A segment was $8.3 million for Q1 2011 (Q1 2010: $6.2 million). Pro forma operating profit for Q1 2010 was $3.0 million. Depreciation and amortization amounted to $6.0 million in Q1 2011 compared with $7.0 million on a pro forma basis in Q1 2010. Other I&A’s operating result included restructuring costs of $0.4 million for Q1 2011 compared with $0.5 million in Q1 2010.

Adjusted EBITDA was $14.8 million for Q1 2011 compared with $10.8 million on both an actual and a pro forma basis in Q1 2010. The adjusted EBITDA margin rose from 7.9% on a pro forma basis in Q1 2010 to 9.3% in Q1 2011, the improvement due principally to higher volumes and the benefit of restructuring initiatives.

Plews Inc., a wholly-owned manufacturer of automotive lubrication products and repair tools, was sold on April 20, 2011 to a consortium of investors in the US led by the private equity firm, Eigen Capital LLC. The cash consideration of $25.0 million received on the disposal approximated to the carrying amount of the net assets sold.

Building Products

Market Background

Non-residential construction in North America accounts for 61.7% of Building Products’ Q1 2011 sales. In the US, non-residential construction declined on a square foot basis by 10% for the three months to the end of March 2011 compared with the three months to the end of March 2010, and by 14% on a dollar value basis (as measured by Dodge). The US Architectural Billings Index, which is regarded as a leading indicator of future commercial construction activity, remained around 50, indicating neither growth nor contraction in future construction activity. Office vacancy rates continued to decline, reaching 16.5% in the first quarter of 2011, down from 16.7% at the end of 2010.

Residential construction in North America accounts for 30.9% of Building Products’ Q1 2011 sales. The US residential construction market continues to be weak, with seasonally adjusted annualized housing starts standing at 549,000 at the end of March, down from 587,000 at the end of December 2010. Overall, housing starts have declined by 9% in the first three months of 2011 compared with the prior year (according to the National Association of Homebuilders). Housing inventories, at 7.3 months for new homes and 8.4 months for existing homes still remain above the level at which new construction is initiated.

Air Distribution

 

$ in millions, unless otherwise stated    Successor
Q1 2011		     Predecessor
Pro  forma
Q1 2010		     Q1 2011 vs
Q1 2010
% Change		  

Sales

      207.3        197.4        5.0 % 

Operating profit

      8.0        11.6     

Adjusted EBITDA

      21.8       24.0    

Adjusted EBITDA margin

      10.5 %      12.2 %   

 

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Sales were $207.3 million (Q1 2010: $197.4 million), an increase of 5.0%. Sales to the non-residential construction markets, which accounted for 77.8% of Air Distribution’s Q1 2011 sales, improved year-on-year as a result of higher volumes in the non-residential construction market, combined with the impact of the acquisition of Koch Filter during Q1 2010.

Sales to the residential construction market, which accounted for 22.2% of Air Distribution’s Q1 2011 sales, declined by 2.4% in the first three months of 2011 due to the continued weakness of the residential construction market. Residential construction activity declined year-on-year and continues to be adversely affected by high levels of housing inventory, declining house prices and low demand.

Operating profit in our Air Distribution segment was $8.0 million for Q1 2011 (Q1 2010: $15.6 million). Pro forma operating profit for Q1 2010 was $11.6 million. Depreciation and amortization amounted to $11.2 million in both Q1 2011 and on a pro forma basis in Q1 2010. Air Distribution’s operating result included a compensation expense in respect of share-based incentives of $2.6 million for Q1 2011 compared with $0.5 million in Q1 2010. No restructuring costs were recognized in Q1 2011, but costs of $0.6 million were recognized in Q1 2010.

Adjusted EBITDA was $21.8 million (Q1 2010: $23.9 million). Pro forma adjusted EBITDA for Q1 2010 was $24.0 million. The adjusted EBITDA margin fell to 10.5% compared with 12.2% on a pro forma basis in Q1 2010, primarily as a result of higher raw material costs.

Bathware

 

$ in millions, unless otherwise stated    Successor
Q1 2011		     Predecessor
Pro  forma
Q1 2010		     Q1 2011 vs
Q1 2010
% Change		  

Sales

      28.0        33.0        (15.2 )% 

Operating loss

      (3.6 )      (2.9 )   

Adjusted EBITDA

      (0.6 )      (0.1 )   

Adjusted EBITDA margin

      (2.1 )%      (0.3 )%   

Sales were $28.0 million (Q1 2010: $33.0 million), a decline of 15.2%. Bathware sells primarily to the US residential construction and remodelling market, which has declined year-on-year.

We incurred an operating loss in our Bathware segment of $3.6 million for Q1 2011 (Q1 2010: operating loss of $1.9 million). The pro forma operating loss for Q1 2010 was $2.9 million. Depreciation and amortization amounted to $2.3 million in Q1 2011 compared with $2.8 million on a pro forma basis in Q1 2010. Bathware’s operating result for Q1 2011 included restructuring costs of $0.6 million, while no restructuring costs were incurred in Q1 2010.

Bathware incurred an adjusted EBITDA loss of $0.6 million for Q1 2011 compared with an adjusted EBITDA loss of $0.1 million on both an actual and a pro forma basis in Q1 2010, the increased loss being largely as a result of the decline in sales volumes. The adjusted EBITDA margin was (2.1)% in Q1 2011 compared with (0.3)% on a pro forma basis in Q1 2010.

Corporate

Corporate incurred an adjusted EBITDA loss of $16.4 million (Q1 2010: $12.9 million). The pro forma adjusted EBITDA loss for Q1 2010 was $13.5 million, the increase in the loss compared with Q1 2011 resulting largely from changes in foreign currency exchange rates.

 

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LIQUIDITY AND CAPITAL RESOURCES

Cash Flow

Cash generated from operations was $62.5 million in Q1 2011 compared with cash absorbed by operations of $22.9 million in Q1 2010. Operating cash flow before movements in working capital was $173.5 million compared with $135.2 million in Q1 2010, an increase of $38.3 million that was due largely to the improvement in the Group’s profitability as measured by adjusted EBITDA. Movements in working capital during Q1 2011 gave rise to a further improvement in cash generated from operations of $47.1 million compared with Q1 2010.

Cash outflow on restructurings was $7.3 million (Q1 2010: $13.9 million), net of proceeds on related asset sales of $4.3 million (Q1 2010: $6.1 million).

Gross capital expenditure was $32.2 million (Q1 2010: $25.6 million). Excluding the proceeds on asset sales arising from restructurings, net capital expenditure was $31.6 million (Q1 2010: $23.8 million).

Trading cash flow was $35.2 million (Q1 2010: outflow of $40.6 million).

The table below shows the movements in net debt:

 

$ in millions    Successor
Q1 2011		     Predecessor
Q1 2010		  

Cash generated from/(absorbed by) operations

      62.5       (22.9 ) 

Capital expenditure

      (32.2 )      (25.6 ) 

Disposal of property, plant and equipment

      4.9       7.9  
                

Trading cash flow

      35.2       (40.6 ) 

Income taxes paid (net)

      (26.4 )      (19.2 ) 

Interest paid (net)

      (80.9 )      (3.4 ) 

Financing costs paid

      (29.5 )      —     

Acquisitions and disposals (net)

      0.7       (37.8 ) 

Issue of ordinary shares

      —          (6.2 ) 

Other movements

      (19.8 )      (9.9 ) 

Foreign currency movements

      4.0       0.9  
                

Increase in net debt

      (116.7 )      (116.2 ) 
                

Borrowings

As at April 2, 2011, our borrowings principally consisted of two term loans under the senior secured credit facilities and the notes that were issued to finance the Acquisition.

Our borrowings as at April 2, 2011 may be analyzed as follows:

 

     Carrying amount      Principal amount  
     Successor     Predecessor      Successor     Predecessor  
$ in millions    As at
April 2, 2011		     As at
December 31, 2010		      As at
April 2, 2011		     As at
December 31, 2010		  

Bank overdrafts

      4.9        7.1         4.9        7.1   

Bank and other loans:

          

– Secured

          

Term Loan A

      267.9        271.2         288.6        296.0   

Term Loan B

      1,540.8        1,540.9         1,673.1        1,677.3   

Second Lien Notes

      1,075.1        1,098.3         1,150.0        1,150.0   
                                 
     2,883.8        2,910.4         3,111.7        3,123.3   

– Unsecured

          

2011 Notes

      172.5        172.2         164.2        165.5   

2015 Notes

      28.6        27.1         27.7        26.5   

Loan notes

      47.3        44.9         47.1        45.1   
                                 
     248.4        244.2         239.0        237.1   
                                 
     3,137.1        3,161.7         3,355.6        3,367.5   
                                 

 

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A reconciliation of the carrying amount to the principal amount of our borrowings is presented in note 14 to the unaudited condensed consolidated financial statements included elsewhere in this prospectus.

Re-pricing of Senior Secured Facilities

Borrowings under the Senior Secured Credit Facilities bear interest at a floating rate, which can be either LIBOR plus an applicable margin or, at our option, a base rate as defined in the credit agreement plus an applicable margin. LIBOR and the base rate are both subject to floors. On inception of the facilities, the applicable margin for the Term Loan B credit facility was 4.5% per annum for LIBOR and 3.5% per annum for base rate. The applicable margin for the Term Loan A credit facility and the revolving credit facility was between 3.75% and 4.25% per annum for LIBOR and 2.75% and 3.25% per annum for base rate depending on a total leverage to EBITDA ratio. LIBOR was subject to a 1.75% floor and base rate was subject to a 2.75% floor. Effective February 17, 2011, we agreed with the providers of the Senior Secured Credit Facilities a re-pricing of Term Loan A and Term Loan B and amendments to certain of the covenants attaching to the facilities. For both Term Loan A and Term Loan B the applicable margin for LIBOR was reduced to 3.0% per annum, with LIBOR being subject to a 1.25% floor, and the applicable margin for base rate was reduced to 2.0% per annum, with base rate being subject to a 2.25% floor. Management considered that the re-pricing did not cause a substantial change in the net present value of the expected future cash flows in relation to the facilities. Accordingly, we recognized neither a gain nor a loss on the re-pricing and recognized the associated costs of $23.4 million and the decrease of $18.1 million in the interest rate floor liability as adjustments to the carrying amounts of the borrowings outstanding under the facilities.

Borrowing headroom

As at April 2, 2011, we committed revolving credit facility of $300.0 million was undrawn for cash but there were letters of credit outstanding against the facility amounting to $39.7 million. Also, we had drawn $4.9 million against uncommitted borrowing facilities and had outstanding performance bonds, letters of credit and bank guarantees amounting to $67.9 million (in addition to those outstanding under the revolving credit facility).

Overall, therefore, our committed borrowing headroom was $187.5 million, in addition to cash balances of $376.4 million (including collateralized cash of $49.0 million).

Borrowing covenants

We are subject to covenants, representations and warranties in respect of the senior secured credit facilities including two financial covenants as defined in the credit agreement. Firstly, the ratio of consolidated total debt to consolidated EBITDA (the “total leverage ratio”) must not exceed 6.1 times (for the covenant test period ended April 2, 2011, the ratio was 3.99 times). Secondly, the ratio of consolidated EBITDA to consolidated net interest (the “interest coverage ratio”) must not be less than 1.8 times (for the covenant test period ended April 2, 2011, the ratio was 3.82 times).

Going forward, the compliance with these financial covenants will be tested for a period to the end of each calendar quarter. The limits against which the financial covenants are tested become progressively stricter for each test period until December 31, 2012. Thereafter, the total leverage ratio must not exceed 5.25 times and the interest coverage ratio must not be less than 2.1 times.

The limits for the forthcoming year are set out below:

 

     Total leverage ratio
Must not exceed		     Interest coverage ratio
Must not be less than		  

Covenant test period ended:

     

– June 30, 2011

      6.10  x      1.80  x 

– September 30, 2011

      6.00  x      1.85  x 

– December 31, 2011

      5.75  x      1.95  x 

– March 31, 2012

      5.55  x      2.00  x 

 

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Any future non-compliance with the borrowing covenants could, if not waived, constitute an event of default and may, in certain circumstances, lead to an acceleration of the maturity of borrowings drawn down and the inability to access committed facilities.

OUTLOOK

Our sales and earnings base is highly diversified by product, geography, end market and customer. We derive sales from nearly every developed country across the globe and are well-positioned in markets for our industrial and automotive components in most emerging markets.

Industrial & Automotive Markets

Industrial and automotive markets, which accounted for approximately 80% of pro forma sales in Fiscal 2010, are forecast to continue to grow in 2011. However, growth rates are expected to be lower in 2011 due to the strong performance of our end markets in 2010 and the absence in 2011 of the exceptional inventory restocking demand that we saw particularly in the first half of 2010. The following is a summary of our global outlook for I&A end markets in 2011:

 

  •  

Industrial OE markets are forecast to grow between 10 to 15%.

 

  •  

Industrial replacement markets are forecast to grow at the same pace as global industrial OE markets.

 

  •  

Global automotive OE markets are measured by vehicle production and are forecast by IHS/CSM to grow by 4.2% in 2011 to 74.8 million units.

Automotive aftermarkets, are forecast to grow between 3 to 4%, roughly at the same rate of growth as GDP in each of the respective markets.

Construction Markets

Construction markets in the U.S., which accounted for approximately 20% of our pro forma sales in Fiscal 2010, are expected to remain weak in the first half of the year while strengthening moderately in the second half. The following is a summary of our outlook for U.S. construction markets in 2011:

 

  •  

Non-residential construction markets are forecast by Dodge, to increase by 1% in 2011. However, as our products are installed later in the building process, we expect to lag the market in 2011 and forecast our non-residential sales to decline by approximately 8%.

 

  •  

Residential construction markets are measured by U.S. housing starts and are forecast to be flat in 2011, at around 600,000 housing starts. We expect that the market will improve in the second half of 2011 compared with the first half.

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. These judgments can be subjective and complex, and consequently actual results could differ materially from those estimates and assumptions. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. As with any set of assumptions and estimates, there is a range of reasonably likely amounts that may be reported.

The following critical accounting policies have been identified as those that affect the more significant judgments and estimates used in the preparation of the consolidated financial statements.

 

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Impairment of Long-Lived Assets

Goodwill, other intangible assets and property, plant and equipment are tested for impairment whenever events or circumstances indicate that their carrying amounts might be impaired. Additionally, goodwill and other intangible assets that have indefinite useful lives are subject to an annual impairment test. Due to the nature of our operations, it is generally not possible to estimate the recoverable amount for individual long-lived assets and impairment tests are usually based on the value in use of the CGU or group of CGUs to which the asset belongs.

Value in use represents the net present value of the cash flows expected to arise from the relevant CGU or group of CGUs and its calculation requires management to estimate those cash flows and to apply a suitable discount rate to them.

Management bases the estimated cash flows of the CGU or group of CGUs on assumptions such as the future changes in sales volumes, future changes in selling prices, and future changes in material prices, salaries and other costs. Management determines a discount rate for each CGU or group of CGUs using a capital asset pricing model, which is based on variables including the applicable risk-free interest rates and, for determining the cost of equity, the long-term equity risk premium and the assumed share price volatility relative to the market and, for determining the cost of debt, the assumed credit risk spreads.

As at December 31, 2010, the carrying amount of long-lived assets was $5,373.0 million. Impairment losses may be recognized on these assets within the next financial year if there are adverse changes in the variables and assumptions underlying the estimated future cash flows of the CGUs or the discount rates that are applied to those cash flows. The sensitivity of the carrying amount of goodwill to the key assumptions underlying the value in use calculations is discussed in note 20 to the consolidated financial statements presented elsewhere in this prospectus.

Inventory

Inventories are stated at the lower of cost and net realizable value, with due allowance for excess, obsolete or slow-moving items. Net realizable value is based on current assessments of future demand, market conditions and new product development initiatives. As at December 31, 2010, the carrying value of inventories was $693.5 million, net of allowances of $7.9 million. Should demand for our products decline during the next financial year, additional allowances may be necessary in respect of excess or slow-moving items.

Derivative Financial Instruments

Derivative financial instruments are recognized as an asset or a liability measured at their fair value at the balance sheet date. The fair value of derivatives continually changes in response to changes in prevailing market conditions and applicable credit risk spreads.

Where permissible under IAS 39, we use hedge accounting to mitigate the impact of changes in the fair value of derivatives on profit or loss but our results may be affected by changes in the fair values of derivatives where hedge accounting cannot be applied or due to hedge ineffectiveness.

Post-Employment Benefits

We operate pension plans throughout the world, covering the majority of its employees. Pension benefits are provided by way of both defined contribution plans and defined benefit plans. Our defined benefit pension plans are closed to new entrants. We also provide other post-employment benefits, principally health and life insurance cover, to certain of our employees in North America by way of unfunded defined benefit plans.

We account for post-employment benefits in accordance with IAS 19 ‘Employee Benefits’, whereby the cost of defined benefit plans is determined based on actuarial valuations of the plans that are carried out annually at the balance sheet date. The actuarial valuations are dependent on assumptions about the future that are made by management on the advice of independent qualified actuaries.

 

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If actual experience differs from these assumptions, there could be a material change in the amounts recognized by us in respect of defined benefit plans in the next financial year.

As at December 31, 2010, the present value of the benefit obligation was $1,258.5 million. The benefit obligation is calculated using a number of assumptions including future salary increases, increases to pension benefits, mortality rates and, in the case of post-employment medical benefits, the expected rate of increase in medical costs. The present value of the benefit obligation is calculated by discounting the benefit obligation using market yields on high-quality corporate bonds at the balance sheet date. As at December 31, 2010, the fair value of the plan assets was $1,011.1 million.

The plan assets consist largely of listed securities and their fair values are subject to fluctuation in response to changes in market conditions.

Effects of changes in the actuarial assumptions underlying the benefit obligation, effects of changes in the discount rate applicable to the benefit obligation and effects of differences between the expected and actual return on the plan assets are classified as actuarial gains and losses and are recognized in other comprehensive income. During 2010, we recognized a net actuarial gain of $70.1 million. Further actuarial gains and losses will be recognized during the next financial year.

An analysis of the assumptions that will be used by management to determine the cost of defined benefit plans that will be recognized in profit or loss in the next financial year is presented in note 35 to the consolidated financial statements presented elsewhere in this prospectus.

Taxation

We are subject to income tax in most of the jurisdictions in which we operate. Management is required to exercise significant judgment in determining our provision for income taxes.

Estimation is required of taxable profit in order to determine our current tax liability. Management’s judgment is required in relation to uncertain tax positions whereby additional current tax may become payable in the future following the audit by the tax authorities of previously-filed tax returns. It is possible that the final outcome of these uncertain tax positions may differ from management’s estimates.

Estimation is also required of temporary differences between the carrying amount of assets and liabilities and their tax base. Deferred tax liabilities are recognized for all taxable temporary differences but, where there exist deductible temporary differences, management’s judgment is required as to whether a deferred tax asset should be recognized based on the availability of future taxable profits. As at December 31, 2010, we recognized net deferred tax liabilities amounting to $779.9 million. Deferred tax assets of $825.1 million were not recognized in respect of tax losses and tax credits carried forward. It is possible that the deferred tax assets actually recoverable may differ from the amounts recognized if actual taxable profits differ from management’s estimates.

As at December 31, 2010, the aggregate amount of temporary differences associated with investments in subsidiaries for which deferred tax liabilities have not been recognized was $1,375.0 million. Deferred tax liabilities have not been recognized on these temporary differences because we are able to control the timing of their reversal and it is not probable that they will reverse in the foreseeable future. Income tax may become payable on these temporary differences if circumstances change, for example upon the repatriation of assets from the subsidiaries concerned or on the sale or liquidation of one or more of them.

Workers’ Compensation

Provision is made for claims for compensation for injuries sustained by our employees while at work. Our liability for claims made but not fully settled is calculated on an actuarial basis. Historical data trends are used to estimate the liability for unreported incidents. As at December 31, 2010, the workers’ compensation provision amounted to $21.6 million. Further provision may be necessary within the next financial year if the actual cost of settling claims exceeds management’s estimates.

 

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Environmental Liabilities

Provision is made for the estimated cost of known environmental remediation obligations in relation to our current and former manufacturing facilities. Cost estimates include the expenditure expected to be incurred in the initial remediation effort and, where appropriate, in the long-term monitoring of the relevant sites. Management monitors for each remediation project the costs incurred to date against expected total costs to complete and operates procedures to identify possible remediation obligations that are presently unknown.

As at December 31, 2010, the provision for environmental remediation costs amounted to $12.0 million. Further provision may be necessary within the next financial year if actual remediation costs exceed expected costs, new remediation obligations are identified or there are changes in the circumstances affecting our legal or constructive remediation obligations.

Product Warranties

Provision is made for the estimated cost of future warranty claims on our products. Management bases the provision on historical experience of the nature, frequency and average cost of warranty claims and takes into account recent trends that might suggest that the historical claims experience may differ from future claims. As at December 31, 2010, our provision for warranty claims amounted to $12.1 million. Further provision may be necessary within the next financial year if actual claims experience differs from management’s estimates.

ACCOUNTING PRONOUNCEMENTS YET TO BE ADOPTED

Recently-issued accounting pronouncements that may be relevant to our operations but have not yet been adopted are outlined below. Management does not expect that the adoption of the first phase of IFRS 9 and the Improvements to IFRS 2010 will have a material impact on our results or financial position. Management has not yet been able to assess the potential impact on our results or financial position of the other pronouncements.

IFRS 9 “Financial Instruments”

In November 2009, the IASB issued IFRS 9 which represents the first phase of its replacement of IAS 39 and introduces new requirements for the classification and measurement of financial assets and removes the need to separately account for certain embedded derivatives. IFRS 9 is effective for annual periods commencing on or after 1 January 2013.

“Improvements to IFRS 2010”

In May 2010, the IASB published amendments to seven IFRS that address a number of issues, including the measurement in a business combination of non-controlling interests and the un-replaced or voluntarily replaced share-based payment awards of an acquired entity, the presentation of the analysis of other comprehensive income by item and clarification of certain disclosures about financial instruments. The amendments are effective for annual periods beginning on or after either July 1, 2010 or January 1, 2011.

IFRS 10 “Consolidated Financial Statements”, IFRS 11 “Joint Arrangements” and IFRS 12 “Disclosure of Interests in Other Entities”

In May 2011, the IASB published a package of new and revised standards addressing the accounting for consolidation, involvements on joint arrangements and disclosure of involvements with other entities. Each of the standards is effective for annual periods beginning on or after January 1, 2013 with earlier adoption permitted provided each of the other standards in the package is adopted on a concurrent basis.

IFRS 10 replaces the consolidation guidance in IAS 27 “Consolidated and Separate Financial Statements” and SIC-12 “Consolidation – Special Purpose Entities” by introducing a single consolidation model for all entities based on control, irrespective of the nature of the investee, i.e. whether an entity is controlled through voting rights of investors or through other contractual arrangements.

 

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IFRS 11 introduces new accounting requirements for joint arrangements, replacing IAS 31 “Interests in Joint Ventures”. IFRS 11 classifies a joint arrangement as either a joint operation (combining the existing concepts of jointly controlled assets and jointly controlled operations) or a joint venture (equivalent to the existing concept of a jointly controlled entity). IFRS 11 requires that a joint operator recognizes its share of the assets, liabilities, revenues and expenses of the joint operation while a joint venturer would account for its interest in the joint venture using the equity method of accounting. Proportional consolidation of an interest in a joint venture will no longer be permitted.

IFRS 12 requires enhanced disclosures about both consolidated entities and unconsolidated entities in which an entity has an involvement so that users of financial statements may evaluate the basis of control, any restrictions on consolidated assets and liabilities, and the nature of and risks associated with its interests in other entities.

IFRS 13 “Fair Value Measurement”

In May 2011, the IASB issued IFRS 13 which replaces the guidance on fair value measurement that is contained in existing IFRS with a single standard. IFRS 13 does not change the requirements regarding which items should be measured or disclosed at fair value but defines fair value, provides guidance on how to determine fair value and requires disclosures about fair value measurements. IFRS 13 is effective for annual periods beginning on or after January 1, 2013 with earlier adoption permitted.

NON-GAAP MEASURES

Background

We assess the financial performance of our businesses using a variety of measures. Certain of these measures are termed “non-GAAP measures” because they exclude amounts that are included in, or include amounts that are excluded from, the most directly comparable measure calculated and presented in accordance with IFRS, or are calculated using financial measures that are not calculated in accordance with IFRS. We present below a reconciliation of each of the non-GAAP measures to the most directly comparable measure calculated and presented in accordance with IFRS and discuss its limitations. We do not regard these non-GAAP measures as a substitute for, or superior to, the equivalent measures calculated and presented in accordance with IFRS or those calculated using financial measures that are calculated in accordance with IFRS. The non-GAAP measures described below may not be directly comparable with similarly-titled measures used by other companies.

EBITDA and Adjusted EBITDA

EBITDA is a non-GAAP measure that represents profit or loss for the period before net finance costs, income taxes, depreciation and amortization. We present EBITDA because it is widely used by securities analysts, investors and other interested parties to evaluate the profitability of companies. EBITDA eliminates potential differences in performance caused by variations in capital structures (affecting net finance costs), tax positions (such as the availability of net operating losses against which to relieve taxable profits), the cost and age of tangible assets (affecting relative depreciation expense) and the extent to which intangible assets are identifiable (affecting relative amortization expense).

Adjusted EBITDA represents EBITDA before additional specific items that are considered to hinder comparison of the trading performance of our businesses either year-on-year or with other businesses. Adjusted EBITDA is the measure used by the Board to assess the trading performance of our businesses and is therefore the measure of segment profit that we present under IFRS. Adjusted EBITDA is also presented on a consolidated basis because management believes it is important to consider our profitability on a basis consistent with that of its operating segments. When presented on a consolidated basis, adjusted EBITDA is a non-GAAP measure. Management believes that adjusted EBITDA should, therefore, be made available to securities analysts, investors and other interested parties to assist in their assessment of the trading performance of our businesses.

 

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During the periods under review, the items excluded from EBITDA in arriving at adjusted EBITDA were:

 

  •  

the effect on cost of sales of the uplift to the carrying amount of inventory held by Tomkins on its acquisition by the Group;

 

  •  

the compensation expense in relation to share-based incentives;

 

  •  

transaction costs incurred in relation to business combinations;

 

  •  

impairments, comprising impairments of goodwill and intangible assets recognized in accounting for business combinations and material impairments of other assets;

 

  •  

restructuring costs;

 

  •  

the net gain or loss on disposals and on the exit of businesses; and

 

  •  

the gain recognized on amendments to certain post-employment benefit plans in North America.

When Tomkins was acquired by the Group, the carrying amount of its inventory was measured at fair value which included an uplift to its previous carrying amount to reflect the profit attributable to the production effort embodied in the inventory held at the acquisition date. When the inventory was sold during Q4 2010, the uplift to its carrying amount at the acquisition date was reflected as an addition to cost of sales. Had the Acquisition not occurred, the profit attributable to the production effort would have been recognized in profit or loss during Q4 2010. We have excluded from adjusted EBITDA the effect of the uplift on cost of sales in Q4 2010 in order that adjusted EBITDA for Q4 2010 is comparable with adjusted EBITDA in the preceding and future periods. However, to facilitate a discussion certain results of operations across periods, we have presented our results for Fiscal 2010 on a pro forma basis. For the reasons explained in “Unaudited Pro Forma Financial Information” included elsewhere in this prospectus pro forma EBITDA for Fiscal 2010 excludes the effect of the uplift to inventory and it therefore does not appear in the reconciliation of pro forma EBITDA to pro forma adjusted EBITDA for Fiscal 2010.

Differences exist among our businesses in the extent to which their employees receive share-based incentives. We therefore exclude from adjusted EBITDA the compensation expense in relation to share-based incentives in order to assess the relative trading performance of our businesses.

We exclude from adjusted EBITDA those acquisition-related costs that are required to be expensed in accordance with IFRS 3 (Revised 2008) “Business Combinations” because we do not believe that they relate to our trading performance. Similarly, we have excluded from adjusted EBITDA the advisory fees incurred by Tomkins in relation to the Acquisition.

Other items are excluded from adjusted EBITDA because they are individually or collectively material items that are not considered to be representative of the trading performance of our businesses during the periods under review. Restructuring costs and the net gain or loss on disposals and on the exit of businesses reflect specific actions taken by management to improve our future profitability; impairments of long-lived assets represent the excess of their carrying amount over the amount that is expected to be recovered from them in the future; and the gain recognized on the amendments to certain post-employment benefit plans in North America represents reductions in the benefit obligations recognized in respect of the past service of participating employees.

EBITDA and adjusted EBITDA exclude items that can have a significant effect on our profit or loss and should, therefore, be used in conjunction with, not as substitutes for, profit or loss for the period. Management compensates for these limitations by separately monitoring profit or loss for the period.

For the avoidance of any confusion, the non-GAAP measures “EBITDA” and “adjusted EBITDA” differ in certain respects to “consolidated EBITDA” as defined in the financial covenants attaching to the Senior Secured Credit Facilities.

 

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The following table contains reconciliations of the profit or loss from continuing operations to adjusted EBITDA for pro forma Fiscal 2010, Fiscal 2009 and Fiscal 2008, and, additionally, for Q1 2011 and pro forma Q1 2010:

 

    Successor     Predecessor     Successor     Predecessor     Pro  forma
adjustments		     Pro forma     Predecessor  
$ in millions   Q1 2011     Pro forma
Q1 2010		     Q4 2010     9M 2010       Fiscal 2010     Fiscal 2009     Fiscal 2008  

Profit/(loss) for the period from continuing operations

     7.7        10.6        (270.2 )      250.8       64.8        45.4        9.9       (46.5 ) 

Income tax expense/(benefit)

     19.3        (10.5 )      (32.9 )      62.8       (59.0 )      (29.1 )      28.5       38.4   
                                                               

Profit/(loss) before tax

     27.0        0.1        (303.1 )      313.6       5.8        16.3        38.4       (8.1 ) 

Net finance costs

     61.9        76.6        99.3       26.3       129.2        254.8        46.3       75.0   
                                                               

Operating profit/(loss)

     88.9        76.7        (203.8 )      339.9       135.0        271.1        84.7       66.9   

Amortization

     41.5        41.2        44.2       17.0       103.7        164.9        25.6       26.0   

Depreciation

     52.0        52.8        54.0       120.1       36.4        210.5        172.2       203.1   
                                                               

EBITDA

     182.4        170.7        (105.6 )      477.0       275.1        646.5        282.5       296.0   

Inventory uplift

     —          —          144.2       —          (144.2 )      —          —          —     

Cost of share-based incentives

     25.2        2.4        72.4       21.2       (13.5 )      80.1        11.3       12.0   

Transaction costs

     0.4        —          78.2       41.5       (119.1 )      0.6        —          —     

Impairments

     —          —          —          —          —          —          73.0       342.4   

Restructuring costs

     5.4        1.9        2.0       10.0       —          12.0       144.1       26.0   

Net gain on disposals and on the exit of businesses

     (0.2 )      (1.4 )      —          (6.3 )      —          (6.3 )      (0.2 )      (43.0 ) 

Gain on amendment of post-employment benefits

     —          —          —          —          —          —          (63.0 )      —     
                                                               

Adjusted EBITDA

     213.2        173.6        191.2       543.4       (1.7 )      732.9        447.7       633.4   
                                                               

The following tables contain reconciliations of the operating profit or loss to the adjusted EBITDA of each of our operating segments for pro forma Fiscal 2010, Fiscal 2009 and Fiscal 2008, and, additionally, for Q1 2011 and pro forma Q1 2010:

Q1 2011

 

$ in millions   Operating
profit/(loss)		     Amortization     Depreciation     Cost of share-
based
incentives		     Transaction
costs		     Restructuring
costs		     Gain on
disposals
and  on the
exit of
businesses		     Adjusted
EBITDA		  

Industrial & Automotive:

                

– Power Transmission

     74.4        29.2        26.0        2.6        —          (2.1 )      —          130.1   

– Fluid Power

     26.1        2.5        7.2        1.4        —          3.1        —          40.3   

– Sensors & Valves

     14.1        2.8        6.1        0.5        —          —          —          23.5   

– Other I&A

     8.3        2.7        3.3        0.3        —          0.4        (0.2 )      14.8   
                                                               
    122.9        37.2        42.6        4.8        —          1.4        (0.2 )      208.7   

Building Products:

                

– Air Distribution

     8.0        3.8        7.4        2.6        —          —          —          21.8   

– Bathware

     (3.6 )      0.4        1.9        0.1        —          0.6        —          (0.6 ) 
                                                               
    4.4        4.2        9.3        2.7        —          0.6        —          21.2   

Corporate

     (38.1 )      0.1        0.1        17.7        0.4        3.4        —          (16.4 ) 
                                                               

Total ongoing segments

     89.2        41.5        52.0        25.2        0.4        5.4        (0.2 )      213.5   

Exited segments

     (0.3 )      —          —          —          —          —          —          (0.3 ) 
                                                               

Continuing operations

     88.9        41.5        52.0        25.2        0.4        5.4        (0.2 )      213.2   
                                                               

 

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Pro Forma Q1 2010

 

$ in millions   Operating
profit/(loss)		     Amortization     Depreciation     Cost of share-
based
incentives		     Restructuring
costs		     (Gain)/loss
on  disposals
and on the
exit of
businesses		     Adjusted
EBITDA		  

Industrial & Automotive:

              

– Power Transmission

     57.7        28.5        24.2        0.4        (0.2 )      —          110.6   

– Fluid Power

     14.0        3.7        7.1        0.2        2.1        —          27.1   

– Sensors & Valves

     5.6        2.6        6.8        0.2        —          —          15.2   

– Other I&A

     3.0        2.7        4.3        0.1        0.5        0.2        10.8   
                                                       
    80.3        37.5        42.4        0.9        2.4        0.2        163.7   

Building Products:

              

– Air Distribution

     11.6        3.2        8.0        0.5        0.6        0.1        24.0   

– Bathware

     (2.9 )      0.5        2.3        —          —          —          (0.1 ) 
                                                       
    8.7        3.7        10.3        0.5        0.6        0.1        23.9   

Corporate

     (14.7 )      —          0.1        1.0        —          0.1        (13.5 ) 
                                                       

Total ongoing segments

     74.3        41.2        52.8        2.4        3.0        0.4        174.1   

Exited segments

     2.4        —          —          —          (1.1 )      (1.8 )      (0.5 ) 
                                                       

Continuing operations

     76.7        41.2        52.8        2.4        1.9        (1.4 )      173.6   
                                                       

Pro Forma Fiscal 2010

 

$ in millions   Operating
profit/(loss)		     Amortization     Depreciation     Cost of share-
based
incentives		     Transaction
costs		     Restructuring
costs		     (Gain)/loss
on  disposals
and on the
exit of
businesses		     Adjusted
EBITDA		  

Industrial & Automotive:

                

– Power Transmission

     209.8        113.8        98.2        6.7        —          9.0        (4.0 )      433.5   

– Fluid Power

     53.0        14.0        28.9        3.9        0.3        1.4        (0.5 )      101.0   

– Sensors & Valves

     24.7        10.5        26.3        2.1        —          (1.7 )      —          61.9   

– Other I&A

     32.2        10.8        15.9        10.9        —          1.1        0.2        71.1   
                                                               
    319.7        149.1        169.3        23.6        0.3        9.8        (4.3 )      667.5   

Building Products:

                

– Air Distribution

     47.2        13.7        32.2        7.6        0.3        1.7        0.8        103.5   

– Bathware

     (11.0 )      1.9        8.8        0.5        —          0.1        (3.2 )      (2.9 ) 
                                                               
    36.2        15.6        41.0        8.1        0.3        1.8        (2.4 )      100.6   

Corporate

     (87.4 )      0.2        0.2        48.4        —          2.0        2.3        (34.3 ) 
                                                               

Total ongoing segments

     268.5        164.9        210.5        80.1        0.6        13.6        (4.4 )      733.8   

Exited segments

     2.6        —          —          —          —          (1.6 )      (1.9 )      (0.9 ) 
                                                               

Continuing operations

     271.1        164.9        210.5        80.1        0.6        12.0        (6.3 )      732.9   
                                                               

Fiscal 2009

 

$ in millions   Operating
profit/(loss)		     Amortization     Depreciation     Cost of share-
based
incentives		     Impairments     Restructuring
costs		     (Gain)/loss
on  disposals
and on the
exit of
businesses		     Gain on
amendment
of post-
employment
benefits		     Adjusted
EBITDA		  

Industrial & Automotive:

                  

– Power Transmission

     143.0        7.5       74.3        1.9        23.2        75.6       —          (29.7 )     295.8   

– Fluid Power

     (22.8 )      8.2       25.5        0.8        12.5        26.0       —          (31.4 )     18.8   

– Sensors & Valves

     (3.5 )      1.2       23.8        0.9        —          3.2       —          —         25.6   

– Other I&A

     13.8       1.2       15.2        0.5        0.7        12.2       (0.3 )      (1.7 )     41.6   
                                                                       
    130.5       18.1       138.8        4.1        36.4        117.0       (0.3 )      (62.8 )     381.8   

 

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$ in millions   Operating
profit/(loss)		     Amortization     Depreciation     Cost of share-
based
incentives		     Impairments     Restructuring
costs		     (Gain)/loss
on  disposals
and on the
exit of
businesses		     Gain on
amendment
of post-
employment
benefits		     Adjusted
EBITDA		  

Building Products:

                  

– Air Distribution

     48.2       7.2       24.7       1.8        18.6       5.1       —          —          105.6  

– Bathware

     (12.8 )      0.1       8.3       0.2        2.5       1.6       —          —          (0.1 ) 
                                                                       
    35.4       7.3       33.0       2.0        21.1       6.7       —          —          105.5  

Corporate

     (48.2 )      0.2       0.2       5.2        15.5       0.5       0.1       (0.2 )      (26.7 ) 
                                                                       
Total ongoing segments     117.7       25.6       172.0       11.3       73.0       124.2       (0.2 )      (63.0 )      460.6  

Exited segments

     (33.0 )      —          0.2       —          —          19.9       —          —          (12.9 ) 
                                                                       
Continuing operations     84.7       25.6       172.2       11.3       73.0       144.1       (0.2 )      (63.0 )      447.7  
                                                                       

Fiscal 2008

 

$ in millions   Operating
profit/(loss)		     Amortization     Depreciation     Cost of share-
based
incentives		     Impairments     Restructuring
costs		     (Gain)/loss
on  disposals
and on the
exit of
businesses		     Adjusted
EBITDA		  

Industrial & Automotive:

                

– Power Transmission

     (70.6 )      7.8        96.1        1.3        284.6        13.8        —          333.0   

– Fluid Power

     29.0        8.8        27.3        0.6        11.7        1.9        —          79.3   

– Sensors & Valves

     27.7        1.2        26.1        0.2        1.1        0.2        —          56.5   

– Other I&A

     41.6        1.1        15.8        —          —          3.2        0.2        61.9   
                                                               
    27.7        18.9        165.3        2.1        297.4        19.1        0.2        530.7   

Building Products:

                

– Air Distribution

     61.2        6.6        26.3        1.0        34.0        3.6        —          132.7   

– Bathware

     (14.2 )      0.2        9.6        0.1        —          2.2        —          (2.1 ) 
                                                               
    47.0        6.8        35.9        1.1        34.0        5.8        —          130.6   

Corporate

     (37.3 )      0.3        0.1        8.8        —          0.3        —          (27.8 ) 
                                                               

Total ongoing segments

     37.4       26.0        201.3        12.0        331.4        25.2        0.2        633.5   

Exited segments

     29.5        —          1.8        —          11.0        0.8        (43.2 )      (0.1 ) 
                                                               

Continuing operations

     66.9        26.0        203.1        12.0        342.4        26.0        (43.0 )      633.4   
                                                               

Adjusted EBITDA Margin

Adjusted EBITDA margin is a non-GAAP measure that represents Adjusted EBITDA expressed as a percentage of sales.

We use Adjusted EBITDA margin to measure the success of our businesses in managing their cost base and improving profitability.

 

    Successor     Predecessor     Successor     Predecessor     Pro forma
adjustments		     Pro forma     Predecessor  
$ in millions, unless otherwise stated   Q1 2011     Pro forma
Q1 2010		     Q4 2010     9M 2010       Fiscal 2010     Fiscal 2009     Fiscal 2008  

Continuing operations

                

Sales

     1,342.9        1,165.9        1,289.2       3,564.7       —          4,853.9       4,180.1       5,515.9   

Adjusted EBITDA

     213.2        173.6        191.2       543.4       (1.7 )      732.9       447.7       633.4   

Adjusted EBITDA margin

     15.9 %      14.9 %      14.8 %      15.2 %      —          15.1 %      10.7 %      11.5 % 

 

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Trading cash flow

Trading cash flow is a non-GAAP measure that we use as a measure of the cash generated by our businesses from their trading activities.

Trading cash flow represents cash generated from operations less net capital expenditure (cash outflows on the purchase of property, plant and equipment and non-integral computer software, less proceeds on the disposal of property, plant and equipment).

A reconciliation of cash generated from operations to trading cash flow is presented in the analysis of the movement in net debt presented under “Net debt” below.

 

    Successor     Predecessor     Aggregated     Successor     Predecessor  
$ in millions   Q1 2011     Q1 2010     Fiscal 2010     Q4 2010     9M 2010     Fiscal 2009     Fiscal 2008  

Total operations

              

Trading cash flow

     35.2        (40.6 )      152.9       8.8       144.1       422.0       442.8   

Trading cash flow reflects net capital expenditure which may fluctuate considerably from one year to another in an individual business, depending on the timing of capital projects and asset disposals. Management, therefore, uses trading cash flow in conjunction with, not as a substitute for, cash generated from operations in assessing the cash generation of our businesses.

Net debt

Management uses net debt, rather than the narrower measure of net cash and cash equivalents which forms the basis for the consolidated cash flow statement, as a measure of our liquidity and in assessing the strength of our balance sheet.

Net debt represents the net total of:

 

  •  

the principal amount of our borrowings (bank overdrafts and bank and other loans);

 

  •  

the carrying amount of finance lease obligations;

 

  •  

the carrying amount of cash and cash equivalents and collateralized cash (included in trade and other receivables); and

 

  •  

the fair value of the foreign currency derivatives that are held to hedge foreign currency translation exposures.

Net debt may be analyzed as follows:

 

     Successor     Predecessor  
$ in millions    As at
April 2, 2011		     As at
December 31, 2010		     As at
January 2, 2010		     As at
January 3, 2009		  

Total operations

         

Borrowings:

         

– Bank overdrafts

      (4.9 )      (7.1 )      (4.8 )      (13.7 ) 

– Bank and other loans

      (3,350.7 )      (3,360.4 )      (646.1 )      (735.3 ) 
                                
     (3,355.6 )      (3,367.5 )      (650.9 )      (749.0 ) 

Obligations under finance leases

      (3.4 )      (3.3 )      (4.6 )      (6.9 ) 
                                

Debt

      (3,359.0 )      (3,370.8 )      (655.5 )      (755.9 ) 

Cash and cash equivalents

      327.4       459.3       445.0       291.9  

Collateralized cash

      49.0       47.0       2.1       3.8  

Foreign currency derivatives

      0.9       (0.5 )      (3.0 )      (19.7 ) 
                                

Net debt

      (2,981.7 )      (2,865.0 )      (211.4 )      (479.9 ) 
                                

 

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A reconciliation of the carrying amount to the principal amount of our borrowings is presented in note 30 to the consolidated financial statements.

Analysis of movements in net debt

We present below an analysis of the movement in net debt that shows the effect on net debt of each of the items presented in the consolidated cash flow statement.

 

     Successor     Predecessor     Aggregated     Successor     Predecessor  
$ in millions    Q1 2011     Q1 2010     Fiscal 2010     Q4 2010     9M 2010     Fiscal 2009  

Cash generated from/(absorbed by) operations

      62.5       (22.9 )      281.5       66.3       215.2       532.1  

Capital expenditure:

             
                                                

— Purchase of property, plant and equipment

      (31.2 )      (24.6 )      (150.2 )      (60.2 )      (90.0 )      (115.2 ) 

— Purchase of computer software

      (1.0 )      (1.0 )      (5.7 )      —          (5.7 )      (7.8 ) 
                                                
     (32.2 )      (25.6 )      (155.9 )      (60.2 )      (95.7 )      (123.0 ) 

Disposal of property, plant and equipment

      4.9       7.9       27.3       2.7       24.6       12.9  
                                                

Trading cash flow

      35.2       (40.6 )      152.9       8.8       144.1       422.0  

Tax:

             
                                                

— Income taxes paid

      (26.5 )      (20.5 )      (88.5 )      (22.3 )      (66.2 )      (50.3 ) 

— Income taxes received

      0.1       1.3       47.1       1.4       45.7       31.2  
                                                
     (26.4 )      (19.2 )      (41.4 )      (20.9 )      (20.5 )      (19.1 ) 

Interest and preference dividends:

             
                                                

— Interest element of finance lease rental payments

      (0.1 )      (0.1 )      (0.2 )      —          (0.2 )      (0.4 ) 

— Interest received

      0.5       1.1       14.7       1.4       13.3       3.6  

— Interest paid

      (81.3 )      (4.4 )      (73.3 )      (58.1 )      (15.2 )      (37.5 ) 
                                                
     (80.9 )      (3.4 )      (58.8 )      (56.7 )      (2.1 )      (34.3 ) 

Ordinary dividends

      —          —          (56.9 )      —          (56.9 )      (48.3 ) 

Acquisitions and disposals:

             
                                                

— Purchase of subsidiaries, net of cash acquired

      (1.4 )      (36.8 )      (4,576.2 )      (4,535.0 )      (41.2 )      (26.5 ) 

— Sales of businesses and subsidiaries, net of cash disposed

      2.5       (1.0 )      —          4.0       (4.0 )      0.7  

— Debt acquired on acquisition of subsidiaries

      (0.4 )      —          —          —          —          (7.8 ) 

— Investment in associates

      —          —          (0.5 )      (0.5 )      —          (2.7 ) 
                                                
     0.7       (37.8 )      (4,576.7 )      (4,531.5 )      (45.2 )      (36.3 ) 

Ordinary share movements:

             
                                                

— Issue of ordinary shares

      —          —          2,147.8       2,142.3       5.5       0.1  

— Purchase of own shares

      —          (6.2 )      (6.2 )      —          (6.2 )      (1.4 ) 
                                                
     —          (6.2 )      2,141.6       2,142.3       (0.7 )      (1.3 ) 

Other movements:

             
                                                

— Capitalization of development costs

      —          (0.2 )      (2.8 )      (2.3 )      (0.5 )      (0.6 ) 

— Dividends received from associates

      0.5       0.2       0.5       —          0.5       0.3  

— Financing costs paid

      (29.5 )      —          (182.4 )      (182.4 )      —          (6.3 ) 

— Settlement of interest rate swaps

      —          —          64.7       —          64.7       —     

— Premium on redemption of notes

      (0.4 )      —          (4.6 )      (4.6 )      —          —     

— Investment by a minority shareholder in a subsidiary

      —          —          11.7       11.7       —          4.7  

— Dividend paid to a minority shareholder in a subsidiary

      (19.9 )      (9.9 )      (12.0 )      —          (12.0 )      (8.7 ) 
                                                
     (49.3 )      (9.9 )      (124.9 )      (177.6 )      52.7       (10.6 ) 

Foreign currency movements:

             
                                                

— Net cash and cash equivalents

      1.9       1.4       (44.3 )      (45.6 )      1.3       4.8  

 

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     Successor     Predecessor     Aggregated     Successor     Predecessor  
$ in millions    Q1 2011     Q1 2010     Fiscal 2010     Q4 2010     9M 2010     Fiscal 2009  

— Other net debt

      (6.5 )      37.0       22.3       1.4       20.9       (48.1 ) 

— Receipts/(payments) on foreign currency derivatives

      8.6       (37.5 )      (22.5 )      (2.2 )      (20.3 )      39.6  
                                                
     4.0       0.9       (44.5 )      (46.4 )      1.9       (3.7 ) 
                                                

Cash movement in net debt

      (116.7 )      (116.2 )      (2,608.7 )      (2,682.0 )      73.3       268.4  
                                                

Non-cash movements

      —          —          (44.9 )      (44.9 )      —          —     
                                                

(Increase)/decrease in net debt

      (116.7 )      (116.2 )      (2,653.6 )      (2,726.9 )      73.3       268.4  
                                                

 

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BUSINESS

Company Overview

We are a diversified global engineering and manufacturing company with a portfolio of market-leading businesses. Our products are highly engineered and used in the industrial, automotive and construction end markets. We have a broad collection of premier brands that are among the most globally recognized in their respective end markets, and we estimate that approximately 80% of our sales for Fiscal 2010 were derived from businesses that hold the number one position in the markets in which they operate. Approximately 38% of our Fiscal 2010 sales were generated from the global industrial replacement end market and automotive aftermarket, where we achieve higher margins. Our industrial replacement business provides us with exposure to a broad range of industrial end market segments that have an ongoing need for replacement parts, while the automotive aftermarket provides us with a stable source of revenue. The significant majority of our products, including those useful for the reduction of energy consumption and for safety improvement, are positioned in the premium end of their respective end markets, and as a result, allow for associated premium pricing. The prices of our products are low relative to the potential cost of their failure within the critical systems in which they are used, such as industrial machinery, automotive engines and HVAC systems. We attribute our end market leadership positions to a combination of our brand strength, product quality and breadth and customer service and support. We are led by an experienced, proven management team that has successfully streamlined our portfolio to focus on our core businesses, and implemented wide-ranging, significant cost-saving restructuring initiatives.

Our revenue and earnings base is highly diversified by product, geography, end market and customer. We derive revenues from nearly every developed country across the globe and are well-positioned in most emerging markets with our industrial and automotive component products. In addition, our top ten customers represented only 23% of our Fiscal 2010 sales. We maintain long-standing customer relationships and have served our top 20 customers for an average of over 35 years, while some of our largest customer relationships span over 50 years. We also have developed strong relationships with industry-leading customers in emerging markets including Chery, Tata and Mahindra & Mahindra.

Our product portfolio consists of tens of thousands of SKUs, and we believe it comprises the broadest range of power transmission belts, fluid power hoses and air distribution products in the end markets in which we operate. This breadth, combined with our brand reputation, product quality, superior field sales and service support, long-standing customer relationships and ability to deliver on short lead times, has allowed us to establish and maintain our leading market positions.

Our History

We were founded in 1925 as F.H. Tomkins Buckle Company, a small British manufacturer of buckles and fasteners. In the 1980’s and 1990’s we embarked on a succession of acquisitions, which rapidly grew our sales, product range and global reach. Major acquisitions included the U.S.-based Gates Corporation in 1996, which signaled a move into the industrial and automotive markets and the Stant and Schrader businesses that further bolstered this division. We also expanded our businesses into the North American residential and non-residential construction markets and several other end markets through additional acquisitions. Recognizing the need to strengthen and build upon our market leadership positions in core engineering markets, we began a process of streamlining our activities by disposing of a number of businesses during the period from 1998 to 2001.

Jim Nicol joined us as CEO in 2002 and implemented a strategy of divesting under-performing and lower margin businesses, while also acquiring businesses with higher growth and margin potential such as A.E. Hydraulic and Fleximak, in order to create a globally diversified portfolio of market-leading industrial businesses. In our Air Distribution group there have been a number of strategic acquisitions that have provided strong product, manufacturing and customer synergies, and, in the case of Trion, have allowed for an important manufacturing capability in Asia. Today, our businesses are focused on lean manufacturing, sharing best practices, product innovation and geographic expansion.

 

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Our Competitive Strengths

Industry Leading Businesses with Premier Brands. We believe that we hold the number one market position in businesses that comprise approximately 80% of our Fiscal 2010 sales. We have achieved this leadership position by offering high quality products, industry-leading product portfolios that typically consist of tens of thousands of SKUs and superior customer service and field sales support, all of which drive brand loyalty and secure our long-standing brand reputations and customer relationships. The strength of our brands has been highlighted by our demonstrated ability to pass through or adjust prices for changes in input costs, and in certain markets to charge a premium price relative to our competitors. Our principal brands include the following:

 

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Gates is the world’s largest manufacturer of power transmission belts and a leader in hydraulic and industrial hoses and couplings. The Gates brand has existed since 1917 and is globally synonymous with premium quality, reliability and customer service. Gates has approximately a 30% share of the overall automotive aftermarket for power transmission and fluid power products in North America. In its target market, which is the “do-it-for-me” traditional and retail, light vehicle automotive aftermarket in North America, Gates has a 40% share. In Europe, we estimate that Gates has approximately a 65% share of the synchronous belt market and approximately a 35% share of the accessory drive belt market.

 

  •  

ASC, Ruskin and Hart & Cooley are three of the leading manufacturers of air distribution products in North America. Each of our primary Air Distribution brands maintains a share in excess of 30% of their respective product categories, and ASC, through several brands, has a share in excess of 50% of the market for commercial GRDs in the United States.

 

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Schrader is the world leader in TPMS for passenger vehicles with a global market share of approximately 50%.

 

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Dexter is North America’s leading manufacturer of axles used in specialty utility, industrial and recreational trailers, which are typically made-to-order, with a U.S. market share in excess of 50% for those products.

 

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Ideal is the leading gear clamp manufacturer with a market share in the United States of approximately 60%.

 

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Aquatic is the leading producer of value-oriented fiberglass bathtubs, accounting for approximately 30% of all fiberglass bathtubs sold in 2009 in the United States.

Diversified Revenue and Earnings Base. We benefit from serving a diverse group of end markets and customers across the globe. This diversity helps mitigate the impact of any individual decline in any one end market during a given year. Approximately 38% of our Fiscal 2010 sales were generated from the global industrial replacement end market and automotive aftermarket, where we achieve higher margins. Our industrial replacement business provides us with exposure to a broad range of industrial end market segments that have an ongoing need for replacement parts. Our customer base consists of many of the world’s leading companies in their respective end markets, and it is broad and distinct across our segments, with no single customer representing more than 7% of our Fiscal 2010 sales. We generate revenue in most developed countries across the globe, and our emerging market presence has grown rapidly to now represent approximately 22% of our Fiscal 2010 I&A sales.

Broad Product Offering of Highly Engineered and Critical Components. Our broad product portfolio consists of tens of thousands of SKUs, which allows us to provide our customers with a comprehensive range of products. Most of our products are highly engineered components that perform critical functions within larger and more expensive systems, including industrial machinery, automotive engines and commercial HVAC applications. The prices of our products are low relative to the potential cost of their failure within the critical systems in which they are used. Our engineering and new product development capabilities have contributed to our reputation as an innovator, solidifying our leadership position across our product categories. Additionally, our extensive product portfolio, strong brand reputation, intellectual property, knowledge and expertise applied across our broad range of SKUs, make us a valued partner to our customers and increases their reluctance to switch suppliers. Working with our customers to design and develop solutions tailored to their individual specifications is a valuable service that we provide, which further decreases their propensity to switch suppliers.

 

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Long-Standing Customer and Distributor Relationships. We have cultivated long-standing customer relationships due to our strong brand reputation, consistent ability to meet product availability requirements, superior customer service and best-in-class quality. Some of our relationships with our largest customers span over 50 years. Our relationships with our top 20 customers have existed for more than 35 years on average. We believe we have cultivated relationships with an estimated 75% of the U.S. and European wholesale distributors to the automotive aftermarket, and are a key supplier to three of the largest North American distributors and retailers, NAPA, O’Reilly Auto Parts (both more than 50 years) and CARQUEST (approximately 45 years). In Europe, we have long-standing customer relationships with the leading automotive aftermarket distributors in each of Germany, France and the U.K. We maintain relationships with the largest global industrial replacement distributors, including Motion Industries (approximately 45 years) and Kaman (approximately 40 years). We have also cultivated exclusive relationships with over 100 leading distributors in the North American non-residential and residential construction end markets and maintain thousands of relationships for broad market coverage. Our extensive distribution network, comprehensive product portfolio and made-to-order components make it difficult for smaller domestic and emerging market competitors to penetrate our end markets.

Low-Cost Manufacturing and Global Engineering Footprint. Many of our manufacturing facilities are located in low-cost, emerging markets, including China, Mexico, Brazil, India, Eastern Europe and Turkey. We have substantially rebased our manufacturing footprint towards lower cost, higher growth regions, as we have opened, among other things, three new facilities in China, India and Turkey, while closing approximately 30% of our North American and European facilities in 2008 and 2009. As a result, we are positioned to realize continued margin growth as our end markets recover. We have already realized some of this margin expansion with the ongoing Adjusted EBITDA margin increasing 570 basis points (“bps”) between the first half of 2009 and Fiscal 2010. Continued international expansion allows us to conduct our engineering and manufacturing activities close to our customers across the globe, as well as to develop new relationships and to benefit from the higher growth rates in emerging markets.

Strong Margins and Free Cash Flow Generation. Our operating model generates strong profit margins and stable cash flows. In Fiscal 2010 we achieved an ongoing Adjusted EBITDA margin of 15.1% compared with 11.1% in Fiscal 2009 and 12.0% in Fiscal 2008. We achieved this improvement in part through our two broad plant rationalization programs that were largely completed in 2008 and 2009, which we refer to as projects Eagle and Cheetah. Under these initiatives we closed more than 30 loss-making, redundant and underperforming facilities in North America and Western Europe and exited low-margin and unprofitable automotive OEM businesses, which were capital intensive, as well as unprofitable Building Products businesses. After significant investments in lower cost regions, we currently have relatively lower capital expenditure requirements than we did in the past, which we expect to continue even if the end market recovery accelerates.

Experienced and Proven Management Team. We are led by an experienced management team that implemented a successful and significant restructuring program and reshaped our business portfolio through an extensive divestiture and rationalization program. Our management team is led by Jim Nicol who joined Tomkins in 2002 as CEO. Under his leadership, we have:

 

  •  

Executed projects Eagle and Cheetah, which we estimate will generate approximately $150 million in annual savings from 2011 onwards.

 

  •  

Divested or closed 26 non-core lower margin and commodity businesses to focus on higher margin, less capital intensive businesses.

 

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Established a portfolio of industry-leading industrial, automotive and building product businesses.

 

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Improved the ongoing Adjusted EBITDA margin by 310 bps in Fiscal 2010 compared with Fiscal 2008, despite sales being approximately 18% below the pre-restructuring levels of Fiscal 2007.

 

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  •  

Embedded a culture of pay for performance throughout our organization.

Business Strategies

Leverage the Gates Brand. We will continue to leverage our Gates brand and footprint, which is globally recognized by our customers as the highest quality power transmission belt brand and a leader in the fluid power market. We aim to enhance Gates’ strong reputation for superior quality, reliability and customer service by growing our service and distribution capabilities in the global industrial OEM and replacement end market and automotive aftermarket. We will also continue to invest in: (i) product development, such as our polyaramid-reinforced belts for motorcycles, carbon cord polychain belts, molded fabric belts used in high torque engines, belt boxes within wind turbines, ocean wave power generation systems and oil and gas applications and (ii) service capabilities, such as installing, monitoring, refurbishing and advising on system design for hydraulic applications in the oil and gas, marine and mining end market segments.

Utilize Global Presence and Brand Strength to Further Penetrate Emerging Markets. We continue to expand our market share in emerging markets such as China, Brazil, India and Eastern Europe, and our sales to emerging markets have grown from approximately 10% of I&A sales in 2004 to approximately 22% in Fiscal 2010. Gates has established and maintained a sales and manufacturing presence in both China and India since 1995. We have authorized distributors in almost all of China’s provinces, that have a total of over 130 retail stores across the country. We have recently completed new facilities to serve these markets, including our Fluid Power plant in Changzhou, China, which became operational in early 2010 and is the largest fluid power facility in our portfolio. We have also expanded our operations in India, Eastern Europe and Turkey, where we believe the recent high growth of light vehicle sales and industrial activity are expected to continue in the future. The automotive aftermarket opportunity in many of these emerging markets remains in its early stages as the average age of vehicles in these markets is currently lower than the age range that generates the most aftermarket activity, which is approximately five to ten years. Additionally, industrial activity is expected to increase with economic growth, which drives the industrial OEM and replacement end markets. We believe that exposure to these geographies will continue to drive our growth as automotive production increases, the aftermarket develops and general infrastructure and economic growth continues to expand at attractive rates.

Capitalize on Demand for Energy Efficient Products. We believe that we were among the first manufacturers to identify the growing environmentally-focused product trends in our industries and end markets. We continue to engineer products to enhance their energy and fuel efficiency. Such products include synchronous timing belts for micro-hybrid systems, TPMS and variable vane oil pumps in our I&A businesses and energy recovery ventilators in our Building Products business. Demand for the advanced technology content integrated into these products continues to grow. In addition, a number of new regulatory guidelines in North America have emerged to promote energy efficient products in new non-residential and residential construction.

Further Enhance Margins and Free Cash Flow Generation. We will continue to develop product offerings across our businesses that contain proprietary technology and leverage our strong brands resulting in an ability to offer premium products and generate attractive margins. In response to a difficult economic climate, we have also reduced our fixed cost base. In 2008 and 2009, we substantially completed all of our comprehensive restructuring initiatives (projects Eagle and Cheetah), closing over 30 facilities and reducing headcount under these initiatives by 7,800. We anticipate reaching the full run-rate savings of $150 million during 2011. Our continual performance improvement initiatives within our plants is expected to enhance our margins further. We also believe our available manufacturing capacity and existing geographical plant footprint is sufficient to support significant increases in volume, which will result in positive operating leverage as the economy recovers. Additionally, many of our more capital-intensive operations, including several of our low-margin, more commodity-oriented automotive OEM businesses, have been divested over the past few years as part of a full-scale management initiative to focus on higher margin, lower capital intensity businesses.

Target Opportunities for Which There is a Significant Replacement Market. We will continue to develop our technology to manufacture market-leading products and then follow with aftermarket sales and support using such technology. This strategy has been successful across the Gates brand where products were customized for use in systems designed by OEMs then sold directly to the aftermarket to satisfy replacement needs. We have taken a similar approach in other areas such as Schrader with TPMS. We believe the aftermarket will continue to develop

 

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following the regulation-induced OEM adoption of the technology in the United States and Europe. R&R activities, which are becoming a growing revenue driver in our Building Products business group, accounted for 25% of Air Distribution’s Fiscal 2010 sales.

Capitalize on Eventual Cyclical End Market Recovery. Although all of our end markets were impacted by the recent global economic recession to varying degrees, we believe many of our end markets have troughed and are experiencing varying degrees of recovery, with ongoing sales up 17% in Fiscal 2010 over Fiscal 2009, driven by increased demand throughout our global industrial and automotive end markets, as well as some amount of inventory re-stocking at our customers.

Continue to Evaluate Strategic Opportunities. We will continue to evaluate our portfolio on a strategic basis and seek to expand our presence in emerging markets. We may also consider divesting non-core businesses that may be less strategic in order to accelerate the deleveraging of our balance sheet.

Our Segments

Our business is divided into two business groups: I&A, which accounted for 80% of our Fiscal 2010 sales, and Building Products, which comprised the remaining 20% of our Fiscal 2010 sales. Our I&A businesses include: (i) Gates—the leading global manufacturer of power transmission belts and related products, as well as hydraulic and industrial hose and couplings; (ii) Schrader—the global leader in automotive TPMS; (iii) Dexter—the leading North American manufacturer of axles used in utility, industrial and recreational trailers; and (iv) several other businesses. Our Building Products businesses collectively are the leading North American manufacturer of products used in the HVAC systems of commercial and residential buildings, including GRDs, terminal units, dampers, louvers and smoke vents, among other products. We also manufacture bathtubs and shower enclosures primarily used in residential applications.

Industrial & Automotive

The Industrial & Automotive business group manufactures a wide range of systems and components for the industrial and automotive markets, principally through its four ongoing operating segments: (i) Power Transmission, (ii) Fluid Power, (iii) Sensors & Valves and (iv) Other Industrial & Automotive. I&A has corporate offices in the United States and Canada. We supply a wide variety of industries, including the transportation, energy and natural resources and agricultural markets. Our products are sold through a range of distribution channels: direct to customers (principally for the OEM end market) and through distributor channels (principally for the aftermarket business). The primary raw materials used by I&A are rubber materials, steel and a range of fibers and fabrics, all of which are principally sourced locally.

Power Transmission

LOGO

Power Transmission. We are the world’s largest manufacturer of power transmission belts used in industrial equipment and automotive applications. Our Power Transmission products are sold under the Gates brand

 

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and include highly-engineered rubber and polyurethane accessory drives and synchronous belts, idler pulleys and tensioners. We are globally integrated with operations in 21 countries and maintain research, development and engineering capabilities worldwide. The largest component of our Power Transmission sales is to leading distributors for use in the industrial replacement end market and automotive aftermarket, which are higher margin businesses. The industrial replacement end market covers a broad range of industries, which have an ongoing need for replacement parts. The automotive aftermarket provides us with a stable source of revenue. We supply aftermarket belts and related components for substantially all light vehicles in North America and Europe. We also sell Power Transmission products directly to industrial and automotive OEMs. For Fiscal 2010, 63% of Power Transmission’s automotive OEM sales were to customers located outside of North America, primarily in continental Europe and Asia, including Renault, PSA/Peugeot, Mercedes, Hyundai and Chery. The end market segments for our industrial products are broad and primarily cover applications such as general industrial, agricultural equipment and motorcycles. We also have a nascent presence in elevators, white goods and wind turbines. The industrial replacement end market and automotive aftermarket collectively represented 49% of Power Transmission’s Fiscal 2010 sales, while 41% of Fiscal 2010 sales were to the automotive OEM end market. The remaining 10% of Fiscal 2010 sales were generated from the industrial OEM end market.

Fluid Power

LOGO

Fluid Power. We are a leading manufacturer of hydraulic hoses, couplings and transfer hoses used in industrial applications and in the automotive aftermarket. Our hydraulic hoses and couplings are used in technically demanding operations and must be able to withstand extreme operating conditions. Our Fluid Power products are sold under the Gates brand and are used in a variety of end market segments, such as general industrial, construction, agriculture, oil and gas, mining and energy. We have continued to broaden our Fluid Power platform by providing hydraulic service offerings (e.g., tracking, monitoring and replacement, as well as hydraulic flushing services) to the oil and gas, marine and mining end market segments. Fluid Power has a global footprint across 13 countries and serves customers worldwide such as Motion Industries, John Deere, JCB, Bobcat and Caterpillar. The industrial replacement end market accounted for 49% of Fluid Power’s Fiscal 2010 sales, while 31% of Fiscal 2010 sales were to the industrial OEM end market and 20% of Fiscal 2010 sales were to the automotive aftermarket.

Sensors & Valves

LOGO

 

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Sensors & Valves. Through our Schrader Electronics and Schrader International businesses we are the global leader in TPMS and maintain a share of approximately 50% of the global market for TPMS products. This technology allows drivers to remotely monitor their vehicle’s tire pressure using electronic sensors attached to tire valves. Currently, our TPMS products are sold primarily to automotive OEMs that produce passenger vehicles for the U.S. market, where TPMS has been a mandatory safety system on all light vehicles since 2007. Recent legislation was passed in Europe that will mandate the use of TPMS on all new models introduced into the European passenger vehicle market starting in 2012, and all newly manufactured passenger vehicles starting in November 2014. This new legislation is expected to double the TPMS market size by the end of 2014. In addition, we believe there will be a significant aftermarket opportunity in both the United States and Europe for our Sensors & Valves products as the installed base of vehicles with TPMS continues to grow.

Other I&A

LOGO

Other I&A. Other I&A is comprised of three businesses, Dexter and Ideal. Dexter accounts for more than half of Other I&A’s sales. Dexter is the leading manufacturer of axle components for the utility, industrial trailer and recreational vehicle end market segments in the United States. Dexter sells products directly to OEMs and through national distributors. Ideal is the leading manufacturer of gear clamps primarily for the automotive aftermarket and sells principally in the United States, Mexico and China under a variety of brands. Plews, a wholly-owned manufacturer of automotive lubrication products and repair tools, was sold on April 20, 2011 to a consortium of investors in the US led by the private equity firm, Eigen Capital LLC. In Fiscal 2010, Plews’ sales were approximately $70 million. The cash consideration of $25 million received on the disposal approximated to the carrying amount of the net assets sold.

Industrial & Automotive End Markets

We operate a portfolio of global, market-leading businesses that manufacture and sell branded products for the industrial OEM and replacement, automotive OEM, automotive aftermarket, non-residential construction and residential construction end markets. Each end market has unique characteristics and drivers that contribute to our overall revenue diversification, stability and provide broad exposure to general economic growth. We expect that the cyclical nature of the industrial and automotive OEM end markets and the industrial aftermarket will benefit us to the extent there continues to be a recovery from recessionary lows. Additional end market demand characteristics that we believe we will continue to benefit from are:

 

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the resilience, stability and higher-margin nature of the automotive aftermarket principally in North America and Europe; and

 

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the continued secular growth in industrial and automotive OEM and replacement end markets in emerging markets globally.

Industrial OEM & Replacement. We generated 32% of our Fiscal 2010 sales from the global industrial OEM and replacement end markets. Our Power Transmission and Fluid Power segments operating under the Gates brand accounted for 76% of our Fiscal 2010 sales to the industrial OEM and replacement end markets. Our industrial belts are used in manufacturing equipment, commercial vehicles, agricultural and construction equipment as well as a broad range of consumer and industrial products and applications. Our industrial fluid power products are used within hydraulic systems, for example, on construction equipment and to transfer and convey fluids, as well as food, water, steam, oil, chemicals, gas and air and serve the general industrial, construction, agriculture, oil and gas, marine and mining industries.

We believe the demand for our products in the industrial OEM and replacement end markets will continue to be driven by:

 

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the level of industrial production and capacity utilization, both of which still remain below long-term averages in North America and Europe;

 

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the level of durable goods orders and operating expenditures related to consumable items used in industrial production;

 

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the level of construction activity which drives demand for construction equipment that utilize our products;

 

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the level of global commodity prices that impact demand and utilization of equipment in a number of our end market segments including agriculture and oil and gas; and

 

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continued emerging market growth and infrastructure build.

Automotive OEM. We generated 25% of our Fiscal 2010 sales from supplying the global automotive OEM end market. Our Power Transmission segment operating under the Gates brand accounted for 73% of our Fiscal 2010 sales for this end market. The demand in this end market is directly related to global vehicle production. According to IHS/CSM, from 2000 through 2010, annual light vehicle production averaged 14.6 million units in North America and 19.5 million units in Europe. Current automotive industry conditions in North America and Europe have demonstrated early signs of recovery, though are still significantly below long-run averages. In 2010, North American production recovered to 11.9 million units from 8.6 million units the year before. In Europe, production increased by 13%, rising from 16.3 million units in 2009 to 18.5 million units in 2010. Approximately 11% of our automotive OEM sales are derived from the Chinese market where production grew at an annualized growth rate of 24% between 2004 and 2010. IHS/CSM forecasts 2011 to 2015 annualized light vehicle production growth of 6% globally, with 5% in North America, 5% in Europe and 7% in China. Evolving consumer preferences and recent regulations have made fuel economy and safety systems a growth area for automotive OEM suppliers, which we believe will benefit our business. Many of the products that we sell to the automotive OEM end market have been shown to improve safety and fuel economy, which positions us well to benefit from the trend toward safer, more fuel-efficient vehicles.

We believe the demand for our products in the automotive OEM end market will continue to be driven by:

 

  •  

the level of global vehicle production;

 

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our ability to secure positions on new vehicle platforms relative to our competitors; and

 

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evolving regulatory requirements related to fuel economy and safety.

Automotive Aftermarket. We generated 21% of our Fiscal 2010 sales from the automotive aftermarket primarily through our Gates products. Though the automotive aftermarket is influenced by fuel prices and consumer

 

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confidence, it is typically resilient during economic downturns. This resilience is a result of the stable underlying demand for replacement products, which is more influenced by non-discretionary maintenance and repair needs than it is by economic factors. For example, according to IHS/CSM, U.S. light vehicle production fell 34% in 2009 compared with the prior year, whereas, according to AAIA, aggregate U.S. automotive aftermarket sales declined only 2% during 2009 compared with the prior year. The U.S. light vehicle aftermarket represented $207 billion in aggregate sales in 2009 and is expected to reach over $230 billion by 2012, a compound annual growth rate (“CAGR”) of 4%, according to AAIA estimates. Global vehicle production is also an aftermarket revenue growth driver as it adds to the aggregate global vehicle population. JD Power estimates that the world’s total vehicle population in 2009 was 1.0 billion and expects it to grow at a CAGR of 3% from 2009 through 2015. In particular, JD Power expects that total vehicle population in emerging markets will continue to grow significantly during that period, with CAGRs of 14% in China and 10% in India, which should aid the development of the still nascent automotive aftermarket in those countries.

We believe that the demand for our products in the automotive aftermarket will continue to be driven by:

 

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the size of the global vehicle population, which increases by the level of annual new vehicle production less the annual scrap rate;

 

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the average age of the global vehicle population as older vehicles typically require greater maintenance and repair; and

 

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annual miles driven, which correlates to the rate of vehicle wear and consequently demand for aftermarket products.

Building Products

The Building Products business group manufactures a wide range of air distribution products and systems, and bathware products (bathtubs, shower cubicles and luxury whirlpools) for the residential construction and non-residential construction end markets. Building Products sells its products through a range of distribution channels, principally to suppliers to the construction industry, building contractors, OEM and retailers for both the new build and refurbishment sectors. Over 90% of Fiscal 2010 sales are to the North American markets, but there is an increasing customer base in India, Thailand, China, Europe and the Middle East. The primary raw materials used by the business group are steel, aluminum, resin and fiberglass.

Air Distribution

LOGO

Air Distribution. We are the leading North American manufacturer of products that are used to distribute, recycle and vent air, and which are critical components of HVAC systems within non-residential and residential buildings. We design and manufacture a broad range of products, including, among others, GRDs, terminal units, fire and smoke dampers, louvers and fans for customers throughout North America. Our products are marketed under many established and well-known brand names including, Titus, Krueger, Ruskin and Hart & Cooley. We

 

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believe that we are the only nationwide U.S. provider of air distribution products across many of the primary categories in which we compete and we have an extensive multi-channel distribution network across the country. The majority of our products are sold through manufacturers’ representatives and building products wholesalers. The balance of our products are sold directly to HVAC OEMs, such as Carrier Group, York International and Lennox, as well as to home centers, specialty retailers and national accounts. We maintain a competitive advantage in this business by offering the broadest range of products, providing industry-leading customer service and delivering customized products on short lead times. Our portfolio of brands is recognized as representing the highest quality products, and building architects and engineers often specify them by name in building designs. The non-residential construction end market represented 74% of Air Distribution’s Fiscal 2010 sales, while 26% of Fiscal 2010 sales were to the residential construction end market. Within Air Distribution, 75% of Fiscal 2010 sales were into the new construction end market segment, while 25% of Fiscal 2010 sales were into the R&R end market segment, which includes all sales to home centers such as Home Depot and Lowes.

Bathware

LOGO

Bathware. We are a leading manufacturer of bathtubs and shower enclosures in the United States, accounting for approximately 30% of all fiberglass bathtubs sold in 2009. Our products are sold under the Aquatic brand name primarily through building products wholesalers, home center retailers and specialty distributors. Aquatic operates manufacturing plants and distribution warehouses across the United States, providing national distribution capabilities. The residential end market accounted for 96% of Bathware’s Fiscal 2010 sales, while the remaining 4% comprised sales to the manufactured housing industry.

Building Products End Markets

The majority of our Building Products business group serves the non-residential construction markets (65% of Fiscal 2010 Building Products sales), while the remainder (35%) sells primarily to the residential construction end market. Nearly all of our Building Products sales are to the North American construction markets.

Non-Residential Construction End Market

We generated 13% of our Fiscal 2010 sales from the non-residential construction end market, primarily from our Air Distribution segment. U.S. non-residential construction activity has been in decline since 2008, and, according to Dodge, in 2010, U.S. non-residential construction starts totaled 635 million square feet as compared with an average of 1.2 billion square feet over the 2006 to 2010 time period. McGraw-Hill is forecasting that the market will continue to stabilize in 2011 followed by more rapid growth in 2012 and 2013. Within our Air Distribution business group, approximately 25% of our Fiscal 2010 sales were derived from R&R activities. We believe this will be a growth area given the increasing global drive to reduce energy consumption in buildings, which many of our products achieve. Globally, buildings use approximately one-third of the world’s energy, 25% of which is attributable to buildings’ air distribution systems. Our energy efficient air distribution products can help reduce energy consumption in this area.

 

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We believe that demand in the non-residential construction end market, which is inherently local in nature, will be driven by underlying dynamics including:

 

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local office vacancy rates, which are tied to employment levels;

 

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the availability of financing for new construction projects;

 

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public and private spending on healthcare, education and other social services; and

 

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trends in the development of new urban areas and the re-development of existing urban areas.

Residential Construction End Market

We generated 7% of our Fiscal 2010 sales from the residential construction end market, including the R&R end market segment. The U.S. residential construction end market has been weak throughout 2010 and early 2011, with seasonally adjusted annualized housing starts standing at 549,000 at the end of March 2011, compared with the total housing starts in 2010 of 587,000 units and the historical average housing start rate between 1980 and 2010 of 1.4 million units (as measured by the U.S. Census Bureau Housing Starts). According to the NAHB, housing starts are expected to recover to approximately 900,000 units by 2012 as long-term demographic factors and an expected economic recovery lead to absorption of the current excess housing supply. However, despite signs of recent stabilization and the long-term positive outlook for new residential construction, recent housing starts data suggests that near-term demand will continue to be restrained. According to the U.S. Census Bureau, R&R spending has declined 23% since 2006, and we expect it to resume growth as consumer confidence and unemployment improve.

We believe that demand in the new residential construction end market segment will continue to be driven by:

 

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consumer confidence and employment levels;

 

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availability of financing along with interest rate stability;

 

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on-going population growth and relocation trends; and

 

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the level of existing home sales which impacts housing inventory levels as well as the level of R&R activity.

Customers

We have cultivated deep-seated customer relationships due to our strong brand reputation, consistent ability to meet product availability requirements, superior customer service and best-in-class quality. Some of our relationships with our largest customers span over 50 years. Our relationships with our top 20 customers have existed for more than 35 years on average. We believe we have cultivated relationships with an estimated 75% of the U.S. and European wholesale distributors to the automotive aftermarket, and are a key supplier to three of the largest North American distributors and retailers, NAPA, O’Reilly Auto Parts (both more than 50 years) and CARQUEST (approximately 45 years). In Europe, we have long-standing customer relationships with the leading automotive aftermarket distributors in each of Germany, France and the U.K. We maintain relationships with the largest global industrial replacement distributors, including Motion Industries (approximately 45 years) and Kaman (approximately 40 years). We have also cultivated exclusive relationships with over 100 leading distributors in the North American non-residential and residential construction end markets and maintain thousands of relationships for broad market coverage. Our extensive distribution network, comprehensive product portfolio and made-to-order components make it difficult for smaller domestic and emerging market competitors to penetrate our markets. For example, our Air Distribution products are often specified into building designs by engineers and architects. Our top five customers by business segment and their contribution to group sales are listed below.

 

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Industrial

    % of Fiscal
2010 sales		     

Automotive

    % of Fiscal
2010 sales		  

Genuine Parts/Motion Industries

      2.2      

General Motors(1)

      6.2   

John Deere

      1.2      

Ford(1)

      3.5   

Redneck Trailer Supplies

      1.0      

Genuine Parts/NAPA

      3.4   

Jayco

      0.7      

Renault-Nissan(1)

      2.4   

JCB

      0.5      

Chrysler

      1.6  

 

(1) Includes sales of automotive OEM and automotive aftermarket products.

 

Air Distribution

    % of Fiscal
2010 sales		     

Bathware

    % of Fiscal
2010 sales		  

York International

      0.5      

Home Depot

      0.5   

Lennox

      0.4      

Ferguson Enterprises

      0.4   

Tom Barrow

      0.4      

Hajoca

      0.1   

Home Depot

      0.4      

WinWholesale

      0.1   

Norman S Wright

      0.4      

Morrison Supply

      0.1   

We have thousands of customers around the world and have developed long-standing business relationships with many of them. We have a significant concentration of customers in the United States, however we sell to nearly every developed country globally. We serve a diverse range of end markets, and serve customers across a broad range of end market segment. No single customer accounts for more than 7% of our sales and there are typically no significant amounts due from any one customer.

 

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Products

The following are some of our key products in each of our segments.

LOGO

Competition

Although our end markets are competitive, we believe that most of our products are technologically superior or of better quality than those of our competitors. Additionally, in certain cases we choose to match the prices of lower cost suppliers. We focus on differentiating our products through high quality, efficiency and performance as well as providing superior customer service and field sales support. We also maintain a broad collection of premier global brands which are among the most globally recognized in their respective industries, and we estimate that approximately 80% of our sales are derived from businesses that hold the number one position in their respective markets.

Industrial & Automotive: Gates is the world’s largest manufacturer of power transmission belts and hydraulic and industrial hoses. Gates’ key Power Transmission competitors include Goodyear Engineered Products, Dayco, Continental, Carlisle and Optibelt. The economic downturn caused significant financial distress for certain competitors, including Dayco (a division of Mark IV Industries), which filed for bankruptcy in April of 2009. These events strengthened Gates’ competitive position during the downturn. Gates’ key Fluid Power competitors include Parker Hannifin and Eaton Hydraulics. The TPMS market is largely dominated by three key players, Schrader, Continental and Pacific. Schrader is the market leader in TPMS with approximately 50% market share. Furthermore, Dexter and Ideal are leaders in their markets. Dexter’s key competitors are Axis and Alko, while Ideal does not face substantial competition from one specific player.

 

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Building Products: We are the leading North American manufacturer of products that are used to distribute, recycle and vent air, and which are critical components of HVAC systems within non-residential and residential buildings. Hart & Cooley is the market leader in Residential GRDs and competes with U.S. Aire and Tru Aire. This market is relatively fragmented as our competitors are regionally based. The key brands in our Air Distribution group are the market leaders in several non-residential HVAC applications where the key competitors include Greenheck, Price Industries, Metal Aire and Schebler. Additionally, we are a leading manufacturer of bathtubs and shower enclosures in the United States, accounting for approximately 30% of all fiberglass bathtubs sold in 2009. We face competition from Kohler, Jacuzzi Brands, American Standard and MAAX.

Sales, Marketing and Distribution

Our broad sales and distribution operations allow us to be strategically positioned to serve our customers efficiently across the globe and to provide local knowledge of product and application requirements. This network allows us to meet our customers’ product availability requirements with short lead times. Our global sales and service support presence helps reinforce customer and distributor relationships. These sales and distribution capabilities are not easy to replicate and provide us with an enduring competitive advantage and barrier to entry. Our global presence makes it difficult for smaller regional and low-cost country manufacturers to penetrate our markets.

Manufacturing and Properties

Our manufacturing facilities, distribution centers and offices are located in a number of countries, with a large proportion in North America. We own the majority of these facilities and continue to improve and replace them to meet the needs of our individual operations. As at December 31, 2010, I&A operated from 145 facilities in 25 countries, and Building Products operated from 62 facilities, predominantly in North America.

Employees

As of December 31, 2010, we had 27,672 employees excluding non-executive directors in our operating segments. Our I&A business employed 20,388, our Building Products business employed 7,157 and 127 were employed in our corporate functions. Approximately 12,000 of our employees are located in the United States and the rest are located in 30 other countries worldwide. A more detailed breakdown of non-executive director employees by business unit is as follows:

 

     Number of
Employees		  

Industrial & Automotive

   

– Power Transmission

      10,210   

– Fluid Power

      5,192   

– Sensors & Valves

      2,146   

– Other I&A

      2,840   
        

Total Industrial & Automotive

      20,388   

Building Products

   

– Air Distribution

      6,425   

– Bathware

      732   
        

Total Building Products

      7,157   

Corporate centers

      127   
        

Total

      27,672   
        

Certain of our employees are subject to collective bargaining agreements. In the United States and Canada, 20 of our facilities are subject to collective bargaining agreements, the majority of which are with the Sheet Metal Workers Union. Historically, the cost associated with the use of union labor versus non-union labor has not been

 

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materially different. To date, employee relations have been flexible and constructive as we have pursued lean manufacturing in our plants. In the United States, there have not been any strikes or material work stoppages or business interruptions in over 15 years, the most recent being in 1993 at one of Ruskin’s plants in Lexington, KY. There have been several minor work stoppages with respect to our European employees, but short work stoppages are common in many European jurisdictions and the longest recent stoppage lasted for four days in Nevers, France in 2006.

Raw Materials

We maintain a diversified supply base for the raw material inputs that we use in our manufacturing operations. In Fiscal 2010, we spent $1.9 billion or approximately 54% of our cost of goods sold on raw materials, with the top 10 representing an approximate $1.3 billion or 69% of total input purchases. The primary raw materials used by our I&A business group are rubber, steel, fibers and fabrics. In our Building Products business group, we primarily employ steel and aluminum in our products. Our top five raw materials represented 58% of total raw material purchases in Fiscal 2010, and are steel (20%), rubber (14%), fibers and fabric (11%), aluminum (8%) and iron (5%). We have historically been able to pass on cost increases to our customers when we have experienced rising prices for our material inputs. We maintain contracts with key component suppliers and often in these agreements we are able to include raw material clauses, which allow us to minimize the lag between an increase in costs and a raise in the prices for our products. These materials are generally sourced locally and are typically available from multiple qualified sources in quantities sufficient for our needs.

Patents and Trademarks

We market and sell our products and services under numerous trademarks, which we believe carry strong identities in the markets we serve. We also hold various patent and licenses with respect to our products. However, as we have many product lines, the loss or expiration of any particular patent or license would not materially affect our sales and profits.

Research and Development

Applied research development is important to our businesses and integral to our leading market positions. We have three groups in the United States, Europe and Japan that focus on the introduction of new and improved products with a particular emphasis on energy efficiency and safety, the application of technology to reduce unit and operating costs and improving services to our customers. Our research and development expenditures were $85.9 million (of which $2.8 million was capitalized) for Fiscal 2010, $78.6 million (of which $0.6 million was capitalized) for Fiscal 2009 and $92.7 million (of which $0.6 million was capitalized) for Fiscal 2008.

Regulations

We are subject to a variety of laws and regulations, including but not limited to those of the United States, that impose requirements that govern many aspects of our operations. These requirements include but are not limited to environmental, health and safety laws and legal requirements that are intended to curtail bribery and corruption.

We are subject to a variety of federal, state, local, foreign and provincial environmental, health and safety laws and regulations, including those governing the discharge of pollutants into the air or water, the management, storage and disposal of, or exposure to, hazardous substances and wastes, the responsibility to investigate and clean up contamination, and occupational health and safety. Fines and penalties may be imposed for non-compliance with applicable environmental, health and safety requirements and the failure to have or to comply with the terms and conditions of required permits. Historically, the costs to comply with environmental, health and safety requirements have not been material. However, the failure by us to comply with applicable environmental, health and safety requirements could result in fines, penalties, enforcement actions, third-party claims for property damage and personal injury, requirements to clean up property or to pay for the costs of cleanup, or regulatory or judicial orders requiring corrective measures, including the installation of pollution control equipment or remedial actions.

 

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Under certain laws and regulations, such as the federal U.S. Superfund law, the obligation to investigate and remediate contamination at a facility may be imposed on current and former owners or operators or on persons who may have sent waste to that facility for disposal. Liability under these laws and regulations may be without regard to fault or to the legality of the activities giving rise to the contamination. We are currently performing environmental investigations and remediation at a number of former and current facilities in the United States and Canada, as well as another facility in Belgium. We have incurred and will continue to incur costs to investigate and remediate conditions at those sites. We are also incurring costs associated with contamination at approximately twenty offsite waste disposal sites. We have established reserves of $12.0 million with respect to such remediation and other environmental matters. In the future, we may incur similar liabilities in connection with environmental conditions currently unknown to us relating to our existing, prior, or future sites or operations or those of predecessor companies whose liabilities we may have assumed or acquired. As discussed in “Risk Factors—Environmental compliance costs and liabilities and responses to concerns regarding climate change could affect our financial condition, results of operations and cash flows adversely,” we are and may from time to time be subject to personal injury and/or property damage lawsuits in which private parties allege damages arising from exposure to hazardous materials used, or alleged to be used, by us in the past.

In addition, environmental, health and safety laws and regulations applicable to our business and the business of our customers, and the interpretation or enforcement of these laws and regulations, are constantly evolving and it is impossible to predict accurately the effect that changes in these laws and regulations, or their interpretation or enforcement, may have upon our business, financial condition or results of operations. For example, legislation and regulations limiting emissions of greenhouse gases are at various stages of consideration and implementation, and if fully implemented, could negatively impact the market for the products we distribute and, consequently, our business. Should environmental laws and regulations, or their interpretation or enforcement, become more stringent, our costs could increase, which may have a material adverse effect on our business, financial condition and results of operations.

The FCPA, makes it a criminal offense for a U.S. corporation or other U.S. domestic concern corruptly to make or authorize payments or gifts of anything of value directly or indirectly to foreign officials for the purpose of obtaining or retaining business or to obtain any other unfair or improper advantage. We are also subject to laws and regulations covering subject matter similar to that of the FCPA that have been enacted by countries outside of the United States. Failure to comply with these laws could subject us to, among other things, penalties and legal expenses, which could harm our reputation and have a material adverse effect on our business, financial condition and results of operations.

Legal Proceedings

We are from time to time party to legal proceedings which arise in the normal course of business. We are not currently involved in any material litigation, the outcome of which would, in management’s judgment based on information currently available, have a material adverse effect on our financial condition, results of operations or cash flows.

Exchange Controls

There are no limits under the laws of The Netherlands or in our articles of association on non-residents of The Netherlands holding or voting our ordinary shares. Currently, there are no exchange controls under the laws of The Netherlands on the conduct of our operations or affecting the remittance of dividends, except that (i) the transfer of funds to jurisdictions subject to general economic sanctions adopted in connection with policies of the United Nations, European Commission or similar measures imposed directly by the Government of the Netherlands may be restricted.

 

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PRINCIPAL SHAREHOLDERS

Tomkins Acquisitions is a direct, wholly owned subsidiary of Holdings. Holdings is a company incorporated under the laws of The Netherlands, the outstanding capital stock of which is, or will be, owned by Pinafore Coöperatief U.A., the Sponsors, management and 7607555 Canada Inc., a Canadian corporation investing in securities in order to assist CPPIB with its regulatory requirements pursuant to the Regulations under the Canada Pension Plan Investment Board Act with respect to the holding of securities. Management will also invest, and be issued stock, in Holdings.

At the closing of the Acquisition, the Sponsors, the third party investor, and certain of their affiliates capitalized Top Co-op with an aggregate equity contribution of approximately $2.1 billion. The Sponsors, the third party investor, certain of their affiliates and co-investors and certain members of management together hold, or will hold, 100% of Top Co-op’s membership interests on a fully diluted basis. Certain members of management will invest in Holdings, and have been granted options to acquire shares in Holdings under our option plan described under “Management—Retirement Plans and Incentive Plans and Awards.”

 

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MANAGEMENT

Our executive officers and the managing board of Pinafore Holdings B.V. are as follows:

 

Name

    Age   

Position

James Nicol

    57   

Chief Executive Officer and Director C

John Zimmerman

    48   

Chief Financial Officer

David Carroll

    54   

Executive Vice President, Business Development

Terry O’Halloran

    63   

Chief Operating Officer, Building Products

Alan Power

    48   

President, Industrial and Automotive

Kosty Gilis

    37   

Director A

Donald West

    73   

Director A

Anthony Morgan

    39   

Director B

Ryan Selwood

    38   

Director B

Edwin Denekamp

    41   

Director C

Pieter Hallebeek

    35   

Director C

Johan Haneveer

    37   

Director C

Roelof Langelaar

    40   

Director C

Ronald Rosenboom

    50   

Director C

James Nicol

Mr. James Nicol has held the position of Chief Executive Officer since joining us in February 2002 and currently serves as a Managing Director on the Board of Directors of Holdings. Previously, Mr. Nicol was the President and Chief Operating Officer of Magna International Inc, a global automotive parts company. He joined Magna International Inc. in 1987 as Vice-President, Special Projects, following a successful career as a commercial lawyer. Mr. Nicol also founded TRIAM Automotive Inc. in 1992, and he returned to Magna International Inc. as Vice Chairman when it acquired TRIAM Automotive Inc. in 1998. He has earned degrees from York University and the London School of Economics.

John Zimmerman

Mr. John Zimmerman currently serves as our Chief Financial Officer. He joined us as Vice President of Corporate Development in 1999 and was appointed as Chief Financial Officer in October 2007. Mr. Zimmerman is a Chartered Accountant (S.A.) and practiced for many years at Deloitte in South Africa. He joined Braxton Associates in Toronto in 1990 and later became a partner at Orenda Corporate Finance in 1994. Mr. Zimmerman currently serves on the Board of Trustees at Colorado Academy. Mr. Zimmerman earned his Bachelor of Commerce (Hons) degree from the University of Cape Town, South Africa.

Terry O’Halloran

Mr. Terry O’Halloran currently serves as our Chief Operating Officer, Building Products. He joined us in 1985 as Vice President of Operations and has held the positions of Group President—Air Systems Division, President of Ruskin Company and President of Air Systems Components. He earned his Masters in Business Administration degree from the University of Dallas and a Bachelor in Business Administration from Texas Wesleyan University.

David Carroll

Mr. David Carroll currently serves as our Executive Vice President, Business Development. He has served with us since 2003 and has held positions of Executive Vice-President (Tomkins) and Executive Vice-President, Business Development. Previously, Mr. Carroll was Executive Vice President, Marketing and Corporate Planning of Magna International Inc., a global automotive parts company. He joined Magna International Inc. in 1984 as a Sales Coordinator. He earned a Bachelors in Business Administration with Honors and Masters in Business Administration both from the University of Western Ontario.

 

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Alan Power

Mr. Alan Power currently serves as our President, Industrial and Automotive. He joined us in September 2008. Previously, Mr. Power was President and Chief Operating Officer of Van Rob Inc., an auto parts company, President, Chief Executive Officer and Chairman of National Rubber Technologies, a manufacturer of rubber products, and President and Chief Executive Officer of Decoma International, an auto parts supplier. He earned his Mechanical Engineering degree from Technical University of Nova Scotia.

Kosty Gilis

Mr. Kosty Gilis currently serves as a Managing Director on the Board of Directors of Holdings. He is a Managing Director at Onex. Since joining Onex in 2004, he has worked on the acquisition of Allison Transmission and has been actively involved in sourcing, evaluating and conducting due diligence on a number of acquisition opportunities. Prior to joining Onex, Mr. Gilis spent four years at Willis Stein & Partners, a Chicago-based private equity firm, where he completed acquisitions and advised portfolio companies in the consumer products, industrial manufacturing and business services industries. Previously, Mr. Gilis was a management consultant at Bain & Company, where he worked on strategic and operational issues for clients in a variety of industries. Mr. Gilis currently serves on the board of directors of Allison Transmission Holdings Inc. Mr. Gilis earned a Master in Business Administration from the Harvard Graduate School of Business Administration and a Bachelor of Science in Economics from the Wharton School at University of Pennsylvania.

Donald West

Mr. Donald West currently serves as a Managing Director on the Board of Directors of Holdings. Mr. West is the Director of Tax –U.S. Operations for OMI Management U.S. Limited Partnership, a subsidiary of Onex Corporation, where he has worked since 1983. Mr. West currently serves on the board of directors of Caliber Collison, Mister Carwash and Sport Supply Group. Mr. West holds a Bachelors of Science in Business Administration from the Ohio State University and is a Certified Public Accountant.

Anthony Morgan

Mr. Anthony Morgan currently serves as a Managing Director on the Board of Directors of Holdings. He is a Vice President at CPPIB based in Toronto. Since joining CPPIB in 2008, he has worked on the acquisition of Bank of America Merchant Services, Aricent Inc and Livingston International. Prior to joining CPPIB, Mr. Morgan worked for eight years in private equity in London, as a Partner at Alchemy Partners and an Investment Manager at Permira. Previously, Mr. Morgan was a management consultant at Mitchell Madison Group, where he worked on strategic and operational issues for clients in a variety of industries. Mr. Morgan currently serves on the boards of directors of Aricent Technologies and Livingston International. Mr. Morgan earned a Master of Business Administration from the Harvard Business School where he was a Fulbright Scholar, a Masters in Manufacturing Engineering from Cambridge University and a Bachelor of Engineering from Cambridge University.

Ryan Selwood

Mr. Ryan Selwood currently serves as a Managing Director on the Board of Directors of Holdings. He is a Senior Principal at CPPIB and is currently based in London, leading CPPIB’s Principal Investing activities in Europe. Since joining CPPIB in 2006, Ryan has had experience across a wide variety industries ranging from financial services to technology. Ryan led CPPIB’s investment into CHC Helicopter. Prior to joining CPPIB, Mr. Selwood was a Vice-President at Merrill Lynch & Co. in the Financial Institutions Group in the Investment Banking Division in New York and Toronto. Ryan holds his MBA and law degrees from York University and a BA from the University of Western Ontario.

Edwin Denekamp

Mr. Edwin Denekamp was appointed as a Managing Director on the Board on September 1, 2010. Mr. Denekamp is currently employed as senior manager with ATC Management B.V. (“ATC”), which he joined in 2002. He is also a non-executive director of a number of Dutch-based private companies. Previously he worked for another Dutch based corporate service provider. He has earned a Bachelors in Business Administration in 1995.

 

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Pieter Hallebeek

Mr. Pieter Hallebeek was appointed as a Managing Director on the Board on October 26, 2010. Mr. Hallebeek is currently employed as senior manager with ATC, which he joined in 2005. He is also a non-executive director of a number of Dutch-based private companies. Previously he worked for another Dutch-based corporate service provider and as a corporate lawyer in a leading international law firm. Mr. Hallebeek graduated from the VU University Amsterdam in 2000.

Johan Haneveer

Mr. Johan Haneveer was appointed as a Managing Director on the Board on September 1, 2010. Next to this position, he is also a non-executive director of a number of Dutch-based private companies. Mr. Haneveer is currently employed as senior manager with ATC, which he joined in 2003. Previously he worked as a controller for an international Dutch-based export company. Mr. Haneveer has earned degrees from HES Amsterdam (business administration) and Economic Business School Markus Verbeek.

Roelof Langelaar

Mr. Roel Langelaar was appointed as a Managing Director on the Board on September 1, 2010. Next to this position, he is member of the board of directors of ATC, and a non-executive director of a number of Dutch-based private companies. Mr. Langelaar Joined ATC in 2003. Previously he worked for Rabobank Nederland and ING Bank N.V. Mr. Langelaar has earned a Bachelors in Business Administration in 1999.

Ronald Rosenboom

Mr. Ronald Rosenboom was appointed as a Mangling Director on the Board on September 1, 2010. Mr. Rosenboom is currently employed as business unit director with ATC, which he joined in 2003. He is also a non-executive director of a number of Dutch-based private companies. Previously he worked nine years for another Dutch-based corporate service provider. His last position was assistant managing director. He has earned a Bachelors in Business Administration in 1984.

Managing Director and Executive Officer Compensation

The table below shows compensation paid or payable to our directors and executive officers in respect of their services to us, including Mr. Nicol, Mr. Zimmerman, Mr. O’Halloran, Mr. Power, Mr. Pappayliou, Mr. Carroll, Mr. Rosenboom, Mr. Haneveer, Mr. Denekamp, Mr. Langelaar and Mr. Hallebeek as of December 31, 2010. The individuals designated as Managing Director A and Managing Director B did not receive compensation from us during 2010. Mr. Pappayliou retired effective March 31, 2011.

 

($ in thousands)    Successor             Predecessor  
     Q4 2010             9M 2010      Fiscal 2009      Fiscal 2008  

Short-term employee benefits:

                 

– Salaries and fees

      1,121             3,230         4,928         6,064   

– Bonus cash

      2,609             4,314         3,397         1,504   

– Benefits-in-kind

      71             149         168         308   

– Social security contributions

      12             27         425         509   

– Termination benefits

      —                —           755         37   
                                        
     3,813             7,720         9,673         8,422   

Share-based incentives:

                 

– Retention awards

      3,080             —           —           —     

– ABIP

                 

Bonus shares

      —                557         829         324   

Deferred shares

      —                1,113         1,659         647   

– Gain on the vesting of PSP awards

      14,979             —           —           —     

– Gain on the exercise of share options

      1,306             173         —           —     
                                        
     19,365             1,843         2,488         971   

Pension contributions

      355             1,039         1,260         2,603   
                                        
     23,533             10,602         13,421         11,996   
                                        

 

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Retirement Plans and Incentive Plans and Awards

Retirement Plans. Except for Mr. O’Halloran and Mr. Pappayliou, none of the members of our senior management who are employees participate or participated in any plan or program that provides pension or other retirement benefits (other than defined contribution plans such as the 401(k) plan in which members of our senior management in the U.S. participate). Instead, each of the members of our senior management who are employees receives a monthly supplemental payment in addition to regular base salary that is intended to allow the executive to make contributions to a personal retirement program of his choice. Mr. O’Halloran and Mr. Pappayliou participate or participated in one of our defined benefit pension plans and are also entitled to supplemental pension benefits in accordance with the terms of their employment agreement.

Annual Bonus Incentive Plan. In addition to annual base salary, members of senior management who are employees participate in the Tomkins Annual Bonus Incentive Plan, pursuant to which participants may earn annual bonuses. Bonus payments are determined based upon the amount of bonusable profit for the calendar year. Bonuses are payable quarterly and each member of senior management is entitled to a specified percentage of the applicable bonusable profit.

Pre-Acquisition Equity Incentive Programs. Prior to the Acquisition, we maintained several equity incentive award programs consisting of certain share option schemes and a Performance Share Plan. In connection with the Acquisition all outstanding options under the share option schemes were converted (directly or indirectly) into the right to receive, upon cancellation or exercise of the options, an amount equal to the difference between the aggregate amount of cash consideration payable in respect of the underlying shares subject to the options and the aggregate exercise price of such options.

In addition, all outstanding awards in connection with our Performance Share Plan fully vested as a result of the Acquisition and were paid in cash at that time, except that as an alternative to this accelerated vesting and payment under the Performance Share Plan, certain members of our senior management who are employees and certain other employees who were not resident in the U.S. elected to cancel their Performance Share Plan awards (the ‘PSP awards’) in exchange for awards of options to purchase equity interests in Holdings (the ‘Replacement Options’). The shares covered by each Replacement Option had a market value at the time of the award equal to the market value of the shares subject to the cancelled PSP awards. An aggregate of 16,020 ‘B’ ordinary shares are subject to Replacement Options granted to certain of our directors and executive officers during Fiscal 2010. Each Replacement Option has a nominal exercise price and was fully vested at grant. The Replacement Options will expire on the tenth anniversary of the grant date.

Current Equity Incentive Plan. Holdings has established an equity incentive plan under which each of the members of our senior management who is an employee, and certain other employees, received awards of options to purchase “B” ordinary shares in Holdings (the “Variable Options”). The percentage of Holdings shares available for such options is up to 15% of the ordinary share capital of Holdings on a fully diluted basis. The Variable Options are divided into three tiers with distinct escalating exercise prices for each tier, allowing the option holders to participate in the aggregate in 9%, 12% and 15%, respectively, of the gains of Holdings’ equity investors above certain minimum return thresholds.

The first tier of Variable Options has an exercise price equal to $1,966.00 (the “Initial Exercise Price”) compounded at 8% per annum. The second tier of Variable Options has an exercise price equal to the Initial Exercise Price compounded at 25% per annum (but subject, in certain circumstances, to a cap of 2.25 times the Initial Exercise Price). The third tier of Variable Options has an exercise price equal to the Initial Exercise Price compounded at 27.5% per annum (but subject, in certain circumstances, to a cap of 2.5 times the Initial Exercise Price).

 

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The equity incentive plan is designed to provide management with an initial 9% of the equity (after coverage of the initial investment made by Holdings’ equity investors plus 8% compounded), subject to certain step-ups at higher levels of returns. Under this plan, an aggregate of 139,448 “B” ordinary shares are subject to Variable Options granted to certain of our directors and executive officers during Fiscal 2010. The Variable Options were vested as to 25% on grant, with a further 25% vesting on the first three anniversaries of the Acquisition becoming effective, subject to continued employment on the applicable vesting date. The vesting of the Variable Options will be accelerated in whole or in part in the event of a change of control or certain liquidity events while the holder is still employed, or, in part, if the holder is a good leaver. The Variable Options will expire on the tenth anniversary of the grant date.

Retention Awards. In addition to the Variable Options, the equity incentive plan provides for the grant of retention awards to certain of our employees, and such awards were awarded in December 2010 to certain members of senior management. The retention awards consist of the right to receive “B” ordinary shares in Holdings, which shares would be issued on the first to occur of December 10, 2015 or the holder’s termination of employment in certain circumstances. The retention awards will become vested as to one-third of the award on the first three anniversaries following the date of the awards, subject to continued employment on the applicable vesting date. The vesting of the retention awards will be accelerated in the event of a change of control or liquidity event while the holder is still employed, or if the holder dies, has his employment terminated due to disability or without cause or resigns for good reason.

Share Ownership

As at June 21, 2011, the interests of our directors and executive officers in our “B” ordinary shares were as follows:

 

      Number of
‘B’  ordinary shares		  

Directors

      —     

Executive officers

      2,907   
        
     2,907   
        

The above interests have not yet been issued by us and in aggregate comprise less than 1% of the Company’s issued “B” shares.

As at June 21, 2011, our directors and executive officers held the following options over our shares and in our subsidiary, Tomkins Limited:

 

                      Number of options held  

Scheme

   

Grant date

   

Expiry date

    Exercise
price		      Directors      Other
executive
officers		      Total  

Holdings

                  

Replacement Options

    September 28, 2010    September 28, 2020    € 0.01         11,898         4,122         16,020   

Variable Options

                  

– First tier

    November 11, 2010    November 11, 2020    $ 2,060         43,389         39,752         83,141   

– Second tier

    November 11, 2010    November 11, 2020    $ 2,252         14,463         13,251         27,714   

– Third tier

    November 11, 2010    November 11, 2020    $ 2,279         14,463         13,251         27,714   
                                   
              72,315         66,254         138,569   
                                   

Tomkins Limited

                  

Premium Priced Option

    February 11, 2002    June 24, 2011      345.00p         1,015,228         —           1,015,228   
                                   
              1,015,228         —           1,015,228   
                                   

 

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Options Over Our Shares

The Replacement Options and the Variable Options are over our unissued “B” ordinary shares. The Replacement Options vested on the grant date. As at April 8, 2011, 25% of each tier of the Variable Options had vested. Details of the options granted over our shares are presented in note 36 to the consolidated financial statements included elsewhere in this prospectus.

Options Over Shares in Tomkins Limited

Options remain outstanding over unissued ordinary shares in Tomkins Limited under employee share option schemes that were in operation prior to the acquisition of Tomkins. All of these options have vested. If the options are exercised, the requisite number of ordinary shares will be issued by Tomkins Limited and immediately acquired by us for consideration of 325p per share in cash.

Employment Agreements

In connection with the Acquisition, the members of senior management, other than Mr. Pappayliou, entered into new employment agreements with either Holdings or one of its subsidiaries, which we believe contain customary and market terms regarding employment and compensation matters. These agreements also provide for compensation upon termination of employment by us (without cause) or termination of employment by the executive for good reason.

Board Practices

Board of Directors

The constitution of Holdings requires that a majority of the directors present at any meeting must vote in favor to approve a resolution, such approval generally to include the affirmative vote of at least one Director A and one Director B. The directors may also adopt resolutions without convening a general meeting, provided that such resolutions are adopted unanimously and in writing. The Board requires the approval at the general meeting of shareholders with respect to such resolutions as shall have been specified in a resolution at the general meeting of shareholders of which the Board shall have been notified. The Board is authorized to represent Holdings and may also be represented by one Director A, one Director B and one Director C acting jointly. Pursuant to the terms of the Investment Agreement, Onex has appointed Mr. Gilis and Mr. West each as a Managing Director A and CPPIB has appointed Mr. Selwood and Mr. Morgan each as Managing Director B. The other Managing Directors are each Managing Director C. See “Certain Relationships And Related-Party Transactions—Investment Agreement.”

 

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CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS

Management Services Agreements

We have entered into certain agreements with the Sponsors, or their affiliates, pursuant to which we pay the Sponsors fees for advisory consulting, financial oversight and other services provided and to be provided to us and our subsidiaries. Pursuant to such agreements, subject to certain conditions, we expect to pay an annual management fee to the Sponsors of approximately $3.0 million, will reimburse their out-of-pocket expenses and we may pay the Sponsors additional fees associated with financial advisory and other future transactions.

In addition, the Sponsors each received a one-time transaction fee of $25.0 million for the provision of certain services in connection with the Acquisition, including arranging and negotiating the transaction and arranging and negotiating the funding for the transaction.

Investment Agreement

The Sponsors and any members of management that hold capital stock or options to purchase capital stock of Holdings are or will become parties to an investment agreement with Top Co-op and Holdings, which provides for, among other things, the right of the Sponsors to designate directors of Top Co-op and Holdings, restrictions on transfer of the equity of Top Co-op and Holdings held by such parties, tag-along-rights, drag-along rights, registration rights and certain voting rights.

Arrangements with Executive Officers

See “Management” for a description of arrangements with our directors and executive officers. We may enter into or modify employment agreements with certain of these individuals.

Other Related Party Transactions

Dexon Investments Limited (“Dexon”) is the minority shareholder in our 60% owned subsidiary, Winhere LLC. During Fiscal 2008, Gates Winhere Automotive Pump Products (Yantai) Co Ltd, a wholly-owned subsidiary of Winhere LLC, purchased land and buildings for $1.8 million from Yantai Winhere Auto Part Manufacturing Co Ltd, a fellow subsidiary of Dexon. As of January 3, 2009, there was a zero balance outstanding in respect of this transaction.

Schrader Duncan Limited is an associate in which we hold a 50% interest. During Fiscal 2009, we and Cosmopolitan Investments (a fellow shareholder) each issued a guarantee in favor of the State Bank of India (“State Bank”) in relation to any principal sum up to a maximum of 480 million Indian rupees ($10.2 million), together with interest and any other costs and charges due to State Bank in respect of credit facilities provided to Schrader Duncan. We and Cosmopolitan Investments are jointly and severally liable for the guaranteed amounts.

From time to time we sell to and purchase from associates and entities controlled by minority shareholders in our subsidiaries (see note 46 to the consolidated financial statements contained elsewhere in this prospectus). We may from time-to-time enter into contracts with portfolio companies owned by the Sponsors, which may be material in amount. Any such transactions will be on terms that are no less favorable to us than those that would have been obtained in a comparable transaction by us with an unrelated party.

 

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DESCRIPTION OF CERTAIN INDEBTEDNESS

Description of Senior Secured Credit Facilities

We have entered into our senior secured credit facilities with Citibank, N.A., as administrative agent and collateral agent, and affiliates of the initial purchasers as agents and/or lenders consisting of a senior secured revolving credit facility, a Term Loan A credit facility and a Term Loan B credit facility. Our revolving credit facility provides for multi-currency revolving loans and letters of credit up to an aggregate principal amount of $300.0 million, with a letter of credit sub-facility of $100.0 million. We initially borrowed $300.0 million under the Term Loan A credit facility and $1,700.0 million under the Term Loan B credit facility. On December 29, 2010, we prepaid $4.0 million against the Term Loan A credit facility and $22.7 million against the Term Loan B credit facility. As at December 31, 2010, the principal amount outstanding under the Term Loan A credit facility was $296.0 million and that under the Term Loan B credit facility was $1,677.3 million.

The revolving credit facility provides for multi-currency revolving loans and letters of credit up to an aggregate principal amount of $300.0 million, with a letter of credit sub-facility of $100.0 million. As at December 31, 2010, there were no drawings for cash under the revolving credit facility but there were letters of credit outstanding amounting to $40.3 million. We intend to fund working capital, capital expenditures, permitted acquisitions and investments with borrowings under our senior secured revolving credit facility, subject to availability. Our ability to draw under our senior secured revolving credit facility or issue letters of credit thereunder after the closing date is conditioned upon, among other things, our delivery of prior written notice of borrowing or issuance, as applicable, our ability to reaffirm the representations and warranties contained in our credit agreement and the absence of any default or event of default under our senior secured credit facilities.

Subject to certain conditions, the senior secured revolving credit facility may be increased by up to $100.0 million in additional commitments and the Term Loan B credit facility may be increased by, or new term loan facilities established up to, $400.0 million in additional commitments (less any increase in the revolving credit facility).

Borrowings under the senior secured credit facilities bear interest at a floating rate, which can be either LIBOR plus an applicable margin or, at our option, a base rate as defined in the credit agreement plus an applicable margin. The applicable margin for the Term Loan B credit facility is 4.5% per annum for LIBOR and 3.5% per annum for base rate. The applicable margin for the Term Loan A credit facility and the revolving credit facility is between 3.75% and 4.25% per annum for LIBOR and 2.75% and 3.25% per annum for base rate depending on a total leverage to EBITDA ratio. LIBOR is subject to a 1.75% floor and base rate is subject to a 2.75% floor. As at December 31, 2010, borrowings under the Term Loan A credit facility attracted an interest rate of 6.0% per annum and those under the Term Loan B credit facility attracted an interest rate of 6.25% per annum (in both cases, to be next re-set on March 31, 2011). Each letter of credit issued under the revolving credit facility attracts a participation fee equal to the applicable LIBOR margin under the revolving credit facility to the maximum amount available to be drawn and a fronting fee of the greater of 0.25% of the maximum amount available to be drawn and $1,500 per annum. An unused line fee of 0.75% per annum is based on the unused portion of the revolving credit facility (which may decrease to 0.5% per annum based on a total leverage to EBITDA ratio).

The following fees are applicable under the senior secured revolving credit facility: (i) an unused line fee of 0.75% per annum, based on the unused portion of the senior secured revolving credit facility, subject to decrease to 0.50% based on a total leverage to EBITDA ratio; (ii) a letter of credit participation fee on the aggregate stated amount of each letter of credit available to be drawn equal to the applicable margin for LIBOR loans; (iii) a letter of credit fronting fee equal to 0.25% per annum on the face amount of each letter of credit available to be drawn; and (iv) certain other customary fees and expenses of the lenders and agents.

The Term Loan A credit facility and the revolving credit facility mature on September 29, 2015 and the Term Loan B credit facility matures on September 29, 2016. The Term Loan A credit facility is subject to quarterly amortization payments of 2.5% and the Term Loan B credit facility is subject to quarterly amortization payments of 0.25%, in each case based on the original principal amount less certain prepayments and commencing on March 31, 2011 with the balance payable on maturity.

 

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We may voluntarily prepay loans or reduce commitments under the senior secured credit facilities, in whole or in part, subject to minimum amounts without premium or penalty, other than in the case of certain re-pricing transactions with respect to the Term Loan B credit facility prior to September 29, 2011, which shall be subject to a 1% premium. If we prepay LIBOR rate loans other than at the end of an applicable interest period, it is required to reimburse the lenders for any consequential losses or expenses. We must prepay the Term Loan A credit facility and Term Loan B credit facility with net cash proceeds of asset sales, casualty and condemnation events, incurrence of indebtedness (other than indebtedness permitted to be incurred) and a percentage of excess cash flow based on a total leverage to EBITDA ratio, in each case subject to certain exceptions such as reinvestment rights.

We are required to make prepayments under our revolving credit facility at any time when, and to the extent that, the aggregate amount of the outstanding loans and letters of credit under the revolving credit facility exceeds the aggregate amount of commitments in respect of the revolving credit facility.

Our obligations under the senior secured credit facilities are guaranteed by Holdings and Pinafore Acquisitions and, subject to customary grace periods following the Acquisition, will be guaranteed by all of our direct and indirect wholly owned subsidiaries (subject to certain exceptions to be agreed, including exclusion of any non-U.S. subsidiaries of a U.S. entity) and secured by a first lien on substantially all of their assets, including capital stock of subsidiaries (subject to certain exceptions). The relative rights governing the liens on the senior secured credit facilities and those securing the Notes will be governed by an intercreditor agreement. See “Description of Senior Secured Second Lien Notes—Security for the Notes—Second Lien Intercreditor Agreement.”

Our senior secured credit facilities contain customary negative covenants, including, but not limited to, restrictions on Holdings and its subsidiaries’ ability to merge and consolidate with other companies, incur indebtedness, grant liens or security interests on assets, make acquisitions, loans, advances or investments, pay dividends, sell or otherwise transfer assets, optionally prepay or modify the terms of any junior indebtedness, enter into transactions with affiliates or change our line of business. Our senior secured credit facilities require the maintenance of a minimum interest coverage ratio and a maximum total leverage ratio on a quarterly basis, and impose an annual cap on capital expenditures (subject to certain exceptions and ability to rollover unused amounts).

Our senior secured credit facilities contain customary affirmative covenants, including, but not limited to, delivery of financial and other information to the administrative agent, notice to the administrative agent upon the occurrence of certain material events, maintenance of existence, payment of material taxes and other claims, maintenance of properties and insurance, access to books and records by and meetings with the lenders, compliance with applicable laws and regulations, including environmental laws, and further assurances and provision of additional collateral and guarantees.

Our senior secured credit facilities provide that, upon the occurrence of certain events of default, our obligations thereunder may be accelerated and the lending commitments terminated. Such events of default include payment defaults to the lenders, material inaccuracies of representations and warranties, covenant defaults, cross-defaults to other material indebtedness, including the Notes being offered hereby, voluntary and involuntary bankruptcy proceedings, material money judgments, material pension-plan events, certain change of control events and other customary events of default.

On February 11, 2011, we agreed with the providers of the senior secured credit facilities a re-pricing of Term Loan A and Term Loan B and amendments to certain of the covenants attaching to the facilities. It was agreed that for both Term Loan A and Term Loan B the applicable margin for LIBOR will be reduced to 3.0% per annum, with LIBOR being subject to a 1.25% floor, and the applicable margin for base rate will be reduced to 2.0% per annum, with base rate being subject to a 2.25% floor. The re-pricing became effective on February 17, 2011 and attracted a one-off premium payment by us of $16.8 million.

Multi-Currency Revolving Credit Facility

As at January 2, 2010, Tomkins had in place a £400 million multi-currency revolving credit facility and had in place a $450 million forward-start facility that commenced on the expiry of the existing facility in August 2010 and was itself due to expire in May 2012. Borrowings under the facility attracted interest at floating rates determined by reference to LIBOR. As at January 2, 2010 and during 9M 2010, there were no drawings against the facility, which was replaced by the senior secured credit facilities on the Acquisition.

 

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Description of Medium Term Notes

On December 20, 2001, Tomkins issued the 2011 Notes, which were subsequently guaranteed by Tomkins Finance plc on August 19, 2003. Interest is payable on the 2011 Notes annually in arrears on December 20 of each year up to and including the maturity date of December 20, 2011. On September 16, 2003, Tomkins Finance plc issued the 2015 Notes, which are guaranteed by Tomkins. Interest is payable on the 2015 Notes annually in arrears on September 16 of each year up to and including the maturity date of September 16, 2015. Both the 2011 Notes and the 2015 Notes were issued under a £750,000,000 medium term note programme (the “Programme”) originally entered into on October 26, 2001. Subsequently, on August 28, 2003, Tomkins Finance plc replaced Tomkins as the issuer under the Programme for notes issued after that date under the Programme, with Tomkins agreeing to act as guarantor of such notes.

At the time of the Acquisition, Tomkins had outstanding the £150 million 2011 Notes and the £250 million 2015 Notes. Each of the 2011 Notes and the 2015 Notes contain a put option giving the holders the option to put their notes to the relevant issuer at par plus accrued interest in the event of a change of control or certain acquisitions and disposals and, in either case, a ratings downgrade occurring as a result of such transaction. On September 13, 2010, we offered to purchase the outstanding 2011 Notes at a price of 105.787% (plus accrued and unpaid interest) and the outstanding 2015 Notes at a price of 100.50% (plus accrued and unpaid interest). Acceptances were received in respect of £40.9 million of the 2011 Notes and £109.3 million of the 2015 Notes. On October 6, 2010, the purchase was completed for total consideration of £153.1 million (plus accrued interest of £3.0 million).

On November 19, 2010, we notified holders of the 2011 Notes and the 2015 Notes that the credit rating of the notes had been withdrawn by Moody’s and downgraded by Standard & Poor’s as a consequence of the Acquisition and that this constituted a put event entitling the holders to redeem the notes at par (plus accrued and unpaid interest). Put notices were received in respect of £2.1 million of the 2011 Notes and £123.5 million of the 2015 Notes. Settlement took place on December 17, 2010 for total consideration of £125.6 million (plus accrued interest of £2.0 million).

As at December 31, 2010, the principal amount of the outstanding 2011 Notes was £107.0 million and that of the 2015 Notes was £17.2 million.

On December 30, 2010, we made a further offer to purchase the outstanding 2011 Notes at a price of 105.00% (plus accrued and unpaid interest). Acceptances were received in respect of £4.9 million of the 2011 Notes. Settlement took place on January 19, 2011 and the principal amount of the outstanding 2011 Notes was thereby reduced to £102.1 million.

 

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THE EXCHANGE OFFER

Tomkins, LLC and Tomkins, Inc., the co-issuers of the initial notes, hereby offer to exchange a like principal amount of exchange notes representing the same underlying indebtedness as the initial notes for any or all initial notes on the terms and subject to the conditions set forth in this prospectus and accompanying letter of transmittal. We refer to the offer as the “exchange offer.” You may tender some or all of your initial notes pursuant to the exchange offer.

As of the date of this prospectus, $1,150,000,000 aggregate principal amount of the initial notes is outstanding (CUSIP Nos. 693492 AC4 and 072209 AB2).

This prospectus, together with the letter of transmittal, is first being sent to all holders of initial notes known to us on or about             , 2011. Our obligation to accept initial notes for exchange notes pursuant to the exchange offer is subject to certain conditions set forth under “Conditions to the Exchange Offer” below. We currently expect that each of the conditions will be satisfied and that no waivers will be necessary.

Except as described below, upon the completion of this exchange offer, our obligations with respect to the registration of the initial notes and the exchange notes will terminate. A copy of the registration rights agreement has been filed as an exhibit to the registration statement and this summary of the material provisions of the registration rights agreement does not purport to be complete and is qualified in its entirety by reference to the registration rights agreement. Assuming the timely filing and effectiveness of the registration statement and consummation of this exchange offer, we will not have to pay additional interest on the initial notes. Following the completion of this exchange offer, holders of initial notes not tendered will not have any further registration rights other than as set forth in the paragraphs below, and the initial notes will continue to be subject to certain restrictions on transfer. Additionally, the liquidity of the market for the initial notes could be adversely affected upon consummation of this exchange offer. See “Risk Factors—Risks Relating to the Exchange Offer—If you choose not to exchange your initial notes in the exchange offer, the transfer restrictions currently applicable to your initial notes will remain in force and the market price of your initial notes may decline.”

Purpose and Effect of the Exchange Offer

In connection with the private placement of the initial notes, we entered into a registration rights agreement with Merrill, Lynch, Pierce, Fenner & Smith Incorporated (as successor-in-interest to Banc of America Securities LLC), Citigroup Global Market Inc., Barclays Capital Inc., RBC Capital Market Corporation and UBS Securities LLC, as representatives of the other initial purchasers of the initial notes, in which we and the guarantors agreed, among other things, to use our commercially reasonable efforts to file a registration statement within 270 days of the issuance of the initial notes and to consummate the exchange offer within 360 days of the issuance of the initial notes. The exchange notes will have terms substantially identical to the terms of the initial notes and represent the same underlying indebtedness as the initial notes, except that the exchange notes will not contain terms with respect to transfer restrictions or additional interest upon a failure to fulfill certain of our obligations under the registration rights agreements.

Under certain circumstances specified in the registration rights agreement, we may be required to use our commercially reasonable efforts to file and cause the SEC to declare effective a shelf registration statement with respect to the resale of the initial notes within the time periods specified in the registration rights agreements and to keep the shelf registration statement effective for one year or such shorter period ending when all initial notes or exchange notes covered by the registration statement have been sold in the manner set forth and as contemplated in the registration statement.

If we fail to comply with certain obligations under the registration rights agreements, we will be required to pay additional interest to holders of the initial notes and the exchange notes required to be registered on a shelf registration statement.

Each holder of initial notes that wishes to exchange their initial notes for exchange notes representing the same underlying indebtedness in the exchange offer will be required to make the following written representations:

 

  •  

any exchange notes to be received by such holder will be acquired in the ordinary course of its business;

 

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  •  

such holder has no arrangement or understanding with any person to participate in the distribution (within the meaning of the Securities Act) of the exchange notes in violation of the provisions of the Securities Act;

 

  •  

such holder is not an affiliate of the issuers or any of the guarantors, as defined by Rule 405 of the Securities Act, or if it is an affiliate, it will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable;

 

  •  

it is not engaged in, and does not intend to engage in, a distribution of exchange notes; and

 

  •  

such holder has the full power and authority to transfer the initial notes in exchange for the exchange notes and that the issuers will acquire good and unencumbered title thereto free and clear of any liens, restrictions, charges or encumbrances and not subject to any adverse claims.

Each broker-dealer that receives exchange notes for its own account in exchange for initial notes, where the broker-dealer acquired the initial notes as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. Please see “Plan of Distribution.”

Resale of Exchange Notes

Based on interpretations by the staff of the SEC as set forth in no-action letters issued to third parties referred to below, we believe that you may resell or otherwise transfer exchange notes issued in the exchange offer without complying with the registration and prospectus delivery provisions of the Securities Act, if:

 

  •  

you are acquiring the exchange notes in your ordinary course of business;

 

  •  

you do not have an arrangement or understanding with any person to participate in a distribution of the exchange notes;

 

  •  

you are not an affiliate of the issuers or any of the guarantors, as defined by Rule 405 of the Securities Act; and

 

  •  

you are not engaged in, and do not intend to engage in, a distribution of the exchange notes.

If you are an affiliate of the issuers or any of the guarantors, or are engaging in, or intend to engage in, or have any arrangement or understanding with any person to participate in, a distribution of the exchange notes, or are not acquiring the exchange notes in the ordinary course of your business, then:

 

  •  

you cannot rely on the position of the staff of the SEC enunciated in Morgan Stanley & Co., Inc. (available June 5, 1991), Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in the SEC’s letter to Shearman & Sterling dated July 2, 1993, or similar no-action letters; and

 

  •  

in the absence of an exception from the position stated immediately above, you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale of the exchange notes.

This prospectus may be used for an offer to resell, for the resale or for other retransfer of exchange notes only as specifically set forth in this prospectus. With regard to broker-dealers, only broker-dealers that acquired the initial notes as a result of market-making activities or other trading activities may participate in the exchange offer. Each broker-dealer that receives exchange notes for its own account in exchange for initial notes where such initial notes were acquired by such broker-dealer as a result of market-making activities or other trading activities must acknowledge that it will deliver a prospectus in connection with any resale of the exchange notes. Please read “Plan of Distribution” for more details regarding the transfer of exchange notes.

 

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Terms of the Exchange Offer

On the terms and subject to the conditions set forth in this prospectus and in the accompanying letter of transmittal, we will accept for exchange in the exchange offer initial notes that are validly tendered and not validly withdrawn prior to the expiration date. We will issue exchange notes in exchange for a corresponding principal amount of initial notes surrendered in the exchange offer. Initial notes tendered in the exchange offer must be in denominations of the principal amount of $2,000 and any integral multiple of $1,000 in excess thereof.

The form and terms of the exchange notes will be substantially identical to the form and terms of the initial notes, except that the exchange notes will not contain terms with respect to transfer restrictions or additional interest upon a failure to fulfill certain of our obligations under the registration rights agreements. The exchange notes will evidence the same debt as the initial notes. The exchange notes will be issued under and entitled to the benefits of the same indenture under which the initial notes were issued, and the exchange notes and the initial notes will constitute a single class and series of notes for all purposes under the indenture. For a description of the indenture, please see “Description of Senior Secured Second Lien Notes.”

The exchange offer is not conditioned upon any minimum aggregate principal amount of initial notes being tendered for exchange.

There will be no fixed record date for determining registered holders of initial notes entitled to participate in the exchange offer.

We intend to conduct the exchange offer in accordance with the provisions of the registration rights agreement, the applicable requirements of the Securities Act and the Exchange Act, and the rules and regulations of the SEC. Initial notes that are not tendered for exchange in the exchange offer will remain outstanding and continue to accrue interest and will be entitled to the rights and benefits that such holders have under the indenture relating to such holders’ initial notes, except for any rights under the registration rights agreement that by their terms terminate upon the consummation of the exchange offer.

We will be deemed to have accepted for exchange properly tendered initial notes when we have given oral or written notice of the acceptance to the exchange agent. The exchange agent will act as agent for the tendering holders for the purposes of receiving the exchange notes from us and delivering exchange notes to holders. Subject to the terms of the registration rights agreement, we expressly reserve the right to amend or terminate the exchange offer and to refuse to accept the occurrence of any of the conditions specified below under “Conditions to the Exchange Offer.”

Holders who tender initial notes in the exchange offer will not be required to pay brokerage commissions or fees or, subject to the instructions in the letter of transmittal, transfer taxes with respect to the exchange of initial notes. We will pay all charges and expenses, other than certain applicable taxes described below, in connection with the exchange offer. It is important that you read “— Fees and Expenses” below for more details regarding fees and expenses incurred in the exchange offer.

Expiration Date; Extensions, Amendments

As used in this prospectus, the term “expiration date” means 5:00 p.m., New York City time, on                 , 2011. However, if we, in our sole discretion, extend the period of time for which the exchange offer is open, the term “expiration date” will mean the latest time and date to which we shall have extended the expiration of the exchange offer.

To extend the period of time during which the exchange offer is open, we will notify the exchange agent of any extension by oral or written notice, followed by notification to the registered holders of the initial notes no later than 9:00 a.m., New York City time, on the business day after the previously scheduled expiration date.

 

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We reserve the right, in our sole discretion:

 

  •  

to delay accepting for exchange any initial notes (only if we amend or extend the applicable exchange offer);

 

  •  

to extend the exchange offer or to terminate the exchange offer and to refuse to accept initial notes not previously accepted if any of the conditions set forth below under “Conditions to the Exchange Offer” have not been satisfied, by giving oral or written notice of such delay, extension or termination to the exchange agent; and

 

  •  

subject to the terms of the registration rights agreement, to amend the terms of the exchange offer in any manner.

Any delay in acceptance, extension, termination or amendment will be followed promptly by oral or written notice to the registered holders of the initial notes, and, to the extent the exchange offer is terminated, any initial notes accepted will be promptly returned after the termination of the exchange offer. If we amend the exchange offer in a manner that we determine to constitute a material change, including the waiver of a material condition or if we terminate the offer, we will notify the exchange agent by oral or written notice, followed by notification to the registered holders of the initial notes no later than 9:00 a.m., New York City time, on the business day after the amendment or termination has been determined and will extend the offer period if necessary so that at least five business days remain in the offer following notice of the material change.

Conditions to the Exchange Offer

Despite any other term of the exchange offer, we will not be required to accept for exchange, or to issue exchange notes in exchange for, any initial notes, and we may terminate or amend the exchange offer as provided in this prospectus before accepting any initial notes for exchange, if:

 

  •  

the exchange offer, or the making of any exchange by a holder of initial notes, violates any applicable law or interpretation of the staff of the SEC;

 

  •  

any action or proceeding shall have been instituted or threatened in any court or by any governmental agency that might materially impair our ability to proceed with the exchange offer, and any material adverse development shall have occurred in any existing action or proceeding with respect to us; or

 

  •  

all governmental approvals shall not have been obtained, which approvals we deem necessary for the consummation of the exchange offer.

 

  •  

If the exchange offer is terminated, initial notes will be returned to their registered holders.

 

  •  

In addition, we will not be obligated to accept for exchange the initial notes of any holder that has not made to us:

 

  •  

the representations described under “— Purpose and Effect of the Exchange Offer” and “— Procedures for Tendering Initial Notes”; and

 

  •  

any other representations as may be reasonably necessary under applicable SEC rules, regulations, or interpretations to make available to us an appropriate form for registration of the exchange notes under the Securities Act.

All conditions to the exchange offer must be satisfied or waived prior to the expiration of the exchange offer.

We expressly reserve the right at any time or at various times to extend the period of time during which the exchange offer is open. Consequently, we may delay acceptance of any initial notes due to our extension of the

 

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exchange offer by notice by press release or other public announcement as required by Rule 14e-1(d) of the Securities Act of such extension to their holders. During any such extensions, all initial notes previously tendered will remain subject to the exchange offer, and we may accept them for exchange. We will return any initial notes that we do not accept for exchange for any reason without expense to their tendering holder promptly after the expiration or termination of the exchange offer. We will issue exchange notes promptly after the expiration of the exchange offer.

We expressly reserve the right to amend or terminate the exchange offer and to reject for exchange any initial notes not previously accepted for exchange upon the occurrence of any of the conditions of the exchange offer specified above. We will give notice by press release or other public announcement of any extension, amendment, non-acceptance or termination to the holders of the initial notes no later than 9:00 a.m., New York City time, on the business day after the previously scheduled expiration date.

These conditions are for our sole benefit, and we may assert them regardless of the circumstances that may give rise to them so long as such circumstances do not arise due to our action or inaction or waive them in whole or in part at any or at various times in our sole discretion. If we fail at any time to exercise any of the foregoing rights, this failure will not constitute a waiver of such right. Each such right will be deemed an ongoing right that we may assert at any time or at various times.

Procedures for Tendering Initial Notes

Only a holder of initial notes may tender their initial notes in the exchange offer. To tender in the exchange offer, a holder must comply with either of the following:

 

  •  

complete, sign and date the letter of transmittal or a facsimile of the letter of transmittal, have the signature on the letter of transmittal guaranteed if required by the letter of transmittal and mail or deliver such letter of transmittal or facsimile to the exchange agent prior to the expiration date; or

 

  •  

comply with DTC’s Automated Tender Offer Program procedures described below.

In addition, on or prior to the expiration date, either:

 

  •  

the exchange agent must receive initial notes along with the letter of transmittal; or

 

  •  

prior to the expiration date, the exchange agent must receive a timely confirmation of book-entry transfer of initial notes into the exchange agent’s account at DTC according to the procedure for book-entry transfer described below or a properly transmitted agent’s message; or

 

  •  

the holder must comply with the guaranteed delivery procedures described

To be tendered effectively, the exchange agent must receive any physical delivery of the letter of transmittal and other required documents at the address set forth below under “— Exchange Agent” prior to the expiration date.

A tender to us that is not withdrawn prior to the expiration date constitutes an agreement between us and the tendering holder upon the terms and subject to the conditions described in this prospectus and in the letter of transmittal.

The method of delivery of initial notes, letter of transmittal and all other required documents to the exchange agent is at the holder’s election and risk. Rather than mail these items, we recommend that holders use an overnight or hand delivery service. In all cases, holders should allow sufficient time to assure timely delivery to the exchange agent before the expiration date. Holders should not send letters of transmittal or certificates representing initial notes to us. Holders may request that their respective brokers, dealers, commercial banks, trust companies or other nominees effect the above transactions for them. Do not send letters of transmittal or initial notes to the issuers or any guarantor.

 

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If you are a beneficial owner whose initial notes are held in the name of a broker, dealer, commercial bank, trust company, or other nominee who wishes to participate in the exchange offer, you should promptly contact such party and instruct such person to tender initial notes on your behalf.

You must make these arrangements or follow these procedures before completing and executing the letter of transmittal and delivering the initial notes.

Signatures on the letter of transmittal or a notice of withdrawal, as the case may be, must be guaranteed by a member firm of a registered national securities exchange or of the National Association of Securities Dealers, Inc., a commercial bank or trust company having an office or correspondent in the U.S. or another “Eligible Guarantor Institution” within the meaning of Rule 17A(d) -15 under the Exchange Act unless the initial notes surrendered for exchange are tendered:

 

  •  

by a registered holder of the initial notes who has not completed the box entitled “Special Issuance Instructions” or “Special Delivery Instructions” on the letter of transmittal; or

 

  •  

for the account of an Eligible Guarantor Institution.

If the letter of transmittal is signed by a person other than the registered holder of any initial notes listed on the initial notes, such initial notes must be endorsed or accompanied by a properly completed bond power. The bond power must be signed by the registered holder as the registered holder’s name appears on the initial notes and an Eligible Guarantor Institution must guarantee the signature on the bond power.

If the letter of transmittal or any certificates representing initial notes or bond powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations, or others acting in a fiduciary or representative capacity, those persons should also indicate when signing and, unless waived by us, they should also submit evidence satisfactory to us of their authority to so act.

The exchange agent and DTC have confirmed that any financial institution that is a participant in DTC’s system may use DTC’s Automated Tender Offer Program to tender. Participants in the program may, instead of physically completing and signing the letter of transmittal and delivering it to the exchange, electronically transmit their acceptance of the exchange by causing DTC to transfer the initial notes to the exchange agent in accordance with DTC’s Automated Tender Offer Program procedures for transfer. DTC will then send an agent’s message to the exchange agent. The term “agent’s message” means a message transmitted by DTC, received by the exchange agent and forming part of the book-entry confirmation, that states that:

 

  •  

DTC has received an express acknowledgment from a participant in its Automated Tender Offer Program that is tendering initial notes that are the subject of the book-entry confirmation;

 

  •  

the participant has received and agrees to be bound by the terms of the letter of transmittal or, in the case of an agent’s message relating to guaranteed delivery, such participant has received and agrees to be bound by the applicable notice of guaranteed delivery; and

 

  •  

we may enforce that agreement against such participant.

Book-Entry Delivery Procedures

Promptly after the date of this prospectus, the exchange agent will establish an account with respect to the initial notes at DTC as the book-entry transfer facility, for purposes of the exchange offer. Any financial institution that is a participant in the book-entry transfer facility’s system may make book-entry delivery of the initial notes by causing the book-entry transfer facility to transfer those initial notes into the exchange agent’s account at the facility in accordance with the facility’s procedures for such transfer. To be timely, book-entry delivery of initial notes requires receipt of a confirmation of a book-entry transfer, a “book-entry confirmation,” prior to the expiration date. In addition, although delivery of initial notes may be effected through book-entry transfer into the exchange agent’s account at the applicable book-entry transfer facility, the applicable letter of transmittal or a manually signed

 

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facsimile thereof, together with any required signature guarantees and any other required documents, or an “agent’s message,” as defined above, in connection with a book-entry transfer, must, in any case, be delivered or transmitted to and received by the exchange agent at its address set forth on the cover page of the applicable letter of transmittal prior to the expiration date to receive exchange notes for tendered initial notes, or the guaranteed delivery procedure described below must be complied with. Tender will not be deemed made until such documents are received by the exchange agent. Delivery of documents to the applicable book-entry transfer facility does not constitute delivery to the exchange agent.

Guaranteed Delivery Procedures

If you wish to tender your initial notes but your initial notes are not immediately available or you cannot deliver your initial notes, the letter of transmittal or any other required documents to the exchange agent or comply with the applicable procedures under DTC’s Automatic Tender Offer Program prior to the expiration date, you may still tender if:

 

  •  

the tender is made through an Eligible Guarantor Institution;

 

  •  

prior to the expiration date, the exchange agent receives from such Eligible Guarantor Institution either: (i) a properly completed and duly executed notice of guaranteed delivery, by facsimile transmission, mail, or hand delivery or (ii) a properly transmitted agent’s message and notice of guaranteed delivery, that (a) sets forth your name and address, the certificate number(s) of such initial notes and the principal amount of initial notes tendered; (b) states that the tender is being made by that notice of guaranteed delivery; and (c) guarantees that, within three New York Stock Exchange trading days after the expiration date, the letter of transmittal, or facsimile thereof, together with the initial notes or a book-entry confirmation, and any other documents required by the letter of transmittal, will be deposited by the Eligible Guarantor Institution with the exchange agent; and

 

  •  

the exchange agent receives the properly completed and executed letter of transmittal or facsimile thereof, as well as certificate(s) representing all tendered initial notes in proper form for transfer or a book-entry confirmation of transfer of the initial notes into the exchange agent’s account at DTC, and all other documents required by the letter of transmittal within three New York Stock Exchange trading days after the expiration date.

Upon request, the exchange agent will send to you a notice of guaranteed delivery if you wish to tender your initial notes according to the guaranteed delivery procedures.

Determination of Validity

The issuer and the guarantors, in their sole discretion, will resolve all questions regarding the form of documents, validity, eligibility, including time of receipt, and acceptance for exchange of any tendered old notes. The determination of these questions by the issuer and the guarantors, as well as their interpretation of the terms and conditions of the exchange offer, including the letter of transmittal, will be final and binding on all parties. A tender of old notes is invalid until all defects and irregularities have been cured or waived. Holders must cure any defects and irregularities in connection with tenders of old notes for exchange within such reasonable period of time as the issuer and the guarantors will determine, unless they waive the defects or irregularities. None of the issuer and the guarantors, any of their respective affiliates or assigns, the exchange agent or any other person is under any obligation to give notice of any defects or irregularities in tenders, nor will any of them be liable for failing to give any such notice.

The issuer and the guarantors reserve the absolute right, in their sole and absolute discretion:

 

  •  

to reject any tenders determined to be in improper form or unlawful;

 

  •  

to waive any of the conditions of the exchange offer; and

 

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  •  

to waive any condition or irregularity in the tender of old notes by any holder, whether or not we waive similar conditions or irregularities in the case of other holders.

If any letter of transmittal, certificate, endorsement, bond power, power of attorney, or any other document required by the letter of transmittal is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, that person must indicate such capacity when signing. In addition, unless waived by the issuer, the person must submit proper evidence satisfactory to the issuer, in its sole discretion, of the person’s authority to so act.

Withdrawal Rights

Except as otherwise provided in this prospectus, you may withdraw your tender of initial notes at any time prior to 5:00 p.m., New York City time, on the expiration date.

For a withdrawal to be effective:

 

  •  

the exchange agent must receive a written notice, which may be by telegram, telex, facsimile or letter, of withdrawal at its address set forth below under “— Exchange Agent”; or

 

  •  

you must comply with the appropriate procedures of DTC’s Automated Tender Offer Program system.

Any notice of withdrawal must:

 

  •  

specify the name of the person who tendered the initial notes to be withdrawn;

 

  •  

identify the initial notes to be withdrawn, including the certificate numbers and principal amount of the initial notes; and

 

  •  

where certificates for initial notes have been transmitted, specify the name in which such initial notes were registered, if different from that of the withdrawing holder.

If certificates for initial notes have been delivered or otherwise identified to the exchange agent, then, prior to the release of such certificates, you must also submit:

 

  •  

the serial numbers of the particular certificates to be withdrawn; and

 

  •  

a signed notice of withdrawal with signatures guaranteed by an eligible institution unless your are an Eligible Guarantor Institution.

If initial notes have been tendered pursuant to the procedures for book-entry transfer described above, any notice of withdrawal must specify the name and number of the account at the book-entry transfer facility to be credited with the withdrawn initial notes and otherwise comply with the procedures of the facility. We will determine all questions as to the validity, form, and eligibility, including time of receipt of notices of withdrawal and our determination will be final and binding on all parties. Any initial notes so withdrawn will be deemed not to have been validly tendered for exchange for purposes of the exchange offer. Any initial notes that have been tendered for exchange but that are not exchanged for any reason will be returned to their holder, without cost to the holder, or, in the case of book-entry transfer, the initial notes will be credited to an account at the book-entry transfer facility, promptly after withdrawal, rejection of tender or termination of the applicable exchange offer. Properly withdrawn initial notes may be retendered by following the procedures described under “— Procedures for Tendering Initial Notes” above at any time on or prior to the expiration date.

 

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Exchange Agent

Wilmington Trust FSB has been appointed as the exchange agent for the exchange offer. Wilmington Trust FSB also acts as trustee under the indenture governing the notes. You should direct all executed letters of transmittal and all questions and requests for assistance, requests for additional copies of this prospectus or of the letters of transmittal, and requests for notices of guaranteed delivery to the exchange agent addressed as follows:

Wilmington Trust FSB

c/o Wilmington Trust Company

Attn: Sam Hamed

Corporate Capital Markets

Rodney Square North

1100 North Market Street

Wilmington, Delaware 19890-1626

Tel: +1.302.636.6181.

Fax: +1.302.636.4139

If you deliver the letter of transmittal to an address other than the one set forth above or transmit instructions via facsimile other than the one set forth above, that delivery or those instructions will not be effective.

Fees and Expenses

The registration rights agreement provides that we will bear all expenses in connection with the performance of our obligations relating to the registration of the exchange notes and the conduct of the exchange offer. These expenses include registration and filing fees, accounting and legal fees and printing costs, among others. We will pay the exchange agent reasonable and customary fees for its services and reasonable out-of-pocket expenses. We will also reimburse brokerage houses and other custodians, nominees and fiduciaries for customary mailing and handling expenses incurred by them in forwarding this prospectus and related documents to their clients that are holders of initial notes and for handling or tendering for such clients.

We have not retained any dealer-manager in connection with the exchange offer and will not pay any fee or commission to any broker, dealer, nominee or other person, other than the exchange agent, for soliciting tenders of initial notes pursuant to the exchange offer.

Accounting Treatment

We will record the exchange notes in our accounting records at the same carrying value as the initial notes, which is the aggregate principal amount as reflected in our accounting records on the date of exchanges. Accordingly, we will not recognize any gain or loss for accounting purposes upon the consummation of the exchange offer. We will record the expenses of the exchange offer as incurred.

Transfer Taxes

We will pay all transfer taxes, if any, applicable to the exchanges of initial notes under the exchange offer. The tendering holder, however, will be required to pay any transfer taxes, whether imposed on the registered holder or any other person, if:

 

  •  

certificates representing initial notes for principal amounts not tendered or accepted for exchange are to be delivered to, or are to be issued in the name of, any person other than the registered holder of initial notes tendered;

 

  •  

tendered initial notes are registered in the name of any person other than the person signing the letter of transmittal; or

 

  •  

a transfer tax is imposed for any reason other than the exchange of initial notes under the exchange offer.

If satisfactory evidence of payment of such taxes is not submitted with the letter of transmittal, the amount of such transfer taxes will be billed to that tendering holder.

 

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Holders who tender their initial notes for exchange will not be required to pay any transfer taxes. However, holders who instruct us to register exchange notes in the name of, or request that initial notes not tendered or not accepted in the exchange offer be returned to, a person other than the registered tendering holder will be required to pay any applicable transfer tax.

Consequences of Failure to Exchange

If you do not exchange your initial notes for exchange notes under the exchange offer, your initial notes will remain subject to the restrictions on transfer of such initial notes as set forth in the legend printed on the initial notes as a consequence of the issuance of the initial notes pursuant to the exemptions from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws.

In general, you may not offer or sell your initial notes unless they are registered under the Securities Act or if the offer or sale is exempt from registration under the Securities Act and applicable state securities laws. Except as required by the registration rights agreements, we do not intend to register resales of the initial notes under the Securities Act.

Other

Participating in the exchange offer is voluntary, and you should carefully consider whether to accept. You are urged to consult your financial and tax advisors in making your own decision on what action to take.

We may in the future seek to acquire untendered initial notes in open market or privately negotiated transactions, through subsequent exchange offers or otherwise. We have no present plans to acquire any initial notes that are not tendered in the exchange offer or to file a registration statement to permit resales of any untendered initial notes.

 

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DESCRIPTION OF SENIOR SECURED SECOND LIEN NOTES

General

In this description, (i) the term “Holdings” refers to Pinafore Holdings B.V. and not its Subsidiaries, (ii) the term “Finance LLC” refers only to Tomkins, LLC, a Delaware limited liability company, and not to any of its Subsidiaries, (iii) the term “Finance Co” refers only to Tomkins, Inc., a Delaware corporation, a direct wholly owned Subsidiary of Finance LLC, and not to any of its Subsidiaries, (iv) the term “Issuers” refers to Finance LLC and Finance Co., and (v) the terms “we,” “our” and “us” each refer to Holdings and its consolidated Subsidiaries. The initial notes were issued and the exchange notes (collectively, the notes) will be issued under an indenture (the “Indenture” or the “Second Lien Notes Indenture”), dated as of September 29, 2010, among the Issuers, the Note Guarantors and Wilmington Trust FSB, as Trustee (the “Trustee” or the “Second Lien Notes Trustee”). The notes are not intended to be and will not be quoted, listed or dealt in or on any stock exchange or over-the-counter market (including The PORTAL Market).

The following summary of certain provisions of the Indenture, the notes, the Security Documents, the Intercreditor Agreement and the Registration Rights Agreement (as defined below) does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all the provisions of the Indenture, the notes, the Security Documents, the Intercreditor Agreement and the Registration Rights Agreement, including the definitions of certain terms therein and those terms made a part thereof by the TIA. Capitalized terms used in this “Description of Senior Secured Second Lien Notes” section and not otherwise defined herein have the meanings set forth in the Indenture.

We issued notes with an initial aggregate principal amount of $1.15 billion. We may issue additional notes from time to time after this offering without notice or the consent of holders of notes. Any offering of additional notes is subject to the covenants described below under the caption “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock.” The notes and any additional notes subsequently issued under the Indenture will be treated as a single class for all purposes under the Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase; provided that if any additional notes are not fungible with the notes for U.S. federal income tax purposes, the additional notes will have a separate CUSIP number. Except as otherwise specified herein, all references to the “notes” include additional notes.

If a holder has given wire transfer instructions to the Issuers or paying agent, the paying agent will deliver payment of all principal, interest and premium, if any, on that holder’s notes in accordance with those instructions. All other payments on the notes will be payable, and the notes may be exchanged or transferred, at the office or agency of paying agent as specified in the Indenture (which initially shall be a corporate trust office of the Trustee) unless the paying agent elects to make interest payments by check mailed to the holders at their addresses set forth in the register of holders.

The notes will be issued only in fully registered form, without coupons, in denominations of $2,000 and any integral multiple of $1,000 in excess thereof.

Terms of the Notes

The notes will be senior obligations of the Issuers and will have the benefit of the security interest in the Collateral set forth in the Indenture and will mature on October 1, 2018. Each note will bear interest at a rate per annum shown on the cover of this prospectus from September 29, 2010 or from the most recent date to which interest has been paid or provided for payable semi-annually to holders of record at the close of business on March 15 or September 15 immediately preceding the interest payment date on April 1 and October 1 of each year, commencing April 1, 2011.

Additional interest will be payable with respect to the notes in certain circumstances if the Issuers do not consummate the exchange offer (or shelf registration, if applicable).

 

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Optional Redemption

On and after October 1, 2014, the Issuers may redeem the notes, at their option, in whole at any time or in part from time to time, upon not less than 30 nor more than 60 days’ prior notice mailed by first class mail to each holder’s registered address or otherwise in accordance with the procedures of the Depository Trust Company (“DTC”), at the following redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest and additional interest, if any, to the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the 12-month period commencing on October 1 of the years set forth below:

 

Period

    Redemption Price  

2014

      104.500 % 

2015

      102.250 % 

2016 and thereafter

      100.000 % 

In addition, at any time prior to October 1, 2014, the Issuers may redeem the notes at their option, in whole at any time or in part from time to time, upon not less than 30 nor more than 60 days’ prior notice mailed by first-class mail to each holder’s registered address or otherwise in accordance with the procedures of DTC, at a redemption price equal to 100% of the principal amount of the notes redeemed plus the Applicable Premium as of, and accrued and unpaid interest and additional interest, if any, to the applicable redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date).

At any time, or from time to time prior to October 1, 2013, but not more than once in any twelve-month period, the Issuers may redeem up to 10% of the original aggregate principal amount of the notes at a redemption price of 103% of the principal amount thereof plus accrued and unpaid interest thereon, if any, to but not including the date of redemption (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date).

Notwithstanding the foregoing, at any time and from time to time on or prior to October 1, 2013, the Issuers may redeem in the aggregate up to 35% of the original aggregate principal amount of the notes (calculated after giving effect to any issuance of additional notes) with the net cash proceeds of one or more Equity Offerings (1) by Holdings or (2) by any direct or indirect parent of the Issuers, to the extent the net cash proceeds thereof are contributed to the common or preferred equity capital (other than Disqualified Stock) of Holdings or the Issuers or used to purchase Capital Stock (other than Disqualified Stock) of Holdings from it, at a redemption price (expressed as a percentage of principal amount thereof) of par plus 9% plus accrued and unpaid interest and additional interest, if any, to the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date); provided, however, that at least 65% of the original aggregate principal amount of the notes (calculated after giving effect to any issuance of additional notes) remain outstanding after each such redemption; and provided, further, that such redemption shall occur within 90 days after the date on which any such Equity Offering is consummated upon not less than 30 nor more than 60 days’ notice mailed to each holder of notes being redeemed and otherwise in accordance with the procedures set forth in the Indenture.

In connection with any redemption of notes (including with the net cash proceeds of an Equity Offering), any such redemption may, at the Issuers’ discretion, be subject to one or more conditions precedent, including any related Equity Offering. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice shall state that, in the Issuers’ discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the redemption date, or by the redemption date so delayed.

Subject to applicable federal and state securities laws, the Issuers or their affiliates may at any time and from time to time purchase notes or our other indebtedness. Any such purchases may be made through open market or privately negotiated transactions with third parties or pursuant to one or more tender or exchange offers or otherwise, upon such terms and at such prices as well as with such consideration as the Issuers or any such affiliates may determine.

Selection

In the case of any partial redemption, selection of the notes for redemption will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which such notes are listed, or if such notes are not so listed, pro rata or by lot or such other method as the Trustee shall deem fair and appropriate (and in such manner as complies with applicable legal requirements); provided, that the Trustee shall not select notes for redemption which would result in a holder of notes with a principal amount of notes less than the minimum denomination. If any note is to be redeemed in part only, the notice of redemption relating to such note shall state the portion of the principal amount thereof to be redeemed. A new note in principal amount equal to the unredeemed portion thereof will be issued in the name of the holder thereof upon cancellation of the original note. On and after the redemption date, interest will cease to accrue on notes or portions thereof called for redemption so long as the Issuers have deposited with the paying agent funds sufficient to pay the principal of, plus accrued and unpaid interest and additional interest (if any) on, the notes to be redeemed.

Ranking

The indebtedness evidenced by the notes will be senior Indebtedness of the Issuers, will be equal in right of payment to all existing and future Second Lien Obligations, will be effectively senior in right of payment to all senior unsecured Indebtedness of the Issuers to the extent of the Collateral, will have the benefit of the security interest in the Collateral described below under “—Security for the Notes” and will be senior in right of payment to all existing and future Subordinated Indebtedness of the Issuers.

 

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The indebtedness evidenced by the Note Guarantees will be senior Indebtedness of the applicable Note Guarantor, will be equal in right of payment to all existing and future Second Lien Obligations of such Note Guarantor, will have the benefit of the security interest in the Collateral described below under “—Security for the Notes”, will be effectively senior in right of payment to all senior unsecured Indebtedness of such Note Guarantor to the extent of the Collateral and will be senior in right of payment to all existing and future Subordinated Indebtedness of such Note Guarantor.

At April 2, 2011, Holdings and its Restricted Subsidiaries had $3,359.0 million of indebtedness outstanding (excluding $107.6 million of letters of credit).

Although the Indenture will limit the Incurrence of Indebtedness by Holdings and its Restricted Subsidiaries and the issuance of Disqualified Stock and Preferred Stock by the Restricted Subsidiaries, such limitation is subject to a number of significant qualifications and exceptions. Under certain circumstances, Holdings and its Restricted Subsidiaries may be able to incur substantial amounts of Indebtedness. Such Indebtedness may be secured Indebtedness constituting Second Lien Obligations. See “—Certain Covenants—Liens” and “Certain Covenants—Limitations on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock.”

Security for the Notes

The notes and the Note Guarantees will be secured by security interests in the Collateral, subject to Permitted Liens. The Collateral consists of substantially all of the property and assets, in each case, that are held by the Issuers or any of the U.S. Note Guarantors, subject to the exceptions described below. In addition, the collateral in non-U.S. jurisdictions will consist of those types of assets customarily provided as security for bank loans with certain agreed exceptions.

The Collateral does not include (i) any rights of a grantor with respect to any contract, lease, license or other agreement if (but only to the extent that) the grant of a security interest therein would (x) constitute a violation (including a breach or default) of, a restriction in respect of, or result in the abandonment, invalidation or unenforceability of, such rights in favor of a third party or in conflict with any law, regulation, permit, order or decree of any governmental authority, unless and until all required consents shall have been obtained or (y) expressly give any other party (other than another grantor or its affiliates) in respect of any such contract, lease, license or other agreement, the right to terminate its obligations thereunder; subject to certain qualifications; (ii) any assets to the extent and for so long as the pledge of or security interest in such assets is prohibited by law and such prohibition is not overridden by the UCC or other applicable law; (iii) Equity Interest in excess of 65% of the issued and outstanding Equity Interest entitled to vote of any Foreign Subsidiary of an Issuer or any domestic Note-Guarantor (or any domestic Subsidiary that is treated as a disregarded entity under the Code if substantially all of its assets consist of the Equity Interests of one or more Subsidiaries that are controlled foreign corporations within the meaning of Section 957 of the Code); (iv) any “intent-to use” trademark applications filed, unless and until acceptable evidence of use of such trademark has been filed with and accepted by the US Patent and Trademark Office, to the extent that granting a lien in such trademark application prior to such filing would adversely affect the enforceability, validity, or other rights in such trademark application; (v) assets owned by any grantor on the Issue Date or thereafter acquired that are subject to certain Permitted Liens, if and to the extent that the contract or other agreement pursuant to which such Lien is granted or to which such assets are subject (or the documentation relating thereto) prohibits the creation of any other Lien on such asset; (vi) any particular assets if, in the reasonable judgment of the Issuers evidenced in writing, creating a pledge thereof or security interest therein to the Second Lien Collateral Agent for the benefit of the Holders would result in any material adverse tax consequences to Holdings or its Restricted Subsidiaries; (vii) certain immaterial real property and (viii) any particular assets if the burden, cost or consequences (including any adverse tax consequences) to Holdings or its Restricted Subsidiaries of creating or perfecting such pledges or security interests in such assets in favor of the Second Lien Collateral Agent for the benefit of the holders is excessive in relation to the benefits to be obtained therefrom by the holders.

In addition, in the event that Rule 3-16 of Regulation S-X under the Securities Act and the Exchange Act (or any successor regulation) is amended, modified or interpreted by the SEC to require (or is replaced with another rule or regulation, or any other law, rule or regulation is adopted, which would require) the filing with the SEC (or any other governmental agency) of separate financial statements of any Subsidiary of Holdings due to the fact that such Subsidiary’s securities secure the notes, then the securities of such Subsidiary will not be subject to the Liens securing the notes and will automatically be deemed not to be part of the Collateral but only to the extent necessary not to be subject to such requirement and only for so long as required to not be subject to the requirement. In the event that Rule 3-16 of Regulation S-X under the Securities Act and the Exchange Act (or any successor regulation) is amended, modified or interpreted by the SEC to permit (or is replaced with another rule or regulation, or any other law, rule or regulation is adopted, which would require) such Subsidiary’s securities to secure the notes in excess of the amount then pledged without the filing with the SEC (or any other governmental agency) of separate financial statements of such Subsidiary, then the securities of such Subsidiary will automatically be deemed to be a part of the Collateral but only to the extent permitted to not be subject to any such financial statement requirement. Except for equity interests and certain other assets of certain of our Subsidiaries, to the extent any Senior Obligations (other than the notes) are secured by any assets of any Note Guarantor or any Issuer, the Second Lien Note Obligations shall be secured by such assets.

 

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Security interests securing the notes and the proceeds and distributions in respect thereof will be subject to intercreditor arrangements described under “Second Lien Intercreditor Agreement.” The Persons holding other Second Lien Obligations may have rights and remedies with respect to the property subject to such Liens that, if exercised, could adversely affect the value of the Collateral or the ability of the Second Lien Collateral Agent to realize or foreclose on the Collateral on behalf of holders of the notes.

The Issuers and the Note Guarantors are and will be able to incur additional indebtedness in the future that could share in the Collateral, including additional Senior Obligations and Second Lien Obligations. The amount of such Obligations and additional Indebtedness is and will be limited by the covenants described under “—Certain Covenants—Liens” and “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock.” Under certain circumstances, the amount of such Obligations could be significant.

Post-Closing Matters

Other than the pledge of the capital stock of Tomkins plc, the Issuers may not have any of the security interests on the Collateral in place on the Issue Date. The Issuers will be required to have (i) all security interests in any Collateral constituting personal property located in the United States and Canada in place and perfected no later than 60 days following the Issue Date and (ii) all security interests in any Collateral constituting personal property located outside the United States and Canada or any real property to be in place and perfected no later than 90 days following the Issue Date, or in each case such longer period to the extent such longer period has been agreed to by the Credit Agreement Collateral Agent with respect to the Credit Agreement Indebtedness.

After-Acquired Collateral

From and after the Issue Date and subject to certain limitations and exceptions, if the Issuers or any Note Guarantor creates any additional security interest upon any property or asset that would constitute Collateral to secure any Senior Obligations, it must concurrently grant a second-priority perfected security interest (subject to Permitted Liens) upon such property as security for the notes and the Note Guarantees and if the Issuers or any Note Guarantor creates any additional security interest upon any property or asset that would constitute Collateral to secure any Second Lien Obligations, it must concurrently grant a pari passu-priority perfected security interest (subject to Permitted Liens) upon such property as security for the notes and the Note Guarantees.

Security Documents

The Issuers, the Note Guarantors and the Second Lien Collateral Agent will enter into one or more Security Documents defining the terms of the security interests that secure the notes and the Note Guarantees. These security interests will secure the payment and performance when due of all of the Obligations of the Issuers and the Note Guarantors under the notes, the Indenture, the Note Guarantees and the Security Documents, as provided in the Security Documents. The Second Lien Collateral Agent will act as a collateral agent on behalf of the Trustee and the noteholders.

Second Lien Intercreditor Agreement

The Credit Agreement Collateral Agent, the Second Lien Collateral Agent, Holdings and the Subsidiaries of Holdings party thereto will enter into the Second Lien Intercreditor Agreement, which may be amended from time to time without the consent of the holders of the notes to add other parties holding including the Second Lien Note Obligations and Senior Obligations permitted to be incurred under the relevant agreements.

Pursuant to the terms of the Second Lien Intercreditor Agreement, prior to the Discharge of Senior Obligations, the Senior Representative, acting on behalf of the Senior Secured Parties, will determine the time and method by which the security interests in the Collateral will be enforced and will have the sole and exclusive right to manage, perform and enforce the terms of the Security Documents relating to the Collateral and to exercise and enforce all privileges, rights and remedies thereunder according to its direction, including to take or retake control or possession of such Collateral and to hold, prepare for sale, marshall, process, sell, lease, dispose of or liquidate such Collateral, including, without limitation, following the occurrence of a Default or Event of Default under the Indenture. The Second Lien Collateral Agent will not be permitted to enforce the security interests even if any event of default under the Second Lien Note Documents has occurred and the Second Lien Note Obligations thereunder have been accelerated except (a) in any insolvency or liquidation proceeding, solely as necessary to file a proof of claim or statement of interest with respect to the Second Lien Note Obligations or (b) as necessary to take any action in order to prove, preserve, perfect or protect (but not enforce) its security interest and rights in, and the perfection and priority of its Lien on, the Collateral.

The Second Lien Collateral Agent, for itself and on behalf of each Second Lien Note Secured Party, has agreed pursuant to the Second Lien Intercreditor Agreement that (a) it will not (and thereby waives any right to) take any action to challenge, contest or support any other Person in contesting or challenging, directly or indirectly, in any proceeding (including any insolvency or liquidation proceeding), the validity, perfection, priority or enforceability of a Lien securing any Senior Obligations held (or purported to be held) by or on behalf of the Senior Representative or any of the Senior Secured Parties or any agent or trustee therefor in any

 

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Collateral or other collateral securing both the Senior Obligations and any Second Lien Note Obligations and (b) it will not oppose or otherwise contest (or support any other Person contesting) any request for judicial relief made in any court by the Senior Representative or any Senior Secured Parties relating to the lawful enforcement of any first lien on Collateral or other collateral securing both the Senior Obligations and any Second Lien Note Obligations.

 

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In addition, the Security Documents provide that prior to the Discharge of Senior Obligations, the Senior Representative may take actions with respect to the Collateral (including the release of Collateral and the manner of realization (subject to the provisions described under “—Release of Collateral”)) without the consent of the Second Lien Collateral Agent or other Second Lien Note Secured Parties.

The Collateral or proceeds thereof received in connection with the sale or other disposition of, or collection on, such Collateral upon the exercise of remedies will be applied to the Senior Obligations to be distributed prior to application to any Second Lien Note Obligations in such order as specified in the relevant Senior Documents until the Discharge of Senior Obligations has occurred.

In addition, so long as the Discharge of Senior Obligations has not occurred, the Second Lien Collateral Agent shall not acquire or hold any Lien on any assets of Holdings or any Subsidiary (and neither Holdings nor any Subsidiary shall grant such Lien) securing any Second Lien Note Obligations that are not also subject to the first lien in respect of the Senior Obligations under the Senior Documents (other than funds deposited for the discharge or defeasance of the Second Lien Notes to the extent permitted by the relevant documents).

The Second Lien Collateral Agent and each other Second Lien Note Secured Party will agree that any Lien purported to be granted on any collateral as security for Senior Obligations shall be deemed to be and shall be deemed to remain senior in all respects and prior to all Liens on such collateral securing any Second Lien Note Obligations for all purposes regardless of whether the Lien purported to be granted is found to be improperly granted, improperly perfected, preferential, a fraudulent conveyance or legally or otherwise deficient in any manner.

If any Senior Secured Party is required in any insolvency or liquidation proceeding or otherwise to turn over or otherwise pay to the estate of an Issuer or any Note Guarantor (or any trustee, receiver or similar person therefor), because the payment of such amount was declared to be fraudulent or preferential in any respect or for any other reason, any amount (a “Recovery”), whether received as proceeds of security, enforcement of any right of setoff or otherwise, then as among the parties thereto, the Senior Obligations shall be deemed to be reinstated to the extent of such Recovery and to be outstanding as if such payment had not occurred and such Senior Secured Party shall be entitled to a reinstatement of Senior Obligations with respect to all such recovered amounts and shall have all rights thereunder. If the Second Lien Intercreditor Agreement shall have been terminated prior to such Recovery, the Second Lien Intercreditor Agreement shall be reinstated in full force and effect, and such prior termination shall not diminish, release, discharge, impair or otherwise affect the obligations of the parties thereto.

The Second Lien Intercreditor Agreement will provide that so long as the Discharge of Senior Obligations has not occurred, whether or not any insolvency or liquidation proceeding has been commenced by or against an Issuer or any Note Guarantor, (i) neither the Second Lien Collateral Agent nor any Second Lien Note Secured Party will (x) exercise or seek to exercise any rights or remedies (including setoff or the right to credit bid debt (except under limited circumstances)) with respect to any collateral securing both the Senior Obligations and any Second Lien Note Obligations in respect of any applicable Second Lien Note Obligations, or institute any action or proceeding with respect to such rights or remedies (including any action of foreclosure), (y) contest, protest or otherwise object to any foreclosure or enforcement proceeding or action brought with respect to the Collateral or any other collateral by the Senior Representative or any Senior Secured Party in respect of the Senior Obligations, the exercise of any right by the Senior Representative or any Senior Secured Party (or any agent or sub-agent on their behalf) in respect of the Senior Obligations under any control agreement, lockbox agreement, landlord waiver or bailee’s letter or similar agreement or arrangement to which the Second Lien Collateral Agent or any Second Lien Note Secured Party either is a party or may have rights as a third-party beneficiary, or any other exercise by any such party of any rights and remedies as a secured party relating to such collateral or any other collateral under the Senior Documents or otherwise in respect of Senior Obligations, or (z) object to any waiver or forbearance by the Senior Secured Parties from or in respect of bringing or pursuing any foreclosure proceeding or action or any other exercise of any rights or remedies relating to such collateral or any other collateral in respect of Senior Obligations and (ii) except as otherwise provided in the Second Lien Intercreditor Agreement, the Senior Representative and the Senior Secured Parties shall have the sole and exclusive right to enforce rights, exercise remedies (including setoff and the right to credit bid their debt), marshal, process and make determinations regarding the release, disposition or restrictions, or waiver or forbearance of rights or remedies with respect to such collateral without any consultation with or the consent of the Second Lien Collateral Agent or any Second Lien Note Secured Party.

In addition, the Second Lien Collateral Agent and each other Second Lien Note Secured Party will agree, among other things, that if an Issuer or any Note Guarantor is subject to any insolvency or liquidation proceeding and the Senior Representative desires to permit the use of cash collateral or to permit an Issuer or any Note Guarantor to obtain DIP Financing, including if such DIP Financing is secured by Liens senior in priority to the Liens securing the Second Lien Note Obligations, then the Second Lien Collateral Agent, on behalf of itself and each applicable Second Lien Note Secured Party, will not object to such use of cash collateral or DIP Financing and will not request adequate protection or any other relief in connection therewith (except to the extent permitted by the Second Lien Intercreditor Agreement) and, to the extent the Liens securing the Senior Obligations are subordinated or pari passu with such DIP Financing, will subordinate its Liens in the Collateral and any other collateral to such DIP Financing (and all Obligations relating thereto) on the same basis as they are subordinated to the Senior Obligations.

 

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Subject to the terms of the Security Documents, the Issuers and the Note Guarantors have the right to remain in possession and retain exclusive control of the Collateral securing the notes and the Notes Obligations (other than securities, instruments and chattel paper constituting part of the Collateral and deposited with the Senior Representative in accordance with the provisions of the Senior Security Documents), to freely operate the Collateral and to collect, invest and dispose of any income therefrom.

Release of Collateral

The Issuers and the Note Guarantors are entitled to the releases of property and other assets included in the Collateral from the Liens securing the notes under any one or more of the following circumstances:

(1) to enable us to consummate the disposition of such property or assets to the extent not prohibited under the covenant described under “—Certain Covenants—Asset Sales”;

(2) in the case of a Note Guarantor that is released from its Note Guarantee with respect to the notes, the release of the property and assets of such Note Guarantor;

(3) as described under “—Amendment, Supplement and Waiver” below; or

(4) to the extent required by the terms of the Second Lien Intercreditor Agreements.

The security interests in all Collateral securing the notes also will be released upon (i) payment in full of the principal of, together with accrued and unpaid interest (including additional interest, if any) on, the notes and all other Obligations under the Indenture, the Note Guarantees and the Security Documents that are due and payable at or prior to the time such principal, together with accrued and unpaid interest (including additional interest, if any), are paid (including pursuant to a satisfaction and discharge of the Indenture as described below under “—Satisfaction and Discharge”) or (ii) a legal defeasance or covenant defeasance under the Indenture as described below under “—Defeasance.”

Note Guarantees

As promptly as practicable and in any event within 60 days of the Issue Date (the “60 Day Post-Closing Period”) Holdings and each of its Restricted Subsidiaries (other than the Issuers), that are borrowers or guarantors under the Credit Agreement, excluding certain entities that would trigger a Rule 3-10 release as reasonably determined by Holdings, will jointly and severally irrevocably and unconditionally guarantee on a second lien basis the performance and punctual payment when due, whether at Stated Maturity, by acceleration or otherwise, of all obligations of the Issuers under the Indenture and the notes, whether for payment of principal of, premium, if any, or interest or additional interest on the notes, expenses, indemnification or otherwise (all such obligations guaranteed by such Note Guarantors being herein called the “Guaranteed Obligations”).

Each Note Guarantee of a Note Guarantor will rank:

 

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equally in right of payment with all existing and future senior Indebtedness of such Note Guarantor but, to the extent of the value of the Collateral, will be effectively senior to such Indebtedness;

 

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senior in right of payment to all existing and future Subordinated Indebtedness of such Note Guarantor, if any;

 

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effectively subordinated to any obligations of such Note Guarantor secured by Permitted Liens to the extent of the value of the assets of such Note Guarantor to these Permitted Liens; and

 

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structurally subordinated to any Indebtedness or Obligations of any of such Note Guarantor’s non-Guarantor Subsidiaries.

Each Note Guarantee will be limited in amount to an amount not to exceed the maximum amount that can be guaranteed by the applicable Note Guarantor without rendering the Note Guarantee, as it relates to such Note Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally. See “Risk Factors—Risk Related to the Notes.” Thereafter, Holdings will cause each Restricted Subsidiary (unless such Subsidiary is already a Note Guarantor) that guarantees the Credit Agreement or any other capital markets debt securities of the Issuers or any Note Guarantor to execute and deliver to the Trustee a supplemental indenture pursuant to which such Restricted Subsidiary will guarantee payment of the notes on the same senior basis. See “—Certain Covenants—Future Guarantors.”

Each Note Guarantee will be a continuing guarantee and, subject to the next succeeding paragraph, shall:

(1) remain in full force and effect until payment in full of all the Guaranteed Obligations;

(2) be binding upon each such Note Guarantor and its successors; and

 

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(3) inure to the benefit of and be enforceable by the Trustee, the holders and their successors, transferees and assigns.

A Note Guarantee of a Note Guarantor will be automatically released and discharged upon:

(a) the sale, disposition or other transfer (including through merger or consolidation) of the Capital Stock (including any sale, disposition or other transfer following which the applicable Note Guarantor is no longer a Restricted Subsidiary), or all or substantially all the assets, of the applicable Note Guarantor if such sale, disposition or other transfer is made in compliance with the Indenture,

(b) Holdings designating such Note Guarantor to be an Unrestricted Subsidiary in accordance with the provisions set forth under “—Certain Covenants—Limitation on Restricted Payments” and the definition of “Unrestricted Subsidiary,”

(c) the case of any Restricted Subsidiary that after the Issue Date is required to guarantee the notes pursuant to the covenant described under “—Certain Covenants—Future Guarantors,” the release or discharge of the guarantee by such Restricted Subsidiary of Indebtedness of Holdings or any Restricted Subsidiary of Holdings or such Restricted Subsidiary or the repayment of the Indebtedness or Disqualified Stock, in each case, which resulted in the obligation to guarantee the notes, except if a release or discharge is by or as a result of payment under such other guarantee,

(d) the Issuers’ exercise of their legal defeasance option or covenant defeasance option as described under “—Defeasance,” or if the Issuers’ obligations under the Indenture are discharged in accordance with the terms of the Indenture,

(e) upon the release or discharge of all other Guarantees by such Guarantor of Indebtedness of the Issuers or any other Guarantor, except if a release or discharge is by or as a result of payment under such other guarantees, or

(f) the event that Rule 3-10 of Regulation S-X under the Securities Act (“Rule 3-10”) would require separate financial statements of any Subsidiary of Holdings that is a Note Guarantor to be filed with the SEC solely because such Subsidiary’s Note Guarantee is not a Full and Unconditional guarantee under the notes and the Indenture as reasonably determined by Holdings (the “Rule 3-10 Limitation”); provided, however, that such Subsidiary’s Note Guarantee will automatically be reinstated or provided on such date that it is reasonably determined by Holdings that the Rule 3-10 Limitation no longer exist.

Notwithstanding anything else to the contrary, Holdings will be a guarantor to the notes for so long as the notes are outstanding.

“Full and Unconditional” has the meaning set forth in Rule 3-10 of Regulation S-X promulgated pursuant to the Securities Act.

Holdings’ Subsidiaries (other than the Issuers) that are not expected to be Note Guarantors accounted for: (i) 40% of our sales; (ii) 46% of our Adjusted EBITDA; (iii) 40% of our total assets; and (iv) 24% of our total liabilities. All of the above percentages are calculated from ongoing operations only, and are as of and for the twelve months ended July 3, 2010. Both (i) and (ii) are calculated excluding corporate center entities.

Change of Control

Upon the occurrence of any of the following events (each, a “Change of Control”), each holder will have the right to require the Issuers to repurchase all or any part of such holder’s notes at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of repurchase (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), except to the extent the Issuers have previously elected to redeem notes as described under “—Optional Redemption”:

(1) the sale, lease or transfer, in one or a series of related transactions, of all or substantially all the assets of Holdings and its Subsidiaries, taken as a whole, to a Person other than any of the Permitted Holders; or

(2) Holdings becomes aware (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) of the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than any of the Permitted Holders, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision), of more than 50% of the total voting power of the Voting Stock of Holdings, or any direct or indirect parent of Holdings.

Notwithstanding the foregoing, no Specified Merger/Transfer Transaction, as described under “—Merger, Consolidation or Sale of All or Substantially All Assets” shall constitute a Change of Control.

 

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Within 30 days following any Change of Control, except to the extent that the Issuers have exercised their right to redeem the notes as described under “—Optional Redemption,” the Issuers shall mail a notice (a “Change of Control Offer”) to each holder with a copy to the Trustee describing:

(1) that a Change of Control has occurred and that such holder has the right to require the Issuers to purchase such holder’s notes at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, to the date of purchase (subject to the right of holders of record on a record date to receive interest on the relevant interest payment date);

(2) the transaction or transactions constitute a Change of Control;

(3) the repurchase date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is sent); and

(4) the instructions determined by the Issuers that a holder must follow in order to have its notes purchased.

The Issuers will not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by the Issuers and purchases all notes validly tendered and not withdrawn under such Change of Control Offer.

A Change of Control Offer may be made in advance of a Change of Control, and conditioned upon such Change of Control.

The Issuers will comply, to the extent applicable, with the requirements of Rule 14(e)-1 of the Exchange Act and any other securities laws or regulations in connection with the repurchase of notes pursuant to this covenant. To the extent that the provisions of any securities laws or regulations conflict with provisions of such covenant, the Issuers will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this paragraph by virtue of such compliance.

The provisions under the Indenture relating to the Issuers’ obligation to make an offer to repurchase the notes as a result of a Change of Control may be waived or modified with the written consent of the holders of a majority in principal amount of the notes.

Certain Covenants

Set forth below are summaries of certain covenants contained in the Indenture. If on any date following the Issue Date (i) the notes have Investment Grade Ratings from both Rating Agencies, and (ii) no Default has occurred and is continuing under the Indenture (the occurrence of the events described in the foregoing clauses (i) and (ii) being collectively referred to as a “Covenant Suspension Event”), Holdings and its Restricted Subsidiaries will not be subject to the following covenants or provisions (collectively, the “Suspended Covenants”):

(1) “—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”;

(2) “—Limitation on Restricted Payments”;

(3) “—Dividend and Other Payment Restrictions Affecting Subsidiaries”;

(4) “—Asset Sales”;

(5) “—Transactions with Affiliates”;

(6) clause (4) of the first paragraph of “—Merger, Consolidation or Sale of All or Substantially All Assets”; and

(7) “—Future Guarantors.”

In the event that Holdings and its Restricted Subsidiaries are not subject to the Suspended Covenants under the Indenture for any period of time as a result of the foregoing, and on any subsequent date (the “Reversion Date”) one or both of the Rating Agencies withdraw their Investment Grade Rating or downgrade the rating assigned to the notes below an Investment Grade Rating, then Holdings and its Restricted Subsidiaries will thereafter again be subject to the Suspended Covenants under the Indenture with respect to future events.

 

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The period of time between the occurrence of a Covenant Suspension Event and the Reversion Date is referred to in this description as the “Suspension Period.” Additionally, upon the occurrence of a Covenant Suspension Event, the amount of Excess Proceeds from Net Cash Proceeds shall be reset at zero. In the event of any such reinstatement, no action taken or omitted to be taken by Holdings or any of its Restricted Subsidiaries prior to such reinstatement will give rise to a Default or Event of Default under the Indenture with respect to notes; provided that (1) with respect to Restricted Payments made after any such reinstatement, the amount of Restricted Payments made will be calculated as though the covenant described under the caption “—Limitation on Restricted Payments” had been in effect prior to, but not during, the Suspension Period, provided that no Subsidiaries may be designated as Unrestricted Subsidiaries during the Suspension Period, and (2) all Indebtedness Incurred, or Disqualified Stock or Preferred Stock issued, during the Suspension Period will be classified to have been Incurred or issued pursuant to clause (c) of the second paragraph of “—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock.” In addition, for purposes of the covenant described under “—Transactions with Affiliates,” all agreements and arrangements entered into by Holdings and any Restricted Subsidiary with an Affiliate of Holdings during the Suspension Period prior to such Reversion Date will be deemed to have been entered into on or prior to the Issue Date and for purposes of the covenant described under “—Dividend and Other Payment Restrictions Affecting Subsidiaries,” all contracts entered into during the Suspension Period prior to such Reversion Date that contain any of the restriction contemplated by such covenant will be deemed to have been existing on the Issue Date.

Holdings shall provide an Officer’s Certificate to the Trustee indicating the occurrence of any Covenant Suspension Event or Reversion Date. The Trustee will have no obligation to (i) independently determine or verify if such events have occurred, (ii) make any determination regarding the impact of actions taken during the Suspension Period on Holdings’ and its Subsidiaries future compliance with their covenants or (iii) notify the holders of any Covenant Suspension Event or Reversion Date.

Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock. The Indenture will provide that:

(1) Holdings will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, Incur any Indebtedness (including Acquired Indebtedness) or issue any shares of Disqualified Stock; and

(2) Holdings will not permit any of its Restricted Subsidiaries of Holdings to issue any shares of Preferred Stock;

provided, however, that Holdings and any Restricted Subsidiary of Holdings may Incur Indebtedness (including Acquired Indebtedness) or issue shares of Disqualified Stock and the Issuers and any Restricted Subsidiary that is a Note Guarantor may issue shares of Preferred Stock, in each case if the Fixed Charge Coverage Ratio of Holdings and its Restricted Subsidiaries for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is Incurred or such Disqualified Stock or Preferred Stock is issued would have been at least 2.00 to 1.00, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been Incurred, or the Disqualified Stock or Preferred Stock had been issued, as the case may be, and the application of proceeds therefrom had occurred at the beginning of such four-quarter period; provided, further, that the amount of Indebtedness (excluding Acquired Indebtedness not incurred in connection with or in contemplation of the applicable merger, acquisition or other similar transaction) that may be Incurred and Disqualified Stock or Preferred Stock that may be issued pursuant to the foregoing by Restricted Subsidiaries that are not Note Guarantors of the notes shall not exceed $100.0 million at any one time outstanding pursuant to this paragraph and clause (u) below at such time.

The foregoing limitations will not apply to (collectively, “Permitted Debt”):

(a) the Incurrence by Holdings or its Restricted Subsidiaries of Indebtedness under any Credit Agreement and the issuance and creation of letters of credit and bankers’ acceptances thereunder (with letters of credit and bankers’ acceptances being deemed to have a principal amount equal to the face amount thereof) up to an aggregate principal amount not to exceed $2,700.0 million outstanding at any one time, less (i) the amount of all permanent reductions of Indebtedness thereunder as a result of principal payments actually made with Net Cash Proceeds from Asset Sales and (ii) the aggregate principal amount of Indebtedness Incurred and outstanding pursuant to a Qualified Receivables Financing;

(b) the Incurrence by the Issuers and the Note Guarantors of Indebtedness represented by the notes (not including any additional notes) and the Note Guarantees, as applicable (and any exchange notes and guarantees thereof);

(c) Indebtedness and Preferred Stock existing on the Issue Date (other than Indebtedness described in clauses (a) and (b));

(d) Indebtedness (including without limitation Capitalized Lease Obligations, mortgage financings or purchase money obligations) Incurred by Holdings or any of its Restricted Subsidiaries, Disqualified Stock issued by Holdings or any of its Restricted Subsidiaries and Preferred Stock issued by any Restricted Subsidiaries of Holdings to finance, all or any part of the purchase, lease, construction, installation, repair or improvement of property (real or personal), plant or

 

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equipment or other fixed or capital assets used or useful in the business of Holdings or its Restricted Subsidiaries or in a Permitted Business (whether through the direct purchase of assets or the Capital Stock of any Person owning such assets) in an aggregate principal amount, including all Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (d), not to exceed $150.0 million at the time of Incurrence, at any one time outstanding;

(e) Indebtedness in respect of any bankers’ acceptance, bank guarantees, letter of credit, warehouse receipt or similar facilities, and reinvestment obligations related thereto, entered into in the ordinary course of business; provided, however, that upon the drawing of such letters of credit, such obligations are reimbursed within 30 days following such drawing;

(f) Indebtedness arising from agreements of Holdings or a Restricted Subsidiary of Holdings providing for indemnification, adjustment of purchase price or similar obligations, in each case, Incurred in connection with the disposition of any business, assets or a Subsidiary of the Issuers in accordance with the terms of the Indenture, other than guarantees of Indebtedness Incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition;

(g) [Intentionally Omitted]

(h) shares of Preferred Stock of a Restricted Subsidiary issued to Holdings or another Restricted Subsidiary; provided that any subsequent issuance or transfer of any Capital Stock or any other event that results in any Restricted Subsidiary that holds such shares of Preferred Stock of another Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such shares of Preferred Stock (except to Holdings or another Restricted Subsidiary) shall be deemed, in each case, to be an issuance of shares of Preferred Stock;

(i) Indebtedness or Disqualified Stock of Holdings or a Restricted Subsidiary to another Restricted Subsidiary or to Holdings; provided that if an Issuer or a Note Guarantor Incurs such Indebtedness or issues such Disqualified Stock to a Restricted Subsidiary that is not an Issuer or a Note Guarantor such Indebtedness or Disqualified Stock, as applicable, is subordinated in right of payment to the Note Guarantee of such Note Guarantor; provided, further, that any subsequent issuance or transfer of any Capital Stock or any other event which results in any Restricted Subsidiary lending such Indebtedness or Disqualified Stock, as applicable, ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such Indebtedness or Disqualified Stock, as applicable, (except to Holdings or another Restricted Subsidiary) shall be deemed, in each case, to be an Incurrence of such Indebtedness or Disqualified Stock, as applicable;

(j) Hedging Obligations that are Incurred in the ordinary course of business (and not for speculative purposes): (1) for the purpose of fixing or hedging interest rate risk with respect to any Indebtedness that is permitted by the terms of the Indenture to be outstanding; (2) for the purpose of fixing or hedging currency exchange rate risk with respect to any currency exchanges; or (3) for the purpose of fixing or hedging commodity price risk with respect to any commodity purchases;

(k) obligations (including reimbursement obligations with respect to letters of credit and bank guarantees) in respect of performance, bid, appeal and surety bonds and completion guarantees provided by Holdings or any of its Restricted Subsidiary in the ordinary course of business;

(l) Indebtedness or Disqualified Stock of Holdings, the Issuers or any other Note Guarantor and Preferred Stock of the Issuers or any Note Guarantor that is a Restricted Subsidiary of Holdings in an aggregate principal amount or liquidation preference that, when aggregated with the principal amount or liquidation preference of all other Indebtedness, Disqualified Stock and Preferred Stock then outstanding and Incurred pursuant to this clause (l), does not exceed the greater of 4.0% of Total Assets of Holdings and its Restricted Subsidiaries and $150.0 million at any one time outstanding;

(m) any guarantee by Holdings or its Restricted Subsidiary of Indebtedness or other obligations of Holdings or any of its Restricted Subsidiaries so long as the Incurrence of such Indebtedness or other obligations by Holdings or such Restricted Subsidiary is permitted under the terms of the Indenture; provided that if such Indebtedness is by its express terms subordinated in right of payment to the notes or the Note Guarantee of such Restricted Subsidiary, as applicable, any such guarantee of such Note Guarantor with respect to such Indebtedness shall be subordinated in right of payment to such Note Guarantor’s Note Guarantee with respect to the notes substantially to the same extent as such Indebtedness is subordinated to the notes or the Note Guarantee of such Restricted Subsidiary, as applicable;

 

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(n) the Incurrence by Holdings or any of its Restricted Subsidiaries of Indebtedness or Disqualified Stock or Preferred Stock of a Restricted Subsidiary of Holdings that serves to refund, refinance, replace or defease any Indebtedness, Disqualified Stock or Preferred Stock Incurred as permitted under the first paragraph of this covenant and clauses (b), (c), (n), (q), (s), (t) and (u) of this paragraph or any Indebtedness, Disqualified Stock or Preferred Stock Incurred to so refund or refinance such Indebtedness, Disqualified Stock or Preferred Stock, including any additional Indebtedness, Disqualified Stock or Preferred Stock Incurred to pay premiums, fees and expenses in connection therewith (subject to the following proviso, “Refinancing Indebtedness”) prior to its respective maturity; provided, however, that such Refinancing Indebtedness:

(1) has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is Incurred which is not less than the remaining Weighted Average Life to Maturity of the Indebtedness being refunded or refinanced;

(2) has a Stated Maturity which is no earlier than the Stated Maturity of the Indebtedness being refunded or refinanced;

(3) to the extent such Refinancing Indebtedness refinances (x) Subordinated Indebtedness, such Refinancing Indebtedness is Subordinated Indebtedness, or (y) Disqualified Stock or Preferred Stock, such Refinancing Indebtedness is Disqualified Stock or Preferred Stock;

(4) is Incurred in an aggregate principal amount (or if issued with original issue discount an aggregate issue price) that is equal to or less than the sum of (x) the aggregate principal amount (or if issued with original issue discount, the aggregate accreted value) then outstanding of the Indebtedness being refinanced plus (y) the amount of premium, fees and expenses Incurred in connection with such refinancing; and

(5) shall not include (x) Indebtedness of a Restricted Subsidiary of Holdings that is not an Issuer or a Note Guarantor that refinances Indebtedness of an Issuer or a Note Guarantor, or (y) Indebtedness of Holdings or a Restricted Subsidiary that refinances Indebtedness of an Unrestricted Subsidiary;

(o) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is extinguished within five Business Days of its Incurrence;

(p) Indebtedness of Holdings or any Restricted Subsidiary of Holdings supported by a letter of credit or bank guarantee issued pursuant to the Credit Agreement, in a principal amount not in excess of the stated amount of such letter of credit or bank guarantee;

(q) Contribution Indebtedness;

(r) Indebtedness of Holdings or any Restricted Subsidiary of Holdings consisting of (x) the financing of insurance premiums or (y) take-or-pay obligations contained in supply arrangements, in each case, in the ordinary course of business;

(s) Indebtedness of Foreign Subsidiaries of Holdings that are not Note Guarantors in an aggregate amount not to exceed $200.0 million at any one time outstanding;

(t) Indebtedness Incurred by a Receivables Subsidiary in a Qualified Receivables Financing that is not recourse to Holdings or any Restricted Subsidiary of Holdings other than a Receivables Subsidiary (except for Standard Securitization Undertakings);

(u)(x) Indebtedness, Disqualified Stock or Preferred Stock of the Issuers or any Restricted Subsidiary of Holdings incurred to finance an acquisition or (y) Acquired Indebtedness of the Issuers or any Restricted Subsidiary of Holdings; provided that, in either case, after giving effect to the transactions that result in the incurrence or issuance thereof, on a pro forma basis, either (a) Holdings would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of this covenant or (b) the Fixed Charge Coverage Ratio of Holdings and its Restricted Subsidiaries would not be less than immediately prior to such transactions; provided, however, that on a pro forma basis, together with amounts incurred or issued and outstanding pursuant to the first paragraph of this covenant, no more than $100.0 million of Indebtedness, Disqualified Stock or Preferred Stock at any one time outstanding and incurred or issued by a Restricted Subsidiary of Holdings that is not a Note Guarantor pursuant to this clause (u) shall be incurred or issued and outstanding;

(v) Indebtedness incurred by the Issuers or any Restricted Subsidiary to the extent that the net proceeds thereof are promptly deposited to defease or to satisfy and discharge the notes; and

(w) Guarantees (a) incurred in the ordinary course of business in respect of obligations of (or to) suppliers, customers, franchisees, lessors and licensees that, in each case, are non-Affiliates or (b) otherwise constituting Investments permitted under the Indenture.

 

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For purposes of determining compliance with this covenant, in the event that an item of Indebtedness, Disqualified Stock or Preferred Stock (or any portion thereof) meets the criteria of more than one of the categories of Permitted Debt or is entitled to be Incurred pursuant to the first paragraph of this covenant, the Issuers shall, in their sole discretion, at the time of Incurrence, divide, classify or reclassify, or at any later time divide, classify or reclassify, such item of Indebtedness, Disqualified Stock or Preferred Stock (or any portion thereof) in any manner that complies with this covenant, provided that all Indebtedness under the Credit Agreement outstanding on the Issue Date shall be deemed to have been Incurred pursuant to clause (a) and the Issuers shall not be permitted to reclassify all or any portion of such Indebtedness. Accrual of interest, the accretion of accreted value, the amortization of original issue discount, the payment of interest in the form of additional Indebtedness with the same terms, the payment of dividends on Disqualified Stock or Preferred Stock in the form of additional shares of Disqualified Stock or Preferred Stock of the same class, the accretion of liquidation preference and increases in the amount of Indebtedness outstanding solely as a result of fluctuations in the exchange rate of currencies will not be deemed to be an Incurrence of Indebtedness, Disqualified Stock or Preferred Stock for purposes of this covenant. Note Guarantees of, or obligations in respect of letters of credit relating to, Indebtedness that is otherwise included in the determination of a particular amount of Indebtedness shall not be included in the determination of such amount of Indebtedness, provided that the Incurrence of the Indebtedness represented by such guarantee or letter of credit, as the case may be, was in compliance with this covenant.

For purposes of determining compliance with any U.S. dollar-denominated restriction on the Incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was Incurred, in the case of term debt, or first committed or first Incurred (whichever yields the lower U.S. dollar equivalent), in the case of revolving credit debt; provided that if such Indebtedness is Incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced.

Limitation on Restricted Payments. The Indenture will provide that Holdings will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly:

(1) declare or pay any dividend or make any distribution on account of Holdings’ or any of its Restricted Subsidiaries’ Equity Interests, including any payment made in connection with any merger or consolidation involving Holdings (other than dividends, payments or distributions (A) payable solely in Equity Interests (other than Disqualified Stock) of Holdings or to Holdings and its Restricted Subsidiaries; or (B) by a Restricted Subsidiary or Holdings so long as, in the case of any dividend or distribution payable on or in respect of any class or series of securities issued by a Restricted Subsidiary other than a Wholly Owned Restricted Subsidiary, Holdings or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution in accordance with its Equity Interests in such class or series of securities);

(2) purchase or otherwise acquire or retire for value any Equity Interests of Holdings or any other direct or indirect parent of Holdings;

(3) make any principal payment on, or redeem, repurchase, defease or otherwise acquire or retire for value, in each case prior to any scheduled repayment or scheduled maturity, any Subordinated Indebtedness (other than the payment, redemption, repurchase, defeasance, acquisition or retirement of (A) Subordinated Indebtedness in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of such payment, redemption, repurchase, defeasance, acquisition or retirement and (B) Indebtedness permitted under clause (i) of the second paragraph of the covenant described under “—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”); or

(4) make any Restricted Investment;

(all such payments and other actions set forth in clauses (1) through (4) above being collectively referred to as “Restricted Payments”), unless, at the time of such Restricted Payment:

(a) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof;

(b) immediately after giving effect to such transaction on a pro forma basis, Holdings could Incur $1.00 of additional Indebtedness under the provisions of the first paragraph of the covenant described under “—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”; and

 

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(c) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by Holdings and its Restricted Subsidiaries after the Issue Date (including Restricted Payments permitted by clauses (1), (2) (with respect to Refunding Capital Stock), (6), (8), (13)(b), (16) and (23) of the next succeeding paragraph, but excluding all other Restricted Payments permitted by the next succeeding paragraph), is less than the sum of, without duplication,

(1) 50% of the Consolidated Net Income of Holdings for the period (taken as one accounting period) from January 1, 2011 to the end of Holdings’ most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, in the case such Consolidated Net Income for such period is a deficit, minus 100% of such deficit), plus

(2) 100% of the aggregate net proceeds, including cash and the Fair Market Value of assets other than cash, received by Holdings after the Issue Date from the issue or sale of Equity Interests of Holdings or any direct or indirect parent of Holdings (excluding (without duplication) Refunding Capital Stock (as defined below), Designated Preferred Stock, Cash Contribution Amount, Excluded Contributions and Disqualified Stock), including Equity Interests issued upon conversion of Indebtedness or upon exercise of warrants or options (other than an issuance or sale to a Restricted Subsidiary of Holdings or an employee stock ownership plan or trust established by Holdings or any of its Subsidiaries), plus

(3) 100% of the aggregate amount of contributions to the capital of Holdings received in cash and the Fair Market Value of property other than cash after the Issue Date (other than Excluded Contributions, Refunding Capital Stock, Designated Preferred Stock and Disqualified Stock and the Cash Contribution Amount), plus

(4) the principal amount of any Indebtedness, or the liquidation preference or maximum fixed repurchase price, as the case may be, of any Disqualified Stock, of Holdings or any Restricted Subsidiary thereof issued after the Issue Date (other than Indebtedness or Disqualified Stock issued to Holdings or another Restricted Subsidiary) that has been converted into or exchanged for Equity Interests in Holdings or any direct or indirect parent of Holdings (other than Disqualified Stock), plus

(5) 100% of the aggregate amount received by Holdings or any Restricted Subsidiary in cash and the Fair Market Value of property other than cash received by Holdings or any Restricted Subsidiary from:

(A) the sale or other disposition (other than to Holdings or a Restricted Subsidiary) of Restricted Investments made by Holdings and its Restricted Subsidiaries and from repurchases and redemptions of such Restricted Investments from Holdings and its Restricted Subsidiaries by any Person (other than Holdings or any of its Subsidiaries) and from repayments of loans or advances which constituted Restricted Investments (other than in each case to the extent that the Restricted Investment was made pursuant to clause (7) or (10) of the next succeeding paragraph),

(B) the sale (other than to Holdings or a Restricted Subsidiary of Holdings) of the Capital Stock of an Unrestricted Subsidiary, or

(C) any distribution or dividend from an Unrestricted Subsidiary (to the extent such distribution or dividend is not already included in the calculation of Consolidated Net Income); plus

(6) in the event any Unrestricted Subsidiary of Holdings has been redesignated as a Restricted Subsidiary or has been merged or consolidated with or into, or transfers or conveys its assets to, or is liquidated into, Holdings or a Restricted Subsidiary of Holdings, in each case after the Issue Date, the Fair Market Value (as determined in accordance with the next succeeding sentence) of the Investment of Holdings in such Unrestricted Subsidiary at the time of such redesignation, combination or transfer (or of the assets transferred or conveyed, as applicable), after deducting any Indebtedness associated with the Unrestricted Subsidiary so designated or combined or any Indebtedness associated with the assets so transferred or conveyed (other than in each case to the extent that the designation of such Subsidiary as an Unrestricted Subsidiary was made pursuant to clause (7) or (10) of the next succeeding paragraph or constituted a Permitted Investment).

The foregoing provisions will not prohibit:

(1) the payment of any dividend or distribution or consummation of any irrevocable redemption within 60 days after the date of declaration thereof or the giving of a redemption notice related thereto, if at the date of declaration or notice such payment would have complied with the provisions of the Indenture;

 

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(2)(a) the redemption, repurchase, retirement or other acquisition of any Equity Interests (“Retired Capital Stock”) of Holdings or any direct or indirect parent of Holdings or any Note Guarantor or Subordinated Indebtedness of the Issuers or any Guarantor in exchange for, or out of the proceeds of the substantially concurrent sale of, Equity Interests of Holdings or any direct or indirect parent of Holdings or contributions to the equity capital of Holdings (other than any Disqualified Stock or any Equity Interests sold to Holdings or any Subsidiary of Holdings or to an employee stock ownership plan or any trust established by Holdings or any of its Subsidiaries) (collectively, including any such contributions, “Refunding Capital Stock”); and

(b) the declaration and payment of accrued dividends on the Retired Capital Stock out of the proceeds of the substantially concurrent sale (other than to a Subsidiary of Holdings or to an employee stock ownership plan or any trust established by Holdings or any of its Subsidiaries) of Refunding Capital Stock;

(3) the redemption, repurchase or other acquisition or retirement of Subordinated Indebtedness of an Issuer or any Note Guarantor made by exchange for, or out of the proceeds of the substantially concurrent sale of, new Indebtedness of an Issuer or a Note Guarantor that is Incurred in accordance with the covenant described under “—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock” so long as

(a) the principal amount of such new Indebtedness does not exceed the principal amount (or accredited value, if applicable) of the Subordinated Indebtedness being so redeemed, repurchased, acquired or retired for value (plus the amount of any premium required to be paid under the terms of the instrument governing the Subordinated Indebtedness being so redeemed, repurchased, acquired or retired plus any fees and expenses Incurred in connection therewith);

(b) such Indebtedness is subordinated to the notes or the related Note Guarantee, as the case may be, at least to the same extent as such Subordinated Indebtedness so purchased, exchanged, redeemed, repurchased, acquired or retired for value;

(c) such Indebtedness has a final scheduled maturity no earlier than the final scheduled maturity date of the Subordinated Indebtedness being so redeemed, repurchased, acquired or retired; and

(d) such Indebtedness has a Weighted Average Life to Maturity that is not less than the remaining Weighted Average Life to Maturity of the Subordinated Indebtedness being so redeemed, repurchased, acquired or retired;

(4) the purchase, retirement, redemption or other acquisition (or dividends to Holdings or any other direct or indirect parent of Holdings to finance any such purchase, retirement, redemption or other acquisition) for value of Equity Interests of Holdings or any other direct or indirect parent of Holdings held by any future, present or former employee, director or consultant of Holdings or any direct or indirect parent of Holdings or any Subsidiary of Holdings or their estates or the beneficiaries of such estates pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or other similar agreement or arrangement; provided, however, that the aggregate amounts paid under this clause (4) do not exceed $20.0 million in any calendar year; provided, further, however, that such amount in any calendar year may be increased by an amount not to exceed:

(a) the cash proceeds received by Holdings or any of its Restricted Subsidiaries from the sale of Equity Interests (other than Disqualified Stock) of Holdings or any other direct or indirect parent of Holdings (to the extent contributed to Holdings) to members of management, directors or consultants of Holdings and its Restricted Subsidiaries or Holdings or any other direct or indirect parent of Holdings that occurs after the Issue Date (provided that the amount of such cash proceeds utilized for any such repurchase, retirement, other acquisition or dividend will not increase the amount available for Restricted Payments under clause (c) of the immediately preceding paragraph); plus

(b) the cash proceeds of key man life insurance policies received by Holdings or any direct or indirect parent of Holdings (to the extent contributed to Holdings) and its Restricted Subsidiaries after the Issue Date

(provided that the Issuers may elect to apply all or any portion of the aggregate increase contemplated by clauses (a) and (b) above in any calendar year); in addition, cancellation of Indebtedness owing to the Issuers from any current or former officer, director or employee (or any permitted transferees thereof) of the Issuers or any of its Restricted Subsidiaries (or any direct or indirect parent company thereof), in connection with a repurchase of Equity Interests of the Issuers from such Persons will not be deemed to constitute a Restricted Payment for purposes of this covenant or any other provisions of the Indenture;

 

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(5) the declaration and payment of dividends or distributions to holders of any class or series of Disqualified Stock of Holdings or any of its Restricted Subsidiaries and any Preferred Stock of any Restricted Subsidiaries issued or Incurred in accordance with the covenant described under “—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”;

(6) the declaration and payment of dividends or distributions to holders of any class or series of Designated Preferred Stock (other than Disqualified Stock) issued after the Issue Date and the declaration and payment of dividends to Holdings or any direct or indirect parent of Holdings, the proceeds of which will be used to fund the payment of dividends to holders of any class or series of Designated Preferred Stock (other than Disqualified Stock) of Holdings or any direct or indirect parent of Holdings issued after the Issue Date; provided, however, that (A) for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date of issuance of such Designated Preferred Stock, after giving effect to such issuance (and the payment of dividends or distributions) on a pro forma basis, the Fixed Charge Coverage Ratio of Holdings and its Restricted Subsidiaries would have been at least 2.00 to 1.00 and (B) the aggregate amount of dividends declared and paid pursuant to this clause (6) does not exceed the net cash proceeds actually received by Holdings from any such sale of Designated Preferred Stock (other than Disqualified Stock) issued after the Issue Date;

(7) Investments in Unrestricted Subsidiaries having an aggregate Fair Market Value, taken together with all other Investments made pursuant to this clause (7) that are at that time outstanding, not to exceed $100.0 million (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value), at any one time outstanding;

(8) the payment of dividends on Holdings’ common stock (or the payment of dividends to any direct or indirect parent of Holdings to fund the payment by any direct or indirect parent of Holdings of dividends on such entity’s common stock) of up to 6.0% per annum of the net proceeds received by Holdings from any public offering of common stock or contributed to Holdings or any other direct or indirect parent of Holdings from any public offering of common stock;

(9) Restricted Payments that are made with Excluded Contributions;

(10) other Restricted Payments in an aggregate amount not to exceed $150.0 million at any one time outstanding;

(11) the distribution, as a dividend or otherwise, of shares of Capital Stock of, or Indebtedness owed to Holdings or a Restricted Subsidiary of Holdings by, Unrestricted Subsidiaries;

(12) the payment of any dividends or other distributions to any direct or indirect equity holder of Holdings, the Issuers or a Restricted Subsidiary in amounts required for such equity holder to pay U.S. federal, state, foreign or local income taxes (as the case may be) imposed directly on such equity holder to the extent such income taxes are attributable to the income of Holdings, the Issuers or such Restricted Subsidiary, as the case may be, by virtue of Holdings, the Issuers or Restricted Subsidiary being either a pass-through entity for tax purposes or a member of a consolidated or combined tax group of which Holdings, the Issuers or such Restricted Subsidiary is a member; provided, that in each case the amount of such payments in respect of any tax year does not exceed the amount that Holdings, the Issuers or Restricted Subsidiary, as the case may be, would have been required to pay in respect of U.S., federal, state, foreign or local taxes (as the case may be) for such year had Holdings, the Issuers or such Restricted Subsidiary paid such taxes as a stand alone taxpayer (or stand alone group) (reduced by any such taxes paid directly by Holdings, the Issuers or such Restricted Subsidiary);

(13) the payment of dividends, other distributions or other amounts to, or the making of loans to any direct or indirect parent, in the amount required for such entity to, if applicable:

(a) pay amounts equal to the amounts required for any direct or indirect parent of Holdings to pay fees and expenses (including franchise or similar taxes) required to maintain its corporate existence, customary salary, bonus and other benefits payable to, and indemnities provided on behalf of, officers and employees of Holdings or any direct or indirect parent of Holdings, if applicable, and general corporate operating and overhead expenses of any direct or indirect parent of Holdings, if applicable, in each case to the extent such fees, expenses, salaries, bonuses, benefits and indemnities are attributable to the ownership or operation of Holdings, if applicable, and its Subsidiaries; and

 

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(b) pay, if applicable, amounts equal to amounts required for any direct or indirect parent of Holdings, if applicable, to pay interest and/or principal on Indebtedness the proceeds of which have been contributed to Holdings or any of its Restricted Subsidiaries and that has been guaranteed by, or is otherwise considered Indebtedness of, Holdings or any of its Restricted Subsidiaries Incurred in accordance with the covenant described under “—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”;

(c) pay fees and expenses Incurred by any direct or indirect parent, other than to Affiliates of Holdings, related to any unsuccessful equity or debt offering of such parent; and

(d) payments to the Sponsor (a) pursuant to the Management Agreement or any amendment thereto (so long as such amendment is not less advantageous to the holders of the notes in any material respect than the Management Agreement) or (b) for any other financial advisory, financing, underwriting or placement services or in respect of other investment banking activities, including, without limitation, in connection with acquisitions or divestitures, in each case to the extent permitted under clauses (11) and (12) of the covenant “—Transactions with Affiliates”.

(14)(i) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price of such options or warrants and (ii) in connection with the withholding of a portion of the Equity Interests granted or awarded to a director or an employee to pay for the taxes payable by such director or employee upon such grant or award;

(15) purchases of receivables pursuant to a Receivables Repurchase Obligation in connection with a Qualified Receivables Financing and the payment or distribution of Receivables Fees;

(16) the payment, purchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Indebtedness, Disqualified Stock or Preferred Stock of Holdings and its Restricted Subsidiaries pursuant to provisions similar to those described under “—Change of Control” and “—Asset Sales”; provided that, prior to such payment, purchase, redemption, defeasance or other acquisition or retirement for value, the Issuers (or a third party to the extent permitted by the Indenture) have made a Change of Control Offer or Asset Sale Offer, as the case may be, with respect to the notes as a result of such Change of Control or Asset Sale, as the case may be, and has repurchased all notes validly tendered and not withdrawn in connection with such Change of Control Offer or Asset Sale Offer, as the case may be;

(17) any joint venture may make Restricted Payments required or permitted to be made pursuant to the terms of the joint venture arrangements to holders of its Equity Interests;

(18) any Restricted Payments made in connection with the consummation of the Transactions;

(19) Restricted Payments made after the Issue Date to repurchase or redeem any Existing Notes not tendered in connection with the Transactions;

(20) the payment of cash in lieu of the issuance of fractional shares of Equity Interests upon exercise or conversion of securities exercisable or convertible into Equity Interests of the Issuers;

(21) Holdings or any of its Restricted Subsidiaries may make Restricted Payments from funds held in the Loan Note Escrow Account to the holders of the Loan Notes in accordance with the terms of the Loan Notes Instrument; and

(22) payments or distributions, in the nature of satisfaction of dissenters’ rights, pursuant to or in connection with a consolidation, merger or transfer of assets that complies with the provisions of the Indenture applicable to mergers, consolidations and transfers of all or substantially all the property and assets of the Issuer;

provided, however, that at the time of, and after giving effect to, any Restricted Payment permitted under clauses (6), (7), (8), (10), (11) and (16), no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof.

Holdings will not permit any Unrestricted Subsidiary to become a Restricted Subsidiary except pursuant to the definition of “Unrestricted Subsidiary.” For purposes of designating any Restricted Subsidiary as an Unrestricted Subsidiary, all outstanding Investments by Holdings and its Restricted Subsidiaries (except to the extent repaid) in the Subsidiary so designated will be deemed to be Restricted Payments or Permitted Investments in an amount determined as set forth in the last sentence of the definition of “Investments.” Such designation will only be permitted if a Restricted Payment or Permitted Investment in such amount would be permitted at such time and if such Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.

 

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For purposes of the covenant described above, if any Investment or Restricted Payment would be permitted pursuant to one or more provisions described above and/or one or more of the exceptions contained in the definition of “Permitted Investments,” the Issuers may divide and classify such Investment or Restricted Payment in any manner that complies with this covenant and may later divide and reclassify any such Investment or Restricted Payment so long as the Investment or Restricted Payment (as so divided and/or reclassified) would be permitted to be made in reliance on the applicable exception as of the date of such reclassification.

Dividend and Other Payment Restrictions Affecting Subsidiaries. The Indenture will provide that Holdings will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or consensual restriction on the ability of any Restricted Subsidiary to:

(a)(i) pay dividends or make any other distributions to Holdings or any of its Restricted Subsidiaries (1) on its Capital Stock or (2) with respect to any other interest or participation in, or measured by, its profits; or (ii) pay any Indebtedness owed to Holdings or any of its Restricted Subsidiaries;

(b) make loans or advances to Holdings or any of its Restricted Subsidiaries; or

(c) sell, lease or transfer any of its properties or assets to Holdings or any of its Restricted Subsidiaries;

except in each case for such encumbrances or restrictions existing under or by reason of:

(1) contractual encumbrances or restrictions in effect or entered into or existing on the Issue Date, including pursuant to the Credit Agreement and the other documents relating to the Transactions;

(2) the Indenture, the notes and any exchange notes and guarantees thereof;

(3) applicable law or any applicable rule, regulation or order;

(4) any agreement or other instrument of a Person acquired by Holdings or any Restricted Subsidiary which was in existence at the time of such acquisition (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired;

(5) contracts or agreements for the sale of assets, including customary restrictions with respect to a Restricted Subsidiary imposed pursuant to an agreement entered into for the sale or disposition of all or substantially all the Capital Stock or assets of such Restricted Subsidiary;

(6) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business;

(7) customary provisions in joint venture, operating or other similar agreements, asset sale agreements and stock sale agreements in connection with the entering into of such transaction in the ordinary course of business;

(8) purchase money obligations for property acquired and Capitalized Lease Obligations in the ordinary course of business that impose restrictions of the nature discussed in clause (c) above on the property so acquired;

(9) customary provisions contained in leases, licenses, contracts and other similar agreements entered into in the ordinary course of business that impose restrictions of the type described in clause (c) above on the property subject to such lease;

(10) any encumbrance or restriction of a Receivables Subsidiary effected in connection with a Qualified Receivables Financing; provided, however, that such restrictions apply only to such Receivables Subsidiary;

(11) other Indebtedness, Disqualified Stock or Preferred Stock of any Restricted Subsidiary of Holdings that is Incurred subsequent to the Issue Date pursuant to the covenant described under “—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”; provided that such encumbrances and restrictions contained in any agreement or instrument will not materially affect the Issuers’ ability to make anticipated principal or interest payment on the notes (as determined by the Issuers in good faith);

(12) any Restricted Investment not prohibited by the covenant described under “—Limitation on Restricted Payments” and any Permitted Investment;

(13) arising or agreed to in the ordinary course of business, not relating to any Indebtedness, and that do not, individually or in the aggregate, detract from the value of property or assets of the Issuers or any Restricted Subsidiary thereof in any manner material to the Issuers or any Restricted Subsidiary thereof;

 

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(14) existing under, by reason of or with respect to Refinancing Indebtedness; provided that the encumbrances and restrictions contained in the agreements governing that Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced;

(15) contractual encumbrances or restrictions under the COLI Loans;

(16) restrictions contained in the Loan Notes Instrument; and

(17) any encumbrances or restrictions of the type referred to in clauses (a), (b) and (c) above imposed by any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in clauses (1) through (16) above; provided that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are, in the good faith judgment of the Issuer, no more restrictive as a whole with respect to such dividend and other payment restrictions than those contained in the dividend or other payment restrictions prior to such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing.

For purposes of determining compliance with this covenant (i) the priority of any Preferred Stock in receiving dividends or liquidating distributions prior to dividends or liquidating distributions being paid on common stock shall not be deemed a restriction on the ability to make distributions on Capital Stock and (ii) the subordination of loans or advances made to Holdings or a Restricted Subsidiary of Holdings to other Indebtedness Incurred by Holdings or any such Restricted Subsidiary shall not be deemed a restriction on the ability to make loans or advances.

Asset Sales. The Indenture will provide that Holdings will not, and will not permit any of the Restricted Subsidiaries to, cause or make an Asset Sale, unless:

(1) Holdings or any of its Restricted Subsidiaries, as the case may be, receives consideration at the time of such Asset Sale at least equal to the Fair Market Value (as determined in good faith by the Issuer) of the assets sold or otherwise disposed of; and

(2) except in the case of a Permitted Asset Swap, at least 75% of the consideration therefor received by Holdings or such Restricted Subsidiary, as the case may be, is in the form of Cash Equivalents; provided that the amount of:

(a) any liabilities (as shown on Holdings’ or such Restricted Subsidiary’s most recent balance sheet or in the notes thereto) of Holdings or any Restricted Subsidiary of Holdings (other than liabilities that are by their terms subordinated to the notes) that are assumed by the transferee of any such assets or Equity Interests pursuant to an agreement that releases or indemnifies Holdings or such Restricted Subsidiary, as the case may be, from further liability;

(b) any notes or other obligations or other securities or assets received by Holdings or such Restricted Subsidiary from such transferee that are converted by Holdings or such Restricted Subsidiary into cash within 180 days of the receipt thereof (to the extent of the cash received); and

(c) any Designated Non-cash Consideration received by Holdings or any of its Restricted Subsidiaries in such Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of (x) $100.0 million and (y) 2.0% of Total Assets, at the time of the receipt of such Designated Non-cash Consideration (with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value);

shall each be deemed to be Cash Equivalents for the purposes of this provision.

Within 365 days after Holdings’ or any Restricted Subsidiary’s receipt of the Net Cash Proceeds of any Asset Sale, Holdings or such Restricted Subsidiary may apply the Net Cash Proceeds from such Asset Sale, at its option:

(1) to repay Indebtedness constituting Senior Obligations (and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto),

(2) to repay Indebtedness constituting Second Lien Obligations (and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto) (provided that (x) to the extent that the terms of Second Lien Obligations other than the Second Lien Note Obligations and other than any capital markets debt securities require that such Second Lien Obligations are repaid with the Net Cash Proceeds of Asset Sales prior to repayment of other Indebtedness, the Issuers shall be entitled to repay such other Second Lien Obligations prior to repaying the Obligations under the notes and (y) subject to the foregoing clause (x), if the Issuers or any Note Guarantor shall so reduce Second Lien Obligations, the Issuers will equally and ratably reduce Obligations under the notes through

 

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open-market purchases (provided that such purchases are at or above 100% of the principal amount thereof) or by making an offer (in accordance with the procedures set forth below for an Asset Sale Offer) to all holders to purchase at a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, the pro rata principal amount of notes),

(3) to make an investment in any one or more businesses (provided that if such investment is in the form of the acquisition of Capital Stock of a Person, such acquisition results in such Person becoming a Restricted Subsidiary of Holdings), assets, or property or capital expenditures, in each case used or useful in a Similar Business,

(4) to make an investment in any one or more businesses (provided that if such investment is in the form of the acquisition of Capital Stock of a Person, such acquisition results in such Person becoming a Restricted Subsidiary of Holdings), properties or assets that replace the properties and assets that are the subject of such Asset Sale, or

(5) any combination of the foregoing.

provided that Holdings and its Restricted Subsidiaries will be deemed to have complied with the provisions described in clauses (3) and (4) of this paragraph if and to the extent that, within 365 days after the Asset Sale that generated the Net Cash Proceeds, the Issuers have entered into and not abandoned or rejected a binding agreement to acquire the assets or Capital Stock of a Similar Business, make an Investment in Replacement Assets or make a capital expenditure in compliance with the provision described in clauses (3) and (4) of this paragraph, and that acquisition, purchase or capital expenditure is thereafter completed within 180 days after the end of such 365-day period.

Pending the final application of any such Net Cash Proceeds, Holdings or such Restricted Subsidiary of the Issuers may temporarily reduce Indebtedness under a revolving credit facility, if any, or otherwise invest such Net Cash Proceeds in Cash Equivalents or Investment Grade Securities. Any Net Cash Proceeds from any Asset Sale that are not applied as provided and within the time period set forth in the two preceding paragraphs (it being understood that any portion of such Net Cash Proceeds used to make an offer to purchase notes, as described in clause (1) above, shall be deemed to have been invested whether or not such offer is accepted) will be deemed to constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $50.0 million, the Issuers shall make an offer to all holders of notes (and, at the option of the Issuers, to holders of any Second Lien Obligations) (an “Asset Sale Offer”) to purchase the maximum principal amount of notes (and such Second Lien Obligations), that is at least $2,000 and an integral multiple of $1,000 that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof (or, in the event such Second Lien Obligations were issued with significant original issue discount, 100% of the accreted value thereof), plus accrued and unpaid interest and additional interest, if any (or, in respect of such Second Lien Obligations, such lesser price, if any, as may be provided for by the terms of such Second Lien Obligations), to the date fixed for the closing of such offer, in accordance with the procedures set forth in the Indenture. The Issuers will commence an Asset Sale Offer with respect to Excess Proceeds within ten (10) Business Days after the date that Excess Proceeds exceeds $50.0 million by mailing the notice required pursuant to the terms of the Indenture, with a copy to the Trustee. To the extent that the aggregate amount of notes (and such Second Lien Obligations) tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Issuers may use any remaining Excess Proceeds for general corporate purposes. If the aggregate principal amount of notes (and such Second Lien Obligations) surrendered by holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the notes to be purchased in the manner described below. Upon completion of any such Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.

The Issuers will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations to the extent such laws or regulations are applicable in connection with the repurchase of the notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of the Indenture, the Issuers will comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations described in the Indenture by virtue thereof.

If more notes (and such Second Lien Obligations) are tendered pursuant to an Asset Sale Offer than the Issuers are required to purchase, selection of such notes for purchase will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which such notes are listed, or if such notes are not so listed, on a pro rata basis or by lot or such other method as the Trustee shall deem fair and appropriate (and in such manner as complies with applicable legal requirements); provided that no notes of $2,000 or less shall be purchased in part. Selection of such Second Lien Obligations will be made pursuant to the terms of such Second Lien Obligations.

Notices of an Asset Sale Offer shall be mailed by first class mail, postage prepaid, or sent electronically, at least 30 but not more than 60 days before the purchase date to each holder of notes at such holder’s registered address. If any note is to be purchased in part only, any notice of purchase that relates to such note shall state the portion of the principal amount thereof that has been or is to be purchased.

 

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Transactions with Affiliates. The Indenture will provide that Holdings will not, and will not permit any Restricted Subsidiaries of Holdings to, directly or indirectly, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction or series of transactions, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate of Holdings (each of the foregoing, an “Affiliate Transaction”) involving aggregate consideration in excess of $15.0 million, unless:

(a) such Affiliate Transaction is on terms that are not materially less favorable to Holdings or the relevant Restricted Subsidiary than those that could have been obtained in a comparable transaction by Holdings or such Restricted Subsidiary with an unrelated Person; and

(b) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $25.0 million, the Issuers deliver to the Trustee a resolution adopted in good faith by the majority of the Board of Directors of the Issuers or any other direct or indirect parent of the Company approving such Affiliate Transaction and set forth in an Officer’s Certificate certifying that such Affiliate Transaction complies with clause (a) above.

The foregoing provisions will not apply to the following:

(1)(a) transactions between or among Holdings and/or any of the Restricted Subsidiaries of Holdings (or an entity that becomes a Restricted Subsidiary as a result of such transaction) and (b) any merger or consolidation of Holdings or any direct parent company of Holdings, provided that such parent company shall have no material liabilities and no material assets other than cash, Cash Equivalents and the Capital Stock of Holdings and such merger or consolidation is otherwise in compliance with the terms of the Indenture and effected for a bona fide business purpose;

(2)(a) Restricted Payments permitted by the provisions of the Indenture described above under the covenant “—Limitation on Restricted Payments” and (b) Permitted Investments;

(3) the payment of reasonable and customary fees and reimbursements paid to, and indemnity and similar arrangements provided on behalf of, officers, directors, employees or consultants of Holdings or any Restricted Subsidiary or any direct or indirect parent of Holdings;

(4) transactions in which Holdings or any of the Restricted Subsidiaries, as the case may be, delivers to the Trustee a letter from an Independent Financial Advisor stating that such transaction is fair to Holdings or such Restricted Subsidiary from a financial point of view or meets the requirements of clause (a) of the preceding paragraph;

(5) payments or loans (or cancellation of loans, advances or guarantees) or advances to employees or consultants or guarantees in respect thereof for bona fide business purposes in the ordinary course of business;

(6) any agreement as in effect as of the Issue Date or any transaction contemplated thereby;

(7) the existence of, or the performance by Holdings or any of its Restricted Subsidiaries of its obligations under the terms of any stockholders or similar agreement (including any registration rights agreement or purchase agreement related thereto) to which it is a party as of the Issue Date, and any amendment thereto or similar transactions, agreements or arrangements which it may enter into thereafter; provided, however, that the existence of, or the performance by Holdings or any of its Restricted Subsidiaries of its obligations under, any future amendment to any such existing transaction, agreement or arrangement or under any similar transaction, agreement or arrangement entered into after the Issue Date shall only be permitted by this clause (7) to the extent that the terms of any such existing transaction, agreement or arrangement together with all amendments thereto, taken as a whole, or new transaction, agreement or arrangement are not otherwise more disadvantageous to the holders of the notes in any material respect than the original transaction, agreement or arrangement as in effect on the Issue Date;

(8)(a) transactions with customers, clients, suppliers or purchasers or sellers of goods or services, in each case in the ordinary course of business and otherwise in compliance with the terms of the Indenture, which are fair to Holdings and the Restricted Subsidiaries of Holdings in the reasonable determination of Holdings, and are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated party or (b) transactions with joint ventures or Unrestricted Subsidiaries entered into in the ordinary course of business;

(9) any transaction effected as part of a Qualified Receivables Financing;

(10) the sale or issuance of Equity Interests (other than Disqualified Stock) of Holdings;

 

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(11) the payment of annual management, consulting, monitoring and advisory fees to the Sponsor pursuant to the Management Agreement to the Sponsor in an aggregate amount in any fiscal year not to exceed $5.0 million, plus all out-of-pocket reasonable expenses Incurred by the Sponsor or any of its Affiliates in connection with the performance of management, consulting, monitoring, advisory or other services with respect to Holdings and its Restricted Subsidiaries;

(12) payments by Holdings or any of its Restricted Subsidiaries to the Sponsor made for any financial advisory, financing, underwriting or placement services or in respect of other investment banking activities, including, without limitation, in connection with acquisitions or divestitures, which payments are (x) made pursuant to agreements with the Sponsor as in effect on the Issue Date or (y) approved by a majority of the Board of Directors of Holdings or any direct or indirect parent of Holdings in good faith;

(13) any contribution to the capital of Holdings or any Restricted Subsidiary;

(14) transactions permitted by, and complying with, the provisions of the covenant described under “—Merger, Consolidation or Sale of All or Substantially All Assets”;

(15) transactions between Holdings or any of its Restricted Subsidiaries and any Person, a director of which is also a director of Holdings or any direct or indirect parent of Holdings; provided, however, that such director abstains from voting as a director of Holdings or such direct or indirect parent of Holdings, as the case may be, on any matter involving such other Person;

(16) pledges of Equity Interests of Unrestricted Subsidiaries;

(17) any employment agreements entered into by Holdings or any of its Restricted Subsidiaries in the ordinary course of business;

(18) the issuances of securities or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment arrangements, stock option and stock ownership plans or similar employee benefit plans approved by the Board of Directors of Holdings or any direct or indirect parent of Holdings or of a Restricted Subsidiary of Holdings, as appropriate, in good faith;

(19) the entering into of any tax sharing agreement or arrangement and any payments permitted by clause (12) of the second paragraph of the covenant described under “—Limitation on Restricted Payments”;

(20) transactions to effect the Transactions and the payment of all fees and expenses related to the Transactions;

(21) any employment, consulting, service or termination agreement, or customary indemnification arrangements, entered into by the Issuers or any of their Restricted Subsidiaries with current, former or future officers and employees of the Issuer, Holdings or any of their respective Restricted Subsidiaries and the payment of compensation to officers and employees of the Issuer, Holdings or any of their respective Restricted Subsidiaries (including amounts paid pursuant to employee benefit plans, employee stock option or similar plans), in each case in the ordinary course of business;

(22) transactions with a Person that is an Affiliate of the Issuers solely because the Issuers, directly or indirectly, own Equity Interests in, or control, such Person entered into in the ordinary course of business;

(23) transactions pursuant to any contracts, instruments or other agreements or arrangements in each case as in effect on the date of the Indenture, and any transactions contemplated thereby, or any amendment, modification or supplement thereto or any replacement thereof entered into from time to time, as long as such agreement or arrangement as so amended, modified, supplemented or replaced, taken as a whole, is not materially more disadvantageous to the Issuers and their Restricted Subsidiaries at the time executed than the original agreement or arrangement as in effect on the date of the Indenture; and

(24) transactions with Affiliates solely in their capacity as holders of Indebtedness or Equity Interests of the Issuers or any of their Subsidiaries, so long as such transaction is with all holders of such class (and there are such non-Affiliate holders) and such Affiliates are treated no more favorably than all other holders of such class generally; and

(25) transactions in which the Issuers or any of their Restricted Subsidiaries, as the case may be, deliver to the trustee a letter from an independent financial advisor stating that such transaction is fair to the Issuers or such Restricted Subsidiary from a financial point of view or meets the requirements of prong (a) of the previous paragraph of this covenant.

 

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Liens. The Indenture will provide that Holdings will not, and will not permit any of the Restricted Subsidiaries to, directly or indirectly, create, Incur or suffer to exist any Lien (other than Permitted Liens) on any asset or property of Holdings or such Restricted Subsidiary.

Reports and Other Information. The Indenture will provide that notwithstanding that Holdings may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting pursuant to rules and regulations promulgated by the SEC, Holdings will file with the SEC (and provide the Trustee and holders with copies thereof, without cost to each holder, within 15 days after it files them with the SEC),

(1) within 90 days after the end of each fiscal year (or such longer period as may be permitted by the SEC if Holdings were then subject to such SEC reporting requirements as a non-accelerated filer), the information included in annual reports on Form 10-K (or any successor or comparable form) containing the information required to be contained therein (or required in such successor or comparable form) including, without limitation, a management’s discussion and analysis of financial information,

(2) within 45 days after the end of each of the first three fiscal quarters of each fiscal year (or such longer period as may be permitted by the SEC if Holdings were then subject to such SEC reporting requirements as a non-accelerated filer), the information included in quarterly reports on Form 10-Q containing the information required to be contained therein (or any successor or comparable form) including, without limitation, a management’s discussion and analysis of financial information, and

(3) promptly from time to time after the occurrence of an event required to be therein reported (and in any event within the time period specified for filing current reports on Form 8-K by the SEC), such other reports on Form 8-K (of any successor or comparable form);

provided, however, that Holdings shall not be so obligated to file such reports with the SEC prior to the date that it files a registration statement with the SEC, or in the event that the SEC does not permit such filing, in which event Holdings will put such information on its website, in addition to providing such information to the Trustee and the holders, in each case within 15 days after the time Holdings would be required to file such information with the SEC if it were subject to Section 13 or 15(d) of the Exchange Act; provided, further, that until such time as Holdings is subject to Section 13 or 15(d) of the Exchange Act: such reports shall not be required to contain any exhibit, or comply with (i) Item 10(e) of Regulation S-K promulgated by the SEC, (ii) Section 302 or Section 404 of the Sarbanes-Oxley Act of 2002, or related Items 307 and 308 of Regulation S-K promulgated by the SEC; and (b) such reports shall not be required to contain the separate financial statements contemplated by Rule 3-09, Rule 3-10 or Rule 3-16 of Regulation S-X promulgated by the SEC. In addition, annual and quarterly reports provided pursuant to clauses (1) and (2) above shall include in footnote form, condensed consolidating financial information together with the with separate columns for: (i) Holdings; (ii) the Issuers; (iii) Note Guarantors (other than Holdings) on a combined basis; and (iv) any other Subsidiaries of Holdings on a combined basis; (v) consolidating adjustments; and (vi) the total consolidated amounts.

In addition, Holdings will make such information available to prospective investors upon request. In addition, Holdings have agreed that, for so long as any notes remain outstanding during any period when it is not subject to Section 13 or 15(d) of the Exchange Act, or otherwise permitted to furnish the SEC with certain information pursuant to Rule 12g3-2(b) of the Exchange Act, it will furnish to the holders of the notes and to prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

Notwithstanding the foregoing, Holdings will be deemed to have furnished such reports referred to above to the Trustee and the holders of the notes if Holdings have filed such reports with the SEC via the EDGAR filing system and such reports are publicly available. In addition, such requirements shall be deemed satisfied prior to the commencement of the exchange offer contemplated by the Registration Rights Agreement relating to the notes or the effectiveness of the shelf registration statement by the filing with the SEC of the exchange offer registration statement and/or shelf registration statement in accordance with the provisions of such Registration Rights Agreement, and any amendments thereto, if such registration statement and/or amendments thereto are filed at times that otherwise satisfy the time requirements set forth in the first paragraph of this covenant.

Holdings will also hold quarterly conference calls for the holders of the notes to discuss financial information for the previous quarter. The conference call will be following the last day of each fiscal quarter of Holdings and not later than ten Business Days from the time that Holdings distribute the financial information as set forth in clauses (1) or (2) above, as applicable. No fewer than two days prior to the conference call, Holdings shall post to their website the time and date of such conference call and providing instructions for holders, securities analysts and prospective investors to obtain access to such call.

In the event that any direct or indirect parent of Holdings is or becomes a Note Guarantor, the Indenture will permit Holdings to satisfy their obligations in this covenant with respect to financial information relating to Holdings by furnishing financial information relating to such direct or indirect parent.

 

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Future Guarantors. Subject to the requirements to provide certain guarantees within the 60 Day Post-Closing Period, the Indenture will provide that if Holdings acquires or creates any Restricted Subsidiary after the Issue Date (unless such Subsidiary is a Foreign Subsidiary that is not a guarantor under the Credit Agreement nor any capital markets debt of an Issuer or a Note Guarantor, a Receivables Subsidiary or is already a Note Guarantor) that guarantees any Indebtedness of Holdings, the Issuers or any other Note Guarantor, Holdings shall cause such Subsidiary, within 20 Business Days of the date that such Indebtedness has been guaranteed, to execute and deliver to the Trustee a supplemental indenture pursuant to which such Subsidiary will become a Note Guarantor under the Indenture governing the notes.

Each Note Guarantee will be limited to an amount not to exceed the maximum amount that can be guaranteed by that Restricted Subsidiary without rendering the Note Guarantee, as it relates to such Restricted Subsidiary, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally.

Each Note Guarantee shall be released in accordance with the provisions of the Indenture described under “—Note Guarantees.”

Merger, Consolidation or Sale of All or Substantially All Assets

The Indenture will provide that neither Issuer may consolidate or merge with or into or wind up into (whether or not such Issuer is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions, to any Person unless:

(1) such Issuer is the surviving corporation or the Person formed by or surviving any such consolidation or merger (if other than such Issuer) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a corporation, partnership or limited liability company organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof (the Issuer or such Person, as the case may be, being herein called the “Successor Company”) and, if such entity is not a corporation, a co-obligor of the notes is a corporation organized or existing under such laws;

(2) the Successor Company (if other than such Issuer) expressly assumes all the obligations of such Issuer under the Indenture, the notes and the Security Documents pursuant to supplemental indentures or other documents or instruments;

(3) immediately after giving effect to such transaction (and treating any Indebtedness that becomes an obligation of the Successor Company or any of its Restricted Subsidiaries as a result of such transaction as having been Incurred by the Successor Company or such Restricted Subsidiary at the time of such transaction) no Default or Event of Default shall have occurred and be continuing;

(4) immediately after giving pro forma effect to such transaction, as if such transaction had occurred at the beginning of the applicable four-quarter period, either

(a) the Successor Company would be permitted to Incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant described under “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock” or

(b) the Fixed Charge Coverage Ratio for the Successor Company and its Restricted Subsidiaries would be greater than such ratio for Holdings and its Restricted Subsidiaries immediately prior to such transaction;

(5) if the Successor Company is other than such Issuer, each Note Guarantor, unless it is the other party to the transactions described above, shall have by supplemental indenture confirmed that its Note Guarantee shall apply to such Person’s obligations under the Indenture and the notes; and

(6) the Issuers shall have delivered to the Trustee an Officer’s Certificate and an opinion of counsel stating that such consolidation, merger or transfer and such supplemental indentures (if any) comply with the Indenture.

 

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The Successor Company (if other than such Issuer) will succeed to, and be substituted for, the Issuer under the Indenture, the notes and the Security Documents, and in such event the Issuer will automatically be released and discharged from its obligations under the Indenture, the notes and the Security Documents. Notwithstanding the foregoing clauses (3) and (4), (a) an Issuer may consolidate with, merge into or sell, assign, transfer, lease, convey or otherwise dispose of all or part of its properties and assets to Holdings, the other Issuer or to any Restricted Subsidiary and (b) an Issuer may merge or consolidate with an Affiliate incorporated or organized solely for the purpose of reincorporating or reorganizing such Issuer in another state of the United States, the District of Columbia or any territory of the United States and (c) the Transactions may occur so long as the amount of Indebtedness of such Issuer and its Restricted Subsidiaries is not increased thereby (any transaction described in this sentence, a “Specified Merger/Transfer Transaction”).

The Indenture will further provide that subject to certain limitations in the Indenture governing release of a Note Guarantee upon the sale or disposition of Holdings or its Restricted Subsidiary (other than to an Issuer) that is a Note Guarantor, each Note Guarantor will not, and Holdings will not permit any Note Guarantor to, consolidate or merge with or into or wind up into (whether or not such Note Guarantor is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions to, any Person (herein called the “Successor Guarantor”) (other than the Transactions) unless:

(1) such sale or disposition or consolidation or merger is not in violation of the covenant described under “—Certain Covenants—Asset Sales”;

(2) immediately after giving effect to such transaction (and treating any Indebtedness that becomes an obligation of the Successor Guarantor or any of its Subsidiaries as a result of such transaction as having been Incurred by the Successor Guarantor or such Subsidiary at the time of such transaction) no Default or Event of Default shall have occurred and be continuing; and

(3) the Successor Guarantor (if other than such Note Guarantor) shall have delivered or caused to be delivered to the Trustee an Officer’s Certificate and an opinion of counsel stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with the Indenture.

Subject to certain limitations described in the Indenture, the Successor Guarantor will succeed to, and be substituted for, such Note Guarantor under the Indenture and such Note Guarantor’s Note Guarantee, and such Note Guarantor will automatically be released and discharged from its obligations under the Indenture and such Note Guarantor’s Note Guarantee. Notwithstanding the foregoing, (1) a Note Guarantor may merge or consolidate with an Affiliate incorporated or organized solely for the purpose of reincorporating or reorganizing such Note Guarantor in another state of the United States, the District of Columbia or any territory of the United States, so long as the amount of Indebtedness of the Note Guarantor is not increased thereby, (2) a Note Guarantor may merge or consolidate with another Note Guarantor or the Issuers and (3) a Note Guarantor may convert into a corporation, partnership, limited partnership, limited liability corporation or trust organized or existing under the laws of the jurisdiction of organization of such Note Guarantor.

Defaults

An Event of Default will be defined in the Indenture with respect to a series of notes as:

(1) a default in any payment of interest on any note of such series when the same becomes due and payable and such default continues for a period of 30 days,

(2) a default in the payment of principal or premium, if any, of any note when due at its Stated Maturity, upon optional redemption, upon required repurchase, upon declaration or otherwise,

(3) failure by Holdings or any of its Restricted Subsidiaries to comply with the provisions described under the captions “—Change of Control,” or “—Merger, Consolidation or Sale of All or Substantially All Assets” or the provisions described in the third paragraph under the caption “—Note Guarantees” for 30 days after written notice by the trustee or holders representing 25% or more of the aggregate principal amount of notes outstanding,

(4) the failure by Holdings or any of its Restricted Subsidiaries to comply for 60 days after written notice with its other agreements contained in the notes or the Indenture,

(5) the failure by Holdings or any Significant Subsidiary of Holdings to pay any Indebtedness (other than Indebtedness owing to Holdings or its Restricted Subsidiary) within any applicable grace period after final maturity or the acceleration of any such Indebtedness by the holders thereof because of a default, each case, if the total amount of such Indebtedness unpaid or accelerated exceeds $50.0 million or its foreign currency equivalent (the “cross acceleration provision”),

 

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(6) certain events of bankruptcy or insolvency of Holdings or a Significant Subsidiary of Holdings (the “bankruptcy provisions”),

(7) failure by Holdings or any Significant Subsidiary of Holdings to pay final and non-appealable judgments aggregating in excess of $50.0 million or its foreign currency equivalent (net of any amounts which are covered by enforceable insurance policies issued by solvent carriers), which judgments are not discharged, waived or stayed for a period of 60 days and, in the event, such judgment is covered by insurance, an enforcement proceeding has been commenced by any creditor upon such judgment or decree which is not promptly stayed (the “judgment default provision”),

(8) the Note Guarantee of a Significant Subsidiary of Holdings ceases to be in full force and effect in any material respect (except as contemplated by the terms thereof) or any such Note Guarantor denies or disaffirms its obligations under such Indenture or any Note Guarantee and such Default continues for 21 days after notice of such Default shall have been given to the Trustee,

(9) unless all of the Collateral has been released in accordance with the provisions of the Security Documents from the Liens granted thereunder, an Issuer shall assert or any Note Guarantor shall assert, in any pleading in any court of competent jurisdiction, that any such security interest is invalid or unenforceable and, in the case of any such Person that is a Subsidiary of Holdings, Holdings fails to cause such Subsidiary to rescind such assertions within 30 days after Holdings has actual knowledge of such assertions, or

(10) the failure by an Issuer or any Note Guarantor to comply for 60 days after written notice with its other agreements contained in the Security Documents except for a failure that would not be material to the holders of the notes and would not materially affect the value of the Collateral taken as a whole (together with the defaults described in clauses (9) and (10), the “security default provisions”).

The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.

However, a default under clause (3), (4) or (10) will not constitute an Event of Default until the Trustee or the holders of 25% of the aggregate principal amount of outstanding notes notify the Issuers of the default and the Issuers do not cure such default within the time specified in clause (3), (4) or (10) hereof after receipt of such notice.

If an Event of Default (other than a Default relating to certain events of bankruptcy, insolvency or reorganization of the Issuers) and is continuing, the Trustee or the holders of at least 25% of the aggregate principal amount of outstanding notes by notice to the Issuers may declare the principal of, premium, if any, and accrued but unpaid interest on all the notes to be due and payable. Upon such a declaration, such principal and interest will be due and payable immediately. If an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Issuers occur, the principal of, premium, if any, and interest on all the notes will become immediately due and payable without any declaration or other act on the part of the Trustee or any holders. Under certain circumstances, the holders of a majority in principal amount of outstanding notes may rescind any such acceleration with respect to the notes and its consequences.

In the event of any Event of Default specified in clause (5) of the first paragraph above, such Event of Default and all consequences thereof (excluding, however, any resulting payment default) will be annulled, waived and rescinded, automatically and without any action by the Trustee or the holders of the notes, if within 20 days after such Event of Default arose the Issuers deliver an Officer’s Certificate to the Trustee stating that (x) the Indebtedness or guarantee that is the basis for such Event of Default has been discharged or (y) the holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default or (z) the default that is the basis for such Event of Default has been cured, it being understood that in no event shall an acceleration of the principal amount of the notes as described above be annulled, waived or rescinded upon the happening of any such events.

Subject to the provisions of the Indenture relating to the duties of the Trustee, in case an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of any of the holders unless such holders have offered to the Trustee indemnity or security satisfactory to it against any loss, liability or expense. Except to enforce the right to receive payment of principal, premium (if any) or interest when due, no holder may pursue any remedy with respect to the Indenture or the notes unless:

(1) such holder has previously given the Trustee notice that an Event of Default is continuing,

(2) holders of at least 25% of the aggregate principal amount of the outstanding notes have requested the Trustee to pursue the remedy,

 

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(3) such holders have offered the Trustee security or indemnity reasonably satisfactory to it against any loss, liability or expense,

(4) the Trustee has not complied with such request within 60 days after the receipt of the request and the offer of security or indemnity, and

(5) the holders of a majority in principal amount of the outstanding notes have not given the Trustee a direction inconsistent with such request within such 60-day period.

Subject to certain restrictions, the holders of a majority in principal amount of outstanding notes are given the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. The Trustee, however, may refuse to follow any direction that conflicts with law or the Indenture or that the Trustee determines is unduly prejudicial to the rights of any other holder or that would involve the Trustee in personal liability. Prior to taking any action under the Indenture, the Trustee will be entitled to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.

Amendment, Supplement and Waiver

Subject to certain exceptions, the Indenture, the notes, the Note Guarantees, the Security Documents and the Second Lien Intercreditor Agreement may be amended or supplemented with the consent of the holders of at least a majority in aggregate principal amount of the notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, notes) and any existing or past default or compliance with any provisions of such documents may be waived with the consent of the holders of a majority in principal amount of the notes then outstanding (including, without limitation, consents obtained in connection with purchase of, or tender offer or exchange offer for, notes). However, without the consent of each holder of an outstanding note affected, no amendment may (with respect to any notes held by a non-consenting holder):

(1) reduce the percentage of the aggregate principal amount of notes whose holders must consent to an amendment,

(2) reduce the rate of or extend the time for payment of interest on any note,

(3) reduce the principal of or change the Stated Maturity of any note,

(4) reduce the premium payable upon the redemption of any note or change the time at which any note may be redeemed as described under “—Optional Redemption,”

(5) make any note payable in money other than that stated in such note,

(6) impair the right of any holder to receive payment of principal of, premium, if any, and interest on such holder’s notes on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such holder’s notes,

(7) make any change in the amendment provisions that require each holder’s consent or in the waiver provisions,

(8) expressly subordinate the notes or any Note Guarantee or otherwise modify the ranking thereof to any other Indebtedness of the Issuers or any Note Guarantor, or

(9) modify the Note Guarantees in any manner adverse to the holders.

Without the consent of the holders of at least two-thirds in aggregate principal amount of the notes then outstanding, no amendment or waiver (i) may release all or substantially all of the Collateral from the Lien of the Indenture and the Security Documents with respect to the notes or (ii) make any change in the provisions in the Second Lien Intercreditor Agreement or the Indenture dealing with the application of proceeds of Collateral that would adversely affect the holders of the notes.

Notwithstanding the foregoing, without the consent of any holder, the Issuers and Trustee may amend the Indenture, the note, the Note Guarantees, any Security Document or the Second Lien Intercreditor Agreement to cure any ambiguity, omission, mistake, defect or inconsistency, to provide for the assumption by a Successor Company of the obligations of the Issuer under the Indenture and the notes, to provide for the assumption by a Successor Note Guarantor of the obligations of a Note Guarantor under the Indenture and its Note Guarantee, to provide for uncertificated notes in addition to or in place of certificated notes (provided that the uncertificated notes are issued in registered form for purposes of Section 163(f) of the Code, or in a manner such that the uncertificated notes are described in Section 163(f)(2)(B) of the Code), to add or release a Note Guarantee with respect to the notes in accordance with the terms of the Indenture and to comply with the provisions described under “—Guarantees,” to add additional assets as Collateral, to release Collateral from the Lien pursuant to the Indenture, the Security Documents and the Second Lien Intercreditor Agreement when permitted or required by the Indenture, the Security Documents and the Second Lien Intercreditor

 

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Agreement, to modify the Security Documents and/or the Second Lien Intercreditor Agreement to secure additional extensions of credit and add additional secured creditors holding other Second Lien Obligations or junior lien Obligations of the Issuers or any Note Guarantor so long as such other Second Lien Obligations or junior lien Obligations are not prohibited by the provisions of the Credit Agreement, Indenture and any other relevant agreement to add to the covenants of Holdings for the benefit of the holders or to surrender any right or power conferred upon Holdings, to make any change that does not adversely affect the rights of any holder or that would provide any additional rights or benefits to the holders to comply with any requirement of the SEC in connection with the qualification of the Indenture under the TIA to effect any provision of the Indenture, to make certain changes to the Indenture to provide for the issuance of additional notes (and the grant of security for the benefit of the additional notes); conform the text of the Indenture, the notes, the Note Guarantees or any security document to any provision of this Description of Senior Secured Second Lien Notes to the extent that such provision in this Description of Senior Secured Second Lien Notes was intended to be a verbatim recitation of the Indenture, the notes, the Note Guarantees or any security document; evidence and provide for the acceptance of appointment by a successor trustee, provided that the successor trustee is otherwise qualified and eligible to act as such under the terms of the Indenture, or evidence and provide for a successor or replacement Second Lien Collateral Agent under the Indenture and Security Documents; make, complete or confirm any grant of Collateral permitted or required by the Indenture or any of the Security Documents or any release, termination or discharge of Collateral that becomes effective as set forth in the Indenture or any of the Security Documents; mortgage, pledge, hypothecate or grant a security interest in favor of the Second Lien Collateral Agent for the benefit of the Trustee and the holders of the notes as additional security for the payment and performance of the Issuer’s and any Note Guarantor’s obligations under the Indenture, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee or the Second Lien Collateral Agent in accordance with the terms of the Indenture or otherwise; provide for the succession of any parties to the Indenture and Security Documents (and other amendments that are administrative or ministerial in nature), including, the replacement of the Second Lien Collateral Agent under the Second Lien Intercreditor Agreement, in connection with any incurrence of additional secured obligations or an amendment, renewal, extension, substitution, refinancing, restructuring, replacement, supplementing or other modification from time to time of any agreement in accordance with the terms of the Indenture and the relevant security document; provide for a reduction in the minimum denominations of the notes; make any amendment to the provisions of the Indenture relating to the transfer and legending of notes as permitted by the Indenture, including, without limitation, to facilitate the issuance and administration of the notes, provided that compliance with the Indenture as so amended may not result in notes being transferred in violation of the Securities Act or any applicable securities laws; provide for the assumption by one or more successors of the obligations of any of the Note Guarantors under the Indenture and the Note Guarantees; or comply with the rules of any applicable securities depositary.

The consent of the holders of the notes is not necessary under the Indenture to approve the particular form of any proposed amendment. It is sufficient if such consent approves the substance of the proposed amendment.

No Personal Liability of Directors, Officers, Employees and Stockholders

No director, officer, employee, incorporator or holder of any equity interests in the Issuers or Holdings or any other direct or indirect parent or any Note Guarantor, as such, will have any liability for any obligations of the Issuers or the Note Guarantors under the notes, the Note Guarantees or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each holder of notes by accepting a note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the notes. The waiver may not be effective to waive liabilities under the federal securities laws.

Transfer and Exchange

A noteholder may transfer or exchange notes in accordance with the Indenture. Upon any transfer or exchange, the registrar and the Trustee may require a noteholder, among other things, to furnish appropriate endorsements and transfer documents and the Issuers may require a noteholder to pay any taxes required by law or permitted by the Indenture. The Issuers are not required to transfer or exchange any note selected for redemption or to transfer or exchange any note for a period of 15 days prior to a selection of notes to be redeemed or tendered and not withdrawn in connection with a Change of Control Offer or an Asset Sale Offer. The notes will be issued in registered form and the registered holder of a note will be treated as the owner of such note for all purposes.

Satisfaction and Discharge

The Indenture will be discharged and will cease to be of further effect as to all outstanding notes when:

(1) either (a) all the notes theretofore authenticated and delivered (except lost stolen or destroyed notes which have been replaced or paid and notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by an Issuer and thereafter repaid to an Issuer or discharged from such trust) have been delivered to the Trustee for cancellation or (b) all of the notes (i) have become due and payable, (ii) will become due and payable at their stated maturity within one year or (iii) if redeemable at the option of the Issuers, are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Issuers, and an Issuer or any Note Guarantor has irrevocably deposited or caused to be deposited with the Trustee funds in an amount sufficient to pay and discharge the entire Indebtedness on the notes not theretofore delivered to

 

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the Trustee for cancellation, for principal of, premium, if any, and interest on the notes to the date of deposit together with irrevocable instructions from the Issuers directing the Trustee to apply such funds to the payment thereof at maturity or redemption, as the case may be;

(2) the Issuers and/or the Note Guarantors have paid all other sums payable under the Indenture; and

(3) the Issuers have delivered to the Trustee an Officer’s Certificate and an opinion of counsel stating that all conditions precedent under the Indenture relating to the satisfaction and discharge of the Indenture have been complied with.

The Collateral will be released from the lien securing the notes, as provided in the Indenture and Security Documents upon a satisfaction and discharge in accordance with the provisions described above.

Defeasance

The Issuers at any time may terminate all their obligations and all obligations of the Note Guarantors under the notes and the Indenture (“legal defeasance”) and cure all then existing Events of Default, except for certain obligations, including those respecting the defeasance trust and obligations to register the transfer or exchange of the notes, to replace mutilated, destroyed, lost or stolen notes and to maintain a registrar and paying agent in respect of the notes. The Issuers at any time may terminate their obligations under certain covenants that are described in the Indenture, including the covenants described under “—Certain Covenants,” the operation of the cross acceleration provision, the bankruptcy provisions with respect to Significant Subsidiaries and the judgment default provision and the security default provisions described under “—Defaults” and the undertakings and covenants contained under “—Change of Control” and “—Merger, Consolidation or Sale of All or Substantially All Assets” (“covenant defeasance”). If the Issuers exercise their legal defeasance option or their covenant defeasance option, each Note Guarantor will be released from all of its obligations with respect to its Note Guarantee and the Security Documents.

The Issuers may exercise their legal defeasance option notwithstanding their prior exercise of their covenant defeasance option. If the Issuers exercise their legal defeasance option, payment of the notes may not be accelerated because of an Event of Default with respect thereto. If the Issuers exercise their covenant defeasance option, payment of the notes may not be accelerated because of an Event of Default specified in clause (3), (4), (5) (with respect to any Default by the Issuers or any of their Restricted Subsidiaries with any of its obligations under the covenants described under “—Certain Covenants”), (6), (7) (with respect only to Significant Subsidiaries), (8), (9) or (10) under “—Defaults”.

In order to exercise either defeasance option, the Issuers must irrevocably deposit in trust (the “defeasance trust”) with the Trustee money or U.S. Government Obligations for the payment of principal, premium (if any) and interest on the applicable issue of notes to redemption or maturity, as the case may be, and must comply with certain other conditions, including delivery to the Trustee of an opinion of counsel to the effect that holders of the notes will not recognize income, gain or loss for Federal income tax purposes as a result of such deposit and defeasance and will be subject to Federal income tax on the same amount and in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred (and, in the case of legal defeasance only, such opinion of counsel must be based on a ruling of the Internal Revenue Service or change in applicable Federal income tax law). Notwithstanding the foregoing, the opinion of counsel required by the immediately preceding sentence with respect to a legal defeasance need not be delivered if all notes not theretofore delivered to the Trustee for cancellation (x) have become due and payable or (y) will become due and payable at their Stated Maturity within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Issuers.

Concerning the Trustee

Wilmington Trust FSB is the Trustee under the Indenture and has been appointed by the Issuers as Registrar and a Paying Agent with regard to the notes.

Governing Law

The Indenture will provide that it and the notes will be governed by, and construed in accordance with, the laws of the State of New York.

Certain Definitions

“Acquired Indebtedness” means, with respect to any specified Person:

(1) Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Restricted Subsidiary of such specified Person whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Subsidiary of such specified Person, and

 

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(2) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

“Additional Second Lien Obligations” has the meaning given such term by the Second Lien Intercreditor Agreement.

“Additional Senior Obligations” has the meaning given such term by the Second Lien Intercreditor Agreement.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.

“Applicable Premium” means, with respect to any note on any applicable redemption date, the greater of:

(1) 1.0% of the then outstanding principal amount of the note; and

(2) the excess of

(a) the present value at such redemption date of (i) the redemption price of the note at October 1, 2014 (such redemption price being set forth in the applicable table appearing above under the caption “—Optional Redemption”) plus (ii) all required interest payments due on the note through October 1, 2014 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over

(b) the then outstanding principal amount of the note.

“Asset Sale” means:

(1) the sale, conveyance, transfer or other disposition (whether in a single transaction or a related transactions) of property or assets (including by way of a Sale/Leaseback Transaction) of Holdings or any Restricted Subsidiary of Holdings (each referred to in this definition as a “disposition”) or

(2) the issuance or sale of Equity Interests (other than directors’ qualifying shares or shares or interests required to be held by foreign nationals or other third parties to the extent required by applicable law) of any Restricted Subsidiary of Holdings (other than to Holdings or another Restricted Subsidiary of Holdings) (whether in a single transaction or a series of related transactions), in each case other than:

(a) a sale, exchange or other disposition of cash, Cash Equivalents or Investment Grade Securities or obsolete, damaged, unnecessary, unsuitable or worn out equipment in the ordinary course of business;

(b) the sale, conveyance or other disposition of all or substantially all of the assets of Holdings in a manner pursuant to the provisions described above under “—Merger, Consolidation or Sale of All or Substantially All Assets” or any disposition that constitutes a Change of Control;

(c) any Permitted Investment or Restricted Payment that is permitted to be made, and is made, under the covenant described above under “—Certain Covenants—Limitation on Restricted Payments”;

(d) any disposition of assets or issuance or sale of Equity Interests of any Restricted Subsidiary with an aggregate Fair Market Value of less than $15.0 million;

(e) any transfer or disposition of property or assets by a Restricted Subsidiary of Holdings to Holdings or by Holdings or a Restricted Subsidiary of Holdings to a Restricted Subsidiary of Holdings;

(f) sales of assets received by Holdings or any of its Restricted Subsidiary upon the foreclosure on a Lien;

(g) any issuance or sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;

(h) the sale, lease, assignment, license or sublease of inventory, equipment, accounts receivable or other current assets held for sale in the ordinary course of business including, without limitation, any collateral;

(i) the lease, assignment or sublease of any real or personal property in ordinary course of business;

 

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(j) a sale of accounts receivable and related assets of the type specified in the definition of “Receivables Financing” to a Receivables Subsidiary in a Qualified Receivables Financing or in factoring or similar transactions;

(k) a transfer of accounts receivable and related assets of the type specified in the definition of “Receivables Financing” (or a fractional undivided interest therein) by a Receivables Subsidiary in a Qualified Receivables Financing;

(l) any exchange of assets for assets (including a combination of assets and Cash Equivalents) related to a Similar Business of comparable or greater market value or usefulness to the business of Holdings and its Restricted Subsidiaries as a whole, as determined in good faith by the Issuer, which in the event of an exchange of assets with a Fair Market Value in excess of (1) $25.0 million shall be evidenced by an Officer’s Certificate, and (2) $50.0 million shall be set forth in a resolution approved in good faith by at least a majority of the Board of Directors of the Issuers;

(m) the grant in the ordinary course of business of any license or sub-license of patents, trademarks, know-how and any other intellectual property;

(n) any sale or other disposition deemed to occur with creating, granting or perfecting a Lien not otherwise prohibited by the Indenture or the note documents;

(o) the surrender or waiver or contract rights or settlement, release or surrender of a contract, tort or other litigation claim in the ordinary course of business;

(p) foreclosures, condemnations or any similar action on assets; and

(q) the sale (without recourse) of receivables (and related assets) pursuant to factoring arrangements entered into in the ordinary course of business.

“Board of Directors” means as to any Person, the board of directors or managers, sole member or managing member, as applicable, of such Person (or, if such Person is a partnership, the board of directors or other governing body of the general partner of such Person) or any duty authorized committee thereof.

“Business Day” means a day other than a Saturday, Sunday or other day on which banking institutions are authorized or required by law to close in New York City.

“Capital Stock” means:

(1) in the case of a corporation, corporate stock;

(2) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;

(3) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and

(4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

“Capitalized Lease Obligation” means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the footnotes thereto) in accordance with IFRS-EU.

“Cash Contribution Amount” means the aggregate amount of cash contributions made to the capital of the Issuer or any Note Guarantor described in the definition of “Contribution Indebtedness.”

“Cash Equivalents” means:

(1) U.S. dollars, pounds sterling, euros, the national currency of any participating member state of the European Union or, in the case of any Foreign Subsidiary that is a Restricted Subsidiary, such local currencies held by it from time to time in the ordinary course of business;

 

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(2) securities issued or directly and fully guaranteed or insured by the government of the United States or any country that is a member of the European Union or any agency or instrumentality thereof in each case with maturities not exceeding two years from the date of acquisition;

(3) certificates of deposit, time deposits and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers’ acceptances, in each case with maturities not exceeding one year, and overnight bank deposits, in each case with any commercial bank having capital and surplus in excess of $500 million, or the foreign currency equivalent thereof, and whose long-term debt is rated “A” or the equivalent thereof by Moody’s or S&P (or reasonably equivalent ratings of another internationally recognized ratings agency);

(4) repurchase obligations for underlying securities of the types described in clauses (2) and (3) above entered into with any financial institution meeting the qualifications specified in clause (3) above;

(5) commercial paper issued by a corporation (other than an Affiliate of Holdings) rated at least “A-1” or the equivalent thereof by Moody’s or S&P (or reasonably equivalent ratings of another internationally recognized ratings agency) and in each case maturing within one year after the date of acquisition;

(6) readily marketable direct obligations issued by any state of the United States of America or any political subdivision thereof having one of the two highest rating categories obtainable from either Moody’s or S&P (or reasonably equivalent ratings of another internationally recognized ratings agency) in each case with maturities not exceeding two years from the date of acquisition;

(7) Indebtedness issued by Persons (other than the Sponsor or any of its Affiliates) with a rating of “A” or higher from S&P or “A-2” or higher from Moody’s in each case with maturities not exceeding two years from the date of acquisition;

(8) investment funds investing at least 95% of their assets in securities of the types described in clauses (1) through (7) above; and

(9) instruments equivalent to those referred to in clauses (1) through (7) above denominated in Euro or pound sterling or any other foreign currency comparable in credit quality and tenor to those referred to above and customarily used by corporations for cash management purposes in any jurisdiction outside the United States to the extent reasonably required in connection with (a) any business conducted by any Restricted Subsidiary organized in such jurisdiction or (b) any Investment in the jurisdiction where such Investment is made.

“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time.

“COLI Loan” means those certain loans borrowed from time to time by The Gates Corporation against group life insurance policies from Mass Mutual (or any successor thereto) and the associated group life insurance policies.

“Collateral” has the meaning set forth in the Indenture and Collateral Documents.

“Consolidated Interest Expense” means, with respect to any Person and its Restricted Subsidiaries for any period, the sum, without duplication, of:

(1) interest expense of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, to the extent such expense was deducted in computing Consolidated Net Income (including amortization of original issue discount, the interest component of Capitalized Lease Obligations, and net payments and receipts (if any) pursuant to interest rate Hedging Obligations and excluding amortization of deferred financing fees and expensing of any bridge or other financing fees, the non-cash portion of interest expense resulting from the reduction in the carrying value under purchase accounting of the Issuer’s outstanding Indebtedness and commissions, discounts, yield and other fees and charges (including any interest but excluding the interest component associated with COLI Loans and any pension or other post-employment benefit expense) related to any Receivables Financing); and

(2) consolidated capitalized interest of such Person and its Restricted Subsidiaries for such period, whether paid or accrued;

less interest income for such period;

provided that, for purposes of calculating Consolidated Interest Expense, no effect shall be given to any interest expense associated with the Loan Notes, or interest income earned on amounts in the Loan Note Escrow Agreement, or the discount and/or premium resulting from the bifurcation of derivatives under FASB ASC 815 and related interpretations as a result of the terms of the Indebtedness to which such Consolidated Interest Expense relates.

 

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For purposes of this definition, interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by the Issuers to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with IFRS-EU.

“Consolidated Net Income” means, with respect to Holdings and its Restricted Subsidiaries for any period, the aggregate of the Net Income of Holdings and its Restricted Subsidiaries for such period, on a consolidated basis; provided, however, that:

(1) any net after-tax extraordinary, nonrecurring, non-operating or unusual gains or losses or income or expenses (including the effect of all fees and expenses relating thereto), including, without limitation, any expenses related to any reconstruction, any severance or relocation expenses and fees, any restructuring costs, any retention payments, any expenses or charges related to any Equity Offering, Permitted Investment, acquisition (including earn-out provisions) or Indebtedness permitted to be Incurred by the Indenture (in each case, whether or not successful) and any fees, expenses, charges or payments made under or contemplated by the Scheme or otherwise related to the Transactions, shall be excluded;

(2) the Net Income for such period shall not include the cumulative effect of a change in accounting principles during such period;

(3) any net after-tax income or loss from discontinued operations and any net after-tax gains or loss on disposal of discontinued operations shall be excluded;

(4) any net after-tax gains or losses (including the effect of all fees and expenses or charges relating thereto) attributable to business dispositions or asset dispositions other than in the ordinary course of business (as determined in good faith by the Issuers) shall be excluded;

(5) any net after-tax gains or losses (including the effect of all fees and expenses or charges relating thereto) attributable to the early extinguishment of Indebtedness shall be excluded;

(6) the Net Income for such period of any Person that is not a Subsidiary of such Person, or is an Unrestricted Subsidiary, or that is accounted for by the equity method of accounting (other than a Note Guarantor), shall be included only to the extent of the amount of dividends or distributions or other payments paid in cash (or to the extent converted into cash) to Holdings or a Restricted Subsidiary thereof in respect of such period;

(7) solely for the purpose of determining the amount available for Restricted Payments under clause (c)(1) of the first paragraph of “—Certain Covenants—Limitation on Restricted Payments,” the Net Income for such period of any Restricted Subsidiary (other than any Note Guarantor) shall be excluded to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary of its Net Income is not at the date of determination permitted without any prior governmental approval (which has not been obtained) or, directly or indirectly, by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders, unless such restrictions with respect to the payment of dividends or similar distributions have been legally waived; provided that (x) the net loss of any such Restricted Subsidiary shall be included therein and (y) the Consolidated Net Income of Holdings shall be increased by the amount of dividends or other distributions or other payments actually paid in cash (or converted into cash) by any such Restricted Subsidiary to Holdings, to the extent not already included therein;

(8) an amount equal to the amount of tax distributions actually made to the holders of Capital Stock of such Person or any parent company of such Person in respect of such period in accordance with clause (12) of the second paragraph under “—Certain Covenants—Limitation on Restricted Payments” shall be included as though such amounts had been paid as income taxes directly by such Person for such period;

(9) any non-cash impairment charges, goodwill write-off or asset write-off resulting from the application of IFRS-EU, and the amortization of intangibles arising under IFRS-EU, shall be excluded;

(10) any non-cash compensation expense realized from employee benefit plans or other post-employment benefit plans, grants of stock appreciation or similar rights, stock options or other rights to officers, directors and employees of such Person or any of its Restricted Subsidiaries shall be excluded;

(11)(a) (i) the non-cash portion of “straight-line” rent expense shall be excluded and (ii) the cash portion of “straight-line” rent expense that exceeds the amount expensed in respect of such rent expense shall be included and (b) non-cash gains, losses, income and expenses resulting from fair value accounting required by IFRS-EU shall be excluded;

(12) unrealized gains and losses relating to hedging transactions and mark-to-market of Indebtedness resulting from the application of IFRS-EU shall be excluded;

 

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(13) any (a) severance or relocation costs or expenses, (b) one-time non-cash compensation charges, (c) the costs and expenses after the Issue Date related to employment of terminated employees, or (d) costs or expenses realized in connection with or resulting from stock appreciation or similar rights, stock options or other rights existing on the Issue Date of officers, directors and employees, in each case of Holdings or any of its Restricted Subsidiaries, shall be excluded;

(14) effects of purchase accounting adjustments (including the effects of such adjustments pushed down to Holdings and its Restricted Subsidiaries) in amounts required or permitted by IFRS-EU (including in the inventory, property and equipment, software, goodwill, intangible assets, in-process research and development, post-employment benefits, deferred revenue and debt line items thereof) and related authoritative pronouncements (including the effects of such adjustments pushed down to Holdings and the Restricted Subsidiaries), resulting from the application of purchase accounting in relation to the Transactions or any consummated acquisition or the amortization or write-off of any amounts thereof shall be excluded;

(15) accruals and reserves, contingent liabilities, and any gains and losses on the settlement of any pre-existing contractual or non-contractual relationships as a result of the Transactions that are established or adjusted within 12 months after the Issue Date and that are so required to be established or adjusted in accordance with IFRS-EU or as a result of adoption or modification of accounting policies shall be excluded; and

(16) solely for purposes of calculating EBITDA, the Net Income of Holdings and its Restricted Subsidiaries shall be calculated without deducting the income attributable to, or adding the losses attributable to, the minority equity interests of third parties in any non-Wholly Owned Restricted Subsidiary except to the extent of dividends declared or paid in respect of such period or any prior period on the shares of Capital Stock of such Restricted Subsidiary held by such third parties shall be included.

Notwithstanding the foregoing, for the purpose of the covenant described under “—Certain Covenants—Limitation on Restricted Payments” only, there shall be excluded from Consolidated Net Income any dividends, repayments of loans or advances or other transfers of assets from Unrestricted Subsidiaries of Holdings or a Restricted Subsidiary of Holdings to the extent such dividends, repayments or transfers increase the amount of Restricted Payments permitted under such covenant pursuant to clauses (c)(5) and (6) of the first paragraph thereof.

“Consolidated Non-cash Charges” means, with respect to Holdings and its Restricted Subsidiaries for any period, the aggregate depreciation, amortization (including amortization of intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period), impairment, compensation, rent and other non-cash expenses of such Person and its Restricted Subsidiaries reducing Consolidated Net Income of such Person for such period on a consolidated basis and otherwise determined in accordance with IFRS-EU; provided that if any non-cash charges referred to in this definition represent an accrual or reserve for potential cash items in any future period, the cash payment in respect thereof in such future period shall be subtracted from EBITDA in such future period to such extent paid.

“Consolidated Senior Secured Debt Ratio” as of any date of determination means the ratio of (1) (x) Consolidated Total Indebtedness of Holdings and its Restricted Subsidiaries that is secured by a Lien minus (y) the aggregate amount of cash and Cash Equivalents (which shall be free and clear of any Liens) of Holdings and its Restricted Subsidiaries determined on a consolidated basis as reflected on the balance sheet in accordance with IFRS-EU, in each case of clause (x) and (y) as of the most recent fiscal period for which internal financial statements are available immediately preceding the date on which such event for which such calculation is being made shall occur to (2) the EBITDA of Holdings and its Restricted Subsidiaries for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such event for which such calculation is being made shall occur, in each case, with such pro forma adjustments to Consolidated Total Indebtedness and EBITDA as are appropriate and consistent with the pro forma adjustment provisions set forth in the definition of “Fixed Charge Coverage Ratio” (except that, for purposes of determining the amount of Consolidated Total Indebtedness pursuant to clause (1) of this definition, the amount of revolving Indebtedness under the Credit Agreement and any other revolving credit facility shall be computed based upon the period-ending value of such Indebtedness during the applicable period).

 

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“Consolidated Taxes” means, with respect to Holdings and its Restricted Subsidiaries any Person and its Restricted Subsidiaries on a consolidated basis for any period, provision for taxes based on income, profits or capital, including, without limitation, state franchise and similar taxes, and including an amount equal to the amount of tax distributions actually made to the holders of Capital Stock of such Person or any direct or indirect parent of such Person in respect of such period in accordance with clause (12) of the second paragraph under “—Certain Covenants—Limitation on Restricted Payments,” which shall be included as though such amounts had been paid as income taxes directly by such Person.

“Consolidated Total Indebtedness” means, as of any date of determination, the aggregate principal amount of Indebtedness of Holdings and its Restricted Subsidiaries outstanding on such date, determined on a consolidated basis, to the extent required to be recorded on a balance sheet in accordance with IFRS-EU, consisting of Indebtedness for borrowed money, Capitalized Lease Obligations and debt obligations evidenced by promissory notes or similar instruments.

“Contingent Obligations” means, with respect to any Person, any obligation of such Person guaranteeing any leases, dividends or other obligations that do not constitute Indebtedness (“primary obligations”) of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent:

(1) to purchase any such primary obligation or any property constituting direct or indirect security therefor,

(2) to advance or supply funds:

(a) for the purchase or payment of any such primary obligation; or

(b) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; or

(3) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.

“Contribution Indebtedness” means Indebtedness of the Issuers or any Note Guarantor in an aggregate principal amount not greater than the aggregate amount of cash contributions (other than Excluded Contributions) made to the capital of Holdings after the Issue Date, provided that:

(1) such Contribution Indebtedness shall be Indebtedness with a Stated Maturity later than the Stated Maturity of the notes, and

(2) such Contribution Indebtedness (a) is Incurred within 210 days after the making of such cash contributions and (b) is so designated as Contribution Indebtedness pursuant to an Officer’s Certificate on the Incurrence date thereof.

“Credit Agreement” means (i) the credit agreement entered into on July 27, 2010, among the Issuers, Holdings, certain Subsidiaries of Holdings, the financial institutions named therein and Citibank, N.A., as Administrative Agent, Banc of America Securities LLC, as syndication agent, as amended and restated on August 6, 2010, as further amended, restated, supplemented, waived, replaced (whether or not upon termination, and whether with the original lenders or otherwise), restructured, repaid, refunded, refinanced or otherwise modified from time to time, including any agreement or indenture extending the maturity thereof, refinancing, replacing or otherwise restructuring all or any portion of the Indebtedness under such agreement or agreements or indenture or indentures or any successor or replacement agreement or agreements or indenture or indentures or increasing the amount loaned or issued thereunder or altering the maturity thereof, and (ii) whether or not the credit agreement referred to in clause (i) remains outstanding, if designated by the Company to be included in the definition of “Credit Agreement,” one or more (A) debt facilities, indentures or commercial paper facilities providing for revolving credit loans, term loans, notes, debentures, receivables financing (including through the sale of receivables to lenders or to special purpose entities formed to borrow from lenders against such receivables) or letters of credit (B) debt securities, indentures or other forms of debt financing (including convertible or exchangeable debt instruments or bank guarantees or bankers’ acceptances), or (C) instruments or agreements evidencing any other Indebtedness, in each case, with the same or different borrowers or issuers and, in each case, as amended, supplemented, modified, extended, restructured, renewed, refinanced, restated, increased, replaced or refunded in whole or in part from time to time.

“Credit Agreement Collateral Agent” means Citibank N.A., in its capacity as collateral agent for the lenders and other secured parties under the Credit Agreement, together with its successors and permitted assigns under the Credit Agreement.

“Credit Agreement Indebtedness” means any Indebtedness under a Credit Agreement that is secured by a Permitted Lien incurred or deemed incurred pursuant to clause (6) of the definition of Permitted Liens with respect to Indebtedness incurred pursuant to clause (a) of the second paragraph of the covenant described under “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock.”

 

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“Default” means any event which is, or after notice or passage of time or would be, an Event of Default.

“Designated Non-cash Consideration” means the Fair Market Value of non-cash consideration received by the Issuers or one of their Restricted Subsidiaries in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such valuation, less the amount of Cash Equivalents received in connection with a subsequent sale of or collection on such Designated Non-cash Consideration.

“Designated Preferred Stock” means Preferred Stock of Holdings or any direct or indirect parent of Holdings, as applicable (other than Disqualified Stock), that is issued for cash (other than to Holdings or any of the Subsidiaries or an employee stock ownership plan or trust established by Holdings or any of the Subsidiaries) and is so designated as Designated Preferred Stock, pursuant to an Officer’s Certificate, on the issuance date thereof, the cash proceeds of which are excluded from the calculation set forth in clause (c) of the first paragraph of the covenant described under “—Certain Covenants—Limitation on Restricted Payments.”

“Discharge” means, with respect to any Obligations, the payment in full and discharge of all such Obligations and the termination of any commitments or other obligations to extend additional credit. The term “Discharged” shall have a corresponding meaning.

“Disqualified Stock” means any Capital Stock of such Person that, by its terms (or by the terms of any security into which it is convertible or for which it is redeemable or exchangeable, in each case at the option of the holder thereof), or upon the happening of any event:

(1) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise (other than as a result of a change of control or asset sale; provided that the relevant asset sale or change of control provisions, taken as a whole, are no more favorable in any material respect to holders of such Capital Stock than the asset sale and change of control provisions applicable to the notes and any purchase requirement triggered thereby may not become operative until compliance with the asset sale and change of control provisions applicable to the notes (including the purchase of any notes tendered pursuant thereto)),

(2) is convertible or exchangeable for Indebtedness or Disqualified Stock, or

(3) is redeemable at the option of the holder thereof, in whole or in part,

in each case prior to 91 days after the maturity date of the notes; provided, however, that only the portion of Capital Stock that so matures or is mandatorily redeemable, is so convertible or exchangeable or is so redeemable at the option of the holder thereof prior to such date shall be deemed to be Disqualified Stock; provided, further, however, that if such Capital Stock is issued to any employee or to any plan for the benefit of employees of Holdings or the Subsidiaries or by any such plan to such employees, such Capital Stock shall not constitute Disqualified Stock solely because it may be required to be repurchased by the Issuers in order to satisfy applicable statutory or regulatory obligations or as a result of such employee’s termination, death or disability; provided, further, that any class of Capital Stock of such Person that by its terms authorizes such Person to satisfy its obligations thereunder by delivery of Capital Stock that is not Disqualified Stock shall not be deemed to be Disqualified Stock.

“EBITDA” means, with respect to Holdings and its Restricted Subsidiaries for any period, the Consolidated Net Income of Holdings and its Restricted Subsidiaries for such period plus, without duplication, to the extent the same was deducted in calculating Consolidated Net Income:

(1) Consolidated Taxes; plus

(2) Consolidated Interest Expense; plus

(3) Consolidated Non-cash Charges; plus

(4) the amount of management, monitoring, consulting and advisory fees and related expenses paid to the Sponsor (or any accruals relating to such fees and related expenses) during such period to the extent otherwise permitted by the covenant described under “—Certain Covenants—Transactions with Affiliates”; plus

(5) any expenses or charges (other than Consolidated Non-cash Charges) related to any issuance of Equity Interests, Investment, acquisition, disposition, recapitalization or the Incurrence or repayment of Indebtedness permitted to be Incurred by the Indenture (including a refinancing thereof) (whether or not successful), including (i) such fees, expenses or charges related to the offering and/or issuance of the notes, (ii) any amendment or other modification of the notes or other Indebtedness, (iii) any additional interest in respect of the notes and (iv) commissions, discounts, yield and other fees and charges (including any interest expense) related to any Qualified Receivables Financing; plus

(6) the amount of loss on sale of receivables and related assets to a Receivables Subsidiary in connection with a Qualified Receivables Financing; plus

 

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(7) any costs or expense Incurred pursuant to any management equity plan or stock option plan or other management or employee benefit plan or agreement or any stock subscription or shareholder agreement, to the extent that such costs or expenses are funded with cash proceeds contributed to the capital of the Issuers or a Note Guarantor or the net cash proceeds of an issuance of Equity Interests of Holdings (other than Disqualified Stock) solely to the extent that such net cash proceeds are excluded from the calculation of the amount available for Restricted Payments under clause (c)(1) of the first paragraph of “—Certain Covenants—Limitation on Restricted Payments”; plus

(8) any ordinary course dividend, distributions or other payment paid in cash and received from any Person in excess of amounts included in clause (7) pursuant to the definition of “Consolidated Net Income”; plus/minus

(9) gains or losses due solely to fluctuations in currency values and the related tax effects; plus/minus

(10) gains or losses due to the net after-tax effect of clause (1), (3) and (4) in the definition “Consolidated Net Income” in calculating Consolidated Net Income;

less, without duplication, non-cash items increasing Consolidated Net Income for such period (excluding any items that represent the reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period).

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).

“Equity Offering” means any public or private sale after the Issue Date of common stock or Preferred Stock of Holdings or any direct or indirect parent of the Issuers, as applicable (other than Disqualified Stock), other than:

(1) public offerings with respect to such Person’s common stock registered on Form S-8;

(2) issuance to any Restricted Subsidiary of Holdings; and

(3) any such public or private sale that constitutes an Excluded Contribution.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Excluded Contributions” means the net cash proceeds and Cash Equivalents received by or contributed to the Issuers or the Note Guarantors after the Issue Date from:

(1) contributions to its common or preferred equity capital, and

(2) the sale (other than to Holdings or a Restricted Subsidiary or management equity plan or stock option plan or any other management or employee benefit plan or agreement) of Capital Stock (other than Disqualified Stock and Designated Preferred Stock) of Holdings or any direct or indirect parent,

in each case designated as Excluded Contributions pursuant to an Officer’s Certificate executed by an Officer of the Issuers, the proceeds of which are excluded from the calculation set forth in clause (c) of the first paragraph of “—Certain Covenants—Limitation on Restricted Payments.”

“Existing Notes” means the Medium Term Notes to the extent outstanding on the Issue Date.

“Fair Market Value” means, with respect to any asset or property, the price which could be negotiated in an arm’s length, free market transaction, for cash, between a willing seller and a willing and able buyer, neither of whom is under undue pressure or compulsion to complete the transaction (as determined in good faith by the Issuers or Holdings.

“Fixed Charge Coverage Ratio” means, with respect to Holdings and its Restricted Subsidiaries for any period, the ratio of EBITDA of Holdings and its Restricted Subsidiaries for such period to the Fixed Charges of Holdings and its Restricted Subsidiaries for such period. In the event that Holdings or any of its Restricted Subsidiaries Incurs or redeems any Indebtedness (other than in the case of revolving credit borrowings or revolving advances under any Qualified Receivables Financing, in which case interest expense shall be computed based upon the average daily balance of such Indebtedness during the applicable period) or issues or redeems Preferred Stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to the event for which the calculation of the Fixed Charge Coverage Ratio is made (the “Calculation Date”), then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such Incurrence or redemption of Indebtedness, or such issuance or redemption of Preferred Stock, as if the same had occurred at the beginning of the applicable four-quarter period.

For purposes of making the computation referred to above, Investments, acquisitions, dispositions, mergers (including the Transactions), consolidations and discontinued operations (as determined in accordance with IFRS-EU), in each case with respect to an operating unit of a business, and operational changes, that Holdings or any of its Restricted Subsidiaries has both determined to make and made after the Issue Date and during the four-quarter reference period or subsequent to such reference period and on or

 

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prior to or simultaneously with the Calculation Date (each, for purposes of this definition, a “pro forma event”) shall be calculated on a pro forma basis assuming that all such Investments, acquisitions, dispositions, mergers (including the Transactions), consolidations, discontinued operations and operational changes (and the change of any associated fixed charge obligations and the change in EBITDA resulting therefrom) had occurred on the first day of the four-quarter reference period. If since the beginning of such period any Person that subsequently became Holdings or Restricted Subsidiary or was merged with or into Holdings or any Restricted Subsidiary since the beginning of such period shall have made or effected any Investment, acquisition, disposition, merger, consolidation or discontinued operation, in each case with respect to an operating unit of a business, or operational change that would have required adjustment pursuant to this definition, then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Investment, acquisition, disposition, merger, consolidation, discontinued operation, or operational change had occurred at the beginning of the applicable four-quarter period.

For purposes of this definition, whenever pro forma effect is to be given to any pro forma event, the pro forma calculations shall be made in good faith by a responsible financial or accounting officer of the Issuers to the extent consistent with Regulation S-X or are otherwise reasonably identifiable and factually supportable, including the amount of cost savings and operating expense reductions for which specified actions are taken or committed to be taken within 12 months after the closing date of such pro forma event and have been realized or are expected to be realized within 12 months after the closing date of such pro forma event (calculated on a pro forma basis as though such cost savings and operating expense reductions had been realized on the first day of such period as if such cost savings and operating expense reductions were realized during the entirety of such period) relating to such pro forma event, net of the amount of actual benefits realized during such period from such actions; provided that (A) a duly completed certificate signed by the chief financial officer of the Issuers shall be delivered to the Trustee certifying that and setting forth in detail (x) such cost savings and operating expense reductions are reasonably expected and factually supportable in the good faith judgment of the Issuers, (y) such actions are to be taken within 12 months after the consummation of the acquisition, disposition, restructuring or the implementation of an initiative, which is expected to result in such cost savings and expense reductions, (B) no cost savings or operating expense reductions shall be added pursuant to this defined term to the extent duplicative of any expenses or charges otherwise added to EBITDA, whether through a pro forma adjustment or otherwise, for such period, (C) the aggregate amount of cost savings and operating expense reductions added pursuant to this definition in any period of four consecutive fiscal quarters shall not exceed (1) with respect to any individual acquisition or disposition, 10% of the EBITDA attributable to such acquired or disposed entity or assets for such period of four consecutive fiscal quarters and (2) for all other initiatives that do not result from acquisitions or dispositions, 10% of EBITDA (prior to giving effect to this definition) in the aggregate for any period of four consecutive fiscal quarters and (D) projected amounts (and not yet realized) may no longer be added in calculating EBITDA pursuant to this definition to the extent occurring more than four full fiscal quarters after the specified action taken in order to realize such projected cost savings and operating expense reductions.

If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedging Obligations applicable to such Indebtedness if such Hedging Obligation has a remaining term in excess of 12 months). Interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a responsible financial or accounting officer of the Issuers to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with IFRS-EU. For purposes of making the computation referred to above, interest on any Indebtedness under a revolving credit facility computed on a pro forma basis shall be computed based upon the average daily balance of such Indebtedness during the applicable period. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rate, shall be deemed to have been based upon the rate actually chosen, or, if none, then based upon such optional rate chosen as the Issuers may designate.

“Fixed Charges” means, with respect to any Person for any period, the sum of:

(1) Consolidated Interest Expense of such Person for such period, and

(2) all cash dividend payments (excluding items eliminated in consolidation) on any series of Preferred Stock or Disqualified Stock of such Person and its Restricted Subsidiaries.

“Foreign Subsidiary” means a Restricted Subsidiary not organized or existing under the laws of the United States of America or any state or territory or the District of Columbia thereof or any direct or indirect Subsidiary of such Restricted Subsidiary.

“guarantee” means, as to any Person, a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including, without limitation, letters of credit and reimbursement agreements in respect thereof), of all or any part of any Indebtedness of another Person.

“Hedging Obligations” means, with respect to any Person, the obligations of such Person under:

(1) currency exchange, interest rate or commodity Swap Agreements, currency exchange, interest rate or commodity cap agreements and currency exchange, interest rate or commodity collar agreements; and

 

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(2) other agreements or arrangements designed to protect such Person against fluctuations in currency exchange, interest rates or commodity prices.

“holder” or “noteholder” means the Person in whose name a note is registered on the Registrar’s books.

“Holdings” means Pinafore Holdings B.V. and its successors.

“IFRS-EU” means International Financial Reporting Standards as endorsed by the European Union, as in effect from time to time; provided, however, that if Holdings notifies the Trustee that Holdings (i) has elected to report under generally accepted accounting principles in, initially, the United States of America, as in effect from time to time (“GAAP”), “IFRS-EU” shall mean generally accepted accounting principles pursuant to GAAP (provided that after such election, Holdings cannot elect to report under International Financial Reporting Standards) or (ii) requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Issue Date in IFRS-EU or in the application thereof on the operation of such provision (or if the Trustee notifies Holdings that the holders of a majority of the principal amount of the notes outstanding request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in IFRS-EU or in the application thereof, then such provision shall be interpreted on the basis of IFRS-EU as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith and the Trustee, the holders and Holdings shall negotiate in good faith to amend such provision to preserve the original intent thereof in light of such change in IFRS-EU (subject to the approval of the holders of a majority of the principal amount of the notes); provided, further, that if reasonably requested by the Trustee, Holdings shall provide to the Trustee and the holders financial statements and other documents setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such conversion to GAAP or change in IFRS-EU.

“Incur” means, with respect to any Indebtedness, issue, assume, guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness or Capital Stock of a Person existing at the time such person becomes a Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a Subsidiary.

“Indebtedness” means, with respect to any Person:

(1) the principal and premium (if any) of any Indebtedness of such Person, whether or not contingent, (a) in respect of borrowed money, (b) evidenced by bonds, notes, debentures or similar instruments or letters of credit or bankers’ acceptances (or, reimbursement agreements in respect thereof), (c) representing the deferred and unpaid purchase price of any property, except (i) any such balance that constitutes a trade payable, accrued expense or similar obligation to a trade creditor and (ii) any earn-out obligations until such obligation becomes a liability on the balance sheet of such Person in accordance with IFRS-EU, (d) in respect of Capitalized Lease Obligations, or (e) representing any Hedging Obligations, other than Hedging Obligations that are incurred in the normal course of business and not for speculative purposes, and that do not increase the Indebtedness of the obligor outstanding at any time other than as a result of fluctuations in interest rates, commodity prices or foreign currency exchange rates or by reason of fees, indemnities and compensation payable thereunder, if and to the extent that any of the foregoing Indebtedness (other than letters of credit and Hedging Obligations) would appear as a liability on a balance sheet (excluding the footnotes thereto) of such Person prepared in accordance with IFRS-EU;

(2) to the extent not otherwise included, any obligation of such Person to be liable for, or to pay, as obligor, guarantor or otherwise, on the Indebtedness of another Person (other than by endorsement of negotiable instruments for collection in the ordinary course of business); and

(3) to the extent not otherwise included, Indebtedness of another Person secured by a Lien on any asset owned by such Person (whether or not such Indebtedness is assumed by such Person); provided, however, that the amount of such Indebtedness will be the lesser of: (a) the Fair Market Value of such asset at such date of determination, and (b) the amount of such Indebtedness of such other Person;

provided that (a) Contingent Obligations Incurred in the ordinary course of business, (b) obligations under or in respect of Receivables Financings, (c) COLI Loans, (d) the Loan Notes and (e) Obligations associated with other post-employment benefits and pension plans shall be deemed not to constitute Indebtedness.

“Independent Financial Advisor” means an accounting, appraisal or investment banking firm or consultant, in each case of nationally recognized standing that is, in the good faith determination of Holdings, its direct or indirect parent or the Issuers, qualified to perform the task for which it has been engaged.

“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P, or an equivalent rating by any other Rating Agency.

 

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“Investment Grade Securities” means:

(1) securities issued or directly and fully guaranteed or insured by the U.S. government or any agency or instrumentality thereof (other than Cash Equivalents) and in each case with maturities not exceeding two years from the date of acquisition,

(2) securities that have a rating equal to or higher than Baa3 (or the equivalent) by Moody’s or BBB (or the equivalent) by S&P, or an equivalent rating by any other Rating Agency,

(3) investments in any fund that invests at least 95% of its assets in investments of the type described in clauses (1) and (2) which fund may also hold immaterial amounts of cash pending investment and/or distribution, and

(4) corresponding instruments in countries other than the United States customarily utilized for high quality investments and in each case with maturities not exceeding two years from the date of acquisition.

“Investments” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans (including guarantees), advances or capital contributions (excluding accounts receivable, trade credit and advances to customers and commission, travel and similar advances to officers, directors, employees and consultants made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities issued by any other Person and investments that are required by IFRS-EU to be classified on the balance sheet of Holdings in the same manner as the other investments included in this definition to the extent such transactions involve the transfer of cash or other property. For purposes of the definition of “Unrestricted Subsidiary” and the covenant described under “—Certain Covenants—Limitation on Restricted Payments”:

(1) “Investments” shall include the portion (proportionate to the applicable Holdings’ equity interest in such Subsidiary) of the Fair Market Value of the net assets of a Subsidiary of Holdings at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary, Holdings shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary equal to an amount (if positive) equal to:

(a) Holdings’ “Investment” in such Subsidiary at the time of such redesignation less

(b) the portion (proportionate to Holdings’ equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time of such redesignation; and

(2) any property transferred to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value at the time of such transfer, in each case as determined in good faith by the Board of Directors of the Issuers.

“Issue Date” means September 29, 2010.

“Loan Note Alternative” means the option made available to holders of Target Shares, subject to the terms and conditions set out in the Scheme Document, to elect to receive Loan Notes in place of the cash consideration otherwise payable.

“Loan Note Escrow Account” means an escrow or security account held at an institution reasonably acceptable to the Credit Agreement Collateral Agent provided for under an escrow and security agreement in form and substance reasonably satisfactory to the Credit Agreement Collateral Agent which will provide, among other things, that (i) so long as any Loan Notes are outstanding, release of funds from the Loan Note Escrow Account and any interest accrued thereon shall be only for the purposes of the payment of principal and interest on the Loan Notes and, in the event of either a substitution of the issuer of the Loan Notes or the exchange of the existing Loan Notes for Loan Notes of any new issuer, in each case in accordance with the terms of the Loan Note Instrument, the deposit of all funds in such Loan Note Escrow Account into a new Loan Note Escrow Account and (ii) in each interest period for the Loan Notes, the interest accruing on the funds in the Loan Note Escrow Account shall be sufficient to pay in full the interest accruing on the Loan Notes during such interest period.

“Loan Note Instrument” means the agreed form instrument constituting the Loan Notes and any certificates evidencing issued Loan Notes, each substantially in the form reasonably acceptable to the Credit Agreement Collateral Agent (or any substituted or exchange instrument that may be executed in accordance with the terms of the original Loan Note Instrument; provided that the terms and conditions of such substituted or exchange instrument are not materially less favorable to the holders of the notes, taken as a whole, than the terms and conditions of the original Loan Note Instrument).

“Loan Notes” means the loan notes to be issued pursuant to the Loan Note Instrument by Pinafore Acquisitions Limited (or any substituted or new issuer in accordance with the terms of the Loan Note Instrument) to electing holders of the Target Shares under the Loan Note Alternative in an aggregate principal amount not to exceed £50,000,000.

 

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“Management Agreement” means one or more Management Services Agreements, dated on or about the Issue Dates between Holdings or any of its Affiliates and the Sponsor, or a successor agreement between the Issuers, or Holdings or any of its Affiliates and the Sponsor, as may be amended, supplemented or otherwise modified from time to time; provided that such amendments, supplements or modifications are not materially adverse to the note holders as determined in good faith by the Issuers.

“Management Investor” means any Person who is a director, officer or otherwise a member of management of Holdings, any of the Restricted Subsidiaries or any of its direct or indirect parent companies on the Closing Date immediately after giving effect to the Transactions.

“Moody’s” means Moody’s Investors Service, Inc. or any successor to the rating agency business thereof.

“Net Cash Proceeds” means the aggregate cash proceeds received by Holdings or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received in respect of or upon the sale or other disposition of any Designated Non-cash Consideration received in any Asset Sale and any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise, but only as and when received, but excluding the assumption by the acquiring Person of Indebtedness relating to the disposed assets or other consideration received in any other non-cash form), net of the direct costs relating to such Asset Sale and the sale or disposition of such Designated Non-cash Consideration (including, without limitation, legal, accounting and investment banking fees, and brokerage and sales commissions), and any relocation expenses Incurred as a result thereof, taxes paid or payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements related thereto), amounts required to be applied to the repayment of principal, premium (if any) and interest on Indebtedness required (other than pursuant to the second paragraph of the covenant described under “—Certain Covenants—Asset Sales”) to be paid as a result of such transaction, and any deduction of appropriate amounts to be provided by the Issuers as a reserve in accordance with IFRS-EU against any liabilities associated with the asset disposed of in such transaction and retained by the Issuers after such sale or other disposition thereof, including, without limitation, pension and other post-employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations associated with such transaction.

“Net Income” means, with respect to any Person, the net income (loss) attributable to such Person, determined in accordance with IFRS-EU and before any reduction in respect of Preferred Stock dividends.

“Note Guarantee” means a guarantee of the notes pursuant to the Indenture.

“Note Guarantor” means any Person that Incurs a Note Guarantee; provided that upon the release or discharge of such Person from its Note Guarantee in accordance with the Indenture, such Person ceases to be a Note Guarantor.

“Obligations” means any principal, interest, penalties, fees, indemnifications, reimbursements (including, without limitation, reimbursement obligations with respect to letters of credit and bankers’ acceptances), damages and other liabilities payable under the documentation governing any Indebtedness; provided that Obligations with respect to the notes shall not include fees or indemnification in favor of the Trustee, the notes Collateral Agent and other third parties other than the holders of the notes.

“Officer” means the Chairman of the Board, Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, President, any Executive Vice President, Senior Vice President, Vice President or Assistant Vice President, the Controller, the Treasurer, the Assistant Treasurer or the Secretary of the Issuers.

“Officer’s Certificate” means a certificate signed on behalf of both Issuers by any one Officer of either of the Issuers, who must be the principal executive officer, the principal financial officer, the treasurer, general counsel or the principal accounting officer of one of the Issuers that meets the requirements set forth in the Indenture.

“Paying Agent” means an office or agency maintained by the Issuers pursuant to the terms of the Indenture, where notes may be presented for payment.

“Permitted Asset Swap” means the concurrent purchase and sale or exchange of Related Business Assets or a combination of Related Business Assets and cash or Cash Equivalents between Holdings or any of its Restricted Subsidiaries and another Person; provided that any cash or Cash Equivalents received must be applied in accordance with the covenant described under “—Certain Covenants—Asset Sales.”

“Permitted Holders” means (i) the Sponsor, (ii) the Management Investors, (iii) any Person that has no material assets other than the Capital Stock of Holdings and, directly or indirectly, holds or acquires 100% of the total voting power of the Voting Stock of Holdings, and of which no other Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), other than any Permitted Holder specified in clause (i) above, holds more than 50% of the total voting power of the Voting Stock thereof, and (iv) any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision) the members of which include any Permitted Holder specified in clauses (i) or (ii) above and that, directly or indirectly, hold or acquire beneficial ownership of the Voting Stock of Holdings (a “Permitted Holder Group”), so long as no Person or other “group” (other than a Permitted Holder specified in clause (i) and (iii) above) beneficially owns more than

 

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50% on a fully diluted basis of the Voting Stock held by the Permitted Holder Group. Any Person or group, together with its Affiliates, whose acquisition of beneficial ownership constitutes a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of the Indenture will thereafter constitute an additional Permitted Holder.

“Permitted Investments” means:

(1) any Investment in Holdings (including the notes) or any Restricted Subsidiary of Holdings;

(2) any Investment in Cash Equivalents or Investment Grade Securities;

(3) any Investment by Holdings or any Restricted Subsidiary of Holdings in a Person that is primarily engaged in a Similar Business if as a result of such Investment (a) such Person becomes a Restricted Subsidiary of Holdings, or (b) such Person, in one transaction or a series of related transactions, is merged, consolidated or amalgamated with or into, or transfers or conveys all or substantially all of its assets to, or is liquidated into, Holdings or a Restricted Subsidiary of Holdings;

(4) any Investment in securities or other assets not constituting Cash Equivalents and received in connection with an Asset Sale made pursuant to the provisions of “—Certain Covenants—Asset Sales” or any other disposition of assets not constituting an Asset Sale;

(5) any Investment (x) existing on the Issue Date, (y) made pursuant to binding commitments in effect on the Issue Date and (z) that replaces, refinances, refunds, renews or extends any Investment described under either of the immediately preceding clauses (x) or (y), provided that any such Investment is in an amount that does not exceed the amount replaced, refinanced, refunded, renewed or extended;

(6) advances to employees not in excess of $5.0 million outstanding at any one time in the aggregate;

(7) any Investment acquired by Holdings or any of its Restricted Subsidiaries (a) in exchange for any other Investment or accounts receivable held by Holdings or any such Restricted Subsidiary in connection with or as a result of a bankruptcy, workout, reorganization or recapitalization of the issuer of such other Investment or accounts receivable, or (b) as a result of a foreclosure by Holdings or any of its Restricted Subsidiaries with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;

(8) Hedging Obligations permitted under clause (j) of “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”;

(9) additional Investments by Holdings or any of its Restricted Subsidiaries having an aggregate Fair Market Value, taken together with all other Investments made pursuant to this clause (9) that are at the time outstanding, not to exceed $100.0 million (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value), at any one time outstanding;

(10) loans and advances to officers, directors and employees for business related travel expenses, moving and relocation expenses and other similar expenses, in each case Incurred in the ordinary course of business;

(11) Investments the payment for which consists of Equity Interests of Holdings (other than Disqualified Stock) or any direct or indirect parent of Holdings, as applicable; provided, however, that such Equity Interests will not increase the amount available for Restricted Payments under clause (c) of the first paragraph of the covenant described under “—Certain Covenants—Limitation on Restricted Payments”;

(12) any transaction to the extent it constitutes an Investment that is permitted by and made in accordance with the provisions of the second paragraph of the covenant described under “—Certain Covenants—Transactions with Affiliates” (except transactions described in clauses (2), (4), (5), (8)(b), (22), (23) and (24) of such paragraph);

(13) Investments consisting of the licensing or contribution of intellectual property pursuant to joint marketing arrangements with other Persons;

(14) guarantees issued in accordance with the covenants described under “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock” and “—Certain Covenants—Future Guarantors”;

(15) any Investment by Restricted Subsidiaries of Holdings in other Restricted Subsidiaries of Holdings and Investments by Subsidiaries that are not Restricted Subsidiaries in other Subsidiaries that are not Restricted Subsidiaries of Holdings;

 

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(16) Investments consisting of purchases and acquisitions of inventory, supplies, materials and equipment or purchases of contract rights or licenses or leases of intellectual property, in each case in the ordinary course of business;

(17) any Investment in a Receivables Subsidiary or any Investment by a Receivables Subsidiary in any other Person in connection with a Qualified Receivables Financing, including Investments of funds held in accounts permitted or required by the arrangements governing such Qualified Receivables Financing or any related Indebtedness; provided, however, that any Investment in a Receivables Subsidiary is in the form of a Purchase Money Note, contribution of additional receivables or an equity interest;

(18) Investments resulting from the receipt of non-cash consideration in an Asset Sale received in compliance with the covenant described under “—Certain Covenants—Asset Sales”;

(19) Investments in joint ventures of Holdings or any of its Restricted Subsidiaries existing on the Issue Date and additional Investments in joint ventures in an aggregate amount not to exceed $100.0 million at any one time outstanding;

(20) Investments constituting COLI Loans; and

(21) Investments of a Restricted Subsidiary of Holdings acquired after the Issue Date or of an entity merged into or consolidated with a Restricted Subsidiary of Holdings in a transaction that is not prohibited by the covenant described under “—Merger, Consolidation or Sale of All or Substantially All Assets” after the Issue Date to the extent that such Investments were not made in contemplation of such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation.

“Permitted Liens” means, with respect to any Person:

(1) pledges or deposits by such Person under workmen’s compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person or deposits of cash or U.S. government bonds to secure surety or appeal bonds to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, in each case Incurred in the ordinary course of business;

(2) Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens, in each case for sums not yet due or being contested in good faith by appropriate proceedings or other Liens arising out of judgments or awards against such Person with respect to which such Person shall then be proceeding with an appeal or other proceedings for review (or which, if due and payable, are being contested in good faith by appropriate proceedings and for which adequate reserves are being maintained, to the extent required by IFRS-EU and such proceedings have the effect of preventing the forfeiture or sale of the property or assets subject to any such Lien);

(3) Liens for taxes, assessments or other governmental charges (i) which are not yet due or payable or (ii) which are being contested in good faith by appropriate proceedings that have the effect of preventing the forfeiture or sale of the property or assets subject to any such Lien and for which adequate reserves are being maintained to the extent required by IFRS-EU;

(4) Liens in favor of issuers of performance and surety bonds or bid bonds or with respect to other regulatory requirements or letters of credit issued pursuant to the request of and for the account of such Person in the ordinary course of its business;

(5) minor survey exceptions, minor encumbrances, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real properties or Liens incidental to the conduct of the business of such Person or to the ownership of its properties which were not Incurred in connection with Indebtedness and which do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;

(6) Liens Incurred to secure Obligations in respect of Indebtedness permitted to be Incurred pursuant to clauses (a), (d) or (s) of the second paragraph of the covenant described under “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”; provided that, (x) in the case of clause (d), such Lien extends only to the assets and/or Capital Stock, the acquisition, lease, construction, repair, replacement or improvement of which is financed thereby and any income or profits thereof; and (y) in the case of clause (s), such Lien does not extend to the property or assets (or income or profits therefrom) of any Restricted Subsidiary other than a Foreign Subsidiary that is not a Note Guarantor;

(7) Liens existing on the Issue Date;

 

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(8) Liens on assets, property or shares of stock of a Person at the time such Person becomes a Subsidiary; provided, however, that such Liens are not created or Incurred in connection with, or in contemplation of, such other Person becoming such a Subsidiary; provided, further, however, that such Liens may not extend to any other property owned by the Issuers or any Restricted Subsidiary of the Issuers;

(9) Liens on assets or on property at the time Holdings or a Restricted Subsidiary of Holdings acquired the assets or property, including any acquisition by means of a merger or consolidation with or into Holdings or any Restricted Subsidiary of Holdings; provided, however, that such Liens are not created or Incurred in connection with, or in contemplation of, such acquisition; provided, further, however, that the Liens may not extend to any other assets or property owned by Holdings or any Restricted Subsidiary of Holdings;

(10) Liens securing Indebtedness or other obligations of a Restricted Subsidiary owing to Holdings or another Restricted Subsidiary of Holdings permitted to be Incurred in accordance with the covenant described under “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock”;

(11) Liens securing Hedging Obligations so long as the related Indebtedness is, and is permitted to be under the Indenture, secured by a Lien on the same property securing such Hedging Obligations;

(12) Liens on specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;

(13) leases and subleases of real property which do not materially interfere with the ordinary conduct of the business of Holdings or any of its Restricted Subsidiaries;

(14) Liens arising from Uniform Commercial Code financing statement filings regarding operating leases entered into by Holdings and its Restricted Subsidiaries in the ordinary course of business;

(15) Liens in favor of the Issuers or any Note Guarantor;

(16) Liens on accounts receivable and related assets of the type specified in the definition of “Receivables Financing” Incurred in connection with a Qualified Receivables Financing;

(17) deposits made in the ordinary course of business to secure liability to insurance carriers;

(18) Liens on the Equity Interests of Unrestricted Subsidiaries;

(19) grants of software and other technology licenses in the ordinary course of business;

(20) judgment and attachment Liens not giving rise to an Event of Default and notices of lis pendens and associated rights related to litigation being contested in good faith by appropriate proceedings and for which adequate reserves have been made;

(21) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into in the ordinary course of business;

(22) Liens Incurred to secure cash management services (and other “bank products”), owed to a lender under the Credit Agreement in the ordinary course of business;

(23) Liens on equipment of Holdings or any Restricted Subsidiary of Holdings granted in the ordinary course of business to Holdings’ or such Restricted Subsidiary’s client at which such equipment is located;

(24) Liens to secure any refinancing, refunding, extension, renewal or replacement (or successive refinancings, refundings, extensions, renewals or replacements) as a whole, or in part, of any Indebtedness secured by any Lien referred to in the foregoing clauses (7), (8), (9), (10), (11) and (15); provided, however, that (x) such new Lien shall be limited to all or part of the same property that secured the original Lien (plus improvements on such property), and (y) the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (A) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clauses (7), (8), (9), (10), (11) and (15) at the time the original Lien became a Permitted Lien under the Indenture, and (B) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing, refunding, extension, renewal or replacement;

(25) other Liens securing obligations Incurred in the ordinary course of business which obligations do not exceed $150.0 million at any one time outstanding;

 

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(26) Liens on equipment of Holdings or any Restricted Subsidiary of Holdings granted in the ordinary course of business to Holdings’ or such Restricted Subsidiary’s client at which such equipment is located;

(27) judgment and attachment Liens not giving rise to an Event of Default and notices of lis pendens and associated rights related to litigation being contested in good faith by appropriate proceedings and for which adequate reserves have been made;

(28) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into in the ordinary course of business;

(29) Liens securing the Second Lien Note Obligations;

(30) Liens on the Collateral in favor of any collateral agent relating to such collateral agent’s administrative expenses with respect to the Collateral;

(31) Liens associated with COLI Loans;

(32) Liens securing Indebtedness permitted to be incurred pursuant to the covenant described under “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock” in an amount not to exceed the maximum amount of Indebtedness such that the Consolidated Senior Secured Debt Ratio (at the time of incurrence of such Indebtedness after giving pro forma effect thereto in a manner consistent with the calculation of the Fixed Charge Coverage Ratio) would not be greater than 3.25 to 1.00; provided that such Liens are subject to the Second Lien Intercreditor Agreement on a pari passu or junior lien basis with the notes;

(33) Liens on receivable and related assets including proceeds thereof being sold in factoring arrangements entered into in the ordinary course of business; and

(34) Liens on the Loan Note Escrow Account securing obligations of Holdings or any of its Restricted Subsidiaries under the Loan Notes.

“Person” means any natural person, corporation, limited partnership, general partnership, limited liability company, limited liability partnership, joint venture, association, joint stock company, trust, bank trust company, land trust, business trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity whether legal or not.

“Preferred Stock” means any Equity Interest with preferential right of payment of dividends or redemptions upon liquidation, dissolution, or winding up.

“Purchase Money Note” means a promissory note of a Receivables Subsidiary evidencing a line of credit, which may be irrevocable, from Holdings or any Subsidiary of Holdings to a Receivables Subsidiary in connection with a Qualified Receivables Financing, which note is intended to finance that portion of the purchase price that is not paid by cash or a contribution of equity

“Qualified Receivables Financing” means any Receivables Financing of a Receivables Subsidiary that meets the following conditions:

(1) the Board of Directors of Holdings shall have determined in good faith that such Qualified Receivables Financing (including financing terms, covenants, termination events and other provisions) is in the aggregate economically fair and reasonable to Holdings and the Receivables Subsidiary,

(2) all sales of accounts receivable and related assets to the Receivables Subsidiary are made at Fair Market Value (as determined in good faith by the Issuers), and

(3) the financing terms, covenants, termination events and other provisions thereof shall be market terms (as determined in good faith by the Issuers) and may include Standard Securitization Undertakings.

The grant of a security interest in any accounts receivable of Holdings or any Restricted Subsidiary of Holdings (other than a Receivables Subsidiary) to secure any Indebtedness shall not be deemed a Qualified Receivables Financing.

“Rating Agency” means (1) each of Moody’s and S&P and (2) if Moody’s or S&P ceases to rate the notes for reasons outside of the Issuer’s control, a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act selected by the Issuers or any parent of the Issuers as a replacement agency for Moody’s or S&P, as the case may be.

 

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“Receivables Fees” means distributions or payments made directly or by means of discounts with respect to any participation interest issued or sold in connection with, and other fees paid to a Person that is not a Restricted Subsidiary in connection with, any Receivables Financing.

“Receivables Financing” means any transaction or series of transactions that may be entered into by Holdings or any Subsidiary of Holdings pursuant to which Holdings or any of its Subsidiaries may sell, convey or otherwise transfer to (a) a Receivables Subsidiary (in the case of a transfer by Holdings or any of its Subsidiaries), and (b) any other Person (in the case of a transfer by a Receivables Subsidiary), or may grant a security interest in, any accounts receivable (whether now existing or arising in the future) of Holdings or any of its Subsidiaries, and any assets related thereto including, without limitation, all collateral securing such accounts receivable, all contracts and all guarantees or other obligations in respect of such accounts receivable, proceeds of such accounts receivable and other assets which are customarily transferred or in respect of which security interests are customarily granted in connection with asset securitization transactions involving accounts receivable and any Hedging Obligations entered into by Holdings or any such Subsidiary in connection with such accounts receivable.

“Receivables Repurchase Obligation” means any obligation of a seller of receivables in a Qualified Receivables Financing to repurchase receivables arising as a result of a breach of a representation, warranty or covenant or otherwise, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, off-set or counterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.

“Receivables Subsidiary” means a Wholly Owned Restricted Subsidiary of Holdings (or another Person formed for the purposes of engaging in a Qualified Receivables Financing with Holdings in which Holdings or any Subsidiary of Holdings makes an Investment and to which Holdings or any Subsidiary of Holdings transfers accounts receivable and related assets) which engages in no activities other than in connection with the financing of accounts receivable of Holdings and its Subsidiaries, all proceeds thereof and all rights (contractual or other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and which is designated by the Board of Directors of the Issuers (as provided below) as a Receivables Subsidiary and:

(a) no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (i) is guaranteed by Holdings or any other Subsidiary of Holdings (excluding guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (ii) is recourse to or obligates Holdings or any other Subsidiary of Holdings in any way other than pursuant to Standard Securitization Undertakings, or (iii) subjects any property or asset of Holdings or any other Subsidiary of Holdings, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other pursuant to Standard Securitization Undertakings,

(b) with which neither Holdings nor any other Subsidiary of Holdings has any material contract, agreement, arrangement or understanding other than on terms which the Issuers reasonably believe to be no less favorable to Holdings or such Subsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Issuers, and

(c) to which neither Holdings nor any other Subsidiary of Holdings has any obligation to maintain or preserve such entity’s financial condition or cause such entity to achieve certain levels of operating results.

Any such designation by the Board of Directors of the Issuers shall be evidenced to the Trustee by filing with the Trustee a certified copy of the resolution of the Board of Directors of the Issuers giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the foregoing conditions.

“Related Business Assets” means assets (other than cash or Cash Equivalents) used or useful in a Similar Business; provided that any assets received by Holdings or a Restricted Subsidiary in exchange for assets transferred by Holdings or a Restricted Subsidiary will not be deemed to be Related Business Assets if they consist of securities of a Person, unless upon receipt of the securities of such Person, such Person would become a Restricted Subsidiary.

“Restricted Investment” means an Investment other than a Permitted Investment.

“Restricted Subsidiary” means, at any time any direct or indirect Subsidiary of Holdings (including any Foreign Subsidiary) that is not then an Unrestricted Subsidiary; provided, however, that upon an Unrestricted Subsidiary’s ceasing to be an Unrestricted Subsidiary, such Subsidiary shall be included in the definition of “Restricted Subsidiary”.

“Sale/Leaseback Transaction” means an arrangement relating to assets or property now owned or hereafter acquired by the Person whereby the Issuers or a Restricted Subsidiary transfers such assets or property to a Person and the Issuers or such Restricted Subsidiary leases it from such Person, other than leases between the Issuers and a Restricted Subsidiary of the Issuers or between Restricted Subsidiaries of the Issuers.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor to the rating agency business thereof.

 

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“Scheme” means a scheme of arrangement made pursuant to Part 26 of the Companies Act in relation to the cancellation of the entire issued share capital of Tomkins plc and the subsequent issue of new shares in the Tomkins plc to the Issuers as contemplated by the press release made by or on behalf of the Issuers announcing the terms of the Scheme.

“Scheme Document” means the scheme document to be issued by Tomkins plc to its shareholders in respect of the Scheme on substantially the same terms, other than with respect to the Loan Notes, as set forth in the Scheme Press Release.

“Scheme Press Release” means the press release made by or on behalf of Holdings announcing the terms of the Scheme.

“SEC” means the U.S. Securities and Exchange Commission.

“Second Lien Collateral Agent” means the Trustee, in its capacity as “Collateral Agent” under the Second Lien Notes Indenture and any successor thereto.

“Second Lien Intercreditor Agreement” means the junior lien intercreditor agreement dated as of July 27, 2010, among the Issuers, Citibank, N.A. as senior representative for the credit agreement secured parties, Bank of America, N.A. as initial second priority representative and each additional authorized representative for time to time party thereto, as amended on the Issue Date, as further amended, restated, amended and restated, extended, supplemented or otherwise modified in accordance with its terms.

“Second Lien Note Documents” means the Second Lien Notes, the Second Lien Notes Indenture and the Second Lien Security Documents.

“Second Lien Note Obligations” means any obligations in respect of the Second Lien Notes, the Second Lien Notes Indenture and the Second Lien Security Documents, including, for the avoidance of doubt, obligations in respect of exchange notes and guarantees thereof.

“Second Lien Note Secured Parties” means, at any time, (a) the holders of the Second Lien Notes, (b) the Second Lien Notes Trustee and the Second Lien Collateral Agent, (c) the beneficiaries of each indemnification obligation undertaken by the Issuers and any note guarantor party to the Second Lien Notes Indenture or under any Second Lien Note Document and (d) the successors and permitted assigns of each of the foregoing.

“Second Lien Notes” means the Issuers’ 9% Second Lien Notes due 2018 issued on the Issue Date.

“Second Lien Notes Indenture” means the Indenture dated as of the Issue Date among Holdings, the Issuers and certain of their subsidiaries party thereto and the trustee named therein from time to time, as amended, restated, supplemented or otherwise modified from time to time in accordance with the requirements thereof and of the Indenture.

“Second Lien Notes Trustee” means Wilmington Trust FSB, as collateral trustee for the holders of the Second Lien Notes.

“Second Lien Obligations” means, collectively, (a) the Second Lien Note Obligations and (b) any Series of Additional Second Lien Obligations.

“Second Lien Security Documents” means the Security Documents and any other agreement, document or instrument pursuant to which a Lien is granted or purported to be granted securing Second Lien Obligations or under which rights or remedies with respect to such Liens are governed, in each case to the extent relating to the collateral securing the Second Lien Obligations.

“Securities Act ” means the Securities Act of 1933, as amended.

“Security Agreement” means the Securities Agreement dated as of the Issue Note by and among the Collateral Agent, Holdings and certain of its Subsidiaries.

“Security Documents” means, collectively, the Second Lien Intercreditor Agreement, the Security Agreement, other security agreements relating to the Collateral and the mortgages and instruments filed and recorded in appropriate jurisdictions to preserve and protect the Liens on the Collateral (including, without limitation, financing statements under the Uniform Commercial Code of the relevant states) applicable to the Collateral, each as in effect on the Issue Date and as amended, amended and restated, modified, renewed or replaced from time to time.

“Senior Documents” means the credit, guarantee and security documents governing the Senior Obligations, including, without limitation, the Senior Security Documents.

“Senior Obligations” means, collectively, (a) all Credit Agreement Obligations and (b) any Series of Additional Senior Obligations.

 

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“Senior Representative” means (i) in the case of any Credit Agreement Obligations or the Credit Agreement Secured Parties, the administrative agent under the Credit Agreement, and (ii) in the case of any Series of Senior Obligations or Additional Senior Secured Parties that become subject to the Second Lien Intercreditor Agreement, the Representative (as defined in the Second Lien Intercreditor Agreement) named for such Series in the applicable joinder agreement.

“Senior Security Documents” means the agreements, documents or instruments pursuant to which a Lien is granted or purported to be granted securing Senior Obligations and any Additional Senior Obligations or under which rights or remedies with respect to such Liens are governed, in each case to the extent relating to the collateral securing the Senior Obligations.

“Series” means (a) with respect to the Second Lien Obligations, each of (i) the Second Lien Note Obligations and (ii) the Additional Second Lien Obligations incurred pursuant to any applicable agreement, which, pursuant to any joinder agreement, are to be represented under the Second Lien Intercreditor Agreement by a Representative (as defined in the Second Lien Intercreditor Agreement) (in its capacity as such for such Additional Second Lien Obligations) and (b) with respect to the Senior Obligation, each of (i) the Credit Agreement Obligations and (ii) the Additional Senior Obligations incurred pursuant to any applicable agreement, which, pursuant to any joinder agreement, are to be represented under the Second Lien Intercreditor Agreement by a Representative (in its capacity as such for such Additional Senior Obligation).

“Significant Subsidiary” means any Restricted Subsidiary that would be a “Significant Subsidiary” within the meaning of Rule 1-02 under the Securities Act.

“Similar Business” means any business engaged in by Holdings or any Restricted Subsidiaries of Holdings on the date of the Issue Date and any business or other activities that are reasonably similar, ancillary, complementary or related to, or a reasonable extension, development or expansion of, the businesses in which Holdings and the Restricted Subsidiaries are engaged on the date of the Issue Date.

“Sponsor” means (1) Onex Partners, (2) Canada Pension Plan Investment Board and/or (3) one or more investment funds advised, managed or controlled by Onex Partners or Canada Pension Plan Investment Board and, in each case (whether individually or as a group) their Affiliates.

“Standard Securitization Undertakings” means representations, warranties, covenants, indemnities and guarantees of performance entered into by Holdings or any Subsidiary of Holdings which Holdings has determined in good faith to be customary in a Receivables Financing including, without limitation, those relating to the servicing of the assets of a Receivables Subsidiary, it being understood that any Receivables Repurchase Obligation shall be deemed to be a Standard Securitization Undertaking.

“Stated Maturity” means, with respect to any security, the date specified in such security as the fixed date on which the final payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency beyond the control of the issuer unless such contingency has occurred).

“Subordinated Indebtedness” means (a) with respect to an Issuer, any Indebtedness of such Issuer which is by its terms subordinated in right of payment to the notes or which is secured on a subordinated basis to any Second Lien Obligations of such Issuer, and (b) with respect to any Note Guarantor, any Indebtedness of such Note Guarantor which is by its terms subordinated in right of payment to its Note Guarantee or which is secured on a subordinated basis to any Second Lien Obligations of such Note Guarantor.

“Subsidiary” means, with respect to any Person (1) any corporation, partnership, limited liability company, unlimited liability company, association, joint venture or other business entity (other than a partnership, joint venture or limited liability company) of which more than 50% of the total voting power of shares of stock or other ownership interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Person or Persons (whether directors, managers, trustees or other Persons performing similar functions having the power to direct or cause the direction of the management and policies thereof at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, (2) any partnership, joint venture or limited liability company of which (x) more than 50% of the capital accounts, distribution rights, total equity and voting interests or general and limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof, whether in the form of membership, general, special or limited partnership interests or otherwise, and (y) such Person or any Restricted Subsidiary of such Person is a controlling general partner or otherwise controls such entity and (3) any Person that is consolidated in the consolidated financial statements of the specified Person in accordance with IFRS-EU.

“Swap Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities (including, for the avoidance of doubt, resin), equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided, that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Issuers or any of the Subsidiaries shall be a Swap Agreement.

 

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“Target Shares” means all the issued and unconditionally allotted share capital in Tomkins plc and any further shares in the capital of Tomkins plc which may be issued or unconditionally allotted pursuant to the exercise of any outstanding subscription or conversion rights or otherwise together with all related rights.

“TIA” means the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb), as amended.

“Total Assets” means the total consolidated assets of Holdings and the Restricted Subsidiaries of Holdings, as shown on the most recent consolidated balance sheet of Holdings and its Restricted Subsidiaries.

“Transactions” means, collectively, the Scheme and the other transactions contemplated in the Offering Memorandum for the notes as of the date thereof.

“Treasury Rate” means, as of the applicable redemption date, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two business days prior to such redemption date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from such redemption date to October 1, 2014; provided, however, that if the period from such redemption date to October 1, 2014 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.

“Trustee” means the respective party named as such in the Indenture until a successor replaces it and, thereafter, means the successor.

“Unrestricted Subsidiary” means:

(1) any Subsidiary of Holdings that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors of such Person in the manner provided below; and

(2) any Subsidiary of an Unrestricted Subsidiary.

The Board of Directors of the Issuers may designate any Subsidiary of Holdings (including any newly acquired or newly formed Subsidiary of Holdings but excluding Holdings) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Equity Interests or Indebtedness of, or owns or holds any Lien on any property of, Holdings or any other Subsidiary of Holdings that is not a Subsidiary of the Subsidiary to be so designated; provided, however, that the Subsidiary to be so designated and its Subsidiaries do not at the time of designation have and do not thereafter Incur any Indebtedness pursuant to which the lender has recourse to any of the assets of the Issuers or any of their Restricted Subsidiaries; provided, further, however, that either:

(a) the Subsidiary to be so designated has total consolidated assets of $1,000 or less; or

(b) if such Subsidiary has consolidated assets greater than $1,000, then such designation would be permitted under the covenant described under “—Certain Covenants—Limitation on Restricted Payments.”

The Board of Directors of the Issuers may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that immediately after giving effect to such designation:

(x)(1) the Issuers could Incur $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test described under “—Certain Covenants—Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock,” or

(2) the Fixed Charge Coverage Ratio for Holdings and its Restricted Subsidiaries would be greater than such ratio for the Issuer and its Restricted Subsidiaries immediately prior to such designation, in each case on a pro forma basis taking into account such designation, and

(y) no Event of Default shall have occurred and be continuing.

Any such designation by the Board of Directors of the Issuers shall be evidenced to the Trustee by promptly filing with the Trustee a copy of the resolution of the Board of Directors of the Issuers giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the foregoing provisions.

 

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“U.S. Government Obligations” means securities that are:

(1) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged, or

(2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America,

which, in each case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act) as custodian with respect to any such U.S. Government Obligations or a specific payment of principal of or interest on any such U.S. Government Obligations held by such custodian for the account of the holder of such depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligations or the specific payment of principal of or interest on the U.S. Government Obligations evidenced by such depository receipt.

“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.

“Weighted Average Life to Maturity” means, when applied to any Indebtedness or Disqualified Stock, as the case may be, at any date, the quotient obtained by dividing (1) the sum of the products of the number of years from the date of determination to the date of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Disqualified Stock multiplied by the amount of such payment, by (2) the sum of all such payments.

“Wholly Owned Restricted Subsidiary” is any Wholly Owned Subsidiary that is a Restricted Subsidiary.

“Wholly Owned Subsidiary” of any Person means a Subsidiary of such Person 100% of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares or shares or interests required to be held by foreign nationals or other third parties to the extent required by applicable law) shall at the time be owned by such Person or by one or more Wholly Owned Subsidiaries of such Person and one or more Wholly Owned Subsidiaries of such Person.

 

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BOOK-ENTRY, DELIVERY AND FORM OF SECURITIES

The Global Notes

The exchange notes will be issued in the form of one or more registered notes in global form, without interest coupons (the “global notes”).

Upon issuance, each of the global notes will be deposited with the trustee as custodian for DTC and registered in the name of Cede & Co., as nominee of DTC.

Ownership of beneficial interests in each global note will be limited to persons who have accounts with DTC (“DTC participants”) or persons who hold interests through DTC participants. We expect that under procedures established by DTC:

 

  •  

upon deposit of each global note with DTC’s custodian, DTC will credit portions of the principal amount of the global note to the accounts of the DTC participants designated by the initial purchasers; and

 

  •  

ownership of beneficial interests in each global note will be shown on, and transfer of ownership of those interests will be effected only through, records maintained by DTC (with respect to interests of DTC participants) and the records of DTC participants (with respect to other owners of beneficial interests in the global note).

Beneficial interests in the global notes may not be exchanged for notes in physical, certificated form except in the limited circumstances described below.

Book-Entry Procedures for the Global Notes

All interests in the global notes will be subject to the operations and procedures of DTC, Euroclear Bank S.A./N.V. (“Euroclear”) and Clearstream Banking, Société Anonyme (“Clearstream”). We provide the following summaries of those operations and procedures solely for the convenience of investors. The operations and procedures of each settlement system are controlled by that settlement system and may be changed at any time. We are not responsible for those operations or procedures.

DTC has advised us that it is:

 

  •  

a limited purpose trust company organized under the laws of the State of New York;

 

  •  

a “banking organization” within the meaning of the New York State Banking Law;

 

  •  

a member of the Federal Reserve System;

 

  •  

a “clearing corporation” within the meaning of the New York Uniform Commercial Code; and

 

  •  

a “clearing agency” registered under Section 17A of the Exchange Act.

DTC was created to hold securities for its participants and to facilitate the clearance and settlement of securities transactions between its participants through electronic book-entry changes to the accounts of its participants. DTC’s participants include securities brokers and dealers; banks and trust companies; clearing corporations and other organizations. Indirect access to DTC’s system is also available to others such as banks, brokers, dealers and trust companies; these indirect participants clear through or maintain a custodial relationship with a DTC participant, either directly or indirectly. Investors who are not DTC participants may beneficially own securities held by or on behalf of DTC only through DTC participants or indirect participants in DTC.

 

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So long as DTC’s nominee is the registered owner of a global note, that nominee will be considered the sole owner or holder of the notes represented by that global note for all purposes under the indenture. Except as provided below, owners of beneficial interests in a global note:

 

  •  

will not be entitled to have notes represented by the global note registered in their names;

 

  •  

will not receive or be entitled to receive physical, certificated notes; and

 

  •  

will not be considered the owners or holders of the notes under the indenture for any purpose, including with respect to the giving of any direction, instruction or approval to the trustee under the indenture.

As a result, each investor who owns a beneficial interest in a global note must rely on the procedures of DTC to exercise any rights of a noteholder under the indenture (and, if the investor is not a participant or an indirect participant in DTC, on the procedures of the DTC participant through which the investor owns its interest).

Payments of principal, premium (if any) and interest with respect to the notes represented by a global note will be made by the trustee to DTC’s nominee as the registered holder of the global note. Neither we nor the trustee will have any responsibility or liability for the payment of amounts to owners of beneficial interests in a global note, for any aspect of the records relating to or payments made on account of those interests by DTC, or for maintaining, supervising or reviewing any records of DTC relating to those interests.

Payments by participants and indirect participants in DTC to the owners of beneficial interests in a global note will be governed by standing instructions and customary industry practice and will be the responsibility of those participants or indirect participants and DTC.

Transfers between participants in DTC will be effected under DTC’s procedures and will be settled in same-day funds. Transfers between participants in Euroclear or Clearstream will be effected in the ordinary way under the rules and operating procedures of those systems.

Cross-market transfers between DTC participants, on the one hand, and Euroclear or Clearstream participants, on the other hand, will be effected within DTC through the DTC participants that are acting as depositaries for Euroclear and Clearstream. To deliver or receive an interest in a global note held in a Euroclear or Clearstream account, an investor must send transfer instructions to Euroclear or Clearstream, as the case may be, under the rules and procedures of that system and within the established deadlines of that system. If the transaction meets its settlement requirements, Euroclear or Clearstream, as the case may be, will send instructions to its DTC depositary to take action to effect final settlement by delivering or receiving interests in the relevant global notes in DTC, and making or receiving payment under normal procedures for same-day funds settlement applicable to DTC. Euroclear and Clearstream participants may not deliver instructions directly to the DTC depositaries that are acting for Euroclear or Clearstream.

Because of time zone differences, the securities account of a Euroclear or Clearstream participant that purchases an interest in a global note from a DTC participant will be credited on the business day for Euroclear or Clearstream immediately following the DTC settlement date. Cash received in Euroclear or Clearstream from the sale of an interest in a global note to a DTC participant will be received with value on the DTC settlement date but will be available in the relevant Euroclear or Clearstream cash account as of the business day for Euroclear or Clearstream following the DTC settlement date.

DTC, Euroclear and Clearstream have agreed to the above procedures to facilitate transfers of interests in the global notes among participants in those settlement systems. However, the settlement systems are not obligated to perform these procedures and may discontinue or change these procedures at any time. Neither we nor the trustee will have any responsibility for the performance by DTC, Euroclear or Clearstream or their participants or indirect participants of their obligations under the rules and procedures governing their operations.

Certificated Notes

Notes in physical, certificated form will be issued and delivered to each person that DTC identifies as a beneficial owner of the related notes only if:

 

  •  

DTC notifies us at any time that it is unwilling, unable or ineligible to continue as depositary for the global notes or ceases to be registered as a clearing agency under the Exchange Act and a successor depositary is not appointed within 90 days of the date we are so informed in writing or become aware of same;

 

  •  

we, at our option and subject to DTC’s procedures, notify the trustee that we elect to cause the issuance of certificated notes; or

 

  •  

certain other events provided in the indenture should occur.

 

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MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

The following discussion is a summary of the material U.S. federal income tax considerations relevant to the exchange of initial notes for exchange notes pursuant to the exchange offer, but does not purport to be a complete analysis of all potential tax effects. The discussion is based upon the Internal Revenue Code of 1986, as amended, U.S. Treasury Regulations issued thereunder, Internal Revenue Service (“IRS”) rulings and pronouncements and judicial decisions now in effect, all of which are subject to change at any time. Any such change may be applied retroactively in a manner that could adversely affect a holder of the notes. This discussion does not address all of the U.S. federal income tax consequences that may be relevant to a holder in light of such holder’s particular circumstances or to holders subject to special rules, such as banks, financial institutions, U.S. expatriates, foreign persons or entities, insurance companies, dealers in securities or currencies, traders in securities, partnerships or other pass-through entities or investors in such entities, holders whose functional currency is not the U.S. dollar, tax-exempt organizations and persons holding the notes as part of a “straddle,” “hedge,” “conversion transaction” or other integrated transaction. Moreover, the effect of any applicable state, local or foreign tax laws is not discussed. The discussion applies only to holders that exchange initial notes for exchange notes pursuant to the exchange offer.

No rulings from the IRS have or will be sought with respect to the matters discussed below. There can be no assurance that the IRS will not take a different position concerning the tax consequences of the exchange of initial notes for exchange notes or that any such position would not be sustained. Holders of notes should consult their own tax advisors with regard to the application of the tax consequences discussed below to their particular situations as well as the application of any state, local, foreign or other tax laws, including gift and estate tax laws, and any tax treaties.

Characterization of the Notes

For U.S. federal income tax purposes, while not free from doubt, we intend to treat the notes as debt of Tomkins, LLC. The determination of whether an instrument is debt or equity for U.S. federal income tax purposes is an inherently factual question, and no one factor is determinative. There can be no assurance that the IRS will not contend, and that a court will not ultimately hold, that the notes are equity. In such event, holders of the notes could be subject to different tax consequences than what is described below. The following discussion assumes that the notes are property treated as debt of Tomkins, LLC for U.S. federal income tax purposes.

Exchange Pursuant to the Exchange Offer

The exchange of the initial notes for the exchange notes in the exchange offer will not be treated as an “exchange” for U.S. federal income tax purposes, because the exchange notes will not be considered to differ materially in kind or extent from the initial notes. Accordingly, the exchange of initial notes for exchange notes will not be a taxable event to holders for U.S. federal income tax purposes. Moreover, the exchange notes will have the same tax attributes as the initial notes exchanged therefor and the same tax consequences to holders as the initial notes have to holders, including without limitation, the same issue price, adjusted issue price, adjusted tax basis and holding period.

 

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ERISA CONSIDERATIONS

Each purchaser and transferee of notes will be deemed to have represented and agreed as follows:

It shall not sell or otherwise transfer the notes to, and is not acquiring the notes for or on behalf of, any pension or welfare plan (as defined in Section 3 of the Employee Retirement Income Security Act of 1974 “ERISA”) or plan (as defined in Section 4975 of the Code) (a “Plan”), except that such an acquisition for or on behalf of a Plan shall be permitted:

 

  I. to the extent such acquisition is made by or on behalf of a bank collective investment fund maintained by the purchaser in which no Plan (together with any other Plans maintained by the same employer or employee organization) has an interest in excess of 10% of the total assets in such collective investment fund and the conditions of Section III of Prohibited Transaction Class Exemption 91-38 issued by the Department of Labor are satisfied;

 

  II. to the extent such acquisition is made by or on behalf of an insurance company pooled separate account maintained by the acquirer in which no Plan (together with any other Plans maintained by the same employer or employee organization) has an interest in excess of 10% of the total assets in such pooled separate account and the conditions of Section III of Prohibited Transaction Class Exemption 90-1 issued by the Department of Labor are satisfied;

 

  III. to the extent such acquisition is made by or on behalf of an insurance company with assets in its insurance company general account if no Plan (together with any other Plans maintained by the same employer or employee organization) has an interest in the general account, the amount of reserves and liabilities which exceed 10% of the total reserves and liabilities of the general account plus surplus, determined as set forth in Prohibited Transaction Class Exemption 95-60 issued by the Department of Labor, and the conditions of such exemption are otherwise satisfied;

 

  IV. to the extent such acquisition is made on behalf of a Plan by (i) an investment adviser registered under the Investment Advisers Act of 1940 that has as of the last day of its most recent fiscal year total client assets under its management and control in excess of $85 million and had stockholders’ or partners’ equity in excess of $1 million, as shown in its most recent balance sheet prepared in accordance with generally accepted accounting principles, (ii) a bank as defined in Section 202(a)(2) of the Investment Advisers Act of 1940 that has the power to manage, acquire or dispose of assets of a Plan, with equity capital in excess of $1 million as of the last day of its most recent fiscal year, (iii) an insurance company which is qualified under the laws of more than one State to manage, acquire or dispose of any assets of a Plan, which insurance company has, as of the last day of its most recent fiscal year, net worth in excess of $1 million and which is subject to supervision and examination by a State authority having supervision over insurance companies or (iv) a savings and loan association, the accounts of which are insured by the Federal Deposit Insurance Corporation, that has made application for and been granted trust powers to manage, acquire or dispose of assets of a Plan by a State or Federal authority having supervision over savings and loan associations, which savings and loan association has, as of the last day of its most recent fiscal year, equity capital or net worth in excess of $1 million and, in any case, such investment adviser, bank, insurance company or savings and loan is an “independent fiduciary” and is otherwise a qualified professional asset manager, as such terms are used in Prohibited Transaction Class Exemption 84-14 issued by the Department of Labor with respect to such Plan, and the assets of such Plan managed by such investment advisor, bank, insurance company or savings and loan, when combined with the assets of other Plans established or maintained by the same employer (or affiliate thereof, as defined in such exemption) or employee organization and managed by such investment adviser, bank, insurance company or savings and loan do not represent more than 20% of the total client assets managed by such investment adviser, bank, insurance company or savings and loan and the conditions of Part I of such exemption are otherwise satisfied;

 

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  V. to the extent such Plan is not subject to the provisions of Title I of ERISA or Section 4975 of the Code;

 

  VI. to the extent the acquisition is made on behalf of a Plan by an “in-house asset manager,” or INHAM (as defined in Part IV of Prohibited Transaction Class exemption 96-23 issued by the Department of Labor), Plans maintained by affiliates of the INHAM and/or the INHAM have aggregate assets in excess of $250 million, and the conditions of Part I of such exemption are otherwise satisfied; or

 

  VII. to the extent the acquisition by or on behalf of such Plan would not otherwise constitute a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code.

 

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PLAN OF DISTRIBUTION

If you are a broker-dealer who holds unregistered notes for your own account as a result of market-making activities or other trading activities and who receives exchange notes in exchange for your unregistered notes pursuant to the exchange offer, you must acknowledge that you will deliver a prospectus in connection with any resale of your exchange notes. This prospectus, as it may be amended or supplemented from time to time, may be used by you in connection with resales of exchange notes received in exchange for your unregistered notes where your unregistered notes were acquired as a result of market-making activities or other trading activities. We have agreed that, for a period beginning on the date the exchange offer is consummated and ending on the earlier of 180 days after the date of this prospectus and the date on which a broker-dealer is no longer required to deliver a prospectus in connection with market-making activities or other trading activities, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale.

We will not receive any proceeds from any sale of exchange notes by broker-dealers or any other persons. If you are a broker-dealer, exchange notes you receive for your own account pursuant to this exchange offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the exchange notes or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or at negotiated prices. You may make resales directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer or the purchasers of any such exchange notes. If you are a broker-dealer that resells exchange notes that were received by you for your own account pursuant to this exchange offer and you participate in a distribution of the exchange notes, you may be deemed to be an “underwriter” within the meaning of the Securities Act, and any profit on any resale of exchange notes and any commissions or concessions received by you may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that by acknowledging that you will be delivering a prospectus, you will not be deemed to admit that you are an “underwriter” within the meaning of the Securities Act.

We have agreed to pay all expenses incidental to this exchange offer other than commissions or concessions of any broker-dealers and will indemnify the holders of the exchange notes (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act.

 

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LEGAL MATTERS

The validity of the exchange notes and the related guarantees will be passed upon by Latham & Watkins LLP, Washington District of Columbia. Certain legal matters regarding due organization, valid existence and good standing of Pinafore Holdings B.V. and the other guarantors under the laws of their respective jurisdictions, as well as due authorization, execution and delivery of the guarantees contained in the indenture, under the laws of their respective jurisdictions are being passed upon for us by the law firms listed opposite the applicable jurisdiction in the table below:

 

Jurisdiction(s)

   

Law Firm

      
Colorado    Lathrop & Gage LLP   
Indiana    May Oberfell Lorber   
Kentucky, Ohio    Dinsmore & Shohl LLP   
Michigan    Dykema Gossett PLLC   
Tennessee    Baker, Donelson, Bearman, Caldwell & Berkowitz, PC   
Washington    Garvey Schubert Barer   
Australia    Allen & Overy   
Belgium    DLA Piper UK LLP   
Brazil    Pinheiro Neto Advogados   
British Virgin Islands    Walkers   
Canada (Federal); Ontario    Davies Ward Phillips & Vineberg LLP   
England and Wales    Latham & Watkins (London) LLP   
Germany    Latham & Watkins LLP   
The Netherlands    Freshfields Bruckhaus Deringer Amsterdam B.V.   
Luxembourg    Luther Rechtsanwaltsgesellschaft mbH   
Mauritius    Appleby   
Mexico    Ritch Mueller, S.C.   
Northern Ireland    Arthur Cox   
Russia    Latham & Watkins LLP   
Turkey    Hergüner Bilgen Özeke Avukatlik Ortakliği   
United Arab Emirates    Hadef & Partners   

EXPERTS

The consolidated financial statements of Pinafore Holdings B.V. and subsidiaries (the “Company”) as at December 31, 2010 (Successor Company) and as at January 2, 2010 (Predecessor Company) and for the period from September 1, 2010 through December 31, 2010 (Successor Company) and for the period from January 3, 2010 through September 24, 2010, for the 52-week period from January 4, 2009 to January 2, 2010 and for the 53-week period from December 30, 2007 to January 3, 2009 (Predecessor Company), included in this Prospectus have been audited by Deloitte LLP, an independent registered public accounting firm, as stated in their report appearing herein and elsewhere in the Registration Statement. Such financial statements are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

 

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INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS

Audited consolidated financial statements of Pinafore Holdings B.V. as at December 31, 2010

 

Description

    Page

Report of Independent Registered Public Accounting Firm

    F-2

Consolidated Income Statement

    F-3

Consolidated Statement of Comprehensive Income

    F-4

Consolidated Cash Flow Statement

    F-5

Consolidated Balance Sheet

    F-6

Consolidated Statement of Changes in Equity

    F-7

Notes to the Consolidated Financial Statements

    F-10

Unaudited condensed consolidated financial statements of Pinafore Holdings B.V. as at April 2, 2011

 

Description

    Page

Condensed Consolidated Income Statement

    F-98

Condensed Consolidated Statement of Comprehensive Income

    F-99

Condensed Consolidated Cash Flow Statement

    F-100

Condensed Consolidated Balance Sheet

    F-101

Condensed Consolidated Statement of Changes in Equity

    F-102

Notes to the Condensed Consolidated Financial Statements

    F-103

 

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Pinafore Holdings B.V.

 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Pinafore Holdings B.V.

We have audited the accompanying consolidated balance sheets of Pinafore Holdings B.V. and subsidiaries (the ‘Company’) as at December 31, 2010 (Successor Company balance sheet) and as at January 2, 2010 (Predecessor Company balance sheet), and the related consolidated statements of income, comprehensive income, changes in equity and cash flows for the period from September 1, 2010 through December 31, 2010 (Successor Company operations) and for the period from January 3, 2010 through September 24, 2010, for the 52-week period from January 4, 2009 to January 2, 2010 and for the 53-week period from December 30, 2007 to January 3, 2009 (Predecessor Company operations). These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the Successor Company consolidated financial statements present fairly, in all material respects, the financial position of Pinafore Holdings B.V. and subsidiaries as at December 31, 2010 and the results of their operations and their cash flows for the period from September 1, 2010 through December 31, 2010, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Further, in our opinion, the Predecessor Company consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Predecessor Company as at January 2, 2010 and the results of its operations and its cash flows for the period from January 3, 2010 through September 24, 2010, the 52-week period from January 4, 2009 to January 2, 2010 and the 53-week period from December 30, 2007 to January 3, 2009 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

Deloitte LLP

London, United Kingdom

March 30, 2011

 

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Pinafore Holdings B.V.

 

 

CONSOLIDATED INCOME STATEMENT

 

            SUCCESSOR                   PREDECESSOR  
      Note     

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Continuing operations

                    

Sales

      5         1,289.2               3,564.7       4,180.1       5,515.9  

Cost of sales

               (1,038.1 )                        (2,437.7 )      (2,995.9 )      (4,023.7 ) 

Gross profit

         251.1               1,127.0       1,184.2       1,492.2  

Distribution costs

         (144.6 )              (382.4 )      (464.8 )      (584.5 ) 

Administrative expenses

         (230.8 )              (358.2 )      (480.4 )      (513.3 ) 

Transaction costs

      6         (78.2 )              (41.5 )      –        –   

Impairments

      7         –                –        (73.0 )      (342.4 ) 

Restructuring costs

      8         (2.0 )              (10.0 )      (144.1 )      (26.0 ) 

Net gain on disposals and on the exit of businesses

      8         –                6.3       0.2       43.0  

Gain on amendment of post-employment benefits

      9         –                –        63.0       –   

Share of profit/(loss) of associates

      23         0.7                         (1.3 )      (0.4 )      (2.1 ) 

Operating (loss)/profit

               (203.8 )                        339.9       84.7       66.9  
                   

Interest expense

      11         (90.9 )              (71.8 )      (113.2 )      (137.8 ) 

Investment income

      12         18.7               48.2       67.2       87.8  

Other finance expense

      13         (27.1 )              (2.7 )      (0.3 )      (25.0 ) 

Net finance costs

               (99.3 )                        (26.3 )      (46.3 )      (75.0 ) 

(Loss)/profit before tax

         (303.1 )              313.6       38.4       (8.1 ) 

Income tax benefit/(expense)

      14         32.9                         (62.8 )      (28.5 )      (38.4 ) 

(Loss)/profit for the period from continuing operations

         (270.2 )              250.8       9.9       (46.5 ) 
 

Discontinued operations

                    

Loss for the period from discontinued operations

      15         –                          (7.2 )      (3.9 )      –   

(Loss)/profit for the period

      16         (270.2 )              243.6       6.0       (46.5 ) 

Non-controlling interests

               (0.9 )                        (26.2 )      (21.6 )      (18.1 ) 

(Loss)/profit for the period attributable to equity shareholders

               (271.1 )                        217.4       (15.6 )      (64.6 ) 

 

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Pinafore Holdings B.V.

 

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

 

          SUCCESSOR                   PREDECESSOR  
      Note   

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

(Loss)/profit for the period

           (270.2 )                        243.6       6.0       (46.5 ) 

Other comprehensive income/(loss)

                    

Foreign currency translation:

                    

– Currency translation differences on foreign operations:

                    

Subsidiaries

         23.9                7.3       81.5       (211.7 ) 

Associates

         0.3                0.6       0.8       (3.2 ) 

– (Loss)/gain on net investment hedges

         (2.5 )              0.5       (3.1 )      57.2  

– Reclassification to profit or loss of currency translation loss on foreign operations sold

           –                          –        –        6.7  
        21.7                8.4       79.2       (151.0 ) 

Available-for-sale investments:

                    

– Unrealized gain/(loss) recognized in the period

         0.2                (0.1 )      0.4       (1.0 ) 

– Reclassification to profit or loss of gain on investments sold

           –                          –        –        (1.2 ) 
        0.2                (0.1 )      0.4       (2.2 ) 

Post-employment benefits:

                    

– Net actuarial gain/(loss)

         70.1                (31.3 )      (143.8 )      (98.8 ) 

– Effect of the asset ceiling

           (20.2 )                        0.3       18.6       12.3  
            49.9                          (31.0 )      (125.2 )      (86.5 ) 

Other comprehensive income/(loss) before tax

         71.8                (22.7 )      (45.6 )      (239.7 ) 

Income tax (expense)/benefit

    14      (15.9 )                        0.9       26.3       14.3  

Other comprehensive income/(loss) after tax

           55.9                          (21.8 )      (19.3 )      (225.4 ) 

Comprehensive (loss)/income for the period

           (214.3 )                        221.8       (13.3 )      (271.9 ) 
 

Attributable to:

                    

– Equity shareholders in Pinafore Holdings B.V.

         (221.1 )              190.5       (36.8 )      (288.3 ) 

– Non-controlling interests

           6.8                          31.3       23.5       16.4  
            (214.3 )                        221.8       (13.3 )      (271.9 ) 

An analysis of each item of other comprehensive income/(loss) by component of equity is presented in note 40.

 

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Pinafore Holdings B.V.

 

 

CONSOLIDATED CASH FLOW STATEMENT

 

          SUCCESSOR                   PREDECESSOR  
      Note   

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Operating activities

                    

Cash generated from operations

    19      66.3                215.2       532.1       628.7  

Income taxes paid

         (22.3 )              (66.2 )      (50.3 )      (116.3 ) 

Income taxes received

           1.4                          45.7       31.2       31.8  

Net cash inflow from operating activities

           45.4                          194.7       513.0       544.2  

Investing activities

                    

Purchase of property, plant and equipment

         (60.2 )              (90.0 )      (115.2 )      (183.2 ) 

Purchase of computer software

         –                (5.7 )      (7.8 )      (10.6 ) 

Capitalization of development costs

         (2.3 )              (0.5 )      (0.6 )      (0.6 ) 

Disposal of property, plant and equipment

         2.7                24.6       12.9       7.9  

Purchase of available-for-sale investments

         –                –        –        (0.1 ) 

Sale of available-for-sale investments

         –                –        –        1.6  

Investments in associates

         (0.5 )              –        (2.7 )      (10.4 ) 

Purchase of interests in subsidiaries, net of cash acquired

    41      (4,043.9 )              (41.2 )      (26.5 )      (65.0 ) 

Sale of businesses and subsidiaries, net of cash disposed

    42      4.0                (4.0 )      0.7       124.6  

Interest received

         1.4                13.3       3.6       11.2  

Dividends received from associates

           –                          0.5       0.3       0.6  

Net cash outflow from investing activities

           (4,098.8 )                        (103.0 )      (135.3 )      (124.0 ) 

Financing activities

                    

Issue of ordinary shares

         2,142.3                5.5       0.1       0.2  

Draw-down of bank and other loans

         3,150.0                –        2.8       114.6  

Repayment of bank and other loans

         (460.4 )              (0.8 )      (164.4 )      (15.6 ) 

Premium on redemption of notes

         (4.6 )              –        –        –   

(Payments)/receipts on foreign currency derivatives

         (2.2 )              (20.3 )      39.6       (178.6 ) 

Settlement of interest rate swaps

         –                64.7       –        –   

Capital element of finance lease rental payments

         (0.2 )              (0.7 )      (2.8 )      (2.8 ) 

Interest element of finance lease rental payments

         –                (0.2 )      (0.4 )      (0.5 ) 

(Increase)/decrease in collateralized cash

         (44.9 )              –        2.1       0.7  

Purchase of own shares

         –                (6.2 )      (1.4 )      (4.7 ) 

Interest paid

         (58.1 )              (15.2 )      (37.5 )      (55.0 ) 

Financing costs paid

         (182.4 )              –        (6.3 )      –   

Equity dividend paid

         –                (56.9 )      (48.3 )      (246.2 ) 

Investment by a minority shareholder in a subsidiary

         11.7                –        4.7       0.4  

Dividend paid to a minority shareholder in a subsidiary

           –                          (12.0 )      (8.7 )      (13.5 ) 

Net cash inflow/(outflow) from financing activities

           4,551.2                          (42.1 )      (220.5 )      (401.0 ) 

Increase in net cash and cash equivalents

         497.8                49.6       157.2       19.2  

Net cash and cash equivalents at the beginning of the period

         –                440.2       278.2       280.2  

Foreign currency translation

           (45.6 )                        1.3       4.8       (21.2 ) 

Net cash and cash equivalents at the end of the period

           452.2                          491.1       440.2       278.2  

Analysis of net cash and cash equivalents:

 

       SUCCESSOR                     PREDECESSOR  
       

As at

December 31,

2010

$ million

                      

As at

January 2,

2010

$ million

     

As at

January 3,

2009

$ million

  

Cash and cash equivalents

        459.3                 445.0        291.9  

Bank overdrafts

        (7.1 )                          (4.8 )       (13.7 ) 
         452.2                           440.2        278.2  

 

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Pinafore Holdings B.V.

 

 

CONSOLIDATED BALANCE SHEET

 

          SUCCESSOR                   PREDECESSOR  
      Note   

As at

December 31,

2010

$ million

                    

As at

January 2,

2010

$ million

  

Non-current assets

                

Goodwill

    20      1,745.4                436.0  

Other intangible assets

    21      2,268.5                78.0  

Property, plant and equipment

    22      1,359.1                1,122.8  

Investments in associates

    23      23.6                20.6  

Trade and other receivables

    25      26.2                81.1  

Deferred tax assets

    37      9.6                82.9  

Post-employment benefit surpluses

    35      3.6                          1.3  
            5,436.0                          1,822.7  

Current assets

                

Inventories

    24      693.5                590.8  

Trade and other receivables

    25      914.5                753.0  

Income tax recoverable

         11.0                49.0  

Available-for-sale investments

    27      1.4                1.2  

Cash and cash equivalents

    28      459.3                          445.0  
            2,079.7                          1,839.0  

Assets held for sale

    29      36.6                          11.9  

Total assets

           7,552.3                          3,673.6  

Current liabilities

                

Bank overdrafts

    30      (7.1 )              (4.8 ) 

Bank and other loans

    30      (255.7 )              (11.2 ) 

Obligations under finance leases

    31      (0.5 )              (1.0 ) 

Trade and other payables

    32      (704.4 )              (677.6 ) 

Income tax liabilities

         (106.8 )              (94.7 ) 

Provisions

    38      (65.6 )                        (100.3 ) 
            (1,140.1 )                        (889.6 ) 

Non-current liabilities

                

Bank and other loans

    30      (2,898.9 )              (687.3 ) 

Obligations under finance leases

    31      (2.8 )              (3.6 ) 

Trade and other payables

    32      (65.4 )              (27.1 ) 

Post-employment benefit obligations

    35      (279.2 )              (343.5 ) 

Deferred tax liabilities

    37      (793.3 )              (25.3 ) 

Income tax liabilities

         –                –   

Provisions

    38      (24.7 )                        (19.2 ) 
            (4,064.3 )                        (1,106.0 ) 

Liabilities directly associated with assets held for sale

           (8.1 )                        –   

Total liabilities

           (5,212.5 )                        (1,995.6 ) 

Net assets

           2,339.8                          1,678.0  

Capital and reserves

                

Share capital

    39      –                79.6  

Shares to be issued

    39      17.6                –   

Share premium account

    39      2,124.7                799.2  

Own shares

    39      –                (8.2 ) 

Capital redemption reserve

    39      –                921.8  

Currency translation reserve

         16.2                (93.0 ) 

Available-for-sale reserve

         –                (0.9 ) 

Accumulated deficit

           (130.2 )                        (161.9 ) 

Shareholders’ equity

         2,028.3                1,536.6  

Non-controlling interests

           311.5                          141.4  

Total equity

           2,339.8                          1,678.0  

The consolidated financial statements were approved by the Board of Directors on March 30, 2011.

 

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Table of Contents

Pinafore Holdings B.V.

 

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

SUCCESSOR

 

     

Share
capital

(note 39)

$ million

     

Shares
to be
issued

(note 39)

$ million

     

Share

premium

account

(note 39)

$ million

     

Currency

translation

reserve

$ million

     

Accumulated
deficit

$ million

    

Total

shareholders’

equity

$ million

    

Non-

controlling

interests

$ million

     

Total

equity

$ million

  

As at September 25, 2010

      –         –         –         –         –        –        –         –   

Q4 2010

                      

(Loss)/profit for the period

      –         –         –         –         (271.1 )      (271.1 )      0.9        (270.2 ) 

Other comprehensive income

      –         –         –         16.2        33.8       50.0       5.9        55.9  

Total comprehensive (loss)/income

      –         –         –         16.2        (237.3 )      (221.1 )      6.8        (214.3 ) 

Other changes in shareholders’ equity:

                      

– Issue of ordinary shares

      –         –         2,124.7        –         –        2,124.7       –         2,124.7  

– Acquisition of subsidiaries

      –         –         –         –         –        –        304.5        304.5  

– Subscription by management

      –         17.6        –         –         –        17.6        –         17.6   

– Share-based incentives

      –         –         –         –         107.1       107.1       0.2        107.3  
       –         17.6        2,124.7        –         107.1       2,249.4       304.7        2,554.1  

As at December 31, 2010

      –         17.6         2,124.7         16.2         (130.2 )      2,028.3        311.5         2,339.8   

An analysis of each item of other comprehensive income/(loss) by component of equity is presented in note 40.

 

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Pinafore Holdings B.V.

 

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

PREDECESSOR

 

     

Ordinary

share

capital

(note 39)

$ million

    

Cancellation
reserve

$ million

    

Share

premium

account

(note 39)

$ million

    

Deferred

shares

(note 39)

$ million

    

Own

shares

(note 39)

$ million

  

As at December 29, 2007

      65.5       –        679.4       –        (18.9 ) 

Fiscal 2008

           

(Loss)/profit for the period

      –        –        –        –        –   

Other comprehensive loss

      –        –        –        –        –   

Total comprehensive (loss)/income

      –        –        –        –        –   

Other changes in shareholders’ equity:

           

– Transfer of currency translation difference on change of functional currency

      22.6       –        112.4       –        (3.4 ) 

– Issue of ordinary shares before redenomination

      –        –        0.2       –        –   

– Redenomination of ordinary shares:

           

Cancellation of ordinary shares of 5p each

      (88.1 )      88.1       –        –        –   

Currency translation difference on redenomination

      –        (1.3 )      –        –        –   

Issue of deferred shares of £1 each

      –        –        (0.1 )      0.1       –   

Issue of ordinary shares of 9c each

      79.6       (79.6 )      –        –        –   

Transfer to the share premium account

      –        (7.2 )      7.2       –        –   
     (8.5 )      –        7.1       0.1       –   

– Dividends paid on ordinary shares

      –        –        –        –        –   

– Purchase of own shares

      –        –        –        –        (4.7 ) 

– Transfer of own shares

      –        –        –        –        12.1  

– Share-based incentives

      –        –        –        –        –   

– Dividends paid to minority shareholders

      –        –        –        –        –   

– Shares issued by a subsidiary to minority shareholders

      –        –        –        –        –   

– Non-controlling interest on acquisition of a subsidiary

      –        –        –        –        –   

As at January 3, 2009

      79.6       –        799.1       0.1       (14.9 ) 

Fiscal 2009

           

Profit/(loss) for the period

      –        –        –        –        –   

Other comprehensive (loss)/income

      –        –        –        –        –   

Total comprehensive (loss)/income

      –        –        –        –        –   

Other changes in equity:

           

– Cancellation of deferred shares

      –        –        –        (0.1 )      –   

– Issue of ordinary shares

      –        –        0.1       –        –   

– Dividends paid on ordinary shares

      –        –        –        –        –   

– Purchase of own shares

      –        –        –        –        (1.4 ) 

– Transfer of own shares

      –        –        –        –        8.1  

– Share-based incentives (including a tax benefit of $0.9 million)

      –        –        –        –        –   

– Dividends paid to minority shareholders

      –        –        –        –        –   

– Purchase of a non-controlling interest

      –        –        –        –        –   

– Shares issued by a subsidiary to minority shareholders

      –        –        –        –        –   

As at January 2, 2010

      79.6       –        799.2       –        (8.2 ) 

9M 2010

           

Profit for the period

      –        –        –        –        –   

Other comprehensive (loss)/income

      –        –        –        –        –   

Total comprehensive income/(loss)

      –        –        –        –        –   

Other changes in equity:

           

– Issue of ordinary shares

      0.3       –        15.1       –        –   

– Dividends paid on ordinary shares

      –        –        –        –        –   

– Purchase of own shares

      –        –        –        –        (6.2 ) 

– Transfer of own shares

      –        –        –        –        14.4  

– Share-based incentives (including a tax benefit of $5.2 million)

      –        –        –        –        –   

– Dividends paid to minority shareholders

      –        –        –        –        –   

As at September 24, 2010

      79.9       –        814.3       –        –   

An analysis of each item of other comprehensive income/(loss) by component of equity is presented in note 40.

 

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Pinafore Holdings B.V.

 

 

 

Capital

redemption

reserve

(note 39)

$ million

     

Currency

translation

reserve

$ million

    

Available-for-

sale reserve

$ million

    

Retained profit /

(accumulated
deficit)

$ million

    

Total

shareholders’

equity

$ million

    

Non-controlling

interests

$ million

    

Total

equity

$ million

  
  718.8        313.7       (0.2 )      379.5       2,137.8       117.0       2,254.8  
            
  –         –        –        (64.6 )      (64.6 )      18.1       (46.5 ) 
  –         (150.1 )      (0.8 )      (72.8 )      (223.7 )      (1.7 )      (225.4 ) 
  –         (150.1 )      (0.8 )      (137.4 )      (288.3 )      16.4       (271.9 ) 
            

 

202.9

 

      (334.5 )      –        –        –        –        –   
  –         –        –        –        0.2       –        0.2  
            
  –         –        –        –        –        –        –   
  –         1.3       –        –        –        –        –   
  –         –        –        –        –        –        –   
  –         –        –        –        –        –        –   
  –         –        –        –        –        –        –   
  –         1.3       –        –        –        –        –   
  –         –        –        (246.2 )      (246.2 )      –        (246.2 ) 
  –         –        –        –        (4.7 )      –        (4.7 ) 
  –         –        –        (12.1 )      –        –        –   
  –         –        –        12.0       12.0       –        12.0  
  –         –        –        –        –        (13.5 )      (13.5 ) 
  –         –        –        –        –        0.4       0.4  
  –         –        –        –        –        8.2       8.2  
  921.7        (169.6 )      (1.0 )      (4.2 )      1,610.8       128.5       1,739.3  
            
  –         –        –        (15.6 )      (15.6 )      21.6       6.0  
  –         76.6       0.1       (97.9 )      (21.2 )      1.9       (19.3 ) 
  –         76.6       0.1       (113.5 )      (36.8 )      23.5       (13.3 ) 
            
  0.1        –        –        –        –        –        –   
  –         –        –        –        0.1       –        0.1  
  –         –        –        (48.3 )      (48.3 )      –        (48.3 ) 
  –         –        –        –        (1.4 )      –        (1.4 ) 
  –         –        –        (8.1 )      –        –        –   
  –         –        –        12.2       12.2       –        12.2  
  –         –        –        –        –        (8.7 )      (8.7 ) 
  –         –        –        –        –        (6.6 )      (6.6 ) 
  –         –        –        –        –        4.7       4.7  
  921.8        (93.0 )      (0.9 )      (161.9 )      1,536.6       141.4       1,678.0  
            
  –         –        –        217.4       217.4       26.2       243.6  
  –         3.1       (0.1 )      (29.9 )      (26.9 )      5.1       (21.8 ) 
  –         3.1       (0.1 )      187.5       190.5       31.3       221.8  
            
  –         –        –        –        15.4       –        15.4  
  –         –        –        (56.9 )      (56.9 )      –        (56.9 ) 
  –         –        –        –        (6.2 )      –        (6.2 ) 
  –         –        –        (14.4 )      –        –        –   
  –         –        –        26.4       26.4       –        26.4  
  –         –        –        –        –        (12.0 )      (12.0 ) 
  921.8        (89.9 )      (1.0 )      (19.3 )      1,705.8       160.7       1,866.5  

 

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Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

1. Incorporation of the Company and acquisition of Tomkins

Pinafore Holdings B.V. (‘the Company’ or ‘the Successor’) was incorporated on September 1, 2010 in and under the laws of The Netherlands.

The Company’s immediate and ultimate parent entity is Pinafore Coöperatief U.A. (‘the Co-operative’), which also operates in and under the laws of The Netherlands. The Co-operative is owned by a consortium representing the interests of Onex Corporation (‘Onex’), a Canadian private equity investor, Onex Partners III and various syndication participants, and the Canada Pension Plan Investment Board (‘CPPIB’).

On September 24, 2010, Tomkins Acquisitions Limited (formerly Pinafore Acquisitions Limited), a wholly-owned subsidiary of the Company that is incorporated in and under the laws of the United Kingdom, acquired the entire issued ordinary share capital of Tomkins plc (‘the Predecessor’).

Tomkins plc is incorporated in and under the laws of the United Kingdom. On the acquisition date, Tomkins plc was re-registered as a private company and its name was changed to Tomkins Limited.

Further information on the acquisition of the group headed by Tomkins Limited (‘Tomkins’) is presented in note 41.

References in these consolidated financial statements to ‘the Group’ refer, in the periods prior to the acquisition of Tomkins, to Tomkins Limited and its subsidiaries and, in the period subsequent to the acquisition of Tomkins, to the Company and its subsidiaries.

 

2. Nature of operations

As a consequence of the acquisition of Tomkins, the Group comprises a global engineering and manufacturing business.

The Group is organized for management reporting purposes into two business groups: Industrial & Automotive and Building Products. Within these two business groups, management distinguishes between those of the Group’s operating segments that are ongoing and those that have been exited but do not meet the conditions to be classified as discontinued operations.

Industrial & Automotive manufactures a wide range of systems and components for the industrial equipment, car and truck manufacturing markets, and industrial and automotive aftermarkets throughout the world. Industrial & Automotive is comprised of four ongoing operating segments: Power Transmission, Fluid Power, Sensors & Valves and Other Industrial & Automotive.

Building Products is comprised of two ongoing operating segments: Air Distribution and Bathware. Air Distribution

supplies the industrial and residential heating, ventilation and air conditioning market, mainly in North America. Bathware manufactures baths and whirlpools for the residential, and hotel and resort development markets, mainly in North America.

 

3. Principal accounting policies

A. Basis of preparation

The consolidated financial statements have been prepared on a going concern basis in accordance with International Financial Reporting Standards (‘IFRSs’) adopted for use in the European Union and, except as described under the heading ‘Financial instruments’, under the historical cost convention.

From the Group’s perspective, there are no applicable differences between IFRS adopted for use in the European Union and IFRS as issued by the International Accounting Standards Board (‘IASB’) and, therefore, the financial statements also comply with IFRSs as issued by the IASB.

During the period, the Group adopted early the Amendments to IAS 24 ‘Related Party Disclosures’ and the Amendments to IFRIC 14 ‘IAS19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction’ that were issued by the IASB in November 2009. Adoption of these pronouncements had no impact on the Group’s results or financial position.

B. Accounting periods

Financial statements are presented for the periods preceding and succeeding the acquisition of Tomkins.

The financial statements for the periods preceding the acquisition of Tomkins, the Predecessor financial statements, comprise the consolidated financial statements of Tomkins Limited. Prior to the acquisition, Tomkins drew up its annual financial statements to the Saturday nearest December 31. Accordingly, Predecessor financial statements are presented for the 53-week period from December 30, 2007 to January 3, 2009 (‘Fiscal 2008’), the 52-week period from January 4, 2009 to January 2, 2010 (‘Fiscal 2009’) and the 38-week period from January 3, 2010 to September 24, 2010 (‘9M 2010’). The Predecessor financial statements do not reflect the effects of the accounting for the acquisition of Tomkins.

The financial statements for the period succeeding the acquisition, the Successor financial statements, comprise the Company’s consolidated financial statements. The Company draws up its annual financial statements to December 31. Although the Company was incorporated on September 1, 2010, it had no assets or liabilities

(other than the proceeds of the ordinary shares issued on incorporation) and no operations prior to the acquisition of Tomkins. Accordingly, the Successor financial statements

 

 

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

3. Principal accounting policies continued

 

B. Accounting periods (continued)

 

present the results of the Successor’s operations for the 14-week period from September 25, 2010 to December 31, 2010 (‘Q4 2010’).

C. Basis of consolidation

The consolidated financial statements include the results, cash flows and assets and liabilities of the Company and its subsidiaries, and the Group’s share of the results and net assets of its associates.

A subsidiary is an entity controlled, either directly or indirectly, by the Company, where control is the power to govern the financial and operating policies of the entity so as to obtain benefit from its activities. The results of a subsidiary acquired during the period are included in the Group’s results from the effective date of acquisition. The results of a subsidiary sold during the period are included in the Group’s results up to the effective date of disposal.

Intra-Group transactions and balances, and any unrealized profits or losses arising from intra-Group transactions, are eliminated on consolidation.

D. Associates

An associate is an entity over which the Company, either directly or indirectly, is in a position to exercise significant influence by participating in, but not controlling or jointly controlling, the financial and operating policies of the entity.

Associates are accounted for using the equity method whereby the investments in associates are carried in the balance sheet at cost as adjusted for changes in the Group’s share of the net assets of the associate, less any recognized impairment. Profits or losses recognized by the Company or its subsidiaries on transactions with an associate are eliminated to the extent of the Group’s interest in the associate concerned.

Losses of an associate in excess of the Group’s interest in the entity are not recognized, except to the extent that the Group has incurred obligations on behalf of the entity.

E. Foreign currency translation

At entity level, transactions denominated in foreign currencies are translated into the entity’s functional currency at the exchange rate ruling on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the exchange rate ruling on the balance sheet date. Currency translation differences arising at entity level are recognized in profit or loss.

On consolidation, the results of foreign operations are translated into the Group’s presentation currency at the average exchange rate for the period and their assets and liabilities are translated into the Group’s presentation

currency at the exchange rate ruling on the balance sheet date. Currency translation differences arising on consolidation are recognized in other comprehensive income and taken to the currency translation reserve.

In the event that a foreign operation is sold, the gain or loss on disposal recognized in profit or loss is determined after taking into account the cumulative currency translation differences arising on consolidation of the operation.

In the cash flow statement, the cash flows of foreign operations are translated into the Group’s presentation currency at the average exchange rate for the period.

F. Revenue

Revenue from the sale of goods is measured at the invoiced amount net of returns, early settlement discounts, rebates and sales taxes and is recognized only where there is persuasive evidence of a sales agreement, the delivery of goods has occurred and, where there are contractual acceptance provisions, the customer has accepted the goods (or the right to reject them has lapsed), the sale price is fixed or determinable and the collectability of revenue is reasonably assured.

Where a customer has the right to return unwanted goods, future returns are estimated based on historical returns profiles. Settlement discounts that may apply to unpaid invoices are estimated based on the settlement histories of the relevant customers. Rebates that may apply to issued invoices are estimated based on expected total qualifying sales to the relevant customers.

Interest income is accrued on a time basis using the effective interest method.

Dividend income is recognized when payment is received.

G. Restructuring initiatives

Restructuring initiatives comprise expenses incurred in major projects undertaken to rationalize and improve the cost competitiveness of the Group and consequential gains and losses arising on the disposal or exit of businesses or on the disposal of assets.

H. Borrowing costs

Borrowing costs directly attributable to the construction of a production, distribution or administration facility are capitalized as part of the cost of the facility if, at the outset of construction, the facility was expected to take more than 12 months to get ready for its intended use.

All other borrowing costs are recognized in profit or loss in the period in which they are incurred.

I. Business combinations

 

(i) Background

Effective January 3, 2010, the Group adopted IFRS 3 (Revised 2008) ‘Business Combinations’, IAS 27 (Revised

 

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Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

3. Principal accounting policies continued

 

I. Business combinations (continued)

 

2008) ‘Consolidated and Separate Financial Statements’, which contained a number of changes that affected the accounting for business combinations and subsequent changes in the Group’s ownership interest in a subsidiary. The revised standards were applied prospectively to business combinations with an effective date of acquisition on or after January 3, 2010.

 

(ii) Businesses acquired before January 3, 2010

Business combinations were accounted for using the purchase method.

Goodwill arising in a business combination was measured as the excess of the cost of acquisition over the interest acquired by the Group in the fair value of the identifiable assets, liabilities and contingent liabilities of the acquired business that were recognized at the acquisition date. Where the interest acquired by the Group in the fair value of the identifiable assets, liabilities and contingent liabilities that were recognized exceeded the cost of acquisition, the excess was recognized as a gain in profit or loss.

The cost of acquisition comprised the aggregate of the fair values of the assets given, liabilities incurred or assumed and equity instruments issued by the Group in exchange for control over the acquired business and any costs directly attributable to the business combination.

The identifiable assets, liabilities and contingent liabilities of the acquired business that were recognized were measured at their fair value at the acquisition date, except for assets that were classified as held for sale, which were measured at fair value less costs to sell.

Any non-controlling interests were initially measured at their share of the identifiable assets, liabilities and contingent liabilities of the acquired business that were recognized at the acquisition date.

If the initial accounting for a business combination was incomplete by the end of the reporting period in which the combination occurred, the Group reported provisional amounts for the items for which the accounting was incomplete. If, within a maximum of one year after the acquisition date, new information was obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date, adjustments were made to the amounts recognized, or new assets and liabilities recognized, as at the acquisition date. Otherwise, with the exception of adjustments to contingent consideration and the recognition of previously unrecognized deferred tax assets of the acquired business, adjustments to the provisional amounts were recognized in profit or loss.

 

Subsequent adjustments to the estimated amount of contingent consideration were recognized as adjustments to the cost of acquisition.

Where deferred tax assets of the acquired business at the acquisition date were not initially recognized but were subsequently recognized, the income tax benefit was recognized as income but, in addition, the Group reduced the carrying amount of goodwill recognized on the acquisition and recognized the reduction in the carrying amount of goodwill as an expense in profit or loss.

Where a business combination was achieved in stages, the Group treated each exchange transaction separately and applied the purchase method at the date of each exchange transaction.

Where the Group sold an interest in a subsidiary, the difference between the consideration received and the carrying amount of the interest in the subsidiary that was sold was recognized in profit or loss.

 

(iii) Businesses acquired on or after January 3, 2010

A business combination is a transaction or other event in which the Group obtains control of one or more businesses.

Business combinations are accounted for using the acquisition method.

Goodwill arising in a business combination is measured as the excess of the aggregate of the consideration transferred, the amount of any non-controlling interest in the acquired business and, in a business combination achieved in stages, the fair value at the acquisition date of the Group’s previously held equity interest in the acquired business, over the identifiable assets and liabilities of the acquired business at the acquisition date. If the identifiable assets and liabilities of the acquired business exceed the aggregate of the consideration transferred, the amount of any non-controlling interest in the acquired business and the fair value at the acquisition date of any previously held equity interest, that excess is recognized as a gain in profit or loss.

Consideration transferred in a business combination is measured at the aggregate of the fair values of the assets given, liabilities incurred or assumed and equity instruments issued by the Group in exchange for control over the acquired business. Acquisition-related costs are recognized in profit or loss as incurred.

Any non-controlling interests in the acquired business are measured either at fair value or at the non-controlling interest’s proportionate share of the identifiable assets and liabilities of the acquired business.

Identifiable assets and liabilities of the acquired business are measured at their fair value at the acquisition date,

 

F-12

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

3. Principal accounting policies continued

 

I. Business combinations (continued)

 

except for the following that are measured in accordance with the relevant Group accounting policy:

 

- pensions and other post-employment benefit arrangements;

 

- equity instruments related to the replacement of share-based incentives awarded to employees of the acquired business;

 

- deferred tax assets and liabilities of the acquired business; and

 

- assets classified as held for sale.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. If, within a maximum of one year after the acquisition date, new information is obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date, adjustments are made to the amounts recognized, or new assets and liabilities recognized, as at the acquisition date. Otherwise, any adjustments to the provisional amounts are recognized in profit or loss.

When a business combination is achieved in stages, the Group’s previously held interests in the acquired business are remeasured to their fair value when the Group obtains control of the acquired business and the resulting gain or loss, if any, is recognized in profit or loss.

Changes in the Group’s ownership interest in a subsidiary that do not result in a loss of control are accounted for within equity. In such circumstances, the carrying amounts of equity attributable to the shareholders of the Company and to non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to the shareholders of the Company.

If the Group loses control of a subsidiary, it derecognizes the assets and liabilities and related equity components of the former subsidiary and measures any investment retained in the former subsidiary at its fair value at the date when control is lost. Any gain or loss is recognized in profit or loss.

J. Goodwill

Goodwill arising in a business combination is recognized as an intangible asset and is allocated to the CGU or group of CGUs that are expected to benefit from the synergies of the acquisition.

Where a number of CGUs or groups of CGUs are acquired in a business combination, the goodwill attributable to each of them is determined by allocating the purchase consideration in proportion to their respective business enterprise values and comparing the allocated purchase consideration with the fair value of the identifiable assets and liabilities of the CGU or group of CGUs.

Goodwill is not amortized but is tested at least annually for impairment and carried at cost less any recognized impairment.

K. Other intangible assets

Other intangible assets are stated at cost less accumulated amortization and any recognized impairment losses.

 

(i) Assets acquired in business combinations

An intangible resource acquired in a business combination is recognized as an intangible asset if it is separable from the acquired business or arises from contractual or legal rights. An acquired intangible asset with a definite useful life is amortized on a straight-line basis so as to charge its cost, which represents its fair value at the date of acquisition, to profit or loss over its expected useful life, as follows:

 

Customer relationships

    16 to 19 years

Technology and know how

    7 to 9 years

Acquired brands and trade names are considered to have an indefinite useful life and are not amortized but are tested at least annually for impairment and carried at cost less any recognized impairment.

 

(ii) Product development costs

All research expenditure is charged to profit or loss in the period in which it is incurred.

Development expenditure is charged to profit or loss in the period in which it is incurred unless it relates to the development of a new or significantly improved product, it is incurred after the technical feasibility of the product has been proven, and customer orders have been received that are expected to provide income sufficient to cover the further development expenditure that will be incurred prior to the product going into full production. Capitalized development expenditure is amortized on a straight-line basis such that it is charged to profit or loss over the expected life of the resulting product.

 

(iii) Computer software

Computer software that is not integral to an item of property, plant and equipment is recognized separately as an intangible asset. Amortization is provided on a straight-line basis so as to charge the cost of the software to profit or loss over its expected useful life, which is in the range 3 to 5 years.

 

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

3. Principal accounting policies continued

 

L. Property, plant and equipment

Property, plant and equipment is stated at cost less accumulated depreciation and any recognized impairment losses.

Freehold land and assets under construction are not depreciated. Depreciation of property, plant and equipment, other than freehold land and assets under construction, is generally provided on a straight-line basis so as to charge the depreciable amount to profit or loss over the useful life of the asset as follows:

 

Freehold buildings and long-leasehold property

    50 years

Short-leasehold property

    Length of lease

Plant, equipment and vehicles

    2 to 40 years

Property, plant and equipment acquired in a business combination is depreciated so as to charge the depreciable amount, which represents its fair value at the date of acquisition less expected residual value, to profit or loss over the remaining useful life of the asset.

M. Leases

Leases that confer rights and obligations similar to those that attach to owned assets are classified as finance leases. All other leases are classified as operating leases.

Assets held under finance leases are included within property, plant and equipment, initially measured at their fair value or, if lower, the present value of the minimum lease payments, and a corresponding liability is recognized within obligations under finance leases. Subsequently, the assets are depreciated on a basis consistent with similar owned assets or over the term of the lease, if shorter. At inception of the lease, the lease rentals are apportioned between an interest element and a capital element so as to produce a constant periodic rate of interest on the outstanding liability. Thereafter, the interest element is recognized as an expense in profit or loss while the capital element is applied to reduce the outstanding liability.

Operating lease payments, and any incentives receivable, are recognized in profit or loss on a straight-line basis over the term of the lease.

N. Impairment of long-lived assets

Goodwill, other intangible assets and property, plant and equipment are tested for impairment whenever events or circumstances indicate that their carrying amounts might be impaired. Additionally, goodwill, other intangible assets considered to have an indefinite useful life and any capitalized development expenditure relating to a product that is not yet in full production are subject to an annual impairment test.

An asset is impaired to the extent that its carrying amount exceeds its recoverable amount, which represents the higher of the asset’s value in use and its fair value less costs to sell. An asset’s value in use represents the present value of the future cash flows expected to be derived from the continued use of the asset. Fair value less costs to sell is the amount obtainable from the sale of the asset in an arm’s length transaction between knowledgeable, willing parties, less the costs of disposal.

Where it is not possible to estimate the recoverable amount of an individual asset, the recoverable amount is determined for the CGU to which the asset belongs. An asset’s CGU is the smallest group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. Goodwill does not generate cash flows independently of other assets and is, therefore, tested for impairment at the level of the CGU or group of CGUs to which it is allocated.

Where appropriate, impairment of long-lived assets other than goodwill is recognized before goodwill is tested for impairment. When goodwill is tested for impairment and the carrying amount of the CGU or group of CGUs to which the goodwill has been allocated exceeds its recoverable amount, the impairment is allocated first to reduce the carrying amount of the goodwill and then to the other long-lived assets belonging to the CGU or group of CGUs pro-rata on the basis of their carrying amounts.

Impairments are recognized in profit or loss. Impairments recognized in previous periods for long-lived assets other than goodwill are reversed if there has been a change in the estimates used to determine the asset’s recoverable amount, but only to the extent that the carrying amount of the asset does not exceed its carrying amount had no impairment been recognized in previous periods. Impairments recognized in respect of goodwill are not reversed.

O. Inventories

Inventories are valued at the lower of cost and net realizable value, with due allowance for any excess, obsolete or slow-moving items. Cost represents the expenditure incurred in bringing inventories to their existing location and condition, which may include the cost of raw materials, direct labor costs, other direct costs and related production overheads. Cost is generally determined on a first in, first out basis. Net realizable value is the estimated selling price less costs to complete and sell.

P. Grants

Grants received relating to property, plant and equipment are treated as deferred income and recognized in profit or loss in equal installments over the expected useful life of

 

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

3. Principal accounting policies continued

 

P. Grants (continued)

 

the asset concerned. Other grants received are recognized in profit or loss on a systematic basis so as to match them with the costs they are intended to compensate or, if those costs have already been recognized, the grants are recognized in profit or loss in the period in which they are received.

Q. Financial instruments

 

(i) Investments

Listed investments are classified as available-for-sale and are measured at fair value. Changes in their fair values are recognized in other comprehensive income and taken to the available-for-sale reserve, except to the extent that they represent an other than temporary impairment in which case the impairment is recognized in profit or loss. In the event that such an investment is sold, the realized gain or loss is transferred from other comprehensive income to profit or loss.

 

(ii) Trade receivables

Trade receivables represent the amount of sales of goods to customers for which payment has not been received, less an allowance for doubtful accounts that is estimated based on factors such as the credit rating of the customer, historical trends, the current economic environment and other information.

 

(iii) Cash and cash equivalents

Cash and cash equivalents comprise cash in hand, deposits available on demand and other short-term, highly-liquid investments with a maturity on acquisition of three months or less, and bank overdrafts. Bank overdrafts are presented as current liabilities to the extent that there is no right of offset with cash balances.

 

(iv) Trade payables

Trade payables represent the amount of invoices received from suppliers for purchases of goods and services for which payment has not been made.

 

(v) Bank and other loans

Bank and other loans are initially measured at fair value, net of directly attributable transaction costs, if any, and are subsequently measured at amortized cost using the effective interest rate method.

 

(vi) Derivative financial instruments

From time to time, the Group uses derivative financial instruments, principally foreign currency swaps, forward foreign currency contracts and interest rate swaps, to reduce its exposure to exchange rate and interest rate movements. The Group does not hold or issue derivatives for speculative purposes.

Derivative financial instruments are recognized as assets and liabilities measured at their fair values at the balance

sheet date. Changes in their fair values are recognized in profit or loss and this is likely to cause volatility in situations where the carrying value of the hedged item is not normally adjusted to reflect fair value changes arising from the hedged risk or is so adjusted but that adjustment is not recognized in profit or loss. Provided the conditions specified by IAS 39 ‘Financial Instruments: Recognition and Measurement’ are met, hedge accounting may be used to mitigate this volatility.

The Group does not generally apply hedge accounting to transactional foreign currency hedging relationships, such as hedges of forecast or committed transactions. It does, however, apply hedge accounting to translational foreign currency hedging relationships and to hedges of its interest rate exposures where it is permissible to do so under IAS 39. When hedge accounting is used, the relevant hedging relationships are classified as a fair value hedge, a cash flow hedge or, in the case of a hedge of the Group’s net investment in a foreign operation, a net investment hedge.

Where the hedging relationship is classified as a fair value hedge, the carrying amount of the hedged asset or liability is adjusted by the change in its fair value attributable to the hedged risk and the resulting gain or loss is recognized in profit or loss where, to the extent that the hedge is effective, it offsets the change in the fair value of the hedging instrument.

Where the hedging relationship is classified as a cash flow hedge or as a net investment hedge, to the extent the hedge is effective, the change in the fair value of the hedging instrument attributable to the hedged risk is recognized in other comprehensive income rather than in profit or loss. When the hedged item in a cash flow hedge is recognized in the financial statements, the accumulated gain or loss recognized in other comprehensive income is either transferred to profit or loss or, if the hedged item results in a non-financial asset, is recognized as an adjustment to the asset’s initial carrying amount. In the event that a foreign operation that is designated as a hedged item in a net investment hedge is sold, the accumulated currency translation gain or loss on the hedging instrument that is recognized in other comprehensive income is transferred to profit or loss and included in the gain or loss on disposal of the foreign operation.

Derivative financial instruments are classed as current assets or liabilities unless they are in a designated hedging relationship and the hedged item is classified as a non-current asset or liability.

Derivative financial instruments that are not in a designated hedging relationship are classified as held for trading.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

3. Principal accounting policies continued

 

Q. Financial instruments (continued)

 

(vii) Contracts to buy or sell non-financial items

From time to time, the Group enters into forward contracts to fix the price of energy and raw materials purchased for use in its manufacturing operations. Such contracts fall outside the scope of IAS 39, provided that they were entered into and continue to be held for the purpose of receipt or delivery in accordance with the Group’s expected purchase, sale or usage requirements. Where these conditions are not met, the contracts are classified and accounted for in the same way as derivative financial instruments.

 

(viii) Embedded derivatives

A derivative embedded in a non-derivative hybrid contract is separated from the host contract when its risks and characteristics are not closely related to those of the host contract and the hybrid contract is not measured at fair value with changes in fair value recognized in profit or loss. An embedded derivative that is separated from its host contract is presented as a separate asset or liability measured at fair value with changes in fair value recognized in profit or loss and is classed as a current or non-current asset or liability based on the cash flows of the hybrid contract.

R. Post-employment benefits

Post-employment benefits comprise pension benefits provided to employees throughout the world and other benefits, mainly healthcare, provided to certain employees in North America.

For defined contribution plans, the cost of providing the benefits represents the Group’s contributions to the plans and is recognized in profit or loss in the period in which the contributions fall due.

For defined benefit plans, the cost of providing the benefits is determined based on actuarial valuations of each of the plans that are carried out annually at the Group’s balance sheet date by independent, qualified actuaries. Plan assets are measured at their fair value at the balance sheet date. Benefit obligations are measured on an actuarial basis using the projected unit credit method.

The cost of defined benefit plans recognized in profit or loss comprises the net total of the current service cost, the past service cost, the expected return on plan assets, the interest cost and the effect of any curtailments or settlements. The current service cost represents the increase in the present value of the plan liabilities expected to arise from employee service in the current period. The past service cost is the change in the benefit obligation that results from changes in the benefits payable in respect of employee service in prior periods.

The past service cost may be either positive or negative and is recognized in profit or loss on a straight-line basis over the vesting period, or immediately if the benefits have vested.

The expected return on plan assets is based on market expectations at the beginning of the period of future returns over the life of the benefit obligation. The interest cost represents the increase in the benefit obligation due to the passage of time. The discount rate used is determined at the balance sheet date by reference to market yields on high-quality corporate bonds, where available, or on government bonds. Gains or losses on curtailments or settlements are recognized in profit or loss in the period in which the curtailment or settlement occurs.

Actuarial gains and losses, which represent differences between the expected and actual returns on the plan assets and the effect of changes in the actuarial assumptions, are recognized in other comprehensive income in the period in which they occur.

The defined benefit liability or asset recognized in the balance sheet comprises the net total for each plan of the present value of the benefit obligation, minus any past service costs not yet recognized, minus the fair value of the plan assets at the balance sheet date. Where a plan is in surplus, the asset recognized is limited to the amount of any unrecognized past service costs and the present value of any amounts that the Group expects to recover by way of refunds or a reduction in future contributions. The net total for all plans in surplus is classified as a non-current asset. The net total for all plans in deficit is classified as a non-current liability.

S. Share-based incentives

Share-based incentives are provided to employees under the Group’s share option, bonus and other share award schemes. All ongoing schemes are classified as equity-settled. The Group recognizes a compensation expense in respect of these schemes that is based on the market-based value of the awards, which, where appropriate, is measured using either the Black-Scholes option-pricing formula or a Monte Carlo valuation model. Expected volatility of the price of the shares that are subject to an award is measured using the Merton model based on the volatility of the price of equivalent listed securities. Market-based value is determined at the grant date and reflects market performance conditions and all non-vesting conditions. Market-based value is not subsequently remeasured unless the conditions on which the award was granted are modified. If an award is modified, an additional compensation expense is recognized if and to the extent that the market-based value of the modified award is higher than the fair value of the existing award both measured at the modification date.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

3. Principal accounting policies continued

 

S. Share-based incentives (continued)

 

Generally, the compensation expense is recognized on a straight-line basis over the vesting period. Adjustments are made to reduce the compensation expense to reflect expected and actual forfeitures during the vesting period due to failure to satisfy a service condition or a non-market performance condition.

In the event of a cancellation, whether by the Group or by a participating employee, or settlement of an award by the Group, the compensation expense that would have been recognized over the remainder of the vesting period is recognized immediately in profit or loss. Any payment made to the employee on cancellation or settlement is accounted for as the repurchase of an equity interest, except if the payment exceeds the market-based value of the award measured on the settlement date when the excess is recognized as an additional compensation expense. Where new equity-settled awards are granted that are identified by the Group as replacements for the cancelled awards, the replacement awards are accounted for as a modification of the cancelled awards.

T. Provisions

A provision is a liability of uncertain timing or amount and is generally recognized when the Group has a present obligation as a result of a past event, it is probable that payment will be made to settle the obligation and the payment can be estimated reliably. Additionally, in a business combination, a provision is required in respect of a present obligation of the acquired business at the acquisition date even where it is not probable that payments will be made to settle the obligation but the payment can be estimated reliably.

Provision is made for warranty claims when the relevant products are sold, based on historical experience of the nature, frequency and average cost of warranty claims.

Provision is made for the cost of product recalls if management considers it probable that it will be necessary to recall a specific product and the amount can be reasonably estimated.

Provision is made for restructuring costs when a detailed formal plan for the restructuring has been determined and the plan has been communicated to the parties that may be affected by it. Gains from the expected disposal of assets are not taken into account in measuring restructuring provisions and provision is not made for future operating losses.

Provision is made for claims for compensation for injuries sustained by the Group’s employees while at work. The provision represents management’s best estimate of the liability for claims made but not yet fully settled and for

incidents which have occurred but have not yet been reported to the Group. The Group’s liability for claims made but not yet fully settled is calculated on an actuarial basis by a third party administrator. Historical data trends are used to estimate the liability for unreported incidents.

U. Taxation

Current tax is the amount of tax payable or recoverable in respect of the taxable profit or loss for the period. Taxable profit differs from accounting profit because it excludes items of income or expense that are recognized in the period for accounting purposes but are either not taxable or deductible for tax purposes or are taxable or deductible in other periods. Current tax is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date.

The Group recognizes provisions in respect of uncertain tax positions whereby additional current tax may become payable in future periods following the audit by the tax authorities of previously-filed tax returns. Provisions for uncertain tax positions are based upon management’s assessment of the likely outcome of issues associated with assumed permanent differences, interest that may be applied to temporary differences, and the possible disallowance of tax credits and penalties. Provisions for uncertain tax positions are reviewed regularly and are adjusted to reflect events such as the expiry of limitation periods for assessing tax, administrative guidance given by the tax authorities and court decisions.

Deferred tax is tax expected to be payable or recoverable on differences between the carrying amount of an asset or a liability and its tax base used in the computation of taxable profit. Deferred tax is accounted for using the liability method, whereby deferred tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that taxable profits will be available in the foreseeable future against which the deductible temporary differences may be utilized.

Deferred tax assets and liabilities are not recognized if the temporary difference arises from the initial recognition of goodwill or from the initial recognition of other assets and liabilities in a transaction other than a business combination that affects neither accounting profit nor taxable profit.

Deferred tax is provided on temporary differences arising on investments in foreign subsidiaries and associates, except to the extent that the Group is able to control the timing of the reversal of the temporary difference and it is not probable that the temporary difference will reverse in the foreseeable future.

Deferred tax is calculated using the tax rates that are expected to apply in the period in which the liability is settled or the asset is realized.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

3. Principal accounting policies continued

 

U. Taxation (continued)

 

Current tax assets and current tax liabilities are offset when there is a legally enforceable right to set off the amounts and management intends to settle on a net basis. Deferred tax assets and deferred tax liabilities are offset where there is a legally enforceable right to offset current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on the same taxable entity.

Current and deferred tax is recognized in profit or loss unless it relates to an item that is recognized in the same or a different period outside profit or loss, in which case it too is recognized outside profit or loss, either in other comprehensive income or directly in equity.

V. Assets held for sale and discontinued operations

An asset is classified as held for sale if its carrying amount will be recovered by sale rather than by continuing use in the business, the asset is available for immediate sale in its present condition, management is committed to, and has initiated, a plan to sell the asset which, when initiated, was expected to result in a completed sale within 12 months. An extension of the period required to complete the sale does not preclude the asset from being classified as held for sale, provided the delay was for reasons beyond the Group’s control and management remains committed to its plan to sell the asset. Assets that are classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell.

A discontinued operation is a component of an entity that has either been disposed of, or satisfies the criteria to be classified as held for sale, and represents a separate major line of business or geographic area of operations, is part of a single co-ordinated plan to dispose of a separate major line of business or geographic area of operations, or is a subsidiary acquired exclusively with a view to disposal.

W. Accounting pronouncements not yet adopted

Recently-issued accounting pronouncements that may be relevant to the Group’s operations but have not yet been adopted are outlined below. Management does not expect that the adoption of these pronouncements will have a material impact on the Group’s results or financial position.

IFRS 9 ‘Financial Instruments’

In November 2009, the IASB issued IFRS 9 which represents the first phase of its replacement of IAS 39 and introduces new requirements for the classification and measurement of financial assets and removes the need to separately account for certain embedded derivatives.

IFRS 9 is effective for annual periods commencing on or after January 1, 2013. Early adoption is permitted, but the standard has not yet been endorsed for use in the European Union.

‘Improvements to IFRSs 2010’

In May 2010, the IASB published amendments to seven IFRSs that address a number of issues, including the measurement in a business combination of non-controlling interests and the un-replaced or voluntarily replaced share-based payment awards of an acquired entity, the presentation of the analysis of other comprehensive income by item and clarification of certain disclosures about financial instruments.

While the amendments are effective for annual periods beginning on or after either July 1, 2010 or January 1, 2011, they have not yet been endorsed for use in the European Union.

 

4. Critical accounting estimates

A. Background

When applying the Group’s accounting policies, management must make assumptions and estimates concerning the future that affect the carrying amounts of assets and liabilities at the balance sheet date, the disclosure of contingencies that existed at the balance sheet date and the amounts of revenue and expenses recognized during the accounting period. Such assumptions and estimates are based on factors such as historical experience, the observance of trends in the industries in which the Group operates and information available from the Group’s customers and other outside sources.

Due to the inherent uncertainty involved in making assumptions and estimates, actual outcomes could differ from those assumptions and estimates. An analysis of the key sources of estimation uncertainty at the balance sheet date that have a significant risk of causing a material adjustment to the carrying amounts of the Group’s assets and liabilities within the next financial year is presented below.

B. Post-employment benefits

The Group operates pension plans throughout the world, covering the majority of its employees. Pension benefits are provided by way of both defined contribution plans and defined benefit plans. The Group’s defined benefit pension plans are closed to new entrants. The Group also provides other post-employment benefits, principally health and life insurance cover, to certain of its employees in North America by way of unfunded defined benefit plans.

The Group accounts for post-employment benefits in accordance with IAS 19 ‘Employee Benefits’, whereby the cost of defined benefit plans is determined based on

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

4. Critical accounting estimates continued

 

B. Post-employment benefits (continued)

 

actuarial valuations of the plans that are carried out annually at the Group’s balance sheet date. The actuarial valuations are dependent on assumptions about the future that are made by management on the advice of independent qualified actuaries.

If actual experience differs from these assumptions, there could be a material change in the amounts recognized by the Group in respect of defined benefit plans in the next financial year.

As at December 31, 2010, the present value of the benefit obligation was $1,258.5 million. The benefit obligation is calculated using a number of assumptions including future salary increases, increases to pension benefits, mortality rates and, in the case of post-employment medical benefits, the expected rate of increase in medical costs. The present value of the benefit obligation is calculated by discounting the benefit obligation using market yields on high-quality corporate bonds at the balance sheet date. As at December 31, 2010, the fair value of the plan assets was $1,011.1 million.

The plan assets consist largely of listed securities and their fair values are subject to fluctuation in response to changes in market conditions.

Effects of changes in the actuarial assumptions underlying the benefit obligation, effects of changes in the discount rate applicable to the benefit obligation and effects of differences between the expected and actual return on the plan assets are classified as actuarial gains and losses and are recognized in other comprehensive income. During 2010, the Group recognized a net actuarial gain of $70.1 million. Further actuarial gains and losses will be recognized during the next financial year.

An analysis of the assumptions that will be used by management to determine the cost of defined benefit plans that will be recognized in profit or loss in the next financial year is presented in note 35.

C. Impairment of long-lived assets

Goodwill, other intangible assets and property, plant and equipment are tested for impairment whenever events or circumstances indicate that their carrying amounts might be impaired. Additionally, goodwill and other intangible assets that have indefinite useful lives are subject to an annual impairment test. Due to the nature of the Group’s operations, it is generally not possible to estimate the recoverable amount for individual long-lived assets and impairment tests are usually based on the value in use of the CGU or group of CGUs to which the asset belongs.

Value in use represents the net present value of the cash flows expected to arise from the relevant CGU or group of

CGUs and its calculation requires management to estimate those cash flows and to apply a suitable discount rate to them.

Management bases the estimated cash flows of the CGU or group of CGUs on assumptions such as the future changes in sales volumes, future changes in selling prices, and future changes in material prices, salaries and other costs. Management determines a discount rate for each CGU or group of CGUs using a capital asset pricing model, which is based on variables including the applicable risk-free interest rates and, for determining the cost of equity, the long-term equity risk premium and the assumed share price volatility relative to the market and, for determining the cost of debt, the assumed credit risk spreads.

As at December 31, 2010, the carrying amount of long-lived assets was $5,373.0 million. Impairment losses may be recognized on these assets within the next financial year if there are adverse changes in the variables and assumptions underlying the estimated future cash flows of the CGUs or the discount rates that are applied to those cash flows. The sensitivity of the carrying amount of goodwill to the key assumptions underlying the value in use calculations is discussed in note 20.

D. Inventory

Inventories are stated at the lower of cost and net realizable value, with due allowance for excess, obsolete or slow-moving items. Net realizable value is based on current assessments of future demand, market conditions and new product development initiatives. As at December 31, 2010, the carrying value of inventories was $693.5 million, net of allowances of $7.9 million. Should demand for the Group’s products decline during the next financial year, additional allowances may be necessary in respect of excess or slow-moving items.

E. Financial instruments

Derivative financial instruments are recognized as an asset or a liability measured at their fair value at the balance sheet date. The fair value of derivatives continually changes in response to changes in prevailing market conditions and applicable credit risk spreads.

Where permissible under IAS 39, the Group uses hedge accounting to mitigate the impact of changes in the fair value of derivatives on profit or loss but the Group’s results may be affected by changes in the fair values of derivatives where hedge accounting cannot be applied or due to hedge ineffectiveness.

F. Workers’ compensation

Provision is made for claims for compensation for injuries sustained by the Group’s employees while at work. The Group’s liability for claims made but not fully settled is calculated on an actuarial basis. Historical data trends are

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

4. Critical accounting estimates continued

 

F. Workers’ compensation (continued)

 

used to estimate the liability for unreported incidents. As at December 31, 2010, the workers’ compensation provision amounted to $21.6 million.

Further provision may be necessary within the next financial year if the actual cost of settling claims exceeds management’s estimates.

G. Environmental liabilities

Provision is made for the estimated cost of known environmental remediation obligations in relation to the Group’s current and former manufacturing facilities. Cost estimates include the expenditure expected to be incurred in the initial remediation effort and, where appropriate, in the long-term monitoring of the relevant sites. Management monitors for each remediation project the costs incurred to date against expected total costs to complete and operates procedures to identify possible remediation obligations that are presently unknown.

As at December 31, 2010, the provision for environmental remediation costs amounted to $12.0 million. Further provision may be necessary within the next financial year if actual remediation costs exceed expected costs, new remediation obligations are identified or there are changes in the circumstances affecting the Group’s legal or constructive remediation obligations.

H. Product warranties

Provision is made for the estimated cost of future warranty claims on the Group’s products. Management bases the provision on historical experience of the nature, frequency and average cost of warranty claims and takes into account recent trends that might suggest that the historical claims experience may differ from future claims. As at December 31, 2010, the Group’s provision for warranty claims amounted to $12.1 million. Further provision may be necessary within the next financial year if actual claims experience differs from management’s estimates.

I. Taxation

The Group is subject to income tax in most of the jurisdictions in which it operates. Management is required to exercise significant judgment in determining the Group’s provision for income taxes.

Estimation is required of taxable profit in order to determine the Group’s current tax liability. Management’s judgment is required in relation to uncertain tax positions whereby additional current tax may become payable in the future following the audit by the tax authorities of previously-filed tax returns. It is possible that the final outcome of these uncertain tax positions may differ from management’s estimates.

Estimation is also required of temporary differences between the carrying amount of assets and liabilities and their tax base. Deferred tax liabilities are recognized for all taxable temporary differences but, where there exist deductible temporary differences, management’s judgment is required as to whether a deferred tax asset should be recognized based on the availability of future taxable profits. As at December 31, 2010, the Group recognized net deferred tax liabilities amounting to $779.9 million. Deferred tax assets of $825.1 million were not recognized in respect of tax losses and tax credits carried forward. It is possible that the deferred tax assets actually recoverable may differ from the amounts recognized if actual taxable profits differ from management’s estimates.

As at December 31, 2010, the aggregate amount of temporary differences associated with investments in subsidiaries for which deferred tax liabilities have not been recognized was $1,375.0 million. Deferred tax liabilities have not been recognized on these temporary differences because the Group is able to control the timing of their reversal and it is not probable that they will reverse in the foreseeable future. Income tax may become payable on these temporary differences if circumstances change, for example upon the repatriation of assets from the subsidiaries concerned or on the sale or liquidation of one or more of them.

 

5. Segment information

A. Background

The Group’s operating segments are identified by grouping together businesses that manufacture similar products, as this is the basis on which information is provided to the Board for the purposes of allocating resources within the Group and assessing the performance of the Group’s businesses.

The Group’s internal management reports distinguish between those of the Group’s continuing operations that are ongoing and those that have been exited but do not meet the conditions to be classified as discontinued operations.

The Group’s ongoing operating segments are described in note 2.

The Group’s exited operating segments comprise: the Stant and Standard-Thomson businesses that were sold in Fiscal 2008 (‘Caps & Thermostats’) and the Philips Doors & Windows business that was closed during Fiscal 2009 (‘Doors & Windows’).

B. Measure of segment profit or loss

The Board uses adjusted earnings before interest, tax, depreciation and amortization (‘adjusted EBITDA’) to measure the profitability of each segment. Adjusted EBITDA is, therefore, the measure of segment profit or loss presented in the Group’s segment disclosures.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

5. Segment information continued

 

B. Measure of segment profit or loss (continued)

 

EBITDA represents profit or loss for the period before net finance costs, income taxes, depreciation and amortization. Adjusted EBITDA represents EBITDA before specific items that are considered to hinder comparison of the trading performance of the Group’s businesses either year on year or with other businesses.

During the periods under review, the specific items excluded from EBITDA in arriving at adjusted EBITDA were as follows:

 

•  

the effect on cost of sales of the uplift to the carrying amount of inventory held by Tomkins on its acquisition by the Group;

 

•  

the compensation expense in relation to share-based incentives;

 

•  

transaction costs incurred in business combinations;

 

•  

impairments, comprising impairments of goodwill and intangible assets recognized in business combinations and material impairments of other assets;

 

•  

restructuring costs;

 

•  

the net gain or loss on disposals and on the exit of businesses; and

 

•  

the gain recognized on amendments to certain post-employment benefit plans in North America.

C. Sales and adjusted EBITDA – continuing operations

 

     Sales            Adjusted EBITDA  
     SUCCESSOR                    PREDECESSOR            SUCCESSOR                   PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

            

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Ongoing segments

                                       

Industrial & Automotive:

                                       

– Power Transmission

      580.8                 1,555.9         1,763.4         2,125.2           115.2               318.2       295.8       333.0  

– Fluid Power

      215.4                 569.1         588.7         832.3           27.6               73.2       18.8       79.3  

– Sensors & Valves

      107.9                 294.3         313.6         421.0           17.4               44.5       25.6       56.5  

– Other Industrial & Automotive

      131.3                           417.5         463.4         602.1                 15.9                         55.2       41.6       61.9  
       1,035.4                           2,836.8         3,129.1         3,980.6                 176.1                         491.1       381.8       530.7  

Building Products:

                                       

– Air Distribution

      226.7                 636.2         874.2         1,112.3           22.6               80.5       105.6       132.7  

– Bathware

      27.1                           91.7         140.3         208.2                 (1.2 )                        (1.7 )      (0.1 )      (2.1 ) 
       253.8                           727.9         1,014.5         1,320.5                 21.4                         78.8       105.5       130.6  

Corporate

      –                           –         –         –                 (6.1 )                        (25.8 )      (26.7 )      (27.8 ) 

Total ongoing

      1,289.2                           3,564.7         4,143.6         5,301.1                 191.4                         544.1       460.6       633.5  
   

Exited segments

                                       

Industrial & Automotive:

                                       

– Caps & Thermostats

      –                 –         –         80.2           –                –        –        10.3  

Building Products:

                                       

– Doors & Windows

      –                           –         36.5         134.6                 (0.2 )                        (0.7 )      (12.9 )      (10.4 ) 

Total exited

      –                           –         36.5         214.8                 (0.2 )                        (0.7 )      (12.9 )      (0.1 ) 
                                                                                                                  
       1,289.2                           3,564.7         4,180.1         5,515.9                 191.2                         543.4       447.7       633.4  

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

5. Segment information continued

 

C. Sales and adjusted EBITDA – continuing operations (continued)

 

    

Sales

           

Adjusted EBITDA

  
     SUCCESSOR                    PREDECESSOR            SUCCESSOR                    PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

            

Q4 2010

$ million

                     

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

By origin

                                          

US

      592.9                 1,745.9         2,172.9         2,947.6           71.9                 252.6         199.3         276.4   

Rest of North America

      163.8                 434.8         446.9         557.8           37.5                 89.4         67.7         109.3   

UK

      96.3                 252.9         297.0         399.6           10.6                 32.6         22.5         25.0   

Rest of Europe

      188.2                 492.9         603.5         787.2           20.4                 43.1         56.2         87.5   

Asia

      174.3                 433.9         466.1         576.9           42.8                 97.6         85.0         89.4   

Rest of the world

      73.7                           204.3         193.7         246.8                 8.0                           28.1         17.0         45.8   
       1,289.2                           3,564.7         4,180.1         5,515.9                 191.2                           543.4         447.7         633.4   

By destination

                                        

US

      667.9                 1,948.4         2,358.9        3,178.7                       

Rest of North America

      118.1                 304.0         323.3         421.5                       

UK

      28.9                 71.1         87.3        129.0                       

Rest of Europe

      201.7                 528.1         665.8        864.9                       

Asia

      186.9                 479.8         511.2         630.1                       

Rest of the world

      85.7                           233.3         233.6         291.7                             
       1,289.2                           3,564.7         4,180.1         5,515.9                             

Inter-segment sales were not significant.

During the period, there were no sales made in the Netherlands.

Reconciliation of the profit or loss for the period from continuing operations to adjusted EBITDA:

 

     SUCCESSOR                   PREDECESSOR  
     

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

(Loss)/profit for the period from continuing operations

      (270.2 )              250.8       9.9       (46.5 ) 

Income tax (benefit)/expense

      (32.9 )                        62.8       28.5       38.4  

(Loss)/profit before tax

      (303.1 )              313.6        38.4       (8.1 ) 

Net finance costs

      99.3                          26.3       46.3       75.0  

Operating (loss)/profit

      (203.8 )              339.9       84.7       66.9  

Amortization

      44.2                17.0       25.6       26.0  

Depreciation

      54.0                          120.1       172.2       203.1  

EBITDA

      (105.6 )              477.0       282.5       296.0  

Inventory uplift

      144.2                –        –        –   

Share-based incentives

      72.4                21.2       11.3       12.0  

Transaction costs

      78.2                41.5       –        –   

Impairments (see note 7)

      –                –        73.0       342.4  

Restructuring costs (see note 8)

      2.0                10.0       144.1       26.0  

Net gain on disposals and on the exit of businesses (see note 8)

      –                (6.3 )      (0.2 )      (43.0 ) 

Gain on amendment of post-employment benefits (see note 9)

      –                          –        (63.0 )      –   

Adjusted EBITDA

      191.2                          543.4       447.7       633.4   

 

F-22

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

5. Segment information continued

 

D. Non-current assets

The geographic analysis of long-lived assets (goodwill and other intangible assets, and property, plant and equipment) and investments in associates was as follows:

 

       SUCCESSOR                      PREDECESSOR  
       

As at

December 31,

2010

$ million

                       

As at

January 2,

2010

$ million

  

By location

                  

US

        2,849.3                   862.9   

Rest of North America

        377.9                   228.5   

UK

        346.7                   65.6   

Rest of Europe

        774.2                   175.2   

Asia

        809.4                   224.9   

Rest of the world

        239.1                             100.3   
         5,396.6                             1,657.4   

Capital expenditure, depreciation and amortization in respect of long-lived assets was as follows:

SUCCESSOR

 

       SUCCESSOR  
       Q4 2010  
       

Capital

expenditure
$ million

        Depreciation
$ million		        Amortization
$ million		  

Continuing operations

               

Ongoing segments

               

Industrial & Automotive:

               

– Power Transmission

        38.9           25.9           30.5   

– Fluid Power

        7.5           7.5           3.6   

– Sensors & Valves

        4.9           6.5           2.9   

– Other Industrial & Automotive

        2.7           3.8           2.9   
         54.0           43.7           39.9   

Building Products:

               

– Air Distribution

        5.9           8.2           3.8   

– Bathware

        0.1           2.1           0.5   
         6.0           10.3           4.3   

Corporate

        0.2           –           –   
         60.2           54.0           44.2   

 

F-23

Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

5. Segment information continued

 

D. Non-current assets (continued)

 

PREDECESSOR

 

    PREDECESSOR  
    9M 2010           Fiscal 2009           Fiscal 2008  
    

Capital

expenditure

$ million

     Depreciation
$ million		    

Amortization

$ million

           

Capital

expenditure
$ million

    

Depreciation

$ million

    

Amortization

$ million

           

Capital

expenditure
$ million

    

Depreciation

$ million

    

Amortization

$ million

  

Continuing operations

                      

Ongoing segments

                      

Industrial & Automotive:

                      

– Power Transmission

     48.7        54.4        4.6          50.3        74.3        7.5          91.6        96.1        7.8  

– Fluid Power

     16.9        17.9        5.8          36.4        25.5        8.2          35.8        27.3        8.8  

– Sensors & Valves

     8.1        15.2        0.8          5.7        23.8        1.2          19.5        26.1        1.2  

– Other Industrial & Automotive

     4.2        9.9        0.9                13.3        15.2        1.2                12.2        15.8        1.1  
      77.9        97.4        12.1                105.7        138.8        18.1                159.1        165.3        18.9  

Building Products:

                      

– Air Distribution

     11.0        17.2        4.7          13.6        24.7        7.2          28.4        26.3        6.6  

– Bathware

     2.9        5.3        –                3.5        8.3        0.1                2.2        9.6        0.2  
      13.9        22.5        4.7                17.1        33.0        7.3                30.6        35.9        6.8  

Corporate

     3.9        0.2        0.2                0.1        0.2        0.2                0.2        0.1        0.3  

Total ongoing

     95.7        120.1        17.0                122.9        172.0        25.6                189.9        201.3        26.0  

Exited segments

                      

Industrial & Automotive:

                      

– Caps & Thermostats

     –        –        –          –        –        –          2.8        –        –   

Building Products:

                      

– Doors & Windows

     –        –        –                0.1        0.2        –                1.1        1.8        –   

Total exited

     –        –        –                0.1        0.2        –                3.9        1.8        –   
                                                                                         
      95.7        120.1        17.0                123.0        172.2        25.6                193.8        203.1        26.0  

 

6. Transaction costs

Transaction costs may be analyzed as follows:

 

       SUCCESSOR                      PREDECESSOR  
       

Q4 2010

$ million

                       

9M 2010

$ million

       

Fiscal 2009

$ million

       

Fiscal 2008

$ million

  

Acquisition of Tomkins:

                            

– Acquisition-related costs

        78.2                   –           –           –   

– Costs incurred by Tomkins

        –                             40.9           –           –   
       78.2                   40.9           –           –   

Other acquisitions

        –                             0.6           –           –   
         78.2                             41.5           –           –   

Acquisition-related costs incurred in relation to businesses acquired before January 3, 2010 were included in the cost of acquisition.

 

F-24

Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

7. Impairments

In Fiscal 2009, the Group recognized impairments amounting to $73.0 million, comprising $18.9 million on goodwill and intangible assets arising on acquisitions, $38.6 million on assets that became impaired as a consequence of the Group’s restructuring initiatives and $15.5 million on receivables held in relation to the disposal of businesses in previous years.

In Fiscal 2008, impairments amounted to $342.4 million, of which $228.6 million related to goodwill and $113.8 million to property, plant and equipment, which largely resulted from the significant deterioration during 2008 of the North American automotive original equipment and US residential construction markets.

 

     SUCCESSOR                   PREDECESSOR  
     Q4 2010                   9M 2010           Fiscal 2009           Fiscal 2008  
      Total
$ million		                     Total
$ million		           

Goodwill

$ million

    

Other

intangible

assets
$ million

     Property,
plant and
equipment
$ million		    

Long-term
receivables

$ million

    

Total

$ million

            Goodwill
$ million		     Property,
plant and
equipment
$ million		    

Total

$ million

  

Ongoing segments

                                 

Industrial & Automotive:

                                 

– Power Transmission

      –                –          –        9.3        13.9        –        23.2          194.6        90.0        284.6   

– Fluid Power

      –                –          –        3.0        9.5        –        12.5          –        11.7        11.7   

– Sensors & Valves

      –                –          –        –        –        –        –          –        1.1        1.1   

– Other Industrial & Automotive

      –                          –                –        –        0.7        –        0.7                –        –        –   
       –                          –                –        12.3        24.1        –        36.4                194.6        102.8        297.4   

Building Products:

                                 

– Air Distribution

      –                –          8.7        9.7        0.2        –        18.6          34.0        –        34.0   

– Bathware

      –                          –                –        –        2.5        –        2.5                –        –        –   
       –                          –                8.7        9.7        2.7        –        21.1                34.0        –        34.0   

Corporate

      –                          –                –        –        –        15.5        15.5                –        –        –   

Total ongoing

      –                          –                8.7        22.0        26.8        15.5        73.0                228.6        102.8        331.4   
 

Exited segment

                                 

Building Products:

                                 

– Doors & Windows

      –                          –                –        –        –        –        –                –        11.0        11.0   
       –                          –                8.7        22.0        26.8        15.5        73.0                228.6        113.8        342.4   

 

8. Restructuring initiatives

A. Restructuring costs

Restructuring costs recognized during both Q4 2010 and 9M 2010 principally related to the cessation of certain of Power Transmission’s manufacturing facilities in North America and were partially offset by gains on various asset disposals.

Restructuring costs recognized during Fiscal 2009 principally arose in relation to the restructuring of the Group’s manufacturing operations under projects Eagle and Cheetah. In particular:

 

•  

in Industrial & Automotive, the cessation of Power Transmission’s manufacturing operations in Aachen, Germany, the rationalization of its powder metal facility at Mississauga, Ontario, and the closures of its pulley and tensioner facility at London, Ontario, and FormFlo in the UK; the cessation of Fluid Power’s hose manufacturing activities in Erembodegem, Belgium and the substantial closure of its assembly facility at St. Neots, UK; and, in Other Industrial & Automotive, the closure of Ideal’s manufacturing facility at St. Augustine, Florida and the rationalization of Dexter’s manufacturing facilities; and

 

•  

in Building Products, the closure of the Philips Doors and Windows business.

In Fiscal 2008, restructuring costs principally related to the closure of Power Transmission’s facility at Moncks Corner, South Carolina, further rationalization of the Lasco Bathware business in the US and the closure of Hart & Cooley’s production facility at Tucson, Arizona, and further costs associated with outsourcing of information technology services that began in 2007.

 

F-25

Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

8. Restructuring initiatives continued

 

B. Disposals and exit of businesses

During 9M 2010, the Group recognized a net gain of $9.6 million on the disposal of property, plant and equipment, principally as a consequence of the restructuring of Bathware and the closure of Doors & Windows. However, a loss of $3.3 million was recognized in relation to the disposal of a subsidiary that took place in 2008 and on the disposal of Hydrolink’s operations in Kazakhstan.

In Fiscal 2009, the Group recognized a net gain of $0.2 million in relation to the disposal of businesses in prior years.

In Fiscal 2008, the Group recognized a gain of $43.2 million on the disposal of Stant and Standard-Thomson.

SUCCESSOR

 

                           SUCCESSOR  
                           Q4 2010  
       

Restructuring

costs
$ million

       

Disposals

and exit

of businesses
$ million

        Total
$ million		  

Continuing operations

               

Ongoing segments

               

Industrial & Automotive:

               

– Power Transmission

        (2.2 )         –           (2.2 ) 

– Fluid Power

        1.0           –           1.0   

– Sensors & Valves

        1.7           –           1.7   
         0.5           –           0.5   

Corporate

        (2.0 )         –           (2.0 ) 

Total ongoing

        (1.5 )         –           (1.5 ) 

Exited segment

               

Building Products:

               

– Doors & Windows

        (0.5 )         –           (0.5 ) 
         (2.0 )         –           (2.0 ) 

PREDECESSOR

 

                                                                   PREDECESSOR  
    9M 2010           Fiscal 2009           Fiscal 2008  
    

Restructuring

costs
$ million

    

Disposals

and exit

of businesses
$ million

     Total
$ million		           

Restructuring

costs
$ million

    

Disposals

and exit

of businesses
$ million

     Total
$ million		           

Restructuring

costs
$ million

    

Disposals

and exit

of businesses
$ million

     Total
$ million		  

Continuing operations

                      

Ongoing segments

                      

Industrial & Automotive:

                      

– Power Transmission

     (6.8 )      4.0       (2.8 )        (75.6 )      –        (75.6 )        (13.8 )      –        (13.8 ) 

– Fluid Power

     (2.4 )      0.5       (1.9 )        (26.0 )      –        (26.0 )        (1.9 )      –        (1.9 ) 

– Sensors & Valves

     –        –        –          (3.2 )      –        (3.2 )        (0.2 )      –        (0.2 ) 

– Other Industrial & Automotive

     (1.1 )      (0.2 )      (1.3 )              (12.2 )      0.3       (11.9 )              (3.2 )      –        (3.2 ) 
      (10.3 )      4.3       (6.0 )              (117.0 )      0.3       (116.7 )              (19.1 )      –        (19.1 ) 

Building Products:

                      

– Air Distribution

     (1.7 )      (0.8 )      (2.5 )        (5.1 )      –        (5.1 )        (3.6 )      –        (3.6 ) 

– Bathware

     (0.1 )      3.2       3.1               (1.6 )      –        (1.6 )              (2.2 )      (0.2 )      (2.4 ) 
      (1.8 )      2.4       0.6               (6.7 )      –        (6.7 )              (5.8 )      (0.2 )      (6.0 ) 

Corporate

     –        (2.3 )      (2.3 )              (0.5 )      (0.1 )      (0.6 )              (0.3 )      –        (0.3 ) 

Total ongoing

     (12.1 )      4.4       (7.7 )              (124.2 )      0.2       (124.0 )              (25.2 )      (0.2 )      (25.4 ) 

Exited segments

                      

Industrial & Automotive:

                      

– Caps & Thermostats

     –        –        –          –        –        –          –        43.2       43.2  

Building Products:

                      

– Doors & Windows

     2.1       1.9       4.0               (19.9 )      –        (19.9 )              (0.8 )      –        (0.8 ) 

Total exited

     2.1       1.9       4.0               (19.9 )      –        (19.9 )              (0.8 )      43.2       42.4  
                                                                                         
      (10.0 )      6.3       (3.7 )              (144.1 )      0.2       (143.9 )              (26.0 )      43.0       17.0  

 

F-26

Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

9. Gain on amendment of post-employment benefits

With effect from September 30, 2009, the Group closed its principal defined benefit pension plans in the US and Canada to future service accrual and the deferred pension benefits accrued under those plans were frozen, based on the pensionable salaries of participating employees at that date. In addition, the Group closed the Gates post-retirement healthcare plan in the US to employees who had not retired by December 31, 2009 and reduced the benefits payable to existing beneficiaries.

As a result of these amendments, the Group recognized a gain of $63.0 million in Fiscal 2009, of which $35.3 million related to pensions and $27.7 million to healthcare benefits.

 

       SUCCESSOR                                          PREDECESSOR  
       

Q4 2010

$ million

                       

9M 2010

$ million

       

Fiscal 2009

$ million

       

Fiscal 2008

$ million

  

Ongoing segments

                            

Industrial & Automotive:

                            

– Power Transmission

        –                   –           29.7           –   

– Fluid Power

        –                   –           31.4           –   

– Other Industrial & Automotive

        –                             –           1.7           –   
         –                             –           62.8           –   

Corporate

        –                             –           0.2           –   
         –                             –           63.0           –   

 

10. Employees

The average number of persons employed by the Group was as follows:

 

       SUCCESSOR                                          PREDECESSOR  
       

Q4 2010

Number

                       

9M 2010

Number

       

Fiscal 2009

Number

       

Fiscal 2008

Number

  

Continuing operations

                            

Ongoing segments

                            

Industrial & Automotive:

                            

– Power Transmission

        10,399                   9,617           8,998           9,736   

– Fluid Power

        5,122                   4,804           4,428           5,252   

– Sensors & Valves

        2,140                   2,078           2,015           2,349   

– Other Industrial & Automotive

        2,913                             2,859           2,619           3,217   
         20,574                             19,358           18,060           20,554   

Building Products:

                            

– Air Distribution

        6,736                   6,682           7,074           8,624   

– Bathware

        739                             895           1,038           1,481   
         7,475                             7,577           8,112           10,105   

Corporate

        133                             146           145           158   

Total ongoing

        28,182                             27,081           26,317           30,817   
 

Exited segments

                            

Industrial & Automotive:

                            

– Caps & Thermostats

        –                   –           –           440   

Building Products:

                            

– Doors & Windows

        –                             –           480           1,167   

Total exited

        –                             –           480           1,607   
         28,182                             27,081           26,797           32,424   

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

10. Employees continued

 

       SUCCESSOR                                          PREDECESSOR  
       

Q4 2010

Number

                       

9M 2010

Number

       

Fiscal 2009

Number

       

Fiscal 2008

Number

  

By location

                            

US

        12,284                   11,770           12,307           16,581   

Rest of North America

        5,170                   5,275           5,070           5,814   

UK

        1,799                   1,721           1,740           1,933   

Rest of Europe

        2,806                   2,573           2,614           3,035   

Asia

        4,353                   4,091           3,763           3,701   

Rest of the world

        1,770                             1,651           1,303           1,360   
         28,182                             27,081           26,797           32,424   

Staff costs recognized in profit or loss during the period were as follows:

 

       SUCCESSOR                                        PREDECESSOR  
       

Q4 2010

$ million

                         

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Wages and salaries

        281.2                     714.4        921.3        1,164.3  

Social security costs

        25.9                     88.6        116.5        144.4  

Pensions (see note 35)

        10.4                     26.8        41.4 †       44.2  

Other post-employment benefits (see note 35)

        –                     (1.7 )       0.4 †       1.1  

Share-based incentives (see note 36)

        81.3                     21.2        11.3        12.0  

Termination benefits

        0.9                               10.4        105.3        13.8  
         399.7                               859.7        1,196.2        1,379.8  

 

† Excludes the gain on the amendment of certain plans in North America (see note 9).

 

11. Interest expense

 

     SUCCESSOR                                  PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Borrowings:

                  

– Interest on bank overdrafts

      –                 6.0       4.6       2.3  

– Interest on bank and other loans:

                  

Term loans

      38.4                –        –        –   

Other bank loans

      –                 0.5       6.1       8.3  

Second Lien Notes

      27.9                –        –        –   

2011 Notes

      1.9                13.3       19.9       23.1  

2015 Notes

      3.3                17.2       24.8       29.5  

– Interest on interest rate swaps in designated hedging relationships:

                  

Payable

      –                 11.5       22.1       42.7  

Receivable

      –                 (30.5 )      (44.7 )      (52.6 ) 

– Interest on interest rate swaps classed as held for trading:

                  

Payable

      –                 –        3.0       2.8  

Receivable

      –                           –        (0.6 )      (2.2 ) 
     71.5                18.0       35.2       53.9  

Interest element of finance lease rentals

      –                 0.2       0.4       0.5  

Other interest payable

      4.0                          3.2       7.6       5.0  
     75.5                21.4       43.2       59.4  

Post-employment benefits:

                  

– Interest cost on benefit obligation (see note 35)

      15.4                          50.4       70.0       78.4  
       90.9                          71.8       113.2       137.8  

Details of the bank and other loans are presented in note 30.

Interest expense includes the amortization of issue costs incurred in relation to the borrowings.

From time to time, interest rate swaps are used to manage the interest rate profile of the Group’s borrowings. Net interest payable or receivable on such interest rate swaps is therefore included in interest expense.

 

F-28

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

12. Investment income

 

     SUCCESSOR                                    PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Interest on bank deposits

      1.3                 2.4         2.7        9.6  

Other interest receivable

      1.1                           1.1         1.9        2.7  
     2.4                 3.5         4.6        12.3  

Post-employment benefits:

                    

– Expected return on plan assets (see note 35)

      16.3                           44.7         62.6        75.5  
       18.7                           48.2         67.2        87.8  

 

13. Other finance expense

 

     SUCCESSOR                                 PREDECESSOR  
     

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Derivative financial instruments:

                 

– (Loss)/gain on derivatives in designated hedging relationships

      –                (1.7 )      (1.0 )      0.1  

– Gain/(loss) on derivatives classified as held for trading

      –                –        2.3       (2.1 ) 

– Gain/(loss) on embedded derivatives

      22.9                –        –        (5.1 ) 

Currency translation loss on hedging instruments

      (1.5 )              (1.0 )      (1.6 )      (17.9 ) 

Currency translation loss on the acquisition of Tomkins

      (47.6 )              –        –        –   

Loss on redemption of notes

      (0.9 )                        –        –        –   
       (27.1 )                        (2.7 )      (0.3 )      (25.0 ) 

Other finance expense includes fair value gains and losses arising on financial instruments held by the Group to hedge its translational exposures where either the economic hedging relationship does not qualify for hedge accounting or to the extent that there is deemed to be ineffectiveness in a designated hedging relationship.

Gains and losses on derivative financial instruments are analyzed in note 33.

Additionally, during Q4 2010, the Group incurred a currency translation loss on the acquisition of Tomkins due to the change in the rate of exchange between the pound sterling (in which the purchase consideration was denominated) and the US dollar (the functional currency of the acquiring entity), in the period between the effective date of the acquisition and the payment of the consideration to the former shareholders in Tomkins.

As explained in note 30, during Q4 2010, the Group made repayments against the principal amounts outstanding on the 2011 Notes and the 2015 Notes. In total, £275.8 million of the principal amount of these notes was repaid at a cost of £278.7 million. The carrying amount of these notes that were repaid was £278.1 million. Accordingly, the Group recognized a loss of £0.6 million on the repayments.

 

F-29

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

14. Income tax expense

SUCCESSOR

A. Income tax recognized in profit or loss

 

       SUCCESSOR  
       

Q4 2010

$ million

  

Current tax

     

Dutch corporation tax on profits for the period

        –   

Total Dutch tax

        –   

Overseas tax on profits for the period

        23.2  

Decrease in provision for uncertain tax positions

        (6.2 ) 

Adjustments in respect of prior periods

        0.1  

Total overseas tax

        17.1  

Total current tax

        17.1  

Deferred tax

     

Origination or reversal of temporary differences

        (136.5 ) 

Utilization of previously unrecognized tax losses

        (117.2 ) 

Tax losses in the period not recognized

        198.8  

Adjustments in respect of prior periods

        (0.7 ) 

Other changes in unrecognized deferred tax assets

        5.6  

Total deferred tax

        (50.0 ) 

Income tax benefit for the period

        (32.9 ) 

The income tax expense for the period recognized in profit or loss differs from the product of the loss before tax for the period and the rate of Dutch corporation tax as follows:

 

       SUCCESSOR  
       

Q4 2010

$ million

  

Loss before tax

        (303.1 ) 

Dutch corporation tax at 25.5% on loss before tax

        (77.3 ) 

Permanent differences

        (22.2 ) 

Adjustment in respect of prior periods

        (0.6 ) 

Decrease in provisions for uncertain tax positions

        (6.2 ) 

Effect of different tax rates on overseas profits

        (19.3 ) 

Foreign tax credits

        (1.1 ) 

Temporary differences on investment in subsidiaries

        6.6  

Tax losses in the period not recognized

        198.8  

Utilization of previously unrecognized tax losses

        (117.2 ) 

Other changes in unrecognized deferred tax assets

        5.6  

Income tax benefit for the period

        (32.9 ) 

Deferred tax assets amounting to $198.8 million were not recognized on tax losses arising during the period because it was not considered probable that the taxable entities concerned would generate sufficient taxable profits in the foreseeable future against which the losses may be utilized. However, as a consequence of the acquisition of Tomkins, it was possible to utilize in other taxable entities previously unrecognized tax losses amounting to $117.2 million.

B. Income tax expense recognized outside profit and loss

 

       SUCCESSOR  
       

Q4 2010

$ million

  

Income tax on items recognized in other comprehensive income

     

Net actuarial gain

        15.8  

Available-for-sale investments:

     

– Unrealized gain recognized in the period

        0.1  

Income tax expense recognized outside profit or loss

        15.9  

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

14. Income tax expense continued

 

PREDECESSOR

A. Income tax recognized in profit or loss

 

                    PREDECESSOR  
     

9M 2010

$ million

     

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Current tax

        

UK corporation tax on profits for the period

      0.3        0.3       (13.7 ) 

Adjustments in respect of prior periods

      (0.3 )       0.4       0.3  

Total UK tax

      –         0.7       (13.4 ) 

Overseas tax on profits for the period

      72.6        17.2       51.2  

(Decrease)/increase in provision for uncertain tax positions

      (15.5 )       15.8       (3.2 ) 

Adjustments in respect of prior periods

      (1.4 )       8.0       2.6  

Total overseas tax

      55.7        41.0       50.6  

Total current tax

      55.7        41.7       37.2  

Deferred tax

        

Origination or reversal of temporary differences

      22.6        (24.8 )      (108.2 ) 

Utilization of previously unrecognized tax losses

      (35.3 )       (36.9 )      (4.7 ) 

Tax losses in the period not recognized

      21.3        49.6       111.4  

Other changes in unrecognized deferred tax assets

      (1.8 )       (1.2 )      3.2  

Adjustments in respect of prior periods

      (0.5 )       (0.4 )      (0.5 ) 

Total deferred tax

      6.3        (13.7 )      1.2  

Income tax expense for the period

      62.0        28.0       38.4  

Continuing operations

      62.8        28.5       38.4  

Discontinued operations (see note 15)

      (0.8 )       (0.5 )      –   
       62.0        28.0       38.4  

The income tax expense for the period recognized in profit or loss differs from the product of the profit/(loss) before tax for the period and the rate of UK corporation tax as follows:

 

     PREDECESSOR  
     

9M 2010

$ million

     

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Profit/(loss) before tax:

        

– Continuing operations

      313.6        38.4       (8.1 ) 

– Discontinued operations

      (8.0 )       (4.4 )      –   
       305.6        34.0       (8.1 ) 

UK corporation tax at 28% (Fiscal 2009: 28%; Fiscal 2008: 28.5%) on profit/(loss)

      85.6        9.5       (2.3 ) 

Permanent differences

      0.9        (3.3 )      (48.7 ) 

Adjustment in respect of prior periods

      (2.2 )       8.0       2.4  

(Decrease)/increase in provisions for uncertain tax positions

      (15.5 )       15.8       (3.2 ) 

Effect of different tax rates on overseas profits

      13.3        (11.5 )      (7.1 ) 

Foreign tax credits

      (1.9 )       (4.1 )      (13.3 ) 

Temporary differences on investment in subsidiaries

      (2.3 )       2.1       0.5  

Tax losses in the period not recognized

      21.3        49.6       111.4  

Utilization of previously unrecognized tax losses

      (35.4 )       (36.9 )      (4.7 ) 

Other changes in unrecognized deferred tax assets

      (1.8 )       (1.2 )      3.4  

Income tax expense for the period

      62.0        28.0       38.4  

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

14. Income tax expense continued

 

A. Income tax recognized in profit or loss (continued)

 

During 9M 2010, deferred tax assets amounting to $21.3 million (Fiscal 2009: $49.6 million; Fiscal 2008: $111.4 million) were not recognized on tax losses arising during the period because it was not considered probable that the taxable entities concerned would generate sufficient taxable profits in the foreseeable future against which the losses may be utilized.

Permanent differences arising in Fiscal 2008 principally comprised a tax benefit of $115.8 million on currency translation losses that were not recognized in the accounts but were deductible for tax purposes, less the tax effect of $69.4 million on expenses that were recognized in the accounts but were not deductible for tax purposes (in particular, the tax effect of $45.4 million attributable to the impairment of goodwill).

B. Income tax benefit recognized outside profit and loss

 

       PREDECESSOR  
       

9M 2010

$ million

       

Fiscal 2009

$ million

       

Fiscal 2008

$ million

  

Income tax on items recognized in other comprehensive income

               

Loss on net investment hedges

        –           0.6          16.8  

Net actuarial loss

        (0.9 )         (27.0 )         (30.2 ) 

Available-for-sale investments:

               

– Unrealized gain/(loss) recognized in the period

        –           0.1          (0.4 ) 

– Reclassification to profit or loss of gain on investments sold

        –           –           (0.5 ) 
         (0.9 )         (26.3 )         (14.3 ) 

Income tax on items recognized directly in equity

               

Share-based incentives

        (5.2 )         (0.9 )         –   

Income tax benefit recognized outside profit or loss

        (6.1 )         (27.2 )         (14.3 ) 

 

15. Discontinued operations

During 9M 2010 and Fiscal 2009, the Group recognized additional losses in relation to businesses sold in previous years that were classified as discontinued operations.

The loss for the period from discontinued operations may be analyzed as follows:

 

       SUCCESSOR                      PREDECESSOR  
       

Q4 2010

$ million

                       

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Loss on disposal of discontinued operations

                        

Loss before tax

        –                   (8.0 )       (4.4 )       –   

Income tax benefit

        –                             0.8        0.5        –   

Loss for the period from discontinued operations

        –                             (7.2 )       (3.9 )       –   

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

16. Operating (loss)/profit for the period

Operating profit for the period is stated after charging/(crediting):

 

     SUCCESSOR                   PREDECESSOR  
     

Q4 2010

$ million

                    

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Inventories:

                   

– Cost of inventories

      603.5                1,169.1        3,509.1        3,659.1  

– Write-down of inventories

      2.2                18.7        26.2        6.2  

Staff costs (see note 10)

      399.7                859.7        1,196.2        1,379.8  

Impairments:

                   

– Trade receivables

      –                –         5.8        5.8  

– Other assets (see note 7)

      –                –         73.0        342.4  

Amortization of other intangible assets (see note 21)

      44.2                17.0        25.6        26.0  

Depreciation of property, plant and equipment (see note 22)

      54.0                120.1        172.2        203.1  

Research and development costs

      20.8                62.3        78.0        92.1  

Government grants:

                   

– Revenue

      (1.3 )              (1.2 )       (1.8 )       (3.0 ) 

– Capital

      –                (0.1 )       (0.3 )       (0.4 ) 

Net foreign exchange gains

      (2.3 )                        (5.6 )       (9.0 )       9.8  

 

17. Dividends on ordinary shares

 

     SUCCESSOR                    PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Paid or proposed in respect of the period

                    

Interim dividend

      –                 –         3.50c        11.02c  

Final dividend

      –                           –         6.50c        2.00c  
       –                           –         10.00c        13.02c  
 

Recognized in the period

                    

Interim dividend for the period of nil (Fiscal 2009: 3.50c; Fiscal 2008: 11.02c) per share

      –                 –         30.9         97.1   

Final dividend for the prior period of 6.50c (Fiscal 2009: 2.00c; Fiscal 2008: 16.66c) per share

      –                           56.9        17.4         149.1   
       –                           56.9        48.3         246.2   

Dividends were paid by the predecessor on ordinary shares in Tomkins plc.

 

18. Auditors’ remuneration

Fees payable to the Company’s auditors, Deloitte LLP, and its associates were as follows:

 

     SUCCESSOR                    PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Audit fees:

                    

– Audit of the company’s accounts

      1.1                 –         0.7        0.8  

– Audit of the accounts of the company’s subsidiaries

      4.6                 1.5         4.3        4.9  

– Other statutory services

      0.1                           0.1         0.1        0.2  
     5.8                 1.6         5.1        5.9  

Tax fees:

                    

– Compliance services

      0.1                 –         0.6        0.7  

– Advisory services

      0.1                           0.4         1.0        2.1  
     0.2                 0.4         1.6        2.8  

All other fees

      –                           0.5         0.2        0.2  

Total fees

      6.0                           2.5         6.9        8.9  

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

18. Auditors’ remuneration continued

 

Fees for the audit of the company’s accounts represent fees payable to in respect of the audit of the company’s individual financial statements and the Group’s consolidated financial statements prepared in accordance with IFRSs. Other statutory services include the review of the Group’s interim financial statements. Other fees are paid for services including advice on accounting matters and non-statutory reporting.

The Audit Committee or, between meetings, the Chairman of the Audit Committee, approves the engagement terms and fees of Deloitte LLP, and other member firms of Deloitte & Touche Tohmatsu Limited for all services before the related work is undertaken.

 

19. Cash flow

Reconciliation of (loss)/profit for the period to cash generated from operations:

 

     SUCCESSOR                   PREDECESSOR  
     

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

(Loss)/profit for the period

      (270.2 )              243.6       6.0       (46.5 ) 

Interest expense

      90.9                71.8       113.2       137.8  

Investment income

      (18.7 )              (48.2 )      (67.2 )      (87.8 ) 

Other finance expense

      27.1                2.7       0.3       25.0  

Income tax (benefit)/expense

      (32.9 )                        62.0       28.0       38.4  

Operating (loss)/profit from continuing and discontinued operations

      (203.8 )              331.9       80.3       66.9  

Share of (profit)/loss of associates

      (0.7 )              1.3       0.4       2.1  

Amortization of intangible assets

      44.2                17.0       25.6       26.0  

Depreciation of property, plant and equipment

      54.0                120.1       172.2       203.1  

Impairments:

                 

– Goodwill

      –                –        8.7       228.6  

– Other intangible assets

      –                –        22.0       –   

– Property, plant and equipment

      –                –        26.8       113.8  

– Other receivables

      –                –        15.5       –   

(Gain)/loss on disposal of businesses:

                 

– Continuing operations

      –                (6.3 )      (0.2 )      (43.0 ) 

– Discontinued operations

      –                8.0       4.4       –   

(Gain)/loss on sale of property, plant and equipment

      (1.3 )              (0.8 )      (1.6 )      3.8  

Gain on available-for-sale-investments

      –                –        –        (1.2 ) 

Share-based incentives

      72.4                21.2       11.3       12.0  

Decrease in post-employment benefit obligations

      (13.4 )              (41.1 )      (122.4 )      (49.5 ) 

(Decrease)/increase in provisions

      (13.7 )                        (30.0 )      45.1       (3.7 ) 
     (62.3 )              421.3       288.1       558.9  

Movements in working capital:

                 

– Decrease/(increase) in inventories

      148.6                (112.4 )      214.6       (12.8 ) 

– Decrease/(increase) in receivables

      85.9                (204.9 )      52.3       143.8  

– (Decrease)/increase in payables

      (105.9 )                        111.2       (22.9 )      (61.2 ) 

Cash generated from operations

      66.3                          215.2       532.1       628.7  

 

20. Goodwill

A. Analysis of movements

SUCCESSOR

 

     $ million  

Cost and carrying amount

  

As at September 25, 2010

     –   

Acquisition of subsidiaries

     1,742.1  

Foreign currency translation

     3.3  

As at December 31, 2010

     1,745.4  

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

20. Goodwill continued

 

A. Analysis of movements (continued)

 

PREDECESSOR

 

      $ million  

Cost

   

As at January 3, 2009

      629.2  

Acquisition of subsidiaries

      26.8  

Foreign currency translation

      25.1  

As at January 2, 2010

      681.1  

Acquisition of subsidiaries

      23.1  

Disposals

      (0.6 ) 

Foreign currency translation

      2.5  

As at September 24, 2010

      706.1  

Accumulated impairment

   

As at January 3, 2009

      213.3  

Impairments

      8.7  

Foreign currency translation

      23.1  

As at January 2, 2010

      245.1  

Foreign currency translation

      3.3  

As at September 24, 2010

      248.4  

Carrying amount

   

As at January 2, 2010

      436.0  

As at September 24, 2010

      457.7  

B. Allocation of goodwill

Goodwill is allocated to the following CGUs or groups of CGUs:

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Industrial & Automotive

              

Power Transmission

      1,109.6                 2.2   

Fluid Power

      210.6                 61.6   

Sensors & Valves:

              

– Schrader Electronics

      77.2                1.9   

– Schrader International

      7.9                          –   
     85.1                 1.9   
 

Other Industrial & Automotive:

              

– Ideal

      31.6                 20.9   

– Dexter Group

      92.1                 50.8   

– Gates Australia

      11.0                           –   
       134.7                           71.7   

Total Industrial & Automotive

      1,540.0                           137.4   
 

Building Products

              

Air Distribution:

              

– Air Systems Components

      74.0                 68.2   

– Hart & Cooley Group

      31.7                 184.3   

– Ruskin

      45.1                 37.0   

– Koch Filter

      23.2                 –   

– Other

      4.7                           –   
     178.7                 289.5   

Bathware

      26.7                           9.1   

Total Building Products

      205.4                           298.6   

Total Group

      1,745.4                           436.0   

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

20. Goodwill continued

 

C. Impairment tests

Goodwill is tested for impairment annually and whenever there are indications that it may have suffered an impairment. Goodwill is considered impaired to the extent that its carrying amount exceeds its recoverable amount, which is the higher of the value in use and the fair value less costs to sell of the CGU or group of CGUs to which it is allocated. Impairment tests were carried out during Fiscal 2009 and, following the acquisition of Tomkins, in Q4 2010. In each case, the recoverable amount of all items of goodwill was determined based on value in use calculations.

Management based the value in use calculations on cash flow forecasts derived from the most recent three-year financial plans approved by the Board, in which the principal assumptions were those regarding sales growth rates, selling prices and changes in direct costs.

Cash flows for the years beyond the three-year financial plans for the CGUs to which individually significant amounts of goodwill were allocated were calculated as follows: cash flows in the fourth and fifth years were estimated by management based on relevant industry and economic forecasts; thereafter, the cash flows were projected to grow at either 2% or 2.5% per annum, which rates do not exceed expected long-term growth rates in their respective principal end markets in North America, Europe, India and the Middle East.

Management applied discount rates to the resulting cash flow projections that reflect current market assessments of the time value of money and the risks specific to the CGU or group of CGUs. In each case, the discount rate was determined using a capital asset pricing model. Pre-tax discount rates used in the impairment tests of goodwill during Q4 2010 were in the following ranges: Industrial & Automotive businesses 15.0% to 17.5% (Fiscal 2009: 8.1% to 12.2%); and Building Products businesses 16.1% to 17.0% (Fiscal 2009: 10.4% to 17.2%).

D. Impairments recognized

As there had been no significant change in management’s expectations in relation to the Group’s businesses subsequent to the acquisition of Tomkins, no impairments of goodwill were recognized in Q4 2010.

During Fiscal 2009, the Group recognized an impairment of $8.7 million in relation to Rolastar due to the significant deterioration that had occurred in Rolastar’s end markets since negotiations for its acquisition were concluded in early 2008.

During Fiscal 2008, impairments totaling $228.6 million were recognized in relation to the goodwill allocated to Stackpole, Gates Mectrol and Selkirk.

Stackpole manufactures power transmission components, systems and assemblies, principally for automotive original equipment manufacturers, at its facilities in Canada, Germany and South Korea. Stackpole’s end markets deteriorated significantly during 2008 and this caused the impairment of the entire goodwill allocated to the business, which amounted to $157.2 million. Management used a pre-tax discount rate of 11.7%.

Gates Mectrol manufactures power transmission and motion control belts, principally for industrial and automotive original equipment manufacturers, at its facilities in the US and Germany. Gates Mectrol’s end markets deteriorated during the second half of 2008 and this caused the impairment of the entire goodwill allocated to the business, which amounted to $37.4 million. Management used a pre-tax discount rate of 11.7%.

Selkirk manufactures chimney, venting and air distribution products, principally for the residential construction market in North America. Selkirk’s end markets deteriorated during 2008 and an impairment of $34.0 million was recognized in relation to the goodwill allocated to the business. Management used a pre-tax discount rate of 12.5%.

Impairments are analyzed by operating segment in note 7.

E. Sensitivity to changes in key assumptions

Management does not consider that the recoverable amounts of the CGUs or groups of CGUs to which significant amounts of goodwill are allocated may fall below their carrying amounts not that the aggregate recoverable amount of other CGUs may fall below their aggregate carrying amount due to reasonably possible changes during the next year in one or more of the key assumptions.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

21. Other intangible assets

SUCCESSOR

 

     

Brands and

trade names
$ million

     

Customer
relationships

$ million

     

Technology

and know-how

$ million

     Computer
software
$ million		     Total
$ million		  

Cost

             

As at September 25, 2010

      –         –         –        –        –   

Acquisition of subsidiaries

      325.9        1,622.1        336.3       17.6       2,301.9  

Additions

      –         –         2.3       –        2.3  

Disposals

      –         –         –        (0.3 )      (0.3 ) 

Foreign currency translation

      –         9.2        (0.2 )      0.2       9.2  

As at December 31, 2010

      325.9         1,631.3         338.4        17.5        2,313.1   

Accumulated amortization

             

As at September 25, 2010

      –         –         –        –        –   

Amortization charge for the period

      –         28.4        12.6       3.2       44.2  

Foreign currency translation

      –         0.4        –        –        0.4  

As at December 31, 2010

      –         28.8         12.6        3.2        44.6   

Carrying amount

             

As at September 25, 2010

      –         –         –        –        –   

As at December 31, 2010

      325.9         1,602.5         325.8        14.3        2,268.5   

Brands and trade names have indefinite useful lives and are not amortized but are tested for impairment annually and whenever there are indications that they may have suffered an impairment.

Other intangible assets included above have finite useful lives.

Intangible assets with indefinite useful lives are allocated to the following CGUs or groups of CGUs:

 

     SUCCESSOR  
     

As at

December 31,

2010

$ million

  

Industrial & Automotive

   

Power Transmission

      120.0   

Fluid Power

      72.0   

Other Industrial & Automotive

      27.0   

Total Industrial & Automotive

      219.0   

Building Products

   

Air Distribution:

   

– Air Systems Components

      47.0   

– Hart & Cooley Group

      25.0   

– Ruskin

      22.9   
     94.9   

Bathware

      12.0   

Total Building Products

      106.9   

Total Group

      325.9   

Management has assessed the recoverability of the carrying amount of the brands and trade names using the ‘relief from royalty’ method whereby the value in use of those assets represents the present value of the cost savings to the Group from not having to license them from a third party. The key assumptions used in the relief from royalty method are the hypothetical royalty rate and forecast annual sales.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

21. Other intangible assets continued

 

Management has used a hypothetical royalty rate of 1% per annum. Forecast annual sales were based on the most recent three-year financial plans approved by the Board. Forecast annual sales for the years beyond the three-year financial plans for the CGUs to which the brands and trade names were allocated were calculated as follows: sales in the fourth and fifth years were estimated by management based on relevant industry and economic forecasts; thereafter, sales were generally projected to grow at either 2% or 2.5% per annum, which rates do not exceed expected long-term growth rates in their respective principal end markets in North America, Europe, India and the Middle East.

Management applied discount rates to the resulting royalty savings that reflect current market assessments of the time value of money and the risks specific to the CGU or group of CGUs. In each case, the discount rate was determined using a capital asset pricing model. Pre-tax discount rates used in the annual impairment tests of brands and trade names during 2010 were in the following ranges: Industrial & Automotive businesses 15.0% to 17.5%; and Building Products businesses 16.1% to 17.0%.

PREDECESSOR

 

     

Development
costs

$ million

     Assets
arising on
acquisitions
$ million		     

Computer
software

$ million

    

Total

$ million

  

Cost

          

As at January 3, 2009

      1.8       91.4        130.4       223.6  

Additions

      0.6       –         7.8       8.4  

Acquisition of subsidiaries

      –        5.9        –        5.9  

Disposals

      –        –         (4.6 )      (4.6 ) 

Foreign currency translation

      0.1       3.3        1.3       4.7  

As at January 2, 2010

      2.5       100.6        134.9       238.0  

Additions

      0.5       6.4        5.7       12.6  

Disposals

      –        –         (0.2 )      (0.2 ) 

Foreign currency translation

      (0.1 )      0.2        1.0       1.1  

As at September 24, 2010

      2.9       107.2        141.4       251.5  

Accumulated amortization and impairment

          

As at January 3, 2009

      0.2       22.7        91.9       114.8  

Amortization charge for the period

      0.3       11.2        14.1       25.6  

Disposals

      –        –         (4.5 )      (4.5 ) 

Impairments

      –        10.2        11.8       22.0  

Foreign currency translation

      –        0.9        1.2       2.1  

As at January 2, 2010

      0.5       45.0        114.5       160.0  

Amortization charge for the period

      0.2       7.9        8.9       17.0  

Disposals

      –        –         (0.2 )      (0.2 ) 

Foreign currency translation

      –        0.1        0.5       0.6  

As at September 24, 2010

      0.7       53.0        123.7       177.4  

Carrying amount

          

As at January 2, 2010

      2.0       55.6        20.4       78.0  

As at September 24, 2010

      2.2       54.2        17.7       74.1  

Intangible assets arising on acquisitions principally represented acquired customer relationships.

All intangible assets included above had finite useful lives.

In Fiscal 2009, the Group recognized an impairment of $10.2 million in relation to acquired customer relationships, of which the majority related to Rolastar and arose due to the deterioration in its end markets in the period since its acquisition was negotiated in early 2008. Also in Fiscal 2009, an impairment of $11.8 million was recognized in relation to software licences that had become surplus to requirements as a consequence of the Group’s restructuring initiatives.

Impairments are analyzed by operating segment in note 7.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

22. Property, plant and equipment

SUCCESSOR

 

      Land
and
buildings
$ million		     Plant,
equipment
and vehicles
$ million		     Assets under
construction
$ million		     Total
$ million		  

Cost

         

As at September 25, 2010

      –        –        –        –   

Acquisition of subsidiaries

      428.2       845.9       79.2       1,353.3  

Additions

      2.3       6.8       51.3       60.4  

Transfer from assets under construction

      2.6       27.8       (30.4 )      –   

Transfer to assets held for sale

      (6.9 )      –        –        (6.9 ) 

Disposals

      (1.6 )      (1.8 )      (0.1 )      (3.5 ) 

Foreign currency translation

      2.4       5.1       0.3       7.8  

As at December 31, 2010

      427.0       883.8       100.3       1,411.1  

Accumulated depreciation

         

As at September 25, 2010

      –        –        –        –   

Depreciation charge for the period

      6.2       47.8       –        54.0  

Foreign currency translation

      –        (2.0 )      –        (2.0 ) 

As at December 31, 2010

      6.2       45.8       –        52.0  

Carrying amount

         

As at September 25, 2010

      –        –        –        –   

As at December 31, 2010

      420.8       838.0       100.3       1,359.1  

Land and buildings include freehold land with a carrying value of $96.6 million (January 2, 2010: $63.3 million) that is not depreciated.

Property, plant and equipment includes assets held under finance leases with a carrying amount of $4.2 million (January 2, 2010: $6.3 million). Obligations under finance leases are secured by a lessor’s charge over the leased assets.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

22. Property, plant and equipment continued

PREDECESSOR

 

      Land
and
buildings
$ million		     Plant,
equipment
and
vehicles
$ million		     Assets
under
construction
$ million		     Total
$ million		  

Cost

         

As at January 3, 2009

      691.4       2,413.8       75.4       3,180.6  

Additions

      1.6       16.1       97.5       115.2  

Acquisition of subsidiaries

      2.8       4.6       0.6       8.0  

Transfer from assets under construction

      24.8       80.8       (105.6 )      –   

Transfer from assets held for sale

      (16.6 )      –        –        (16.6 ) 

Disposals

      (16.8 )      (100.5 )      (0.3 )      (117.6 ) 

Foreign currency translation

      22.9       133.2       2.9       159.0  

As at January 2, 2010

      710.1       2,548.0       70.5       3,328.6  

Additions

      14.4       13.7       71.7       99.8  

Acquisitions of subsidiaries

      0.9       3.3       –        4.2  

Transfer from assets under construction

      8.1       46.8       (54.9 )      –   

Transfer to assets held for sale

      (10.5 )      (8.1 )      –        (18.6 ) 

Disposals

      (8.9 )      (129.5 )      (0.6 )      (139.0 ) 

Foreign currency translation

      (0.2 )      (0.2 )      0.7       0.3  

As at September 24, 2010

      713.9       2,474.0       87.4       3,275.3  

Accumulated depreciation and impairment

         

As at January 3, 2009

      275.1       1,738.2       –        2,013.3  

Depreciation charge for the period

      22.0       150.2       –        172.2  

Transfer from assets held for sale

      (4.8 )      –        –        (4.8 ) 

Disposals

      (11.2 )      (95.3 )      –        (106.5 ) 

Impairments

      15.7       8.5       2.6       26.8  

Foreign currency translation

      9.2       95.4       0.2       104.8  

As at January 2, 2010

      306.0       1,897.0       2.8       2,205.8  

Depreciation charge for the period

      17.9       101.9       0.3       120.1  

Transfer to assets held for sale

      (5.7 )      (7.3 )      –        (13.0 ) 

Disposals

      (1.9 )      (126.8 )      –        (128.7 ) 

Foreign currency translation

      (2.3 )      0.3       –        (2.0 ) 

As at September 24, 2010

      314.0       1,865.1       3.1       2,182.2  

Carrying amount

         

As at January 2, 2010

      404.1       651.0       67.7       1,122.8  

As at September 24, 2010

      399.9       608.9       84.3       1,093.1  

Land and buildings include freehold land with a carrying value of $96.6 million (January 2, 2010: $63.3 million) that is not depreciated.

Property, plant and equipment includes assets held under finance leases with a carrying amount of $4.2 million (January 2, 2010: $6.3 million). Obligations under finance leases are secured by a lessor’s charge over the leased assets.

During Fiscal 2009, impairments totaling $26.8 million were recognized in relation to property, plant and equipment that has become impaired as a consequence of the Group’s restructuring initiatives (none of these impairments was individually significant).

During Fiscal 2008, against the background of the weakness of the Group’s end markets, particularly the automotive original equipment markets in North America and Europe and the residential construction market in North America, management reviewed the recoverability of the assets of the Group’s businesses that were exposed to those markets. As a result of that review, impairments totaling $113.8 million were recognized in relation to property, plant and equipment.

Impairments are analyzed by operating segment in note 7.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

23. Investments in associates

 

       SUCCESSOR                      PREDECESSOR  
       

Q4 2010

$ million

                       

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Carrying amount

                        

At the beginning of the period

        –                   20.6        20.3        17.7  

Acquisition of subsidiaries

        22.5                  –         –         –   

Share of profit/(loss) of associates

        0.7                  (1.3 )       (0.4 )       (2.1 ) 

Dividends received from associates

        –                             (0.5 )       (0.3 )       (0.6 ) 
       23.2                  18.8        19.6        15.0  

Additions

        –                   –         –         10.4  

Disposals

        –                   –         –         (1.9 ) 

Foreign currency translation

        0.4                            0.5        1.0        (3.2 ) 

At the end of the period

        23.6                            19.3        20.6        20.3  

As at December 31, 2010, the Group’s principal associates were as follows:

 

Name of company    Country of incorporation    Group’s holding   Nature of business

Ideal Internacional SA

    Mexico    40%   Hose clamps

Pyung Hwa CMB Company Limited

    Korea    21%   Belts

Schrader Duncan Limited

    India    50%   Valves and fittings

Schrader Duncan Limited is listed on the Mumbai Stock Exchange. As at December 31, 2010, the fair value of the Group’s investment based on the quoted market price of that company’s shares was $5.3 million (January 2, 2010: $7.3 million).

Segment analysis of the Group’s investments in associates and of its share of associates’ profit/(loss) for the period:

 

     Investments in associates            Share of profit/(loss) of associates  
     SUCCESSOR                   PREDECESSOR            SUCCESSOR                  

PREDECESSOR

  
     

As at

December 31,

2010

$ million

                    

As at

January 2,

2010

$ million

            

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal
2008

$ million

  

By operating segment

                                

Industrial & Automotive:

                                

– Power Transmission

      16.7                14.0          1.3               1.1       0.3       (2.9 ) 

– Sensors & Valves

      5.0                3.9          (0.4 )              (2.1 )      0.3       0.7  

– Other Industrial & Automotive

      0.6                          0.6          0.1                         0.2       0.2       0.2  
       22.3                          18.5          1.0                         (0.8 )      0.8       (2.0 ) 

Building Products:

                                

– Air Distribution

      1.3                          2.1          (0.3 )                        (0.5 )      (1.2 )      (0.1 ) 
       23.6                          20.6          0.7                         (1.3 )      (0.4 )      (2.1 ) 
 

By location

                              

US

      3.3               3.3                   

Rest of North America

      0.6               0.6                   

Asia

      20.8               17.3                   

Rest of the world

      (1.1 )                    (0.6 )                  
       23.6                         20.6                   

During Q4 2010, the aggregate sales of the Group’s associates were $62.7 million and their aggregate profit for the period was $0.7 million.

As at December 31, 2010, the aggregate total assets of the Group’s associates was $165.7 million (January 2, 2010: $135.9 million) and the aggregate total of their liabilities was $107.8 million (January 2, 2010: $83.8 million).

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

23. Investments in associates continued

 

During 9M 2010, the aggregate sales of the Group’s associates were $188.2 million (Fiscal 2009: $177.5 million; Fiscal 2008: $232.3 million) and their aggregate profit for the period was $2.2 million (Fiscal 2009: loss of $2.3 million; Fiscal 2008: loss of $11.5 million).

 

24. Inventories

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Raw materials and supplies

      225.5                 182.8  

Work in progress

      90.8                 74.8  

Finished goods and goods held for resale

      377.2                           333.2  
       693.5                           590.8  

As at December 31, 2010, inventories were stated net of an allowance for excess, obsolete or slow-moving items of $7.9 million (January 2, 2010: $63.9 million).

Inventories arise wholly in the businesses of Tomkins and were initially recognized by the successor at their fair value at the date of acquisition of Tomkins. Accordingly, in the successor financial statements the allowance for excess, obsolete or slow-moving items reflects only those items of inventory that have been identified as excess, obsolete or slow-moving since the acquisition of Tomkins.

 

25. Trade and other receivables

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Current assets

              

Financial assets:

              

– Trade receivables (see note 26)

      761.1                 662.3  

– Derivative financial instruments (see note 33)

      0.6                 1.2  

– Collateralized cash

      47.0                 2.1  

– Other receivables

      58.4                           41.3  
       867.1                           706.9  

Non-financial assets:

              

– Prepayments

      47.4                           46.1  
       914.5                           753.0  
 

Non-current assets

              

Financial assets:

              

– Derivative financial instruments (see note 33)

      0.9                 56.9  

– Other receivables

      13.0                           16.4  
       13.9                           73.3  

Non-financial assets:

              

– Prepayments

      12.3                           7.8  
       26.2                           81.1  

Collateralized cash comprises cash given as collateral under letters of credit for insurance and regulatory purposes and cash held in escrow for the purpose of repaying the loan notes issued by the Group under the Loan Note Alternative in relation to the acquisition of Tomkins (see note 30).

The Group is the beneficiary of a number of corporate-owned life assurance policies against which it borrows from the relevant life assurance company. As at December 31, 2010, the surrender value of the policies was $644.3 million

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

25. Trade and other receivables continued

 

(January 2, 2010: $577.6 million) and the amount outstanding on the related loans was $642.3 million (January 2, 2010: $575.2 million). For accounting purposes, these amounts are offset and the net receivable of $2.0 million (January 2, 2010: $2.4 million) is included in other receivables.

As at December 31, 2010, trade and other receivables amounting to $4.3 million (January 2, 2010: $1.6 million) were secured on the assets of the debtors.

 

26. Trade receivables

Trade receivables amounted to $761.1 million (January 2, 2010: $662.3 million), net of an allowance of $0.3 million (January 2, 2010: $13.7 million) for doubtful debts.

The Group has a significant concentration of customers in the US, who accounted for 51.8% (9M 2010: 54.7%; Fiscal 2009: 56.4%; Fiscal 2008: 57.6%) of the Group’s sales during Q4 2010, and in the automotive industry, which accounted for 47.1% (9M 2010: 45.9%; Fiscal 2009: 45.1%; Fiscal 2008: 41.9%) of the Group’s sales during Q4 2010. However, no single customer accounted for more than 10% of the Group’s sales and there were no significant amounts due from any one customer.

Before accepting a new customer, the Group assesses the potential customer’s credit quality and establishes a credit limit. Credit quality is assessed by using data maintained by reputable credit rating agencies, by checking of references included in credit applications and, where they are available, by reviewing the customer’s recent financial statements. Credit limits are subject to multiple levels of authorization and are reviewed on a regular basis.

Trade receivables are regularly reviewed for bad and doubtful debts. Bad debts are written off and an allowance is established for specific doubtful debts.

Trade receivables may be analyzed as follows:

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Amounts neither past due nor impaired

      636.7                           561.2  
 

Amounts past due but not impaired:

              

– Less than 30 days old

      3.1                 4.6  

– Between 30 and 60 days old

      53.7                 37.5  

– Between 61 and 90 days old

      24.8                 18.2  

– More than 90 days old

      42.5                           37.0  
     124.1                 97.3  

Amounts impaired:

              

– Total amounts that have been impaired

      0.6                 17.5  

– Allowance for doubtful debts

      (0.3)                           (13.7)   
       0.3                           3.8  
       761.1                           662.3  

Trade receivables arise wholly in the businesses of Tomkins and were initially recognized by the successor at their fair value at the date of acquisition of Tomkins. Accordingly, receivables that were considered impaired by Tomkins are included in the successor financial statements within amounts past due but not impaired and the allowance for doubtful debts relates wholly to receivables that have become impaired since the acquisition of Tomkins.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

26. Trade receivables continued

 

Movements in the allowance for doubtful debts were as follows:

 

     SUCCESSOR                    PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

    

Fiscal 2009

$ million

  

At the beginning of the period

      –                 13.7       11.4  

Charge for the period

      0.3                4.0       6.6  

Acquisition of subsidiaries

      –                 –        1.2  

Transfer to assets held for sale

      –                 (0.1 )      –   

Utilized during the period

      –                 (2.9 )      (4.9 ) 

Released during the period

      –                 (0.2 )      (1.2 ) 

Foreign currency translation

      –                           (0.3 )      0.6  

At the end of the period

      0.3                          14.2       13.7  

Trade receivables are not generally interest-bearing although interest may be charged to customers on overdue accounts.

 

27. Available-for-sale investments

 

     SUCCESSOR                    PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Carrying amount

                    

At the beginning of the period

      –                 1.2        0.8        3.0  

Acquisition of subsidiaries

      1.2                –         –         –   

Additions

      –                 –         –         0.1  

Fair value loss recognized in other comprehensive income

      0.2                (0.1 )       0.4        (1.0 ) 

Disposals

      –                 –         –         (1.6 ) 

Foreign currency translation

      –                           0.1        –         0.3  

At the end of the period

      1.4                          1.2        1.2        0.8  

Available-for-sale investments comprise listed equities.

 

28. Cash and cash equivalents

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Cash on hand and demand deposits

      325.2                 281.2   

Term deposits

      134.1                           163.8   
       459.3                           445.0   

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

28. Cash and cash equivalents continued

 

The currency and interest rate profile of cash and cash equivalents was as follows:

 

    

Floating interest rate

                
      $ million      Weighted
average
interest rate
%		              Non-interest bearing
$ million		     

Total

$ million

  

SUCCESSOR

               

As at December 31, 2010

               

Currency:

               

– US dollar

      34.6        0.0%            21.8        56.4  

– Sterling

      164.1        0.4%            0.4        164.5  

– Euro

      30.9        2.0%            27.0        57.9  

– Canadian dollar

      13.4        2.2%            9.5        22.9  

– Other

      105.8        2.0%            51.8        157.6  
       348.8              110.5        459.3  

PREDECESSOR

               

As at January 2, 2010

               

Currency:

               

– US dollar

      169.5         0.1%            38.4         207.9   

– Sterling

      51.1         0.4%            1.3         52.4   

– Euro

      16.1         0.8%            8.5         24.6   

– Canadian dollar

      25.8         0.4%            –         25.8   

– Other

      116.4         2.0%            17.9         134.3   
       378.9               66.1         445.0   

 

29. Assets held for sale

During 9M 2010, management began actively seeking prospective buyers for Plews Inc, a manufacturer of automotive lubrication products and repair tools, which is included in the Other Industrial & Automotive operating segment. Accordingly, Plews Inc’s assets and liabilities are classified as held for sale as at December 31, 2010. Assets held for sale also include vacant properties no longer required by the Group for its manufacturing operations.

Assets classified as held for sale and directly associated liabilities were as follows:

 

     SUCCESSOR                   PREDECESSOR  
     

As at

December 31,

2010

$ million

                    

As at

January 2,

2010

$ million

  

Assets held for sale

             

Property, plant and equipment

      7.3               11.9   

Inventories

      7.5               –   

Trade and other receivables

      18.0               –   

Deferred tax assets

      3.8                         –   
       36.6                         11.9   

Liabilities directly associated with assets held for sale

             

Trade and other payables

      (7.4 )              –   

Provisions

      (0.7 )                        –   
       (8.1 )                        –   
       28.5                         11.9   

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

30. Borrowings

 

    

SUCCESSOR

                   

PREDECESSOR

  
    

As at December 31, 2010

                   

As at January 2, 2010

  
      Current
liabilities
$ million		     

Non-
current
liabilities

$ million

     

Total

$ million

                      Current
liabilities
$ million		     

Non-current

liabilities

$ million

     

Total

$ million

  

Carrying amount

                          

Bank overdrafts

      7.1        –         7.1                          4.8        –         4.8  

Bank and other loans:

                          

– Secured

                          

Term loans

      18.8        1,793.3        1,812.1                –         –         –   

Second Lien Notes

      19.3        1,079.0        1,098.3                –         –         –   

Other bank loans

      –         –         –                           0.6        0.3        0.9  
       38.1        2,872.3        2,910.4                          0.6        0.3        0.9  

– Unsecured

                          

Bank loans

      –         –         –                 1.2        –         1.2  

2011 Notes

      172.2        –         172.2                1.8        254.7        256.5  

2015 Notes

      0.5        26.6        27.1                7.3        432.3        439.6  

Loan notes

      44.9        –         44.9                          0.3        –         0.3  
       217.6        26.6        244.2                          10.6        687.0        697.6  
       255.7        2,898.9        3,154.6                          11.2        687.3        698.5  
       262.8        2,898.9        3,161.7                          16.0        687.3        703.3  

The Group’s secured borrowings are jointly and severally, irrevocably and fully and unconditionally guaranteed by certain of the Company’s direct and indirect subsidiaries and secured by liens on substantially all of their assets. An analysis of the security given is presented in note 47.

The carrying amount of borrowings may be reconciled to the principal amount outstanding as follows:

 

     SUCCESSOR                   PREDECESSOR  
     

As at

December 31,

2010

$ million

                    

As at

January 2,

2010

$ million

  

Carrying amount

      3,161.7               703.3  

Issue costs

      173.8               2.0  

Interest rate floor

      66.1               –   

Purchase accounting adjustment

      (6.4 )              –   

Accrued interest payable

      (27.7 )              (9.4 ) 

Fair value hedge adjustment (see note 33)

      –                          (45.0 ) 

Principal amount

      3,367.5                         650.9  

As at December 31, 2010, the carrying amount of borrowings includes the following items, each of which are being amortized to profit or loss over the term of the related borrowings using the effective interest method:

 

- costs incurred on the issue of the Senior Secured Credit Facilities and the Second Lien Notes;

 

- the fair value on inception of the interest rate floor (an embedded derivative) that applies to amounts drawn down under the Senior Secured Credit Facilities;

 

- a purchase accounting adjustment to reflect the excess of the fair value of the 2011 Notes and the 2015 Notes over their principal amount on the effective date of the acquisition of Tomkins.

As at January 2, 2010, the carrying amount of borrowings included a fair value hedge adjustment to the carrying amount of the 2011 Notes and the 2015 Notes. On September 16, 2010, the hedging relationship ceased when the hedging

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

30. Borrowings continued

 

instruments were sold and the unamortized balance of the cumulative fair value hedge adjustment was eliminated as a purchase accounting adjustment on the acquisition of Tomkins.

The maturity analysis of the principal amount outstanding is presented in note 34.

Bank loans

Senior Secured Credit Facilities

The Group has Senior Secured Credit Facilities consisting of a Term Loan A credit facility, a Term Loan B credit facility and a senior secured revolving credit facility.

The Group initially borrowed $300.0 million under the Term Loan A credit facility and $1,700.0 million under the Term Loan B credit facility. On December 29, 2010, the Group prepaid $4.0 million against the Term Loan A credit facility and $22.7 million against the Term Loan B credit facility. As at December 31, 2010, the principal amount outstanding under the Term Loan A credit facility was $296.0 million and that under the Term Loan B credit facility was $1,677.3 million.

The revolving credit facility provides for multi-currency revolving loans and letters of credit up to an aggregate principal amount of $300.0 million, with a letter of credit sub-facility of $100.0 million. As at December 31, 2010, there were no drawings for cash under the revolving credit facility but there were letters of credit outstanding amounting to $40.3 million.

Subject to certain conditions, the revolving credit facility may be increased by up to $100.0 million and the Term Loan B credit facility increased by, or new term loan facilities established up to, $400.0 million (less any increase in the revolving credit facility).

Borrowings under the Senior Secured Credit Facilities bear interest at a floating rate, which can be either LIBOR plus an applicable margin or, at the Group’s option, a base rate as defined in the credit agreement plus an applicable margin. The applicable margin for the Term Loan B credit facility is 4.5% per annum for LIBOR and 3.5% per annum for base rate. The applicable margin for the Term Loan A credit facility and the revolving credit facility is between 3.75% and 4.25% per annum for LIBOR and 2.75% and 3.25% per annum for base rate depending on a total leverage to EBITDA ratio. LIBOR is subject to a 1.75% floor and base rate is subject to a 2.75% floor. As at December 31, 2010, borrowings under the Term Loan A credit facility attracted an interest rate of 6.0% per annum and those under the Term Loan B credit facility attracted an interest rate of 6.25% per annum (in both cases, to be next re-set on March 31, 2011). Each letter of credit issued under the revolving credit facility attracts a participation fee equal to the applicable LIBOR margin under the revolving credit facility to the maximum amount available to be drawn and a fronting fee of the greater of 0.25% of the maximum amount available to be drawn and $1,500 per annum. An unused line fee of 0.75% per annum is based on the unused portion of the revolving credit facility (which may decrease to 0.5% per annum based on a total leverage to EBITDA ratio).

The Term Loan A credit facility and the revolving credit facility mature on September 29, 2015 and the Term Loan B credit facility matures on September 29, 2016. The Term Loan A credit facility is subject to quarterly amortization payments of 2.5% and the Term Loan B credit facility is subject to quarterly amortization payments of 0.25%, in each case based on the original principal amount less certain prepayments and commencing on March 31, 2011 with the balance payable on maturity.

The Group may voluntarily prepay loans or reduce commitments under the Senior Secured Credit Facilities, in whole or in part, subject to minimum amounts without premium or penalty, other than in the case of certain re-pricing transactions with respect to the Term Loan B credit facility prior to September 29, 2011, which shall be subject to a 1% premium. If the Group prepays LIBOR rate loans other than at the end of an applicable interest period, it is required to reimburse the lenders for any consequential losses or expenses. The Group must prepay the Term Loan A credit facility and Term Loan B credit facility with net cash proceeds of asset sales, casualty and condemnation events, incurrence of indebtedness (other than indebtedness permitted to be incurred) and a percentage of excess cash flow based on a total leverage to EBITDA ratio, in each case subject to certain exceptions such as reinvestment rights.

On February 11, 2011, the Group agreed with the providers of the Senior Secured Credit Facilities a re-pricing of Term Loan A and Term Loan B and amendments to certain of the covenants attaching to the facilities. It was agreed that for both Term Loan A and Term Loan B the applicable margin for LIBOR will be reduced to 3.0% per annum, with LIBOR being subject to a 1.25% floor, and the applicable margin for base rate will be reduced to 2.0% per annum, with base rate being subject to a 2.25% floor. The re-pricing becomes effective on February 17, 2011 and attracts a one-off premium payment by the Group of $16.8 million.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

30. Borrowings continued

 

Multi-Currency Revolving Credit Facility

As at January 2, 2010, Tomkins had in place a £400 million multi-currency revolving credit facility and had in place a $450 million forward-start facility that commenced on the expiry of the existing facility in August 2010 and was itself due to expire in May 2012. Borrowings under the facility attracted interest at floating rates determined by reference to LIBOR. As at January 2, 2010 and during 9M 2010, there were no drawings against the facility, which was replaced by the Senior Secured Credit Facilities on the acquisition of Tomkins.

Other borrowings

Senior Secured Second Lien Notes

On September 29, 2010, the Group issued $1,150.0 million 9% Senior Secured Second Lien Notes (‘the Second Lien Notes’).

The Second Lien Notes mature on October 1, 2018.

On and after October 1, 2014, the Group may redeem the Second Lien Notes, at its option, in whole at any time or in part from time to time, at the following redemption prices (expressed as percentage of the principal amount), plus accrued and unpaid interest to the redemption date:

 

      Redemption price  

During the year commencing:

   

– October 1, 2014

      104.50%   

– October 1, 2015

      102.25%   

– October 1, 2016 and thereafter

      100.00%   

At any time prior to October 1, 2014, the Group may redeem the Second Lien Notes at its option, in whole at any time or in part from time to time, at 100% of the principal amount thereof plus the greater of (i) 1% of the principal amount and (ii) the excess of the present value at the redemption date of the redemption price as at October 1, 2014 and the required interest payments due from the redemption date to October 1, 2014 (discounted using an appropriate US Treasury Rate plus 50 basis points) over the principal amount, plus accrued and unpaid interest to the redemption date.

At any time, or from time to time, prior to October 1, 2013, but not more than once in any twelve-month period, the Group may redeem up to 10% of the original aggregate principal amount of the Second Lien Notes at a redemption price of 103% of the principal amount thereof plus accrued and unpaid interest thereon up to but not including the redemption date.

Notwithstanding the foregoing, at any time and from time to time prior to October 1, 2013, the Group may redeem in the aggregate up to 35% of the original aggregate principal amount of the Second Lien Notes (calculated after giving effect to any issuance of additional Second Lien Notes) with the net cash proceeds of equity offerings by the Co-operative or certain of its subsidiaries at a redemption price of 109% of the principal amount thereof plus accrued and unpaid interest thereon up to but not including the redemption date, provided that at least 65% of the original aggregate principal amount of the Second Lien Notes remain outstanding after each such redemption (calculated after giving effect to any issuance of additional Second Lien Notes) and the Group satisfies certain other conditions.

In the event of a change of control over the Company, each holder will have the right to require the Group to repurchase all or any part of such holder’s Second Lien Notes at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest to the date of repurchase, except to the extent that the Group has previously elected to redeem the Second Lien Notes.

The issuers of the Second Lien Notes, Tomkins, LLC and Tomkins, Inc., which are both subsidiaries of the Company, have entered into a registration rights agreement pursuant to which they will file a registration statement with the Securities & Exchange Commission in the US and offer to exchange the Second Lien Notes for substantially similar registered notes. Management expects that the registration will become effective during 2011.

2011 Notes and 2015 Notes

When it was acquired by the Group, Tomkins had the following notes outstanding under a Euro Medium Term Note Programme: £150 million 8% notes repayable at par on December 20, 2011 (the ‘2011 Notes’); and £250 million 6.125% notes repayable at par on September 16, 2015 (the ‘2015 Notes’).

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

30. Borrowings continued

 

Each of the 2011 Notes and the 2015 Notes contain a put option giving the holders the option to put their notes to the relevant issuer at par plus accrued interest in the event of a change of control or certain acquisitions and disposals and, in either case, a ratings downgrade occurring as a result of such transaction.

On September 13, 2010, the Group offered to purchase the outstanding 2011 Notes at a price of 105.787 per cent (plus accrued and unpaid interest) and the outstanding 2015 Notes at a price of 100.50 per cent (plus accrued and unpaid interest). Acceptances were received in respect of £40.9 million of the 2011 Notes and £109.3 million of the 2015 Notes. On October 6, 2010, the purchase was completed for total consideration of £153.1 million (plus accrued interest of £3.0 million).

On November 19, 2010, the Group notified holders of the 2011 Notes and the 2015 Notes that the credit rating of the notes had been withdrawn by Moody’s and downgraded by Standard & Poor’s as a consequence of the acquisition of Tomkins and that this constituted a put event entitling the holders to redeem the notes at par (plus accrued and unpaid interest). Put notices were received in respect of £2.1 million of the 2011 Notes and £123.5 million of the 2015 Notes. Settlement took place on December 17, 2010 for total consideration of £125.6 million (plus accrued interest of £2.0 million).

As at December 31, 2010, the principal amount of the outstanding 2011 Notes was £107.0 million and that of the 2015 Notes was £17.2 million.

On December 30, 2010, the Group made a further offer to purchase the outstanding 2011 Notes at a price of 105.00 per cent (plus accrued and unpaid interest). Acceptances were received in respect of £4.9 million of the 2011 Notes. Settlement took place on January 19, 2011 and the principal amount of the outstanding 2011 Notes was thereby reduced to £102.1 million.

Loan Note Alternative

Under the terms of the acquisition of Tomkins, certain shareholders in Tomkins Limited elected to receive loan notes rather than cash in respect of all or part of the consideration payable on the purchase of their shares in Tomkins Limited, subject to a maximum aggregate amount of £50 million (the ‘Loan Note Alternative’). As at December 31, 2010, loan notes with a principal amount of £29.0 million were outstanding under the Loan Note Alternative. The loan notes accrue interest at the higher of 0.8% below LIBOR and 0% (to be next re-set on July 1, 2011).

The loan notes fall due for repayment, at par, on December 31, 2015. From June 30, 2011 until December 31, 2015, each holder has the right to require full or part repayment, at par, half-yearly on June 30 and December 31 and for this reason these loan notes are classified as current liabilities. At any time on or after six months after the date of issue of the loan notes, the Group may purchase any of the loan notes at any price by tender, private treaty or otherwise.

Although the loan notes are unsecured, the Group is required to retain in an escrow account cash equivalent to the nominal amount of the outstanding loan notes.

Guest & Chrimes Notes

When it was acquired by the Group, Tomkins had in issue loan notes by way of consideration for the acquisition of a former subsidiary, Guest & Chrimes Limited. As at December 31, 2010, the remaining principal amount outstanding was £0.1 million that falls due for repayment, at par, on June 30, 2012. Until that time, in certain circumstances, each holder has the right to require full or part repayment, at par, half-yearly on June 30 and December 31 and for this reason these loan notes are classified as current liabilities.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

30. Borrowings continued

 

Currency and interest rate profile

The currency and interest rate profile of outstanding borrowings, after taking into account the effect of the Group’s currency and interest rate hedging activities, was as follows:

 

     Floating interest rate            Fixed interest rate            Interest-free         
      $ million     

Weighted
average
interest rate

%

             $ million     

Weighted
average
interest rate

%

     

Weighted
average
period for
which rate is
fixed

Years

             $ million     

Total

$ million

  

SUCCESSOR

                         

As at December 31, 2010

                         

Currency:

                         

– US dollar

      1,857.0         6.5%           1,169.7        8.9%        7.4 years           1.2         3,027.9  

– Sterling

      –         –           1.5        7.7%        1.5 years           0.9         2.4  

– Euro

      –         –           67.0        7.7%        1.5 years           –         67.0  

– Canadian dollar

      0.8         0.4%           31.9        7.7%        1.5 years           –         32.7  

– Other

      3.7         12.3%           27.8        7.7%        1.5 years           0.2         31.7  
       1,861.5              1,297.9                2.3         3,161.7  

PREDECESSOR

                         

As at January 2, 2010

                         

Currency:

                         

– US dollar

      549.8         2.3%           –         –         –           0.6         550.4   

– Sterling

      19.2         2.3%           –         –         –           1.0         20.2   

– Euro

      53.6         2.3%           –         –         –           –         53.6   

– Canadian dollar

      68.6         2.3%           –         –         –           –         68.6   

– Other

      10.1         4.9%           0.3         3.5%         3.9 years           0.1         10.5   
       701.3              0.3                 1.7         703.3   

 

31. Obligations under finance leases

 

     Minimum lease payments            Carrying amount  
     SUCCESSOR                   PREDECESSOR            SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                    

As at

January 2,

2010

$ million

            

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Amounts payable under finance leases

                             

Within one year

      0.7               1.3          0.5                 1.0  

In the second to fifth years, inclusive

      1.6               2.0          0.7                 1.1  

After more than five years

      2.6                         3.3                2.1                           2.5  
     4.9               6.6          3.3                 4.6  

Less: Future finance charges

      (1.6 )                        (2.0 )               –                           –   
       3.3                         4.6                3.3                           4.6  

The Group leases certain of its plant, equipment and vehicles under finance leases. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments. As at December 31, 2010, the average effective interest rate was 7.3% (January 2, 2010: 7.0%).

The Group’s obligations under finance leases are secured by the lessors’ title to the leased assets.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

32. Trade and other payables

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Current liabilities

              

Financial liabilities:

              

– Trade payables

      419.3                 419.6   

– Other taxes and social security

      25.1                 24.3   

– Derivative financial instruments (see note 33)

      0.9                 2.3   

– Other payables

      64.2                           48.0   
       509.5                           494.2   

Non-financial liabilities:

              

– Accruals and deferred income

      194.9                           183.4   
       704.4                           677.6   
 

Non-current liabilities

              

Financial liabilities:

              

– Derivative financial instruments (see note 33)

      48.3                 3.9   

– Other payables

      8.3                           14.3   
       56.6                           18.2   

Non-financial liabilities:

              

– Accruals and deferred income

      8.8                           8.9   
       65.4                           27.1   

Trade payables are generally not interest-bearing but interest may be charged by suppliers on overdue accounts.

 

33. Derivative financial instruments

Derivative financial instruments are held in relation to the Group’s financial risk management policy which is described in note 34. The Group does not hold or issue derivatives for speculative purposes.

The carrying amount of derivative financial instruments held by the Group was as follows:

 

                           SUCCESSOR                                       PREDECESSOR  
       As at December 31, 2010                     As at January 2, 2010  
        Assets
$ million		        Liabilities
$ million		       

Net

$ million

                       Assets
$ million		        Liabilities
$ million		     

Net

$ million

  

Hedging activities

                                   

Translational hedges:

                                   

– Currency swaps

        0.9           (1.4 )         (0.5 )                0.6          (3.6 )       (3.0 ) 

– Interest rate swaps

        –           –           –                            56.3          –         56.3  
       0.9           (1.4 )         (0.5 )                56.9          (3.6 )       53.3  

Transactional hedges:

                                   

– Currency forwards

        0.6           (0.1 )         0.5                 1.2          (1.9 )       (0.7 ) 

– Commodity contracts

        –           (0.8 )         (0.8 )                          –           (0.7 )       (0.7 ) 
         0.6           (0.9 )         (0.3 )                          1.2          (2.6 )       (1.4 ) 
         1.5           (2.3 )         (0.8 )                          58.1          (6.2 )       51.9  

Other items

                                   

Embedded derivatives

        –           (46.9 )         (46.9 )                          –           –         –   
         1.5           (49.2 )         (47.7 )                          58.1          (6.2 )       51.9  
 

Classified as:

                                   

– Current

        0.6           (0.9 )         (0.3 )                1.2          (2.3 )       (1.1 ) 

– Non-current

        0.9           (48.3 )         (47.4 )                          56.9          (3.9 )       53.0  
         1.5           (49.2 )         (47.7 )                          58.1          (6.2 )       51.9  

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

33. Derivative financial instruments continued

 

A. Currency derivatives

As at December 31, 2010, the notional principal amount of outstanding foreign exchange contracts that are used to manage the currency profile of the Group’s net assets was $438.0 million (January 2, 2010: $796.6 million). Where necessary, the Group has designated these contracts as net investment hedges. During Q4 2010, a net fair value loss of $2.5 million (9M 2010: gain of $0.5 million; Fiscal 2009: net loss of $3.1 million; Fiscal 2008: net gain of $57.2 million) in relation to designated net investment hedges was recognized in other comprehensive income.

The currency profile of the Group’s net assets after taking into account translation hedges is presented in note 34.

Also during Q4 2010, a net fair value loss of $0.6 million (9M 2010: loss of $0.1 million; Fiscal 2009: gain of $12.2 million; Fiscal 2008: loss of $9.4 million) was recognized within operating profit in respect of currency derivatives that were held to provide an economic hedge of transactional currency exposures but were not designated as hedges for accounting purposes.

B. Interest rate swaps

Until September 2010, the Group held interest rate swaps to swap the 2011 Notes and the 2015 Notes from fixed interest rates to floating interest rates. The Group had designated these contracts as fair value hedges in relation to the notes.

During 9M 2010, the Group recognized a net fair value gain of $17.3 million (Fiscal 2009: net loss of $13.3 million; Fiscal 2008: net gain of $75.7 million) in relation to these contracts and the carrying amount of the notes was increased by $19.0 million (Fiscal 2009: decreased by $12.3 million; Fiscal 2008: increased by $75.6 million) to reflect the change in the fair value of the notes attributable to the hedged risk and the amortization of the transitional adjustment that was recognized on adoption of IAS 39. During 9M 2010, a net loss of $1.7 million (Fiscal 2009: net loss of $1.0 million; Fiscal 2008: net gain of $0.1 million) was, therefore, recognized within other finance expense in relation to these hedges.

The profile of interest rate swaps held by the Group as at January 2, 2010 was as follows:

 

                Interest rate  
                Payable                 Receivable         
       

Notional
principal amount

million

       

Variable

%

     

Fixed

%

                 

Variable

%

       

Fixed

%

      Variable rate index  

As at January 2, 2010

                               

Maturity date:

                               

– December 2011

      £ 150.0           3.4 %       –                –           8.0 %       6 month LIBOR   

– September 2015

      £ 250.0           1.7 %       –                      –           6.1 %       3 month LIBOR   

On September 16, 2010, the Group sold the interest rate swaps for $64.7 million (plus accrued interest of $10.1 million).

Until December 2009, when the remaining contracts matured, the Group held interest rate swaps to swap to fixed interest rates a portion of the synthetic floating rate debt created by the fixed to floating interest swaps. During Fiscal 2009, a net fair value gain of $2.3 million (Fiscal 2008: net loss of $2.1 million) was recognized within other finance expense in relation to these contracts that did not qualify for hedge accounting under IAS 39.

C. Other items

Borrowings against the Senior Secured Credit Facilities bear interest at floating rates, subject to a floor (an embedded interest rate derivative). On inception of the facilities, the applicable market interest rate was lower than the floor. Consequently, the floor was required to be separated from each of the host loan contracts. As at December 31, 2010, the fair value of the embedded derivatives was $46.9 million and during Q4 2010 a gain of $22.9 million due to the change in their fair value was recognized as a credit to other finance expense.

During Fiscal 2008, the Group recognized a loss of $5.1 million in other finance expense to reduce to nil the carrying amount of an interest rate derivative embedded in a loan note that comprised part of the proceeds received on the disposal of one of the Group’s non-core businesses.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

34. Financial risk management

A. Risk management policies

The Group’s central treasury function is responsible for procuring the Group’s financial resources and maintaining an efficient capital structure, together with managing the Group’s liquidity, foreign exchange and interest rate exposures.

All treasury operations are conducted within strict policies and guidelines that are approved by the Board. Compliance with those policies and guidelines is monitored by the regular reporting of treasury activities to the Board.

A key element of the Group’s treasury philosophy is that funding, interest rate and currency decisions and the location of cash and debt balances are determined independently from each other. The Group’s borrowing requirements are met by raising funds in the most favorable markets. Management aims to retain a portion of net debt in the foreign currencies in which the net assets of the Group’s operations are denominated. The desired currency profile of net debt is achieved by entering into currency derivative contracts.

Management does not hedge the proportion of foreign operations effectively funded by shareholders’ equity. While the net income of foreign operations is not hedged, the effect of currency fluctuations on the Group’s reported net income is partly offset by interest payable on net debt denominated in foreign currencies.

From time to time, the Group also enters into currency derivative contracts to manage currency transaction exposures.

Where necessary, the desired interest rate profile of net debt in each currency is achieved by entering into interest rate derivative contracts.

The Group’s portfolio of cash and cash equivalents is managed such that there is no significant concentration of credit risk in any one bank or other financial institution. Management monitors closely the credit quality of the institutions with which it holds deposits. Similar considerations are given to the Group’s portfolio of derivative financial instruments.

The Group’s borrowing facilities are monitored against forecast requirements and timely action is taken to put in place, renew or replace credit lines. Management’s policy is to reduce liquidity risk by diversifying the Group’s funding sources and by staggering the maturity of its borrowings.

The Group has established long-term credit ratings of Ba3 Stable with Moody’s and BB- Negative with Standard & Poor’s. Credit ratings are subject to regular review by the credit rating agencies and may change in response to economic and commercial developments.

Management considers that the Group’s capital equates to shareholders’ equity.

Management manages the Group’s capital structure to maximize shareholder value whilst retaining flexibility to take advantage of opportunities that arise to grow the Group’s business.

B. Financial assets and liabilities

The following table analyses financial assets and liabilities by the categories defined in IAS 39. Financial instruments held at fair value, have been categorized into one of three levels to reflect the degree to which observable inputs are used in determining the fair values:

 

•  

‘Level 1’ fair value measurements are those derived without adjustment from quoted prices in active markets for identical assets or liabilities.

 

•  

‘Level 2’ fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

 

•  

‘Level 3’ fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

 

F-53

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

34. Financial risk management continued

 

B. Financial assets and liabilities (continued)

 

During the periods presented below, there were no transfers of financial instruments between Level 1 and Level 2.

 

SUCCESSOR                        Fair value through profit or loss                     
    

Loans and
receivables

$ million

     

Available-

for-sale

$ million

     

Liabilities

at amortized

cost

$ million

    

Designated

hedging

relationships

$ million

    

Held for

trading

$ million

    

Total

carrying

value

$ million

           

Fair

value

$ million

  

As at December 31, 2010

                    

Financial assets not held at fair value

                    

Trade and other receivables:

                    

– Non-derivative assets

      879.5        –         –        –        –        879.5          879.5  

Cash and cash equivalents

      459.3        –         –        –        –        459.3          459.3  
     1,338.8        –         –        –        –        1,338.8          1,338.8  

Financial assets held at fair value

                    

Level 1:

                    

– Available-for-sale investments

      –         1.4        –        –        –        1.4          1.4  

Level 2:

                    

– Trade and other receivables:

                    

Derivative assets

      –         –         –        0.9       0.6       1.5          1.5  
       –         1.4        –        0.9       0.6       2.9          2.9  

Total financial assets

      1,338.8        1.4        –        0.9       0.6       1,341.7          1,341.7  

Financial liabilities not held at fair value

                    

Trade and other payables:

                    

– Non-derivative liabilities

      –         –         (516.6 )      –        –        (516.6 )         (516.6 ) 

Bank overdrafts

      –         –         (7.1 )      –        –        (7.1 )         (7.1 ) 

Bank and other loans:

                    

– Current

      –         –         (255.7 )      –        –        (255.7 )         (290.2 ) 

– Non-current

      –         –         (2,898.9 )      –        –        (2,898.9 )         (3,201.0 ) 

Obligations under finance leases

      –         –         (3.3 )      –        –        (3.3 )         (3.3 ) 
       –         –         (3,681.6 )      –        –        (3,681.6 )         (4,018.2 ) 

Financial liabilities held at fair value

                    

Level 2:

                    

– Trade and other payables:

                    

Derivative liabilities

      –         –         –        (1.4 )      (47.8 )      (49.2 )         (49.2 ) 
       –         –         –        (1.4 )      (47.8 )      (49.2 )         (49.2 ) 

Total financial liabilities

      –         –         (3,681.6 )      (1.4 )      (47.8 )      (3,730.8 )         (4,067.4 ) 
       1,338.8        1.4        (3,681.6 )      (0.5 )      (47.2 )      (2,389.1 )         (2,725.7 ) 

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

34. Financial risk management continued

 

B. Financial assets and liabilities (continued)

 

PREDECESSOR          Fair value through profit or loss              
     

Loans and
receivables

$ million

     

Available-

for-sale

$ million

     

Liabilities

at amortized

cost

$ million

    

Designated

hedging

relationships

$ million

    

Held for

trading

$ million

    

Total

carrying

value

$ million

    

Fair

value

$ million

  

As at January 2, 2010

                 

Financial assets not held at fair value

                 

Trade and other receivables:

                 

– Non-derivative assets

      722.1        –         –        –        –        722.1       722.1  

Cash and cash equivalents

      445.0        –         –        –        –        445.0       445.0  
     1,167.1        –         –        –        –        1,167.1       1,167.1  

Financial assets held at fair value

                 

Level 1:

                 

– Available-for-sale investments

      –         1.2        –        –        –        1.2       1.2  

Level 2:

                 

– Trade and other receivables:

                 

Derivative assets

      –         –         –        56.9       1.2       58.1       58.1  
       –         1.2        –        56.9       1.2       59.3       59.3  

Total financial assets

      1,167.1        1.2        –        56.9       1.2       1,226.4       1,226.4  

Financial liabilities not held at fair value

                 

Trade and other payables:

                 

– Non-derivative liabilities

      –         –         (506.2 )      –        –        (506.2 )      (506.2 ) 

Bank overdrafts

      –         –         (4.8 )      –        –        (4.8 )      (4.8 ) 

Bank and other loans:

                 

– Current

      –         –         (11.2 )      –        –        (11.2 )      (10.2 ) 

– Non-current

      –         –         (642.3 )      (45.0 )      –        (687.3 )      (655.3 ) 

Obligations under finance leases

      –         –         (4.6 )      –        –        (4.6 )      (4.6 ) 
       –         –         (1,169.1 )      (45.0 )      –        (1,214.1 )      (1,181.1 ) 

Financial liabilities held at fair value

                 

Level 2:

                 

– Trade and other payables:

                 

Derivative liabilities

      –         –         –        (3.6 )      (2.6 )      (6.2 )      (6.2 ) 
       –         –         –        (3.6 )      (2.6 )      (6.2 )      (6.2 ) 

Total financial liabilities

      –         –         (1,169.1 )      (48.6 )      (2.6 )      (1,220.3 )      (1,187.3 ) 
       1,167.1        1.2        (1,169.1 )      8.3       (1.4 )      6.1       39.1  

Available-for-sale investments are listed and are valued by reference to quoted market prices.

Cash and cash equivalents largely attract floating interest rates. Accordingly, their carrying amounts are considered to be approximately fair value.

Bank and other loans principally comprise borrowings under the Senior Secured Credit Facilities, the 2011 Notes and the 2015 Notes, the Second Lien Notes and other loan notes. Borrowings under the Senior Secured Credit Facilities attract interest at floating rates and their principal amounts are considered to approximate to fair value. The 2011 Notes and the 2015 Notes are traded on the Professional Securities Market in London and their fair value is based on their quoted market prices. The Second Lien Notes and the other loan notes attract interest at fixed interest rates and their fair value has been assessed by reference to prevailing market interest rates.

Finance lease obligations attract fixed interest rates that are implicit in the lease rentals and their fair value has been assessed by reference to prevailing market interest rates.

Derivative assets and liabilities represent the fair value of foreign currency and interest rate derivatives held by the Group at the balance sheet date together with embedded interest rate derivatives that were required to be separated from their

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

34. Financial risk management continued

 

B. Financial assets and liabilities (continued)

 

host loan contracts. Foreign currency derivatives are valued by reference to prevailing forward exchange rates. Interest rate derivatives are valued by discounting the related cash flows using prevailing market interest rates. Embedded interest rate derivatives are valued using a valuation model by reference to prevailing market interest rates.

C. Credit risk

Credit risk is the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group.

Management considers the Group’s maximum exposure to credit risk to be as follows:

 

       SUCCESSOR                    PREDECESSOR  
       

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Trade and other receivables:

                

– Derivative assets

        1.5                 58.1  

– Non-derivative assets

        879.5                           722.1  
       881.0                 780.2  

Cash and cash equivalents

        459.3                           445.0  
         1,340.3                           1,225.2  

As at December 31, 2010, 95% (January 2, 2010: 94%) of the Group’s cash and cash equivalents were held with institutions rated at least A-1 by Standard & Poor’s or P-1 by Moody’s. Credit risk disclosures with respect to trade receivables are set out in note 26.

D. Liquidity risk

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities.

As at December 31, 2010, the Group had a committed revolving credit facility of $300.0 million that expires on September 29, 2015, which was undrawn for cash but against which there were outstanding letters of credit amounting to $40.3 million. Also, the Group had drawn $7.2 million (January 2, 2010: $6.0 million) against uncommitted borrowing facilities and had outstanding performance bonds, letters of credit and bank guarantees amounting to $66.0 million (January 2, 2010: $80.3 million), in addition to those outstanding under the revolving credit facility. Overall, therefore, the Group’s committed borrowing headroom was $186.5 million (January 2, 2010: $558.7 million), in addition to cash balances of $506.3 million (January 2, 2010: $447.1 million), including collateralized cash of $47.0 million (January 2, 2010: $2.1 million).

The Group is subject to covenants, representations and warranties in respect of the Senior Secured Credit Facilities including two financial covenants as defined in the credit agreement that were tested for the first time for the period ended December 31, 2010. Firstly, the ratio of ‘consolidated total debt’ to ‘consolidated EBITDA’ (the ‘total leverage ratio’) must not exceed 6.1 times (for the covenant test period ended December 31, 2010, the ratio was 4.23 times). Secondly, the ratio of ‘consolidated EBITDA’ to ‘consolidated net interest’ (the ‘interest coverage ratio’) must not be less than 1.8 times (for the covenant test period ended December 31, 2010, the ratio was 5.48 times).

Going forward, the compliance with these financial covenants will be tested for a period to the end of each calendar quarter. The limits against which the financial covenants are tested become progressively stricter for each test period until December 31, 2012. Thereafter, the total leverage ratio must not exceed 5.25 times and the interest coverage ratio must not be less than 2.10 times.

The limits for the forthcoming year are set out below:

 

       

Total leverage ratio

Must not exceed

       

Interest coverage ratio

Must not be less than

  

Covenant test period ended:

          

– March 31, 2011

        6.10 x           1.80 x   

– June 30, 2011

        6.10 x           1.80 x   

– September 30, 2011

        6.00 x           1.85 x   

– December 31, 2011

        5.75 x           1.95 x   

– March 31, 2012

        5.55 x           2.00 x   

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

34. Financial risk management continued

 

D. Liquidity risk (continued)

 

Any future non-compliance with the borrowing covenants could, if not waived, constitute an event of default and may, in certain circumstances, lead to an acceleration of the maturity of borrowings drawn down and the inability to access committed facilities.

Contractual cash flows related to the Group’s financial liabilities are as follows:

 

SUCCESSOR   

Within

1 year

$ million

    

Between

1 and 2

years

$ million

    

Between

2 and 3

years

$ million

    

Between

3 and 4

years

$ million

    

Between

4 and 5

years

$ million

    

After

5 years

$ million

    

Total

$ million

  

As at December 31, 2010

               

Bank overdrafts

      (7.1 )      –        –        –        –        –        (7.1 ) 

Bank and other loans:

               

– Principal

      (256.9 )      (46.6 )      (46.4 )      (46.4 )      (220.8 )      (2,743.3 )      (3,360.4 ) 

– Interest payments

      (243.5 )      (227.5 )      (224.0 )      (221.2 )      (215.9 )      (390.6 )      (1,522.7 ) 

Finance lease obligations

      (0.7 )      (0.4 )      (0.4 )      (0.4 )      (0.4 )      (2.6 )      (4.9 ) 

Trade and other payables:

               

– Non-derivative liabilities

      (508.6 )      (16.0 )      –        –        –        –        (524.6 ) 

Cash flows on non-derivative liabilities

      (1,016.8 )      (290.5 )      (270.8 )      (268.0 )      (437.1 )      (3,136.5 )      (5,419.7 ) 

Cash flows on derivative liabilities:

               

– Payments

      (180.7 )      –        –        –        –        –        (180.7 ) 

– Receipts

      178.5       –        –        –        –        –        178.5  
       (2.2 )      –        –        –        –        –        (2.2 ) 

Cash flows on financial liabilities

      (1,019.0 )      (290.5 )      (270.8 )      (268.0 )      (437.1 )      (3,136.5 )      (5,421.9 ) 

Cash flows on related derivative assets:

               

– Payments

      (292.4 )      –        –        –        –        –        (292.4 ) 

– Receipts

      292.3       –        –        –        –        –        292.3  
       (0.1 )      –        –        –        –        –        (0.1 ) 
       (1,019.1 )      (290.5 )      (270.8 )      (268.0 )      (437.1 )      (3,136.5 )      (5,422.0 ) 
PREDECESSOR   

Within

1 year

$ million

    

Between

1 and 2

years

$ million

    

Between

2 and 3

years

$ million

    

Between

3 and 4

years

$ million

    

Between

4 and 5

years

$ million

    

After

5 years

$ million

    

Total

$ million

  

As at January 2, 2010

               

Bank overdrafts

      (4.8 )      –        –        –        –        –        (4.8 ) 

Bank and other loans:

               

– Principal

      (0.6 )      (241.8 )      (0.3 )      (0.3 )      –        (403.1 )      (646.1 ) 

– Interest payments

      (44.4 )      (44.0 )      (24.7 )      (24.7 )      (24.7 )      (24.7 )      (187.2 ) 

Finance lease obligations

      (1.3 )      (0.8 )      (0.4 )      (0.4 )      (0.4 )      (3.3 )      (6.6 ) 

Trade and other payables:

               

– Non-derivative liabilities

      (491.9 )      (14.3 )      –        –        –        –        (506.2 ) 

Cash flows on non-derivative liabilities

      (543.0 )      (300.9 )      (25.4 )      (25.4 )      (25.1 )      (431.1 )      (1,350.9 ) 

Cash flows on derivative liabilities:

               

– Payments

      (255.7 )      (1.8 )      –        –        –        –        (257.5 ) 

– Receipts

      255.6       –        –        –        –        –        255.6  
       (0.1 )      (1.8 )      –        –        –        –        (1.9 ) 

Cash flows on financial liabilities

      (543.1 )      (302.7 )      (25.4 )      (25.4 )      (25.1 )      (431.1 )      (1,352.8 ) 

Cash flows on related derivative assets:

               

– Payments

      (612.7 )      (28.9 )      (20.6 )      (22.6 )      (23.8 )      (17.5 )      (726.1 ) 

– Receipts

      635.4       44.0       24.8       24.6       24.7       24.7       778.2  
       22.7       15.1       4.2       2.0       0.9       7.2       52.1  
       (520.4 )      (287.6 )      (21.2 )      (23.4 )      (24.2 )      (423.9 )      (1,300.7 ) 

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

34. Financial risk management continued

 

D. Liquidity risk (continued)

 

Information on the Group’s exposure to liquidity risk analyzed by currency is presented below.

 

SUCCESSOR   

Within

1 year

$ million

     

Between

1 and 2

years

$ million

     

Between

2 and 3

years

$ million

     

Between

3 and 4

years

$ million

     

Between

4 and 5

years

$ million

     

After

5 years

$ million

            

Total

$ million

  

As at December 31, 2010

                       

Cash flows on financial liabilities:

                       

– US dollar

      (384.9 )       (281.9 )       (268.8 )       (266.0 )       (408.5 )       (3,133.9 )         (4,744.0 ) 

– Sterling

      (240.5 )       (2.6 )       (1.6 )       (1.6 )       (28.2 )       –           (274.5 ) 

– Euro

      (149.2 )       (0.8 )       (0.4 )       (0.4 )       (0.4 )       (2.6 )         (153.8 ) 

– Canadian dollar

      (71.3 )       –         –         –         –         –           (71.3 ) 

– Other

      (173.1 )       (5.2 )       –         –         –         –                 (178.3 ) 
       (1,019.0 )       (290.5 )       (270.8 )       (268.0 )       (437.1 )       (3,136.5 )               (5,421.9 ) 

Cash flows on related financial assets:

                       

– US dollar

      (184.5 )       –         –         –         –         –           (184.5 ) 

– Sterling

      200.6        –         –         –         –         –           200.6  

– Euro

      (1.0 )       –         –         –         –         –           (1.0 ) 

– Canadian dollar

      0.8        –         –         –         –         –           0.8  

– Other

      (16.0 )       –         –         –         –         –                 (16.0 ) 
       (0.1 )       –         –         –         –         –                 (0.1 ) 
PREDECESSOR   

Within

1 year

$ million

     

Between

1 and 2

years

$ million

     

Between

2 and 3

years

$ million

     

Between

3 and 4

years

$ million

     

Between

4 and 5

years

$ million

     

After

5 years

$ million

           

Total

$ million

  

As at January 2, 2010

                       

Cash flows on financial liabilities:

                       

– US dollar

      (380.2 )       (10.7 )       –         –         –         –           (390.9 ) 

– Sterling

      75.0        (287.9 )       (25.0 )       (24.7 )       (24.7 )       (427.8 )         (715.1 ) 

– Euro

      (68.2 )       (1.2 )       (0.4 )       (0.4 )       (0.4 )       (3.3 )         (73.9 ) 

– Canadian dollar

      (37.9 )       –         –         –         –         –           (37.9 ) 

– Other

      (131.8 )       (2.9 )       –         (0.3 )       –         –           (135.0 ) 
       (543.1 )       (302.7 )       (25.4 )       (25.4 )       (25.1 )       (431.1 )         (1,352.8 ) 

Cash flows on related financial assets:

                       

– US dollar

      (330.1 )       –         –         –         –         –           (330.1 ) 

– Sterling

      479.4        15.1        4.2        2.0        0.9        7.2          508.8  

– Euro

      (44.2 )       –         –         –         –         –           (44.2 ) 

– Canadian dollar

      (62.3 )       –         –         –         –         –           (62.3 ) 

– Other

      (20.1 )       –         –         –         –         –           (20.1 ) 
       22.7        15.1        4.2        2.0        0.9        7.2          52.1  

Maturities of the financial liabilities in all of the liquidity tables above are based on the earliest date on which the counterparty has a contractual right to require payment. It should be noted that borrowings under the Senior Secured Credit Facilities would be required to be prepaid to the extent that the Group generates ‘excess cash’ as defined in the credit agreement and that, in the event of a change of control, the bank and other loans may have to be repaid and the undrawn committed borrowing facilities may be withdrawn.

Floating interest payments and payments and receipts on interest rate derivatives are estimated based on market interest rates prevailing at the balance sheet date.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

34. Financial risk management continued

 

E. Interest rate risk

Interest rate risk is the risk that the fair value of, or future cash flows associated with, a financial instrument will fluctuate because of changes in market interest rates.

The interest rate profile of the Group’s financial assets and liabilities, after taking into account the effect of the Group’s interest rate hedging activities, was as follows:

 

    SUCCESSOR                 PREDECESSOR  
    As at December 31, 2010                 As at January 2, 2010  
    Interest-bearing     Non-interest
bearing
$ million		     Total
$ million		                   Interest-bearing    

Non-interest
bearing

$ million

     Total
$ million		  
    

Floating

rate
$ million

    

Fixed

rate
$ million

            

Floating

rate
$ million

    

Fixed

rate
$ million

      

Financial assets

                      

Trade and other receivables

     47.9       8.0       825.1       881.0             16.0       –        764.2       780.2  

Available-for-sale investments

     –        –        1.4       1.4             –        –        1.2       1.2  

Cash and cash equivalents (see note 28)

     348.8       –        110.5       459.3                       378.9       –        66.1       445.0  
    396.7       8.0       937.0       1,341.7             394.9       –        831.5       1,226.4  
 

Financial liabilities

                      

Trade and other payables

     –        –        (565.8 )      (565.8 )            –        –        (512.4 )      (512.4 ) 

Borrowings (see note 30)

     (1,861.5 )      (1,297.9 )      (2.3 )      (3,161.7 )            (701.3 )      (0.3 )      (1.7 )      (703.3 ) 

Obligations under finance leases

     –        (3.3 )      –        (3.3 )                      –        (4.6 )      –        (4.6 ) 
      (1,861.5 )      (1,301.2 )      (568.1 )      (3,730.8 )                      (701.3 )      (4.9 )      (514.1 )      (1,220.3 ) 
      (1,464.8 )      (1,293.2 )      368.9       (2,389.1 )                      (306.4 )      (4.9 )      317.4       6.1  

On the assumption that the change in interest rates is applied to the Group’s financial assets and liabilities at the balance sheet date, an increase of 50 basis points in prevailing interest rates would decrease the Group’s loss before tax by $1.9 million and a decrease of 50 basis points would increase the Group’s loss before tax by $2.0 million. Borrowings under the Senior Secured Credit Facilities bear interest at floating rates, but are subject to a floor, which, as at December 31, 2010, was a LIBOR floor of 1.75%. If the LIBOR floor was not effective, an increase of 50 basis points in the prevailing interest rates applied to the Group’s financial assets and liabilities at the balance sheet date would increase the Group’s loss before tax by $8.0 million and a decrease of 50 basis points would decrease the Group’s loss before tax by $7.9 million.

F. Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. Currency risk arises on financial assets and liabilities that are denominated in a currency other than the functional currency of the entity by which they are held.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

34. Financial risk management continued

 

F. Currency risk (continued)

 

The Group’s exposure to currency risk, after taking into account currency transaction hedges, was as follows:

 

     Net foreign currency financial assets/(liabilities)  
      US dollar
$ million		     Sterling
$ million		     Euro
$ million		     Canadian dollar
$ million		     Other
$ million		     Total
$ million		  

SUCCESSOR

             

As at December 31, 2010

             

Functional currency of entity:

             

– US dollar

      –        (1.1 )      (2.2 )      –        (2.6 )      (5.9 ) 

– Sterling

      3.4       –        (2.7 )      –        (0.5 )      0.2  

– Euro

      (5.8 )      (4.6 )      –        (0.3 )      (0.1 )      (10.8 ) 

– Canadian dollar

      (4.2 )      (0.8 )      (0.5 )      –        (7.4 )      (12.9 ) 

– Other

      (9.7 )      (5.6 )      4.4       (1.3 )      –        (12.2 ) 
       (16.3 )      (12.1 )      (1.0 )      (1.6 )      (10.6 )      (41.6 ) 

PREDECESSOR

             

As at January 2, 2010

             

Functional currency of entity:

             

– US dollar

      –        (12.5 )      (1.1 )      –        (1.8 )      (15.4 ) 

– Sterling

      1.8       –        (2.6 )      –        (3.7 )      (4.5 ) 

– Euro

      (2.7 )      (0.2 )      –        (0.1 )      (0.1 )      (3.1 ) 

– Canadian dollar

      (3.0 )      –        –        –        (0.2 )      (3.2 ) 

– Other

      (5.1 )      (0.9 )      15.2       (0.6 )      –        8.6  
       (9.0 )      (13.6 )      11.5       (0.7 )      (5.8 )      (17.6 ) 

On the assumption that the change in exchange rates is applied to the risk exposures in existence at the balance sheet date and that designated net investment hedges are 100% effective, an increase or decrease of 10% in the value of the functional currencies of the entities concerned against the currencies in which the financial assets and liabilities are denominated would increase or decrease the Group’s loss before tax by $4.2 million (January 2, 2010: $1.8 million).

Currency translation exposures on the Group’s net assets, after taking into account currency translation, were as follows:

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Currency

              

– US dollar

      184.8                587.2   

– Sterling

      444.1                164.0   

– Euro

      336.8                117.2   

– Canadian dollar

      237.3                94.9   

– Other

      1,136.8                          714.7   
       2,339.8                          1,678.0   

 

35. Post-employment benefit obligations

A. Background

The Group operates pension plans throughout the world, covering the majority of its employees. The plans are structured to accord with local conditions and practices in each country and include defined contribution plans and defined benefit plans.

The Group provides defined contribution pension benefits in most of the countries in which it operates; in particular, the majority of the Group’s employees in the US are entitled to such benefits. Contributions payable by the Group to these plans during Q4 2010 amounted to $9.2 million (9M 2010: $22.0 million; Fiscal 2009: $33.4 million; Fiscal 2008: $37.9 million). At the balance sheet date, the Group had not paid over to the plans contributions due amounting to $16.1 million (January 2, 2010: $14.8 million). All amounts due for the period were paid over subsequent to the balance sheet date.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

35. Post-employment benefit obligations continued

 

A. Background (continued)

 

The Group operates defined benefit pension plans in several countries; in particular, in the US and the UK. Generally, the pension benefits provided under these plans are based upon pensionable salary and the period of service of the individual employees. The assets of the plans are held separately from those of the Group in funds that are under the control of trustees. All of the defined benefit pension plans operated by the Group are closed to new entrants. In addition to the funded defined benefit pension plans, the Group has unfunded defined benefit obligations to certain current and former employees.

The Group also provides other post-employment benefits, principally health and life insurance cover, to certain of its employees in North America. These plans, which are unfunded, are defined benefit plans.

B. Summary of financial effect

An analysis of the effect of providing post-employment benefits on the Group’s results is set out below.

 

SUCCESSOR    Pensions     Other post-employment benefits  
Q4 2010   

Operating

profit
$ million

     

Finance

charges
$ million

     Total
$ million		    

Operating

profit
$ million

     

Finance

charges
$ million

      Total
$ million		  
Defined contribution plans      9.2        –       9.2       –        –        –  

Defined benefit plans

                

Recognized in profit or loss:

                

– Current service cost

      1.2        –        1.2       –         –         –   

– Interest cost

      –         13.6       13.6       –         1.8        1.8  

– Expected return on plan assets

      –         (16.3 )      (16.3 )      –         –         –   
       1.2        (2.7 )      (1.5 )      –         1.8        1.8  

Recognized in equity:

                

– Net actuarial gain

           (60.1 )            (10.0 ) 

– Effect of the asset ceiling

                       20.2                         –   
                        (39.9 )                        (10.0 ) 
                        (41.4 )                        (8.2 ) 

 

PREDECESSOR

9M 2010

    Pensions     Other post-employment benefits  
  

Operating

profit
$ million

     

Finance

charges
$ million

     Total
$ million		    

Operating

profit
$ million

    

Finance

charges
$ million

      Total
$ million		  
Defined contribution plans      22.0        –        22.0       –        –         –   

Defined benefit plans

               

Recognized in profit or loss:

               

– Current service cost

      3.8        –        3.8       0.2       –         0.2  

– Settlement and curtailments

      1.0        –        1.0       (1.9 )      –         (1.9 ) 

– Interest cost

      –         44.8       44.8       –        5.6        5.6  

– Expected return on plan assets

      –         (44.7 )      (44.7 )      –        –         –   
       4.8        0.1       4.9       (1.7 )      5.6        3.9  

Recognized in equity:

               

– Net actuarial loss

           25.9            5.4  

– Effect of the asset ceiling

                       (0.3 )                       –   
                        25.6                        5.4  
                        30.5                        9.3  

 

F-61

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

35. Post-employment benefit obligations continued

 

B. Summary of financial effect (continued)

 

PREDECESSOR

Fiscal 2009

    Pensions     Other post-employment benefits  
  

Operating

profit
$ million

    

Finance

charges
$ million

     Total
$ million		    

Operating

profit
$ million

    

Finance

charges
$ million

      Total
$ million		  

Defined contribution plans

      33.4       –        33.4       –        –         –   

Defined benefit plans

              

Recognized in profit or loss:

              

– Current service cost

      6.7       –        6.7       0.4       –         0.4  

– Past service cost

      2.7       –        2.7       –        –         –   

– Negative past service cost

      (0.3 )      –        (0.3 )      (17.2 )      –         (17.2 ) 

– Settlement and curtailments

      (36.4 )      –        (36.4 )      (10.5 )      –         (10.5 ) 

– Interest cost

      –        61.0       61.0       –        9.0        9.0  

– Expected return on plan assets

      –        (62.6 )      (62.6 )      –        –         –   
       (27.3 )      (1.6 )      (28.9 )      (27.3 )      9.0        (18.3 ) 

Recognized in equity:

              

– Net actuarial loss

          119.8            24.0  

– Effect of the asset ceiling

                      (18.6 )                       –   
                       101.2                        24.0  
                       72.3                        5.7  

During Fiscal 2009, the Group recognized a gain of $63.0 million on the amendment of pension and post-retirement healthcare plans in North America (see note 9).

 

PREDECESSOR

Fiscal 2008

    Pensions     Other post-employment benefits  
  

Operating

profit
$ million

    

Finance

charges
$ million

     Total
$ million		    

Operating

profit
$ million

     

Finance

charges
$ million

      Total
$ million		  

Defined contribution plans

      37.9       –        37.9       –         –         –   

Defined benefit plans

               

Recognized in profit or loss:

               

– Current service cost

      8.7       –        8.7       0.5        –         0.5  

– Past service cost

      –        –        –        0.6        –         0.6  

– Settlement and curtailments

      (2.4 )      –        (2.4 )      –         –         –   

– Interest cost

      –        67.9       67.9       –         10.5        10.5  

– Expected return on plan assets

      –        (75.5 )      (75.5 )      –         –         –   
       6.3       (7.6 )      (1.3 )      1.1        10.5        11.6  

Recognized in equity:

               

– Net actuarial loss/(gain)

          122.4             (23.6 ) 

– Effect of the asset ceiling

                      (12.3 )                        –   
                       110.1                         (23.6 ) 
                       108.8                         (12.0 ) 

 

F-62

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

35. Post-employment benefit obligations continued

 

B. Summary of financial effect (continued)

 

The net liability recognized in the Group’s balance sheet in respect of defined benefit plans was as follows:

 

       SUCCESSOR                     PREDECESSOR  
       As at December 31, 2010                     As at January 2, 2010  
        Pensions
$ million		      Other benefits
$ million		        Total
$ million		                       Pensions
$ million		      Other benefits
$ million		        Total
$ million		  

Present value of the benefit obligation:

                                 

– Funded

        1,091.1         –           1,091.1                 1,071.7        –           1,071.7  

– Unfunded

        37.4         130.0          167.4                           44.3        142.1          186.4  
       1,128.5         130.0          1,258.5                 1,116.0        142.1          1,258.1  

Fair value of plan assets

        (1,011.1 )       –           (1,011.1 )                          (924.5 )       –           (924.5 ) 
       117.4         130.0          247.4                 191.5        142.1          333.6  

Effect of the asset ceiling

        28.2         –           28.2                           8.6        –           8.6  

Net liability

        145.6         130.0          275.6                           200.1        142.1          342.2  

The net liability is presented in the Group’s balance sheet as follows:

 

       SUCCESSOR                     PREDECESSOR  
       As at December 31, 2010                     As at January 2, 2010  
        Pensions
$ million		      Other benefits
$ million		        Total
$ million		                       Pensions
$ million		      Other benefits
$ million		        Total
$ million		  

Surpluses

        (3.6 )       –           (3.6 )                (1.3 )       –           (1.3 ) 

Deficits

        149.2         130.0          279.2                           201.4        142.1          343.5  

Net liability

        145.6         130.0          275.6                           200.1        142.1          342.2  

C. Pensions

The principal assumptions used in the actuarial valuations of the defined benefit pension plans were as follows:

 

        UK %
per annum		        US %
per annum		        Other
countries
% per annum		  

SUCCESSOR

               

Valuation as at December 31, 2010

               

Salary increases

        4.25           3.31           4.41   

Increase to pensions in payment

        3.50           n/a           1.75   

Increase to deferred pensions

        3.50           n/a           1.75   

Long-term rate of return on plan assets

        6.23           7.75           5.92   

Discount rate

        5.50           5.38           4.52   

Inflation rate

        3.50           n/a           2.20   

PREDECESSOR

               

Valuation as at January 2, 2010

               

Salary increases

        4.50%           3.36%           3.70%   

Increase to pensions in payment

        3.50%           n/a           n/a   

Increase to deferred pensions

        3.50%           n/a           n/a   

Long-term rate of return on plan assets

        6.31%           7.75%           6.02%   

Discount rate

        5.75%           5.75%           4.80%   

Inflation rate

        3.50%           n/a           1.39%   

 

F-63

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

35. Post-employment benefit obligations continued

 

C. Pensions (continued)

 

The current life expectancies underlying the benefit obligations of the Group’s principal pension plans were as follows:

 

            

UK

Years

       

US

Years

       

Other countries

Years

  

SUCCESSOR

                 

As at December 31, 2010

                 

Current pensioners (at age 65)

   – male        21.2           17.7           19.4   
  – female        24.2           20.3           21.8   

Future pensioners (at age 65)

   – male        22.2           17.7           19.4   
    – female        25.2           20.3           21.8   

PREDECESSOR

                 

As at January 2, 2010

                 

Current pensioners (at age 65)

   – male        21.2           17.7           19.1   
  – female        24.2           20.3           21.6   

Future pensioners (at age 65)

   – male        22.2           17.7           19.1   
  – female        25.2           20.3           21.6   

The net liability recognized in the Group’s balance sheet in respect of defined benefit pension plans was as follows:

 

     SUCCESSOR                   PREDECESSOR  
     As at December 31, 2010                   As at January 2, 2010  
      UK
$ million		     US
$ million		     Other
countries
$ million		     Total
$ million		                     UK
$ million		     US
$ million		     Other
countries
$ million		     Total
$ million		  

Present value of benefit obligation:

                         

– Funded

      367.3        572.9        150.9        1,091.1                366.7       565.3       139.7       1,071.7  

– Unfunded

      0.2        35.8        1.4        37.4                          0.1       36.6       7.6       44.3  
     367.5        608.7        152.3        1,128.5                366.8       601.9       147.3       1,116.0  

Fair value of plan assets

      (377.9 )      (513.5 )      (119.7 )      (1,011.1 )                        (353.7 )      (458.1 )      (112.7 )      (924.5 ) 
     (10.4 )      95.2        32.6        117.4                13.1       143.8       34.6       191.5  

Effect of the asset ceiling

      24.4        3.8        –        28.2                          8.6       –        –        8.6  

Net liability

      14.0        99.0        32.6        145.6                          21.7       143.8       34.6       200.1  

Changes in the present value of the benefit obligation were as follows:

 

                   SUCCESSOR  
                   Q4 2010  
      UK
$ million		     US
$ million		     Other
countries
$ million		     Total
$ million		  

At the beginning of the period

      –        –        –        –   

Acquisition of subsidiaries

      398.0        638.7        152.1        1,188.8   

Current service cost

      0.1        0.2        0.9        1.2   

Settlements

      –        (0.1 )      –        (0.1 ) 

Interest cost

      4.9        7.7        1.0        13.6   

Net actuarial gain

      (25.4 )      (22.2 )      (4.3 )      (51.9 ) 
     377.6        624.3        149.7        1,151.6   

Benefits paid

      (4.8 )      (15.6 )      (1.7 )      (22.1 ) 

Foreign currency translation

      (5.3 )      –        4.3        (1.0 ) 

At the end of the period

      367.5        608.7        152.3        1,128.5   

 

F-64

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

35. Post-employment benefit obligations continued

 

C. Pensions (continued)

 

                                                              PREDECESSOR  
     9M 2010            Fiscal 2009  
      UK
$ million		     US
$ million		     Other
countries
$ million		     Total
$ million		             UK
$ million		     US
$ million		     Other
countries
$ million		     Total
$ million		  

At the beginning of the period

      366.8       601.9       147.3       1,116.0          285.6       618.9       113.6       1,018.1  

Transfer of plans

      –        –        –        –           (5.0 )      5.0       –        –   

Current service cost

      0.3       0.5       3.0       3.8          0.6       2.0       4.1       6.7  

Past service cost

      –        –        –        –           –        –        2.7       2.7  

Negative past service cost

      –        –        –        –           –        (0.3 )      –        (0.3 ) 

Curtailments

      –        –        –        –           –        (29.1 )      (7.3 )      (36.4 ) 

Settlements

      –        –        1.0       1.0          –        (0.3 )      –        (0.3 ) 

Interest cost

      14.6       24.9       5.3       44.8          19.5       34.6       6.9       61.0  

Net actuarial loss

      37.1       47.1       6.2       90.4                54.1       22.6       24.7       101.4  
     418.8       674.4       162.8       1,256.0          354.8       653.4       144.7       1,152.9  

Employees’ contributions

      0.1       –        0.1       0.2          0.1       –        0.2       0.3  

Benefits paid

      (11.0 )      (35.7 )      (13.6 )      (60.3 )         (17.2 )      (51.5 )      (8.2 )      (76.9 ) 

Foreign currency translation

      (9.9 )      –        2.8       (7.1 )               29.1       –        10.6       39.7  

At the end of the period

      398.0       638.7       152.1       1,188.8                366.8       601.9       147.3       1,116.0  

Changes in the fair value of plan assets were as follows:

 

                   SUCCESSOR  
                   Q4 2010  
      UK
$ million		     US
$ million		     Other
countries
$ million		     Total
$ million		  

At the beginning of the period

      –        –        –        –   

Acquisition of subsidiaries

      372.0        515.9        111.4        999.3   

Expected return on plan assets

      5.7        9.1        1.5        16.3   

Settlements

      –        (0.1 )      –        (0.1 ) 

Net actuarial gain/(loss)

      7.3        (1.9 )      2.8        8.2   
     385.0        523.0        115.7        1,023.7   

Employer’s contributions

      2.8        6.1        3.0        11.9   

Benefits paid

      (4.8 )      (15.6 )      (1.7 )      (22.1 ) 

Foreign currency translation

      (5.1 )      –        2.7        (2.4 ) 

At the end of the period

      377.9        513.5        119.7        1,011.1   

 

    

PREDECESSOR

  
    

9M 2010

           

Fiscal 2009

  
     

UK

$ million

    

US

$ million

     Other
countries
$ million		    

Total

$ million

            

UK

$ million

    

US

$ million

     Other
countries
$ million		    

Total

$ million

  

At the beginning of the period

      353.7       458.1       112.7       924.5          294.0       479.5       88.6       862.1  

Expected return on plan assets

      15.7       24.4       4.6       44.7          21.2       35.5       5.9       62.6  

Settlements

      –        –        –        –           –        (0.3 )      –        (0.3 ) 

Net actuarial gain/(loss)

      7.9       57.4       (0.8 )      64.5                6.5       (31.8 )      6.9       (18.4 ) 
     377.3       539.9       116.5       1,033.7          321.7       482.9       101.4       906.0  

Employer’s contributions

      14.9       11.7       5.5       32.1          18.7       26.7       7.3       52.7  

Employees’ contributions

      0.1       –        0.1       0.2          0.1       –        0.2       0.3  

Benefits paid

      (11.0 )      (35.7 )      (13.6 )      (60.3 )         (17.2 )      (51.5 )      (8.2 )      (76.9 ) 

Foreign currency translation

      (9.3 )      –        2.9       (6.4 )               30.4       –        12.0       42.4  

At the end of the period

      372.0       515.9       111.4       999.3                353.7       458.1       112.7       924.5  

 

F-65

Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

35. Post-employment benefit obligations continued

 

C. Pensions (continued)

 

The fair value of plan assets by asset category was as follows:

 

    

SUCCESSOR

                   

PREDECESSOR

  
     

As at December 31, 2010

                   

As at January 2, 2010

  
     

UK

$ million

     

US

$ million

      Other
countries
$ million		     

Total

$ million

                     

UK

$ million

     

US

$ million

      Other
countries
$ million		     

Total

$ million

  

Equity instruments

      163.8        319.2        51.9        534.9                166.2        288.7        44.1        499.0  

Debt instruments

      213.7        165.4        45.3        424.4                187.4        153.0        46.9        387.3  

Other assets

      0.4        28.9        22.5        51.8                          0.1        16.4        21.7        38.2  
       377.9        513.5        119.7        1,011.1                          353.7        458.1        112.7        924.5  

Plan assets do not include any of the Group’s own financial instruments, nor any property occupied by, or other assets used by, the Group.

The return and risk expectations for each asset class incorporate assumptions about historical return relationships, current financial market conditions and the degree of global capital market integration. The assumptions used have been derived from rigorous historical performance analysis combined with forward-looking views of the financial markets as revealed through the yield on long-term bonds and the price earnings ratios of the major stock market indices. The actuaries review analyses of historical risk and the correlation of the return on asset classes and apply subjective judgment based on their knowledge of the Group’s plans. The result of this analysis is incorporated into a risk matrix from which expected long-term risk premiums for each asset class are developed.

The nominal return expectations are determined by combining the asset class risk premiums with expected inflation and real risk-free rate assumptions. As a final consideration, the nominal return assumptions are blended with current market conditions to develop long-term equilibrium expectations.

The Group’s investment strategy for pension plan assets includes diversification to minimize interest and market risks. Accordingly, the interest rate risk inherent in the benefit obligation of the Group’s US funded pension plans is hedged using a combination of bonds and interest rate swaps with a combined average duration of 10.2 years. In general, the investment strategy for the Group’s pension plans outside the US does not involve the use of derivative financial instruments.

Plan assets are rebalanced periodically to maintain target asset allocations. Maturities of investments are not necessarily related to the timing of expected future benefit payments, but adequate liquidity to make immediate and medium-term benefit payments is ensured.

The weighted averages of the expected returns on plan assets were as follows:

 

    

SUCCESSOR

                    PREDECESSOR  
              As at December 31,
2010		                            As at January 2, 2010              As at January 3, 2009  
      UK      US      Other
countries		                      UK      US      Other
countries		      UK      US      Other
countries		  

Equity instruments

      8.00 %       8.50 %       9.00 %               7.80 %       8.70 %       8.80 %       8.00 %       9.51 %       9.13 % 

Debt instruments

      3.98 %       4.20 %       3.89 %               4.92 %       5.20 %       5.31 %       4.83 %       6.40 %       4.87 % 

Other assets

      3.70 %       2.80 %       2.00 %                         4.20 %       3.30 %       2.00 %       4.30 %       3.90 %       1.00 % 

The actual return on plan assets was as follows:

 

       SUCCESSOR                  

PREDECESSOR

  
        Q4 2010                     9M
2010		      Fiscal
2009		      Fiscal
2008		  

UK

        3.5 %              8.9 %       9.4 %       (4.5 )% 

US

        1.4 %              23.8 %       0.8 %       (7.1 )% 

Other countries

        4.1 %                        4.6 %       7.1 %       (8.6 )% 

 

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35. Post-employment benefit obligations continued

 

C. Pensions (continued)

 

Actuarial gains and losses recognized in relation to defined benefit pension plans were as follows:

 

     SUCCESSOR                                             PREDECESSOR  
     

Q4 2010

$ million

                  

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

    

Fiscal 2007

$ million

    

Fiscal 2006

$ million

  

At the end of the period:

                   

– Present value of benefit obligation

      1,128.5             1,188.8       1,116.0       1,018.1       1,196.5       1,270.0  

– Fair value of plan assets

      (1,011.1 )                      (999.3 )      (924.5 )      (862.1 )      (1,125.0 )      (1,041.8 ) 

Deficit in the plans

      117.4                       189.5       191.5       156.0       71.5       228.2  
 

Recognized in the period:

                   

– Net actuarial gain/(loss) on plan assets

      51.9             64.5       (18.4 )      (145.5 )      (3.0 )      15.1  

– Net actuarial gain/(loss) on benefit obligation

      8.2                       (90.4 )      (101.4 )      23.1       92.9       25.6  
       60.1                       (25.9 )      (119.8 )      (122.4 )      89.9       40.7  

As at December 31, 2010, the cumulative net actuarial gain recognized in other comprehensive income amounted to $60.1 million (January 2, 2010: loss of $213.8 million).

Following negotiations with the trustees and regulatory authorities in connection with the acquisition of Tomkins, the Group agreed to make one-off contributions amounting to $23.0 million to certain of the defined benefit pension plans in the US and the UK of which $5.0 million was paid to the US plans during Q4 2010 and $18.0 million was paid to the UK plans in January 2011, and agreed to forego optional short-term pension funding relief in the US amounting to approximately $35.0 million. In addition, the Group expects to make contributions of approximately $46.9 million to defined benefit pension plans during 2011.

D. Other post-employment benefits

The weighted averages of the principal assumptions used in the actuarial valuations of the other post-employment benefit plans were as follows:

 

     SUCCESSOR                           PREDECESSOR  
     

As at

December 31,

2010

% per annum

                     

As at

January 2,

2010

% per annum

    

As at

January 3,

2009

% per annum

  

Discount rate

      5.28%                 5.63 %      6.08 % 

Medical cost inflation rate

      12.49%                           12.64 %      8.20 % 

The Group’s other post-employment benefit plans are unfunded. Accordingly, the liability recognized in the Group’s balance sheet in respect of these plans represents the present value of the benefit obligation.

Changes in the present value of the benefit obligation were as follows:

 

     SUCCESSOR                          PREDECESSOR  
     

Q4 2010

$ million

                    

9M 2010

$ million

    

Fiscal 2009

$ million

  

At the beginning of the period

      –                142.1       147.7  

Acquisition of subsidiaries

      140.9                –        –   

Current service cost

      –                –        0.4  

Negative past service cost

      –                –        (17.2 ) 

Settlements

      –                (1.7 )      –   

Curtailments

      –                –        (10.5 ) 

Interest cost

      1.8                5.6       9.0  

Net actuarial (gain)/loss

      (10.0 )                        5.4       24.0  
     132.7                151.4       153.4  

Benefits paid

      (3.6 )              (11.2 )      (14.9 ) 

Foreign currency translation

      0.9                          0.7       3.6  

At the end of the period

      130.0                          140.9       142.1  

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

35. Post-employment benefit obligations continued

 

D. Other post-employment benefits (continued)

 

Actuarial gains and losses recognized in relation to other post-employment benefit plans were as follows:

 

     SUCCESSOR                                                  PREDECESSOR  
     

Q4 2010

$ million

                     

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

     

Fiscal 2007

$ million

     

Fiscal 2006

$ million

  

At the end of the period:

                        

– Present value of benefit obligation

      130.0                           140.9        142.1       147.7        180.8        189.7  
 

Recognized in the period:

                        

– Actuarial gain/(loss) on benefit obligation

      10.0                           (5.4 )      (24.0 )      23.6        6.0        (2.7 ) 

As at December 31, 2010, the cumulative net actuarial gain recognized in other comprehensive income amounted to $10.0 million (January 2, 2010: net gain of $51.7 million).

Sensitivity to change in the assumed medical cost inflation rate used in the actuarial valuations as at December 31, 2010 is as follows:

 

      Increase of one
percentage point
$ million		      Decrease of one
percentage point
$ million		  

Effect on the aggregate of the current service cost and the interest cost

      0.4         (0.3 ) 

Effect on the accumulated benefit obligation

      7.4         (6.5 ) 

 

36. Share-based incentives

SUCCESSOR

A. Ongoing schemes

The Group operates a number of employee share schemes to provide incentives to the Group’s senior executives and other eligible employees.

Share options

Replacement Options

On the acquisition of Tomkins, certain executives who are not resident in the US were given the opportunity to cancel their vested awards under the Performance Share Plan (‘PSP’) that was operated by Tomkins Limited in exchange for awards of options, named the Replacement Options, to purchase equity interests in the Company. In the event, Replacement Options over 17,786 ‘B’ shares in the Company were granted to participating executives. Each Replacement Option has a nominal exercise price and vested immediately on grant. As such, the Replacement Options had a fair value at their grant date that was equal to the fair value of the vested awards under the PSP that they replaced, which was the equivalent of the offer price of 325 pence per ordinary share in Tomkins Limited. Accordingly, the fair value of the Replacement Options granted, which amounted to $34.9 million, was recognized by the Group as part of the consideration paid to acquire Tomkins.

Since the grant date, there has been no change in the number of Replacement Options that are outstanding. If the Replacement Options remain outstanding but unexercised, they will expire on the tenth anniversary of the grant date. As at December 31, 2010, the Replacement Options had a remaining contractual life of 9.75 years.

Variable Options

The Company has established an equity incentive plan under which the Group’s senior executives were granted options to purchase ‘B’ shares in the Company, named the Variable Options. The Variable Options are divided into three tiers with escalating exercise prices which allow the participants to share in the gains of the equity investors in the Company above certain minimum return thresholds.

The first tier options have an exercise price equal to the price at which the Consortium subscribed for shares in the Company at the time of the acquisition of Tomkins (the ‘Initial Exercise Price’) increasing at a compound rate of 8% per annum until the exercise date, subject to the additional condition that 3.184% of the options may not be exercised unless the fair market value of the underlying shares exceeds the exercise price of the second tier options and 3.409% of the options may not be exercised unless the fair market value of the underlying shares exceeds the exercise price of the

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

36. Share-based incentives continued

 

A. Ongoing schemes (continued)

 

third tier options. The second tier options have an exercise price equal to Initial Exercise Price increasing at a compound rate of 25% per annum until the exercise date (subject, in certain circumstances, to a cap of 2.25 times the Initial Exercise Price), subject to the additional condition that 3.409% of the options may not be exercised unless the fair market value of the underlying shares exceeds the exercise price of the third tier options. The third tier options have an exercise price equal to Initial Exercise Price increasing at a compound rate of 27.5% per annum until the exercise date (subject, in certain circumstances, to a cap of 2.5 times the Initial Exercise Price).

The Variable Options vested as to 25% immediately on grant, with a further 25% vesting on the first three anniversaries of the effective date of the acquisition of Tomkins, subject to the participant’s continuing employment by the Group on the vesting date. Vesting will be accelerated in the event of a change of control or a liquidity event while the participant is still employed by the Group and on a graduated basis for good leavers.

The fair value of the Variable Options at their grant date was measured using a Monte Carlo valuation model as follows:

 

        Q4 2010  

Fair value:

     

– First tier

        $1,164   

– Second tier

        $994   

– Third tier

        $933   

Inputs to the model:

     

– Share price at the grant date

        $1,966   

– Exercise price at the grant date

        $1,966   

– Expected volatility

        83.5%   

– Expected life

        5 years   

– Risk-free interest rate

        1.37%   

– Expected dividends

        nil   

The Monte Carlo valuation model simulates the share price on the exercise date assuming the share price follows geometric Brownian motion. Based on the simulated share price, the model calculates the exercise price in accordance with the rules of the scheme and applies the discount factor to the resulting simulated payoff on exercise of the option. The model is run for a large number of simulations and the fair value of the option is determined as the average payoff on exercise of the option over those simulations.

The Company is an unlisted entity but it was considered that Tomkins plc was a similar listed entity. Expected volatility of the price of the ‘B’ shares in the Company was therefore determined using the Merton model based on the historical volatility of the market price of Tomkins plc’s ordinary shares over the expected life of the options having made adjustments to reflect the higher leverage ratio of the Company compared with that of Tomkins plc.

The expected life of the options reflects the effects of non-transferability, exercise restrictions and behavioral considerations.

Since the grant date, there has been no change in the number of Variable Options that remain outstanding. Details of the Variable Options outstanding as at December 31, 2010 were as follows:

 

       As at December 31, 2010  
        Options
Number		       

Exercise

Price

$

  

First tier

        113,034         $ 2,002   

Second tier

        37,674         $ 2,072   

Third tier

        37,685         $ 2,082   
         188,393        

Exercisable

        44,913        

If the Variable Options remain outstanding but unexercised, they will expire on the tenth anniversary of the grant date. As at December 31, 2010, the Variable Options had a remaining contractual life of 9.75 years.

During Q4 2010, the compensation expense recognized in relation to the Variable Options was $72.2 million.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

36. Share-based incentives continued

 

A. Ongoing schemes (continued)

 

Other share awards

Retention Awards

Following the acquisition of Tomkins, awards over 3,645 ‘B’ shares in the Company, named the Retention Awards, were granted to certain executives. Retention Awards are deferred shares that normally become vested as to one-third of the award on the first three anniversaries of the effective date of the acquisition of Tomkins subject to the participant’s continuing employment by the Group at the vesting date. Vesting will be accelerated in the event of a change of control or a liquidity event while the participant is still employed by the Group, if the holder dies, has his or her employment terminated due to disability or without cause or resigns for good reason.

On the principal assumption that there will be no dividend payments during the vesting period, the fair value on the grant date of the Retention Awards was $1,966. During Q4 2010, the compensation expense recognized in relation to the Retention Awards was $0.2 million.

Annual Bonus Incentive Plan

Bonuses payable and accrued under the Annual Bonus Incentive Plan (‘ABIP’) during the transitional period between the acquisition of Tomkins and December 31, 2010 have been and are to be settled wholly in cash. While ABIP will continue in 2011, the nature of the share-based element of the plan has not yet been finalized.

B. Legacy schemes

While most of the awards and options that were outstanding under the employee share schemes that were operated by Tomkins Limited were exercised, settled or replaced at the time of the acquisition of Tomkins, there remained outstanding a number of options over ordinary shares in Tomkins Limited that had vested but had not been exercised by the optionholders. Under the terms of the acquisition agreement, these options remain exercisable in accordance with the rules of the relevant schemes. Accordingly, they are recognized by the Group as non-controlling interests in Tomkins Limited measured at their fair value at the acquisition date.

Movements in the number of options outstanding over ordinary shares in Tomkins Limited were as follows:

 

     Q4 2010  
      Options
Number		    

Weighted average
exercise price

Pence

  

As at September 25, 2010

      9,597,537        242p   

Exercised

      (10,590 )      218p   

Expired

      (54,319 )      217p   

As at December 31, 2010

      9,532,628        243p   

Exercisable as at December 31, 2010

      9,532,628     

If the options are exercised, the requisite number of ordinary shares will be issued by Tomkins Limited and immediately acquired by the Group for consideration of 325 pence per share in cash.

If the options outstanding as at December 31, 2010 remain unexercised, they will expire as follows:

 

      Options
Number		  

Expiry:

   

– June 2011

      5,626,142   

– January 2013

      1,440,576   

– December 2013

      1,178,880   

– April 2014

      1,287,030   
       9,532,628   

At the time of the acquisition of Tomkins, options over 2,865,528 ordinary shares in Tomkins Limited were outstanding under the Tomkins Sharesave Scheme.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

36. Share-based incentives continued

 

B. Legacy schemes (continued)

 

In view of the fact that certain participants would lose preferential tax treatment as a consequence of the acquisition of Tomkins and/or would not be able to exercise their options in full at the time of the acquisition, the Group agreed to make an ex gratia payment to those participants who chose to exercise their options conditionally on the acquisition becoming effective of an amount equal to the aggregate of (i) an amount which, after deduction of income tax and national insurance contributions, equaled the income tax, if any, payable on the exercise of such options and (ii) an amount which, after deduction of income tax and national insurance contributions, equaled the additional profit which the participant would have received if the participant had been able to exercise his or her options in full at the date of acquisition. In the event, the ex gratia payment amounted to $11.3 million, of which $2.4 million was recognized by the Group as part of the consideration paid to acquire Tomkins and $8.9 million was recognized as an expense within acquisition costs.

Subsequent to the acquisition, there remained 64,909 options outstanding under the Tomkins Sharesave Scheme, which either had been exercised or had expired as at December 31, 2010.

PREDECESSOR

Prior to its acquisition by the Group, Tomkins plc operated a number of employee share schemes to provide incentives to the Group’s senior executives and other eligible employees. Options and awards made under these schemes were in respect of Tomkins plc’s ordinary shares. Although Tomkins plc’s ordinary shares were denominated in US dollars, they were quoted in sterling on the London Stock Exchange.

A. Share options

Options were granted from time to time under the Tomkins Sharesave Scheme, which was restricted to employees who are resident for tax purposes in the UK. It offered eligible employees the option to buy ordinary shares in Tomkins plc after a period of three, five or seven years, funded from the proceeds of a savings contract to which employees contributed up to £250 per month.

Vested options remained outstanding under Tomkins plc’s executive share option schemes which lapsed for the purpose of new awards in 2005. The final unvested options under these schemes vested during 2007.

In 9M 2010, the compensation expense in respect of share options was $0.7 million, of which $0.5 million was accelerated due to the early vesting of options on the acquisition of Tomkins. In Fiscal 2009, the compensation expense in respect of share options was $1.0 million (Fiscal 2008: $0.8 million).

Changes in the total number of share options outstanding during the period were as follows:

 

     9M 2010             Fiscal 2009  
      Options
Number		     Weighted
average
exercise
price
Pence		              Options
Number		     Weighted
average
exercise
price
Pence		  

Outstanding at the beginning of the period

      17,248,301       224.24            18,131,583       238.60   

Granted during the period

      308,264       188.56            2,228,492       96.00   

Cancelled during the period

      (8,674 )      280.94            (634,716 )      157.70   

Forfeited during the period

      (49,951 )      115.39            (34,770 )      202.88   

Exercised during the period

      (4,196,081 )      220.95            (45,000 )      170.50   

Lapsed during the period

      (1,421,790 )      252.81            (2,397,288 )      232.61   

Settled

      (1,860,532 )      114.36           –        –   

Outstanding at the end of the period

      10,019,537       241.36           17,248,301       224.24   

Exercisable at the end of the period

      10,019,537       241.36           14,544,405       245.19   

On the dates on which options were exercised during 9M 2010, the weighted average market price of Tomkins plc’s ordinary shares was 317.52p per share (Fiscal 2009: 178.90p per share).

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

36. Share-based incentives continued

 

A. Share options (continued)

 

The fair value of options granted under the Sharesave Scheme was measured at their respective grant dates using the Black-Scholes option pricing formula based on the following assumptions:

 

      9M 2010      Fiscal 2009      Fiscal 2008  

Weighted average fair value

      97.96p         68.34p         37.99p   

Weighted average assumptions:

         

– Share price

      247.40p         161.75p         176.75p   

– Exercise price

      188.56p         96.00p         140.20p   

– Expected volatility

      40.34%         33.44%         24.59%   

– Expected life

      4.31 years         4.47 years         4.57 years   

– Risk-free interest rate

      2.60%         3.76%         4.55%   

– Expected dividends

      6.53p         6.25p         13.89p   

Expected volatility was determined based on the historical volatility of the market price of Tomkins plc’s ordinary shares over the expected life of the options. Adjustments have been made to the expected life used in the model to reflect the effects of non-transferability, exercise restrictions and behavioral considerations.

The weighted average contractual life of share options outstanding as at January 2, 2010 was as follows:

 

     As at January 2, 2010  
      Outstanding
Number		     

Weighted

average

remaining
contractual life

Years

  

Range of exercise prices:

      

– Less than 100p

      2,186,005         4.13   

– 100p to 150p

      287,096         3.21   

– 151p to 200p

      3,242,072         2.06   

– 201p to 250p

      5,909,124         4.08   

– 251p to 300p

      4,608,776         3.31   

– 301p and higher

      1,015,228         2.11   
       17,248,301      

B. Other share awards

The Group’s principal share-based compensation arrangements were the Annual Bonus Incentive Plan (‘ABIP’) and the Performance Share Plan (‘PSP’). Both were restricted to the Group’s senior executives.

Certain executives of Tomkins participated in the ABIP under which each participant received a bonus which represents a percentage of the ‘bonusable profit’ of the business for which he or she had responsibility. Bonuses were determined based on bonusable profit for the calendar year. Interim payments were made quarterly in June, September and December based on 75% of bonusable profit for the year to date and the balance of the bonus for the year was paid in March of the following year. Senior participants normally received their bonus as to four-sevenths in cash, one seventh in Restricted Award Shares and two-sevenths in Deferred Award Shares. Other participants normally received their bonus as to three-quarters in cash, one twelfth in Restricted Award Shares and one sixth in Deferred Award Shares. Restricted awards vested immediately on grant. Dividends were paid on the Restricted Shares. Deferred awards did not vest until three years after the end of the quarter to which the bonus related, subject to the participant’s continuing employment by the Group at the vesting date. If the participant ceased to be employed by the Group, the deferred awards vested on a pro-rata basis. Dividends were not paid on the Deferred Award Shares until they had vested. During Fiscal 2009, awards were granted over 999,108 ordinary shares (Fiscal 2008: 1,789,628 ordinary shares) under the ABIP.

In Fiscal 2009, the Interim Bonus Plan (‘IBP’) was introduced as a temporary, one-year substitute for the ABIP. The IBP differed from the ABIP only in that bonuses accruing under the plan were based on the trading cash flow of the business for which the participants had responsibility and on the attainment of strategic achievement milestones that were set for each of the participants and the quarterly phasing of awards was suspended. In March 2010, awards were granted over 1,748,274 ordinary shares, which represented the share element of bonuses earned under the IBP during Fiscal 2009.

 

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36. Share-based incentives continued

 

B. Other share awards (continued)

 

The ABIP was reinstated for 2010. In June 2010, awards were granted over 482,749 ordinary shares, which represented the share element of bonuses earned under the ABIP in the first quarter of 2010. As a consequence of the acquisition of Tomkins, the share-based element of the ABIP was suspended and bonuses earned in the second and third quarters of 2010 were settled entirely in cash.

The PSP provided awards of shares which vested after a period of three years, conditional on the Group’s total shareholder return relative to its cost of equity over the vesting period and the participant’s continued employment with the Group. During 9M 2010, awards were granted over 5,558,211 ordinary shares under the PSP (Fiscal 2009: 6,894,193 ordinary shares; Fiscal 2008: 7,115,194 ordinary shares).

The fair value of awards made under the ABIP and the IBP was measured based on the market price of the Tomkins plc’s ordinary shares on the date of the award. Where the awards did not attract dividends during the vesting period, the market price was reduced by the present value of the dividends that were expected to be paid during the expected life of the awards. The weighted average fair value of awards made under these schemes during 9M 2010 was 219.8p (Fiscal 2009: 130.46p; Fiscal 2008: 125.66p).

The fair value of awards made under the PSP was measured at their respective grant dates using a Monte Carlo valuation model based on the following assumptions:

 

      9M 2010      Fiscal 2009      Fiscal 2008  

Weighted average fair value

      63.70p         41.92p         43.92p   

Weighted average assumptions:

         

– Expected volatility

      48.00%         45.36%         36.41%   

– Expected life

      3.00 years         3.00 years         3.00 years   

– Risk-free interest rate

      1.90%         2.00%         4.71%   

– Dividend yield

      3.23%         4.87%         8.84%   

Expected volatility was determined based on the historical volatility of the market price of Tomkins plc’s ordinary shares over the expected life of the awards.

In 9M 2010, the compensation expense in respect of other share awards was $20.5 million, of which $13.0 million was accelerated due to the early vesting or lapsing of awards on the acquisition of Tomkins. In Fiscal 2009, the compensation expense in respect of other share awards was $10.3 million (Fiscal 2008: $11.2 million).

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

37. Deferred tax

Movements in the net deferred tax assets and (liabilities) recognized by the Group were as follows:

 

     

Post-
employment
benefits

$ million

     Tax
losses
$ million		    

Net investment

in subsidiaries
$ million

     Accrued
expenses
$ million		     Long-
lived
assets
$ million		     Inventories
$ million		     Other
items
$ million		     Total $
million		  

SUCCESSOR

                 

As at September 25, 2010

      –        –        –        –        –        –        –        –   

Acquisition of subsidiaries

      99.3       37.8       (77.8 )      41.2       (863.8 )      (72.3 )      23.3       (812.3 ) 

(Charge)/credit to profit or loss

      (4.1 )      (4.9 )      (6.8 )      2.5       19.3       44.3       (0.3 )      50.0  

Charged outside profit or loss

      (15.8 )      –        –        –        –        –        (0.1 )      (15.9 ) 

Currency translation differences

      0.1       (0.1 )      –        0.3       (2.3 )      0.3       –        (1.7 ) 

As at December 31, 2010

      79.5       32.8       (84.6 )      44.0       (846.8 )      (27.7 )      22.9       (779.9 ) 

PREDECESSOR

                 

As at January 3, 2009

      97.7       4.6       (3.3 )      42.0       (95.9 )      (44.1 )      34.1       35.1  

Acquisition of subsidiaries

      –        –        –        –        (6.9 )      –        –        (6.9 ) 

(Charge)/credit to profit or loss

      (15.5 )      11.5       (2.0 )      0.3       2.5       15.0       1.9       13.7  

Credited outside profit or loss

      14.9       –        –        –        –        –        0.7       15.6  

Currency translation differences

      0.1       0.4       –        0.6       (0.8 )      0.1       (0.3 )      0.1  

As at January 2, 2010

      97.2       16.5       (5.3 )      42.9       (101.1 )      (29.0 )      36.4       57.6  

Acquisition of subsidiaries

      –        –        –        0.1       (2.6 )      0.1       –        (2.4 ) 

(Charge)/credit to profit or loss

      (7.4 )      1.0       2.2       (2.5 )      0.4       (3.1 )      3.1       (6.3 ) 

Credited outside profit or loss

      –        –        –        –        –        –        4.8       4.8  

Currency translation differences

      0.3       (0.7 )      –        0.2       0.2       (0.2 )      0.1       (0.1 ) 

As at September 24, 2010

      90.1       16.8       (3.1 )      40.7       (103.1 )      (32.2 )      44.4       53.6  

Deferred tax assets and liabilities presented in the Group’s balance sheet are as follows:

 

     SUCCESSOR                   PREDECESSOR  
     

As at

December 31,

2010

$ million

                    

As at

January 2,

2010

$ million

  

Deferred tax assets

             

– Ongoing businesses

      9.6               82.9  

– Businesses to be sold (see note 29)

      3.8                         –   
     13.4               82.9  

Deferred tax liabilities

      (793.3 )                        (25.3 ) 
       (779.9 )                        57.6  

As at December 31, 2010:

 

•  

the Group had operating tax losses amounting to $2,046.2 million, of which $1,722.6 million can be carried forward indefinitely and $323.6 million have expiry dates between 2011 and 2030 (the Group recognized a deferred tax asset of $32.4 million in respect of these losses);

 

•  

the Group had capital tax losses amounting to $832.2 million, of which $436.4 million can be carried forward indefinitely and $395.8 million expire between 2012 and 2015, with $386.8 million expiring in 2013 (the Group recognized a deferred tax asset of $0.4 million in respect of these losses); and

 

•  

the Group had foreign and other tax credits amounting to $52.2 million, of which $16.7 million can be carried forward indefinitely and $35.5 million expire between 2013 and 2026 (the Group recognized no deferred tax asset in respect of these tax credits).

As at December 31, 2010, the aggregate amount of temporary differences associated with investments in subsidiaries for which deferred tax liabilities have not been recognized was $1,375.0 million (January 2, 2010: $790.9 million).

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

38. Provisions

 

     

Restructuring

costs
$ million

     Environmental
remediation
$ million		     Workers’
compensation
$ million		    

Warranty

provisions
$ million

     Product
liability
provisions
$ million		    

Other

provisions
$ million

     Total
$ million		  

SUCCESSOR

               

As at September 25, 2010

      –        –        –        –        –        –        –   

Acquisition of subsidiaries

      39.5       12.5       20.4       12.2       9.5       9.1       103.2  

Charge for the period

      0.1       0.8       4.4       2.7       1.8       0.1       9.9  

Utilized during the period

      (10.4 )      (1.1 )      (2.9 )      (2.3 )      (3.0 )      –        (19.7 ) 

Released during the period

      (1.8 )      (0.3 )      (0.3 )      (0.5 )      –        –        (2.9 ) 

Foreign currency translation

      0.4       0.1       –        –        –        –        0.5  

As at December 31, 2010

      27.8       12.0       21.6       12.1       8.3       9.2       91.0  

PREDECESSOR

               

As at January 3, 2009

      15.9       7.4       25.5       11.5       7.4       4.3       72.0  

Charge for the period

      117.8       4.4       8.9       5.3       15.6       –        152.0  

Utilized during the period

      (58.4 )      (5.6 )      (11.1 )      (4.7 )      (11.7 )      –        (91.5 ) 

Released during the period

      (8.1 )      (0.1 )      (1.4 )      (1.1 )      (1.4 )      (4.1 )      (16.2 ) 

Foreign currency translation

      1.7       0.4       0.1       0.3       0.1       0.6       3.2  

As at January 2, 2010

      68.9       6.5       22.0       11.3       10.0       0.8       119.5  

Charge for the period

      8.5       2.0       9.2       7.2       7.4       0.1       34.4  

Utilized during the period

      (30.3 )      (2.1 )      (10.2 )      (4.5 )      (9.4 )      –        (56.5 ) 

Released during the period

      (5.2 )      –        (0.9 )      (1.8 )      (0.1 )      –        (8.0 ) 

Foreign currency translation

      (2.4 )      –        –        –        (0.2 )      –        (2.6 ) 

As at September 24, 2010

      39.5       6.4       20.1       12.2       7.7       0.9       86.8  

Provisions are presented in the Group’s balance sheet as follows:

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Ongoing businesses:

              

– Current liabilities

      65.6                 100.3   

– Non-current liabilities

      24.7                           19.2   
     90.3                 119.5   

Businesses to be sold (see note 29)

      0.7                           –   
       91.0                           119.5   

Provisions for restructuring costs are expected largely to be utilized during 2011.

 

39. Share capital and reserves

SUCCESSOR

A. Authorized and issued, fully paid shares of Pinafore Holdings B.V.

 

     Preferred ‘A’ shares of  €3,600 each            Ordinary ‘B’ shares of  €0.01 each  
     

Authorized

Number

of shares

     

Issued

Number

of shares

            

Authorized

Number

of shares

     

Issued

Number

of shares

  

As at September 25, 2010 and December 31, 2010

      10         2                 5,400,000         1,080,000   

B. Share capital

The Company’s authorized share capital consists of two classes of shares: the preferred ‘A’ shares of €3,600 each; and the ordinary ‘B’ shares of one eurocent (€0.01) each.

Share capital represents the nominal value of the shares issued.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

39. Share capital and reserves continued

 

B. Share capital (continued)

 

On September 1, 2010, the date on which the Company was incorporated, two ‘A’ shares and 1,080,000 ‘B’ shares were issued for cash at their nominal value. On September 27, 2010, the holder of the ‘B’ shares subscribed an additional amount of €1,578.3 million by way of a contribution to share premium. The Company used the amount of the contribution to subscribe for additional shares in its wholly-owned subsidiary, Tomkins Acquisitions Limited, which, in turn, used the contribution to partially fund the acquisition of Tomkins.

Shareholders have no entitlement to share in the profits of the Company, except for dividends that have been declared and in the event of its liquidation. Dividends may be paid out of profits allocated to the Shareholders and from their respective share premium accounts. Any profit earned in a financial year is allocated to the Shareholders after the adoption of the annual accounts for the financial year at a General Meeting of the Shareholders. Each of the ‘A’ shares is entitled to a cumulative profit allocation of €1,000 in respect of the financial year. Any profit for the financial year remaining after the allocation of profit to the ‘A’ shares is allocated to the ‘B’ shares on a pro rata basis. Dividends may be declared only on a resolution of the Shareholders in General Meeting and may not exceed the amount of the Company’s distributable reserves as determined in accordance with Dutch law (which currently comprises the excess of the Company’s net assets over its issued share capital).

Shareholders have the right to attend, and vote at, general meetings of the Company or to appoint a proxy to attend and vote at such meetings on their behalf. A General Meeting of the Shareholders shall take place at least once each year and no later than six months after the end of the previous financial year. Each ‘A’ share has the right to cast 360,000 votes and each ‘B’ share has the right to cast one vote. Resolutions of a General Meeting may generally only be adopted with a majority of the votes cast. In the event of a tie of votes, the resolution shall be rejected. Resolutions of a General Meeting may also be adopted in writing without recourse to a meeting, provided they are adopted by a unanimous vote of all Shareholders.

C. Shares to be issued

Following the acquisition of Tomkins, certain members of the Tomkins management team invested in the Group by way of subscribing for ‘B’ shares in the Company. In total, the participating members of the Tomkins management team subscribed for 8,838 ‘B’ shares for the Euro equivalent of $17.4 million in cash. As at December 31, 2010, the shares had not yet been registered in the names of the participants.

D. Share premium account

The share premium accounts record the difference between the nominal value of shares issued and the fair value of the consideration received. The Company maintains two share premium accounts so as to record the premium on the issue of the ‘A’ shares separately from the premium on the issue of the ‘B’ shares. Provided the Company has sufficient distributable profits as determined in accordance with Dutch law, the holders of the ‘A’ shares and the ‘B’ shares may resolve in a General Meeting of their respective classes of shares to pay dividends from their respective share premium accounts.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

39. Share capital and reserves continued

 

PREDECESSOR

A. Authorized and issued, fully paid shares of Tomkins plc

 

     Ordinary shares of 9c each             Ordinary shares of 5p each            Deferred shares of £1 each  
     

Authorized

Number

of shares

     

Issued

Number

of shares

             

Authorized

Number

of shares

    

Issued

Number

of shares

            

Authorized

Number

of shares

    

Issued

Number

of shares

  

As at 29 December 2007

      –         –            1,585,164,220        884,106,772          –        –   

Fiscal 2008

                     

Shares issued before redenomination:

                     

– Exercise of employee share options

      –         –            –        45,000          –        –   

Redenomination:

                     

– Cancellation of 5p ordinary shares

      –         –            (1,585,164,220 )      (884,151,772 )         –        –   

– Issue of 9c ordinary shares

      1,585,164,220         884,151,772           –        –           –        –   

– Issue of deferred shares

      –         –                  –        –                 50,000       50,000  

As at January 3, 2009

      1,585,164,220         884,151,772           –        –           50,000       50,000  

Fiscal 2009

                     

Shares issued during the period:

                     

– Exercise of employee share options

      –         45,000           –        –           –        –   

Cancellation of deferred shares

      –         –                  –        –                 (50,000 )      (50,000 ) 

As at January 2, 2010

      1,585,164,220         884,196,772           –        –           –        –   

9M 2010

                     

Shares issued during the period:

                     

– Exercise of employee share options

      –         4,960,521                 –        –                 –        –   

As at September 24, 2010

      1,585,164,220         889,157,293                 –        –                 –        –   

B. Ordinary shares

On 22 May 2008, the Tomkins plc’s ordinary shares were redenominated from sterling to US dollars. The redenomination did not affect the rights of the holders of ordinary shares.

Ordinary shareholders have no entitlement to share in the profits of Tomkins plc, except for dividends that have been declared and in the event of its liquidation.

Ordinary shareholders have the right to attend, and vote at, general meetings of Tomkins plc or to appoint a proxy to attend and vote at such meetings on their behalf. Ordinary shareholders have one vote for every share held.

Ordinary share capital represents the nominal value of ordinary shares issued.

C. Deferred shares

When Tomkins plc redenominated its ordinary shares from sterling to US dollars, it was required by law to have a minimum share capital of £50,000 denominated in sterling. The deferred shares were issued to meet this requirement, which was removed on the implementation of section 542 of the Companies Act 2006 on October 1, 2009. Accordingly, Tomkins plc bought back and cancelled the deferred shares on December 16, 2009 and transferred the nominal amount of the shares to the capital redemption reserve in accordance with the applicable capital maintenance rules.

The deferred shares were not listed on any investment exchange and had extremely limited rights such that they effectively had no value.

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

39. Share capital and reserves continued

 

D. Share premium account

The share premium account records the difference between the nominal value of shares issued and the fair value of the consideration received. The share premium account is not distributable but may be used for certain purposes specified by UK law, including to write off expenses on any issue of shares or debentures and to pay up fully paid bonus shares. The share premium account may be reduced by special resolution of Tomkins Limited’s shareholder and with court approval.

E. Capital redemption reserve

The capital redemption reserve records the cost of shares purchased by Tomkins Limited for cancellation or redeemed in excess of the proceeds of any fresh issue of shares made specifically to fund the purchase or redemption. The capital redemption reserve is not distributable but may be reduced by special resolution of Tomkins Limited’s shareholder and with court approval.

F. Own shares

Own shares represented the cost of ordinary shares in Tomkins plc that were acquired to meet the Group’s expected obligations under employee share schemes. Dividends relating to own shares held were waived with the exception of those that are payable to participants in the relevant schemes.

As at January 2, 2010, the Group held 2,543,194 own shares with a market value of $7.9 million (of which 904,632 shares were held in trust and 1,638,562 shares were held in treasury).

 

40. Analysis of other comprehensive income/(loss)

SUCCESSOR

 

     

Currency

translation

reserve

$ million

    

Available-for-

sale reserve

$ million

    

Accumulated
deficit

$ million

    

Total

shareholders’

equity

$ million

    

Non-

controlling

interests

$ million

    

Total

equity

$ million

  

Q4 2010

             

Foreign currency translation:

             

– Currency translation differences on foreign operations:

             

Subsidiaries

      18.4        –        –        18.4       5.5       23.9  

Associates

      0.3        –        –        0.3       –        0.3  

– Loss on net investment hedges

      (2.5 )      –        –        (2.5 )      –        (2.5 ) 
     16.2        –        –        16.2       5.5       21.7  

Available-for-sale investments:

             

– Gain arising in the period

      –        0.1       –        0.1       0.1       0.2  
     –        0.1       –        0.1       0.1       0.2  

Post-employment benefits:

             

– Net actuarial gain

      –        –        69.7       69.7       0.4       70.1  

– Effect of the asset ceiling

      –        –        (20.2 )      (20.2 )      –        (20.2 ) 
       –        –        49.5       49.5       0.4       49.9  

Other comprehensive income before tax

      16.2       0.1       49.5       65.8       6.0       71.8  

Income tax expense

      –        (0.1 )      (15.7 )      (15.8 )      (0.1 )      (15.9 ) 

Other comprehensive income after tax

      16.2       –        33.8       50.0       5.9       55.9  

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

40. Analysis of other comprehensive income/(loss) continued

 

PREDECESSOR

 

     

Currency

translation

reserve

$ million

     

Available-

for-sale reserve

$ million

    

Accumulated
deficit

$ million

    

Total

shareholders’

equity

$ million

    

Non-

controlling

interests

$ million

    

Total

equity

$ million

  

9M 2010

              

Foreign currency translation:

              

– Currency translation differences on foreign operations:

              

Subsidiaries

      2.0        –        –        2.0       5.3       7.3  

Associates

      0.6        –        –        0.6       –        0.6  

– Gain on net investment hedges

      0.5        –        –        0.5       –        0.5  
     3.1        –        –        3.1       5.3       8.4  

Available-for-sale investments:

              

– Loss arising in the period

      –         (0.1 )      –        (0.1 )      –        (0.1 ) 
     –         (0.1 )      –        (0.1 )      –        (0.1 ) 

Post-employment benefits:

              

– Net actuarial loss

      –         –        (30.8 )      (30.8 )      (0.5 )      (31.3 ) 

– Effect of the asset ceiling

      –         –        0.3       0.3       –        0.3  
       –         –        (30.5 )      (30.5 )      (0.5 )      (31.0 ) 

Other comprehensive (loss)/income before tax

      3.1        (0.1 )      (30.5 )      (27.5 )      4.8       (22.7 ) 

Income tax benefit

      –         –        0.6       0.6       0.3       0.9  

Other comprehensive (loss)/income after tax

      3.1        (0.1 )      (29.9 )      (26.9 )      5.1       (21.8 ) 

 

     

Currency

translation

reserve

$ million

    

Available-for-

sale reserve

$ million

    

Accumulated
deficit

$ million

    

Total

shareholders’

equity

$ million

    

Non-

controlling

interests

$ million

    

Total

equity

$ million

  

Fiscal 2009

             

Foreign currency translation:

             

– Currency translation differences on foreign operations:

             

Subsidiaries

      81.5       –        –        81.5       2.4       83.9  

Associates

      (1.6 )      –        –        (1.6 )      –        (1.6 ) 

– Loss on net investment hedges

      (3.1 )      –        –        (3.1 )      –        (3.1 ) 
     76.8       –        –        76.8       2.4       79.2  

Available-for-sale investments:

             

– Gain arising in the period

      –        0.2       –        0.2       0.2       0.4  
     –        0.2       –        0.2       0.2       0.4  

Post-employment benefits:

             

– Net actuarial loss

      –        –        (142.6 )      (142.6 )      (1.2 )      (143.8 ) 

– Effect of the asset ceiling

      –        –        18.6       18.6       –        18.6  
       –        –        (124.0 )      (124.0 )      (1.2 )      (125.2 ) 

Other comprehensive (loss)/income before tax

      76.8       0.2       (124.0 )      (47.0 )      1.4       (45.6 ) 

Income tax (expense)/benefit

      (0.2 )      (0.1 )      26.1       25.8       0.5       26.3  

Other comprehensive (loss)/income after tax

      76.6       0.1       (97.9 )      (21.2 )      1.9       (19.3 ) 

 

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

40. Analysis of other comprehensive income/(loss) continued

 

Fiscal 2008

                  

Foreign currency translation:

                  

– Currency translation differences on foreign operations:

                  

Subsidiaries

      (211.0 )       –         –         (211.0 )       (0.7 )       (211.7 ) 

Associates

      (3.2 )       –         –         (3.2 )       –         (3.2 ) 

– Gain on net investment hedges

      57.2        –         –         57.2        –         57.2  

– Reclassification to profit or loss of currency translation loss on foreign operations sold

      6.7        –         –         6.7        –         6.7  
     (150.3 )       –         –         (150.3 )       (0.7 )       (151.0 ) 

Available-for-sale investments:

                  

– Loss arising in the period

      –         (0.5 )       –         (0.5 )       (0.5 )       (1.0 ) 

– Reclassification to profit or loss of gain on investments sold

      –         (0.6 )       –         (0.6 )       (0.6 )       (1.2 ) 
     –         (1.1 )       –         (1.1 )       (1.1 )       (2.2 ) 

Post-employment benefits:

                  

– Net actuarial loss

      –         –         (98.3 )       (98.3 )       (0.5 )       (98.8 ) 

– Effect of the asset ceiling

      –         –         12.3        12.3        –         12.3  
       –         –         (86.0 )       (86.0 )       (0.5 )       (86.5 ) 

Other comprehensive loss before tax

      (150.3 )       (1.1 )       (86.0 )       (237.4 )       (2.3 )       (239.7 ) 

Income tax benefit

      0.2        0.3        13.2        13.7        0.6        14.3  

Other comprehensive loss after tax

      (150.1 )       (0.8 )       (72.8 )       (223.7 )       (1.7 )       (225.4 ) 

 

41. Acquisition of businesses

SUCCESSOR

A. Acquisition of Tomkins

On September 24, 2010, Tomkins Acquisitions Limited (formerly Pinafore Acquisitions Limited), a wholly-owned subsidiary of the Company, acquired the entire issued ordinary share capital of Tomkins plc, the parent company of a global engineering and manufacturing group, for consideration of £3.25 per share.

Consideration payable on the acquisition of Tomkins amounted to $4,615.4 million, which was settled as to $4,535.0 million in cash, $45.5 million in loan notes and $34.9 million in options granted over ordinary ‘B’ shares in the Company. Based on the initial estimate of the fair value of the assets acquired and liabilities assumed at the date of acquisition, the Group has recognized provisional goodwill of $1,742.1 million on the acquisition of Tomkins. Management has been unable to finalize its assessment of the fair values at the acquisition date of certain identifiable intangible assets and items of property, plant and equipment, but expects to complete the assessment during the first half of 2011.

Goodwill recognized on the acquisition of Tomkins is principally attributable to expected future opportunities to increase sales and further enhance margins by further developing Tomkins’ product range and service capabilities (with an emphasis on the growing markets for energy-efficient and environmentally-friendly products), extending Tomkins’ global presence by further penetrating markets in the emerging economies, and by pursuing performance improvement initiatives. None of the goodwill is expected to be deductible for tax purposes.

Tomkins accounted for the Group’s entire sales and $270.2 million of its loss for the period ended December 31, 2010. If Tomkins had been acquired on September 1, 2010, when the Company was incorporated, the Group’s sales for the successor period would have been $386.6 million higher, at $1,675.8 million and the Group’s loss for the period would have been $10.0 million lower at $260.2 million.

Acquisition-related costs of $78.2 million were recognized and expensed during Q4 2010.

 

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41. Acquisition of businesses continued

 

B. Financial effect of the acquisition

 

       

Q4 2010

$ million

  

Net assets acquired

     

Identifiable intangible assets

        2,301.9  

Property, plant and equipment

        1,353.3  

Investment in associates

        22.5  

Inventories

        838.2  

Trade and other receivables

        972.7  

– Gross contractual amounts receivable

        986.9  

– Allowance for doubtful debts

        (14.2 ) 

Income tax recoverable

        6.6  

Deferred tax assets

        4.4  

Available-for-sale investments

        1.2  

Cash and cash equivalents

        510.8  
         6,011.6  

Assets held for sale

        32.8  

Total assets

        6,044.4  

Liabilities

     

Bank overdrafts

        (19.7 ) 

Bank and other loans

        (654.6 ) 

Obligations under finance leases

        (3.6 ) 

Trade and other payables

        (813.1 ) 

Post-employment benefit obligations

        (338.3 ) 

Income tax liabilities

        (105.5 ) 

Deferred tax liabilities

        (820.5 ) 

Provisions

        (102.3 ) 
         (2,857.6 ) 

Liabilities directly associated with assets held for sale

        (9.0 ) 

Total liabilities

        (2,866.6 ) 

Net assets acquired

        3,177.8  

Goodwill recognized was as follows:

 

       

Q4 2010

$ million

  

Consideration

        4,615.4  

Non-controlling interests

        304.5  
       4,919.9  

Net assets acquired

        (3,177.8 ) 

Goodwill

        1,742.1  

Non-controlling interests in the acquired business have been measured at the non-controlling interest’s proportionate share of the identifiable assets and liabilities of the acquired business.

The net cash outflow on acquisitions during the period was as follows:

 

       

Q4 2010

$ million

  

Cash consideration paid

        4,535.0  

Net cash and cash equivalents acquired

        (491.1 ) 
         4,043.9  

 

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41. Acquisition of businesses continued

 

PREDECESSOR

9M 2010

Industrial & Automotive

Fluid Power

On April 13, 2010, the Group acquired a 100% interest in TransHose Corporation, a hydraulic hose supplier to the mining industry in Australia, for A$3.0 million in cash plus up to A$2.0 million in cash over three years contingent on the sales and profitability of the acquired business. Based on the initial estimate of the fair value of TransHose’s assets and liabilities at the date of acquisition, the Group recognized provisional goodwill of $2.9 million.

During 9M 2010, the Group completed the initial accounting for the acquisition of Hydrolink in July 2009 and reduced the attributable goodwill by $1.4 million to $15.2 million.

Building Products

Air Distribution

On February 26, 2010, the Group acquired a 100% interest in Koch Filter Corporation (‘Koch’), a leading manufacturer of air filters for the non-residential filtration market in the US, for $35.5 million in cash. Based on the initial estimate of the fair value of Koch’s assets and liabilities at the date of acquisition, the Group recognized provisional goodwill of $21.4 million which represented the synergies expected from the acquisition.

On July 19, 2010, the Group acquired the net assets of ProVent, a designer and manufacturer of custom curb, ventilation and HVAC accessories in the US, for $0.5 million in cash plus up to $0.3 million contingent on ProVent’s sales in the first 14 months after the completion of the acquisition. Based on the initial estimate of the fair value of ProVent’s assets and liabilities at the date of acquisition, the Group recognized provisional goodwill of $0.2 million.

Fiscal 2009

Industrial & Automotive

Fluid Power

On July 7, 2009, the Group acquired a 100% interest in Hydrolink, a fluid engineering services provider to the oil and gas and marine sectors in the Middle East. Based on the initial estimate of the fair value of Hydrolink’s assets and liabilities at the date of acquisition, the Group recognized provisional goodwill of $16.5 million.

During Fiscal 2009, the Group completed the initial accounting for the acquisition of A.E. Hydraulic (Pte) Ltd. in March 2008 and increased the attributable goodwill by $1.6 million to $9.7 million.

Building Products

Air Distribution

On July 7, 2009, the Group acquired the remaining 40% non-controlling interest in Rolastar Pvt Ltd, a duct manufacturer based in India. Goodwill of $4.6 million was recognized on the acquisition of the non-controlling interest. Also during Fiscal 2009, the Group completed the initial accounting for the 60% interest in the business acquired in February 2008 and increased the attributable goodwill by $3.0 million to $3.9 million. Overall, the Group recognized goodwill of $8.5 million on the acquisition of its 100% interest in the business.

During Fiscal 2009, the Group completed the initial accounting for the acquisition of Trion Inc. in June 2008 and increased the attributable goodwill by $1.1 million to $3.5 million.

Fiscal 2008

Industrial & Automotive

Fluid Power

On March 3, 2008, the Group acquired a 100% interest in A.E. Hydraulic (Pte) Ltd., a Singapore-based provider of hydraulic and industrial hose solutions and services for the oil exploration industry in Asia. Goodwill of $8.1 million was recognized on the acquisition which represents the expected benefits to the Group from the acceleration of its expansion into the high-growth oil and gas exploration market made possible by the acquisition.

Fluid Systems

During Fiscal 2008, the Group completed the initial accounting for the acquisition of Swindon Silicon Systems Limited in September 2007 and reduced the attributable goodwill by $3.0 million to $3.0 million.

 

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41. Acquisition of businesses continued

 

Building Products

Air Distribution

On February 22, 2008, the Group acquired a 60% interest in Rolastar Pvt Ltd, a duct manufacturer based in India. Based on the initial estimate of the fair value of Rolastar’s assets and liabilities at the date of acquisition, the Group recognized provisional goodwill of $0.9 million.

On June 20, 2008, the Group acquired a 100% interest in Trion Inc., a manufacturer of commercial, industrial and residential indoor air quality products. Trion is headquartered in Sanford, North Carolina, with manufacturing facilities there and also in Suzhou, China. Based on the initial estimate of the fair value of Trion’s assets and liabilities at the date of acquisition, the Group recognized provisional goodwill of $2.4 million.

Financial effect of acquisitions

 

       PREDECESSOR  
       

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Net assets acquired

         

Identifiable intangible assets

        6.4       5.9       37.4  

Property, plant and equipment

        4.2       8.0       9.2  

Inventories

        5.2       7.4       12.4  

Trade and other receivables

        5.6       7.2       11.5  

Income tax recoverable

        –        –        1.2  

Cash and cash equivalents

        0.3       0.4       0.1  

Bank and other loans

        –        (7.4 )      (0.4 ) 

Obligations under finance leases

        –        (0.4 )      (0.4 ) 

Trade and other payables

        (2.4 )      (10.3 )      (8.9 ) 

Income tax liabilities

        (2.4 )      (0.4 )      (0.9 ) 

Deferred tax liabilities

        –        (6.9 )      –   

Provisions

        –        –        (0.3 ) 

Non-controlling interest

        –        6.6       (8.2 ) 
       16.9       10.1       52.7  

Goodwill on current year acquisitions

        24.5       21.1       11.4  

Adjustments to goodwill on prior year acquisitions

        (1.4 )      5.7       (3.0 ) 

Consideration (including transaction costs)

        40.0       36.9       61.1  

The net cash outflow on acquisitions during the period was as follows:

 

       PREDECESSOR  
       

9M 2010

$ million

    

Fiscal 2009

$ million

    

Fiscal 2008

$ million

  

Consideration paid on current period acquisitions

        39.1       25.5       65.5  

Cash and cash equivalents acquired

        (0.3 )      (0.4 )      (0.1 ) 

Deferred consideration

        2.4       1.4       –   

Adjustment to consideration on prior period acquisitions

        –        –        (0.4 ) 
         41.2       26.5       65.0  

 

42. Disposals of businesses

SUCCESSOR

Q4 2010

During Q4 2010, the Group realized $4.0 million in relation to disposals that were recognized in previous years.

 

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42. Disposals of businesses continued

 

PREDECESSOR

9M 2010

During 9M 2010, the Group paid $4.0 million (including costs) to settle claims by the purchasers concerning the consideration payable on disposals that were recognized in previous years, of which $2.2 million was in relation to the disposal of discontinued operations.

Fiscal 2009

During Fiscal 2009, the Group received additional proceeds of $0.7 million on disposals that were recognized in previous years.

Fiscal 2008

On June 19, 2008, the Group sold Stant Manufacturing, Inc., a manufacturer of automotive closure caps and its subsidiary, Standard-Thomson Corporation, a manufacturer of automotive thermostats. A gain of $43.2 million was recognized on the disposal which was determined as follows:

 

     PREDECESSOR  
     

Fiscal 2008

$ million

  

Proceeds:

   

– Cash

      108.1  

– Loan notes

      11.8  
       119.9  

Net assets disposed of

      (68.7 ) 

Disposal costs

      (3.3 ) 

Curtailment gain on retained pension plan

      2.0  

Currency translation loss transferred from other comprehensive income

      (6.7 ) 

Gain on disposal

      43.2  

The net cash (outflow)/ inflow on disposals was as follows:

 

       PREDECESSOR  
       

9M 2010

$ million

    

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Proceeds received:

          

– Disposals in the period

        0.2       –         108.1  

– Disposals in previous periods

        0.4       0.7        21.1  

Disposal costs paid

        (4.6 )      –         (4.3 ) 

Cash and cash equivalents disposed of

        –        –         (0.3 ) 
         (4.0 )      0.7        124.6  

 

43. Contingencies

The Group is, from time to time, party to legal proceedings and claims, which arise in the ordinary course of business. Management does not anticipate that the outcome of any current proceedings or known claims, either individually or in aggregate, will have a material adverse effect upon the Group’s financial position.

 

44. Operating leases

The Group rents certain office premises and plant, equipment and vehicles under operating lease arrangements. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments. During Q4 2010, the operating lease rental expense was $13.5 million (9M 2010: $37.7 million; Fiscal 2009: $59.5 million; Fiscal 2008: $55.1 million).

 

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44. Operating leases continued

 

As at December 31, 2010, the Group had outstanding commitments under non-cancellable operating leases of $220.1 million (January 2, 2010: $241.0 million), falling due as follows:

 

     SUCCESSOR                    PREDECESSOR  
     

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Payments to be made:

              

– Within one year

      45.1                 46.2   

– In the second to fifth years, inclusive

      108.6                 112.0   

– After more than five years

      66.4                           82.8   
       220.1                           241.0   

 

45. Capital commitments

As at December 31, 2010, the Group had entered into contractual commitments for the purchase of property, plant and equipment amounting to $19.7 million (January 2, 2010: $20.8 million) and for the purchase of non-integral computer software amounting to $0.9 million (January 2, 2010: $0.7 million).

 

46. Related party transactions

Transactions between Group companies, which are related parties, have been eliminated on consolidation and, therefore, are not required to be disclosed in these financial statements. Details of transactions between the Group and other related parties are disclosed below.

A. Post-employment benefit plans

During Q4 2010, the Group paid employer’s contributions amounting to $21.1 million (9M 2010: $54.1 million; Fiscal 2009: $86.2 million; Fiscal 2008: $84.9 million) to pension plans established for the benefit of its employees. As at December 31, 2010, contributions due to the plans amounting to $16.1 million (January 2, 2010: $14.8 million) were included in other payables. In addition, during Q4 2010, the Group paid benefits of $3.6 million (9M 2010: $11.2 million; Fiscal 2009: $15.1 million; Fiscal 2008: $13.0 million) to other post-employment benefit plans.

B. Compensation and interests of key management personnel

Prior to the acquisition of Tomkins, the Group considered its key management personnel to be the Directors of Tomkins Limited together with those persons who, in accordance with the Listing Rules of the UKLA, were regarded as discharging management responsibility. Since the acquisition of Tomkins, the Group considers its key management personnel to be the Directors of the Company and the executive officers of Tomkins.

 

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46. Related party transactions continued

 

B. Compensation and interests of key management personnel (continued)

 

Compensation paid or payable to key management personnel in respect of their services to the Group was as follows:

 

     SUCCESSOR                    PREDECESSOR  
     

Q4 2010

$’000s

                     

9M 2010

$’000s

     

Fiscal 2009

$’000s

     

Fiscal 2008

$’000s

  

Short-term employee benefits:

                    

– Salaries and fees

      1,121                3,230         4,928         6,064   

– Bonus cash

      2,609                4,314         3,397         1,504   

– Benefits-in-kind

      71                149         168         308   

– Social security contributions

      12                27         425         509   

– Termination benefits

      –                           –         755         37   
       3,813                          7,720         9,673         8,422   

Share-based incentives:

                    

– Retention awards

      3,080                –         –         –   

– ABIP

                    

Bonus shares

      –                 557         829         324   

Deferred shares

      –                 1,113         1,659         647   

– Gain on the vesting of PSP awards

      14,979                 –         –         –   

– Gain on the exercise of share options

      1,306                          173         –         –   
       19,365                          1,843         2,488         971   

Pension contributions

      355                          1,039         1,260         2,603   
       23,533                          10,602         13,421         11,996   

Details of the Group’s share-based incentive schemes are presented in note 36.

As a consequence of the acquisition of Tomkins, the share-based element of the ABIP was suspended and bonuses earned in the second, third and fourth quarters of 2010 were settled entirely in cash.

In the above table, the gain on the vesting of PSP awards represents the value of the PSP awards over ordinary shares in Tomkins plc held by key management personnel that vested on the acquisition of Tomkins. In addition, key management personnel chose to cancel PSP awards over ordinary shares in Tomkins plc with a value of $31.7 million in exchange for Replacement Options over ‘B’ ordinary shares in the Company. Any gain on the exercise of the Replacement Options will be recognized as compensation paid to key management personnel in the periods in which they are exercised.

C. Entities controlled by the members of Pinafore Coöperatief U.A.

Onex Partners Manager LP

During Q4 2010, Onex Partners Manager LP, a subsidiary of Onex Corporation, provided certain services to Tomkins Acquisitions Limited (formerly Pinafore Acquisitions Limited), a subsidiary of the Company, in connection with the acquisition of Tomkins Limited including arranging and negotiating the transaction and arranging and negotiating the funding for the transaction. In consideration for those services, Tomkins Acquisitions Limited paid Onex Partners Manager LP a fee of $25.0 million.

On September 27, 2010, Onex Partners Manager LP entered into a management services agreement pursuant to which it provides Tomkins Acquisitions Limited with advisory, consulting and other services in relation to the operations of Tomkins Acquisitions Limited and its subsidiaries including strategic planning, marketing and financial oversight. In consideration of these oversight services, Tomkins Acquisitions Limited has agreed to pay Onex Partners Manager LP (or such other party as is designated by Onex Partners Manager LP) a fee of $1.8 million per annum plus reasonable out-of-pocket expenses. During Q4 2010, Tomkins Acquisitions Limited accrued and paid $450,000 in respect of these oversight services and out-of-pocket expenses.

It was further acknowledged and agreed that, from time to time, Onex Partners Manager LP may be requested to provide consulting and other services to Tomkins Acquisitions Limited, including in relation to acquisitions and disposals or the sale of debt or equity interests in or any similar financing transactions. During Q4 2010, there were no amounts payable in respect of such additional services.

 

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46. Related party transactions continued

 

C. Entities controlled by the members of Pinafore Coöperatief U.A. (continued)

CPPIB Equity Investments Inc.

During Q4 2010, CPPIB Equity Investments Inc., a subsidiary of CPPIB, provided certain services to Tomkins Acquisitions Limited, a subsidiary of the Company, in connection with the acquisition of Tomkins Limited including arranging and negotiating the transaction and arranging and negotiating the funding for the transaction. In consideration for those services, Tomkins Acquisitions Limited paid CPPIB Equity Investments Inc. a fee of $25.0 million.

On September 27, 2010, CPPIB Equity Investments Inc. entered into a management services agreement pursuant to which it provides Tomkins Acquisitions Limited with advisory, consulting and other services in relation to the operations of Tomkins Acquisitions Limited and its subsidiaries including strategic planning, marketing and financial oversight. In consideration of these oversight services, Tomkins Acquisitions Limited has agreed to pay CPPIB Equity Investments Inc. (or such other party as is designated by CPPIB Equity Investments Inc.) a fee of $1.2 million per annum plus reasonable out-of-pocket expenses. During Q4 2010, Tomkins Acquisitions Limited accrued but had not paid $172,000 in respect of these oversight services and out-of-pocket expenses.

It was further acknowledged and agreed that, from time to time, CPPIB Equity Investments Inc. may be requested to provide consulting and other services to Tomkins Acquisitions Limited, including in relation to acquisitions and disposals or the sale of debt or equity interests in or any similar financing transactions. During Q4 2010, there were no amounts payable in respect of such additional services.

D. Associates

Sales to and purchases from associates were as follows:

 

     SUCCESSOR                 

PREDECESSOR

  
     

Q4 2010

$ million

                   

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Sales

      1.6              4.2        4.3        1.0  

Purchases

      (4.2 )                       (12.7 )       (15.2 )       (20.0 ) 

Amounts outstanding in respect of these transactions were as follows:

 

       SUCCESSOR                    PREDECESSOR  
       

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Receivables

        0.1                0.8  

Payables

        (0.8 )                         (1.2 ) 

E. Entities controlled by minority shareholders

Sales to and purchases from entities controlled by minority shareholders were as follows:

 

     SUCCESSOR                 

PREDECESSOR

  
     

Q4 2010

$ million

                   

9M 2010

$ million

     

Fiscal 2009

$ million

     

Fiscal 2008

$ million

  

Sales

      16.5              39.0        26.3        45.2  

Purchases

      (13.8 )                       (35.5 )       (39.1 )       (58.7 ) 

Amounts outstanding in respect of these transactions were as follows:

 

       SUCCESSOR                    PREDECESSOR  
       

As at

December 31,

2010

$ million

                     

As at

January 2,

2010

$ million

  

Receivables

        3.7                2.7  

Payables

        (2.6 )                         (2.7 ) 

 

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46. Related party transactions continued

 

F. Other related parties

Yantai Winhere Auto Part Manufacturing Co Ltd (‘Winhere’)

Dexon Investments Limited (‘Dexon’) is the minority shareholder in the Group’s 60% owned subsidiary, Winhere LLC. During Fiscal 2008, Gates Winhere Automotive Pump Products (Yantai) Co Ltd, a wholly-owned subsidiary of Winhere LLC, purchased land and buildings for $1.8 million from Winhere, a fellow subsidiary of Dexon.

Schrader Duncan Limited (‘Schrader Duncan’)

Schrader Duncan is an associate in which the Group holds a 50% interest. During Fiscal 2009, Tomkins Limited, a subsidiary of the Company, and Cosmopolitan Investments (a fellow shareholder in Schrader Duncan) each issued a guarantee in favor of the State Bank of India (‘the Bank’) in relation to any principal sum up to a maximum of 480 million Indian rupees ($10.5 million), together with interest and any other costs and charges due in respect of credit facilities provided to Schrader Duncan. Tomkins Limited and Cosmopolitan Investments are jointly and severally liable for the guaranteed amounts.

47. Condensed consolidating financial information

The Senior Secured Credit Facilities and the Second Lien Notes were issued by Tomkins, Inc. and Tomkins, LLC (‘the Issuers’), which are both wholly-owned subsidiaries of the Company, and are jointly and severally, irrevocably and fully and unconditionally guaranteed by the Company and certain other of the Company’s wholly-owned subsidiaries (‘the Guarantors’).

Supplemental condensed consolidating financial information is presented below comprising the Group’s income statements and cash flow statements for Q4 2010, 9M 2010, Fiscal 2009 and Fiscal 2008 and its balance sheets as at December 31, 2010 and January 2, 2010, showing the amounts attributable to the Company, the Issuers and those of its other subsidiaries that were Guarantors as at December 31, 2010 separately from the amounts attributable to those of its subsidiaries that were not Guarantors. The condensed consolidating financial information is prepared in accordance with the Group’s accounting policies, except that investments in subsidiaries are accounted for by their parent company under the equity method of accounting. Under the equity method of accounting, the parent company’s income statement includes on one line its share of the profit or loss of its subsidiary undertakings and the parent company’s balance sheet includes on one line its share of the net assets of its subsidiary undertakings.

A. Consolidated income statement

 

Q4 2010  

Company

$ million

    

Issuers

$ million

    

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Continuing operations

            

Sales

     –        –        816.7       658.3       (185.8 )      1,289.2  

Cost of sales

     –        –        (667.8 )      (542.2 )      171.9       (1,038.1 ) 

Gross profit

     –        –        148.9       116.1       (13.9 )      251.1  

Distribution costs

     –        –        (98.6 )      (46.0 )      –        (144.6 ) 

Administrative expenses

     (0.1 )      (0.1 )      (166.1 )      (64.5 )      –        (230.8 ) 

Transaction costs

     (0.1 )      –        (77.8 )      (0.3 )      –        (78.2 ) 

Restructuring costs

     –        –        (0.9 )      (1.1 )      –        (2.0 ) 

Share of (loss)/profit of associates

     –        –        (0.1 )      0.8       –        0.7  

Operating (loss)/profit

     (0.2 )      (0.1 )      (194.6 )      5.0       (13.9 )      (203.8 ) 
           

Interest expense

     –        (68.2 )      (99.3 )      (7.9 )      84.5       (90.9 ) 

Investment income

     –        71.4       26.0       5.8       (84.5 )      18.7  

Other finance income/(expense)

     –        22.9       (45.4 )      (4.6 )      –        (27.1 ) 

Net finance income/(costs)

     –        26.1       (118.7 )      (6.7 )      –        (99.3 ) 

Share of (losses)/profits of subsidiaries under the equity method

     (270.9 )      –        8.7       (1.9 )      264.1       –   

(Loss)/profit before tax

     (271.1 )      26.0       (304.6 )      (3.6 )      250.2       (303.1 ) 

Income tax (expense)/benefit

     –        (8.0 )      33.7       3.2       4.0       32.9  

(Loss)/profit for the period

     (271.1 )      18.0       (270.9 )      (0.4 )      254.2       (270.2 ) 

Non-controlling interests

     –        –        –        (0.9 )      –        (0.9 ) 

(Loss)/profit for the period attributable to equity shareholders

     (271.1 )      18.0       (270.9 )      (1.3 )      254.2       (271.1 ) 

 

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

B. Consolidated income statement

 

9M 2010   

Company

$ million

     

Issuers

$ million

     

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Continuing operations

               

Sales

      –         –         2,334.0       1,653.2       (422.5 )      3,564.7  

Cost of sales

      –         –         (1,643.4 )      (1,214.5 )      420.2       (2,437.7 ) 

Gross profit

      –         –         690.6       438.7       (2.3 )      1,127.0  

Distribution costs

      –         –         (266.1 )      (116.3 )      –        (382.4 ) 

Administrative expenses

      –         –         (250.9 )      (107.3 )      –        (358.2 ) 

Transaction costs

      –         –         (41.3 )      (0.2 )      –        (41.5 ) 

Restructuring costs

      –         –         (8.1 )      (1.9 )      –        (10.0 ) 

Net gain on disposals and on the exit of businesses

      –         –         5.5       0.8       –        6.3  

Share of (loss)/profit of associates

      –         –         (1.5 )      0.2       –        (1.3 ) 

Operating profit

      –         –         128.2       214.0       (2.3 )      339.9  
              

Interest expense

      –         –         (67.7 )      (25.5 )      21.4       (71.8 ) 

Investment income

      –         –         53.7       15.9       (21.4 )      48.2  

Other finance expense

      –         –         (2.7 )      –        –        (2.7 ) 

Net finance costs

      –         –         (16.7 )      (9.6 )      –        (26.3 ) 

Share of profits of subsidiaries under the equity method

      –         –         119.0       1.9       (120.9 )      –   

Profit before tax

      –         –         230.5       206.3       (123.2 )      313.6  

Income tax expense

      –         –         (5.9 )      (57.3 )      0.4       (62.8 ) 

Profit for the period from continuing operations

      –         –         224.6       149.0       (122.8 )      250.8  

Discontinued operations

               

Loss for the period from discontinued operations

      –         –         (7.2 )      –        –        (7.2 ) 

Profit for the period

      –         –         217.4       149.0       (122.8 )      243.6  

Non-controlling interests

      –         –         –        (26.2 )      –        (26.2 ) 

Profit for the period attributable to equity shareholders

      –         –         217.4       122.8       (122.8 )      217.4  

 

F-89

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

C. Consolidated income statement

 

Fiscal 2009   

Company

$ million

     

Issuers

$ million

     

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total

Group

$ million

  

Continuing operations

               

Sales

      –         –         2,773.4       1,884.4       (477.7 )      4,180.1  

Cost of sales

      –         –         (2,032.2 )      (1,441.8 )      478.1       (2,995.9 ) 

Gross profit

      –         –         741.2       442.6       0.4       1,184.2  

Distribution costs

      –         –         (345.1 )      (119.7 )      –        (464.8 ) 

Administrative expenses

      –         –         (301.6 )      (178.8 )      –        (480.4 ) 

Impairments

      –         –         (43.8 )      (29.2 )      –        (73.0 ) 

Restructuring costs

      –         –         (35.1 )      (109.0 )      –        (144.1 ) 

Net gain on disposals and on the exit of businesses

      –         –         0.2       –        –        0.2  

Gain on amendment of post-employment benefits

      –         –         56.9       6.1       –        63.0  

Share of (loss)/profit of associates

      –         –         (1.0 )      0.6       –        (0.4 ) 

Operating profit

      –         –         71.7       12.6       0.4       84.7  
              

Interest expense

      –         –         (112.3 )      (31.3 )      30.4       (113.2 ) 

Investment income

      –         –         71.9       25.7       (30.4 )      67.2  

Other finance (expense)/income

      –         –         (1.2 )      0.9       –        (0.3 ) 

Net finance costs

      –         –         (41.6 )      (4.7 )      –        (46.3 ) 

Share of losses of subsidiaries under the equity method

      –         –         (24.1 )      –        24.1       –   

Profit before tax

      –         –         6.0       7.9       24.5       38.4  

Income tax expense

      –         –         (17.7 )      (10.4 )      (0.4 )      (28.5 ) 

(Loss)/profit for the period from continuing operations

      –         –         (11.7 )      (2.5 )      24.1       9.9  

Discontinued operations

               

Loss for the period from discontinued operations

      –         –         (3.9 )      –        –        (3.9 ) 

(Loss)/profit for the period

      –         –         (15.6 )      (2.5 )      24.1       6.0  

Non-controlling interests

      –         –         –        (21.6 )      –        (21.6 ) 

(Loss)/profit for the period attributable to equity shareholders

      –         –         (15.6 )      (24.1 )      24.1       (15.6 ) 

 

F-90

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

D. Consolidated income statement

 

Fiscal 2008   

Company

$ million

     

Issuers

$ million

     

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Continuing operations

               

Sales

      –         –         3,550.7       2,554.1       (588.9 )      5,515.9  

Cost of sales

      –         –         (2,636.8 )      (1975.4 )      588.5       (4,023.7 ) 

Gross profit

      –         –         913.9       578.7       (0.4 )      1,492.2  

Distribution costs

      –         –         (411.5 )      (173.0 )      –        (584.5 ) 

Administrative expenses

      –         –         (320.0 )      (193.3 )      –        (513.3 ) 

Impairments

      –         –         (72.5 )      (269.9 )      –        (342.4 ) 

Restructuring costs

      –         –         (24.3 )      (1.7 )      –        (26.0 ) 

Net gain/(loss) on disposals and on the exit of businesses

      –         –         43.4       (0.4 )      –        43.0  

Share of profit/(loss) of associates

      –         –         0.1       (2.2 )      –        (2.1 ) 

Operating profit/(loss)

      –         –         129.1       (61.8 )      (0.4 )      66.9  
              

Interest expense

      –         –         (210.9 )      (62.4 )      135.5       (137.8 ) 

Investment income

      –         –         108.4       114.9       (135.5 )      87.8  

Other finance expense

      –         –         (24.3 )      (0.7 )      –        (25.0 ) 

Net finance (costs)/income

      –         –         (126.8 )      51.8       –        (75.0 ) 

Share of losses of subsidiaries under the equity method

      –         –         (117.3 )      –        117.3       –   

(Loss)/profit before tax

      –         –         (115.0 )      (10.0 )      116.9       (8.1 ) 

Income tax benefit/(expense)

      –         –         50.4       (89.2 )      0.4       (38.4 ) 

(Loss)/profit for the period

      –         –         (64.6 )      (99.2 )      117.3       (46.5 ) 

Non-controlling interests

      –         –         –        (18.1 )      –        (18.1 ) 

(Loss)/profit for the period attributable to equity shareholders

      –         –         (64.6 )      (117.3 )      117.3       (64.6 ) 

 

F-91

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

E. Consolidated cash flow statement

 

Q4 2010   

Company

$ million

    

Issuers

$ million

    

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Operating activities

             

Cash generated from operations

      –        –        (70.2 )      136.5       –        66.3  

Income taxes paid

      –        (0.8 )      (6.2 )      (15.3 )      –        (22.3 ) 

Income taxes received

      –        –        1.4       –        –        1.4  

Net cash (outflow)/inflow from operating activities

      –        (0.8 )      (75.0 )      121.2       –        45.4  

Investing activities

             

Purchase of property, plant and equipment

      –        –        (29.6 )      (33.8 )      3.2        (60.2 ) 

Capitalization of development costs

      –        –        (2.3 )      –        –        (2.3 ) 

Disposal of property, plant and equipment

      –        –        1.3       4.6       (3.2 )      2.7  

Investments in associates

      –        –        (0.5 )      –        –        (0.5 ) 

Purchase of interests in subsidiaries, net of cash acquired

      (2,124.7 )      –        (4,391.7 )      159.5       2,313.0       (4,043.9 ) 

Sale of businesses and subsidiaries, net of cash disposed

      –        –        4.3       38.1       (38.4 )      4.0  

Interest received

      –        71.4       10.5       4.0       (84.5 )      1.4  

Dividends received from subsidiaries

      –        –        (0.2 )      –        0.2       –   

Net cash (outflow)/inflow from investing activities

      (2,124.7 )      71.4       (4,408.2 )      172.4       2,190.3       (4,098.8 ) 

Financing activities

             

Issue of ordinary shares

      2,142.3       149.8       2,124.7       0.1       (2,274.6 )      2,142.3  

Draw-down of bank and other loans

      –        3,150.0       –        –        –        3,150.0  

Repayment of bank and other loans

      –        (26.8 )      (433.3 )      (0.3 )      –        (460.4 ) 

Loans (to)/from Group companies

      (17.6 )      (3,124.3 )      3,206.4       (64.5 )      –        –   

Payments on foreign currency derivatives

      –        –        (2.2 )      –        –        (2.2 ) 

Premium on redemption

      –        –        (4.6 )      –        –        (4.6 ) 

Capital element of finance lease rental payments

      –        –        –        (0.2 )      –        (0.2 ) 

Movement in collateralized cash

      –        –        (44.9 )      –        –        (44.9 ) 

Interest paid

      –        (33.8 )      (101.3 )      (7.5 )      84.5       (58.1 ) 

Financing costs paid

      –        (182.4 )      –        –        –        (182.4 ) 

Equity dividend paid

      –        –        –        0.2       (0.2 )      –   

Investment by a minority shareholder in a subsidiary

      –        –        11.7       –        –        11.7  

Net cash inflow/(outflow) from financing activities

      2,124.7       (67.5 )      4,756.5       (72.2 )      (2,190.3 )      4,551.2  

Increase in net cash and cash equivalents

      –        3.1       273.3       221.4       –        497.8  

Net cash and cash equivalents at the beginning of the period

      –        –        –        –        –        –   

Foreign currency translation

      –        –        (47.2 )      1.6       –        (45.6 ) 

Net cash and cash equivalents at the end of the period

      –        3.1       226.1       223.0       –        452.2  

 

F-92

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

F. Consolidated cash flow statement

 

9M 2010

   

Company

$ million

     

Issuers

$ million

     

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Operating activities

               

Cash generated from operations

      –         –         104.3       110.9       –        215.2  

Income taxes paid

      –         –         (40.1 )      (26.1 )      –        (66.2 ) 

Income taxes received

      –         –         43.5       2.2       –        45.7  

Net cash inflow from operating activities

      –         –         107.7       87.0       –        194.7  

Investing activities

               

Purchase of property, plant and equipment

      –         –         (45.0 )      (45.4 )      0.4       (90.0 ) 

Purchase of computer software

      –         –         (4.3 )      (1.4 )      –        (5.7 ) 

Capitalization of development costs

      –         –         (0.5 )      –        –        (0.5 ) 

Disposal of property, plant and equipment

      –         –         17.7       7.3       (0.4 )      24.6  

Purchase of interests in subsidiaries, net of cash acquired

      –         –         (46.8 )      (36.1 )      41.7       (41.2 ) 

Sale of businesses and subsidiaries, net of cash disposed

      –         –         (4.1 )      0.1       –        (4.0 ) 

Interest received

      –         –         24.3       10.2       (21.2 )      13.3  

Dividends received from associates

      –         –         0.3       0.2       –        0.5  

Dividends received from subsidiaries

      –         –         74.3       –        (74.3 )      –   

Net cash inflow/(outflow) from investing activities

      –         –         15.9       (65.1 )      (53.8 )      (103.0 ) 

Financing activities

               

Issue of ordinary shares

      –         –         41.0       6.2       (41.7 )      5.5   

Repayment of bank and other loans

      –         –         (0.8 )      –        –        (0.8 ) 

Loans (to)/from Group companies

      –         –         (24.7 )      24.7       –        –   

Payments on foreign currency derivatives

      –         –         (20.3 )      –        –        (20.3 ) 

Settlement of interest rate swaps

      –         –         64.7       –        –        64.7  

Capital element of finance lease rental payments

      –         –         (0.3 )      (0.4 )      –        (0.7 ) 

Interest element of finance lease rental payments

      –         –         (0.2 )      –        –        (0.2 ) 

Purchase of own shares

      –         –         (6.2 )      –        –        (6.2 ) 

Interest paid

      –         –         (20.6 )      (15.8 )      21.2       (15.2 ) 

Equity dividend paid

      –         –         (56.9 )      (74.3 )      74.3       (56.9 ) 

Dividend paid to a minority shareholder in a subsidiary

      –         –         (1.1 )      (10.9 )      –        (12.0 ) 

Net cash outflow from financing activities

      –         –         (25.4 )      (70.5 )      53.8       (42.1 ) 

Increase/(decrease) in net cash and cash equivalents

      –         –         98.2       (48.6 )      –        49.6  

Net cash and cash equivalents at the beginning of the period

      –         –         236.6       203.6       –        440.2  

Foreign currency translation

      –         –         (3.1 )      4.4       –        1.3  

Net cash and cash equivalents at the end of the period

      –         –         331.7       159.4       –        491.1  

 

F-93

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

G. Consolidated cash flow statement

 

Fiscal 2009   

Company

$ million

     

Issuers

$ million

     

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Operating activities

               

Cash generated from operations

      –         –         291.0       241.1       –        532.1  

Income taxes paid

      –         –         (26.0 )      (24.3 )      –        (50.3 ) 

Income taxes received

      –         –         31.2       –        –        31.2  

Net cash inflow from operating activities

      –         –         296.2       216.8       –        513.0  

Investing activities

               

Purchase of property, plant and equipment

      –         –         (52.0 )      (64.8 )      1.6       (115.2 ) 

Purchase of computer software

      –         –         (4.9 )      (2.9 )      –        (7.8 ) 

Capitalization of development costs

      –         –         (0.6 )      –        –        (0.6 ) 

Disposal of property, plant and equipment

      –         –         3.7       10.8       (1.6 )      12.9  

Investments in associates

      –         –         (2.7 )      –        –        (2.7 ) 

Purchase of interests in subsidiaries, net of cash acquired

      –         –         (86.7 )      0.7       59.5       (26.5 ) 

Sale of businesses and subsidiaries, net of cash disposed

      –         –         41.1       3.4       (43.8 )      0.7  

Interest received

      –         –         18.8       15.4       (30.6 )      3.6  

Dividends received from associates

      –         –         0.3       –        –        0.3  

Dividends received from subsidiaries

      –         –         157.5       –        (157.5 )      –   

Net cash inflow/(outflow) from investing activities

      –         –         74.5       (37.4 )      (172.4 )      (135.3 ) 

Financing activities

               

Issue of ordinary shares

      –         –         0.1       15.7       (15.7 )      0.1  

Draw-down of bank and other loans

      –         –         1.8       1.0       –        2.8  

Repayment of bank and other loans

      –         –         (142.8 )      (21.6 )      –        (164.4 ) 

Loans (to)/from Group companies

      –         –         (31.3 )      31.3       –        –   

Receipts on foreign currency derivatives

      –         –         39.6       –        –        39.6  

Capital element of finance lease rental payments

      –         –         (0.4 )      (2.4 )      –        (2.8 ) 

Interest element of finance lease rental payments

      –         –         (0.2 )      (0.2 )      –        (0.4 ) 

Movement in collateralized cash

      –         –         –        2.1       –        2.1  

Purchase of own shares

      –         –         (1.4 )      –        –        (1.4 ) 

Interest paid

      –         –         (48.5 )      (19.6 )      30.6       (37.5 ) 

Financing costs paid

      –         –         (6.3 )      –        –        (6.3 ) 

Equity dividend paid

      –         –         (48.3 )      (157.5 )      157.5       (48.3 ) 

Investment by a minority shareholder in a subsidiary

      –         –         –        4.7       –        4.7  

Dividend paid to a minority shareholder in a subsidiary

      –         –         –        (8.7 )      –        (8.7 ) 

Net cash outflow from financing activities

      –         –         (237.7 )      (155.2 )      172.4       (220.5 ) 

Increase in net cash and cash equivalents

      –         –         133.0       24.2       –        157.2  

Net cash and cash equivalents at the beginning of the period

      –         –         108.4       169.8       –        278.2  

Foreign currency translation

      –         –         (4.8 )      9.6       –        4.8  

Net cash and cash equivalents at the end of the period

      –         –         236.6       203.6       –        440.2  

 

F-94

Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

H. Consolidated cash flow statement

 

Fiscal 2008   

Company

$ million

     

Issuers

$ million

     

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Operating activities

               

Cash generated from operations

      –         –         301.2       327.5       –        628.7  

Income taxes paid

      –         –         (47.8 )      (68.5 )      –        (116.3 ) 

Income taxes received

      –         –         31.8       –        –        31.8  

Net cash inflow from operating activities

      –         –         285.2       259.0       –        544.2  

Investing activities

               

Purchase of property, plant and equipment

      –         –         (76.4 )      (109.8 )      3.0       (183.2 ) 

Purchase of computer software

      –         –         (9.1 )      (1.5 )      –        (10.6 ) 

Capitalization of development costs

      –         –         (0.6 )      –        –        (0.6 ) 

Disposal of property, plant and equipment

      –         –         5.1       5.8       (3.0 )      7.9  

Purchase of available-for-sale investments

      –         –         –        (0.1 )      –        (0.1 ) 

Sale of available-for-sale investments

      –         –         –        1.6       –        1.6  

Investments in associates

      –         –         (10.4 )      –        –        (10.4 ) 

Purchase of interests in subsidiaries, net of cash acquired

      –         –         (1,289.1 )      (0.8 )      1,224.9       (65.0 ) 

Sale of businesses and subsidiaries, net of cash disposed

      –         –         2,269.2       670.1       (2,814.7 )      124.6  

Interest received

      –         –         45.2       105.4       (139.4 )      11.2  

Dividends received from associates

      –         –         0.6       –        –        0.6  

Dividends received from subsidiaries

      –         –         230.4       –        (230.4 )      –   

Net cash inflow/(outflow) from investing activities

      –         –         1,164.9       670.7       (1,959.6 )      (124.0 ) 

Financing activities

               

Issue of ordinary shares

      –         –         0.2       –        –        0.2  

Redemption of capital

      –         –         (0.2 )      (1,589.6 )      1,589.8       –   

Draw-down of bank and other loans

      –         –         109.2       5.4       –        114.6  

Repayment of bank and other loans

      –         –         (4.4 )      (11.2 )      –        (15.6 ) 

Loans (to)/from Group companies

      –         –         (987.5 )      987.5       –        –   

Payments on foreign currency derivatives

      –         –         (178.6 )      –        –        (178.6 ) 

Capital element of finance lease rental payments

      –         –         (1.8 )      (1.0 )      –        (2.8 ) 

Interest element of finance lease rental payments

      –         –         (0.3 )      (0.2 )      –        (0.5 ) 

Movement in collateralized cash

      –         –         –        0.7       –        0.7  

Purchase of own shares

      –         –         (4.7 )      –        –        (4.7 ) 

Interest paid

      –         –         (143.7 )      (50.7 )      139.4       (55.0 ) 

Equity dividend paid

      –         –         (246.2 )      (230.4 )      230.4       (246.2 ) 

Investment by a minority shareholder in a subsidiary

      –         –         0.4       –        –        0.4  

Dividend paid to a minority shareholder in a subsidiary

      –         –         –        (13.5 )      –        (13.5 ) 

Net cash outflow from financing activities

      –         –         (1,457.6 )      (903.0 )      1,959.6       (401.0 ) 

(Decrease)/increase in net cash and cash equivalents

      –         –         (7.5 )      26.7       –        19.2  

Net cash and cash equivalents at the beginning of the period

      –         –         108.4       171.8       –        280.2  

Foreign currency translation

      –         –         7.5       (28.7 )      –        (21.2 ) 

Net cash and cash equivalents at the end of the period

      –         –         108.4       169.8       –        278.2  

 

F-95

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Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

I. Consolidated balance sheet

 

As at December 31, 2010  

Company

$ million

    

Issuers

$ million

    

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor
subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Non-current assets

            

Goodwill

     –        –        809.2        936.2       –        1,745.4  

Other intangible assets

     –        –        1,487.7        780.8       –        2,268.5  

Property, plant and equipment

     –        –        669.9        689.2       –        1,359.1  

Investments in subsidiaries under the equity method

     2,010.8        –        3,002.7        –        (5,013.5 )      –   

Investments in associates

     –        –        20.7        2.9       –        23.6  

Trade and other receivables

     –        10.1        12.5        3.6       –        26.2  

Deferred tax assets

     –        –        –        31.9       (22.3 )      9.6  

Post-employment benefit surpluses

     –        –        –        3.6       –        3.6  
      2,010.8        10.1        6,002.7        2,448.2       (5,035.8 )      5,436.0  

Current assets

            

Inventories

     –        –        435.7        271.6       (13.8 )      693.5  

Trade and other receivables

     17.5        3,223.6        1,069.0        1,424.5       (4,820.1 )      914.5  

Income tax recoverable

     –        –        8.3        2.7       –        11.0  

Available-for-sale investments

     –        –        –        1.4       –        1.4  

Cash and cash equivalents

     –        3.1        228.5        227.7       –        459.3  
      17.5        3,226.7        1,741.5        1,927.9       (4,833.9 )      2,079.7  

Assets held for sale

     –        –        29.7        6.9       –        36.6  

Total assets

     2,028.3        3,236.8        7,773.9        4,383.0       (9,869.7 )      7,552.3  

Current liabilities

            

Bank overdrafts

     –        –        (2.4 )      (4.7 )      –        (7.1 ) 

Bank and other loans

     –        (37.9 )      (217.8 )      –        –        (255.7 ) 

Obligations under finance leases

     –        –        (0.2 )      (0.3 )      –        (0.5 ) 

Trade and other payables

     –        (44.0 )      (436.5 )      (422.3 )      198.4       (704.4 ) 

Income tax liabilities

     –        –        (68.0 )      (38.8 )      –        (106.8 ) 

Provisions

     –        –        (25.5 )      (40.1 )      –        (65.6 ) 
      –        (81.9 )      (750.4 )      (506.2 )      198.4       (1,140.1 ) 

Non-current liabilities

            

Bank and other loans

     –        (2,872.3 )      (26.6 )      –        –        (2,898.9 ) 

Obligations under finance leases

     –        –        (2.8 )      –        –        (2.8 ) 

Trade and other payables

     –        (107.5 )      (4,169.3 )      (410.4 )      4,621.8        (65.4 ) 

Post-employment benefit obligations

     –        –        (204.6 )      (74.6 )      –        (279.2 ) 

Deferred tax liabilities

     –        (7.2 )      (578.5 )      (232.9 )      25.3       (793.3 ) 

Income tax liabilities

     –        –        –        –        –        –   

Provisions

     –        –        (22.8 )      (1.9 )      –        (24.7 ) 
      –        (2,987.0 )      (5,004.6 )      (719.8 )      4,647.1        (4,064.3 ) 

Liabilities directly associated with assets held for sale

     –        –        (8.1 )      –        –        (8.1 ) 

Total liabilities

     –        (3,068.9 )      (5,763.1 )      (1,226.0 )      4,845.5       (5,212.5 ) 

Net assets

     2,028.3        167.9       2,010.8       3,157.0       (5,024.2 )      2,339.8  

Capital and reserves

            

Shareholders’ equity

     2,028.3        167.9       2,010.8        2,845.5       (5,024.2 )      2,028.3  

Non-controlling interests

     –        –        –        311.5       –        311.5  

Total equity

     2,028.3        167.9        2,010.8        3,157.0       (5,024.2 )      2,339.8  

 

F-96

Table of Contents

Pinafore Holdings B.V.

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

47. Condensed consolidating financial information continued

 

J. Consolidated balance sheet

 

As at January 2, 2010   

Company

$ million

     

Issuers

$ million

     

Other
guarantor
subsidiaries

$ million

    

Non-
guarantor
subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Non-current assets

               

Goodwill

      –         –         398.6       37.4       –        436.0  

Other intangible assets

      –         –         49.4       28.6       –        78.0  

Property, plant and equipment

      –         –         542.1       580.7       –        1,122.8  

Investments in subsidiaries under the equity method

      –         –         1,353.0       –        (1,353.0 )      –   

Investments in associates

      –         –         18.7       1.9       –        20.6  

Trade and other receivables

      –         –         78.6       2.5       –        81.1  

Deferred tax assets

      –         –         52.8       32.9       (2.8 )      82.9  

Post-employment benefit surpluses

      –         –         1.3       –        –        1.3  
       –         –         2,494.5       684.0       (1,355.8 )      1,822.7  

Current assets

               

Inventories

      –         –         390.6       211.8       (11.6 )      590.8  

Trade and other receivables

      –         –         833.7       1,305.3       (1,386.0 )      753.0  

Income tax recoverable

      –         –         33.4       15.6       –        49.0  

Available-for-sale investments

      –         –         –        1.2       –        1.2  

Cash and cash equivalents

      –         –         238.4       206.6       –        445.0  
       –         –         1,496.1       1,740.5       (1,397.6 )      1,839.0  

Assets held for sale

      –         –         10.3       1.6       –        11.9  

Total assets

      –         –         4,000.9       2,426.1       (2,753.4 )      3,673.6  

Current liabilities

               

Bank overdrafts

      –         –         (1.8 )      (3.0 )      –        (4.8 ) 

Bank and other loans

      –         –         (10.9 )      (0.3 )      –        (11.2 ) 

Obligations under finance leases

      –         –         (0.3 )      (0.7 )      –        (1.0 ) 

Trade and other payables

      –         –         (417.5 )      (365.3 )      105.2       (677.6 ) 

Income tax liabilities

      –         –         (2.3 )      (12.9 )      –        (15.2 ) 

Provisions

      –         –         (29.5 )      (70.8 )      –        (100.3 ) 
       –         –         (462.3 )      (453.0 )      105.2       (810.1 ) 

Non-current liabilities

               

Bank and other loans

      –         –         (687.3 )      –        –        (687.3 ) 

Obligations under finance leases

      –         –         (3.3 )      (0.3 )      –        (3.6 ) 

Trade and other payables

      –         –         (940.3 )      (367.6 )      1,280.8       (27.1 ) 

Post-employment benefit obligations

      –         –         (266.4 )      (77.1 )      –        (343.5 ) 

Deferred tax liabilities

      –         –         (25.8 )      (4.9 )      5.4       (25.3 ) 

Income tax liabilities

      –         –         (62.8 )      (16.7 )      –        (79.5 ) 

Provisions

      –         –         (16.1 )      (3.1 )      –        (19.2 ) 
       –         –         (2,002.0 )      (469.7 )      1,286.2       (1,185.5 ) 

Total liabilities

      –         –         (2,464.3 )      (922.7 )      1,391.4       (1,995.6 ) 

Net assets

      –         –         1,536.6       1,503.4       (1,362.0 )      1,678.0  

Capital and reserves

               

Shareholders’ equity

      –         –         1,536.6       1,362.0       (1,362.0 )      1,536.6  

Non-controlling interests

      –         –         –        141.4       –        141.4  

Total equity

      –         –         1,536.6       1,503.4       (1,362.0 )      1,678.0  

 

F-97

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PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED INCOME STATEMENT

(Unaudited)

 

      Note     

SUCCESSOR
Q1 2011

$ million

    

PREDECESSOR
Q1 2010

$ million

  

Continuing operations

          

Sales

      2         1,342.9       1,165.9  

Cost of sales

               (923.8 )      (801.9 ) 

Gross profit

         419.1       364.0  

Distribution costs

         (140.6 )      (125.7 ) 

Administrative expenses

         (184.3 )      (112.9 ) 

Transaction costs

         (0.4 )      –   

Restructuring costs

      3         (5.4 )      (1.9 ) 

Net gain on disposals and on the exit of businesses

      3         0.2       1.4  

Share of profit of associates

               0.3       0.1  

Operating profit

               88.9       125.0  
         

Interest expense

      4         (91.1 )      (24.1 ) 

Investment income

      5         18.2       16.2  

Other finance income/(expense)

      6         11.0       (2.4 ) 

Net finance costs

               (61.9 )      (10.3 ) 

Profit before tax

         27.0       114.7  

Income tax expense

               (19.3 )      (29.2 ) 

Profit for the period from continuing operations

         7.7       85.5  
 

Discontinued operations

          

Loss for the period from discontinued operations

               –        (0.8 ) 

Profit for the period

         7.7       84.7  

Non-controlling interests

               (6.9 )      (8.7 ) 

Profit for the period attributable to equity shareholders

               0.8       76.0  

 

F-98

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PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Unaudited)

 

     

SUCCESSOR
Q1 2011

$ million

    

PREDECESSOR
Q1 2010

$ million

  

Profit for the period

      7.7       84.7  

Other comprehensive income

       

Foreign currency translation:

       

– Currency translation differences on foreign operations:

       

   Subsidiaries

      107.1       2.6  

   Associates

      0.5       0.9  

– (Loss)/gain on net investment hedges

      (7.6 )      1.9  
     100.0       5.4  

Available-for-sale investments:

       

– Unrealized loss recognized in the period

      (0.1 )      –   
     (0.1 )      –   

Post-employment benefits:

       

– Net actuarial gain

      22.8       –   

– Effect of the asset ceiling

      (13.3 )      –   
       9.5       –   

Other comprehensive income before tax

      109.4       5.4  

Income tax expense on components of other comprehensive income

      (3.3 )      (2.7 ) 

Other comprehensive income after tax

      106.1       2.7  

Comprehensive income for the period

      113.8       87.4  
 

Attributable to:

       

– Equity shareholders in Pinafore Holdings B.V.

      104.8       77.1  

– Non-controlling interests

      9.0       10.3  
       113.8       87.4  

 

F-99

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PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

 

CONDENSED CONSOLIDATED CASH FLOW STATEMENT

(Unaudited)

 

          SUCCESSOR     PREDECESSOR  
      Note   

Q1 2011

$ million

    

Q1 2010

$ million

  

Operating activities

          

Cash generated from/(absorbed by) operations

    7      62.5       (22.9 ) 

Income taxes paid

         (26.5 )      (20.5 ) 

Income taxes received

         0.1       1.3  

Net cash inflow/(outflow) from operating activities

           36.1       (42.1 ) 
 

Investing activities

          

Purchase of property, plant and equipment

         (31.2 )      (24.6 ) 

Purchase of computer software

         (1.0 )      (1.0 ) 

Capitalization of development costs

         –        (0.2 ) 

Disposal of property, plant and equipment

         4.9       7.9  

Investments in associates

         (0.4 )      –   

Purchase of interests in subsidiaries, net of cash acquired

         (1.4 )      (36.8 ) 

Sale of businesses and subsidiaries, net of cash disposed

         2.5       (1.0 ) 

Interest received

         0.5       1.1  

Dividends received from associates

         0.5       0.2  

Net cash outflow from investing activities

           (25.6 )      (54.4 ) 
 

Financing activities

          

Draw-down of bank and other loans

         0.3       –   

Repayment of bank and other loans

         (19.5 )      (0.6 ) 

Premium on redemption of notes

         (0.4 )      –   

Receipts/(payments) on foreign currency derivatives

         8.6       (37.5 ) 

Capital element of finance lease rental payments

         (0.2 )      (0.2 ) 

Interest element of finance lease rental payments

         (0.1 )      (0.1 ) 

Increase in collateralized cash

         (0.1 )      –   

Purchase of own shares

         –        (6.2 ) 

Interest paid

         (81.3 )      (4.4 ) 

Financing costs paid

         (29.5 )      –   

Dividend paid to a minority shareholder in a subsidiary

         (19.9 )      (9.9 ) 

Net cash outflow from financing activities

           (142.1 )      (58.9 ) 
 

Decrease in net cash and cash equivalents

         (131.6 )      (155.4 ) 

Net cash and cash equivalents at the beginning of the period

         452.2       440.2  

Foreign currency translation

         1.9       1.4  

Net cash and cash equivalents at the end of the period

           322.5       286.2  

 

Analysis of net cash and cash equivalents:

        
     SUCCESSOR    PREDECESSOR  
     

As at

April 2,

2011

$ million

   

As at

December 31,

2010

$ million

    

As at

April 3,

2010

$ million

  

Cash and cash equivalents

    327.4       459.3       306.2  

Bank overdrafts

    (4.9)      (7.1 )      (20.0 ) 
     322.5       452.2       286.2  

 

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PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

 

CONDENSED CONSOLIDATED BALANCE SHEET

(Unaudited)

 

        Note   

As at

April 2,

2011

$ million

    

As at

December 31,

2010

$ million

  

Non-current assets

            

Goodwill

      8      1,792.1       1,745.4  

Other intangible assets

      9      2,260.5       2,268.5  

Property, plant and equipment

      10      1,352.6       1,359.1  

Investments in associates

           24.5       23.6  

Trade and other receivables

      11      26.3       26.2  

Deferred tax assets

           10.1       9.6  

Post-employment benefit surpluses

      17      7.1       3.6  
              5,473.2       5,436.0  

Current assets

            

Inventories

      12      737.9       693.5  

Trade and other receivables

      11      1,045.6       914.5  

Income tax recoverable

           8.4       11.0  

Available-for-sale investments

           1.3       1.4  

Cash and cash equivalents

             327.4       459.3  
              2,120.6       2,079.7  

Assets held for sale

      13      42.7       36.6  

Total assets

             7,636.5       7,552.3  
 

Current liabilities

            

Bank overdrafts

      14      (4.9 )      (7.1 ) 

Bank and other loans

      14      (221.8 )      (255.7 ) 

Obligations under finance leases

           (0.4 )      (0.5 ) 

Trade and other payables

      15      (748.6 )      (704.4 ) 

Income tax liabilities

           (115.6 )      (106.8 ) 

Provisions

      18      (59.1 )      (65.6 ) 
              (1,150.4 )      (1,140.1 ) 

Non-current liabilities

            

Bank and other loans

      14      (2,910.4 )      (2,898.9 ) 

Obligations under finance leases

           (3.0 )      (2.8 ) 

Trade and other payables

      15      (41.0 )      (65.4 ) 

Post-employment benefit obligations

      17      (249.5 )      (279.2 ) 

Deferred tax liabilities

           (787.6 )      (793.3 ) 

Provisions

      18      (25.3 )      (24.7 ) 
              (4,016.8 )      (4,064.3 ) 

Liabilities directly associated with assets held for sale

      13      (10.1 )      (8.1 ) 

Total liabilities

             (5,177.3 )      (5,212.5 ) 

Net assets

             2,459.2       2,339.8  
 

Capital and reserves

            

Share capital

           –        –   

Shares to be issued

           17.6       17.6  

Share premium account

           2,124.7       2,124.7  

Other reserves

           114.4       16.2  

Accumulated deficit

             (98.1 )      (130.2 ) 

Shareholders’ equity

           2,158.6       2,028.3  

Non-controlling interests

           300.6       311.5  

Total equity

             2,459.2       2,339.8  

 

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PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(Unaudited)

 

SUCCESSOR   
Q1 2011   

Share

capital

$ million

     

Shares to be

issued

$ million

     

Share

premium

account

$ million

     

Other

reserves

$ million

    

Accumulated

deficit

$ million

    

Total

shareholders’

equity

$ million

    

Non-

controlling

interests

$ million

    

Total

equity

$ million

  

As at December 31, 2010

      –         17.6        2,124.7         16.2        (130.2 )      2,028.3        311.5        2,339.8  

Profit for the period

      –         –         –         –        0.8       0.8       6.9       7.7  

Other comprehensive income

      –         –         –         98.2       5.8       104.0       2.1       106.1  

Total comprehensive income

      –         –         –         98.2       6.6       104.8       9.0       113.8  

Other changes in equity:

                    

– Share-based incentives (including a tax benefit of $0.3 million)

      –         –         –         –        25.5       25.5       –        25.5  

– Dividends paid to minority shareholders

      –         –         –         –        –        –        (19.9 )      (19.9 ) 
       –         –         –         –        25.5       25.5       (19.9 )      5.6  

As at April 2, 2011

      –         17.6        2,124.7         114.4       (98.1 )      2,158.6       300.6       2,459.2  
PREDECESSOR                    
Q1 2010           

Share

capital

$ million

     

Share

premium

account

$ million

     

Other

reserves

$ million

    

Accumulated

deficit

$ million

    

Total

shareholders’

equity

$ million

    

Non-

controlling

interests

$ million

    

Total

equity

$ million

  

As at January 2, 2010

               79.6        799.2        819.7       (161.9 )      1,536.6       141.4       1,678.0  

Profit for the period

         –         –         –        76.0       76.0       8.7       84.7  

Other comprehensive income/(loss)

               –         –         94.1       (93.0 )      1.1       1.6       2.7  

Total comprehensive income/(loss)

               –         –         94.1       (17.0 )      77.1       10.3       87.4  

Other changes in equity:

                    

– Purchase of own shares

         –         –         (6.2 )      –        (6.2 )      –        (6.2 ) 

– Transfer of own shares

         –         –         0.5       (0.5 )      –        –        –   

– Share-based incentives

         –         –         –        3.0       3.0       –        3.0  

– Dividends paid to minority shareholders

               –         –         –        –        –        (9.9 )      (9.9 ) 
                –         –         (5.7 )      2.5       (3.2 )      (9.9 )      (13.1 ) 

As at April 3, 2010

               79.6        799.2        908.1       (176.4 )      1,610.5       141.8       1,752.3  

 

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PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

1 BASIS OF PREPARATION

Pinafore Holdings B.V. (‘the Company’ or ‘the Successor’) was incorporated on September 1, 2010 in and under the laws of The Netherlands.

On September 24, 2010, Tomkins Acquisitions Limited, a wholly-owned subsidiary of the Company, acquired the entire issued ordinary share capital of Tomkins plc (‘Tomkins’ or ‘the Predecessor’). On the acquisition date, Tomkins plc was re-registered as a private company and its name was changed to Tomkins Limited.

Condensed consolidated financial statements are presented for periods preceding and succeeding the acquisition of Tomkins. Prior to the acquisition, Tomkins drew up its financial statements to the Saturday nearest the end of the relevant calendar year or calendar quarter. Accordingly, Predecessor financial statements are presented for the 13-week period from January 3, 2010 to April 3, 2010 (‘Q1 2010’). The Predecessor financial statements do not reflect the effects of the accounting for the acquisition of Tomkins. The Company draws up its annual financial statements to December 31 and its quarterly financial statements to the Saturday nearest the end of the relevant calendar quarter. Accordingly, Successor financial statements are presented for the 13-week period from January 1, 2011 to April 2, 2011 (‘Q1 2011’).

References herein to ‘the Group’ refer, in the period prior to the acquisition of Tomkins, to Tomkins and its subsidiaries and, in the period subsequent to the acquisition of Tomkins, to the Company and its subsidiaries.

The condensed consolidated financial statements have been prepared on a going concern basis in accordance with IAS 34 ‘Interim Financial Reporting’ and were approved by the Board of Directors on May 16, 2011.

Except for the adoption at the beginning of 2011 of ‘Improvements to IFRSs 2010’, which did not have any significant impact on the Group’s results or financial position, the Group’s accounting policies are unchanged compared with the year ended December 31, 2010.

 

2 SEGMENT INFORMATION

 

A) BACKGROUND

The Group’s operating segments are identified by grouping together businesses that manufacture similar products, as this is the basis on which information is provided to the Board for the purposes of allocating resources within the Group and assessing the performance of the Group’s businesses.

The Group is organized for management reporting purposes into two business groups: Industrial & Automotive and Building Products. Within these two business groups, management distinguishes between those of the Group’s operating segments that are ongoing and those that have been exited but do not meet the conditions to be classified as discontinued operations.

Industrial & Automotive manufactures a wide range of systems and components for the industrial equipment, car and truck manufacturing markets, and industrial and automotive aftermarkets throughout the world. Industrial & Automotive is comprised of four ongoing operating segments: Power Transmission, Fluid Power, Sensors & Valves and Other Industrial & Automotive.

Building Products is comprised of two ongoing operating segments: Air Distribution and Bathware. Air Distribution supplies the industrial and residential heating, ventilation and air conditioning market, mainly in North America. Bathware manufactures baths and whirlpools for the residential, and hotel and resort development markets, mainly in North America.

The Board uses adjusted earnings before interest, tax, depreciation and amortization (‘adjusted EBITDA’) to measure the profitability of each segment. Adjusted EBITDA is, therefore, the measure of segment profit or loss presented in the Group’s segment disclosures.

EBITDA represents profit or loss for the period before net finance costs, income taxes, depreciation and amortization. Adjusted EBITDA represents EBITDA before specific items that are considered to hinder comparison of the trading performance of the Group’s businesses either year-on-year or with other businesses.

During the periods under review, the specific items excluded from EBITDA in arriving at adjusted EBITDA were as follows:

 

  •  

the compensation expense in relation to share-based incentives;

 

  •  

transaction costs incurred in business combinations;

 

  •  

restructuring costs; and

 

  •  

the net gain or loss on disposals and on the exit of businesses.

 

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

2 SEGMENT INFORMATION (CONTINUED)

 

B) SALES AND ADJUSTED EBITDA – CONTINUING OPERATIONS

 

             Sales          Adjusted EBITDA  
     

SUCCESSOR

Q1 2011

$ million

     

PREDECESSOR
Q1 2010

$ million

          

SUCCESSOR
Q1 2011

$ million

    

PREDECESSOR
Q1 2010

$ million

  

Ongoing segments

                 

Industrial & Automotive:

                 

– Power Transmission

      592.7         519.2           130.1       110.6  

– Fluid Power

      234.6         180.3           40.3       27.0  

– Sensors & Valves

      120.8         99.7           23.5       15.2  

– Other Industrial & Automotive

      159.5         136.3             14.8       10.8  
       1,107.6         935.5             208.7       163.6  

Building Products:

                 

– Air Distribution

      207.3         197.4           21.8       23.9  

– Bathware

      28.0         33.0             (0.6 )      (0.1 ) 
       235.3         230.4             21.2       23.8  

Corporate

      –         –             (16.4 )      (12.9 ) 

Total ongoing

      1,342.9         1,165.9             213.5       174.5  
   

Exited segment

                 

Building Products:

                 

– Doors & Windows

      –         –             (0.3 )      (0.5 ) 

Total continuing operations

      1,342.9         1,165.9             213.2       174.0  
             Sales          Adjusted EBITDA  
     

SUCCESSOR
Q1 2011

$ million

     

PREDECESSOR
Q1 2010

$ million

          

SUCCESSOR
Q1 2011

$ million

    

PREDECESSOR
Q1 2010

$ million

  

By origin

                 

US

      631.3         562.9           91.8        77.1   

Rest of North America

      165.5         140.7           36.4        25.3   

UK

      106.6         86.0           15.5        12.5   

Rest of Europe

      202.7         174.2           24.8        17.4   

Asia

      162.6         135.7           37.5        31.1   

Rest of the world

      74.2         66.4             7.2        10.6   
       1,342.9         1,165.9             213.2        174.0   

By destination

               

US

      724.8         629.5          

Rest of North America

      116.9         96.2          

UK

      27.2         23.6          

Rest of Europe

      218.2         188.4          

Asia

      170.3         151.9          

Rest of the world

      85.5         76.3          
       1,342.9         1,165.9          

Inter-segment sales were not significant.

 

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PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

2   SEGMENT INFORMATION (CONTINUED)

B)  SALES AND ADJUSTED EBITDA – CONTINUING OPERATIONS (continued)

Reconciliation of profit for the period from continuing operations to adjusted EBITDA:

 

     

SUCCESSOR
Q1 2011

$ million

    

PREDECESSOR

Q1 2010

$ million

  

Profit for the period from continuing operations

      7.7       85.5  

Income tax expense

      19.3       29.2  

Profit before tax

      27.0       114.7  

Net finance costs

      61.9       10.3  

Operating profit

      88.9       125.0  

Amortization

      41.5       5.8  

Depreciation

      52.0       40.3  

EBITDA

      182.4       171.1  

Share-based incentives

      25.2       2.4  

Transaction costs

      0.4       –   

Restructuring costs (see note 3)

      5.4       1.9  

Net gain on disposals and on the exit of businesses (see note 3)

      (0.2 )      (1.4 ) 

Adjusted EBITDA

      213.2       174.0  

 

3 RESTRUCTURING INITIATIVES

Restructuring costs amounting to $15.7 million were recognized during Q1 2011, principally in relation to Project Sierra, a Group-wide initiative that focuses on identifying and implementing cost reduction opportunities and efficiency improvements. Also during Q1 2011, a provision for restructuring costs of $10.3 million was released due to the reversal of the decision to close a division of Stackpole, a business included within the Power Transmission operating segment, following the recovery in the demand for its products.

 

    

SUCCESSOR

Q1 2011

            

PREDECESSOR

Q1 2010

  
     

Restructuring
costs

$ million

     Disposals
and exit of
businesses
$ million		             

Restructuring
costs

$ million

    

Disposals

and exit of
businesses

$ million

  

Ongoing segments

             

Industrial & Automotive:

             

– Power Transmission

      2.1       –            0.2       –   

– Fluid Power

      (3.1 )      –            (2.1 )      –   

– Other Industrial & Automotive

      (0.4 )      0.2                 (0.5 )      (0.2 ) 
       (1.4 )      0.2                 (2.4 )      (0.2 ) 

Building Products:

             

– Air Distribution

      –        –            (0.6 )      (0.1 ) 

– Bathware

      (0.6 )      –                  –        –   
       (0.6 )      –                  (0.6 )      (0.1 ) 

Corporate

      (3.4 )      –                  –        (0.1 ) 

Total ongoing

      (5.4 )      0.2                 (3.0 )      (0.4 ) 

Exited segment

             

Building Products:

             

– Doors & Windows

      –        –                  1.1       1.8  

Total continuing operations

      (5.4 )      0.2                 (1.9 )      1.4  

 

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

4 INTEREST EXPENSE

 

     

SUCCESSOR
Q1 2011

$ million

     

PREDECESSOR

Q1 2010

$ million

  

Borrowings:

        

– Interest on bank overdrafts

      –         2.1  

– Interest on bank and other loans:

        

Term loans

      36.5         –   

Other bank loans

      0.7         0.4  

Second Lien Notes

      29.2         –   

2011 Notes

      3.3         4.7  

2015 Notes

      0.4         5.9  

– Interest on interest rate swaps in designated hedging relationships:

        

Payable

      –         3.5  

Receivable

      –         (10.6 ) 
     70.1         6.0   

Interest element of finance lease rentals

      –         0.1   

Other interest payable

      4.7         1.0   
     74.8         7.1   

Post employment benefits:

        

– Interest cost on benefit obligation

      16.3         17.0   
       91.1         24.1   

 

5 INVESTMENT INCOME

 

     

SUCCESSOR
Q1 2011

$ million

     

PREDECESSOR

Q1 2010

$ million

  

Interest on bank deposits

      0.8         0.8   

Other interest receivable

      0.5         0.4   
     1.3         1.2   

Post employment benefits:

        

– Expected return on plan assets

      16.9         15.0   
       18.2         16.2   

 

6 OTHER FINANCE INCOME/(EXPENSE)

 

     

SUCCESSOR
Q1 2011

$ million

    

PREDECESSOR

Q1 2010

$ million

  

Derivative financial instruments:

       

– Gain on derivatives in designated hedging relationships

      –        0.6  

– Gain on embedded derivatives

      3.0       –   

Currency translation gain/(loss) on hedging instruments

      8.1       (3.0 ) 

Loss on redemption of notes

      (0.1 )      –   
       11.0       (2.4 ) 

 

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

7 CASH FLOW

 

     

SUCCESSOR
Q1 2011

$ million

    

PREDECESSOR

Q1 2010

$ million

  

Profit for the period

      7.7       84.7  

Interest expense

      91.1       24.1  

Investment income

      (18.2 )      (16.2 ) 

Other finance (income)/expense

      (11.0 )      2.4  

Income tax expense

      19.3       28.7  

Operating profit from continuing and discontinued operations

      88.9       123.7  

Share of profit of associates

      (0.3 )      (0.1 ) 

Amortization of intangible assets

      41.5       5.8  

Depreciation of property, plant and equipment

      52.0       40.3  

Gain on disposal of businesses:

       

– Continuing operations

      (0.2 )      (1.4 ) 

– Discontinued operations

      –        1.3  

Loss/(gain) on sale of property, plant and equipment

      0.3       (1.1 ) 

Share-based incentives

      25.2       2.4  

Decrease in post-employment benefit obligations

      (25.3 )      (13.7 ) 

Decrease in provisions

      (8.6 )      (22.0 ) 
     173.5        135.2   
 

Movements in working capital:

       

– Increase in inventories

      (33.6 )      (37.2 ) 

– Increase in receivables

      (110.0 )      (117.4 ) 

– Increase/(decrease) in payables

      32.6       (3.5 ) 

Cash generated from/(absorbed by) operations

      62.5       (22.9 ) 

 

8 GOODWILL

 

      $ million  

Carrying amount

   

As at December 31, 2010

      1,745.4  

Foreign currency translation

      46.7  

As at April 2, 2011

      1,792.1  

 

9 OTHER INTANGIBLES

 

     

Brands and

trade names

$ million

     

Customer
relationships

$ million

    

Technology

and know-how

$ million

    

Computer
software

$ million

    

Total

$ million

  

Carrying amount

            

As at December 31, 2010

      325.9        1,602.5       325.8       14.3       2,268.5  

Additions

      –         –        –        1.0       1.0  

Amortization charge for the period

      –         (26.7 )      (12.0 )      (2.8 )      (41.5 ) 

Foreign currency translation

      0.2        29.5       2.7       0.1       32.5  

As at April 2, 2011

      326.1        1,605.3       316.5       12.6       2,260.5  

 

10 PROPERTY, PLANT AND EQUIPMENT

 

      $ million  

Carrying amount

   

As at December 31, 2010

      1,359.1  

Additions

      31.2  

Depreciation charge for the period

      (52.0 ) 

Transfers to assets held for sale

      (5.9 ) 

Disposals

      (1.5 ) 

Foreign currency translation

      21.7  

As at April 2, 2011

      1,352.6  

 

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

11 TRADE AND OTHER RECEIVABLES

 

     

As at

April 2,

2011

$ million

     

As at

December 31,

2010

$ million

  

Current assets

      

Financial assets:

      

– Trade receivables

      878.9         761.1   

– Derivative financial instruments (see note 16)

      1.2         0.6   

– Collateralized cash

      49.0         47.0   

– Other receivables

      66.0         58.4   
                   
     995.1         867.1   
                   

Non-financial assets:

      

– Prepayments

      50.5         47.4   
                   
     1,045.6         914.5   
                   

Non-current assets

      

Financial assets:

      

– Derivative financial instruments (see note 16)

      1.3         0.9   

– Other receivables

      12.9         13.0   
                   
     14.2         13.9   
                   

Non-financial assets:

      

– Prepayments

      12.1         12.3   
                   
     26.3         26.2   
                   

 

12 INVENTORIES

 

     

As at
April 2,
2011

$ million

     

As at

December 31,

2010

$ million

  

Raw materials and supplies

      253.9         225.5   

Work in progress

      97.7         90.8   

Finished goods and goods held for sale

      386.3         377.2   
                   
     737.9         693.5   
                   

 

13 ASSETS HELD FOR SALE

During the third quarter of 2010, management began actively seeking prospective buyers for Plews Inc., as a result of which its assets and liabilities were classified as held for sale. As described in note 20, Plews Inc. was sold on April 20, 2011.

Assets held for sale also include vacant properties no longer required by the Group for its manufacturing operations.

Assets classified as held for sale and directly associated liabilities were as follows:

 

     

As at

April 2,

2011

$ million

    

As at

December 31,

2010

$ million

  

Assets held for sale

     

Property, plant and equipment

      9.4       7.3  

Inventories

      9.5       7.5  

Trade and other receivables

      20.0       18.0  

Deferred tax assets

      3.8       3.8  
                  
     42.7       36.6  
                  

Liabilities directly associated with assets held for sale

     

Trade and other payables

      (9.5 )      (7.4 ) 

Provisions

      (0.6 )      (0.7 ) 
                  
     (10.1 )      (8.1 ) 
                  
     32.6       28.5  
                  

 

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14 BORROWINGS

 

     As at April 2, 2011      As at December 31, 2010  
     

Current
liabilities

$ million

     

Non-current
liabilities

$ million

     

Total

$ million

     

Current

liabilities

$ million

     

Non-current
liabilities

$ million

     

Total

$ million

  

Carrying amount

                  

Bank overdrafts

      4.9         –         4.9         7.1         –         7.1   

Bank and other loans:

                  

– Secured

      1.4         2,882.4         2,883.8         38.1         2,872.3         2,910.4   

– Unsecured

      220.4         28.0         248.4         217.6         26.6         244.2   
       221.8         2,910.4         3,132.2         255.7         2,898.9         3,154.6   
       226.7         2,910.4         3,137.1         262.8         2,898.9         3,161.7   

The Group’s secured borrowings are jointly and severally, irrevocably and fully and unconditionally guaranteed by certain of the Company’s direct and indirect subsidiaries and secured by liens on substantially all of their assets. An analysis of the security given is presented in note 21.

The carrying amount of borrowings includes the following items, each of which are being amortized to profit or loss over the term of the related borrowings using the effective interest method:

 

  •  

costs incurred on the arrangement and subsequent re-pricing of the Term Loan A and Term Loan B credit facilities and on the issuance of the Second Lien Notes;

 

  •  

the fair value on inception of the interest rate floor (an embedded derivative) that applies to amounts drawn down under the Term Loan A and Term Loan B credit facilities and the change in the fair value of the interest rate floor that resulted from the subsequent re-pricing of the facilities; and

 

  •  

a purchase accounting adjustment to reflect the excess of the fair value of the 2011 Notes and the 2015 Notes over their principal amount on the effective date of the acquisition of Tomkins.

The carrying amount of borrowings may be reconciled to the principal amount outstanding as follows:

 

     

As at

April 2,

2011

$ million

    

As at

December 31,

2010

$ million

  

Carrying amount

      3,137.1       3,161.7  

Issue costs

      184.7       173.8  

Interest rate floor

      44.4       66.1  

Purchase accounting adjustment

      (4.7 )      (6.4 ) 

Accrued interest payable

      (5.9 )      (27.7 ) 

Principal amount

      3,355.6       3,367.5  

The principal amount of borrowings may be analyzed as follows:

 

     As at April 2, 2011      As at December 31, 2010  
     

Current
liabilities

$ million

     

Non-current
liabilities

$ million

     

Total

$ million

     

Current

liabilities

$ million

     

Non-current
liabilities

$ million

     

Total

$ million

  

Principal amount

                  

Bank overdrafts

      4.9         –         4.9         7.1         –         7.1   

Bank and other loans:

                  

– Secured

                  

Term Loan A

      29.6         259.0         288.6         29.6         266.4         296.0   

Term Loan B

      17.0         1,656.1         1,673.1         16.8         1,660.5         1,677.3   

Second Lien Notes

      –         1,150.0         1,150.0         –         1,150.0         1,150.0   
     46.6         3,065.1         3,111.7         46.4         3,076.9         3,123.3   

– Unsecured

                  

2011 Notes

      164.2         –         164.2         165.5         –         165.5   

2015 Notes

      –         27.7         27.7         –         26.5         26.5   

Other loan notes

      46.7         0.4         47.1         45.1         –         45.1   
       210.9         28.1         239.0         210.6         26.5         237.1   
       262.4         3,093.2         3,355.6         264.1         3,103.4         3,367.5   

 

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14 BORROWINGS (CONTINUED)

Bank loans

Senior Secured Credit Facilities

The Group has Senior Secured Credit Facilities consisting of a Term Loan A credit facility, a Term Loan B credit facility and a senior secured revolving credit facility. The Term Loan A credit facility and the revolving credit facility mature on September 29, 2015 and the Term Loan B credit facility matures on September 29, 2016.

The Term Loan A credit facility is subject to quarterly amortization payments of 2.5% and the Term Loan B credit facility is subject to quarterly amortization payments of 0.25%, in each case based on the original principal amount less certain prepayments with the balance payable on maturity. During Q1 2011, the Group made quarterly amortization payments of $7.4 million against the Term Loan A facility and $4.2 million against the Term Loan B facility. As at April 2, 2011, the principal amount outstanding under the Term Loan A credit facility was $288.6 million and that under the Term Loan B credit facility was $1,673.1 million.

The revolving credit facility provides for multi-currency revolving loans and letters of credit up to an aggregate principal amount of $300.0 million, with a letter of credit sub-facility of $100.0 million. As at April 2, 2011, there were no drawings for cash under the revolving credit facility but there were letters of credit outstanding amounting to $39.7 million.

Borrowings under the Senior Secured Credit Facilities bear interest at a floating rate, which can be either LIBOR plus an applicable margin or, at the Group’s option, a base rate as defined in the credit agreement plus an applicable margin. LIBOR and the base rate are both subject to floors. On inception of the facilities, the applicable margin for the Term Loan B credit facility was 4.5% per annum for LIBOR and 3.5% per annum for base rate. The applicable margin for the Term Loan A credit facility and the revolving credit facility was between 3.75% and 4.25% per annum for LIBOR and 2.75% and 3.25% per annum for base rate depending on a total leverage to EBITDA ratio. LIBOR was subject to a 1.75% floor and base rate was subject to a 2.75% floor. Effective February 17, 2011, the Group agreed with the providers of the Senior Secured Credit Facilities a re-pricing of Term Loan A and Term Loan B and amendments to certain of the covenants attaching to the facilities. For both Term Loan A and Term Loan B the applicable margin for LIBOR was reduced to 3.0% per annum, with LIBOR being subject to a 1.25% floor, and the applicable margin for base rate was reduced to 2.0% per annum, with base rate being subject to a 2.25% floor. Management considered that the re-pricing did not cause a substantial change in the net present value of the expected future cash flows in relation to the facilities. Accordingly, the Group recognized neither a gain nor a loss on the re-pricing and recognized the associated costs of $23.4 million and the decrease of $18.1 million in the interest rate floor liability as adjustments to the carrying amounts of the borrowings outstanding under the facilities.

As at April 2, 2011, borrowings under both Term Loan A and Term Loan B attracted an interest rate of 4.25% per annum (in both cases, to be next re-set on June 30, 2011). Each letter of credit issued under the revolving credit facility attracts a participation fee equal to the applicable LIBOR margin under the revolving credit facility to the maximum amount available to be drawn and a fronting fee of the greater of 0.25% of the maximum amount available to be drawn and $1,500 per annum. An unused line fee of 0.75% per annum is based on the unused portion of the revolving credit facility (which may decrease to 0.5% per annum based on a total leverage to EBITDA ratio).

Other borrowings

Second Lien Notes

As at April 2, 2011, the Group had outstanding $1,150.0 million 9% Senior Secured Second Lien Notes (‘the Second Lien Notes’).

The Second Lien Notes mature on October 1, 2018.

On and after October 1, 2014, the Group may redeem the Second Lien Notes, at its option, in whole at any time or in part from time to time, at the following redemption prices (expressed as percentage of the principal amount), plus accrued and unpaid interest to the redemption date:

 

      Redemption price  

During the year commencing:

   

– October 1, 2014

      104.50%   

– October 1, 2015

      102.25%   

– October 1, 2016 and thereafter

      100.00%   

At any time prior to October 1, 2014, the Group may redeem the Second Lien Notes at its option, in whole at any time or in part from time to time, at 100% of the principal amount thereof plus the greater of (i) 1% of the principal amount and (ii) the excess of the present value at the redemption date of the redemption price as at October 1, 2014 and the required interest payments due from the redemption date to October 1, 2014 (discounted using an appropriate US Treasury Rate plus 50 basis points) over the principal amount, plus accrued and unpaid interest to the redemption date.

At any time, or from time to time, prior to October 1, 2013, but not more than once in any twelve-month period, the Group may redeem up to 10% of the original aggregate principal amount of the Second Lien Notes at a redemption price of 103% of the principal amount thereof plus accrued and unpaid interest thereon up to but not including the redemption date.

 

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14 BORROWINGS (CONTINUED)

Notwithstanding the foregoing, at any time and from time to time prior to October 1, 2013, the Group may redeem in the aggregate up to 35% of the original aggregate principal amount of the Second Lien Notes (calculated after giving effect to any issuance of additional Second Lien Notes) with the net cash proceeds of equity offerings by Pinafore Coöperatief U.A., the Company’s parent undertaking, or certain of its subsidiaries at a redemption price of 109% of the principal amount thereof plus accrued and unpaid interest thereon up to but not including the redemption date, provided that at least 65% of the original aggregate principal amount of the Second Lien Notes remain outstanding after each such redemption (calculated after giving effect to any issuance of additional Second Lien Notes) and the Group satisfies certain other conditions.

In the event of a change of control over the Company, each holder will have the right to require the Group to repurchase all or any part of such holder’s Second Lien Notes at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest to the date of repurchase, except to the extent that the Group has previously elected to redeem the Second Lien Notes.

2011 Notes and 2015 Notes

When it was acquired by the Group, Tomkins had in issue 8% notes repayable at par on December 20, 2011 (the ‘2011 Notes’) and 6.125% notes repayable at par on September 16, 2015 (the ‘2015 Notes’).

During Q1 2011, the Group settled £4.9 million of the 2011 Notes for which acceptances were received in response to its offer to purchase that was made on December 30, 2010. As at April 2, 2011, the principal amount outstanding of the 2011 Notes was £102.1 million and that of the 2015 Notes was £17.2 million.

Other loan notes

Other loan notes principally comprise the loan notes that certain shareholders in Tomkins Limited elected to receive as an alternative to cash in respect of all or part of the consideration payable to them by the Group on the acquisition of Tomkins (the ‘Loan Note Alternative’). As at April 2, 2011, loan notes with a principal amount of £29.0 million were outstanding under the Loan Note Alternative. The loan notes accrue interest at the higher of 0.8% below LIBOR and 0% (to be next re-set on July 1, 2011).

The loan notes fall due for repayment, at par, on December 31, 2015. From June 30, 2011 until December 31, 2015, each holder has the right to require full or part repayment, at par, half-yearly on June 30 and December 31 and for this reason these loan notes are classified as current liabilities. The Group may purchase some or all of the loan notes at any time and at any price by tender, private treaty or otherwise.

Although the loan notes are unsecured, the Group is required to retain in an escrow account cash equivalent to the nominal amount of the outstanding loan notes.

 

15 TRADE AND OTHER PAYABLES

 

     

As at

April 2,

2011

$ million

     

As at

December 31,

2010

$ million

  

Current liabilities

      

Financial liabilities:

      

– Trade payables

      476.8         419.3   

– Other taxes and social security

      32.5         25.1   

– Derivative financial instruments (see note 16)

      0.7         0.9   

– Other payables

      53.6         64.2   
       563.6         509.5   

Non-financial liabilities:

      

– Accruals and deferred income

      185.0         194.9   
       748.6         704.4   

Non-current liabilities

      

Financial liabilities:

      

– Derivative financial instruments (see note 16)

      26.1         48.3   

– Other payables

      11.6         8.3   
       37.7         56.6   

Non-financial liabilities:

      

– Accruals and deferred income

      3.3         8.8   
       41.0         65.4   

 

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

16 DERIVATIVE FINANCIAL INSTRUMENTS

The carrying amount of derivative financial instruments held by the Group was as follows:

 

       As at April 2, 2011        As at December 31, 2010  
       

Assets

$ million

       

Liabilities

$ million

       

Total

$ million

       

Assets

$ million

       

Liabilities

$ million

       

Total

$ million

  

Hedging activities

                              

Translational hedges:

                              

– Currency swaps

        1.3          (0.4 )         0.9          0.9           (1.4 )         (0.5 ) 
         1.3          (0.4 )         0.9          0.9           (1.4 )         (0.5 ) 

Transactional hedges:

                              

– Currency forwards

        1.2          (0.1 )         1.1          0.6           (0.1 )         0.5  

– Commodity contracts

        –           (0.6 )         (0.6 )         –           (0.8 )         (0.8 ) 
         1.2          (0.7 )         0.5          0.6           (0.9 )         (0.3 ) 
         2.5          (1.1 )         1.4          1.5           (2.3 )         (0.8 ) 

Other items

                              

Embedded derivatives

        –           (25.7 )         (25.7 )         –           (46.9 )         (46.9 ) 
         2.5          (26.8 )         (24.3 )         1.5           (49.2 )         (47.7 ) 

Classified as:

                              

– Current

        1.2          (0.7 )         0.5          0.6           (0.9 )         (0.3 ) 

– Non-current

        1.3          (26.1 )         (24.8 )         0.9           (48.3 )         (47.4 ) 
         2.5          (26.8 )         (24.3 )         1.5           (49.2 )         (47.7 ) 

 

17 POST-EMPLOYMENT BENEFIT OBLIGATIONS

The net liability recognized as at April 2, 2011 in respect of post-employment benefits was as follows:

 

     

Pensions

$ million

    

Other post-
employment benefits

$ million

    

Total

$ million

  

Present value of the benefit obligation

      (1,121.3 )      (127.5 )      (1,248.8 ) 

Fair value of plan assets

      1,048.9       –        1,048.9  
     (72.4 )      (127.5 )      (199.9 ) 

Effect of the asset ceiling

      (42.5 )      –        (42.5 ) 

Net liability

      (114.9 )      (127.5 )      (242.4 ) 
The net liability is presented in the Group’s balance sheet as follows:       
     

Pensions

$ million

    

Other post-
employment benefits

$ million

    

Total

$ million

  

Surpluses

      7.1       –        7.1  

Deficits

      (122.0 )      (127.5 )      (249.5 ) 

Net liability

      (114.9 )      (127.5 )      (242.4 ) 
Changes in the net liability during Q1 2011 were as follows:       
     

Pensions

$ million

    

Other post-
employment benefits

$ million

    

Total

$ million

  

Net liability as at December 31, 2010

      (145.6 )      (130.0 )      (275.6 ) 

– Current service cost

      (0.8 )      –        (0.8 ) 

– Interest cost

      (14.7 )      (1.6 )      (16.3 ) 

– Expected return on plan assets

      16.9       –        16.9  

– Net actuarial gain

      20.4       2.4       22.8  

– Contributions

      23.5       2.7       26.2  

– Foreign currency translation

      (1.3 )      (1.0 )      (2.3 ) 
       (101.6 )      (127.5 )      (229.1 ) 

Effect of the asset ceiling

      (13.3 )      –        (13.3 ) 

Net liability as at April 2, 2011

      (114.9 )      (127.5 )      (242.4 ) 

 

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17 POST-EMPLOYMENT BENEFIT OBLIGATIONS (CONTINUED)

The weighted average discount rates used in determining the net liability were as follows:

 

     

As at

April 2,

2011

     

As at

December 31,

2010

  

Pensions:

      

– UK

      5.50%         5.50%   

– US

      5.50%         5.38%   

– Other countries

      4.73%         4.52%   

Other benefits

      5.50%         5.28%   

 

18 PROVISIONS

 

      $ million  

As at December 31, 2010

      91.0  

Charge for the period

      20.2  

Utilized during the period

      (17.6 ) 

Released during the period

      (10.9 ) 

Foreign currency translation

      2.3  

As at April 2, 2011

      85.0  

Provisions are presented in the Group’s balance sheet as follows:

 

     

As at

April 2,

2011

$ million

     

As at

December 31,

2010

$ million

  

Ongoing businesses:

      

– Current liabilities

      59.1         65.6   

– Non-current liabilities

      25.3         24.7   
     84.4         90.3   

Businesses to be sold (see note 13)

      0.6         0.7   
       85.0         91.0   

 

19 CONTINGENCIES

The Group is, from time to time, party to legal proceedings and claims, which arise in the ordinary course of business. The Directors do not anticipate that the outcome of any current proceedings or known claims, either individually or in aggregate, will have a material adverse effect upon the Group’s financial position.

 

20 SUBSEQUENT EVENT

Plews Inc., a wholly-owned manufacturer of automotive lubrication products and repair tools that is included in the Other Industrial & Automotive operating segment, was sold on April 20, 2011, to a consortium of investors in the US led by the private equity firm, Eigen Capital LLC. The cash consideration of $25.0 million received on the disposal approximated to the carrying amount of the net assets sold.

 

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21 CONDENSED CONSOLIDATING FINANCIAL INFORMATION

The Senior Secured Credit Facilities and the Second Lien Notes were issued by Tomkins, Inc. and Tomkins, LLC (‘the Issuers’), which are both wholly-owned subsidiaries of the Company, and are jointly and severally, irrevocably and fully and unconditionally guaranteed by the Company and certain other of the Company’s wholly-owned subsidiaries (‘the Guarantors’).

Supplemental condensed consolidating financial information is presented below comprising the Group’s income statements and cash flow statements for Q1 2011 and Q1 2010 and its balance sheets as at April 2, 2011 and December 31, 2010, showing the amounts attributable to the Company, the Issuers and those of its other subsidiaries that were Guarantors as at April 2, 2011 separately from the amounts attributable to those of its subsidiaries that were not Guarantors. The condensed consolidating financial information is prepared in accordance with the Group’s accounting policies, except that investments in subsidiaries are accounted for by their parent company under the equity method of accounting. Under the equity method of accounting, the parent company’s income statement includes on one line its share of the profit or loss of its subsidiary undertakings and the parent company’s balance sheet includes on one line its share of the net assets of its subsidiary undertakings.

 

A) CONSOLIDATED INCOME STATEMENT

  Q1 2011

     

Company

$ million

    

Issuers

$ million

    

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total
Group

$ million

  

Continuing operations

             

Sales

      –        –        886.8       640.2       (184.1 )      1,342.9  

Cost of sales

      –        –        (636.2 )      (471.7 )      184.1       (923.8 ) 

Gross profit

      –        –        250.6       168.5       –        419.1  

Distribution costs

      –        –        (97.0 )      (43.6 )      –        (140.6 ) 

Administrative expenses

      –        –        (131.4 )      (52.9 )      –        (184.3 ) 

Transaction costs

      (0.1 )      –        (0.3 )      –        –        (0.4 ) 

Restructuring costs

      –        –        (12.6 )      7.2       –        (5.4 ) 

Net gain on disposals and on the exit of businesses

      –        –        0.2       –        –        0.2  

Share of profit/(loss) of associates

      –        –        0.4       (0.1 )      –        0.3  

Operating (loss)/profit

      (0.1 )      –        9.9       79.1       –        88.9  

    

             

Interest expense

      –        (67.5 )      (87.0 )      (9.0 )      72.4       (91.1 ) 

Investment income

      –        63.3       21.5       5.8       (72.4 )      18.2  

Other finance income

      –        0.6       10.4       –        –        11.0  

Net finance costs

      –        (3.6 )      (55.1 )      (3.2 )      –        (61.9 ) 

Share of profits of subsidiaries under the equity method

      0.9       –        64.0       –        (64.9 )      –   

Profit/(loss) before tax

      0.8       (3.6 )      18.8       75.9       (64.9 )      27.0  

Income tax expense

      –        –        (17.9 )      (11.4 )      10.0       (19.3 ) 

Profit/(loss) for the period

      0.8       (3.6 )      0.9       64.5       (54.9 )      7.7  

Non-controlling interests

      –        –        –        (6.9 )      –        (6.9 ) 

Profit/(loss) for the period attributable to equity shareholders

      0.8       (3.6 )      0.9       57.6       (54.9 )      0.8  

 

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

21 CONDENSED CONSOLIDATING FINANCIAL INFORMATION (CONTINUED)

 

B) CONSOLIDATED INCOME STATEMENT

Q1 2010

     

Company

$ million

     

Issuers

$ million

     

Other
guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total Group

$ million

  

Continuing operations

               

Sales

      –         –         758.0       546.2       (138.3 )      1,165.9  

Cost of sales

      –         –         (535.9 )      (403.0 )      137.0       (801.9 ) 

Gross profit

      –         –         222.1       143.2       (1.3 )      364.0  

Distribution costs

      –         –         (89.9 )      (35.8 )      –        (125.7 ) 

Administrative expenses

      –         –         (74.7 )      (38.2 )      –        (112.9 ) 

Restructuring costs

      –         –         (1.6 )      (0.3 )      –        (1.9 ) 

Net (loss)/gain on disposals and on the exit of businesses

      –         –         (0.3 )      1.7       –        1.4  

Share of profit of associates

      –         –         –        0.1       –        0.1  

Operating profit

      –         –         55.6       70.7        (1.3 )      125.0  

    

               

Interest expense

      –         –         (24.1 )      (7.0 )      7.0       (24.1 ) 

Investment income

      –         –         17.6       5.6       (7.0 )      16.2  

Other finance expense

      –         –         (2.4 )      –        –        (2.4 ) 

Net finance costs

      –         –         (8.9 )      (1.4 )      –        (10.3 ) 

Share of profits of subsidiaries under the equity method

      –         –         44.6       –        (44.6 )      –   

Profit before tax

      –         –         91.3       69.3       (45.9 )      114.7  

Income tax expense

      –         –         (14.5 )      (15.4 )      0.7       (29.2 ) 

Profit for the period from continuing operations

      –         –         76.8       53.9       (45.2 )      85.5  

Discontinued operations

               

Loss for the period from discontinued operations

      –         –         (0.8 )      –        –        (0.8 ) 

Profit for the period

      –         –         76.0       53.9       (45.2 )      84.7  

Non-controlling interests

      –         –         –        (8.7 )      –        (8.7 ) 

Profit for the period attributable to equity shareholders

      –         –         76.0       45.2       (45.2 )      76.0  

 

F-115

Table of Contents

PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

21 CONDENSED CONSOLIDATING FINANCIAL INFORMATION (CONTINUED)

 

C) CONSOLIDATED CASH FLOW STATEMENT

 

Q1 2011   

Company

$ million

    

Issuers

$ million

    

Other

guarantor

subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation

adjustments

$ million

    

Total Group

$ million

  

Operating activities

             

Cash (absorbed by)/generated from operations

      (0.2 )      –        (24.6 )      87.3       –        62.5  

Income taxes paid

      –        –        (2.6 )      (23.9 )      –        (26.5 ) 

Income taxes received

      –        –        –        0.1       –        0.1  

Net cash (outflow)/inflow from operating activities

      (0.2 )      –        (27.2 )      63.5       –        36.1  

Investing activities

             

Purchase of property, plant and equipment

      –        –        (15.8 )      (18.2 )      2.8       (31.2 ) 

Purchase of computer software

      –        –        (0.6 )      (0.4 )      –        (1.0 ) 

Disposal of property, plant and equipment

      –        –        0.3       7.4       (2.8 )      4.9  

Investments in associates

      –        –        (0.4 )      –        –        (0.4 ) 

Purchase of interests in subsidiaries, net of cash acquired

      –        –        (5.1 )      (0.6 )      4.3       (1.4 ) 

Sale of businesses and subsidiaries, net of cash disposed

      –        –        2.5       –        –        2.5  

Interest received

      –        63.3       6.1       3.8       (72.7 )      0.5  

Dividends received from associates

      –        –        0.3       0.2       –        0.5  

Dividends received from subsidiaries

      –        –        34.7       –        (34.7 )      –   

Net cash inflow/(outflow) from investing activities

      –        63.3       22.0       (7.8 )      (103.1 )      (25.6 ) 

Financing activities

             

Issue of ordinary shares

      –        –        –        4.3       (4.3 )      –   

Draw down of bank and other loans

      –        –        –        0.3       –        0.3  

Repayment of bank and other loans

      –        (11.6 )      (7.9 )      –        –        (19.5 ) 

Premium on redemption of notes

      –        –        (0.4 )      –        –        (0.4 ) 

Loans from/(to) Group companies

      0.2       84.2       (67.2 )      (17.2 )      –        –   

Payments on foreign currency derivatives

      –        –        8.6       –        –        8.6  

Capital element of finance lease rental payments

      –        –        (0.1 )      (0.1 )      –        (0.2 ) 

Interest element of finance lease rental payments

      –        –        (0.1 )      –        –        (0.1 ) 

Increase in collateralized cash

      –        –        –        (0.1 )      –        (0.1 ) 

Interest paid

      –        (81.2 )      (67.1 )      (5.7 )      72.7       (81.3 ) 

Financing costs paid

      –        (29.5 )      –        –        –        (29.5 ) 

Equity dividend paid

      –        –        –        (34.7 )      34.7       –   

Dividend paid to a minority shareholder in a subsidiary

      –        –        –        (19.9 )      –        (19.9 ) 

Net cash inflow/(outflow) from financing activities

      0.2       (38.1 )      (134.2 )      (73.1 )      103.1       (142.1 ) 

Increase/(decrease) in net cash and cash equivalents

      –        25.2       (139.4 )      (17.4 )      –        (131.6 ) 

Net cash and cash equivalents at the beginning of the period

      –        3.1       226.1       223.0       –        452.2  

Foreign currency translation

      –        –        (0.3 )      2.2       –        1.9  

Net cash and cash equivalents at the end of the period

      –        28.3       86.4       207.8       –        322.5  

 

F-116

Table of Contents

PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

21 CONDENSED CONSOLIDATING FINANCIAL INFORMATION (CONTINUED)

 

D) CONSOLIDATED CASH FLOW STATEMENT

 

Q1 2010   

Company

$ million

     

Issuers

$ million

     

Other
Guarantor
subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total Group

$ million

  

Operating activities

               

Cash (absorbed by)/generated from operations

      –         –         (28.3 )      5.4       –        (22.9 ) 

Income taxes paid

      –         –         (7.3 )      (13.2 )      –        (20.5 ) 

Income taxes received

      –         –         0.8       0.5       –        1.3  
                                                    

Net cash outflow from operating activities

      –         –         (34.8 )      (7.3 )      –        (42.1 ) 
                                                    

Investing activities

               

Purchase of property, plant and equipment

      –         –         (11.9 )      (12.9 )      0.2       (24.6 ) 

Purchase of computer software

      –         –         (0.8 )      (0.2 )      –        (1.0 ) 

Capitalization of development costs

      –         –         (0.2 )      –        –        (0.2 ) 

Disposal of property, plant and equipment

      –         –         1.4       6.7       (0.2 )      7.9  

Purchase of interests in subsidiaries, net of cash acquired

      –         –         (40.8 )      (0.1 )      4.1       (36.8 ) 

Sale of businesses and subsidiaries, net of cash disposed

      –         –         (1.0 )      0.1       (0.1 )      (1.0 ) 

Interest received

      –         –         4.4       3.7       (7.0 )      1.1  

Dividends received from associates

      –         –         –        0.2       –        0.2  

Dividends received from subsidiaries

      –         –         18.2       –        (18.2 )      –   
                                                    

Net cash outflow from investing activities

      –         –         (30.7 )      (2.5 )      (21.2 )      (54.4 ) 
                                                    

Financing activities

               

Issue of ordinary shares

      –         –         –        4.0       (4.0 )      –   

Repayment of bank and other loans

      –         –         –        (0.6 )      –        (0.6 ) 

Loans (to)/from Group companies

      –         –         (11.6 )      11.6 )      –        –   

Payments on foreign currency derivatives

      –         –         (37.5 )      –        –        (37.5 ) 

Capital element of finance lease rental payments

      –         –         (0.1 )      (0.1 )      –        (0.2 ) 

Interest element of finance lease rental payments

      –         –         (0.1 )      –        –        (0.1 ) 

Purchase of own shares

      –         –         (6.2 )      –        –        (6.2 ) 

Interest paid

      –         –         (7.2 )      (4.2 )      7.0       (4.4 ) 

Equity dividend paid

      –         –         –        (18.2 )      18.2       –   

Dividend paid to a minority shareholder in a subsidiary

      –         –         –        (9.9 )      –        (9.9 ) 
                                                    

Net cash outflow from financing activities

      –         –         (62.7 )      (17.4 )      21.2       (58.9 ) 
                                                    

Decrease in net cash and cash equivalents

      –         –         (128.2 )      (27.2 )      –        (155.4 ) 

Net cash and cash equivalents at the beginning of the period

      –         –         236.6       203.6       –        440.2  

Foreign currency translation

      –         –         (0.9 )      2.3       –        1.4  
                                                    

Net cash and cash equivalents at the end of the period

      –         –         107.5       178.7       –        286.2  
                                                    

 

F-117

Table of Contents

PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

21 CONDENSED CONSOLIDATING FINANCIAL INFORMATION (CONTINUED)

 

E) CONSOLIDATED BALANCE SHEET

 

As at April 2, 2011   

Company

$ million

    

Issuers

$ million

    

Other

Guarantor

subsidiaries

$ million

    

Non-

guarantor

subsidiaries

$ million

    

Consolidation

adjustments

$ million

    

Total Group

$ million

  

Non-current assets

             

Goodwill

      –        –        818.7       973.4       –        1,792.1  

Other intangible assets

      –        –        1,472.9       787.6       –        2,260.5  

Property, plant and equipment

      –        –        655.3       697.3       –        1,352.6  

Investments in subsidiaries under the equity method

      2,141.2       –        3,142.3       –        (5,283.5 )      –   

Investments in associates

      –        –        21.8       2.7       –        24.5  

Trade and other receivables

      –        10.1       12.7       3.5       –        26.3  

Deferred tax assets

      –        –        0.8       6.4       2.9       10.1  

Post-employment benefit surpluses

      –        –        –        7.1       –        7.1  
       2,141.2       10.1       6,124.5       2,478.0       (5,280.6 )      5,473.2  

Current assets

             

Inventories

      –        –        454.2       297.6       (13.9 )      737.9  

Trade and other receivables

      17.6       3,164.3       1,242.0       1,525.0       (4,903.3 )      1,045.6  

Income tax recoverable

      –        –        0.4       8.0       –        8.4  

Available-for-sale investments

      –        –        –        1.3       –        1.3  

Cash and cash equivalents

      –        28.3       90.7       208.4       –        327.4  
       17.6       3,192.6       1,787.3       2,040.3       (4,917.2 )      2,120.6  

Assets held for sale

      –        –        39.4       3.3       –        42.7  

Total assets

      2,158.8       3,202.7       7,951.2       4,521.6       (10,197.8 )      7,636.5  

Current liabilities

             

Bank overdrafts

      –        –        (4.3 )      (0.6 )      –        (4.9 ) 

Bank and other loans

      –        (1.4 )      (220.4 )      –        –        (221.8 ) 

Obligations under finance leases

      –        –        (0.2 )      (0.2 )      –        (0.4 ) 

Trade and other payables

      –        (3.6 )      (500.1 )      (460.4 )      215.5       (748.6 ) 

Income tax liabilities

      –        –        (74.9 )      (40.7 )      –        (115.6 ) 

Provisions

      –        –        (28.1 )      (31.0 )      –        (59.1 ) 
       –        (5.0 )      (828.0 )      (532.9 )      215.5       (1,150.4 ) 

Non-current liabilities

             

Bank and other loans

      –        (2,882.3 )      (27.7 )      (0.4 )      –        (2,910.4 ) 

Obligations under finance leases

      –        –        (3.0 )      –        –        (3.0 ) 

Trade and other payables

      (0.2 )      (144.5 )      (4,165.2 )      (419.0 )      4,687.9       (41.0 ) 

Post-employment benefit obligations

      –        –        (176.0 )      (73.5 )      –        (249.5 ) 

Deferred tax liabilities

      –        (7.2 )      (576.7 )      (203.7 )      –        (787.6 ) 

Income tax liabilities

      –        –        –        –        –        –   

Provisions

      –        –        (23.3 )      (2.0 )      –        (25.3 ) 
       (0.2 )      (3,034.0 )      (4,971.9 )      (698.6 )      4,687.9       (4,016.8 ) 

Liabilities directly associated with assets held for sale

              –        (10.1 )      –        –        (10.1 ) 

Total liabilities

      (0.2 )      (3,039.0 )      (5,810.0 )      (1,231.5 )      4,903.4       (5,177.3 ) 

Net assets

      2,158.6       163.7       2,141.2       3,290.1       (5,294.4 )      2,459.2  

Capital and reserves

             

Shareholders’ equity

      2,158.6       163.7       2,141.2       2,989.5       (5,294.4 )      2,158.6  

Non-controlling interests

      –        –        –        300.6       –        300.6  

Total equity

      2,158.6       163.7       2,141.2       3,290.1       (5,294.4 )      2,459.2  

 

F-118

Table of Contents

PINAFORE HOLDINGS B.V. AND SUBSIDIARIES

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

 

21 CONDENSED CONSOLIDATING FINANCIAL INFORMATION (CONTINUED)

 

F) CONSOLIDATED BALANCE SHEET

 

As at December 31, 2010   

Company

$ million

     

Issuers

$ million

    

Other

guarantor
subsidiaries

$ million

    

Non-

guarantor
subsidiaries

$ million

    

Consolidation
adjustments

$ million

    

Total Group

$ million

  

Non-current assets

              

Goodwill

      –         –        809.2       936.2       –        1,745.4  

Other intangible assets

      –         –        1,487.7       780.8       –        2,268.5  

Property, plant and equipment

      –         –        669.9       689.2       –        1,359.1  

Investments in subsidiaries under the equity method

      2,010.8        –        3,002.7       –        (5,013.5 )      –   

Investments in associates

      –         –        20.7       2.9       –        23.6  

Trade and other receivables

      –         10.1        12.5       3.6       –        26.2  

Deferred tax assets

      –         –        –        31.9       (22.3 )      9.6  

Post-employment benefit surpluses

      –         –        –        3.6       –        3.6  
       2,010.8        10.1        6,002.7       2,448.2       (5,035.8 )      5,436.0  

Current assets

              

Inventories

      –         –        435.7       271.6       (13.8 )      693.5  

Trade and other receivables

      17.5        3,223.6        1,069.0       1,424.5       (4,820.1 )      914.5  

Income tax recoverable

      –         –        8.3       2.7       –        11.0  

Available-for-sale investments

      –         –        –        1.4       –        1.4  

Cash and cash equivalents

      –         3.1        228.5       227.7       –        459.3  
       17.5        3,226.7        1,741.5       1,927.9       (4,833.9 )      2,079.7  

Assets held for sale

      –         –        29.7       6.9       –        36.6  

Total assets

      2,028.3        3,236.8        7,773.9       4,383.0       (9,869.7 )      7,552.3  

Current liabilities

              

Bank overdrafts

      –         –        (2.4 )      (4.7 )      –        (7.1 ) 

Bank and other loans

      –         (37.9 )      (217.8 )      –        –        (255.7 ) 

Obligations under finance leases

      –         –        (0.2 )      (0.3 )      –        (0.5 ) 

Trade and other payables

      –         (44.0 )      (436.5 )      (422.3 )      198.4       (704.4 ) 

Income tax liabilities

      –         –        (68.0 )      (38.8 )      –        (106.8 ) 

Provisions

      –         –        (25.5 )      (40.1 )      –        (65.6 ) 
       –         (81.9 )      (750.4 )      (506.2 )      198.4       (1,140.1 ) 

Non-current liabilities

              

Bank and other loans

      –         (2,872.3 )      (26.6 )      –        –        (2,898.9 ) 

Obligations under finance leases

      –         –        (2.8 )      –        –        (2.8 ) 

Trade and other payables

      –         (107.5 )      (4,169.3 )      (410.4 )      4,621.8        (65.4 ) 

Post-employment benefit obligations

      –         –        (204.6 )      (74.6 )      –        (279.2 ) 

Deferred tax liabilities

      –         (7.2 )      (578.5 )      (232.9 )      25.3       (793.3 ) 

Income tax liabilities

      –         –        –        –        –        –   

Provisions

      –         –        (22.8 )      (1.9 )      –        (24.7 ) 
       –         (2,987.0 )      (5,004.6 )      (719.8 )      4,647.1        (4,064.3 ) 

Liabilities directly associated with assets held for sale

      –         –        (8.1 )      –        –        (8.1 ) 

Total liabilities

      –         (3,068.9 )      (5,763.1 )      (1,226.0 )      4,845.5       (5,212.5 ) 

Net assets

      2,028.3        167.9       2,010.8       3,157.0       (5,024.2 )      2,339.8  

Capital and reserves

              

Shareholders’ equity

      2,028.3        167.9       2,010.8       2,845.5       (5,024.2 )      2,028.3  

Non-controlling interests

      –         –        –        311.5       –        311.5  

Total equity

      2,028.3        167.9       2,010.8       3,157.0       (5,024.2 )      2,339.8  

 

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PROSPECTUS

LOGO

Tomkins, LLC

Tomkins, Inc.

OFFER TO EXCHANGE

 

 

Up to $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 issued by Tomkins, LLC and Tomkins, Inc., as co-issuers, which have been registered under the Securities Act of 1933, for any and all outstanding 9% Senior Secured Second Lien Notes due 2018 (CUSIP Nos. 693492 AC4 and U72209 AB2) issued by Tomkins, LLC and Tomkins, Inc., as co-issuers.

Until                     , 201  , all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

, 2011

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Indemnification of Directors and Officers.

We carry directors’ and officers’ insurance, which covers our directors and officers against certain liabilities they may incur when acting in their capacity as directors or officers. Certain of these individuals serve at our request as directors or officers of the additional registrants. In addition to potential indemnification and advancement that may be available from us, the directors and officers of the additional registrants may also be entitled to indemnification and advancement to the extent provided in the applicable additional registrant’s organizational documents or under the laws under which the additional registrants are organized, as described below.

Colorado Corporate Guarantor

Gates Development Corporation

Colorado Business Corporation Act

The Colorado Corporate Guarantor is organized as a corporation under the laws of the State of Colorado pursuant to Colorado Revised Statutes, §§ 7-101-101 et. seq., which is also known as the Colorado Business Corporation Act (the “CBCA”).

Pursuant to the CBCA, in the case of both third-party or derivative actions, a corporation may indemnify a director or officer, or a former director or officer or a person who acts or acted at the corporation’s request as a director or officer, or an individual acting in a similar capacity of another entity (whom, we refer to in this document as a “person”) against all cost, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the person in any civil, criminal, administrative, investigative or other proceeding (each, a “Proceeding”) in which the person is involved because of that association, if:

 

  (a) The person conducted himself or herself in good faith; and

 

  (b) The person reasonably believed:

(I) In the case of conduct in an official capacity with the corporation, that his or her conduct was in the corporation’s best interests; and

(II) In all other cases, that his or her conduct was at least not opposed to the corporation’s best interests; and

(c) In the case of any criminal proceeding, the person had no reasonable cause to believe his or her conduct was unlawful.

Further, unless limited by its articles of incorporation, a corporation is required to indemnify a director who was wholly successful, on the merits or otherwise, in defense of any proceeding to which the person was a party because the person is or was a director.

Except as ordered by a court, however, no indemnification is to be made (i) in connection with any Proceeding brought by or in the right of the corporation where the person involved is adjudged to be liable to the corporation, or (ii) in connection with any other Proceeding charging that the person derived an improper personal benefit, whether or not involving action in an official capacity, in which Proceeding the person is adjudged liable on the basis that the person derived an improper personal benefit.

The CBCA provides that a corporation may provide (in its bylaws or by action of its directors or shareholders) for indemnification of its officers, who are not also directors of the corporation, to a greater extent than the indemnification provided to its directors.

The CBCA provides that a corporation may pay for or reimburse the reasonable expenses incurred by a person who is a party to a Proceeding in advance of the final disposition of the Proceeding if:

(a) The person furnishes the corporation a written affirmation of the person’s good-faith belief that he or she has met the standard of conduct described above;

 

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(b) The person furnishes the corporation a written undertaking, executed personally or on the person’s behalf, to repay the advance if it is ultimately determined that he or she did not meet such standard of conduct; and

(c) A determination is made that the facts then known to those making the determination would not preclude indemnification under this article.

Pursuant to the CBCA, a corporation may purchase and maintain insurance on behalf of a person who is or was a director, officer, employee, fiduciary or agent of the corporation, or who, while a director, officer, employee, fiduciary or agent of the corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee, fiduciary or agent of another domestic or foreign entity or of an employee benefit plan, against liability asserted against or incurred by the person in that capacity or arising from the person’s status as a director, officer, employee, fiduciary or agent. The corporation may purchase such insurance whether or not the corporation would have the power to indemnify the person against the same liability pursuant to the CBCA.

The CBCA provides that, if so provided in a corporation’s articles of incorporation, the corporation shall limit or eliminate the personal liability of a director to the corporation or its shareholders for monetary damages for breach of fiduciary duty as a director; except that any such provision shall not limit or eliminate the liability of a director to the corporation or its shareholders for monetary damages for any breach of the director’s duty of loyalty to the corporation or its shareholders, acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, unlawful distributions to shareholders, or any transaction from which the director derived an improper personal benefit. Any such provision in a corporation’s articles of incorporation may not have retroactive effect.

The CBCA provides that no person shall be personally liable for any injury to person or property arising out of a tort committed by an employee unless such person was personally involved in the situation giving rise to the litigation or unless such person committed a criminal offense in connection with such situation.

Articles of Incorporation

The Amended and Restated Articles of Incorporation of the Colorado Corporate Guarantor provides that the Colorado Corporate Guarantor shall indemnify, to the maximum extent permitted by law, any person who is or was a director, officer, agent, fiduciary or employee of the corporation against any claim, liability or expense arising against or incurred by such person made party to a proceeding because he is or was a director, officer, agent, fiduciary or employee of the Colorado Corporate Guarantor or because he is or was serving another entity or an employee benefit plan as a director, officer, partner, trustee, employee, fiduciary or agent at the Colorado Corporate Guarantor’s request. The Colorado Corporate Guarantor shall further have the authority to the maximum extent permitted by law to purchase and maintain insurance providing such indemnification. The right to indemnification shall include the right to be paid or reimbursed by the Colorado Corporate Guarantor reasonable expenses of the type entitled to be indemnified hereunder incurred by a person indemnified hereunder who is, or is threatened to be made, a named defendant or respondent in a proceeding. Such payment or reimbursement may be made in advance of the final disposition of the proceeding and without any determination as to the person’s ultimate entitlement to indemnification, provided that such person delivers to the Colorado Corporate Guarantor a written affirmation of his good faith belief that he has met the standard of conduct necessary for indemnification and a written undertaking, by or on behalf of such person, to repay all amounts so advanced if it shall ultimately be determined that such indemnified person is not entitled to be indemnified. The Colorado Corporate Guarantor may purchase and maintain insurance, at its expense, to protect itself, its sole shareholder and any person entitled to indemnification against any expense, liability, or loss, whether or not the corporation would have the power to indemnify such person against such expense, liability, or loss.

Additionally, no director of the Colorado Corporate Guarantor shall have any personal liability for monetary damages to the corporation or its sole shareholder for breach of his fiduciary duty as a director, except it shall not eliminate or limit the personal liability of a director to the Colorado Corporate Guarantor or its sole shareholder for monetary damages for: (i) any breach of the director’s duty of loyalty to the Colorado Corporate Guarantor or its sole shareholder; (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (iii) voting for or assenting to a distribution in violation of § 7-106-401 of the CBCA or

 

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the articles of incorporation if it is established that the director did not perform his duties in compliance with § 7-108-401 of the CBCA, provided that the personal liability of a director in this circumstance shall be limited to the amount of the distribution which exceeds what could have been distributed without violation of § 7-106-401 of the CBCA or the articles of incorporation; or (iv) any transaction from which the director directly or indirectly derives an improper personal benefit. Nothing contained herein will be construed to deprive any director of his right to all defenses ordinarily available to a director nor will anything herein be construed to deprive any director of any right he may have for contribution from any other director or other person.

Colorado LLC Guarantors

Broadway Mississippi Development, LLC

Gates International Holdings, LLC

(together, the “Colorado LLC Guarantors”)

Colorado Limited Liability Company Act

Pursuant to the Colorado Limited Liability Company Act (the “Colorado LLC Act”), a limited liability company shall reimburse a current or former member or manager for payments made, and indemnify a current or former member or manager for liabilities incurred by the member or manager, in the ordinary course of the business of the limited liability company or for the preservation of its business or property if such payments were made or liabilities incurred without violation of the member’s or manager’s duties to the limited liability company.

Operating Agreement

The Operating Agreement of Broadway Mississippi Development, LLC (“BMD”), whose sole member is the Colorado Corporate Guarantor, provides that to the fullest extent permitted by applicable law, neither the the Colorado Corporate Guarantor nor any officer nor any employee, representative or agent of BMD or the Colorado Corporate Guarantor (each, a “Covered Person”) shall be liable to BMD or any other person that is a party to or is otherwise bound by the Operating Agreement for any loss, damage or claim incurred by reason of any act or omission performed or omitted by such Covered Person in good faith on behalf of BMD and in a manner reasonably believed to be within the scope of the authority conferred on such Covered Person by the Operating Agreement, except that a Covered Person shall be liable for any such loss, damage or claim incurred by reason of such Covered Person’s gross negligence or intentional misconduct.

BMD’s Operating Agreement further provides that to the fullest extent permitted by applicable law, a Covered Person shall be entitled to indemnification from BMD for any loss, damage or claim incurred by such Covered Person by reason of any act or omission performed or omitted by such Covered Person in good faith on behalf of BMD and in a manner reasonably believed to be within the scope of the authority conferred on such Covered Person by the Operating Agreement, except that no Covered Person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by such Covered Person by reason of such Covered Person’s gross negligence or intentional misconduct with respect to such acts or omissions; provided, however, that any indemnity by BMD shall be provided out of and to the extent of BMD’s assets only, and the Colorado Corporate Guarantor shall not have personal liability on account thereof.

BMD’s Operating Agreement also provides that to the fullest extent permitted by applicable law, expenses (including legal fees) incurred by a Covered Person defending any claim, demand, action, suit or proceeding shall, from time to time, be advanced by BMD prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by BMD of an undertaking by or on behalf of the Covered Person to repay such amount if it shall be determined that the Covered Person is not entitled to be indemnified. A Covered Person shall be fully protected in relying in good faith upon the records of BMD and upon such information, opinions, reports or statements presented to BMD by any Person as to matters the Covered Person reasonably believes are within such other Person’s professional or expert competence and who has been selected with reasonable care by or on behalf of BMD, including information, opinions, reports or statements as to the value and amount of the assets, liabilities, or any other facts pertinent to the existence and amount of assets from which distributions to the Colorado Corporate Guarantor might properly be paid.

 

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To the extent that, at law or in equity, a Covered Person has duties (including fiduciary duties) and liabilities relating thereto to BMD or to any other Covered Person, a Covered Person acting under the Operating Agreement shall not be liable to BMD or any other person that is a party to or is otherwise bound by the Operating Agreement for its good faith reliance on the provisions of the Operating Agreement or any approval or authorization granted by BMD or any other Covered Person. The provisions of the Operating Agreement, to the extent that they restrict the duties and liabilities of a Covered Person otherwise existing at law or in equity, are agreed by the Colorado Corporate Guarantor to replace such other duties and liabilities of such Covered Person.

The Operating Declaration of Gates International Holdings, LLC (“GIH”), whose sole member is The Gates Corporation, provides that the member, employees, and agents of GIH shall be entitled to be indemnified by GIH to the extent provided in the Colorado limited Liability Act, as amended from time to time, and shall be entitled to the advance of expenses, including attorney’s fees, in the defense or prosecution of a claim against the Member employee or agent

Delaware Corporate Guarantors

Air System Components, Inc.

Aquatic Co.

Aquatic Trucking Co.

Buffalo Holding Company

Conergics Corporation

Dexter Axle Acquisition Corp.

Dexter Axle Company

Dexter Axle Trucking Company

Epicor Industries, Inc.

Gates Mectrol, Inc.

Hart & Cooley Trucking Company

Hart & Cooley, Inc.

NRG Industries, Inc. (Delaware Entity)

Ruskin Company

Ruskin Service Company

Schrader Electronics, Inc.

Schrader International Holding Co.

Schrader-Bridgeport International, Inc.

Selkirk Corporation

The Gates Corporation

Tomkins Automotive Holding Co.

Tomkins Building Products, Inc.

Tomkins, Inc.

Waltham Real Estate Holding Co.

(together, the “Delaware Corporate Guarantors”)

General Corporation Law of the State of Delaware

Section 145 of the General Corporation Law of the State of Delaware (the “DGCL”) grants corporations the power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful.

 

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In the case of an action by or in the right of the corporation, Section 145 of the DGCL grants corporations the power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.

Section 145 of the DGCL also empowers a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the corporation would have the power to indemnify such person against such liability under Section 145 of the DGCL.

Section 102(b)(7) of the DGCL allows a corporation to eliminate or limit the personal liability of directors to a corporation or its stockholders for monetary damages for a breach of fiduciary duty as a director, except where the director breached his duty of loyalty, failed to act in good faith, engaged in intentional misconduct or knowingly violated a law, authorized the payment of a dividend or approved a stock purchase or redemption in violation of Delaware corporate law or obtained an improper personal benefit.

The Bylaws

The bylaws of each of Air System Components, Inc., Aquatic Co., Aquatic Trucking Co., Dexter Axle Acquisition Corp., Dexter Axle Company, Dexter Axle Trucking Company, Gates Mectrol, Inc., Hart & Cooley Trucking Company, Hart & Cooley, Inc., Ruskin Company, Ruskin Service Company, Schrader Electronics, Inc., Schrader International Holding Co., Selkirk Corporation, Tomkins Automotive Holding Co. and Waltham Real Estate Holding Co. provide that such corporation shall indemnify its present and former directors, officers and employees (and any person acting as a director, officer, employee, fiduciary or agent for another entity at the request of the corporation) against expenses (including attorneys’ fees) and other liabilities and losses actually and reasonably incurred by such person in connection with any suits to which they were or are made or threatened to be made party by reason of their position with the corporation. Each of these corporations may, at its discretion, provide indemnification to agents of the corporation with the same scope and effect as the foregoing indemnification of directors, officers and employees.

The bylaws of each of Buffalo Holding Company, Epicor Industries, Inc. and Schrader-Bridgeport International, Inc. provide that such corporation shall indemnify its present and former directors and officers (and any person acting as a director, officer, employee or agent for another entity at the request of the corporation) against expenses (including attorneys’ fees) and other liabilities and losses actually and reasonably incurred by such person in connection with any suits to which they were or are made or threatened to be made party by reason of their position with the corporation. Schrader-Bridgeport International, Inc. may, at its discretion, provide indemnification to employees and agents of the corporation with the same scope and effect as the foregoing indemnification of directors and officers.

The bylaws of Conergics Corporation provide that such corporation shall indemnify its present and former directors and officers (and any person acting as a director or officer for another entity at the request of the corporation) against expenses (including attorneys’ fees) and other liabilities and losses actually and reasonably incurred by such person in connection with any suits to which they were or are made or threatened to be made party by reason of their position with the corporation.

 

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The bylaws of Tomkins, Inc. provide that such corporation shall indemnify its present and former directors and officers as well as directors and officers who, while a director, officer or employee, is or was acting as a director, officer, employee, agent or trustee for another entity at the request of the corporation against expenses (including attorneys’ fees) and other liabilities and losses actually and reasonably incurred by such person in connection with any suits to which they were or are made or threatened to be made party by reason of their position with the corporation.

The bylaws of Tomkins Building Products, Inc. provide that such corporation shall indemnify its present and former directors, officers, employees and agents (and any person acting as a director, officer, employee or agent for another entity at the request of the corporation) against expenses (including attorneys’ fees) and other liabilities and losses actually and reasonably incurred by such person in connection with any suits to which they were or are made or threatened to be made party by reason of their position with the corporation.

The bylaws of each of Air System Components, Inc., Aquatic Co., Aquatic Trucking Co., Dexter Axle Acquisition Corp., Dexter Axle Company, Dexter Axle Trucking Company, Gates Mectrol, Inc., Hart & Cooley Trucking Company, Hart & Cooley, Inc., Ruskin Company, Ruskin Service Company, Schrader Electronics, Inc., Schrader International Holding Co., Selkirk Corporation, Tomkins Automotive Holding Co., Tomkins, Inc. and Waltham Real Estate Holding Co. also provide that the corporation shall pay expenses (including attorneys’ fees) incurred by an officer or director in any suit in advance of the final disposition of any such suit upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation. Such expenses (including attorneys’ fees) incurred by agents may be so paid upon such terms and conditions, if any, as the corporation deems appropriate.

The bylaws of NRG Industries, Inc. (Delaware Entity) are silent with respect to indemnification. The certificate of incorporation of NRG Industries, Inc. (Delaware Entity) provides that such corporation shall indemnify its present and former directors and officers as well as directors and officers who, while a director, officer or employee, is or was acting as a director, officer, partner, venturer, proprietor, trustee, employee, agent or similar functionary of another entity at the request of the corporation to the fullest extent provided by Delaware law. The certificate of incorporation of NRG Industries, Inc. (Delaware Entity) also provides that the corporation shall pay expenses (including attorneys’ fees) incurred by an officer or director in any suit in advance of the final disposition of any such. NRG Industries, Inc. (Delaware Entity) may additionally provide indemnification to employees and agents of the corporation to the fullest extent provided by Delaware law.

The bylaws of The Gates Corporation are silent with respect to indemnification. The certificate of incorporation of The Gates Corporation provides that such corporation shall indemnify its present and former directors, officers and employees (and any person acting as a director, officer, employee or fiduciary for another entity at the request of the corporation) against expenses (including attorneys’ fees) and other judgments, fines, penalties and amounts paid in settlement actually and reasonably incurred by such person in connection with any suits to which they were or are involved or made or threatened to be made party by reason of their position with the corporation.

Delaware LLC Guarantors

Schrader, LLC

Selkirk IP L.L.C.

Tomkins, LLC

(together, the “Delaware LLC Guarantors”)

Delaware Limited Liability Company Act

Section 18-108 of the Delaware Limited Liability Company Act (the “DLLCA”) provides that, subject to such standards and restrictions, if any, as are set forth in its limited liability company agreement, a limited liability company may, and shall have the power to, indemnify and hold harmless any member or manager or other person from and against any and all claims and demands whatsoever. However, to the extent that the limited liability company agreement seeks to restrict or limit the liabilities of such person, Section 18-1101 of the DLLCA prohibits it from eliminating liability for any act or omission that constitutes a bad faith violation of the implied contractual covenant of good faith and fair dealing.

 

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The limited liability company agreement of Schrader, LLC provides that no member, nor any officer, director, stockholder, employee, representative or agent of a member, nor any manager, officer, employee, representative or agent of Schrader, LLC shall be liable to Schrader, LLC or any other person by reason of the actions or omissions of such person in relation to Schrader, LLC, its limited liability company agreement, any related document or any transaction or investment contemplated thereby, provided such action or omission does not constitute fraud, bad faith, gross negligence or willful misconduct. The limited liability company agreement also provides that Schrader, LLC shall indemnify, hold harmless, and pay all judgments and claims against any such person relating to any liability or damage incurred by any such person by reason of any act performed or omitted to be performed by such person in connection with the management of the affairs of Schrader, LLC or which relates to or arises out of Schrader, LLC or its property, business or affairs, except that no person shall be indemnified from any liability for fraud, bad faith, gross negligence or willful misconduct.

The limited liability company agreement of Selkirk IP L.L.C. provides that no member, nor manager, nor any officer, director, stockholder, partner, employee, affiliate, representative or agent of a member or manager, nor any officer, employee, representative or agent of Selkirk IP L.L.C. shall be liable to Selkirk IP L.L.C. or any other person by reason of the actions or omissions of such person in relation to Selkirk IP L.L.C., its property or the conduct of its business or affairs, its limited liability company agreement, any related document or any transaction or investment contemplated thereby, that was taken or omitted in the reasonable belief that it is in or not contrary to the best interests of Selkirk IP L.L.C. and within the scope of authority granted to that person and does not constitute fraud, bad faith, gross negligence or willful misconduct. The limited liability company agreement also provides that Selkirk IP L.L.C. shall indemnify, hold harmless, and pay all judgments and claims against any such person relating to any liability or damage incurred by any such person by reason of any act performed or omitted to be performed by such person in connection with the management of the affairs of Selkirk IP L.L.C. or which relates to or arises out of Selkirk IP L.L.C. or its property, business or affairs, except that no person shall be indemnified from any liability for (i) any claim with respect to which such person has engaged in fraud, bad faith, gross negligence or willful misconduct, (ii) any claim initiated by such person unless the claim was brought to enforce such person’s right to indemnification or was authorized or consented to by the board of directors.

The limited liability company agreement of Tomkins, LLC provides that no member, nor any officer, director, shareholder, partner, member, employee, affiliate, representative or agent of a member or of Tomkins, LLC, nor any former officer, employee, director or member shall be liable to Tomkins, LLC or its members by reason of the actions or omissions of such person that may cause or result in a loss or damage to Tomkins, LLC or a member, if the action or omission (i) was taken in good faith, in a manner reasonably believed to be within the scope of such person’s authority and in a manner reasonably believed to be in, or not inconsistent with, the best interests of Tomkins, LLC, and (ii) did not constitute fraud, bad faith, gross negligence or willful misconduct. The limited liability company agreement also provides that Tomkins, LLC shall indemnify, hold harmless, and pay all judgments and claims against any such person relating to any act performed or omitted to be performed by such person in connection with the activities of Tomkins, LLC or a subsidiary if (i) the act of failure to act was taken in good faith, within the scope of such person’s authority and in a manner reasonably believed to be in, or not inconsistent with, the best interests of Tomkins, LLC or such subsidiary, and (ii) the conduct did not constitute fraud, gross negligence, willful misconduct or a material breach of a material provision of the limited liability company agreement.

Delaware LP Guarantors

Selkirk Americas, L.P.

Selkirk Canada Holdings, L.P.

Tomkins U.S., L.P.

(together, the “Delaware LP Guarantors”)

 

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Pursuant to Section 17-108 of the Delaware Revised Uniform Limited Partnership Act (the “DRULPA”), a limited partnership may, subject to the standards set forth in the partnership agreement, indemnify and hold harmless any partner or other person from and against any and all claims and demands.

Pursuant to the agreement of limited partnership of Selkirk Americas, L.P. the general partner shall not be liable, responsible or accountable in damages or otherwise to a limited partner for any action or omission on behalf of the partnership taken in good faith within the scope of authority conferred to such person or for any act or omission that was consented to or approved by the limited partner, unless such action or failure to act was performed or omitted fraudulently or constituted gross negligence or willful misconduct. Further, pursuant to such agreement of limited partnership, the partnership shall indemnify each general partner and any of its members, managers, officers, employees or agents who was or is a party or is threatened to be made a party to any action, suit or proceeding, by reason of any acts, omissions, or alleged acts or omissions not taken in bad faith and arising out of such person’s activities as a general partner, or as a member manager, officer, employee or agent of the general partner, on behalf of the partnership or in furtherance of the interest of the partnership, against losses, damages or expenses for which such person has not otherwise been reimbursed actually and reasonably incurred in connection with such action, suit or proceeding, provided such person did not act, in connection with the acts or omissions for which indemnification is sought, fraudulently or in a manner constituting gross negligence or willful misconduct.

Pursuant to the agreement of limited partnership of Selkirk Canada Holdings, L.P., none of its partners, or any officers, directors, members, managers, stockholders, partners, employees, representatives, consultants or agents of any of the partners, nor any officer, employee, representative, consultant or agent of the partnership or any of its affiliates shall have any liability to the partnership or any other person for any act or omission relating to the partnership and the conduct of its business, the partnership agreement, any related document or any transaction contemplated thereby taken or omitted in good faith and in the reasonable belief that such act or omission was in or was not contrary to the best interests of the partnership, provided that such act or omission does not constitute fraud, willful misconduct, bad faith or gross negligence. Further, pursuant to such agreement of limited partnership, each general partner and each limited partner and each officer, director, member or manager of either the general partner or the limited partner shall be indemnified by the partnership to the fullest extent permitted by law against any losses, claims, demands, judgments, fines, settlements, liabilities, expenses and other amounts arising from any and all actions, suits or proceedings, in which such person may be involved, or threatened to be involved, by reason of its management of the affairs of the partnership or which relates to or arises out of the partnership or its property, business or affairs, provided that such person did not engage in fraud, willful misconduct, bad faith or gross negligence with respect to such claim. The partnership may advance to such person any amounts required to defend any claim for which they may be entitled to indemnification if such person promises to repay any amounts advanced by the partnership if it is determined that such person is not entitled to indemnification. The partnership may, at the discretion of its general partner, provide indemnification to any employees, representatives, agents or consultants of the partnership or any of its subsidiaries to the same extent outlined above.

Pursuant to the agreement of limited partnership of Tomkins U.S., L.P., none of the general partner, any affiliate of the general partner, any officer, director or employee of the general partner or such affiliate, nor any member of the partnership management committee shall have any liability to the partnership for any loss, damage, liability or expenses suffered by the partnership or the limited partners by reason of any act, alleged act or omission of such person that was performed in good faith on behalf of the partnership and in a manner reasonably believed by such person to be within the scope of authority granted to such person and in, or not opposed to, the best interests of the partnership, provided that such person is not guilty of gross negligence or willful misconduct. Further, pursuant to such agreement of limited partnership, the partnership shall indemnify each such person listed above, for any claim, demand, loss, damage, liability or expense by reason of any act, alleged act or omission taken in good faith on behalf of the partnership and in a manner reasonably believed by such person to be within the scope of authority granted to such person and in, or not opposed to, the best interests of the partnership, provided that such person is not guilty of gross negligence or willful misconduct. No indemnification shall be provided in connection with any claim or settlement unless such person is successful in defending such action and such indemnification (and the settlement, in the case of a settlement) is approved by a court of law.

 

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Indiana Guarantor

Hytec, Inc.

Indiana Business Corporation Law

The Indiana Business Corporation Law (“IBCL”), the provisions of which govern e Industries, Inc., empowers an Indiana corporation to indemnify present and former directors, officers, employees or agents or any person who may have served at the request of the corporation as a director, officer, employee or agent of another corporation (“Eligible Persons”) against liability incurred in any proceeding, civil or criminal, in which the Eligible Person is made a party by reason of being or having been in any such capacity or arising out of his status as such, if the individual acted in good faith and reasonably believed that (a) the individual was acting in the best interests of the corporation, (b) if the challenged action was taken other than in the individual’s official capacity as an officer, director, employee or agent, the individual’s conduct was at least not opposed to the corporation’s best interests, or (c) if a criminal proceeding, either the individual had reasonable cause to believe his or her conduct was lawful or no reasonable cause to believe his or her conduct was unlawful.

The IBCL further empowers a corporation to pay or reimburse the reasonable expenses incurred by an Eligible Person in connection with the defense of any such claim including counsel fees, and, unless limited by its articles of incorporation, the corporation is required to indemnify an Eligible Person against reasonable expenses if he or she is wholly successful in any such proceeding, on the merits or otherwise. Under certain circumstances, a corporation may pay or reimburse an Eligible Person for reasonable expenses prior to final disposition of the matter. Unless a corporation’s articles of incorporation otherwise provide, an Eligible Person may apply for indemnification to a court which may order indemnification upon a determination that the Eligible Person is entitled to indemnification in view of all the relevant circumstances without regard to whether his or her actions satisfied the appropriate standard of conduct.

Before a corporation may indemnify any Eligible Person against liability or reasonable expenses under the IBCL, a quorum consisting of directors who are not parties to the proceeding must (1) determine that indemnification is permissible in the specific circumstances because an Eligible Person met the requisite standard of conduct, (2) authorize the corporation to indemnify the Eligible Person and (3) if appropriate, evaluate the reasonableness of expenses for which indemnification is sought. If it is not possible to obtain a quorum of uninvolved directors, the foregoing action may be taken by a committee of two or more directors who are not parties to the proceeding, special legal counsel selected by the board of directors or such a committee, or by the shareholders of the corporation.

In addition to the foregoing, the IBCL states that the indemnification it provides shall not be deemed exclusive of any other rights to which those indemnified may be entitled under any provision of the articles of incorporation, bylaws, resolution or other authorization adopted, after notice by a majority vote of all the voting shares then issued and outstanding. The IBCL also empowers an Indiana corporation to purchase and maintain insurance on behalf of any Eligible Person against any liability asserted against or incurred by him or her in any capacity as such, or arising out of his or her status as such, whether or not the corporation would have had the power to indemnify him or her against such liability.

By-Laws

The By-Laws of the Indiana Guarantor contain provisions under which the officers and directors of the Indiana Guarantor are entitled to indemnification as a matter of right against expenses reasonably incurred by any such person in connection with the defense of any action, suit or proceeding, civil or criminal, in which such person is made or threatened to be made, a party, by reason of being or having been in any such capacity, or arising out of his status as such, except in relation to matters as to which he is adjudged in such action to be liable for negligence or misconduct in the performance of duty to the Indiana Guarantor.

Kentucky Guarantor

Koch Filter Corporation

 

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Kentucky Revised Statutes

Section 271B.8-510 of the Kentucky Revised Statutes (“KRS”) provides that a corporation may indemnify an individual made a party to a proceeding because he is or was a director against liability incurred in the proceeding if: (a) he conducted himself in good faith; and (b) he reasonably believed (1) in the case of conduct in his official capacity with the corporation, that his conduct was in its best interests and (2) in all other cases, that his conduct was at least not opposed to its best interests; and (c) in the case of any criminal proceeding, he had no reasonable cause to believe his conduct was unlawful. A corporation may not indemnify a director under KRS 271B.8-510: (a) in connection with a proceeding by or in the right of the corporation in which the director was adjudged liable to the corporation; or (b) in connection with any other proceeding charging improper personal benefit to him, whether or not involving action in his official capacity, in which he was adjudged liable on the basis that personal benefit was improperly received by him. Indemnification permitted under KRS 271B.8-510 in connection with a proceeding by or in the right of the corporation is limited to reasonable expenses incurred in connection with the proceeding.

A corporation may not indemnify a director under KRS 271B.8-510 unless authorized in the specific case after a determination has been made that indemnification of the director is permissible in the circumstances because he has met the standard of conduct set forth in KRS 271B.8-510. The determination is made by the board of directors by majority vote of a quorum consisting of directors not at the time parties to the proceeding; or if a quorum cannot be obtained, by majority vote of a committee duly designated by the board of directors consisting solely of two or more directors not at the time parties to the proceeding; or by special legal counsel selected by the board of directors or its committee in the manner prescribed above, or if a quorum or committee is not obtainable or cannot be designated, by majority vote of the full board of directors; or by the shareholders, but shares owned or controlled by directors who at the time were parties to the proceeding cannot be voted.

Under KRS 271B.8-530 a corporation may pay for or reimburse the reasonable expenses incurred by a director who is a party to a proceeding in advance of final disposition of the proceeding if (i) the director furnishes the corporation a written affirmation of his good faith belief that he has met the standard of conduct required for indemnification, (ii) the director furnishes the corporation a written personal undertaking to repay the advance if it is ultimately determined that he did not meet the standard of conduct, and (iii) the corporation determines that the facts then known to those making the determination will not preclude indemnification.

Unless limited by the articles of incorporation, a director who has been wholly successful, on the merits or otherwise, in the defense of any proceeding to which he was a party because he is or was a director of the corporation is entitled to indemnification against reasonable expenses incurred by him in connection with the proceeding. Unless limited by its articles of incorporation, a corporation may indemnify and advance expenses to an officer, employee or agent of the corporation to the same extent as it may to a director. The indemnification and advancement of expenses provided by or granted pursuant to KRS 271B.8-500 to 271B.8-580 is not exclusive of any other rights to which those seeking indemnification or advancement of expenses may otherwise be entitled.

By-Laws

Article X of the Restated and Amended Bylaws of the Kentucky Guarantor provides that the corporation shall indemnify each of its directors and officers who is made a party to a proceeding in accordance with KRS 271B.8-500 to 271B.8-580, and that all reasonable expenses incurred by a director or officer who is made a party to a proceeding may be reimbursed by the corporation or paid in advance in accordance with KRS 271B.8-500 to 271B.8-580.

Michigan Guarantor

Dexter Chassis Group, Inc.

 

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Michigan Business Corporation Act

The Michigan Guarantor is organized under the Michigan Business Corporation Act (the “MBCA”) which, in general, empowers Michigan corporations to indemnify a person who was or is a party or is threatened to be made a party to a threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative and whether formal or informal, other than an action by or in the right of the corporation, by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, partner, trustee, employee or agent of another enterprise, against expenses, including attorney’s fees, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred in connection therewith if the person acted in good faith and in a manner reasonably believed to be in or not opposed to the best interests of the corporation or its shareholders and, with respect to a criminal action or proceeding, if the person had no reasonable cause to believe his or her conduct was unlawful.

The MBCA also empowers Michigan corporations to provide similar indemnity to such a person for expenses, including attorney’s fees, and amounts paid in settlement actually and reasonably incurred by the person in connection with actions or suits by or in the right of the corporation if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the interests of the corporation or its shareholders, except in respect of any claim, issue or matter in which the person has been found liable to the corporation, unless the court determines that the person is fairly and reasonably entitled to indemnification in view of all relevant circumstances, in which case indemnification is limited to reasonable expenses incurred. If a person is successful in defending against a derivative action or third-party action, the MBCA requires that a Michigan corporation indemnify the person against expenses incurred in the action.

Bylaws

The Michigan Guarantor’s bylaws generally require the Michigan Guarantor to indemnify officers, directors and employees to the fullest extent legally possible under the MBCA and provide that similar indemnification may be afforded employees and agents. In addition, the bylaws require the Michigan Guarantor to indemnify any person who is or was serving at the request of the Michigan Guarantor as a director, officer, employee, fiduciary or agent of another entity to the same degree as the foregoing indemnification of directors and officers. The Michigan Guarantor’s bylaws further provide for the advancement of litigation expenses under certain circumstances.

Ohio Guarantors

Eastern Sheet Metal, Inc.

FBN Transportation, Inc.

Tomkins Industries, Inc.

(together, the “Ohio Guarantors”)

Ohio Revised Code

Section 1701.13(E)(1) of the Ohio Revised Code (“O.R.C.”) provides that a corporation may indemnify any person who was or is a party, or threatened to be made a party, to any action, suit or proceeding, other than an action by or in the right of the corporation, by reason of the fact he is or was a director, officer, employee or agent of the corporation, or was serving at the request of the corporation as a director, officer employee, agent or other capacity of another entity, against expenses, including attorney’s fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if (i) he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation and (ii) with respect to any criminal action or proceeding, he had no reasonable cause to believe his conduct was unlawful.

Section 1701.13(E)(2) of the O.R.C. provides that if the action or suit is by or in the right of the corporation, the corporation may indemnify a director, officer, employee or agent against expenses, including attorney’s fees, actually and reasonably incurred by him in connection with the defense or settlement of such suit or

 

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action if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification may be made in respect of any of the following: (i) any matter as to which such person is adjudged to be liable for negligence or misconduct in the performance of his duty to the corporation unless a court determines that such person is fairly and reasonably entitled to indemnification for such expenses or (ii) any action or suit in which the only liability asserted against a director is an unlawful loan, dividend or distribution of assets or purchase or redemption of shares pursuant to O.R.C. §1701.95.

Any indemnification under O.R.C. §1701.13(E), unless ordered by a court, may be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because he met the applicable standard of conduct. Such determination is made by a majority vote of a quorum of directors not parties to or threatened with the action; or if such a quorum is not obtainable, or if a majority vote of a quorum of disinterested directors so directs, in a written opinion by independent legal counsel; or by the shareholders; or by the court in which such action was brought.

Expenses, including attorney’s fees, incurred by a director, officer, employee or agent in defending any action may be paid by the corporation as they are incurred, in advance of final disposition of the action, as authorized by the directors in the specific case, upon receipt of an undertaking by such person to repay such amount if it ultimately is determined that he is not entitled to be indemnified by the corporation. Unless the articles or regulations specifically state that the provisions of Section 1701.13(E)(5) of the O.R.C. do not apply and unless the only liability asserted is pursuant to O.R.C. §1701.95, a corporation is required to advance payment of a director’s expenses in defending the action upon receipt of an undertaking by the director to (i) repay such amount if it is proved by clear and convincing evidence in court that his action or failure to act was undertaken with deliberate intent to cause injury to the corporation or with reckless disregard for its best interests and (ii) reasonably cooperate with the corporation concerning the action.

To the extent a director, officer, employee or agent has been successful on the merits or otherwise in defense of any action, suit or proceeding, he is entitled to be indemnified against expenses, including attorney’s fees, actually and reasonably incurred by him in connection with such proceeding. The indemnification authorized by O.R.C. §1701.13(E) is not exclusive of, and is in addition to, any other rights granted to those seeking indemnification under the articles, the regulations, any agreement, vote of shareholders or disinterested directors, or otherwise.

By-Laws and Regulations

Article VIII of the By-Laws of Eastern Sheet Metal, Inc. and FBN Transportation, Inc. provides that each person who was or is made or threatened to be made a party to or is involved in any action, suit or proceeding by reason of the fact that he is or was a director, officer or employee of the corporation or serving at the request of the corporation as a director, officer, employee, fiduciary or agent of another entity shall be indemnified and held harmless by the corporation to the fullest extent not prohibited by the General Corporation Law of the State of Ohio against all expenses, liability, loss (including attorneys’ fees actually and reasonably incurred by such person in connection with such proceeding), judgments, fines and amounts paid in settlement. Expenses incurred by any such person in defending a proceeding shall be paid by the corporation in advance of final disposition of such proceeding upon receipt of an undertaking by the director, officer or employee to repay such amount if it is ultimately determined that he is not entitled to be indemnified by the corporation. The rights to indemnification and payment of expenses in advance of final disposition in Article VIII are deemed to be a contract right between the corporation and such director, officer or employee who serves in any such capacity while Article VIII and the relevant provisions of the General Corporation Law of the State of Ohio are in effect.

Article Five of the Regulations of Tomkins Industries, Inc. provides that the corporation shall indemnify, to the full extent then permitted by law, any person who was or is or threatened to be made a party to any action, suit or proceeding by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or serving at the request of the corporation as a director, officer, employee or agent of another entity. The board of directors, whether a disinterested quorum exists or not, may advance to any individual who may be entitled to indemnification under Article Five an amount sufficient to pay expenses incurred by the individual with respect to any such claim, action, suit or proceeding. Before the corporation may make such advance, the individual must agree in writing to repay the amount advanced less the amount of indemnification, if any, which the board of directors ultimately authorizes to be paid to the individual.

 

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Tennessee Guarantor

Ideal Clamp Products, Inc.

Tennessee Code Annotated

The Tennessee Guarantor is a corporation organized under the laws of the State of Tennessee. Sections 48-18-501 through 48-18-509 of the Tennessee Code Annotated (“T.C.A.”) authorize a corporation to provide for the indemnification of officers, directors, employees and agents in terms sufficiently broad to permit indemnification under certain circumstances for liabilities (including reimbursement for expenses incurred) arising under the Securities Act. The Tennessee Guarantor is subject to the indemnification provisions set forth in those statutes.

T.C.A. Sections 48-18-503 and 48-18-507 require a corporation to indemnify a director or officer, who is successful in defending any proceeding brought against him as a result of his role as director or officer of the corporation, whichever is applicable. The corporation must reimburse the director or officer for reasonable expenses incurred by the director in connection with the proceeding.

Amended and Restated Charter

T.C.A. Section 48-12-102, permits the inclusion in the charter of a Tennessee corporation of a provision, with certain exceptions, eliminating the personal monetary liability of directors to the corporation or its shareholders for breach of the duty of care. The Tennessee Guarantor has adopted the provisions of the statute as Article VIII of its amended and restated charter effective September 8, 1997.

Washington Guarantor

Hytec, Inc.

Revised Code of Washington

Title 23B of the Revised Code of Washington (the “Washington Business Corporation Act”), provides that a corporation may indemnify an individual made a party to a proceeding because the individual is or was a director or officer of the corporation, against liability incurred in the proceeding, if (a) the individual acted in good faith, and (b) the individual reasonably believed that (i) in a case involving conduct in the individual’s official capacity with the corporation, that such conduct was in the corporation’s best interests, and (ii) in all other cases, that the individual’s conduct was at least not opposed to the corporation’s best interests, and (c) in the case of any criminal proceeding, the individual had no reasonable cause to believe that the individual’s conduct was unlawful. A proceeding that is terminated by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent is not, without more, determinative that the director or officer did not meet the standard of conduct required for indemnification. A corporation may not indemnify a director or officer (a) in connection with a proceeding by or in the right of the corporation in which the director or officer was adjudged liable to the corporation, or (b) in connection with any other proceeding which charges improper personal benefit to the director or officer in which the director or officer was adjudged liable on the basis that such director or officer improperly received personal benefit.

 

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Unless limited by its articles of incorporation, the Washington Business Corporation Act requires a corporation to indemnify a director or officer against reasonable expenses incurred in connection with a proceeding to which the director or officer was made a party because of such person’s status as a director or officer and in which the director or officer was wholly successful on the merits. If authorized by its articles of incorporation, bylaws, resolution adopted by the board of directors or shareholders, or by contract, a corporation may pay for or reimburse reasonable expenses incurred by a director or officer in advance of a final disposition of the proceeding if the director or officer provides a written affirmation of the director’s or officer’s good faith belief that the director or officer has met the applicable standards of conduct described above, and provides the corporation with a written, unlimited personal guaranty to repay the advance if it is determined that the director or officer did not meet such standards of conduct.

Unless a corporation’s articles of incorporation provide otherwise, a director or officer may also apply to the court conducting the proceeding or any other court of competent jurisdiction for court-ordered indemnification or advancement of expenses. The court may order such indemnification or advancement of expenses if it determines the director or officer (a) is entitled to mandatory indemnification, (b) is fairly and reasonably entitled to indemnification in view of the relevant circumstances, regardless of whether the director or officer met the applicable standards of conduct described above or was adjudged liable to the corporation, provided that if the director or officer was adjudged liable, indemnification is limited to reasonable expenses incurred unless otherwise provided by the corporation’s articles of incorporation, bylaws, contract or a resolution approved or ratified by the shareholders, or (c) the corporation’s articles of incorporation, bylaws, or any applicable resolution or contract entitle the director or officer to payment or reimbursement of reasonable expenses incurred in advance of final disposition of the proceeding. Furthermore, if authorized by the corporation’s articles of incorporation, a bylaw adopted or ratified by the shareholders, or a resolution adopted or ratified by the shareholders, a corporation may indemnify a director or officer or obligate itself to reimburse expenses incurred by a director or officer without regard to the limitations set forth in the Washington Business Corporation Act, provided that a director or officer shall not be indemnified from or on account of (a) acts or omissions finally adjudged to be intentional misconduct or a knowing violation of law, (b) conduct of a director finally adjudged to have constituted an unlawful distribution, or (c) any transaction with respect to which it was finally adjudged that the director or officer received a benefit in money, property or services to which the director or officer was not legally entitled.

Decisions to indemnify must be made for each specific case after a determination has been made that the applicable standard of conduct has been met, and the Washington Business Corporation Act sets forth certain requirements for making such determination. A corporation must provide shareholders with notice of any indemnification or advance of expenses in the form of a notice delivered with or prior to the notice of the next shareholders’ meeting. Additionally, under the Washington Business Corporation Act, a corporation may purchase and maintain insurance on behalf of a director or officer or who, while a director, officer, employee or agent of the corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee or agent of another foreign or domestic entity, against liability asserted against or incurred by the individual in that capacity or arising from the status as a director, officer, employee or agent.

Articles of Incorporation and By-Laws

The Articles of Incorporation, as amended, and the By-Laws of Hytec, Inc. do not contain any provisions regarding indemnification or advancement of expenses.

Australian Guarantor

Gates Engineering & Services Australia Pty Ltd.

 

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Corporations Act 2001 (Commonwealth)

Section 199A

Section 199A(1) of the Corporations Act 2001 (Commonwealth) (the “Corporations Act”) provides that a company or a related body corporate must not exempt a person (whether directly or through an interposed entity) from a liability to the company incurred as an officer of the company.

Section 199A(2) of the Corporations Act provides that a company or a related body corporate must not indemnify a person (whether by agreement or by making a payment and whether directly or through an interposed entity) against any of the following liabilities incurred as an officer of the company:

 

  •  

a liability owed to the company or a related body corporate;

 

  •  

a liability for a pecuniary penalty order under section 1317G or a compensation order under sections 1317H, 1317HA or 1317HB of the Corporations Act; or

 

  •  

a liability that is owed to someone other than the company or a related body corporate and did not arise out of conduct in good faith.

Section 199A(2) of the Corporations Act does not apply to a liability for legal costs. By implication, indemnification (as opposed to exemption) which falls outside this provision could be permissible. Therefore, the company may not be prevented from indemnifying an officer against liability to outsiders of the company provided that the officer’s conduct does not involve a lack of good faith.

Section 199A(3) of the Corporations Act provides that a company or a related body corporate must not indemnify a person (whether by agreement or by making a payment and whether directly or through an interposed entity) against legal costs incurred in defending an action for a liability incurred as an officer of the company if the costs are incurred:

 

  •  

in defending or resisting proceedings in which the person is found to have a liability for which they could not be indemnified under section 199A(2) of the Corporations Act;

 

  •  

in defending or resisting criminal proceedings in which the person is found guilty;

 

  •  

in defending or resisting proceedings brought by the Australian Securities and Investments Commission (“ASIC”) (this includes proceedings under section 206C, 206D, 206E or 206EAA, section 232 (oppression), section 1317E, 1317G, 1317H, 1317HA or 1317HB or section 1324) or a liquidator for a court order if the grounds for making the order are found by the court to have been established (but this does not apply to costs incurred in responding to actions taken by ASIC or a liquidator as part of an investigation before commencing proceedings for the court order); or

 

  •  

in connection with proceedings for relief to the person under the Corporations Act in which the court denies the relief.

Section 199B

Section 199B of the Corporations Act provides that a company or a related body corporate must not pay, or agree to pay, whether directly or through any interposed entity a premium for a contract insuring a person who is or has been an officer of the company against a liability (other than one for legal costs) arising out of:

 

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conduct involving a wilful breach of any duty in relation to the company; or

 

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  •  

a contravention of section 182 or 183 of the Corporations Act, which deals with the officer’s duties under the Corporations Act not to improperly use their position or make improper use of information obtained as an officer.

Consequences For Contravention of Section 199A or 199B

Section 199C of the Corporations Act provides that sections 199A and 199B do not authorise anything that would otherwise be unlawful. Furthermore, anything that purports to indemnify or insure a person against a liability or exempt them from a liability will be void to the extent that it contravenes section 199A or 199B of the Corporations Act.

For the purpose of sections 199A and 199B of the Corporations Act, an “officer” of a company as defined in section 9 of the Corporations Act includes, but is not limited to:

 

  •  

a director or secretary;

 

  •  

a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business of the company;

 

  •  

a person who has the capacity to affect significantly the company’s financial standing; or

 

  •  

a person in accordance with whose instructions or wishes the directors of the company are accustomed to act (excluding advice given by the person in the proper performance of functions attaching to the person‘s professional capacity or their business relationship with the directors or the corporation).

Constitution

Clause 94.1 of the constitution of the Australian Guarantor requires the Australian Guarantor to indemnify, to the extent permitted by law and subject to the restrictions in section 199A of the Corporations Act, every person who is or has been an officer of the Australian Guarantor against:

 

  •  

any liability (other than a liability for legal costs); or

 

  •  

reasonable legal costs incurred in defending an action for a liability,

incurred by that person as an officer of the Australian Guarantor or subsidiary.

Pursuant to clause 94.2 of the constitution, the amount of any indemnity payable under clause 94.1 will include an additional amount (“GST Amount”) equal to any Australian Goods and Services Tax (“GST”) payable by the officer being indemnified (“Indemnified Officer”) in connection with the indemnity (less the amount of any input tax credit claimable by the Indemnified Officer in connection with the indemnity). Payment of any indemnity which includes a GST Amount is conditional upon the Indemnified Officer providing the Australian Guarantor with a GST tax invoice for the GST Amount.

For the purposes of clause 94 of the constitution, “officer” means a director of the Australian Guarantor or a secretary of the Australian Guarantor.

Belgium Guarantor

Gates Power Transmission Europe BVBA

 

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Under Belgian law, the directors of a company may be liable for damages to the company in case of improper performance of their duties. The directors of the Belgian Guarantor may be liable to the Belgian Guarantor and to third parties for infringement of the Belgian Guarantor’s articles of association, the Belgian company code or provisions of Belgian law. Under certain circumstances, directors may be criminally liable.

Under Tomkins Limited’s master Directors and Officers Insurance Policy and subject to the terms and conditions thereof, the directors of Belgian Guarantor are insured and may be indemnified in relation to liability they may incur in their capacity as such.

Brazilian Guarantor

Schrader International Brasil Ltda.

The Brazilian Guarantor is organized as a sociedade limitada, and is governed by articles 1052 through 1087 of Law 10406/02, as amended (the “Brazilian Civil Code”). Its corporate capital is held by Tomkins Automotive Company S.À.R.L. and Tomkins Investments Company S.À.R.L. (collectively, the “Partners”). A partners’ liability is limited to the subscribed and unpaid capital of the sociedade limitada.

In general, the liability of each partner of a sociedade limitada is limited to the value of the quotas held by such partner and when the company’s corporate capital has not been fully paid up, the liability of each partner is limited to the amount required to fully pay up its corporate capital. It is important to stress that all partners will be held jointly and severally liable for payment of the company’s capital. However, the Civil Code expressly establishes three exceptions to the rule on limitation of liability, namely:

 

  (i) personal and unlimited liability of the partner who takes part in a resolution on a transaction in which he/she has a conflict of interest with the company that is passed on account of the partner’s vote (article 1,010, paragraph 3, of the Civil Code);

 

  (ii) unlimited liability of all partners that approve any resolution in violation of or contrary to the provisions of the law or of the company’s articles of association (article 1,080 of the Civil Code); and

 

  (iii) liability of the partner acting as a senior officer.

In addition to the three exceptions expressly established in the Civil Code in connection with limitation of liability, there are other exceptions established in specific laws and those arising from well-established case laws, especially regarding tax, labor and social security debts, when partners of sociedades limitadas could be held jointly and severally liable for their payments.

Neither the Brazilian Civil Code, nor the Articles of Association (Contrato Social) of the Brazilian Guarantor include specific indemnification provisions with respect to the officers or partners of the Brazilian Guarantor.

British Virgin Islands (“BVI”) Guarantors

Gates Engineering & Services Limited

Gates Fleximak Limited

(together, the “BVI Guarantors”)

BVI Business Companies Act 2004

Under section 132 of the BVI Business Companies Act 2004 a company incorporated in the British Virgin Islands may, subject to its memorandum or articles of association, indemnify its directors in respect of expenses, and liabilities reasonably incurred in connection with legal, administrative or investigative proceedings, provided that the relevant director acted honestly and in good faith and in what he believed to be the best interests of the company and, in the case of criminal proceedings, provided he had no reason to believe his conduct was unlawful.

 

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The power granted under section 132 is exclusive of any other rights which the relevant person may be entitled to under any agreement, or resolution of shareholders, disinterested directors or otherwise.

Under section 133 a BVI company may also purchase insurance in relation to its directors, whether or not the company has or would have had the power to indemnify the director under section 132.

Memorandum and Articles of Association

Under the Memorandum and Articles of Association of each of the BVI Guarantors, each company may indemnify its directors to the same extent as permitted under section 132 and purchase insurance as permitted by section 133.]

Canadian Guarantor

Ruskin Company Canada Inc.

Canadian Business Corporations Act

Under the Canada Business Corporations Act (“CBCA”), Ruskin Company Canada Inc. (“Ruskin Canada”) may indemnify a present or former director or officer or an individual who acts or acted at Ruskin Canada’s request as a director or officer, or an individual acting in a similar capacity, of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in which the individual is involved because of that association with Ruskin Canada or other entity, provided that the director or officer acted honestly and in good faith with a view to the best interests of Ruskin Canada and, in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, had reasonable grounds for believing that the individual’s conduct was lawful. Such indemnification may be made in connection with a derivative action only with court approval. A director or officer is entitled to indemnification from Ruskin Canada as a matter of right if the individual was not judged by a court or other competent authority to have committed any fault or omitted to do anything that the individual ought to have done and fulfilled the conditions set forth above.

By-Laws

As required or permitted by the CBCA, the By-laws of Ruskin Canada indemnify a director or officer, a former director or officer, or a person who acts or acted at Ruskin Canada’s request as a director or officer of a corporation in which Ruskin Canada is or was a shareholder or creditor and his heirs and legal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of Ruskin Canada or such corporation if he acted honestly and in good faith with a view to the best interests of Ruskin Canada, and, in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful.

Ontario Guarantors

ACD Tridon Inc.

Tomkins Automotive Canada Limited

(together, the “Ontario Guarantors”)

 

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Business Corporations Act (Ontario)

Under the Business Corporations Act (Ontario) (the “OBCA”), each of the Ontario Guarantors may indemnify a present or former director or officer or an individual who acts or acted at the applicable Ontario Guarantor’s request as a director or officer, or an individual acting in a similar capacity, of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in which the individual is involved because of that association with the applicable Ontario Guarantor or other entity, provided that the director or officer acted honestly and in good faith with a view to the best interests of the applicable Ontario Guarantor and, in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, had reasonable grounds for believing that the individual’s conduct was lawful. Such indemnification may be made in connection with a derivative action only with court approval. A director or officer is entitled to indemnification from the applicable Ontario Guarantor as a matter of right if the individual was not judged by a court or other competent authority to have committed any fault or omitted to do anything that the individual ought to have done and fulfilled the conditions set forth above.

By-Laws

As required or permitted by the OBCA, the By-laws of ACD Tridon Inc. (“ACD Tridon”) indemnify a director or officer, a former director or officer, or a person who acts or acted at ACD Tridon’s request as a director or officer of a corporation in which ACD Tridon is or was a shareholder or creditor and his heirs and legal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of ACD Tridon or such corporation if he acted honestly and in good faith with a view to the best interests of ACD Tridon, and, in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful.

The By-laws of Tomkins Automotive Canada Limited (“Tomkins Canada”) indemnify a director or officer, a former director or officer, or a person who acts or acted at Tomkins Canada’s request as a director or officer of a corporation in which Tomkins Canada is or was a shareholder or creditor and his heirs and legal representatives to the extent permitted by the OBCA. In accordance with the OBCA and subject to the foregoing, Tomkins Canada may from time to time indemnify and save harmless any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in right of Tomkins Canada) by reason of the fact that he or she is or was an employee or agent of Tomkins Canada, or is or was serving at the request of Tomkins Canada as a director, officer, employee, agent of or participant in another body corporate, partnership, trust, joint venture or unincorporated association or organization, against expenses (including legal fees), judgments, fines and any amount actually and reasonably incurred by him or her in connection with such action, suit or proceeding if he or she acted honestly and in good faith with a view to the best interests of Tomkins Canada or, as the case may be, to the best interests of the other entity for which he or she served at Tomkins Canada’s request and, with respect to any criminal or administrative action or proceeding that is enforced by a monetary penalty, had reasonable grounds for believing that his or her conduct was lawful.

English Guarantors

ACD Tridon (Holdings) Limited

Air System Components Investments China Ltd

 

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Beta Naco Limited

British Industrial Valve Company Limited

Gates Auto Parts Holdings China Limited

Gates Engineering & Services UK Holdings Ltd.

Gates Fluid Power Technologies Investments Ltd

Gates Holdings Limited

Gates PowerTrain UK Limited

H Heaton Limited

Olympus (Ormskirk) Limited

Ruskin Air Management Limited

Shiitake Limited

Stackpole Investments Limited

Swindon Silicon Systems Limited

Tomkins Engineering Limited

Tomkins Finance Limited (formerly Tomkins Finance plc)

Tomkins Finance Luxembourg Limited

Tomkins Funding Limited

Tomkins Ideal Clamps (Suzhou) Investments Limited

Tomkins Investments China Limited

Tomkins Investments Limited

Tomkins Limited (formerly Tomkins plc)

Tomkins Overseas Company

Tomkins Overseas Investments Limited

Tomkins Pension Services Limited

Tomkins SC1 Limited

Tomkins Sterling Company

Tomkins Treasury (Canadian Dollar) Limited

Tomkins Treasury (Dollar) Company

Tomkins Treasury (Euro) Company)

Trico Products (Dunstable) Limited

Willer & Riley Limited

(together, the “English Guarantors”)

General

As companies incorporated in England and Wales, the English Guarantors are subject to, as applicable, the Companies Act 1929 (the “CA 1929”), the Companies Act 1949 (the “CA 1948”), the Companies Act 1985 (the “CA 1985”) and the Companies Act 2006 (the “CA 2006”). In addition to the provisions set out below, please also refer to Chapter 7 (Directors’ Liabilities) of the CA 2006 set out below at Chapter 7 of the Companies Act 2006.

The articles of association of each of the English Guarantors (except for British Industrial Valve Company Limited) provide that, subject, where applicable, to the provisions of the relevant Companies Act, each of their respective directors and officers shall be indemnified out of the assets of the relevant company against all losses or liabilities incurred by them in the execution of their duties of office or otherwise relating to their office, including liabilities incurred by them in defending any proceedings, whether civil or criminal, in which judgment is given in their favour, or in which they are acquitted or in connection with any application in which relief is granted to them by the court. This statement is a summary of the indemnity provisions set out in articles of association of each of the English Guarantors (which are set out in greater detail below).

The articles of association of Air System Components Investments China Ltd, Gates Auto Parts Holdings China Limited, Gates Engineering & Services UK Holdings ltd., Gates Fluid Power Technologies Investments Ltd, Gates Holdings Limited, Gates PowerTrain UK Limited H Heaton Limited, Olympus (Ormskirk) Limited, Stackpole Investments Limited, Tomkins Engineering Limited, Tomkins Finance Limited, Tomkins Finance Luxembourg Limited, Tomkins Ideal Clamps (Suzhou) Investments Limited, Tomkins Investments China Limited, Tomkins Limited, Tomkins Overseas Company, Tomkins Sterling Company, Tomkins Treasury (Canadian Dollar) Company,

 

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Tomkins Treasury (Dollar) Company, and Tomkins Treasury (Euro) Company also provide that such companies may purchase and maintain insurance for any of their directors against any liability. This statement is a summary of the insurance provision as set out in articles of association of the applicable English Guarantors (which are set out in greater detail below).

ACD Tridon (Holdings) Limited and Trico Products (Dunstable) Limited

Article 33 (Indemnity) of the articles of association of ACD Tridon (Holdings) Limited and Trico Products (Dunstable) Limited provides as follows:

“Subject to the provisions of the Companies Act 1985 but without affecting any indemnity to which a director may otherwise be entitled:

 

(a) no director or other officer of the Company shall be liable for any loss, damage or misfortune which may happen to or be incurred by the Company in consequence of the execution of the duties of his office or in relation thereto; and

 

(b) every director or other officer of the Company shall be indemnified out of the assets of the Company against any losses or liabilities incurred by him:

 

  (i) in defending any civil or criminal proceedings in which he is acquired or judgment is given in his favour; and

 

  (ii) in connection with any application in which relief is granted to him by the Court from liability for negligence, default, breach of duty or breach of trust in relation to the affairs of the Company; and

 

  (iii) in or about the execution of the duties of his office or otherwise in relation thereto.”

Air System Components Investments China Ltd, Gates Auto Parts Holdings China Limited, Gates Fluid Power Technologies Investments Ltd, Stackpole Investments Limited, Tomkins Finance Luxembourg Limited, Tomkins Ideal Clamps (Suzhou) Investments Limited and Tomkins Investments China Limited

Article 25 (Indemnity) of the articles of association of Air System Components Investments China Ltd, Gates Auto Parts Holdings China Limited, Gates Fluid Power Technologies Investments Ltd, Stackpole Investments Limited, Tomkins Finance Luxembourg Limited, Tomkins Ideal Clamps (Suzhou) Investments Limited and Tomkins Investments China Limited provides as follows:

“Regulation 118 of Table A shall not apply to the company.

Subject to the provisions of the Companies Act 1985, the company may purchase and maintain for any director or officer or employee or agent of the company insurance against any liability.

Subject to the Companies Act 1985, but without prejudice to any indemnity to which the person concerned may otherwise be entitled, every person who is or has been a director or other officer or employee of the company shall (to the extent the proceeds of any insurance policy against such liability are insufficient to meet such liability in full) be indemnified out of the assets of the company against all losses or liabilities which he may sustain or incur in or about the execution of the duties of his office or otherwise in relation thereto, including any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgement is given in his favour or in which he is acquitted or in connection with any application under Sections 144 or 727 of the Companies Act 1985, in which relief is granted to him by the court, and no director or other officer shall be liable for any loss, damage or misfortune which may happen to or be incurred by the company in the execution of the duties of his office or in relation thereto.

If the board of directors of the company thinks fit, every agent of the company may be so indemnified against any liability incurred by him in defending any such proceedings.”

 

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H Heaton Limited and Olympus (Ormskirk) Limited

Article 21 (Indemnity) of the articles of association of H Heaton Limited and Olympus (Ormskirk) Limited provides as follows:

“Regulation 118 of Table A shall not apply to the company.

Subject to the provisions of the Companies Act 1985, the company may purchase and maintain for any director or officer or auditor of the company insurance against any liability.

Subject to the Companies Act 1985, but without prejudice to any indemnity to which the person concerned may otherwise be entitled, every person who is or has been a director or other officer of the company shall be indemnified out of the assets of the company against all losses or liabilities which he may sustain or incur in or about the execution of the duties of his office or otherwise in relation thereto, including any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgement is given in his favour or in which he is acquitted or in connection with any application under Sections 144 or 727 of the Companies Act 1985, in which relief is granted to him by the court, and no director or other officer shall be liable for any loss, damage or misfortune which may happen to or be incurred by the company in the execution of the duties of his office or in relation thereto.”

Gates Holdings Limited, Tomkins Engineering Limited, Tomkins Overseas Company, Tomkins Sterling Company, Tomkins Treasury (Canadian Dollar) Company, Tomkins Treasury (Dollar) Company and Tomkins Treasury (Euro) Company

Article 24 (Indemnity) of the articles of association of Gates Holdings Limited, Article 23 (Indemnity) of the articles of association of Tomkins Engineering Limited, Article 30 (Indemnity) of the articles of association of Tomkins Overseas Company and Article 29 of the articles of association of each of Tomkins Sterling Company, Tomkins Treasury (Canadian Dollar) Company, Tomkins Treasury (Dollar) Company and Tomkins Treasury (Euro) Company provide as follows:

“Regulation 118 of Table A shall not apply to the Company.

Subject to the provisions of the Companies Act 1985, the Company may purchase and maintain for any director or officer or employee or agent or auditor of the Company insurance against any liability.

Subject to the Companies Act 1985, but without prejudice to any indemnity to which the person concerned may otherwise be entitled, every person who is or has been a director or other officer or employee of the Company shall (to the extent the proceeds of any insurance policy against such liability are insufficient to meet such liability in full) be indemnified out of the assets of the Company against all losses or liabilities which he may sustain or incur in or about the execution of the duties of his office or otherwise in relation thereto, including any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgement is given in his favour or in which he is acquitted or in connection with any application under Sections 144 or 727 of the Companies Act 1985, in which relief is granted to him by the court, and no director or other officer shall be liable for any loss, damage or misfortune which may happen to or be incurred by the Company in the execution of the duties of his office or in relation thereto.

If the board of directors of the Company thinks fit, every agent and the auditor of the Company may be so indemnified against any liability incurred by him in defending any such proceedings.”

Tomkins Finance Limited (formerly Tomkins Finance plc)

Article 161 (Indemnity) of the articles of association of Tomkins Finance Limited provides as follows:

“Subject to the provisions of the Companies Act 1985 and every other Act or other statutory instrument for the time being in force concerning companies and affecting the company including any statutory re-enactment or

 

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modification of the Companies Act 1985 and every other act or statutory instrument (the “Statutes”), the company may purchase and maintain for any director, managing director, secretary or other officer or employee or agent of the company, insurance against any liability.

Subject to the provisions of the Statutes, but without prejudice to any indemnity to which the person concerned may otherwise be entitled, every person who is or has been a director, managing director, secretary and other officer or employee of the company shall (to the extent the proceeds of any insurance policy against such liability are insufficient to meet such liability in full) be indemnified out of the assets of the company against any liability relating to his conduct as, or incurred by him as, such director, managing director, secretary or other officer or employee of the company in defending any proceedings, whether civil or criminal, in which judgment is given in his favour or in which he is acquitted or in connection with any application under section 144(3) or section 144(4) or section 727 of the Companies Act 1985 in which relief is granted to him by the court.

If the board of directors of the company thinks fit, every agent of the company may be so indemnified against any liability incurred by him/them in defending any such proceedings.”

Beta Naco Limited

Article 25 (Indemnity) of the articles of association of Beta Naco Limited provides as follows:

“Every director or other officer or auditor of the Company for the time being shall be entitled to be indemnified out of the assets of the Company against all costs, charges, expenses, losses or liabilities which may sustain or incur in or about the execution of the duties of his office or otherwise in relation thereto, including any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgement is given in his favour or in which he is acquired, or in connection with any application under Section 144 or Section 727 of the Companies Act 1985 in which relief is granted to him by the court, and no director or other officer shall be liable for any loss, damage or misfortune which may happen to or be incurred by the Company in the execution of the duties of his office or in relation thereto, but this Article shall only have effect insofar as its provision are not avoided by Section 310 of the Act.”

Gates Engineering & Services UK Holdings Ltd.

Article 31 (Indemnity and Expenses) of the articles of association of Gates Engineering & Services UK Holdings Ltd provides as follows:

“To the extent permitted by law, the company may indemnify any director or former director of the company or of any associated company against any liability and may purchase and maintain for any director or former director of the company or of any associated company insurance against any liability.

The company may also fund a director’s or former director’s expenditure and that of a director or former director of any holding company of the company for the purposes permitted under the Companies Act 1985 and may do anything to enable a director or former director or a director or former director of any holding company of the company to avoid incurring such expenditure as provided in the Companies Act 1985.

No director or former director of the company or of any associated company shall be accountable to the company or the members for any benefit provided pursuant to this article and the receipt of any such benefit shall not disqualify any person from being or becoming a director of the company.

Regulation 118 of Table A shall not apply and Regulation 83 of Table A shall be modified accordingly.”

 

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Gates PowerTrain UK Limited

Article 83 (Indemnity) of the articles of association of Gates PowerTrain UK Limited provides as follows:

 

“83.1 Subject to Article 83.2, but without prejudice to any indemnity to which a relevant officer is otherwise entitled:

 

  83.1.1 each relevant officer shall be indemnified out of the company’s assets against all costs, charges, losses, expenses and liabilities incurred by him as a relevant officer:

 

  83.1.1.1 in the actual or purported execution and/or discharge of his duties, or in relation to them; and

 

  83.1.1.2 in relation to the company’s (or any associated company’s) activities as trustee of an occupational pension scheme (as defined in section 235(6) of the Companies Act 2006),

including (in each case) any liability incurred by him in defending any civil or criminal proceedings in which judgment is given in his favour or in which eh is acquitted or the proceedings are otherwise disposed of without any finding or admission of any material breach of duty on his part or in connection with any application in which the court grants him, in his capacity as a relevant officer, relief from liability for negligence, default, breach of duty or breach of trust in relation to the company’s (or any associated company’s) affairs; and

 

  83.1.2 the company may provide any relevant officer with funds to meet expenditure incurred or to be incurred by him in connection with any proceedings or application referred to in Article 83.1.1 and otherwise may take any action to enable any such relevant officer to avoid incurring such expenditure.

 

83.2 This Article does not authorise any indemnity which would be prohibited or rendered void by any provision of the Companies Act 2006 or by any other provision of law.

 

83.3 In this Article 83:

 

  83.3.1 Companies are associated if one is a subsidiary of the other or both are subsidiaries of the same body corporate; and

 

  83.3.2 A “relevant officer” means any director or alternate director or other officer or former director or other officer of the company or an associated company (including any company which is a trustee of an occupational pension scheme (as defined by section 235(6) of the Companies Act 2006) and may, if the members so decide include any person engaged by the company (or any associated company) as auditor (whether or not he is also a director or other officer), to the extent he acts in his capacity as auditor).

Article 84 (Insurance) if the articles of association of Gates PowerTrain UK Limited provides as follows:

 

84.1 “The director may decide to purchase and maintain insurance, at the expense of the company, for the benefit of any relevant officer in respect of any relevant loss.

 

84.2 In this Article 84:

 

  84.2.1 a “relevant officer” means any director or alternate director or other officer or former director or other officer of the company or an associated company (including any company which is a trustee of an occupational pension scheme (as defined by Section 235(6) of the Companies Act 2006;

 

  84.2.2 a “relevant loss” means any loss or liability which has been or may be incurred by a relevant officer in connection with that officer’s duties or powers in relation to the company, any associated company or any pension fund or employees’ share scheme of the company or associated company; and

 

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  84.2.3 companies are associated if one is a subsidiary of the other or both are subsidiaries of the same body corporate.”

Shiitake Limited

Article 35 (Indemnity) of the articles of association of Shiitake Limited provides as follows:

“Every director or other officer of the company shall be entitled to be indemnified out of the assets of the company against all losses or liabilities (including any such liability as is mentioned in paragraph (c) of the proviso to Section 152 of the Companies Act 1929) which he may sustain or incur in or about the execution of the duties of his office or otherwise in relation thereto, and no director or other officer shall be liable for any loss, damage or misfortune which may happen to or be incurred by the company in the execution of the duties of his office or in relation thereto. But this Article shall only have effect in so far as its provisions are not avoided by the said Section.”

Swindon Silicon Systems Limited, Tomkins Overseas Investments Limited and Tomkins Pension Services Limited

Article 7 (Indemnity) of the articles of association of Swindon Silicon Systems Limited, Article 16 (Indemnity) of the articles of association of Tomkins Overseas Investments Limited and Article 19 (Indemnity) of the articles of association of Tomkins Pension Services Limited provide as follows (except that paragraph (b) below is not included in the articles of association of Tomkins Overseas Investments Limited or Tomkins Pension Services Limited):

 

“(a) Every director or other officer of the company shall be indemnified out of the assets of the company against all losses or liabilities which he may sustain or incur in or about the execution of the duties of his office or otherwise in relation thereto, including any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgment is given in his favour or in which he is acquitted or in connection with any application under Section 448 of the Companies Act 1948, in which relief is granted to him by the court, and no director or other officer shall be liable for any loss, damage or misfortune which may happen to or be incurred by the company in the execution of the duties of his office or in relation thereto. But this Article shall only have effect in so far as its provisions are not avoided by Section 205 of the Companies Act 1948.

 

(a) Accordingly, Clause 136 of Part I of Table A shall not apply to the company.”

Tomkins Investments Limited

Article 27 (Indemnity) of the articles of association of Tomkins Investments Limited provides as follows:

“Subject to and so far as may be permitted by the Companies Act 1985, but without prejudice to any indemnity to which any person concerned may6 otherwise be entitled, the directors, alternate directors, auditors, secretary and other officers for the time being of the company shall be indemnified out of the assets of the company against any costs, charges, losses, expenses and liabilities incurred by them in the execution and discharge of their duties, including all liability incurred by them as such in defending any proceedings, whether civil or criminal, in which judgment is given in their favour, or in which they are acquitted or in connection with any application under the Companies Act 1985 in which relief is granted to them by the court. Regulation 118 of Table A shall not apply.”

Tomkins Limited (formerly Tomkins plc)

Article 123 of the articles of association of Tomkins Limited provides as follows:

 

“(A) As far as every statute (and any orders, regulations or other subordinate legislation made under it) applying to the company (the “legislation”) allows, the company:

 

  (i) can indemnify any director or former director of the company or of any associated company against any liability; and

 

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  (ii) can purchase and maintain insurance against any liability for any director or former director of the company or of any associated company.

 

(B) A director or former director of the company or of any associated company will not be accountable to the company or the shareholders for any benefit provided pursuant to this article. Anyone receiving such a benefit will not be disqualified from being or becoming a director of the company.”

Tomkins SC1 Limited

Article 135 (Indemnity) of the articles of association of Tomkins SC1 Limited provides as follows:

“Every director and other officer of the company (including an auditor) shall be indemnified out of the assets of the company against any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgment is given in his favour, or in which he is acquitted, or in connection with any application in which relief is granted to him by the court under the Companies Act 1948 and every statutory modification or re-enactment thereof for the time being in force.”

British Industrial Valve Company Limited

The articles of association of British Industrial Valve Company Limited do not contain any provisions for indemnification of the directors of that company.

Ruskin Air Management Limited and Tomkins Funding Limited

The articles of association of Ruskin Air Management Limited and Tomkins Funding Limited provide that Regulation 136 (Indemnity) contained in Table A of the Companies Act 1948 shall apply to such companies. Regulation 136 provides as follows:

“Every director, managing director, agent, auditor, secretary and other officer for the time being of the company shall be indemnified out of the assets of the company against any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgement is given in his favour or in which he is acquitted or in connection with any application under section 448 of the Companies Act 1948 in which relief is granted to him by the court.”

Willer & Riley Limited

The articles of association of Willer & Riley limited provide that Regulation 118 (Indemnity) contained in Table A of the Companies (Tables A to F) Regulations 1985 SI 1985/805 shall apply to the company. Regulation 118 provides as follows:

“Subject to the provisions of the Companies Act 1985 but without prejudice to any indemnity to which a director may otherwise be entitled, every director or other officer or auditor of the company shall be indemnified out of the assets of the company against any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgment is given in his favour or in which he is acquitted or in connection with any application in which relief is granted to him by the court from liability for negligence, default, breach of duty or breach of trust in relation to the affairs of the company.”

Chapter 7 of the Companies Act 2006

Directors’ Liabilities

Provision protecting directors from liability

 

232 Provisions protecting directors from liability

 

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(1) Any provision that purports to exempt a director of a company (to any extent) from any liability that would otherwise attach to him in connection with any negligence, default, breach of duty or breach of trust in relation to the company is void.

(2) Any provision by which a company directly or indirectly provides an indemnity (to any extent) for a director of the company, or of an associated company, against any liability attaching to him in connection with any negligence, default, breach of duty or breach of trust in relation to the company of which he is a director is void, except as permitted by—

 

(a) section 233 (provision of insurance),

 

(b) section 234 (qualifying third party indemnity provision), or

 

(c) section 235 (qualifying pension scheme indemnity provision).

(3) This section applies to any provision, whether contained in a company’s articles or in any contract with the company or otherwise.

(4) Nothing in this section prevents a company’s articles from making such provision as has previously been lawful for dealing with conflicts of interest.

 

233 Provision of insurance

Section 232(2) (voidness of provisions for indemnifying directors) does not prevent a company from purchasing and maintaining for a director of the company, or of an associated company, insurance against any such liability as is mentioned in that subsection.

 

234 Qualifying third party indemnity provision

(1) Section 232(2) (voidness of provisions for indemnifying directors) does not apply to qualifying third party indemnity provision.

(2) Third party indemnity provision means provision for indemnity against liability incurred by the director to a person other than the company or an associated company.

Such provision is qualifying third party indemnity provision if the following requirements are met.

(3) The provision must not provide any indemnity against—

 

(a) any liability of the director to pay—

 

  (i) a fine imposed in criminal proceedings, or

 

  (ii) a sum payable to a regulatory authority by way of a penalty in respect of non-compliance with any requirement of a regulatory nature (however arising); or

 

(b) any liability incurred by the director—

 

  (i) in defending criminal proceedings in which he is convicted, or

 

  (ii) in defending civil proceedings brought by the company, or an associated company, in which judgment is given against him, or

 

  (iii) in connection with an application for relief (see subsection (6)) in which the court refuses to grant him relief.

(4) The references in subsection (3)(b) to a conviction, judgment or refusal of relief are to the final decision in the proceedings.

(5) For this purpose—

 

(a) a conviction, judgment or refusal of relief becomes final—

 

  (i) if not appealed against, at the end of the period for bringing an appeal, or

 

  (ii) if appealed against, at the time when the appeal (or any further appeal) is disposed of; and

 

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(b) an appeal is disposed of—

 

  (i) if it is determined and the period for bringing any further appeal has ended, or

 

  (ii) if it is abandoned or otherwise ceases to have effect.

(6) The reference in subsection (3)(b)(iii) to an application for relief is to an application for relief under—

 

  (a) section 661(3) or (4) (power of court to grant relief in case of acquisition of shares by innocent nominee), or

 

  (b) section 1157 (general power of court to grant relief in case of honest and reasonable conduct).

 

235 Qualifying pension scheme indemnity provision

(1) Section 232(2) (voidness of provisions for indemnifying directors) does not apply to qualifying pension scheme indemnity provision.

(2) Pension scheme indemnity provision means provision indemnifying a director of a company that is a trustee of an occupational pension scheme against liability incurred in connection with the company’s activities as trustee of the scheme.

Such provision is qualifying pension scheme indemnity provision if the following requirements are met.

(3) The provision must not provide any indemnity against—

 

(a) any liability of the director to pay—

 

  (i) a fine imposed in criminal proceedings, or

 

  (ii) a sum payable to a regulatory authority by way of a penalty in respect of non-compliance with any requirement of a regulatory nature (however arising); or

 

(b) any liability incurred by the director in defending criminal proceedings in which he is convicted.

(4) The reference in subsection (3)(b) to a conviction is to the final decision in the proceedings.

(5) For this purpose—

 

(a) a conviction becomes final—

 

  (i) if not appealed against, at the end of the period for bringing an appeal, or

 

  (ii) if appealed against, at the time when the appeal (or any further appeal) is disposed of; and

 

(b) an appeal is disposed of—

 

(i) if it is determined and the period for bringing any further appeal has ended, or

 

(ii) if it is abandoned or otherwise ceases to have effect.

(6) In this section “occupational pension scheme” means an occupational pension scheme as defined in section 150(5) of the Finance Act 2004 (c 12) that is established under a trust.

 

236 Qualifying indemnity provision to be disclosed in directors’ report

(1) This section requires disclosure in the directors’ report of—

 

(a) qualifying third party indemnity provision, and

 

(b) qualifying pension scheme indemnity provision.

Such provision is referred to in this section as “qualifying indemnity provision”.

(2) If when a directors’ report is approved any qualifying indemnity provision (whether made by the company or otherwise) is in force for the benefit of one or more directors of the company, the report must state that such provision is in force.

 

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(3) If at any time during the financial year to which a directors’ report relates any such provision was in force for the benefit of one or more persons who were then directors of the company, the report must state that such provision was in force.

(4) If when a directors’ report is approved qualifying indemnity provision made by the company is in force for the benefit of one or more directors of an associated company, the report must state that such provision is in force.

(5) If at any time during the financial year to which a directors’ report relates any such provision was in force for the benefit of one or more persons who were then directors of an associated company, the report must state that such provision was in force.

 

237 Copy of qualifying indemnity provision to be available for inspection

(1) This section has effect where qualifying indemnity provision is made for a director of a company, and applies—

(a) to the company of which he is a director (whether the provision is made by that company or an associated company), and

 

(b) where the provision is made by an associated company, to that company.

(2) That company or, as the case may be, each of them must keep available for inspection—

 

(a) a copy of the qualifying indemnity provision, or

 

(b) if the provision is not in writing, a written memorandum setting out its terms.

(3) The copy or memorandum must be kept available for inspection at—

 

(a) the company’s registered office, or

 

(b) a place specified in regulations under section 1136.

(4) The copy or memorandum must be retained by the company for at least one year from the date of termination or expiry of the provision and must be kept available for inspection during that time.

(5) The company must give notice to the registrar—

 

(a) of the place at which the copy or memorandum is kept available for inspection, and

 

(b) of any change in that place,

unless it has at all times been kept at the company’s registered office.

(6) If default is made in complying with subsection (2), (3) or (4), or default is made for 14 days in complying with subsection (5), an offence is committed by every officer of the company who is in default.

(7) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 3 on the standard scale.

(8) The provisions of this section apply to a variation of a qualifying indemnity provision as they apply to the original provision.

(9) In this section “qualifying indemnity provision” means—

 

(a) qualifying third party indemnity provision, and

 

(b) qualifying pension scheme indemnity provision.

 

238 Right of member to inspect and request copy

(1) Every copy or memorandum required to be kept by a company under section 237 must be open to inspection by any member of the company without charge.

(2) Any member of the company is entitled, on request and on payment of such fee as may be prescribed, to be provided with a copy of any such copy or memorandum.

The copy must be provided within seven days after the request is received by the company.

(3) If an inspection required under subsection (1) is refused, or default is made in complying with subsection (2), an offence is committed by every officer of the company who is in default.

(4) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 3 on the standard scale.

 

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(5) In the case of any such refusal or default the court may by order compel an immediate inspection or, as the case may be, direct that the copy required be sent to the person requiring it.

Ratification of acts giving rise to liability

 

239 Ratification of acts of directors

(1) This section applies to the ratification by a company of conduct by a director amounting to negligence, default, breach of duty or breach of trust in relation to the company.

(2) The decision of the company to ratify such conduct must be made by resolution of the members of the company.

(3) Where the resolution is proposed as a written resolution neither the director (if a member of the company) nor any member connected with him is an eligible member.

(4) Where the resolution is proposed at a meeting, it is passed only if the necessary majority is obtained disregarding votes in favour of the resolution by the director (if a member of the company) and any member connected with him. This does not prevent the director or any such member from attending, being counted towards the quorum and taking part in the proceedings at any meeting at which the decision is considered.

(5) For the purposes of this section—

 

(a) “conduct” includes acts and omissions;

 

(b) “director” includes a former director;

 

(c) a shadow director is treated as a director; and

(d) in section 252 (meaning of “connected person”), subsection (3) does not apply (exclusion of person who is himself a director).

(6) Nothing in this section affects—

 

(a) the validity of a decision taken by unanimous consent of the members of the company, or

(b) any power of the directors to agree not to sue, or to settle or release a claim made by them on behalf of the company.

(7) This section does not affect any other enactment or rule of law imposing additional requirements for valid ratification or any rule of law as to acts that are incapable of being ratified by the company.

German Guarantors

Eifeler Maschinenbau GmbH

Gates Holding GmbH

Gates Mectrol GmbH

Trion (Deutschland) GmbH

Tridon Clamp Products GmbH

German Law

Under German law a managing director of a German Guarantor shall be entitled to claim indemnification from a shareholder of a German Guarantor in the event that the managing director will be liable for a business-destroying intervention (existenzvernichtender Eingriff) jointly with the shareholder provided that the shareholder has instructed the managing director to the action or omission resulting into the business-destroying intervention.

Following the German legal principles regarding the “mandate and contract for the management of the affairs of another” and in particular sec. 670 of the German Civil Code (“BGB”), a German Guarantor will be obliged to make reimbursement of all expenses (Aufwendungen) incurred by a managing director for the purpose of performing a mandate on behalf of the respective German Guarantor that the managing director lawfully considered to be necessary in the circumstances.

 

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The managing directors may also be entitled to ask for indemnification by a German Guarantor pursuant to sect. 426 (1) BGB in case of joint liability with the German Guarantor vis-à-vis third parties, provided that the managing director has not violated any of his/her obligations towards the German Guarantor. The same principles apply in case of a joint and several liability of two or more managing directors among themselves. In case of a joint liability of a managing director and the respective German Guarantor vis-à-vis the German tax authorities for any tax payments, the managing director is entitled to ask for indemnification by the German Guarantor in respect to the primary tax obligation but excluding any fine for late payment. The right to ask for such indemnification does not exist, however, if and to the extent the managing director and the German Guarantor would be liable based on tort (sect. 823 to 853, 31 BGB).

Articles of Incorporation

The articles of incorporation of each of the German Guarantors do not contain indemnification provisions.

Luxembourg Guarantors

Schrader Investments Luxembourg S.à r.l.

Tomkins American Investments S.à r.l.

Tomkins Automotive Company, S.à r.l.

Tomkins Holdings Luxembourg, S.à r.l.

Tomkins Investments Company S.à r.l.

Tomkins Luxembourg S.à r.l.

Tomkins Overseas Holdings S.à r.l.

Luxembourg Law

Each of the Luxembourg Guarantors is incorporated as a private limited company (société à responsabilité limitée or “S.à r.l”) under the laws of Luxembourg. Managers of a Luxembourg S.à r.l. may be held personally liable as managers for their acts in such capacity in the following circumstances: (i) they can be held individually liable toward the company, but not to third parties, for mismanagement; (ii) they can be held jointly and severally liable toward the company and third parties from a breach of the provisions of the law of 10 August 1915 on commercial companies, as amended, or of the articles of association of the company (unless they did not participate in the breach and brought the facts to the knowledge of the shareholders immediately upon becoming aware of such facts); and (iii) they can be held liable, to any other person, for tort as to damages only which are distinct from a damage that would be suffered by the company.

A Luxembourg company may be held liable for criminal offenses where a criminal action has been committed in the name and for the benefit of such company, by one of its legal or de facto representatives. As Luxembourg provisions do not exclude accumulation of liabilities, such representatives may also have their criminal liability withheld.

Luxembourg law does not contain provisions regarding the indemnification of managers and officers. However, according to Luxembourg employment law, an employer may, under certain circumstances, be required to indemnify an employee against losses and expenses incurred by him in the execution of his duties under an employment agreement, unless the losses and expenses arise from the employee’s gross negligence or willful misconduct.

Articles of Incorporation

The articles of incorporation of each of the Luxembourg Guarantors do not contain indemnification provisions.

Mauritius Guarantor

Tomkins Mauritius Company Limited

 

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Companies Act 2001

The Companies Act 2001 (the “Mauritius Companies Act”) generally prohibits a company from indemnifying or directly or indirectly effecting insurance for its directors or employees in relation to:

 

  •  

liability for any act/omission of the director or employee in his capacity as director or employee; or

 

  •  

costs incurred by that director or employee in defending or settling any claim or proceedings relating to any such liability.

Any such indemnity given is deemed void. However, directors or employees may, in the circumstances outlined in paragraphs below, be indemnified for breach of duty.

A company may indemnify a director or employee for any costs he may have incurred in proceedings that relate to liability for any act or omission in his capacity as director or employee. Provided that the indemnity is expressly authorised by the constitution of the company, the director or employee must have either obtained judgment in his favour, been acquitted, had proceedings which were initiated against him discontinued, been granted relief by the Court or, had, where proceedings were threatened, the threatened action abandoned or not pursued.

A company may indemnify a director or employee for any liability to a third party (i.e. a person other than the company itself or a related company) in the capacity of director or employee. Such indemnity must be expressly provided for in the constitution of the company. However, a director may not be indemnified against criminal liability or for any liability arising from breach of duty to act in good faith or in the best interests of the company.

The Act allows a company to effect insurance for its directors and employees, in respect of:

 

  •  

liability (other than criminal liability) for any act/omission in his capacity as a director or employee;

 

  •  

costs incurred by that director or employee in defending or settling any claim or proceeding relating to any such liability; or

 

  •  

costs incurred by that director or employee in defending any criminal proceedings, either that have been brought against the director or employee in relation to any act/omission of that director or employee in his capacity as director or employee, in which that person is either acquitted or a nolle prosequi is entered.

A company may provide insurance cover for a director or employee with prior approval of the Board and provided the constitution of the company contains such express authorisation for such grant of insurance cover.

The Board of the company is also under obligation to make all the necessary disclosures in respect of such indemnities or insurance in the directors’ interests register (if any), the minutes and the annual report. If a company covers a director or employee, and the provisions of the Act regarding insurance and the mandatory disclosures have not been complied with, the director or employee will be personally liable to the company for the cost of effecting the insurance, unless the director or employee proves that it was fair to the company at the time the insurance was effected.

Constitution

The provisions in constitution of the Mauritius Guarantor as regards the indemnification of directors / employees reflect the stipulations of the Mauritius Companies Act, outlined above.

Mexican Guarantors

AMP Industrial Mexicana S.A. de C.V.

Aplicadores Mexicanos, S.A. de C.V.

 

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Auto Industrial de Partes, S.A. de C.V.

Ruskin de Mexico S.A. de C.V.

Tomkins Poly Belt Mexicana, S.A. de C.V.

Mexican Law

Under Mexican law, when an officer or director of a Mexican corporation acts within the scope of his authority, the Mexican corporation shall be responsible for any resulting third party liabilities or expenses. However, please note that under certain specific circumstances pertaining to tax, and environmental irregularities of the Mexican corporation, its officers or directors may be personal and jointly liable with the Mexican corporation. This type of liability should be contractually covered by an indemnity given by the Mexican corporation in favor of the officers or directors.

Bylaws

The bylaws of the Mexican Guarantors as of the date hereof do not include specific indemnification provisions with respect to the officers or directors of the Mexican Guarantors.

Dutch BV Guarantor

Pinafore Holdings B.V.

Dutch Law

Under Dutch law the following applies with respect to the liability of members of the managing board and possible indemnification by a besloten vennootschap met beperkte aansprakelijkheid (“BV”).

As a general rule, members of the managing board of a BV are not liable for obligations incurred by or on behalf of the company. Under certain circumstances, however, members of the managing board of a BV may be liable to the company for damages in the event of improper or negligent performance of their duties. They may be jointly and severally liable for damages to the company and to third parties for infringement of the articles of association or of certain provisions of the Dutch Civil Code. In certain circumstances, members of the managing board may also incur additional specific civil and criminal liabilities.

With respect to their liability with respect to a BV the following applies. As a general rule, each director of the managing board must properly perform the duties assigned to him or her. Failure of a director in his duties does not automatically lead to liability. Liability is only incurred in case of severe reproach. The liability of directors towards the company can be waived by a discharge (décharge). Discharge is generally granted by the general meeting of shareholders. Such discharge in principle only releases directors from liability for actions which have been disclosed at or to the general meeting of shareholders or which appear from the annual accounts. A discharge does not affect the liability of the directors towards third parties or their liability to any trustee in bankruptcy.

With respect to directors’ liability with respect to third parties, there are various statutory grounds pursuant to which a director of the managing board of a BV may be held liable, such as specific liability in bankruptcy, liability for tax debts, social security contributions and contributions to mandatory pension funds, liability based on tort, liability for misrepresentation in annual accounts and personal liability of directors under Dutch criminal law (including economic offenses).

Limited Partnership Agreement

The limited partnership agreement of the Dutch BV Guarantor does not include specific indemnification provisions with respect to its general partner.

 

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Dutch CV Guarantor

Montisk Investments Netherlands C.V.

Under the laws of the Netherlands a commanditaire vennootschap (“CV”) is not a legal person (rechtspersoon), but a partnership established by an agreement between one or more general partners (beherend vennoten), whose liability is unlimited, and one or more limited partners (commanditaire vennoten), whose liability in principle is limited to the amount of their capital contributions. Please note, that the liability of a limited partner may become unlimited, if that limited partner becomes too involved in the management of the CV.

The capital and/or assets contributed by the partners to the CV belong, in principle, legally and/or economically, in joint ownership to the partners of the CV. A CV is however deemed to legally have a separate estate (afgescheiden vermogen). This means that in respect of the assets of the CV the creditors of the CV have priority over the other creditors of the general partners.

Limited Partnership Agreement

The limited partnership agreement of the Dutch CV Guarantor does not include specific indemnification provisions with respect to its general partner.

Northern Ireland Guarantor

Schrader Electronics Limited

Companies Act 2006

As a part of the United Kingdom, Northern Ireland is subject to the provisions of the Companies Act, 2006 (the “CA 2006”). The relevant sections of the CA 2006 are sections 205 (defence costs loan), 232 and 234–235 (director indemnities), 236–238 (public disclosure) and 239 (ratification of conduct).

Restrictions in the CA 2006 apply to indemnities provided to directors of companies incorporated under the CA 2006 or any of its predecessors, namely companies incorporated in the UK. The CA 2006 does not restrict the scope of any indemnity that may be offered to:

 

  (i) employees and other individuals who are not directors of a UK company in a group of companies; or

 

  (ii) directors of non-UK companies.

All references to a company in this summary shall refer to a UK company.

Section 205 of the CA 2006 allows a company to lend money to a director to finance his legal and other costs involved in defending himself against any civil regulatory or criminal proceedings brought against him alleging breach of duty, breach of trust or negligence in relation to the company or any associated company.

The loan may also cover the cost of an application for relief from liability under s. 661(3) or (4) (Liability of others where nominee fails to make payment in respect of shares) or s. 1157 (Power to grant relief in certain circumstances) of the CA 2006. The funding must be by way of a loan because the CA 2006 requires that in some circumstances when the director is found to have acted in breach of duty, or where is convicted of a criminal offence, he must repay what the company has funded on his behalf.

The CA 2006 requires the funding arrangement to be such that, subject to two exceptions, the loan involved is repayable immediately in the event that the final outcome of the proceedings is that the director is not exonerated. There are two exceptions to the statutory requirement that the director must repay a company loan if he is not exonerated of wrongdoing, namely if the director is found guilty in a third party civil action (i.e. one not brought by or on behalf of the company or any of its UK-incorporated associated companies), and a regulatory proceeding against him. In these two instances, the company has discretion as to whether or not to indemnify a director for his defence costs and (if so) whether to do so via a loan or direct indemnity arrangement.

 

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In a case where the director is exonerated of wrongdoing, or is not otherwise required by the CA 2006 and the company to repay the loan, it may be written off by way of indemnity, unless the indemnity contract itself provides otherwise. The obligation to impose a contingent repayment obligation necessitates the loan arrangement being documented in a formal contract.

Qualifying third party indemnity provision (“QTPIP”)

Section 234 of the CA 2006 allows a company incorporated under the CA 2006, or any of its predecessors, to provide a director of the company or of any of its UK associated companies (i.e. other UK-incorporated companies in the same group) with an indemnity against certain liabilities via a QTPIP. Any broader indemnity to a director is rendered void by virtue of the CA 2006.

A QTPIP permits a company to indemnify a director against any liability that he may incur (in any capacity) in connection with any negligence, default, breach of duty or breach of trust in relation to the company of which he is a director or any associated company if, but only if, the liability arose out of third party civil proceedings. A QTPIP cannot provide the director with an indemnity in respect of a liability:

(i) owed to the company or any of its UK associated companies, as that would render the remedy obtained by the company in the breach of duty proceedings against the director valueless, and so would be contrary to public policy; or

(ii) imposed in criminal or regulatory proceedings by way of a fine or penalty for wrongdoing. In the case of FSA fines, this is supplemented by a specific regulatory prohibition under the Financial Services & Markets Act 2000.

Any indemnity provided in respect of liabilities mentioned in (i) or (ii) above is rendered void by s. 232(2) of the CA 2006.

Section 232(1) makes void any provision which purports to exempt a director from any liability that would otherwise attach to him in connection with his negligence, default, breach of duty or breach of trust in relation to the company.

Indemnification of directors of pension trustee companies

Section 235 of the CA 2006, a new provision, allows a company to provide a slightly wider form of indemnity (a so-called qualifying pension scheme indemnity provision) to directors of a UK-incorporated pension trustee company in the group than that described above. The additional protection that may be offered to a director of such a company is an indemnity that extends to the costs of an unsuccessful defence of civil and regulatory (but not criminal) proceedings against a pensions trustee company director.

Indemnification powers in articles of association of companies

As a decision to grant an indemnity contract to a director, and/or to lend him money to fund his defence, involves a fiduciary relationship between the company and the director(s) concerned, it is necessary for the board to be given the express power to do so within the company’s articles of association. The same applies to the purchase of D&O insurance for the company’s directors.

The powers given by this article shall not limit any general powers of the company to grant indemnities, purchase and maintain insurance or provide funds (whether by way of loan or otherwise) to any person in connection with any legal or regulatory proceedings or applications for relief.

The form of the indemnity contract

Any indemnity will need to be documented by contract, as will any defence costs loan arrangement. It has been held by the courts that directors cannot rely on an indemnification provision in the company’s articles of association, even where the article expresses the directors’ indemnity rights in mandatory form. That is because the articles constitute a contract between the company and its members, not between the company and its directors. A director’s right to be indemnified therefore derives from his contractual relationship with the company.

 

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Indemnity contracts can be effected by deed or by deed poll.

Disclosure requirements

Section 236 of the CA 2006 requires disclosure of the existence of QTPIPs and QPSIPs from which any director of a company benefits. That disclosure must be made in the directors’ report and must make reference to any qualifying indemnity which was in force at the date when the directors’ report was approved or during the financial year to which the directors’ report refers.

Where a company has given a qualifying indemnity for the benefit of a director of an associated company disclosure is required in the directors’ reports of both the company granting the indemnity and of the associated company involved.

In addition, under sections 237 and 238 of the CA 2006, the company is required to keep available for inspection a copy of every QTPIP and QPSIP in force whose existence it is required to disclose in its directors’ report (or a memorandum setting out its terms). The copy or memorandum must be made available at the company’s registered office or, if it is not kept at the registered office, at another location notified to the Registrar of Companies under s. 1136 of the CA 2006.

A failure to notify the Registrar of a different location at which the indemnity is available for inspection is an offence. Members of the company are entitled to inspect the qualifying indemnity or the memorandum setting out its terms without charge and (on payment of a prescribed fee) to be provided with a copy.

Ratification of director negligence

Section 239 of the CA 2006 allows a company to ratify a director’s or former director’s negligent conduct and his breach of duty. Ratification requires either a shareholder resolution or the unanimous consent of all the company’s members. The votes of the director and of persons connected with him are not to be counted in determining whether the requisite majority of votes has been obtained at a shareholder meeting.

AoA Provisions

Every director, auditor, secretary or other officer of the Northern Ireland Guarantor shall be entitled to be indemnified by the Northern Ireland Guarantor against all costs, charges, losses, expenses and liabilities incurred by him in the execution and/or discharge of his duties and/or the exercise of his powers and/or otherwise in relation to or in connection with his duties, powers or offices, including any liability incurred by him in defending any proceedings, civil or criminal, which relate to anything done or omitted or alleged to have been done or omitted by him as an officer or employee of the Northern Ireland Guarantor and which judgement is given in his favor (or the proceedings are otherwise disposed of without any finding or admission of any material breach of duty on his part) or in which he is acquitted or in connection with any application under any statute for relief from liability in respect of any such act or omission in which relief is granted.

Russia Guarantor

Gates CIS LLC

Russian Law Provisions

Members of the board of directors of a Russian limited liability company may incur civil, administrative and/or criminal liabilities under Russian legislation for violations of legal norms or non-fulfilment of their duties. Such liabilities are personal in nature, i.e., liability is imposed on a person only if violations are committed due to his or her fault.

 

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The general provision concerning liability of directors is found in Article 53.3 of the Civil Code, which imposes on a director the requirement to act in good faith and reasonably in the interests of the company and, failing that, to compensate any damages inflicted upon the company. More specific guidance on this matter is given by Article 44 of the Federal Law dated February 8, 1998, as amended, No. 14-FZ “On the Limited Liability Companies” (the “Russian LLC Law”) whereby a director can be held liable for damages sustained by the company and caused by his/her culpable acts or failure to act.

When determining the existence or amount of a director’s liability for breaches of his duty, the Russian LLC Law requires that at least two factors be taken into account. First, a director is not liable for losses caused by actions (or inaction) causing damages to the company if he voted against the relevant decision or did not take part in the voting. Second, the Russian LLC Law provides that “customs of commercial activity and other circumstances relating to the specific case” must be taken into account in determining the liability of directors.

The scope of a director’s civil liability is not limited to direct damages but potentially also includes lost profits in accordance with Article 15 of the Civil Code.

A court action to compensate losses caused to the company by culpable actions or inaction by a manager or director of the company may be initiated by the company or its participant(s).

Turkish Guarantors

Gates Güç Aktarim Sistemleri Dağitim Sanayi ve Ticaret Limited Şirketi

Gates Powertrain Plastik Metal ve Makina Sanayii ve Ticaret Limited Şirketi

Collectively, the above-noted entities are the “Turkish Guarantors.” The liabilities of, and indemnification to, the managers of the Turkish Guarantors, can be determined as per (i) the principles set forth under Turkish law with respect to liability of the managers in a limited liability partnership (a “Turkish LLP”); and (ii) the principles set forth under the articles of association (the “Turkish AoA”) of each Turkish Guarantor.

Turkish Law Provisions

The relevant provisions are set forth under the (i) Turkish Commercial Code (“TCC”), and (ii) certain other legislation.

 

  (i) Provisions under the TCC:

According to the TCC, a Turkish LLP does not have a board of directors. Under the TCC, a person who performs a general managerial role, carrying out the business and activities of and representing and binding a Turkish LLP is defined under the TCC as the “principal” (“müdür”) of the company.

Under the TCC, as a general principle, a Turkish LLP principal would not be held personally liable for the acts and the contracts he/she has performed on behalf of the Turkish LLP.

However, a principal, negligently or fraudulently, failing to perform his/her duties vested in him/her by the TCC or by other applicable pieces of legislation or the articles of association, will be held liable against the company, the partners and the creditors of the company. The partners and the creditors of the Turkish LLP may file a lawsuit against the principals for the compensation of either their (a) indirect damages (such as damages decreasing the value of the Turkish LLP’s assets) or (b) direct damages (damages incurred irrespective of any damages to the company itself).

The TCC further sets forth the following reasons for invoking the liability of a principal: (i) incorrect payments made by the partners in respect of their capital contributions, (ii) distribution and payment of dividends, irrespective of the actual situation-not reflected in the balance sheet, (iii) corporate books and records’, which are required to be maintained as per the applicable laws, not being present or not being properly kept; (iv) non-implementation of partners’ assembly meetings without any valid causes); (v) non-compliance with the applicable

 

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law in the increase of share capital; (vi) initiation of lawsuits against the decisions of the general assembly of partners in bad faith; and (vii) not investigating the corrupt acts in the formation phase of the Turkish LLP, (please note that criminal liability of a principal may also be invoked if this would be the case).

 

  (ii) Provisions under other legislation:

Tax Legislation: In the event that a Turkish LLP fails to pay its taxes, the principal of such Turkish LLP may be held personally liable and ordered to pay the taxes in addition to default payments and penalties.

Social Insurance Legislation: Pursuant to the Law on Social Insurance and General Health Insurance, the principal of a Turkish LLP may be held jointly and severally liable with the company for the overdue premium debts (together with the monetary penalties and accrued interest), deducted from the employees’ wages to the Social Security Institution.

Employment Legislation: Under Turkish Employment Law, a person, who acts on behalf of the employer and participates in the administration of a company, is deemed to be the “employer’s agent”, and may be subject to certain monetary penalties. The principal of a Turkish LLP may be considered as the employer’s agent and such monetary penalties may be imposed on the principal as well.

Environmental Legislation: Under the Environmental Law, a person who directly or indirectly pollutes the environment will be held responsible. However, if such act of pollution constitutes a crime under the Turkish Criminal Code, the relevant Public Prosecutor may at its sole discretion include the officers of a company (e.g. the principal of a Turkish LLP) within the scope of criminal prosecution process.

Criminal Law: As per the general principle under Turkish criminal law regarding the individuality of criminal liability (ceza sorumluluğunun şahsiliği kurali), the main principle is prosecution of and application of criminal sanctions and penalties to individuals, and concept of “enterprise liability” is rejected in principle. Accordingly, if the relevant public prosecutor determines that a criminal offense has been committed by an action of a legal entity, it may be possible that the officers of such entity (e.g. the principal of a Turkish LLP) may be included within the scope of the criminal prosecution process.

AoA Provisions

The AoAs of the Turkish Guarantors do not include specific indemnification provisions with respect to the managers of the Turkish Guarantors.

United Arab Emirates (“UAE”) Guarantors

Gates Engineering & Services FZCO

Gates Engineering & Services Hamriyah FZE

UAE Law Provisions

Federal Law No. 8 of 1984 Concerning Commercial Companies, as amended from time to time (“UAE Companies Law”) applies to all corporate entities incorporated in the UAE, except that the UAE Companies Law does not apply to companies incorporated in UAE free zones to the extent that the subject matter of the UAE Companies Law is addressed in the implementing regulations of the relevant free zone.

Gates Engineering & Services Hamriyah FZE is subject to the Hamriyah Free Zone Implementing Rules and Regulations Concerning the Establishment of Free Zone Establishments at HFZ issued pursuant to Sharjah Emiri Decree No. 6 of 1995 (“HFZ Implementing Regulations”). Gates Engineering & Services FZCO is subject to Implementing Regulations No. 1/99 issued by the Jebel Ali Free Zone Authority pursuant to Law No. 2 of 1986 Concerning the Formation of Legal Establishments at JAFZ (“JAFZ Implementing Regulations”, and together with the HFZ Implementing Regulations, the “Implementing Regulations”).

As neither Gates Engineering & Services Hamriyah FZE nor Gates Engineering & Services FZCO have a memorandum or articles of association, the relevant Implementing Regulations set out the principal corporate governance requirements and the UAE Companies Law will apply in respect of any corporate matters not addressed in the relevant Implementing Regulations.

The Implementing Regulations do not address the liability or potential liability of directors and officers nor do they address the indemnification or possible indemnification of directors and officers of companies incorporated in the relevant free zone.

Article 115 of the UAE Companies Law provides that any resolution adopted by the general assembly of a Company approving the release of the board of directors from liability shall not be effective in respect of faults and mistakes made by the directors in the performance of their functions. Pursuant to Article 115, in the event that the general assembly ratifies a specific act carried out by the board on behalf of the Company, the shareholders will only have a period of one year from the date of the ratification to make a claim against the directors for any liability incurred in respect of the relevant act. However, the UAE Companies Law is silent with regard to a company’s ability to indemnify its directors and officers from liability arising from carrying out their duties.

 

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  1. Exhibits

 

Exhibit
No.

   

Description

 3.1    Articles of Association of Pinafore Holdings B.V.
 3.2    Partial Amendment of the Articles of Association of Pinafore Holdings B.V.
 3.3    Certificate of Incorporation of Tomkins, Inc.
 3.4    Certificate of Amendment to Certificate of Incorporation of Tomkins, Inc.
 3.5    Bylaws of Tomkins, Inc.
 3.6    Certificate of Formation of Tomkins, LLC
 3.7    Certificate of Amendment to Certificate of Formation of Tomkins, LLC
 3.8    Amended and Restated Limited Liability Company Agreement of Tomkins, LLC
 4.1    Indenture, dated as of September 29, 2010, among Pinafore, LLC (now Tomkins, LLC), Pinafore, Inc. (now Tomkins, Inc.), Pinafore holdings B.V., the note guarantors named therein and Wilmington Trust FSB, as trustee.
 4.2    First Supplemental Indenture, dated as of November 18, 2010, among Tomkins Mauritius Company Limited, Schrader Electronics Limited, ACD Tridon Inc., Ruskin Company Canada Inc., Tomkins Automotive Canada Limited and Wilmington Trust FSB, as trustee.
 4.3    Second Supplemental Indenture, dated as of December 21, 2010, among Gates Engineering & Services Ltd., Gates Fleximak Ltd., Gates CIS LLC, Eifeler Maschinenbau GMBH, Gates Holding GMBH, Gates Mectrol GMBH, Tridon Clamp Products GMBH, Trion (Deutschland) GMBH and Wilmington Trust FSB, as trustee.
 4.4    Third Supplemental Indenture, dated as of December 23, 2010, among Gates Power Transmission Europe BVBA and Wilmington Trust FSB, as trustee.
 4.5    Fourth Supplemental Indenture, dated as of January 20, 2011, among Gates Engineering & Services Australia Pty Ltd CAN 142 531 244 and Wilmington Trust FSB, as trustee.
 4.6    Fifth Supplemental Indenture, dated as of February 23, 2011, among Schrader International Brasil Ltda., AMP Industrial Mexicana, S.A. de C.V., Aplicadores Mexicanos, S.A. de C.V., Auto Industrial de Partes, S.A. de C.V., Ruskin de México, S.A. de C.V., Tomkins Poly Belt Mexicana, S.A. de C.V., Gates Powertrain Plastik Metal Ve Makina Sanayii Ve Ticaret Limited Sirketi, Gates Guc Aktarim Sistemler Dagitim Sanayi Ve Ticaret Limited Sirketi, Gates Engineering & Services FZCO and Wilmington Trust FSB, as trustee.
 4.7    Sixth Supplemental Indenture, dated as of February 24, 2011, among Gates Powertrain UK Limited and Wilmington Trust FSB, as trustee.
 4.8    Seventh Supplemental Indenture, dated as of March 3, 2011, among Gates Engineering & Services Hamriyah FZE and Wilmington Trust FSB, as trustee.
 4.9    Form of 9% Senior Secured Second Lien Note due 2018 (included in Exhibit 4.2).
 4.10    Registration Rights Agreement, dated as of September 29, 2010, by and among Pinafore, LLC (now Tomkins, LLC), Pinafore, Inc. (now Pinafore, Inc.), Pinafore Acquisitions Limited (now Tomkins Acquisitions Limited), the other guarantors party thereto, Banc of America Securities LLC, Citigroup Global Markets Inc., Barclays Capital Inc., RBC Capital Markets Corporation and UBS Securities LLC.
 4.11    Third Supplemental Trust Deed relating to the £750,000,000 EMTN Program, dated August 28, 2003.
 5.1    Opinion of Latham & Watkins LLP.
 5.2    Opinion of Lathrop & Gage LLP.
 5.3    Opinion of May Oberfell Lorber.
 5.4    Opinion of Dinsmore & Shohl (Ohio) LLP.
 5.5    Opinion of Dykema Gossett PLLC.
 5.6    Opinion of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC.
 5.7    Opinion of Garvey Schubert Barer.
 5.8    Opinion of Allen & Overy.
 5.9    Opinion of DLA Piper UK LLP.
 5.10    Opinion of Pinheiro Neto Advogados.

 

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Exhibit
No.

   

Description

  5.11    Opinion of Walkers.
  5.12    Opinion of Davies Ward Phillips & Vineberg LLP.
  5.13    Opinion of Latham & Watkins (London) LLP.
  5.14    Opinion of Latham & Watkins (Munich) LLP.
  5.15    Opinion of Freshfields Bruckhaus Deringer Amsterdam B.V.
  5.16    Opinion of Luther Rechtsanwaltsgesellschaft mbH.
  5.17    Opinion of Appleby.
  5.18    Opinion of Ritch Mueller, S.C.
  5.19    Opinion of Arthur Cox.
  5.20    Opinion of Latham & Watkins (Moscow) LLP
  5.21    Opinion of Hergüner Bilgen Özeke Avukatlik Ortakliği.
  5.22*    Opinion of Hadef & Partners.
  5.23    Opinion of Dinsmore & Shohl (Kentucky) LLP.
10.1*    Credit Agreement, dated as of July 27, 2010 as amended and restated on August 6, 2010 and as further amended and restated on September 21, 2010 among Pinafore, LLC, Pinafore, Inc., Pinafore Acquisitions Limited, the Guarantors party hereto, Citibank, N.A., as Administrative Agent, Collateral Agent, L/C Issuer and Swing Line Lender, each lender from time to time party hereto, Banc of America Securities LLC, as Syndication Agent, Citigroup Global Markets Inc., Banc of America Securities LLC, Barclays Capital, RBC Capital Markets and UBS Securities LLC, as Joint Lead Arrangers and Joint Bookrunners, and Citigroup Global Markets Inc., Barclays Bank PLC, RBC Capital Markets and UBS Securities LLC, as Co-Documentation Agents.
10.2*    Amendment No. 3 to the Credit Agreement, dated as of September 28, 2010, among Pinafore, LLC, Pinafore, Inc., Pinafore Acquisitions Limited, the Guarantors party hereto, Citibank, N.A., as Administrative Agent, Collateral Agent, L/C Issuer and Swing Line Lender, each lender from time to time party hereto, Banc of America Securities LLC, as Syndication Agent, Citigroup Global Markets Inc., Banc of America Securities LLC, Barclays Capital, RBC Capital Markets and UBS Securities LLC, as Joint Lead Arrangers and Joint Bookrunners, and Citigroup Global Markets Inc., Barclays Bank PLC, RBC Capital Markets and UBS Securities LLC, as Co-Documentation Agents.
10.3*    Amendment No. 4 to the Credit Agreement, dated as of February 17, 2011, among Tomkins, LLC, Tomkins, Inc., Pinafore Holdings B.V., the Guarantors party hereto, Citibank, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender, Citicorp USA Inc., as Collateral Agreement, each lender from time to time party hereto, Merrill Lynch, Pierce, Fenner & Smith Incorporation, as Syndication Agent, Citigroup Global Markets Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Barclays Capital, RBC Capital Markets and UBS Securities LLC, as Joint Lead Arrangers and Joint Bookrunners, and Citigroup Global Markets Inc., Barclays Bank PLC, RBC Capital Markets and UBS Securities LLC, as Co-Documentation Agents.
10.4*    U.S. Security Agreement, dated as of July 27, 2010, as amended and restated on September 21, 2010, among the grantors identified therein and Citicorp USA, Inc., as collateral agent.
10.5*    Supplement No. 1 to the U.S. Security Agreement, dated as of September 29, 2010, among the grantors identified therein and Citicorp USA, Inc., as collateral agent.
10.6    U.S. Second Lien Notes Security Agreement, dated as of September 29, 2010, among the grantors identified therein and Wilmington Trust FSB, as collateral agent.
10.7*    Security Agreement, dated as of September 30, 2010, between the chargors named therein and Citicorp USA, Inc.
10.8    Security Agreement, dated as of September 30, 2010, between the chargors named therein and Wilmington Trust FSB, as collateral agent.
12.1    Statement of Computation of Ratio of Earnings to Fixed Charges.
21.1    List of Subsidiaries.
23.1    Consent of Deloitte LLP, Independent Registered Public Accounting Firm.
23.2    Consent of Latham & Watkins LLP (included in Exhibit 5.1).
23.3    Consent of Lathrop & Gage LLP (included in Exhibit 5.2).
23.4    Consent of May Oberfell Lorber (included in Exhibit 5.3).
23.5    Consent of Dinsmore & Shohl LLP (included in Exhibit 5.4).
23.6    Consent of Dykema Gossett PLLC (included in Exhibit 5.5).
23.7    Consent of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC (included in Exhibit 5.6).
23.8    Consent of Garvey Schubert Barer (included in Exhibit 5.7).
23.9    Consent of Allen & Overy (included in Exhibit 5.8).
23.10    Consent of DLA Piper UK LLP (included in Exhibit 5.9).
23.11    Consent of Pinheiro Neto Advogados (included in Exhibit 5.10).
23.12    Consent of Walkers (included in Exhibit 5.11).
23.13    Consent of Davies Ward Phillips & Vineberg LLP (included in Exhibit 5.12).
23.14    Consent of Latham & Watkins (London) LLP (included in Exhibit 5.13).
23.15    Consent of Latham & Watkins LLP (included in Exhibit 5.14).
23.16    Consent of Freshfields Bruckhaus Deringer Amsterdam B.V. (included in Exhibit 5.15).
23.17    Consent of Luther Rechtsanwaltsgesellschaft mbH (included in Exhibit 5.16).
23.18    Consent of Appleby (included in Exhibit 5.17).
23.19    Consent of Ritch Mueller, S.C. (included in Exhibit 5.18).
23.20    Consent of Arthur Cox (included in Exhibit 5.19).
23.21    Consent of Latham & Watkins (included in Exhibit 5.20).
23.22    Consent of Hergüner Bilgen Özeke Avukatlik Ortakliği (included in Exhibit 5.21).
23.23*    Consent of Hadef & Partners (included in Exhibit 5.22).
23.24    Consent of Dinsmore & Shohl LLP (included in Exhibit 5.23).
24    Powers of Attorney (included on the signatures pages hereof).
25.1    Statement of Eligibility of the Trustee on Form T-1 under the Trust Indenture Act.
99.1    Form of Letter of Transmittal.
99.2    Form of Notice of Guaranteed Delivery.
99.3    Form of Letter to DTC Participants.
99.4    Form of Letter to Beneficial Holders.

 

* To be filed by amendment.

 

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Undertakings

Each of the undersigned registrants hereby undertakes:

(1) to file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) to include any prospectus required by Section 10(a)(3) of the Securities Act of 1993;

(ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

(2) that, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof;

(3) to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering;

(4) to file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A.4 of Form 20–F at the start of any delayed offering or throughout a continuous offering;

(5) to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of a registrant pursuant to the foregoing provisions, or otherwise, each of the registrants has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by a registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, each of the registrants will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

 

II-41

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Pinafore Holdings B.V. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado on the 24th day of June, 2011.

 

PINAFORE HOLDINGS B.V.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Pinafore Holdings B.V.:

 

Signature      Title   Date

/s/ James Nicol

 

James Nicol

     

Director C

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

     

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Ryan Terrance Selwood

 

Ryan Terrance Selwood

      Director B   June 24, 2011

 

Anthony David Morgan

      Director B  

 

Konstantin Gilis

      Director A  

/s/ Donald West

 

Donald West

      Director A   June 24, 2011

/s/ Ronald Rosenboom

 

Ronald Rosenboom

      Director C   June 24, 2011

/s/ Edwin Denekamp

 

Edwin Denekamp

      Director C   June 24, 2011

/s/ Roelof Langelaar

 

Roelof Langelaar

      Director C   June 24, 2011

/s/ Pieter Hallebeek

 

Pieter Hallebeek

      Director C   June 24, 2011

/s/ Johan Haneveer

 

Johan Haneveer

      Director C   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, ACD Tridon (Holdings) Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

ACD TRIDON (HOLDINGS) LIMITED
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For ACD Tridon (Holdings) Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

Michael John Hopster

     

Director

(Principal Executive Officer)

   June 24, 2011

/s/ Elizabeth H. Lewzey

 

Elizabeth H. Lewzey

     

Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, ACD Tridon Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

ACD TRIDON INC.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Chief Financial Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For ACD Tridon Inc.:

 

Signature      Title   Date

/s/ David Carroll

 

David Carroll

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

 

     

Chief Financial Officer

(Principal Financial and Accounting

Officer)

   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

     

Authorized Representative in the United

States

   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Air System Components, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

AIR SYSTEM COMPONENTS, INC.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Air System Components, Inc.:

 

Signature      Title   Date

/s/ Gordon Jones

 

Gordon Jones

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

     

Vice President & CFO

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

      Director   June 24, 2011

/s/ Ronald L. Dewey

 

Ronald L. Dewey

      Director   June 24, 2011

/s/ Terry J. O’Halloran

 

Terry J. O’Halloran

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Air Systems Components Investments China Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

AIR SYSTEMS COMPONENTS INVESTMENTS CHINA LIMITED
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Air Systems Components Investments China Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

Michael John Hopster

     

Director

(Principal Executive Officer)

   June 24, 2011

/s/ Elizabeth H. Lewzey

 

Elizabeth H. Lewzey

     

Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, AMP Industrial Mexicana, S.A. de C.V. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

AMP INDUSTRIAL MEXICANA, S.A. DE C.V.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For AMP Industrial Mexicana, S.A. de C.V.:

 

Signature      Title   Date

/s/ Terry O’Halloran

 

Terry O’Halloran

     

Sole Director

(Principal Executive Officer)

   June 24, 2011

/s/ Ronald L. Dewey

 

Ronald L. Dewey

      (Principal Financial and Accounting Officer)   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Aplicadores Mexicanos, S.A. de C.V. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

APLICADORES MEXICANOS, S.A. DE C.V.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Aplicadores Mexicanos, S.A. de C.V.:

 

Signature      Title   Date

/s/ Gordon Jones

 

Gordon Jones

     

Sole Administrator

(Principal Executive Officer)

   June 24, 2011

/s/ Jon Muckley

 

Jon Muckley

      (Principal Financial and Accounting Officer)   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Aquatic Co. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

AQUATIC CO.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Aquatic Co.:

 

Signature      Title   Date

/s/ Gary Anderson

 

Gary Anderson

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

     

Vice President & CFO

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

      Director   June 24, 2011

/s/ Terry J. O’Halloran

 

Terry J. O’Halloran

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Aquatic Trucking Co. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

AQUATIC TRUCKING CO.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Aquatic Trucking Co.:

 

Signature      Title   Date

/s/ Gary Anderson

 

Gary Anderson

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

     

Vice President, Treasurer and Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Terry J. O’Halloran

 

Terry J. O’Halloran

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Auto Industrial de Partes, S.A. de C.V. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

AUTO INDUSTRIAL DE PARTES, S.A. DE C.V.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Auto Industrial de Partes, S.A. de C.V.:

 

Signature      Title   Date

/s/ Michael H. Reese

 

Michael H. Reese

     

Sole Administrator

(Principal Executive Officer)

   June 24, 2011

/s/ Brenda March

 

Brenda March

      (Principal Financial and Accounting Officer)   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Beta Naco Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

BETA NACO LIMITED
By:  

/s/ John W. Zimmerman                    

Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Beta Naco Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

Michael John Hopster

     

Director

(Principal Executive Officer)

   June 24, 2011

/s/ Elizabeth H. Lewzey

 

Elizabeth H. Lewzey

     

Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Manoj Kumar Shah

 

Manoj Kumar Shah

      Director   June 24, 2011

/s/ Thomas Robert Edwards

 

Thomas Robert Edwards

      Director   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, British Industrial Valve Company Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

BRITISH INDUSTRIAL VALVE COMPANY LIMITED
By:  

/s/ John W. Zimmerman                    

Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For British Industrial Valve Company Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

Michael John Hopster

     

Director

(Principal Executive Officer)

   June 24, 2011

/s/ Elizabeth H. Lewzey

 

Elizabeth H. Lewzey

     

Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Broadway Mississippi Development, LLC has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

BROADWAY MISSISSIPPI DEVELOPMENT, LLC

BY GATES DEVELOPMENT CORPORATION,

ITS SOLE MEMBER

By:  

/s/ John W. Zimmerman                    

Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Broadway Mississippi Development, LLC:

 

Signature      Title   Date

/s/ Thomas C. Reeve

 

Thomas C. Reeve

     

President and Director

(Principal Executive Officer) of Gates

Development Corporation, Sole

Member of Broadway Mississippi

Development, LLC

   June 24, 2011

/s/ Nicolas P. Wilkinson

 

Nicolas P. Wilkinson

     

Treasurer

(Principal Financial and Accounting

Officer) of Gates Development

Corporation, Sole Member of Broadway

Mississippi Development, LLC

   June 24, 2011

 

 

James Nicol

     

Director of Gates Development

Corporation, Sole Member of Broadway

Mississippi Development, LLC

  

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/s/ John W. Zimmerman

 

John W. Zimmerman

     

Director of Gates Development

Corporation, Sole Member of Broadway

Mississippi Development, LLC

   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Buffalo Holding Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

BUFFALO HOLDING COMPANY
By:  

/s/ John W. Zimmerman                    

Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Buffalo Holding Company:

 

Signature      Title   Date

/s/ Steven H. Lutz

 

Steven H. Lutz

     

Vice President & Group Controller and Director

(Principal Executive Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

     

Vice President & CFO and Director

(Principal Financial and Accounting Officer)

   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Carriage House Fruit Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

CARRIAGE HOUSE FRUIT COMPANY
By:  

/s/ John W. Zimmerman                    

Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Carriage House Fruit Company:

 

Signature      Title   Date

/s/ Daniel J. Disser

 

Daniel J. Disser

      (Principal Executive Officer)   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

      (Principal Financial and Accounting Officer)   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Conergics Corporation has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

CONERGICS CORPORATION
By:  

/s/ John W. Zimmerman                    

Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Conergics Corporation:

 

Signature      Title   Date

/s/ Daniel J. Disser

 

Daniel J. Disser

      (Principal Executive Officer)   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

      (Principal Financial and Accounting Officer)   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Dexter Axle Acquisition Corp. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

DEXTER AXLE ACQUISITION CORP.
By:  

/s/ John W. Zimmerman                    

Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Dexter Axle Acquisition Corp.:

 

Signature      Title   Date

/s/ Adam W. Dexter

 

Adam W. Dexter

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

     

Vice-President & Treasurer and Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Bernard J. Bolka

 

Bernard J. Bolka

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Dexter Axle Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

DEXTER AXLE COMPANY
By:  

/s/ John W. Zimmerman                    

Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Dexter Axle Company:

 

Signature      Title   Date

/s/ Adam W. Dexter

 

Adam W. Dexter

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

     

Vice President & CFO

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Bernard J. Bolka

 

Bernard J. Bolka

      Director   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Dexter Axle Trucking Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

DEXTER AXLE TRUCKING COMPANY
By:  

/s/ John W. Zimmerman                    

Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Dexter Axle Trucking Company:

 

Signature      Title   Date

/s/ Adam W. Dexter

 

Adam W. Dexter

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ Bernard J. Bolka

 

Bernard J. Bolka

     

Vice President, Finance and Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Dexter Chassis Group, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

DEXTER CHASSIS GROUP, INC.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Dexter Chassis Group, Inc.:

 

Signature      Title   Date

/s/ Adam W. Dexter

 

Adam W. Dexter

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

     

Vice President & CFO

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Bernard J. Bolka

 

Bernard J. Bolka

      Director   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, E Industries, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

E INDUSTRIES, INC.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For E Industries, Inc.:

 

Signature      Title   Date

/s/ Matthew J. Eppers

 

Matthew J. Eppers

     

President

(Principal Executive Officer)

   June 24, 2011

/s/ Bernard J. Bolka

 

Bernard J. Bolka

     

Vice President, Finance and Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Adam W. Dexter

 

Adam W. Dexter

      Director   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Eastern Sheet Metal, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

EASTERN SHEET METAL, INC.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Eastern Sheet Metal, Inc.:

 

Signature      Title   Date

/s/ William K. Stout, Jr.

 

William K. Stout, Jr.

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

     

Vice President & CFO

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

      Director   June 24, 2011

/s/ Thomas R. Edwards

 

Thomas R. Edwards

      Director   June 24, 2011

/s/ Jeffrey D. Leonard

 

Jeffrey D. Leonard

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Eifeler Maschinenbau GmbH has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado on the 24th day of June, 2011.

 

EIFELER MASCHINENBAU GMBH
By:   /s/ Heiner Schmitz                    
Name:   Heiner Schmitz
Title:   Managing Director

 

By:   /s/ John Weston                    
Name:   John Weston
Title:   Managing Director

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Heiner Schmitz and John Weston and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Eifeler Maschinenbau GmbH:

 

Signature      Title   Date

/s/ Heiner Schmitz

 

Heiner Schmitz

     

Managing Director

(Principal Executive Officer)

   June 24, 2011

/s/ Guenther Sief

 

Guenther Sief

      (Principal Financial and Accounting Officer)   June 24, 2011

/s/ John Weston

 

John Weston

      Managing Director   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, EPICOR Industries, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

EPICOR INDUSTRIES, INC.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For EPICOR Industries, Inc.:

 

Signature      Title   Date

/s/ Michael H. Reese

 

Michael H. Reese

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

 

John W. Zimmerman

     

Vice President & CFO

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

      Director   June 24, 2011

/s/ Steven H. Lutz

 

Steven H. Lutz

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, FBN Transportation, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

FBN TRANSPORTATION, INC.
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For FBN Transportation, Inc:

 

Signature      Title   Date

/s/ William K. Stout, Jr.

 

William K. Stout, Jr.

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ Daniel J. Disser

 

Daniel J. Disser

     

Vice-President & Treasurer and Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Thomas R. Edwards

 

Thomas R. Edwards

      Director   June 24, 2011

/s/ Jeffrey D. Leonard

 

Jeffrey D. Leonard

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Auto Parts Holdings China Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES AUTO PARTS HOLDINGS CHINA LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Auto Parts Holdings China Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

Michael John Hopster

     

Director

(Principal Executive Officer)

   June 24, 2011

/s/ Alan J. Power

 

Alan J. Power

     

Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates CIS LLC has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES CIS LLC
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates CIS LLC:

 

Signature      Title   Date

/s/ Piergiorgio Brusco

 

Piergiorgio Brusco

     

Director

(Principal Executive Officer)

   June 24, 2011

/s/ William Allen

 

William Allen

      (Principal Financial and Accounting Officer)   June 24, 2011

/s/ Peter Verdonckt

 

Peter Verdonckt

      Director and General Manager   June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Development Corporation has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES DEVELOPMENT CORPORATION
By:   /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Development Corporation:

 

Signature      Title   Date

/s/ Thomas C. Reeve

 

Thomas C. Reeve

     

President and Director

(Principal Executive Officer)

   June 24, 2011

/s/ Nicolas P. Wilkinson

 

Nicolas P. Wilkinson

     

Treasurer

(Principal Financial and Accounting Officer)

   June 24, 2011

 

 

James Nicol

 

      Director  

/s/ John W. Zimmerman

 

John W. Zimmerman

      Director   June 24, 2011

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Engineering & Services Australia Pty Ltd ACN 142 531 244 has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES ENGINEERING & SERVICES

AUSTRALIA PTY LTD ACN 142 531 244

By:  

/s/ John W. Zimmerman                    

Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Engineering & Services Australia Pty Ltd ACN 142 531 244:

 

Signature      Title   Date

/s/ Peter King

 

Peter King

     

Director

(Principal Executive Officer)

  

/s/ Robert Clifford Edlund

 

Robert Clifford Edlund

     

Director

(Principal Financial and Accounting Officer)

  

/s/ Thomas C. Reeve

 

Thomas C. Reeve

      Authorized Representative in the United States  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Engineering & Services Hamriyah FZE has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado on the 24th day of June, 2011.

 

GATES ENGINEERING & SERVICES HAMRIYAH FZE
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Engineering & Services Hamriyah FZE:

 

Signature      Title   Date

/s/ Kenneth Brown

 

      Managing Director   June 24, 2011

Kenneth Brown

      (Principal Executive Officer)  

/s/ Steven Meyer

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Stephen Meyer       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Engineering & Services FZCO has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES ENGINEERING & SERVICES FZCO
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Engineering & Services FZCO:

 

Signature      Title   Date

/s/ Kenneth Brown

 

      (Principal Executive Officer)   June 24, 2011

Kenneth Brown

       

/s/ Steven Meyer

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Stephen Meyer       

/s/ Nitin Kaul

 

      Director   June 24, 2011
Nitin Kaul       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Engineering & Services Ltd. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES ENGINEERING & SERVICES LTD.
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title: Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Engineering & Services Ltd.:

 

Signature      Title   Date

/s/ John Weston

 

      Director   June 24, 2011

John Weston

      (Principal Executive Officer)  

/s/ Ross G. Bratlee

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Ross G. Bratlee       

/s/ Robert S. Albery

 

      Director   June 24, 2011
Robert S. Albery       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Engineering & Services UK Holdings Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES ENGINEERING & SERVICES UK HOLDINGS LIMITED
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Engineering & Services UK Holdings Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011

Michael John Hopster

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Fleximak Ltd. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES FLEXIMAK LTD.
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Fleximak Ltd.:

 

Signature      Title   Date

/s/ John Weston

 

      Director   June 24, 2011

John Weston

      (Principal Executive Officer)  

/s/ Ross G. Bratlee

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Ross G. Bratlee       

/s/ Robert S. Albery

 

      Director   June 24, 2011
Robert S. Albery       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Fluid Power Technologies Investments Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES FLUID POWER TECHNOLOGIES INVESTMENTS LIMITED
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Fluid Power Technologies Investments Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011

Michael John Hopster

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Güç Aktarim Sistemleri Dagitim Sanayi ve Ticaret Limited Sirketi has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES GÜÇ AKTARIM SISTEMLERI DAGITIM

SANAYI VE TICARET LIMITED SIRKETI

By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Güç Aktarim Sistemleri Dagitim Sanayi ve Ticaret Limited Sirketi:

 

Signature      Title   Date

/s/ Ionut Stefan

 

      Manager   June 24, 2011
Ionut Stefan      (Principal Executive Officer)  

/s/ Vildan Gohdeniz

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Vildan Gohdeniz       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Holding GmbH has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES HOLDING GMBH
By:   /s/ Heiner Schmitz                    
Name: Heiner Schmitz
Title:   Managing Director

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Heiner Schmitz and John Weston and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Holding GmbH:

 

Signature      Title   Date

/s/ Heiner Schmitz

 

      Managing Director   June 24, 2011
Heiner Schmitz      (Principal Executive Officer)  

/s/ Ross G. Bratlee

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Ross G. Bratlee       

/s/ John Weston

 

      Managing Director   June 24, 2011
John Weston       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Holdings Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES HOLDINGS LIMITED

By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Holdings Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates International Holdings, LLC has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES INTERNATIONAL HOLDINGS, LLC

BY THE GATES CORPORATION, ITS SOLE MEMBER

By:   /s/ John W. Zimmerman
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates International Holdings, LLC:

 

Signature    Title   Date

/s/ James Nicol

James Nicol

   

Chief Executive Officer and Director of

The Gates Corporation, Sole Member of

Gates International Holdings, LLC

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

John W. Zimmerman

   

Chief Financial Officer and Director of

The Gates Corporation, Sole Member of

Gates International Holdings, LLC

(Principal Financial and Accounting

Officer)

   June 24, 2011

/s/ Shane Darren Feeney

    Director of The Gates Corporation, Sole   June 24, 2011
Shane Darren Feeney   

Member of Gates International

Holdings, LLC

  

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/s/ Konstantin Gilis

    Director of The Gates Corporation, Sole   June 24, 2011
Konstantin Gilis   

Member of Gates International

Holdings, LLC

  

 

Serge Gouin

   

Director of The Gates Corporation, Sole

Member of Gates International

Holdings, LLC

  

 

Johann Koss

   

Director of The Gates Corporation, Sole

Member of Gates International

Holdings, LLC

  

 

Seth Mitchell Mersky

   

Director of The Gates Corporation, Sole

Member of Gates International

Holdings, LLC

  

/s/ Anthony David Morgan

    Director of The Gates Corporation, Sole   June 24, 2011
Anthony David Morgan   

Member of Gates International

Holdings, LLC

  

 

Anthony Munk

   

Director of The Gates Corporation, Sole

Member of Gates International

Holdings, LLC

  

/s/ Alan J. Power

    Director of The Gates Corporation, Sole   June 24, 2011
Alan J. Power   

Member of Gates International

Holdings, LLC

  

 

Chris Patterson

   

Director of The Gates Corporation, Sole

Member of Gates International

Holdings, LLC

  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Mectrol GmbH has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado on the 24th day of June, 2011.

 

GATES MECTROL GMBH
By:    /s/ Piergiorgio Brusco                    
Name:   Piergiorgio Brusco

Title:

   Managing Director

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Piergiorgio Brusco and Georgios Korominas and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Mectrol GmbH:

 

Signature      Title   Date

/s/ Piergiorgio Brusco

 

      Managing Director   June 24, 2011
Piergiorgio Brusco      (Principal Executive Officer)  

/s/ Ross G. Bratlee

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Ross G. Bratlee       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Mectrol, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES MECTROL, INC.
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Mectrol, Inc.:

 

Signature      Title   Date

/s/ Patricia W. Warfield

 

      President   June 24, 2011

Patricia W. Warfield

      (Principal Executive Officer)  

/s/ Peter C. Lynch

 

      Chief Financial Officer   June 24, 2011
Peter C. Lynch      (Principal Financial and Accounting Officer)  

/s/ Kenneth S. Friedman

 

      Director   June 24, 2011
Kenneth S. Friedman       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Power Transmission Europe BVBA has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado on the 24th day of June, 2011.

 

GATES POWER TRANSMISSION EUROPE BVBA
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Power Transmission Europe BVBA:

 

Signature      Title   Date

/s/ Piergiorgio Brusco

 

      Manager   June 24, 2011

Piergiorgio Brusco

      (Principal Executive Officer)  

/s/ William Allen

 

      Manager   June 24, 2011
William Allen      (Principal Financial and Accounting Officer)  

/s/ Peter Verdonckt

 

      Manager   June 24, 2011
Peter Verdonckt       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Powertrain Plastik Metal ve Makina Sanayii Veticaret Limited Sirketi has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES POWERTRAIN PLASTIK METAL VE

MAKINA SANAYII VETICARET LIMITED

SIRKETI

By:   /s/ John W. Zimmerman
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Powertrain Plastik Metal ve Makina Sanayii Veticaret Limited Sirketi:

 

Signature      Title   Date

/s/ Ionut Stefan

 

      Manager   June 24, 2011

Ionut Stefan

      (Principal Executive Officer)  

/s/ Vildan Gohdeniz

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Vildan Gohdeniz       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Gates Powertrain UK Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GATES POWERTRAIN UK LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Gates Powertrain UK Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011

Michael John Hopster

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Glass Master Corporation has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

GLASS MASTER CORPORATION
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Glass Master Corporation:

 

Signature      Title   Date

/s/ Thomas R. Edwards

 

      Chief Executive Officer, President and Director   June 24, 2011

Thomas R. Edwards

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Jeffrey D. Leonard

 

      Director   June 24, 2011
Jeffrey D. Leonard       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, H Heaton Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

H HEATON LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For H Heaton Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011

Michael John Hopster

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011

Thomas C. Reeve

       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Hart & Cooley Trucking Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

HART & COOLEY TRUCKING COMPANY
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title: Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Hart & Cooley Trucking Company:

 

Signature      Title   Date

/s/ Terry J. O’Halloran

 

      President and Director   June 24, 2011
Terry J. O’Halloran      (Principal Executive Officer)  

/s/ Daniel J. Disser

 

      Vice President, Treasurer and Director   June 24, 2011
Daniel J. Disser      (Principal Financial and Accounting Officer)  

/s/ Ronald L. Dewey

 

      Director   June 24, 2011
Ronald L. Dewey       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Hart & Cooley, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

HART & COOLEY, INC.
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Hart & Cooley, Inc.:

 

Signature      Title   Date

/s/ Terry J. O’Halloran

 

      President and Director   June 24, 2011

Terry J. O’Halloran

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Ronald L. Dewey

 

      Director   June 24, 2011
Ronald L. Dewey       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Hytec, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

HYTEC, INC.
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Hytec, Inc.:

 

Signature      Title   Date

/s/ Gary Anderson

 

      President and Director   June 24, 2011

Gary Anderson

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Terry J. O’Halloran

 

      Director   June 24, 2011
Terry J. O’Halloran       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Ideal Clamp Products, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

IDEAL CLAMP PRODUCTS, INC.
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Ideal Clamp Products, Inc.:

 

Signature      Title   Date

/s/ Michael H. Reese

 

      President and Director   June 24, 2011

Michael H. Reese

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Steven H. Lutz

 

      Director   June 24, 2011
Steven H. Lutz       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Koch Filter Corporation has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

KOCH FILTER CORPORATION
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Koch Filter Corporation:

 

Signature      Title   Date

/s/ Gordon Jones

 

      President and Director   June 24, 2011

Gordon Jones

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

 

      Director  
John Koch       

/s/ Ronald L. Dewey

 

      Director   June 24, 2011
Ronald L. Dewey       

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/s/ Terry J. O’Halloran

 

      Director   June 24, 2011
Terry J. O’Halloran       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Montisk Investments Netherlands C.V. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg, on the 24th day of June, 2011.

 

MONTISK INVESTMENTS NETHERLANDS C.V.

BY TOMKINS INVESTMENTS COMPANY

S.À R.L., ITS GENERAL PARTNER

By:  

/s/ Geraldine Cassells

Name:   Geraldine Cassells
Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Montisk Investments Netherlands C.V.:

 

Signature    Title   Date

/s/ Geraldine Cassells

 

Geraldine Cassells

   

Manager of Tomkins Investments Company

S.à r.l., its General Partner

(Principal Executive Officer and Principal

Financial and Accounting Officer)

  

June 24, 2011

 

 

/s/ Theodore Schartz

 

Theodore Schartz

   

Manager of Tomkins Investments Company

S.à r.l., its General Partner

  

June 24, 2011

 

Siran Samarasinghe

   

Manager of Tomkins Investments Company

S.à r.l., its General Partner

  

 

Robert Verdonk

   

Manager of Tomkins Investments Company

S.à r.l., its General Partner

  

/s/ Malcolm Swain

 

Malcolm Swain

   

Manager of Tomkins Investments Company

S.à r.l., its General Partner

  

June 24, 2011

/s/ Thomas C. Reeve

 

Thomas C. Reeve

   

Authorized Representative in the United States

 

  

June 24, 2011

 

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, National Duct Systems, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

NATIONAL DUCT SYSTEMS, INC.
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For National Duct Systems, Inc.:

 

Signature      Title   Date

/s/ William K. Stout, Jr.

 

      President   June 24, 2011

William K. Stout, Jr.

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Thomas R. Edwards

 

      Director   June 24, 2011
Thomas R. Edwards       

/s/ Jeffrey D. Leonard

 

      Director   June 24, 2011
Jeffrey D. Leonard       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, NRG Industries, Inc. (Delaware Entity) has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

NRG INDUSTRIES, INC. (DELAWARE ENTITY)
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For NRG Industries, Inc. (Delaware Entity):

 

Signature      Title   Date

/s/ Thomas R. Edwards

 

      Chief Executive Officer, President and Director   June 24, 2011

Thomas R. Edwards

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Jeffrey D. Leonard

 

      Director   June 24, 2011
Jeffrey D. Leonard       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, NRG Industries, Inc. (Texas Entity) has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

NRG INDUSTRIES, INC. (TEXAS ENTITY)
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For NRG Industries, Inc. (Texas Entity):

 

Signature      Title   Date

/s/ Thomas R. Edwards

 

      Chief Executive Officer, President and Director   June 24, 2011

Thomas R. Edwards

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Jeffrey D. Leonard

 

      Director   June 24, 2011
Jeffrey D. Leonard       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Olympus (Ormskirk) Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

OLYMPUS (ORMSKIRK) LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Olympus (Ormskirk) Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011

Michael John Hopster

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Rooftop Systems, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

ROOFTOP SYSTEMS, INC.
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Rooftop Systems, Inc.:

 

Signature      Title   Date

/s/ Thomas R. Edwards

 

      Chief Executive Officer, President and Director   June 24, 2011

Thomas R. Edwards

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Jeffrey D. Leonard

 

      Director   June 24, 2011
Jeffrey D. Leonard       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Ruskin Air Management Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

RUSKIN AIR MANAGEMENT LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Ruskin Air Management Limited:

 

Signature      Title   Date

/s/ Kevin John Munson

 

      Director   June 24, 2011

Kevin John Munson

      (Principal Executive Officer)  

/s/ Andrew McKay

 

      Director   June 24, 2011
Andrew McKay      (Principal Financial and Accounting Officer)  

/s/ Thomas R. Edwards

 

      Director   June 24, 2011
Thomas R. Edwards       

/s/ Manoj Kumar Shah

 

      Director   June 24, 2011
Manoj Kumar Shah       

/s/ David Peter Fitzpatrick

 

      Director   June 24, 2011
David Peter Fitzpatrick       

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/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Ruskin Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

RUSKIN COMPANY
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Ruskin Company:

 

Signature      Title   Date

/s/ Thomas R. Edwards

 

      Chief Executive Officer, President and   June 24, 2011

Thomas R. Edwards

     

Director

(Principal Executive Officer)

  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman     

(Principal Financial and Accounting

Officer)

  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Jeffrey D. Leonard

 

      Director   June 24, 2011
Jeffrey D. Leonard       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Ruskin Company Canada Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

RUSKIN COMPANY CANADA INC.
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Ruskin Company Canada Inc.:

 

Signature      Title   Date

/s/ Thomas R. Edwards

 

     

(Principal Executive Officer)

   June 24, 2011

Thomas R. Edwards

       

/s/ Jeffrey Leonard

 

      (Principal Financial and Accounting   June 24, 2011
Jeffrey Leonard      Officer)  

/s/ David Carroll

 

      Director   June 24, 2011
David Carroll       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United   June 24, 2011
Thomas C. Reeve      States  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Ruskin de Mexico, S.A. de C.V. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

RUSKIN DE MEXICO, S.A. DE C.V.
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Ruskin de Mexico, S.A. de C.V.:

 

Signature      Title   Date

/s/ Thomas R. Edwards

 

      Sole Administrator   June 24, 2011

Thomas R. Edwards

      (Principal Executive Officer)  

/s/ Jeffrey Leonard

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Jeffrey Leonard       

/s/ Thomas C. Reeve

 

      Secretary and Authorized Representative in the   June 24, 2011
Thomas C. Reeve      United States  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Ruskin Service Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

RUSKIN SERVICE COMPANY
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Ruskin Service Company:

 

Signature      Title   Date

/s/ Thomas R. Edwards

 

      Chief Executive Officer, President and Director   June 24, 2011

Thomas R. Edwards

      (Principal Executive Officer)  

/s/ Daniel J. Disser

 

      Vice President, Treasurer and Director (Principal   June 24, 2011
Daniel J. Disser     

Financial and Accounting

Officer)

  

/s/ Jeffrey D. Leonard

 

      Director   June 24, 2011
Jeffrey D. Leonard       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Schrader Electronics Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SCHRADER ELECTRONICS LIMITED
By:   /s/ John W. Zimmerman
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Schrader Electronics Limited:

 

Signature    Title   Date

/s/Thomas David Stephen McClelland

Thomas David Stephen McClelland

   

Director (Principal Executive Officer)

   June 24, 2011

/s/ Graeme Martin Thompson

Graeme Martin Thompson

   

Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Michael John Hopster

    Director   June 24, 2011
Michael John Hopster     

/s/ Thomas C. Reeve

    Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve     

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Schrader Electronics, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SCHRADER ELECTRONICS, INC.
By: /s/ John W. Zimmerman                    
Name:  John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Schrader Electronics, Inc.:

 

Signature      Title   Date

/s/ Thomas David Stephen McClelland

 

      Chief Executive, President and Director   June 24, 2011

Thomas David Stephen McClelland

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman     

(Principal Financial and Accounting

Officer)

  

/s/ Hugh W. Charvat

 

      Director   June 24, 2011
Hugh W. Charvat       

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Hugh W. Charvat       

/s/ Steven H. Lutz

 

      Director   June 24, 2011
Steven H. Lutz       

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/s/ Graeme M. Thompson

 

      Director   June 24, 2011
Graeme M. Thompson       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Schrader International Brasil Ltda. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado on the 24th day of June, 2011.

 

SCHRADER INTERNATIONAL BRASIL LTDA.
By:  /s/ Richard Hoffner                    
Name: Richard Hoffner
Title:   Managing Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Richard Hoffner and Steven H, Lutz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Schrader International Brasil Ltda.:

 

Signature      Title   Date

/s/ Richard Hoffner

 

      Managing Officer   June 24, 2011

Richard Hoffner

      (Principal Executive Officer)  

/s/ Steven H. Lutz

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Steven H. Lutz       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Schrader International Holding Co. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SCHRADER INTERNATIONAL HOLDING CO.
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Schrader International Holding Co.:

 

Signature      Title   Date

/s/ Alan J. Power

 

      President and Chief Executive Officer   June 24, 2011

Alan J. Power

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman     

(Principal Financial and Accounting

Officer)

  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Schrader Investments Luxembourg S.à r.l. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg on the 24th day of June, 2011.

 

SCHRADER INVESTMENTS LUXEMBOURG S.À R.L.
By: /s/ Geraldine Cassells                    
Name: Geraldine Cassells
Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Schrader Investments Luxembourg S.à r.l.:

 

Signature      Title   Date

/s/ Geraldine Cassells

 

      Manager   June 24, 2011

Geraldine Cassells

     

(Principal Executive Officer and Principal

Financial and Accounting Officer)

  

/s/ Theodore Schartz

 

      Manager   June 24, 2011
Theodore Schartz       

 

      Manager  
Robert Verdonk       

 

      Manager  
Siran Samarasinghe       

/s/ Malcolm Swain

 

      Manager   June 24, 2011
Malcolm Swain       

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/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Schrader, LLC has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SCHRADER, LLC
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Schrader, LLC:

 

Signature      Title   Date

/s/ Jean-Michel Bolmont

 

      President & Assistant Secretary and   June 24, 2011

Jean-Michel Bolmont

     

Director

(Principal Executive Officer)

  

/s/ Daniel J. Disser

 

      Vice President and Treasurer   June 24, 2011
Daniel J. Disser     

(Principal Financial and Accounting

Officer)

  

/s/ Steven H. Lutz

 

      Director   June 24, 2011
/ Steven H. Lutz       

 

      Director  
Alan J. Power       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Schrader-Bridgeport International, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SCHRADER-BRIDGEPORT

INTERNATIONAL, INC.

By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Schrader-Bridgeport International, Inc.:

 

Signature      Title   Date

/s/ Hugh Charvat

 

      Chairman & Director   June 24, 2011
Hugh Charvat      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman     

(Principal Financial and Accounting

Officer)

  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

 

      Director  
Steven H. Lutz       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Selkirk Americas, L.P. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SELKIRK AMERICAS, L.P.
BY TOMKINS ENGINEERING LIMITED,
ITS GENERAL PARTNER
By:   /s/ John W. Zimmerman                    

Name: John W. Zimmerman

Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Selkirk Americas, L.P.:

 

Signature      Title   Date

/s/ Michael J. Hopster

 

      Director   June 24, 2011
Michael J. Hopster      (Principal Executive Officer) of Tomkins Engineering Limited, General Partner of Selkirk Americas, L.P.  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer) of Tomkins Engineering Limited, General Partner of Selkirk Americas, L.P.  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Selkirk Canada Holdings, L.P. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SELKIRK CANADA HOLDINGS, L.P.
BY SELKIRK IP LLC,
ITS GENERAL PARTNER
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Selkirk Canada Holdings, L.P.:

 

Signature    Title   Date

/s/ Terry J. O’Halloran

 

    Chief Executive Officer and Manager   June 24, 2011
Terry J. O’Halloran   

(Principal Executive Officer) of Selkirk

IP LLC, General Partner of Selkirk

Canada Holdings, L.P.

  

/s/ John W. Zimmerman

 

    Vice President & CFO   June 24, 2011
John W. Zimmerman   

(Principal Financial and Accounting

Officer) of Selkirk IP LLC, General

Partner of Selkirk Canada Holdings,

L.P.

  

 

    Manager of Selkirk IP LLC, General  
Daniel J. Disser   

Partner of Selkirk Canada Holdings,

L.P.

  

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/s/ Ronald L. Dewey

 

    Manager of Selkirk IP LLC, General   June 24, 2011
Ronald L. Dewey   

Partner of Selkirk Canada Holdings,

L.P.

  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Selkirk Corporation has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SELKIRK CORPORATION

By: /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Selkirk Corporation:

 

Signature      Title   Date

/s/ Terry J. O’Halloran

 

      Chief Executive Officer and Director   June 24, 2011

Terry J. O’Halloran

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting  
     Officer)  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

/s/ Ronald L. Dewey

 

      Director   June 24, 2011
Ronald L. Dewey       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Selkirk IP L.L.C. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SELKIRK IP L.L.C.

BY SELKIRK AMERICAS, L.P., ITS SOLE

MEMBER

By: /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Selkirk IP L.L.C.:

 

Signature      Title   Date

/s/ Terry J. O’Halloran

 

      Chief Executive Officer and Manager   June 24, 2011

Terry J. O’Halloran

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting  
     Officer)  

 

      Manager  
Daniel J. Disser       

/s/ Ronald L. Dewey

 

      Manager   June 24, 2011
Ronald L. Dewey       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Shiitake Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SHIITAKE LIMITED

By: /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Shiitake Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011

Michael John Hopster

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Stackpole Investments Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

STACKPOLE INVESTMENTS LIMITED
By:  /s/ John W. Zimmerman                    
Name:  John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Stackpole Investments Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011

Michael John Hopster

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Swindon Silicon Systems Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

SWINDON SILICON SYSTEMS LIMITED
By:  /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Swindon Silicon Systems Limited:

 

Signature      Title   Date

/s/ Geoffrey Michael Hall

 

      Director   June 24, 2011

Geoffrey Michael Hall

      (Principal Executive Officer)  

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Financial and Accounting Officer)  

/s/ Clive John Bunney

 

      Director   June 24, 2011

Clive John Bunney

 

       

/s/ Thomas C. Reeve

 

     

Authorized Representative in the United States

  

June 24, 2011

Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, The Gates Corporation has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

THE GATES CORPORATION
By:   /s/ John W. Zimmerman
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For The Gates Corporation:

 

Signature    Title   Date

/s/ James Nicol

James Nicol

   

Chief Executive Officer and Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

John W. Zimmerman

   

Chief Financial Officer and Director

(Principal Financial and Accounting

Officer)

   June 24, 2011

/s/ Shane Darren Feeney

    Director   June 24, 2011
Shane Darren Feeney     

/s/ Konstantin Gilis

    Director   June 24, 2011
Konstantin Gilis     

 

Serge Gouin

    Director  

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Johann Koss

    Director  

 

Seth Mitchell Mersky

   

Director

  

/s/ Anthony David Morgan

    Director   June 24, 2011
Anthony David Morgan     

 

Tony Munk

    Director  

/s/ Alan J. Power

    Director   June 24, 2011
Alan J. Power     

 

Chris Patterson

    Director  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Acquisitions Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS ACQUISITIONS LIMITED
By:   /s/ John W. Zimmerman
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Acquisitions Limited:

 

Signature    Title   Date

/s/ Alan J. Power

Alan J. Power

   

Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

John W. Zimmerman

   

Director

(Principal Financial and Accounting Officer)

   June 24, 2011

/s/ Ryan Terrance Selwood

    Director   June 24, 2011
Ryan Terrance Selwood     

 

    Director  
Shane Darren Feeney     

 

Samuel Blaichman

    Director  

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    Director  
Anthony David Morgan     

/s/ Konstantin Gilis

    Director   June 24, 2011
Konstantin Gilis     

 

Seth Mitchell Mersky

    Director  

/s/ Todd Michael Clegg

    Director   June 24, 2011
Todd Michael Clegg     

/s/ Matthew Ross

    Director   June 24, 2011
Matthew Ross     

/s/ Thomas C. Reeve

    Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve     

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins American Investments S.à r.l. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg on the 24th day of June, 2011.

 

TOMKINS AMERICAN INVESTMENTS S.À R.L.
By:  /s/ Geraldine Cassells                    
Name: Geraldine Cassells
Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins American Investments S.à r.l.:

 

Signature      Title   Date

/s/ Geraldine Cassells

 

      Manager   June 24, 2011

Geraldine Cassells

     

(Principal Executive Officer and Principal

Financial and Accounting Officer)

  

/s/ Theodore Schartz

 

      Manager   June 24, 2011
Theodore Schartz       

 

      Manager  

Robert Verdonk

 

       

/s/ Malcolm Swain

 

     

Manager

  

June 24, 2011

Malcolm Swain       

 

/s/ Thomas C. Reeve

 

     

Authorized Representative in the United States

  

June 24, 2011

Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Automotive Canada Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS AUTOMOTIVE CANADA LIMITED
By:  /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Chief Financial Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Automotive Canada Limited:

 

Signature      Title   Date

/s/ Alan J. Power

 

      Director   June 24, 2011

/s/ Alan J. Power

      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Chief Financial Officer   June 24, 2011
John W. Zimmerman     

(Principal Financial and Accounting

Officer)

  

/s/ David Carroll

 

      Director   June 24, 2011

David Carroll

 

       

/s/ Thomas C. Reeve

 

     

Authorized Representative in the United

  

June 24, 2011

Thomas C. Reeve      States  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Automotive Company, S.à r.l. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg on the 24th day of June, 2011.

 

TOMKINS AUTOMOTIVE COMPANY, S.À R.L.
By: /s/ Geraldine Cassells                    
Name:  Geraldine Cassells
Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Automotive Company, S.à r.l.:

 

Signature      Title   Date

/s/ Geraldine Cassells

 

      Manager   June 24, 2011

Geraldine Cassells

      (Principal Executive Officer and Principal  
     Financial and Accounting Officer)  

/s/ Theodore Schartz

 

      Manager   June 24, 2011
Theodore Schartz       

 

      Manager  
Siran Samarasinghe       

 

      Manager  
Robert Verdonk       

/s/ Malcolm Swain

 

      Manager   June 24, 2011
Malcolm Swain       

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/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Automotive Holding Co. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS AUTOMOTIVE HOLDING CO.
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Automotive Holding Co.:

 

Signature      Title   Date

/s/ Alan J. Power

 

      (Principal Executive Officer)   June 24, 2011
Alan J. Power       

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011

John W. Zimmerman

     

(Principal Financial and Accounting

Officer)

  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Building Products, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS BUILDING PRODUCTS, INC.
By:   /s/ John W. Zimmerman
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Building Products, Inc.:

 

Signature    Title   Date

/s/ James Nicol

James Nicol

   

Director

(Principal Executive Officer)

   June 24, 2011

/s/ John W. Zimmerman

John W. Zimmerman

   

Director & CFO

(Principal Financial and Accounting

Officer)

   June 24, 2011

/s/ Shane Darren Feeney

    Director   June 24, 2011
Shane Darren Feeney     

/s/ Konstantin Gilis

    Director   June 24, 2011
Konstantin Gilis     

/s/ Anthony David Morgan

    Director   June 24, 2011
Anthony David Morgan     

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Anthony Munk

    Director  

 

Philip Orsino

    Director  

 

Michael Mangan

    Director  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Engineering Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS ENGINEERING LIMITED

By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Engineering Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Finance Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS FINANCE LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Finance Limited:

 

Signature      Title   Date

/s/ John W. Zimmerman

 

      Director   June 24, 2011

John W. Zimmerman

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Finance Luxembourg Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS FINANCE LUXEMBOURG LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Finance Luxembourg Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011

Michael John Hopster

      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Funding Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS FUNDING LIMITED
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Funding Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Holdings Luxembourg, S.à r.l. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg on the 24th day of June, 2011.

 

TOMKINS HOLDINGS LUXEMBOURG, S.À R.L.
By: /s/ Geraldine Cassells                    
Name: Geraldine Cassells
Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Holdings Luxembourg, S.à r.l.:

 

Signature      Title   Date

/s/ Geraldine Cassells

 

      Manager   June 24, 2011
Geraldine Cassells      (Principal Executive Officer and Principal Financial and Accounting Officer)  

/s/ Theodore Schartz

 

      Manager   June 24, 2011
Theodore Schartz       

 

 

      Manager  
Siran Samarasinghe       

 

 

      Manager  
Robert Verdonk       

/s/ Malcolm Swain

 

      Manager   June 24, 2011
Malcolm Swain       

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/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Ideal Clamps (Suzhou) Investments Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS IDEAL CLAMPS (SUZHOU) INVESTMENTS LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Ideal Clamps (Suzhou) Investments Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Industries, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS INDUSTRIES, INC.
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Industries, Inc.:

 

Signature      Title   Date

/s/ Terry J. O’Halloran

 

      Director   June 24, 2011
Terry J. O’Halloran      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      CFO and Director   June 24, 2011
John W. Zimmerman     

(Principal Financial and Accounting

Officer)

  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Investments China Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS INVESTMENTS CHINA LIMITED
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Investments China Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Investments Company S.à r.l. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg on the 24th day of June, 2011.

 

TOMKINS INVESTMENTS COMPANY S.À R.L.
By:   /s/ Geraldine Cassells                    
Name: Geraldine Cassells
Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Investments Company S.à r.l.:

 

Signature    Title   Date

/s/ Geraldine Cassells

 

    Manager   June 24, 2011
Geraldine Cassells    (Principal Executive Officer and Principal Financial and Accounting Officer)  

/s/ Theodore Schartz

 

    Manager   June 24, 2011
Theodore Schartz     

 

 

    Manager  
Siran Samarasinghe     

 

 

    Manager  
Robert Verdonk     

/s/ Malcolm Swain

 

    Manager   June 24, 2011
Malcolm Swain     

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/s/ Thomas C. Reeve

 

    Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve     

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Investments Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS INVESTMENTS LIMITED
By: /s/ John W. Zimmerman                  
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Investments Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS LIMITED
By:   /s/ John W. Zimmerman
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Limited:

 

Signature    Title   Date

/s/ John W. Zimmerman

John W. Zimmerman

   

(Principal Executive Officer)

   June 24, 2011

/s/ Elizabeth H. Lewzey

    (Principal Financial and Accounting Officer)   June 24, 2011
Elizabeth H. Lewzey     

/s/ Todd Michael Clegg

    Director   June 24, 2011
Todd Michael Clegg     

/s/ Ryan Terrance Selwood

    Director   June 24, 2011
Ryan Terrance Selwood     

/s/ Shane Darren Feeney

    Director   June 24, 2011
Shane Darren Feeney     

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Samuel Blaichman

    Director  

/s/ Konstantin Gilis

    Director   June 24, 2011
Konstantin Gilis     

 

Seth Mitchell Mersky

    Director  

/s/ Anthony David Morgan

    Director   June 24, 2011
Anthony David Morgan     

/s/ Matthew Ross

    Director   June 24, 2011
Matthew Ross     

/s/ Thomas C. Reeve

    Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve     

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Luxembourg S.à r.l. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg on the 24th day of June, 2011.

 

TOMKINS LUXEMBOURG S.À R.L.
By:   /s/ Geraldine Cassells                    
Name: Geraldine Cassells
Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Luxembourg S.à r.l.:

 

Signature      Title   Date

/s/ Geraldine Cassells

 

      Manager   June 24, 2011
Geraldine Cassells     

(Principal Executive Officer and Principal

Financial and Accounting Officer)

  

/s/ Theodore Schartz

 

      Manager   June 24, 2011
Theodore Schartz       

 

      Manager  
Siran Samarasinghe       

/s/ Malcolm Swain

 

      Manager   June 24, 2011
Malcolm Swain       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Mauritius Company Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS MAURITIUS COMPANY LIMITED
By:   /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Mauritius Company Limited:

 

Signature      Title   Date

/s/ Terry O’Halloran

 

      (Principal Executive Officer)   June 24, 2011
Terry O’Halloran       

/s/ Ronald L. Dewey

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Ronald L. Dewey       

/s/ Kathleen Lai

 

      Director   June 24, 2011
Kathleen Lai       

/s/ Christian Li

 

      Director   June 24, 2011
Christian Li       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Overseas Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS OVERSEAS COMPANY
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Overseas Company:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

 

 

      Director  
Nicolas Paul Wilkinson       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Overseas Holdings S.à r.l. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg on the 24th day of June, 2011.

 

TOMKINS OVERSEAS HOLDINGS S.À R.L.

By: /s/ Geraldine Cassells                  

Name: Geraldine Cassells

Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Overseas Holdings S.à r.l.:

 

Signature      Title   Date

/s/ Geraldine Cassells

 

      Manager   June 24, 2011
Geraldine Cassells      (Principal Executive Officer and Principal Financial and Accounting Officer)  

/s/ Theodore Schartz

 

      Manager   June 24, 2011
Theodore Schartz       

 

 

      Manager  
Siran Samarasinghe       

 

 

       
Robert Verdonk      Manager  

/s/ Malcolm Swain

 

      Manager   June 24, 2011
Malcolm Swain       

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/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Overseas Investments Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS OVERSEAS INVESTMENTS LIMITED
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Overseas Investments Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Pension Services Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS PENSION SERVICES LIMITED
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Pension Services Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Poly Belt Mexicana, S.A. de C.V. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS POLY BELT MEXICANA, S.A. DE C.V.

By: /s/ John W. Zimmerman                    

Name: John W. Zimmerman

Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Poly Belt Mexicana, S.A. de C.V.:

 

Signature      Title   Date

/s/ Patricia W. Warfield

 

      Sole Administrator   June 24, 2011
Patricia W. Warfield      (Principal Executive Officer)  

/s/ Ross G. Bratlee

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Ross G. Bratlee       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins SC1 Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS SC1 LIMITED

By: /s/ John W. Zimmerman                    

Name: John W. Zimmerman

Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins SC1 Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Sterling Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS STERLING COMPANY
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Sterling Company:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Treasury (Canadian Dollar) Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS TREASURY (CANADIAN DOLLAR) COMPANY
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Treasury (Canadian Dollar) Company:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

 

 

      Director  
Nicolas Paul Wilkinson       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Treasury (Dollar) Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS TREASURY (DOLLAR) COMPANY
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Treasury (Dollar) Company:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

 

 

      Director  
Nicolas Paul Wilkinson       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins Treasury (Euro) Company has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS TREASURY (EURO) COMPANY
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins Treasury (Euro) Company:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

 

 

      Director  
Nicolas Paul Wilkinson       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins U.S., L.P. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg, on the 24th day of June, 2011.

 

TOMKINS U.S., L.P.

BY TOMKINS LUXEMBOURG S.À R.L.,

ITS GENERAL PARTNER

By: /s/ Geraldine Cassells
Name: Geraldine Cassells
Title:   Manager

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Geraldine Cassells and Theodore Schartz and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins U.S., L.P.:

 

Signature    Title   Date

/s/ Geraldine Cassells

 

    Manager  

June 24, 2011

Geraldine Cassells

   

(Principal Executive Officer and Principal

Financial and Accounting Officer) of Tomkins

Luxembourg S.à r.l., General Partner of

Tomkins U.S., L.P.

  

/s/ Theodore Schartz

 

    Manager of Tomkins Luxembourg S.à r.l.,  

June 24, 2011

Theodore Schartz    General Partner of Tomkins U.S., L.P.  

 

    Manager of Tomkins Luxembourg S.à r.l.,  
Siran Samarasinghe    General Partner of Tomkins U.S., L.P.  

/s/ Malcolm Swain

 

   

Manager of Tomkins Luxembourg S.à r.l.,

   June 24, 2011
Malcolm Swain    General Partner of Tomkins U.S., L.P.  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins, Inc. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS, INC.
By:  /s/ John W. Zimmerman                    
Name:   John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins, Inc.:

 

Signature      Title   Date

/s/ James Nicol

 

      President and Director   June 24, 2011
James Nicol      (Principal Executive Officer)  

/s/ John W. Zimmerman

 

      Director and Chief Financial Officer   June 24, 2011
John W. Zimmerman      (Principal Financial and Accounting Officer)  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tomkins, LLC has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TOMKINS, LLC

 

BY THE GATES CORPORATION AND

TOMKINS BUILDING PRODUCTS, INC.,

ITS MEMBERS

By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman

Title:  Authorized Officer of The Gates

           Corporation and Tomkins Building

           Products, Inc., Members of Tomkins,

           LLC

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tomkins, LLC:

 

Signature      Title   Date

/s/ James Nicol

 

      Chief Executive Officer and Director of The   June 24, 2011
James Nicol     

Gates Corporation, Member of Tomkins, LLC

(Principal Executive Officer)

  

/s/ John W. Zimmerman

 

      Chief Financial Officer and Director of The   June 24, 2011
John W. Zimmerman     

Gates Corporation, Member of Tomkins, LLC

(Principal Financial and Accounting

Officer)

  

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/s/ James Nicol

 

      Director of Tomkins Building Products, Inc.,   June 24, 2011
James Nicol     

Member of Tomkins, LLC

(Principal Executive Officer)

and Director of The Gates Corporation,

Member of Tomkins, LLC

  

/s/ John W. Zimmerman

 

      Director and Executive Vice President,   June 24, 2011
John W. Zimmerman     

Finance of Tomkins Building Products, Inc.,

Member of Tomkins, LLC

(Principal Financial and Accounting

Officer) and Director of The Gates

Corporation, Member of Tomkins, LLC

  

/s/ Shane Darren Feeney

 

      Director of The Gates Corporation and   June 24, 2011
Shane Darren Feeney     

Tomkins Building Products, Inc.,

Members of Tomkins, LLC

  

/s/ Konstantin Gilis

 

      Director of The Gates Corporation and   June 24, 2011
Konstantin Gilis     

Tomkins Building Products, Inc.,

Members of Tomkins, LLC

  

 

 

      Director of The Gates Corporation and   June 24, 2011
Seth Mitchell Mersky     

Tomkins Building Products, Inc.,

Members of Tomkins, LLC

  

/s/ Anthony David Morgan

 

      Director of The Gates Corporation and   June 24, 2011
Anthony David Morgan     

Tomkins Building Products, Inc.,

Members of Tomkins, LLC

  

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Trico Products (Dunstable) Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TRICO PRODUCTS (DUNSTABLE) LIMITED
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Trico Products (Dunstable) Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tridon Clamp Products GmbH has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

TRIDON CLAMP PRODUCTS GMBH
By:   /s/ Michael H. Reese                    
Name: Michael H. Reese
Title:   Managing Director

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Tridon Clamp Products GmbH:

 

Signature      Title   Date

/s/ Michael H. Reese

 

      Managing Director   June 24, 2011
Michael H. Reese      (Principal Executive Officer)  

/s/ Brenda March

 

      (Principal Financial and Accounting Officer)   June 24, 2011
Brenda March       

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Trion (Deutschland) GmbH has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado on the 24th day of June, 2011.

 

TRION (DEUTSCHLAND) GMBH
By:   /s/ Gordon Jones                    
Name: Gordon Jones
Title:   Managing Director
By:   /s/ Jon Muckley                    
Name: Jon Muckley
Title:   Managing Director

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Trion (Deutschland) GmbH:

 

Signature      Title   Date

/s/ Gordon Jones

 

      Managing Director   June 24, 2011
Gordon Jones      (Principal Executive Officer)  

/s/ Jon Muckley

 

      Managing Director   June 24, 2011
Jon Muckley      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Waltham Real Estate Holding Co. has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

WALTHAM REAL ESTATE HOLDING

CO.

By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Waltham Real Estate Holding Co.:

 

Signature      Title   Date

/s/ Alan J. Power

 

      (Principal Executive Officer)   June 24, 2011
Alan J. Power       

/s/ John W. Zimmerman

 

      Vice President & CFO   June 24, 2011
John W. Zimmerman     

(Principal Financial and Accounting

Officer)

  

/s/ Daniel J. Disser

 

      Director   June 24, 2011
Daniel J. Disser       

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Willer & Riley Limited has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Denver, Colorado, on the 24th day of June, 2011.

 

WILLER & RILEY LIMITED
By: /s/ John W. Zimmerman                    
Name: John W. Zimmerman
Title:   Authorized Officer

POWER OF ATTORNEY

Each person whose signature appears below hereby constitutes and appoints Thomas C. Reeve and Rasmani Bhattacharya and each of them the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462(b) under the Securities Act, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on June 24, 2011:

For Willer & Riley Limited:

 

Signature      Title   Date

/s/ Michael John Hopster

 

      Director   June 24, 2011
Michael John Hopster      (Principal Executive Officer)  

/s/ Elizabeth H. Lewzey

 

      Director   June 24, 2011
Elizabeth H. Lewzey      (Principal Financial and Accounting Officer)  

/s/ Thomas C. Reeve

 

      Authorized Representative in the United States   June 24, 2011
Thomas C. Reeve       
EX-3.1 2 dex31.htm EXHIBIT 3.1 Exhibit 3.1

Exhibit 3.1

Unofficial translation of the articles of association of: Pinafore Holdings B.V. as they read after the execution of the deed of partial amendment of the articles of association before Dirk-Jan Jeroen Smit, civil law notary in Amsterdam, the Netherlands, on 23 September 2010.

ARTICLES OF ASSOCIATION:

CHAPTER I.

DEFINITIONS.

Article 1.

In these articles of association the following expressions shall have the following meanings:

 

(a) the General Meeting: the body of the company formed by shareholders and other persons entitled to vote;

 

(b) the General Meeting of Shareholders: the meeting of shareholders and other persons entitled to attend general meetings;

 

(c) Depository Receipts: registered depository receipts of shares in the capital of the company. Unless the contrary appears, this expression shall also include depository receipts issued without the company’s cooperation;

 

(d) Depository Receipt Holders: holders of depository receipts of shares issued with the cooperation of the company. Unless the contrary appears, this expression shall also include those persons who, as a result of a life interest or a pledge in a share, enjoy the rights, which, by virtue of the law, accrue to holders of Depository Receipts issued with the company’s cooperation;

 

(e) the Distributable part of the net assets: that part of the company’s net assets which exceeds the aggregate of the issued capital and the reserves which must be maintained by virtue of the law;

 

(f) the Annual Accounts: the balance sheet and the profit and loss account with the explanatory notes;

 

(g) the Annual Meeting: the General Meeting of Shareholders held for the purpose of discussion and adoption of the Annual Accounts;

 

(h) Accountant: a “register-accountant” or other accountant referred to in Section 2:393 of the Dutch Civil Code, as well as an organisation within which such accountants practice; and

 

(i) business day means a day (excluding Saturdays) on which banks generally are open in Amsterdam (the Netherlands) and Toronto (Canada) for the transaction of normal banking business.

CHAPTER II.

NAME. SEAT. OBJECTS.

Article 2. Name and Seat.

 

1. The name of the company is:

Pinafore Holdings B.V.

 

2. The official seat of the company is in Amsterdam.

Article 3. Objects.

The objects of the company are:

 

(a) to incorporate, to participate in any way whatsoever, to manage, to supervise, to operate and to promote enterprises, businesses and companies;

 

(b) to finance businesses and companies;

 

(c) to supply advice and to render services to enterprises and companies with which the company forms a group and to third parties;

(d) to borrow, to lend and to raise funds, including the issue of bonds, promissory notes or other securities or evidence of indebtedness as well as to enter into agreement in connection with the aforementioned;

 

(e) to render guarantees, to bind the company and to pledge its assets for obligations of the companies and enterprises with which it forms a group and on behalf of third parties;

 

(f) to obtain, alienate, manage and exploit registered property and items of property in general;

 

(g) to trade in currencies, securities and items of property in general;

 

(h) to develop and trade patent, trade marks, licenses, know-how and other industrial property rights;

 

(i) to perform any and all activity of industrial, financial or commercial nature;

as well as everything pertaining the foregoing, relating thereto or conductive thereto, all in the widest sense of the word.

CHAPTER III.

CAPITAL AND SHARES. REGISTER.

Article 4. Authorised capital.

 

1. The authorised capital amounts to ninety thousand euro (€ 90,000).

 

2. The authorised capital is divided into:

 

  (a) ten (10) shares A, with a nominal value of three thousand euros (€ 3,600) each, numbered A1 through A10; and

 

  (b) five million four hundred thousand (5,400,000) shares B, with a nominal value of one eurocent (€ 0.01) each, numbered B1 through B5,400,000.

 

3. If in these articles of association shares and shareholders are mentioned, these expressions shall refer to both classes of shares referred to in paragraph 2 and the holders of those shares, save as otherwise expressed.

 

4. All shares are to be registered shares. No share certificates shall be issued.

Article 5. Register of shareholders.

 

1. The management board shall keep a register in which the names and addresses of all holders of shares are recorded, showing the date on which they acquired the shares, the date of the acknowledgement or notification and the amount paid on each share and the class of the shares.

 

2. The names and addresses of those with a right of usufruct (‘life interest’) or a pledge on the shares shall also be entered in the register, stating the date on which they acquired the right, and the date of acknowledgement or notification, and whether they have the voting rights or the rights of a Depository Receipt Holder.

 

3. Each shareholder, each beneficiary of the life interest, each pledgee and each Depository Receipt Holder is required to give written notice of his address to the company.

 

4. The register shall be kept accurate and up to date. All entries and notes in the register shall be signed by a member of the management board.

 

5. On application by a shareholder, a beneficiary of a life interest or a pledgee, the management board shall furnish an extract from the register, free of charge, insofar as it relates to his rights in a share. In the event that a life interest or pledge has been created in a share, the extract shall state to whom the voting rights accrue and to whom the rights of a Depository Receipt Holder accrue.

 

Pagina 2

6. The management board shall make the register available at the company’s office for inspection by the shareholders, as well as by the beneficiaries of a life interest and the pledgees to whom the rights of a Depository Receipt Holder accrue.

 

7. Furthermore, the management board shall keep a register in which the names and addresses of Depository Receipts Holders are to be recorded. This register may be part of the shareholders’ register.

CHAPTER IV.

ISSUANCE OF SHARES. OWN SHARES.

Article 6. Issuance of shares. Body competent to issue shares. Notarial deed.

 

1. The issuance of shares may only be effected pursuant to a resolution of the management board.

 

2. The issuance of a share shall furthermore require a deed drawn up for that purpose in the presence of a civil law notary registered in the Netherlands to which those involved are party.

 

3. Paragraph1 of this article shall apply mutatis mutandis to granting rights to subscribe for shares, but does not apply to the issue of shares to a party exercising a previously obtained right to subscribe for shares.

Article 7. Conditions of issuance. Rights of pre-emption.

 

1. A resolution for the issuance of shares shall stipulate the price and further conditions of issuance.

 

2. A shareholder has no pre-emptive right upon the issuance of shares.

Article 8. Payment for shares.

 

1. The full nominal amount of each share must be paid in on issue.

 

2. Payment for a share must be made in cash insofar as no other manner of payment has been agreed on. The management board shall be authorised to perform legal acts pertaining to a non-cash contribution on shares.

 

3. Payment in foreign currency can be made only after approval by the company.

Article 9. Own shares.

 

1. When issuing shares, the company shall not be entitled to subscribe for its own shares.

 

2. The company may, subject to the relevant provisions of the law, acquire fully paid in shares in its own capital or Depository Receipts, up to the maximum permitted by law.

 

3. The company may give loans with a view to the subscription for or acquisition of shares in its capital or Depository Receipts, but only up to the amount of the distributable reserves.

 

4. The disposal of shares or Depository Receipts held by the company shall be effected pursuant to a resolution of the General Meeting. The resolution to dispose of such shares or Depository Receipts shall also stipulate the conditions of the disposal. The disposal of shares held by the company shall be effected with due observance of the provisions of the blocking clause.

 

5. No voting rights may be exercised in the General Meeting for any share held by the company or any of its subsidiaries, nor in respect of any share of which the company or any of its subsidiaries holds Depository Receipts. Beneficiaries of a life interest and pledgees of shares which belong to the company and its subsidiaries are not excluded from exercising the voting rights, if the life interest or pledge was created before the share belonged to the company or any of its subsidiaries.

 

Pagina 3

Article 10. Reduction of capital.

 

1. The General Meeting may, subject to the relevant provisions of the law, resolve to reduce the issued capital.

 

2. Reduction of capital may also be effected with respect to either the ordinary shares A or the ordinary shares B, provided that the class of shares with respect to which reduction of capital shall be effected, is identified by the General Meeting, by resolution adopted by unanimous vote in a meeting at which the entire issued capital is represented. A new meeting, as referred to in section 2:230 of the Dutch Civil Code, may not be convened on this matter. The capital reduction shall be effected in proportion to the shares included therein, unless all of the shareholders concerned consent to deviate from this principle.

 

3. The notice of the General Meeting at which any resolution referred to in this article shall be proposed, shall mention the purpose of the capital reduction and the manner in which it is to be achieved.

CHAPTER V.

Transfer of shares. Limited rights.

Issuance of Depository Receipts.

Article 11. Transfer of shares. Shareholders’ rights. Life interest

(“Vruchtgebruik”). Pledging (“Pandrecht”).

 

1. The transfer of a share or the transfer of a right in rem thereon shall require a deed drawn up for that purpose in the presence of a civil law notary registered in the Netherlands to which those involved are party.

 

2. Unless the company itself is party to the legal act, the rights attached to the share can only be exercised after the company has acknowledged said legal act or said deed has been served on it in accordance with the relevant provisions of the law.

 

3. On the creation of a life interest or a pledge on shares the right to vote can, subject to the provisions of the law, be given to the beneficiary of the life interest or to the pledgee.

 

4. A pledgee without the right to vote shall not have the rights which, by virtue of the law, accrue to Depositary Receipts Holders issued, unless provided otherwise by the establishing of the right of pledge.

Article 12. Issuance of Depository Receipts.

The company shall only lend its co-operation to the issuance of Depository Receipts for its shares following a resolution of the General Meeting.

CHAPTER VI.

Blocking clause.

CHAPTER VI.

Article 13. Blocking clause.

Subsection A. Approval an intended transfer.

 

1. In order to be valid any transfer of shares shall require the approval of the management board, which approval shall remain valid for three months. Allotment in the event of partition of a joint property is to be regarded as a “transfer” with the exception of allotment to the person from whose side the shares have fallen into the joint property.

 

2.

A shareholder who wishes to transfer shares - in this article also referred to as the applicant - shall give notice of such intention to the management board by registered letter or against a receipt, which notice shall specify the number of

 

Pagina 4

 

shares he wishes to transfer and the person or the persons to whom he wishes to transfer the shares.

 

3. The management board shall be obliged to decide upon the transfer of shares within six weeks from the date of receipt of the notice referred to in the preceding paragraph. The contents of such notice shall be stated in the convocation.

 

4. If:

 

  (a) no such decision as referred to in paragraph 3 has been made within the term mentioned in that paragraph;

 

  (b) within that time no resolution has been adopted regarding the request for approval;

 

  (c) such approval has been refused without the management board having informed the applicant, at the same time as the refusal, of one or more interested parties who are prepared to purchase all the shares to which the request for approval relates, against payment in cash;

the approval requested shall be deemed to have been granted and, in the case mentioned under a, shall be deemed to have been granted on the final day on which the meeting should have been held.

 

5. If the management board grants the approval requested or if the approval shall be deemed to have been granted, the transfer can only take place within three months thereafter.

 

6. Unless the applicant and the party(ies) interested designated by the management board and accepted by him agree otherwise as to the price or the determination of the price, the purchase price of the shares shall be determined by an expert, appointed at the request of the most willing party by the chairman of the Chamber of Commerce in whose district the company has its official seat.

 

7. The applicant remains entitled to withdraw, until the expiry of one month after the determination of aforesaid price has been communicated to him in writing.

 

8. The costs of determining the price shall be borne:

 

  (a) by the applicant if he withdraws;

 

  (b) by the applicant as to one half and the purchasers as to the other half if the shares are purchased by the interested parties, on the understanding that each purchaser shall contribute in proportion to the number of shares purchased by him; or

 

  (c) by the company in cases not falling under (a) or (b).

 

9. The company itself can only be an interested party as referred to in paragraph 4 under (c) with the consent of the applicant.

Subsection B. Obligation to offer shares.

 

1. In the case of the death of a shareholder, in the case of the suspension of payments, bankruptcy or receivership of a shareholder and in the case of the appointment of an administrator by the court over the property of a shareholder or over his shares in the company, the shares of the shareholder concerned shall be offered for sale to the other shareholders subject to due observance of the provisions of the following paragraphs. From the time the obligation as referred to in the foregoing sentence, the relevant shareholder is no longer authorised to exercise the right to attend the meeting and to cast a vote in this meeting and to exercise the right of payments.

 

Pagina 5

2. The obligation to offer the shares for sale must be complied with within one month after it has arisen.

 

3. The shares offered shall be sold to the person(s) to be designated by the meeting of the holder(s) of shares B in the capital of the company pro rata the number of shares B hold by each holder of shares B in relation to the aggregate amount of issued shares B. The company itself can be purchaser of the shares with the consent of the offeror.

 

4. The provisions of paragraph 6 of the foregoing subsection shall apply accordingly.

 

5. The offeror shall not have the right to withdraw his offer. If not all shares are to be purchased, the offeror shall have the right to keep his shares. The relevant shareholder shall as of that moment again be authorised to exercise the right to attend the meeting and to cast a vote in this meeting and to exercise the right of payments.

 

6. If the obligation to offer is not complied with in time, the company shall be irrevocably empowered to offer such shares for sale and, if all shares are purchased, to deliver them to the purchaser(s) with due observance of the above provisions of this article. The company shall pay the purchase price to the party entitled thereto, after deduction of the expenses that are chargeable to him.

 

7. The provisions of this subsection shall not apply if the General Meeting grants relief of the obligation to offer the shares.

Subsection C. Exception to the offer.

The provisions of section A and section B do not apply if the shareholder is obligated by law to transfer his shares to a prior shareholder.

CHAPTER VII.

Management.

Article 14. Management board.

The management board of the company shall be constituted by two (2) members A, two (2) members B and four (4) members C or such other number as determined by the General Meeting. At least fifty per cent. (50%) of the members of the Management Board should be residents of the Netherlands.

Article 15. Appointment. Suspension and dismissal. Remuneration.

 

1. The General Meeting shall appoint the members of the management board and shall determine their title.

 

2. A member of the management board may at any time be suspended or dismissed by the General Meeting.

 

3. Any suspension may be extended one (1) or more times, but may not last longer than three (3) months in the aggregate. If at the end of that period no decision has been taken on termination of the suspension, or on dismissal, the suspension shall cease.

 

4. The General Meeting shall determine the remuneration and further conditions of employment for each member of the management board.

Article 16. Duties of the management board. Decision making process. Allocation of duties.

 

1. Subject to the restrictions imposed by these articles of association, the management board shall be entrusted with the management of the company.

 

2. The management board shall meet on a regular basis but at least once a year.

 

Pagina 6

3. The management board shall also meet whenever one (1) member of the management board deems such necessary.

 

4. Each member of the management board is entitled to cast one (1) vote. All resolutions of the management board shall be adopted by a majority of the votes cast by the members of the management board that are present or represented at such meeting, whereby at least one (1) member A or one (1) member B of the management board vote in favour of the proposal, unless these articles of association or any board rules adopted by the management in accordance with paragraph 8 of this article determine otherwise. In the event of a tie of votes, the proposal shall be rejected. A report shall be drawn up regarding resolutions thus adopted and the replies received shall be attached to the report, which shall be signed by one (1) member A and one (1) member B of the management board.

 

5. A member of the management board may be represented by a co-member authorised in writing. The expression “in writing” shall include any message transmitted by current means of communication. A member of the management board may not act as representative for more than one co-member.

 

6. Resolutions of the management board may also be adopted in writing without recourse to a management board meeting, provided they are adopted by an unanimous vote of all members of the management board.

 

7. The chairman shall chair the meetings of the management board. In case of his absence the meeting shall appoint its chairman.

 

8. The management board may lay down rules regarding its own decision making process.

 

9. The management board may determine the duties with which each member of the management board shall be charged.

Article 17. Representation.

 

1. The management board shall be authorised to represent the company. A member A, a member B and a member C of the management board acting together are also authorised to represent the company.

 

2. The management board may appoint officers with general or limited power to represent the company. Each of these officers shall be able to represent the company with due observance of any restrictions imposed on him. The management board shall determine their titles.

 

3. In the event of a conflict of interest between the company and a member or all members of the management board, such member or all members of the management board shall remain authorised to represent the company. The General Meeting shall be authorised to designate another person or persons to represent the company for this purpose. No person may be designated unless he performs all his duties of managing the company in accordance with these articles of association in the Netherlands.

Article 18. Approval of decisions of the management board.

 

1. The General Meeting is entitled to require resolutions of the management board to be subject to its approval. These resolutions shall be clearly specified and notified to the management board in writing.

 

2. The lack of approval referred to in paragraph 1 does not affect the authority of the management board to represent the company.

Article 19. Absence or prevention.

 

Pagina 7

If a member of the management board is absent or prevented from performing his duties, the remaining members or member of the management board, shall be temporarily entrusted with the entire management of the company with due observance of the requirement that at each time at least one (1) member A of the management board and one (1) member B of the management board should be involved with the management of the company. If all members of the management board, the sole member of the management board, all members A of the management board or all members B of the management board are absent or prevented from performing their duties, the management of the company shall be temporarily entrusted to the person designated for this purpose by the General Meeting.

CHAPTER VIII.

Annual Accounts. Profits.

Article 20. Financial year. Drawing up of the Annual Accounts. Deposition for inspection.

 

1. The financial year of the company shall be the calendar year.

 

2. Annually, not later than five months after the end of the financial year, unless by reason of special circumstances this term is extended by the General Meeting by not more than six months, the management board shall draw up Annual Accounts.

 

3. The management board shall deposit the Annual Accounts for inspection by the shareholders and Depository Receipt Holders at the office of the company within the period referred to in paragraph 2. Within this period the management board shall also deposit the annual report for inspection by the shareholders and Depository Receipt Holders.

 

4. The Annual Accounts shall be signed by all the members of the management board; if the signature of one or more of them is lacking, this shall be stated and reasons given.

 

5. The company may, and if the law so requires shall, appoint an Accountant to audit the Annual Accounts.

Article 21. Adoption of the Annual Accounts. Publication.

 

1. The General Meeting shall adopt the Annual Accounts.

 

2. Unconditional adoption of the Annual Accounts shall not serve to constitute a discharge of the members of the management board for the management. Such discharge requires a separate resolution by the General Meeting.

 

3. The company shall publish the Annual Accounts within eight days following the adoption there subject to statutory exemptions, if applicable.

Article 22. Reserves. Profits.

 

1. The company maintains a share premium reserve A and a share premium reserve B. The holders of shares A are exclusively entitled to the share premium reserve A. The holders of shares B are exclusively entitled to the share premium reserve B.

 

2. The company maintains a dividend reserve A and a dividend reserve B. The holders of shares A are exclusively entitled to the dividend reserve A. The holders of shares B are exclusively entitled to the dividend reserve B.

 

3. Distributions can only take place up to the amount of the Distributable part of the net assets.

 

4. Distribution from the profits in respect of a financial year shall take place after the adoption of the Annual Accounts showing that this is permitted.

 

Pagina 8

5. If the General Meeting resolve to distribute profits available for distribution in a financial year, the following rules will have to be complied with:

 

  (a) Firstly a distribution on the shares A of a maximum amount of one thousand euro (€ 1,000) per share A per financial year. If the profits in a financial year do not or not entirely permit such distribution, the holders of shares A shall receive in the subsequent year the amount not yet distributed at the expense of the profits available for distribution in the subsequent financial years, in preference to any other distribution to the holders of the Shares B.

 

  (b) Secondly, any profits remaining after application of subparagraph (a) shall be allocated to the shares B on a pro rata basis.

If and to the extent that the General Meeting resolves not to distribute any profits, these profits shall be added to the dividend reserves of the company in accordance with the principles set out under (a) and (b) above.

 

6. The General Meeting may, subject to the relevant provisions of Dutch law and paragraphs 3 and 5 above, resolve to pay an interim dividend or to make payments from any reserve which does not need to be maintained by virtue of Dutch law or these articles of association.

 

7. The general meeting of holders of shares A can, with due observance of paragraph 1,2 and 3 of this article, resolve to make payments to the charge of the share premium reserve A and the dividend reserve A.

 

8. The general meeting of holders of shares B can, with due observance of paragraph 1, 2 and 3 of this article, resolve to make payments to the charge of the share premium reserve B and the dividend reserve B.

 

9. The General Meeting may, subject to due observance of paragraph 3, resolve to make payments to the charge of any other reserve than the reserves as referred to in paragraph 1 and 2 of this article.

 

10. A claim of a shareholder for payment of a dividend shall be barred after five years have elapsed.

CHAPTER IX.

General meetings of shareholders.

Article 23. Annual Meeting.

 

1. The Annual Meeting shall be held annually, and not later than six months after the end of the financial year, for the purpose of discussion and adoption of the Annual Accounts.

 

2. Other General Meetings of Shareholders shall be held as often as the management board deems such necessary.

 

3. General Meetings of Shareholders shall be convoked by the management board, by letter mailed to the addresses of the shareholders and Depository Receipt Holders as shown in the register of shareholders and the register of Depository Receipt Holders. General Meetings of Shareholders may also be convoked by a legible and reproducible notice sent by electronic means of communication to the address of the shareholders as notified for this purpose to the company, provided that the relevant shareholders have given their consent thereto.

 

4. The convocation shall take place no later than on the fifteenth day prior to the date of the meeting.

 

Pagina 9

5. The General Meetings of Shareholders shall be held in the municipality in which the company has its official seat according to these articles of association.

 

6. The General Meeting shall itself appoint its chairman. Until that moment a member of the management board shall act as chairman and in the absence of such a member the eldest person at the meeting shall act as chairman.

 

7. The members of the management board shall, as such, have the right to give advice in the General Meeting of Shareholders.

Article 24. Waiver of formalities.

 

1. As long as the entire issued capital and all Depository Receipt Holders are represented at a General Meeting of Shareholders valid resolutions can be adopted on all subjects brought up for discussion, even if the formalities prescribed by law or by the articles of association for the convocation and holding of meetings have not been complied with, provided such resolutions are adopted unanimously.

 

2. The management board keeps a record of the resolutions made. If the management board is not represented at a meeting, the chairman of the meeting shall provide the management board with a transcript of the resolutions made as soon as possible after the meeting. The records shall be deposited at the offices of the company for inspection by the shareholders and Depository Receipt Holders. Upon request each of them shall be provided with a copy or an extract of such record at not more than the actual costs.

Article 25. Voting rights.

 

1. Each share A confers the right to cast three hundred and sixty thousand (360,000) votes. Each share B confers the right to cast one vote.

 

2. The right to take part in the meeting may be exercised by a proxy authorised in writing. The provisions of Article 16 paragraph 5 second sentence, shall apply accordingly. The right to take part in the meeting may also be exercised through electronic means of communication, provided that the shareholder thus taking part in the meeting can be identified through the electronic means of communication, is able to directly take note of the proceedings at the meeting and may exercise his rights to vote. The management board may lay down rules regarding the use of electronic means of communication, which shall be announced in the convening notice.

 

3. To the extent that the law or the articles of association do not require a qualified majority, all resolutions shall be adopted by a majority of the votes cast.

 

4. If there is a tie vote of votes the proposal is thus rejected.

Article 26. Resolutions outside of meetings. Records.

 

1. Resolutions of shareholders may also be adopted in writing without recourse to a General Meeting of Shareholders, provided they are adopted by a unanimous vote of all shareholders entitled to vote. The provisions of Article 16 paragraph 5 second sentence, shall apply accordingly. The aforementioned decision making process shall not be permissible in the event that there are Depository Receipt Holders.

 

2. The provisions of article 23 paragraph 7 shall apply correspondingly to the adoption of resolutions outside a meeting as referred to in paragraph 1.

 

3.

The management board shall keep a record of the resolutions thus made. Each of the shareholders must procure that the management board is informed in

 

Pagina 10

 

writing of the resolutions made in accordance with paragraph 1 as soon as possible. The records shall be deposited at the offices of the company for inspection by the shareholders and Depository Receipt Holders. Upon request, each of them shall be provided with a copy or an extract of such record at not more than the actual costs.

Article 27. Meetings of holders of shares of one class.

 

1. Meetings of holders of shares of one class shall be convened by the management board or by a holder of one or more shares of the relevant class, by letter to the addresses of the holders of shares of the relevant class according to the register of shareholders and the holders of Depository Receipts of the relevant class, according to the register of shareholders and the register of Depository Receipt holders of shares in the relevant class.

 

2. Meetings shall itself appoint its chairman. Until that moment the eldest person present at the meeting shall act as chairman.

 

3. To the extent possible, article 23 paragraphs 4 and 5, 24, 25 paragraphs 1 through 4 and 26 shall correspondingly apply.

CHAPTER X.

Amendment of the articles of association and dissolution.

Liquidation.

Article 28. Amendment of the articles of association and dissolution.

When a proposal of the management board to amend the articles of association or to dissolve the company is to be made to the General Meeting, this must be mentioned in the notification of the General Meeting of Shareholders. As regards an amendment of the articles of association, a copy of the proposal including the text of the proposed amendment must at the same time be deposited and held available at the company’s office for inspection by shareholders and Depository Receipt Holders until the end of the meeting.

Article 29. Liquidation.

 

1. In the event of dissolution of the company by virtue of a resolution of the General Meeting, the members of the management board shall be charged with the liquidation of the business of the company.

 

2. During liquidation, the provisions of these articles of association shall remain in force as far as possible.

 

3. The balance of the company remaining after payment of debts, shall be transferred to the shareholders conform the provisions set out in article 23 paragraph 3.

Article 30. Final Provision.

The first financial year of the company shall end on the thirty-first day of December two thousand ten.

This transitional provision shall lapse and cease to exist after the first financial year.

 

Pagina 11

EX-3.2 3 dex32.htm EXHIBIT 3.2 Exhibit 3.2

Exhibit 3.2

Please note that this is an unofficial office translation, in which an attempt has been made to be as literal as possible without jeopardizing the overall continuity. Inevitably, differences may occur in translation, and if so, the Dutch text will by law govern.

DEED OF PARTIAL AMENDMENT OF THE ARTICLES OF ASSOCIATION OF PINAFORE HOLDINGS B.V.

On the twenty-third day of September two thousand and ten appeared before me, Dirk-Jan Jeroen Smit, civil law notary, officiating in Amsterdam, the Netherlands: Marrigje Elisabeth de Wilde, born in Kampen, the Netherlands, on the twentieth day of March nineteen hundred and eighty-four and with office address at Strawinskylaan 10, 1077 XZ Amsterdam, the Netherlands.

The person appearing declared that on the twenty-first day of September two thousand and ten, the general meeting of Pinafore Holdings B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands, having its official seat in Amstedam, the Netherlands, and its office address at Fred. Roeskestraat 123, 1076 EE Amsterdam, the Netherlands, resolved without holding a general meeting of shareholders to partially amend the articles of association of the company and to authorise the person appearing to execute this deed. A copy of the resolution has been attached to this deed.

The articles of association of the company have been established at the incorporation of the company by a notarial deed of [incorporation executed before Dirk-Jan Jeroen Smit, civil law notary, aforementioned, on the first day of September two thousand and ten, for which the required ministerial declaration of no-objections has been granted on the first day of September two thousand and ten under number BV 1612366. The articles of association have not been amended ever since. The person appearing declared to partially amend the articles of association of the company as follows:

 

I Article 6 paragraph 1 will be amended and will read as follows:

  “1. The issuance of shares may only be effected pursuant to a resolution of the management board.”

 

II Article 13, subsection A, paragraphs 1 and 3 through 6 will be amended and will read as follows:

 

  “1. In order to be valid any transfer of shares shall require the approval of the management board, which approval shall remain valid for three months. Allotment in the event of partition of a joint property is to be regarded as a “transfer” with the exception of allotment to the person from whose side the shares have fallen into the joint property.”

 

  “3. The management board shall be obliged to decide upon the transfer of shares within six weeks from the date of receipt of the notice referred to in the preceding paragraph. The contents of such notice shall be stated in the convocation.

 

  4. If:

 

  (a) within the term mentioned in that paragraph no resolution has been adopted regarding the request for approval;

 

  (b) such approval has been refused without the management board having informed the applicant, at the same time as the refusal, of one or more interested parties who are prepared to purchase all the shares to which the request for approval relates, against payment in cash;

the approval requested shall be deemed to have been granted and, in the case mentioned under a, shall be deemed to have been granted on the final day on which the decision should have been made.

 

  5. If the management board grants the approval requested or if the approval shall be deemed to have been granted, the transfer can only take place within three months thereafter.

 

  6. Unless the applicant and the party(ies) interested designated by the management board and accepted by him agree otherwise as to the price or the determination of the price, the purchase price of the shares shall be determined by an expert, appointed at the request of the most willing party by the chairman of the Chamber of Commerce in whose district the company has its official seat.”

 

III Article 16 paragraphs 4 and 6 will be amended and will read as follows:

 

  “4.

Each member of the management board is entitled to cast one (1) vote. All resolutions of the management board shall be adopted by a majority of the votes cast by the members of the management board that are present or represented at such meeting, whereby at least one (1) member A or one (1) member B of the management board vote in favour of the proposal, unless these articles of association or any board rules adopted by the management in accordance with paragraph

 

8 of this article determine otherwise. In the event of a tie of votes, the proposal shall be rejected. A report shall be drawn up regarding resolutions thus adopted and the replies received shall be attached to the report, which shall be signed by one (1) member A and one (1) member B of the management board.”

 

  “6. Resolutions of the management board may also be adopted in writing without recourse to a management board meeting, provided they are adopted by an unanimous vote of all members of the management board.”

 

IV Article 22 paragraphs 5 and 6 will be amended and will read as follows:

 

  “5. If the General Meeting resolve to distribute profits available for distribution in a financial year, the following rules will have to be complied with:

 

  (a) Firstly a distribution on the shares A of a maximum amount of one thousand euro (€ 1,000) per share A per financial year. If the profits in a financial year do not or not entirely permit such distribution, the holders of shares A shall receive in the subsequent year the amount not yet distributed at the expense of the profits available for distribution in the subsequent financial years, in preference to any other distribution to the holders of the Shares B.

 

  (b) Secondly, any profits remaining after application of subparagraph (a) shall be allocated to the shares B on a pro rata basis.

If and to the extent that the General Meeting resolves not to distribute any profits, these profits shall be added to the dividend reserves of the company in accordance with the principles set out under (a) and (b) above.

 

  6. The General Meeting may, subject to the relevant provisions of Dutch law and paragraphs 3 and 5 above, resolve to pay an interim dividend or to make payments from any reserve which does not need to be maintained by virtue of Dutch law or these articles of association.”

Final.

The ministerial declaration of no-objections has been granted on the twenty-second day of September thousand and ten under number BV 1612366 and has been attached to this deed.

In witness whereof the original of this deed, which shall be retained by me, civil law notary, was executed in Amsterdam, the Netherlands, on the date first given in the head of this deed.

Having conveyed and explained the substance of this deed to the person appearing she declared that she took cognisance of the contents of the deed, agreed to these contents and did not require the deed to be read out to her in full. Immediately after the reading of those parts of the deed which the law prescribes to be read out, this deed was signed by the person appearing, who is known to me, civil law notary, and by myself, civil law notary.

LOGO

The attached document is a complete text in Dutch of the articles of association of: Pinafore Holdings B.V., having its official seat in Amsterdam, the Netherlands, as they read after execution of the notarial deed of partial amendment of the articles of association, before Dirk-Jan Jeroen Smit, civil law notary, officiating in Amsterdam, on 23 September 2010.

 

Amsterdam, 23 September 2010.

 

Dirk-Jan Jeroen Smit,

civil law notary,

officiating in Amsterdam.

   LOGO

LOGO

LOGO

EX-3.3 4 dex33.htm EXHIBIT 3.3 Exhibit 3.3

Exhibit 3.3

CERTIFICATE OF INCORPORATION

OF

PINAFORE, INC.

FIRST: The name of the corporation (hereinafter sometimes referred to as the “Corporation”) is:

Pinafore, Inc.

SECOND: The address of the registered office of the Corporation in the State of Delaware is 1209 Orange Street, New Castle County, Wilmington, Delaware 19801. The name of its registered agent at such address is The Corporation Trust Company.

THIRD: The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “DGCL”).

FOURTH: The aggregate number of all classes of shares of capital stock which the Corporation shall have the authority to issue is one thousand (1,000) shares of common stock, with a par value of $0.01 per share (the “Common Stock”).

FIFTH: The rights, preferences, privileges and restrictions granted or imposed upon the Common Stock are as follows:

1. Dividends. The holders of the Common Stock shall be entitled to the payment of dividends when and as declared by the board of directors of the Corporation (the “Board”) out of funds legally available therefor and to receive other distributions from the Corporation, including distributions of contributed capital, when and as declared by the Board. Any dividends declared by the Board to the holders of the then outstanding Common Stock shall be paid to the holders thereof pro rata in accordance with the number of shares of Common Stock held by each such holder as of the record date of such dividend.

2. Liquidation, Dissolution or Winding Up. In the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the funds and assets of the Corporation that may be legally distributed to the

Corporation’s stockholders shall be distributed among the holders of the then outstanding Common Stock pro rata, in accordance with the number of shares of Common Stock held by each such holder.

3. Voting. Each holder of Common Stock shall have full voting rights and powers equal to the voting rights and powers of each other holder of Common Stock and shall be entitled to one (1) vote for each share of Common Stock held by such holder. Each holder of Common Stock shall be entitled to notice of any stockholders’ meeting in accordance with the bylaws of the Corporation (as in effect at the time in question) and applicable law on all matters put to a vote of the stockholders of the Corporation.

SIXTH: The name and address of the Incorporator is as follows:

Eleanor Romanelli

Latham & Watkins LLP

555 Eleventh Street, NW

Suite 1000

Washington, D.C. 20004

SEVENTH: In furtherance and not in limitation of the power conferred by statute, the Board is expressly authorized to make, alter or repeal the bylaws of the Corporation subject to any limitations contained therein.

EIGHTH: No director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages for the breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL as the same exists or may hereafter be amended. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of the Corporation hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or repeal.

NINTH: Election of directors need not be by written ballot unless the bylaws of the Corporation shall so provide.

TENTH: The Corporation reserves the right to amend, alter, change or repeal any provisions contained in this Certificate of Incorporation, in the manner now or hereafter

 

2

prescribed by the DGCL. All rights conferred upon stockholders herein are granted subject to this reservation.

ELEVENTH: To the fullest extent permitted by applicable law, the Corporation is authorized to provide indemnification of (and advancement of expenses to) agents of the Corporation (and any other persons to which the DGCL permits the Corporation to provide indemnification) through bylaw provisions or agreements with such agents or other persons, by vote of stockholders or disinterested directors or otherwise, in excess of the indemnification and advancement otherwise permitted by Section 145 of the DGCL, subject only to limits created by the DGCL and applicable decisional law, with respect to actions for breach of duty to the Corporation, its stockholders, and others.

I, THE UNDERSIGNED, being the sole Incorporator hereinbefore named, for the purpose of forming a corporation pursuant to the DGCL, do make this certificate, herein declaring and certifying that this is my act and deed and the facts herein stated are true, and accordingly have hereunto set my hand this 16th day of July, 2010.

 

/s/ Eleanor Romanelli

Eleanor Romanelli
Incorporator

 

3

EX-3.4 5 dex34.htm EXHIBIT 3.4 Exhibit 3.4

Exhibit 3.4

CERTIFICATE OF AMENDMENT

TO

CERTIFICATE OF INCORPORATION

OF

PINAFORE, INC.

Pursuant to Section 242 of the Delaware General Corporation Law, as amended, it is hereby certified that:

1. The name of the corporation (the “Corporation”) is Pinafore, Inc.

2. The Certificate of Incorporation of the Corporation is hereby amended by deleting Article 1 and inserting in lieu thereof a new Article 1 to read as follows:

FIRST: The name of the corporation (hereinafter sometimes referred to as the “Corporation”) is:

Tomkins, Inc.

IN WITNESS WHEREOF, the undersigned has executed this Certificate of Amendment to the Certificate of Incorporation on this 30th day of November, 2010.

 

By:  

/s/ Seth Mersky

  Name:   Seth Mersky
  Title:   President
 EX-3.5 6 dex35.htm EXHIBIT 3.5 Exhibit 3.5

Exhibit 3.5

BYLAWS

OF

PINAFORE, INC.

ARTICLE I.

OFFICES

Section 1. Registered Office. The registered office of Pinafore, Inc. (the “Corporation”) shall be in the City of Wilmington, County of New Castle, State of Delaware.

Section 2. Other Offices. The Corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require.

ARTICLE II.

MEETINGS OF STOCKHOLDERS

Section 1. Place of Meetings. Meetings of stockholders shall be held at any place within or outside the State of Delaware designated by the Board of Directors. The Board of Directors may, in its sole discretion, determine that a meeting of stockholders shall not be held at any place, but may instead be held solely by means of remote communication authorized by and in accordance with Section 211(a)(2) of the Delaware General Corporation Law (the “DGCL”). In the absence of any such designation, stockholders’ meetings shall be held at the principal executive office of the Corporation.

Section 2. Annual Meetings of Stockholders. The annual meeting of stockholders shall be held each year on a date and at a time designated by the Board of Directors. At each annual meeting, directors shall be elected and any other proper business may be transacted.

Section 3. Quorum; Adjourned Meetings and Notice Thereof. A majority of the stock issued and outstanding and entitled to vote at any meeting of stockholders, the holders of

which are present in person or represented by proxy, shall constitute a quorum for the transaction of business except as otherwise provided by law, by the Certificate of Incorporation, or by these Bylaws. A quorum, once established, shall not be broken by the withdrawal of enough votes to leave less than a quorum and the votes present may continue to transact business until adjournment. If, however, such quorum shall not be present or represented at any meeting of the stockholders, a majority of the voting stock represented in person or by proxy may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. If the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote thereat.

Section 4. Voting. When a quorum is present at any meeting, the vote of the holders of a majority of the stock having voting power present in person or represented by proxy shall decide any question brought before such meeting, unless the question is one upon which by express provision of the DGCL, or the Certificate of Incorporation, or these Bylaws, a different vote is required in which case such express provision shall govern and control the decision of such question. Except as may be otherwise provided in the Certificate of Incorporation, directors shall be elected by a plurality of the votes of the stock present in person or represented by proxy at the meeting entitled to vote on the election of directors

Section 5. Proxies. At each meeting of the stockholders, each stockholder having the right to vote may vote in person or may authorize another person or persons to act for him/her by proxy appointed by an instrument in writing subscribed by such stockholder and

 

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bearing a date not more than three years prior to said meeting, unless said instrument provides for a longer period. All proxies must be filed with the Secretary of the Corporation at the beginning of each meeting in order to be counted in any vote at the meeting. Each stockholder shall have one vote for each share of stock having voting power, registered in his/her name on the books of the Corporation on the record date set by the Board of Directors as provided in Article V, Section 6 hereof. All elections shall be had and all questions decided by a plurality vote.

Section 6. Special Meetings. Special meetings of the stockholders, for any purpose, or purposes, unless otherwise prescribed by statute or by the Certificate of Incorporation, may be called by the President and shall be called by the President or the Secretary at the request in writing of a majority of the Board of Directors, or at the request in writing of stockholders owning a majority in amount of the entire capital stock of the Corporation, issued and outstanding, and entitled to vote. Such request shall state the purpose or purposes of the proposed meeting. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice.

Section 7. Notice of Stockholder’s Meetings. Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which notice shall state the date and hour, the place (if any) and the means of remote communications (if any) of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Except as otherwise provided by law, the written notice of any meeting shall be given to each stockholder entitled to vote at such meeting not less than ten nor more than sixty days before the date of the meeting via mail, facsimile or electronic

 

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mail. If mailed, notice is given when deposited in the United States mail, postage prepaid, directed to the stockholder at his/her address as it appears on the records of the Corporation.

Section 8. Maintenance and Inspection of Stockholder List. The officer who has charge of the stock ledger of the Corporation shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, (i) at the Corporation’s discretion, on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting or (ii) during ordinary business hours at the Corporation’s principal place of business. In the event that the Corporation determines to make the list available on an electronic network, the Corporation may take reasonable steps to ensure that such information is available only to stockholders of the Corporation. If the meeting is to be held at a place, then the list shall be produced and kept at the time and place of the meeting during the whole time thereof and may be examined by any stockholder who is present. If the meeting is to be held solely by means of remote communication, then the list shall also be available for examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network and the information required to access such list shall be provided with the notice of the meeting.

Section 9. Stockholder Action by Written Consent Without a Meeting. Unless otherwise provided in the Certificate of Incorporation, any action required to be taken at any annual or special meeting of stockholders of the Corporation, or any action which may be taken

 

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at any annual or special meeting of such stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be (i) signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary (in accordance with the Certificate of Incorporation) to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and (ii) delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented to such action in writing and who, if the action had been taken at a meeting, would have been entitled to notice of such meeting.

ARTICLE III.

DIRECTORS

Section 1. The Number of Directors. The number of directors which shall constitute the whole Board shall be not less than one (1) and not more than nine (9). The exact number of directors shall be determined by resolution of the Board, and the initial number of directors shall be one (1). The directors need not be stockholders. The directors shall be elected at the annual meeting of the stockholders, except as provided in Section 2 of this Article, and each director elected shall hold office until his/her successor is elected and qualified; provided, however, that unless otherwise restricted by the Certificate of Incorporation or by law, any director or the entire Board of Directors may be removed, either with or without cause, from the Board of Directors at any meeting of stockholders by a majority of the stock represented and entitled to vote thereat.

 

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Section 2. Vacancies. Vacancies on the Board of Directors by reason of death, resignation, retirement, disqualification, removal from office, or otherwise, and newly created directorships resulting from any increase in the authorized number of directors may be filled by a majority of the directors then in office, although less than a quorum, or by a sole remaining director. The directors so chosen shall hold office until the next annual election of directors and until their successors are duly elected and shall qualify, unless sooner replaced by a vote of the stockholders. If there are no directors in office, then an election of directors may be held in the manner provided by the DGCL. If, at the time of filling any vacancy or any newly created directorship, the directors then in office shall constitute less than a majority of the whole Board (as constituted immediately prior to any such increase), the Court of Chancery may, upon application of any stockholder or stockholders holding at least ten percent of the total number of the shares at the time outstanding having the right to vote for such directors, summarily order an election to be held to fill any such vacancies or newly created directorships, or to replace the directors chosen by the directors then in office.

Section 3. Powers. The property and business of the Corporation shall be managed by or under the direction of its Board of Directors. In addition to the powers and authorities by these Bylaws expressly conferred upon them, the Board may exercise all such powers of the Corporation and do all such lawful acts and things as are not by the DGCL or by the Certificate of Incorporation or by these Bylaws directed or required to be exercised or done by the stockholders.

Section 4. Place of Directors’ Meetings. The directors may hold their meetings and have one or more offices, and keep the books of the Corporation outside of the State of Delaware.

 

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Section 5. Regular Meetings. Regular meetings of the Board of Directors may be held without notice at such time and place as shall from time to time be determined by the Board.

Section 6. Special Meetings. Special meetings of the Board of Directors may be called by the Chairman of the Board or the President or any two members of the Board of Directors on twenty-four hours’ notice to each director, either personally or by mail, electronic mail or facsimile.

Section 7. Quorum. At all meetings of the Board of Directors a majority of the authorized number of directors shall be necessary and sufficient to constitute a quorum for the transaction of business, and the vote of a majority of the directors present at any meeting at which there is a quorum, shall be the act of the Board of Directors, except as may be otherwise specifically provided by the DGCL, by the Certificate of Incorporation or by these Bylaws. If a quorum shall not be present at any meeting of the Board of Directors, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present. If only one director is authorized, such sole director shall constitute a quorum. At any meeting, a director shall have the right to be accompanied by counsel provided that such counsel shall agree to any confidentiality restrictions reasonably imposed by the Corporation.

Section 8. Action Without Meeting. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board or committee, as the case may be, consent thereto in writing, or by electronic transmission and the writing or writings or electronic transmission or transmissions are

 

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filed with the minutes of proceedings of the Board or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

Section 9. Telephonic Meetings. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, members of the Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting of the Board of Directors, or any committee, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at such meeting.

Section 10. Committees of Directors. The Board of Directors may, by resolution passed by a majority of the whole Board, designate one or more committees, each such committee to consist of one or more of the directors of the Corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he/she or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority to (x) approve, adopt or recommend to the stockholders of the Corporation any action or matter (other than the election or removal of

 

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directors) expressly required by the DGCL or the Certificate of Incorporation to be submitted to the stockholders of the Corporation for approval or (y) adopt, amend or repeal any portion of these Bylaws.

Section 11. Minutes of Committee Meetings. Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors when required.

Section 12. Compensation of Directors. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, the Board of Directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as director. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like compensation for attending committee meetings.

Section 13. Indemnification. In accordance with the Certificate of Incorporation, the Corporation shall indemnify and upon request advance expenses to every person who is or was a party or is or was threatened to be made a party to any action, suit, or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he/she is or was a director or officer of the Corporation or, while a director or officer or employee of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee, agent or trustee of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against expenses (including counsel fees), judgments,

 

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fines and amounts paid in settlement actually and reasonably incurred by him/her in connection with such action, suit or proceeding, to the full extent permitted by applicable law.

ARTICLE IV.

OFFICERS

Section 1. Officers. The officers of this corporation shall be chosen by the Board of Directors and shall include a President and a Secretary. The Corporation may also have, at the discretion of the Board of Directors, such other officers as are desired, including a Chairman of the Board, one or more Vice Presidents, a Treasurer, one or more Assistant Secretaries and Assistant Treasurers, and such other officers as may be appointed in accordance with the provisions of Section 3 hereof. In the event there are two or more Vice Presidents, then one or more may be designated as Executive Vice President, Senior Vice President, or other similar or dissimilar title. At the time of the election of officers, the directors may by resolution determine the order of their rank. Any number of offices may be held by the same person unless the Certificate of Incorporation or these Bylaws otherwise provide.

Section 2. Election of Officers. The Board of Directors, at its first meeting after each annual meeting of stockholders, shall choose the officers of the Corporation.

Section 3. Subordinate Officers. The Board of Directors may appoint such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board.

Section 4. Compensation of Officers. The salaries of all officers and agents of the Corporation shall be fixed by the Board of Directors.

 

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Section 5. Term of Office; Removal and Vacancies. The officers of the Corporation shall hold office until their successors are chosen and qualify in their stead. Any officer elected or appointed by the Board of Directors may be removed at any time by the affirmative vote of a majority of the Board of Directors. If the office of any officer or officers becomes vacant for any reason, the vacancy shall be filled by the Board of Directors.

Section 6. Chairman of the Board. The Chairman of the Board, if such an officer be elected, shall, if present, preside at all meetings of the Board of Directors and exercise and perform such other powers and duties as may be from time to time assigned to him/her by the Board of Directors or prescribed by these Bylaws. If there is no President, the Chairman of the Board shall in addition be the Chief Executive Officer of the Corporation and shall have the powers and duties prescribed in Section 7 of this Article IV.

Section 7. President. Subject to such supervisory powers, if any, as may be given by the Board of Directors to the Chairman of the Board, if there be such an officer, the President shall be the Chief Executive Officer of the Corporation and shall, subject to the control of the Board of Directors, have general supervision, direction and control of the business and officers of the Corporation. He/she shall preside at all meetings of the stockholders and, in the absence of the Chairman of the Board, or if there be none, at all meetings of the Board of Directors. He/she shall be an ex-officio member of all committees and shall have the general powers and duties of management usually vested in the office of President and Chief Executive Officer of corporations, and shall have such other powers and duties as may be prescribed by the Board of Directors or these Bylaws.

 

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Section 8. Vice Presidents. In the absence or disability of the President, the Vice Presidents in order of their rank as fixed by the Board of Directors, or if not ranked, the Vice President designated by the Board of Directors, shall perform all the duties of the President, and when so acting shall have all the powers of and be subject to all the restrictions upon the President. The Vice Presidents shall have such other duties as from time to time may be prescribed for them, respectively, by the Board of Directors.

Section 9. Secretary. The Secretary shall attend all sessions of the Board of Directors and all meetings of the stockholders and record all votes and the minutes of all proceedings in a book to be kept for that purpose; and shall perform like duties for the standing committees when required by the Board of Directors. He/she shall give, or cause to be given, notice of all meetings of the stockholders and of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors or these Bylaws.

He/she shall keep in safe custody the seal of the Corporation, and when authorized by the Board, affix the same to any instrument requiring it, and when so affixed it shall be attested by his/her signature or by the signature of an Assistant Secretary. The Board of Directors may give general authority to any other officer to affix the seal of the Corporation and to attest the affixing by his/her signature.

Section 10. Assistant Secretary. The Assistant Secretary, or if there be more than one, the Assistant Secretaries in the order determined by the Board of Directors, or if there be no such determination, the Assistant Secretary designated by the Board of Directors, shall, in the absence or disability of the Secretary, perform the duties and exercise the powers of the Secretary and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

 

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Section 11. Treasurer. The Treasurer, if such an officer be elected, shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation and shall deposit all moneys, and other valuable effects in the name and to the credit of the Corporation, in such depositories as may be designated by the Board of Directors. He/she shall disburse the funds of the Corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements, and shall render to the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all his/her transactions as Treasurer and of the financial condition of the Corporation. If required by the Board of Directors, he/she shall give the Corporation a bond, in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors, for the faithful performance of the duties of his/her office and for the restoration to the Corporation, in case of his/her death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his/her possession or under his/her control belonging to the Corporation.

Section 12. Assistant Treasurer. The Assistant Treasurer, or if there shall be more than one, the Assistant Treasurers in the order determined by the Board of Directors, or if there be no such determination, the Assistant Treasurer designated by the Board of Directors, shall, in the absence or disability of the Treasurer, perform the duties and exercise the powers of the Treasurer and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

 

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ARTICLE V.

CERTIFICATES OF STOCK

Section 1. Certificates. Every holder of stock of the Corporation shall be entitled to have a certificate signed by, or in the name of the Corporation by, the Chairman or Vice Chairman of the Board of Directors, or the President or a Vice President, and by the Secretary or an Assistant Secretary, or the Treasurer or an Assistant Treasurer of the Corporation, certifying the number of shares represented by the certificate owned by such stockholder in the Corporation.

Section 2. Signatures on Certificates. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer, transfer agent, or registrar at the date of issue.

Section 3. Statement of Stock Rights, Preferences, Privileges. If the Corporation shall be authorized to issue more than one class of stock or more than one series of any class, the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualification, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or back of the certificate which the Corporation shall issue to represent such class or series of stock, provided that, except as otherwise provided in Section 202 of the DGCL, in lieu of the foregoing requirements, there may be set forth on the face or back of the certificate which the Corporation shall issue to represent such class or series of stock, a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, designations,

 

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preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations and restrictions thereof.

Section 4. Lost Certificates. The Board of Directors may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the Corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate or certificates, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or his/her legal representative, to advertise the same in such manner as it shall require and/or to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation with respect to the certificate alleged to have been lost, stolen or destroyed.

Section 5. Transfers of Stock. Upon surrender to the Corporation, or the transfer agent of the Corporation, of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignation or authority to transfer, the Corporation shall issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its book.

Section 6. Fixing Record Date. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of the stockholders, or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for

 

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the purpose of any other lawful action, the Board of Directors may fix a record date which shall not be more than sixty nor less than ten days before the date of such meeting, nor more than sixty days prior to any other action. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

Section 7. Registered Stockholders. The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and accordingly shall not be bound to recognize any equitable or other claim or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, save as expressly provided by the laws of the State of Delaware.

ARTICLE VI.

GENERAL PROVISIONS

Section 1. Dividends. Dividends upon the capital stock of the Corporation, subject to the provisions of the Certificate of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the Certificate of Incorporation.

Section 2. Payment of Dividends. Before payment of any dividend there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve fund to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the

 

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Corporation, or for such other purpose as the directors shall think conducive to the interests of the Corporation, and the directors may abolish any such reserve.

Section 3. Checks. All checks or demands for money and notes of the Corporation shall be signed by such officer or officers as the Board of Directors may from time to time designate.

Section 4. Fiscal Year. The fiscal year of the Corporation shall end on December 31st of each year.

Section 5. Corporate Seal. The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization and the words “Corporate Seal, Delaware”. Said seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

Section 6. Manner of Giving Notice. Whenever, under the provisions of the DGCL or of the Certificate of Incorporation or of these Bylaws, notice is required to be given to any director or stockholder, it shall not be construed to mean personal notice, but such notice may be given in writing, by mail addressed to such director or stockholder, at his/her address as it appears on the records of the Corporation, with postage thereon prepaid if by mail, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail. Notice to directors or subject to the terms of the DGCL, stockholders, may also be given by telegram, facsimile or electronic mail.

Section 7. Waiver of Notice. Whenever any notice is required to be given under the provisions of the DGCL or of the Certificate of Incorporation or of these Bylaws, a

 

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waiver thereof in writing, signed by the person or persons entitled to said notice, or a waiver by electronic transmission by the person entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent to said notice.

Section 8. Annual Statement. The Board of Directors shall present at each annual meeting, and at any special meeting of the stockholders when called for by vote of the stockholders, a full and clear statement of the business and condition of the Corporation.

ARTICLE VII.

AMENDMENTS

Section 1. Amendment by Directors or Stockholders. These Bylaws may be altered, amended or repealed or new Bylaws may be adopted by the stockholders or by the Board of Directors at any regular meeting of the stockholders or of the Board of Directors or at any special meeting of the stockholders or of the Board of Directors if notice of such alteration, amendment, repeal or adoption of new Bylaws be contained in the notice of such special meeting. If the power to adopt, amend or repeal Bylaws is conferred upon the Board of Directors by the Certificate of Incorporation, it shall not divest or limit the power of the stockholders to adopt, amend or repeal Bylaws.

 

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EX-3.6 7 dex36.htm EXHIBIT 3.6 Exhibit 3.6

Exhibit 3.6

CERTIFICATE OF FORMATION

OF

PINAFORE, LLC

The undersigned, an authorized natural person, for the purpose of forming a limited liability company, under the provisions and subject to the requirements of the State of Delaware (particularly Chapter 18, Title 6 of the Delaware Code and the acts amendatory thereof and supplemental thereto, and known, identified, and referred to as the “Delaware Limited Liability Company Act”), hereby certifies that:

FIRST: The name of the limited liability company (hereinafter called the “limited liability company”) is:

Pinafore, LLC

SECOND: The address of the registered office and the name and the address of the registered agent of the limited liability company required to be maintained by Section 18-104 of the Delaware Limited Liability Company Act are:

The Corporation Trust Company

Corporation Trust Center

1209 Orange Street

Wilmington, New Castle County, Delaware 19801

THIRD: Notice is hereby given pursuant to Section 18-215(b) of the Delaware Limited Liability Company Act that the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to a particular series of the limited liability company shall be enforceable against the assets of such series only, and not against the assets of the limited liability company generally or any other series thereof, and, unless otherwise provided in the limited liability company agreement of the limited liability company, none of the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to the limited liability company generally or any other series thereof shall be enforceable against the assets of such series.

FOURTH: This Certificate of Formation shall be effective upon filing.

Executed on July 16, 2010

 

/s/ Eleanor C. Romanelli

Eleanor C. Romanelli
Authorized Person
 EX-3.7 8 dex37.htm EXHIBIT 3.7 Exhibit 3.7

Exhibit 3.7

CERTIFICATE OF AMENDMENT

TO

CERTIFICATE OF FORMATION

OF

PINAFORE, LLC

Pursuant to Section 18-202 of the Delaware Limited Liability Company Act, as amended, it is hereby certified that:

1. The name of the limited liability company (the “LLC”) is Pinafore, LLC.

2. The Certificate of Formation of the LLC is hereby amended by deleting Article 1 and inserting in lieu thereof a new Article 1 to read as follows:

FIRST: The name of the limited liability company (hereinafter called the “limited liability company”) is:

Tomkins, LLC.

IN WITNESS WHEREOF, the undersigned has executed this Certificate of Amendment to the Certificate of Formation on this 30th day of November, 2010.

 

By:  

/s/ Seth Mersky

  Name:   Seth Mersky
  Title:   President
 EX-3.8 9 dex38.htm EXHIBIT 3.8 Exhibit 3.8

Exhibit 3.8

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

OF

PINAFORE, LLC

This AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (this “Agreement”) of Pinafore, LLC (the “Company”) is effective as of September 28, 2010 and is entered into by The Gates Corporation, a Delaware corporation (“Gates”), and Tomkins Corporation, a Delaware corporation (“Tomkins” and, together with Gates, the “Members”).

WHEREAS, Pinafore Acquisitions Limited, a private limited company formed under the laws of the United Kingdom (the “Original Member”), entered into a limited liability agreement of the Company, effective as of July 27, 2010 (the “Original Agreement”), as the sole member;

WHEREAS, the Original Member and the Members have entered into a Purchase Agreement, dated as of the date hereof, pursuant to which the Original Member has sold, transferred and conveyed 64.70793984% of the membership interests in the Company (the “Membership Interests”) to Gates and 35.29206016% of the Membership Interests to Tomkins; and

WHEREAS, the Members desire to amend and restate the Original Agreement in its entirety.

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the undersigned, intending to be legally bound hereby, state the following:

1. Formation of Limited Liability Company. The Company was formed on July 16, 2010 as a limited liability company pursuant to the provisions of the Delaware Limited Liability Company Act, 6 Del. C §18-101, et seq. (as it may be amended from time to time, and any successor to such statute, the “Act”). The rights and obligations of the Members and the administration and termination of the Company shall be governed by this Agreement and the Act. This Agreement shall be considered the “Limited Liability Company Agreement” of the Company within the meaning of Section 18-101(7) of the Act. To the extent this Agreement is inconsistent in any respect with the Act, to the fullest extent permitted by the Act, this Agreement shall control. Each Member, as an authorized person, within the meaning of the Act, shall execute, deliver and file, or cause the execution, delivery and filing of, all certificates (and any amendments and/or restatements thereof) required or permitted by the Act to be filed in with the Secretary of State of the State of Delaware. Each Member shall execute, deliver and file, or cause the execution, delivery and filing of, any certificates (and any amendments and/or restatements thereof) necessary for the Company to qualify to do business in any other jurisdiction in which the Company may wish to conduct business.

2. Members. Each Member is hereby admitted as a member of the Company upon its execution and delivery of this Agreement. The percentage of Membership Interests held by each Member is set forth on Schedule A hereto.

3. Purpose. The purpose of the Company is to engage in any and all other lawful businesses or activities in which a limited liability company may be engaged under applicable law (including, without limitation, the Act).

4. Name. The name of the Company is Pinafore, LLC.

5. Registered Agent and Principal Office. The registered agent of the Company in the State of Delaware is Corporation Trust Company, whose address is 1209 Orange Street, Suite 400, Wilmington, New Castle County, Delaware 19801. The mailing address of the Company shall be 1551 Wewatta Street, Denver, Colorado 80202. The Company may have such other offices as the Majority Member (as defined below) may designate from time to time.

6. Term of Company. The Company shall continue in existence in perpetuity unless its business and affairs are earlier wound up following dissolution at such time as this Agreement may specify.

7. Management of Company. Except to the extent delegated to the Officers of the Company pursuant to Section 8 below or otherwise specified herein, all decisions relating to the business, affairs and properties of the Company shall be made by the Member(s) holding, in the aggregate, a majority of the Membership Interests held by all members of the Company (collectively, the “Majority Member”). Notwithstanding any provision of this Agreement, in no event shall the Company have, or take any actions to create, a board of managers or similar governing arrangement(s).

8. Designation of Officers.

(a) The Majority Member may, from time to time, designate officers of the Company and delegate to such officers such authority and duties as such Majority Member may deem advisable (the “Officers”) and may assign titles (including, without limitation, Chairman, Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, president, vice-president, secretary and/or treasurer) to any such Officer. Unless the Majority Member otherwise determines, if the title assigned to an Officer of the Company is one commonly used for officers of a business corporation formed under the Delaware General Corporation Law, then the assignment of such title shall constitute the delegation to such Officer of the authority and duties that are customarily associated with such office. Any number of titles may be held by the same Officer. Any Officer to whom a delegation is made (including any delegation contained in an employment agreement, subject to the limitations contained therein) shall serve in the capacity and have such powers as delegated unless and until such delegation is revoked by the Majority Member in whole or in part for any reason or no reason whatsoever, with or without cause, or such Officer resigns. The current Officers of the Company are set forth on Schedule B hereto.

(b) In addition to such other duties as may be delegated to any Officer of the Company, the President of the Company shall be the most senior officer of the Company and shall, subject to the control of the Majority Member, have general supervision, direction and control of the business and officers of the Company.

9. Reimbursement; Compensation. Each Officer shall be reimbursed for any actual costs reasonably incurred in connection with such Officer’s service as an officer of the Company.

10. Limitation of Liability; Indemnification; Duties.

(a) To the fullest extent permitted by law, none of (i) the Members (each in its capacity as a Member), (ii) the affiliates, agents, officers, partners, employees, representatives, directors, members or shareholders of any Member or the Company and (iii) each former officer, director, employee, or member (collectively, the “Indemnitees”) acting in accordance with this Agreement shall be liable, responsible, or accountable, in damages or otherwise, to the Company or the Members thereof for doing any act or failing to do any act, whether before, on or after the date hereof, the effect of which may cause or result in loss or damage to the Company or a Member if: (A) the act or failure to act of such Indemnitee was in good faith, in a manner it reasonably believed to be within the scope of such Indemnitee’s authority and in a manner it reasonably believed to be in, or not inconsistent with, the best interest of the Company; and (B) the conduct of such Person did not constitute fraud, willful misconduct, gross negligence or a material breach of this Agreement.

(b) The Company shall defend, indemnify and hold harmless any Indemnitee to the greatest extent permitted by law against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, proceedings, costs, expenses and disbursements of any kind or nature whatsoever, and all costs of investigation in connection therewith, as a result of any claim, threatened action or legal proceeding by any person (including, without limitation, by or through the Company, any subsidiary and/or a Member), or otherwise imposed upon or incurred by such Indemnitee, relating to the performance or nonperformance of any act concerning the activities of the Company or a subsidiary, whether before, on or after the date hereof, if: (i) the act or failure to act of such Indemnitee was in good faith, within the scope of such Indemnitee’s authority and in a manner it reasonably believed to be in, or not inconsistent with, the best interest of the Company or such subsidiary; and (ii) the conduct of such Indemnitee did not constitute fraud, willful misconduct, gross negligence or a material breach of a material provision of this Agreement. The indemnification authorized by this subsection (b) shall include any judgment, award, settlement, the payment of reasonable attorneys’ fees and other expense (not limited to taxable costs) incurred in settling or defending any claims, threatened action or finally adjudicated legal proceeding.

(c) From time to time, as requested by an Indemnitee hereunder, such attorneys’ fees and other expenses shall, unless the Majority Member determines that the Indemnitee has failed to meet the standards set forth in subsection (b) (taking into account, among other things, the availability of security for any repayment obligation on the part of the Indemnitee), be advanced by the Company prior to the final disposition of such claims, actions or proceedings upon receipt by the Company of an undertaking, reasonably acceptable to the

Majority Member, by or on behalf of such Indemnitee to repay such amounts if it shall be determined that such Indemnitee is not entitled to be indemnified as authorized hereunder.

(d) Any indemnification by the Company provided hereunder shall be satisfied solely out of assets of the Company as an expense of the Company (and the proceeds of any directors and officers insurance).

(e) The provisions of this Section 10 are for the benefit of the Indemnitees and their estate and heirs and shall not be deemed to create any rights for the benefit of any other person.

(f) The provisions of this Section 10 shall survive the termination of this Agreement. Any termination or amendment of this Section 10 shall not adversely affect any right or protection hereunder of any Indemnitee in respect of any act or omission prior to the time of such termination or amendment.

11. Capital Contributions. Each Member will make capital contributions to the Company, pro rata in accordance with the Members’ relative Percentage Interests, of certain property specified on Schedule C on or around September 29, 2010 and will make such other capital contributions in cash or other property at such times, in such amounts and for such purposes as the Members shall agree from time to time.

12. Distributions.

(a) Distributions will be made to the Members at the times and in the aggregate amounts, net of any reserves of the Company, determined in the Majority Member’s sole and absolute discretion. Any amounts distributed pursuant to this Section 12(a) will be made pro rata in accordance with the Member’s relative Percentage Interests as set forth on Schedule B hereof.

(b) Notwithstanding anything contrary contained herein, the Company will not make a distribution to any Member on the account of the interest of such Member in the Company if such distribution would violate Section 18-607 of the Act, and any Member receiving a distribution in violation of such provision will promptly return such distribution.

13. Capital Accounts. A Capital Account (“Capital Account”) will be established and maintained for each Member in accordance with the Internal Revenue Code of 1986, as amended (the “Code”) and the Treasury Regulations promulgated thereunder (the “Treasury Regulations” or the “Regulations”), including Treasury Regulations Sections 1.704-1(b) and 1.704-2. The Majority Member may in its discretion increase or decrease the Capital Accounts of the Members to reflect a revaluation of property of the Company on the Company’s books and records, but only in accordance with the rules set forth in Treasury Regulations Section 1.704-1(b)(2)(iv)(e) and (f). Following any such revaluation pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(f), the Members’ Capital Accounts will be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(g) for allocations of depreciation, depletion, amortization and gain or loss computed for book purposes with respect to such property.

14. Allocations of Net Profits and Net Losses.

(a) Net Profits and Net Losses (each as hereinafter defined) will be determined and allocated with respect to each fiscal year of the Company as of the end of such fiscal year and at such times as the Company property is revaluated in accordance with Section 13. Subject to the other provisions of this Section 14, an allocation to a Member of a share of Net Profits or Net Losses will be treated as an allocation of the same share of each item of income, gain, loss or deduction that is taken into account in computing Net Profits or Net Losses. Except as otherwise provided herein, Net Profits and Net Losses, and to the extent necessary, individuals items of income, gain, loss or deduction of the Company will be allocated among the Capital Accounts of the Members in a manner that as closely as possible gives economic effect to the provisions of Sections 13 and 17 and the other relevant provisions of this Agreement.

(b) Regulatory Allocations. Notwithstanding the foregoing provisions of Section 13(a), the following special allocations shall be made in the following order of priority:

 

  (i) Minimum Gain Chargeback. If there is a net decrease in Company Minimum Gain during a Company taxable year, then each Member shall be allocated items of Company income and gain for such taxable year (and, if necessary, for subsequent years) in an amount equal to such Member’s share of the net decrease in Company Minimum Gain, determined in accordance with Regulations Section 1.704-2(g)(2). This Section 14(b)(i) is intended to comply with the minimum gain chargeback requirement of Regulations Section 1.704-2(f) and shall be interpreted consistently therewith.

 

  (ii) Member Minimum Gain Chargeback. If there is a net decrease in Member Minimum Gain attributable to a Member Nonrecourse Debt during any Company taxable year, each Member who has a share of the Member Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(5), shall be specially allocated items of Company income and gain for such taxable year (and, if necessary, subsequent years) in an amount equal to such Member’s share of the net decrease in Company Minimum Gain attributable to such Company Nonrecourse Debt, determined in a manner consistent with the provisions of Regulations Section 1.704-2(g)(2). This Section 14(b)(ii) is intended to comply with the partner nonrecourse debt minimum gain chargeback requirement of Regulations Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

 

  (iii)

Qualified Income Offset. If any Member unexpectedly receives an adjustment, allocation or distribution of the type contemplated by Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of income and gain shall be allocated to all such Members (in proportion to the amounts of their respective deficit Adjusted Capital Accounts) in an amount and manner sufficient to eliminate the deficit balance in the Adjusted Capital Account of such Member as quickly as possible. It is

 

intended that this Section 13(b)(iii) qualify and be construed as a “qualified income offset” within the meaning of Regulations Section 1.704-1(b)(2)(ii)(d).

 

  (iv) Limitation on Allocation of Net Loss. If the allocation of Net Loss (or items of loss or deduction) to a Member as provided in Section 13(a) hereof would create or increase an Adjusted Capital Account deficit, there shall be allocated to such Member only that amount of Net Loss (or items of loss or deduction) as will not create or increase an Adjusted Capital Account deficit. The Net Loss (or items of loss or deduction) that would, absent the application of the preceding sentence, otherwise be allocated to such Member shall be allocated to the other Members in accordance with their relative Percentage Interests, subject to the limitations of this Section 14(b)(iv).

 

  (v) Certain Additional Adjustments. To the extent that an adjustment to the adjusted tax basis of any Company asset pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(2) or Regulations Section 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Member in complete liquidation of its Interest, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis), and such gain or loss shall be specially allocated to the Members in accordance with their Percentage Interests in the Company in the event that Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Members to whom such distribution was made in the event that Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

 

  (vi) Nonrecourse Deductions. The Nonrecourse Deductions for each taxable year of the Company shall be allocated to the Members in proportion to their respective capital contributions with respect to the Company investment giving rise to such Nonrecourse Deductions.

 

  (vii) Member Nonrecourse Deductions. The Member Nonrecourse Deductions shall be allocated each year to the Member that bears the economic risk of loss (within the meaning of Regulations Section 1.752-2) for the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable.

 

  (viii)

Curative Allocations. The allocations set forth in Section 14(b)(i) through (vii) hereof (the “Regulatory Allocations”) are intended to comply with certain requirements of Regulations Sections 1.704-1(b) and 1.704-2(i). Notwithstanding the provisions of Section 13(a), the Regulatory Allocations shall be taken into account in allocating other items of income, gain, loss and deduction among the Members so that, to the extent

 

possible, the net amount of such allocations of other items and the Regulatory Allocations to each Member shall be equal to the net amount that would have been allocated to each such Member if the Regulatory Allocations had not occurred.

(c) Tax Allocations.

 

  (i) Except as provided in Section 14(c)(ii) hereof, for income tax purposes under the Code and the Regulations, each item of income, gain, loss, deduction and credit shall be allocated between the Members as its correlative item of “book” income, gain, loss, deduction or credit is allocated pursuant to this Section 14.

 

  (ii) Tax items with respect to Company assets that are contributed to the Company with a Gross Asset Value that varies from its basis in the hands of the contributing Member immediately preceding the date of contribution shall be allocated between the Members for income tax purposes pursuant to Regulations promulgated under Code Section 704(c) so as to take into account such variation. The Company shall account for such variation under any method approved under Code Section 704(c) and the applicable Regulations as chosen by the Majority Member. If the Gross Asset Value of any Company asset is adjusted pursuant to the definition of “Gross Asset Value” herein, subsequent allocations of income, gain, loss, deduction and credit with respect to such Company asset shall take account of any variation between the adjusted basis of such Company asset for federal income tax purposes and its Gross Asset Value in a manner consistent with Code Section 704(c) and the Regulations promulgated thereunder under any method approved under Code Section 704(c) and the applicable Regulations as chosen by the Majority Member. Allocations pursuant to this Section 14(c)(ii) are solely for purposes of federal, state and local taxes and shall not affect, or in any way be taken into account in computing, any Member’s Capital Account or share of Net Profits, Net Losses and any other items or distributions pursuant to any provision of this Agreement.

(d) Other Tax Provisions.

 

  (i) For any fiscal year or other period during which any part of an Interest is transferred between the Members or to another person, the portion of the Net Profits, Net Losses and other items of income, gain, loss, deduction and credit that are allocable with respect to such part of such Interest shall be apportioned between the transferor and the transferee under any method allowed pursuant to Section 706 of the Code and the applicable Regulations as determined by the Majority Member.

 

  (ii)

In the event that the Code or any Regulations require allocations of items of income, gain, loss, deduction or credit different from those set forth in

 

this Section 14, the Majority Member is hereby authorized to make new allocations in reliance on the Code and such Regulations, and no such new allocation shall give rise to any claim or cause of action by any Member.

 

  (iii) For purposes of determining a Member’s proportional share of the Company’s “excess nonrecourse liabilities” within the meaning of Regulations Section 1.752-3(a)(3), each Member’s interest in Net Profits shall be equal to such Member’s share of Company distributions under Section 13 with respect to the investment for which the relevant excess nonrecourse liability is attributable.

(e) Definitions. As used in this Agreement, the following terms are defined as follows:

“Adjusted Capital Account” means, with respect to any Member, the balance in such Member’s Capital Account as of the end of the relevant fiscal year, after giving effect to the following adjustments:

(i) Add to such Capital Account the following items:

(A) The amount, if any, that such Member is obligated to contribute to the Company upon liquidation of such Member’s Interest; and

(B) The amount that such Member is obligated to restore or is deemed to be obligated to restore pursuant to Regulations Section 1.704-1(b)(2)(ii)(c) or the penultimate sentence of each of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and

(ii) Subtract from such Capital Account such Member’s share of the items described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

The foregoing definition of Adjusted Capital Account is intended to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

“Depreciation” means, for each fiscal year or other period, an amount equal to the depreciation, amortization or other cost recovery deduction allowable for federal income tax purposes with respect to an asset for such fiscal year or other period, except that if the Gross Asset Value of an asset differs from its adjusted basis for federal income tax purposes at the beginning of such fiscal year or other period, Depreciation shall be an amount that bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization or other cost recovery deduction for such year or other period bears to such beginning adjusted tax basis; provided, however, that if the federal income tax depreciation, amortization or other cost recovery deduction for such year or other period is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the Majority Member.

“Company Minimum Gain” has the meaning set forth in Regulations Sections 1.704-2(b)(2) and 1.704-2(d)(1) for the phrase “partnership minimum gain.”

“Gross Asset Value” means, with respect to any asset, the asset’s adjusted basis for federal income tax purposes, except as follows:

 

  (i) The initial Gross Asset Value of any asset contributed by a Member to the Company shall be the gross fair market value of such asset, as determined by the mutual consent of the Majority Member and the contributing Member.

 

  (ii) The Gross Asset Values of all Company assets immediately prior to the occurrence of any event described in subparagraphs (A) through (E) below shall be Majority Member using such reasonable method of valuation as it may adopt, as of the following times:

(A) the acquisition of an additional Interest by a new or existing Member in exchange for more than a de minimis capital contribution, if the Majority Member reasonably determines that such adjustment is necessary or appropriate to reflect the relative interests of the Members in the Company;

(B) the distribution by the Company to a Member of more than a de minimis amount of Company assets as consideration for an Interest, if the Majority Member reasonably determines that such adjustment is necessary or appropriate to reflect the relative interests of the Members in the Company;

(C) the liquidation or dissolution of the Company within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g);

(D) the grant of an Interest (other than a de minimis Interest) as consideration for the provision of services to or for the benefit of the Company by an existing Member acting in a partner capacity, or by a new Member acting in a partner capacity or in anticipation of becoming a Member of the Company, if the Majority Member reasonably determines that such adjustment is necessary or appropriate to reflect the relative interests of the Members in the Company; and

(E) at such other times as the Majority Member shall reasonably determine necessary or advisable in order to comply with Regulations Sections 1.704-1(b) and 1.704-2.

 

  (iii) The Gross Asset Value of any Company asset distributed to a Member shall be the gross fair market value of such asset on the date of distribution as determined by the Majority Member.

 

  (iv)

The Gross Asset Values of Company assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the

 

extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m); provided, however, that Gross Asset Values shall not be adjusted pursuant to this subparagraph (iv) to the extent that an adjustment pursuant to subparagraph (ii) above is made in connection with a transaction that would otherwise result in an adjustment pursuant to this subparagraph (iv).

“Member Minimum Gain” means an amount, with respect to each Member Nonrecourse Debt, equal to the Company Minimum Gain that would result if such Member Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with Regulations Section 1.704-2(i) with respect to “partner minimum gain.”

“Member Nonrecourse Debt” has the meaning set forth in Regulations Section 1.704-2(b)(4) for the phrase “partner nonrecourse debt.”

“Member Nonrecourse Deductions” has the meaning set forth in Regulations Section 1.704-2(i) for the phrase “partner nonrecourse deductions.”

“Net Profits” or “Net Losses” means, for each fiscal year or other period, an amount equal to the Company’s taxable income or loss for such year or period determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss, deduction or credit required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or loss), with the following adjustments:

 

  (i) Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Net Profits or Net Losses pursuant to this definition of Net Profits and Net Losses shall increase the amount of such income and/or decrease the amount of such loss;

 

  (ii) Any expenditure of the Company described in Code Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Net Profits or Net Losses pursuant to this definition of Net Profits and Net Losses, shall decrease the amount of such income and/or increase the amount of such loss;

 

  (iii) Gain or loss resulting from any disposition of Company assets where such gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of the Company assets disposed of, notwithstanding that the adjusted tax basis of such Company assets differs from its Gross Asset Value;

 

  (iv) In lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such income or loss, there shall be taken into account Depreciation for such fiscal year or other period;

  (v) To the extent an adjustment to the adjusted tax basis of any asset included in Company assets pursuant to Code Section 734(b) or Code Section 743(b) is required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member’s Interest, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the disposition of the asset and shall be taken into account for the purposes of computing Net Profits and Net Losses;

 

  (vi) If the Gross Asset Value of any Company asset is adjusted in accordance with subparagraph (ii) or subparagraph (iii) of the definition of “Gross Asset Value” above, the amount of such adjustment shall be taken into account in the taxable year of such adjustment as gain or loss from the disposition of such asset for purposes of computing Net Profits or Net Losses; and

 

  (vi) Notwithstanding any other provision of this definition of Net Profits and Net Losses, any items that are specially allocated pursuant to Section 13(b) hereof shall not be taken into account in computing Net Profits or Net Losses. The amounts of the items of Company income, gain, loss or deduction available to be specially allocated pursuant to Section 13(b) hereof shall be determined by applying rules analogous to those set forth in this definition of Net Profits and Net Losses.

“Nonrecourse Deductions” has the meaning set forth in Regulations Sections 1.704-2(b)(1) and 1.704-2(c).

“Nonrecourse Liability” has the meaning set forth in Regulations Sections 1.704-2(b)(3) and 1.752-1(a)(2).

15. Deficit Capital Account Balance. Notwithstanding anything to the contrary in this Agreement, if any Member has a deficit balance in the Member’s Capital Account (after giving effect to all capital contributions, distributions, allocations and other Capital Account adjustments for all taxable years, including the year during which such liquidation occurs), the Member will have no obligation to make any additional capital contribution to reduce or eliminate such deficit balance, and the deficit balance of the Member’s Capital Account will not be considered a debt owed by the Member to the Company or to any other person for any purpose whatsoever.

16. Tax Matters Member

(a) The Majority Member will be the Company’s “tax matters partner,” as provided in the Treasury Regulations under Code Section 6231 (the “Tax Matters Person”) and as such shall perform the duties as are required or appropriate thereunder. Each Member by his, her or its execution of this Agreement consents to the designation of the Tax Matters Person and

agrees to execute, certify, acknowledge, deliver, swear to, file and record at the appropriate public offices, such documents as may be necessary or appropriate to evidence such consent.

(b) The Tax Matters Person will have all the powers and duties assigned thereto under Section 6221-6232 of the Code and the Treasury Regulations thereunder. The Tax Matters Person will, at the expense of the Company, (i) cause to be prepared and filed all tax returns (including amended returns) required to be filed by the Company, and (ii) cause to be prepared and sent within 120 calendar days after each fiscal year end (or as soon as practicable thereafter) to each person who was a Member during such fiscal year, a copy of Schedule K-1 to Internal Revenue Service Form 1065 (or any successor form) indicating such Member’s share of the Company’s income, loss, gain, expense and other items relevant for U.S. federal income tax purposes.

17. Dissolution and Winding Up. The Company shall dissolve and its business and affairs shall be wound up upon (i) the written consent of all Members, (ii) any time there are no members of the Company unless the Company is continued in accordance with the Act, or (iii) the entry of a decree of judicial dissolution under Section 18-802 of the Act. After establishing reserves determined to be appropriate by the Majority Member, distributions to the Members in liquidation of the Company shall be made in accordance with positive capital account balances.

18. Amendments. This Agreement may be amended or modified from time to time only by a written instrument executed by all of the Members.

19. Governing Law. The validity and enforceability of this Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to otherwise governing principles of conflicts of law.

20. Assignments. A Member may at any time assign in whole or in part its Membership Interests. If a Member transfers any of its Membership Interests pursuant to this Section 20, the transferee shall be admitted to the Company as a member of the Company upon its execution of an instrument signifying its agreement to be bound by the terms and conditions of this Agreement. If a Member transfers all of its Membership Interests, such admission shall be deemed effective immediately prior to the transfer, and, immediately following such admission, the transferor Member shall cease to be a member of the Company.

21. Admission of Additional Members. One (1) or more additional members of the Company may be admitted to the Company with the consent of all of the Members or in accordance with Section 20 above.

[Signature page follows.]

The undersigned Members of the Company hereby adopt this Agreement as of the date first above written.

 

The Gates Corporation
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Signatory
Tomkins Corporation
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Signatory

[Amended and Restated LLC Agreement]

SCHEDULE A

Membership Interests

 

Member

   

Percentage of Membership Interests

The Gates Corporation

    64.70793984%

Tomkins Corporation

    35.29206016%

SCHEDULE B

Officers

 

Seth Mersky

    President

Tony Morgan

    Secretary

Konstantin Gilis

    Vice President

Sam Blaichman

    Vice President

Donald West

    Assistant Secretary

John Zimmerman

    Chief Financial Officer

SCHEDULE C

Capital Contributions

The Gates Corporation: (i) All of its rights and obligations as a payee and a holder with respect to the principal amount of $96,734,042.56 and accrued interest of $207,939.42 under that certain Amended and Restated Promissory Note dated as of September 28, 2010, in the principal amount of $1,009,000,000 issued by Tomkins US, LP, a Delaware limited partnership (“Tomkins”) in favor of Contributor (the “Tomkins Note”) and any other documents or instruments delivered pursuant thereto or in connection therewith or the loan transactions governed thereby or in any way based on or related to any of the foregoing including, without limitation, any guarantees associated therewith given with respect thereto (collectively with the Tomkins Note, the “Tomkins Note Documents”), (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of Gates against any person, whether known or unknown, arising under or in connection with the Tomkins Note, any other documents or instruments delivered pursuant thereto or in connection therewith or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations contributed, assigned and assumed pursuant to clause (i) above and (iii) for the avoidance of doubt, any other right, title, benefit and interest of any kind whatsoever in the Tomkins Note Documents not conveyed under that certain Purchase and Sale Agreement dated as of September 29, 2010 by and between Pinafore Acquisitions Limited, as seller, and the Company, as purchaser (the “Purchase and Sale Agreement”), under which Pinafore Acquisitions Limited sold, assigned and transferred a portion of its interests, rights and obligations in the Tomkins Note to the Company.

Tomkins Corporation: (i) All of its rights and obligations as a payee and a holder with respect to the principal amount of $49,822,628.08 and accrued interest of $3,050,052.91 under that certain Promissory Note dated as of September 20, 2010, in the aggregate principal amount of $1,850,000,000 issued by The Gates Corporation, a Delaware corporation (“Gates”) in favor of Gates Holdings Limited (as previously assigned and transferred to Contributor, the “Gates Note”) and any other documents or instruments delivered pursuant thereto or in connection therewith or the loan transactions governed thereby or in any way based on or related to any of the foregoing including, without limitation, any guarantees associated therewith given with respect thereto (collectively with the Gates Note, the “Gates Note Documents”), (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of Tomkins against any person, whether known or unknown, arising under or in connection with the Gates Note, any other documents or instruments delivered pursuant thereto or in connection therewith or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations contributed, assigned and assumed pursuant to clause (i) above and (iii) for the avoidance of doubt, any other right, title, benefit and interest of any kind whatsoever in the Gates Note Documents not conveyed under that certain Purchase and Sale Agreement dated as of

September 29, 2010 by and between Pinafore Acquisitions Limited, as seller, and the Company, as purchaser (the “Purchase and Sale Agreement”), under which Pinafore Acquisitions Limited sold, assigned and transferred a portion of its interests, rights and obligations in the Gates Note to the Company.

EX-4.1 10 dex41.htm EXHIBIT 4.1 Exhibit 4.1

Exhibit 4.1

PINAFORE, LLC and

PINAFORE, INC.

as Issuers,

PINAFORE HOLDINGS, B.V.

as Holdings

and the Note Guarantors named herein

9% Senior Secured Second Lien Notes due 2018

 

 

INDENTURE

Dated as of September 29, 2010

 

 

WILMINGTON TRUST FSB,

as Trustee and Collateral Agent

 

 

 

CROSS-REFERENCE TABLE*

 

   TIA

Section

    Indenture
Section

310(a)(1)

    7.10

      (a)(2)

    7.10

      (a)(3)

    N/A

      (a)(4)

    N/A

      (a)(5)

    7.10

      (b)

    7.08; 7.10

      (c)

    N/A

      311(a)

    7.11

      (b)

    7.11

      (c)

    N/A

      312(a)

    2.06

      (b)

    12.03

      (c)

    12.03

      313(a)

    7.06

      (b)(1)

    N/A

      (b)(2)

    7.06; 7.07

      (c)

    7.06; 12.02

      (d)

    7.06

314(a)

    4.02; 4.09;
12.02; 12.05

      (b)

    N/A

      (c)(1)

    12.04

      (c)(2)

    12.04

      (c)(3)

    N/A

      (d)

    N/A

      (e)

    12.05

      (f)

    N/A

315(a)

    7.01

      (b)

    7.05; 12.02

      (c)

    7.01

      (d)

    7.01

      (e)

    6.11

316(a) (last sentence)

    12.06

      (a)(1)(A)

    6.05

      (a)(1)(B)

    6.04

      (a)(2)

    N/A

      (b)

    6.07

      (c)

    2.12; 9.04

317(a)(1)

    6.08

      (a)(2)

    6.09

      (b)

    2.05

  TIA

Section

    Indenture
Section		  

318(a)

      12.01   

      (b)

      N/A   

      (c)

      12.01   

 

N/A means not applicable.
* This Cross-Reference table is not part of the Indenture.

TABLE OF CONTENTS

 

          Page  
ARTICLE 1   
DEFINITIONS AND INCORPORATION BY REFERENCE   

SECTION 1.01.

    Definitions      1   

SECTION 1.02.

    Other Definitions      36   

SECTION 1.03.

    Incorporation by Reference of Trust Indenture Act      38   

SECTION 1.04.

    Rules of Construction      38   
ARTICLE 2   
THE SECURITIES   

SECTION 2.01.

    Amount of Securities; Issuable in Series      39   

SECTION 2.02.

    Form and Dating      40   

SECTION 2.03.

    Execution and Authentication      40   

SECTION 2.04.

    Registrar and Paying Agent      41   

SECTION 2.05.

    Paying Agent to Hold Money in Trust      42   

SECTION 2.06.

    Holder Lists      42   

SECTION 2.07.

    Transfer and Exchange      42   

SECTION 2.08.

    Replacement Securities      43   

SECTION 2.09.

    Outstanding Securities      44   

SECTION 2.10.

    Temporary Securities      44   

SECTION 2.11.

    Cancellation      44   

SECTION 2.12.

    Defaulted Interest      44   

SECTION 2.13.

    CUSIP Numbers, ISINs, etc.      45   

SECTION 2.14.

    Calculation of Specified Percentage of Securities      45   

SECTION 2.15.

    No Listing of the Securities      45   
ARTICLE 3   
REDEMPTION   

SECTION 3.01.

    Redemption      45   

SECTION 3.02.

    Applicability of Article      45   

SECTION 3.03.

    Notices to Trustee      46   

SECTION 3.04.

    Selection of Securities to Be Redeemed      46   

SECTION 3.05.

    Notice of Optional Redemption      46   

SECTION 3.06.

    Effect of Notice of Redemption      47   

SECTION 3.07.

    Deposit of Redemption Price      47   

SECTION 3.08.

    Securities Redeemed in Part      48   

 

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ARTICLE 4   
COVENANTS   

SECTION 4.01.

    Payment of Securities      48   

SECTION 4.02.

    Reports and Other Information      48   

SECTION 4.03.

    Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock      50   

SECTION 4.04.

    Limitation on Restricted Payments      55   

SECTION 4.05.

    Dividend and Other Payment Restrictions Affecting Subsidiaries      62   

SECTION 4.06.

    Asset Sales      64   

SECTION 4.07.

    Transactions with Affiliates      68   

SECTION 4.08.

    Change of Control      71   

SECTION 4.09.

    Compliance Certificate      73   

SECTION 4.10.

    Future Guarantors      73   

SECTION 4.11.

    Liens      74   

SECTION 4.12.

    Maintenance of Office or Agency      74   

SECTION 4.13.

    Discharge and Suspension of Covenants      74   

SECTION 4.14.

    Maintenance of Insurance      75   

SECTION 4.15.

    Further Assurances      75   

SECTION 4.16.

    Additional Collateral      76   
ARTICLE 5   
SUCCESSOR COMPANY   

SECTION 5.01.

    When Issuers May Merge or Transfer Assets      76   
ARTICLE 6   
DEFAULTS AND REMEDIES   

SECTION 6.01.

    Events of Default      78   

SECTION 6.02.

    Acceleration      80   

SECTION 6.03.

    Other Remedies      81   

SECTION 6.04.

    Waiver of Past Defaults      81   

SECTION 6.05.

    Control by Majority      81   

SECTION 6.06.

    Limitation on Suits      82   

SECTION 6.07.

    Rights of the Holders to Receive Payment      82   

SECTION 6.08.

    Collection Suit by Trustee      82   

SECTION 6.09.

    Trustee May File Proofs of Claim      82   

SECTION 6.10.

    Priorities      83   

SECTION 6.11.

    Undertaking for Costs      83   

SECTION 6.12.

    Waiver of Stay or Extension Laws      83   

ARTICLE 7   
TRUSTEE AND COLLATERAL AGENT   

SECTION 7.01.

    Duties of Trustee and Collateral Agent      84   

SECTION 7.02.

    Rights of Trustee and Collateral Agent      85   

SECTION 7.03.

    Individual Rights of Trustee and Collateral Agent      86   

SECTION 7.04.

    Trustee’s and Collateral Agent’s Disclaimer      86   

SECTION 7.05.

    Notice of Defaults      87   

SECTION 7.06.

    Reports by Trustee to the Holders      87   

SECTION 7.07.

    Compensation and Indemnity      87   

SECTION 7.08.

    Replacement of Trustee and Collateral Agent      88   

SECTION 7.09.

    Successor Trustee and Successor Collateral Agent by Merger      89   

SECTION 7.10.

    Eligibility; Disqualification      90   

SECTION 7.11.

    Preferential Collection of Claims Against Issuers      90   
ARTICLE 8   
DISCHARGE OF INDENTURE; DEFEASANCE   

SECTION 8.01.

    Discharge of Liability on Securities; Defeasance      90   

SECTION 8.02.

    Conditions to Defeasance      91   

SECTION 8.03.

    Application of Trust Money      93   

SECTION 8.04.

    Repayment to Issuers      93   

SECTION 8.05.

    Indemnity for U.S. Government Obligations      93   

SECTION 8.06.

    Reinstatement      93   
ARTICLE 9   
AMENDMENT, SUPPLEMENT AND WAIVER   

SECTION 9.01.

    Without Consent of the Holders      93   

SECTION 9.02.

    With Consent of the Holders      96   

SECTION 9.03.

    Compliance with Trust Indenture Act      97   

SECTION 9.04.

    Revocation and Effect of Consents and Waivers      97   

SECTION 9.05.

    Notation on or Exchange of Securities      97   

SECTION 9.06.

    Trustee to Sign Amendments      98   

SECTION 9.07.

    Payment for Consent      98   

SECTION 9.08.

    Additional Voting Terms; Calculation of Principal Amount      98   
ARTICLE 10   
COLLATERAL   

SECTION 10.01.

    Collateral Documents      98   

SECTION 10.02.

    Collateral Agent.      99   

SECTION 10.03.

    Authorization of Actions to be Taken      100   

SECTION 10.04.

    Release of Collateral      100   

SECTION 10.05.

    Powers Exercisable by Receiver or Trustee      101   

SECTION 10.06.

    Release upon Termination of the Issuer’s Obligations      102   

SECTION 10.07.

    Designations      102   

SECTION 10.08.

    Post-Closing Collateral      102   

SECTION 10.09.

    Parallel Debt      105   
ARTICLE 11   
NOTE GUARANTEES   

SECTION 11.01.

    Note Guarantees      106   

SECTION 11.02.

    Limitation on Note Guarantor Liability      109   

SECTION 11.03.

    No Waiver      114   

SECTION 11.04.

    Modification      114   

SECTION 11.05.

    Execution of Supplemental Indenture for Future Guarantors      114   

SECTION 11.06.

    Non-Impairment      115   
ARTICLE 12   
MISCELLANEOUS   

SECTION 12.01.

    Trust Indenture Act Controls      115   

SECTION 12.02.

    Notices      115   

SECTION 12.03.

    Communication by the Holders with Other Holders      116   

SECTION 12.04.

    Certificate and Opinion as to Conditions Precedent      116   

SECTION 12.05.

    Statements Required in Certificate or Opinion      116   

SECTION 12.06.

    When Securities Disregarded      117   

SECTION 12.07.

    Rules by Trustee, Paying Agent and Registrar      117   

SECTION 12.08.

    Legal Holidays      117   

SECTION 12.09.

    Governing Law      117   

SECTION 12.10.

    No Recourse Against Others      118   

SECTION 12.11.

    Successors      119   

SECTION 12.12.

    Multiple Originals      119   

SECTION 12.13.

    Table of Contents; Headings      119   

SECTION 12.14.

    Indenture Controls      119   

SECTION 12.15.

    Severability      119   

SECTION 12.16.

    Waiver of Jury Trial      119   

Appendix A –

    Provisions Relating to Initial Securities, Additional Securities and Exchange Securities

EXHIBIT INDEX

 

Exhibit A      –         Initial Security
Exhibit B      –         Exchange Security
Exhibit C      –         Form of Transferee Letter of Representation
Exhibit D      –         Form of Supplemental Indenture

INDENTURE dated as of September 29, 2010 among PINAFORE, LLC, a Delaware limited liability company (“Finance LLC”), PINAFORE, INC., a Delaware corporation (“Finance Co” and together with Finance LLC, each an “Issuer” and together, the “Issuers”), PINAFORE HOLDINGS, B.V. (“Holdings”), the Note Guarantors and WILMINGTON TRUST FSB, a federal savings bank, as trustee (in such capacity, the “Trustee”) and as Collateral Agent (in such capacity, the “Collateral Agent”).

Each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of (a) $1,150,000,000 aggregate principal amount of the Issuers’ 9% Senior Secured Second Lien Notes due October 1, 2018 (the “Original Securities”) issued on the date hereof, (b) any Additional Securities that may be issued after the date hereof in the form of Exhibit A (all such securities in clauses (a) and (b) being referred to collectively as the “Initial Securities”) and (c) if and when issued as provided in the Registration Rights Agreement or otherwise registered under the Securities Act and issued, the Issuers’ 9% Senior Secured Second Lien Notes due October 1, 2018 (the “Exchange Securities” and, together with the Initial Securities, the “Securities”) issued in the Registered Exchange Offer in exchange for any Initial Securities or otherwise registered under the Securities Act and issued in the form of Exhibit B. Subject to the conditions and compliance with the covenants set forth herein, the Issuers may issue an unlimited aggregate principal amount of Additional Securities.

ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01. Definitions.

“Acquired Indebtedness” means, with respect to any specified Person:

(1) Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Restricted Subsidiary of such specified Person whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Subsidiary of such specified Person, and

(2) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

“Additional Interest” means all additional interest then owing pursuant to the Registration Rights Agreement.

“Additional Second Lien Obligations” means the “Additional Second Priority Debt Obligations” as defined in the Second Lien Intercreditor Agreement.

“Additional Securities” means Securities issued from time to time under this Indenture subsequent to the Issue Date.

“Additional Senior Obligations” means the “Additional Senior Debt Obligations” as defined in the Second Lien Intercreditor Agreement.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.

“Appendix” means Appendix A attached hereto.

“Applicable Premium” means, with respect to any Security on any applicable redemption date, the greater of:

(1) 1.0% of the then outstanding principal amount of the Security; and

(2) the excess of:

(a) the present value at such redemption date of (i) the redemption price of the Securities, at October 1, 2014 as set forth in Paragraph 5 of the applicable Security plus (ii) all required interest payments due on such Security through October 1, 2014 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over

(b) the then outstanding principal amount of the Security.

“Asset Sale” means:

(1) the sale, conveyance, transfer or other disposition (whether in a single transaction or a series of related transactions) of property or assets (including by way of a Sale/Leaseback Transaction) of Holdings or any Restricted Subsidiary of Holdings (each referred to in this definition as a “disposition”) or

(2) the issuance or sale of Equity Interests (other than directors’ qualifying shares or shares or interests required to be held by foreign nationals or other third parties to the extent required by applicable law) of any Restricted Subsidiary of Holdings (other than to Holdings or another Restricted Subsidiary of Holdings) (whether in a single transaction or a series of related transactions), in each case other than:

(a) a sale, exchange or other disposition of cash, Cash Equivalents or Investment Grade Securities or obsolete, damaged, unnecessary, unsuitable or worn out equipment in the ordinary course of business;

 

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(b) the sale, conveyance or other disposition of all or substantially all of the assets of Holdings in a manner permitted pursuant to Section 5.01 or any disposition that constitutes a Change of Control;

(c) any Permitted Investment or Restricted Payment that is permitted to be made, and is made, under Section 4.04;

(d) any disposition of assets or issuance or sale of Equity Interests of any Restricted Subsidiary with an aggregate Fair Market Value of less than $15.0 million;

(e) any transfer or disposition of property or assets by a Restricted Subsidiary of Holdings to Holdings or by Holdings or a Restricted Subsidiary of Holdings to a Restricted Subsidiary of Holdings;

(f) sales of assets received by Holdings or any of its Restricted Subsidiaries upon the foreclosure on a Lien;

(g) any issuance or sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;

(h) the sale, lease, assignment, license or sublease of inventory, equipment, accounts receivable or other current assets held for sale in the ordinary course of business including, without limitation, any Collateral;

(i) the lease, assignment or sublease of any real or personal property in the ordinary course of business;

(j) a sale of accounts receivable and related assets of the type specified in the definition of “Receivables Financing” to a Receivables Subsidiary in a Qualified Receivables Financing or in factoring or similar transactions;

(k) a transfer of accounts receivable and related assets of the type specified in the definition of “Receivables Financing” (or a fractional undivided interest therein) by a Receivables Subsidiary in a Qualified Receivables Financing;

(l) any exchange of assets for assets (including a combination of assets and Cash Equivalents) related to a Similar Business of comparable or greater market value or usefulness to the business of Holdings and its Restricted Subsidiaries as a whole, as determined in good faith by the Issuers, which in the event of an exchange of assets with a Fair Market Value in excess of (1) $25.0 million shall be evidenced by an Officer’s Certificate, and (2) $50.0 million shall be set forth in a resolution approved in good faith by at least a majority of the Board of Directors of the Issuers;

 

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(m) the grant in the ordinary course of business of any license or sub-license of patents, trademarks, know-how and any other intellectual property;

(n) any sale or other disposition deemed to occur with creating, granting or perfecting a Lien not otherwise prohibited by the Indenture or the note documents;

(o) the surrender or waiver or contract rights or settlement, release or surrender of a contract, tort or other litigation claim in the ordinary course of business;

(p) foreclosures, condemnations or any similar action on assets; and

(q) the sale (without recourse) of receivables (and related assets) pursuant to factoring arrangements entered into in the ordinary course of business.

“Board of Directors” means as to any Person, the board of directors or managers, sole member or managing member, as applicable, of such Person (or, if such Person is a partnership, the board of directors or other governing body of the general partner of such Person) or any duly authorized committee thereof.

“Business Day” means a day other than a Saturday, Sunday or other day on which banking institutions are authorized or required by law to close in New York City.

“Capital Stock” means:

(1) in the case of a corporation, corporate stock;

(2) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;

(3) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and

(4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

“Capitalized Lease Obligation” means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the footnotes thereto) in accordance with IFRS-EU.

“Cash Contribution Amount” means the aggregate amount of cash contributions made to the capital of the Issuers or any Note Guarantor described in the definition of “Contribution Indebtedness.”

 

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“Cash Equivalents” means:

(1) U.S. Dollars, pounds sterling, euros, the national currency of any participating member state of the European Union or, in the case of any Foreign Subsidiary that is a Restricted Subsidiary, such local currencies held by it from time to time in the ordinary course of business;

(2) securities issued or directly and fully guaranteed or insured by the government of the United States or any country that is a member of the European Union or any agency or instrumentality thereof in each case with maturities not exceeding two years from the date of acquisition;

(3) certificates of deposit, time deposits and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers’ acceptances, in each case with maturities not exceeding one year, and overnight bank deposits, in each case with any commercial bank having capital and surplus in excess of $500 million, or the foreign currency equivalent thereof, and whose long-term debt is rated “A” or the equivalent thereof by Moody’s or S&P (or reasonably equivalent ratings of another internationally recognized ratings agency);

(4) repurchase obligations for underlying securities of the types described in clauses (2) and (3) above entered into with any financial institution meeting the qualifications specified in clause (3) above;

(5) commercial paper issued by a corporation (other than an Affiliate of Holdings) rated at least “A-1” or the equivalent thereof by Moody’s or S&P (or reasonably equivalent ratings of another internationally recognized ratings agency) and in each case maturing within one year after the date of acquisition;

(6) readily marketable direct obligations issued by any state of the United States of America or any political subdivision thereof having one of the two highest rating categories obtainable from either Moody’s or S&P (or reasonably equivalent ratings of another internationally recognized ratings agency) in each case with maturities not exceeding two years from the date of acquisition;

(7) Indebtedness issued by Persons (other than the Sponsor or any of its Affiliates) with a rating of “A” or higher from S&P or “A-2” or higher from Moody’s in each case with maturities not exceeding two years from the date of acquisition;

(8) investment funds investing at least 95% of their assets in securities of the types described in clauses (1) through (7) above; and

(9) instruments equivalent to those referred to in clauses (1) through (7) above denominated in Euro or Sterling or any other foreign currency comparable in credit quality and tenor to those referred to above and customarily used by corporations for cash management purposes in any jurisdiction outside the United States to the extent reasonably required in connection with (a) any business conducted by any Restricted Subsidiary

 

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organized in such jurisdiction or (b) any Investment in the jurisdiction where such Investment is made.

“Change of Control” means the occurrence of any of the following events:

(i) the sale, lease or transfer, in one or a series of related transactions, of all or substantially all the assets of Holdings and its Subsidiaries, taken as a whole, to a Person other than any of the Permitted Holders; or

(ii) Holdings becomes aware (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) of the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than any of the Permitted Holders, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision), of more than 50% of the total voting power of the Voting Stock of Holdings or any direct or indirect parent of Holdings.

Notwithstanding the foregoing, no Specified Merger/Transfer Transaction shall constitute a Change of Control.

“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time.

“COLI Loan” means those certain loans borrowed from time to time by The Gates Corporation against group life insurance policies from Mass Mutual (or any successor thereto) and the associated group life insurance policies.

“Collateral” means substantially all existing and future property and assets (other than Excluded Assets, as applicable).

“Collateral Agent” means Wilmington Trust FSB, in its capacity as “Collateral Agent” under this Indenture and any successor thereto or any subagent or designee thereof.

“Collateral Documents” means, collectively, the Second Lien Intercreditor Agreement, the Security Agreement, other security agreements relating to the Collateral for the benefit of the Holders and the Mortgages and instruments filed and recorded in appropriate jurisdictions to preserve and protect the Liens on the Collateral for the benefit of the Holders (including, without limitation, financing statements under the Uniform Commercial Code of the relevant states) applicable to the Collateral, each as in effect on the Issue Date or at the time such documents are entered into and as amended, amended and restated, modified, renewed or replaced from time to time.

 

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“Consolidated Interest Expense” means, with respect to any Person and its Restricted Subsidiaries for any period, the sum, without duplication, of:

(1) interest expense of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, to the extent such expense was deducted in computing Consolidated Net Income (including amortization of original issue discount, the interest component of Capitalized Lease Obligations, and net payments and receipts (if any) pursuant to interest rate Hedging Obligations and excluding amortization of deferred financing fees and expensing of any bridge or other financing fees, the non-cash portion of interest expense resulting from the reduction in the carrying value under purchase accounting of the Issuers’ outstanding Indebtedness and commissions, discounts, yield and other fees and charges (including any interest but excluding the interest component associated with COLI Loans and any pension or other post-employment benefit expense) related to any Receivables Financing); and

(2) consolidated capitalized interest of such Person and its Restricted Subsidiaries for such period, whether paid or accrued;

less interest income for such period;

provided that, for purposes of calculating Consolidated Interest Expense, no effect shall be given to any interest expense associated with the Loan Notes, or interest income earned on amounts in the Loan Note Escrow Agreement, or to the discount and/or premium resulting from the bifurcation of derivatives under FASB ASC 815 and related interpretations as a result of the terms of the Indebtedness to which such Consolidated Interest Expense relates.

For purposes of this definition, interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by the Issuers to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with IFRS-EU.

“Consolidated Net Income” means, with respect to Holdings and its Restricted Subsidiaries for any period, the aggregate of the Net Income of Holdings and its Restricted Subsidiaries for such period, on a consolidated basis; provided, however, that:

(1) any net after-tax extraordinary, nonrecurring, non-operating or unusual gains or losses or income or expenses (including the effect of all fees and expenses relating thereto), including, without limitation, any expenses related to any reconstruction, any severance or relocation expenses and fees, any restructuring costs, any retention payments, any expenses or charges related to any Equity Offering, Permitted Investment, acquisition (including earn-out provisions) or Indebtedness permitted to be Incurred by this Indenture (in each case, whether or not successful) and any fees, expenses, charges or payments made under or contemplated by the Scheme or otherwise related to the Transactions, shall be excluded;

(2) the Net Income for such period shall not include the cumulative effect of a change in accounting principles during such period;

 

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(3) any net after-tax income or loss from discontinued operations and any net after-tax gains or losses on disposal of discontinued operations shall be excluded;

(4) any net after-tax gains or losses (including the effect of all fees and expenses or charges relating thereto) attributable to business dispositions or asset dispositions other than in the ordinary course of business (as determined in good faith by the Issuers) shall be excluded;

(5) any net after-tax gains or losses (including the effect of all fees and expenses or charges relating thereto) attributable to the early extinguishment of Indebtedness shall be excluded;

(6) the Net Income for such period of any Person that is not a Subsidiary of such Person, or is an Unrestricted Subsidiary, or that is accounted for by the equity method of accounting (other than a Note Guarantor), shall be included only to the extent of the amount of dividends or distributions or other payments paid in cash (or to the extent converted into cash) to Holdings or a Restricted Subsidiary thereof in respect of such period;

(7) solely for the purpose of determining the amount available for Restricted Payments under Section 4.04(a)(3)(A), the Net Income for such period of any Restricted Subsidiary (other than any Note Guarantor) shall be excluded to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary of its Net Income is not at the date of determination permitted without any prior governmental approval (which has not been obtained) or, directly or indirectly, by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders, unless such restrictions with respect to the payment of dividends or similar distributions have been legally waived; provided that (x) the net loss of any such Restricted Subsidiary shall be included therein and (y) the Consolidated Net Income of Holdings shall be increased by the amount of dividends or other distributions or other payments actually paid in cash (or converted into cash) by any such Restricted Subsidiary to Holdings, to the extent not already included therein;

(8) an amount equal to the amount of Tax Distributions actually made to the Holders of Capital Stock of such Person or any parent company of such Person in respect of such period in accordance with Section 4.04(b)(xii) shall be included as though such amounts had been paid as income taxes directly by such Person for such period;

(9) any non-cash impairment charges, goodwill write-off or asset write-off resulting from the application of IFRS-EU, and the amortization of intangibles arising under IFRS-EU, shall be excluded;

(10) any non-cash compensation expense realized from employee benefit plans or other post-employment benefit plans, grants of stock appreciation or similar rights, stock options or other rights to officers, directors and employees of such Person or any of its Restricted Subsidiaries shall be excluded;

 

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(11) (a)(i) the non-cash portion of “straight-line” rent expense shall be excluded and (ii) the cash portion of “straight-line” rent expense that exceeds the amount expensed in respect of such rent expense shall be included and (b) non-cash gains, losses, income and expenses resulting from fair value accounting required by IFRS-EU shall be excluded;

(12) unrealized gains and losses relating to hedging transactions and mark-to-market of Indebtedness resulting from the application of IFRS-EU shall be excluded;

(13) any (a) severance or relocation costs or expenses, (b) one-time non-cash compensation charges, (c) the costs and expenses after the Issue Date related to employment of terminated employees, or (d) costs or expenses realized in connection with or resulting from stock appreciation or similar rights, stock options or other rights existing on the Issue Date of officers, directors and employees, in each case of Holdings or any of its Restricted Subsidiaries, shall be excluded;

(14) effects of purchase accounting adjustments (including the effects of such adjustments pushed down to Holdings and its Restricted Subsidiaries) in amounts required or permitted by IFRS-EU (including in the inventory, property and equipment, software, goodwill, intangible assets, in-process research and development, post-employment benefits, deferred revenue and debt line items thereof) and related authoritative pronouncements (including the effects of such adjustments pushed down to Holdings and the Restricted Subsidiaries), resulting from the application of purchase accounting in relation to the Transactions or any consummated acquisition or the amortization or write-off of any amounts thereof shall be excluded;

(15) accruals and reserves, contingent liabilities, and any gains and losses on the settlement of any pre-existing contractual or non-contractual relationships as a result of the Transactions that are established or adjusted within 12 months after the Issue Date and that are so required to be established or adjusted in accordance with IFRS-EU or as a result of adoption or modification of accounting policies shall be excluded; and

(16) solely for purposes of calculating EBITDA, the Net Income of Holdings and its Restricted Subsidiaries shall be calculated without deducting the income attributable to, or adding the losses attributable to, the minority equity interests of third parties in any non-Wholly Owned Restricted Subsidiary except to the extent of dividends declared or paid in respect of such period or any prior period on the shares of Capital Stock of such Restricted Subsidiary held by such third parties shall be included.

Notwithstanding the foregoing, for the purpose of Section 4.04 only, there shall be excluded from Consolidated Net Income any dividends, repayments of loans or advances or other transfers of assets from Unrestricted Subsidiaries of Holdings or a Restricted Subsidiary of Holdings to the extent such dividends, repayments or transfers increase the amount of Restricted Payments permitted under Sections 4.04(a)(3)(E) and (F).

“Consolidated Non-cash Charges” means, with respect to Holdings and its Restricted Subsidiaries for any period, the aggregate depreciation, amortization (including

 

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amortization of intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period), impairment, compensation, rent and other non-cash expenses of such Person and its Restricted Subsidiaries reducing Consolidated Net Income of such Person for such period on a consolidated basis and otherwise determined in accordance with IFRS-EU; provided that if any non-cash charges referred to in this definition represent an accrual or reserve for any potential cash items in any future period, the cash payment in respect thereof in such future period shall be subtracted from EBITDA in such future period to such extent paid..

“Consolidated Senior Secured Debt Ratio” as of any date of determination means the ratio of (1) (x) Consolidated Total Indebtedness of Holdings and its Restricted Subsidiaries that is secured by a Lien minus (y) the aggregate amount of cash and Cash Equivalents (which shall be free and clear of any Liens) of Holdings and its Restricted Subsidiaries determined on a consolidated basis as reflected on the balance sheet in accordance with IFRS-EU, in each case of clause (x) and (y) as of the most recent fiscal period for which internal financial statements are available immediately preceding the date on which such event for which such calculation is being made shall occur to (2) the EBITDA of Holdings and its Restricted Subsidiaries for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such event for which such calculation is being made shall occur, in each case, with such pro forma adjustments to Consolidated Total Indebtedness and EBITDA as are appropriate and consistent with the pro forma adjustment provisions set forth in the definition of “Fixed Charge Coverage Ratio” (except that, for purposes of determining the amount of Consolidated Total Indebtedness pursuant to clause (1) of this definition, the amount of revolving Indebtedness under the Credit Agreement and any other revolving credit facility shall be computed based upon the period-ending value of such Indebtedness during the applicable period).

“Consolidated Taxes” means, with respect to Holdings and its Restricted Subsidiaries any Person and its Restricted Subsidiaries on a consolidated basis for any period, provision for taxes based on income, profits or capital, including, without limitation, state franchise and similar taxes, and including an amount equal to the amount of tax distributions actually made to the Holders of Capital Stock of such Person or any direct or indirect parent of such Person in respect of such period in accordance with Section 4.04(b)(xii) which shall be included as though such amounts had been paid as income taxes directly by such Person.

“Consolidated Total Indebtedness” means, as of any date of determination, the aggregate principal amount of Indebtedness of Holdings and its Restricted Subsidiaries outstanding on such date, determined on a consolidated basis, to the extent required to be recorded on a balance sheet in accordance with IFRS-EU, consisting of Indebtedness for borrowed money, Capitalized Lease Obligations and debt obligations evidenced by promissory notes or similar instruments.

“Contingent Obligations” means, with respect to any Person, any obligation of such Person guaranteeing any leases, dividends or other obligations that do not constitute Indebtedness (referred to in this definition as the “primary obligations”) of any other Person (referred to in this definition as the “primary obligor”) in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent:

 

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(1) to purchase any such primary obligation or any property constituting direct or indirect security therefor,

(2) to advance or supply funds:

(a) for the purchase or payment of any such primary obligation; or

(b) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; or

(3) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.

“Contribution Indebtedness” means Indebtedness of the Issuers or any Note Guarantor in an aggregate principal amount not greater than the aggregate amount of cash contributions (other than Excluded Contributions) made to the capital of Holdings after the Issue Date, provided that:

(1) such Contribution Indebtedness shall be Indebtedness with a Stated Maturity later than the Stated Maturity of the Securities, and

(2) such Contribution Indebtedness (a) is Incurred within 210 days after the making of such cash contributions and (b) is so designated as Contribution Indebtedness pursuant to an Officer’s Certificate on the Incurrence date thereof.

“Credit Agreement” means (i) the credit agreement entered into on July 27, 2010, among the Issuers and Pinafore Acquisitions Limited, the financial institutions named therein and Citibank, N.A., as administrative agent, Citicorp USA, Inc. as collateral agent, Banc of America Securities LLC, as syndication agent, as amended and restated on August 6, 2010, as further amended and restated September 21, 2010, as further amended on September 28, 2010, as further amended, restated, supplemented, joined, waived, replaced (whether or not upon termination, and whether with the original lenders or otherwise), restructured, repaid, refunded, refinanced or otherwise modified from time to time, including any agreement or indenture extending the maturity thereof, refinancing, replacing or otherwise restructuring all or any portion of the Indebtedness under such agreement or agreements or indenture or indentures or any successor or replacement agreement or agreements or indenture or indentures or increasing the amount loaned or issued thereunder or altering the maturity thereof, and (ii) whether or not the credit agreement referred to in clause (i) remains outstanding, if designated by the Issuers to be included in the definition of “Credit Agreement,” one or more (A) debt facilities, indentures or commercial paper facilities providing for revolving credit loans, term loans, notes, debentures, receivables financing (including through the sale of receivables to lenders or to special purpose entities formed to borrow from lenders against such receivables) or letters of credit (B) debt securities, indentures or other forms of debt financing (including convertible or exchangeable debt instruments or bank guarantees or bankers’ acceptances), or (C) instruments or agreements evidencing any other Indebtedness, in each case, with the same or different borrowers or issuers and, in each case, as

 

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amended, supplemented, modified, extended, restructured, renewed, refinanced, restated, increased, replaced or refunded in whole or in part from time to time.

“Credit Agreement Collateral Agent” means Citicorp USA, Inc., in its capacity as collateral agent for the lenders and other secured parties under the Credit Agreement, together with its successors and permitted assigns under the Credit Agreement.

“Default” means any event which is, or after notice or passage of time or both would be, an Event of Default.

“Designated Non-cash Consideration” means the Fair Market Value of non-cash consideration received by the Issuers or one of their Restricted Subsidiaries in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such valuation, less the amount of Cash Equivalents received in connection with a subsequent sale of or collection on such Designated Non-cash Consideration.

“Designated Preferred Stock” means Preferred Stock of Holdings or any direct or indirect parent of Holdings, as applicable (other than Disqualified Stock), that is issued for cash (other than to Holdings or any of the Subsidiaries or an employee stock ownership plan or trust established by Holdings or any of the Subsidiaries) and is so designated as Designated Preferred Stock, pursuant to an Officer’s Certificate, on the issuance date thereof, the cash proceeds of which are excluded from the calculation set forth in Section 4.04(a)(3).

“Disqualified Stock” means any Capital Stock of such Person that, by its terms (or by the terms of any security into which it is convertible or for which it is redeemable or exchangeable, in each case at the option of the holder thereof), or upon the happening of any event:

(1) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise (other than as a result of a change of control or asset sale; provided that the relevant asset sale or change of control provisions, taken as a whole, are no more favorable in any material respect to Holders of such Capital Stock than the asset sale and change of control provisions applicable to the Securities and any purchase requirement triggered thereby may not become operative until compliance with the asset sale and change of control provisions applicable to the Securities (including the purchase of any Securities tendered pursuant thereto)),

(2) is convertible or exchangeable for Indebtedness or Disqualified Stock, or

(3) is redeemable at the option of the holder thereof, in whole or in part,

in each case prior to 91 days after the maturity date of the Securities; provided, however, that only the portion of Capital Stock that so matures or is mandatorily redeemable, is so convertible or exchangeable or is so redeemable at the option of the holder thereof prior to such date shall be deemed to be Disqualified Stock; provided, further, however, that if such Capital Stock is issued to any employee or to any plan for the benefit of employees of Holdings or the Subsidiaries or by any such plan to such employees, such Capital Stock shall not constitute Disqualified Stock

 

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solely because it may be required to be repurchased by the Issuers in order to satisfy applicable statutory or regulatory obligations or as a result of such employee’s termination, death or disability; provided, further, that any class of Capital Stock of such Person that by its terms authorizes such Person to satisfy its obligations thereunder by delivery of Capital Stock that is not Disqualified Stock shall not be deemed to be Disqualified Stock.

“EBITDA” means, with respect to Holdings and its Restricted Subsidiaries for any period, the Consolidated Net Income of Holdings and its Restricted Subsidiaries for such period plus, without duplication, to the extent the same was deducted in calculating Consolidated Net Income:

(1) Consolidated Taxes; plus

(2) Consolidated Interest Expense; plus

(3) Consolidated Non-cash Charges; plus

(4) the amount of management, monitoring, consulting and advisory fees and related expenses paid to the Sponsor (or any accruals relating to such fees and related expenses) during such period to the extent otherwise permitted under Section 4.07; plus

(5) any expenses or charges (other than Consolidated Non-cash Charges) related to any issuance of Equity Interests, Investment, acquisition, disposition, recapitalization or the Incurrence or repayment of Indebtedness permitted to be Incurred by this Indenture (including a refinancing thereof) (whether or not successful), including (i) such fees, expenses or charges related to the offering and/or issuance of the Securities, (ii) any amendment or other modification of the Securities or other Indebtedness, (iii) any additional interest in respect of the Securities and (iv) commissions, discounts, yield and other fees and charges (including any interest expense) related to any Qualified Receivables Financing; plus

(6) the amount of loss on sale of receivables and related assets to a Receivables Subsidiary in connection with a Qualified Receivables Financing; plus

(7) any costs or expense Incurred pursuant to any management equity plan or stock option plan or other management or employee benefit plan or agreement or any stock subscription or shareholder agreement, to the extent that such costs or expenses are funded with cash proceeds contributed to the capital of an Issuer or a Note Guarantor or the net cash proceeds of an issuance of Equity Interests of Holdings (other than Disqualified Stock) solely to the extent that such net cash proceeds are excluded from the calculation of the amount available for Restricted Payments under Section 4.04(a)(3)(A); plus

(8) any ordinary course dividend, distributions or other payment paid in cash and received from any Person in excess of amounts included in clause (7) pursuant to the definition of “Consolidated Net Income”; plus/minus

 

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(9) gains or losses due solely to fluctuations in currency values and the related tax effects; plus/minus

(10) gains or losses due to the net after-tax effect of clause (1), (3) and (4) in the definition “Consolidated Net Income” in calculating Consolidated Net Income;

less, without duplication, non-cash items increasing Consolidated Net Income for such period (excluding any items that represent the reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period).

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).

“Equity Offering” means any public or private sale after the Issue Date of common stock or Preferred Stock of Holdings or any direct or indirect parent of the Issuers, as applicable (other than Disqualified Stock), other than:

(1) public offerings with respect to such Person’s common stock registered on Form S-8;

(2) issuance to Holdings or any Restricted Subsidiary of Holdings; and

(3) any such public or private sale that constitutes an Excluded Contribution.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Excluded Assets” means “Excluded Assets” as defined in the Security Agreement.

In addition, in the event that Rule 3-16 of Regulation S-X under the Securities Act and the Exchange Act (or any successor regulation) is amended, modified or interpreted by the SEC to require (or is replaced with another rule or regulation, or any other law, rule or regulation is adopted, which would require) the filing with the SEC (or any other governmental agency) of separate financial statements of any Subsidiary of Holdings due to the fact that such Subsidiary’s securities secure the Securities, then the securities of such Subsidiary will not be subject to the Liens securing the Securities and will automatically be deemed not to be part of the Collateral but only to the extent necessary not to be subject to such requirement and only for so long as required to not be subject to the requirement. In the event that Rule 3-16 of Regulation S-X under the Securities Act and the Exchange Act (or any successor regulation) is amended, modified or interpreted by the SEC to permit (or is replaced with another rule or regulation, or any other law, rule or regulation is adopted, which would require) such Subsidiary’s securities to secure the Securities in excess of the amount then pledged without the filing with the SEC (or any other governmental agency) of separate financial statements of such Subsidiary, then the securities of such Subsidiary will automatically be deemed to be a part of the Collateral but only to the extent permitted to not be subject to any such financial statement requirement. Except for equity interests and certain other assets of certain of our Subsidiaries, to the extent any Senior Obligations (other

 

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than the Securities) are secured by any assets of any Note Guarantor or any Issuer, the Second Lien Note Obligations shall be secured by such assets.

In addition, with respect to any Foreign Subsidiary, Excluded Assets will consist of those types of assets customarily excluded as security for bank loans in non-U.S. jurisdictions as determined by the Credit Agreement Collateral Agent to the extent not inconsistent with such determination under the Credit Agreement.

“Excluded Contributions” means the net cash proceeds and Cash Equivalents received by or contributed to the Issuers or the Note Guarantors after the Issue Date from:

(1) contributions to its common or preferred equity capital, and

(2) the sale (other than to Holdings or a Restricted Subsidiary or management equity plan or stock option plan or any other management or employee benefit plan or agreement) of Capital Stock (other than Disqualified Stock and Designated Preferred Stock) of Holdings or any direct or indirect parent,

in each case designated as Excluded Contributions pursuant to an Officer’s Certificate executed by an Officer of the Issuers, the proceeds of which are excluded from the calculation set forth in Section 4.04(a)(3).

“Existing Notes” means the Medium Term Notes to the extent outstanding on the Issue Date.

“Fair Market Value” means, with respect to any asset or property, the price which could be negotiated in an arm’s-length, free market transaction, for cash, between a willing seller and a willing and able buyer, neither of whom is under undue pressure or compulsion to complete the transaction (as determined in good faith by the Issuers or Holdings).

“Fixed Charge Coverage Ratio” means, with respect to Holdings and its Restricted Subsidiaries for any period, the ratio of EBITDA of Holdings and its Restricted Subsidiaries for such period to the Fixed Charges of Holdings and its Restricted Subsidiaries for such period. In the event that Holdings or any of its Restricted Subsidiaries Incurs or redeems any Indebtedness (other than in the case of revolving credit borrowings or revolving advances under any Qualified Receivables Financing, in which case interest expense shall be computed based upon the average daily balance of such Indebtedness during the applicable period) or issues or redeems Preferred Stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to the event for which the calculation of the Fixed Charge Coverage Ratio is made (referred to in this definition as the “Calculation Date”), then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such Incurrence or redemption of Indebtedness, or such issuance or redemption of Preferred Stock, as if the same had occurred at the beginning of the applicable four-quarter period.

For purposes of making the computation referred to above, Investments, acquisitions, dispositions, mergers (including the Transactions), consolidations and discontinued operations (as determined in accordance with IFRS-EU), in each case with respect to an operating unit

 

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of a business, and operational changes, that Holdings or any of its Restricted Subsidiaries has both determined to make and made after the Issue Date and during the four-quarter reference period or subsequent to such reference period and on or prior to or simultaneously with the Calculation Date (each referred to in this definition as a “pro forma event”) shall be calculated on a pro forma basis assuming that all such Investments, acquisitions, dispositions, mergers (including the Transactions), consolidations, discontinued operations and operational changes (and the change of any associated fixed charge obligations and the change in EBITDA resulting therefrom) had occurred on the first day of the four-quarter reference period. If since the beginning of such period any Person that subsequently became Holdings or a Restricted Subsidiary or was merged with or into Holdings or any Restricted Subsidiary since the beginning of such period shall have made or effected any Investment, acquisition, disposition, merger, consolidation or discontinued operation, in each case with respect to an operating unit of a business, or operational change that would have required adjustment pursuant to this definition, then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Investment, acquisition, disposition, merger, consolidation, discontinued operation, or operational change had occurred at the beginning of the applicable four-quarter period.

For purposes of this definition, whenever pro forma effect is to be given to any pro forma event, the pro forma calculations shall be made in good faith by a responsible financial or accounting officer of the Issuers to the extent consistent with Regulation S-X or are otherwise reasonably identifiable and factually supportable, including the amount of cost savings and operating expense reductions for which specified actions are taken or committed to be taken within 12 months after the closing date of such pro forma event and have been realized or are expected to be realized within 12 months after the closing date of such pro forma event (calculated on a pro forma basis as though such cost savings and operating expense reductions had been realized on the first day of such period as if such cost savings and operating expense reductions were realized during the entirety of such period) relating to such pro forma event, net of the amount of actual benefits realized during such period from such actions; provided that (A) a duly completed certificate signed by the chief financial officer of the Issuers shall be delivered to the Trustee certifying that and setting forth in detail (x) such cost savings and operating expense reductions are reasonably expected and factually supportable in the good faith judgment of the Issuers, (y) such actions are to be taken within 12 months after the consummation of the acquisition, disposition, restructuring or the implementation of an initiative, which is expected to result in such cost savings and expense reductions, (B) no cost savings or operating expense reductions shall be added pursuant to this defined term to the extent duplicative of any expenses or charges otherwise added to EBITDA, whether through a pro forma adjustment or otherwise, for such period, (C) the aggregate amount of cost savings and operating expense reductions added pursuant to this definition in any period of four consecutive fiscal quarters shall not exceed (1) with respect to any individual acquisition or disposition, 10% of the EBITDA attributable to such acquired or disposed entity or assets for such period of four consecutive fiscal quarters and (2) for all other initiatives that do not result from acquisitions or dispositions, 10% of EBITDA (prior to giving effect to this definition) in the aggregate for any period of four consecutive fiscal quarters and (D) projected amounts (and not yet realized) may no longer be added in calculating EBITDA pursuant to this definition to the extent occurring more than four full fiscal quarters after the specified action taken in order to realize such projected cost savings and operating expense reductions.

If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedging Obligations applicable to such Indebtedness if such Hedging Obligation has a remaining term in

 

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excess of 12 months). Interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a responsible financial or accounting officer of the Issuers to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with IFRS-EU. For purposes of making the computation referred to above, interest on any Indebtedness under a revolving credit facility computed on a pro forma basis shall be computed based upon the average daily balance of such Indebtedness during the applicable period. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rate, shall be deemed to have been based upon the rate actually chosen, or, if none, then based upon such optional rate chosen as the Issuers may designate.

“Fixed Charges” means, with respect to any Person for any period, the sum of:

(1) Consolidated Interest Expense of such Person for such period, and

(2) all cash dividend payments (excluding items eliminated in consolidation) on any series of Preferred Stock or Disqualified Stock of such Person and its Restricted Subsidiaries.

“Foreign Subsidiary” means a Restricted Subsidiary not organized or existing under the laws of the United States of America or any state or territory thereof or the District of Columbia and any direct or indirect Subsidiary of such Restricted Subsidiary.

“guarantee” means, as to any Person, a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including, without limitation, letters of credit and reimbursement agreements in respect thereof), of all or any part of any Indebtedness of another Person.

“Hedging Obligations” means, with respect to any Person, the obligations of such Person under:

(1) currency exchange, interest rate or commodity Swap Agreements, currency exchange, interest rate or commodity cap agreements and currency exchange, interest rate or commodity collar agreements; and

(2) other agreements or arrangements designed to protect such Person against fluctuations in currency exchange, interest rates or commodity prices.

“Holder” means the Person in whose name a Security is registered on the Registrar’s books.

“Holdings” means Pinafore Holdings B.V. and its successors.

“IFRS-EU” means International Financial Reporting Standards as endorsed by the European Union, as in effect from time to time; provided, however, that if Holdings notifies the Trustee in writing that Holdings (i) has elected to report under generally accepted accounting principles in, initially, the United States of America, as in effect from time to time (“GAAP”),

 

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“IFRS-EU” shall mean generally accepted accounting principles pursuant to GAAP (provided that after such election, Holdings cannot elect to report under International Financial Reporting Standards) or (ii) requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Issue Date in IFRS-EU or in the application thereof on the operation of such provision (or if the Trustee notifies Holdings that the Holders of a majority of the principal amount of the notes outstanding request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in IFRS-EU or in the application thereof, then such provision shall be interpreted on the basis of IFRS-EU as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith and the Trustee, the Holders and Holdings shall negotiate in good faith to amend such provision to preserve the original intent thereof in light of such change in IFRS-EU (subject to the approval of the Holders of a majority of the principal amount of the notes); provided, further, that if reasonably requested by the Trustee, Holdings shall provide to the Trustee and the Holders financial statements and other documents setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such conversion to GAAP or change in IFRS-EU.

“Incur” means, with respect to any Indebtedness, issue, assume, guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness or Capital Stock of a Person existing at the time such Person becomes a Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a Subsidiary.

“Indebtedness” means, with respect to any Person:

(1) the principal and premium (if any) of any Indebtedness of such Person, whether or not contingent, (a) in respect of borrowed money, (b) evidenced by bonds, notes, debentures or similar instruments or letters of credit or bankers’ acceptances (or, reimbursement agreements in respect thereof), (c) representing the deferred and unpaid purchase price of any property, except (i) any such balance that constitutes a trade payable, accrued expense or similar obligation to a trade creditor and (ii) any earn-out obligations until such obligation becomes a liability on the balance sheet of such Person in accordance with IFRS-EU, (d) in respect of Capitalized Lease Obligations, or (e) representing any Hedging Obligations, other than Hedging Obligations that are incurred in the normal course of business and not for speculative purposes, and that do not increase the Indebtedness of the obligor outstanding at any time other than as a result of fluctuations in interest rates, commodity prices or foreign currency exchange rates or by reason of fees, indemnities and compensation payable thereunder, if and to the extent that any of the foregoing Indebtedness (other than letters of credit and Hedging Obligations) would appear as a liability on a balance sheet (excluding the footnotes thereto) of such Person prepared in accordance with IFRS-EU;

(2) to the extent not otherwise included, any obligation of such Person to be liable for, or to pay, as obligor, guarantor or otherwise, on the Indebtedness of another Person (other than by endorsement of negotiable instruments for collection in the ordinary course of business); and

(3) to the extent not otherwise included, Indebtedness of another Person secured by a Lien on any asset owned by such Person (whether or not such Indebtedness is

 

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assumed by such Person); provided, however, that the amount of such Indebtedness will be the lesser of: (a) the Fair Market Value of such asset at such date of determination, and (b) the amount of such Indebtedness of such other Person;

provided that (a) Contingent Obligations Incurred in the ordinary course of business, (b) obligations under or in respect of Receivables Financings, (c) COLI Loans, (d) the Loan Notes and (e) Obligations associated with other post-employment benefits and pension plans shall be deemed not to constitute Indebtedness.

“Indenture” means this Indenture as amended or supplemented from time to time.

“Independent Financial Advisor” means an accounting, appraisal or investment banking firm or consultant, in each case of nationally recognized standing that is, in the good faith determination of Holdings, its direct or indirect parent or the Issuers, qualified to perform the task for which it has been engaged.

“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P, or an equivalent rating by any other Rating Agency.

“Investment Grade Securities” means:

(1) securities issued or directly and fully guaranteed or insured by the U.S. government or any agency or instrumentality thereof (other than Cash Equivalents) and in each case with maturities not exceeding two years from the date of acquisition,

(2) securities that have a rating equal to or higher than Baa3 (or the equivalent) by Moody’s or BBB- (or the equivalent) by S&P, or an equivalent rating by any other Rating Agency,

(3) investments in any fund that invests at least 95% of its assets in investments of the type described in clauses (1) and (2) which fund may also hold immaterial amounts of cash pending investment and/or distribution, and

(4) corresponding instruments in countries other than the United States customarily utilized for high quality investments and in each case with maturities not exceeding two years from the date of acquisition.

“Investments” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans (including guarantees), advances or capital contributions (excluding accounts receivable, trade credit and advances to customers and commission, travel and similar advances to officers, directors, employees and consultants made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities issued by any other Person and investments that are required by IFRS-EU to be classified on the balance sheet of Holdings in the same manner as the other investments included in this definition to the extent such transactions involve the transfer

 

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of cash or other property. For purposes of the definition of “Unrestricted Subsidiary” and Section 4.04:

(1) “Investments” shall include the portion (proportionate to the applicable Holdings’ equity interest in such Subsidiary) of the Fair Market Value of the net assets of a Subsidiary of Holdings at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary, Holdings shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary equal to an amount (if positive) equal to:

(a) Holdings’ “Investment” in such Subsidiary at the time of such redesignation less

(b) the portion (proportionate to Holdings’ equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time of such redesignation; and

(2) any property transferred to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value at the time of such transfer, in each case as determined in good faith by the Board of Directors of the Issuers.

“Issue Date” means September 29, 2010.

“Loan Note Alternative” means the option made available to Holders of Target Shares, subject to the terms and conditions set out in the Scheme Document, to elect to receive Loan Notes in place of the cash consideration otherwise payable.

“Loan Note Escrow Account” means an escrow or security account held at an institution reasonably acceptable to the Credit Agreement Collateral Agent provided for under an escrow and security agreement in form and substance reasonably satisfactory to the Credit Agreement Collateral Agent which will provide, among other things, that (i) so long as any Loan Notes are outstanding, release of funds from the Loan Note Escrow Account and any interest accrued thereon shall be only for the purposes of the payment of principal and interest on the Loan Notes and, in the event of either a substitution of the issuer of the Loan Notes or the exchange of the existing Loan Notes for Loan Notes of any new issuer, in each case in accordance with the terms of the Loan Note Instrument, the deposit of all funds in such Loan Note Escrow Account into a new Loan Note Escrow Account and (ii) in each interest period for the Loan Notes, the interest accruing on the funds in the Loan Note Escrow Account shall be sufficient to pay in full the interest accruing on the Loan Notes during such interest period.

“Loan Note Instrument” means the agreed form instrument constituting the Loan Notes and any certificates evidencing issued Loan Notes, each substantially in the form reasonably acceptable to the Credit Agreement Collateral Agent (or any substituted or exchange instrument that may be executed in accordance with the terms of the original Loan Note Instrument; provided that the terms and conditions of such substituted or exchange instrument are not materially less favorable to the Holders of the Securities, taken as a whole, than the terms and conditions of the original Loan Note Instrument).

 

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“Loan Notes” means the loan notes to be issued pursuant to the Loan Note Instrument by Pinafore Acquisitions Limited (or any substituted or new issuer in accordance with the terms of the Loan Note Instrument) to electing Holders of the Target Shares under the Loan Note Alternative in an aggregate principal amount not to exceed £50,000,000.

“Management Agreement” means one or more Management Services Agreements, dated on or about the Issue Date between Holdings or any of its Affiliates and the Sponsor, or any successor agreement between the Issuers, or Holdings or any of its Affiliates and the Sponsor, as may be amended, supplemented or otherwise modified from time to time; provided that such amendments, supplements or modifications are not materially adverse to the note Holders as determined in good faith by the Issuers.

“Management Investor” means any Person who is a director, officer or otherwise a member of management of Holdings, any of the Restricted Subsidiaries or any of its direct or indirect parent companies on the Issue Date immediately after giving effect to the Transactions.

“Moody’s” means Moody’s Investors Service, Inc. or any successor to the rating agency business thereof.

“Mortgage” shall mean a deed of trust, trust deed, hypothec or mortgage (or equivalent) made by an Issuer or Note Guarantor in favor or for the benefit of the Collateral Agent on behalf of the Trustee and the Holders of the Securities creating and evidencing a lien on a Mortgaged Property and any other deed of trust, trust deed, hypothec or mortgage (or equivalent) executed and delivered pursuant to the Indenture or the Collateral Documents.

“Mortgaged Property” shall mean each parcel of real property which, pursuant to the terms of the Credit Agreement, is or is required to be subject to a deed of trust, trust deed, hypothec or mortgage securing the Credit Agreement.

“Net Cash Proceeds” means the aggregate cash proceeds received by Holdings or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received in respect of or upon the sale or other disposition of any Designated Non-cash Consideration received in any Asset Sale and any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise, but only as and when received, but excluding the assumption by the acquiring Person of Indebtedness relating to the disposed assets or other consideration received in any other non-cash form), net of the direct costs relating to such Asset Sale and the sale or disposition of such Designated Non-cash Consideration (including, without limitation, legal, accounting and investment banking fees, and brokerage and sales commissions), and any relocation expenses Incurred as a result thereof, taxes paid or payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements related thereto), amounts required to be applied to the repayment of principal, premium (if any) and interest on Indebtedness required (other than pursuant to Section 4.06(b)) to be paid as a result of such transaction, and any deduction of appropriate amounts to be provided by the Issuers as a reserve in accordance with IFRS-EU against any liabilities associated with the asset disposed of in such transaction and retained by the Issuers after such sale or other disposition thereof, including, without limitation, pension and other post-

 

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employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations associated with such transaction.

“Net Income” means, with respect to any Person, the net income (loss) attributable to such Person, determined in accordance with IFRS-EU and before any reduction in respect of Preferred Stock dividends.

“Note Guarantee” means a guarantee of the Securities pursuant to this Indenture.

“Note Guarantor” means any Person that Incurs a Note Guarantee; provided that upon the release or discharge of such Person from its Note Guarantee in accordance with this Indenture, such Person ceases to be a Note Guarantor.

“Obligations” means any principal, interest, penalties, fees, indemnifications, reimbursements (including, without limitation, reimbursement obligations with respect to letters of credit and bankers’ acceptances), damages and other liabilities payable under the documentation governing any Indebtedness; provided that Obligations with respect to the Securities shall not include fees or indemnifications in favor of the Trustee, the Collateral Agent and other third parties other than the Holders of the Securities.

“Offering Memorandum” means the offering memorandum relating to the offering of the Original Securities dated September 21, 2010.

“Officer” means the Chairman of the Board, Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, President, any Executive Vice President, Senior Vice President, Vice President or Assistant Vice President, the Controller, the Treasurer, the Assistant Treasurer or the Secretary or Assistant Secretary of the Issuers.

“Officer’s Certificate” means a certificate signed on behalf of both Issuers by any one Officer of either of the Issuers, who must be the principal executive officer, the principal financial officer, the treasurer, general counsel, secretary, assistant secretary, vice president or the principal accounting officer of one of the Issuers that meets the requirements set forth in this Indenture.

“Opinion of Counsel” means an opinion from legal counsel who is reasonably acceptable to the Trustee that meets the requirements set forth in this Indenture. The counsel may be an employee of or counsel to the Issuers or any affiliate of the Issuers.

“Paying Agent” means an office or agency maintained by the Issuers pursuant to the terms of the Indenture, where Securities may be presented for payment.

“Permitted Asset Swap” means the concurrent purchase and sale or exchange of Related Business Assets or a combination of Related Business Assets and cash or Cash Equivalents between Holdings or any of its Restricted Subsidiaries and another Person; provided, that any cash or Cash Equivalents received must be applied in accordance with Section 4.06.

 

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“Permitted Holders” means (i) the Sponsor, (ii) the Management Investors, (iii) any Person that has no material assets other than the Capital Stock of Holdings and, directly or indirectly, holds or acquires 100% of the total voting power of the Voting Stock of Holdings, and of which no other Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), other than any Permitted Holder specified in clause (i) above, holds more than 50% of the total voting power of the Voting Stock thereof, and (iv) any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision) the members of which include any Permitted Holder specified in clauses (i) or (ii) above and that, directly or indirectly, hold or acquire beneficial ownership of the Voting Stock of Holdings (referred to in this definition as a “Permitted Holder Group”), so long as no Person or other “group” (other than a Permitted Holder specified in clause (i) and (iii) above) beneficially owns more than 50% on a fully diluted basis of the Voting Stock held by the Permitted Holder Group. Any Person or group, together with its Affiliates, whose acquisition of beneficial ownership constitutes a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of this Indenture will thereafter constitute an additional Permitted Holder.

“Permitted Investments” means:

(1) any Investment in Holdings (including the Securities) or any Restricted Subsidiary of Holdings;

(2) any Investment in Cash Equivalents or Investment Grade Securities;

(3) any Investment by Holdings or any Restricted Subsidiary of Holdings in a Person that is primarily engaged in a Similar Business if as a result of such Investment (a) such Person becomes a Restricted Subsidiary of Holdings, or (b) such Person, in one transaction or a series of related transactions, is merged, consolidated or amalgamated with or into, or transfers or conveys all or substantially all of its assets to, or is liquidated into, Holdings or a Restricted Subsidiary of Holdings;

(4) any Investment in securities or other assets not constituting Cash Equivalents and received in connection with an Asset Sale made pursuant to Section 4.06 or any other disposition of assets not constituting an Asset Sale;

(5) any Investment (x) existing on the Issue Date, (y) made pursuant to binding commitments in effect on the Issue Date and (z) that replaces, refinances, refunds, renews or extends any Investment described under either of the immediately preceding clauses (x) or (y), provided that any such Investment is in an amount that does not exceed the amount replaced, refinanced, refunded, renewed or extended;

(6) advances to employees not in excess of $5.0 million outstanding at any one time in the aggregate;

(7) any Investment acquired by Holdings or any of its Restricted Subsidiaries (a) in exchange for any other Investment or accounts receivable held by Holdings or any such Restricted Subsidiary in connection with or as a result of a bankruptcy, workout,

 

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reorganization or recapitalization of the issuer of such other Investment or accounts receivable, or (b) as a result of a foreclosure by Holdings or any of its Restricted Subsidiaries with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;

(8) Hedging Obligations permitted under Section 4.03(b)(x);

(9) additional Investments by Holdings or any of its Restricted Subsidiaries having an aggregate Fair Market Value, taken together with all other Investments made pursuant to this clause (9) that are at the time outstanding, not to exceed $100.0 million (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value), at any one time outstanding;

(10) loans and advances to officers, directors and employees for business-related travel expenses, moving and relocation expenses and other similar expenses, in each case Incurred in the ordinary course of business;

(11) Investments the payment for which consists of Equity Interests of Holdings (other than Disqualified Stock) or any direct or indirect parent of Holdings, as applicable; provided, however, that such Equity Interests will not increase the amount available for Restricted Payments under Section 4.04(a)(3);

(12) any transaction to the extent it constitutes an Investment that is permitted by and made in accordance with Section 4.07(b) (except transactions described in clauses (ii), (iv), (v), (viii)(B), (xxii), (xxiii) and (xxiv) of such Section);

(13) Investments consisting of the licensing or contribution of intellectual property pursuant to joint marketing arrangements with other Persons;

(14) guarantees issued in accordance with Sections 4.03 and 4.10;

(15) any Investment by Restricted Subsidiaries of Holdings in other Restricted Subsidiaries of Holdings and Investments by Subsidiaries that are not Restricted Subsidiaries in other Subsidiaries that are not Restricted Subsidiaries of Holdings;

(16) Investments consisting of purchases and acquisitions of inventory, supplies, materials and equipment or purchases of contract rights or licenses or leases of intellectual property, in each case in the ordinary course of business;

(17) any Investment in a Receivables Subsidiary or any Investment by a Receivables Subsidiary in any other Person in connection with a Qualified Receivables Financing, including Investments of funds held in accounts permitted or required by the arrangements governing such Qualified Receivables Financing or any related Indebtedness; provided, however, that any Investment in a Receivables Subsidiary is in the form of a Purchase Money Note, contribution of additional receivables or an equity interest;

 

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(18) Investments resulting from the receipt of non-cash consideration in an Asset Sale received in compliance with Section 4.06;

(19) Investments in joint ventures of Holdings or any of its Restricted Subsidiaries existing on the Issue Date and additional Investments in joint ventures in an aggregate amount not to exceed $100.0 million at any one time outstanding;

(20) Investments constituting COLI Loans; and

(21) Investments of a Restricted Subsidiary of Holdings acquired after the Issue Date or of an entity merged into or consolidated with a Restricted Subsidiary of Holdings in a transaction that is not prohibited by Section 5.01 after the Issue Date to the extent that such Investments were not made in contemplation of such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation.

“Permitted Liens” means with respect to any Person:

(1) pledges or deposits by such Person under workmen’s compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person or deposits of cash or U.S. government bonds to secure surety or appeal bonds to which such Person is a party, or deposits as security for contested taxes or import duties or for the payment of rent, in each case Incurred in the ordinary course of business;

(2) Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens, in each case for sums not yet due or being contested in good faith by appropriate proceedings or other Liens arising out of judgments or awards against such Person with respect to which such Person shall then be proceeding with an appeal or other proceedings for review (or which, if due and payable, are being contested in good faith by appropriate proceedings and for which adequate reserves are being maintained, to the extent required by IFRS-EU and such proceedings have the effect of preventing the forfeiture or sale of the property or assets subject to any such Lien);

(3) Liens for taxes, assessments or other governmental charges (i) which are not yet due or payable or (ii) which are being contested in good faith by appropriate proceedings that have the effect of preventing the forfeiture or sale of the property or assets subject to any such Lien and for which adequate reserves are being maintained to the extent required by IFRS-EU;

(4) Liens in favor of issuers of performance and surety bonds or bid bonds or with respect to other regulatory requirements or letters of credit issued pursuant to the request of and for the account of such Person in the ordinary course of its business;

(5) minor survey exceptions, minor encumbrances, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and

 

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telephone lines and other similar purposes, or zoning or other restrictions as to the use of real properties or Liens incidental to the conduct of the business of such Person or to the ownership of its properties which were not Incurred in connection with Indebtedness and which do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;

(6) Liens Incurred to secure Obligations in respect of Indebtedness permitted to be Incurred pursuant to clauses (i), (iv) or (xix) of Section 4.03(b); provided that, (x) in the case of clause (iv), such Lien extends only to the assets and/or Capital Stock, the acquisition, lease, construction, repair, replacement or improvement of which is financed thereby and any income or profits thereof; and (y) in the case of clause (xix), such Lien does not extend to the property or assets (or income or profits therefrom) of any Restricted Subsidiary other than a Foreign Subsidiary that is not a Note Guarantor;

(7) Liens existing on the Issue Date;

(8) Liens on assets, property or shares of stock of a Person at the time such Person becomes a Subsidiary; provided, however, that such Liens are not created or Incurred in connection with, or in contemplation of, such other Person becoming such a Subsidiary; provided, further, however, that such Liens may not extend to any other property owned by the Issuers or any Restricted Subsidiary of the Issuers;

(9) Liens on assets or on property at the time Holdings or a Restricted Subsidiary of Holdings acquired the assets or property, including any acquisition by means of a merger or consolidation with or into Holdings or any Restricted Subsidiary of Holdings; provided, however, that such Liens are not created or Incurred in connection with, or in contemplation of, such acquisition; provided, further, however, that the Liens may not extend to any other assets or property owned by Holdings or any Restricted Subsidiary of Holdings;

(10) Liens securing Indebtedness or other obligations of a Restricted Subsidiary owing to Holdings or another Restricted Subsidiary of Holdings permitted to be Incurred in accordance with Section 4.03;

(11) Liens securing Hedging Obligations so long as the related Indebtedness is, and is permitted to be under this Indenture, secured by a Lien on the same property securing such Hedging Obligations;

(12) Liens on specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;

(13) leases and subleases of real property which do not materially interfere with the ordinary conduct of the business of Holdings or any of its Restricted Subsidiaries;

 

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(14) Liens arising from Uniform Commercial Code financing statement filings regarding operating leases entered into by Holdings and its Restricted Subsidiaries in the ordinary course of business;

(15) Liens in favor of the Issuers or any Note Guarantor;

(16) Liens on accounts receivable and related assets of the type specified in the definition of “Receivables Financing” Incurred in connection with a Qualified Receivables Financing;

(17) deposits made in the ordinary course of business to secure liability to insurance carriers;

(18) Liens on the Equity Interests of Unrestricted Subsidiaries;

(19) grants of software and other technology licenses in the ordinary course of business;

(20) judgment and attachment Liens not giving rise to an Event of Default and notices of lis pendens and associated rights related to litigation being contested in good faith by appropriate proceedings and for which adequate reserves have been made;

(21) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into in the ordinary course of business;

(22) Liens Incurred to secure cash management services (and other “bank products”), owed to a lender or an affiliate thereof at the time when entered into, under the Credit Agreement in the ordinary course of business;

(23) Liens on equipment of Holdings or any Restricted Subsidiary of Holdings granted in the ordinary course of business to Holdings’ or such Restricted Subsidiary’s client at which such equipment is located;

(24) Liens to secure any refinancing, refunding, extension, renewal or replacement (or successive refinancings, refundings, extensions, renewals or replacements) as a whole, or in part, of any Indebtedness secured by any Lien referred to in clauses (7), (8), (9), (10), (11) and (15); provided, however, that (x) such new Lien shall be limited to all or part of the same property that secured the original Lien (plus improvements on such property), and (y) the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (A) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clauses (7), (8), (9), (10), (11) and (15) at the time the original Lien became a Permitted Lien under this Indenture, and (B) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing, refunding, extension, renewal or replacement;

(25) other Liens securing obligations Incurred in the ordinary course of business which obligations do not exceed $150.0 million at any one time outstanding;

 

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(26) Liens on equipment of Holdings or any Restricted Subsidiary of Holdings granted in the ordinary course of business to Holdings’ or such Restricted Subsidiary’s client at which such equipment is located;

(27) judgment and attachment Liens not giving rise to an Event of Default and notices of lis pendens and associated rights related to litigation being contested in good faith by appropriate proceedings and for which adequate reserves have been made;

(28) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into in the ordinary course of business;

(29) Liens securing the Second Lien Note Obligations;

(30) Liens on the Collateral in favor of any collateral agent relating to such collateral agent’s administrative expenses with respect to the Collateral;

(31) Liens associated with COLI Loans;

(32) Liens securing Indebtedness permitted to be incurred pursuant to Section 4.03 in an amount not to exceed the maximum amount of Indebtedness such that the Consolidated Senior Secured Debt Ratio (at the time of incurrence of such Indebtedness after giving pro forma effect thereto in a manner consistent with the calculation of the Fixed Charge Coverage Ratio) would not be greater than 3.25 to 1.00; provided that such Liens are subject to the Second Lien Intercreditor Agreement on a pari passu or junior lien basis with the Securities;

(33) Liens on receivable and related assets including proceeds thereof being sold in factoring arrangements entered into in the ordinary course of business; and

(34) Liens on the Loan Note Escrow Account securing obligations of Holdings or any of its Restricted Subsidiaries under the Loan Notes.

“Person” means any natural person, corporation, limited partnership, general partnership, limited liability company, limited liability partnership, joint venture, association, joint-stock company, trust, bank trust company, land trust, business trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity whether legal or not.

“Post-Closing Collateral Date” means the date that is (x) with respect to any personal property located in the United States and Canada, 60 days following the Issue Date and (y) with respect to any personal property located outside the United States and Canada or any real property, 90 days following the Issue Date, or in each case such longer period of time to the extent such longer period has been agreed to by the Credit Agreement Collateral Agent with respect to the Credit Agreement in writing.

“Preferred Stock” means any Equity Interest with preferential right of payment of dividends or redemptions upon liquidation, dissolution or winding up.

 

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“Purchase Money Note” means a promissory note of a Receivables Subsidiary evidencing a line of credit, which may be irrevocable, from Holdings or any Subsidiary of Holdings to a Receivables Subsidiary in connection with a Qualified Receivables Financing, which note is intended to finance that portion of the purchase price that is not paid by cash or a contribution of equity.

“Qualified Receivables Financing” means any Receivables Financing of a Receivables Subsidiary that meets the following conditions:

(1) the Board of Directors of Holdings shall have determined in good faith that such Qualified Receivables Financing (including financing terms, covenants, termination events and other provisions) is in the aggregate economically fair and reasonable to Holdings and the Receivables Subsidiary,

(2) all sales of accounts receivable and related assets to the Receivables Subsidiary are made at Fair Market Value (as determined in good faith by the Issuers), and

(3) the financing terms, covenants, termination events and other provisions thereof shall be market terms (as determined in good faith by the Issuers) and may include Standard Securitization Undertakings.

The grant of a security interest in any accounts receivable of Holdings or any Restricted Subsidiary of Holdings (other than a Receivables Subsidiary) to secure any Indebtedness shall not be deemed a Qualified Receivables Financing.

“Rating Agencies” means (1) each of Moody’s and S&P and (2) if Moody’s or S&P ceases to rate the Securities for reasons outside of the Issuers’ control, a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act selected by the Issuers or any parent of the Issuers as a replacement agency for Moody’s or S&P, as the case may be.

“Receivables Fees” means distributions or payments made directly or by means of discounts with respect to any participation interest issued or sold in connection with, and other fees paid to a Person that is not a Restricted Subsidiary in connection with, any Receivables Financing.

“Receivables Financing” means any transaction or series of transactions that may be entered into by Holdings or any Subsidiary of Holdings pursuant to which Holdings or any of its Subsidiaries may sell, convey or otherwise transfer to (a) a Receivables Subsidiary (in the case of a transfer by Holdings or any of its Subsidiaries), and (b) any other Person (in the case of a transfer by a Receivables Subsidiary), or may grant a security interest in, any accounts receivable (whether now existing or arising in the future) of Holdings or any of its Subsidiaries, and any assets related thereto including, without limitation, all collateral securing such accounts receivable, all contracts and all guarantees or other obligations in respect of such accounts receivable, proceeds of such accounts receivable and other assets which are customarily transferred or in respect of which security interests are customarily granted in connection with asset

 

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securitization transactions involving accounts receivable and any Hedging Obligations entered into by Holdings or any such Subsidiary in connection with such accounts receivable.

“Receivables Repurchase Obligation” means any obligation of a seller of receivables in a Qualified Receivables Financing to repurchase receivables arising as a result of a breach of a representation, warranty or covenant or otherwise, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, off-set or counterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.

“Receivables Subsidiary” means a Wholly Owned Restricted Subsidiary of Holdings (or another Person formed for the purposes of engaging in a Qualified Receivables Financing with Holdings in which Holdings or any Subsidiary of Holdings makes an Investment and to which Holdings or any Subsidiary of Holdings transfers accounts receivable and related assets) which engages in no activities other than in connection with the financing of accounts receivable of Holdings and its Subsidiaries, all proceeds thereof and all rights (contractual or other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and which is designated by the Board of Directors of the Issuers (as provided below) as a Receivables Subsidiary and:

(a) no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (i) is guaranteed by Holdings or any other Subsidiary of Holdings (excluding guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (ii) is recourse to or obligates Holdings or any other Subsidiary of Holdings in any way other than pursuant to Standard Securitization Undertakings, or (iii) subjects any property or asset of Holdings or any other Subsidiary of Holdings, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings,

(b) with which neither Holdings nor any other Subsidiary of Holdings has any material contract, agreement, arrangement or understanding other than on terms which the Issuers reasonably believe to be no less favorable to Holdings or such Subsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Issuers, and

(c) to which neither Holdings nor any other Subsidiary of Holdings has any obligation to maintain or preserve such entity’s financial condition or cause such entity to achieve certain levels of operating results.

Any such designation by the Board of Directors of the Issuers shall be evidenced to the Trustee by filing with the Trustee a certified copy of the resolution of the Board of Directors of the Issuers giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the foregoing conditions.

“Related Business Assets” means assets (other than cash or Cash Equivalents) used or useful in a Similar Business; provided that any assets received by Holdings or a Restricted Subsidiary in exchange for assets transferred by Holdings or a Restricted Subsidiary will

 

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not be deemed to be Related Business Assets if they consist of securities of a Person, unless upon receipt of the securities of such Person, such Person would become a Restricted Subsidiary.

“Restricted Investment” means an Investment other than a Permitted Investment.

“Restricted Subsidiary” means, at any time any direct or indirect Subsidiary of Holdings (including any Foreign Subsidiary) that is not then an Unrestricted Subsidiary; provided, however, that upon an Unrestricted Subsidiary’s ceasing to be an Unrestricted Subsidiary, such Subsidiary shall be included in the definition of “Restricted Subsidiary”.

“Sale/Leaseback Transaction” means an arrangement relating to assets or property now owned or hereafter acquired by the Person whereby the Issuers or a Restricted Subsidiary transfers such assets or property to a Person and the Issuers or such Restricted Subsidiary leases it from such Person, other than leases between the Issuers and a Restricted Subsidiary of the Issuers or between Restricted Subsidiaries of the Issuers.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor to the rating agency business thereof.

“Scheme” means a scheme of arrangement made pursuant to Part 26 of the Companies Act in relation to the cancellation of the entire issued share capital of Tomkins plc and the subsequent issue of new shares in the Tomkins plc to the Issuers as contemplated by the press release made by or on behalf of the Issuers announcing the terms of the Scheme.

“Scheme Document” means the scheme document to be issued by Tomkins plc to its shareholders in respect of the Scheme on substantially the same terms, other than with respect to the Loan Notes, as set forth in the Scheme Press Release.

“Scheme Press Release” means the press release made by or on behalf of Holdings announcing the terms of the Scheme.

“SEC” means the U.S. Securities and Exchange Commission.

“Second Lien Collateral Documents” means the Collateral Documents and any other agreement, document or instrument pursuant to which a Lien is granted or purported to be granted securing Second Lien Note Obligations or under which rights or remedies with respect to such Liens are governed, in each case to the extent relating to the collateral securing the Second Lien Note Obligations.

“Second Lien Intercreditor Agreement” means the junior lien intercreditor agreement dated as of July 27, 2010, among the Issuers, Citibank, N.A. as senior representative for the credit agreement secured parties, Bank of America, N.A. as initial second priority representative and each additional authorized representative for time to time party thereto, as amended and restated on September 21, 2010, as further amended and restated on the Issue Date, as further amended, restated, amended and restated, extended, supplemented or otherwise modified in accordance with its terms.

 

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“Second Lien Note Obligations” means any obligations in respect of the Original Securities, this Indenture and the Second Lien Collateral Documents, including, for the avoidance of doubt, obligations in respect of exchange Securities and guarantees thereof.

“Second Lien Obligations” means, collectively, (a) the Second Lien Note Obligations and (b) any Series of Additional Second Lien Obligations.

“Secured Parties” has the meaning assigned to such term in the Security Agreement.

“Securities Act” means the Securities Act of 1933, as amended.

“Security Agreement” means the U.S. Second Lien Notes Security Agreement dated as of the Issue Date by and among the Collateral Agent, Holdings and certain of its Subsidiaries, as the same may be amended, amended and restated, modified, renewed or replaced from time to time.

“Senior Obligations” means, collectively, (a) all Credit Agreement Obligations and (b) any Series of Additional Senior Obligations.

“Series “ means (a) with respect to the Second Lien Obligations, each of (i) the Second Lien Note Obligations and (ii) the Additional Second Lien Obligations incurred pursuant to any applicable agreement, which, pursuant to any joinder agreement, are to be represented under the Second Lien Intercreditor Agreement by a Representative (as defined in the Second Lien Intercreditor Agreement) (in its capacity as such for such Additional Second Lien Obligations) and (b) with respect to the Senior Obligation, each of (i) the Credit Agreement Obligations and (ii) the Additional Senior Obligations incurred pursuant to any applicable agreement, which, pursuant to any joinder agreement, are to be represented under the Second Lien Intercreditor Agreement by a Representative (in its capacity as such for such Additional Senior Obligation).

“Significant Subsidiary” means any Restricted Subsidiary that would be a “Significant Subsidiary” within the meaning of Rule 1-02 under the Securities Act.

“Similar Business” means any business engaged in by Holdings or any Restricted Subsidiaries of Holdings on the Issue Date and any business or other activities that are reasonably similar, ancillary, complementary or related to, or a reasonable extension, development or expansion of, the businesses in which Holdings and the Restricted Subsidiaries are engaged on the Issue Date.

“Sponsor” means (1) Onex Partners, (2) Canada Pension Plan Investment Board and/or (3) one or more investment funds advised, managed or controlled by Onex Partners or Canada Pension Plan Investment Board and, in each case (whether individually or as a group) their Affiliates.

“Standard Securitization Undertakings” means representations, warranties, covenants, indemnities and guarantees of performance entered into by Holdings or any Subsidiary of Holdings which Holdings has determined in good faith to be customary in a Receivables

 

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Financing including, without limitation, those relating to the servicing of the assets of a Receivables Subsidiary, it being understood that any Receivables Repurchase Obligation shall be deemed to be a Standard Securitization Undertaking.

“Stated Maturity” means, with respect to any security, the date specified in such security as the fixed date on which the final payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency beyond the control of the issuer unless such contingency has occurred).

“Subordinated Indebtedness” means (a) with respect to an Issuer, any Indebtedness of such Issuer which is by its terms subordinated in right of payment to the Securities or which is secured on a subordinated basis to any Second Lien Obligations of such Issuer, and (b) with respect to any Note Guarantor, any Indebtedness of such Note Guarantor which is by its terms subordinated in right of payment to its Note Guarantee or which is secured on a subordinated basis to any Second Lien Obligations of such Note Guarantor.

“Subsidiary” means, with respect to any Person (1) any corporation, partnership, limited liability company, unlimited liability company, association, joint venture or other business entity (other than a partnership, joint venture or limited liability company) of which more than 50% of the total voting power of shares of stock or other ownership interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Person or Persons whether directors, managers, trustees or other Persons performing similar functions having the power to direct or cause the direction of the management and policies thereof at the time of determination owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, (2) any partnership, joint venture or limited liability company of which (x) more than 50% of the capital accounts, distribution rights, total equity and voting interests or general and limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof, whether in the form of membership, general, special or limited partnership interests or otherwise, and (y) such Person or any Restricted Subsidiary of such Person is a controlling general partner or otherwise controls such entity and (3) any Person that is consolidated in the consolidated financial statements of the specified Person in accordance with IFRS-EU.

“Swap Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities (including, for the avoidance of doubt, resin), equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided, that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Issuers or any of the Subsidiaries shall be a Swap Agreement.

“Target Shares” means all the issued and unconditionally allotted share capital in Tomkins plc and any further shares in the capital of Tomkins plc which may be issued or

 

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unconditionally allotted pursuant to the exercise of any outstanding subscription or conversion rights or otherwise together with all related rights.

“Tax Distributions” means any distributions described in Section 4.04(b)(xii).

“TIA” means the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) as amended.

“Total Assets” means the total consolidated assets of Holdings and the Restricted Subsidiaries of Holdings, as shown on the most recent consolidated balance sheet of Holdings and its Restricted Subsidiaries.

“Transactions” means, collectively, the Scheme and the other transactions contemplated in the Offering Memorandum as of the date hereof.

“Treasury Rate” means, as of the applicable redemption date, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15(519) that has become publicly available at least two Business Days prior to such redemption date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from such redemption date to October 1, 2014; provided, however, that if the period from such redemption date to October 1, 2014 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.

“Trust Officer” means, when used with respect to the Trustee, any officer of the Trustee within the Corporate Client Services Department (or any successor unit or department) of the Trustee assigned to the corporate trust office of the Trustee and responsible for administering this Indenture, and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of that officer’s knowledge of and familiarity with the particular subject.

“Trustee” means the party named as such in the Preamble to this Indenture until a successor replaces it and, thereafter, means the successor.

“Unrestricted Subsidiary” means:

(1) any Subsidiary of Holdings that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors of such Person in the manner provided below; and

(2) any Subsidiary of an Unrestricted Subsidiary.

The Board of Directors of the Issuers may designate any Subsidiary of Holdings (including any newly acquired or newly formed Subsidiary of Holdings but excluding Holdings) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Equity Interests or Indebtedness of, or owns or holds any Lien on any property of, Holdings or any

 

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other Subsidiary of Holdings that is not a Subsidiary of the Subsidiary to be so designated; provided, however, that the Subsidiary to be so designated and its Subsidiaries do not at the time of designation have and do not thereafter Incur any Indebtedness pursuant to which the lender has recourse to any of the assets of the Issuers or any of their Restricted Subsidiaries; provided, further, however, that either:

(a) the Subsidiary to be so designated has total consolidated assets of $1,000 or less; or

(b) if such Subsidiary has consolidated assets greater than $1,000, then such designation would be permitted under Section 4.04.

The Board of Directors of the Issuers may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that immediately after giving effect to such designation:

(x) (1) the Issuers could Incur $1.00 of additional Indebtedness pursuant to Section 4.03(a) or (2) the Fixed Charge Coverage Ratio for Holdings and its Restricted Subsidiaries would be greater than such ratio for Holdings and its Restricted Subsidiaries immediately prior to such designation, in each case on a pro forma basis taking into account such designation, and

(y) no Event of Default shall have occurred and be continuing.

Any such designation by the Board of Directors of the Issuers shall be evidenced to the Trustee by promptly filing with the Trustee a copy of the resolution of the Board of Directors of the Issuers giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the foregoing provisions.

“U.S. Government Obligations” means securities that are:

(1) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged, or

(2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America,

which, in each case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act) as custodian with respect to any such U.S. Government Obligations or a specific payment of principal of or interest on any such U.S. Government Obligations held by such custodian for the account of the holder of such depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government

 

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Obligations or the specific payment of principal of or interest on the U.S. Government Obligations evidenced by such depository receipt.

“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.

“Weighted Average Life to Maturity” means, when applied to any Indebtedness or Disqualified Stock, as the case may be, at any date, the quotient obtained by dividing (1) the sum of the products of the number of years from the date of determination to the date of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Disqualified Stock multiplied by the amount of such payment, by (2) the sum of all such payments.

“Wholly Owned Restricted Subsidiary” is any Wholly Owned Subsidiary that is a Restricted Subsidiary.

“Wholly Owned Subsidiary” of any Person means a Subsidiary of such Person 100% of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares or shares or interests required to be held by foreign nationals or other third parties to the extent required by applicable law) shall at the time be owned by such Person or by one or more Wholly Owned Subsidiaries of such Person and one or more Wholly Owned Subsidiaries of such Person.

SECTION 1.02. Other Definitions.

 

Term

   

Defined in
Section

“60 Day Post-Closing Period”

    11.01(a)

“Agent Members”

    Appendix A

“Affiliate Transaction”

    4.07(a)

“Asset Sale Offer”

    4.06(b)

“Bankruptcy Law”

    6.01

“Clearstream”

    Appendix A

“Change of Control Offer”

    4.08(b)

“covenant defeasance option”

    8.01

“Covenant Suspension Event”

    4.13(a)

“Custodian”

    6.01

“Definitive Security”

    Appendix A

“Depository”

    Appendix A

“Euroclear”

    Appendix A

“Event of Default”

    6.01

“Excess Proceeds”

    4.06(b)

“Exchange Securities”

    Preamble

“Global Securities”

    Appendix A

“Global Securities Legend”

    Appendix A

“Guaranteed Obligations”

    11.01(a)

 

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Term

   

Defined in
Section

“IAI”

    Appendix A

“incorporated provision”

    12.01

“Initial Purchasers”

    Appendix A

“Initial Securities”

    Preamble

“legal defeasance option”

    8.01

“Mortgage Policies”

    10.08(c)(ii)

“Notice of Default”

    6.01

“Offer Period”

    4.06(d)

“Original Securities”

    Preamble

“Paying Agent”

    2.04(a)

“Permitted Debt”

    4.03(b)

“protected purchaser”

    2.08

“Purchase Agreement”

    Appendix A

“QIB”

    Appendix A

“Refinancing Indebtedness”

    4.03(b)(xiv)

“Refunding Capital Stock”

    4.04(b)(ii)(A)

“Registration Rights Agreement”

    Appendix A

“Registered Exchange Offer”

    Appendix A

“Registrar”

    2.04(a)

“Regulation S”

    Appendix A

“Regulation S Global Securities”

    Appendix A

“Regulation S Securities”

    Appendix A

“Restricted Payment”

    4.04(a)

“Restricted Period”

    Appendix A

“Restricted Securities Legend”

    Appendix A

“Retired Capital Stock”

    4.04(b)(ii)(A)

“Reversion Date”

    4.13(b)

“Rule 3-10”

    12.02(b)(vi)

“Rule 3-10 Limitation”

    12.02(b)(vi)

“Rule 501”

    Appendix A

“Rule 144A”

    Appendix A

“Rule 144A Global Securities”

    Appendix A

“Rule 144A Securities”

    Appendix A

“Securities”

    Preamble

“Securities Custodian”

    Appendix A

“Shelf Registration Statement”

    Appendix A

“Specified Merger/Transfer Transaction”

    5.01(a)

“Successor Company”

    5.01(a)(i)

“Suspended Covenants”

    4.13(a)

“Suspension Period”

    4.13(b)

“Transfer Restricted Definitive Securities”

    Appendix A

“Transfer Restricted Global Securities”

    Appendix A

 

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Term

   

Defined in
Section

“Unrestricted Definitive Security”

    Appendix A

“Unrestricted Global Security”

    Appendix A

SECTION 1.03. Incorporation by Reference of Trust Indenture Act. This Indenture incorporates by reference certain provisions of the TIA. The following TIA terms have the following meanings:

“Commission” means the SEC.

“indenture securities” means the Securities and the Note Guarantees.

“indenture security holder” means a Holder.

“indenture to be qualified” means this Indenture.

“indenture trustee” or “institutional trustee” means the Trustee.

“obligor” on the indenture securities means the Issuers, the Note Guarantors and any other obligor on the Securities.

All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule have the meanings assigned to them by such definitions.

SECTION 1.04. Rules of Construction. Unless the context otherwise requires:

(a) a term has the meaning assigned to it;

(b) an accounting term not otherwise defined has the meaning assigned to it in accordance with IFRS-EU;

(c) “or” is not exclusive;

(d) “including” means including without limitation;

(e) words in the singular include the plural and words in the plural include the singular;

(f) the principal amount of any non-interest bearing or other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date prepared in accordance with IFRS-EU;

(g) the principal amount of any Preferred Stock shall be (i) the maximum liquidation value of such Preferred Stock or (ii) the maximum mandatory redemption or mandatory repurchase price with respect to such Preferred Stock, whichever is greater;

 

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(h) unless otherwise specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared in accordance with IFRS-EU;

(i) “$” and “U.S. Dollars” each refer to United States dollars, or such other money of the United States of America that at the time of payment is legal tender for payment of public and private debts;

(j) whenever in this Indenture or in any Security there is mentioned, in any context, principal, interest or any other amount payable under or with respect to any Securities, such mention shall be deemed to include mention of the payment of Additional Interest, to the extent that, in such context, Additional Interest is, was or would be payable in respect thereof; and

(k) for any periods or dates which the Issuers do not have historical financial statements available, it shall be entitled to use and rely on the financial statements of its predecessor or successor (as the case may be).

ARTICLE 2

THE SECURITIES

SECTION 2.01. Amount of Securities; Issuable in Series. The aggregate principal amount of Original Securities which may be authenticated and delivered under this Indenture on the Issue Date is $1,150,000,000. The Securities may be issued in one or more series. All Securities of any one series shall be substantially identical except as to denomination.

The Issuers may from time to time after the Issue Date issue Additional Securities under this Indenture in an unlimited principal amount, so long as (i) the Incurrence of the Indebtedness represented by such Additional Securities is at such time permitted by Section 4.03 and (ii) such Additional Securities are issued in compliance with the other applicable provisions of this Indenture. With respect to any Additional Securities issued after the Issue Date (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities pursuant to Sections 2.07, 2.08, 2.09, 2.10, 3.06, 3.08, 4.06(g), 4.08(c) or the Appendix), there shall be (a) established in or pursuant to a resolution of the Board of Directors of the Issuers and (b) (i) set forth or determined in the manner provided in an Officer’s Certificate or (ii) established in one or more indentures supplemental hereto, prior to the issuance of such Additional Securities:

(1) whether such Additional Securities shall be issued as part of a new or existing series of Securities and the title of such Additional Securities (which shall distinguish the Additional Securities of the series from Securities of any other series);

(2) the aggregate principal amount of such Additional Securities which may be authenticated and delivered under this Indenture;

 

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(3) the issue price and issuance date of such Additional Securities, including the date from which interest on such Additional Securities shall accrue;

(4) if applicable, that such Additional Securities shall be issuable in whole or in part in the form of one or more Global Securities and, in such case, the respective depositaries for such Global Securities, the form of any legend or legends which shall be borne by such Global Securities in addition to or in lieu of those set forth in Exhibit A hereto and any circumstances in addition to or in lieu of those set forth in Section 2.2 of the Appendix in which any such Global Security may be exchanged in whole or in part for Additional Securities registered, or any transfer of such Global Security in whole or in part may be registered, in the name or names of Persons other than the depositary for such Global Security or a nominee thereof; and

(5) if applicable, that such Additional Securities that are not Transfer Restricted Definitive Securities shall not be issued in the form of Initial Securities as set forth in Exhibit A, but shall be issued in the form of Exchange Securities as set forth in Exhibit B.

If any of the terms of any Additional Securities are established by action taken pursuant to a resolution of the Board of Directors of the Issuers, a copy of an appropriate record of such action shall be certified by the Secretary or any Assistant Secretary of the Issuers and delivered to the Trustee at or prior to the delivery of the Officer’s Certificate or the indenture supplemental hereto setting forth the terms of the Additional Securities.

SECTION 2.02. Form and Dating. Provisions relating to the Initial Securities and the Exchange Securities are set forth in the Appendix, which is hereby incorporated in and expressly made a part of this Indenture. The Initial Securities and the Trustee’s certificate of authentication, and any Additional Securities (if issued as Transfer Restricted Definitive Securities) and the Trustee’s certificate of authentication, shall each be substantially in the form of Exhibit A hereto, which is hereby incorporated in and expressly made a part of this Indenture. The Exchange Securities and the Trustee’s certificate of authentication, and any Additional Securities issued other than as Transfer Restricted Definitive Securities and the Trustee’s certificate of authentication, shall each be substantially in the form of Exhibit B hereto, which is hereby incorporated in and expressly made a part of this Indenture. The Securities may have notations, legends or endorsements required by law, stock exchange rule, agreements to which the Issuers or any Note Guarantor is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Issuers). Each Security shall be dated the date of its authentication. The Securities shall be issuable only in fully registered form without coupons and only in denominations of $2,000 and any integral multiples of $1,000 in excess thereof.

SECTION 2.03. Execution and Authentication. The Trustee shall authenticate and make available for delivery upon a written order of the Issuers signed by one Officer of each of the Issuers (an “Authentication Order”) (a) Original Securities for original issue on the date hereof in an aggregate principal amount of $1,150,000,000, (b) subject to the terms of this Indenture, Additional Securities in an aggregate principal amount to be determined at the time of issuance and specified therein and (c) the Exchange Securities for issue in a Registered Exchange Offer pursuant to the Registration Rights Agreement for a like principal amount of Initial

 

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Securities exchanged pursuant thereto or otherwise pursuant to an effective registration statement under the Securities Act. Such Authentication Order shall specify the amount of the Securities to be authenticated, the date on which the original issue of Securities is to be authenticated and whether the Securities are to be Initial Securities or Exchange Securities. Notwithstanding anything to the contrary in this Indenture or the Appendix, any issuance of Additional Securities after the Issue Date shall be in a principal amount of at least $2,000 and any integral multiples of $1,000 in excess thereof, whether such Additional Securities are of the same or a different series than the Original Securities.

One Officer of each Issuer shall sign the Securities for the Issuers by manual or facsimile signature.

If an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall be valid nevertheless.

A Security shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Security. The signature shall be conclusive evidence that the Security has been authenticated under this Indenture.

The Trustee may appoint one or more authenticating agents reasonably acceptable to the Issuers to authenticate the Securities. Any such appointment shall be evidenced by an instrument signed by a Trust Officer, a copy of which shall be furnished to the Issuers. Unless limited by the terms of such appointment, an authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as any Registrar, Paying Agent or agent for service of notices and demands.

SECTION 2.04. Registrar and Paying Agent.

(a) The Issuers shall maintain (i) an office or agency where Securities may be presented for registration of transfer or for exchange (the “Registrar”) and (ii) an office or agency in the United States where Securities may be presented for payment (the “Paying Agent”). The Registrar shall keep a register of the Securities and of their transfer and exchange. The Issuers may have one or more co-registrars and one or more additional paying agents. The term “Registrar” includes any co-registrars. The term “Paying Agent” includes the Paying Agent and any additional paying agents. The Issuers initially appoint the Trustee as (i) Registrar and Paying Agent in connection with the Securities and (ii) the Securities Custodian with respect to the Global Securities.

(b) The Issuers shall enter into an appropriate agency agreement with any Registrar or Paying Agent not a party to this Indenture, which shall incorporate the terms of the TIA. The agreement shall implement the provisions of this Indenture that relate to such agent. The Issuers shall notify the Trustee in writing of the name and address of any such agent. If the Issuers fail to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.07. Holdings or any of its domestically organized Wholly Owned Subsidiaries may act as Paying Agent or Registrar.

 

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(c) The Issuers may remove any Registrar or Paying Agent upon written notice to such Registrar or Paying Agent and to the Trustee; provided, however, that no such removal shall become effective until (i) if applicable, acceptance of an appointment by a successor as evidenced by an appropriate agreement entered into by the Issuers and such successor Registrar or Paying Agent, as the case may be, and delivered to the Trustee or (ii) written notification to the Trustee that the Trustee shall serve as Registrar or Paying Agent until the appointment of a successor in accordance with clause (i) above. The Registrar or Paying Agent may resign at any time upon written notice to the Issuers and the Trustee; provided, however, that the Trustee may resign as Paying Agent or Registrar only if the Trustee also resigns as Trustee in accordance with Section 7.08.

SECTION 2.05. Paying Agent to Hold Money in Trust. Prior to 10:00 a.m., New York City time, on each due date of the principal of and interest on any Security, the Issuers shall deposit with each Paying Agent (or if Holdings or a Wholly Owned Subsidiary is acting as Paying Agent, segregate and hold in trust for the benefit of the Persons entitled thereto) a sum sufficient to pay such principal and interest when so becoming due. The Issuers shall require each Paying Agent (other than the Trustee) to agree in writing that a Paying Agent shall hold in trust for the benefit of Holders or the Trustee all money held by a Paying Agent for the payment of principal of and interest on the Securities, and shall notify the Trustee in writing of any default by the Issuers in making any such payment. If Holdings or a Wholly Owned Subsidiary of Holdings acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it in trust for the benefit of the Persons entitled thereto. The Issuers at any time may require a Paying Agent to pay all money held by it to the Trustee and to account for any funds disbursed by such Paying Agent. During the continuance of a Default under this Indenture, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. Upon any bankruptcy or reorganization proceedings relating to the Issuers, the Trustee will serve as Paying Agent. Upon complying with this Section 2.05, a Paying Agent shall have no further liability for the money delivered to the Trustee.

SECTION 2.06. Holder Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders. If the Trustee is not the Registrar, the Issuers shall furnish, or cause the Registrar to furnish, to the Trustee, in writing at least five Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders.

SECTION 2.07. Transfer and Exchange. The Securities shall be issued in registered form and shall be transferable only upon the surrender of a Security for registration of transfer and in compliance with the Appendix. When a Security is presented to the Registrar with a request to register a transfer, the Registrar shall register the transfer as requested if its requirements therefor are met. When Securities are presented to the Registrar with a request to exchange them for an equal principal amount of Securities of other denominations, the Registrar shall make the exchange as requested if the same requirements are met. To permit registration of transfers and exchanges, the Issuers shall execute and upon receipt of an Authentication Order the Trustee shall authenticate Securities at the Registrar’s request. The Issuers may require payment of a sum sufficient to pay all taxes, assessments or other governmental charges in

 

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connection with any transfer or exchange pursuant to this Section 2.07. The Issuers shall not be required to make, and the Registrar need not register, transfers or exchanges of Securities selected for redemption (except, in the case of Securities to be redeemed in part, the portion thereof not to be redeemed) or of any Securities for a period of 15 days before a selection of Securities to be redeemed or tendered and not withdrawn in connection with a Change of Control Offer or an Asset Sale Offer.

Prior to the due presentation for registration of transfer of any Security, the Issuers, the Note Guarantors, the Trustee, each Paying Agent and the Registrar may deem and treat the Person in whose name a Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest, if any, on such Security and for all other purposes whatsoever, whether or not such Security is overdue, and none of the Issuers, any Note Guarantor, the Trustee, a Paying Agent or the Registrar shall be affected by notice to the contrary.

Any Holder of a beneficial interest in a Global Security shall, by acceptance of such beneficial interest, agree that transfers of beneficial interests in such Global Security may be effected only through a book-entry system maintained by (a) the Holder of such Global Security (or its agent) or (b) any Holder of a beneficial interest in such Global Security, and that ownership of a beneficial interest in such Global Security shall be required to be reflected in a book entry.

All Securities issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt and shall be entitled to the same benefits under this Indenture as the Securities surrendered upon such transfer or exchange.

SECTION 2.08. Replacement Securities. If a mutilated Security is surrendered to the Registrar or if the Holder of a Security claims that the Security has been lost, destroyed or wrongfully taken, the Issuers shall issue and the Trustee shall authenticate a replacement Security if the requirements of Section 8-405 of the Uniform Commercial Code are met, such that the Holder (a) satisfies the Issuers or the Trustee within a reasonable time after such Holder has notice of such loss, destruction or wrongful taking and the Registrar does not register a transfer prior to receiving such notification, (b) makes such request to the Issuers or the Trustee prior to the Security being acquired by a protected purchaser as defined in Section 8-303 of the Uniform Commercial Code (a “protected purchaser”) and (c) satisfies any other reasonable requirements of the Trustee. If required by the Trustee or the Issuers, such Holder shall furnish an indemnity bond sufficient in the judgment of (i) the Trustee to protect the Trustee or (ii) the Issuers, to protect the Issuers, the Trustee, a Paying Agent and the Registrar, from any loss that any of them may suffer if a Security is replaced. The Issuers and the Trustee may charge the Holder for their expenses in replacing a Security (including, without limitation, attorneys’ fees and disbursements in replacing such Security). In the event any such mutilated, lost, destroyed or wrongfully taken Security has become or is about to become due and payable, the Issuers in their discretion may pay such Security instead of issuing a new Security in replacement thereof.

Every replacement Security is an additional obligation of the Issuers.

 

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The provisions of this Section 2.08 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, lost, destroyed or wrongfully taken Securities.

SECTION 2.09. Outstanding Securities. Securities outstanding at any time are all Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation and those described in this Section 2.09 as not outstanding. Subject to Section 12.06, a Security does not cease to be outstanding because the Issuers or an Affiliate of the Issuers holds the Security.

If a Security is replaced pursuant to Section 2.08 (other than a mutilated Security surrendered for replacement), it ceases to be outstanding unless the Trustee and the Issuers receive proof satisfactory to them that the replaced Security is held by a protected purchaser. A mutilated Security ceases to be outstanding upon surrender of such Security and replacement thereof pursuant to Section 2.08.

If a Paying Agent segregates and holds in trust, in accordance with this Indenture, on a redemption date or maturity date money sufficient to pay all principal and interest payable on that date with respect to the Securities (or portions thereof) to be redeemed or maturing, as the case may be, and no Paying Agent is prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture, then on and after that date such Securities (or portions thereof) cease to be outstanding and interest on them ceases to accrue.

SECTION 2.10. Temporary Securities. In the event that Definitive Securities are to be issued under the terms of this Indenture, until such Definitive Securities are ready for delivery, the Issuers may prepare and the Trustee upon receipt of an Authentication Order shall authenticate temporary Securities. Temporary Securities shall be substantially in the form of Definitive Securities but may have variations that the Issuers consider appropriate for temporary Securities. Without unreasonable delay, the Issuers shall prepare and upon receipt of an Authentication Order the Trustee shall authenticate Definitive Securities and make them available for delivery in exchange for temporary Securities upon surrender of such temporary Securities at the office or agency of the Issuers, without charge to the Holder. Until such exchange, temporary Securities shall be entitled to the same rights, benefits and privileges as Definitive Securities.

SECTION 2.11. Cancellation. The Issuers at any time may deliver Securities to the Trustee for cancellation. The Registrar and each Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel all Securities surrendered for registration of transfer, exchange, payment or cancellation and shall dispose of canceled Securities in accordance with its customary procedures or deliver copies of canceled Securities to the Issuers pursuant to written direction by an Officer of any one of the Issuers. The Issuers may not issue new Securities to replace Securities it has redeemed, paid or delivered to the Trustee for cancellation. The Trustee shall not authenticate Securities in place of canceled Securities other than pursuant to the terms of this Indenture.

SECTION 2.12. Defaulted Interest. If the Issuers default in a payment of interest on the Securities, the Issuers shall pay the defaulted interest then borne by the Securities (plus interest on such defaulted interest to the extent lawful), in any lawful manner. The Issuers may pay the defaulted

 

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interest to the Persons who are Holders on a subsequent special record date. The Issuers shall fix or cause to be fixed any such special record date and payment date and shall promptly mail or cause to be mailed to each affected Holder a notice that states the special record date, the payment date and the amount of defaulted interest to be paid.

SECTION 2.13. CUSIP Numbers, ISINs, etc. The Issuer in issuing the Securities may use CUSIP numbers, ISINs and “Common Code” numbers (if then generally in use) and, if so, the Trustee shall use CUSIP numbers, ISINs and “Common Code” numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers, either as printed on the Securities or as contained in any notice of a redemption, that reliance may be placed only on the other identification numbers printed on the Securities and that any such redemption shall not be affected by any defect in or omission of such numbers; provided, further, that if any Additional Securities or Exchange Securities are not fungible with the Original Securities for U.S. federal income tax purposes, such Additional Securities or Exchange Securities will have a separate CUSIP number. The Issuer shall advise the Trustee in writing of any change in the CUSIP numbers, ISINs and “Common Code” numbers.

SECTION 2.14. Calculation of Specified Percentage of Securities. With respect to any matter requiring consent, waiver, approval or other action of the Holders of a specified percentage of the principal amount of all the Securities, such percentage shall be calculated, on the relevant date of determination, by dividing (a) the principal amount, as of such date of determination, of Securities, the Holders of which have so consented by (b) the aggregate principal amount, as of such date of determination, of the Securities then outstanding, in each case, as determined in accordance with the preceding sentence, Section 2.09 and Section 12.06 of this Indenture. Any such calculation made pursuant to this Section 2.14 shall be made by the Issuers and delivered to the Trustee pursuant to an Officer’s Certificate.

SECTION 2.15. No Listing of the Securities. The Securities shall not be quoted, listed or dealt in or on any exchange or over-the-counter market (including the PORTAL Market).

ARTICLE 3

REDEMPTION

SECTION 3.01. Redemption. The Securities may be redeemed, in whole, or from time to time in part, subject to the conditions and at the redemption prices set forth in Paragraph 5 of the form of Securities set forth in Exhibit A and Exhibit B hereto, which are hereby incorporated by reference and made a part of this Indenture, together with accrued and unpaid interest to the redemption date.

SECTION 3.02. Applicability of Article. Redemption of Securities at the election of the Issuers or otherwise, as permitted or required by any provision of this Indenture (including the optional redemption provisions of paragraph 5 of the applicable Security), shall be made in accordance with such provision and this Article 3.

 

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SECTION 3.03. Notices to Trustee. If the Issuers elect to redeem Securities pursuant to the optional redemption provisions of Paragraph 5 of the applicable Security, it shall notify the Trustee in writing of (i) the particular part of Paragraph 5 of the Security pursuant to which the redemption shall occur, (ii) the redemption date, (iii) the principal amount of Securities to be redeemed and (iv) the redemption price. The Issuers shall give notice to the Trustee provided for in this paragraph at least 30 days but not more than 60 days before a redemption date if the redemption is pursuant to Paragraph 5 of the applicable Security, unless a shorter period is acceptable to the Trustee. Any such notice may be canceled at any time prior to notice of such redemption being sent to any Holder and shall thereby be void and of no effect.

SECTION 3.04. Selection of Securities to Be Redeemed. In the case of any partial redemption, selection of the Securities for redemption will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which such Securities are listed, or if such Securities are not so listed, pro rata or by lot or such other method as the Trustee shall deem fair and appropriate (and in such manner as complies with applicable legal requirements); provided that the Trustee shall not select Securities for redemption which would result in a Holder of Securities with a principal amount of Securities less than the minimum denomination. The Trustee shall make the selection from outstanding Securities not previously called for redemption. The Trustee may select for redemption portions of the principal of Securities that have denominations larger than $2,000. Securities and portions of them the Trustee selects shall be in amounts of $2,000 or a whole multiple of $1,000 in excess thereof. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption. The Trustee shall notify the Issuers promptly of the Securities or portions of Securities to be redeemed.

SECTION 3.05. Notice of Optional Redemption.

(a) At least 30 days but not more than 60 days before a redemption date pursuant to Paragraph 5 of the applicable Security, the Issuers shall mail or cause to be mailed by first-class mail a notice of redemption to each Holder whose Securities are to be redeemed to such Holder’s registered address or otherwise in accordance with the procedures of the Depository; provided that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a satisfaction or discharge of this Indenture or defeasance of the Notes pursuant to the Indenture.

Any such notice shall identify the Securities to be redeemed and shall state:

(i) the redemption date;

(ii) the redemption price and the amount of accrued interest to the redemption date;

(iii) the name and address of a Paying Agent;

(iv) that Securities called for redemption must be surrendered to a Paying Agent to collect the redemption price, plus accrued interest;

 

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(v) if fewer than all the outstanding Securities are to be redeemed, the certificate numbers (if applicable) and principal amounts of the particular Securities to be redeemed, the aggregate principal amount of Securities to be redeemed and the aggregate principal amount of Securities to be outstanding after such partial redemption;

(vi) that, unless the Issuers default in making such redemption payment or any Paying Agent is prohibited from making such payment pursuant to the terms of this Indenture, interest on Securities (or portion thereof) called for redemption ceases to accrue on and after the redemption date;

(vii) the CUSIP number, ISIN and/or “Common Code” number, if any, printed on the Securities being redeemed; and

(viii) that no representation is made as to the correctness or accuracy of the CUSIP number or ISIN and/or “Common Code” number, if any, listed in such notice or printed on the Securities.

In addition, any such redemption may be subject to satisfaction of one or more conditions precedent, provided that in such case, such notice of redemption shall describe each such condition, and if applicable, shall state that, in the Issuers’ discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the stated redemption date, or by the redemption date as so delayed.

(b) At the Issuers’ request, the Trustee shall give the notice of redemption in the Issuers’ name and at the Issuers’ expense; provided, however, that the Issuers have delivered to the Trustee, at least 45 days (unless a shorter period is acceptable to the Trustee) prior to the redemption date, an Officer’s Certificate requesting that the Trustee give such notice. In such event, the Issuers shall provide the Trustee in writing with the information required by this Section 3.05.

SECTION 3.06. Effect of Notice of Redemption. Once notice of redemption is mailed in accordance with Section 3.05, Securities called for redemption become due and payable on the redemption date and at the redemption price stated in the notice (except to the extent such redemption is conditional as set forth in Section 3.05). Upon surrender to any Paying Agent, such Securities shall be paid at the redemption price stated in the notice, plus accrued interest to the redemption date; provided, however, that if the redemption date is after a regular record date and on or prior to the interest payment date, the accrued interest shall be payable to the Holder of the redeemed Securities registered on the relevant record date. Failure to give notice or any defect in the notice to any Holder shall not affect the validity of the notice to any other Holder.

SECTION 3.07. Deposit of Redemption Price. Prior to 10:00 a.m., New York City time, on the redemption date, the Issuers shall deposit with the Paying Agent (or, if Holdings or a Wholly Owned Subsidiary of Holdings is a Paying Agent, shall segregate and hold in trust) money sufficient to pay the redemption price of and accrued interest on all Securities or

 

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portions thereof to be redeemed on that date other than Securities or portions of Securities called for redemption that have been delivered by the Issuers to the Trustee for cancellation. On and after the redemption date, interest shall cease to accrue on Securities or portions thereof called for redemption so long as the Issuers have deposited with the Paying Agent funds sufficient to pay the principal of, plus accrued and unpaid interest on, the Securities to be redeemed, unless a Paying Agent is prohibited from making such payment pursuant to the terms of this Indenture.

SECTION 3.08. Securities Redeemed in Part. Upon surrender of a Security that is redeemed in part, the Issuers shall execute and upon receipt of an Authentication Order the Trustee shall authenticate for the Holder (at the Issuers’ expense) a new Security equal in principal amount to the unredeemed portion of the Security surrendered.

ARTICLE 4

COVENANTS

SECTION 4.01. Payment of Securities. The Issuers shall promptly pay the principal of and interest, on the Securities on the dates and in the manner provided in the Securities and in this Indenture. An installment of principal of or interest shall be considered paid on the date due if by 10:00 a.m. New York City time on such date the Trustee or any Paying Agent holds in accordance with this Indenture money sufficient to pay all principal and interest then due and the Trustee or any Paying Agent, as the case may be, are not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture.

The Issuers shall pay interest on overdue principal at the rate specified therefor in the Securities, and it shall pay interest on overdue installments of interest at the same rate borne by the Securities to the extent lawful.

SECTION 4.02. Reports and Other Information. Notwithstanding that Holdings may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting pursuant to rules and regulations promulgated by the SEC, Holdings shall file with the SEC (and provide the Trustee and Holders with copies thereof, without cost to each Holder, within 15 days after it files them with the SEC),

(a) within 90 days after the end of each fiscal year (or such longer period as may be permitted by the SEC if Holdings were then subject to such SEC reporting requirements as a non-accelerated filer), the information included in annual reports on Form 10-K (or any successor or comparable form) containing the information required to be contained therein (or required in such successor or comparable form) including, without limitation, a management’s discussion and analysis of financial information,

(b) within 45 days after the end of each of the first three fiscal quarters of each fiscal year (or such longer period as may be permitted by the SEC if Holdings were then subject to such SEC reporting requirements as a non-accelerated filer), the information included in quarterly reports on Form 10-Q (or any successor or comparable form) containing the information required to be contained therein (or required in such successor

 

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or comparable form) including, without limitation, a management’s discussion and analysis of financial information, and

(c) promptly from time to time after the occurrence of an event required to be therein reported (and in any event within the time period specified for filing current reports on Form 8-K by the SEC), such other reports on Form 8-K (or any successor or comparable form);

provided, however, that Holdings shall not be so obligated to file such reports with the SEC prior to the date that it files a registration statement with the SEC, or in the event that the SEC does not permit such filing, in which event Holdings shall put such information on its website, in addition to providing such information to the Trustee and the Holders, in each case within 15 days after the time Holdings would be required to file such information with the SEC if it were subject to Section 13 or 15(d) of the Exchange Act; provided, further, that until such time as Holdings is subject to Section 13 or 15(d) of the Exchange Act: such reports shall not be required to contain any exhibit, or comply with (i) Item 10(e) of Regulation S-K promulgated by the SEC, (ii) Section 302 or Section 404 of the Sarbanes-Oxley Act of 2002, or related Items 307 and 308 of Regulation S-K promulgated by the SEC; and (b) such reports shall not be required to contain the separate financial statements contemplated by Rule 3-09, Rule 3-10 or Rule 3-16 of Regulation S-X promulgated by the SEC. In addition, annual and quarterly reports provided pursuant to clauses (1) and (2) above shall include in footnote form, condensed consolidating financial information together with the with separate columns for: (i) Holdings; (ii) the Issuers; (iii) Note Guarantors (other than Holdings) on a combined basis; and (iv) any other Subsidiaries of Holdings on a combined basis; (v) consolidating adjustments; and (vi) the total consolidated amounts.

In addition, Holdings will make such information available to prospective investors upon request. In addition, Holdings has agreed that, for so long as any Securities remain outstanding during any period when it is not subject to Section 13 or 15(d) of the Exchange Act, or otherwise permitted to furnish the SEC with certain information pursuant to Rule 12g3-2(b) of the Exchange Act, it will furnish to the Holders of the Securities and to prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

Notwithstanding the foregoing, Holdings will be deemed to have furnished such reports referred to above to the Trustee and the Holders of the Securities if Holdings has filed such reports with the SEC via the EDGAR filing system and such reports are publicly available. In addition, such requirements shall be deemed satisfied prior to the commencement of the exchange offer contemplated by the Registration Rights Agreement relating to the Securities or the effectiveness of the Shelf Registration Statement by the filing with the SEC of the exchange offer registration statement and/or shelf registration statement in accordance with the provisions of such Registration Rights Agreement, and any amendments thereto, if such registration statement and/or amendments thereto are filed at times that otherwise satisfy the time requirements set forth in this Section 4.02.

Holdings will also hold quarterly conference calls for the Holders of the Securities to discuss financial information for the previous quarter. The conference call will be following the last day of each fiscal quarter of Holdings and not later than ten Business Days from the time

 

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that Holdings distributes the financial information as set forth in clauses (a) or (b) of this Section 4.02, as applicable. No fewer than two days prior to the conference call, Holdings shall post to their website the time and date of such conference call and providing instructions for Holders, securities analysts and prospective investors to obtain access to such call

In the event that any direct or indirect parent of Holdings is or becomes a Note Guarantor, the Indenture will permit Holdings to satisfy their obligations in this covenant with respect to financial information relating to Holdings by furnishing financial information relating to such direct or indirect parent.

Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including Holdings’ compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively (subject to Article 7) on Officer’s Certificates).

SECTION 4.03. Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred Stock.

(a)(i) Holdings shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, Incur any Indebtedness (including Acquired Indebtedness) or issue any shares of Disqualified Stock; and (ii) Holdings shall not permit any of its Restricted Subsidiaries of Holdings to issue any shares of Preferred Stock; provided, however, that Holdings and any Restricted Subsidiary of Holdings may Incur Indebtedness (including Acquired Indebtedness) or issue shares of Disqualified Stock and the Issuers and any Restricted Subsidiary that is a Note Guarantor may issue shares of Preferred Stock, in each case if the Fixed Charge Coverage Ratio of Holdings and its Restricted Subsidiaries for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is Incurred or such Disqualified Stock or Preferred Stock is issued would have been at least 2.00 to 1.00 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been Incurred, or the Disqualified Stock or Preferred Stock had been issued, as the case may be, and the application of proceeds therefrom had occurred at the beginning of such four-quarter period; provided, further, that the amount of Indebtedness (excluding Acquired Indebtedness not incurred in connection with or in contemplation of the applicable merger, acquisition or other similar transaction) that may be Incurred and Disqualified Stock or Preferred Stock that may be issued pursuant to the foregoing by Restricted Subsidiaries that are not Note Guarantors shall not exceed $100.0 million at any one time outstanding pursuant to this Section 4.03(a) and Section 4.03(b)(xxi) at such time.

(b) The limitations set forth in Section 4.03(a) shall not apply to (collectively, “Permitted Debt”):

(i) the Incurrence by Holdings or its Restricted Subsidiaries of Indebtedness under any Credit Agreement and the issuance and creation of letters of credit and bankers’ acceptances thereunder (with letters of credit and bankers’ acceptances being deemed to have a principal amount equal to the face amount thereof) up to an aggregate principal

 

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amount not to exceed $2,700.0 million outstanding at any one time, less (i) the amount of all permanent reductions of Indebtedness thereunder as a result of principal payments actually made with Net Cash Proceeds from Asset Sales and (ii) the aggregate principal amount of Indebtedness Incurred and outstanding pursuant to a Qualified Receivables Financing;

(ii) the Incurrence by the Issuers and the Note Guarantors of Indebtedness represented by the Original Securities and the Note Guarantees, as applicable (and any Exchange Securities and guarantees thereof);

(iii) Indebtedness and Preferred Stock existing on the Issue Date (other than Indebtedness described in clauses (i) and (ii) of this Section 4.03(b));

(iv) Indebtedness (including without limitation Capitalized Lease Obligations, mortgage financings or purchase money obligations) Incurred by Holdings or any of its Restricted Subsidiaries, Disqualified Stock issued by Holdings or any of its Restricted Subsidiaries and Preferred Stock issued by any Restricted Subsidiaries of Holdings to finance, all or any part of the purchase, lease, construction, installation, repair or improvement of property (real or personal), plant or equipment or other fixed capital assets used or useful in the business of Holdings or its Restricted Subsidiaries or in a Permitted Business (whether through the direct purchase of assets or the Capital Stock of any Person owning such assets) in an aggregate principal amount, including all Indebtedness Incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness Incurred pursuant to this clause (iv), not to exceed $150.0 million at the time of Incurrence, at any one time outstanding;

(v) Indebtedness in respect of any bankers’ acceptance, bank guarantees, letter of credit, warehouse receipt or similar facilities, and reinvestment obligations related thereto, entered into in the ordinary course of business; provided, however, that upon the drawing of such letters of credit, such obligations are reimbursed within 30 days following such drawing;

(vi) Indebtedness arising from agreements of Holdings or a Restricted Subsidiary of Holdings providing for indemnification, adjustment of purchase price or similar obligations, in each case, Incurred in connection with the disposition of any business, assets or a Subsidiary of the Issuers in accordance with the terms of this Indenture, other than guarantees of Indebtedness Incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition;

(vii) [Intentionally Omitted];

(viii) shares of Preferred Stock of a Restricted Subsidiary issued to Holdings or another Restricted Subsidiary; provided that any subsequent issuance or transfer of any Capital Stock or any other event that results in any Restricted Subsidiary that holds such shares of Preferred Stock of another Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such shares of Preferred Stock (except to

 

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Holdings or another Restricted Subsidiary) shall be deemed, in each case, to be an issuance of shares of Preferred Stock;

(ix) Indebtedness or Disqualified Stock of Holdings or a Restricted Subsidiary to another Restricted Subsidiary or to Holdings; provided that if an Issuer or a Note Guarantor Incurs such Indebtedness or issues such Disqualified Stock to a Restricted Subsidiary that is not an Issuer or a Note Guarantor such Indebtedness or Disqualified Stock, as applicable, is subordinated in right of payment to the Note Guarantee of such Note Guarantor; provided, further, that any subsequent issuance or transfer of any Capital Stock or any other event which results in any Restricted Subsidiary lending such Indebtedness or Disqualified Stock, as applicable, ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such Indebtedness or Disqualified Stock, as applicable (except to Holdings or another Restricted Subsidiary) shall be deemed, in each case, to be an Incurrence of such Indebtedness or Disqualified Stock, as applicable;

(x) Hedging Obligations that are Incurred in the ordinary course of business (and not for speculative purposes): (1) for the purpose of fixing or hedging interest rate risk with respect to any Indebtedness that is permitted by the terms of this Indenture to be outstanding; (2) for the purpose of fixing or hedging currency exchange rate risk with respect to any currency exchanges; or (3) for the purpose of fixing or hedging commodity price risk with respect to any commodity purchases;

(xi) obligations (including reimbursement obligations with respect to letters of credit and bank guarantees) in respect of performance, bid, appeal and surety bonds and completion guarantees provided by Holdings or any of its Restricted Subsidiaries in the ordinary course of business;

(xii) Indebtedness or Disqualified Stock of Holdings, the Issuers or any other Note Guarantor and Preferred Stock of the Issuers or any Note Guarantor that is a Restricted Subsidiary of Holdings in an aggregate principal amount or liquidation preference that, when aggregated with the principal amount or liquidation preference of all other Indebtedness, Disqualified Stock and Preferred Stock then outstanding and Incurred pursuant to this clause (xii), does not exceed the greater of 4.0% of Total Assets of Holdings and its Restricted Subsidiaries and $150.0 million at any one time outstanding;

(xiii) any guarantee by Holdings or its Restricted Subsidiary of Indebtedness or other obligations of Holdings or any of its Restricted Subsidiaries so long as the Incurrence of such Indebtedness or other obligations by Holdings or such Restricted Subsidiary is permitted under the terms of this Indenture; provided that if such Indebtedness is by its express terms subordinated in right of payment to the Securities or the Note Guarantee of such Restricted Subsidiary, as applicable, any such guarantee of such Note Guarantor with respect to such Indebtedness shall be subordinated in right of payment to such Note Guarantor’s Note Guarantee with respect to the Securities substantially to the same extent as such Indebtedness is subordinated to the Securities or the Note Guarantee of such Restricted Subsidiary, as applicable;

 

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(xiv) the Incurrence by Holdings or any of its Restricted Subsidiaries of Indebtedness or Disqualified Stock or Preferred Stock of a Restricted Subsidiary of Holdings that serves to refund, refinance, replace or defease any Indebtedness, Disqualified Stock or Preferred Stock Incurred as permitted under Section 4.03(a) and clauses (ii), (iii), (xiv), (xvii), (xix), (xx) and (xxi) of this Section 4.03(b) or any Indebtedness, Disqualified Stock or Preferred Stock Incurred to so refund or refinance such Indebtedness, Disqualified Stock or Preferred Stock, including any additional Indebtedness, Disqualified Stock or Preferred Stock Incurred to pay premiums, fees and expenses in connection therewith (subject to the following proviso, “Refinancing Indebtedness”) prior to its respective maturity; provided, however, that such Refinancing Indebtedness:

(1) has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is Incurred which is not less than the remaining Weighted Average Life to Maturity of the Indebtedness being refunded or refinanced;

(2) has a Stated Maturity which is no earlier than the Stated Maturity of the Indebtedness being refunded or refinanced;

(3) to the extent such Refinancing Indebtedness refinances (x) Subordinated Indebtedness, such Refinancing Indebtedness is Subordinated Indebtedness or (y) Disqualified Stock or Preferred Stock, such Refinancing Indebtedness is Disqualified Stock or Preferred Stock;

(4) is Incurred in an aggregate principal amount (or if issued with original issue discount, an aggregate issue price) that is equal to or less than the sum of (x) the aggregate principal amount (or if issued with original issue discount, the aggregate accreted value) then outstanding of the Indebtedness being refinanced plus (y) the amount of premium, fees and expenses Incurred in connection with such refinancing; and

(5) shall not include (x) Indebtedness of a Restricted Subsidiary of Holdings that is not an Issuer or a Note Guarantor that refinances Indebtedness of an Issuer or a Note Guarantor, or (y) Indebtedness of Holdings or a Restricted Subsidiary that refinances Indebtedness of an Unrestricted Subsidiary;

(xv) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business; provided that such Indebtedness is extinguished within five Business Days of its Incurrence;

(xvi) Indebtedness of Holdings or any Restricted Subsidiary of Holdings supported by a letter of credit or bank guarantee issued pursuant to the Credit Agreement, in a principal amount not in excess of the stated amount of such letter of credit or bank guarantee;

(xvii) Contribution Indebtedness;

 

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(xviii) Indebtedness of Holdings or any Restricted Subsidiary of Holdings consisting of (x) the financing of insurance premiums or (y) take-or-pay obligations contained in supply arrangements, in each case, in the ordinary course of business

(xix) Indebtedness of Foreign Subsidiaries of Holdings that are not Note Guarantors in an aggregate amount not to exceed $200.0 million at any one time outstanding;

(xx) Indebtedness Incurred by a Receivables Subsidiary in a Qualified Receivables Financing that is not recourse to Holdings or any Restricted Subsidiary of Holdings other than a Receivables Subsidiary (except for Standard Securitization Undertakings);

(xxi)(x) Indebtedness, Disqualified Stock or Preferred Stock of the Issuers or any Restricted Subsidiary of Holdings incurred to finance an acquisition or (y) Acquired Indebtedness of the Issuers or any Restricted Subsidiary of Holdings; provided that, in either case, after giving effect to the transactions that result in the incurrence or issuance thereof, on a pro forma basis, either (a) Holdings would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 4.03(a) or (b) the Fixed Charge Coverage Ratio of Holdings and its Restricted Subsidiaries would not be less than immediately prior to such transactions; provided, however, that on a pro forma basis, together with amounts incurred or issued and outstanding pursuant to Section 4.03(a), no more than $100.0 million of Indebtedness, Disqualified Stock or Preferred Stock at any one time outstanding and incurred or issued by a Restricted Subsidiary of Holdings that is not a Note Guarantor pursuant to this Section 4.03(b)(xxi) shall be incurred or issued and outstanding;

(xxii) Indebtedness incurred by the Issuers or any Restricted Subsidiary to the extent that the net proceeds thereof are promptly deposited to defease or to satisfy and discharge the Securities; and

(xxiii) Note Guarantees (a) incurred in the ordinary course of business in respect of obligations of (or to) suppliers, customers, franchisees, lessors and licensees that, in each case, are non-Affiliates or (b) otherwise constituting Investments permitted under this Indenture.

(c) For purposes of determining compliance with this Section 4.03, in the event that an item of Indebtedness, Disqualified Stock or Preferred Stock (or any portion thereof) meets the criteria of more than one of the categories of Permitted Debt or is entitled to be Incurred pursuant to Section 4.03(a), the Issuer shall, in their sole discretion, at the time of Incurrence, divide, classify or reclassify, or at any later time divide, classify or reclassify, such item of Indebtedness, Disqualified Stock or Preferred Stock (or any portion thereof) in any manner that complies with this Section 4.03; provided that all Indebtedness under the Credit Agreement outstanding on the Issue Date shall be deemed to have been Incurred pursuant to clause (i) of Section 4.03(b) and the Issuers shall not be permitted to reclassify all or any portion of such Indebtedness. Accrual of interest, the accretion of accreted value, the amortization of original issue discount, the payment of interest in the form of additional Indebtedness with the same terms, the payment of dividends on Disqualified Stock or Preferred Stock in the form of additional shares of Disqualified Stock or Preferred Stock of the same class, the accretion of liquidation preference

 

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and increases in the amount of Indebtedness outstanding solely as a result of fluctuations in the exchange rate of currencies shall not be deemed to be an Incurrence of Indebtedness, Disqualified Stock or Preferred Stock for purposes of this Section 4.03. Note Guarantees of, or obligations in respect of letters of credit relating to, Indebtedness that are otherwise included in the determination of a particular amount of Indebtedness shall not be included in the determination of such amount of Indebtedness; provided that the Incurrence of the Indebtedness represented by such guarantee or letter of credit, as the case may be, was in compliance with this Section 4.03.

(d) For purposes of determining compliance with any U.S. dollar-denominated restriction on the Incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was Incurred, in the case of term debt, or first committed or first Incurred (whichever yields the lower U.S. dollar equivalent), in the case of revolving credit debt; provided that if such Indebtedness is Incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced.

SECTION 4.04. Limitation on Restricted Payments.

(a) Holdings shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly:

(i) declare or pay any dividend or make any distribution on account of Holdings’ or any of its Restricted Subsidiaries’ Equity Interests, including any payment made in connection with any merger or consolidation involving Holdings (other than dividends, payments or distributions (A) payable solely in Equity Interests (other than Disqualified Stock) of Holdings or to Holdings and its Restricted Subsidiaries; or (B) by a Restricted Subsidiary or Holdings so long as, in the case of any dividend or distribution payable on or in respect of any class or series of securities issued by a Restricted Subsidiary other than a Wholly Owned Restricted Subsidiary, Holdings or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution in accordance with its Equity Interests in such class or series of securities);

(ii) purchase or otherwise acquire or retire for value any Equity Interests of Holdings or any direct or indirect parent of Holdings;

(iii) make any principal payment on, or redeem, repurchase, defease or otherwise acquire or retire for value, in each case prior to any scheduled repayment or scheduled maturity, any Subordinated Indebtedness (other than the payment, redemption, repurchase, defeasance, acquisition or retirement of (A) Subordinated Indebtedness in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of such payment, redemption, repurchase,

 

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defeasance, acquisition or retirement and (B) Indebtedness permitted under clause (ix) of Section 4.03(b)); or

(iv) make any Restricted Investment;

(all such payments and other actions set forth in clauses (i) through (iv) above being collectively referred to as “Restricted Payments”), unless, at the time of such Restricted Payment:

(1) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof;

(2) immediately after giving effect to such transaction on a pro forma basis, Holdings could Incur $1.00 of additional Indebtedness under Section 4.03(a); and

(3) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by Holdings and its Restricted Subsidiaries after the Issue Date (including Restricted Payments permitted by clauses (i), (ii) (with respect to Refunding Capital Stock), (vi), (viii), (xiii)(B), (xvi) and (xxiii) of Section 4.04(b), but excluding all other Restricted Payments permitted by Section 4.04(b)), is less than the sum of, without duplication,

(A) 50% of the Consolidated Net Income of Holdings for the period (taken as one accounting period) from January 1, 2011 to the end of Holdings’ most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, in the case such Consolidated Net Income for such period is a deficit, minus 100% of such deficit), plus

(B) 100% of the aggregate net proceeds, including cash and the Fair Market Value of assets other than cash, received by Holdings after the Issue Date from the issue or sale of Equity Interests of Holdings or any direct or indirect parent of Holdings (excluding (without duplication) Refunding Capital Stock, Designated Preferred Stock, Cash Contribution Amount, Excluded Contributions and Disqualified Stock), including Equity Interests issued upon conversion of Indebtedness or upon exercise of warrants or options (other than an issuance or sale to a Restricted Subsidiary of Holdings or an employee stock ownership plan or trust established by Holdings or any of its Subsidiaries), plus

(C) 100% of the aggregate amount of contributions to the capital of Holdings received in cash and the Fair Market Value of property other than cash after the Issue Date (other than Excluded Contributions, Refunding Capital Stock, Designated Preferred Stock and Disqualified Stock and the Cash Contribution Amount), plus

(D) the principal amount of any Indebtedness, or the liquidation preference or maximum fixed repurchase price, as the case may be, of any Disqualified Stock, of Holdings or any Restricted Subsidiary thereof issued after the Issue Date (other than Indebtedness or Disqualified Stock issued to Holdings or another

 

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Restricted Subsidiary) that has been converted into or exchanged for Equity Interests in Holdings or any direct or indirect parent of Holdings (other than Disqualified Stock), plus

(E) 100% of the aggregate amount received by Holdings or any Restricted Subsidiary in cash and the Fair Market Value of property other than cash received by Holdings or any Restricted Subsidiary from:

(I) the sale or other disposition (other than to Holdings or a Restricted Subsidiary) of Restricted Investments made by Holdings and its Restricted Subsidiaries and from repurchases and redemptions of such Restricted Investments from Holdings and its Restricted Subsidiaries by any Person (other than Holdings or any of its Subsidiaries) and from repayments of loans or advances which constituted Restricted Investments (other than in each case to the extent that the Restricted Investment was made pursuant to clause (vii) or (x) of Section 4.04(b)),

(II) the sale (other than to Holdings or a Restricted Subsidiary of Holdings) of the Capital Stock of an Unrestricted Subsidiary, or

(III) any distribution or dividend from an Unrestricted Subsidiary (to the extent such distribution or dividend is not already included in the calculation of Consolidated Net Income), plus

(F) in the event any Unrestricted Subsidiary of Holdings has been redesignated as a Restricted Subsidiary or has been merged or consolidated with or into, or transfers or conveys its assets to, or is liquidated into, Holdings or a Restricted Subsidiary of Holdings, in each case after the Issue Date, the Fair Market Value (as determined in accordance with the next succeeding sentence) of the Investment of Holdings in such Unrestricted Subsidiary at the time of such redesignation, combination or transfer (or of the assets transferred or conveyed, as applicable), after deducting any Indebtedness associated with the Unrestricted Subsidiary so designated or combined or any Indebtedness associated with the assets so transferred or conveyed (other than in each case to the extent that the designation of such Subsidiary as an Unrestricted Subsidiary was made pursuant to clause (vii) or (x) of Section 4.04(b) or constituted a Permitted Investment).

(b) The provisions of Section 4.04(a) shall not prohibit:

(i) the payment of any dividend or distribution or consummation of any irrevocable redemption within 60 days after the date of declaration thereof or giving of a redemption notice related thereto, if at the date of declaration or notice such payment would have complied with the provisions of this Indenture;

(ii)(A) the redemption, repurchase, retirement or other acquisition of any Equity Interests (“Retired Capital Stock”) of Holdings or any direct or indirect parent of Holdings or any Note Guarantor or Subordinated Indebtedness of Holdings or any Note

 

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Guarantor in exchange for, or out of the proceeds of the substantially concurrent sale of, Equity Interests of Holdings or any direct or indirect parent of Holdings or contributions to the equity capital of Holdings (other than any Disqualified Stock or any Equity Interests sold to Holdings or any Subsidiary of Holdings or to an employee stock ownership plan or any trust established by Holdings or any of its Subsidiaries) (collectively, including any such contributions, “Refunding Capital Stock”); and (B) the declaration and payment of accrued dividends on the Retired Capital Stock out of the proceeds of the substantially concurrent sale (other than to a Subsidiary of Holdings or to an employee stock ownership plan or any trust established by Holdings or any of its Subsidiaries) of Refunding Capital Stock;

(iii) the redemption, repurchase or other acquisition or retirement of Subordinated Indebtedness of an Issuer or any Note Guarantor made by exchange for, or out of the proceeds of the substantially concurrent sale of, new Indebtedness of an Issuer or any Note Guarantor that is Incurred in accordance with Section 4.03 so long as:

(A) the principal amount of such new Indebtedness does not exceed the principal amount (or accredited value, if applicable) of the Subordinated Indebtedness being so redeemed, repurchased, acquired or retired for value (plus the amount of any premium required to be paid under the terms of the instrument governing the Subordinated Indebtedness being so redeemed, repurchased, acquired or retired plus any fees and expenses Incurred in connection therewith);

(B) such Indebtedness is subordinated to the Securities or the related Note Guarantee, as the case may be, at least to the same extent as such Subordinated Indebtedness so purchased, exchanged, redeemed, repurchased, acquired or retired for value;

(C) such Indebtedness has a final scheduled maturity date no earlier than the final scheduled maturity date of the Subordinated Indebtedness being so redeemed, repurchased, acquired or retired; and

(D) such Indebtedness has a Weighted Average Life to Maturity that is not less than the remaining Weighted Average Life to Maturity of the Subordinated Indebtedness being so redeemed, repurchased, acquired or retired;

(iv) the purchase, retirement, redemption or other acquisition (or dividends to Holdings or any other direct or indirect parent of Holdings to finance any such purchase, retirement, redemption or other acquisition) for value of Equity Interests of Holdings or any direct or indirect parent of Holdings held by any future, present or former employee, director or consultant of Holdings or any direct or indirect parent of Holdings or any Subsidiary of Holdings or their estates or for the beneficiaries of such estates pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or other similar agreement or arrangement; provided, however, that the aggregate amounts paid under this clause (iv) do not exceed $20.0 million in any calendar year; provided, further, however, that such amount in any calendar year may be increased by an amount not to exceed:

 

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(A) the cash proceeds received by Holdings or any of its Restricted Subsidiaries from the sale of Equity Interests (other than Disqualified Stock) of Holdings or any direct or indirect parent of Holdings (to the extent contributed to Holdings) to members of management, directors or consultants of Holdings and its Restricted Subsidiaries or Holdings or any other direct or indirect parent of Holdings that occurs after the Issue Date (provided that the amount of such cash proceeds utilized for any such repurchase, retirement, other acquisition or dividend shall not increase the amount available for Restricted Payments under Section 4.04(a)(3)); plus

(B) the cash proceeds of key man life insurance policies received by Holdings or any direct or indirect parent of Holdings (to the extent contributed to Holdings) and its Restricted Subsidiaries after the Issue Date;

(provided that the Issuers may elect to apply all or any portion of the aggregate increase contemplated by clauses (A) and (B) above in any calendar year); in addition, cancellation of Indebtedness owing to the Issuers from any current or former officer, director or employee (or any permitted transferees thereof) of the Issuers or any of its Restricted Subsidiaries (or any direct or indirect parent company thereof), in connection with a repurchase of Equity Interests of the Issuers from such Persons will not be deemed to constitute a Restricted Payment for purposes of this covenant or any other provisions under this Indenture;

(v) the declaration and payment of dividends or distributions to Holders of any class or series of Disqualified Stock of Holdings or any of its Restricted Subsidiaries and Preferred Stock of any of its Restricted Subsidiaries issued or Incurred in accordance with Section 4.03;

(vi) the declaration and payment of dividends or distributions to Holders of any class or series of Designated Preferred Stock (other than Disqualified Stock) issued after the Issue Date and the declaration and payment of dividends to Holdings or any direct or indirect parent of Holdings, the proceeds of which will be used to fund the payment of dividends to Holders of any class or series of Designated Preferred Stock (other than Disqualified Stock) of Holdings or any direct or indirect parent of Holdings issued after the Issue Date; provided, however, that (A) for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date of issuance of such Designated Preferred Stock, after giving effect to such issuance (and the payment of dividends or distributions) on a pro forma basis, the Fixed Charge Coverage Ratio of Holdings and its Restricted Subsidiaries would have been at least 2.00 to 1.00 and (B) the aggregate amount of dividends declared and paid pursuant to this clause (vi) does not exceed the net cash proceeds actually received by Holdings from any such sale of Designated Preferred Stock (other than Disqualified Stock) issued after the Issue Date;

(vii) Investments in Unrestricted Subsidiaries having an aggregate Fair Market Value, taken together with all other Investments made pursuant to this clause (vii) that are at that time outstanding, not to exceed $100.0 million (with the Fair Market Value of

 

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each Investment being measured at the time made and without giving effect to subsequent changes in value), at any one time outstanding;

(viii) the payment of dividends on Holdings’ common stock (or the payment of dividends to any direct or indirect parent of Holdings to fund the payment by any direct or indirect parent of Holdings of dividends on such entity’s common stock) of up to 6.0% per annum of the net proceeds received by Holdings from any public offering of common stock or contributed to Holdings or any direct or indirect parent of Holdings from any public offering of common stock;

(ix) Restricted Payments that are made with Excluded Contributions;

(x) other Restricted Payments in an aggregate amount not to exceed $150.0 million at any one time outstanding;

(xi) the distribution, as a dividend or otherwise, of shares of Capital Stock of, or Indebtedness owed to Holdings or a Restricted Subsidiary of Holdings by, Unrestricted Subsidiaries;

(xii) the payment of any dividends or other distributions to any direct or indirect equity holder of Holdings, the Issuers or a Restricted Subsidiary in amounts required for such equity holder to pay U.S. federal, state, foreign or local income taxes (as the case may be) imposed directly on such equity holder to the extent such income taxes are attributable to the income of Holdings, the Issuers or such Restricted Subsidiary, as the case may be, by virtue of Holdings, the Issuers or Restricted Subsidiary being either a pass-through entity for tax purposes or a member of a consolidated or combined tax group of which Holdings, the Issuers or such Restricted Subsidiary is a member; provided, that in each case the amount of such payments in respect of any tax year does not exceed the amount that Holdings, the Issuers or Restricted Subsidiary, as the case may be, would have been required to pay in respect of U.S. federal, state, foreign or local taxes (as the case may be) for such year had Holdings, the Issuers or such Restricted Subsidiary paid such taxes as a stand-alone taxpayer (or stand-alone group) (reduced by any such taxes paid directly by Holdings, the Issuers or such Restricted Subsidiary;

(xiii) the payment of dividends, other distributions or other amounts to, or the making of loans to Holdings or any other direct or indirect parent, in the amount required for such entity to, if applicable:

(A) pay amounts equal to the amounts required for any direct or indirect parent of Holdings to pay fees and expenses (including franchise or similar taxes) required to maintain its corporate existence, customary salary, bonus and other benefits payable to, and indemnities provided on behalf of, officers and employees of Holdings or any direct or indirect parent of Holdings, if applicable, and general corporate operating and overhead expenses of any direct or indirect parent of Holdings, if applicable, in each case to the extent such fees, expenses, salaries, bonuses, benefits and indemnities are attributable to the ownership or operation of Holdings, if applicable, and its Subsidiaries; and

 

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(B) pay, if applicable, amounts equal to amounts required for any direct or indirect parent of Holdings, if applicable, to pay interest and/or principal on Indebtedness the proceeds of which have been contributed to Holdings or any of its Restricted Subsidiaries and that has been guaranteed by, or is otherwise considered Indebtedness of, Holdings or any of its Restricted Subsidiaries Incurred in accordance with Section 4.03; and

(C) pay fees and expenses Incurred by Holdings or any direct or indirect parent, other than to Affiliates of Holdings, related to any unsuccessful equity or debt offering of such parent; and

(D) payments to the Sponsor (a) pursuant to the Management Agreement or any amendment thereto (so long as such amendment is not less advantageous to the Holders of the Securities in any material respect than the Management Agreement) or (b) for any other financial advisory, financing, underwriting or placement services in respect of other investment banking activities, including, without limitation, in connection with acquisitions or divestitures, in each case to the extent permitted under Section 4.07(b)(xxi) and (xxii).

(xiv)(i) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price of such options or warrants and (ii) in connection with the withholding of a portion of the Equity Interests granted or awarded to a director or employee to pay for the taxes payable by such director or employee upon such grant or award;

(xv) purchases of receivables pursuant to a Receivables Repurchase Obligation in connection with a Qualified Receivables Financing and the payment or distribution of Receivables Fees;

(xvi) the payment, purchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Indebtedness, Disqualified Stock or Preferred Stock of Holdings and its Restricted Subsidiaries pursuant to provisions similar to those described under Section 4.06 and Section 4.08; provided that, prior to such payment, purchase, redemption, defeasance or other acquisition or retirement for value, the Issuers (or a third party to the extent permitted by this Indenture) have made a Change of Control Offer or Asset Sale Offer, as the case may be, with respect to the Securities as a result of such Change of Control or Asset Sale, as the case may be, and has repurchased all Securities validly tendered and not withdrawn in connection with such Change of Control Offer or Asset Sale Offer, as the case may be;

(xvii) any joint venture may make Restricted Payments required or permitted to be made pursuant to the terms of the joint venture arrangements to Holders of its Equity Interests;

(xviii) any Restricted Payments made in connection with the consummation of the Transactions;

 

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(xix) Restricted Payments made after the Issue Date to repurchase or redeem any Existing Notes not tendered in connection with the Transactions;

(xx) the payment of cash in lieu of the issuance of fractional shares of Equity Interests upon exercise or conversion of securities exercisable or convertible into Equity Interests of the Issuer;

(xxi) Holdings or any of its Restricted Subsidiaries may make Restricted Payments from funds held in the Loan Note Escrow Account to the Holders of the Loan Notes in accordance with the terms of the Loan Notes Instrument; and

(xxii) payments or distributions, in the nature of satisfaction of dissenters’ rights, pursuant to or in connection with a consolidation, merger or transfer of assets that complies with the provisions of the Indenture applicable to mergers, consolidations and transfers of all or substantially all the property and assets of the Issuer

provided, however, that at the time of, and after giving effect to, any Restricted Payment permitted under clauses (vi), (vii), (viii), (x), (xi) and (xvi) of this Section 4.04(b), no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof.

(c) Holdings shall not permit any Unrestricted Subsidiary to become a Restricted Subsidiary except pursuant to the definition of “Unrestricted Subsidiary.” For purposes of designating any Restricted Subsidiary as an Unrestricted Subsidiary, all outstanding Investments by Holdings and its Restricted Subsidiaries (except to the extent repaid) in the Subsidiary so designated shall be deemed to be Restricted Payments or Permitted Investments in an amount determined as set forth in the last sentence of the definition of “Investments.” Such designation shall only be permitted if a Restricted Payment or Permitted Investment in such amount would be permitted at such time and if such Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.

(d) For purposes of this Section 4.04, if any Investment or Restricted Payment would be permitted pursuant to one or more provisions described above and/or one or more of the exceptions contained in the definition of “Permitted Investments,” the Issuers may divide and classify such Investment or Restricted Payment in any manner that complies with this covenant and may later divide and reclassify any such Investment or Restricted Payment so long as the Investment or Restricted Payment (as so divided and/or reclassified) would be permitted to be made in reliance on the applicable exception as of the date of such reclassification.

SECTION 4.05. Dividend and Other Payment Restrictions Affecting Subsidiaries. Holdings shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or consensual restriction on the ability of any Restricted Subsidiary to:

(a) (i) pay dividends or make any other distributions to Holdings or any of its Restricted Subsidiaries (1) on its Capital Stock or (2) with respect to any other interest or participation in, or measured by, its profits; or (ii) pay any Indebtedness owed to Holdings or any of its Restricted Subsidiaries;

 

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(b) make loans or advances to Holdings or any of its Restricted Subsidiaries; or

(c) sell, lease or transfer any of its properties or assets to Holdings or any of its Restricted Subsidiaries;

except in each case for such encumbrances or restrictions existing under or by reason of:

(1) contractual encumbrances or restrictions in effect or entered into or existing on the Issue Date, including pursuant to the Credit Agreement and the other documents relating to the Transactions;

(2) this Indenture, the Securities and any Exchange Securities and guarantees thereof;

(3) applicable law or any applicable rule, regulation or order;

(4) any agreement or other instrument of a Person acquired by Holdings or any Restricted Subsidiary which was in existence at the time of such acquisition (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired;

(5) contracts or agreements for the sale of assets, including customary restrictions with respect to a Restricted Subsidiary imposed pursuant to an agreement entered into for the sale or disposition of all or substantially all the Capital Stock or assets of such Restricted Subsidiary;

(6) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business;

(7) customary provisions in joint venture agreements, operating or other similar agreements, asset sale agreements and stock sale agreements in connection with the entering into of such transaction in the ordinary course of business;

(8) purchase money obligations for property acquired and Capitalized Lease Obligations in the ordinary course of business that impose restrictions of the nature discussed in clause (c) above on the property so acquired;

(9) customary provisions contained in leases, licenses, contracts and other similar agreements entered into in the ordinary course of business that impose restrictions of the type described in clause (c) above on the property subject to such lease;

(10) any encumbrance or restriction of a Receivables Subsidiary effected in connection with a Qualified Receivables Financing; provided, however, that such restrictions apply only to such Receivables Subsidiary;

 

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(11) other Indebtedness, Disqualified Stock or Preferred Stock of any Restricted Subsidiary of Holdings that is Incurred subsequent to the Issue Date pursuant to Section 4.03; provided that such encumbrances and restrictions contained in any agreement or instrument will not materially affect the Issuers’ ability to make anticipated principal or interest payment on the Securities (as determined by the Issuers in good faith);

(12) any Restricted Investment not prohibited by Section 4.04 and any Permitted Investment;

(13) arising or agreed to in the ordinary course of business, not relating to any Indebtedness, and that do not, individually or in the aggregate, detract from the value of property or assets of the Issuers or any Restricted Subsidiary thereof in any manner material to the Issuers or any Restricted Subsidiary thereof;

(14) existing under, by reason of or with respect to Refinancing Indebtedness; provided that the encumbrances and restrictions contained in the agreements governing that Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced;

(15) contractual encumbrances or restrictions under the COLI Loans;

(16) restrictions contained in the Loan Notes Instrument; and

(17) any encumbrances or restrictions of the type referred to in clauses (a), (b) and (c) above imposed by any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in clauses (1) through (16) above; provided that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are, in the good faith judgment of the Issuers, no more restrictive as a whole with respect to such dividend and other payment restrictions than those contained in the dividend or other payment restrictions prior to such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing.

For purposes of determining compliance with this Section 4.05, (i) the priority of any Preferred Stock in receiving dividends or liquidating distributions prior to dividends or liquidating distributions being paid on common stock shall not be deemed a restriction on the ability to make distributions on Capital Stock and (ii) the subordination of loans or advances made to Holdings or a Restricted Subsidiary of Holdings to other Indebtedness Incurred by Holdings or any such Restricted Subsidiary shall not be deemed a restriction on the ability to make loans or advances.

SECTION 4.06. Asset Sales.

(a) Holdings shall not, and shall not permit any of its Restricted Subsidiaries to, cause or make an Asset Sale, unless:

 

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(1) Holdings or any of its Restricted Subsidiaries, as the case may be, receives consideration at the time of such Asset Sale at least equal to the Fair Market Value (as determined in good faith by Holdings) of the assets sold or otherwise disposed of; and

(2) except in the case of a Permitted Asset Swap, at least 75% of the consideration therefor received by Holdings or such Restricted Subsidiary, as the case may be, is in the form of Cash Equivalents; provided that the amount of:

(i) any liabilities (as shown on Holdings’ or such Restricted Subsidiary’s most recent balance sheet or in the notes thereto) of Holdings or any Restricted Subsidiary of Holdings (other than liabilities that are by their terms subordinated to the Securities) that are assumed by the transferee of any such assets or Equity Interests pursuant to an agreement that releases or indemnifies Holdings or such Restricted Subsidiary, as the case may be, from further liability;

(ii) any notes or other obligations or other securities or assets received by Holdings or such Restricted Subsidiary from such transferee that are converted by Holdings or such Restricted Subsidiary into cash within 180 days of the receipt thereof (to the extent of the cash received), and

(iii) any Designated Non-cash Consideration received by Holdings or any of its Restricted Subsidiaries in such Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-cash Consideration received pursuant to this clause (iii) that is at that time outstanding, not to exceed the greater of (x) $100.0 million and (y) 2.0% of Total Assets at the time of the receipt of such Designated Non-cash Consideration (with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value)

shall each be deemed to be Cash Equivalents for the purposes of this Section 4.06.

(b) Within 365 days after Holdings or any Restricted Subsidiary’s receipt of the Net Cash Proceeds of any Asset Sale, Holdings or such Restricted Subsidiary may apply the Net Cash Proceeds from such Asset Sale, at its option:

(i) to repay Indebtedness constituting Senior Obligations (and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto),

(ii) to repay Indebtedness constituting Second Lien Obligations (and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto) (provided that (x) to the extent that the terms of Second Lien Obligations other than the Second Lien Note Obligations and other than any capital markets debt securities require that such Second Lien Obligations are repaid with the Net Cash Proceeds of Asset Sales prior to repayment of other Indebtedness, the Issuers shall be entitled to repay such other Second Lien Obligations prior to repaying the Obligations under the Securities and (y) subject to the foregoing clause (x), if the Issuers or any Note

 

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Guarantor shall so reduce Second Lien Obligations, the Issuers will equally and ratably reduce Obligations under the Securities through open-market purchases (provided that such purchases are at or above 100% of the principal amount thereof) or by making an offer (in accordance with the procedures set forth below for an Asset Sale Offer) to all Holders to purchase at a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, the pro rata principal amount of notes);

(iii) to make an investment in any one or more businesses (provided that if such investment is in the form of the acquisition of Capital Stock of a Person, such acquisition results in such Person becoming a Restricted Subsidiary of Holdings), assets, or property or capital expenditures, in each case used or useful in a Similar Business;

(iv) to make an investment in any one or more businesses (provided that if such investment is in the form of the acquisition of Capital Stock of a Person, such acquisition results in such Person becoming a Restricted Subsidiary of Holdings), properties or assets that replace the properties and assets that are the subject of such Asset Sale, or

(v) any combination of the foregoing.

provided that Holdings and its Restricted Subsidiaries will be deemed to have complied with the provisions described in clauses (iii) and (iv) of this paragraph if and to the extent that, within 365 days after the Asset Sale that generated the Net Cash Proceeds, the Issuers have entered into and not abandoned or rejected a binding agreement to acquire the assets or Capital Stock of a Similar Business, make an Investment in Replacement Assets or make a capital expenditure in compliance with the provision described in clauses (iii) and (iv) of this paragraph, and that acquisition, purchase or capital expenditure is thereafter completed within 180 days after the end of such 365-day period.

Pending the final application of any such Net Cash Proceeds, Holdings or such Restricted Subsidiary of the Issuers may temporarily reduce Indebtedness under a revolving credit facility, if any, or otherwise invest such Net Cash Proceeds in Cash Equivalents or Investment Grade Securities. Any Net Cash Proceeds from any Asset Sale that are not applied as provided and within the time period set forth in the immediately preceding paragraph (it being understood that any portion of such Net Cash Proceeds used to make an offer to purchase Securities, as described in clause (i) above, shall be deemed to have been invested whether or not such offer is accepted) shall be deemed to constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $50.0 million, the Issuers shall make an offer to all Holders of Securities (and, at the option of the Issuers, to holders of any other Second Lien Obligations) (an “Asset Sale Offer”) to purchase the maximum principal amount of Securities (and such other Second Lien Obligations), that is at least $2,000 and an integral multiple of $1,000 that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof (or, in the event such other Second Lien Obligations were issued with significant original issue discount, 100% of the accreted value thereof), plus accrued and unpaid interest and additional interest, if any (or, in respect of such other Second Lien Obligations, such lesser price, if any, as may be provided for by the terms of such Second Lien Obligations), to the date fixed for the closing of such offer, in accordance with the procedures set forth in this

 

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Indenture. The Issuers shall commence an Asset Sale Offer with respect to Excess Proceeds within ten (10) Business Days after the date that Excess Proceeds exceed $50.0 million by mailing the notice required pursuant to the terms of Section 4.06(f), with a copy to the Trustee. To the extent that the aggregate amount of Securities (and such other Second Lien Obligations) tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Issuers may use any remaining Excess Proceeds for general corporate purposes. If the aggregate principal amount of Securities (and such other Second Lien Obligations) surrendered by Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Securities to be purchased in the manner described in Section 4.06(e). Upon completion of any such Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.

(c) The Issuers shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations to the extent such laws or regulations are applicable in connection with the repurchase of the Securities pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Indenture, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.

(d) Not later than the date upon which written notice of an Asset Sale Offer is delivered to the Trustee as provided above, the Issuers shall deliver to the Trustee an Officer’s Certificate as to (i) the amount of the Excess Proceeds, (ii) the allocation of the Net Cash Proceeds from the Asset Sales pursuant to which such Asset Sale Offer is being made and (iii) the compliance of such allocation with the provisions of Section 4.06(b). On such date, the Issuers shall also irrevocably deposit with the Trustee or with a Paying Agent (or, if the Issuers or a Wholly Owned Restricted Subsidiary is acting as a Paying Agent, segregate and hold in trust) an amount equal to the Excess Proceeds to be invested in Cash Equivalents, as directed in writing by the Issuers, and to be held for payment in accordance with the provisions of this Section 4.06. Upon the expiration of the period for which the Asset Sale Offer remains open (the “Offer Period”), the Issuers shall deliver to the Trustee for cancellation the Securities or portions thereof that have been properly tendered to and are to be accepted by the Issuers. The Trustee (or a Paying Agent, if not the Trustee) shall, on the date of purchase, mail or deliver payment to each tendering Holder in the amount of the purchase price. In the event that the Excess Proceeds delivered by the Issuers to the Trustee is greater than the purchase price of the Securities tendered, the Trustee shall deliver the excess to the Issuers promptly after the expiration of the Offer Period for application in accordance with Section 4.06.

(e) Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Issuers at the address specified in the notice at least three Business Days prior to the purchase date. Holders shall be entitled to withdraw their election if the Trustee or the Issuers receive not later than two Business Days prior to the purchase date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security which was delivered by the Holder for purchase and a statement that such Holder is withdrawing his election to have such Security purchased. If at the end of the Offer Period more Securities (and such Second Lien Obligations) are tendered pursuant to an Asset Sale Offer than the Issuers are required to purchase, selection of

 

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such Securities for purchase shall be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which such Securities are listed, or if such Securities are not so listed, on a pro rata basis or by lot or such other method as the Trustee shall deem fair and appropriate (and in such manner as complies with applicable legal requirements); provided that no Securities of $2,000 or less shall be purchased in part. Selection of such Second Lien Obligations will be made pursuant to the terms of such Second Lien Obligations.

(f) Notices of an Asset Sale Offer shall be mailed by first class mail, postage prepaid, or sent electronically, at least 30 but not more than 60 days before the purchase date to each Holder of Securities at such Holder’s registered address. If any Security is to be purchased in part only, any notice of purchase that relates to such Security shall state the portion of the principal amount thereof that has been or is to be purchased.

SECTION 4.07. Transactions with Affiliates.

(a) Holdings shall not, and shall not permit any Restricted Subsidiaries of Holdings to, directly or indirectly, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction or series of transactions, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate of Holdings (each of the foregoing, an “Affiliate Transaction”) involving aggregate consideration in excess of $15.0 million, unless:

(i) such Affiliate Transaction is on terms that are not materially less favorable to Holdings or the relevant Restricted Subsidiary than those that could have been obtained in a comparable transaction by Holdings or such Restricted Subsidiary with an unrelated Person; and

(ii) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $25.0 million, the Issuers deliver to the Trustee a resolution adopted in good faith by the majority of the Board of Directors of the Issuers or any direct or indirect parent of the Issuers, approving such Affiliate Transaction and set forth in an Officer’s Certificate certifying that such Affiliate Transaction complies with clause (i) above.

(b) The provisions of Section 4.07(a) shall not apply to the following:

(i) (A) transactions between or among Holdings and/or any of the Restricted Subsidiaries of Holdings (or an entity that becomes a Restricted Subsidiary as a result of such transaction) and (B) any merger or consolidation of Holdings or any direct parent company of Holdings; provided that such parent company shall have no material liabilities and no material assets other than cash, Cash Equivalents and the Capital Stock of Holdings and such merger or consolidation is otherwise in compliance with the terms of this Indenture and effected for a bona fide business purpose;

(ii) (x) Restricted Payments permitted by Section 4.04 and (y) Permitted Investments;

 

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(iii) the payment of reasonable and customary fees and reimbursements paid to, and indemnity and similar arrangements provided on behalf of, officers, directors, employees or consultants of Holdings or any Restricted Subsidiary or any direct or indirect parent of Holdings;

(iv) transactions in which Holdings or any of the Restricted Subsidiaries, as the case may be, delivers to the Trustee a letter from an Independent Financial Advisor stating that such transaction is fair to Holdings or such Restricted Subsidiary from a financial point of view or meets the requirements of clause (i) of Section 4.07(a);

(v) payments or loans (or cancellation of loans, advances or guarantees) or advances to employees or consultants or guarantees in respect thereof for bona fide business purposes in the ordinary course of business;

(vi) any agreement as in effect as of the Issue Date or any transaction contemplated thereby;

(vii) the existence of, or the performance by Holdings or any of its Restricted Subsidiaries of its obligations under the terms of any stockholders or similar agreement (including any registration rights agreement or purchase agreement related thereto) to which it is a party as of the Issue Date, and any amendment thereto or similar transactions, agreements or arrangements which it may enter into thereafter; provided, however, that the existence of, or the performance by Holdings or any of its Restricted Subsidiaries of its obligations under, any future amendment to any such existing transaction, agreement or arrangement or under any similar transaction, agreement or arrangement entered into after the Issue Date shall only be permitted by this clause (vii) to the extent that the terms of any such existing transaction, agreement or arrangement together with all amendments thereto, taken as a whole, or new transaction, agreement or arrangement are not otherwise more disadvantageous to the Holders of the Securities in any material respect than the original transaction, agreement or arrangement as in effect on the Issue Date;

(viii)(A) transactions with customers, clients, suppliers or purchasers or sellers of goods or services, in each case in the ordinary course of business and otherwise in compliance with the terms of this Indenture, which are fair to Holdings and the Restricted Subsidiaries of Holdings in the reasonable determination of Holdings, and are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated party or (B) transactions with joint ventures or Unrestricted Subsidiaries entered into in the ordinary course of business;

(ix) any transaction effected as part of a Qualified Receivables Financing;

(x) the sale or issuance of Equity Interests (other than Disqualified Stock) of Holdings;

(xi) the payment of annual management, consulting, monitoring and advisory fees to the Sponsor pursuant to the Management Agreement to the Sponsor in an aggregate

 

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amount in any fiscal year not to exceed $5.0 million, plus all out-of-pocket reasonable expenses Incurred by the Sponsor or any of its Affiliates in connection with the performance of management, consulting, monitoring, advisory or other services with respect to Holdings and its Restricted Subsidiaries;

(xii) payments by Holdings or any of its Restricted Subsidiaries to the Sponsor made for any financial advisory, financing, underwriting or placement services or in respect of other investment banking activities, including, without limitation, in connection with acquisitions or divestitures, which payments are (x) made pursuant to agreements with the Sponsor as in effect on the Issue Date or (y) approved by a majority of the Board of Directors of Holdings or any direct or indirect parent of Holdings in good faith;

(xiii) any contribution to the capital of Holdings or any Restricted Subsidiary;

(xiv) transactions permitted by, and complying with, the provisions of Section 5.01;

(xv) transactions between Holdings or any of its Restricted Subsidiaries and any Person, a director of which is also a director of Holdings or any direct or indirect parent of Holdings; provided, however, that such director abstains from voting as a director of Holdings or such direct or indirect parent of Holdings, as the case may be, on any matter involving such other Person;

(xvi) pledges of Equity Interests of Unrestricted Subsidiaries;

(xvii) any employment agreements entered into by Holdings or any of its Restricted Subsidiaries in the ordinary course of business;

(xviii) the issuances of securities or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment arrangements, stock option and stock ownership plans or similar employee benefit plans approved by the Board of Directors of Holdings or any direct or indirect parent of Holdings or of a Restricted Subsidiary of Holdings, as appropriate, in good faith;

(xix) the entering into of any tax sharing agreement or arrangement and any payments permitted by Section 4.04(b)(xii);

(xx) transactions to effect the Transactions and the payment of all fees and expenses related to the Transactions;

(xxi) any employment, consulting, service or termination agreement, or customary indemnification arrangements, entered into by the Issuers or any of their Restricted Subsidiaries with current, former or future officers and employees of the Issuer, Holdings or any of their respective Restricted Subsidiaries and the payment of compensation to officers and employees of the Issuer, Holdings or any of their respective Restricted Subsidiaries (including amounts paid pursuant to employee benefit plans, employee stock option or similar plans), in each case in the ordinary course of business;

 

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(xxii) transactions with a Person that is an Affiliate of the Issuers solely because the Issuers, directly or indirectly, own Equity Interests in, or control, such Person entered into in the ordinary course of business;

(xxiii) transactions pursuant to any contracts, instruments or other agreements or arrangements in each case as in effect on the date of the Indenture, and any transactions contemplated thereby, or any amendment, modification or supplement thereto or any replacement thereof entered into from time to time, as long as such agreement or arrangement as so amended, modified, supplemented or replaced, taken as a whole, is not materially more disadvantageous to the Issuers and their Restricted Subsidiaries at the time executed than the original agreement or arrangement as in effect on the date of the Indenture;

(xxiv) transactions with Affiliates solely in their capacity as Holders of Indebtedness or Equity Interests of the Issuers or any of their Subsidiaries, so long as such transaction is with all Holders of such class (and there are such non-Affiliate Holders) and such Affiliates are treated no more favorably than all other Holders of such class generally; and

(xxv) transactions in which the Issuers or any of their Restricted Subsidiaries, as the case may be, deliver to the trustee a letter from an independent financial advisor stating that such transaction is fair to the Issuers or such Restricted Subsidiary from a financial point of view or meets the requirements of Section 4.07(a).

SECTION 4.08. Change of Control.

(a) Upon the occurrence of a Change of Control, each Holder shall have the right to require the Issuers to repurchase all or any part of such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of repurchase (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date), in accordance with the terms contemplated in this Section 4.08; provided, however, that notwithstanding the occurrence of a Change of Control, the Issuers shall not be obligated to purchase any Securities pursuant to this Section 4.08 in the event that it has exercised its right to redeem such Securities in accordance with Article 3 of this Indenture.

(b) Within 30 days following any Change of Control, except to the extent that the Issuers have exercised their right to redeem the Securities in accordance with Article 3 of this Indenture, the Issuers shall mail a notice (a “Change of Control Offer”) to each Holder with a copy to the Trustee describing:

(i) that a Change of Control has occurred and that such Holder has the right to require the Issuers to purchase such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, to the date of purchase (subject to the right of the Holders of record on a record date to receive interest on the relevant interest payment date);

 

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(ii) the transaction or transactions constitute a Change of Control;

(iii) the repurchase date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is sent); and

(iv) the instructions determined by the Issuers that a Holder must follow in order to have its Securities purchased.

(c) Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Issuer at the address specified in the notice at least three Business Days prior to the purchase date. The Holders shall be entitled to withdraw their election if the Trustee or the Issuers receive not later than two Business Days prior to the purchase date a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security which was delivered for purchase by the Holder and a statement that such Holder is withdrawing his election to have such Security purchased. Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered.

(d) On the purchase date, all Securities purchased by the Issuers under this Section shall be delivered to the Trustee for cancellation, and the Issuers shall pay the purchase price plus accrued and unpaid interest to the Holders entitled thereto.

(e) Notwithstanding the foregoing provisions of this Section 4.08, the Issuers shall not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in Section 4.08(b) applicable to a Change of Control Offer made by the Issuers and purchases all Securities validly tendered and not withdrawn under such Change of Control Offer.

(f) At the time the Issuers deliver Securities to the Trustee which are to be accepted for purchase, the Issuers shall also deliver an Officer’s Certificate stating that such Securities are to be accepted by the Issuers pursuant to and in accordance with the terms of this Section 4.08. A Security shall be deemed to have been accepted for purchase at the time the Trustee or the Paying Agent, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.

(g) Prior to any Change of Control Offer, the Issuers shall deliver to the Trustee an Officer’s Certificate stating that all conditions precedent contained herein to the right of the Issuers to make such offer have been complied with.

(h) The Issuers shall comply, to the extent applicable, with the requirements of Rule14(e)-1 of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Securities pursuant to this Section 4.08. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.08, the Issuers shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Section 4.08 by virtue of such compliance.

 

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(i) A Change of Control Offer may be made in advance of a Change of Control, and conditioned upon such Change of Control.

SECTION 4.09. Compliance Certificate. The Issuers shall deliver to the Trustee within 120 days after the end of each fiscal year of the Issuers an Officer’s Certificate stating that in the course of the performance by the signers of their duties as Officers of the Issuers they would normally have knowledge of any Default and whether or not the signers know of any Default that occurred during such period. If they do, the certificate shall describe the Default, its status and what action the Issuers are taking or proposes to take with respect thereto. From the date on which this Indenture is qualified under the TIA, the Issuers also shall comply with Section 314(a)(4) of the TIA.

SECTION 4.10. Future Guarantors. Subject to the requirements to provide certain guarantees within the 60 Day Post-Closing Period, if Holdings acquires or creates any Restricted Subsidiary after the Issue Date (unless such Subsidiary is (i) a Foreign Subsidiary that is not a guarantor under the Credit Agreement nor any capital markets debt of an Issuer or Note Guarantor, (ii) a Receivables Subsidiary, (iii) an entity that would trigger a Rule 3-10 Limitation as reasonably determined by Holdings, or (iv) already a Note Guarantor) that guarantees any Indebtedness of Holdings, the Issuers or any other Note Guarantor, Holdings shall cause such Subsidiary, within 20 Business Days of the date that such Indebtedness has been guaranteed, (a) to execute and deliver to the Trustee a supplemental indenture pursuant to which such Subsidiary will become a Note Guarantor under this Indenture and (b) (i) with respect to any Subsidiary (other than a Foreign Subsidiary), to become a party to the Security Agreement and (ii) with respect to a Foreign Subsidiary, (A) if any Credit Agreement is then outstanding, within the later of (1) 20 Business Days after entering into such supplemental indenture or (2) the time at which such Foreign Subsidiary becomes a party to the collateral documents relating to the Credit Agreement and (B) if no Credit Agreement is then outstanding, within 60 days after entering into such supplemental indenture become a party to any existing Collateral Documents or additional Collateral Documents as may be appropriate (in the reasonable determination of the Credit Agreement Collateral Agent, such determination not to be inconsistent with the determination made under the Credit Agreement, if any, or if there is no Credit Agreement Collateral Agent, in the reasonable determination of the Issuers) in the relevant jurisdiction and to execute and file all documents and instruments necessary to grant to the Collateral Agent a perfected lien on and security interest (or an equivalent requirement) in the Collateral of such Subsidiary to the extent practical and applicable (and, to the extent relevant, consistent with the Collateral Documents executed on the Issue Date or pursuant to Section 10.08 hereof) in the relevant jurisdiction in the reasonable determination of the Credit Agreement Collateral Agent, if any, or if there is no Credit Agreement Collateral Agent, in the reasonable determination of the Issuers, such determination not to be inconsistent with the determination made under the Credit Agreement, if any, or if there is no Credit Agreement Collateral Agent, in the reasonable determination of the Issuers).

 

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SECTION 4.11. Liens. Holdings shall not, and shall not permit any of the Restricted Subsidiaries to, directly or indirectly, create, Incur or suffer to exist any Lien (other than Permitted Liens) on any asset or property of Holdings or such Restricted Subsidiary.

SECTION 4.12. Maintenance of Office or Agency.

(a) The Issuers shall maintain in the United States, an office or agency (which may be an office of the Trustee or an affiliate of the Trustee or Registrar) where Securities may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Issuers in respect of the Securities and this Indenture may be served. The Issuers shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Issuers shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the corporate trust office of the Trustee as set forth in Section 12.02.

(b) The Issuers may also from time to time designate one or more other offices or agencies where the Securities may be presented or surrendered for any or all such purposes and may from time to time rescind such designations. The Issuers shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

(c) The Issuers hereby designates the corporate trust office of the Trustee or its agent, as such office or agency of the Issuers in accordance with Section 2.04.

SECTION 4.13. Discharge and Suspension of Covenants.

(a) If on any date following the Issue Date (i) the Securities have Investment Grade Ratings from both Rating Agencies, and (ii) no Default has occurred and is continuing under this Indenture (the occurrence of the events described in the foregoing clauses (i) and (ii) being collectively referred to as a “Covenant Suspension Event”), Section 4.03, Section 4.04, Section 4.05, Section 4.06, Section 4.07, Section 4.10 and clause (iv) of Section 5.01(a) (collectively, the “Suspended Covenants”) shall no longer be applicable to such Securities.

(b) In the event that Holdings and the Restricted Subsidiaries are not subject to the Suspended Covenants under this Indenture for any period of time pursuant to Section 4.13(a) (any such period, a “Suspension Period”), and on any subsequent date (the “Reversion Date”) one or both of the Rating Agencies withdraw their Investment Grade Rating or downgrade the rating assigned to the Securities below an Investment Grade, then Holdings and the Restricted Subsidiaries shall thereafter again be subject to the Suspended Covenants under this Indenture with respect to future events.

(c) Upon the occurrence of a Covenant Suspension Event, the amount of Excess Proceeds from Net Cash Proceeds shall be reset at zero.

(d) In the event of any reinstatement of the Suspended Covenants pursuant to Section 4.13(b), no action taken or omitted to be taken by Holdings or any of its Restricted

 

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Subsidiaries prior to such reinstatement will give rise to a Default or Event of Default under this Indenture with respect to any Securities; provided that (1) with respect to Restricted Payments made after any such reinstatement, the amount of Restricted Payments made shall be calculated as though Section 4.04 had been in effect prior to, but not during the Suspension Period, provided that no Subsidiaries may be designated as Unrestricted Subsidiaries during the Suspension Period, and (2) all Indebtedness Incurred, or Disqualified Stock or Preferred Stock issued, during the Suspension Period shall be classified to have been Incurred or issued pursuant to clause (iii) of Section 4.03(b). In addition, for purposes of Section 4.07, all agreements and arrangements entered into by Holdings and any Restricted Subsidiary with an Affiliate of Holdings during the Suspension Period prior to such Reversion Date will be deemed to have been entered into on or prior to the Issue Date and for purposes of Section 4.05, all contracts entered into during the Suspension Period prior to such Reversion Date that contain any of the restrictions contemplated by such Section will be deemed to have been existing on the Issue Date.

(e) The Issuers shall provide an Officer’s Certificate to the Trustee indicating the occurrence of any Covenant Suspension Event or Reversion Date. The Trustee will have no obligation to (i) independently determine or verify if such events have occurred, (ii) make any determination regarding the impact of actions taken during the Suspension Period on Holdings’ and its Subsidiaries’ future compliance with their covenants or (iii) notify the Holders of any Covenant Suspension Event or Reversion Date.

SECTION 4.14. Maintenance of Insurance. Holdings and the Issuers shall maintain with financially sound and reputable insurance companies, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons similarly situated, of such types and in such amounts (after giving effect to any self-insurance, in each case, as Holdings believes (in the good faith judgment of management of Holdings) reasonable and customary for similarly situated Persons engaged in the same or similar businesses as Holdings and the Issuers) as are customarily carried under similar circumstances by such other Persons.

Holdings and the Issuers shall use commercially reasonable efforts to ensure that that all such insurance with respect to any Collateral shall provide that no cancellation thereof shall be effective until at least 10 days (or, to the extent reasonably available, 30 days) after receipt by the Collateral Agent of written notice thereof and (ii) all insurance with respect to any Collateral shall name the Collateral Agent as mortgagee (in the case of property insurance) or additional insured on behalf of the Secured Parties (in the case of liability insurance) and loss payee (in the case of property insurance), as applicable.

SECTION 4.15. Further Assurances. The Issuers, Holdings and the Note Guarantors shall, promptly upon reasonable request by the Trustee or Collateral Agent, and subject to the limitations described in Section 4.16 and Section 10.08(c), (i) correct any material defect or error that may be discovered in the execution, acknowledgment, filing or recordation of any Collateral Document or other document or instrument relating to any Collateral, and (ii) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such further acts, deeds, certificates, assurances and other instruments as the Trustee or Collateral Agent may reasonably request from time to time in order to carry out more effectively the

 

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purposes of the Collateral Documents, to the extent required pursuant to Section 10.08(c) or the Collateral Documents.

SECTION 4.16. Additional Collateral. Not later than ninety (90) days after the acquisition by the Issuers, Holdings or any Note Guarantor of real property which constitutes “Material Real Property” (as such term is defined in the Credit Agreement) as determined by the Issuers (acting reasonably and in good faith) (or such longer period as the Credit Agreement Collateral Agent may agree in writing in its sole discretion), which property would not be automatically subject to another Lien pursuant to pre-existing Collateral Documents, cause such property to be subject to a second-priority Lien and Mortgage in favor of the Collateral Agent for the benefit of the Secured Parties and take, or cause the relevant Note Guarantor to take, such actions as shall be necessary to grant and perfect or record such Lien, in each case to the extent required by, and subject to the limitations and exceptions of, Section 10.08(c) and to otherwise comply with the requirements of Section 10.08(c).

ARTICLE 5

SUCCESSOR COMPANY

SECTION 5.01. When Issuers May Merge or Transfer Assets.

(a) Neither of the Issuers shall consolidate or merge with or into or wind up into (whether or not such Issuer is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions to, any Person unless:

(i) such Issuer is the surviving corporation or the Person formed by or surviving any such consolidation or merger (if other than such Issuer) or to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made is a corporation, partnership or limited liability company organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof (the Issuer or such Person, as the case may be, being herein called the “Successor Company”) and, if such entity is not a corporation, a co-obligor of the Securities is a corporation organized or existing under such laws;

(ii) the Successor Company (if other than such Issuer) expressly assumes all the obligations of such Issuer under this Indenture, the Securities and the Collateral Documents pursuant to supplemental indentures or other documents or instruments;

(iii) immediately after giving effect to such transaction (and treating any Indebtedness that becomes an obligation of the Successor Company or any of its Restricted Subsidiaries as a result of such transaction as having been Incurred by the Successor Company or such Restricted Subsidiary at the time of such transaction) no Default or Event of Default shall have occurred and be continuing;

 

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(iv) immediately after giving pro forma effect to such transaction, as if such transaction had occurred at the beginning of the applicable four-quarter period, either

(A) the Successor Company would be permitted to Incur at least $1.00 of additional Indebtedness pursuant to Section 4.03(a); or

(B) the Fixed Charge Coverage Ratio for the Successor Company and its Restricted Subsidiaries would be greater than such ratio for Holdings and its Restricted Subsidiaries immediately prior to such transaction;

(v) if the Successor Company is other than such Issuer, each Note Guarantor, unless it is the other party to the transactions described above, shall have by supplemental indenture confirmed that its Note Guarantee shall apply to such Person’s obligations under this Indenture and the Securities; and

(vi) the Issuers shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indentures (if any) comply with this Indenture.

The Successor Company (if other than such Issuer) shall succeed to, and be substituted for, an Issuer under this Indenture, the Securities and the Collateral Documents, and in such event, the Issuer shall automatically be released and discharged from its obligations under this Indenture, the Securities and the Collateral Documents. Notwithstanding the foregoing clauses (iii) and (iv) of this Section 5.01(a), (a) an Issuer may consolidate with, merge into or sell, assign, transfer, lease, convey or otherwise dispose of all or part of its properties and assets to Holdings, the Issuers or to any Restricted Subsidiary, and (b) an Issuer may merge or consolidate with an Affiliate incorporated or organized solely for the purpose of reincorporating or reorganizing the Issuers in another state of the United States, the District of Columbia or any territory of the United States and (c) the Transactions may occur so long as the amount of Indebtedness of such Issuer and its Restricted Subsidiaries is not increased thereby (any transaction described in this sentence, a “Specified Merger/Transfer Transaction”).

(b) Subject to the provisions of Section 11.02(b) (which govern the release of a Note Guarantee upon the sale or disposition of Holdings or its Restricted Subsidiary (other than an Issuer) that is a Note Guarantor, each Note Guarantor shall not, and Holdings shall not permit any Note Guarantor to, consolidate or merge with or into or wind up into (whether or not such Note Guarantor is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions to, any Person (other than the Transactions) unless:

(i) such sale or disposition or consolidation or merger is not in violation of Section 4.06;

(ii) immediately after giving effect to such transaction (and treating any Indebtedness which becomes an obligation of the Successor Guarantor or any of its Subsidiaries as a result of such transaction as having been Incurred by the Successor

 

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Guarantor or such Subsidiary at the time of such transaction) no Default or Event of Default shall have occurred and be continuing; and

(iii) the Successor Guarantor (if other than such Note Guarantor) shall have delivered or caused to be delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with this Indenture.

The Successor Guarantor shall succeed to, and be substituted for, such Note Guarantor under this Indenture and such Note Guarantor’s Note Guarantee, and such Note Guarantor will automatically be released and discharged from its obligations under this Indenture and such Note Guarantor’s Note Guarantee. Notwithstanding the foregoing, (1) a Note Guarantor may merge or consolidate with an Affiliate incorporated or organized solely for the purpose of reincorporating or reorganizing such Note Guarantor in another state of the United States, the District of Columbia or any territory of the United States, so long as the amount of Indebtedness of the Note Guarantor is not increased thereby, (2) a Note Guarantor may merge or consolidate with another Note Guarantor or the Issuers, and (3) a Note Guarantor may convert into a corporation, partnership, limited partnership, limited liability corporation or trust organized or existing under the laws of the jurisdiction of organization of such Note Guarantor.

ARTICLE 6

DEFAULTS AND REMEDIES

SECTION 6.01. Events of Default. An “Event of Default” occurs if:

(a) the Issuers default in any payment of interest on any Security of such series when the same becomes due and payable, and such default continues for a period of 30 days,

(b) the Issuers default in the payment of principal or premium, if any, of any Security when due at its Stated Maturity, upon optional redemption, upon required repurchase, upon declaration or otherwise,

(c) Holdings or any of its Restricted Subsidiaries fails to comply with the provisions of Section 5.01 or the provisions described under Section 11.01 for 30 days after written notice by the Trustee or Holders representing 25% or more of the aggregate principal amount of Securities outstanding,

(d) Holdings or any of its Restricted Subsidiaries fails to comply with any of its agreements contained in the Securities or this Indenture (other than those referred to in (a), (b), or (c) above) and such failure continues for 60 days after receipt of a related written Notice of Default as specified below,

(e) Holdings or any Significant Subsidiary of Holdings fails to pay any Indebtedness (other than Indebtedness owing to Holdings or its Restricted Subsidiary) within any applicable grace period after final maturity or the acceleration of any such

 

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Indebtedness by the Holders thereof because of a default, in each case, if the total amount of such Indebtedness unpaid or accelerated exceeds $50.0 million or its foreign currency equivalent,

(f) Holdings or any Significant Subsidiary of Holdings pursuant to or within the meaning of any Bankruptcy Law:

(i) commences a voluntary case;

(ii) consents to the entry of an order for relief against it in an involuntary case;

(iii) consents to the appointment of a Custodian of it or for any substantial part of its property; or

(iv) makes a general assignment for the benefit of its creditors or takes any comparable action under any foreign laws relating to insolvency,

(g) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

(i) is for relief against Holdings or any Significant Subsidiary of Holdings in an involuntary case;

(ii) appoints a Custodian of Holdings or any Significant Subsidiary of Holdings or for any substantial part of its property; or

(iii) orders the winding up or liquidation of Holdings or any Significant Subsidiary of Holdings;

or any similar relief is granted under any foreign laws and the order or decree remains unstayed and in effect for 90 days,

(h) Holdings or any Significant Subsidiary of Holdings fails to pay final and non-appealable judgments aggregating in excess of $50.0 million or its foreign currency equivalent (net of any amounts which are covered by enforceable insurance policies issued by solvent carriers), which judgments are not discharged, waived or stayed for a period of 60 days following the entry thereof and, in the event such judgment is covered by insurance, an enforcement proceeding has been commenced by any creditor upon such judgment or decree which is not promptly stayed, or

(i) the Note Guarantee of a Significant Subsidiary of Holdings ceases to be in full force and effect in any material respect (except as contemplated by the terms thereof) or any such Note Guarantor denies or disaffirms its obligations under this Indenture or any Note Guarantee and such Default continues for 21 days after notice of such Default shall have been given to the Trustee,

 

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(j) unless all of the Collateral has been released in accordance with the provisions of the Collateral Documents from the Liens granted thereunder, an Issuer shall assert or any Note Guarantor shall assert, in any pleading in any court of competent jurisdiction, that any such security interest is invalid or unenforceable and, in the case of any such Person that is a Subsidiary of Holdings, Holdings fails to cause such Subsidiary to rescind such assertions within 30 days after Holdings has actual knowledge of such assertions, or

(k) the failure by an Issuer or any Note Guarantor to comply for 60 days after written notice with its other agreements contained in the Collateral Documents except for a failure that would not be material to the Holders of the Securities and would not materially affect the value of the Collateral taken as a whole.

The foregoing shall constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body.

The term “Bankruptcy Law” means Title 11, United States Code, or any similar Federal or state law for the relief of debtors. The term “Custodian” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.

A Default under clause (c), (d) or (k) above shall not constitute an Event of Default until the Trustee notifies the Issuers in writing or the Holders of at least 25% of the aggregate principal amount of the outstanding Securities notify the Issuers and the Trustee in writing of the Default and the Issuers do not cure such Default within the time specified in clauses (c), (d) or (k) above, as applicable, after receipt of such notice. Such notice must specify the Default, demand that it be remedied and state that such notice is a “Notice of Default.” The Issuers shall deliver to the Trustee, within thirty (30) days after the occurrence thereof, written notice of any event which is, or with the giving of notice or the lapse of time or both would become, an Event of Default, its status and what action the Issuers are taking or propose to take with respect thereto.

SECTION 6.02. Acceleration. If an Event of Default (other than an Event of Default specified in Section 6.01(g) or (h) with respect to the Issuers) occurs and is continuing, the Trustee by written notice to the Issuers or the Holders of at least 25% of the aggregate principal amount of outstanding Securities by written notice to the Issuers and the Trustee, may declare the principal of, premium, if any, and accrued but unpaid interest on all the Securities to be due and payable. Upon such a declaration, such principal and interest shall be due and payable immediately. If an Event of Default specified in Section 6.01(g) or (h) with respect to the Issuers occurs, the principal of, premium, if any, and interest on all the Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders. The Holders of a majority in principal amount of the Securities by notice to the Trustee may rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived except nonpayment of principal or interest that has become due solely because of acceleration.

 

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No such rescission shall affect any subsequent Default or impair any right consequent thereto.

In the event of any Event of Default specified in Section 6.01(e), such Event of Default and all consequences thereof (excluding, however, any resulting payment default) shall be annulled, waived and rescinded, automatically and without any action by the Trustee or the Holders of the Securities, if within 20 days after such Event of Default arose the Issuers deliver an Officer’s Certificate to the Trustee stating that (x) the Indebtedness or guarantee that is the basis for such Event of Default has been discharged or (y) the Holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default or (z) the default that is the basis for such Event of Default has been cured, it being understood that in no event shall an acceleration of the principal amount of the Securities as described above be annulled, waived or rescinded upon the happening of any such events.

SECTION 6.03. Other Remedies. If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy at law or in equity to collect the payment of principal of or interest on the Securities or to enforce the performance of any provision of the Securities or this Indenture.

The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative to the extent permitted by law.

SECTION 6.04. Waiver of Past Defaults. Provided the Securities are not then due and payable by reason of a declaration of acceleration, the Holders of a majority in principal amount of the Securities by notice to the Trustee may waive an existing Default or Event of Default and its consequences except (a) a Default or Event of Default in the payment of the principal of or interest on a Security or (b) a Default or Event of Default in respect of a provision that under Section 9.02 cannot be amended without the consent of each Holder affected. When a Default is waived, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture, but no such waiver shall extend to any subsequent or other Default or impair any consequent right.

SECTION 6.05. Control by Majority. The Holders of a majority in principal amount of the Securities then outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture or, subject to Section 7.01, that the Trustee determines is unduly prejudicial to the rights of any other Holder or that would involve the Trustee in personal liability; provided, however, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. Prior to taking any action under this Indenture, the Trustee shall be entitled to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.

 

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SECTION 6.06. Limitation on Suits.

(a) Except to enforce the right to receive payment of principal, premium, if any, or interest when due, no Holder may pursue any remedy with respect to this Indenture or the Securities unless:

(i) the Holder gives to the Trustee written notice stating that an Event of Default is continuing;

(ii) the Holders of at least 25% of the aggregate principal amount of the Securities then outstanding make a written request to the Trustee to pursue the remedy;

(iii) such Holder or Holders offer to the Trustee security or indemnity reasonably satisfactory to it against any loss, liability or expense;

(iv) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of security or indemnity; and

(v) the Holders of a majority in principal amount of the Securities do not give the Trustee a direction inconsistent with the request during such 60-day period.

(b) A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder.

SECTION 6.07. Rights of the Holders to Receive Payment. Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of principal of and interest on the Securities held by such Holder, on or after the respective due dates expressed or provided for in the Securities, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder; provided that a Holder shall not have the right to institute any such suit for the enforcement of payment if and to the extent that the institution or prosecution thereof or the entry of judgment therein would, under applicable law, result in the surrender, impairment, waiver or loss of the Lien of this Indenture upon any property subject to such Lien.

SECTION 6.08. Collection Suit by Trustee. If an Event of Default specified in Section 6.01(a) or (b) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Issuers or any other obligor on the Securities for the whole amount then due and owing (together with interest on overdue principal and (to the extent lawful) on any unpaid interest at the rate provided for in the Securities) and the amounts provided for in Section 7.07.

SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for reasonable compensation, expenses disbursements and advances of the Trustee (including counsel, accountants, experts or such other professionals as the Trustee deems reasonably necessary, advisable or appropriate)) and the Holders allowed in any judicial proceedings relative to the Issuers or any Note Guarantor, their creditors

 

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or their property, shall be entitled to participate as a member, voting or otherwise, of any official committee of creditors appointed in such matters and, unless prohibited by law or applicable regulations, may vote on behalf of the Holders in any election of a trustee in bankruptcy or other Person performing similar functions, and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under Section 7.07.

No provision of this Indenture shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

SECTION 6.10. Priorities. Subject to the terms of the Intercreditor Agreements and Collateral Documents, if the Trustee collects any money or property pursuant to this Article 6, it shall pay out the money or property in the following order:

FIRST: to the Trustee for amounts due under Section 7.07 and the Collateral Agent due under Section 10.02;

SECOND: to Holders for amounts due and unpaid on the Securities for principal, premium, if any, and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and

THIRD: to the Issuers or, to the extent the Trustee collects any amount for any Note Guarantor, to such Note Guarantor.

The Trustee, upon prior written notice to the Issuers and the Note Guarantors, may fix a record date and payment date for any payment to the Holders pursuant to this Section 6.10. At least 15 days before such record date, the Trustee shall send to each Holder and the Issuers a notice that states the record date, the payment date and amount to be paid.

SECTION 6.11. Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in principal amount of the Securities then outstanding.

SECTION 6.12. Waiver of Stay or Extension Laws. Neither the Issuers nor any Note Guarantor (to the extent it may lawfully do so) shall at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law

 

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wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Issuers and each Note Guarantor (to the extent that it may lawfully do so) hereby expressly waive all benefit or advantage of any such law, and shall not hinder, delay or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law had been enacted.

ARTICLE 7

TRUSTEE AND COLLATERAL AGENT

SECTION 7.01. Duties of Trustee and Collateral Agent.

(a) If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.

(b) Except during the continuance of an Event of Default:

(i) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

(ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, in the case of certificates or opinions required by any provision hereof to be provided to it, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the form requirements of this Indenture.

(c) Neither the Trustee nor the Collateral Agent may be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:

(i) this paragraph does not limit the effect of paragraph (b) of this Section 7.01;

(ii) neither the Trustee nor the Collateral Agent shall be liable for any error of judgment made in good faith by a Trust Officer unless it is proved that the Trustee or Collateral Agent was negligent in ascertaining the pertinent facts;

(iii) neither the Trustee nor the Collateral Agent shall be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05; and

 

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(iv) no provision of this Indenture shall require the Trustee or the Collateral Agent to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers.

(d) Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01.

(e) Neither the Trustee nor the Collateral Agent shall be liable for interest on any money received by it except as the Trustee or Collateral Agent may agree in writing with the Issuers.

(f) Money held in trust by the Trustee or Collateral Agent need not be segregated from other funds except to the extent required by law.

(g) Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 7.01 and, from the date on which this Indenture is qualified under the TIA, to the provisions of the TIA.

SECTION 7.02. Rights of Trustee and Collateral Agent.

(a) The Trustee and Collateral Agent may conclusively rely on any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee and Collateral Agent need not investigate any fact or matter stated in the document.

(b) Before the Trustee or Collateral Agent acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel or both. Neither the Trustee nor the Collateral Agent shall be liable for any action it takes or omits to take in good faith in reliance on the Officer’s Certificate or Opinion of Counsel.

(c) The Trustee and Collateral Agent may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.

(d) Neither the Trustee nor the Collateral Agent shall be liable for any action it takes or omits to take in good faith which it reasonably believes to be authorized or within its rights or powers; provided, however, that the Trustee’s or Collateral Agent’s conduct, as applicable, does not constitute willful misconduct or negligence.

(e) The Trustee and Collateral Agent each may consult with counsel of its own selection and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Securities shall be full and complete authorization and protection from liability in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.

(f) Neither the Trustee nor the Collateral Agent shall be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond, debenture, note or other paper or

 

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document unless requested in writing to do so by the Holders of not less than a majority in principal amount of the Securities at the time outstanding, but the Trustee and Collateral Agent, in its discretion, may each make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee or Collateral Agent shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Issuers, personally or by agent or attorney, at the expense of the Issuers and shall incur no liability of any kind by reason of such inquiry or investigation.

(g) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

(h) The rights, privileges, protections, immunities and benefits given to the Trustee and Collateral Agent, including its right to be indemnified, are extended to, and shall be enforceable by, each of the Trustee and Collateral Agent in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.

(i) In the event the Issuers are required to pay Additional Interest, the Issuers will provide written notice to the Trustee of the Issuers’ obligation to pay Additional Interest no later than 15 days prior to the next interest payment date, which notice shall set forth the amount of the Additional Interest to be paid by the Issuers. The Trustee shall not at any time be under any duty or responsibility to any Holders to determine whether the Additional Interest is payable and the amount thereof.

(j) In no event shall the Trustee or the Collateral Agent, Paying Agent or Registrar or in any other capacity hereunder, be liable under or in connection with this Indenture for indirect, special, incidental, punitive or consequential losses or damages of any kind whatsoever, including but not limited to lost profits, whether or not foreseeable, even if the Trustee has been advised of the possibility thereof and regardless of the form of action in which such damages are sought.

SECTION 7.03. Individual Rights of Trustee and Collateral Agent. The Trustee and Collateral Agent each in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Issuers or their Affiliates with the same rights it would have if it were not Trustee or Collateral Agent. Any Paying Agent or Registrar may do the same with like rights. However, the Trustee and Collateral Agent must comply with Sections 7.10 and 7.11.

SECTION 7.04. Trustee’s and Collateral Agent’s Disclaimer. The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture, any Note Guarantee or the Securities, it shall not be accountable for the Issuers’ use of the proceeds from the Securities, and it shall not be responsible for any statement of the Issuers or any Note Guarantor in this Indenture or in any document issued in connection with the sale of the Securities or in the Securities other than the Trustee’s certificate of authentication. Neither the Trustee nor the Collateral Agent shall be charged with knowledge of any Default or Event of

 

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Default under Sections 6.01(c), (d), (e), (f), (i), (j) or (k) or of the identity of any Significant Subsidiary unless either (a) a Trust Officer shall have actual knowledge thereof or (b) the Trustee or Collateral Agent shall have received written notice thereof in accordance with Section 12.02 from the Issuers, any Note Guarantor or any Holder.

SECTION 7.05. Notice of Defaults. If a Default or Event of Default occurs and is continuing and if a Trust Officer has actual knowledge thereof, the Trustee shall mail by first class mail to each Holder at the address set forth in the Notes Register notice of the Default or Event of Default within 90 days after it is actually known to a Trust Officer. Except in the case of a Default or Event of Default in payment of principal of, premium (if any), interest or Additional Interest (if any) on any Note (including payments pursuant to the optional redemption or required repurchase provisions of such Note), the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of Holders.

SECTION 7.06. Reports by Trustee to the Holders. From the date on which this Indenture is qualified under the TIA, as promptly as practicable after each August 30 beginning with the August 30 following the date of this Indenture, and in any event within 12 months of the last such report, the Trustee shall send to each Holder a brief report dated as of such August 30 that complies with Section 313(a) of the TIA if and to the extent required thereby. From the date on which this Indenture is qualified under the TIA, the Trustee shall also comply with Section 313(b)(2) of the TIA.

A copy of each report at the time of its delivery to the Holders shall be filed with the SEC and each stock exchange (if any) on which the Securities are listed. The Issuers agree to notify promptly the Trustee whenever the Securities become listed on any stock exchange and of any delisting thereof.

SECTION 7.07. Compensation and Indemnity. The Issuers shall pay to the Trustee and Collateral Agent from time to time compensation for their services as agreed to in writing. The Trustee’s and Collateral Agent’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Issuers shall reimburse the Trustee and Collateral Agent upon request for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Trustee’s and Collateral Agent’s agents, counsel, accountants and experts. The Issuers and each Note Guarantor, jointly and severally shall indemnify the Trustee and Collateral Agent against any and all loss, liability, claim, damage or expense (including reasonable attorneys’ fees and expenses) incurred by or in connection with the acceptance or administration of this trust and the performance of its duties hereunder, including the costs and expenses of enforcing this Indenture or Note Guarantee against the Issuers or a Note Guarantor (including this Section 7.07) and defending itself against or investigating any claim (whether asserted by the Issuers, any Note Guarantor, any Holder or any other Person). The Trustee and Collateral Agent shall each notify the Issuers of any claim for which it may seek indemnity promptly upon obtaining actual knowledge thereof; provided, however, that any failure so to notify the Issuers shall not relieve the Issuers or any Note Guarantor of its indemnity obligations hereunder. The Issuers shall defend the claim

 

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and the indemnified party shall provide reasonable cooperation at the Issuers’ expense in the defense. Such indemnified parties may have separate counsel and the Issuers and the Note Guarantors, as applicable shall pay the fees and expenses of such counsel; provided, however, that the Issuers shall not be required to pay such fees and expenses if it assumes such indemnified parties’ defense and, in such indemnified parties’ reasonable judgment, there is no conflict of interest between the Issuers and the Note Guarantors, as applicable, and such parties in connection with such defense. The Issuers need not reimburse any expense or indemnify against any loss, liability or expense incurred by an indemnified party through such party’s own willful misconduct, negligence or bad faith.

To secure the Issuers’ and the Note Guarantors’ payment obligations in this Section 7.07, the Trustee and Collateral Agent shall have a Lien prior to the Securities on all money or property held or collected by the Trustee and Collateral Agent other than money or property held in trust to pay principal of and interest on particular Securities.

The Issuers’ and the Note Guarantors’ payment obligations pursuant to this Section 7.07 shall survive the satisfaction or discharge of this Indenture, any rejection or termination of this Indenture under any bankruptcy law or the resignation or removal of the Trustee or Collateral Agent. Without prejudice to any other rights available to the Trustee or Collateral Agent under applicable law, when the Trustee or Collateral Agent incurs expenses after the occurrence of a Default specified in Section 6.01(g) or (h) with respect to the Issuers, the expenses are intended to constitute expenses of administration under the Bankruptcy Law.

SECTION 7.08. Replacement of Trustee and Collateral Agent.

(a) The Trustee and Collateral Agent may resign at any time by so notifying the Issuers. The Holders of a majority in principal amount of the Securities may remove the Trustee or Collateral Agent by so notifying the Trustee or Collateral Agent and may appoint a successor Trustee or Collateral Agent. The Issuers may remove the Trustee or Collateral Agent if:

(i) the Trustee or Collateral Agent fails to comply with Section 7.10;

(ii) the Trustee or Collateral Agent is adjudged bankrupt or insolvent;

(iii) a receiver or other public officer takes charge of the Trustee or Collateral Agent or their respective property; or

(iv) the Trustee or Collateral Agent otherwise becomes incapable of acting.

If the Trustee or Collateral Agent has or shall acquire a conflicting interest within the meaning of the TIA, the Trustee or Collateral Agent shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the TIA and this Indenture.

(b) If the Trustee or Collateral Agent resigns, is removed by the Issuers or by the Holders of a majority in principal amount of the Securities and such Holders do not

 

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reasonably promptly appoint a successor Trustee or successor Collateral Agent, or if a vacancy exists in the office of Trustee or Collateral Agent for any reason (the Trustee or Collateral Agent in such event being referred to herein as the retiring Trustee or retiring Collateral Agent), the Issuers shall promptly appoint a successor Trustee or successor Collateral Agent.

(c) A successor Trustee or successor Collateral Agent shall deliver a written acceptance of its appointment to the retiring Trustee or retiring Collateral Agent and to the Issuers. Thereupon the resignation or removal of the retiring Trustee or retiring Collateral Agent shall become effective, and the successor Trustee or successor Collateral Agent shall have all the rights, powers and duties of the Trustee or Collateral Agent under this Indenture. The successor Trustee or successor Collateral Agent shall mail a notice of its succession to the Holders. The retiring Trustee or retiring Collateral Agent shall promptly transfer all property held by it as Trustee or Collateral Agent to the successor Trustee or successor Collateral Agent, subject to the Lien provided for in Section 7.07.

(d) If a successor Trustee or successor Collateral Agent does not take office within 60 days after the retiring Trustee or retiring Collateral Agent resigns or is removed, the retiring Trustee or retiring Collateral Agent or the Holders of 10% in principal amount of the Securities may petition at the expense of the Issuers any court of competent jurisdiction for the appointment of a successor Trustee or successor Collateral Agent.

(e) If the Trustee or Collateral Agent fails to comply with Section 7.10, unless the Trustee’s or Collateral Agent’s duty to resign is stayed as provided in Section 310(b) of the TIA, any Holder who has been a bona fide holder of a Security for at least six months may petition any court of competent jurisdiction for the removal of the Trustee or Collateral Agent and the appointment of a successor Trustee or successor Collateral Agent.

(f) Notwithstanding the replacement of the Trustee or Collateral Agent pursuant to this Section, the Issuers’ obligations under Section 7.07 shall continue for the benefit of the retiring Trustee or retiring Collateral Agent.

SECTION 7.09. Successor Trustee and Successor Collateral Agent by Merger. If the Trustee or Collateral Agent consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee or successor Collateral Agent.

In case at the time such successor or successors by merger, conversion or consolidation to the Trustee shall succeed to the trusts created by this Indenture any of the Securities shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Securities so authenticated; and in case at that time any of the Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor to the Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Securities or in this Indenture provided that the certificate of the Trustee shall have.

 

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SECTION 7.10. Eligibility; Disqualification. The Trustee and Collateral Agent shall at all times satisfy the requirements of Section 310(a) of the TIA. Each of the Trustee and the Collateral Agent shall have a combined capital and surplus of at least $100,000,000 as set forth in its most recent published annual report of condition. The Trustee and Collateral Agent shall comply with Section 310(b) of the TIA, subject to its right to apply for a stay of its duty to resign under the penultimate paragraph of Section 310(b) of the TIA; provided, however, that there shall be excluded from the operation of Section 310(b)(1) of the TIA any series of securities issued under this Indenture and any indenture or indentures under which other securities or certificates of interest or participation in other securities of the Issuers are outstanding if the requirements for such exclusion set forth in Section 310(b)(1) of the TIA are met.

SECTION 7.11. Preferential Collection of Claims Against Issuers. The Trustee or Collateral Agent shall comply with Section 311(a) of the TIA, excluding any creditor relationship listed in Section 311(b) of the TIA. A Trustee or Collateral Agent who has resigned or been removed shall be subject to Section 311(a) of the TIA to the extent indicated.

ARTICLE 8

DISCHARGE OF INDENTURE; DEFEASANCE

SECTION 8.01. Discharge of Liability on Securities; Defeasance. This Indenture shall be discharged and shall cease to be of further effect as to all outstanding Securities:

(a) when (i) all the Securities theretofore authenticated and delivered (other than Securities pursuant to Section 2.08 which have been replaced or paid and Securities for whose payment money has theretofore been deposited in trust or segregated and held in trust by an Issuer and thereafter repaid to an Issuer or discharged from such trust) have been delivered to the Trustee for cancellation or (ii) all of the Securities (a) have become due and payable, (b) will become due and payable at their stated maturity within one year or (c) if redeemable at the option of the Issuers, are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Issuers, and an Issuer or a Note Guarantor has irrevocably deposited or caused to be deposited with the Trustee funds in cash in U.S. Dollars, U.S. Government Obligations or a combination thereof in an amount sufficient to pay and discharge the entire Indebtedness on the Securities not theretofore delivered to the Trustee for cancellation, for principal of, premium, if any, and interest on the Securities to the date of redemption or maturity together with irrevocable instructions from the Issuers directing the Trustee to apply such funds to the payment thereof at maturity or redemption, as the case may be;

(b) the Issuers and/or the Note Guarantors have paid all other sums payable under this Indenture; and

(c) the Issuers have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel stating that all conditions precedent under this Indenture relating to the satisfaction and discharge of this Indenture have been complied with.

 

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The Collateral will be released from the lien securing the Securities as provided in this Indenture and the Collateral Documents upon a satisfaction and discharge in accordance with the provisions described above.

Subject to Sections 8.01(c) and 8.02, the Issuers at any time may terminate (i) all of their obligations and all obligations of the Note Guarantors under the Securities and this Indenture (with respect to such Securities) (“legal defeasance option”) or (ii) their obligations under Sections 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.10 and 4.11 and the operation of Section 5.01 and Sections 6.01(c), 6.01(d), 6.01(e) (with respect to any Default under Sections 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.10 and 4.11), 6.01(f), 6.01(g) (with respect to Significant Subsidiaries of Holdings only), 6.01(h) (with respect to Significant Subsidiaries of Holdings only), 6.01(i), 6.01(j) and 6.01(k) (“covenant defeasance option”). The Issuers may exercise its legal defeasance option notwithstanding its prior exercise of its covenant defeasance option. In the event that the Issuers terminate all of their obligations under the Securities and this Indenture (with respect to such Securities) by exercising its legal defeasance option or its covenant defeasance option, the obligations of each Note Guarantor under its Note Guarantee of such Securities shall be terminated simultaneously with the termination of such obligations.

If the Issuers exercise their legal defeasance option, payment of the Securities so defeased may not be accelerated because of an Event of Default. If the Issuers exercise their covenant defeasance option, payment of the Securities so defeased may not be accelerated because of an Event of Default specified in Section 6.01(c), 6.01(d), 6.01(e) (with respect to any Default by Holdings or any of its Restricted Subsidiaries with any of its obligations under Article IV other than Sections 4.01, 4.09. 4.12 and 4.13), 6.01(f), 6.01(g) (with respect to Significant Subsidiaries of Holdings only), 6.01(h) (with respect to Significant Subsidiaries of Holdings only), 6.01(i) (with respect to Significant Subsidiaries of Holdings only) or 6.01(j).

Upon satisfaction of the conditions set forth herein and upon request of the Issuers, the Trustee shall acknowledge in writing the discharge of those obligations that the Issuers terminate.

(d) Notwithstanding clause (a) above, the Issuers’ obligations in Sections 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 7.07, 7.08 and in this Article 8 shall survive until the Securities have been paid in full. Thereafter, the Issuers’ obligations in Sections 7.07, 8.05 and 8.06 shall survive such satisfaction and discharge.

SECTION 8.02. Conditions to Defeasance.

(a) The Issuers may exercise its legal defeasance option or their covenant defeasance option only if:

(i) the Issuers irrevocably deposit in trust with the Trustee cash in U.S. Dollars, U.S. Government Obligations or a combination thereof in an amount sufficient or U.S. Government Obligations, the principal of and the interest on which will be sufficient, or a combination thereof sufficient, to pay the principal of, and premium (if any) and interest on the applicable Securities when due at maturity or redemption, as the case may be;

 

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(ii) the Issuers deliver to the Trustee a certificate from a nationally recognized firm of independent accountants expressing their opinion that the payments of principal and interest when due and without reinvestment on the deposited U.S. Government Obligations plus any deposited money without investment will provide cash at such times and in such amounts as will be sufficient to pay principal, premium, if any, and interest when due on all the Securities to maturity or redemption, as the case may be;

(iii) 91 days pass after the deposit is made and during the 91-day period no Default specified in Section 6.01(g) or (h) with respect to the Issuers occurs which is continuing at the end of the period;

(iv) the deposit does not constitute a default under any other agreement binding on the Issuers;

(v) the Issuers deliver to the Trustee an opinion of counsel to the effect that the trust resulting from the deposit does not constitute, or is qualified as, a regulated investment company under the Investment Company Act of 1940;

(vi) in the case of the legal defeasance option, the Issuers shall have delivered to the Trustee an opinion of counsel stating that (1) the Issuers have received from, or there has been published by, the Internal Revenue Service a ruling, or (2) since the date of this Indenture there has been a change in the applicable Federal income tax law, in either case to the effect that, and based thereon such opinion of counsel shall confirm that, the Holders will not recognize income, gain or loss for Federal income tax purposes as a result of such deposit and defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred;

(vii) in the case of the covenant defeasance option, the Issuers shall have delivered to the Trustee an opinion of counsel to the effect that the Holders will not recognize income, gain or loss for Federal income tax purposes as a result of such deposit and defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred; and

(viii) the Issuers deliver to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent to the defeasance and discharge of the Securities to be so defeased and discharged as contemplated by this Article 8 have been complied with.

Notwithstanding the foregoing, the opinion of counsel required by the clause (vi) above need not be delivered if all Securities not theretofore delivered to the Trustee for cancellation (x) have become due and payable or (y) will become due and payable at their Stated Maturity within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Issuers.

 

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(b) Before or after a deposit, the Issuers may make arrangements satisfactory to the Trustee for the redemption of such Securities at a future date in accordance with Article 3.

SECTION 8.03. Application of Trust Money. The Trustee shall hold in trust money or U.S. Government Obligations (including proceeds thereof) deposited with it pursuant to this Article 8. It shall apply the deposited money and the money from U.S. Government Obligations through each Paying Agent and in accordance with this Indenture to the payment of principal of and interest on the Securities so discharged or defeased.

SECTION 8.04. Repayment to Issuers. Each of the Trustee and each Paying Agent shall promptly turn over to the Issuers upon request any money or U.S. Government Obligations held by it as provided in this Article 8 which, in the written opinion of a nationally recognized firm of independent public accountants delivered to the Trustee (which delivery shall only be required if U.S. Government Obligations have been so deposited), are in excess of the amount thereof which would then be required to be deposited to effect an equivalent discharge or defeasance in accordance with this Article 8.

Subject to any applicable abandoned property law, the Trustee and each Paying Agent shall pay to the Issuers upon written request any money held by them for the payment of principal or interest that remains unclaimed for two years, and, thereafter, Holders entitled to the money must look to the Issuers for payment as general creditors, and the Trustee and each Paying Agent shall have no further liability with respect to such monies.

SECTION 8.05. Indemnity for U.S. Government Obligations. The Issuers shall pay and shall indemnify the Trustee against any tax, fee or other charge imposed on or assessed against deposited U.S. Government Obligations or the principal and interest received on such U.S. Government Obligations.

SECTION 8.06. Reinstatement. If the Trustee or any Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with this Article 8 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Issuers’ obligations under this Indenture and the Securities so discharged or defeased shall be revived and reinstated as though no deposit had occurred pursuant to this Article 8 until such time as the Trustee or any Paying Agent is permitted to apply all such money or U.S. Government Obligations in accordance with this Article 8; provided, however, that, if the Issuers have made any payment of principal of or interest on, any such Securities because of the reinstatement of its obligations, the Issuers shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money or U.S. Government Obligations held by the Trustee or any Paying Agent.

ARTICLE 9

AMENDMENT, SUPPLEMENT AND WAIVER

SECTION 9.01. Without Consent of the Holders.

 

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(a) The Issuers and the Trustee may amend this Indenture, the Securities, the Note Guarantees, any Collateral Document or the Second Lien Intercreditor Agreement without notice to or consent of any Holder:

(i) to cure any ambiguity, omission, mistake, defect or inconsistency;

(ii) to conform the text of this Indenture, the Note Guarantees or the Securities to any provision under the heading “Description of Notes” in the Offering Memorandum to the extent that such provision was intended to be a verbatim recitation of a provision of this Indenture, the Note Guarantees or the Securities as certified by the Issuers in an Officer’s Certificate;

(iii) to provide for the assumption by a Successor Company of the obligations of the Issuer under this Indenture and the Securities;

(iv) to provide for uncertificated Securities in addition to or in place of certificated Securities; provided, however, that the uncertificated Securities are issued in registered form for purposes of Section 163(f) of the Code or in a manner such that the uncertificated Securities are described in Section 163(f)(2)(B) of the Code;

(v) to add or release a Note Guarantee with respect to the Securities in accordance with the terms of this Indenture;

(vi) to add additional assets as Collateral, to release Collateral from the Lien pursuant to this Indenture, the Collateral Documents and the Second Lien Intercreditor Agreement when permitted or required by this Indenture, the Collateral Documents and the Second Lien Intercreditor Agreement;

(vii) to modify the Collateral Documents and/or the Second Lien Intercreditor Agreement to secure additional extensions of credit and add additional secured creditors holding other Second Lien Obligations or junior lien Obligations of the Issuers or any Note Guarantor so long as such other Second Lien Obligations or junior lien Obligations are not prohibited by the provisions of the Credit Agreement, this Indenture and any other relevant agreement;

(viii) to add to the covenants of Holdings for the benefit of the Holders or to surrender any right or power herein conferred upon Holdings;

(ix) to comply with any requirement of the SEC in connection with qualifying or maintaining the qualification of, this Indenture under the TIA;

(x) to effect any provision of this Indenture;

(xi) to make any change that does not adversely affect the rights of any Holder or that would provide any additional rights or benefits to the Holders;

 

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(xii) to provide for the issuance of the Exchange Securities or Additional Securities (and the grant of security for the benefit of the Additional Securities), which shall have terms substantially identical in all material respects to the Initial Securities, and which shall be treated, together with any outstanding Initial Securities, as a single issue of securities;

(xiii) to evidence and provide for the acceptance of appointment by a successor trustee, provided that the successor trustee is otherwise qualified and eligible to act as such under the terms of this Indenture, or evidence and provide for a successor or replacement Collateral Agent under this Indenture and Collateral Documents;

(xiv) to make, complete or confirm any grant of Collateral permitted or required by this Indenture or any of the Collateral Documents or any release, termination or discharge of Collateral that becomes effective as set forth in this Indenture or any of the Collateral Documents; mortgage, pledge, hypothecate or grant a security interest in favor of the Collateral Agent for the benefit of the Trustee and the Holders of the Securities as additional security for the payment and performance of the Issuer’s and any Note Guarantor’s obligations under this Indenture, in any property, or assets, including any of which are required to be mortgaged, pledged or hypothecated, or in which a security interest is required to be granted to the Trustee or the Collateral Agent in accordance with the terms of this Indenture or otherwise;

(xv) to provide for the succession of any parties to the Indenture and Collateral Documents (and other amendments that are administrative or ministerial in nature), including, the replacement of the Collateral Agent under the Second Lien Intercreditor Agreement, in connection with any incurrence of additional secured obligations or an amendment, renewal, extension, substitution, refinancing, restructuring, replacement, supplementing or other modification from time to time of any agreement in accordance with the terms of this Indenture and the relevant collateral document;

(xvi) to provide for a reduction in the minimum denominations of the Securities;

(xvii) to make any amendment to the provisions of this Indenture relating to the transfer and legending of Securities as permitted hereunder, including, without limitation, to facilitate the issuance and administration of the Securities, provided that compliance with this Indenture as so amended may not result in Securities being transferred in violation of the Securities Act or any applicable securities laws;

(xviii) to provide for the assumption by one or more successors of the obligations of any of the Note Guarantors under this Indenture and the Note Guarantees; or

(xix) to comply with the rules of any applicable securities depositary.

Upon the request of the Issuers accompanied by a resolution of the Board of Directors of the Issuers authorizing the execution of any supplemental indenture entered into to effect any such amendment, supplement or waiver, and upon receipt by the Trustee of the

 

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documents described in Section 9.06, the Trustee shall join with the Issuers in the execution of such supplemental indenture.

(b) Without the consent of the Holders of at least two-thirds in aggregate principal amount of Securities then outstanding, no amendment or waiver:

(i) may release all or substantially all of the Collateral from the Lien of this Indenture and the Collateral Documents with respect to the Securities; or

(ii) make any change in the provisions of the Second Lien Intercreditor Agreement or this Indenture dealing with the application of proceeds of Collateral that would adversely affect Holders of the Securities.

SECTION 9.02. With Consent of the Holders.

(a) Except as provided in 9.01(b), the Issuers and the Trustee may amend this Indenture, the Securities, the Note Guarantees, the Collateral Documents and the Second Lien Intercreditor Agreement with the written consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding voting as a single class (including, without limitation, consents obtained in connection with a purchase of, tender offer or exchange offer for the Securities). However, without the consent of each Holder of an outstanding Security affected, an amendment may not (with respect to any Security held by a non-consenting holder):

(i) reduce the percentage of aggregate principal amount of Securities whose Holders must consent to an amendment;

(ii) reduce the rate of or extend the time for payment of interest on any Security;

(iii) reduce the principal of or change the Stated Maturity of any Security;

(iv) reduce the premium payable upon the redemption of any Security or change the time at which any Security may be redeemed in accordance with Article 3;

(v) make any Security payable in money other than that stated in such Security;

(vi) impair the right of any Holder to receive payment of principal of, premium, if any, and interest on such Holder’s Securities on or after the date due or to institute suit for the enforcement of any payment on or with respect to such Holder’s Securities;

(vii) make any change in Section 6.04 or 6.07 or the second sentence of this Section 9.02(a);

(viii) expressly subordinate the Securities or any Note Guarantee or otherwise modify the ranking thereof to any other Indebtedness of the Issuers or any Note Guarantor; or

 

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(ix) modify the Note Guarantees in any manner adverse to the Holders other than as contemplated in Section 11.02(c) hereof..

It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent approves the substance thereof.

Upon the request of the Issuers accompanied by a resolution of the Board of Directors of the Issuers authorizing the execution of any supplemental indenture entered into to effect any such amendment, supplement or waiver, and upon receipt by the Trustee of the documents described in Section 9.06, the Trustee, subject to its rights in Section 9.06, shall join with the Issuers in the execution of such supplemental indenture.

SECTION 9.03. Compliance with Trust Indenture Act. From the date on which this Indenture is qualified under the TIA, every amendment, waiver or supplement to this Indenture or the Securities shall comply with the TIA as then in effect.

SECTION 9.04. Revocation and Effect of Consents and Waivers.

(a) A consent to an amendment or a waiver by a Holder of a Security shall bind the Holder and every subsequent Holder of that Security or portion of the Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent or waiver is not made on the Security. However, any such Holder or subsequent Holder may revoke the consent or waiver as to such Holder’s Security or portion of the Security if the Trustee receives the notice of revocation before the date on which the Trustee receives an Officer’s Certificate from the Issuers certifying that the requisite principal amount of Securities have consented. After an amendment or waiver becomes effective, it shall bind every Holder. An amendment or waiver becomes effective upon the (i) receipt by the Issuers or the Trustee of consents by the Holders of the requisite principal amount of securities, (ii) satisfaction of conditions to effectiveness as set forth in this Indenture and any indenture supplemental hereto containing such amendment or waiver and (iii) execution of such amendment or waiver (or supplemental indenture) by the Issuers and the Trustee.

(b) The Issuers may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to give their consent or take any other action described above or required or permitted to be taken pursuant to this Indenture. If a record date is fixed, then notwithstanding the immediately preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to give such consent or to revoke any consent previously given or to take any such action, whether or not such Persons continue to be Holders after such record date. No such consent shall be valid or effective for more than 120 days after such record date.

SECTION 9.05. Notation on or Exchange of Securities. If an amendment, supplement or waiver changes the terms of a Security, the Issuers may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security regarding the changed terms and return it to the Holder. Alternatively, if the Issuers or the Trustee so determine, the Issuers in exchange for the Security shall issue and upon receipt of an

 

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Authentication Order the Trustee shall authenticate a new Security that reflects the changed terms. Failure to make the appropriate notation or to issue a new Security shall not affect the validity of such amendment, supplement or waiver.

SECTION 9.06. Trustee to Sign Amendments. The Trustee shall sign any amendment, supplement or waiver authorized pursuant to this Article 9 if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may but need not sign it. In signing such amendment, the Trustee shall be entitled to receive indemnity reasonably satisfactory to it and shall be provided with, and (subject to Section 7.01) shall be fully protected in relying upon, an Officer’s Certificate stating that such amendment, supplement or waiver is authorized or permitted by this Indenture and an Opinion of Counsel stating that such amendment, supplement or waiver is authorized or permitted by this Indenture and is the legal, valid and binding obligation of the Issuers and any new Note Guarantor thereto pursuant to Section 11.06, enforceable against them in accordance with its terms, subject to customary exceptions, and complies with the provisions hereof (including Section 9.03).

SECTION 9.07. Payment for Consent. Neither the Issuers nor any Affiliate of the Issuers shall, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or otherwise, to any Holder for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Securities unless such consideration is offered to be paid to all Holders that so consent, waive or agree to amend in the time frame set forth in solicitation documents relating to such consent, waiver or agreement.

SECTION 9.08. Additional Voting Terms. All Securities issued under this Indenture shall vote and consent together on all matters (as to which any of such Securities may vote) as one class and no series of Securities will have the right to vote or consent as a separate class on any matter.

ARTICLE 10

COLLATERAL

SECTION 10.01. Collateral Documents.

The Issuers hereby appoint Wilmington Trust FSB to act as Collateral Agent, and each Holder by its acceptance of any Securities, irrevocably consents and agrees to such appointment. The payment of the principal of and interest and premium, if any, on the Securities when due, whether on an interest payment date, at maturity, by acceleration, repurchase, redemption or otherwise and whether by the Issuers pursuant to the Securities or by any Note Guarantor pursuant to its Note Guarantee, the payment of all other Obligations under this Indenture, the Securities and the Collateral Documents and the performance of all other obligations of the Issuers and the Note Guarantors under this Indenture, the Securities, the Note Guarantees and the Collateral Documents are secured as provided in the Collateral Documents and will be secured by Collateral Documents hereafter delivered as required or permitted by this Indenture. The Issuers shall, and shall cause each Note Guarantor to, and each Note Guarantor shall, do all filings (including filings of continuation statements and amendments to Uniform Commercial Code financing statements that may be necessary to continue the effectiveness of such Uniform Commercial

 

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Code financing statements) and all other actions as are necessary or required by the Collateral Documents to maintain (at the sole cost and expense of the Issuer and the Note Guarantors) the security interest created by the Collateral Documents in the Collateral as a perfected security interest, subject only to Permitted Liens.

The Issuer will otherwise comply with the provisions of Section 314(b) of the TIA. Promptly after the effectiveness of this Indenture, to the extent required by the TIA, the Issuer shall deliver the opinion(s) required by Section 314(b)(1) of the TIA. Subsequent to the execution and delivery of this Indenture, to the extent required by the TIA, the Issuer shall furnish to the Trustee on or prior to each anniversary of the Issue Date, an Opinion of Counsel, dated as of such date, stating either that (i) in the opinion of such counsel, all action has been taken with respect to any filing, re-filing, recording or re-recording with respect to the Collateral as is necessary to maintain the Lien on the Collateral in favor of the Holders or (ii) in the opinion of such counsel, that no such action is necessary to maintain such Lien.

SECTION 10.02. Collateral Agent.

(a) The Collateral Agent is authorized and empowered to appoint one or more co-Collateral Agents as it deems necessary or appropriate.

(b) The Collateral Agent shall have all the rights and protections provided in the Collateral Documents as well as the rights and protections afforded to the Trustee in Sections 7.02 and 7.07 hereof; provided, however, the Issuers shall not reimburse any expense or indemnify against any loss, liability, or expense incurred by the Collateral Agent through the Collateral Agent’s own willful misconduct, gross negligence or bad faith.

(c) Subject to Section 7.01 hereof, none of the Trustee, the Collateral Agent, Paying Agent and Registrar nor any of their respective officers, directors, employees, attorneys or agents will be responsible or liable for the existence, genuineness, value or protection of any Collateral, for the legality, enforceability, effectiveness or sufficiency of the Collateral Documents, for the creation, perfection, priority, sufficiency or protection of any Lien securing the Securities, or any defect or deficiency as to any such matters.

(d) Subject to the Collateral Documents, the Trustee shall direct the Collateral Agent from time to time. Subject to the Collateral Documents, except as directed by the Trustee as required or permitted by this Indenture and any other representatives, the Holders acknowledge that the Collateral Agent will not be obligated:

(i) to act upon directions purported to be delivered to it by any other Person;

(ii) to foreclose upon or otherwise enforce any Lien securing the Securities; or

(iii) to take any other action whatsoever with regard to any or all of Liens securing the Securities, Collateral Documents or Collateral.

 

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(e) In acting as Collateral Agent or co-Collateral Agent, the Collateral Agent and each co-Collateral Agent may rely upon and enforce each and all of the rights, powers, immunities, indemnities and benefits of the Trustee under Article 7 hereof.

SECTION 10.03. Authorization of Actions to be Taken.

(a) Each Holder of Securities, by its acceptance thereof, consents and agrees to the terms of each Collateral Document, as originally in effect and as amended, supplemented or replaced from time to time in accordance with its terms or the terms of this Indenture, authorizes and directs the Trustee and the Collateral Agent to enter into the Collateral Documents to which it is a party, authorizes and empowers the Trustee and the Collateral Agent to execute and deliver the Second Lien Intercreditor Agreement.

(b) The Trustee is authorized and empowered to receive for the benefit of the Holders of Securities any funds collected or distributed to the Trustee or the Collateral Agent under the Collateral Documents to which the Trustee or the Collateral Agent is a party and, subject to the terms of the Collateral Documents, to make further distributions of such funds to the Holders of Securities according to the provisions of this Indenture.

(c) Subject to the provisions of Section 7.01, Section 7.02, and the Collateral Documents, the Trustee may, in its sole discretion and without the consent of the Holders, direct, on behalf of the Holders, the Collateral Agent to take all actions it deems necessary or appropriate in order to:

(i) foreclose upon or otherwise enforce any or all of the first priority Liens securing the Securities;

(ii) enforce any of the terms of the Collateral Documents to which the Collateral Agent or Trustee is a party; or

(iii) collect and receive payment of any and all Obligations.

(d) Subject to the Second Lien Intercreditor Agreement, at the Issuers’ sole cost and expense, the Trustee is authorized and empowered to institute and maintain, or direct the Collateral Agent to institute and maintain, such suits and proceedings as it may deem reasonably expedient to protect or enforce the first priority Liens securing the Securities or the Collateral Documents to which the Collateral Agent or Trustee is a party or to prevent any impairment of Collateral by any acts that may be unlawful or in violation of the Collateral Documents or this Indenture, and such suits and proceedings as the Trustee may deem reasonably expedient, at the Issuers’ sole cost and expense, to preserve or protect its interests and the interests of the Holders of Securities in the Collateral, including power to institute and maintain suits or proceedings to restrain the enforcement of or compliance with any legislative or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid if the enforcement of, or compliance with, such enactment, rule or order would impair the security interest hereunder or be prejudicial to the interests of Holders or the Trustee.

SECTION 10.04. Release of Collateral.

 

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(a) Collateral may be released from the Lien and security interest created by the Collateral Documents at any time or from time to time in accordance with the provisions of the Collateral Documents and/or the Second Lien Intercreditor Agreement. In addition, upon the request of the Issuer pursuant to an Officer’s Certificate and Opinion of Counsel certifying that all conditions precedent hereunder have been met, the Issuers and the Note Guarantors will be entitled to the release of assets included in the Collateral from the Liens securing the Securities, and the Collateral Agent and the Trustee (if the Trustee is not then the Collateral Agent) shall release the same from such Liens at the Issuers’ sole cost and expense, under any one or more of the following circumstances:

(i) to enable the Issuers to consummate the sale, transfer or other disposition of such property or assets to a Person that is not an Issuer or a Note Guarantor to the extent not prohibited under Section 4.06 hereof;

(ii) in the case of a Note Guarantor that is released from its Note Guarantee with respect to the Securities, the release of the propoerty and assets of such Note Guarantor; or

(iii) as permitted under Article 9 hereof.

(b) For the avoidance of doubt, the Lien on the Collateral created by the Collateral Documents securing the Second Lien Obligations shall automatically be released and discharged under the circumstances set forth in, and subject to, Section 5.01 of the Second Lien Intercreditor Agreement.

(c) To the extent necessary and for so long as required for such Subsidiary not to be subject to any requirement pursuant to Rule 3-16 of Regulation S-X under the Securities Act to file separate financial statements with the SEC (or any other governmental agency), the Capital Stock of any Subsidiary of Holdings shall not be included in the Collateral with respect to the Securities and shall not be subject to the Liens securing the Securities and the Second Lien Obligations in accordance with and only to the extent provided in Section 2.01 of the Security Agreement.

(d) The Liens on the Collateral securing the Securities and the Note Guarantees also will be released automatically upon (i) payment in full of the principal of, together with accrued and unpaid interest on, and premium, if any, on, the Securities and all other Obligations under this Indenture, the Note Guarantees and the Collateral Documents that are due and payable at or prior to the time such principal, together with accrued and unpaid interest, are paid or (ii) a legal defeasance or covenant defeasance or a discharge under Article 8 hereof.

(e) Any release of Collateral permitted by this Section 10.04 hereof will be deemed not to impair the Liens under this Indenture and the Collateral Documents in contravention thereof

SECTION 10.05. Powers Exercisable by Receiver or Trustee.

 

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In case the Collateral shall be in the possession of a receiver or trustee, lawfully appointed, the powers conferred in this Article 10 upon the Issuer or a Note Guarantor with respect to the release, sale or other disposition of such property may be exercised by such receiver or trustee, and an instrument signed by such receiver or trustee shall be deemed the equivalent of any similar instrument of the Issuer or a Note Guarantor or of any officer or officers thereof required by the provisions of this Article 10; and if the Trustee or the Collateral Agent shall be in the possession of the Collateral under any provision of this Indenture, then such powers may be exercised by the Trustee or the Collateral Agent, as the case may be.

SECTION 10.06. Release upon Termination of the Issuer’s Obligations.

In the event (i) that the Issuers deliver to the Trustee, in form and substance acceptable to it, an Officer’s Certificate and Opinion of Counsel certifying that all the Obligations under this Indenture, the Securities and the Collateral Documents have been satisfied and discharged by the payment in full of the Issuers’ obligations under the Securities, this Indenture and the Collateral Documents, and all such Obligations have been so satisfied, or (ii) a discharge, legal defeasance or covenant defeasance of this Indenture occurs under Article 8, the Trustee shall deliver to the Issuers and the Collateral Agent a notice stating that the Trustee, on behalf of the Holders, disclaims and gives up any and all rights it has in or to the Collateral, and any rights it has under the Collateral Documents, and upon receipt by the Collateral Agent of such notice, the Collateral Agent shall be deemed not to hold a Lien in the Collateral on behalf of the Trustee, and the Trustee shall (and direct the Collateral Agent to) do or cause to be done, at the Issuers’ sole cost and expense, all acts reasonably necessary to release such Lien as soon as is reasonably practicable.

SECTION 10.07. Designations.

For purposes of the provisions hereof and the Second Lien Intercreditor Agreement requiring the Issuers to designate Indebtedness for the purposes of the term Second Lien Obligations or any other such designations hereunder or under the Second Lien Intercreditor Agreement, any such designation shall be sufficient if the relevant designation provides in writing that such Second Lien Obligations are permitted under this Indenture and is signed on behalf of the Issuers by an Officer and delivered to the Trustee, the Collateral Agent and the Credit Agreement Collateral Agent

SECTION 10.08. Post-Closing Collateral.

(a) Personal Properties. On or prior to the Post-Closing Collateral Date and at all times thereafter the Securities shall have been secured by a second priority security interest (to the extent such concept is relevant in the applicable jurisdiction) in all Equity Interests (except to the extent such Equity Interests constitute Excluded Assets) of each Restricted Subsidiary of Holdings existing as of the Issue Date that is directly owned by any Guarantor and also a guarantor under the Credit Agreement, subject to exceptions and limitations otherwise set forth in the Indenture and the Collateral Documents (to the extent appropriate in the applicable jurisdiction) or otherwise satisfactory to the Credit Agreement Collateral Agent.

 

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(b) Guarantors. Subject to Section 11.02(c), on or prior to the Post-Closing Collateral Date, each Restricted Subsidiary of Holdings existing as of the Issue Date that is or becomes a guarantor under the Credit Agreement other than any entity that would trigger a Rule 3-10 Limitation as reasonably determined by Holdings, shall become a Guarantor and signatory to the Purchase Agreement pursuant to the joinder agreement (attached as an exhibit thereto with appropriate changes to the extent contemplated by Section 11.02(c)) and a party to the Registration Rights Agreement, the applicable Collateral Documents and the Indenture, subject to exceptions and limitations otherwise set forth in the Indenture and the Collateral Documents (to the extent appropriate in the applicable jurisdiction) or satisfactory to the Credit Agreement Collateral Agent and shall have taken all actions to perfect (or the equivalent in the applicable jurisdiction) the Liens in the Collateral created by the Collateral Documents to which it is a party, other than any actions that are not required by such Collateral Documents or by the Credit Agreement Collateral Agent.

(c) Mortgaged Properties. With respect to each Mortgaged Property existing as of the Issue Date that is required by the Credit Agreement Collateral Agent to be mortgaged, the Issuers and the Guarantors shall deliver to the Collateral Agent on or prior to the Post-Closing Collateral Date, the following documents, in each case in form substantially similar to that accepted by the Credit Agreement Collateral Agent:

(i) to the extent customary and appropriate as determined by the Issuers or the Credit Agreement Collateral Agent, filed a Mortgage with respect to such Mortgaged Property duly executed and delivered by the record owner of such property recorded in the appropriate filing or recording offices creating a valid and subsisting perfected second-priority (to the extent applicable in the relevant jurisdiction) Lien (subject only to Permitted Liens) on the property and/or rights described therein in favor of the Collateral Agent for its benefit and the benefit of the Trustee and the Holders of the Securities, and evidence that all filing and recording taxes and fees, if any, have been paid or otherwise provided for (it being understood that if a mortgage tax will be owed on the entire amount of the indebtedness evidenced hereby, then the amount secured by the Mortgage shall be limited to 100% of the fair market value of the property at the time the Mortgage is entered into if such limitation results in such mortgage tax being calculated based upon such fair market value);

(ii) in the case of any such Mortgaged Property located in the United States or to the extent customary as determined by the Credit Agreement Collateral Agent, if any, or the Issuers in the jurisdiction of where such Mortgaged Property is located, fully paid policies of title insurance (or marked-up title insurance commitments having the effect of policies of title insurance) on the Mortgaged Property naming the Collateral Agent as the insured for its benefit and the benefit of the Trustee and the Holders of the Securities (the “Mortgage Policies”) issued by a nationally recognized title insurance company in a customary amount (not to exceed 100% of the fair market value of the real properties covered thereby), insuring the Mortgages to be valid subsisting second-priority Liens on the property described therein, free and clear of all Liens other than Permitted Liens, each of which shall (A) to the extent reasonably necessary, include such reinsurance arrangements (with provisions for direct access, if reasonably necessary), (B) contain a “tie-in”

 

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or “cluster” endorsement, if available under applicable law (i.e., policies which insure against losses regardless of location or allocated value of the insured property up to a stated maximum coverage amount) and (C) have been supplemented by such endorsements (or where such endorsements are not available, opinions of special counsel, architects or other professionals) including endorsements on matters relating to usury, first loss, last dollar, zoning, contiguity, revolving credit (if available after the Issuers use commercially reasonable efforts), doing business, non-imputation, public road access, survey, variable rate, environmental lien, subdivision, mortgage recording tax, address, separate tax lot and so-called comprehensive coverage over covenants and restrictions; provided, however, the Issuers and Guarantors shall not be obligated to obtain a “creditor’s rights” endorsement;

(iii) legal opinions, addressed to the Trustee, the Collateral Agent, the Initial Purchasers and the Holders of the Securities, as to customary perfection and enforceability matters as determined by the Credit Agreement Collateral Agent, if any, or the Issuers;

(iv) in the case of any such Mortgaged Property located in the United States or to the extent customary as determined by the Credit Agreement Collateral Agent, if any, or the Issuers in the jurisdiction of where such Mortgaged Property is located, a survey or express map of each Mortgaged Property certified to the Collateral Agent for its benefit and for the benefit of the Trustee and Holders of the Securities sufficient in form to delete the standard survey exception in the Mortgage Policies and provide the Collateral Agent with endorsements to such policy;

(v) in the case of any such Mortgaged Property located in the United States, a completed “life of loan” Federal Emergency Management Agency Standard Flood Hazard Determination with respect to each Mortgaged Property (together with a notice about special flood hazard area status and flood disaster assistance duly executed by the Issuers and each Guarantor relating thereto); and

(vi) in the case of any such Mortgaged Property located in the United States or to the extent customary in the jurisdiction of where such Mortgaged Property is located, a copy of a certificate as determined by the Credit Agreement Collateral Agent, if any, or the Issuers as to coverage under the insurance policies required by this Indenture and the Second Lien Collateral Documents including, without limitation, flood insurance policies, each of which shall be endorsed or otherwise amended to include a “Standard” or “New York” lender’s loss payable or mortgage endorsement (as applicable) and shall name the Collateral Agent, for its benefit and the benefit of the Trustee and the Holders of the Securities, as additional insured.

(d) Subject to Sections 4.10 and 4.16 (in the case of clause (a) below) and the foregoing provisions of this Section 10.08, from and after the Issue Date, (a) if the Issuers or any Note Guarantor creates any additional security interest upon any property or asset that would constitute Collateral to secure any Senior Obligations (as defined in the Intercreditor Agreement), it shall concurrently grant a second-priority (to the extent such concept is relevant in the applicable jurisdication) perfected security interest (subject to Permitted Liens) upon such property as security for the Securities and (b) if the Issuer or any Note Guarantor creates any

 

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additional security interest upon any property or asset that would constitute Collateral to secure any Additional Second Lien Obligations, it shall concurrently grant a pari passu (to the extent such concept is relevant in the applicable jurisidiction) perfected security interest (subject to Permitted Liens) upon such property as security for the Securities.

SECTION 10.09. Parallel Debt.

(a) Without prejudice to the provisions of this Indenture and the Collateral Documents and for the purpose of preserving the initial and continuing validity of the security rights granted and to be granted by each Issuer and each Note Guarantor to the Collateral Agent (or any sub-agent thereof), an amount equal to and in the same currency of the obligations under the Securities and the Note Guarantees from time to time due by the Issuers or such Note Guarantor in accordance with the terms and conditions of the Securities and Note Guarantees, including for the avoidance of doubt, the limitations set out under Section 10.04, shall be owing as separate and independent obligations of each Issuer and each Note Guarantor to each of (i) the Collateral Agent (such payment undertaking and the obligations and liabilities which are the result thereof, the “Collateral Agent Parallel Debt”) and (ii) any sub-agent of the Collateral Agent (such payment undertaking and the obligations and liabilities which are the result thereof, the “Sub-Agent Parallel Debt” and, together with the Collateral Agent Parallel Debt, the “Parallel Debt”). Solely for the purposes of the Collateral Documents governed by Russian law, the Collateral Agent acts as a joint and several creditor with each Secured Party.

(b) Each Issuer, each Note Guarantor and the Collateral Agent (and any sub-agent thereof) acknowledge that (i) for this purpose the Collateral Agent Parallel Debt constitutes undertakings, obligations and liabilities of the Issuers and each Note Guarantor to the Collateral Agent under this Indenture and the Collateral Documents which are separate and independent from, and without prejudice to, the corresponding obligations under the Securities and Note Guarantees which each Issuer or such Note Guarantor has to the Holders or any obligations with respect to the Sub-Agent Parallel Debt; (ii) for this purpose the Sub-Agent Parallel Debt constitutes undertakings, obligations and liabilities of each Issuer and each Note Guarantor to each sub-agent, if any, of the Collateral Agent under the Securities and Note Guarantees which are separate and independent from, and without prejudice to, the corresponding obligations under the Securities and Note Guarantees which each Issuer or such Note Guarantor has to the Holders or any obligations with respect to the Collateral Agent Parallel Debt; (iii) that the Collateral Agent Parallel Debt represents the Collateral Agent’s own claims to receive payment of the Collateral Agent Parallel Debt; and (iv) that the Sub-Agent Parallel Debt represents the applicable sub-agents’ own claims to receive payment of the Sub-Agent Parallel Debt; provided that the total amount which may become due under each of the Collateral Agent Parallel Debt or Sub-Agent Parallel Debt shall never exceed the total amount which may become due under the Securities and Note Guarantees; provided, further, that the Collateral Agent or any sub-agent thereof shall exercise its rights with respect to the applicable Parallel Debt solely in accordance with this Indenture and the Collateral Documents (including the Second Lien Intercreditor Agreement).

(c) Every payment of monies made by an Issuer or a Note Guarantor to the Collateral Agent or any sub-agent thereof shall (conditionally upon such payment not subsequently being avoided or reduced by virtue of any provisions or enactments relating to

 

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bankruptcy, insolvency, liquidation or similar laws of general application) be in satisfaction pro tanto of the covenant by the Issuers or such Note Guarantor contained in Section 10.09(a); provided that if any such payment as is mentioned above is subsequently avoided or reduced by virtue of any provisions or enactments relating to bankruptcy, liquidation or similar laws of general application the Collateral Agent and any sub-agent thereof shall be entitled to receive the amount of such payment from the Issuers or such Note Guarantor and the Issuers or such Note Guarantor shall remain liable to perform the relevant obligation and the relevant liability shall be deemed not to have been discharged.

(d) Subject to the provision in paragraph (c) of this Section 10.09, but notwithstanding any of the other provisions of this paragraph (d):

(i) the total amount due and payable as Collateral Agent Parallel Debt and Sub-Agent Parallel Debt under this Section 10.09 shall each be decreased to the extent that an Issuer or a Note Guarantor shall have paid any amounts to the Collateral Agent (or any sub-agent thereof) or to the Trustee on behalf of the Holders or any of them to reduce the outstanding principal amount of the Securities or the Collateral Agent (or any sub-agent thereof) or the Trustee on behalf of the Holders otherwise receives any amount in payment of the Securities and the Note Guarantees; and

(ii) to the extent that (x) an Issuer or a Note Guarantor shall have paid any amounts to the Trustee or to the Collateral Agent under the Collateral Agent Parallel Debt, to any sub-agent of the Collateral Agent under the Sub-Agent Parallel Debt or the Trustee or (y) the Collateral Agent or any sub-agent thereof shall have otherwise received monies in payment of the Parallel Debt owed to it, the total amount due and payable under the Securities and the Note Guarantees shall be decreased as if said amounts were received directly in payment of the Securities and Note Guarantees.

(e) In the event of a resignation of the Collateral Agent or any of its sub-agents or the appointment of a new Collateral Agent or sub-agent pursuant to Section 7.08 of this Indenture, the retiring Collateral Agent or sub-agent shall at the Grantors’ sole cost and expense (including legal fees) (i) assign the Parallel Debt owed to it (but not by way of novation) and (ii) transfer any Collateral granted to it securing such Parallel Debt, in each case to the successor Collateral Agent or sub-agent, as applicable.

ARTICLE 11

NOTE GUARANTEES

SECTION 11.01. Note Guarantees.

(a) As promptly as practicable and in any event within 60 days of the Issue Date (the “60 Day Post-Closing Period”), Holdings and each of its Restricted Subsidiaries (other than the Issuers) that are borrowers or guarantors under the Credit Agreement, excluding certain entities that would trigger a Rule 3-10 release as reasonably determined by Holdings, will jointly and severally irrevocably and unconditionally guarantee, as a guarantor and not as a surety, the performance and punctual payment when due, whether at Stated Maturity, by acceleration or

 

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otherwise, of all obligations of the Issuers under this Indenture and the Securities, whether for payment of principal of, premium, if any, or interest or additional interest on the Securities, expenses, indemnification or otherwise (all such obligations guaranteed by such Note Guarantors being herein called the “Guaranteed Obligations”). Each Note Guarantor further agrees that the Guaranteed Obligations may be extended or renewed, in whole or in part, without notice or further assent from each such Note Guarantor, and that each such Note Guarantor shall remain bound under this Article 11 notwithstanding any extension or renewal of any Guaranteed Obligation.

(b) Each Note Guarantor waives presentation to, demand of payment from and protest to the Issuers of any of the Guaranteed Obligations and also waives notice of protest for nonpayment. Each Note Guarantor waives notice of any default under the Securities or the Guaranteed Obligations. The obligations of each Note Guarantor hereunder shall not be affected by (i) the failure of any Holder or the Trustee to assert any claim or demand or to enforce any right or remedy against the Issuers or any other Person under this Indenture, the Securities or any other agreement or otherwise; (ii) any extension or renewal of this Indenture, the Securities or any other agreement; (iii) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Securities or any other agreement; (iv) the release of any security, if any, held by any Holder or the Trustee for the Guaranteed Obligations or any Note Guarantor; (v) the failure of any Holder or Trustee to exercise any right or remedy against any other guarantor of the Guaranteed Obligations; or (vi) any change in the ownership of such Note Guarantor, except as provided in Section 11.02(b).

(c) Except as otherwise provided herein, each Note Guarantor hereby waives any right to which it may be entitled to have its obligations hereunder divided among the Note Guarantors, such that such Note Guarantor’s obligations would be less than the full amount claimed. Each Note Guarantor hereby waives any right to which it may be entitled to have the assets of the Issuers first be used and depleted as payment of the Issuers’ or such Note Guarantor’s obligations hereunder prior to any amounts being claimed from or paid by such Note Guarantor hereunder. Each Note Guarantor hereby waives any right to which it may be entitled to require that the Issuers be sued prior to an action being initiated against such Note Guarantor.

(d) Each Note Guarantor further agrees that its Note Guarantee herein constitutes a guarantee of payment, performance and compliance when due (and not a guarantee of collection) and waives any right to require that any resort be had by any Holder or the Trustee to any security held for payment of the Guaranteed Obligations.

(e) Except as expressly set forth in Sections 8.01 and 11.02, the obligations of each Note Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guaranteed Obligations or otherwise. Without limiting the generality of the foregoing, the obligations of each Note Guarantor herein shall not be discharged or impaired or otherwise affected by the failure of any Holder or the Trustee to assert any claim or demand or to enforce any remedy under this Indenture, the Securities or any other agreement, by any waiver or modification of any

 

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thereof, by any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of any Note Guarantor or would otherwise operate as a discharge of any Note Guarantor as a matter of law or equity.

(f) Except as set forth in Sections 8.01 and 11.02, each Note Guarantor agrees that its Note Guarantee shall remain in full force and effect until payment in full of all the Guaranteed Obligations. Except as set forth in Sections 8.01 and 11.02, each Note Guarantor further agrees that its Note Guarantee herein shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal of or interest on any Guaranteed Obligation is rescinded or must otherwise be restored by any Holder or the Trustee upon the bankruptcy or reorganization of the Issuers or otherwise.

(g) In furtherance of the foregoing and not in limitation of any other right which any Holder or the Trustee has at law or in equity against any Note Guarantor by virtue hereof, upon the failure of the Issuers to pay the principal of or interest on any Guaranteed Obligation when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, or to perform or comply with any other Guaranteed Obligation, each Note Guarantor hereby promises to and shall, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Trustee an amount equal to the sum of (i) the unpaid principal amount of such Guaranteed Obligations, (ii) accrued and unpaid interest on such Guaranteed Obligations (but only to the extent not prohibited by applicable law) and (iii) all other monetary obligations of the Issuers to the Holders and the Trustee and the Collateral Agent in respect of the Guaranteed Obligations.

(h) Each Note Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any Guaranteed Obligations guaranteed hereby until payment in full of all Guaranteed Obligations. Each Note Guarantor further agrees that, as between it, on the one hand, and the Holders and the Trustee, on the other hand, (i) the maturity of the Guaranteed Obligations guaranteed hereby may be accelerated as provided in Article 6 for the purposes of any Note Guarantee herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Guaranteed Obligations guaranteed hereby, and (ii) in the event of any declaration of acceleration of such Guaranteed Obligations as provided in Article 6, such Guaranteed Obligations (whether or not due and payable) shall forthwith become due and payable by such Note Guarantor for the purposes of this Section 11.01.

(i) Each Note Guarantor also agrees to pay any and all costs and expenses (including reasonable attorneys’ fees and expenses) incurred by the Trustee, the Collateral Agent or any Holder in enforcing any rights under this Section 11.01.

(j) Upon request of the Trustee, each Note Guarantor shall execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.

(k) Any Note Guarantee given by any direct or indirect parent of Holdings may be released and discharged from all obligations under this Article 11 at any time upon written notice to the Trustee from such direct or indirect parent of Holdings.

 

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SECTION 11.02. Limitation on Note Guarantor Liability.

(a) Any term or provision of this Indenture to the contrary notwithstanding, the maximum aggregate amount of the Guaranteed Obligations guaranteed hereunder by any Note Guarantor shall not exceed the maximum amount that can be hereby guaranteed without rendering this Indenture or the Note Guarantee, as each relates to such Note Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally.

(b) The Issuers, each Note Guarantor, each Holder, by its acceptance of Notes, and the Trustee hereby confirms that it is the intention of the parties to this Indenture that, except as set forth herein, the Note Guarantees under this Article 11 shall be Full and Unconditional as that term is defined in Rule 3-10 of Regulation S-X under the Securities Act (“Rule 3-10”), enforceable to the fullest extent permitted by law. In furtherance of the foregoing and to the extent applicable, a Note Guarantor’s liability in respect of its Note Guarantee shall be limited to the extent set forth below:

(i) Limitations Applicable to U.S. Note Guarantors. Each Note Guarantor that as of the date of this Indenture or thereafter is incorporated, organized or formed, as the case may be, under the laws of the United States, any State or Territory thereof or the District of Columbia (a “U.S. Note Guarantor”), and by its acceptance of Notes, each Holder and the Trustee, hereby confirms that it is the intention of all such parties that the Note Guarantee of such U.S. Note Guarantor shall not constitute a fraudulent transfer or conveyance for purposes of, or otherwise be invalidated under, any Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act, or under any other United States federal or state law or, to the extent applicable, any law of any other country or political subdivision thereof with respect to bankruptcy, insolvency, reorganization, fraudulent transfer, preference, moratorium or otherwise relating to or affecting the obligations of such U.S. Note Guarantor or the rights and remedies of creditors to the extent applicable to any Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and each U.S. Note Guarantor hereby irrevocably agree that the obligations of each U.S. Note Guarantor will be limited to the maximum amount that will, when taken together with and giving effect to (a) all contingent and fixed liabilities of such Note Guarantor, (b) any collections from, rights to receive contribution from or payments made by or on behalf of any other Note Guarantor in respect of the obligations of such other Note Guarantor under this Article 11, and (c) all other factors, in each case that are relevant under such laws, result in the obligations of such Note Guarantor under its Note Guarantee not constituting a fraudulent transfer or conveyance.

(ii) Limitations Applicable to Belgian Note Guarantors. Each Notes Guarantor that as of the date of this Indenture or thereafter is incorporated, organized or formed, as the case may be, in Belgium (a “Belgian Notes Guarantor”), and by its acceptance hereof, each Holder and the Trustee, hereby confirms that notwithstanding any other provision of this Indenture, or any related agreements or certificates, the maximum aggregate liability hereunder and under the Note Guarantee of any Belgian Notes Guarantor shall be limited to the extent required by applicable law including with respect to corporate benefit,

 

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and thus without such liability exceeding the corporate interest of the Belgian Guarantor, in each case as set forth in any supplemental indenture entered into by such Belgian Guarantor.

(iii) Limitations Applicable to German Note Guarantors. Each Note Guarantor incorporated, organized or formed, as the case may be, in Germany as a limited liability company (GmbH) (a “German GmbH Note Guarantor”) or a limited partnership with a limited liability company as its general partner (GmbH & Co. KG) (a “GmbH & Co KG Note Guarantor,” together with any German GmbH Note Guarantor hereinafter referred to a “German Note Guarantor”), and by its acceptance hereof, each Holder and the Trustee, hereby confirm that the liability of such German Note Guarantor, or in case of a GmbH & Co. KG Note Guarantor, its general partner, shall be limited to the Adjusted Net Assets as will, after giving effect to all other relevant contingent and fixed liabilities of such German Note Guarantor, or in case of a GmbH & Co. KG Note Guarantor, its general partner, or and after giving effect to any collections from or payments made by or on behalf of any other Note Guarantor in respect of the obligations of such other Note Guarantor under its Note Guarantee or pursuant to its contribution obligations under this Indenture, result in the obligations of such German Note Guarantor under its Note Guarantee not constituting a fraudulent conveyance or fraudulent transfer under applicable law. The obligation of any German Note Guarantor under this Article 11 will be binding only to the extent that it would not result in such German Note Guarantor’s, or in case of a GmbH & Co. KG Note Guarantor, its general partner’s, Adjusted Net Assets falling below the nominal registered share capital of such German Note Guarantor (Section 30 et seq. German GmbH Act (GmbH-Gesetz)), or, where such German Note Guarantor’s, or in case of a GmbH & Co. KG Note Guarantor, its general partner’s, Adjusted Net Assets are already below the amount of its registered share capital, would not cause such amount to be further reduced (Vertiefung einer Unterbilanz); provided that the limitations in this Section 11.02(iii) shall cease to apply:

(1) to the extent the German Note Guarantor secures any indebtedness under the Note Guarantee and this Indenture in respect of:

 

  (i) loans to the extent they are on-lent or otherwise passed on to the relevant German Note Guarantor, or in case of a GmbH & Co. KG Note Guarantor, to its general partner, or its subsidiaries and such amount on-lent or otherwise passed on is not returned; or

 

  (ii) bank guarantees or letters of credit that are issued and commercially related to the Notes for the benefit of any of the creditors of a German Note Guarantor or a German Note Guarantor’s subsidiaries (but excluding any Indebtedness resulting from a right to require cash collateralization); or

(2) if a domination agreement (Beherrschungsvertrag) or a profit absorption agreement (Gewinnabführungsvertrag) (either directly or through a chain

 

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of domination or profit absorption agreements) is or becomes effective between the relevant German Note Guarantor (or in case of a GmbH & Co. KG Note Guarantor, its general partner) as dominated entity (beherrschtes Unternehmen) and

 

  (i) if the German Note Guarantor (or in case of a GmbH & Co. KG Note Guarantor, its general partner) is a Subsidiary of the relevant obligor whose obligations are guaranteed under the Note Guarantee, that obligor; or

 

  (ii) if the German Note Guarantor (or in case of a GmbH & Co. KG Note Guarantor, its general partner) is a sister company of the relevant obligor whose obligations are guaranteed under the Note Guarantee, any joint (direct or indirect) parent company of the German Note Guarantor (or in case of a GmbH & Co. KG Note Guarantor, its general partner) and that obligor

as dominating entity (beherrschendes Unternehmen) and if and to the extent the existence of such domination agreement (Beherrschungsvertrag) or profit absorption agreement (Gewinnabführungsvertrag) leads to the inapplicability of section 30 paragraph 1 sentence 1 German GmbH Act (GmbH-Gesetz) as amended, supplemented and replaced from time to time; or

(3) if and to the extent for any other reason (including as a result of a change in the relevant rules of law) the deficit (Unterbilanz) referred to above does not constitute a breach of the German Note Guarantor’s or in case of a GmbH & Co. KG Note Guarantor, its general partner’s obligations to maintain its registered share capital pursuant to sections 30 et seq. of the German GmbH Act (GmbH-Gesetz), each as amended, supplemented and replaced from time to time.

For the purposes of this subsection, “Adjusted Net Assets” shall only take into account the sum of the values of the assets of the relevant German Note Guarantor (or in case of a GmbH & Co. KG Note Guarantor, of its general partner) less its liabilities, in each case determined in accordance with generally accepted accounting principals in Germany on the basis of the German Commercial Code (the “HGB”), but shall, for the avoidance of doubt, exclude the liabilities under or relating to the Note Guarantee. For the purposes of calculating the Adjusted Net Assets, the following balance sheet items shall be adjusted as follows, (a) the amount of any increase in the registered share capital of the relevant German Note Guarantor (or in case of a GmbH & Co. KG Note Guarantor, of its general partner) which was carried out after the relevant German Note Guarantor became a party to the Note Guarantee and/or this Indenture in violation of the Note Guarantee and/or this Indenture or which is not fully paid up (nicht voll eingezahlt) shall be deducted from the amount of the registered share capital of the relevant German Note Guarantor (or in case of a GmbH & Co. KG Note Guarantor, of its general partner), (b) loans or other contractual liabilities incurred by the relevant German Note Guarantor or as the case may be its general partner in breach of the Note Guarantee and/or this Indenture shall not be taken

 

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into account as liabilities; and (c) assets of the relevant German Note Guarantor, or in case of a GmbH & Co. KG Note Guarantor, its general partner, shall be disregarded to the extent and as long as profits would be prohibited from distribution pursuant to section 268 paragraph 8 of the HGB.

(iv) Limitations Applicable to Luxembourg Note Guarantors. Each Note Guarantor incorporated, organized or formed, as the case may be, in Luxembourg (a “Luxembourg Note Guarantor”), and by its acceptance hereof, each Holder and the Trustee, hereby confirm that the liability of such Luxembourg Note Guarantor shall be limited to the extent required by applicable law to the amount any such Luxembourg Note Guarantor can pay without resulting in the cessation of payments (cessation des paiements) of such Luxembourg Note Guarantor. The obligations of any Luxembourg Note Guarantor under this Article 11 will be binding only to the extent that they would not result in a misuse of corporate assets as defined under Article 171-1 of the Luxembourg law on commercial companies of August 10, 1915, as amended from time to time.

(v) Limitations Applicable to Certain Other Note Guarantors. Each Note Guarantor that as of the date of this Indenture or thereafter is incorporated, organized or formed, as the case may be, under the laws of any jurisdiction other than Australia and the British Virgin Islands, and those jurisdictions set forth in clauses (i) through (iv) above (an “Other Note Guarantor”), and by its acceptance hereof, each Holder and the Trustee, hereby confirm that it is the intention of all such parties that the Note Guarantee of an Other Note Guarantor does not constitute a fraudulent transfer or conveyance for purposes of, or otherwise violate, applicable law. To effectuate the foregoing intention, each Holder and each Other Note Guarantor hereby irrevocably agrees that the obligations of an Other Note Guarantor under its Note Guarantee shall be limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Other Note Guarantor result in the obligations of such Other Note Guarantor not constituting such a fraudulent transfer or conveyance or otherwise violating applicable law.

(vi) Mexican Note Guarantors. Each Note Guarantor organized under the laws of Mexico to the fullest extent permitted by law, until payment and discharge in full of each of the Issuer’s and each other Note Guarantor’s obligations under this Indenture, hereby unconditionally and irrevocably waives any right to which it may be entitled, to the extent applicable, pursuant to Articles 2813, 2814,2815,2816, 2817, 2818, 2819, 2820, 2821, 2822, 2823, 2824, 2826, 2827, 2830, 2835, 2836, 2837, 2838, 2839, 2840, 2842, 2844, 2846, 2847, 2848 and 2849 of the Federal Civil Code (Código Civil Federal) and the corresponding provisions of the Civil Codes of the States of Mexico and the Federal District.

(vii) Brazilian Note Guarantors. Each Note Guarantor organized under the laws of Brazil (i) agrees that it is jointly and severally liable with the Issuers under this Indenture, (ii) expressly waives the benefit of order (benefício de ordem) and any and all rights and other entitlements pursuant to Articles 821, 827, 828, 829, 834, 835, 837, 838 and 839 of the Brazilian Civil Code and Articles 77 and 595 of the Brazilian Code of Civil

 

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Procedure, as amended from time to time, and (iii) acknowledges that this Indenture shall not be considered a limited instrument of guarantee for the purposes of Article 822 of the Brazilian Civil Code, as amended from time to time.

(c) Notwithstanding anything in this Section 11.02 to the contrary, if following the date of this Indenture:

(i) there shall be any change in the laws of any of the jurisdictions set forth in clauses (ii) through (iv) of clause (b) of this Section 11.02;

(ii) there shall be any change in the laws under which any Other Note Guarantor is incorporated, organized or formed, as the case may be; or

(iii) any Person shall be required to execute a Note Guarantee pursuant to Section 4.10 or Section 11.01 or otherwise hereunder and such Person is incorporated, organized or formed, as the case may be, under the laws of any jurisdiction other than those in which entities are contemplated to become Note Guarantors as of the date hereof, including those jurisdictions addressed in clauses (i) through (iv) of clause (b) of this Section 11.02 and other than any jurisdiction in which a then existing Other Note Guarantor is incorporated, organized or formed, as the case may be (a “Future Note Guarantor”), and the Issuers shall reasonably determine that the provisions of Section 11.02(b)(v) hereof with respect to any Other Note Guarantor shall not adequately address the limitations on such Note Guarantee imposed by applicable law of the jurisdiction of incorporation, organization or formation, as the case may be, of such Future Note Guarantor;

(iv) then upon the delivery of an Officer’s Certificate, the Issuers shall be entitled to amend such clause or add such additional provisions to such clause, as the case may be, to the extent necessary so that the Note Guarantee of a Note Guarantor does not violate applicable law.

(d) A Note Guarantee as to any Note Guarantor shall automatically terminate and be of no further force or effect and such Note Guarantor shall be deemed to be released and discharged from all obligations under this Article 11 upon:

(i) the sale, disposition or other transfer (including through merger or consolidation) of the Capital Stock (including any sale, disposition or other transfer following which the applicable Note Guarantor is no longer a Restricted Subsidiary), or all or substantially all the assets, of the applicable Note Guarantor if such sale, disposition or other transfer is made in compliance with this Indenture,

(ii) Holdings designating such Note Guarantor to be an Unrestricted Subsidiary in accordance with the provisions set forth under Section 4.04 and the definition of “Unrestricted Subsidiary,”

(iii) in the case of any Restricted Subsidiary that after the Issue Date is required to guarantee the Securities pursuant to Section 4.10, the release or discharge of the guarantee by such Restricted Subsidiary of Indebtedness of Holdings or any Restricted

 

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Subsidiary of Holdings or such Restricted Subsidiary or the repayment of the Indebtedness or Disqualified Stock, in each case, which resulted in the obligation to guarantee the Securities, except if a release or discharge is by or as a result of payment under such other guarantee,

(iv) the Issuers’ exercise of its legal defeasance option or covenant defeasance option as described under Section 8.01 or if the Issuers’ obligations under this Indenture are discharged in accordance with the terms of this Indenture,

(v) upon release or discharge of all other Note Guarantees by such Note Guarantor of Indebtedness of the Issuers or any other Note Guarantor, except if a release or discharge is by or as a result of payment under such other guarantees or payment and discharge of such Indebtedness, or

(vi) the event that Rule 3-10 would require separate financial statements of any Subsidiary of Holdings that is a Note Guarantor to be filed with the SEC solely because such Subsidiary’s Note Guarantee is not a Full and Unconditional (as defined in Rule 3-10) guarantee under the Securities and this Indenture as reasonably determined by Holdings (the “Rule 3-10 Limitation”); provided, however, that such Subsidiary’s Note Guarantee will automatically be reinstated or provided on such date that it is reasonably determined by Holdings that the Rule 3-10 Limitation no longer exist.

Notwithstanding anything else to the contrary, Holdings will be Note Guarantor for so long as the Securities are outstanding.

SECTION 11.03. No Waiver. Neither a failure nor a delay on the part of either the Trustee or the Holders in exercising any right, power or privilege under this Article 11 shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further exercise of any right, power or privilege. The rights, remedies and benefits of the Trustee and the Holders herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under this Article 11 at law, in equity, by statute or otherwise.

SECTION 11.04. Modification. No modification, amendment or waiver of any provision of this Article 11, nor the consent to any departure by any Note Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, 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 any Note Guarantor in any case shall entitle such Note Guarantor to any other or further notice or demand in the same, similar or other circumstances.

SECTION 11.05. Execution of Supplemental Indenture for Future Guarantors. Each Subsidiary and other Person which is required to become a Note Guarantor pursuant to Section 4.10, subject to Section 11.02(c) hereof, shall promptly execute and deliver to the Trustee a supplemental indenture in the form of Exhibit D hereto pursuant to which such Subsidiary or other Person shall become a Note Guarantor under this Article 11 and shall guarantee the Guaranteed Obligations. Concurrently with the execution and delivery of such supplemental

 

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indenture, the Issuers shall deliver to the Trustee an Officer’s Certificate stating that such supplemental indenture is authorized or permitted by this Indenture and an Opinion of Counsel to the effect that such supplemental indenture is authorized or permitted by this Indenture and, subject to customary exceptions, is a legal, valid and binding obligation of such Note Guarantor, enforceable against such Note Guarantor in accordance with its terms.

SECTION 11.06. Non-Impairment. The failure to endorse a Note Guarantee on any Security shall not affect or impair the validity thereof.

ARTICLE 12

MISCELLANEOUS

SECTION 12.01. Trust Indenture Act Controls. From the date on which this Indenture is qualified under the TIA, if and to the extent that any provision of this Indenture limits, qualifies or conflicts with the duties imposed by, or with another provision (an “incorporated provision”) included in this Indenture by operation of, Sections 310 to 318 of the TIA, inclusive, such imposed duties or incorporated provision shall control.

SECTION 12.02. Notices.

(a) Any notice or communication required or permitted hereunder shall be in writing and delivered in person, via facsimile or mailed by first-class mail or electronic mail addressed as follows:

if to the Issuers or a Note Guarantor:

Pinafore, Inc.

Pinafore, LLC

1551 Wewatta Street

Denver, Colorado 80202

United States

Attention: Kathleen Sullivan

Facsimile: (303) 744-4761

if to the Trustee or Collateral Agent:

Wilmington Trust FSB

246 Goose Lane, Suite 105

Guilford, CT 06437

Attention of: Pinafore Administrator

Facsimile: (203) 453-1183

The Issuers or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.

 

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(b) Any notice or communication mailed to a Holder shall be mailed, first class mail, to the Holder at the Holder’s address as it appears on the registration books of the Registrar and shall be sufficiently given if so mailed within the time prescribed.

(c) Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it, except that notices to the Trustee are effective only if received.

Notwithstanding any other provision of this Indenture or any Security, where this Indenture or any Security provides for notice of any event (including any notice of redemption) to a Holder of a Global Security (whether by mail or otherwise), such notice shall be sufficiently given if given to the Depository for such Security (or its designee), pursuant to the customary procedures of such Depository.

SECTION 12.03. Communication by the Holders with Other Holders. The Holders may communicate pursuant to Section 312(b) of the TIA with other Holders with respect to their rights under this Indenture or the Securities. The Issuers, the Trustee, the Registrar and other Persons shall have the protection of Section 312(c) of the TIA.

SECTION 12.04. Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Issuers to the Trustee to take or refrain from taking any action under this Indenture, the Issuers shall furnish to the Trustee at the request of the Trustee:

(a) an Officer’s Certificate in form reasonably satisfactory to the Trustee stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and

(b) an Opinion of Counsel in form reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all such conditions precedent have been complied with.

SECTION 12.05. Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture (other than pursuant to Section 4.09) shall include:

(a) a statement that the individual making such certificate or opinion has read such covenant or condition;

(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(c) a statement that, in the opinion of such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

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(d) a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with; provided, however, that with respect to matters of fact an Opinion of Counsel may rely on an Officer’s Certificate or certificates of public officials.

SECTION 12.06. When Securities Disregarded. In determining whether the Holders of the required principal amount of Securities have concurred in any direction, waiver or consent, Securities owned by the Issuers, any Note Guarantor or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuers or any Note Guarantor shall be disregarded and deemed not to be outstanding, except that, for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Securities which the Trustee knows are so owned shall be so disregarded. Subject to the foregoing, only Securities outstanding at the time shall be considered in any such determination.

SECTION 12.07. Rules by Trustee, Paying Agent and Registrar. The Trustee may make reasonable rules for action by or a meeting of the Holders. The Registrar and a Paying Agent may make reasonable rules for their functions.

SECTION 12.08. Legal Holidays. If a payment date is not a Business Day, payment shall be made on the next succeeding day that is a Business Day, and no interest shall accrue on any amount that would have been otherwise payable on such payment date if it were a Business Day for the intervening period. If a regular record date is not a Business Day, the record date shall not be affected.

SECTION 12.09. Governing Law. THIS INDENTURE AND THE SECURITIES (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

(a) Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Indenture, the Securities or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and, subject to the final sentence of this Section 12.09(a), each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints

 

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Pinafore, LLC as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

(b) Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment, including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

(c) Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

SECTION 12.10. No Recourse Against Others. No director, officer, employee, incorporator or holder of any equity interests in the Issuers or Holdings or any other direct or indirect parent or any Note Guarantor, as such, shall have any liability for any obligations of the Issuers or the Note Guarantors under the Securities, the Note Guarantees or this Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Securities by accepting a Security waives and releases all such liability.

 

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SECTION 12.11. Successors. All agreements of the Issuers and each Note Guarantor in this Indenture and the Securities shall bind its successors. All agreements of the Trustee in this Indenture shall bind its successors.

SECTION 12.12. Multiple Originals. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. One signed copy is enough to prove this Indenture.

SECTION 12.13. Table of Contents; Headings. The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.

SECTION 12.14. Indenture Controls. If and to the extent that any provision of the Securities or Second Lien Collateral Documents limit, qualify or conflict with a provision of this Indenture, such provision of this Indenture shall control.

SECTION 12.15. Severability. In case any provision in this Indenture 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 and such provision shall be ineffective only to the extent of such invalidity, illegality or unenforceability.

SECTION 12.16. Waiver of Jury Trial. EACH OF THE ISSUERS, THE NOTE GUARANTORS, THE TRUSTEE, THE PAYING AGENT, THE REGISTRAR, THE TRANSFER AGENT AND THE COLLATERAL AGENT HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE SECURITIES OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.

 

PINAFORE, LLC
By:   

/s/ Donald West

   Name: Donald West
   Title: Authorized Officer
PINAFORE, INC.
By:   

/s/ Donald West

   Name: Donald West
   Title: Authorized Officer

CARRIAGE HOUSE FRUIT COMPANY BROADWAY MISSISSIPPI DEVELOPMENT, LLC

GATES DEVELOPMENT CORPORATION

GATES INTERNATIONAL HOLDINGS, LLC

AIR SYSTEM COMPONENTS, INC.

AQUATIC CO.

AQUATIC TRUCKING CO.

BUFFALO HOLDING COMPANY

CONERGICS CORPORATION

DEXTER AXLE ACQUISITION CORP.

DEXTER AXLE COMPANY

DEXTER AXLE TRUCKING COMPANY

EPICOR INDUSTRIES, INC.

GATES MECTROL, INC.

 

HART & COOLEY TRUCKING COMPANY

HART & COOLEY, INC.

NRG INDUSTRIES, INC. (Delaware entity)

PLEWS, INC.

RUSKIN COMPANY

RUSKIN SERVICE COMPANY

SCHRADER ELECTRONICS, INC.

SCHRADER INTERNATIONAL HOLDING CO.

SHRADER, LLC

SHRADER-BRIDGEPORT INTERNATIONAL, INC.

SELKIRK AMERICAS, L.P.

SELKIRK CANADA HOLDINGS, L.P.

SELKIRK CORPORATION

SELKIRK IP L.L.C.

THE GATES CORPORATION

TOMKINS AUTOMOTIVE HOLDING CO.

TOMKINS CORPORATION

TOMKINS U.S., L.P.

WALTHAM REAL ESTATE HOLDING CO.

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Second Lien Indenture Signature Page

E INDUSTRIES, INC.

KOCH FILTER CORPORATION

DEXTER CHASSIS GROUP, INC.

EASTERN SHEET METAL, INC.

FBN TRANSPORTATION, INC.

TOMKINS INDUSTRIES, INC.

IDEAL CLAMP PRODUCTS, INC.

GLASS MASTER CORPORATION

NATIONAL DUCT SYSTEMS, INC.

NRG INDUSTRIES, INC. (Texas entity)

ROOFTOP SYSTEMS, INC.

HYTEC, INC.

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Second Lien Indenture Signature Page

ACD TRIDON (HOLDINGS) LIMITED

AIR SYSTEMS COMPONENTS INVESTMENTS

CHINA LIMITED

BETA NACO LIMITED

BRITISH INDUSTRIAL VALVE COMPANY LIMITED

GATES ENGINEERING & SERVICES UK

HOLDINGS LIMITED

GATES FLUID POWER TECHNOLOGIES

INVESTMENTS LIMITED

GATES HOLDINGS LIMITED

H HEATON LIMITED

OLYMPUS (ORMSKIRK) LIMITED

RUSKIN AIR MANAGEMENT LIMITED

SHITAKE LIMITED

STACKPOLE INVESTMENTS LIMITED

SWINDON SILICON SYSTEMS LIMITED

TOMKINS ENGINEERING LIMITED

TOMKINS FINANCE LUXEMBOURG LIMITED

TOMKINS FINANCE LIMITED

TOMKINS FUNDING LIMITED

TOMKINS IDEAL CLAMPS (SUZHOU)

INVESTMENTS LIMITED

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Second Lien Indenture Signature Page

TOMKINS INVESTMENTS CHINA LIMITED

TOMKINS INVESTMENTS LIMITED

TOMKINS OVERSEAS COMPANY

TOMKINS OVERSEAS INVESTMENTS LIMITED

TOMKINS PENSION SERVICES LIMITED

TOMKINS LIMITED

TOMKINS SCI LIMITED

TOMKINS STERLING COMPANY

TOMKINS TREASURY (CANADIAN DOLLAR) COMPANY

TOMKINS TREASURY (DOLLAR) COMPANY

TOMKINS TREASURY (EURO) COMPANY

TRICO PRODUCTS (DUNSTABLE) LIMITED

WILLER & RILEY LIMITED

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Second Lien Indenture Signature Page

PINAFORE HOLDINGS B.V.

By:   /s/ Donald West
  Name: Donald West
  Title: Authorized Officer

Second Lien Indenture Signature Page

MONTISK INVESTMENTS NETHERLANDS, C.V.
By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Second Lien Indenture Signature Page

SCHRADER INVESTMENTS LUXEMBOURG S.AR.L.

TOMKINS AMERICAN INVESTMENTS S.A.R.L.

TOMKINS AUTOMOTIVE COMPANY, S.A.R.L.

TOMKINS HOLDINGS LUXEMBOURG, S.A.R.L.

TOMKINS INVESTMENT COMPANY S.A.R.L.

TOMKINS LUXEMBOURG S.A.R.L.

TOMKINS OVERSEAS HOLDINGS S.A.R.L.

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Second Lien Indenture Signature Page

PINAFORE ACQUISITIONS LIMITED
By:   /s/ Todd Clegg
  Name: Todd Clegg
  Title: Authorized Officer

Second Lien Indenture Signature Page

GATES AUTO PARTS HOLDINGS CHINA LIMITED
By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Second Lien Indenture Signature Page

WILMINGTON TRUST FSB, as Trustee
By:  

/s/ Joseph P. O’Donnell

  Name: Joseph P. O’Donnell
  Title: Vice President
WILMINGTON TRUST FSB, as Collateral Agent
By:  

/s/ Joseph P. O’Donnell

  Name: Joseph P. O’Donnell
  Title: Vice President

APPENDIX A

PROVISIONS RELATING TO INITIAL SECURITIES, ADDITIONAL SECURITIES AND EXCHANGE SECURITIES

1. Definitions.

1.1 Definitions.

For the purposes of this Appendix A the following terms shall have the meanings indicated below:

“Clearstream” means Clearstream Banking, société anonyme, or any successor securities clearing agency.

“Definitive Security” means a certificated Initial Security or Exchange Security (bearing the Restricted Securities Legend if the transfer of such Security is restricted by applicable law) that does not include the Global Securities Legend.

“Depository” means, with respect to the Securities, The Depository Trust Company, its nominees and their respective successors.

“Euroclear” means the Euroclear Clearance System or any successor securities clearing agency.

“Global Securities Legend” means the legend set forth under that caption in the applicable Exhibit to this Indenture.

“IAI” means an institutional “accredited investor” as described in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

“Initial Purchasers” means Banc of America Securities LLC, Citigroup Global Markets Inc., Barclays Capital Inc., RBC Capital Markets Corporation and UBS Securities LLC and such other initial purchasers party to the purchase agreement or future purchase agreements entered into in connection with an offer and sale of Securities.

“Purchase Agreement” means (a) the Purchase Agreement dated September 21, 2010, among the Issuers, the Note Guarantors and the Initial Purchasers and (b) any other similar Purchase Agreement relating to Additional Securities.

“QIB” means a “qualified institutional buyer” as defined in Rule 144A.

“Registration Rights Agreement” means (a) the Registration Rights Agreement dated as of September 29, 2010 among the Issuers, the Note Guarantors and the Initial Purchasers relating to the Securities and (b) any other similar Registration Rights Agreement relating to Additional Securities.

“Registered Exchange Offer” means the offer by the Issuers, pursuant to the Registration Rights Agreement, to certain Holders of Initial Securities, to issue and deliver to such Holders, in exchange for their Initial Securities, a like aggregate principal amount of Exchange Securities registered under the Securities Act.

“Regulation S” means Regulation S under the Securities Act.

“Regulation S Securities” means all Initial Securities offered and sold outside the United States in reliance on Regulation S.

“Restricted Period,” with respect to any Securities, means the period of 40 consecutive days beginning on and including the later of (a) the day on which such Securities are first offered to persons other than distributors (as defined in Regulation S under the Securities Act) in reliance on Regulation S, notice of which day shall be promptly given by the Issuers to the Trustee, and (b) the Issue Date, and with respect to any Additional Securities that are Transfer Restricted Definitive Securities, it means the comparable period of 40 consecutive days.

“Restricted Securities Legend” means the legend set forth in Section 2.2(f)(i) of this Appendix A.

“Rule 501” means Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

“Rule 144A” means Rule 144A under the Securities Act.

“Rule 144A Securities” means all Initial Securities offered and sold to QIBs in reliance on Rule 144A.

“Securities Custodian” means the custodian with respect to a Global Security (as appointed by the Depository) or any successor person thereto, who shall initially be the Trustee.

“Shelf Registration Statement” means a registration statement filed by the Issuers in connection with the offer and sale of Initial Securities pursuant to the Registration Rights Agreement.

“Transfer Restricted Definitive Securities” means Definitive Securities and any other Securities that bear or are required to bear or are subject to the Restricted Securities Legend.

“Transfer Restricted Global Securities” means Global Securities bearing the Restricted Securities Legend.

“Unrestricted Definitive Security” means Definitive Securities and any other Securities that are not required to bear, or are not subject to, the Restricted Securities Legend.

“Unrestricted Global Security” means a Global Security that does not bear the Restricted Securities Legend.

 

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1.2 Other Definitions.

 

Term:

    Defined in Section:

“Agent Members”

    2.1(b)

“Global Securities”

    2.1(b)

“Regulation S Global Securities”

    2.1(b)

“Rule 144A Global Securities”

    2.1(b)

2. The Securities.

2.1 Form and Dating; Global Securities.

(a) The Initial Securities issued on the date hereof will be (i) offered and sold by the Issuers pursuant to the Purchase Agreement and (ii) resold, initially only to (1) QIBs in reliance on Rule 144A and (2) Persons other than U.S. Persons (as defined in Regulation S) in reliance on Regulation S. Such Initial Securities may thereafter be transferred to, among others, QIBs, purchasers in reliance on Regulation S and, except as set forth below, IAIs in accordance with Rule 501. Additional Securities offered after the date hereof may be offered and sold by the Issuers from time to time pursuant to one or more Purchase Agreements in accordance with applicable law.

(b) Global Securities. (i) Rule 144A Securities initially shall be represented by one or more Securities in fully registered, global form without interest coupons (collectively, the “Rule 144A Global Securities”). Regulation S Securities initially shall be represented by one or more Securities in fully registered, global form without interest coupons (collectively, the “Regulation S Global Securities”). The term “Global Securities” means, collectively, the Rule 144A Global Securities and the Regulation S Global Securities. The Global Securities shall bear the Global Security Legend. The Global Securities initially shall (i) be registered in the name of the Depository or the nominee of such Depository, in each case for credit to an account of an Agent Member, (ii) be delivered to the Trustee as custodian for such Depository and (iii) bear the Restricted Securities Legend.

Members of, or direct or indirect participants in, the Depository, Euroclear or Clearstream (“Agent Members”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depository or under the Global Securities. The Depository may be treated by the Issuers, the Trustee and any agent of the Issuers or the Trustee as the absolute owner of the Global Securities for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuers, the Trustee or any agent of the Issuers or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depository or impair, as between the Depository, Euroclear or Clearstream, as the case may be, and their respective Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Security.

(ii) Transfers of Global Securities shall be limited to transfer in whole, but not in part, to the Depository, its successors or their respective nominees. Interests of beneficial

 

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owners in the Global Securities may be transferred or exchanged for Definitive Securities only in accordance with the applicable rules and procedures of the Depository, Euroclear or Clearstream, as the case may be, and the provisions of Section 2.2. In addition, a Global Security shall be exchangeable for Definitive Securities if (i) the Depository (x) notifies the Issuers that it is unwilling or unable to continue as depository for such Global Security and the Issuers thereupon fail to appoint a successor depository or (y) has ceased to be a clearing agency registered under the Exchange Act, or (ii) there shall have occurred and be continuing an Event of Default with respect to such Global Security and the Depository requests the issuance of Definitive Securities. In all cases, Definitive Securities delivered in exchange for any Global Security or beneficial interests therein shall be registered in the names, and issued in any approved denominations, requested in writing by or on behalf of the Depository, in accordance with its customary procedures.

(iii) In connection with the transfer of a Global Security as an entirety to beneficial owners pursuant to subsection (i) of this Section 2.1(b), such Global Security shall be deemed to be surrendered to the Trustee for cancellation, and the Issuers shall execute, and upon receipt of an Authentication Order the Trustee shall authenticate and make available for delivery, to each beneficial owner identified by the Depository in writing in exchange for its beneficial interest in such Global Security, an equal aggregate principal amount of Definitive Securities of authorized denominations.

(iv) Any Transfer Restricted Definitive Security delivered in exchange for an interest in a Global Security pursuant to Section 2.2 shall, except as otherwise provided in Section 2.2, bear the Restricted Securities Legend.

(v) Notwithstanding the foregoing, through the Restricted Period, a beneficial interest in such Regulation S Global Security may be held only through Euroclear or Clearstream unless delivery is made in accordance with the applicable provisions of Section 2.2.

(vi) The Holder of any Global Security may grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities.

2.2 Transfer and Exchange.

(a) Transfer and Exchange of Global Securities. A Global Security may not be transferred as a whole except as set forth in Section 2.1(b). Global Securities will not be exchanged by the Issuers for Definitive Securities except under the circumstances described in Section 2.1(b)(ii). Global Securities also may be exchanged or replaced, in whole or in part, as provided in Sections 2.08 and 2.10 of this Indenture. Beneficial interests in a Global Security may be transferred and exchanged as provided in Section 2.2(b) or 2.2(g) of this Appendix A.

(b) Transfer and Exchange of Beneficial Interests in Global Securities. The transfer and exchange of beneficial interests in the Global Securities shall be effected through the Depository, in accordance with the provisions of this Indenture and the applicable rules and procedures of the Depository. Beneficial interests in Transfer Restricted Global Securities shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by

 

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the Securities Act. Transfers and exchanges of beneficial interests in the Global Securities also shall require compliance with either subparagraph (i) or (ii) below, as applicable, as well as one or more of the other following subparagraphs, as applicable:

(i) Transfer of Beneficial Interests in the Same Global Security. Beneficial interests in any Transfer Restricted Global Security may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Transfer Restricted Global Security in accordance with the transfer restrictions set forth in the Restricted Securities Legend; provided, however, that prior to the expiration of the Restricted Period, transfers of beneficial interests in a Regulation S Global Security may not be made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). A beneficial interest in an Unrestricted Global Security may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security. No written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this Section 2.2(b)(i).

(ii) All Other Transfers and Exchanges of Beneficial Interests in Global Securities. In connection with all transfers and exchanges of beneficial interests in any Global Security that is not subject to Section 2.2(b)(i), the transferor of such beneficial interest must deliver to the Registrar (1) a written order from an Agent Member given to the Depository in accordance with the applicable rules and procedures of the Depository directing the Depository to credit or cause to be credited a beneficial interest in another Global Security in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the applicable rules and procedures of the Depository containing information regarding the Agent Member account to be credited with such increase; provided that in no event shall a beneficial interest in a Global Security be credited, or an Unrestricted Definitive Security be issued, to a Person who is an affiliate (as defined in Rule 144) of the Issuers. Upon satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Securities contained in this Indenture and the Securities or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Security pursuant to Section 2.2(g).

(iii) Transfer of Beneficial Interests to Another Transfer Restricted Global Security. A beneficial interest in a Transfer Restricted Global Security may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Transfer Restricted Global Security if the transfer complies with the requirements of Section 2.2(b)(ii) above and the Registrar receives the following:

(A) if the transferee will take delivery in the form of a beneficial interest in a Rule 144A Global Security, then the transferor must deliver a certificate in the form attached to the applicable Security; and

(B) if the transferee will take delivery in the form of a beneficial interest in a Regulation S Global Security, then the transferor must deliver a certificate in the form attached to the applicable Security.

 

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(iv) Transfer and Exchange of Beneficial Interests in a Transfer Restricted Global Security for Beneficial Interests in an Unrestricted Global Security. A beneficial interest in a Transfer Restricted Global Security may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Security or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security if the exchange or transfer complies with the requirements of Section 2.2(b)(ii) above and the Registrar receives the following:

(A) if the holder of such beneficial interest in a Transfer Restricted Global Security proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global Security, a certificate from such holder in the form attached to the applicable Security; or

(B) if the holder of such beneficial interest in a Transfer Restricted Global Security proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security, a certificate from such holder in the form attached to the applicable Security,

and, in each such case, if the Issuers so request or if the applicable rules and procedures of the Depository, Euroclear or Clearstream, as applicable, so require, an Opinion of Counsel to the Issuers and the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Restricted Securities Legend are no longer required in order to maintain compliance with the Securities Act. If any such transfer or exchange is effected pursuant to this subparagraph (iv) at a time when an Unrestricted Global Security has not yet been issued, the Issuers shall issue and, upon receipt of an Authentication Order, the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred or exchanged pursuant to this subparagraph (iv).

(v) Transfer and Exchange of Beneficial Interests in an Unrestricted Global Security for Beneficial Interests in a Transfer Restricted Global Security. Beneficial interests in an Unrestricted Global Security cannot be exchanged for, or transferred to Persons who take delivery thereof in the form of, a beneficial interest in a Transfer Restricted Global Security.

(c) Transfer and Exchange of Beneficial Interests in Global Securities for Definitive Securities. A beneficial interest in a Global Security may not be exchanged for a Definitive Security except under the circumstances described in Section 2.1(b)(ii). A beneficial interest in a Global Security may not be transferred to a Person who takes delivery thereof in the form of a Definitive Security except under the circumstances described in Section 2.1(b)(ii).

(d) Transfer and Exchange of Definitive Securities for Beneficial Interests in Global Securities. Transfers and exchanges of beneficial interests in the Global Securities shall require compliance with either subparagraph (i), (ii) or (iii) below, as applicable:

 

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(i) Transfer Restricted Definitive Securities to Beneficial Interests in Transfer Restricted Global Securities. If any Holder of a Transfer Restricted Definitive Security proposes to exchange such Transfer Restricted Definitive Security for a beneficial interest in a Transfer Restricted Global Security or to transfer such Transfer Restricted Definitive Security to a Person who takes delivery thereof in the form of a beneficial interest in a Transfer Restricted Global Security, then, upon receipt by the Registrar of the following documentation:

(A) if the Holder of such Transfer Restricted Definitive Security proposes to exchange such Transfer Restricted Definitive Security for a beneficial interest in a Transfer Restricted Global Security, a certificate from such Holder in the form attached to the applicable Security;

(B) if such Transfer Restricted Definitive Security is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certificate from such Holder in the form attached to the applicable Security;

(C) if such Transfer Restricted Definitive Security is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904 under the Securities Act, a certificate from such Holder in the form attached to the applicable Security;

(D) if such Transfer Restricted Definitive Security is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate from such Holder in the form attached to the applicable Security;

(E) if such Transfer Restricted Definitive Security is being transferred to an IAI in reliance on an exemption from the registration requirements of the Securities Act other than those listed in subparagraphs (B) through (D) above, a certificate from such Holder in the form attached to the applicable Security, including the certifications, certificates and Opinion of Counsel, if applicable; or

(F) if such Transfer Restricted Definitive Security is being transferred to the Issuers or a Subsidiary thereof, a certificate from such Holder in the form attached to the applicable Security;

the Trustee shall cancel the Transfer Restricted Definitive Security, and increase or cause to be increased the aggregate principal amount of the appropriate Transfer Restricted Global Security.

(ii) Transfer Restricted Definitive Securities to Beneficial Interests in Unrestricted Global Securities. A Holder of a Transfer Restricted Definitive Security may exchange such Transfer Restricted Definitive Security for a beneficial interest in an Unrestricted Global Security or transfer such Transfer Restricted Definitive Security to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security only if the Registrar receives the following:

 

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(A) if the Holder of such Transfer Restricted Definitive Security proposes to exchange such Transfer Restricted Definitive Security for a beneficial interest in an Unrestricted Global Security, a certificate from such Holder in the form attached to the applicable Security; or

(B) if the Holder of such Transfer Restricted Definitive Securities proposes to transfer such Transfer Restricted Definitive Security to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security, a certificate from such Holder in the form attached to the applicable Security,

and, in each such case, if the Issuers so request or if the applicable rules and procedures of the Depository, Euroclear or Clearstream, as applicable, so require, an Opinion of Counsel to the Issuers and the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Restricted Securities Legend are no longer required in order to maintain compliance with the Securities Act. Upon satisfaction of the conditions of this subparagraph (ii), the Trustee shall cancel the Transfer Restricted Definitive Securities and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Security. If any such transfer or exchange is effected pursuant to this subparagraph (ii) at a time when an Unrestricted Global Security has not yet been issued, the Issuers shall issue and, upon receipt of an Authentication Order, the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the aggregate principal amount of Transfer Restricted Definitive Securities transferred or exchanged pursuant to this subparagraph (ii).

(iii) Unrestricted Definitive Securities to Beneficial Interests in Unrestricted Global Securities. A Holder of an Unrestricted Definitive Security may exchange such Unrestricted Definitive Security for a beneficial interest in an Unrestricted Global Security or transfer such Unrestricted Definitive Security to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security at any time. Upon receipt of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive Security and increase or cause to be increased the aggregate principal amount of one of the Unrestricted Global Securities. If any such transfer or exchange is effected pursuant to this subparagraph (iii) at a time when an Unrestricted Global Security has not yet been issued, the Issuers shall issue and, upon receipt of an Authentication Order, the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the aggregate principal amount of Unrestricted Definitive Securities transferred or exchanged pursuant to this subparagraph (iii).

(iv) Unrestricted Definitive Securities to Beneficial Interests in Transfer Restricted Global Securities. An Unrestricted Definitive Security cannot be exchanged for, or transferred to a Person who takes delivery thereof in the form of, a beneficial interest in a Transfer Restricted Global Security.

 

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(e) Transfer and Exchange of Definitive Securities for Definitive Securities. Upon request by a Holder of Definitive Securities and such Holder’s compliance with the provisions of this Section 2.2(e), the Registrar shall register the transfer or exchange of Definitive Securities. Prior to such registration of transfer or exchange, the requesting Holder shall present or surrender to the Registrar the Definitive Securities duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar duly executed by such Holder or by its attorney, duly authorized in writing. In addition, the requesting Holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.2(e).

(i) Transfer Restricted Definitive Securities to Transfer Restricted Definitive Securities. A Transfer Restricted Definitive Security may be transferred to and registered in the name of a Person who takes delivery thereof in the form of a Transfer Restricted Definitive Security if the Registrar receives the following:

(A) if the transfer will be made pursuant to Rule 144A under the Securities Act, then the transferor must deliver a certificate in the form attached to the applicable Security;

(B) if the transfer will be made pursuant to Rule 903 or Rule 904 under the Securities Act, then the transferor must deliver a certificate in the form attached to the applicable Security;

(C) if the transfer will be made pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate in the form attached to the applicable Security;

(D) if the transfer will be made to an IAI in reliance on an exemption from the registration requirements of the Securities Act other than those listed in subparagraphs (A) through (C) above, a certificate in the form attached to the applicable Security; and

(E) if such transfer will be made to the Issuers or a Subsidiary thereof, a certificate in the form attached to the applicable Security.

(ii) Transfer Restricted Definitive Securities to Unrestricted Definitive Securities. Any Transfer Restricted Definitive Security may be exchanged by the Holder thereof for an Unrestricted Definitive Security or transferred to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security if the Registrar receives the following:

(1) if the Holder of such Transfer Restricted Definitive Security proposes to exchange such Transfer Restricted Definitive Security for an Unrestricted Definitive Security, a certificate from such Holder in the form attached to the applicable Security; or

(2) if the Holder of such Transfer Restricted Definitive Security proposes to transfer such Securities to a Person who shall take delivery thereof in the

 

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form of an Unrestricted Definitive Security, a certificate from such Holder in the form attached to the applicable Security,

and, in each such case, if the Issuers so request, an Opinion of Counsel to the Issuers and the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Restricted Securities Legend are no longer required in order to maintain compliance with the Securities Act.

(iii) Unrestricted Definitive Securities to Unrestricted Definitive Securities. A Holder of an Unrestricted Definitive Security may transfer such Unrestricted Definitive Securities to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security at any time. Upon receipt of a request to register such a transfer, the Registrar shall register the Unrestricted Definitive Securities pursuant to the instructions from the Holder thereof.

(iv) Unrestricted Definitive Securities to Transfer Restricted Definitive Securities. An Unrestricted Definitive Security cannot be exchanged for, or transferred to a Person who takes delivery thereof in the form of, a Transfer Restricted Definitive Security.

At such time as all beneficial interests in a particular Global Security have been exchanged for Definitive Securities or a particular Global Security has been redeemed, repurchased or canceled in whole and not in part, each such Global Security shall be returned to or retained and canceled by the Trustee in accordance with Section 2.11. At any time prior to such cancellation, if any beneficial interest in a Global Security is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security or for Definitive Securities, the principal amount of Securities represented by such Global Security shall be reduced accordingly and an endorsement shall be made on such Global Security by the Trustee or by the Depository, at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security, such other Global Security shall be increased accordingly and an endorsement shall be made on such Global Security by the Trustee or by the Depository, at the direction of the Trustee to reflect such increase.

(f) Legend.

(i) Except as permitted by the following paragraphs (ii), (iii) or (iv), each Security certificate evidencing the Global Securities and the Definitive Securities (and all Securities issued in exchange therefor or in substitution thereof) shall bear a legend in substantially the following form (each defined term in the legend being defined as such for purposes of the legend only):

“THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THE SECURITY

 

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EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (i) (a) TO A PERSON WHO IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO NON-U.S. PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE ISSUER SO REQUESTS), (ii) TO THE ISSUER, OR (iii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE. NO REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION PROVIDED BY RULE 144 FOR RESALE OF THE SECURITY EVIDENCED HEREBY.”

Each Regulation S Security that is a Temporary Security issued pursuant to Section 2.10 shall bear a legend in substantially in the following form:

“THE RIGHTS ATTACHING TO THIS REGULATION S GLOBAL SECURITY THAT IS A TEMPORARY SECURITY, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE SECURITY, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN).”

Each Definitive Security shall bear the following additional legends:

“IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.”

 

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Each Security issued hereunder that has more than a de minimis amount of original issue discount for U.S. Federal Income Tax purposes shall bear a legend in substantially the following form:

“THIS SECURITY IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE. TO OBTAIN THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE AND YIELD TO MATURITY FOR SUCH SECURITIES, A HOLDER MAY SUBMIT WRITTEN REQUEST FOR SUCH INFORMATION TO THE ISSUER AT THE FOLLOWING ADDRESS: [                    ].”

(ii) Upon any sale or transfer of a Transfer Restricted Definitive Security that is a Definitive Security, the Registrar shall permit the Holder thereof to exchange such Transfer Restricted Definitive Security for a Definitive Security that does not bear the legends set forth above and rescind any restriction on the transfer of such Transfer Restricted Definitive Security if the Holder certifies in writing to the Registrar that its request for such exchange was made in reliance on Rule 144 (such certification to be in the form set forth on the reverse of the Initial Security).

(iii) After a transfer of any Initial Securities during the period of the effectiveness of a Shelf Registration Statement with respect to such Initial Securities, all requirements pertaining to the Restricted Securities Legend on such Initial Securities shall cease to apply and the requirements that any such Initial Securities be issued in global form shall continue to apply.

(iv) Upon the consummation of a Registered Exchange Offer with respect to the Initial Securities pursuant to which Holders of such Initial Securities are offered Exchange Securities in exchange for their Initial Securities, all requirements pertaining to Initial Securities that Initial Securities be issued in global form shall continue to apply, and Exchange Securities in global form without the Restricted Securities Legend shall be available to Holders that exchange such Initial Securities in such Registered Exchange Offer.

(v) Upon a sale or transfer after the expiration of the Restricted Period of any Initial Security acquired pursuant to Regulation S, all requirements that such Initial Security bear the Restricted Securities Legend shall cease to apply and the requirements requiring any such Initial Security be issued in global form shall continue to apply.

(vi) Any Additional Securities sold in a registered offering shall not be required to bear the Restricted Securities Legend.

(g) Cancellation or Adjustment of Global Security. At such time as all beneficial interests in a particular Global Security have been exchanged for Definitive Securities or a particular Global Security has been redeemed, repurchased or canceled in whole and not in part, each such Global Security shall be returned to or retained and canceled by the Trustee in accordance with Section 2.11 of this Indenture. At any time prior to such cancellation, if any beneficial interest in a Global Security is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security or for Definitive

 

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Securities, the principal amount of Securities represented by such Global Security shall be reduced accordingly and an endorsement shall be made on such Global Security by the Trustee or by the Depository, at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security, such other Global Security shall be increased accordingly and an endorsement shall be made on such Global Security by the Trustee or by the Depository, at the direction of the Trustee to reflect such increase.

(h) Obligations with Respect to Transfers and Exchanges of Securities.

(i) To permit registrations of transfers and exchanges, the Issuers shall execute and upon receipt of an Authentication Order the Trustee shall authenticate, Definitive Securities and Global Securities at the Registrar’s request.

(ii) No service charge shall be made for any registration of transfer or exchange, but the Issuers may require payment of a sum sufficient to cover any transfer tax, assessments, or similar governmental charge payable in connection therewith (other than any such transfer taxes, assessments or similar governmental charge payable upon exchanges pursuant to Sections 3.06, 4.06, 4.08 and 9.05 of this Indenture).

(iii) Prior to the due presentation for registration of transfer of any Security, the Issuers, the Trustee, a Paying Agent or the Registrar may deem and treat the person in whose name a Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest on such Security and for all other purposes whatsoever, whether or not such Security is overdue, and none of the Issuers, the Trustee, a Paying Agent or the Registrar shall be affected by notice to the contrary.

(iv) All Securities issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt and shall be entitled to the same benefits under this Indenture as the Securities surrendered upon such transfer or exchange.

(i) No Obligation of the Trustee.

(i) The Trustee shall have no responsibility or obligation to any beneficial owner of a Global Security, a member of, or a participant in the Depository or any other Person with respect to the accuracy of the records of the Depository or its nominee or of any participant or member thereof, with respect to any ownership interest in the Securities or with respect to the delivery to any participant, member, beneficial owner or other Person (other than the Depository) of any notice (including any notice of redemption or repurchase) or the payment of any amount, under or with respect to such Securities. All notices and communications to be given to the Holders and all payments to be made to the Holders under the Securities shall be given or made only to the registered Holders (which shall be the Depository or its nominee in the case of a Global Security). The rights of beneficial owners in any Global Security shall be exercised only through the Depository subject to the applicable rules and procedures of the Depository. The Trustee may rely and shall be fully protected in relying upon information furnished by the Depository with respect to its members, participants and any beneficial owners.

 

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(ii) The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among Depository participants, members or beneficial owners in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

(j) [INTENTIONALLY OMITTED].

(k) Transfers of Securities Held by Affiliates. Notwithstanding anything to the contrary in this Section 2.2 any certificate (i) evidencing a Security that has been transferred to an affiliate (as defined in Rule 405 of the Securities Act) of the Issuers, as evidenced by a notation on the certificate of transfer or certificate of exchange for such transfer or in the representation letter delivered in respect thereof, or (ii) evidencing a Security that has been acquired from an affiliate (other than by an affiliate) in a transaction or a chain of transactions not involving any public offering, as evidenced by a notation on the certificate of transfer or certificate of exchange for such transfer or in the representation letter delivered in respect thereof, shall, until one year after the last date on which either the Issuers or any affiliate of the Issuers was an owner of such Security, in each case, be in the form of a permanent Definitive Security and bear the Restricted Securities Legend subject to the restrictions in this Section 2.2. The Registrar shall retain copies of all letters, notices and other written communications received pursuant to this Section 2.2(k). The Issuers, in their sole cost and expense, shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable advance written notice to the Trustee.

 

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EXHIBIT A

[FORM OF FACE OF INITIAL SECURITY]

[Global Securities Legend]

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

[Restricted Securities Legend]

THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (i) (a) TO A PERSON WHO IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO NON-U.S. PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE ISSUER SO

REQUESTS), (ii) TO THE ISSUER, OR (iii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE. NO REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION PROVIDED BY RULE 144 FOR RESALE OF THE SECURITY EVIDENCED HEREBY.

[Temporary Regulation S Security Legend]

THE RIGHTS ATTACHING TO THIS REGULATION S GLOBAL SECURITY THAT IS A TEMPORARY SECURITY, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE SECURITY, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN).

Each Definitive Security shall bear the following additional legend:

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

 

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[FORM OF INITIAL SECURITY]

 

No.    $            

9% Senior Secured Second Lien Note due 2018

CUSIP No. 144A: 693492 AC4 / Reg S: U72209 AB2

ISIN No. 144A: US693492 AC45 / Reg S: USU72209 AB24

PINAFORE, LLC, a Delaware limited liability company (“Finance LLC”), and PINAFORE, INC., a Delaware corporation (“Finance Co” and together with Finance LLC, the “Issuers”) promise to pay to [                    ], or registered assigns, the principal sum of Dollars [or such greater or lesser amount as is indicated on the Schedule of Increases or Decreases in Global Security attached hereto]* on October 1, 2018.

Interest Payment Dates: April 1 and October 1.

Record Dates: March 15 and September 15.

Additional provisions of this Security are set forth on the other side of this Security.

IN WITNESS WHEREOF, the Issuers have caused this instrument to be duly executed.

 

PINAFORE, LLC
By:  

 

  Name:
  Title:
PINAFORE, INC.
By:  

 

  Name:
  Title:

Dated:

TRUSTEE’S CERTIFICATE OF

    AUTHENTICATION

WILMINGTON TRUST FSB,

    as Trustee, certifies that this is

 

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one of the Securities

referred to in the Indenture.

 

By:  

 

  Authorized Signatory

 

 

*/ 

If the Security is to be issued in global form, add the Global Securities Legend and the attachment from Exhibit A captioned “TO BE ATTACHED TO GLOBAL SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY.”

 

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[FORM OF REVERSE SIDE OF INITIAL SECURITY]

9% Senior Secured Second Lien Note due 2018

1. Interest

(a) PINAFORE, LLC, a Delaware limited liability company (“Finance LLC”), and PINAFORE, INC., a Delaware corporation (“Finance Co” and together with Finance LLC, the “Issuers”), promise to pay interest on the principal amount of this Security at the rate per annum shown above. The Issuers shall pay interest semiannually on April 1 and October 1 of each year, commencing April 1, 2011.a Interest on the Securities shall accrue from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid or duly provided for, from September 29, 2010a until the principal hereof is due. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. The Issuers shall pay interest on overdue principal at the rate borne by the Securities, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.

(b) Registration Rights Agreement. The Holder of this Security is entitled to the benefits of a Registration Rights Agreement, dated as of September 29, 2010, among the Issuers, the Note Guarantors and the Initial Purchasers.

2. Method of Payment

The Issuers shall pay interest on the Securities (except defaulted interest) to the Persons who are registered Holders at the close of business on the March 15 or September 15 next preceding the interest payment date even if Securities are canceled after the record date and on or before the interest payment date (whether or not a Business Day). The Holders must surrender Securities to a Paying Agent to collect principal payments. The Issuers shall pay principal, premium, if any, and interest in money of the United States of America that at the time of payment is legal tender for payment of public and private debts. Payments in respect of the Securities represented by a Global Security (including principal, premium, if any, and interest) shall be made by wire transfer of immediately available funds to the accounts specified by The Depository Trust Company or any successor depositary. The Issuers will make all payments in respect of a certificated Security (including principal, premium, if any, and interest), at the office of each Paying Agent, except that, at the option of the Issuers, payment of interest may be made by mailing a check to the registered address of each Holder thereof; provided, however, that payments on the Securities may also be made, in the case of a Holder of at least $1,000,000 aggregate principal amount of Securities, by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or a Paying Agent to such effect designating such account no later

 

 

a 

With respect to Securities issued on the Issue Date.

 

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than 30 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).

3. Paying Agent and Registrar

Initially, Wilmington Trust FSB (the “Trustee”) will act as Paying Agent and Registrar. The Issuers may appoint and change any Paying Agent or Registrar without notice. The Issuers or any of its domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent or Registrar.

4. Indenture

The Issuers issued the Securities under an Indenture dated as of September 29, 2010 (the “Indenture”), among the Issuers, the Note Guarantors and the Trustee. The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date of the Indenture (the “TIA”). Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The Securities are subject to all terms and provisions of the Indenture, and the Holders are referred to the Indenture and the TIA for a statement of such terms and provisions. To the extent any provision of this Security conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.

The Securities are senior secured obligations of the Issuers. This Security is one of the Initial Securities referred to in the Indenture. The Securities include the Initial Securities and any Exchange Securities issued in exchange for Initial Securities pursuant to the Indenture. The Initial Securities and any Exchange Securities are treated as a single class of securities under the Indenture. The Indenture imposes certain limitations on the ability of the Issuers and their Restricted Subsidiaries to, among other things, make certain Investments and other Restricted Payments, pay dividends and other distributions, incur Indebtedness, enter into consensual restrictions upon the payment of certain dividends and distributions by such Restricted Subsidiaries, issue or sell shares of capital stock of the Issuers and such Restricted Subsidiaries, enter into or permit certain transactions with Affiliates, create or incur Liens and make Asset Sales. The Indenture also imposes limitations on the ability of the Issuers and each Note Guarantor to consolidate or merge with or into any other Person or convey, transfer or lease all or substantially all of its property.

To guarantee the due and punctual payment of the principal, premium, if any, and interest, on the Securities and all other amounts payable by the Issuers under the Indenture and the Securities when and as the same shall be due and payable, whether at maturity, by acceleration or otherwise, according to the terms of the Securities and the Indenture, the Note Guarantors have, jointly and severally, irrevocably and unconditionally guaranteed the Guaranteed Obligations on a senior secured basis pursuant to the terms of the Indenture.

5. Optional Redemption

Except as set forth in the following two paragraphs, the Securities shall not be redeemable at the option of the Issuers prior to October 1, 2014. Thereafter, the Securities shall be

 

A-6

redeemable at the option of the Issuers, in whole at any time or in part from time to time, upon not less than 30 nor more than 60 days’ prior notice mailed by first class mail to each Holder’s registered address or otherwise in accordance with the procedures of DTC, at the following redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest, to the redemption date (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the 12-month period commencing on October 1 of the years set forth below:

 

Year

    Redemption Price  

2014

      104.500 % 

2015

      102.250 % 

2016 and thereafter

      100.000 % 

In addition, at any time prior to October 1, 2014, the Issuers may redeem the Securities at its option, in whole at any time or in part from time to time, upon not less than 30 nor more than 60 days’ prior notice mailed by first class mail to each Holder’s registered address or otherwise in accordance with the procedures of DTC, at a redemption price equal to 100% of the principal amount of the Securities redeemed plus the Applicable Premium as of, and accrued and unpaid interest, to, the applicable redemption date (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date).

At any time, or from time to time prior to October 1, 2013, but not more than once in any twelve-month period, the Issuers may redeem up to 10% of the original aggregate principal amount of the Securities at a redemption price of 103% of the principal amount thereof plus accrued and unpaid interest thereon, if any, to but not including the date of redemption (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date).

Notwithstanding the foregoing, at any time and from time to time on or prior to October 1, 2013, the Issuers may redeem in the aggregate up to 35% of the original aggregate principal amount of the Securities (calculated after giving effect to any issuance of Additional Securities) with the net cash proceeds of one or more Equity Offerings (1) by Holdings or (2) by any direct or indirect parent of Holdings, in each case, to the extent the net cash proceeds thereof are contributed to the common or preferred equity capital (other than Disqualified Stock) of Holdings or the Issuers or used to purchase Capital Stock (other than Disqualified Stock) of Holdings from it, at a redemption price (expressed as a percentage of the principal amount thereof) of 109.000% plus accrued and unpaid interest, if any, to the redemption date (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date); provided, however, that at least 65% of the original aggregate principal amount of the Securities (calculated after giving effect to any issuance of Additional Securities) must remain outstanding after each such redemption; and provided, further, that such redemption shall occur within 90 days after the date on which any such Equity Offering is consummated upon not less than 30 nor more than 60 days’ notice mailed to each Holder of Securities being redeemed and otherwise in accordance with the procedures set forth in the Indenture.

 

A-7

In connection with any redemption of Securities (including with the net proceeds of any Equity Offering), any such redemption may, at the Issuers’ discretion, be subject to one or more conditions precedent, including any related Equity Offering. In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice shall state that, in the Issuers’ discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the redemption date, or by the redemption date so delayed.

6. Sinking Fund

The Securities are not subject to any sinking fund.

7. Notice of Redemption

Notice of redemption will be mailed by first-class mail at least 30 days but not more than 60 days before the redemption date to each Holder of Securities to be redeemed at his, her or its registered address or otherwise in accordance with the procedures of The Depository Trust Company. Securities in denominations larger than $2,000 may be redeemed in part but only in whole multiples of $1,000 to the extent practicable. If money sufficient to pay the redemption price of and accrued and unpaid interest on all Securities (or portions thereof) to be redeemed on the redemption date is deposited with a Paying Agent on or before the redemption date and certain other conditions are satisfied, on and after such redemption date, interest ceases to accrue on such Securities (or such portions thereof) called for redemption.

8. Repurchase of Securities at the Option of the Holders upon Change of Control and Asset Sales

Upon the occurrence of a Change of Control, each Holder shall have the right, subject to certain conditions specified in the Indenture, to cause the Issuers to repurchase all or any part of such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of repurchase (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date), as provided in, and subject to the terms of, the Indenture.

In accordance with Section 4.06 of the Indenture, the Issuers will be required to offer to purchase Securities upon the occurrence of certain events.

9. Denominations; Transfer; Exchange

The Securities are in registered form, without coupons, in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. A Holder shall register the transfer of or exchange of Securities in accordance with the Indenture. Upon any registration of transfer or exchange, the Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes required by law or permitted by the Indenture. The Registrar need not register the transfer of or exchange any Securities selected for redemption (except, in the case of a Security to be redeemed in part, the portion of

 

A-8

the Security not to be redeemed) or to transfer or exchange any Securities for a period of 15 days prior to a selection of Securities to be redeemed.

10. Persons Deemed Owners

The registered Holder of this Security shall be treated as the owner of it for all purposes.

11. Unclaimed Money

If money for the payment of principal or interest remains unclaimed for two years, the Trustee and a Paying Agent shall pay the money back to the Issuers at its written request unless an abandoned property law designates another Person. After any such payment, the Holders entitled to the money must look to the Issuers for payment as general creditors and the Trustee and a Paying Agent shall have no further liability with respect to such monies.

12. Discharge and Defeasance

Subject to certain conditions, the Issuers at any time may terminate some of or all its obligations under the Securities and the Indenture if the Issuers deposit with the Trustee money or U.S. Government Obligations for the payment of principal of, and interest on the Securities to redemption, or maturity, as the case may be.

13. Amendment, Waiver

Subject to certain exceptions set forth in the Indenture, (i) the Indenture, the Securities, the Note Guarantees, any Collateral Document or the Second Lien Intercreditor Agreement may be amended with the written consent of the Holders of at least a majority in aggregate principal amount of the outstanding Securities (voting as a single class) and (ii) any default or compliance with any provisions may be waived with the written consent of the Holders of at least a majority in principal amount of the outstanding Securities. Subject to certain exceptions set forth in the Indenture, without the consent of any Holder, the Issuers and the Trustee may amend the Indenture, the Securities, the Note Guarantees, any Collateral Document or the Second Lien Intercreditor Agreement (i) to cure any ambiguity, omission, defect or inconsistency; (ii) to conform the text of the Indenture, the Note Guarantees or the Securities to any provision under the heading “Description of Notes” in the Offering Memorandum to the extent that such provision was intended to be a verbatim recitation of a provision of the Indenture, the Note Guarantees or the Securities; (iii) to comply with Article 5 of the Indenture; (iv) to provide for uncertificated Securities in addition to or in place of certificated Securities; (v) to add additional Note Guarantees with respect to the Securities or to secure the Securities; (vi) to add to the covenants of the Issuers for the benefit of the Holders or to surrender any right or power conferred in the Indenture upon the Issuers; (vii) to comply with the requirements of the SEC in order to effect or maintain the qualification of the Indenture under the TIA; (viii) to make any change that does not adversely affect the rights of any Holder; or (ix) to provide for the issuance of the Exchange Securities or Additional Securities.

 

A-9

14. Defaults and Remedies

If an Event of Default occurs (other than an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Issuers) and is continuing, the Trustee or the Holders of at least 25% in principal amount of the outstanding Securities, in each case, by written notice to the Issuers, may declare the principal of, premium, if any, and accrued but unpaid interest on all the Securities to be due and payable. If an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Issuers occurs, the principal of, premium, if any, and interest on all the Securities shall become immediately due and payable without any declaration or other act on the part of the Trustee or any Holders. Under certain circumstances, the Holders of a majority in principal amount of the outstanding Securities may rescind any such acceleration with respect to the Securities and its consequences.

If an Event of Default occurs and is continuing, the Trustee shall be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity or security satisfactory to it against any loss, liability or expense and certain other conditions are complied with. Except to enforce the right to receive payment of principal, premium (if any) or interest when due, no Holder may pursue any remedy with respect to the Indenture or the Securities unless (i) such Holder has previously given the Trustee notice that an Event of Default is continuing, (ii) the Holders of at least 25% in principal amount of the outstanding Securities have requested the Trustee in writing to pursue the remedy, (iii) such Holders have offered the Trustee reasonable security or indemnity against any loss, liability or expense, (iv) the Trustee has not complied with such request within 60 days after the receipt of the request and the offer of security or indemnity and (v) the Holders of a majority in principal amount of the outstanding Securities have not given the Trustee a direction inconsistent with such request within such 60-day period. Subject to certain restrictions, the Holders of a majority in principal amount of the outstanding Securities are given the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. The Trustee, however, may refuse to follow any direction that conflicts with law or the Indenture or that the Trustee determines is unduly prejudicial to the rights of any other Holder or that would involve the Trustee in personal liability. Prior to taking any action under the Indenture, the Trustee shall be entitled to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.

15. Trustee Dealings with the Issuers

Subject to certain limitations imposed by the TIA, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Issuers or their Affiliates and may otherwise deal with the Issuers or their Affiliates with the same rights it would have if it were not Trustee.

16. No Recourse Against Others

No director, officer, employee, incorporator or holder of any equity interests in the Issuers or of any Note Guarantor or any direct or indirect parent, as such, shall have any

 

A-10

liability for any obligations of the Issuers or the Note Guarantors under the Securities, the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Securities by accepting a Security waives and releases all such liability.

17. Authentication

This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Security.

18. Abbreviations

Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act).

19. Governing Law

THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

20. CUSIP Numbers, ISINs and Common Codes

The Issuers have caused CUSIP numbers and ISINs to be printed on the Securities and has directed the Trustee to use CUSIP numbers and ISINs. No representation is made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.

The Issuers will furnish to any Holder of Securities upon written request and without charge to the Holder a copy of the Indenture which has in it the text of this Security.

 

A-11

ASSIGNMENT FORM

To assign this Security, fill in the form below:

I or we assign and transfer this Security to:

 

 

(Print or type assignee’s name, address and zip code)

 

 

(Insert assignee’s soc. sec. or tax I.D. No.)

and irrevocably appoint agent to transfer this Security on the books of the Issuers. The agent may substitute another to act for him.

 

 

 

Date:                              Your Signature:   

 

 

 

Sign exactly as your name appears on the other side of this Security.

Signature Guarantee:

 

Date:  

 

      

 

  Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor program reasonably acceptable to the Trustee       Signature of Signature Guarantee

 

A-12

CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR

REGISTRATION OF TRANSFER RESTRICTED SECURITIES

This certificate relates to $         principal amount of Securities held in (check applicable space)              book-entry or              definitive form by the undersigned.

The undersigned:

 

¨    has requested the Trustee by written order to deliver in exchange for its beneficial interest in the Global Security held by the Depository a Security or Securities in definitive, registered form of authorized denominations and an aggregate principal amount equal to its beneficial interest in such Global Security (or the portion thereof indicated above); and
      check the following, if applicable:
      ¨    is an affiliate of the Issuers as contemplated in Section 2.2(k) of Appendix A to the Indenture; or
      ¨    is exchanging this Security in connection with an expected transfer to an affiliate of the Issuers as contemplated in Section 2.2(k) of Appendix A to the Indenture.
¨    has requested the Trustee by written order to exchange or register the transfer of a Security or Securities; and
      check the following, if applicable:
      ¨    is an affiliate of the Issuers as contemplated in Section 2.2(k) of Appendix A to the Indenture; or
      ¨    the transferee is an affiliate of the Issuers as contemplated in Section 2.2(k) of Appendix A to the Indenture.

 

In connection with any transfer of any of the Securities evidenced by this certificate occurring prior to the expiration of the period referred to in Rule 144 under the Securities Act, the undersigned confirms that such Securities are being transferred in accordance with its terms:

 

CHECK ONE BOX BELOW

   (1)    ¨    to the Issuers; or
   (2)    ¨    to the Registrar for registration in the name of the Holder, without transfer; or
   (3)    ¨    pursuant to an effective registration statement under the Securities Act of 1933; or

 

A-13

  (4)    ¨    inside the United States to a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act of 1933) that purchases for its own account or for the account of a qualified institutional buyer to whom notice is given that such transfer is being made in reliance on Rule 144A, in each case pursuant to and in compliance with Rule 144A under the Securities Act of 1933; or
  (5)    ¨    outside the United States in an offshore transaction within the meaning of Regulation S under the Securities Act in compliance with Rule 904 under the Securities Act of 1933 and such Security shall be held immediately after the transfer through Euroclear or Clearstream until the expiration of the Restricted Period (as defined in the Indenture); or
  (6)    ¨    to an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933) that has furnished to the Trustee a signed letter containing certain representations and agreements; or
  (7)    ¨    pursuant to another available exemption from registration provided by Rule 144 under the Securities Act of 1933.

Unless one of the boxes is checked, the Trustee will refuse to register any of the Securities evidenced by this certificate in the name of any Person other than the registered Holder thereof; provided, however, that if box (5), (6) or (7) is checked, the Trustee may require, prior to registering any such transfer of the Securities, such legal opinions, certifications and other information as the Issuers have reasonably requested to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933.

 

Date:                           

 

      Your Signature

Signature Guarantee:

 

Date:  

 

      

 

  Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor program reasonably acceptable to the Trustee       Signature of Signature Guarantee

 

 

TO BE COMPLETED BY PURCHASER IF (4) ABOVE IS CHECKED.

The undersigned represents and warrants that it is purchasing this Security for its own account or an account with respect to which it exercises sole investment discretion and that

 

A-14

it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act of 1933, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Issuers as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned’s foregoing representations in order to claim the exemption from registration provided by Rule 144A.

 

  Dated:                            

 

   
         NOTICE:  To be executed by an executive officer   

 

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[TO BE ATTACHED TO GLOBAL SECURITIES]

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

The initial principal amount of this Global Security is set forth on the face hereof. The following increases or decreases in this Global Security have been made:

 

Date of

Exchange

  

Amount of decrease

in Principal Amount

of this Global

Security

  

Amount of increase in

Principal Amount of

this Global Security

  

Principal amount of this

Global Security following

such decrease or increase

   Signature of authorized
signatory of Trustee or
Securities Custodian

 

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OPTION OF HOLDER TO ELECT PURCHASE

If you want to elect to have this Security purchased by the Issuers pursuant to Section 4.06 (Asset Sale) or 4.08 (Change of Control) of the Indenture, check the box:

Asset Sale  ¨             Change of Control  ¨

If you want to elect to have only part of this Security purchased by the Issuers pursuant to Section 4.06 (Asset Sale) or 4.08 (Change of Control) of the Indenture, state the amount ($2,000 and any integral multiples of $1,000 in excess thereof):

$        

 

Date:                          Your Signature:  

 

      (Sign exactly as your name appears on the other side of this Security)

Signature Guarantee:                                         

Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor program reasonably acceptable to the Trustee

 

A-17

EXHIBIT B

[FORM OF FACE OF EXCHANGE SECURITY]

[Global Securities Legend]

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

No.

    $        

[FORM OF EXCHANGE SECURITY]

9% Senior Secured Second Lien Note due 2018

CUSIP No.        

ISIN No.            

PINAFORE, LLC, a Delaware limited liability company (“Finance LLC”), and PINAFORE, INC., a Delaware corporation (“Finance Co” and together with Finance LLC, the “Issuers”) promise to [                            ], or registered assigns, the principal sum of Dollars [or such greater or lesser amount as is indicated on the Schedule of Increases or Decreases in Global Security attached hereto]* on October 1, 2018.

Interest Payment Dates: April 1 and October 1.

Record Dates: March 15 and September 15.

Additional provisions of this Security are set forth on the other side of this Security.

IN WITNESS WHEREOF, the Issuers have caused this instrument to be duly executed.

 

PINAFORE, LLC
By:  

 

  Name:  
  Title:  
PINAFORE, INC.
By:  

 

  Name:  
  Title:  

Dated:

 

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TRUSTEE’S CERTIFICATE OF AUTHENTICATION

WILMINGTON TRUST FSB,
as Trustee, certifies that this is one of the Securities referred to in the Indenture.

By:

  

 

 

Authorized Signatory

 

 

*/ If the Security is to be issued in global form, add the Global Securities Legend and the attachment from Exhibit A captioned “TO BE ATTACHED TO GLOBAL SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY.”

 

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[FORM OF REVERSE SIDE OF EXCHANGE SECURITY]

9% Senior Secured Second Lien Note due 2018

1. Interest

PINAFORE, LLC, a Delaware limited liability company (“Finance LLC”), and PINAFORE, INC., a Delaware corporation (“Finance Co” and together with Finance LLC, the “Issuers”) promise to pay interest on the principal amount of this Security at the rate per annum shown above. The Issuers shall pay interest semiannually on April 1 and October 1 of each year, commencing April 1, 2011.a Interest on the Securities shall accrue from the most recent date to which interest has been paid or duly provided for or, if no interest has been paid or duly provided for, from September 29, 2010a until the principal hereof is due. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. The Issuers shall pay interest on overdue principal at the rate borne by the Securities, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.

2. Method of Payment

The Issuers shall pay interest on the Securities (except defaulted interest) to the Persons who are registered Holders at the close of business on the March 15 or September 15 next preceding the interest payment date even if Securities are canceled after the record date and on or before the interest payment date (whether or not a Business Day). The Holders must surrender Securities to a Paying Agent to collect principal payments. The Issuers shall pay principal, premium, if any, and interest in money of the United States of America that at the time of payment is legal tender for payment of public and private debts. Payments in respect of the Securities represented by a Global Security (including principal, premium, if any, and interest) shall be made by wire transfer of immediately available funds to the accounts specified by The Depository Trust Company or any successor depositary. The Issuers will make all payments in respect of a certificated Security (including principal, premium, if any, and interest), at the office of a Paying Agent, except that, at the option of the Issuers, payment of interest may be made by mailing a check to the registered address of each Holder thereof; provided, however, that payments on the Securities may also be made, in the case of a Holder of at least $1,000,000 aggregate principal amount of Securities, by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or a Paying Agent to such effect designating such account no later than 30 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).

 

 

a 

With respect to Securities issued on the Issue Date.

 

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3. Paying Agent and Registrar

Initially, Wilmington Trust FSB (the “Trustee”) will act as Paying Agent and Registrar. The Issuers may appoint and change any Paying Agent or Registrar without notice. The Issuers or any of its domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent or Registrar.

4. Indenture

The Issuers issued the Securities under an Indenture dated as of September 29, 2010 (the “Indenture”), among the Issuers, the Note Guarantors and the Trustee. The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date of the Indenture (the “TIA”). Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The Securities are subject to all terms and provisions of the Indenture, and the Holders are referred to the Indenture and the TIA for a statement of such terms and provisions. To the extent any provision of this Security conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.

The Securities are senior secured obligations of the Issuers. This Security is one of the Exchange Securities referred to in the Indenture. The Securities include the Initial Securities, the Additional Securities and any Exchange Securities issued in exchange for the Initial Securities pursuant to the Indenture. The Initial Securities and Exchange Securities are treated as a single class of securities under the Indenture. The Indenture imposes certain limitations on the ability of the Issuers and its Restricted Subsidiaries to, among other things, make certain Investments and other Restricted Payments, pay dividends and other distributions, incur Indebtedness, enter into consensual restrictions upon the payment of certain dividends and distributions by such Restricted Subsidiaries, issue or sell shares of capital stock of the Issuers and such Restricted Subsidiaries, enter into or permit certain transactions with Affiliates, create or incur Liens and make Asset Sales. The Indenture also imposes limitations on the ability of the Issuers and each Note Guarantor to consolidate or merge with or into any other Person or convey, transfer or lease all or substantially all of its property.

To guarantee the due and punctual payment of the principal, premium, if any, and interest on the Securities and all other amounts payable by the Issuers under the Indenture and the Securities when and as the same shall be due and payable, whether at maturity, by acceleration or otherwise, according to the terms of the Securities and the Indenture, the Note Guarantors have, jointly and severally, irrevocably and unconditionally guaranteed the Guaranteed Obligations on a senior secured basis pursuant to the terms of the Indenture.

5. Optional Redemption

Except as set forth in the following two paragraphs, the Securities shall not be redeemable at the option of the Issuers prior to October 1, 2014. Thereafter, the Securities shall be redeemable at the option of the Issuers, in whole at any time or in part from time to time, upon not less than 30 nor more than 60 days’ prior notice mailed by first class mail to each Holder’s registered address or otherwise in accordance with the procedures of DTC, at the following

 

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redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest, to the redemption date (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the 12-month period commencing on October 1 of the years set forth below:

 

Year

    Redemption Price  

2014

      104.500 % 

2015

      102.250 % 

2016 and thereafter

      100.000 % 

In addition, at any time prior to October 1, 2014, the Issuers may redeem the Securities at its option, in whole at any time or in part from time to time, upon not less than 30 nor more than 60 days’ prior notice mailed by first class mail to each Holder’s registered address or otherwise in accordance with the procedures of DTC, at a redemption price equal to 100% of the principal amount of the Securities redeemed plus the Applicable Premium as of, and accrued and unpaid interest, to, the applicable redemption date (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date).

At any time, or from time to time prior to October 1, 2013, but not more than once in any twelve-month period, the Issuers may redeem up to 10% of the original aggregate principal amount of the Securities at a redemption price of 103% of the principal amount thereof plus accrued and unpaid interest thereon, if any, to but not including the date of redemption (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date).

Notwithstanding the foregoing, at any time and from time to time on or prior to October 1, 2013, the Issuers may redeem in the aggregate up to 35% of the original aggregate principal amount of the Securities (calculated after giving effect to any issuance of Additional Securities) with the net cash proceeds of one or more Equity Offerings (1) by Holdings or (2) by any direct or indirect parent of [Holdings] in each case, to the extent the net cash proceeds thereof are contributed to the common or preferred equity capital (other than Disqualified Stock) of Holdings or the Issuers or used to purchase Capital Stock (other than Disqualified Stock) of Holdings from it, at a redemption price (expressed as a percentage of the principal amount thereof) of 109.000% plus accrued and unpaid interest, if any, to the redemption date (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date); provided, however, that at least 65% of the original aggregate principal amount of the Securities (calculated after giving effect to any issuance of Additional Securities) must remain outstanding after each such redemption; and provided, further, that such redemption shall occur within 90 days after the date on which any such Equity Offering is consummated upon not less than 30 nor more than 60 days’ notice mailed to each Holder of Securities being redeemed and otherwise in accordance with the procedures set forth in the Indenture.

In connection with any redemption of Securities (including with the net proceeds of any Equity Offering), any such redemption may, at the Issuers’ discretion, be subject to one or more conditions precedent, including any related Equity Offering. In addition, if such

 

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redemption or notice is subject to satisfaction of one or more conditions precedent, such notice shall state that, in the Issuers’ discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the redemption date, or by the redemption date so delayed.

6. Sinking Fund

The Securities are not subject to any sinking fund.

7. Notice of Redemption

Notice of redemption will be mailed by first-class mail at least 30 days but not more than 60 days before the redemption date to each Holder of Securities to be redeemed at his, her or its registered address or otherwise in accordance with the procedures of The Depository Trust Company. Securities in denominations larger than $2,000 may be redeemed in part but only in whole multiples of $1,000 to the extent practicable . If money sufficient to pay the redemption price of and accrued and unpaid interest on all Securities (or portions thereof) to be redeemed on the redemption date is deposited with a Paying Agent on or before the redemption date and certain other conditions are satisfied, on and after such date interest ceases to accrue on such Securities (or such portions thereof) called for redemption.

8. Repurchase of Securities at the Option of the Holders upon Change of Control and Asset Sales

Upon the occurrence of a Change of Control, each Holder shall have the right, subject to certain conditions specified in the Indenture, to cause the Issuers to repurchase all or any part of such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of repurchase (subject to the right of the Holders of record on the relevant record date to receive interest due on the relevant interest payment date), as provided in, and subject to the terms of, the Indenture.

In accordance with Section 4.06 of the Indenture, the Issuers will be required to offer to purchase Securities upon the occurrence of certain events.

9. Denominations; Transfer; Exchange

The Securities are in registered form without coupons in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. A Holder shall register the transfer of or exchange of Securities in accordance with the Indenture. Upon any registration of transfer or exchange, the Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes required by law or permitted by the Indenture. The Registrar need not register the transfer of or exchange any Securities selected for redemption (except, in the case of a Security to be redeemed in part, the portion of the Security not to be redeemed) or to transfer or exchange any Securities for a period of 15 days prior to a selection of Securities to be redeemed.

 

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10. Persons Deemed Owners

The registered Holder of this Security shall be treated as the owner of it for all purposes.

11. Unclaimed Money

If money for the payment of principal or interest remains unclaimed for two years, the Trustee and a Paying Agent shall pay the money back to the Issuers at its written request unless an abandoned property law designates another Person. After any such payment, the Holders entitled to the money must look to the Issuers for payment as general creditors and the Trustee and a Paying Agent shall have no further liability with respect to such monies.

12. Discharge and Defeasance

Subject to certain conditions, the Issuers at any time may terminate some of or all its obligations under the Securities and the Indenture if the Issuers deposit with the Trustee money or U.S. Government Obligations for the payment of principal of and interest on the Securities to redemption, or maturity, as the case may be.

13. Amendment, Waiver

Subject to certain exceptions set forth in the Indenture, (i) the Indenture, the Securities, the Note Guarantees, any Collateral Document or the Second Lien Intercreditor Agreement may be amended with the written consent of the Holders of at least a majority in aggregate principal amount of the outstanding Securities (voting as a single class) and (ii) any default or compliance with any provisions may be waived with the written consent of the Holders of at least a majority in principal amount of the outstanding Securities. Subject to certain exceptions set forth in the Indenture, without the consent of any Holder, the Issuers and the Trustee may amend the Indenture, the Securities, the Note Guarantees, any Collateral Document or the Second Lien Intercreditor Agreement (i) to cure any ambiguity, omission, defect or inconsistency; (ii) to conform the text of the Indenture, the Note Guarantees or the Securities to any provision under the heading “Description of Notes” in the Offering Memorandum to the extent that such provision was intended to be a verbatim recitation of a provision of the Indenture, the Note Guarantees or the Securities; (iii) to comply with Article 5 of the Indenture; (iv) to provide for uncertificated Securities in addition to or in place of certificated Securities; (v) to add additional Note Guarantees with respect to the Securities or to secure the Securities; (vi) to add to the covenants of the Issuers for the benefit of the Holders or to surrender any right or power conferred in the Indenture upon the Issuers; (vii) to comply with the requirements of the SEC in order to effect or maintain the qualification of the Indenture under the TIA; (viii) to make any change that does not adversely affect the rights of any Holder; or (ix) to provide for the issuance of the Exchange Securities or Additional Securities.

14. Defaults and Remedies

If an Event of Default occurs (other than an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Issuers) and is continuing, the Trustee

 

B-8

or the Holders of at least 25% in principal amount of the outstanding Securities, in each case, by written notice to the Issuers, may declare the principal of, premium, if any, and accrued but unpaid interest on all the Securities to be due and payable. If an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Issuers occurs, the principal of, premium, if any, and interest on all the Securities shall become immediately due and payable without any declaration or other act on the part of the Trustee or any Holders. Under certain circumstances, the Holders of a majority in principal amount of the outstanding Securities may rescind any such acceleration with respect to the Securities and its consequences.

If an Event of Default occurs and is continuing, the Trustee shall be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity or security satisfactory to it against any loss, liability or expense and certain other conditions are complied with. Except to enforce the right to receive payment of principal, premium (if any) or interest when due, no Holder may pursue any remedy with respect to the Indenture or the Securities unless (i) such Holder has previously given the Trustee notice that an Event of Default is continuing, (ii) the Holders of at least 25% in principal amount of the outstanding Securities have requested the Trustee in writing to pursue the remedy, (iii) such Holders have offered the Trustee reasonable security or indemnity against any loss, liability or expense, (iv) the Trustee has not complied with such request within 60 days after the receipt of the request and the offer of security or indemnity and (v) the Holders of a majority in principal amount of the outstanding Securities have not given the Trustee a direction inconsistent with such request within such 60-day period. Subject to certain restrictions, the Holders of a majority in principal amount of the outstanding Securities are given the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. The Trustee, however, may refuse to follow any direction that conflicts with law or the Indenture or that the Trustee determines is unduly prejudicial to the rights of any other Holder or that would involve the Trustee in personal liability. Prior to taking any action under the Indenture, the Trustee shall be entitled to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action.

15. Trustee Dealings with the Issuers

Subject to certain limitations imposed by the TIA, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Issuers or their Affiliates and may otherwise deal with the Issuers or their Affiliates with the same rights it would have if it were not Trustee.

16. No Recourse Against Others

No director, officer, employee, incorporator or holder of any equity interests in the Issuers or of any Note Guarantor or any direct or indirect parent, as such, shall have any liability for any obligations of the Issuers or the Note Guarantors under the Securities, the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Securities by accepting a Security waives and releases all such liability.

 

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17. Authentication

This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of authentication on the other side of this Security.

18. Abbreviations

Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act).

19. Governing Law

THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

20. CUSIP Numbers, ISINs and Common Codes

The Issuers have caused CUSIP numbers and ISINs to be printed on the Securities and has directed the Trustee to use CUSIP numbers and ISINs. No representation is made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.

The Issuers will furnish to any Holder of Securities upon written request and without charge to the Holder a copy of the Indenture which has in it the text of this Security.

 

B-10

ASSIGNMENT FORM

To assign this Security, fill in the form below:

I or we assign and transfer this Security to:

 

 

(Print or type assignee’s name, address and zip code)

 

 

(Insert assignee’s soc. sec. or tax I.D. No.)

and irrevocably appoint                              agent to transfer this Security on the books of the Issuers. The agent may substitute another to act for him.

 

 

 

Date:                             Your Signature:   

 

          Sign exactly as your name appears on the other side of this Security.
         

Signature Guarantee:

 

Date:  

 

      

 

  Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor program reasonably acceptable to the Trustee       Signature of Signature Guarantee

 

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OPTION OF HOLDER TO ELECT PURCHASE

If you want to elect to have this Security purchased by the Issuers pursuant to Section 4.06 (Asset Sale) or 4.08 (Change of Control) of the Indenture, check the box:

Asset Sale  ¨             Change of Control  ¨

If you want to elect to have only part of this Security purchased by the Issuers pursuant to Section 4.06 (Asset Sale) or 4.08 (Change of Control) of the Indenture, state the amount ($2,000 and any integral multiples of $1,000 in excess thereof):

$        

 

Date:                          Your Signature:  

 

      (Sign exactly as your name appears on the other side of this Security)

 

Signature Guarantee:     

 

     Signature must be guaranteed by a participant in a recognized signature guaranty medallion program or other signature guarantor program reasonably acceptable to the Trustee.

 

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[TO BE ATTACHED TO GLOBAL SECURITIES]

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

The initial principal amount of this Global Security is set forth on the face hereof. The following increases or decreases in this Global Security have been made:

 

Date of

Exchange

  

Amount of decrease

in Principal Amount

of this Global

Security

  

Amount of increase in

Principal Amount of

this Global Security

  

Principal amount of this

Global Security following

such decrease or increase

  

Signature of authorized
signatory of Trustee or
Securities Custodian

 

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EXHIBIT C

Form of

Transferee Letter of Representation

Pinafore, LLC

Pinafore, Inc.

c/o Wilmington Trust FSB

246 Goose Lane, Suite 105

Guilford, CT 06437

Ladies and Gentlemen:

This certificate is delivered to request a transfer of $[        ] principal amount of the 9% Senior Secured Second Lien Notes due 2018 (the “Securities”) of PINAFORE, LLC and PINAFORE, INC. (the “Issuers”).

Upon transfer, the Securities would be registered in the name of the new beneficial owner as follows:

Name:                             

Address:                             

Taxpayer ID Number:                     

The undersigned represents and warrants to you that:

1. We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the “Securities Act”)), purchasing for our own account or for the account of such an institutional “accredited investor” at least $250,000 principal amount of the Securities, and we are acquiring the Securities not with a view to, or for offer or sale in connection with, any distribution in violation of the Securities Act. We have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Securities, and we invest in or purchase securities similar to the Securities in the normal course of our business. We, and any accounts for which we are acting, are each able to bear the economic risk of our or its investment.

2. We understand that the Securities have not been registered under the Securities Act and, unless so registered, may not be sold except as permitted in the following sentence. We agree on our own behalf and on behalf of any investor account for which we are purchasing Securities to offer, sell or otherwise transfer such Securities prior to the date that is one year after the later of the date of original issue and the last date on which the Issuers or any affiliate of the Issuers was the owner of such Securities (or any predecessor thereto) (the “Resale Restriction Termination Date”) only (a) to the Issuers, (b) pursuant to a registration statement that has been declared effective under the Securities Act, (c) in a transaction complying with the

requirements of Rule 144A under the Securities Act (“Rule 144A”), to a person we reasonably believe is a qualified institutional buyer under Rule 144A (a “QIB”) that is purchasing for its own account or for the account of a QIB and to whom notice is given that the transfer is being made in reliance on Rule 144A, (d) pursuant to offers and sales that occur outside the United States within the meaning of Regulation S under the Securities Act, (e) to an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is purchasing for its own account or for the account of such an institutional “accredited investor,” in each case in a minimum principal amount of Securities of $250,000, or (f) pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the foregoing cases to any requirement of law that the disposition of our property or the property of such investor account or accounts be at all times within our or their control and in compliance with any applicable state securities laws. The foregoing restrictions on resale will not apply subsequent to the Resale Restriction Termination Date. If any resale or other transfer of the Securities is proposed to be made pursuant to clause (e) above prior to the Resale Restriction Termination Date, the transferor shall deliver a letter from the transferee substantially in the form of this letter to the Issuers and the Trustee, which shall provide, among other things, that the transferee is an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act and that it is acquiring such Securities for investment purposes and not for distribution in violation of the Securities Act. Each purchaser acknowledges that the Issuers and the Trustee reserve the right prior to the offer, sale or other transfer prior to the Resale Restriction Termination Date of the Securities pursuant to clause (d), (e) or (f) above to require the delivery of an opinion of counsel, certifications or other information satisfactory to the Issuers and the Trustee.

 

Dated:                         TRANSFEREE:                                                        ,

 

by  

 

 

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EXHIBIT D

[FORM OF SUPPLEMENTAL INDENTURE]

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) dated as of [                    ], among [GUARANTOR] (the “New Guarantor”), a subsidiary of [Pinafore Holdings B.V.] (or its successor) (“Holdings”), and WILMINGTON TRUST FSB, as trustee under the indenture referred to below (the “Trustee”).

W I T N E S S E T H :

WHEREAS the Issuers and the existing Note Guarantors have heretofore executed and delivered to the Trustee an Indenture (as amended, supplemented or otherwise modified, the “Indenture”) dated as of September 29, 2010, providing for the issuance of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”), initially in the aggregate principal amount of $1,150,000,000;

WHEREAS Section 4.10 of the Indenture provides that under certain circumstances Holdings is required to cause the New Guarantor to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the Issuers’ obligations under the Securities pursuant to a Note Guarantee on the terms and conditions set forth herein; and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and the Issuers are authorized to execute and deliver this Supplemental Indenture;

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantor, Holdings, the Issuers, and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

1. Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined, except that the term “Holders” in this Note Guarantee shall refer to the term “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The words “herein,” “hereof” and hereby and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

2. Agreement to Guarantee. The New Guarantor hereby agrees, jointly and severally with all existing Note Guarantors (if any), to unconditionally guarantee the Issuers’ obligations under the Securities on the terms and subject to the conditions set forth in Article 11 of the Indenture and to be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements of a Note Guarantor under the Indenture.

3. Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all

the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

4. Notices. All notices or other communications to the New Guarantor shall be given as provided in Section 12.02 of the Indenture.

5. Governing Law. THIS SUPPLEMENTAL INDENTURE (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

(a) Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Supplemental Indenture or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and subject to the last sentence of this Section 5(a) each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

(b) Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment, including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

D-2

(c) Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and the Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

6. Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.

7. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

8. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction thereof.

 

D-3

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

 

[NEW GUARANTOR]
By:  

 

  Name:  
  Title:  
PINAFORE, LLC
By:  

 

  Name:  
  Title:  
PINAFORE, INC.
By:  

 

  Name:  
  Title:  
WILMINGTON TRUST FSB, AS TRUSTEE
By:  

 

  Name:  
  Title:  

CERTIFICATE OF SERVICE

I, , certify that a copy of the foregoing was served on the , addressed as follows:

[TYPE THE RECIPIENT NAMES AND ADDRESSES AND DELIVERY METHODS HERE]

 

      
 EX-4.2 11 dex42.htm EXHIBIT 4.2 Exhibit 4.2

Exhibit 4.2

FIRST SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) dated as of November 18, 2010, among the entities set forth on Schedule I hereto (each a “New Guarantor”), each an indirect subsidiary of Pinafore Holdings B.V. (or its successor) (“Holdings”), and WILMINGTON TRUST FSB, as trustee under the indenture referred to below (the “Trustee”).

W I T N E S S E T H :

WHEREAS the Issuers and the existing Note Guarantors have heretofore executed and delivered to the Trustee an Indenture (as amended, supplemented or otherwise modified, the “Indenture”) dated as of September 29, 2010, providing for the issuance of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”), initially in the aggregate principal amount of $1,150,000,000;

WHEREAS Section 4.10 of the Indenture provides that under certain circumstances Holdings is required to cause the New Guarantors to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the Issuers’ obligations under the Securities pursuant to a Note Guarantee on the terms and conditions set forth herein; and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and the Issuers are authorized to execute and deliver this Supplemental Indenture;

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantors, Holdings, the Issuers, and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

 

  1. Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined, except that the term “Holders” in this Note Guarantee shall refer to the term “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The words “herein,” “hereof” and hereby and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

 

  2. Agreement to Guarantee. The New Guarantors hereby agree, jointly and severally with all existing Note Guarantors (if any), to unconditionally guarantee the Issuers’ obligations under the Securities on the terms and subject to the conditions set forth in Article 11 of the Indenture and to be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements of a Note Guarantor under the Indenture.

 

  3.

Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental

 

Indenture shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

 

  4. Notices. All notices or other communications to the New Guarantor shall be given as provided in Section 12.02 of the Indenture.

 

  5. Governing Law. THIS SUPPLEMENTAL INDENTURE (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

  a. Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Supplemental Indenture or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and subject to the last sentence of this Section 5(a) each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

 

  b.

Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment,

 

including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

  c. Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and the Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

 

  6. Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.

 

  7. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

 

  8. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction thereof.

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

 

TOMKINS MAURITIUS COMPANY LIMITED,
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Signatory
SCHRADER ELECTRONICS LIMITED,
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Signatory
ACD TRIDON INC., as New Guarantor
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Signatory
RUSKIN COMPANY CANADA INC., as New Guarantor
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Signatory
TOMKINS AUTOMOTIVE CANADA LIMITED,
as New Guarantor
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Signatory

PINAFORE, LLC
By:  

/s/ Donald West

Name:   Donald West
Title:   Chief Financial Officer
PINAFORE, INC.

/s/ Donald West

By:  
Name:   Donald West
Title:   Chief Financial Officer
WILMINGTON TRUST FSB, AS TRUSTEE

/s/ Joseph P. O’Donnell

By:  
Name:   Joseph P. O’Donnell
Title:   Vice President
WILMINGTON TRUST FSB, AS COLLATERAL AGENT

/s/ Joseph P. O’Donnell

By:  
Name:   Joseph P. O’Donnell
Title:   Vice President

SCHEDULE I

TOMKINS MAURITIUS COMPANY LIMITED

SCHRADER ELECTRONICS LIMITED

ACD TRIDON INC.

RUSKIN COMPANY CANADA INC.

TOMKINS AUTOMOTIVE CANADA LIMITED

EX-4.3 12 dex43.htm EXHIBIT 4.3 Exhibit 4.3

Exhibit 4.3

SECOND SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) dated as of December 21, 2010, among the entities set forth on Schedule I hereto (each, a “New Guarantor”), each an indirect subsidiary of Pinafore Holdings B.V. (or its successor) (“Holdings”), and WILMINGTON TRUST FSB, as trustee under the indenture referred to below (the “Trustee”).

W I T N E S S E T H :

WHEREAS the Issuers and the existing Note Guarantors have heretofore executed and delivered to the Trustee an Indenture (as amended, supplemented or otherwise modified, the “Indenture”) dated as of September 29, 2010, providing for the issuance of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”), initially in the aggregate principal amount of $1,150,000,000;

WHEREAS Section 4.10 of the Indenture provides that under certain circumstances Holdings is required to cause the New Guarantors to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the Issuers’ obligations under the Securities pursuant to a Note Guarantee on the terms and conditions set forth herein; and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and the Issuers are authorized to execute and deliver this Supplemental Indenture;

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantors, Holdings, the Issuers, and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

 

  1. Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined, except that the term “Holders” in this Note Guarantee shall refer to the term “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The words “herein,” “hereof” and hereby and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

 

  2. Agreement to Guarantee. The New Guarantors hereby agree, jointly and severally with all existing Note Guarantors (if any), to unconditionally guarantee the Issuers’ obligations under the Securities on the terms and subject to the conditions set forth in Article 11 of the Indenture and to be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements of a Note Guarantor under the Indenture.

 

  3.

Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms,

 

conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

 

  4. Notices. All notices or other communications to the New Guarantor shall be given as provided in Section 12.02 of the Indenture.

 

  5. Governing Law. THIS SUPPLEMENTAL INDENTURE (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

  a. Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Supplemental Indenture or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and subject to the last sentence of this Section 5(a) each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC (now known as Tomkins, LLC) as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

 

  b.

Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment,

 

including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

  c. Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and the Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

 

  6. Russian Guarantor. Solely with respect to the New Guarantor organized under the laws of Russia:

 

  a. Pursuant to Articles 847 and 854 of the Civil Code of the Russian Federation, the Collateral Agent shall have the right to withdraw moneys from the accounts of Gates CIS LLC (the “Russian Obligor”) opened with ZAO Citibank (Russia) (the “Russian Account Bank”) after an Event of Default has occurred and outstanding upon the presentation of payment demands (platezhnoe trebovanie oplachivaemoye bez aksepta) to the Russian Account Bank pursuant to a withdrawal agreement to be entered into between the Russian Obligor, the Russian Account Bank and the Collateral Agent (the “Withdrawal Agreement”) for the purpose of satisfying of the obligations of each Issuer and each Note Guarantor under the Securities and the Note Guarantees.

 

  b. The Russian Obligor must give and maintain to the extent permitted by applicable law:

 

  (i) an irrevocable authority in favour of the Collateral Agent to withdraw moneys from the Russian Obligor’s accounts as provided for in the Withdrawal Agreement; and

  (ii) irrevocable instructions to the Russian Account Bank in form and substance satisfactory to the Russian Account Bank as may be required for:

 

  (A) transfers from one Russian Obligor’s account to another;

 

  (B) conversion from one currency to another currency of moneys standing to the credit of the Russian Obligor’s accounts; and

 

  (C) transfers of the funds from the Russian Obligor’s accounts to the Collateral Agent’s accounts,

provided, however, that non-delivery of such payment instructions shall not prejudice the authority of the Russian Account Bank to perform the relevant money transfer (if such transfer is permitted by applicable law) and shall not affect the validity of any such transfer.

 

  7. Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.

 

  8. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

 

  9. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction thereof.

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

 

GATES ENGINEERING & SERVICES LTD.
GATES FLEXIMAK LTD.
By:  

/s/ John Zimmerman

Name: John Zimmerman
Title: Authorized Person

GATES CIS LLC, as New Guarantor
By:  

/s/ Peter Verdonckt

Name: Peter Verdonckt
Title:
By:  

/s/ Kiril Khaliavin

Name: Kiril Khaliavin
Title:       Chief Accountant
  Seal

EIFELER MASCHINENBAU GMBH,
GATES HOLDING GMBH,
GATES MECTROL GMBH,

TRIDON CLAMP PRODUCTS GMBH,

TRION (DEUTSCHLAND) GMBH, each as New Guarantor

By:  

/s/ John Zimmerman

  Name: John Zimmerman
  Title:   Authorized Person

TOMKINS, LLC (f/k/a PINAFORE, LLC)
By:  

/s/ John Zimmerman

Name: John Zimmerman
Title: Chief Financial Officer
TOMKINS, INC. (f/k/a PINAFORE, INC.)
By:  

/s/ John Zimmerman

Name: John Zimmerman
Title: Chief Financial Officer

WILMINGTON TRUST FSB, AS TRUSTEE
By:  

/s/ Joseph P. O’Donnell

Name: Joseph P. O’Donnell
Title: Vice President
WILMINGTON TRUST FSB, AS COLLATERAL AGENT
By:  

/s/ Joseph P. O’Donnell

Name: Joseph P. O’Donnell
Title: Vice President

SCHEDULE I

 

NEW GUARANTOR

   

JURISDICTION OF ORGANIZATION

GATES ENGINEERING & SERVICES LTD.

    BRITISH VIRGIN ISLANDS

GATES FLEXIMAK LTD.

    BRITISH VIRGIN ISLANDS

GATES CIS LLC

    RUSSIA

EIFELER MASCHINENBAU GMBH

    GERMANY

GATES HOLDING GMBH

    GERMANY

GATES MECTROL GMBH

    GERMANY

TRIDON CLAMP PRODUCTS GMBH

    GERMANY

TRION (DEUTSCHLAND) GMBH

    GERMANY
 EX-4.4 13 dex44.htm EXHIBIT 4.4 Exhibit 4.4

Exhibit 4.4

THIRD SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) dated as of December 23, 2010, among the entity set forth on Schedule I hereto (the “New Guarantor” or the “Belgian Guarantor”), an indirect subsidiary of Pinafore Holdings B.V. (or its successor) (“Holdings”), and WILMINGTON TRUST FSB, as trustee under the indenture referred to below (the “Trustee”).

W I T N E S S E T H:

WHEREAS the Issuers and the existing Note Guarantors have heretofore executed and delivered to the Trustee an Indenture (as amended, supplemented or otherwise modified, the “Indenture”) dated as of September 29, 2010, providing for the issuance of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”), initially in the aggregate principal amount of $1,150,000,000;

WHEREAS Section 4.10 of the Indenture provides that under certain circumstances Holdings is required to cause the New Guarantor to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the Issuers’ obligations under the Securities pursuant to a Note Guarantee on the terms and conditions set forth herein; and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and the Issuers are authorized to execute and deliver this Supplemental Indenture;

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantor, Holdings, the Issuers, and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

 

  1. Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined, except that the term “Holders” in this Note Guarantee shall refer to the term “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The words “herein,” “hereof” and hereby and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

 

  2. Agreement to Guarantee.

 

  a. The New Guarantor hereby agrees, jointly and severally with all existing Note Guarantors (if any), to unconditionally guarantee the Issuers’ obligations under the Securities on the terms and subject to the conditions set forth in Article 11 of the Indenture and to be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements of a Note Guarantor under the Indenture.

 

1

  b. with respect to the Belgian Guarantor, the guarantee of the Guaranteed Obligations (as defined in the Indenture) shall be limited to a maximum aggregate amount equal to the highest of:

 

  i. an amount equal to 90% of the highest of: (A) the net assets (as defined in the Article 320 of the Belgian Company Code, it being understood that any Indebtedness (as defined in the Indenture) owed by such Belgian Guarantor to Holdings or any of its Subsidiaries will not be taken into account for the purpose of calculating such Belgian Guarantor’s net assets) of such Belgian Guarantor as shown by its most recent audited annual financial statements at the date of the relevant Note Guarantee; and (B) the net assets (as defined in the Article 320 of the Belgian Company Code) of such Belgian Guarantor as shown by its most recent audited annual financial statements available at the date on which a demand is made under the Note Guarantee of such relevant Belgian Guarantor, and

 

  ii. the highest level of On-Lending to such Belgian Guarantor and any subsidiaries of such Belgian Guarantor (together, the “Belgian Group”) between the date of such Note Guarantee and the date on which a demand is made on it under such Note Guarantee.

For the purpose of this subsection 2.b., “On-Lending” means, without duplication, the outstanding aggregate amount of any intra-group loans, facilities and other cash or credit advances (whether made in current account, as loan or otherwise) which are made to the relevant Belgian Guarantor or any of its Subsidiaries by any other member of the Belgian Group, directly or indirectly (in each case, irrespective of whether retained or on-lent by that Belgian Guarantor or its Subsidiary);

 

  3. Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

 

  4. Notices. All notices or other communications to the New Guarantor shall be given as provided in Section 12.02 of the Indenture.

 

  5. Governing Law. THIS SUPPLEMENTAL INDENTURE (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

2

  a. Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Supplemental Indenture or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and subject to the last sentence of this Section 5(a) each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC (now known as Tomkins, LLC) as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

 

  b. Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment, including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

  c.

Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal

 

3

 

banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and the Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

 

  6. Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.

 

  7. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

 

  8. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction thereof.

 

4

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

[Signature Pages Follow]

 

5

GATES POWER TRANSMISSION EUROPE

BVBA, as New Guarantor

By:  

/s/ John Zimmerman

  Name:   John Zimmerman
  Title:   Authorized Person, in his capacity as Special Proxy holder

TOMKINS, LLC (f/k/a PINAFORE, LLC)
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Chief Financial Officer
TOMKINS, INC. (f/k/a PINAFORE, INC.)
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Chief Financial Officer

WILMINGTON TRUST FSB, AS TRUSTEE
By:  

/s/ Joseph P. O’Donnell

Name:   Joseph P. O’Donnell
Title:   Vice President
WILMINGTON TRUST FSB, AS COLLATERAL AGENT
By:  

/s/ Joseph P. O’Donnell

Name:   Joseph P. O’Donnell
Title:   Vice President

SCHEDULE I

 

NEW GUARANTOR

  

JURISDICTION OF ORGANIZATION

GATES POWER TRANSMISSION EUROPE BVBA

   BELGIUM
 EX-4.5 14 dex45.htm EXHIBIT 4.5 Exhibit 4.5

Exhibit 4.5

FOURTH SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) dated as of January 20, 2011, among the entity set forth on Schedule I hereto (the “New Guarantor”), an indirect subsidiary of Pinafore Holdings B.V. (or its successor) (“Holdings”), and WILMINGTON TRUST FSB, as trustee under the indenture referred to below (the “Trustee”).

W I T N E S S E T H :

WHEREAS the Issuers and the existing Note Guarantors have heretofore executed and delivered to the Trustee an Indenture (as amended, supplemented or otherwise modified, the “Indenture”) dated as of September 29, 2010, providing for the issuance of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”), initially in the aggregate principal amount of $1,150,000,000;

WHEREAS Section 4.10 of the Indenture provides that under certain circumstances Holdings is required to cause the New Guarantor to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the Issuers’ obligations under the Securities pursuant to a Note Guarantee on the terms and conditions set forth herein; and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and the Issuers are authorized to execute and deliver this Supplemental Indenture;

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantor, Holdings, the Issuers, and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

 

  1. Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined, except that the term “Holders” in this Note Guarantee shall refer to the term “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The words “herein,” “hereof” and hereby and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

 

  2. Agreement to Guarantee. The New Guarantor hereby agrees, jointly and severally with all existing Note Guarantors (if any), to unconditionally guarantee the Issuers’ obligations under the Securities on the terms and subject to the conditions set forth in Article 11 of the Indenture and to be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements of a Note Guarantor under the Indenture.

 

  3.

Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental

 

1

 

Indenture shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

 

  4. Notices. All notices or other communications to the New Guarantor shall be given as provided in Section 12.02 of the Indenture.

 

  5. Governing Law. THIS SUPPLEMENTAL INDENTURE (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

  a. Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Supplemental Indenture or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and subject to the last sentence of this Section 5(a) each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC (now known as Tomkins, LLC) as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

 

  b.

Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment,

 

2

 

including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

  c. Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and the Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

 

  6. Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.

 

  7. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

 

  8. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction thereof.

 

3

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

[Signature Pages Follow]

 

4

Executed by GATES ENGINEERING & SERVICES AUSTRALIA PTY LTD ACN 142 531 244 in accordance with section 127 of the Corporations Act, as a New Guarantor:

/s/ Neil A. Ferguson

Signature of sole director and sole company secretary

Neil A. Ferguson

Name of sole director and company secretary who states that he or she is the sole director and sole company secretary of Gates Engineering & Services Australia Pty Ltd

[Fourth Supplemental Indenture]

TOMKINS, LLC (f/k/a PINAFORE, LLC)
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Chief Financial Officer
TOMKINS, INC. (f/k/a PINAFORE, INC.)
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Chief Financial Officer

[Fourth Supplemental Indenture]

WILMINGTON TRUST FSB, AS TRUSTEE
By:  

/s/ Joseph P. O’Donnell

Name:   Joseph P. O’Donnell
Title:   Vice President
WILMINGTON TRUST FSB, AS COLLATERAL AGENT
By:  

/s/ Joseph P. O’Donnell

Name:   Joseph P. O’Donnell
Title:   Vice President

[Fourth Supplemental Indenture]

SCHEDULE I

 

NEW GUARANTOR

  

JURISDICTION OF ORGANIZATION

GATES ENGINEERING & SERVICES

AUSTRALIA PTY LTD ACN 142 531 244

   AUSTRALIA
 EX-4.6 15 dex46.htm EXHIBIT 4.6 Exhibit 4.6

Exhibit 4.6

FIFTH SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) dated as of February 23, 2011, among the entities set forth on Schedule I hereto (each a “New Guarantor”), an indirect subsidiary of Pinafore Holdings B.V. (or its successor) (“Holdings”), and WILMINGTON TRUST FSB, as trustee under the indenture referred to below (the “Trustee”).

W I T N E S S E T H :

WHEREAS the Issuers and the existing Note Guarantors have heretofore executed and delivered to the Trustee an Indenture (as amended, supplemented or otherwise modified, the “Indenture”) dated as of September 29, 2010, providing for the issuance of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”), initially in the aggregate principal amount of $1,150,000,000;

WHEREAS Section 4.10 of the Indenture provides that under certain circumstances Holdings is required to cause the New Guarantor to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the Issuers’ obligations under the Securities pursuant to a Note Guarantee on the terms and conditions set forth herein; and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and the Issuers are authorized to execute and deliver this Supplemental Indenture;

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, each New Guarantor, Holdings, the Issuers, and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

 

  1. Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined, except that the term “Holders” in this Note Guarantee shall refer to the term “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The words “herein,” “hereof” and hereby and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

 

  2. Agreement to Guarantee. Each New Guarantor hereby agrees, jointly and severally with all existing Note Guarantors (if any), to unconditionally guarantee the Issuers’ obligations under the Securities on the terms and subject to the conditions set forth in Article 11 of the Indenture and to be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements of a Note Guarantor under the Indenture.

 

  3.

Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental

 

Indenture shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

 

  4. Notices. All notices or other communications to each New Guarantor shall be given as provided in Section 12.02 of the Indenture.

 

  5. Governing Law. THIS SUPPLEMENTAL INDENTURE (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

  a. Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Supplemental Indenture or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and subject to the last sentence of this Section 5(a) each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC (now known as Tomkins, LLC) as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

 

  b.

Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment,

 

2

 

including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

  c. Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and the Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

 

  6. Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.

 

  7. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

 

  8. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction thereof.

 

3

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

[Signature Pages Follow]

 

4

SCHRADER INTERNATIONAL BRASIL LTDA.,

as a New Guarantor

By:  

/s/ Richard Hoffner

  Name: Richard Hoffner
  Title:

[Fifth Supplemental Indenture]

AMP INDUSTRIAL MEXICANA, S.A. DE C.V.

APLICADORES MEXICANOS, S.A. DE C.V.

AUTO INDUSTRIAL DE PARTES, S.A. DE C.V.

RUSKIN DE MÉXICO, S.A. DE C.V.

TOMKINS POLY BELT MEXICANA,

S.A. DE C.V., as a New Guarantors

By:

  

/s/ John Zimmerman

  Name: John Zimmerman
  Title: Authorized Person

[Fifth Supplemental Indenture]

GATES POWERTRAIN PLASTIK

METAL VE MAKINA SANAYII VE

TICARET LIMITED ŞIRKETI

GATES GÜÇ AKTARIM SISTEMLERI

DAĞITIM SANAYI VE TICARET

LIMITED ŞIRKETI, as a New Guarantors

By:  

/s/ John Zimmerman

  Name: John Zimmerman
  Title: Authorized Person

[Fifth Supplemental Indenture]

GATES ENGINEERING & SERVICES FZCO, as

a New Guarantor

By:  

/s/ John Zimmerman

  Name: John Zimmerman
  Title: Authorized Person

[Fifth Supplemental Indenture]

TOMKINS, LLC (f/k/a PINAFORE, LLC)

By:

  

/s/ John Zimmerman

Name:

   John Zimmerman

Title:

   Chief Financial Officer

TOMKINS, INC. (f/k/a PINAFORE, INC.)

By:

  

/s/ John Zimmerman

Name:

   John Zimmerman

Title:

   Chief Financial Officer

[Fifth Supplemental Indenture]

WILMINGTON TRUST FSB, AS TRUSTEE

By:

  

/s/ Joseph P. O’Donnell

Name:

   Joseph P. O’Donnell

Title:

   Vice President

WILMINGTON TRUST FSB, AS COLLATERAL AGENT

By:

  

/s/ Joseph P. O’Donnell

Name:

   Joseph P. O’Donnell

Title:

   Vice President

[Fifth Supplemental Indenture]

SCHEDULE I

 

NEW GUARANTOR

  

JURISDICTION OF ORGANIZATION

SCHRADER INTERNATIONAL BRASIL LTDA.   BRAZIL
AMP INDUSTRIAL MEXICANA, S.A. DE C.V.   MEXICO
APLICADORES MEXICANOS, S.A. DE C.V.   MEXICO
AUTO INDUSTRIAL DE PARTES, S.A. DE C.V.   MEXICO
RUSKIN DE MÉXICO, S.A. DE C.V.   MEXICO
TOMKINS POLY BELT MEXICANA, S.A. DE C.V.   MEXICO
GATES POWERTRAIN PLASTIK METAL VE MAKINA SANAYII VE TICARET LIMITED ŞIRKETI   TURKEY
GATES GÜÇ AKTARIM SISTEMLERI DAĞITIM SANAYI VE TICARET LIMITED ŞIRKETI   TURKEY
GATES ENGINEERING & SERVICES FZCO   UNITED ARAB EMIRATES
 EX-4.7 16 dex47.htm EXHIBIT 4.7 Exhibit 4.7

Exhibit 4.7

SIXTH SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) dated as of February 24, 2011, among Gates Powertrain UK Limited (the “New Guarantor”), an indirect subsidiary of Pinafore Holdings B.V. (or its successor) (“Holdings”), and WILMINGTON TRUST FSB, as trustee under the indenture referred to below (the “Trustee”).

W I T N E S S E T H :

WHEREAS the Issuers and the existing Note Guarantors have heretofore executed and delivered to the Trustee an Indenture (as amended, supplemented or otherwise modified, the “Indenture”) dated as of September 29, 2010, providing for the issuance of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”), initially in the aggregate principal amount of $1,150,000,000;

WHEREAS Section 4.10 of the Indenture provides that under certain circumstances Holdings is required to cause the New Guarantor to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the Issuers’ obligations under the Securities pursuant to a Note Guarantee on the terms and conditions set forth herein; and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and the Issuers are authorized to execute and deliver this Supplemental Indenture;

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantor, Holdings, the Issuers, and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

 

  1. Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined, except that the term “Holders” in this Note Guarantee shall refer to the term “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The words “herein,” “hereof” and hereby and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

 

  2. Agreement to Guarantee. The New Guarantor hereby agrees, jointly and severally with all existing Note Guarantors (if any), to unconditionally guarantee the Issuers’ obligations under the Securities on the terms and subject to the conditions set forth in Article 11 of the Indenture and to be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements of a Note Guarantor under the Indenture.

 

  3.

Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental

 

Indenture shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

 

  4. Notices. All notices or other communications to the New Guarantor shall be given as provided in Section 12.02 of the Indenture.

 

  5. Governing Law. THIS SUPPLEMENTAL INDENTURE (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

  a. Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Supplemental Indenture or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and subject to the last sentence of this Section 5(a) each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC (now known as Tomkins, LLC) as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

 

  b.

Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment,

 

2

 

including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

  c. Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and the Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

 

  6. Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.

 

  7. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

 

  8. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction thereof.

 

3

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

[Signature Pages Follow]

 

4

GATES POWERTRAIN UK LIMITED, as a New

Guarantor

By:  

/s/ John Zimmerman

  Name:   John Zimmerman
  Title:   Authorized Person

[Sixth Supplemental Indenture]

TOMKINS, LLC (f/k/a PINAFORE, LLC)
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Person
TOMKINS, INC. (f/k/a PINAFORE, INC.)
By:  

/s/ John Zimmerman

Name:   John Zimmerman
Title:   Authorized Person

[Sixth Supplemental Indenture]

WILMINGTON TRUST FSB, AS TRUSTEE
By:  

/s/ Joseph P. O’Donnell

Name:   Joseph P. O’Donnell
Title:   Vice President

WILMINGTON TRUST FSB, AS COLLATERAL

AGENT

By:  

/s/ Joseph P. O’Donnell

Name:   Joseph P. O’Donnell
Title:   Vice President

[Sixth Supplemental Indenture]

EX-4.8 17 dex48.htm EXHIBIT 4.8 Exhibit 4.8

Exhibit 4.8

SEVENTH SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”) dated as of March 3, 2011, among Gates Engineering & Services Hamriyah FZE (the “New Guarantor”), an indirect subsidiary of Pinafore Holdings B.V. (or its successor) (“Holdings”), and WILMINGTON TRUST FSB, as trustee under the indenture referred to below (the “Trustee”).

W I T N E S S E T H :

WHEREAS the Issuers and the existing Note Guarantors have heretofore executed and delivered to the Trustee an Indenture (as amended, supplemented or otherwise modified, the “Indenture”) dated as of September 29, 2010, providing for the issuance of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”), initially in the aggregate principal amount of $1,150,000,000;

WHEREAS Section 4.10 of the Indenture provides that under certain circumstances Holdings is required to cause the New Guarantor to execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor shall unconditionally guarantee all the Issuers’ obligations under the Securities pursuant to a Note Guarantee on the terms and conditions set forth herein; and

WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee and the Issuers are authorized to execute and deliver this Supplemental Indenture;

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the New Guarantor, Holdings, the Issuers, and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

 

  1. Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used herein as therein defined, except that the term “Holders” in this Note Guarantee shall refer to the term “Holders” as defined in the Indenture and the Trustee acting on behalf of and for the benefit of such Holders. The words “herein,” “hereof” and hereby and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

 

  2. Agreement to Guarantee. The New Guarantor hereby agrees, jointly and severally with all existing Note Guarantors (if any), to unconditionally guarantee the Issuers’ obligations under the Securities on the terms and subject to the conditions set forth in Article 11 of the Indenture and to be bound by all other applicable provisions of the Indenture and the Securities and to perform all of the obligations and agreements of a Note Guarantor under the Indenture.

 

  3.

Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental

 

Indenture shall form a part of the Indenture for all purposes, and every holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

 

  4. Notices. All notices or other communications to the New Guarantor shall be given as provided in Section 12.02 of the Indenture.

 

  5. Governing Law. THIS SUPPLEMENTAL INDENTURE (AND EXCLUDING ANY COLLATERAL DOCUMENTS THAT ARE EXPRESSED TO BE SUBJECT TO ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

  a. Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Supplemental Indenture or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and subject to the last sentence of this Section 5(a) each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC (now known as Tomkins, LLC) as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

 

  b.

Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding (a “Related Judgment”), each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment,

 

2

 

including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

 

  c. Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Trustee, acting on behalf of and for the benefit of the Holders, could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Issuers and each Note Guarantor in respect of any sum due from them to the Trustee shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by the Trustee of any sum adjudged to be so due in such other currency, on which (and only to the extent that) the Trustee may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to the Trustee and the Holders hereunder, the Issuers and each Note Guarantor agree, as a separate obligation and notwithstanding any such judgment, to indemnify the Trustee and the Holders against such loss. If the U.S. dollars so purchased are greater than the sum originally due to the Trustee and the Holders hereunder, the Trustee agrees to deliver to the Issuers and the Note Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to the Trustee and the Holders hereunder.

 

  6. Trustee Makes No Representation. The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture.

 

  7. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

 

  8. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction thereof.

 

3

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

[Signature Pages Follow]

 

4

GATES ENGINEERING & SERVICES
HAMRIYAH FZE, as a New Guarantor
By:   

/s/ John Zimmerman

   Name: John Zimmerman
   Title: Authorized Person

[Seventh Supplemental Indenture]

TOMKINS, LLC (f/k/a PINAFORE, LLC)
By:  

/s/ John Zimmerman

Name: John Zimmerman
Title: Authorized Person
TOMKINS, INC. (f/k/a PINAFORE, INC.)
By:  

/s/ John Zimmerman

Name: John Zimmerman
Title: Authorized Person

[Seventh Supplemental Indenture]

WILMINGTON TRUST FSB, AS TRUSTEE
By:  

/s/ Jane Schweiger

Name: Jane Schweiger
Title: Vice President
WILMINGTON TRUST FSB, AS COLLATERAL AGENT
By:  

/s/ Jane Schweiger

Name: Jane Schweiger
Title: Vice President

[Seventh Supplemental Indenture]

EX-4.10 18 dex410.htm EXHIBIT 4.10 Exhibit 4.10

Exhibit 4.10

EXECUTION VERSION

REGISTRATION RIGHTS AGREEMENT

by and among

Pinafore, LLC

Pinafore, Inc.

Pinafore Acquisitions Limited

Other Guarantors

and

Banc of America Securities LLC

Citigroup Global Markets Inc.

Barclays Capital Inc.

RBC Capital Markets Corporation

UBS Securities LLC

Dated as of September 29, 2010

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) is made and entered into as of September 29, 2010, by and among Pinafore, LLC, a Delaware limited liability company (“LLC Co-Issuer”) and Pinafore, Inc., a Delaware corporation (“Corporate Co-Issuer” and together with Pinafore, LLC, the “Issuers”), Pinafore Acquisitions Limited (“Bidco”), the other guarantors party hereto and the other entities listed on Schedule 1 hereto that become a party hereto from time to time by executing a joinder agreement in the form attached hereto as Exhibit A or otherwise reasonably satisfactory to the Initial Purchasers (the “Other Guarantors” and, together with Bidco, the “Guarantors”), and Banc of America Securities LLC, Citigroup Global Markets, Inc., Barclays Capital Inc., RBC Capital Markets Corporation and UBS Securities LLC, as Representatives of the initial purchasers listed on Schedule 2 hereto (collectively, the “Initial Purchasers”) each of whom has agreed to purchase the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Initial Notes”) fully and unconditionally guaranteed by the Guarantors (the “Guarantees”) pursuant to the Purchase Agreement (as defined below). The Initial Notes and the Guarantees attached thereto are herein collectively referred to as the “Initial Securities.”

This Agreement is made pursuant to the Purchase Agreement, dated September 21, 2010 (the “Purchase Agreement”), among the Issuers, the Guarantors party thereto and the Initial Purchasers (i) for the benefit of the Initial Purchasers and (ii) for the benefit of the holders from time to time of the Initial Securities, including the Initial Purchasers. In order to induce the Initial Purchasers to purchase the Initial Securities, the Issuers have agreed to provide the registration rights set forth in this Agreement. The execution and delivery of this Agreement is a condition to the obligations of the Initial Purchasers set forth in Section 5(f) of the Purchase Agreement.

The parties hereby agree as follows:

SECTION 1. Definitions. As used in this Agreement, the following capitalized terms shall have the following meanings:

Additional Interest: As defined in Section 5 hereof.

Additional Interest Payment Date: With respect to the Initial Securities, each Interest Payment Date.

Broker-Dealer: Any broker or dealer registered under the Exchange Act.

Business Day: Any day other than a Saturday, Sunday or U.S. federal holiday or a day on which banking institutions or trust companies located in New York, New York are authorized or obligated to be closed.

Closing Date: The date of this Agreement.

Commission: The U.S. Securities and Exchange Commission.

Consummate: A registered Exchange Offer shall be deemed “Consummated” for purposes of this Agreement upon the occurrence of (i) the filing and effectiveness under the Securities

Act of the Exchange Offer Registration Statement relating to the Exchange Securities to be issued in the Exchange Offer, (ii) the maintenance of such Registration Statement continuously effective and the keeping of the Exchange Offer open for a period not less than the minimum period required pursuant to Section 3(b) hereof, and (iii) the delivery by the Issuers to the Registrar under the Indenture of Exchange Securities in the same aggregate principal amount as the aggregate principal amount of Initial Securities that were tendered by Holders thereof pursuant to the Exchange Offer.

Effectiveness Target Date: As defined in Section 5 hereof.

Exchange Act: The Securities Exchange Act of 1934, as amended.

Exchange Offer: The registration by the Issuers under the Securities Act of the Exchange Securities pursuant to a Registration Statement pursuant to which the Issuers offer the Holders of all outstanding Transfer Restricted Securities (as permitted under applicable law and Commission policy) the opportunity to exchange all such outstanding Transfer Restricted Securities held by such Holders for Exchange Securities in an aggregate principal amount equal to the aggregate principal amount of the Transfer Restricted Securities tendered in such exchange offer by such Holders.

Exchange Offer Registration Statement: The Registration Statement relating to the Exchange Offer, including the related Prospectus.

Exchange Securities: The 9% Senior Secured Second Lien Notes due 2018, of the same series under the Indenture as the Initial Notes and the Guarantees attached thereto, to be issued to Holders in exchange for Transfer Restricted Securities pursuant to this Agreement.

Holders: As defined in Section 2(b) hereof.

FINRA: Financial Industry Regulatory Authority, Inc.

Indemnified Holder: As defined in Section 8(a) hereof.

Indenture: The Indenture, dated as of September 29, 2010, by and among the Issuers, the Guarantors party thereto and Wilmington Trust FSB, as trustee (the “Trustee”), pursuant to which the Securities are to be issued, as such Indenture is amended or supplemented from time to time in accordance with the terms thereof.

Initial Purchaser: As defined in the preamble hereto.

Initial Notes: As defined in the preamble hereto.

Initial Placement: The issuance and sale by the Issuers of the Initial Securities to the Initial Purchasers pursuant to the Purchase Agreement.

Initial Securities: As defined in the preamble hereto.

Interest Payment Date: As defined in the Indenture and the Securities.

 

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Person: An individual, partnership, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof.

Prospectus: The prospectus included in a Registration Statement, as amended or supplemented by any prospectus supplement and by all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus.

Registration Default: As defined in Section 5 hereof.

Registration Statement: Any registration statement of the Issuers relating to (a) an offering of Exchange Securities pursuant to an Exchange Offer or (b) the registration for resale of Transfer Restricted Securities pursuant to the Shelf Registration Statement, which is filed pursuant to the provisions of this Agreement, in each case, including the Prospectus included therein, all amendments and supplements thereto (including post-effective amendments) and all exhibits and material incorporated by reference therein.

Securities: As defined in the preamble hereto.

Securities Act: The Securities Act of 1933, as amended.

Shelf Filing Deadline: As defined in Section 4(a) hereof.

Shelf Registration Statement: As defined in Section 4(a) hereof.

Transfer Restricted Securities: Each Initial Security, until the earliest to occur of (a) the date on which such Initial Security is exchanged in the Exchange Offer for an Exchange Security entitled to be resold to the public by the Holder thereof without complying with the prospectus delivery requirements of the Securities Act, (b) the date on which such Initial Security has been effectively registered under the Securities Act and disposed of in accordance with a Shelf Registration Statement and (c) the date on which such Initial Security is distributed to the public by a Broker-Dealer pursuant to the “Plan of Distribution” contemplated by the Exchange Offer Registration Statement (including delivery of the Prospectus contained therein).

Trust Indenture Act: The Trust Indenture Act of 1939, as amended.

Underwritten Registration or Underwritten Offering: A registration in which securities of the Issuers are sold to an underwriter for reoffering to the public.

SECTION 2. Securities Subject to this Agreement.

(a) Transfer Restricted Securities. The securities entitled to the benefits of this Agreement are the Transfer Restricted Securities.

(b) Holders of Transfer Restricted Securities. A Person is deemed to be a holder of Transfer Restricted Securities (each, a “Holder”) whenever such Person owns Transfer Restricted Securities.

 

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SECTION 3. Registered Exchange Offer.

(a) Unless the Exchange Offer shall not be permissible under applicable law or Commission policy (after the procedures set forth in Section 6(a) hereof have been complied with), each of the Issuers and the Guarantors shall use their commercially reasonable efforts to: (i) cause to be filed with the Commission no later than 270 days after the Closing Date (or if such 270th day is not a Business Day, the next succeeding Business Day), a Registration Statement under the Securities Act relating to the Exchange Securities and the Exchange Offer, (ii) cause such Registration Statement to become effective no later than 360 days after the Closing Date (or if such 360th day is not a Business Day, the next succeeding Business Day) (the “Effectiveness Target Date”), (iii) in connection with the foregoing, file (A) all pre-effective amendments to such Registration Statement as may be necessary in order to cause such Registration Statement to become effective, (B) if applicable, a post-effective amendment to such Registration Statement pursuant to Rule 430A under the Securities Act and (C) cause all necessary filings in connection with the registration and qualification of the Exchange Securities to be made under the state securities or blue sky laws of such jurisdictions as are necessary to permit Consummation of the Exchange Offer, and (iv) upon the effectiveness of such Registration Statement, commence the Exchange Offer. The Exchange Offer shall be on the appropriate form permitting registration of the Exchange Securities to be offered in exchange for the Transfer Restricted Securities and to permit resales of Initial Securities held by Broker-Dealers as contemplated by Section 3(c) hereof.

(b) The Issuers and the Guarantors shall use their commercially reasonable efforts to cause the Exchange Offer Registration Statement to be effective continuously and shall keep the Exchange Offer open for a period of not less than the minimum period required under applicable federal and state securities laws to Consummate the Exchange Offer; provided, however, that in no event shall such period be less than 20 Business Days after the date notice of the Exchange Offer is sent to the Holders. The Issuers shall cause the Exchange Offer to comply with all applicable federal and state securities laws. No securities other than the Exchange Securities shall be included in the Exchange Offer Registration Statement. Each of the Issuers shall use its commercially reasonable efforts to cause the Exchange Offer to be Consummated no later than 30 Business Days after the date notice of the Exchange Offer is required to be sent to the Holder.

(c) The Issuers shall indicate in a “Plan of Distribution” section contained in the Prospectus forming a part of the Exchange Offer Registration Statement that any Broker-Dealer who holds Initial Securities that are Transfer Restricted Securities and that were acquired for its own account as a result of market-making activities or other trading activities (other than Transfer Restricted Securities acquired directly from the Issuers), may exchange such Initial Securities pursuant to the Exchange Offer; however, such Broker-Dealer may be deemed to be an “underwriter” within the meaning of the Securities Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the Exchange Securities received by such Broker-Dealer in the Exchange Offer, which prospectus delivery requirement may be satisfied by the delivery by such Broker-Dealer of the Prospectus contained in the Exchange Offer Registration Statement. Such “Plan of Distribution” section shall also contain all other information with respect to such resales by Broker-Dealers that the Commission may require in order to permit such resales pursuant thereto, but such “Plan of Distribution” shall not

 

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name any such Broker-Dealer or disclose the amount of Initial Securities held by any such Broker-Dealer except to the extent required by the Commission as a result of a change in policy after the date of this Agreement.

Each of the Issuers and the Guarantors shall use its commercially reasonable efforts to keep the Exchange Offer Registration Statement continuously effective, supplemented and amended as required by the provisions of Section 6(c) hereof to the extent necessary to ensure that it is available for resales of Initial Securities acquired by Broker-Dealers for their own accounts as a result of market-making activities or other trading activities, and to ensure that it conforms with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, for a period ending on the earlier of (i) 180 days from the date on which the Exchange Offer Registration Statement is declared effective and (ii) the date on which a Broker-Dealer is no longer required to deliver a prospectus in connection with market-making or other trading activities.

The Issuers shall provide sufficient copies of the latest version of such Prospectus to Broker-Dealers promptly upon request at any time during such 180-day (or shorter as provided in the foregoing sentence) period in order to facilitate such resales.

SECTION 4. Shelf Registration.

(a) Shelf Registration. If (i) the Issuers are not required to file an Exchange Offer Registration Statement or to consummate the Exchange Offer because the Exchange Offer is not permitted by applicable law or Commission policy (after the procedures set forth in Section 6(a) hereof have been complied with), (ii) for any reason the Exchange Offer is not Consummated after the Effectiveness Target Date, or (iii) with respect to any Holder of Transfer Restricted Securities such Holder notifies the Issuers prior to the 20th day following the Consummation of the Exchange Offer that (A) such Holder is prohibited by applicable law or Commission policy from participating in the Exchange Offer, or (B) such Holder may not resell the Exchange Securities acquired by it in the Exchange Offer to the public without delivering a prospectus and that the Prospectus contained in the Exchange Offer Registration Statement is not appropriate or available for such resales by such Holder, or (C) such Holder is a Broker-Dealer and holds Initial Securities acquired directly from the Issuers or one of their respective affiliates, then, upon such Holder’s request, the Issuers and the Guarantors shall

(x) use their commercially reasonable efforts to cause to be filed a shelf registration statement pursuant to Rule 415 under the Securities Act, which may be an amendment to the Exchange Offer Registration Statement (in either event, the “Shelf Registration Statement”) within 60 days after such filing obligations arises (or if such 60th day is not a Business Day, the next succeeding Business Day) (such date being the “Shelf Filing Deadline”), which Shelf Registration Statement shall provide for resales of all Transfer Restricted Securities the Holders of which shall have provided the information required pursuant to Section 4(b) hereof; and

(y) use their commercially reasonable efforts to cause such Shelf Registration Statement to be declared effective by the Commission on or before the 150th day after

 

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the obligation to file such Shelf Registration Statement arises (or if such 150th day is not a Business Day, the next succeeding Business Day).

Each of the Issuers and the Guarantors shall use its commercially reasonable efforts to keep such Shelf Registration Statement continuously effective, supplemented and amended as required by the provisions of Sections 6(b) and (c) hereof to the extent necessary to ensure that it is available for resales of Initial Securities by the Holders of Transfer Restricted Securities entitled to the benefit of this Section 4(a), and to ensure that it conforms with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, for a period of at least one year (as extended by any Shelf Black-Out Period (as defined below) following the effective date of such Shelf Registration Statement (or shorter period that will terminate when all the Initial Securities covered by such Shelf Registration Statement have been sold pursuant to such Shelf Registration Statement), provided that the Issuers may, on a maximum of two occasions not to exceed 90 days in the aggregate (a “Shelf Black-Out Period”) in any twelve-month period determine that the Shelf Registration Statement is not usable under certain circumstances relating to corporate developments, public filings with the Commission and similar events, and suspend the use of the prospectus that is part of the Shelf Registration Statement if the Board Director determines in good faith that the disclosure of such development or event or other item could reasonably be expected to have a material adverse effect on the business of Holdings and its subsidiaries taken as a whole).

(b) Provision by Holders of Certain Information in Connection with the Shelf Registration Statement. No Holder of Transfer Restricted Securities may include any of its Transfer Restricted Securities in any Shelf Registration Statement pursuant to this Agreement unless and until such Holder furnishes to the Issuers in writing, within 20 Business Days after receipt of a request therefor, such information as the Issuers may reasonably request for use in connection with any Shelf Registration Statement or Prospectus or preliminary Prospectus included therein. Each Holder as to which any Shelf Registration Statement is being effected agrees to furnish promptly to the Issuers all information required to be disclosed in order to make the information previously furnished to the Issuers by such Holder not materially misleading.

SECTION 5. Additional Interest. If (i) unless the Exchange Offer shall not be permissible under applicable law or Commission policy, the Exchange Offer Registration Statement has not been declared effective by the Commission (or become automatically effective) on or prior to 360 days after the Closing Date (the “Exchange Offer Effectiveness Target Date”), (ii) in the event the Issuers and the Guarantors are required to file a Shelf Registration Statement pursuant to Section 4(a) hereof, the Shelf Registration Statement has not been declared effective by the Commission (or become automatically effective) on or prior to 150 days after the obligation to file a Shelf Registration Statement arises (the “Shelf Registration Effectiveness Target Date” and, together with the Exchange Offer Effectiveness Date, the “Effectiveness Target Date”), (iii) the Exchange Offer has not been Consummated within 30 Business Days after the Exchange Offer Effectiveness Target Date with respect to the Exchange Offer Registration Statement, or (iv) any Registration Statement required by this Agreement is filed and declared effective but shall thereafter cease to be effective or fails to be usable for its intended purpose without being succeeded immediately by a post-effective amendment to such Registration Statement that cures such failure and that is itself immediately declared or

 

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automatically effective (except in the case of a Registration Statement that ceases to be effective or usable as specifically permitted by the last paragraph of Section 6 hereof) (each such event referred to in clauses (i) through (iv), a “Registration Default”), the Issuers and the Guarantors hereby agree that the interest rate borne by the affected series of Transfer Restricted Securities shall be increased by 0.25% per annum during the 90-day period immediately following the occurrence of any Registration Default and shall increase by 0.25% per annum at the end of each subsequent 90-day period, but in no event shall such increase exceed 1.00% per annum. Following the cure of all Registration Defaults relating to any particular Transfer Restricted Securities, the interest rate borne by the relevant Transfer Restricted Securities will be reduced to the original interest rate borne by such Transfer Restricted Securities; provided, however, that, if after any such reduction in interest rate, a different Registration Default occurs, the interest rate borne by the relevant Transfer Restricted Securities shall again be increased pursuant to the foregoing provisions. Notwithstanding any other provisions of this section, no Additional Interest shall accrue for a Registration Default that occurs solely by reason of a Shelf Black-Out Period.

Notwithstanding the foregoing, (i) the amount of Additional Interest payable shall not increase because more than one Registration Default has occurred and is pending and (ii) a Holder of Transfer Restricted Securities that is not entitled to the benefits of the Shelf Registration Statement (because, e.g., such Holder has not elected to include information or has not timely delivered such information to the Issuer pursuant to Section 4(b) hereof) shall not be entitled to Additional Interest with respect to a Registration Default that pertains to the Shelf Registration Statement.

All obligations of the Issuers and the Guarantors set forth in the preceding paragraph that are outstanding with respect to any Transfer Restricted Security at the time such security ceases to be a Transfer Restricted Security shall survive until such time as all such obligations with respect to such security shall have been satisfied in full.

SECTION 6. Registration Procedures.

(a) Exchange Offer Registration Statement. In connection with the Exchange Offer, the Issuers and the Guarantors shall comply with all of the provisions of Section 6(c) hereof, shall use their commercially reasonable efforts to effect such exchange to permit the sale of Transfer Restricted Securities being sold in accordance with the intended method or methods of distribution thereof, and shall comply with all of the following provisions:

(i) As a condition to its participation in the Exchange Offer pursuant to the terms of this Agreement, each Holder of Transfer Restricted Securities shall furnish, upon the request of the Issuers, prior to the Consummation thereof, a written representation to the Issuers (which may be contained in the letter of transmittal contemplated by the Exchange Offer Registration Statement) to the effect that (A) it is not an affiliate of the Issuers, (B) it is not engaged in, and does not intend to engage in, and has no arrangement or understanding with any Person to participate in, a distribution of the Exchange Securities to be issued in the Exchange Offer and (C) it is acquiring the Exchange Securities in its ordinary course of business. In addition, all such Holders of Transfer Restricted Securities shall otherwise cooperate in the Issuers’ preparations for the Exchange Offer. Each

 

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Holder hereby acknowledges and agrees that any Broker-Dealer and any such Holder using the Exchange Offer to participate in a distribution of the securities to be acquired in the Exchange Offer (1) could not under Commission policy as in effect on the date of this Agreement rely on the position of the Commission enunciated in Morgan Stanley and Co., Inc. (available June 5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in the Commission’s letter to Shearman & Sterling dated July 2, 1993, and similar no-action letters, and (2) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction and that such a secondary resale transaction should be covered by an effective registration statement containing the selling security holder information required by Item 507 or 508, as applicable, of Regulation S-K if the resales are of Exchange Securities obtained by such Holder in exchange for Initial Securities acquired by such Holder directly from the Issuers.

(b) Shelf Registration Statement. In connection with the Shelf Registration Statement, each of the Issuers and the Guarantors shall comply with all the provisions of Section 6(c) hereof and shall use its commercially reasonable efforts to effect such registration to permit the sale of the Transfer Restricted Securities being sold in accordance with the intended method or methods of distribution thereof, and pursuant thereto each of the Issuers and the Guarantors will as promptly as possible prepare and file with the Commission a Registration Statement relating to the registration on any appropriate form under the Securities Act, which form shall be available for the sale of the Transfer Restricted Securities in accordance with the intended method or methods of distribution thereof.

(c) General Provisions. In connection with any Registration Statement and any Prospectus required by this Agreement to permit the sale or resale of Transfer Restricted Securities (including, without limitation, any Registration Statement and the related Prospectus required to permit resales of Initial Securities by Broker-Dealers), each of the Issuers and the Guarantors shall:

(i) use its commercially reasonable efforts to keep such Registration Statement continuously effective and provide all requisite financial statements (including, if required by the Securities Act or any regulation thereunder, financial statements of the Guarantors for the period specified in Section 3 or 4 hereof, as applicable; upon the occurrence of any event that would cause any such Registration Statement or the Prospectus contained therein (A) to contain a material misstatement or omission or (B) not to be effective and usable for resale of Transfer Restricted Securities during the period required by this Agreement, the Issuers shall file promptly an appropriate amendment to such Registration Statement, in the case of clause (A), correcting any such misstatement or omission, and, in the case of either clause (A) or (B), use its commercially reasonable efforts to cause such amendment to be declared effective and such Registration Statement and the related Prospectus to become usable for their intended purpose(s) as soon as practicable thereafter;

(ii) use its commercially reasonable efforts to prepare and file with the Commission such amendments and post-effective amendments to the applicable Registration

 

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Statement as may be necessary to keep the Registration Statement effective for the applicable period set forth in Section 3 or 4 hereof, as applicable, or such shorter period as will terminate when all Transfer Restricted Securities covered by such Registration Statement have been sold; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities Act, and to comply fully with the applicable provisions of Rules 424 and 430A under the Securities Act in a timely manner; and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Registration Statement during the applicable period in accordance with the intended method or methods of distribution by the sellers thereof set forth in such Registration Statement or supplement to the Prospectus;

(iii) advise the underwriter(s), if any, and selling Holders promptly and, if requested by such Persons, to confirm such advice in writing, (A) when the Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to any Registration Statement or any post-effective amendment thereto, when the same has become effective, (B) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information relating thereto, (C) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement under the Securities Act or of the suspension by any state securities commission of the qualification of the Transfer Restricted Securities for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes, (D) of the existence of any fact or the happening of any event that makes any statement of a material fact made in the Registration Statement, the Prospectus, any amendment or supplement thereto, or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in the Registration Statement or the Prospectus in order to make the statements therein not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Transfer Restricted Securities under state securities or blue sky laws, each of the Issuers and the Guarantors shall use its commercially reasonable efforts to obtain the withdrawal or lifting of such order at the earliest possible time;

(iv) furnish without charge to counsel for the Initial Purchasers and each of the underwriter(s), if any, before filing with the Commission, copies of any Registration Statement or any Prospectus included therein or any amendments or supplements to any such Registration Statement or Prospectus (including all documents incorporated by reference after the initial filing of such Registration Statement), which documents will be subject to the review and comment of such Holders and underwriter(s) in connection with such sale, if any, for a period of at least five Business Days, and the Issuers will not file any such Registration Statement or Prospectus or any amendment or supplement to any such Registration Statement or Prospectus (including all such documents incorporated by reference) to which an Initial Purchaser of Transfer Restricted Securities covered by such Registration Statement or the underwriter(s), if any, shall reasonably object in writing within five Business Days after the receipt thereof (such objection to be deemed timely

 

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made upon confirmation of telecopy transmission within such period), except for any Registration Statement, Prospectus or any amendment or supplement to such Shelf Registration Statement or Prospectus (a copy of which has been previously furnished as provided in the preceding sentence) that counsel to the Issuers has advised the Issuers that are, to such counsel’s knowledge, required to be filed to comply with law. The objection of an Initial Purchaser or underwriter, if any, shall be deemed to be reasonable if such Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains a material misstatement or omission;

(v) [Reserved];

(vi) make available at reasonable times for inspection by the Initial Purchasers, the managing underwriter(s), if any, participating in any disposition pursuant to such Registration Statement and any attorney or accountant retained by such Initial Purchasers or any of the underwriter(s), diligence materials reasonably requested in connection with such Registration Statement or any post-effective amendment thereto subsequent to the filing thereof and prior to its effectiveness;

(vii) if requested by any selling Holders or the underwriter(s), if any, use commercially reasonable efforts to incorporate in any Registration Statement or Prospectus, pursuant to a supplement or post-effective amendment if necessary, such information as is customarily included and as such selling Holders and underwriter(s), if any, may reasonably request to have included therein, including, without limitation, information relating to the “Plan of Distribution” of the Transfer Restricted Securities, information with respect to the principal amount of Transfer Restricted Securities being sold to such underwriter(s), the purchase price being paid therefor and any other terms of the offering of the Transfer Restricted Securities to be sold in such offering; and make all required filings of such Prospectus supplement or post-effective amendment as soon as reasonably practicable after the Issuers are notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment;

(viii) cause the Transfer Restricted Securities covered by the Registration Statement to be rated with the appropriate rating agencies, if so requested by the Holders of a majority in aggregate principal amount of Securities covered thereby or the underwriter(s), if any;

(ix) furnish to each Initial Purchaser, each selling Holder and each of the underwriter(s), if any, in each case that so requests in writing and without charge, at least one copy of the Registration Statement, as first filed with the Commission, and of each amendment thereto, including financial statements and schedules, all documents incorporated by reference therein and all exhibits (including exhibits incorporated therein by reference);

(x) deliver to each selling Holder and each of the underwriter(s), if any, without charge, as many copies of the Prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons reasonably may request; each of the Issuers and the Guarantors hereby consents to the use of the Prospectus and any

 

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amendment or supplement thereto by each of the selling Holders and each of the underwriter(s), if any, in connection with the offering and the sale of the Transfer Restricted Securities covered by the Prospectus or any amendment or supplement thereto;

(xi) enter into such agreements (including an underwriting agreement), and make such representations and warranties, and take all such other actions in connection therewith in order to expedite or facilitate the disposition of the Transfer Restricted Securities pursuant to any Registration Statement contemplated by this Agreement, all to such extent as may be reasonably requested by any Initial Purchaser or by any Holder of Transfer Restricted Securities or underwriter in connection with any sale or resale pursuant to any Registration Statement contemplated by this Agreement; and whether or not an underwriting agreement is entered into and whether or not the registration is an Underwritten Registration, each of the Issuers and the Guarantors shall:

(A) furnish to each Initial Purchaser, each selling Holder and each underwriter, if any, in such substance and scope as they may request and as are customarily made by issuers to underwriters in primary underwritten offerings, upon the date of the Consummation of the Exchange Offer or, if applicable, the effectiveness of the Shelf Registration Statement:

(1) a certificate, dated the date of Consummation of the Exchange Offer or the date of effectiveness of the Shelf Registration Statement, as the case may be, signed by (y) the President or any Vice President and (z) a principal financial or accounting officer of each of the Issuers and the Guarantors or other officers, directors or authorized signatories reasonably satisfactory to the Initial Purchasers to the extent such entities do not have the specific officers outlined in this sentence, confirming, as of the date thereof, the matters set forth in Section 5(e) of the Purchase Agreement and such other matters as such parties may reasonably request;

(2) an opinion, dated the date of Consummation of the Exchange Offer or the date of effectiveness of the Shelf Registration Statement, as the case may be, of counsel for the Issuers and the Guarantors, covering the matters set forth in Section 5(c) of the Purchase Agreement and such other matter as such parties may reasonably request, and in any event including a statement to the effect that such counsel has participated in conferences with officers and other representatives of the Issuers and the Guarantors, representatives of the independent public accountants for the Issuers and the Guarantors, representatives of the underwriter(s), if any, and counsel to the underwriter(s), if any, in connection with the preparation of such Registration Statement and the related Prospectus and have considered the matters required to be stated therein and the statements contained therein, although such counsel has not independently verified the accuracy, completeness or fairness of such statements; and that such counsel advises that, on the basis of the foregoing, no facts came to such counsel’s attention that caused such counsel to believe that the applicable

 

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Registration Statement, at the time such Registration Statement or any post-effective amendment thereto became effective, and, in the case of the Exchange Offer Registration Statement, as of the date of Consummation, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus contained in such Registration Statement as of its date and, in the case of the opinion dated the date of Consummation of the Exchange Offer, as of the date of Consummation, contained an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein not misleading. Without limiting the foregoing, such counsel may state further that such counsel assumes no responsibility for, and has not independently verified, the accuracy, completeness or fairness of the financial statements, notes and schedules and other financial data included in any Registration Statement contemplated by this Agreement or the related Prospectus; and

(3) customary comfort letters, dated the date of effectiveness of the Shelf Registration Statement, from the Issuers’ independent accountants, in the customary form and covering matters of the type customarily requested to be covered in comfort letters by underwriters in connection with primary underwritten offerings, and covering or affirming the matters set forth in the comfort letters delivered pursuant to Section 5(a) of the Purchase Agreement, without exception;

(B) set forth in full or incorporate by reference in the underwriting agreement, if any, the indemnification provisions and procedures of Section 8 hereof with respect to all parties to be indemnified pursuant to said Section; and

(C) deliver such other documents and certificates as may be reasonably requested by such parties to evidence compliance with Section 6(c)(xi)(A) hereof and with any customary conditions contained in the underwriting agreement or other agreement entered into by the Issuers or any of the Guarantors pursuant to this Section 6(c)(xi), if any.

If at any time the representations and warranties of the Issuers and the Guarantors contemplated in Section 6(c)(xi)(A)(1) hereof cease to be true and correct, the Issuers or the Guarantors shall so advise the Initial Purchasers and the underwriter(s), if any, and each selling Holder promptly and, if requested by such Persons, shall confirm such advice in writing;

(xii) prior to any public offering of Transfer Restricted Securities, cooperate with the selling Holders, the underwriter(s), if any, and their respective counsel in connection with the registration and qualification of the Transfer Restricted Securities under the state securities or blue sky laws of such jurisdictions as the selling Holders or underwriter(s), if any, may request and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Transfer Restricted Securities

 

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covered by the Shelf Registration Statement; provided, however, that none of the Issuers nor the Guarantors shall be required to register or qualify as a foreign corporation where it is not then so qualified or to take any action that would subject it to the service of process in suits or to taxation, other than as to matters and transactions relating to the Registration Statement, in any jurisdiction where it is not then so subject;

(xiii) shall issue, upon the request of any Holder of Initial Securities covered by the Shelf Registration Statement, Exchange Securities having an aggregate principal amount equal to the aggregate principal amount of Initial Securities surrendered to the Issuers by such Holder in exchange therefor or being sold by such Holder; such Exchange Securities to be registered in the name of such Holder or in the name of the purchaser(s) of such Securities, as the case may be; in return, the Initial Securities held by such Holder shall be surrendered to the Issuers for cancellation;

(xiv) cooperate with the selling Holders and the underwriter(s), if any, to facilitate the timely preparation and delivery of certificates representing Transfer Restricted Securities to be sold and not bearing any restrictive legends; and enable such Transfer Restricted Securities to be in such denominations and registered in such names as the Holders or the underwriter(s), if any, may request at least two Business Days prior to any sale of Transfer Restricted Securities made by such Holders or underwriter(s);

(xv) use its commercially reasonable efforts to cause the Transfer Restricted Securities covered by the Registration Statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the seller or sellers thereof or the underwriter(s), if any, to consummate the disposition of such Transfer Restricted Securities, subject to the proviso contained in Section 6(c)(xii) hereof;

(xvi) if any fact or event contemplated by Section 6(c)(iii)(D) hereof shall exist or have occurred, prepare a supplement or post-effective amendment to the Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of Transfer Restricted Securities, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein not misleading;

(xvii) provide a CUSIP number for all Securities not later than the effective date of the Registration Statement covering such Securities and provide the Trustee under the Indenture with printed certificates for such Securities which are in a form eligible for deposit with the Depository Trust Company and take all other action necessary to ensure that all such Securities are eligible for deposit with the Depository Trust Company;

(xviii) cooperate and assist in any filings required to be made with the FINRA and in the performance of any due diligence investigation by any underwriter (including any “qualified independent underwriter”) that is required to be retained in accordance with the rules and regulations of the FINRA;

 

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(xix) otherwise use its commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, and make generally available to its security holders, as soon as practicable, a consolidated earnings statement meeting the requirements of Rule 158 (which need not be audited) for the twelve-month period (A) commencing at the end of any fiscal quarter in which Transfer Restricted Securities are sold to underwriters in a firm commitment or best efforts Underwritten Offering or (B) if not sold to underwriters in such an offering, beginning with the first month of the each of the Issuers’ first fiscal quarter commencing after the effective date of the Registration Statement; and

(xx) cause the Indenture to be qualified under the Trust Indenture Act not later than the effective date of the first Registration Statement required by this Agreement, and, in connection therewith, cooperate with the Trustee and the Holders of Securities to effect such changes to the Indenture as may be required for such Indenture to be so qualified in accordance with the terms of the Trust Indenture Act; and to execute and use its commercially reasonable efforts to cause the Trustee to execute, all documents that may be required to effect such changes and all other forms and documents required to be filed with the Commission to enable such Indenture to be so qualified in a timely manner.

Each Holder agrees by acquisition of a Transfer Restricted Security that, upon receipt of any notice from the Issuers of the existence of any fact of the kind described in Section 6(c)(iii)(D) hereof, such Holder will forthwith discontinue disposition of Transfer Restricted Securities pursuant to the applicable Registration Statement until such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof, or until it is advised in writing (the “Advice”) by the Issuers that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus. If so directed by the Issuers, each Holder will deliver to the Issuers (at the Issuers’ expense) all copies, other than permanent file copies then in such Holder’s possession, of the Prospectus covering such Transfer Restricted Securities that was current at the time of receipt of such notice. In the event the Issuers shall give any such notice, the time period regarding the effectiveness of such Registration Statement set forth in Section 3 or 4 hereof, as applicable, shall be extended by the number of days during the period from and including the date of the giving of such notice pursuant to Section 6(c)(iii)(D) hereof to and including the date when each selling Holder covered by such Registration Statement shall have received the copies of the supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof or shall have received the Advice; provided, however, that no such extension shall be taken into account in determining whether Additional Interest is due pursuant to Section 5 hereof or the amount of such Additional Interest, it being agreed that the Issuers’ option to suspend use of a Registration Statement pursuant to this paragraph shall be treated as a Registration Default for purposes of Section 5 hereof.

SECTION 7. Registration Expenses.

(a) All expenses incident to the Issuers’ and the Guarantors’ performance of or compliance with this Agreement will be borne by the Issuers and the Guarantors, jointly and severally, regardless of whether a Registration Statement becomes effective, including, without limitation:

 

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(i) all registration and filing fees and expenses (including filings made by any Initial Purchaser or Holder with the FINRA (and, if applicable, the fees and expenses of any “qualified independent underwriter” and its counsel that may be required by the rules and regulations of the FINRA)); (ii) all fees and expenses of compliance with federal securities and state securities or blue sky laws; (iii) all expenses of printing (including printing certificates for the Exchange Securities to be issued in the Exchange Offer and printing of Prospectuses), messenger and delivery services and telephone; (iv) all fees and disbursements of counsel for the Issuers, the Guarantors and, subject to Section 7(b) hereof, the Holders of Transfer Restricted Securities; (v) all application and filing fees in connection with listing the Exchange Securities on a securities exchange or automated quotation system pursuant to the requirements thereof; and (vi) all fees and disbursements of independent certified public accountants of the Issuers and the Guarantors (including the expenses of any special audit and comfort letters required by or incident to such performance).

Each of the Issuers and the Guarantors will, in any event, bear its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any Person, including special experts, retained by the Issuers or the Guarantors.

(b) In connection with any Registration Statement required by this Agreement (including, without limitation, the Exchange Offer Registration Statement and the Shelf Registration Statement), the Issuers and the Guarantors, jointly and severally, will reimburse the Initial Purchasers and the Holders of Transfer Restricted Securities being tendered in the Exchange Offer and/or resold pursuant to the “Plan of Distribution” contained in the Exchange Offer Registration Statement or registered pursuant to the Shelf Registration Statement, as applicable, for the reasonable fees and disbursements of not more than one counsel, who shall be Cahill Gordon & Reindel LLP or such other counsel as may be chosen by the Holders of a majority in principal amount of the Transfer Restricted Securities for whose benefit such Registration Statement is being prepared.

SECTION 8. Indemnification.

(a) The Issuers and the Guarantors, jointly and severally, agree to indemnify and hold harmless (i) each Holder and (ii) each Person, if any, who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of the Persons referred to in this clause (ii) being hereinafter referred to as a “controlling person”) and (iii) the respective officers, directors, partners, employees, representatives and agents of any Holder or any controlling person (any Person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an “Indemnified Holder”), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, actions and expenses (including, without limitation, and as incurred, reimbursement of all reasonable costs of investigating, preparing, pursuing, settling, compromising, paying or defending any claim or action, or any investigation or proceeding by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to any Indemnified Holder), joint or several, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement or Prospectus

 

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(or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or expenses are caused by an untrue statement or omission or alleged untrue statement or omission that is made in reliance upon and in conformity with information relating to any of the Holders furnished in writing to the Issuers by any of the Holders expressly for use therein. This indemnity agreement shall be in addition to any liability which either of the Issuers or any of the Guarantors may otherwise have.

In case any action or proceeding (including any governmental or regulatory investigation or proceeding) shall be brought or asserted against any of the Indemnified Holders with respect to which indemnity may be sought against the Issuers or the Guarantors, such Indemnified Holder (or the Indemnified Holder controlled by such controlling person) shall promptly notify the Issuers and the Guarantors in writing; provided, however, that the failure to give such notice shall not relieve any of the Issuers or the Guarantors of its obligations pursuant to this Agreement. Such Indemnified Holder shall have the right to employ its own counsel in any such action and the fees and expenses of such counsel shall be paid, as incurred, by the Issuers and the Guarantors (regardless of whether it is ultimately determined that an Indemnified Holder is not entitled to indemnification hereunder). The Issuers and the Guarantors shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) at any time for such Indemnified Holders, which firm shall be designated by the Holders. The Issuers and the Guarantors shall be liable for any settlement of any such action or proceeding effected with the Issuers’ and the Guarantors’ prior written consent, which consent shall not be withheld unreasonably, and each of the Issuers and the Guarantors agrees to indemnify and hold harmless any Indemnified Holder from and against any loss, claim, damage, liability or expense by reason of any settlement of any action effected with the written consent of the Issuers and the Guarantors. The Issuers and the Guarantors shall not, without the prior written consent of each Indemnified Holder, settle or compromise or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, claim, litigation or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not any Indemnified Holder is a party thereto), unless such settlement, compromise, consent or termination includes an unconditional release of each Indemnified Holder from all liability arising out of such action, claim, litigation or proceeding.

(b) Each Holder of Transfer Restricted Securities agrees, severally and not jointly, to indemnify and hold harmless the Issuers, the Guarantors and their respective directors, officers of the Issuers and the Guarantors who sign a Registration Statement, and any Person controlling (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) either of the Issuers or any of the Guarantors, and the respective officers, directors, partners, employees, representatives and agents of each such Person (any Person referred to in clause (i) or (ii) may hereinafter be referred to as an “Issuer Indemnified Party”), to the same extent as the foregoing indemnity from the Issuers and the Guarantors to each of the Indemnified Holders, but only with respect to claims and actions based on information relating to such Holder furnished in writing by such Holder expressly for use in any Registration Statement. In case any action or proceeding shall be brought against an Issuer Indemnified Party in respect of which indemnity

 

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may be sought against a Holder of Transfer Restricted Securities, such Holder shall have the rights and duties given the Issuers and the Guarantors, and the Issuer Indemnified Parties shall have the rights and duties given to each Holder by the preceding paragraph.

(c) If the indemnification provided for in this Section 8 is unavailable to an indemnified party under Section 8(a) or (b) hereof (other than by reason of exceptions provided in those Sections) in respect of any losses, claims, damages, liabilities, judgments, actions or expenses referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative benefits received by the Issuers and the Guarantors, on the one hand, and the Holders, on the other hand, from the Initial Placement (which in the case of the Issuers and the Guarantors shall be deemed to be equal to the total gross proceeds to the Issuers and the Guarantors from the Initial Placement), the amount of Additional Interest which did not become payable as a result of the filing of the Registration Statement resulting in such losses, claims, damages, liabilities, judgments actions or expenses, and such Registration Statement, or if such allocation is not permitted by applicable law, the relative fault of the Issuers and the Guarantors, on the one hand, and the Holders, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of the Issuers on the one hand and of the Indemnified Holder on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by either of the Issuers or any of the Guarantors, on the one hand, or the Indemnified Holders, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 8(a) hereof, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim.

The Issuers, the Guarantors and each Holder of Transfer Restricted Securities agree that it would not be just and equitable if contribution pursuant to this Section 8(c) were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8, none of the Holders (and its related Indemnified Holders) shall be required to contribute, in the aggregate, any amount in excess of the amount by which the total discount received by such Holder with respect to the Initial Securities exceeds the amount of any damages which such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. The Holders’ obligations to contribute

 

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pursuant to this Section 8(c) are several in proportion to the respective principal amount of Initial Securities held by each of the Holders hereunder and not joint.

SECTION 9. Rule 144A. Each of the Issuers and the Guarantors hereby agrees with each Holder, for so long as any Transfer Restricted Securities remain outstanding and during any period in which the Issuers or the Guarantors are not subject to Section 13 of 15(d), to make available to any Holder or beneficial owner of Transfer Restricted Securities in connection with any sale thereof and any prospective purchaser of such Transfer Restricted Securities from such Holder or beneficial owner, the information required by Rule 144A(d)(4) under the Securities Act in order to permit resales of such Transfer Restricted Securities pursuant to Rule 144A under the Securities Act.

SECTION 10. Participation in Underwritten Registrations. No Holder may participate in any Underwritten Registration hereunder unless such Holder (a) agrees to sell such Holder’s Transfer Restricted Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all reasonable questionnaires, powers of attorney, indemnities, underwriting agreements, lock-up letters and other documents required under the terms of such underwriting arrangements.

SECTION 11. Selection of Underwriters. The Holders of Transfer Restricted Securities covered by the Shelf Registration Statement who desire to do so may sell such Transfer Restricted Securities in an Underwritten Offering. In any such Underwritten Offering, the investment banker(s) and managing underwriter(s) that will administer such offering will be selected by the Holders of a majority in aggregate principal amount of the Transfer Restricted Securities included in such offering; provided, however, that such investment banker(s) and managing underwriter(s) must be reasonably satisfactory to the Issuers.

SECTION 12. Miscellaneous.

(a) Remedies. Each of the Issuers and the Guarantors hereby agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agree to waive the defense in any action for specific performance that a remedy at law would be adequate.

(b) No Inconsistent Agreements. Each of the Issuers and the Guarantors will not on or after the date of this Agreement enter into any agreement with respect to its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. Neither of the Issuers nor any of the Guarantors has previously entered into any agreement granting any registration rights with respect to its securities to any Person. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of either of the Issuers’ or any of the Guarantors’ securities under any agreement in effect on the date hereof.

(c) Adjustments Affecting the Securities. The Issuers will not take any action, or permit any change to occur, with respect to the Securities that would materially and adversely affect the ability of the Holders to Consummate any Exchange Offer.

 

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(d) Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to or departures from the provisions hereof may not be given unless the Issuers have (i) in the case of Section 5 hereof and this Section 12(d)(i), obtained the written consent of Holders of all outstanding Transfer Restricted Securities and (ii) in the case of all other provisions hereof, obtained the written consent of Holders of a majority of the outstanding principal amount of Transfer Restricted Securities (excluding any Transfer Restricted Securities held by the Issuers or their respective Affiliates). Notwithstanding the foregoing, a waiver or consent to departure from the provisions hereof that relates exclusively to the rights of Holders whose securities are being tendered pursuant to the Exchange Offer and that does not affect directly or indirectly the rights of other Holders whose securities are not being tendered pursuant to such Exchange Offer may be given by the Holders of a majority of the outstanding principal amount of Transfer Restricted Securities being tendered or registered; provided, however, that, with respect to any matter that directly or indirectly affects the rights of any Initial Purchaser hereunder, the Issuers shall obtain the written consent of each such Initial Purchaser with respect to which such amendment, qualification, supplement, waiver, consent or departure is to be effective.

(e) Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, first-class mail (registered or certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight delivery:

(i) if to a Holder, at the address set forth on the records of the Registrar under the Indenture, with a copy to the Registrar under the Indenture or posted through the facilities of the Depository Trust Company; and

(ii) if to the Issuers:

Pinafore, Inc.

Pinafore, LLC

1551 Wewatta Street

Denver, Colorado 80202

United States

Facsimile: 303-744-4761

Attention: Kathleen Sullivan

With a copy to:

Latham & Watkins LLP

555 Eleventh Street, NW, Suite 1000

Washington, D.C. 20004

Facsimile: 202-637-2201

Attention: Rachel W. Sheridan and Patrick H. Shannon

All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if

 

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telecopied; and on the next Business Day, if timely delivered to an air courier guaranteeing overnight delivery.

Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee at the address specified in the Indenture.

(f) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including, without limitation, and without the need for an express assignment, subsequent Holders of Transfer Restricted Securities; provided, however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquired Transfer Restricted Securities from such Holder.

(g) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

(h) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICTS OF LAW RULES THEREOF.

(j) Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Registration Rights Agreement or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and, subject to the final sentence of this Section 12(j), each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court. The Trustee reserves the right to bring an action in any court that has jurisdiction over the trust estate, which may be a court other than the Specified Courts, when seeking a direction from a court in the administration of the trust estate.

 

-20-

(k) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby.

(l) Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted by the Issuers with respect to the Transfer Restricted Securities. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

 

-21-

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

 

PINAFORE, LLC
By:   /s/ Donald West
  Name: Donald West
  Title: Authorized Officer

 

PINAFORE, INC.
By:   /s/ Donald West
  Name: Donald West
  Title: Authorized Officer

 

-22-

The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written:

 

BANC OF AMERICA SECURITIES LLC
CITIGROUP GLOBAL MARKETS, INC.
BARCLAYS CAPITAL INC.
RBC CAPITAL MARKETS CORPORATION
UBS SECURITIES LLC
By:    Banc of America Securities LLC
By:   

/s/ William Pegler

  

William Pegler

Director

 

-23-

CARRIAGE HOUSE FRUIT COMPANY BROADWAY MISSISSIPPI DEVELOPMENT, LLC

GATES DEVELOPMENT CORPORATION

GATES INTERNATIONAL HOLDINGS, LLC

AIR SYSTEM COMPONENTS, INC.

AQUATIC CO.

AQUATIC TRUCKING CO.

BUFFALO HOLDING COMPANY

CONERGICS CORPORATION

DEXTER AXLE ACQUISITION CORP.

DEXTER AXLE COMPANY

DEXTER AXLE TRUCKING COMPANY

EPICOR INDUSTRIES, INC.

GATES MECTROL, INC.

 

HART & COOLEY TRUCKING COMPANY

HART & COOLEY, INC.

NRG INDUSTRIES, INC. (Delaware entity)

PLEWS, INC.

RUSKIN COMPANY

RUSKIN SERVICE COMPANY

SCHRADER ELECTRONICS, INC.

SCHRADER INTERNATIONAL HOLDING CO.

SHRADER, LLC

SHRADER-BRIDGEPORT INTERNATIONAL, INC.

SELKIRK AMERICAS, L.P.

SELKIRK CANADA HOLDINGS, L.P.

SELKIRK CORPORATION

SELKIRK IP L.L.C.

THE GATES CORPORATION

TOMKINS AUTOMOTIVE HOLDING CO.

TOMKINS CORPORATION

TOMKINS U.S., L.P.

WALTHAM REAL ESTATE HOLDING CO.

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Registration Rights Agreement Signature Page

E INDUSTRIES, INC.

KOCH FILTER CORPORATION

DEXTER CHASSIS GROUP, INC.

EASTERN SHEET METAL, INC.

FBN TRANSPORTATION, INC.

TOMKINS INDUSTRIES, INC.

IDEAL CLAMP PRODUCTS, INC.

GLASS MASTER CORPORATION

NATIONAL DUCT SYSTEMS, INC.

NRG INDUSTRIES, INC. (Texas entity)

ROOFTOP SYSTEMS, INC.

HYTEC, INC.

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Registration Rights Agreement Signature Page

ACD TRIDON (HOLDINGS) LIMITED

AIR SYSTEMS COMPONENTS INVESTMENTS

CHINA LIMITED

BETA NACO LIMITED

BRITISH INDUSTRIAL VALVE COMPANY LIMITED

GATES ENGINEERING & SERVICES UK

HOLDINGS LIMITED

GATES FLUID POWER TECHNOLOGIES

INVESTMENTS LIMITED

GATES HOLDINGS LIMITED

H HEATON LIMITED

OLYMPUS (ORMSKIRK) LIMITED

RUSKIN AIR MANAGEMENT LIMITED

SHITAKE LIMITED

STACKPOLE INVESTMENTS LIMITED

SWINDON SILICON SYSTEMS LIMITED

TOMKINS ENGINEERING LIMITED

TOMKINS FINANCE LUXEMBOURG LIMITED

TOMKINS FINANCE LIMITED

TOMKINS FUNDING LIMITED

TOMKINS IDEAL CLAMPS (SUZHOU)

INVESTMENTS LIMITED

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Registration Rights Agreement Signature Page

TOMKINS INVESTMENTS CHINA LIMITED

TOMKINS INVESTMENTS LIMITED

TOMKINS OVERSEAS COMPANY

TOMKINS OVERSEAS INVESTMENTS LIMITED

TOMKINS PENSION SERVICES LIMITED

TOMKINS LIMITED

TOMKINS SCI LIMITED

TOMKINS STERLING COMPANY

TOMKINS TREASURY (CANADIAN DOLLAR) COMPANY

TOMKINS TREASURY (DOLLAR) COMPANY

TOMKINS TREASURY (EURO) COMPANY

TRICO PRODUCTS (DUNSTABLE) LIMITED

WILLER & RILEY LIMITED

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Registration Rights Agreement Signature Page

PINAFORE HOLDINGS B.V.
By:   /s/ Donald West
  Name: Donald West
  Title: Authorized Officer

Registration Rights Agreement Signature Page

MONTISK INVESTMENTS NETHERLANDS, C.V.
By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

 

Registration Rights Agreement Signature Page

SCHRADER INVESTMENTS LUXEMBOURG S.AR.L.

TOMKINS AMERICAN INVESTMENTS S.A.R.L.

TOMKINS AUTOMOTIVE COMPANY, S.A.R.L.

TOMKINS HOLDINGS LUXEMBOURG, S.A.R.L.

TOMKINS INVESTMENT COMPANY S.A.R.L.

TOMKINS LUXEMBOURG S.A.R.L.

TOMKINS OVERSEAS HOLDINGS S.A.R.L.

By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

Registration Rights Agreement Signature Page

PINAFORE ACQUISITIONS LIMITED
By:   /s/ Todd Clegg
  Name: Todd Clegg
  Title: Authorized Officer

Registration Rights Agreement Signature Page

GATES AUTO PARTS HOLDINGS CHINA LIMITED
By:   /s/ John Zimmerman
  Name: John Zimmerman
  Title: Authorized Officer

 

Registration Rights Agreement Signature Page

Schedule 1

CARRIAGE HOUSE FRUIT COMPANY

BROADWAY MISSISSIPPI DEVELOPMENT, LLC

GATES DEVELOPMENT CORPORATION

GATES INTERNATIONAL HOLDINGS, LLC

AIR SYSTEM COMPONENTS, INC.

AQUATIC CO.

AQUATIC TRUCKING CO.

BUFFALO HOLDING COMPANY

CONERGICS CORPORATION

DEXTER AXLE ACQUISITION CORP.

DEXTER AXLE COMPANY

DEXTER AXLE TRUCKING COMPANY

EPICOR INDUSTRIES, INC.

GATES MECTROL, INC.

GATES WINHERE, LLC

HART & COOLEY TRUCKING COMPANY

HART & COOLEY, INC.

NRG INDUSTRIES, INC. (Delaware entity)

PLEWS, INC.

RUSKIN COMPANY

RUSKIN SERVICE COMPANY

SCHRADER ELECTRONICS, INC.

SCHRADER INTERNATIONAL HOLDING CO.

SCHRADER, LLC

SCHRADER-BRIDGEPORT INTERNATIONAL, INC.

SELKIRK AMERICAS, L.P.

SELKIRK CANADA HOLDINGS, L.P.

SELKIRK CORPORATION

SELKIRK IP L.L.C.

THE GATES CORPORATION

TOMKINS AUTOMOTIVE HOLDING CO.

TOMKINS CORPORATION

TOMKINS U.S., L.P.

WALTHAM REAL ESTATE HOLDING CO.

E INDUSTRIES, INC.

KOCH FILTER CORPORATION

DEXTER CHASSIS GROUP, INC.

EASTERN SHEET METAL, INC.

FBN TRANSPORTATION, INC.

TOMKINS INDUSTRIES, INC.

IDEAL CLAMP PRODUCTS, INC.

GLASS MASTER CORPORATION

NATIONAL DUCT SYSTEMS, INC.

NRG INDUSTRIES, INC. (Texas entity) ROOFTOP SYSTEMS, INC.

HYTEC, INC.

ACD TRIDON (HOLDINGS) LIMITED

AIR SYSTEMS COMPONENTS INVESTMENTS CHINA LIMITED

BETA NACO LIMITED

BRITISH INDUSTRIAL VALVE COMPANY LIMITED

GATES AUTO PARTS HOLDINGS CHINA LIMITED

GATES ENGINEERING & SERVICES UK HOLDINGS LIMITED

GATES FLUID POWER TECHNOLOGIES INVESTMENTS LIMITED

GATES HOLDINGS LIMITED

H HEATON LIMITED

OLYMPUS (ORMSKIRK) LIMITED

RUSKIN AIR MANAGEMENT LIMITED

SHIITAKE LIMITED

STACKPOLE INVESTMENTS LIMITED

SWINDON SILICON SYSTEMS LIMITED

TOMKINS ENGINEERING LIMITED

TOMKINS FINANCE LUXEMBOURG LIMITED

TOMKINS FINANCE LIMITED

TOMKINS FUNDING LIMITED

TOMKINS IDEAL CLAMPS (SUZHOU) INVESTMENTS LIMITED

TOMKINS INVESTMENTS CHINA LIMITED

TOMKINS INVESTMENTS LIMITED

TOMKINS OVERSEAS COMPANY

TOMKINS OVERSEAS INVESTMENTS LIMITED

TOMKINS PENSION SERVICES LIMITED

TOMKINS LIMITED

TOMKINS SC1 LIMITED

TOMKINS STERLING COMPANY

TOMKINS TREASURY (CANADIAN DOLLAR) COMPANY

TOMKINS TREASURY (DOLLAR) COMPANY

TOMKINS TREASURY (EURO) COMPANY

TRICO PRODUCTS (DUNSTABLE) LIMITED

WILLER & RILEY LIMITED

PINAFORE HOLDINGS B.V.

MONTISK INVESTMENTS NETHERLANDS C.V.

SCHRADER INVESTMENTS LUXEMBOURG S.À R.L.

TOMKINS AMERICAN INVESTMENTS S.À R.L.

TOMKINS AUTOMOTIVE COMPANY, S.À R.L.

TOMKINS HOLDINGS LUXEMBOURG, S.À R.L.

TOMKINS INVESTMENT COMPANY S.À R.L.

TOMKINS LUXEMBOURG S.À R.L.

TOMKINS OVERSEAS HOLDINGS S.À R.L.

 

-2-

Exhibit A

FORM OF JOINDER AGREEMENT

[            ], 2010

BANC OF AMERICA SECURITIES LLC

CITIGROUP GLOBAL MARKETS INC.

BARCLAYS CAPITAL INC.

RBC CAPITAL MARKETS CORPORATION

UBS SECURITIES LLC

      As Representatives of the Initial Purchasers

c/o Banc of America Securities LLC

One Bryant Park

New York, New York 10036

Reference is hereby made to that registration rights agreement (the “Registration Rights Agreement”) dated as of September 29, 2010 among Pinafore, LLC, a Delaware limited liability company (“LLC Co-Issuer”), and Pinafore, Inc., a Delaware corporation (“Corporate Co-Issuer”, and together with LLC Co-Issuer, the “Issuers”), Holdings, the other Guarantors party thereto and the Initial Purchasers relating to the $1,150,000,000 aggregate principal amount of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Notes”). Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Registration Rights Agreement.

In connection with the Acquisition (as defined in the Purchase Agreement), the undersigned have guaranteed the Notes. This Joinder Agreement is being executed and delivered by the undersigned, after giving effect to the Acquisition.

1. Joinder. Each of the undersigned hereby acknowledges that it has received a copy of the Registration Rights Agreement and acknowledges and agrees with the Initial Purchasers that by its execution and delivery hereof it shall (i) join and become a party to the Registration Rights Agreement; (ii) be bound by all covenants, agreements, representations, warranties and acknowledgements applicable to such party as set forth in and in accordance with the terms of the Registration Rights Agreement; and (iii) perform all obligations and duties as required of it in accordance with the Registration Rights Agreement. Each of the undersigned hereby represents and warrants that the representations and warranties set forth in the Registration Rights Agreement applicable to such party are true and correct on and as of the Closing Date in all material respects (except to the extent already qualified by materiality) with the same force and effect as if such representations and warranties had been made on and as of the Closing Date (except that representations and warranties made as of a particular date were true and correct on and as of such particular date).

2. Counterparts. This Joinder Agreement may be signed in one or more counterparts (which may be delivered in original form or facsimile or “pdf” file thereof), each of which shall

constitute an original when so executed and all of which together shall constitute one and the same agreement.

3. Amendments. No amendment or waiver of any provision of this Joinder Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties thereto.

4. Headings. The section headings used herein are for convenience only and shall not affect the construction hereof.

5. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS JOINDER AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

(m) Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Joinder Agreement or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and each party irrevocably submits to the non-exclusive jurisdiction of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum. Each party not located in the United States irrevocably appoints Pinafore, LLC as its agent to receive service of process or other legal summons for purposes of any Related Proceeding that may be instituted in any Specified Court.

(n) Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with respect to any Related Judgment, each party waives any such immunity in the Specified Courts or any other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such immunity at or in respect of any such Related Proceeding or Related Judgment, including, without limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as amended.

IN WITNESS WHEREOF, each of the undersigned has caused this Joinder Agreement to be duly executed and delivered by its proper and duly authorized officer as of the date set forth above.

 

[GUARANTOR]
By:  

 

  Name:
  Title:

The foregoing Joinder Agreement is hereby confirmed and accepted by the Initial Purchasers as of the date first above written.

 

BANC OF AMERICA SECURITIES LLC
 

Acting on behalf of itself

and as Representative of

the several Initial Purchasers

  By:  

 

    Name:
    Title:
CITIGROUP GLOBAL MARKETS INC.
 

Acting on behalf of itself

and as Representative of

the several Initial Purchasers

  By:  

 

    Name:
    Title:
BARCLAYS CAPITAL INC.
 

Acting on behalf of itself

and as Representative of

the several Initial Purchasers

  By:  

 

    Name:
    Title:
RBC CAPITAL MARKETS CORPORATION
 

Acting on behalf of itself

and as Representative of

the several Initial Purchasers

  By:  

 

    Name:
    Title:
UBS SECURITIES LLC

Acting on behalf of itself

and as Representative of

the several Initial Purchasers

By:  

 

  Name:
  Title:
By:  

 

  Name:
  Title:
 EX-4.11 19 dex411.htm EXHIBIT 4.11 Exhibit 4.11

Exhibit 4.11

THIRD SUPPLEMENTAL TRUST DEED

modifying and restating the provisions of

the Trust Deed dated 26th October, 2001

(as previously modified and restated)

relating to the

£750,000,000

Euro Medium Term Note Programme

DATED 28TH AUGUST, 2003

TOMKINS FINANCE PLC

- AND -

TOMKINS PLC

- AND -

THE LAW DEBENTURE TRUST CORPORATION p.l.c.

FOR TOMKINS FINANCE PLC AND TOMKINS PLC AS TO ENGLISH LAW:

SLAUGHTER AND MAY

ONE BUNHILL ROW

LONDON EC1Y 8YY

FOR THE LAW DEBENTURE TRUST CORPORATION p.l.c.

AS TO ENGLISH LAW:

ALLEN & OVERY

London

 

 

CONTENTS

 

Clause         Page  

1.

   

Definitions

      1   

2.

   

Amount and Issue of the Notes

      12   

3.

   

Forms of the Notes

      15   

4.

   

Fees, Duties and Taxes

      17   

5.

   

Covenant of Compliance

      17   

6.

   

Cancellation of Notes and Records

      17   

7.

   

Guarantee

      18   

8.

   

Non-Payment

      21   

9.

   

Proceedings, Action and Indemnification

      21   

10.

   

Application of Moneys

      21   

11.

   

Notice of Payments

      22   

12.

   

Investment by Trustee

      22   

13.

   

Partial Payments

      22   

14.

   

Covenants by the Issuer and the Guarantor

      22   

15.

   

Remuneration and Indemnification of Trustee

      26   

16.

   

Supplement to Trustee Acts

      27   

17.

   

Trustee’s Liability

      31   

18.

   

Trustee Contracting with the Issuer and the Guarantor

      31   

19.

   

Waiver, Authorisation and Determination

      32   

20.

   

Holder of Definitive Note assumed to be Receiptholder and Couponholder

      33   

21.

   

Currency Indemnity

      33   

22.

   

New Trustee

      34   

23.

   

Substitution

      34   

24.

   

Trustee’s Retirement and Removal

      35   

25.

   

Trustee’s Powers to be Additional

      36   

26.

   

Notices

      36   

27.

   

Governing Law

      37   

28.

   

Contracts (Rights of Third Parties) Act 1999

      37   

29.

   

Counterparts

      37   

Schedule

 

1.

   

Terms and Conditions of the Notes

      38   

2.

   

Forms of Global and Definitive Notes, Receipts, Coupons and Talons

      60   
  

Part 1

     

Form of Temporary Global Note

      60   
  

Part 2

     

Form of Permanent Global Note

      69   
  

Part 3

     

Form of Definitive Note

      78   
  

Part 4

     

Form of Receipt

      82   
  

Part 5

     

Form of Coupon

      83   
  

Part 6

     

Form of Talon

      84   
  

Part 7

     

Form of Certificate to be presented by Euroclear or Clearstream, Luxembourg

      86   

3.

   

Provisions for Meetings of Noteholders

      90   

 

 

THIS THIRD SUPPLEMENTAL TRUST DEED is made on 28th August, 2003 BETWEEN:

 

(1) TOMKINS FINANCE PLC, a company incorporated under the laws of England and Wales, whose registered office is at East Putney House, 84 Upper Richmond Road, London SW15 2ST, England (Finance);

 

(2) TOMKINS PLC, a company incorporated under the laws of England and Wales, whose registered office is at East Putney House, 84 Upper Richmond Road, London SW15 2ST, England (Tomkins); and

 

(3) THE LAW DEBENTURE TRUST CORPORATION p.l.c., a company incorporated under the laws of England and Wales, whose registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX, England (the Trustee, which expression shall, wherever the context so admits, include such company and all other persons or companies for the time being the trustee or trustees of these presents) as trustee for the Noteholders, the Receiptholders and the Couponholders (each as defined below).

WHEREAS:

 

(A) This Third Supplemental Trust Deed is supplemental to:

 

  (i) the Trust Deed dated 26th October, 2001 (hereinafter called the Principal Trust Deed) made between Tomkins and the Trustee and relating to the £750,000,000 Global (now Euro) Medium Term Note Programme established by Tomkins (the Programme);

 

  (ii) the First Supplemental Trust Deed dated 5th November, 2002 (hereinafter called the First Supplemental Trust Deed) made between Tomkins and the Trustee and modifying and restating the Principal Trust Deed; and

 

  (iii) the Second Supplemental Trust Deed dated 19th August, 2003 made between Tomkins, Finance and the Trustee under which Finance guaranteed repayment of the £150,000,000 8 per cent. Notes due 2011 issued by Tomkins under the Programme (together with the Principal Trust Deed and the First Supplemental Trust Deed, the Subsisting Trust Deeds).

 

(B) On the date hereof Tomkins published a modified and updated Offering Circular relating to the Programme.

 

(C) Clause 18(B) of the Principal Trust Deed provides, inter alia, that the Trustee may without the consent or sanction of the Noteholders, the Receiptholders or the Couponholders at any time and from time to time concur with the Issuer in making any modification to these presents which in the opinion of the Trustee it may be proper to make provided that the Trustee is of the opinion that such modification will not be materially prejudicial to the interests of the Noteholders.

 

(D) Tomkins has been replaced by Finance as the Issuer under the Programme and Tomkins has agreed to guarantee Notes issued under the Programme by Finance on and after the date hereof in the manner described herein.

 

1

 

 

(E) Tomkins has requested the Trustee to concur in making modifications to the Principal Trust Deed to reflect the relevant modifications to the Offering Circular referred to in Recital (D) above.

 

(F) The Trustee, being of the opinion that the modifications referred to in Recital (D) above are not materially prejudicial to the interests of the Noteholders, has concurred with Tomkins in making such modifications and, as evidenced by its execution hereof, has agreed that notice of such modifications need not be given to the Noteholders.

NOW THIS THIRD SUPPLEMENTAL TRUST DEED WITNESSES AND IT IS HEREBY AGREED AND DECLARED AS FOLLOWS:

 

1. Subject as otherwise provided in this Third Supplemental Trust Deed and unless there is something in the subject matter or context inconsistent therewith all words and expressions defined in the Principal Trust Deed shall have the same meanings in this Third Supplemental Trust Deed.

 

2. Save:

 

  (a) in relation to all Series of Notes issued during the period up to and including the day last preceding the date of this Third Supplemental Trust Deed and any Notes issued on or after the date of this Third Supplemental Trust Deed so as to be consolidated and form a single Series with the Notes of any Series issued during the period up to and including such last preceding day; and

 

  (b) for the purpose (where necessary) of construing the provisions of this Third Supplemental Trust Deed,

with effect on and from the date of this Third Supplemental Trust Deed, the Principal Trust Deed is modified in such manner as would result in the Principal Trust Deed being in the form set out in the Schedule hereto.

 

3. The Subsisting Trust Deeds and this Third Supplemental Trust Deed shall henceforth be read and construed as one document.

 

4. A Memorandum of this Third Supplemental Trust Deed shall be endorsed by the Trustee on the Principal Trust Deed and by Tomkins on its duplicate thereof.

IN WITNESS whereof this Third Supplemental Trust Deed has been executed by Finance, Tomkins and the Trustee as a deed and entered into the day and year first above written.

 

2

 

 

SCHEDULE

FORM OF MODIFIED PRINCIPAL TRUST DEED

DATED 26TH OCTOBER, 2001

TOMKINS FINANCE PLC

- and -

TOMKINS PLC

- and -

THE LAW DEBENTURE TRUST CORPORATION p.l.c.

 

 

TRUST DEED

(as modified and restated on 28th August, 2003)

relating to a

£750,000,000

Euro Medium Term Note Programme

 

 

For Tomkins Finance plc and Tomkins plc as to English law:

SLAUGHTER AND MAY

One Bunhill Row

London EC1Y 8YY

For The Law Debenture Trust Corporation p.l.c.

as to English law:

ALLEN & OVERY

One New Change

London EC4M 9QQ

 

 

THIS TRUST DEED is made on 26th October, 2001 BETWEEN:

 

(1) TOMKINS FINANCE PLC, a company incorporated under the laws of England and Wales, whose registered office is at East Putney House, 84 Upper Richmond Road, London SW15 2ST, England (the Issuer or Finance);

 

(2) TOMKINS PLC, a company incorporated under the laws of England and Wales, whose registered office is at East Putney House, 84 Upper Richmond Road, London SW15 2ST (the Guarantor or Tomkins); and

 

(3) THE LAW DEBENTURE TRUST CORPORATION p.l.c., a company incorporated under the laws of England and Wales, whose registered office is at Fifth Floor, 100 Wood Street, London EC2V 7EX (the Trustee, which expression shall, wherever the context so admits, include such company and all other persons or companies for the time being the trustee or trustees of these presents) as trustee for the Noteholders, the Receiptholders and the Couponholders (each as defined below).

WHEREAS:

 

(A) By a resolution of the Board of Directors of the Issuer passed on 28th August, 2003 the Issuer has been duly authorised to accede to and to update the Programme pursuant to which the Issuer may from time to time issue Notes as set out herein. Notes up to a maximum nominal amount (calculated in accordance with Clause 3(6) of the Programme Agreement (as defined below)) from time to time outstanding of £750,000,000 (subject to increase as provided in the Programme Agreement) (the Programme Limit) may be issued pursuant to the said Programme.

 

(B) By a resolution of the Board of Directors of the Guarantor passed on 27th August, 2003 and by a resolution of a committee of the Guarantor delegated to do so by its Board of Directors, passed on 27th August, 2003 the Guarantor has agreed to guarantee the said Notes and to enter into certain covenants as set out in this Trust Deed.

 

(C) The Trustee has agreed to act as trustee of these presents for the benefit of the Noteholders, the Receiptholders and the Couponholders upon and subject to the terms and conditions of these presents.

NOW THIS TRUST DEED WITNESSES AND IT IS AGREED AND DECLARED as follows:

 

1. DEFINITIONS

 

1.1 In these presents unless there is anything in the subject or context inconsistent therewith the following expressions shall have the following meanings:

Agency Agreement means the agreement dated 26th October, 2001 as amended and/or supplemented and/or restated from time to time, pursuant to which the Issuer and the Guarantor have appointed the Agent and the other Paying Agents in relation to all or any Series of the Notes and any other agreement for the time being in force appointing further or other Paying Agents or another principal paying agent in relation to all or any Series of the Notes, or in connection with their duties, the terms of which have previously been approved in writing by the Trustee, together with any agreement for the time being in force amending or modifying with the prior written approval of the Trustee any of the aforesaid agreements;

 

1

 

 

Agent means, in relation to all or any Series of the Notes, The Bank of New York, London Branch at its office at One Canada Square, London E14 5AL, England or, if applicable, any Successor principal paying agent in relation to all or any Series of the Notes;

Appointee means any attorney, manager, agent, delegate or other person appointed by the Trustee under these presents;

Auditors means the auditors for the time being of the Issuer or the Guarantor (as the case may be) or, in the event of their being unable or unwilling promptly to carry out any action requested of them pursuant to the provisions of these presents, such other firm of accountants as may be nominated or approved by the Trustee for the purposes of these presents;

Calculation Agent means, in relation to all or any Series of the Notes, the person initially appointed as calculation agent in relation to such Notes by the Issuer pursuant to the Agency Agreement or, if applicable, any Successor calculation agent in relation to all or any Series of the Notes;

Clearstream, Luxembourg means Clearstream Banking, société anonyme;

Conditions means, in relation to the Notes of any Series, the terms and conditions endorsed on or incorporated by reference into the Note or Notes constituting such Series, such terms and conditions being in or substantially in the form set out in Schedule 1 or in such other form, having regard to the terms of the Notes of the relevant Series, as may be agreed between the Issuer, the Guarantor, the Trustee and the relevant Dealer(s) as modified and supplemented by the Pricing Supplement applicable to the Notes of the relevant Series, in each case as from time to time modified in accordance with the provisions of these presents;

Coupon means an interest coupon appertaining to a definitive Note (other than a Zero Coupon Note), such coupon being:

 

  (a) if appertaining to a Fixed Rate Note, in the form or substantially in the form set out in Part 5A of Schedule 2 or in such other form, having regard to the terms of issue of the Notes of the relevant Series, as may be agreed between the Issuer, the Guarantor, the Agent, the Trustee and the relevant Dealer(s); or

 

  (b) if appertaining to a Floating Rate Note or an Index Linked Interest Note, in the form or substantially in the form set out in Part 5B of Schedule 2 or in such other form, having regard to the terms of issue of the Notes of the relevant Series, as may be agreed between the Issuer, the Guarantor, the Agent, the Trustee and the relevant Dealer(s); or

 

  (c) if appertaining to a definitive Note which is neither a Fixed Rate Note nor a Floating Rate Note nor an Index Linked Interest Note, in such form as may be agreed between the Issuer, the Guarantor, the Agent, the Trustee and the relevant Dealer(s),

and includes, where applicable, the Talon(s) appertaining thereto and any replacements for Coupons and Talons issued pursuant to Condition 12;

Couponholders means the several persons who are for the time being holders of the Coupons and includes, where applicable, the Talonholders;

 

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Dealers means ABN AMRO Bank N.V., Barclays Bank PLC, BNP Paribas, Citigroup Global Markets Limited, Dresdner Bank AG London Branch, HSBC Bank plc, J.P. Morgan Securities Ltd. and UBS Limited and any other entity which the Issuer and the Guarantor may appoint as a Dealer and notice of whose appointment has been given to the Agent and the Trustee by the Issuer in accordance with the provisions of the Programme Agreement but excluding any entity whose appointment has been terminated in accordance with the provisions of the Programme Agreement and notice of such termination has been given to the Agent and the Trustee by the Issuer in accordance with the provisions of the Programme Agreement and references to a relevant Dealer or the relevant Dealer(s) mean, in relation to any Tranche or Series of Notes, the Dealer or Dealers with whom the Issuer and the Guarantor have agreed the issue of the Notes of such Tranche or Series and Dealer means any one of them;

Definitive Note means a Note in definitive form issued or, as the case may require, to be issued by the Issuer in accordance with the provisions of the Programme Agreement or any other agreement between the Issuer, the Guarantor and the relevant Dealer(s), the Agency Agreement and these presents in exchange for either a Temporary Global Note or part thereof or a Permanent Global Note (all as indicated in the applicable Pricing Supplement), such Note in definitive form being in the form or substantially in the form set out in Part III of the Second Schedule with such modifications (if any) as may be agreed between the Issuer, the Guarantor, the Agent, the Trustee and the relevant Dealer(s) and having the Conditions endorsed thereon or, if permitted by the relevant Stock Exchange, incorporating the Conditions by reference as indicated in the applicable Pricing Supplement and having the relevant information supplementing, replacing or modifying the Conditions appearing in the applicable Pricing Supplement endorsed thereon or attached thereto and (except in the case of a Zero Coupon Note) having Coupons and, where appropriate, Receipts and/or Talons attached thereto on issue;

Directors means the Board of Directors for the time being of the Issuer or, as the case may be, the Guarantor;

Dual Currency Interest Note means a Note in respect of which payments of interest are made or to be made in such different currencies, and at rates of exchange calculated upon such basis, as the Issuer, the Guarantor and the relevant Dealer may agree (as indicated in the applicable Pricing Supplement);

Dual Currency Note means a Dual Currency Interest Note and/or a Dual Currency Redemption Note, as applicable;

Dual Currency Redemption Note means a Note in respect of which payments of principal are made or to be made in such different currencies, and at rates of exchange calculated upon such basis, as the Issuer, the Guarantor and the relevant Dealer(s) may agree (as indicated in the applicable Pricing Supplement);

Early Redemption Amount has the meaning ascribed thereto in Condition 8(e);

Euroclear means Euroclear Bank S.A./N.V. as operator of the Euroclear System;

Event of Default means any of the conditions, events or acts provided in Condition 11 to be events upon the happening of which the Notes of any Series would, subject only to notice by the Trustee as therein provided, become immediately due and repayable;

 

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Extraordinary Resolution has the meaning set out in paragraph 20 of 0;

Fixed Rate Note means a Note on which interest is calculated at a fixed rate payable in arrear on a fixed date or fixed dates in each year and on redemption or on such other dates as may be agreed between the Issuer, the Guarantor and the relevant Dealer(s) (as indicated in the applicable Pricing Supplement);

Floating Rate Note means a Note on which interest is calculated at a floating rate payable in arrear in respect of such period or on such date(s) as may be agreed between the Issuer, the Guarantor and the relevant Dealer(s) (as indicated in the applicable Pricing Supplement);

Global Note means a Temporary Global Note and/or a Permanent Global Note, as the context may require;

Index Linked Interest Note means a Note in respect of which the amount payable in respect of interest is calculated by reference to an index and/or a formula as the Issuer, the Guarantor and the relevant Dealer(s) may agree (as indicated in the applicable Pricing Supplement);

Index Linked Note means an Index Linked Interest Note and/or an Index Linked Redemption Note, as applicable;

Index Linked Redemption Note means a Note in respect of which the amount payable in respect of principal is calculated by reference to an index and/or a formula as the Issuer and the relevant Dealer(s) may agree (as indicated in the applicable Pricing Supplement);

Interest Commencement Date means, in the case of interest-bearing Notes, the date specified in the applicable Pricing Supplement from (and including) which such Notes bear interest, which may or may not be the Issue Date;

Interest Payment Date means, in relation to any Floating Rate Note or Index Linked Interest Note, either:

 

  (a) the date which falls the number of months or other period specified as the “Specified Period” in the applicable Pricing Supplement after the preceding Interest Payment Date or the Interest Commencement Date (in the case of the first Interest Payment Date); or

 

  (b) such date or dates as are indicated in the applicable Pricing Supplement;

Issue Date means, in respect of any Note, the date of issue and purchase of such Note pursuant to and in accordance with the Programme Agreement or any other agreement between the Issuer, the Guarantor and the relevant Dealer(s) being, in the case of any Definitive Note represented initially by a Global Note, the same date as the date of issue of the Global Note which initially represented such Note;

Issue Price means the price, generally expressed as a percentage of the nominal amount of the Notes, at which the Notes will be issued;

Liability means any loss, damage, cost, charge, claim, demand, expense, judgment, action, proceeding or other liability whatsoever (including, without limitation in respect of taxes, duties, levies, imposts and other charges) and including any amount in respect of value added

 

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tax or similar tax charged or chargeable in respect thereof and legal fees and expenses on a full indemnity basis;

London Business Day has the meaning set out in Condition 5(b)(v);

London Stock Exchange means the London Stock Exchange plc or such other body to which its functions have been transferred;

Material Subsidiary means at any time a Subsidiary of the Guarantor (excluding the Issuer), as the case may be,:

 

  (a) whose turnover (consolidated in the case of a Subsidiary which itself has Subsidiaries) or whose total assets (consolidated in the case of a Subsidiary which itself has Subsidiaries) represent (or, in the case of a Subsidiary acquired after the end of the financial period to which the then latest relevant audited consolidated accounts of the Guarantor and its Subsidiaries relate, are equal to) not less than 5 per cent. of the consolidated turnover of the Guarantor and its Subsidiaries taken as a whole, or, as the case may be, 15 per cent. of the consolidated total assets of the Guarantor and its Subsidiaries taken as a whole, all as calculated respectively by reference to the then latest audited accounts (consolidated or, as the case may be, unconsolidated) of such Subsidiary and the then latest audited consolidated accounts of the Guarantor and its Subsidiaries, provided that:

 

  (i) in the case of a Subsidiary acquired after the end of the financial period to which the then latest relevant audited consolidated accounts relate, the reference to the then latest audited consolidated accounts for the purposes of the calculation above shall, until consolidated accounts for the financial period in which the acquisition is made have been prepared and audited as aforesaid, be deemed to be a reference to such first-mentioned accounts as if such Subsidiary had been shown in such accounts by reference to its then latest relevant audited accounts, adjusted as deemed appropriate by the Auditors; and

 

  (ii) if, in the case of a Subsidiary which itself has Subsidiaries, no consolidated accounts are prepared and audited, its consolidated turnover and consolidated total assets shall be determined on the basis of pro forma consolidated accounts of the relevant Subsidiary and its Subsidiaries prepared and audited for this purpose by the Auditors or the auditors for the time being of the relevant Subsidiary; or

 

  (b)

to which is transferred (whether by one transaction or a series of transactions, whether related or not) the whole or substantially the whole of the undertaking and assets of a Subsidiary of the Guarantor which immediately prior to such transfer is a Material Subsidiary by virtue of sub-paragraph (a) above, provided that the transferor Subsidiary shall upon such transfer forthwith cease to be a Material Subsidiary and the transferee Subsidiary shall cease to be a Material Subsidiary pursuant to this sub-paragraph (b) on the date on which the consolidated accounts of the Guarantor and its Subsidiaries for the financial period current at the date of such transfer have been prepared and audited as aforesaid but so that such transferor Subsidiary or such transferee Subsidiary may be a Material Subsidiary on or at any time after the date on which such consolidated accounts have been prepared and audited as aforesaid by

 

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virtue of the provisions of sub-paragraph (a) above or before, on or at any time after such date by virtue of the provisions of this sub-paragraph (b) or sub-paragraph (c) below; or

 

  (c) to which is transferred (whether by one transaction or a series of transactions, whether related or not) an undertaking or assets which, taken together with the undertaking or assets of the transferee Subsidiary, generated (or, in the case of the transferee Subsidiary being acquired after the end of the financial period to which the then latest relevant audited consolidated accounts of the Guarantor and its Subsidiaries relate, generate turnover equal to) not less than 5 per cent. of the consolidated turnover of the Guarantor and its Subsidiaries taken as a whole, or represent (or, in the case aforesaid, are equal to) not less than 15 per cent. of the consolidated total assets of the Guarantor and its Subsidiaries taken as a whole, all as calculated as referred to in sub-paragraph (a) above, provided that the transferor Subsidiary (if a Material Subsidiary shall upon such transfer forthwith cease to be a Material Subsidiary unless immediately following such transfer its undertaking and assets generate (or, in the case aforesaid, generate turnover equal to) not less than 5 per cent. of the consolidated turnover of the Guarantor and its Subsidiaries taken as a whole, or its assets represent (or, in the case aforesaid, are equal to) not less than 15 per cent. of the consolidated total assets, of the Guarantor and its Subsidiaries taken as a whole, all as calculated as referred to in sub-paragraph (a) above, and the transferee Subsidiary shall cease to be a Material Subsidiary pursuant to this sub-paragraph (c) on the date on which the consolidated accounts of the Guarantor and its Subsidiaries for the financial period current at the date of such transfer have been prepared and audited but so that such transferor Subsidiary or such transferee Subsidiary may be a Material Subsidiary on or at any time after the date on which such consolidated accounts have been prepared and audited as aforesaid by virtue of the provisions of sub-paragraph (a) above or before, on or at any time after such date by virtue of the provisions of this sub-paragraph (c) or sub-paragraph (b) above.

For the purposes of this definition if there shall at any time not be any relevant audited consolidated accounts of the Guarantor and its Subsidiaries, references thereto herein shall be deemed to refer to a consolidation by the Auditors of the relevant audited accounts of the Guarantor and its Subsidiaries.

The certificate or report of the Auditors that in their opinion a Subsidiary of the Guarantor is or is not or was or was not at any particular time or throughout any specified period a Material Subsidiary may be relied upon by the Trustee without further enquiry or evidence and, if relied upon by the Trustee, shall, in the absence of manifest or proven error, be conclusive and binding on all concerned;

Maturity Date means the date on which a Note is expressed to be redeemable;

month means calendar month;

Note means a note issued pursuant to the Programme and denominated in such currency or currencies as may be agreed between the Issuer, the Guarantor and the relevant Dealer(s) which has such maturity and denomination as may be agreed between the Issuer, the Guarantor, and the relevant Dealer(s) and issued or to be issued by the Issuer pursuant to the Programme Agreement or any other agreement between the Issuer, the Guarantor and the relevant Dealer(s) relating to the Programme, the Agency Agreement and these presents and

 

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which shall either (a) initially be represented by, and comprised in, a Temporary Global Note which may (in accordance with the terms of such Temporary Global Note) be exchanged for Definitive Notes or a Permanent Global Note which Permanent Global Note may (in accordance with the terms of such Permanent Global Note) in turn be exchanged for Definitive Notes or (b) be represented by, and comprised in, a Permanent Global Note which may (in accordance with the terms of such Permanent Global Note) be exchanged for Definitive Notes (all as indicated in the applicable Pricing Supplement) and includes any replacements for a Note issued pursuant to Condition 12;

Noteholders means the several persons who are for the time being holders of outstanding Notes save that, in respect of the Notes of any Series, for so long as such Notes or any part thereof are represented by a Global Note deposited with a common depositary for Euroclear and Clearstream, Luxembourg, each person who is for the time being shown in the records of Euroclear or Clearstream, Luxembourg (other than Clearstream, Luxembourg, if Clearstream, Luxembourg shall be an accountholder of Euroclear and Euroclear, if Euroclear shall be an accountholder of Clearstream, Luxembourg) as the holder of a particular nominal amount of the Notes of such Series shall be deemed to be the holder of such nominal amount of such Notes (and the holder of the relevant Global Note shall be deemed not to be the holder) for all purposes of these presents other than with respect to the payment of principal or interest on such nominal amount of such Notes the rights to which shall be vested, as against the Issuer, the Guarantor and the Trustee, solely in such common depositary and for which purpose such common depositary shall be deemed to be the holder of such nominal amount of such Notes in accordance with and subject to its terms and the provisions of these presents and the expressions Noteholder, holder and holder of Notes and related expressions shall be construed accordingly;

notice means, in respect of a notice to be given to Noteholders, a notice validly given pursuant to Condition 15;

Official List means the official list maintained by the UK Listing Authority;

outstanding means, in relation to the Notes of all or any Series, all the Notes of such Series issued other than:

 

  (a) those Notes which have been redeemed pursuant to these presents;

 

  (b) those Notes in respect of which the date (including, where applicable, any deferred date) for redemption in accordance with the Conditions has occurred and the redemption moneys (including all interest payable thereon) have been duly paid to the Trustee or to the Agent in the manner provided in the Agency Agreement (and where appropriate notice to that effect has been given to the relative Noteholders in accordance with Condition 15) and remain available for payment against presentation of the relevant Notes and/or Receipts and/or Coupons;

 

  (c) those Notes which have been purchased and cancelled in accordance with Conditions 8(h) and (i);

 

  (d) those Notes which have become void or in respect of which claims have become prescribed, in each case under Condition 10;

 

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  (e) those mutilated or defaced Notes which have been surrendered and cancelled and in respect of which replacements have been issued pursuant to Condition 12;

 

  (f) (for the purpose only of ascertaining the nominal amount of the Notes outstanding and without prejudice to the status for any other purpose of the relevant Notes) those Notes which are alleged to have been lost, stolen or destroyed and in respect of which replacements have been issued pursuant to Condition 12; and

 

  (g) any Global Note to the extent that it shall have been exchanged for Definitive Notes or another Global Note pursuant to its provisions, the provisions of these presents and the Agency Agreement,

PROVIDED THAT for each of the following purposes, namely:

 

(a) the right to attend and vote at any meeting of the holders of the Notes of any Series;

 

(b) the determination of how many and which Notes of any Series are for the time being outstanding for the purposes of Clause 9.1, Conditions 11 and 16 and paragraphs 2, 5, 6 and 9 of 0;

 

(c) any discretion, power or authority (whether contained in these presents or vested by operation of law) which the Trustee is required, expressly or impliedly, to exercise in or by reference to the interests of the holders of the Notes of any Series; and

 

(d) the determination by the Trustee whether any event, circumstance, matter or thing is, in its opinion, materially prejudicial to the interests of the holders of the Notes of any Series,

those Notes of the relevant Series (if any) which are for the time being held by or on behalf of the Issuer, the Guarantor, any Subsidiary of the Issuer or the Guarantor, any holding company of the Issuer or the Guarantor or any other Subsidiary of such holding company, in each case as beneficial owner, shall (unless and until ceasing to be so held) be deemed not to remain outstanding;

Paying Agents means, in relation to all or any Series of the Notes, the several institutions (including, where the context permits, the Agent) at their respective specified offices initially appointed as paying agents in relation to such Notes by the Issuer and the Guarantor pursuant to the Agency Agreement and/or, if applicable, any Successor paying agents at their respective specified offices in relation to all or any Series of the Notes;

Permanent Global Note means a global note in the form or substantially in the form set out in Part 2 of Schedule 2 with such modifications (if any) as may be agreed between the Issuer, the Guarantor, the Agent, the Trustee and the relevant Dealer(s), together with the copy of the applicable Pricing Supplement annexed thereto issued by the Issuer pursuant to the Programme Agreement or any other agreement between the Issuer, the Guarantor and the relevant Dealer(s) relating to the Programme, the Agency Agreement and these presents in exchange for the whole or part of any Temporary Global Note;

Potential Event of Default means any condition, event or act which, with the lapse of time and/or the issue, making or giving of any notice, certification, declaration, demand, determination and/or request and/or the taking of any similar action and/or the fulfilment of any similar condition, would constitute an Event of Default;

 

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Pricing Supplement has the meaning set out in the Programme Agreement;

Programme means the Euro Medium Term Note Programme established by, or otherwise contemplated in, the Programme Agreement;

Programme Agreement means the agreement of even date herewith between the Issuer and the Dealers named therein (or deemed named therein) concerning the purchase of Notes to be issued pursuant to the Programme together with any agreement for the time being in force amending, replacing, novating or modifying such agreement and any accession letters and/or agreements supplemental thereto;

Receipt means a receipt attached on issue to a Definitive Note redeemable in instalments for the payment of an instalment of principal, such receipt being in the form or substantially in the form set out in Part 4 of Schedule 2 or in such other form as may be agreed between the Issuer, the Guarantor, the Agent, the Trustee and the relevant Dealer(s) and includes any replacements for Receipts issued pursuant to Condition 12;

Receiptholders means the several persons who are for the time being holders of the Receipts;

Relevant Date has the meaning set out in Condition 9;

repay, redeem and pay shall each include both of the others and cognate expressions shall be construed accordingly;

Series means a Tranche of Notes together with any further Tranche or Tranches of Notes which are (a) expressed to be consolidated and form a single series and (b) identical in all respects (including as to listing) except for their respective Issue Dates, Interest Commencement Dates and/or Issue Prices and the expressions Notes of the relevant Series, holders of Notes of the relevant Series and related expressions shall be construed accordingly;

Stock Exchange means the London Stock Exchange or any other or further stock exchange(s) on which any Notes may from time to time be listed, and references in these presents to the “relevant Stock Exchange” shall, in relation to any Notes, be references to the Stock Exchange on which such Notes are, from time to time, or are intended to be, listed;

Subsidiary means any company which is for the time being a subsidiary (within the meaning of Section 736 of the Companies Act 1985 of Great Britain);

Successor means, in relation to the Agent, the other Paying Agents and the Calculation Agent, any successor to any one or more of them in relation to the Notes which shall become such pursuant to the provisions of these presents and/or the Agency Agreement (as the case may be) and/or such other or further principal paying agent, paying agents, in relation to the Notes as may (with the prior approval of, and on terms previously approved by, the Trustee in writing) from time to time be appointed as such, and/or, if applicable, such other or further specified offices (in the case of the Agent being within the same city as those for which it is they are substituted) as may from time to time be nominated, in each case by the Issuer and the Guarantor, and (except in the case of the initial appointments and specified offices made under and specified in the Conditions and/or the Agency Agreement, as the case may be) notice of whose appointment or, as the case may be, nomination has been given to the Noteholders;

 

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Talonholders means the several persons who are for the time being holders of the Talons;

Talons means the talons (if any) appertaining to, and exchangeable in accordance with the provisions therein contained for further Coupons appertaining to, the Definitive Notes (other than Zero Coupon Notes), such talons being in the form or substantially in the form set out in Part 6 of Schedule 2 or in such other form as may be agreed between the Issuer, the Guarantor, the Agent, the Trustee and the relevant Dealer(s) and includes any replacements for Talons issued pursuant to Condition 12;

Temporary Global Note means a temporary global note in the form or substantially in the form set out in Part 1 of Schedule 2 together with the copy of the applicable Pricing Supplement annexed thereto with such modifications (if any) as may be agreed between the Issuer, the Guarantor, the Agent, the Trustee and the relevant Dealer(s) issued by the Issuer pursuant to the Programme Agreement or any other agreement between the Issuer, the Guarantor and the relevant Dealer(s) relating to the Programme, the Agency Agreement and these presents;

these presents means this Trust Deed and the Schedules and any trust deed supplemental hereto and the Schedules (if any) thereto and the Notes, the Receipts, the Coupons, the Talons, the Conditions and, unless the context otherwise requires, the Pricing Supplements, all as from time to time modified in accordance with the provisions herein or therein contained;

Tranche means all Notes which are identical in all respects (including as to listing);

Trust Corporation means a corporation entitled by rules made under the Public Trustee Act 1906 of Great Britain or entitled pursuant to any other comparable legislation applicable to a trustee in any other jurisdiction to carry out the functions of a custodian trustee;

Trustee Acts means the Trustee Act 1925 and the Trustee Act 2000;

UK Listing Authority means the Financial Services Authority in its capacity as competent authority under the Financial Services and Markets Act 2000;

Zero Coupon Note means a Note on which no interest is payable;

words denoting the singular shall include the plural and vice versa;

words denoting one gender only shall include the other genders; and

words denoting persons only shall include firms and corporations and vice versa.

 

1.2    (a)   All references in these presents to principal and/or principal amount and/or interest in respect of the Notes or to any moneys payable by the Issuer or, as the case may be, the Guarantor under these presents shall, unless the context otherwise requires, be construed in accordance with Condition 8(e).
   (b)   All references in these presents to any statute or any provision of any statute shall be deemed also to refer to any statutory modification or re-enactment thereof or any statutory instrument, order or regulation made thereunder or under any such modification or re-enactment.

 

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  (c) All references in these presents to guarantees or to an obligation being guaranteed shall be deemed to include respectively references to indemnities or to an indemnity being given in respect thereof.

 

  (d) All references in these presents to any action, remedy or method of proceeding for the enforcement of the rights of creditors shall be deemed to include, in respect of any jurisdiction other than England, references to such action, remedy or method of proceeding for the enforcement of the rights of creditors available or appropriate in such jurisdiction as shall most nearly approximate to such action, remedy or method of proceeding described or referred to in these presents.

 

  (e) All references in these presents to Euroclear and/or Clearstream, Luxembourg shall, whenever the context so permits, be deemed to include references to any additional or alternative clearing system as is approved by the Issuer, the Guarantor, the Agent and the Trustee or as may otherwise be specified in the applicable Pricing Supplement.

 

  (f) Unless the context otherwise requires words or expressions used in these presents shall bear the same meanings as in the Companies Act 1985 of Great Britain.

 

  (g) In this Trust Deed references to Schedules, Clauses, sub-clauses, paragraphs and sub-paragraphs shall be construed as references to the Schedules to this Trust Deed and to the Clauses, sub-clauses, paragraphs and sub-paragraphs of this Trust Deed respectively.

 

  (h) In these presents tables of contents and Clause headings are included for ease of reference and shall not affect the construction of these presents.

 

  (i) All references in these presents involving compliance by the Trustee with a test of reasonableness shall be deemed to include a reference to a requirement that such reasonableness shall be determined by reference solely to the interests of the holders of the Notes of the relevant one or more Series as a class.

 

1.3 Words and expressions defined in these presents or the Agency Agreement or used in the applicable Pricing Supplement shall have the same meanings where used herein unless the context otherwise requires or unless otherwise stated provided that, in the event of inconsistency between the Agency Agreement and these presents, these presents shall prevail and, in the event of inconsistency between the Agency Agreement or these presents and the applicable Pricing Supplement, the applicable Pricing Supplement shall prevail.

 

1.4 Subject to the provisions of Condition 5, all references in these presents to the “relevant currency” shall be construed as references to the currency in which payments in respect of the Notes and/or Receipts and/or Coupons of the relevant Series are to be made as indicated in the applicable Pricing Supplement.

 

1.5 As used in these presents to Notes having a “listing” or being “listed” on a Stock Exchange shall, in relation to the London Stock Exchange, be construed to mean that such Notes have been admitted to the Official List by the UK Listing Authority and admitted to trading on the London Stock Exchange’s market for listed securities and all references in these presents to “listing” and “listed” shall include references to “quotation” and “quoted” respectively.

 

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2. AMOUNT AND ISSUE OF THE NOTES

 

2.1 Amount of the Notes, Pricing Supplements and Legal Opinions

The Notes will be issued in Series in an aggregate nominal amount from time to time outstanding not exceeding the Programme Limit from time to time and for the purpose of determining such aggregate nominal amount Clause 3(6) of the Programme Agreement shall apply.

By not later than 3.00 p.m. (London time) on the Third London Business Day preceding each proposed Issue Date, the Issuer shall deliver or cause to be delivered to the Trustee a copy of the applicable Pricing Supplement and drafts of all legal opinions to be given in relation to the relevant issue and shall notify the Trustee in writing without delay of the relevant Issue Date and the nominal amount of the Notes to be issued. Upon the issue of the relevant Notes, such Notes shall become constituted by these presents without further formality.

Before the first issue of Notes occurring after each anniversary of this Trust Deed and on such other occasions as the Trustee so requests (on the basis that the Trustee considers it necessary in view of a change (or proposed change) in English law affecting the Issuer or the Guarantor, these presents, the Programme Agreement, the Agency Agreement or the Trustee has other reasonable grounds), the Issuer or, as the case may be, the Guarantor will procure that further legal opinion(s) (relating, if applicable, to any such change or proposed change) in such form and with such content as the Trustee may require from the legal advisers specified in the Programme Agreement or such other legal advisers as the Trustee may require is/are delivered to the Trustee. Whenever such a request is made with respect to any Notes to be issued, the receipt of such opinion in a form satisfactory to the Trustee shall be a further condition precedent to the issue of those Notes.

 

2.2 Covenant to repay principal and to pay interest

The Issuer covenants with the Trustee that it will, as and when the Notes of any Series or any of them or any instalment of principal in respect thereof becomes due to be redeemed, or on such earlier as the same or any part thereof may become due and repayable thereunder, in accordance with the Conditions, unconditionally pay or procure to be paid to or to the order of the Trustee in the relevant currency in immediately available funds the principal amount in respect of the Notes of such Series or the amount of such instalment becoming due for redemption on that date and (except in the case of Zero Coupon Notes) shall in the meantime and until redemption in full of the Notes of such Series (both before and after any judgment or other order of a court of competent jurisdiction) unconditionally pay or procure to be paid to or to the order of the Trustee as aforesaid interest (which shall accrue from day to day) on the nominal amount of the Notes outstanding of such Series at rates and/or in amounts calculated from time to time in accordance with, or specified in, and on the dates provided for in, the Conditions (subject to Clause 2.4) PROVIDED THAT:

 

  (a) every payment of principal or interest or other sum due in respect of the Notes made to or to the order of the Agent in the manner provided in the Agency Agreement shall be in satisfaction pro tanto of the relative covenant by the Issuer in this Clause contained in relation to the Notes of such Series except to the extent that there is a default in the subsequent payment thereof in accordance with the Conditions to the relevant Noteholders, Receiptholders or Couponholders (as the case may be);

 

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  (b) in the case of any payment of principal which is not made to the Trustee or the Agent on or before the due date or on or after accelerated maturity following an Event of Default, interest shall continue to accrue on the nominal amount of the relevant Notes (except in the case of Zero Coupon Notes to which the provisions of Condition 8(j) shall apply) (both before and after any judgment or other order of a court of competent jurisdiction) at the rates aforesaid (or, if higher, the rate of interest on judgment debts for the time being provided by English law) up to and including the date which the Trustee determines to be the date on and after which payment is to be made in respect thereof as stated in a notice given to the holders of such Notes (such date to be not later than 30 days after the day on which the whole of such principal amount, together with an amount equal to the interest which has accrued and is to accrue pursuant to this proviso up to and including that date, has been received by the Trustee or the Agent); and

 

  (c) in any case where payment of the whole or any part of the principal amount of any Note is improperly withheld or refused upon due presentation thereof (other than in circumstances contemplated by (b) above) interest shall accrue on the nominal amount of such Note (except in the case of Zero Coupon Notes to which the provisions of Condition 8(j) shall apply) payment of which has been so withheld or refused (both before and after any judgment or other order of a court of competent jurisdiction) at the rates aforesaid (or, if higher, the rate of interest on judgment debts for the time being provided by English law) from the date of such withholding or refusal until the date on which, upon further presentation of the relevant Note, payment of the full amount (including interest as aforesaid) in the relevant currency payable in respect of such Note is made or (if earlier) the seventh day after notice is given to the relevant Noteholder(s) (whether individually or in accordance with Condition 15) that the full amount (including interest as aforesaid) in the relevant currency in respect of such Note is available for payment, PROVIDED THAT, upon further presentation thereof being duly made, such payment is made.

The Trustee will hold the benefit of this covenant on trust for the Noteholders, the Receiptholders and the Couponholders and itself in accordance with these presents.

 

2.3 Trustee’s requirements regarding Paying Agents etc

At any time after an Event of Default or a Potential Event of Default shall have occurred or the Notes of all or any Series shall otherwise have become due and repayable or the Trustee shall have received any money which it proposes to pay under Clause 10 to the relevant Noteholders, Receiptholders and/or Couponholders, the Trustee may:

 

  (a) by notice in writing to the Issuer, the Guarantor, the Agent and the other Paying Agents require the Agent and the other Paying Agents pursuant to the Agency Agreement:

 

  (i)

to act thereafter as Agent and other Paying Agents respectively of the Trustee in relation to payments to be made by or on behalf of the Trustee under the terms of these presents mutatis mutandis on the terms provided in the Agency Agreement (save that the Trustee’s liability under any provisions thereof for the indemnification, remuneration and payment of out-of-pocket expenses of the Agent and the other Paying Agents shall be limited to the amounts for the time being held by the Trustee on the trusts of these presents relating to the

 

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Notes of the relevant Series and available for such purpose) and thereafter to hold all Notes, Receipts and Coupons and all sums, documents and records held by them in respect of Notes, Receipts and Coupons on behalf of the Trustee; or

 

  (ii) to deliver up all Notes, Receipts and Coupons and all sums, documents and records held by them in respect of Notes, Receipts and Coupons to the Trustee or as the Trustee shall direct in such notice PROVIDED THAT such notice shall be deemed not to apply to any documents or records which the Agent or other Paying Agents are obliged not to release by any law or regulation; and

 

  (b) by notice in writing to the Issuer and the Guarantor require each of them to make all subsequent payments in respect of the Notes, Receipts and Coupons to or to the order of the Trustee and not to the Agent and with effect from the issue of any such notice to the Issuer and the Guarantor and until such notice is withdrawn proviso to sub-clause 2.2 of this Clause relating to the Notes shall cease to have effect.

 

2.4 If the Floating Rate Notes or Index Linked Interest Notes of any Series become immediately due and repayable under Condition 11 the rate and/or amount of interest payable in respect of them will be calculated by the Calculation Agent at the same intervals as if such Notes had not become due and repayable, the first of which will commence on the expiry of the Interest Period during which the Notes of the relevant Series become so due and repayable mutatis mutandis in accordance with the provisions of Condition 6 except that the rates of interest need not be published.

 

2.5 Currency of payments

All payments in respect of, under and in connection with these presents and the Notes of any Series to the relevant Noteholders, Receiptholders and Couponholders shall be made in the relevant currency.

 

2.6 Further Notes

The Issuer shall be at liberty from time to time (but subject always to the provisions of these presents) without the consent of the Noteholders, Receiptholders or Couponholders to create and issue further Notes (whether in bearer or registered form) having terms and conditions the same as the Notes of any Series (or the same in all respects save for the amount and date of the first payment of interest thereon) and so that the same shall be consolidated and form a single series with the outstanding Notes of a particular Series.

 

2.7 Separate Series

The Notes of each Series shall form a separate Series of Notes and accordingly, unless for any purpose the Trustee in its absolute discretion shall otherwise determine, the provisions of this Clause and of Clauses 3 to 21 (both inclusive) and 22.2 and Schedule 3 shall apply mutatis mutandis separately and independently to the Notes of each Series and in such Clauses and Schedule the expressions “Notes”, “Noteholders”, “Receipts”, “Receiptholders”, “Coupons”, “Couponholders”, “Talons” and “Talonholders” shall be construed accordingly.

 

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3. FORMS OF THE NOTES

 

3.1 Global Notes

 

(a) The Notes of each Tranche will initially be represented by a single Temporary Global Note or a single Permanent Global Note, as indicated in the applicable Pricing Supplement. Each Temporary Global Note shall be exchangeable, upon a request as described therein, for either Definitive Notes together with, where applicable, Receipts and (except in the case of Zero Coupon Notes) Coupons and, where applicable, Talons attached, or a Permanent Global Note in each case in accordance with the provisions of such Temporary Global Note. Each Permanent Global Note shall be exchangeable for Definitive Notes together with, where applicable, Receipts and (except in the case of Zero Coupon Notes) Coupons and, where applicable, Talons attached, in accordance with the provisions of such Permanent Global Note. All Global Notes shall be prepared, completed and delivered to a common depositary for Euroclear and Clearstream, Luxembourg in accordance with the provisions of the Programme Agreement or to another appropriate depositary in accordance with any other agreement between the Issuer, the Guarantor and the relevant Dealer(s) and, in each case, the Agency Agreement.

 

(b) Each Temporary Global Note shall be printed or typed in the form or substantially in the form set out in Part 1 of Schedule 2 and may be a facsimile. Each Temporary Global Note shall have annexed thereto a copy of the applicable Pricing Supplement and shall be signed manually or in facsimile by a person duly authorised by the Issuer on behalf of the Issuer and shall be authenticated by or on behalf of the Agent. Each Temporary Global Note so executed and authenticated shall be a binding and valid obligation of the Issuer and title thereto shall pass by delivery.

 

(c) Each Permanent Global Note shall be printed or typed in the form or substantially in the form set out in Part 2 of Schedule 2 and may be a facsimile. Each Permanent Global Note shall have annexed thereto a copy of the applicable Pricing Supplement and shall be signed manually or in facsimile by a person duly authorised by the Issuer on behalf of the Issuer and shall be authenticated by or on behalf of the Agent. Each Permanent Global Note so executed and authenticated shall be a binding and valid obligation of the Issuer and title thereto shall pass by delivery.

 

3.2 Definitive Notes

 

(a) The Definitive Notes, the Receipts, the Coupons and the Talons shall be to bearer in the respective forms or substantially in the respective forms set out in Parts 3, 4, 5 and 6, respectively, of Schedule 2. The Definitive Notes, the Receipts, the Coupons and the Talons shall be serially numbered and, if listed or quoted, shall be security printed in accordance with the requirements (if any) from time to time of the relevant Stock Exchange and the relevant Conditions may be incorporated by reference into such Definitive Notes unless not so permitted by the relevant Stock Exchange (if any), or the Definitive Notes shall be endorsed with or have attached thereto the relevant Conditions, and, in either such case, the Definitive Notes shall have endorsed thereon or attached thereto a copy of the applicable Pricing Supplement (or the relevant provisions thereof). Title to the Definitive Notes, the Receipts, the Coupons and the Talons shall pass by delivery.

 

(b)

The Definitive Notes shall be signed manually or in facsimile by a person duly authorised by the Issuer on behalf of the Issuer and shall be authenticated by or on behalf of the Agent (in

 

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the case of the Definitive Notes). The Definitive Notes so executed and authenticated, and the Receipts, the Coupons and the Talons, upon execution and authentication of the relevant Definitive Notes, shall be binding and valid obligations of the Issuer. The Receipts, the Coupons and the Talons shall not be signed. No Definitive Note and none of the Receipts, Coupons or Talons appertaining to such Definitive Note shall be binding or valid until such Definitive Note shall have been executed and authenticated as aforesaid.

 

3.3 Facsimile signatures

The Issuer may use the facsimile signature of any person who at the date such signature is affixed to a Note is duly authorised by the Issuer notwithstanding that at the time of issue of any of the Notes he may have ceased for any reason to be so authorised.

 

3.4 Persons to be treated as Noteholders

Except as ordered by a court of competent jurisdiction or as required by law, the Issuer, the Guarantor, the Trustee, the Agent and the other Paying Agents (notwithstanding any notice to the contrary and whether or not it is overdue and notwithstanding any notation of ownership or writing thereon or notice of any previous loss or theft thereof) may (a) (i) for the purpose of making payment thereon or on account thereof deem and treat the bearer of any Global Note, Definitive Note, Receipt, Coupon or Talon as the absolute owner thereof and of all rights thereunder free from all encumbrances, and shall not be required to obtain proof of such ownership or as to the identity of the bearer and (b) for all other purposes deem and treat:

 

  (i) the bearer of any Definitive Note, Receipt, Coupon or Talon; and

 

  (ii) each person for the time being shown in the records of Euroclear or Clearstream, Luxembourg as having a particular nominal amount of Notes credited to his securities account,

as the absolute owner thereof free from all encumbrances and shall not be required to obtain proof of such ownership (other than, in the case of any person for the time being so shown in such records, a certificate or letter of confirmation signed on behalf of Euroclear or Clearstream, Luxembourg or any other form of record made by any of them) or as to the identity of the bearer of any Global Note, Definitive Note, Receipt, Coupon or Talon.

 

3.5 Certificates of Euroclear and Clearstream, Luxembourg

The Issuer, the Guarantor and the Trustee may call for and, except in the case of manifest error, shall be at liberty to accept and place full reliance on as sufficient evidence thereof a certificate or letter of confirmation issued on behalf of Euroclear or Clearstream, Luxembourg or any form of record made by any of them or such other form of evidence and/or information and/or certification as it shall, in its absolute discretion, think fit to the effect that at any particular time or throughout any particular period any particular person is, was, or will be, shown in its records as the holder of a particular nominal amount of Notes represented by a Global Note and, if it does so rely, such letter of confirmation, form of record, evidence, information or certification shall be conclusive and binding on all concerned.

 

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4. FEES, DUTIES AND TAXES

The Issuer will pay any stamp, issue, registration, documentary and other fees, duties and similar taxes, including interest and penalties, payable on or in connection with (a) the execution and delivery of these presents, (b) the constitution and original issue of the Notes, the Receipts and the Coupons and (c) any action taken by or on behalf of the Trustee or (where permitted under these presents so to do) any Noteholder, Receiptholder or Couponholder to enforce, or to resolve any doubt concerning, or for any other purpose in relation to, these presents.

 

5. COVENANT OF COMPLIANCE

Each of the Issuer and the Guarantor severally covenants with the Trustee that it will comply with and perform and observe all the provisions of these presents which are expressed to be binding on it. The Conditions shall be binding on the Issuer, the Guarantor, the Noteholders, the Receiptholders and the Couponholders. The Trustee shall be entitled to enforce the obligations of the Issuer and the Guarantor under the Notes, the Receipts and the Coupons as if the same were set out and contained in this Trust Deed, which shall be read and construed as one document with the Notes, the Receipts and the Coupons. The Trustee shall hold the benefit of this covenant upon trust for itself and the Noteholders, the Receiptholders and the Couponholders according to its and their respective interests.

 

6. CANCELLATION OF NOTES AND RECORDS

 

6.1 The Issuer shall procure that all Notes issued by it (a) redeemed or (b) purchased by or on behalf of the Issuer, the Guarantor or any Subsidiary of the Issuer or the Guarantor or (c) which, being mutilated or defaced, have been surrendered and replaced pursuant to Condition 12 (together in each case, in the case of Definitive Notes, with all unmatured Receipts and Coupons attached thereto or delivered therewith), and all Receipts and Coupons paid in accordance with the relevant Conditions or which, being mutilated or defaced, have been surrendered and replaced pursuant to Condition 12, shall forthwith be cancelled by or on behalf of the Issuer and a certificate stating:

 

(i) the aggregate principal amount of Notes which have been redeemed and the aggregate amounts in respect of Receipts and Coupons which have been paid;

 

(ii) the serial numbers of such Notes in definitive form and Receipts;

 

(iii) the total numbers (where applicable, of each denomination) by maturity date of such Receipts and Coupons;

 

(iv) the aggregate amount of interest paid (and the due dates of such payments) on Global Notes;

 

(v) the aggregate nominal amount of Notes (if any) which have been purchased by or on behalf of the Issuer, the Guarantor or any Subsidiary of the Issuer or the Guarantor and cancelled and the serial numbers of such Notes in definitive form and, in the case of Definitive Notes, the total number (where applicable, of each denomination) by maturity date of the Receipts, Coupons and Talons attached thereto or surrendered therewith;

 

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  (vi) the aggregate nominal amounts of Notes and Receipts and the aggregate amounts in respect of Coupons which have been so surrendered and replaced and the serial numbers of such Notes in definitive form and the total number (where applicable, of each denomination) by maturity date of such Coupons and Talons;

 

  (vii) the total number (where applicable, of each denomination) by maturity date of the unmatured Coupons missing from Definitive Notes bearing interest at a fixed rate which have been redeemed or surrendered and replaced and the serial numbers of the Definitive Notes to which such missing unmatured Coupons appertained; and

 

  (viii) the total number (where applicable, of each denomination) by maturity date of Talons which have been exchanged for further Coupons

shall be given to the Trustee by or on behalf of the Issuer as soon as possible and in any event within four months after the date of such redemption, purchase, payment, exchange or replacement (as the case may be). The Trustee may accept such certificate as conclusive evidence of redemption, purchase or replacement pro tanto of the Notes or payment of interest thereon or exchange of the relative Talons respectively and of cancellation of the relative Notes and Coupons.

 

6.2 The Issuer shall procure (a) that the Agent shall keep a full and complete record of all Notes, Receipts, Coupons and Talons issued by it (other than serial numbers of Receipts and Coupons) and of their redemption or purchase by or on behalf of the Issuer, the Guarantor or any Subsidiary of the Issuer or the Guarantor, any cancellation or any payment (as the case may be) and of all replacement notes, receipts, coupons or talons issued in substitution for lost, stolen, mutilated, defaced or destroyed Notes, Receipts, Coupons or Talons, (b) that the Agent shall in respect of the Coupons of each maturity retain (in the case of Coupons other than Talons) until the expiry of 10 years from the Relevant Date in respect of such Coupons and (in the case of Talons indefinitely) either all paid or exchanged Coupons of that maturity or a list of the serial numbers of Coupons of that maturity still remaining unpaid or unexchanged and (c) that such records and Coupons (if any) shall be made available to the Trustee at all reasonable times.

 

7. GUARANTEE

 

7.1 Guarantee

The Guarantor irrevocably and unconditionally:

 

  (a) As principal obligor guarantees to the Trustee prompt performance by the Issuer of all its obligations under the Notes and these presents in respect thereof;

 

  (b) undertakes with the Trustee that whenever the Issuer does not pay any amount when due under or in connection with the Notes and these presents in respect thereof, the Guarantor shall immediately pay that amount as if the Guarantor instead of the Issuer were expressed to be the principal obligor and not merely a surety; and

 

  (c) indemnifies the Trustee against any loss or liability suffered by it if any obligation guaranteed by the Guarantor is or becomes unenforceable, invalid or illegal.

 

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7.2 Continuing guarantee

This guarantee is a continuing guarantee and will extend to the ultimate balance of all sums payable by the Issuer under the Notes and these presents in respect thereof, regardless of any intermediate payment or discharge in whole or in part.

 

7.3 Reinstatement

 

(a) Where any discharge is made in whole or in part or any arrangement is made on the faith of any payment, security or other disposition which is avoided or must be restored on insolvency, liquidation or otherwise without limitation, the liability of the Guarantor under this Clause 7 shall continue as if the discharge or arrangement had not occurred.

 

(b) The Trustee may concede or compromise any claim that any payment, security or other disposition is liable to avoidance or restoration.

 

7.4 Waiver of defences

The obligations of the Guarantor under this Clause 7 will not be affected by any act, omission, matter or thing which, but for this provision, would reduce, release or prejudice any of its obligations under this Clause 7 or prejudice or diminish those obligations in whole or in part, including (whether or not known to it or the Trustee):

 

  (a) any time or waiver granted to, or composition with, the Issuer or any other person;

 

  (b) the release of the Issuer or any other person under the terms of any composition or arrangement with any creditor of the Issuer or any of its subsidiaries;

 

  (c) the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect, take up or enforce, any rights against, or security over assets of, the Issuer or any other person or any non-presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security;

 

  (d) any incapacity or lack of powers, authority or legal personality of or dissolution or change in the members or status of the Issuer or any other person;

 

  (e) any variation (however fundamental) or replacement of the Notes or any other document or security so that references to the Notes in this Clause 7 shall include each variation or replacement;

 

  (f) any unenforceability, illegality or invalidity of any obligation of any person under the Notes or any other document or security, to the intent that the Guarantor’s obligations under this Clause 7 shall remain in full force and its guarantee be construed accordingly, as if there were no unenforceability, illegality or invalidity; or

 

  (g) any postponement, discharge, reduction, non-provability or other similar circumstance affecting any obligation of the Issuer under the Notes resulting from any insolvency, liquidation or dissolution proceedings or from any law, regulation or order so that each such obligation shall for the purposes of the Guarantor’s obligations under this Clause 7 be construed as if there were no such circumstance.

 

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7.5 Immediate recourse

The Guarantor waives any right it may have of first requiring the Trustee (or any agent on its behalf) to proceed against or enforce any other rights or security or claim payment from any person before claiming from the Guarantor under this Clause 7.

 

7.6 Appropriations

 

  (a) Until all amounts which may be or become payable by the Issuer under or in connection with the Notes and these presents in respect thereof have been irrevocably paid in full, the Trustee (or any agent on its behalf) may:

 

  (i) refrain from applying or enforcing any other moneys, security or rights held or received by the Trustee (or any agent on its behalf) in respect of those amounts, or apply and enforce the same in such manner and order as it sees fit (whether against those amounts or otherwise) and the Guarantor shall not be entitled to the benefit of the same; and

 

  (ii) hold in a suspense account (bearing interest at normal commercial rates) any moneys received from the Guarantor or on account of the Guarantor’s liability under this Clause 7.

 

  (b) Paragraph 7.6(a)(i) or 7.6(a)(ii), or both, as applicable, shall only apply to the extent that the application of such paragraph or paragraphs, as applicable, does not result in the amount that is guaranteed pursuant to Clause 7.1 being greater than it would otherwise have been but for the application of such paragraph or paragraphs.

 

7.7 Non-competition

Until all amounts which may be or become payable by the Issuer under or in connection with the Notes and these presents in respect thereof have been irrevocably paid in full, the Guarantor shall not, after a claim has been made or by virtue of any payment or performance by it under this Clause 7:

 

  (a) be subrogated to any rights, security or moneys held, received or receivable by the Trustee (or any agent on its behalf) or be entitled to any right of contribution or indemnity in respect of any payment made or moneys received on account of the Guarantor’s liability under this Clause 7;

 

  (b) claim, rank, prove or vote as a creditor of the Issuer or its estate in competition with the Trustee (or any agent on its behalf); or

 

  (c) receive, claim or have the benefit of any payment, distribution or security from or on account of the Issuer, or exercise any right of set-off as against the Issuer,

unless the Trustee otherwise directs.

 

7.8 Additional security

This guarantee is in addition to and is not in any way prejudiced by any other security now or hereafter held by the Trustee.

 

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8. NON-PAYMENT

Proof that as regards any specified Note, Receipt or Coupon the Issuer or, as the case may be, the Guarantor has made default in paying any amount due in respect of such Note, Receipt or Coupon shall (unless the contrary be proved) be sufficient evidence that the same default has been made as regards all other Notes, Receipts or Coupons (as the case may be) in respect of which the relevant amount is due and payable.

 

9. PROCEEDINGS, ACTION AND INDEMNIFICATION

 

9.1 The Trustee shall not be bound to take any action or proceedings mentioned in Condition 11 or any other action in relation to these presents unless respectively directed or requested to do so (a) by an Extraordinary Resolution or (b) in writing by the holders of at least one-fifth in aggregate nominal amount of the Notes then outstanding and in either case then only if it shall be indemnified to its satisfaction against all Liabilities to which it may thereby render itself liable or which it may incur by so doing.

 

9.2 Only the Trustee may enforce the provisions of these presents. No Noteholder, Receiptholder or Couponholder shall be entitled to proceed directly against the Issuer or the Guarantor to enforce the performance of any of the provisions of these presents unless the Trustee having become bound as aforesaid to take proceedings fails to do so within a reasonable period and such failure is continuing.

 

10. APPLICATION OF MONEYS

All moneys received by the Trustee under these presents from the Issuer or, as the case may be, the Guarantor (including any moneys which represent principal or interest in respect of Notes, Receipts or Coupons which have become void or in respect of which claims have become prescribed under Condition 10) shall, unless and to the extent attributable, in the opinion of the Trustee, to a particular Series of the Notes, be apportioned pari passu and rateably between each Series of the Notes, and all moneys received by the Trustee under these presents from the Issuer or, as the case may be, the Guarantor to the extent attributable in the opinion of the Trustee to a particular Series of the Notes or which are apportioned to such Series as aforesaid, be held by the Trustee upon trust to apply them (subject to Clause 12):

First in payment or satisfaction of all amounts then due and unpaid under Clauses 15 and/or 16(j) to the Trustee and/or any Appointee;

Secondly in or towards payment pari passu and rateably of all principal and interest then due and unpaid in respect of the Notes of that Series;

Thirdly in or towards payment pari passu and rateably of all principal and interest then due and unpaid in respect of the Notes of each other Series; and

Fourthly in payment of the balance (if any) to the Issuer or the Guarantor, as the case may be, (without prejudice to, or liability in respect of, any question as to how such payment to the Issuer or the Guarantor, as the case may be, shall be dealt with as between the Issuer or the Guarantor, as the case may be, and any other person).

Without prejudice to this Clause 10, if the Trustee holds any moneys which represent principal or interest in respect of Notes which have become void or in respect of which claims

 

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have been prescribed under Condition 10, the Trustee will hold such moneys on the above trusts.

 

11. NOTICE OF PAYMENTS

The Trustee shall give notice to the relevant Noteholders in accordance with Condition 15 of the day fixed for any payment to them under Clause 10. Such payment may be made in accordance with Condition 7 and any payment so made shall be a good discharge to the Trustee.

 

12. INVESTMENT BY TRUSTEE

 

12.1 The Trustee may at its discretion and pending payment invest moneys at any time available for the payment of principal and interest on the Notes in some or one of the investments hereinafter authorised for such periods as it may consider expedient with power from time to time at the like discretion to vary such investments. All interest and other income deriving from such investments shall be applied first in payment or satisfaction of all amounts then due and unpaid under Clause 15 and/or 16(j) to the Trustee and/or any Appointee and otherwise held for the benefit of and paid to the Noteholders, Receiptholders or Couponholders, as the case may be.

 

12.2 Any moneys which under the trusts of these presents ought to or may be invested by the Trustee may be invested in the name or under the control of the Trustee in any investments or other assets in any part of the world whether or not they produce income or by placing the same on deposit in the name or under the control of the Trustee at such bank or other financial institution and in such currency as the Trustee may think fit. If that bank or institution is the Trustee or a Subsidiary, holding or associated company of the Trustee, it need only account for an amount of interest equal to the amount of interest which would, at then current rates, be payable by it on such a deposit to an independent customer. The Trustee may at any time vary any such investments for or into other investments or convert any moneys so deposited into any other currency and shall not be responsible for any loss resulting from any such investments or deposits, whether due to depreciation in value, fluctuations in exchange rates or otherwise.

 

13. PARTIAL PAYMENTS

Upon any payment under Clause 11 (other than payment in full against surrender of a Note, Receipt or Coupon) the Note, Receipt or Coupon in respect of which such payment is made shall be produced to the Trustee or the Paying Agent by or through whom such payment is made and the Trustee shall or shall cause the Paying Agent to enface thereon a memorandum of the amount and the date of payment but the Trustee may in any particular case dispense with such production and enfacement upon such indemnity being given as it shall think sufficient.

 

14. COVENANTS BY THE ISSUER AND THE GUARANTOR

Each of the Issuer and the Guarantor severally covenants with the Trustee that, so long as any of the Notes remains outstanding (or, in the case of paragraphs (h), (i), (m), (n), (p) and (r) so long as any of such Notes or the relative Receipts or Coupons remains liable to prescription or, in the case of paragraph (o), until the expiry of a period of 30 days after the Relevant Date in respect of the payment of principal in respect of all such Notes remaining outstanding at such time) it shall:

 

  (a) at all times carry on and conduct its affairs and procure its Subsidiaries to carry on and conduct their respective affairs in a proper and efficient manner;

 

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  (b) give or procure to be given to the Trustee such opinions, certificates and information as it shall require and in such form as it shall require (including without limitation the procurement of all such certificates called for by the Trustee pursuant to Clause 16(c)) for the purpose of the discharge or exercise of the duties, trusts, powers, authorities and discretions vested in it under these presents or by operation of law;

 

  (c) cause to be prepared and certified by its Auditors in respect of each financial accounting period accounts in such form as will comply with all relevant legal and accounting requirements and all requirements for the time being of the relevant Stock Exchange;

 

  (d) at all times keep and procure its Subsidiaries to keep proper books of account and allow the Trustee and any person appointed by the Trustee to whom the Issuer or (as the case may be) the Guarantor shall have no reasonable objection free access to such books of account at all reasonable times during normal business hours;

 

  (e) send to the Trustee (in addition to any copies to which it may be entitled as a holder of any securities of the Issuer or the Guarantor) two copies in English of every balance sheet, profit and loss account, report, circular and notice of general meeting and every other document issued or sent to its shareholders together with any of the foregoing, and every document issued or sent to holders of securities other than its shareholders (including the Noteholders) as soon as practicable after the issue or publication thereof;

 

  (f) forthwith give notice in writing to the Trustee of the coming into existence of any security interest which would require any security to be given to the Notes pursuant to Condition 4 or of the occurrence of any Event of Default or any Potential Event of Default;

 

  (g) give to the Trustee (i) within seven days after demand by the Trustee therefor and (ii) (without the necessity for any such demand) promptly after the publication of its audited accounts in respect of each financial year commencing with the financial year ending 30th April, 2002 and in any event not later than 180 days after the end of each such financial year a certificate signed by two of its Directors to the effect that as at a date not more than seven days before delivering such certificate (the relevant certification date) there did not exist and had not existed since the relevant certification date of the previous certificate (or, in the case of the first such certificate, the date hereof) any Event of Default or any Potential Event of Default (or if such exists or existed specifying the same);

 

  (h) at all times execute and do all such further documents, acts and things as may be necessary at any time or times in the opinion of the Trustee for the purpose of discharging its functions under, or giving effect to, these presents;

 

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  (i) at all times maintain an Agent and other Paying Agents in accordance with the Conditions;

 

  (j) use all reasonable endeavours to procure the Agent to notify the Trustee forthwith in the event that it does not, on or before the due date for any payment in respect of the Notes or any of the relative Receipts or Coupons, receive unconditionally pursuant to the Agency Agreement payment of the full amount in the requisite currency of the moneys payable on such due date on all such Notes, Receipts or Coupons, as the case may be;

 

  (k) in the event of the unconditional payment to the Agent or the Trustee of any sum due in respect of the Notes or any of them or any of the relative Receipts or Coupons being made after the due date for payment thereof forthwith give or procure to be given notice to the relevant Noteholders in accordance with Condition 15 that such payment has been made;

 

  (l) use all reasonable endeavours to maintain the quotation or listing on the relevant Stock Exchange of those of the Notes which are quoted or listed on the relevant Stock Exchange or, if it is unable to do so having used such endeavours, use all reasonable endeavours to obtain and maintain a quotation or listing of such Notes on such other stock exchange or exchanges or securities market or markets as the Issuer and the Guarantor may (with the prior written approval of the Trustee) decide and also upon obtaining a quotation or listing of such Notes issued by it on such other stock exchange or exchanges or securities market or markets enter into a trust deed supplemental to this Trust Deed to effect such consequential amendments to these presents as the Trustee may require or as shall be requisite to comply with the requirements of any such stock exchange or securities market;

 

  (m) give notice to the Noteholders in accordance with Condition 15 of any appointment, resignation or removal of any Agent, Calculation Agent or other Paying Agent (other than the appointment of the initial Agent, Calculation Agent and other Paying Agents) after having obtained the prior written approval of the Trustee thereto or any change of any Paying Agent’s specified office and (except as provided by the Agency Agreement or the Conditions) at least 30 days prior to such event taking effect; PROVIDED ALWAYS THAT so long as any of the Notes remains outstanding in the case of the termination of the appointment of the Calculation Agent or so long as any of the Notes, Receipts or Coupons remains liable to prescription in the case of the termination of the appointment of the Agent no such termination shall take effect until a new Agent or Calculation Agent (as the case may be) has been appointed on terms previously approved in writing by the Trustee;

 

  (n) obtain the prior written approval of the Trustee to, and promptly give to the Trustee two copies of, the form of every notice given to the Noteholders in accordance with Condition 15 (such approval, unless so expressed, not to constitute approval of any such notice for the purposes of Section 21 of the Financial Services and Markets Act 2000 (the FSMA) of a communication within the meaning of Section 21 of the FSMA);

 

  (o)

if the Issuer or Guarantor shall become subject generally to the taxing jurisdiction of any territory or any political sub-division or any authority therein or thereof having power to tax other than or in addition to the United Kingdom or any political sub-

 

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division or any authority therein or thereof having power to tax, immediately upon becoming aware thereof notify the Trustee of such event and (unless the Trustee otherwise agrees) enter forthwith into a trust deed supplemental to this Trust Deed, giving to the Trustee an undertaking or covenant in form and manner satisfactory to the Trustee in terms corresponding to the terms of Condition 9 with the substitution for (or, as the case may be, the addition to) the references therein to the United Kingdom or any political sub-division thereof or any authority therein or thereof having power to tax of references to that other or additional territory or any political sub-division thereof or any authority therein or thereof having power to tax to whose taxing jurisdiction the Issuer or, as the case may be, the Guarantor shall have become subject as aforesaid and Condition 8(b) shall be read and construed accordingly;

 

  (p) comply with and perform all its obligations under the Agency Agreement and procure that the Agent and the other Paying Agents comply with and perform all their respective obligations thereunder and any notice given by the Trustee pursuant to Clause 2.3(a) and not make any amendment or modification to such Agreement without the prior written approval of the Trustee;

 

  (q) in order to enable the Trustee to ascertain the nominal amount of the Notes of each Series for the time being outstanding for any of the purposes referred to in the proviso to the definition of “outstanding” in Clause 1, deliver to the Trustee as soon as practicable upon being so requested in writing by the Trustee a certificate in writing signed by two Directors of the Issuer or by two Directors of the Guarantor (as appropriate), setting out the total number and aggregate nominal amount of the Notes of each Series issued which:

 

  (i) up to and including the date of such certificate have been purchased by the Issuer or the Guarantor, any Subsidiary of the Issuer or the Guarantor, any holding company of the Issuer or the Guarantor or any other Subsidiary of such holding company and cancelled; and

 

  (ii) are at the date of such certificate held by, for the benefit of, or on behalf of, the Issuer or the Guarantor, any Subsidiary of the Issuer or the Guarantor, any holding company of the Issuer or the Guarantor or any other Subsidiary of such holding company;

 

  (r) use all reasonable endeavours to procure its Subsidiaries (save for the Issuer, in the case of the Guarantor) to comply with all applicable provisions of Condition 8;

 

  (s) use all reasonable endeavours to procure that each of the Paying Agents makes available for inspection by Noteholders, Receiptholders and Couponholders at its specified office copies of these presents, the Agency Agreement and the then latest audited balance sheet and profit and loss account (consolidated if applicable) of the Issuer;

 

  (t) if, in accordance with the provisions of the Conditions, interest in respect of the Notes becomes payable at the specified office of any Paying Agent in the United States of America promptly give notice thereof to the relative Noteholders in accordance with Condition 15;

 

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  (u) in the case of the Issuer only, give prior notice to the Trustee of any proposed redemption pursuant to Condition 8(b) or 8(c) and, if it shall have given notice to the Noteholders of its intention to redeem any Notes pursuant to Condition 8(c), duly proceed to make drawings (if appropriate) and to redeem Notes accordingly;

 

  (v) promptly provide the Trustee with copies of all supplements and/or amendments and/or restatements of the Programme Agreement;

 

  (w) upon due surrender in accordance with the Conditions, pay the face value of all Coupons (including Coupons issued in exchange for Talons) appertaining to all Notes purchased by the Issuer or the Guarantor or any Subsidiary of the Issuer or the Guarantor; and

 

  (x) use all reasonable endeavours to procure that Euroclear and/or Clearstream, Luxembourg issue(s) any certificate or other document requested by the Trustee under Clause 3.5 as soon as practicable after such request.

 

15. REMUNERATION AND INDEMNIFICATION OF TRUSTEE

 

15.1 The Issuer shall pay to the Trustee, by way of remuneration for its services as trustee of these presents, such amount as shall be agreed from time to time by exchange of letters between the Issuer and the Trustee. Such remuneration shall accrue from day to day and be payable (in priority to payments to Noteholders, Receiptholders and Couponholders) up to and including the date when, all the Notes having become due for redemption, the redemption moneys and interest thereon to the date of redemption have been paid to the Agent or the Trustee PROVIDED THAT if upon due presentation of any Note, Receipt or Coupon or any cheque payment of the moneys due in respect thereof is improperly withheld or refused, remuneration will be deemed not to have ceased to accrue and will continue to accrue until payment to such Noteholder, Receiptholder or Couponholder is duly made.

 

15.2 In the event of the occurrence of an Event of Default or a Potential Event of Default or the Trustee considering it expedient or necessary or being requested by the Issuer or the Guarantor to undertake duties which the Trustee and the Issuer or, as the case may be, the Guarantor agree to be of an exceptional nature or otherwise outside the scope of the normal duties of the Trustee under these presents the Issuer shall pay to the Trustee such additional remuneration as shall be agreed between them.

 

15.3 The Issuer shall in addition pay to the Trustee an amount equal to the amount of any value added tax or similar tax chargeable in respect of its remuneration under these presents.

 

15.4 In the event of the Trustee and the Issuer failing to agree:

 

  (a) (in a case to which sub-clause 15.1 above applies) upon the amount of the remuneration; or

 

  (b) (in a case to which sub-clause 15.2 above applies) upon whether such duties shall be of an exceptional nature or otherwise outside the scope of the normal duties of the Trustee under these presents, or upon such additional remuneration,

such matters shall be determined by a merchant or investment bank (acting as an expert and not as an arbitrator) selected by the Trustee and approved by the Issuer or, failing such

 

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approval, nominated (on the application of the Trustee) by the President for the time being of The Law Society of England and Wales (the expenses involved in such nomination and the fees of such merchant or investment bank being payable by the Issuer) and the determination of any such merchant or investment bank shall be final and binding upon the Trustee and the Issuer.

 

15.5 The Issuer shall on written request also pay or discharge all Liabilities properly incurred by the Trustee (excluding any liability to Tax imposed on all or part of its income, profits or gains) in relation to the preparation and execution of the exercise of its powers and the performance of its duties under, and in any other manner in relation to, these presents, including but not limited to reasonable travelling expenses and any stamp, issue, registration, documentary and other taxes or duties paid or payable by the Trustee in connection with any action taken by or on behalf of the Trustee for enforcing, or resolving any doubt concerning, or for any other purpose in relation to, these presents.

 

15.6 All amounts payable pursuant to sub-clause 15.5 above and/or Clause 16(j) shall be payable by the Issuer on the date specified in a demand by the Trustee and in the case of payments actually made by the Trustee prior to such demand shall (if not paid within three days after such demand and the Trustee so requires) carry interest at the rate of three per cent. per annum above the Base Rate from time to time of Lloyds Bank plc from the date specified in such demand, and in all other cases shall (if not paid on the date specified in such demand or, if later, within three days after such demand and, in either case, the Trustee so requires) carry interest at such rate from the date specified in such demand. All remuneration payable to the Trustee shall carry interest at such rate from the due date therefor.

 

15.7 Unless otherwise specifically stated in any discharge of these presents the provisions of this Clause and Clause 16(j) shall continue in full force and effect in relation to the period during which the Trustee was trustee of these presents notwithstanding such discharge.

 

15.8 The Trustee shall be entitled in its absolute discretion to determine in respect of which Series of Notes any Liabilities incurred under these presents have been incurred or to allocate any such Liabilities between the Notes of any Series.

 

16. SUPPLEMENT TO TRUSTEE ACTS

Section 1 of the Trustee Act 2000 shall not apply to the duties of the Trustee in relation to the trusts constituted by these presents. Where there are any inconsistencies between the Trustee Acts and the provisions of these presents, the provisions of these presents shall, to the extent allowed by law, prevail and, in the case of any such inconsistency with the Trustee Act 2000, the provisions of these presents shall constitute a restriction or exclusion for the purposes of that Act. The Trustee shall have all the powers conferred upon trustees by the Trustee Acts and by way of supplement thereto it is expressly declared as follows:

 

  (a) The Trustee may in relation to these presents act on the advice or opinion of or any information obtained from any lawyer, valuer, accountant, surveyor, banker, broker, auctioneer or other expert whether obtained by the Issuer, the Guarantor, the Trustee or otherwise and shall not be responsible for any Liability occasioned by so acting.

 

  (b)

Any such advice, opinion or information may be sent or obtained by letter, telex, telegram, facsimile transmission or cable and the Trustee shall not be liable for acting on any advice, opinion or information purporting to be conveyed by any such letter,

 

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telex, telegram, facsimile transmission or cable although the same shall contain some error or shall not be authentic.

 

  (c) The Trustee may call for and shall be at liberty to accept as sufficient evidence of any fact or matter or the expediency of any transaction or thing a certificate signed by two of the Directors of the Issuer or two of the Directors of the Guarantor and the Trustee shall not be bound in any such case to call for further evidence or be responsible for any Liability that may be occasioned by it or any other person acting on such certificate.

 

  (d) The Trustee shall be at liberty to hold these presents and any other documents relating thereto or to deposit them in any part of the world with any banker or banking company or company whose business includes undertaking the safe custody of documents or lawyer or firm of lawyers considered by the Trustee to be of good repute and the Trustee shall not be responsible for or required to insure against any Liability incurred in connection with any such holding or deposit and may pay all sums required to be paid on account of or in respect of any such deposit.

 

  (e) The Trustee shall not be responsible for the receipt or application of the proceeds of the issue of any of the Notes by the Issuer, the exchange of any Global Note for another Global Note or Definitive Notes or the delivery of any Global Note or Definitive Notes to the person(s) entitled to it or them.

 

  (f) The Trustee shall not be bound to give notice to any person of the execution of any documents comprised or referred to in these presents or to take any steps to ascertain whether any Event of Default or any Potential Event of Default has occurred and, until it shall have actual knowledge or express notice pursuant to these presents to the contrary, the Trustee shall be entitled to assume that no Event of Default or Potential Event of Default has occurred and that each of the Issuer and the Guarantor is observing and performing all its obligations under these presents.

 

  (g) Save as expressly otherwise provided in these presents, the Trustee shall have absolute and uncontrolled discretion as to the exercise or non-exercise of its trusts, powers, authorities and discretions under these presents (the exercise or non-exercise of which as between the Trustee and the Noteholders, the Receiptholders and Couponholders shall be conclusive and binding on the Noteholders, the Receiptholders and Couponholders) and shall not be responsible for any Liability which may result from their exercise or non-exercise.

 

  (h) The Trustee shall not be liable to any person by reason of having acted upon any Extraordinary Resolution in writing or any Extraordinary Resolution or other resolution purporting to have been passed at any meeting of the holders of Notes of all or any Series in respect whereof minutes have been made and signed or any direction or request of the holders of the Notes of all or any Series even though subsequent to its acting it may be found that there was some defect in the constitution of the meeting or the passing of the resolution, (in the case of an Extraordinary Resolution in writing) that not all such holders had signed the Extraordinary Resolution or (in the case of a direction or request) it was not signed by the requisite number of holders) or that for any reason the resolution, direction or request was not valid or binding upon such holders and the relative Receiptholders and Couponholders.

 

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  (i) The Trustee shall not be liable to any person by reason of having accepted as valid or not having rejected any Note, Receipt or Coupon purporting to be such and subsequently found to be forged or not authentic.

 

  (j) Without prejudice to the right of indemnity by law given to trustees, the Issuer and the Guarantor shall severally indemnify the Trustee and every Appointee and keep it or him indemnified against all Liabilities to which it or he may be or become subject or which may be incurred by it or him in the execution or purported execution of any of its or his trusts, powers, authorities and discretions under these presents or its or his functions under any such appointment or in respect of any other matter or thing done or omitted in any way relating to these presents or any such appointment.

 

  (k) Any consent or approval given by the Trustee for the purposes of these presents may be given on such terms and subject to such conditions (if any) as the Trustee thinks fit and notwithstanding anything to the contrary in these presents may be given retrospectively.

 

  (l) The Trustee shall not (unless and to the extent ordered so to do by a court of competent jurisdiction) be required to disclose to any Noteholder, Receiptholder or Couponholder any information (including, without limitation, information of a confidential, financial or price sensitive nature) made available to the Trustee by the Issuer or the Guarantor or any other person in connection with these presents and no Holder, Receiptholder or Couponholder shall be entitled to take any action to obtain from the Trustee any such information.

 

  (m) Where it is necessary or desirable for any purpose in connection with these presents to convert any sum from one currency to another it shall (unless otherwise provided by these presents or required by law) be converted at such rate or rates, in accordance with such method and as at such date for the determination of such rate of exchange, as may be agreed by the Trustee in consultation with the Issuer or the Guarantor as relevant and any rate, method and date so agreed shall be binding on the Issuer, the Guarantor, the Noteholders, the Receiptholders and the Couponholders.

 

  (n) The Trustee may certify whether or not any of the conditions, events and acts set out in paragraphs (ii) and (iii) and (v) to (vii) (both inclusive) of Condition 11 (each of which conditions, events and acts shall, unless in any case the Trustee in its absolute discretion shall otherwise determine, for all the purposes of these presents be deemed to include the circumstances resulting therein and the consequences resulting therefrom) is in its opinion materially prejudicial to the interests of the Noteholders and any such certificate shall be conclusive and binding upon the Issuer, the Guarantor, the Noteholders and the Couponholders.

 

  (o) The Trustee as between itself and the Noteholders, the Receiptholders and the Couponholders may determine all questions and doubts arising in relation to any of the provisions of these presents. Every such determination, whether or not relating in whole or in part to the acts or proceedings of the Trustee, shall be conclusive and shall bind the Trustee and the Noteholders, the Receiptholders and the Couponholders.

 

  (p)

In connection with the exercise by it of any of its trusts, powers, authorities or discretions under these presents (including, without limitation, any modification,

 

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waiver, authorisation or determination), the Trustee shall have regard to the general interests of the Noteholders as a class but shall not have regard to any interests arising from circumstances particular to individual Noteholders, Receiptholders or Couponholders (whatever their number) and, in particular but without limitation, shall not have regard to the consequences of such exercise for individual Noteholders, Receiptholders or Couponholders (whatever their number) resulting from their being for any purpose domiciled or resident in, or otherwise connected with, or subject to the jurisdiction of, any particular territory or any political sub-division thereof and the Trustee shall not be entitled to require, nor shall any Noteholder, Receiptholder or Couponholder be entitled to claim, from the Issuer, the Guarantor, the Trustee or any other person any indemnification or payment in respect of any tax consequence of any such exercise upon individual Noteholders, Receiptholders or Couponholders except to the extent already provided for in Condition 9 and/or any undertaking given in addition thereto or in substitution therefor under these presents.

 

  (q) Any trustee of these presents being a lawyer, accountant, broker or other person engaged in any profession or business shall be entitled to charge and be paid all usual and proper professional and other charges for business transacted and acts done by him or his firm in connection with the trusts of these presents and also his reasonable charges in addition to disbursements for all other work and business done and all time spent by him or his firm in connection with matters arising in connection with these presents.

 

  (r) The Trustee may whenever it thinks fit delegate by power of attorney or otherwise to any person or persons or fluctuating body of persons (whether being a joint trustee of these presents or not) all or any of its trusts, powers, authorities and discretions under these presents. Such delegation may be made upon such terms (including power to sub-delegate) and subject to such conditions and regulations as the Trustee may in the interests of the Noteholders think fit. The Trustee shall not be under any obligation to supervise the proceedings or acts of any such delegate or sub-delegate or be in any way responsible for any Liability incurred by reason of any misconduct or default on the part of any such delegate or sub-delegate. The Trustee shall within a reasonable time after any such delegation or any renewal, extension or termination thereof give notice thereof to the Issuer.

 

  (s) The Trustee may in the conduct of the trusts of these presents instead of acting personally employ and pay an agent (whether being a lawyer or other professional person) to transact or conduct, or concur in transacting or conducting, any business and to do, or concur in doing, all acts required to be done in connection with these presents (including the receipt and payment of money). Provided that the Trustee shall have exercised reasonable care in the selection of such agent, the Trustee shall not be in any way responsible for any Liability incurred by reason of any misconduct or default on the part of any such agent or be bound to supervise the proceedings or acts of any such agent.

 

  (t)

The Trustee shall not be responsible for the execution, delivery, legality, effectiveness, adequacy, genuineness, validity, enforceability or admissibility in evidence of these presents or any other document relating or expressed to be supplemental thereto and shall not be liable for any failure to obtain any licence, consent or other authority for the execution, delivery, legality, effectiveness,

 

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adequacy, genuineness, validity, performance, enforceability or admissibility in evidence of these presents or any other document relating or expressed to be supplemental thereto.

 

  (u) The Trustee may rely on certificates or reports from the Auditors or any other person in accordance with the provisions of these presents whether or not any such certificate or report or engagement letter or other document entered into by the Trustee and the Auditors or such other person connection therewith contains any limit on the liability (monetary or otherwise) of the Auditors or such other person.

 

17. TRUSTEE’S LIABILITY

The duty of care contained in Section 1 of the Trustee Act 2000 shall not apply to these presents. However, nothing in these presents shall in any case in which the Trustee has failed to show the degree of care and diligence required of it as trustee having regard to the provisions of these presents conferring on it any trusts, powers, authorities or discretions exempt the Trustee from or indemnify it against any liability for breach of trust of which it may be guilty in relation to its duties under these presents.

 

18. TRUSTEE CONTRACTING WITH THE ISSUER AND THE GUARANTOR

Neither the Trustee nor any director or officer or holding company, Subsidiary or associated company of a corporation acting as a trustee under these presents shall by reason of its or his fiduciary position be in any way precluded from:

 

  (a) entering into or being interested in any contract or financial or other transaction or arrangement with the Issuer or the Guarantor or any person or body corporate associated with the Issuer or the Guarantor (including without limitation any contract, transaction or arrangement of a banking or insurance nature or any contract, transaction or arrangement in relation to the making of loans or the provision of financial facilities or financial advice to, or the purchase, placing or underwriting of or the subscribing or procuring subscriptions for or otherwise acquiring, holding or dealing with, or acting as paying agent in respect of, the Notes or any other notes, bonds, stocks, shares, debenture stock, debentures or other securities of, the Issuer or the Guarantor or any person or body corporate associated as aforesaid); or

 

  (b) accepting or holding the trusteeship of any other trust deed constituting or securing any other securities issued by or relating to the Issuer or the Guarantor or any such person or body corporate so associated or any other office of profit under the Issuer or the Guarantor or any such person or body corporate so associated,

and shall be entitled to exercise and enforce its rights, comply with its obligations and perform its duties under or in relation to any such contract, transaction or arrangement as is referred to in (a) above or, as the case may be, any such trusteeship or office of profit as is referred to in (b) above without regard to the interests of the Noteholders and notwithstanding that the same may be contrary or prejudicial to the interests of the Noteholders and shall not be responsible for any Liability occasioned to the Noteholders thereby and shall be entitled to retain and shall not be in any way liable to account for any profit made or share of brokerage or commission or remuneration or other amount or benefit received thereby or in connection therewith.

 

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Where any holding company, Subsidiary or associated company of the Trustee or any director or officer of the Trustee acting other than in his capacity as such a director or officer has any information, the Trustee shall not thereby be deemed also to have knowledge of such information and, unless it shall have actual knowledge of such information, shall not be responsible for any loss suffered by Noteholders resulting from the Trustee’s failing to take such information into account in acting or refraining from acting under or in relation to these presents.

 

19. WAIVER, AUTHORISATION AND DETERMINATION

 

19.1 The Trustee may without the consent or sanction of the Noteholders, the Receiptholders or the Couponholders and without prejudice to its rights in respect of any subsequent breach, Event of Default or Potential Event of Default from time to time and at any time but only if and in so far as in its opinion the interests of the Noteholders shall not be materially prejudiced thereby waive or authorise any breach or proposed breach by the Issuer or the Guarantor of any of the covenants or provisions contained in these presents or determine that any Event of Default or Potential Event of Default shall not be treated as such for the purposes of these presents PROVIDED ALWAYS THAT the Trustee shall not exercise any powers conferred on it by this Clause in contravention of any express direction given by Extraordinary Resolution or by a request under Condition 11 but so that no such direction or request shall affect any waiver, authorisation or determination previously given or made. Any such waiver, authorisation or determination may be given or made on such terms and subject to such conditions (if any) as the Trustee may determine, shall be binding on the Noteholders, the Receiptholders and the Couponholders and, if, but only if, the Trustee shall so require, shall be notified by the Issuer or the Guarantor to the Noteholders in accordance with Condition 15 as soon as practicable thereafter.

MODIFICATION

 

19.2 The Trustee may without the consent or sanction of the Noteholders, the Receiptholders or the Couponholders at any time and from time to time concur with the Issuer and the Guarantor in making any modification (a) to these presents which in the opinion of the Trustee it may be proper to make PROVIDED THAT the Trustee is of the opinion that such modification will not be materially prejudicial to the interests of the Noteholders or (b) to these presents if in the opinion of the Trustee such modification is of a formal, minor or technical nature or to correct a manifest or proven error or to comply with mandatory provisions of law. Any such modification may be made on such terms and subject to such conditions (if any) as the Trustee may determine, shall be binding upon the Noteholders, the Receiptholders and the Couponholders and, unless the Trustee agrees otherwise, shall be notified by the Issuer or the Guarantor to the Noteholders in accordance with Condition 15 as soon as practicable thereafter.

BREACH

 

19.3 Any breach of or failure to comply by the Issuer or the Guarantor (as the case may be) with any such terms and conditions as are referred to in sub-clauses 19.1 and 19.2 of this Clause shall constitute a default by the Issuer or the Guarantor (as the case may be) in the performance or observance of a covenant or provision binding on it under or pursuant to these presents.

 

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20. HOLDER OF DEFINITIVE NOTE ASSUMED TO BE RECEIPTHOLDER AND COUPONHOLDER

 

20.1 Wherever in these presents the Trustee is required or entitled to exercise a power, trust, authority or discretion under these presents, except as ordered by a court of competent jurisdiction or as required by applicable law, the Trustee shall, notwithstanding that it may have express notice to the contrary, assume that each Noteholder is the holder of all Receipts and Coupons appertaining to each Definitive Note of which he is the holder.

NO NOTICE TO RECEIPTHOLDERS OR COUPONHOLDERS

 

20.2 Neither the Trustee nor the Issuer nor the Guarantor shall be required to give any notice to the Receiptholders or Couponholders for any purpose under these presents and the Receiptholders or Couponholders shall be deemed for all purposes to have notice of the contents of any notice given to the holders of Notes in accordance with Condition 15.

 

21. CURRENCY INDEMNITY

Each of the Issuer and the Guarantor shall severally indemnify the Trustee, every Appointee, the Noteholders, the Receiptholders and the Couponholders and keep them indemnified against:

 

  (a) any Liability incurred by any of them arising from the non-payment by the Issuer or the Guarantor of any amount due to the Trustee or the holders of the Notes and the relative Receiptholders or Couponholders under these presents by reason of any variation in the rates of exchange between those used for the purposes of calculating the amount due under a judgment or order in respect thereof and those prevailing at the date of actual payment by the Issuer or, as the case may be, the Guarantor; and

 

  (b) any deficiency arising or resulting from any variation in rates of exchange between (i) the date as of which the local currency equivalent of the amounts due or contingently due under these presents (other than this Clause) is calculated for the purposes of any bankruptcy, insolvency or liquidation of the Issuer or the Guarantor and (ii) the final date for ascertaining the amount of claims in such bankruptcy, insolvency or liquidation. The amount of such deficiency shall be deemed not to be reduced by any variation in rates of exchange occurring between the said final date and the date of any distribution of assets in connection with any such bankruptcy, insolvency or liquidation.

The above indemnities shall constitute obligations of the Issuer or, as the case may be, the Guarantor separate and independent from their other obligations under the other provisions of these presents and shall apply irrespective of any indulgence granted by the Trustee or the Noteholders, the Receiptholders or the Couponholders from time to time and shall continue in full force and effect notwithstanding the judgment or filing of any proof or proofs in any bankruptcy, insolvency or liquidation of the Issuer or, as the case may be, the Guarantor for a liquidated sum or sums in respect of amounts due under these presents (other than this Clause). Any such deficiency as aforesaid shall be deemed to constitute a loss suffered by the Noteholders, the Receiptholders and the Couponholders and no proof or evidence of any actual loss shall be required by the Issuer or, as the case may be, the Guarantor or its or their liquidator or liquidators.

 

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22. NEW TRUSTEE

 

22.1 The power to appoint a new trustee of these presents shall be vested solely in the Issuer but no person shall be appointed who shall not previously have been approved by an Extraordinary Resolution. One or more persons may hold office as trustee or trustees of these presents but such trustee or trustees shall be or include a Trust Corporation. Whenever there shall be more than two trustees of these presents the majority of such trustees shall be competent to execute and exercise all the duties, powers, trusts, authorities and discretions vested in the Trustee by these presents PROVIDED THAT a Trust Corporation shall be included in such majority. Any appointment of a new trustee of these presents shall as soon as practicable thereafter be notified by the Issuer to the Agent and the Noteholders.

SEPARATE AND CO-TRUSTEES

 

22.2 Notwithstanding the provisions of sub-clause 22.1 above, the Trustee may, upon giving prior notice to the Issuer and the Guarantor (but without the consent of the Issuer, the Guarantor, the Noteholders, Receiptholders or Couponholders), appoint any person established or resident in any jurisdiction (whether a Trust Corporation or not) to act either as a separate trustee or as a co-trustee jointly with the Trustee:

 

  (a) if the Trustee considers such appointment to be in the interests of the Noteholders;

 

  (b) for the purposes of conforming to any legal requirements, restrictions or conditions in any jurisdiction in which any particular act or acts is or are to be performed; or

 

  (c) for the purposes of obtaining a judgment in any jurisdiction or the enforcement in any jurisdiction of either a judgment already obtained or any of the provisions of these presents against the Issuer or, as the case may be, the Guarantor.

The Issuer irrevocably appoints the Trustee to be its attorney in its name and on its behalf to execute any such instrument of appointment. Such a person shall (subject always to the provisions of these presents) have such trusts, powers, authorities and discretions (not exceeding those conferred on the Trustee by these presents) and such duties and obligations as shall be conferred or imposed by the instrument of appointment. The Trustee shall have power in like manner to remove any such person. Such reasonable remuneration as the Trustee may pay to any such person, together with any attributable Liabilities incurred by it in performing its function as such separate trustee or co-trustee, shall for the purposes of these presents be treated as Liabilities incurred by the Trustee.

 

23. SUBSTITUTION

 

23.1

  

(a)

      The Trustee may without the consent of the Noteholders, the Receiptholders or the Couponholders at any time agree with the Issuer and the Guarantor to the substitution in place of the Issuer (or of the previous substitute under this Clause) as the principal debtor under these presents of any Subsidiary of the Guarantor or the Issuer (such substituted company being hereinafter called the New Company) provided that a trust deed is executed or some other form of undertaking is given by the New Company in form and manner satisfactory to the Trustee, agreeing to be bound by the provisions of these presents with any consequential amendments which the Trustee may deem appropriate as fully as if the New Company had been named in these presents as the principal debtor in place of the Issuer (or of the previous substitute

 

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under the Clause) and provided further that (except where the New Company is the Guarantor) the Guarantor unconditionally and irrevocably guarantees all amounts payable under these presents to the satisfaction of the Trustee.

 

  (b) The following further conditions shall apply to 23.1(a) above:

 

  (i) the Issuer, the Guarantor and the New Company shall comply with such other requirements as the Trustee may direct in the interests of the Noteholders;

 

  (ii) where the New Company is subject generally to the taxing jurisdiction of a territory other than or in addition to the United Kingdom or any political sub-division or any authority therein or thereof having power to tax, undertakings or covenants shall be given by the New Company in terms corresponding to the provisions of Condition 9 with the substitution for (or, as the case may be, the addition to) the references to the United Kingdom of references to that other or additional territory to whose taxing jurisdiction the New Company is subject and (where applicable) Condition 8(b) shall be read and construed accordingly;

 

  (iii) without prejudice to the rights of reliance of the Trustee under the immediately following paragraph (iv), the Trustee is satisfied that the relevant transaction is not materially prejudicial to the interests of the Noteholders; and

 

  (iv) if two Directors of the New Company (or other officers acceptable to the Trustee) shall certify that the New Company is solvent at the time at which the relevant transaction is proposed to be effected (which certificate the Trustee may rely upon absolutely) the Trustee shall not be under any duty to have regard to the financial condition, profits or prospects of the New Company or to compare the same with those of the Issuer or the previous substitute under this Clause as applicable.

 

23.2 Any such trust deed or undertaking shall, if so expressed, operate to release the Issuer or the previous substitute as aforesaid from all of its obligations as principal debtor under these presents. Not later than 14 days after the execution of such documents and compliance with such requirements, the New Company shall give notice thereof in a form previously approved by the Trustee to the Noteholders in the manner provided in Condition 15. Upon the execution of such documents and compliance with such requirements, the New Company shall be deemed to be named in these presents as the principal debtor in place of the Issuer (or in place of the previous substitute under this Clause) under these presents and these presents shall be deemed to be modified in such manner as shall be necessary to give effect to the above provisions and, without limitation, references in these presents to the Issuer shall, unless the context otherwise requires, be deemed to be or include references to the New Company.

 

24. TRUSTEE’S RETIREMENT AND REMOVAL

A trustee of these presents may retire at any time on giving not less than three months’ prior written notice to the Issuer and the Guarantor without giving any reason and without being responsible for any Liabilities incurred by reason of such retirement. The Noteholders may by Extraordinary Resolution remove any trustee or trustees for the time being of these presents.

 

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The Issuer undertakes that in the event of the only trustee of these presents which is a Trust Corporation giving notice under this Clause or being removed by Extraordinary Resolution it will use its best endeavours to procure that a new trustee of these presents being a Trust Corporation is appointed as soon as reasonably practicable thereafter. The retirement or removal of any such trustee shall not become effective until a successor trustee being a Trust Corporation is appointed.

 

25. TRUSTEE’S POWERS TO BE ADDITIONAL

The powers conferred upon the Trustee by these presents shall be in addition to any powers which may from time to time be vested in the Trustee by the general law or as a holder of any of the Notes, Receipts or Coupons.

 

26. NOTICES

Any notice or demand to the Issuer, the Guarantor or the Trustee to be given, made or served for any purposes under these presents shall be given, made or served by sending the same by pre-paid post (first class if inland, first class airmail if overseas), telex or facsimile transmission or by delivering it by hand as follows:

 

to the Issuer:    East Putney House
   84 Upper Richmond Road
   London SW15 2ST
   (Attention:    Treasury)
   (Copy to the Guarantor)
   Facsimile No.    020 8877 5104
to the Guarantor:    East Putney House
   84 Upper Richmond Road
   London SW15 2ST
   (Attention:    Treasury)
   Facsimile No.    020 8877 5104
to the Trustee:    Fifth Floor
   100 Wood Street
   London EC4M 9QQ
   (Attention:    the Manager, Trust Management)
   Telex No.    888347
   Facsimile No.    020 7696 5261

or to such other address, telex or facsimile number as shall have been notified (in accordance with this Clause) to the other party hereto and any notice or demand sent by post as aforesaid shall be deemed to have been given, made or served three days in the case of inland post or seven days in the case of overseas post after despatch and any notice or demand sent by telex or facsimile transmission as aforesaid shall be deemed to have been given, made or served 24 hours after the time of despatch PROVIDED THAT in the case of a notice or demand given by telex or facsimile transmission such notice or demand shall forthwith be confirmed

 

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by post. The failure of the addressee to receive such confirmation shall not invalidate the relevant notice or demand given by telex or facsimile transmission.

 

27. GOVERNING LAW

These presents are governed by, and shall be construed in accordance with, English law.

 

28. CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

A person who is not a party to this Trust Deed or any trust deed supplemental hereto has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Trust Deed or any trust deed supplemental hereto, but this does not affect any right or remedy of a third party which exists or is available apart from that Act.

 

29. COUNTERPARTS

This Trust Deed and any trust deed supplemental hereto may be executed and delivered in any number of counterparts, all of which, taken together, shall constitute one and the same deed and any party to this Trust Deed or any trust deed supplemental hereto may enter into the same by executing and delivering a counterpart.

IN WITNESS whereof this Trust Deed has been executed as a deed by the Issuer, the Guarantor and the Trustee and delivered on the date first stated on page 1.

 

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SCHEDULE 1

TERMS AND CONDITIONS OF THE NOTES

[To be copied from Final Offering Circular]

 

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TERMS AND CONDITIONS OF THE NOTES

The following are the Terms and Conditions of the Notes which will be incorporated by reference into each Global Note (as defined below) and each definitive Note, in the latter case only if permitted by the relevant stock exchange or other relevant authority (if any) and agreed by the Issuer and the relevant Dealer at the time of issue but, if not so permitted and agreed, such definitive Note will have endorsed thereon or attached thereto such Terms and Conditions. The applicable Pricing Supplement in relation to any Tranche of Notes may specify other terms and conditions which shall, to the extent so specified or to the extent inconsistent with the following Terms and Conditions, replace or modify the following Terms and Conditions for the purpose of such Notes. The applicable Pricing Supplement (or the relevant provisions thereof) will be endorsed upon, or attached to, each Global Note and definitive Note. Reference should be made to “Form of the Notes” for a description of the content of Pricing Supplements which will specify which of such terms are to apply in relation to the relevant Notes.

This Note is one of a Series (as defined below) of Notes issued by Tomkins Finance plc (the “Issuer”) constituted by a Trust Deed (such Trust Deed as modified and/or supplemented and/or restated from time to time, most recently by the third supplemental trust deed dated 28th August, 2003 made between the Issuer, Tomkins plc (the “Guarantor”) as guarantor and the Trustee (as defined below), the “Trust Deed”) dated 26th October, 2001 made between Tomkins plc as issuer and The Law Debenture Trust Corporation p.l.c. (the “Trustee” which expression shall include any successor as trustee).

References herein to the “Notes” shall be references to the Notes of this Series and shall mean:

 

(i) in relation to any Notes represented by a global Note (a “Global Note”), units of the lowest Specified Denomination in the Specified Currency;

 

(ii) any Global Note; and

 

(iii) any definitive Notes issued in exchange for a Global Note.

The Notes, the Receipts (as defined below) and the Coupons (as defined below) have the benefit of an Agency Agreement (such Agency Agreement as amended and/or supplemented and/or restated from time to time, the “Agency Agreement”) dated 28th August, 2003 and made between the Issuer, the Guarantor, the Trustee, The Bank of New York, London Branch as issuing and principal paying agent and agent bank (the “Agent”, which expression shall include any successor agent) and the other paying agents named therein (together with the Agent, the “Paying Agents”, which expression shall include any additional or successor paying agents).

Interest bearing definitive Notes have interest coupons (“Coupons”) and, if indicated in the applicable Pricing Supplement, talons for further Coupons (“Talons”) attached on issue. Any reference herein to Coupons or coupons shall, unless the context otherwise requires, be deemed to include a reference to Talons or talons. Definitive Notes repayable in instalments have receipts (“Receipts”) for the payment of the instalments of principal (other than the final instalment) attached on issue. Global Notes do not have Receipts, Coupons or Talons attached on issue.

The Pricing Supplement for this Note (or the relevant provisions thereof) is attached to or endorsed on this Note and supplements these Terms and Conditions and may specify other terms and conditions which shall, to the extent so specified or to the extent inconsistent with these Terms and Conditions, replace or modify these Terms and Conditions for the purposes of this Note. References to the “applicable Pricing Supplement” are to the Pricing Supplement (or the relevant provisions thereof) attached to or endorsed on this Note.

The Trustee acts for the benefit of the holders for the time being of the Notes, the holders of the Receipts and the holders of the Coupons, in accordance with the provisions of the Trust Deed. Any reference to “Noteholders” or “holders” in relation to any Notes shall mean the holders of the Notes and shall, in relation to any Notes represented by a Global Note, be construed as provided below. Any reference herein to “Receiptholders” shall mean the holders of the Receipts and any reference herein to “Couponholders” shall mean the holders of the Coupons and shall, unless the context otherwise requires, include the holders of the Talons.

As used herein, “Tranche” means Notes which are identical in all respects (including as to listing) and “Series” means a Tranche of Notes together with any further Tranche or Tranches of Notes which are (i) expressed to be consolidated and form a single series and (ii) identical in all respects (including as to listing) except for their respective Issue Dates, Interest Commencement Dates and/or Issue Prices.

Copies of the Trust Deed and the Agency Agreement are available for inspection during normal business hours at the registered office for the time being of the Trustee (being, at 28th August, 2003, Fifth Floor, 100

 

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Wood Street, London EC2V 7EX) and at the specified office of the Agent and the other Paying Agents. Copies of the applicable Pricing Supplement are obtainable during normal business hours at the specified office of each of the Paying Agents save that, if this Note is an unlisted Note of any Series, the applicable Pricing Supplement will only be obtainable by a Noteholder holding one or more unlisted Notes of that Series and such Noteholder must produce evidence satisfactory to the Issuer or, as the case may be, the Guarantor and the Trustee or, as the case may be, the relevant Paying Agent as to its holding of such Notes and identity. The Noteholders, the Receiptholders and the Couponholders are deemed to have notice of, and are entitled to the benefit of, all the provisions of the Trust Deed, the Agency Agreement, the Deed Poll and the applicable Pricing Supplement which are applicable to them. The statements in these Terms and Conditions include summaries of, and are subject to, the detailed provisions of the Trust Deed and the Agency Agreement.

Words and expressions defined in the Trust Deed, the Agency Agreement or used in the applicable Pricing Supplement shall have the same meanings where used in these Terms and Conditions unless the context otherwise requires or unless otherwise stated and provided that, in the event of inconsistency between the Trust Deed and the Agency Agreement, the Trust Deed will prevail and, in the event of inconsistency between the Trust Deed or the Agency Agreement and the applicable Pricing Supplement, the applicable Pricing Supplement will prevail.

 

1 FORM, DENOMINATION AND TITLE

The Notes are in bearer form and, in the case of definitive Notes, serially numbered, in the Specified Currency and the Specified Denomination(s). Notes of one Specified Denomination may not be exchanged for Notes of another Specified Denomination.

This Note may be a Fixed Rate Note, a Floating Rate Note, a Zero Coupon Note, an Index Linked Interest Note, a Dual Currency Interest Note or a combination of any of the foregoing, depending upon the Interest Basis shown in the applicable Pricing Supplement.

This Note may be an Index Linked Redemption Note, an Instalment Note, a Dual Currency Redemption Note, a Partly Paid Note or a combination of any of the foregoing, depending upon the Redemption/Payment Basis shown in the applicable Pricing Supplement.

Definitive Notes are issued with Coupons attached, unless they are Zero Coupon Notes in which case references to Coupons and Couponholders in these Terms and Conditions are not applicable.

Subject as set out below, title to the Notes, Receipts and Coupons will pass by delivery. The Issuer, the Guarantor, the Trustee and the Paying Agents will (except as otherwise required by law) deem and treat the bearer of any Note, Receipt or Coupon as the absolute owner thereof (whether or not overdue and notwithstanding any notice of ownership or writing thereon or notice of any previous loss or theft thereof) for all purposes but, in the case of any Global Note, without prejudice to the provisions set out in the next succeeding paragraph.

For so long as any of the Notes is represented by a Global Note held on behalf of Euroclear Bank S.A./N.V. as operator of the Euroclear System (“Euroclear”) and/or Clearstream Banking, société anonyme (“Clearstream, Luxembourg”), each person (other than Euroclear or Clearstream, Luxembourg) who is for the time being shown in the records of Euroclear or of Clearstream, Luxembourg as the holder of a particular nominal amount of such Notes (in which regard any certificate or other document issued by Euroclear or Clearstream, Luxembourg as to the nominal amount of such Notes standing to the account of any person shall be conclusive and binding for all purposes save in the case of manifest error) shall be treated by the Issuer, the Guarantor, the Trustee and the Paying Agents as the holder of such nominal amount of such Notes for all purposes other than with respect to the payment of principal or interest on such nominal amount of such Notes, for which purpose the bearer of the relevant Global Note shall be treated by the Issuer, the Guarantor, the Trustee and any Paying Agent as the holder of such nominal amount of such Notes in accordance with and subject to the terms of the relevant Global Note and the expressions “Noteholder” and “holder of Notes” and related expressions shall be construed accordingly. In determining whether a particular person is entitled to a particular nominal amount of Notes as aforesaid, the Trustee may rely on such evidence and/or information and/or certification as it shall, in its absolute discretion, think fit and, if it does so rely, such evidence and/or information and/or certification shall, in the absence of manifest error, be conclusive and binding on all concerned.

Notes which are represented by a Global Note will be transferable only in accordance with the rules and procedures for the time being of Euroclear and Clearstream, Luxembourg, as the case may be. References to Euroclear and/or Clearstream, Luxembourg shall, whenever the context so permits, be

 

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deemed to include a reference to any additional or alternative clearing system specified in the applicable Pricing Supplement or as may otherwise be approved by the Issuer, the Agent and the Trustee.

 

2 GUARANTEE

The payment of principal and interest in respect of the Notes and all other moneys payable by the Issuer under or pursuant to the Trust Deed has been unconditionally and irrevocably guaranteed by the Guarantor in the Trust Deed (the “Guarantee”). The obligations of the Guarantor under the Guarantee are direct, unconditional, unsubordinated and (subject to the provisions of Condition 4) unsecured obligations of the Guarantor and (save as aforesaid and for certain obligations required to be preferred by law) rank equally with all other unsecured obligations (other than subordinated obligations, if any) of the Guarantor, from time to time outstanding.

 

3 STATUS OF THE NOTES

The Notes and any relative Receipts and Coupons are direct, unconditional, unsubordinated and (subject to the provisions of Condition 4) unsecured obligations of the Issuer and rank pari passu among themselves and (save as aforesaid and for certain obligations required to be preferred by law) equally with all other unsecured obligations (other than subordinated obligations, if any) of the Issuer, from time to time outstanding.

 

4 NEGATIVE PLEDGE

So long as any of the Notes remains outstanding, neither the Issuer nor the Guarantor will, and the Guarantor will ensure that each of its Subsidiaries (save for the Issuer) will not, secure any existing or future Debt Obligations or guarantees of Debt Obligations by means of a mortgage, pledge, lien or other security upon, or with respect to, any of its present or future undertaking, revenues or assets (including any uncalled capital) unless all amounts payable by the Issuer under the Notes, the Receipts, the Coupons and the Trust Deed and/or the Guarantor under the Trust Deed (as the case may be) are secured equally and rateably to the satisfaction of the Trustee by the same mortgage, pledge, lien or other security or such other security interest or other arrangement (whether or not including the giving of a security interest) is provided either (a) as the Trustee shall in its absolute discretion deem not materially less beneficial to the interests of the Noteholders or (b) as shall be approved by an Extraordinary Resolution (as defined in the Trust Deed) of the Noteholders.

In these Conditions, the following expressions have the following meanings:

“Debt Obligations” means any indebtedness which is in the form of or represented by notes, bonds or other securities which are, or are intended to be, quoted, listed or dealt in or on any stock exchange or over-the-counter market; and

“Subsidiary” has the meaning given to that term in Section 736 of the Companies Act 1985.

 

5 REDENOMINATION

 

  (a) Redenomination

Where redenomination is specified in the applicable Pricing Supplement as being applicable, the Issuer may, without the consent of the Noteholders, the Receiptholders and the Couponholders, on giving prior notice to the Trustee, the Agent, Euroclear and Clearstream, Luxembourg and at least 30 days’ prior notice to the Noteholders in accordance with Condition 15, elect that, with effect from the Redenomination Date specified in the notice, the Notes shall be redenominated in euro.

The election will have effect as follows:

 

  (i)

the Notes and the Receipts shall be deemed to be redenominated into euro in the denomination of euro 0.01 with a principal amount for each Note and Receipt equal to the principal amount of that Note or Receipt in the Specified Currency, converted into euro at the Established Rate, provided that, if the Issuer determines, with the agreement of the Agent and with the prior written approval of the Trustee, that the then market practice in respect of the redenomination into euro of internationally offered securities is different from the provisions specified above, such provisions shall be deemed to be amended so as to

 

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comply with such market practice and the Issuer shall promptly notify the Noteholders, the stock exchange (if any) on which the Notes may be listed and the Paying Agents of such deemed amendments;

 

  (ii) save to the extent that an Exchange Notice has been given in accordance with paragraph (iv) below, the amount of interest due in respect of the Notes will be calculated by reference to the aggregate principal amount of Notes presented (or, as the case may be, in respect of which Coupons are presented) for payment by the relevant holder and the amount of such payment shall be rounded down to the nearest euro 0.01;

 

  (iii) if definitive Notes are required to be issued after the Redenomination Date, they shall be issued at the expense of the Issuer in the denominations of euro 1,000, euro 10,000, euro 100,000 and (but only to the extent of any remaining amounts less than euro 1,000 or such smaller denominations as the Agent and the Trustee may approve) euro 0.01 and such other denominations as the Agent shall determine and notify to the Noteholders;

 

  (iv) if issued prior to the Redenomination Date, all unmatured Coupons denominated in the Specified Currency (whether or not attached to the Notes) will become void with effect from the date on which the Issuer gives notice (the “Exchange Notice”) that replacement euro-denominated Notes, Receipts and Coupons are available for exchange (provided that such securities are so available) and no payments will be made in respect of them. The payment obligations contained in any Notes and Receipts so issued will also become void on that date although those Notes and Receipts will continue to constitute valid exchange obligations of the Issuer. New euro-denominated Notes, Receipts and Coupons will be issued in exchange for Notes, Receipts and Coupons denominated in the Specified Currency in such manner as the Agent may specify and as shall be notified to the Noteholders in the Exchange Notice. No Exchange Notice may be given less than 15 days prior to any date for payment of principal or interest on the Notes;

 

  (v) after the Redenomination Date, all payments in respect of the Notes, the Receipts and the Coupons, other than payments of interest in respect of periods commencing before the Redenomination Date, will be made solely in euro as though references in the Notes to the Specified Currency were to euro. Payments will be made in euro by credit or transfer to a euro account (or any other account to which euro may be credited or transferred) specified by the payee or, at the option of the payee, by a euro cheque;

 

  (vi) if the Notes are Fixed Rate Notes and interest for any period ending on or after the Redenomination Date is required to be calculated for a period ending other than on an Interest Payment Date, it will be calculated by applying the Rate of Interest to each Specified Denomination, multiplying such sum by the applicable Day Count Fraction, and rounding the resultant figure to the nearest sub-unit of the relevant Specified Currency, half of any such sub-unit being rounded upwards or otherwise in accordance with applicable market convention; and

 

  (vii) if the Notes are Floating Rate Notes, the applicable Pricing Supplement will specify any relevant changes to the provisions relating to interest.

 

  (b) Definitions

In these Conditions, the following expressions have the following meanings:

“Established Rate” means the rate for the conversion of the Specified Currency (including compliance with rules relating to roundings in accordance with applicable European Community regulations) into euro established by the Council of the European Union pursuant to Article 123 of the Treaty;

“euro” means the currency introduced at the start of the third stage of European economic and monetary union pursuant to the Treaty;

“Redenomination Date” means (in the case of interest bearing Notes) any date for payment of interest under the Notes or (in the case of Zero Coupon Notes) any date, in each case specified by the Issuer in the notice given to the Noteholders pursuant to paragraph (a) above and which falls on or after the date on which the country of the Specified Currency first participates in the third stage of European economic and monetary union; and

“Treaty” means the Treaty establishing the European Community, as amended.

 

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6 INTEREST

 

  (a) Interest on Fixed Rate Notes

Each Fixed Rate Note bears interest on its outstanding nominal amount (or, if it is a Partly Paid Note, the amount paid up) from (and including) the Interest Commencement Date at the rate(s) per annum equal to the Rate(s) of Interest. Interest will be payable in arrear on the Interest Payment Date(s) in each year up to (and including) the Maturity Date.

Except as provided in the applicable Pricing Supplement, the amount of interest payable on each Interest Payment Date in respect of the Fixed Interest Period ending on (but excluding) such date will amount to the Fixed Coupon Amount. Payments of interest on any Interest Payment Date will, if so specified in the applicable Pricing Supplement, amount to the Broken Amount so specified.

As used in these Conditions, “Fixed Interest Period” means the period from (and including) an Interest Payment Date (or the Interest Commencement Date) to (but excluding) the next (or first) Interest Payment Date.

If interest is required to be calculated for a period other than a Fixed Interest Period, such interest shall be calculated by applying the Rate of Interest to each Specified Denomination, multiplying such sum by the applicable Day Count Fraction, and rounding the resultant figure to the nearest sub-unit of the relevant Specified Currency, half of any such sub-unit being rounded upwards or otherwise in accordance with applicable market convention.

“Day Count Fraction” means, in respect of the calculation of an amount of interest, in accordance with this Condition 6(a):

 

  (i) if “Actual/Actual (ISMA)” is specified in the applicable Pricing Supplement:

 

  (a) in the case of Notes where the number of days in the relevant period from (and including) the most recent Interest Payment Date (or, if none, the Interest Commencement Date) to (but excluding) the relevant payment date (the “Accrual Period”) is equal to or shorter than the Determination Period during which the Accrual Period ends, the number of days in such Accrual Period divided by the product of (1) the number of days in such Determination Period and (2) the number of Determination Dates (as specified in the applicable Pricing Supplement) that would occur in one calendar year; or

 

  (b) in the case of Notes where the Accrual Period is longer than the Determination Period during which the Accrual Period ends, the sum of:

 

  (1) the number of days in such Accrual Period falling in the Determination Period in which the Accrual Period begins divided by the product of (x) the number of days in such Determination Period and (y) the number of Determination Dates that would occur in one calendar year; and

 

  (2) the number of days in such Accrual Period falling in the next Determination Period divided by the product of (x) the number of days in such Determination Period and (y) the number of Determination Dates that would occur in one calendar year; and

 

  (ii) if “30/360” is specified in the applicable Pricing Supplement, the number of days in the period from (and including) the most recent Interest Payment Date (or, if none, the Interest Commencement Date) to (but excluding) the relevant payment date (such number of days being calculated on the basis of a year of 360 days with 12 30-day months) divided by 360.

In these Conditions, the following expressions have the following meanings:

“Determination Period” means each period from (and including) a Determination Date to (but excluding) the next Determination Date (including, where either the Interest Commencement Date or the final Interest Payment Date is not a Determination Date, the period commencing on the first Determination Date prior to, and ending on the first Determination Date falling after, such date); and

“sub-unit” means, with respect to any currency other than euro, the lowest amount of such currency that is available as legal tender in the country of such currency and, with respect to euro, one cent.

 

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  (b) Interest on Floating Rate Notes and Index Linked Interest Notes

 

  (i) Interest Payment Dates

Each Floating Rate Note and Index Linked Interest Note bears interest on its outstanding nominal amount (or, if it is a Partly Paid Note, the amount paid up) from (and including) the Interest Commencement Date and such interest will be payable in arrear on either:

 

  (A) the Specified Interest Payment Date(s) in each year specified in the applicable Pricing Supplement; or

 

  (B) if no Specified Interest Payment Date(s) is/are specified in the applicable Pricing Supplement, each date (each such date, together with each Specified Interest Payment Date, an “Interest Payment Date”) which falls the number of months or other period specified as the Specified Period in the applicable Pricing Supplement after the preceding Interest Payment Date or, in the case of the first Interest Payment Date, after the Interest Commencement Date.

Such interest will be payable in respect of each Interest Period (which expression shall, in these Terms and Conditions, mean the period from (and including) an Interest Payment Date (or the Interest Commencement Date) to (but excluding) the next (or first) Interest Payment Date).

If a Business Day Convention is specified in the applicable Pricing Supplement and (x) if there is no numerically corresponding day on the calendar month in which an Interest Payment Date should occur or (y) if any Interest Payment Date would otherwise fall on a day which is not a Business Day, then, if the Business Day Convention specified is:

 

  (1) in any case where Specified Periods are specified in accordance with Condition 6(b)(i)(B) above, the Floating Rate Convention, such Interest Payment Date (i) in the case of (x) above, shall be the last day that is a Business Day in the relevant month and the provisions of (B) below shall apply mutatis mutandis or (ii) in the case of (y) above, shall be postponed to the next day which is a Business Day unless it would thereby fall into the next calendar month, in which event (A) such Interest Payment Date shall be brought forward to the immediately preceding Business Day and (B) each subsequent Interest Payment Date shall be the last Business Day in the month which falls the Specified Period after the preceding applicable Interest Payment Date occurred; or

 

  (2) the Following Business Day Convention, such Interest Payment Date shall be postponed to the next day which is a Business Day; or

 

  (3) the Modified Following Business Day Convention, such Interest Payment Date shall be postponed to the next day which is a Business Day unless it would thereby fall into the next calendar month, in which event such Interest Payment Date shall be brought forward to the immediately preceding Business Day; or

 

  (4) the Preceding Business Day Convention, such Interest Payment Date shall be brought forward to the immediately preceding Business Day.

In these Conditions, “Business Day” means a day which is both:

 

  (A) a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in London and any Additional Business Centre specified in the applicable Pricing Supplement; and

 

  (B) either (1) in relation to any sum payable in a Specified Currency other than euro, a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in the principal financial centre of the country of the relevant Specified Currency (if other than London and any Additional Business Centre and which, if the Specified Currency is Australian dollars or New Zealand dollars, shall be Sydney and Auckland, respectively) or (2) in relation to any sum payable in euro, a day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET) System (the “TARGET System”) is open.

 

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  (ii) Rate of Interest

The Rate of Interest payable from time to time in respect of Floating Rate Notes and Index Linked Interest Notes will be determined in the manner specified in the applicable Pricing Supplement.

 

  (A) ISDA Determination for Floating Rate Notes

Where ISDA Determination is specified in the applicable Pricing Supplement as the manner in which the Rate of Interest is to be determined, the Rate of Interest for each Interest Period will be the relevant ISDA Rate plus or minus (as indicated in the applicable Pricing Supplement) the Margin (if any). For the purposes of this sub-paragraph (A), “ISDA Rate” for an Interest Period means a rate equal to the Floating Rate that would be determined by the Agent under an interest rate swap transaction if the Agent were acting as Calculation Agent for that swap transaction under the terms of an agreement incorporating the 2000 ISDA Definitions as published by the International Swaps and Derivatives Association, Inc. and as amended and updated as at the Issue Date of the first Tranche of the Notes (the “ISDA Definitions”) and under which:

 

  (1) the Floating Rate Option is as specified in the applicable Pricing Supplement;

 

  (2) the Designated Maturity is a period specified in the applicable Pricing Supplement; and

 

  (3) the relevant Reset Date is either (i) if the applicable Floating Rate Option is based on the London inter-bank offered rate (“LIBOR”) or on the Euro-zone inter-bank offered rate (“EURIBOR”), the first day of that Interest Period or (ii) in any other case, as specified in the applicable Pricing Supplement.

For the purposes of this sub-paragraph (A), “Floating Rate”, “Calculation Agent”, “Floating Rate Option”, “Designated Maturity” and “Reset Date” have the meanings given to those terms in the ISDA Definitions.

 

  (B) Screen Rate Determination for Floating Rate Notes

Where Screen Rate Determination is specified in the applicable Pricing Supplement as the manner in which the Rate of Interest is to be determined, the Rate of Interest for each Interest Period will, subject as provided below, be either:

(1) the offered quotation; or

(2) the arithmetic mean (rounded if necessary to the fifth decimal place, with 0.000005 being rounded upwards) of the offered quotations,

(expressed as a percentage rate per annum) for the Reference Rate which appears or appear, as the case may be, on the Relevant Screen Page as at 11.00 a.m. (London time, in the case of LIBOR, or Brussels time, in the case of EURIBOR) on the Interest Determination Date in question plus or minus (as indicated in the applicable Pricing Supplement) the Margin (if any), all as determined by the Agent. If five or more of such offered quotations are available on the Relevant Screen Page, the highest (or, if there is more than one such highest quotation, one only of such quotations) and the lowest (or, if there is more than one such lowest quotation, one only of such quotations) shall be disregarded by the Agent for the purpose of determining the arithmetic mean (rounded as provided above) of such offered quotations.

The Agency Agreement contains provisions for determining the Rate of Interest in the event that the Relevant Screen Page is not available or if, in the case of (1) above, no such offered quotation appears or, in the case of (2) above, fewer than three such offered quotations appear, in each case as at the time specified in the preceding paragraph.

If the Reference Rate from time to time in respect of Floating Rate Notes is specified in the applicable Pricing Supplement as being other than LIBOR or EURIBOR, the Rate of Interest in respect of such Notes will be determined as provided in the applicable Pricing Supplement.

 

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  (iii) Minimum Rate of Interest and/or Maximum Rate of Interest

If the applicable Pricing Supplement specifies a Minimum Rate of Interest for any Interest Period, then, in the event that the Rate of Interest in respect of such Interest Period determined in accordance with the provisions of paragraph (ii) above is less than such Minimum Rate of Interest, the Rate of Interest for such Interest Period shall be such Minimum Rate of Interest.

If the applicable Pricing Supplement specifies a Maximum Rate of Interest for any Interest Period, then, in the event that the Rate of Interest in respect of such Interest Period determined in accordance with the provisions of paragraph (ii) above is greater than such Maximum Rate of Interest, the Rate of Interest for such Interest Period shall be such Maximum Rate of Interest.

 

  (iv) Determination of Rate of Interest and calculation of Interest Amounts

The Agent, in the case of Floating Rate Notes, and the Calculation Agent, in the case of Index Linked Interest Notes, will at or as soon as practicable after each time at which the Rate of Interest is to be determined, determine the Rate of Interest for the relevant Interest Period. In the case of Index Linked Interest Notes, the Calculation Agent will notify the Agent of the Rate of Interest for the relevant Interest Period as soon as practicable after calculating the same.

The Agent will calculate the amount of interest (the “Interest Amount”) payable on the Floating Rate Notes or Index Linked Interest Notes in respect of each Specified Denomination for the relevant Interest Period. Each Interest Amount shall be calculated by applying the Rate of Interest to each Specified Denomination, multiplying such sum by the applicable Day Count Fraction, and rounding the resultant figure to the nearest sub-unit of the relevant Specified Currency, half of any such sub-unit being rounded upwards or otherwise in accordance with applicable market convention.

“Day Count Fraction” means, in respect of the calculation of an amount of interest in accordance with this Condition 6:

 

  (i) if “Actual/365” or “Actual/Actual” is specified in the applicable Pricing Supplement, the actual number of days in the Interest Period divided by 365 (or, if any portion of that Interest Period falls in a leap year, the sum of (A) the actual number of days in that portion of the Interest Period falling in a leap year divided by 366 and (B) the actual number of days in that portion of the Interest Period falling in a non-leap year divided by 365);

 

  (ii) if “Actual/365 (Fixed)” is specified in the applicable Pricing Supplement, the actual number of days in the Interest Period divided by 365;

 

  (iii) if “Actual/365 (Sterling)” is specified in the applicable Pricing Supplement, the actual number of days in the Interest Period divided by 365 or, in the case of an Interest Payment Date falling in a leap year, 366;

 

  (iv) if “Actual/360” is specified in the applicable Pricing Supplement, the actual number of days in the Interest Period divided by 360;

 

  (v) if “30/360”, “360/360” or “Bond Basis” is specified in the applicable Pricing Supplement, the number of days in the Interest Period divided by 360 (the number of days to be calculated on the basis of a year of 360 days with 12 30-day months (unless (a) the last day of the Interest Period is the 31st day of a month but the first day of the Interest Period is a day other than the 30th or 31st day of a month, in which case the month that includes that last day shall not be considered to be shortened to a 30-day month, or (b) the last day of the Interest Period is the last day of the month of February, in which case the month of February shall not be considered to be lengthened to a 30-day month)); and

 

  (vi) if “30E/360” or “Eurobond Basis” is specified in the applicable Pricing Supplement, the number of days in the Interest Period divided by 360 (the number of days to be calculated on the basis of a year of 360 days with 12 30-day months, without regard to the date of the first day or last day of the Interest Period unless, in the case of the final Interest Period, the Maturity Date is the last day of the month of February, in which case the month of February shall not be considered to be lengthened to a 30-day month).

 

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  (v) Notification of Rate of Interest and Interest Amounts

The Agent will cause the Rate of Interest and each Interest Amount for each Interest Period and the relevant Interest Payment Date to be notified to the Issuer, the Trustee and any stock exchange or other relevant authority on which the relevant Floating Rate Notes or Index Linked Interest Notes are for the time being listed or by which they have been admitted to listing and notice thereof to be published in accordance with Condition 15 as soon as possible after their determination but in no event later than the fourth London Business Day thereafter. Each Interest Amount and Interest Payment Date so notified may subsequently be amended (or appropriate alternative arrangements made by way of adjustment) without prior notice in the event of an extension or shortening of the Interest Period. Any such amendment will be promptly notified to each stock exchange or other relevant authority on which the relevant Floating Rate Notes or Index Linked Interest Notes are for the time being listed or by which they have been admitted to listing and to the Noteholders in accordance with Condition 15. For the purposes of this paragraph, the expression “London Business Day” means a day (other than a Saturday or a Sunday) on which banks and foreign exchange markets are open for general business in London.

 

  (vi) Determination or Calculation by Trustee

If for any reason the Agent or, as the case may be, the Calculation Agent at any time after the Issue Date defaults in its obligation to determine the Rate of Interest or the Agent defaults in its obligation to calculate any Interest Amount in accordance with sub-paragraphs (ii) and (iv) above, the Trustee shall, if practicable in the circumstances, determine the Rate of Interest and/or Interest Amount in accordance with the said sub-paragraphs. If the Trustee is not so able to determine the Rate of Interest and/or Interest Amount, the Trustee shall determine the Rate of Interest at such rate as, in its absolute discretion (having such regard as it shall think fit to the foregoing provisions of this Condition, but subject always to any Minimum Rate of Interest or Maximum Rate of Interest specified in the applicable Pricing Supplement), it shall deem fair and reasonable in all the circumstances or, as the case may be, the Trustee shall calculate the Interest Amount(s) in such manner as it shall deem fair and reasonable in all the circumstances and each such determination or calculation shall be deemed to have been made by the Agent or the Calculation Agent, as applicable.

 

  (vii) Certificates to be final

All certificates, communications, opinions, determinations, calculations, quotations and decisions given, expressed, made or obtained for the purposes of the provisions of this Condition 6(b), the Calculation Agent, shall (in the absence of wilful default, bad faith or manifest error) be binding on the Issuer, the Guarantor, the Agent, the Calculation Agent (if applicable), the other Paying Agents and all Noteholders, Receiptholders and Couponholders and (in the absence as aforesaid) no liability to the Issuer, the Guarantor, the Noteholders, the Receiptholders or the Couponholders shall attach to the Trustee in connection with the exercise or non-exercise by it of its powers, duties and discretions pursuant to such provisions and no liability to the Noteholders, the Receiptholders or the Couponholders shall attach to the Agent or the Calculation Agent (if applicable) in connection with the exercise or non-exercise by it of its powers, duties and discretions pursuant to such provisions.

 

  (c) Interest on Dual Currency Interest Notes

The rate or amount of interest payable in respect of Dual Currency Interest Notes shall be determined in the manner specified in the applicable Pricing Supplement.

 

  (d) Interest on Partly Paid Note

In the case of Partly Paid Notes (other than Partly Paid Notes which are Zero Coupon Notes), interest will accrue as aforesaid on the paid-up nominal amount of such Notes and otherwise as specified in the applicable Pricing Supplement.

 

  (e) Accrual of interest

Each Note (or in the case of the redemption of part only of a Note, that part only of such Note) will cease to bear interest (if any) from the date for its redemption unless, upon due presentation thereof, payment of principal is improperly withheld or refused. In such event, interest will continue to accrue as provided in the Trust Deed.

 

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7 PAYMENTS

 

  (a) Method of payment

Subject as provided below:

 

  (i) payments in a Specified Currency other than euro will be made by credit or transfer to an account in the relevant Specified Currency (which, in the case of a payment in Japanese yen to a non-resident of Japan, shall be a non-resident account) maintained by the payee with, or, at the option of the payee, by a cheque in such Specified Currency drawn on, a bank in the principal financial centre of the country of such Specified Currency (which, if the Specified Currency is Australian dollars or New Zealand dollars, shall be Sydney and Auckland, respectively); and

 

  (ii) payments in euro will be made by credit or transfer to a euro account (or any other account to which euro may be credited or transferred) specified by the payee or, at the option of the payee, by a euro cheque.

Payments will be subject in all cases to any fiscal or other laws and regulations applicable thereto in the place of payment, but without prejudice to the provisions of Condition 9.

 

  (b) Presentation of definitive Notes, Receipts and Coupons

Payments of principal in respect of definitive Notes will (subject as provided below) be made in the manner provided in paragraph (a) above only against presentation and surrender (or, in the case of part payment of any sum due, endorsement) of definitive Notes, and payments of interest in respect of definitive Notes will (subject as provided below) be made as aforesaid only against presentation and surrender (or, in the case of part payment of any sum due, endorsement) of Coupons, in each case at the specified office of any Paying Agent outside the United States (which expression, as used herein, means the United States of America (including the States and the District of Columbia, its territories, its possessions and other areas subject to its jurisdiction)).

Payments of instalments of principal (if any) in respect of definitive Notes, other than the final instalment, will (subject as provided below) be made in the manner provided in paragraph (a) above against presentation and surrender (or, in the case of part payment of any sum due, endorsement) of the relevant Receipt in accordance with the preceding paragraph. Payment of the final instalment will be made in the manner provided in paragraph (a) above only against presentation and surrender (or, in the case of part payment of any sum due, endorsement) of the relevant Note in accordance with the preceding paragraph. Each Receipt must be presented for payment of the relevant instalment together with the definitive Note to which it appertains. Receipts presented without the definitive Note to which they appertain do not constitute valid obligations of the Issuer. Upon the date on which any definitive Note becomes due and repayable, unmatured Receipts (if any) relating thereto (whether or not attached) shall become void and no payment shall be made in respect thereof.

Fixed Rate Notes in definitive form (other than Dual Currency Notes, Index Linked Notes or Long Maturity Notes (as defined below)) should be presented for payment together with all unmatured Coupons appertaining thereto (which expression shall for this purpose include Coupons falling to be issued on exchange of matured Talons), failing which the amount of any missing unmatured Coupon (or, in the case of payment not being made in full, the same proportion of the amount of such missing unmatured Coupon as the sum so paid bears to the sum due) will be deducted from the sum due for payment. Each amount of principal so deducted will be paid in the manner mentioned above against surrender of the relative missing Coupon at any time before the expiry of 10 years after the Relevant Date (as defined in Condition 9) in respect of such principal (whether or not such Coupon would otherwise have become void under Condition 10) or, if later, five years from the date on which such Coupon would otherwise have become due, but in no event thereafter.

Upon any Fixed Rate Note in definitive form becoming due and repayable prior to its Maturity Date, all unmatured Talons (if any) appertaining thereto will become void and no further Coupons will be issued in respect thereof.

Upon the date on which any Floating Rate Note, Dual Currency Note, Index Linked Note or Long Maturity Note in definitive form becomes due and repayable, unmatured Coupons and Talons (if any) relating thereto (whether or not attached) shall become void and no payment or, as the case may be, exchange for further Coupons shall be made in respect thereof.

 

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For the purposes of these Conditions, a “Long Maturity Note” is a Fixed Rate Note (other than a Fixed Rate Note which on issue had a Talon attached) whose nominal amount on issue is less than the aggregate interest payable thereon provided that such Note shall cease to be a Long Maturity Note on the Interest Payment Date on which the aggregate amount of interest remaining to be paid after that date is less than the nominal amount of such Note.

If the due date for redemption of any definitive Note is not an Interest Payment Date, interest (if any) accrued in respect of such Note from (and including) the preceding Interest Payment Date or, as the case may be, the Interest Commencement Date shall be payable only against surrender of the relevant definitive Note.

 

  (c) Payments in respect of Global Notes

Payments of principal and interest (if any) in respect of Notes represented by any Global Note will (subject as provided below) be made in the manner specified above in relation to definitive Notes and otherwise in the manner specified in the relevant Global Note against presentation or surrender, as the case may be, of such Global Note at the specified office of any Paying Agent outside the United States. A record of each payment made against presentation or surrender of any Global Note, distinguishing between any payment of principal and any payment of interest, will be made on such Global Note by the Paying Agent to which it was presented and such record shall be prima facie evidence that the payment in question has been made.

 

  (d) General provisions applicable to payments

The holder of a Global Note shall be the only person entitled to receive payments in respect of Notes represented by such Global Note and the Issuer or, as the case may be, the Guarantor will be discharged by payment to, or to the order of, the holder of such Global Note in respect of each amount so paid. Each of the persons shown in the records of Euroclear or Clearstream, Luxembourg as the beneficial holder of a particular nominal amount of Notes represented by such Global Note must look solely to Euroclear or Clearstream, Luxembourg, as the case may be, for his share of each payment so made by the Issuer or, as the case may be, the Guarantor to, or to the order of, the holder of such Global Note.

Notwithstanding the foregoing provisions of this Condition, if any amount of principal and/or interest in respect of Notes is payable in U.S. dollars, such U.S. dollar payments of principal and/or interest in respect of such Notes will be made at the specified office of a Paying Agent in the United States if:

 

  (i) the Issuer has appointed Paying Agents with specified offices outside the United States with the reasonable expectation that such Paying Agents would be able to make payment in U.S. dollars at such specified offices outside the United States of the full amount of principal and interest on the Notes in the manner provided above when due;

 

  (ii) payment of the full amount of such principal and interest at all such specified offices outside the United States is illegal or effectively precluded by exchange controls or other similar restrictions on the full payment or receipt of principal and interest in U.S. dollars; and

 

  (iii) such payment is then permitted under United States law without involving, in the opinion of the Issuer and the Guarantor, adverse tax consequences to the Issuer or the Guarantor.

 

  (e) Payment Day

If the date for payment of any amount in respect of any Note, Receipt or Coupon is not a Payment Day, the holder thereof shall not be entitled to payment until the next following Payment Day in the relevant place and shall not be entitled to further interest or other payment in respect of such delay. For these purposes, “Payment Day” means any day which (subject to Condition 10) is:

 

  (i) a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in:

 

  (A) the relevant place of presentation;

 

  (B) London;

 

  (C) any Additional Financial Centre specified in the applicable Pricing Supplement; and

 

  (ii)

either (1) in relation to any sum payable in a Specified Currency other than euro, a day on which commercial banks and foreign exchange markets settle payments and are open for

 

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general business (including dealing in foreign exchange and foreign currency deposits) in the principal financial centre of the country of the relevant Specified Currency (if other than the place of presentation, London and any Additional Financial Centre and which, if the Specified Currency is Australian dollars or New Zealand dollars, shall be Sydney and Auckland, respectively) or (2) in relation to any sum payable in euro, a day on which the TARGET System is open.

 

  (f) Interpretation of principal and interest

Any reference in these Terms and Conditions to principal in respect of the Notes shall be deemed to include, as applicable:

 

  (i) any additional amounts which may be payable with respect to principal under Condition 9 or under any undertaking given in addition thereto or in substitution therefor pursuant to the Trust Deed;

 

  (ii) the Final Redemption Amount of the Notes;

 

  (iii) the Early Redemption Amount of the Notes;

 

  (iv) the Optional Redemption Amount(s) (if any) of the Notes;

 

  (v) in relation to Notes redeemable in instalments, the Instalment Amounts;

 

  (vi) in relation to Zero Coupon Notes, the Amortised Face Amount (as defined in Condition 8(e)); and

 

  (vii) any premium and any other amounts (other than interest) which may be payable by the Issuer under or in respect of the Notes.

Any reference in these Terms and Conditions to interest in respect of the Notes shall be deemed to include, as applicable, any additional amounts which may be payable with respect to interest under Condition 9 or under any undertaking given in addition thereto or in substitution therefor pursuant to the Trust Deed.

 

8 REDEMPTION AND PURCHASE

 

  (a) Redemption at maturity

Unless previously redeemed or purchased and in each case cancelled as specified below, each Note (including each Index Linked Redemption Note and Dual Currency Redemption Note) will be redeemed by the Issuer at its Final Redemption Amount specified in, or determined in the manner specified in, the applicable Pricing Supplement in the relevant Specified Currency on the Maturity Date.

 

  (b) Redemption for tax reasons

This Note may be redeemed at the option of the Issuer in whole, but not in part, at any time (if this Note is neither a Floating Rate Note, an Index Linked Interest Note nor a Dual Currency Interest Note) or on any Interest Payment Date (if this Note is either a Floating Rate Note, an Index Linked Interest Note or a Dual Currency Interest Note), on giving not less than 30 nor more than 60 days’ notice to the Trustee and the Agent and, in accordance with Condition 15, the Noteholders (which notice shall be irrevocable), if immediately prior to the giving of such notice the Issuer satisfies the Trustee that:

 

  (i) on the occasion of the next payment due under the Notes, the Issuer has or will become obliged to pay additional amounts as provided or referred to in Condition 9 or the Guarantor would be unable for reasons outside its control to procure payment by the Issuer and in making payment itself would be required to pay such additional amounts, in each case as a result of any change in, or amendment to, the laws or regulations of a Tax Jurisdiction (as defined in Condition 9) or any change in the application or official interpretation of such laws or regulations, which change or amendment becomes effective on or after the date on which agreement is reached to issue the first Tranche of the Notes; and

 

  (ii) such obligation cannot be avoided by the Issuer or, as the case may be, the Guarantor taking reasonable measures available to it,

provided that no such notice of redemption shall be given earlier than 90 days prior to the earliest date on which the Issuer or, as the case may be, the Guarantor would be obliged to pay such additional amounts were a payment in respect of the Notes then due.

 

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Prior to the publication of any notice of redemption pursuant to this Condition, the Issuer shall deliver to the Trustee a certificate signed by two Directors of the Issuer or, as the case may be, two Directors of the Guarantor stating that the Issuer is entitled to effect such redemption and setting forth a statement of facts showing that the conditions precedent to the right of the Issuer so to redeem have occurred, and an opinion of independent legal advisers of recognised standing to the effect that the Issuer or, as the case may be, the Guarantor has or will become obliged to pay such additional amounts as a result of such change or amendment and the Trustee shall be entitled to accept the certificate and opinion as sufficient evidence of the satisfaction of the conditions precedent set out above, in which event it shall be conclusive and binding on the Noteholders, the Receiptholders and the Couponholders.

Notes redeemed pursuant to this Condition 8(b) will be redeemed at their Early Redemption Amount referred to in paragraph (e) below together (if appropriate) with interest accrued to (but excluding) the date of redemption.

 

  (c) Redemption at the option of the Issuer (Issuer Call)

If Issuer Call is specified in the applicable Pricing Supplement, the Issuer may, having given:

 

  (i) not less than 15 nor more than 30 days’ notice to the Noteholders in accordance with Condition 15; and

 

  (ii) not less than 15 days before the giving of the notice referred to in (i), notice to the Trustee and to the Agent;

(which notices shall be irrevocable and shall specify the date fixed for redemption), redeem all or some only of the Notes then outstanding on any Optional Redemption Date and at the Optional Redemption Amount(s) specified in, or determined in the manner specified in, the applicable Pricing Supplement together, if appropriate, with interest accrued to (but excluding) the relevant Optional Redemption Date. Any such redemption must be of a nominal amount not less than the Minimum Redemption Amount and not more than the Maximum Redemption Amount, in each case as may be specified in the applicable Pricing Supplement. In the case of a partial redemption of Notes, the Notes to be redeemed (“Redeemed Notes”) will be selected individually by lot, in the case of Redeemed Notes represented by definitive Notes, and in accordance with the rules of Euroclear and/or Clearstream, Luxembourg, in the case of Redeemed Notes represented by a Global Note, not more than 30 days prior to the date fixed for redemption (such date of selection being hereinafter called the “Selection Date”). In the case of Redeemed Notes represented by definitive Notes, a list of the serial numbers of such Redeemed Notes will be published in accordance with Condition 15 not less than 15 days prior to the date fixed for redemption. The aggregate nominal amount of Redeemed Notes represented by definitive Notes shall bear the same proportion to the aggregate nominal amount of all Redeemed Notes as the aggregate nominal amount of definitive Notes outstanding bears to the aggregate nominal amount of the Notes outstanding, in each case on the Selection Date, provided that, such first mentioned nominal amount shall, if necessary, be rounded downwards to the nearest integral multiple of the Specified Denomination, and the aggregate nominal amount of Redeemed Notes represented by a Global Note shall be equal to the balance of the Redeemed Notes. No exchange of the relevant Global Note will be permitted during the period from (and including) the Selection Date to (and including) the date fixed for redemption pursuant to this paragraph (c) and notice to that effect shall be given by the Issuer to the Noteholders in accordance with Condition 15 at least five days prior to the Selection Date.

 

  (d) Redemption at the option of the Noteholders (Investor Put)

If Investor Put is specified in the applicable Pricing Supplement, upon the holder of any Note giving to the Issuer in accordance with Condition 15 not less than 15 nor more than 30 days’ notice the Issuer will, upon the expiry of such notice, redeem, subject to, and in accordance with, the terms specified in the applicable Pricing Supplement, such Note on the Optional Redemption Date and at the Optional Redemption Amount together, if appropriate, with interest accrued to (but excluding) the Optional Redemption Date.

To exercise the right to require redemption of this Note the holder of this Note must deliver at the specified office of any Paying Agent at any time during normal business hours of such Paying Agent falling within the notice period, a duly completed and signed notice of exercise (which shall be irrevocable) in the form (for the time being current) obtainable from any specified office of any Paying Agent (a “Put Notice”) and in which the holder must specify a bank account (or,

 

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if payment is required to be made by cheque, an address) to which payment is to be made under this Condition 8. If this Note is in definitive form, the Put Notice must be accompanied by this Note or evidence satisfactory to the Paying Agent concerned that this Note will, following delivery of the Put Notice, be held to its order or under its control.

 

  (e) Early Redemption Amounts

For the purpose of paragraph (b) above and Condition 11, each Note will be redeemed at its Early Redemption Amount calculated as follows:

 

  (i) in the case of a Note with a Final Redemption Amount equal to the Issue Price, at the Final Redemption Amount thereof;

 

  (ii) in the case of a Note (other than a Zero Coupon Note but including an Instalment Note and a Partly Paid Note) with a Final Redemption Amount which is or may be less or greater than the Issue Price or which is payable in a Specified Currency other than that in which the Note is denominated, at the amount specified in, or determined in the manner specified in, the applicable Pricing Supplement or, if no such amount or manner is so specified in the applicable Pricing Supplement, at its nominal amount; or

 

  (iii) in the case of a Zero Coupon Note, at an amount (the “Amortised Face Amount”) calculated in accordance with the following formula:

Early Redemption Amount = RP x (1 + AY) y

where:

“RP” means the Reference Price; and

“AY” means the Accrual Yield expressed as a decimal;

“y” is a fraction the numerator of which is equal to the number of days (calculated on the basis of a 360-day year consisting of 12 months of 30 days each) from (and including) the Issue Date of the first Tranche of the Notes to (but excluding) the date fixed for redemption or (as the case may be) the date upon which such Note becomes due and repayable and the denominator of which is 360,

or on such other calculation basis as may be specified in the applicable Pricing Supplement.

 

  (f) Instalments

Instalment Notes will be redeemed in the Instalment Amounts and on the Instalment Dates. In the case of early redemption, the Early Redemption Amount will be determined pursuant to paragraph (e) above.

 

  (g) Partly Paid Notes

Partly Paid Notes will be redeemed, whether at maturity, early redemption or otherwise, in accordance with the provisions of this Condition and the applicable Pricing Supplement.

 

  (h) Purchases

The Issuer, the Guarantor or any Subsidiary of the Issuer or the Guarantor may at any time purchase Notes (provided that, in the case of definitive Notes, all unmatured Receipts, Coupons and Talons appertaining thereto are purchased therewith) at any price in the open market or otherwise. If purchases are made by tender, tenders must be available to all Noteholders alike. All Notes so purchased will be surrendered to a Paying Agent for cancellation.

 

  (i) Cancellation

All Notes which are redeemed will forthwith be cancelled (together with all unmatured Receipts, Coupons and Talons attached thereto or surrendered therewith at the time of redemption). All Notes so cancelled and the Notes purchased and cancelled pursuant to paragraph (h) above (together with all unmatured Receipts, Coupons and Talons cancelled therewith) shall be forwarded to the Agent and cannot be reissued or resold.

 

  (j) Late payment on Zero Coupon Notes

If the amount payable in respect of any Zero Coupon Note upon redemption of such Zero Coupon Note pursuant to paragraph (a), (b), (c) or (d) above or upon its becoming due and repayable as provided in Condition 11 is improperly withheld or refused, the amount due and repayable in respect of such Zero Coupon Note shall be the amount calculated as provided in paragraph (e)(iii)

 

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above as though the references therein to the date fixed for the redemption or the date upon which such Zero Coupon Note becomes due and payable were replaced by references to the date which is the earlier of:

 

  (i) the date on which all amounts due in respect of such Zero Coupon Note have been paid; and

 

  (ii) five days after the date on which the full amount of the moneys payable in respect of such Zero Coupon Notes has been received by the Agent or the Trustee and notice to that effect has been given to the Noteholders in accordance with Condition 15.

 

9 TAXATION

All payments of principal and interest in respect of the Notes, Receipts and Coupons by the Issuer or the Guarantor will be made without withholding or deduction for or on account of any present or future taxes or duties of whatever nature imposed or levied by or on behalf of any Tax Jurisdiction unless such withholding or deduction is required by law. In such event, the Issuer or, as the case may be, the Guarantor will pay such additional amounts as shall be necessary in order that the net amounts received by the holders of the Notes, Receipts or Coupons after such withholding or deduction shall equal the respective amounts of principal and interest which would otherwise have been receivable in respect of the Notes, Receipts or Coupons, as the case may be, in the absence of such withholding or deduction; except that no such additional amounts shall be payable with respect to any Note, Receipt or Coupon:

 

  (a) presented for payment in the United Kingdom; or

 

  (b) presented for payment by or on behalf of a holder who is liable for such taxes or duties in respect of such Note, Receipt or Coupon by reason of his having some connection with a Tax Jurisdiction other than the mere holding of such Note, Receipt or Coupon; or

 

  (c) presented for payment by, or by a third party on behalf of, a holder who would not be liable to such withholding or deduction if such holder had made a declaration of non-residence or similar claim for exemption to any authority or in any Tax Jurisdiction; or

 

  (d) presented for payment more than 30 days after the Relevant Date (as defined below) except to the extent that the holder thereof would have been entitled to an additional amount on presenting the same for payment on such thirtieth day assuming that day to have been a Payment Day (as defined in Condition 7(e)); or

 

  (e) where such withholding or deduction is imposed on a payment to an individual and is required to be made pursuant to any law implementing or complying with, or introduced in order to conform to, Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of 26th-27th November, 2000; or

 

  (f) presented for payment by or on behalf of a holder who would have been able to avoid such withholding or deduction by presenting the relevant Note, Receipt or Coupon to another Paying Agent in a Member State of the European Union.

In these Conditions, the following expressions shall have the following meanings:

 

  (i) “Tax Jurisdiction” means the United Kingdom or any political subdivision or any authority thereof or therein having power to tax; and

 

  (ii) the “Relevant Date” means the date on which such payment first becomes due, except that, if the full amount of the moneys payable has not been duly received by the Agent or the Trustee, as the case may be, on or prior to such due date, it means the date on which, the full amount of such moneys having been so received, notice to that effect is duly given to the Noteholders in accordance with Condition 15.

 

10 PRESCRIPTION

The Notes, Receipts and Coupons will become void unless presented for payment within a period of 10 years (in the case of principal) and five years (in the case of interest) after the Relevant Date (as defined in Condition 9) therefor.

There shall not be included in any Coupon sheet issued on exchange of a Talon any Coupon the claim for payment in respect of which would be void pursuant to this Condition or Condition 7(b) or any Talon which would be void pursuant to Condition 7(b).

 

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11 EVENTS OF DEFAULT

The Trustee at its discretion may, and if so requested in writing by the holders of at least one-fifth in nominal amount of the Notes then outstanding if so directed by an Extraordinary Resolution shall (subject in each case to being indemnified to its satisfaction), give notice to the Issuer that each Note is, and each Note shall thereupon forthwith become, immediately due and repayable at its Early Redemption Amount (as described in Condition 8(e)), together with accrued interest as provided in the Trust Deed, if any one or more of the following events (each an “Event of Default”) shall occur and be continuing:

 

  (i) if default is made in the payment of any principal or interest due in respect of the Notes or any of them and the default continues for a period of 7 days in the case of principal and 14 days in the case of interest; or

 

  (ii) if the Issuer or the Guarantor fails to perform or observe any of its other obligations under the Trust Deed and these Conditions and (except in any case where, in the opinion of the Trustee, the failure is incapable of remedy when no such continuation or notice as is hereinafter mentioned will be required) the failure continues for the period of 30 days next following the service by the Trustee on the Issuer or the Guarantor (as the case may be) of notice requiring the same to be remedied; or

 

  (iii) if: (i) any indebtedness (whether being principal, premium, interest or other amounts) for or in respect of any notes, bonds, debentures, debenture stock, loan stock or other securities or any borrowed money or any liability under or in respect of any acceptance or acceptance credit in any such case in an aggregate amount of £10,000,000 (or its equivalent in any other currency or currencies) (“Indebtedness for Borrowed Money”) of the Issuer or the Guarantor or any Material Subsidiary is declared due and repayable prematurely by reason of an event of default (however described); (ii) the Issuer, the Guarantor or any Material Subsidiary fails to make any payment in respect of any Indebtedness for Borrowed Money on the due date for payment or within any applicable grace period as originally provided; (iii) any security given by the Issuer, the Guarantor or any Material Subsidiary for any Indebtedness for Borrowed Money becomes enforceable; or (iv) default is made by the Issuer, the Guarantor or any Material Subsidiary in making any payment due under any guarantee and/or indemnity given by it in relation to any Indebtedness for Borrowed Money of any other person; or

 

  (iv) if any order is made by any competent court or resolution passed for the winding up or dissolution of the Issuer, the Guarantor or any Material Subsidiary, save, in the case of the Issuer or the Guarantor or a Material Subsidiary, for the purposes of a reorganisation of a members’ solvent voluntary winding-up on terms approved by the Trustee; or

 

  (v) if the Issuer, the Guarantor or any Material Subsidiary ceases or threatens to cease to carry on the whole or a substantial part of its business, save for the purposes of reorganisation on terms approved by the Trustee, or the Issuer, the Guarantor or any Material Subsidiary stops or threatens to stop payment of, or is unable to, or admits inability to, pay its debts (or any class of its debts) as they fall due, or is deemed unable to pay its debts within the meaning of section 123(2) of the Insolvency Act 1986; or

 

  (vi) if (A) proceedings are initiated against the Issuer, the Guarantor or any Material Subsidiary under any applicable liquidation, insolvency, composition, reorganisation or other similar laws, or an application is made for the appointment of an administrative or other receiver, manager, administrator or other similar official, or an administrative or other receiver, manager, administrator or other similar official is appointed, in relation to the Issuer, the Guarantor or any Material Subsidiary or, as the case may be, in relation to the whole or a substantial part of the undertaking or assets of any of them, or an encumbrancer takes possession of the whole or a substantial part of the undertaking or assets of any of them, or a distress, execution, attachment, sequestration or other process is levied, enforced upon, sued out or put in force against the whole or a substantial part of the undertaking or assets of any of them and (B) in any case (other than the appointment of an administrator) is not discharged within 30 days; or

 

  (vii)

if the Issuer, the Guarantor or any Material Subsidiary initiates or consents to judicial proceedings relating to itself under any applicable liquidation, insolvency, composition, reorganisation or other similar laws or makes a conveyance or assignment for the benefit of,

 

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or enters into any composition or other arrangement with, its creditors generally (or any class of its creditors) or any meeting is convened to consider a proposal for an arrangement or composition with its creditors generally (or any class of its creditors); or

 

  (viii) if the Guarantee ceases to be, or is claimed by the Issuer or the Guarantor not to be, in full force or effect,

provided, in the case of any Event of Default other than those described in paragraphs (i), (iii) and (iv) above, that the Trustee shall have certified to the Issuer and the Guarantor that the Event of Default is, in its opinion, materially prejudicial to the interests of the Noteholders. Such certificate shall be binding on the Issuer, the Guarantor, the Noteholders, the Receiptholders and the Couponholders.

For the purposes of these Conditions, “Material Subsidiary” means, at any time, any Subsidiary of the Guarantor (excluding the Issuer):

 

  (a) whose total assets (consolidated in the case of a Subsidiary which itself has a Subsidiary) represent not less than 15 per cent. of the total assets of the Guarantor’s group (as shown in the then latest audited consolidated financial statements of the Guarantor’s group); and/or

 

  (b) whose turnover (consolidated in the case of a Subsidiary which itself has a Subsidiary) represents not less than 5 per cent. of the consolidated turnover of the Guarantor’s group (as shown in the then latest audited consolidated financial statements of the Guarantor’s group); and/or

 

  (c) to which has been transferred (whether by one transaction or a series of transactions, whether related or not) the whole or substantially the whole of the assets of a Subsidiary which, immediately prior to such transactions or any such transaction, is a Material Subsidiary by virtue of paragraph (a) or (b) above,

all as more particularly defined in the Trust Deed.

The certificate or report of the Auditors (as defined in the Trust Deed) that, in their opinion, a Subsidiary of the Guarantor is or is not or was or was not at any particular time or throughout any specified period a Material Subsidiary may be relied upon by the Trustee without any further enquiry or evidence and, if relied upon by the Trustee, shall, in the absence of manifest or proven error, be conclusive and binding on all concerned.

 

12 REPLACEMENT OF NOTES, RECEIPTS, COUPONS AND TALONS

Should any Note, Receipt, Coupon or Talon be lost, stolen, mutilated, defaced or destroyed, it may be replaced at the specified office of the Agent or any other place approved by the Trustee upon payment by the claimant of such costs and expenses as may be incurred in connection therewith and on such terms as to evidence and indemnity as the Issuer may reasonably require. Mutilated or defaced Notes, Receipts, Coupons or Talons must be surrendered before replacements will be issued.

 

13 PAYING AGENTS

The names of the initial Paying Agents and their initial specified offices are set out below.

The Issuer and the Guarantor are entitled, with the prior written approval of the Trustee, to vary or terminate the appointment of any Paying Agent and/or appoint additional or other Paying Agents and/or approve any change in the specified office through which any Paying Agent acts, provided that:

 

  (a) there will at all times be an Agent;

 

  (b) so long as the Notes are listed on any stock exchange, there will at all times be a Paying Agent with a specified office in such place as may be required by the rules and regulations of the relevant stock exchange (or any other relevant authority);

 

  (c) there will at all times be a Paying Agent in a jurisdiction within continental Europe (unless all Paying Agents within continental Europe are obliged to deduct or withhold tax from payments made); and

 

  (d)

if any law implementing or complying with, or introduced in order to conform to, Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of 26th-27th November, 2000 is introduced, the Issuer will ensure that it maintains a Paying Agent in a Member State of the European Union that will not be obliged to withhold or deduct tax pursuant to any such Directive or law (other than the United Kingdom unless (i) the United Kingdom is the only Member State of the European Union that will not be so obliged and (ii) there is then no United Kingdom obligation to withhold or deduct tax from

 

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payments of principal or interest in respect of the Notes, Receipts or Coupons (provided that in the event that such withholding or deduction is subsequently imposed the Issuer will be obliged to operate the provisions of this Condition 13(d) once again prior to the date of such imposition)), provided that this Condition 13(d) shall not apply if all Member States of the European Union will be so obliged.

In addition, the Issuer and the Guarantor shall forthwith appoint a Paying Agent having a specified office in New York City in the circumstances described in Condition 7(d). Any variation, termination, appointment or change shall only take effect (other than in the case of insolvency, when it shall be of immediate effect) after not less than 30 nor more than 45 days’ prior notice thereof shall have been given to the Noteholders in accordance with Condition 15.

In acting under the Agency Agreement, the Paying Agents act solely as agents of the Issuer and the Guarantor and, in certain circumstances set out therein, of the Trustee and do not assume any obligation to, or relationship of agency or trust with, any Noteholders, Receiptholders or Couponholders. The Agency Agreement contains provisions permitting any entity into which any Paying Agent is merged or converted or with which it is consolidated or to which it transfers all or substantially all of its assets to become the successor agent.

 

14 EXCHANGE OF TALONS

On and after the Interest Payment Date on which the final Coupon comprised in any Coupon sheet matures, the Talon (if any) forming part of such Coupon sheet may be surrendered at the specified office of the Agent or any other Paying Agent in exchange for a further Coupon sheet including (if such further Coupon sheet does not include Coupons to (and including) the final date for the payment of interest due in respect of the Note to which it appertains) a further Talon, subject to the provisions of Condition 10.

 

15 NOTICES

All notices regarding the Notes will be deemed to be validly given if published in a leading English language daily newspaper of general circulation in London. It is expected that such publication will be made in the Financial Times. The Issuer shall also ensure that notices are duly published in a manner which complies with the rules of any stock exchange or any other relevant authority on which the Notes are for the time being listed or by which they have been admitted to listing. Any such notice will be deemed to have been given on the date of the first publication or, where required to be published in more than one newspaper, on the date of the first publication in all required newspapers. If publication as provided above is not practicable, notice will be given in such other manner, and will be deemed to have been given on such date, as the Trustee shall approve.

Until such time as any definitive Notes are issued, there may, so long as any Global Notes representing the Notes are held in their entirety on behalf of Euroclear and/or Clearstream, Luxembourg, be substituted for such publication in such newspaper(s) the delivery of the relevant notice to Euroclear and/or Clearstream, Luxembourg for communication by them to the holders of the Notes and, in addition, for so long as any Notes are listed on a stock exchange or admitted to listing by any other relevant authority and the rules of that stock exchange or other relevant authority so require, such notice will be published in a daily newspaper of general circulation in the place or places required by those rules. Any such notice shall be deemed to have been given to the holders of the Notes on the seventh day after the day on which the said notice was given to Euroclear and/or Clearstream, Luxembourg.

Notices to be given by any Noteholder shall be in writing and given by lodging the same, together (in the case of any Note in definitive form) with the relative Note or Notes, with the Agent. Whilst any of the Notes are represented by a Global Note, such notice may be given by any holder of a Note to the Agent through Euroclear and/or Clearstream, Luxembourg, as the case may be, in such manner as the Agent and Euroclear and/or Clearstream, Luxembourg, as the case may be, may approve for this purpose.

 

16 MEETINGS OF NOTEHOLDERS, MODIFICATION, WAIVER AND SUBSTITUTION

The Trust Deed contains provisions for convening meetings of the Noteholders to consider any matter affecting their interests, including the sanctioning by Extraordinary Resolution of a modification of the Notes, the Receipts, the Coupons or the Trust Deed. Such a meeting may be convened by the Issuer, the Guarantor or the Trustee and shall be convened by the Issuer upon request by Noteholders holding not less than five per cent. in nominal amount of the Notes for the time being remaining outstanding.

 

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The quorum at any such meeting for passing an Extraordinary Resolution is one or more persons holding or representing more than 50 per cent. in nominal amount of the Notes for the time being outstanding, or at any adjourned meeting one or more persons being or representing Noteholders whatever the nominal amount of the Notes so held or represented, except that at any meeting the business of which includes the modification of certain provisions of the Notes, the Receipts, the Coupons or the Trust Deed (including modifying the date of maturity of the Notes or any date for payment of interest thereon, reducing or cancelling the amount of principal or the rate of interest payable in respect of the Notes or altering the currency of payment of the Notes, the Receipts or the Coupons), the quorum shall be one or more persons holding or representing not less than two-thirds in nominal amount of the Notes for the time being outstanding, or at any adjourned such meeting one or more persons holding or representing not less than one-third in nominal amount of the Notes for the time being outstanding. An Extraordinary Resolution passed at any meeting of the Noteholders shall be binding on all the Noteholders, whether or not they are present at the meeting, and on all Receiptholders and Couponholders.

The Trustee and the Issuer may agree, without the consent of the Noteholders, Receiptholders or Couponholders, to:

 

  (a) any modification of the Notes, the Receipts, the Coupons or the Trust Deed which is not, in the opinion of the Trustee, materially prejudicial to the interests of the Noteholders; or

 

  (b) any modification of the Notes, the Receipts, the Coupons or the Trust Deed which is of a formal, minor or technical nature or is made to correct a manifest or proven error or to comply with mandatory provisions of the law.

Any such modification shall be binding on the Noteholders, the Receiptholders and the Couponholders and, unless the Trustee agrees otherwise, any such modification shall be notified to the Noteholders in accordance with Condition 15 as soon as practicable thereafter.

In connection with the exercise by it of any of its trusts, powers, authorities or discretions (including, without limitation, any modification, wavier or authorisation), the Trustee shall have regard to the general interests of the Noteholders as a class but shall not have regard to any interests arising from circumstances particular to individual Noteholders, Receiptholders or Couponholders (whatever their number) and, in particular but without limitation, shall not have regard to the consequences of the exercise of its trusts, powers, authorities or discretions for individual Noteholders, Receiptholders or Couponholders (whatever their number) resulting from their being for any purpose domiciled or resident in, or otherwise connected with, or subject to the jurisdiction of, any particular territory and the Trustee shall not be entitled to require, nor shall any Noteholder, Receiptholder or Couponholder be entitled to claim, from the Issuer, the Guarantor, the Trustee or any other person any indemnification or payment in respect of any tax consequence of any such exercise upon individual Noteholders, Receiptholders or Couponholders except to the extent already provided for in Condition 9 and/or any undertaking given in addition to, or in substitution for, Condition 9 pursuant to the Trust Deed.

The Trustee may, without the consent of the Noteholders, agree with the Issuer to the substitution in place of the Issuer (or of any previous substitute under this Condition) as the principal debtor under the Notes, Receipts, Coupons and the Trust Deed of another company, being a Subsidiary of the Issuer, or the Guarantor, subject to the Trustee being satisfied that the interests of the Noteholders will not be materially prejudiced by the substitution and certain other conditions set out in the Trust Deed being complied with.

 

17 INDEMNIFICATION OF THE TRUSTEE; ITS CONTRACTING WITH THE ISSUER AND/OR THE GUARANTOR AND ENFORCEMENT

The Trust Deed contains provisions for the indemnification of the Trustee and for its relief from responsibility, including provisions relieving it from taking action unless indemnified to its satisfaction.

The Trust Deed also contains provisions pursuant to which the Trustee is entitled, inter alia , (i) to enter into business transactions with the Issuer, the Guarantor and/or any of their respective Subsidiaries and to act as trustee for the holders of any other securities issued or guaranteed by the Issuer, the Guarantor and/or any of their respective Subsidiaries, (ii) to exercise and enforce its rights, comply with its obligations and perform its duties under or in relation to any such transactions or, as the case may be, any such trusteeship without regard to the interests of the Noteholders, Receiptholders or Couponholders, and (iii) to retain and not be liable to account for any profit made or any other amount or benefit received thereby or in connection therewith.

 

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The Trustee may at any time, at its discretion and without notice, take such proceedings against the Issuer and/or the Guarantor as it may think fit to enforce the provisions of the Trust Deed, the Notes and the Coupons, but it shall not be bound to take any such proceedings or any other action in relation to the Trust Deed, the Notes, the Receipts or the Coupons unless (a) it shall have been so directed by an Extraordinary Resolution of the Noteholders or so requested in writing by the holders of at least one-fifth in nominal amount of the Notes then outstanding and (b) it shall have been indemnified to its satisfaction.

No Noteholder, Receiptholder or Couponholder shall be entitled to proceed directly against the Issuer and/or the Guarantor unless the Trustee, having become bound so to proceed, fails to do so within a reasonable period and the failure shall be continuing.

 

18 FURTHER ISSUES

The Issuer shall be at liberty from time to time without the consent of the Noteholders, the Receiptholders or the Couponholders to create and issue further notes having terms and conditions the same as the Notes or the same in all respects save for the amount and date of the first payment of interest thereon and so that the same shall be consolidated and form a single Series with the outstanding Notes.

 

19 CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

No rights are conferred on any person under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of the Notes, but this does not affect any right or remedy of any person which exists or is available apart from that Act.

 

20 GOVERNING LAW

The Trust Deed, the Agency Agreement, the Notes, the Receipts and the Coupons are governed by, and shall be construed in accordance with, English law.

 

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AGENT

The Bank of New York, London Branch

One Canada Square

London E14 5AL

OTHER PAYING AGENT

The Bank of New York (Luxembourg) SA

Aerogolf Centre

1A, Hoehenhof

L-1736 Senningerberg

Luxembourg

 

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SCHEDULE 2

FORMS OF GLOBAL AND DEFINITIVE NOTES, RECEIPTS, COUPONS AND TALONS

PART 1

FORM OF TEMPORARY GLOBAL NOTE

[ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.]

TOMKINS FINANCE PLC

(the Issuer)

(incorporated with limited liability under the laws of England and Wales)

unconditionally and irrevocably guaranteed by

TOMKINS PLC

(the Guarantor)

(incorporated with limited liability under the laws of England and Wales)

TEMPORARY GLOBAL NOTE

This Note is a Temporary Global Note in respect of a duly authorised issue of Notes of the Issuer (the Notes) of the Nominal Amount, Specified Currency(ies) and Specified Denomination(s) as are specified in the Pricing Supplement applicable to the Notes (the Pricing Supplement), a copy of which is annexed hereto. References herein to the Conditions shall be to the Terms and Conditions of the Notes as set out in the First Schedule to the Trust Deed (as defined below) as supplemented, replaced and modified by the Pricing Supplement but, in the event of any conflict between the provisions of the said Conditions and the information in the Pricing Supplement, the Pricing Supplement will prevail.

Words and expressions defined in the Conditions shall bear the same meanings when used in this Global Note.

This Global Note is issued subject to, and with the benefit of, the Conditions and a Trust Deed (such Trust Deed as modified and/or supplemented and/or restated from time to time, the Trust Deed) dated 26th October, 2001 and made between the Issuer, the Guarantor and The Law Debenture Trust Corporation p.l.c. as trustee for the holders of the Notes.

For value received, the Issuer, subject as hereinafter provided and subject to and in accordance with the Conditions and the Trust Deed, promises to pay to the bearer hereof on each Instalment Date (if the Notes are repayable in instalments) and on the Maturity Date and/or on such earlier date(s) as all or any of the Notes represented by this Global Note may become due and repayable in accordance with the Conditions and the Trust Deed, the amount payable under the Conditions in respect of such Notes on each such date and to pay interest (if any) on the nominal amount of the Notes from time to

 

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time represented by this Global Note calculated and payable as provided in the Conditions and the Trust Deed together with any other sums payable under the Conditions and the Trust Deed, upon presentation and, at maturity, surrender of this Global Note at the specified office of the Agent at One Canada Square, London E14 5AL, England or such other specified office as may be specified for this purpose in accordance with the Conditions or at the specified office of any of the other Paying Agents located outside the United States, its territories and possessions (except as provided in the Conditions) from time to time appointed by the Issuer in respect of the Notes.

On any redemption or payment of an instalment or interest being made in respect of, or purchase and cancellation of, any of the Notes represented by this Global Note details of such redemption, payment, purchase and cancellation (as the case may be) shall be entered by or on behalf of the Issuer in Schedule One hereto and the relevant space in Schedule One hereto recording any such redemption, payment, purchase and cancellation (as the case may be) shall be signed by or on behalf of the Issuer. Upon any such redemption, payment of an instalment, purchase and cancellation the nominal amount of this Global Note and the Notes represented by this Global Note shall be reduced by the nominal amount of such Notes so redeemed or purchased and cancelled or the amount of such instalment. The nominal amount from time to time of this Global Note and of the Notes represented by this Global Note following any such redemption, payment of an instalment, purchase and cancellation as aforesaid or any exchange as referred to below shall be the nominal amount most recently entered in the relevant column in Parts 2, 3 or 4 of Schedule One hereto or in Schedule Two hereto.

Payments of principal and interest (if any) due prior to the Exchange Date (as defined below) will only be made to the bearer hereof to the extent that there is presented to the Agent by Clearstream Banking, société anonyme (Clearstream, Luxembourg) or Euroclear Bank S.A./N.V. as operator of the Euroclear System (Euroclear) a certificate in or substantially in the form set out in Part 7 of Schedule 2 to the Trust Deed to the effect that it has received from or in respect of a person entitled to a particular nominal amount of the Notes represented by this Global Note (as shown by its records) a certificate in or substantially in the form of Certificate “A” as set out in Part 7 of Schedule 2 to the Trust Deed. The bearer of this Global Note will not (unless upon due presentation of this Global Note for exchange, delivery of the appropriate number of Definitive Notes (together, if applicable, with the Receipts, Coupons and Talons appertaining thereto in or substantially in the forms set out in Parts 3, 4, 5 and 6 of Schedule 2 to the Trust Deed) or, as the case may be, issue and delivery (or, as the case may be, endorsement) of the Permanent Global Note is improperly withheld or refused and such withholding or refusal is continuing at the relevant payment date) be entitled to receive any payment hereon due on or after the Exchange Date.

On or after the date (the Exchange Date) which is 40 days after the Issue Date, this Global Note may be exchanged (free of charge) in whole or in part for, as specified in the Pricing Supplement, either Definitive Notes and (if applicable) Receipts, Coupons and/or Talons (on the basis that all the appropriate details have been included on the face of such Definitive Notes and (if applicable) Receipts, Coupons and/or Talons and the relevant information supplementing, replacing or modifying the Conditions appearing in the Pricing Supplement has been endorsed on or attached to such Definitive Notes) or a Permanent Global Note in or substantially in the form set out in Part 2 of Schedule 2 to the Trust Deed (together with the Pricing Supplement attached thereto) upon notice being given by Euroclear and/or Clearstream, Luxembourg acting on the instructions of any holder of an interest in this Global Note and subject, in the case of Definitive Notes, to such notice period as is specified in the Pricing Supplement.

If Definitive Notes and (if applicable) Receipts, Coupons and/or Talons have already been issued in exchange for all the Notes represented for the time being by the Permanent Global Note, then this Global Note may only thereafter be exchanged for Definitive Notes and (if applicable) Receipts, Coupons and/or Talons pursuant to the terms hereof.

 

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Presentation of this Global Note for exchange shall be made by the bearer hereof on any day (other than a Saturday or Sunday) on which banks are open for business in England at the office of the Agent specified above. The Issuer shall procure that Definitive Notes or (as the case may be) the Permanent Global Note shall be so issued and delivered in exchange for only that portion of this Global Note in respect of which there shall have been presented to the Agent by Euroclear or Clearstream, Luxembourg a certificate in or substantially in the form set out in Part 7 of Schedule 2 to the Trust Deed to the effect that it has received from or in respect of a person entitled to a particular nominal amount of the Notes represented by this Global Note (as shown by its records) a certificate in or substantially in the form of Certificate “A” as set out in Part 7 of Schedule 2 to the Trust Deed.

On an exchange of the whole of this Global Note, this Global Note shall be surrendered to the Agent. On an exchange of part only of this Global Note, details of such exchange shall be entered by or on behalf of the Issuer in Schedule Two hereto and the relevant space in Schedule Two hereto recording such exchange shall be signed by or on behalf of the Issuer, whereupon the nominal amount of this Global Note and the Notes represented by this Global Note shall be reduced by the nominal amount of this Global Note so exchanged. On any exchange of this Global Note for a Permanent Global Note, details of such exchange shall be entered by or on behalf of the Issuer in Schedule Two to the Permanent Global Note and the relevant space in Schedule Two thereto recording such exchange shall be signed by or on behalf of the Issuer.

Until the exchange of the whole of this Global Note as aforesaid, the bearer hereof shall (subject as provided in the next paragraph) in all respects (except as otherwise provided herein) be entitled to the same benefits as if he were the bearer of Definitive Notes and the relative Receipts, Coupons and/or Talons (if any) in the form(s) set out in Parts 3, 4, 5 and 6 (as applicable) of Schedule 2 to the Trust Deed.

Each person (other than Euroclear or Clearstream, Luxembourg) who is for the time being shown in the records of Euroclear or Clearstream, Luxembourg as the holder of a particular nominal amount of the Notes represented by this Global Note (in which regard any certificate or other document issued by Euroclear or Clearstream, Luxembourg as to the nominal amount of such Notes standing to the account of any person shall be conclusive and binding for all purposes save in the case of manifest error) shall be treated by the Issuer, the Guarantor, the Trustee, the Agent and any other Paying Agent as the holder of such nominal amount of such Notes for all purposes other than with respect to the payment of principal and interest on such nominal amount of such Notes, the right to which shall be vested, as against the Issuer and the Guarantor, solely in the bearer of this Global Note in accordance with and subject to the terms of this Global Note and the Trust Deed.

This Global Note is governed by, and shall be construed in accordance with, English law.

A person who is not a party to this Global Note has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Global Note, but this does not affect any right or remedy of a third party which exists or is available apart from that Act.

This Global Note shall not be valid unless authenticated by The Bank of New York, London Branch, as Agent.

IN WITNESS whereof the Issuer has caused this Global Note to be signed manually or in facsimile by a person duly authorised on its behalf.

Issued as of [            ].

TOMKINS FINANCE PLC

 

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By:  

 

  Duly Authorised

Authenticated by

The Bank of New York, London Branch,

as Agent.

 

By:  

 

    Authorised Officer

 

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SCHEDULE ONE

PART 1

INTEREST PAYMENTS

 

Date made

    Interest Payment
Date		      Total amount of
interest payable		      Amount of
interest paid		      Confirmation of
payment by or on
behalf of the
Issuer		  
           
           
           
           
           

 

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PART 2

PAYMENT OF INSTALMENT AMOUNTS

 

Date made

    Total amount  of
Instalment
Amounts payable		      Amount of
Instalment
Amounts paid		      Remaining nominal
amount of this
Global Note
following such
payment *		      Confirmation of
payment by or on
behalf of the  Issuer		  
           
           
           
           
           

 

* See most recent entry in Parts 2, 3 or 4 of Schedule Two in order to determine this amount.

 

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PART 3

REDEMPTIONS

 

Date made

    Total amount of
principal payable		      Amount of
principal paid		      Remaining nominal
amount of this
Global Note
following such
redemption*		      Confirmation of
redemption by or
on behalf of the
Issuer		  
           
           
           
           
           

 

* See most recent entry in Parts 2, 3 or 4 of Schedule Two in order to determine this amount.

 

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PART 4

PURCHASES AND CANCELLATIONS

 

Date made

    Part of nominal amount of
this Global Note
purchased and cancelled		      Remaining nominal
amount of this Global Note
following such
purchase and cancellation*		      Confirmation of purchase
and cancellation by or on
behalf of the Issuer		  
        
        
        
        
        

 

* See most recent entry in Parts 2, 3 or 4 of Schedule Two in order to determine this amount.

 

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SCHEDULE TWO

EXCHANGES

FOR DEFINITIVE NOTES OR PERMANENT GLOBAL NOTE

The following exchanges of a part of this Global Note for Definitive Notes or a part of a Permanent Global Note have been made:

 

Date made

    Nominal amount of this
Global Note exchanged for
Definitive Notes or a part
of a Permanent Global Note		      Remaining nominal amount
of this Global Note
following such exchange *		      Notation made by or on
behalf of the Issuer		  
        
        
        
        
        

 

* See most recent entry in Parts 2, 3 or 4 of Schedule One or in this Schedule Two in order to determine this amount.

 

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SCHEDULE TWO

PART 2

FORM OF PERMANENT GLOBAL NOTE

[ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.]

TOMKINS FINANCE PLC (the Issuer)

(incorporated with limited liability under the laws of England and Wales)

unconditionally and irrevocably guaranteed by

TOMKINS PLC

(the Guarantor)

(incorporated with limited liability under the laws of England and Wales)

PERMANENT GLOBAL NOTE

This Note is a Permanent Global Note in respect of a duly authorised issue of Notes of the Issuer (the Notes) of the Nominal Amount, Specified Currency(ies) and Specified Denomination(s) as are specified in the Pricing Supplement applicable to the Notes (the Pricing Supplement), a copy of which is annexed hereto. References herein to the Conditions shall be to the Terms and Conditions of the Notes as set out in the First Schedule to the Trust Deed (as defined below) as supplemented, replaced and modified by the Pricing Supplement but, in the event of any conflict between the provisions of the said Conditions and the information in the Pricing Supplement, the Pricing Supplement will prevail.

Words and expressions defined in the Conditions shall bear the same meanings when used in this Global Note.

This Global Note is issued subject to, and with the benefit of, the Conditions and a Trust Deed (such Trust Deed as modified and/or supplemented and/or restated from time to time, the Trust Deed) dated 26th October, 2001 and made between the Issuer, the Guarantor and The Law Debenture Trust Corporation p.l.c. as trustee for the holders of the Notes.

For value received, the Issuer, subject to and in accordance with the Conditions and the Trust Deed, promises to pay to the bearer hereof on each Instalment Date (if the Notes are repayable in instalments) and on the Maturity Date and/or on such earlier date(s) as all or any of the Notes represented by this Global Note may become due and repayable in accordance with the Conditions and the Trust Deed, the amount payable under the Conditions in respect of such Notes on each such date and to pay interest (if any) on the nominal amount of the Notes from time to time represented by this Global Note calculated and payable as provided in the Conditions and the Trust Deed together with any other sums payable under the Conditions and the Trust Deed, upon presentation and, at

 

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maturity, surrender of this Global Note at the specified office of the Agent at One Canada Square, London E14 5AL, England or such other specified office as may be specified for this purpose in accordance with the Conditions or at the specified office of any of the other Paying Agents located outside the United States, its territories and possessions (except as provided in the Conditions) from time to time appointed by the Issuer in respect of the Notes.

On any redemption or payment of an instalment or interest being made in respect of, or purchase and cancellation of, any of the Notes represented by this Global Note details of such redemption, payment, purchase and cancellation (as the case may be) shall be entered by or on behalf of the Issuer in Schedule One hereto and the relevant space in Schedule One hereto recording any such redemption, payment, purchase and cancellation (as the case may be) shall be signed by or on behalf of the Issuer. Upon any such redemption, payment of an instalment, purchase and cancellation the nominal amount of this Global Note and the Notes represented by this Global Note shall be reduced by the nominal amount of such Notes so redeemed or purchased and cancelled or the amount of such instalment. The nominal amount from time to time of this Global Note and of the Notes represented by this Global Note following any such redemption, payment of an instalment, purchase and cancellation as aforesaid or any exchange as referred to below shall be the nominal amount most recently entered in the relevant column in Part 2, 3 or 4 of Schedule One hereto or in Schedule Two hereto.

Where TEFRA D is specified in the applicable Pricing Supplement, the Notes will initially have been represented by a Temporary Global Note. On any exchange of such Temporary Global Note issued in respect of the Notes for this Global Note or any part hereof, details of such exchange shall be entered by or on behalf of the Issuer in Schedule Two hereto and the relevant space in Schedule Two hereto recording such exchange shall be signed by or on behalf of the Issuer, whereupon the nominal amount of this Global Note and the Notes represented by this Global Note shall be increased by the nominal amount of the Temporary Global Note so exchanged.

This Global Note may be exchanged (free of charge) in whole, but not in part, for Definitive Notes and (if applicable) Receipts, Coupons and/or Talons in or substantially in the forms set out in Parts 3, 4, 5 and 6 of Schedule 2 to the Trust Deed (on the basis that all the appropriate details have been included on the face of such Definitive Notes and (if applicable) Receipts, Coupons and/or Talons and the relevant information supplementing, replacing or modifying the Conditions appearing in the Pricing Supplement has been endorsed on or attached to such Definitive Notes) either, as specified in the applicable Pricing Supplement:

 

  (a) upon not less than 60 days’ written notice being given to the Agent by Euroclear Bank S.A./N.V. as operator of the Euroclear System (Euroclear) and/or Clearstream Banking, société anonyme (Clearstream, Luxembourg) (acting on the instructions of any holder of an interest in this Global Note); or

 

  (b) upon the occurrence of an Exchange Event.

An Exchange Event means:

 

  (i) an Event of Default has occurred and is continuing;

 

  (ii) the Issuer has been notified that both Euroclear and Clearstream, Luxembourg have been closed for business for a continuous period of 14 days (other than by reason of holiday, statutory or otherwise) or have announced an intention permanently to cease business or have in fact done so and no successor clearing system satisfactory to the Trustee is available; or

 

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  (iii) the Issuer has or will become subject to adverse tax consequences which would not be suffered were the Notes in definitive form and a certificate to such effect from two Directors of the Issuer has been given to the Trustee.

If this Global Note is exchangeable following the occurrence of an Exchange Event:

 

  (a) the Issuer will promptly give notice to Noteholders in accordance with Condition 15 upon the occurrence of such Exchange Event; and

 

  (b) Euroclear and/or Clearstream, Luxembourg (acting on the instructions of any holder of an interest in this Global Note) or the Trustee may give notice to the Agent requesting exchange and, in the event of the occurrence of an Exchange Event as described in (b)(iii) above, the Issuer may also give notice to the Agent requesting exchange.

Any such exchange shall occur on a date specified in the notice not more than 45 days after the date of receipt of the first relevant notice by the Agent.

The first notice requesting exchange in accordance with the above provisions shall give rise to the issue of Definitive Notes for the total nominal amount of Notes represented by this Global Note.

Any such exchange as aforesaid will be made upon presentation of this Global Note by the bearer hereof on any day (other than a Saturday or Sunday) on which banks are open for business in England at the office of the Agent specified above.

The aggregate nominal amount of Definitive Notes issued upon an exchange of this Global Note will be equal to the aggregate nominal amount of this Global Note. Upon exchange of this Global Note for Definitive Notes, the Agent shall cancel it or procure that it is cancelled.

Until the exchange of the whole of this Global Note as aforesaid, the bearer hereof shall (subject as provided in the next paragraph) in all respects be entitled to the same benefits as if he were the bearer of Definitive Notes and the relative Receipts, Coupons and/or Talons (if any) in the form(s) set out in Parts 3, 4, 5 and 6 (as applicable) of Schedule 2 to the Trust Deed.

Each person (other than Euroclear or Clearstream, Luxembourg) who is for the time being shown in the records of Euroclear or Clearstream, Luxembourg as the holder of a particular nominal amount of the Notes represented by this Global Note (in which regard any certificate or other document issued by Euroclear or Clearstream, Luxembourg as to the nominal amount of such Notes standing to the account of any person shall be conclusive and binding for all purposes save in the case of manifest error) shall be treated by the Issuer, the Guarantor, the Trustee, the Agent and any other Paying Agent as the holder of such nominal amount of such Notes for all purposes other than with respect to the payment of principal and interest on such nominal amount of such Notes, the right to which shall be vested, as against the Issuer and the Guarantor, solely in the bearer of this Global Note in accordance with and subject to the terms of this Global Note and the Trust Deed.

This Global Note is governed by, and shall be construed in accordance with, English law.

A person who is not a party to this Global Note has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Global Note, but this does not affect any right or remedy of a third party which exists or is available apart from that Act.

 

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This Global Note shall not be valid unless authenticated by The Bank of New York, London Branch, as Agent.

IN WITNESS whereof the Issuer has caused this Global Note to be signed manually or in facsimile by a person duly authorised on its behalf.

Issued as of [            ].

 

TOMKINS FINANCE PLC

By:

  

 

  Duly Authorised

 

Authenticated by

The Bank of New York, London Branch,

as Agent.

By:

  

 

  Authorised Officer

 

72

 

 

SCHEDULE ONE

PART 1

INTEREST PAYMENTS

 

Date made

    Interest Payment
Date		      Total amount of
interest payable		      Amount of
interest paid		      Confirmation of
payment by or on
behalf of the
Issuer		  
           
           
           
           
           

 

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PART 2

PAYMENT OF INSTALMENT AMOUNTS

 

Date Made

    Total amount of
Instalment
Amounts payable		      Amount of
Instalment
Amounts paid		      Remaining nominal
amount of this
Global Note
following such
payment *		      Confirmation of
payment by or on behalf
of the Issuer		  
           
           
           
           
           

 

* See most recent entry in Parts 2, 3 or 4 of Schedule Two in order to determine this amount.

 

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PART 3

REDEMPTIONS

 

Date Made

    Total amount of
principal payable		      Amount of
Principal paid		      Remaining nominal
amount of this
Global Note
following such
redemption *		      Confirmation of
redemption by or on
behalf of the Issuer		  
           
           
           
           
           

 

* See most recent entry in Parts 2, 3 or 4 of Schedule Two in order to determine this amount.

 

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PART 4

PURCHASES AND CANCELLATIONS

 

Date Made

    Part of nominal amount of
this Global Note
purchased and cancelled		      Remaining nominal
amount of this Global
Note following such
purchase and cancellation *		      Confirmation of purchase
and cancellation by or on
behalf of the Issuer		  
        
        
        
        
        

 

* See most recent entry in Parts 2, 3 or 4 of Schedule Two in order to determine this amount.

 

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SCHEDULE TWO

EXCHANGES

 

Date made

    Nominal amount of
Temporary Bearer
Global Note exchanged
for this Global Note		      Increased nominal
amount of this Global
Note following such
exchange *		      Notation made by or on
behalf of the Issuer		  
        
        
        
        
        

 

* See most recent entry in Parts 2, 3 or 4 of Schedule One or in this Schedule Two in order to determine this amount.

 

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SCHEDULE 2

PART 3

FORM OF DEFINITIVE NOTE

[ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.]

TOMKINS FINANCE PLC

(the Issuer)

(incorporated with limited liability under the laws of England and Wales)

unconditionally and irrevocably guaranteed by

TOMKINS PLC

(the Guarantor)

[Specified Currency and Nominal Amount of Tranche]

NOTES DUE

[Year of Maturity]

This Note is one of a Series of Notes of [Specified Currency(ies) and Specified Denomination(s)] each of the Issuer (Notes). References herein to the Conditions shall be to the Terms and Conditions [endorsed hereon/set out in the First Schedule to the Trust Deed (as defined below) which shall be incorporated by reference herein and have effect as if set out herein] as supplemented, replaced and modified by the relevant information appearing in the Pricing Supplement (the Pricing Supplement) endorsed hereon but, in the event of any conflict between the provisions of the said Conditions and such information in the Pricing Supplement, such information will prevail.

Words and expressions defined in the Conditions shall bear the same meanings when used in this Note.

This Note is issued subject to, and with the benefit of, the Conditions and a Trust Deed (such Trust Deed as modified and/or supplemented and/or restated from time to time, the Trust Deed) dated 26th October, 2001 and made between the Issuer, the Guarantor and The Law Debenture Trust Corporation p.l.c. as trustee for the holders of the Notes.

For value received, the Issuer, subject to and in accordance with the Conditions and the Trust Deed, promises to pay to the bearer hereof on [each Instalment Date and] the Maturity Date or on such earlier date as this Note may become due and repayable in accordance with the Conditions and the Trust Deed, the amount payable on redemption of this Note and to pay interest (if any) on the nominal amount of this Note calculated and payable as provided in the Conditions and the Trust Deed together with any other sums payable under the Conditions and the Trust Deed.

This Note shall not be valid unless authenticated by The Bank of New York, London Branch, as Agent.

 

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IN WITNESS whereof this Note has been executed on behalf of the Issuer.

Issued as of [            ].

 

TOMKINS FINANCE PLC
By:  

 

  Duly Authorised

Authenticated by

The Bank of New York, London Branch,

as Agent.

 

By:  

 

  Authorised Officer

 

79

 

 

[CONDITIONS]

[Conditions to be as set out in Schedule 1 to this Trust Deed or such other form as may be agreed between the Issuer, the Agent, the Trustee and the relevant Dealer(s), but shall not be endorsed if not required by the relevant Stock Exchange.]

 

80

 

 

PRICING SUPPLEMENT

[Here to be set out the text of the relevant information supplementing, replacing or modifying the Conditions which appears in the Pricing Supplement relating to the Notes.]

 

81

 

 

SCHEDULE 2

PART 4

FORM OF RECEIPT

[Face of Receipt]

TOMKINS FINANCE PLC

[Specified Currency and Nominal Amount of Tranche]

NOTES DUE

[Year of Maturity]

Series No. [        ]

ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE 1

Receipt for the sum of [            ] being the instalment of principal payable in accordance with the Terms and Conditions applicable to the Note to which this Receipt appertains (the Conditions) on [            ].

This Receipt is issued subject to and in accordance with the Conditions which shall be binding upon the holder of this Receipt (whether or not it is for the time being attached to such Note) and is payable at the specified office of any of the Paying Agents set out on the reverse hereof (and/or any other or further Paying Agents and/or specified offices as may from time to time be duly appointed and notified to the Noteholders).

This Receipt must be presented for payment together with the Note to which it appertains. The Issuer shall have no obligation in respect of any Receipt presented without the Note to which it appertains or any unmatured Receipts.

 

1 

Delete where the original maturity of the Notes is 365 days or less.

 

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SCHEDULE 2

PART 5

FORM OF COUPON

[Face of Coupon]

TOMKINS FINANCE PLC

[Specified Currency and Nominal Amount of Tranche]

NOTES DUE

[Year of Maturity]

Series No. [        ]

[Coupon appertaining to a Note in the denomination of [Specified Currency and Specified Denomination]] 1

Part A

[For Fixed Rate Notes:

Coupon for [            ] due on [            ], [            ]]

This Coupon is payable to bearer, separately

negotiable and subject to the Terms and

Conditions of the said Notes.

Part B

[For Floating Rate Notes or Index Linked Interest Notes:

Coupon for the amount due in accordance with

the Terms and Conditions endorsed on,

attached to or incorporated by reference

into the said Notes on [the Interest Payment

Date falling in [    ] [    ]/[    ]].

This Coupon is payable to bearer, separately

negotiable and subject to such Terms and

Conditions, under which it may become void

before its due date.]

[ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.]*

 

1 

Delete where the Notes are all of the same denomination.

* Delete where the original maturity of the Notes is 365 days or less.

 

83

 

 

SCHEDULE 2

PART 6

FORM OF TALON

[Face of Talon]

TOMKINS FINANCE PLC

[Specified Currency and Nominal Amount of Tranche]

NOTES DUE

[Year of Maturity]

Series No. [    ]

[ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS, INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE.] 1

[Talon appertaining to a Note in the denomination of [Specified Currency and Specified Denomination]] 2

On and after [            ] further Coupons [and a further Talon] 3 appertaining to the Note to which this Talon appertains will be issued at the specified office of any of the Paying Agents set out on the reverse hereof (and/or any other or further Paying Agents and/or specified offices as may from time to time be duly appointed and notified to the Noteholders) upon production and surrender of this Talon.

This Talon may, in certain circumstances, become void under the Terms and Conditions endorsed on the Note to which this Talon appertains.

 

1 

Delete where the original maturity of the Notes is 365 days or less.

2 

Delete where the Notes are all of the same denomination.

3 

Not required on the last Coupon sheet.

 

84

 

 

[Reverse of Receipts, Coupons and Talons]

AGENT

The Bank of New York, London Branch

One Canada Square

London E14 5AL

OTHER PAYING AGENT

The Bank of New York (Luxembourg) SA

Aerogolf Centre

1A, Hoehenhof

L-1736 Senningerberg

Luxembourg

and/or such other or further principal paying agent or other Paying Agents and/or specified offices as may from time to time be duly appointed by the Issuer and notice of which has been given to the Noteholders.

 

85

 

 

SCHEDULE 2

PART 7

FORM OF CERTIFICATE TO BE PRESENTED BY EUROCLEAR OR CLEARSTREAM,

LUXEMBOURG

TOMKINS FINANCE PLC

[Title of Notes]

(the Securities)

This is to certify that, based solely on certifications we have received in writing, by tested telex or by electronic transmission from member organisations appearing in our records as persons being entitled to a portion of the nominal amount set forth below (our Member Organisations) substantially to the effect set forth in the temporary Global Note representing the Securities, as of the date hereof, [        ] nominal amount of the above-captioned Securities (a) is owned by persons that are not citizens or residents of the United States, domestic partnerships, domestic corporations or any estate all of the income of which is subject to United States Federal income taxation regardless of its source or trust if a court within the U.S. is able to exercise primary supervision over the administration of the trust, and one or more U.S. persons have authority to control all substantial decisions of the trust or a valid election is in effect under applicable U.S. Treasury Regulations for the trust to be treated as a U.S. person (United States persons), (b) is owned by United States persons that (i) are foreign branches of United States financial institutions (as defined in U.S. Treasury Regulations Sections 1.165-12(c)(1)(v)) (financial institutions) purchasing for their own account or for resale, or (ii) acquired the Securities through foreign branches of United States financial institutions and who hold the Securities through such United States financial institutions on the date hereof (and in either case (i) or (ii), each such United States financial institution has agreed, on its own behalf or through its agent, that we may advise the Issuer or the Issuer’s agent that it will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder), or (c) is owned by United States or foreign financial institutions for purposes of resale during the restricted period (as defined in U.S. Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)), and to the further effect that United States or foreign financial institutions described in Clause (c) above (whether or not also described in Clause (a) or (b)) have certified that they have not acquired the Securities for purposes of resale directly or indirectly to a United States person or to a person within the United States or its possessions.

If the Securities are of the category contemplated in Rule 903(b)(2) under the Securities Act of 1933, as amended, then this is also to certify with respect to such principal amount of Securities set forth above that, except as set forth below, we have received in writing, by tested telex or by electronic transmission, from our Member Organisations entitled to a portion of such principal amount, certifications with respect to such portion, substantially to the effect set forth in the temporary Global Note representing the Securities.

We further certify (a) that we are not making available herewith for exchange (or, if relevant, exercise of any rights or collection of any interest) any portion of the temporary Global Note excepted in such certifications and (b) that as of the date hereof we have not received any notification from any of our Member Organisations to the effect that the statements made by such Member Organisations with respect to any portion of the part submitted herewith for exchange (or, if relevant, exercise of any rights or collection of any interest) are no longer true and cannot be relied upon as of the date hereof.

 

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We understand that this certification is required in connection with certain tax laws and, if applicable, certain securities laws of the United States. In connection therewith, if administrative or legal proceedings or official enquiries are commenced or threatened in connection with which this certification is or would be relevant, we irrevocably authorise you to produce this certification to any interested party in such proceedings or enquiries.

Dated: 1

Yours faithfully,

[Euroclear Bank S.A./N.V.

as operator of the Euroclear

System]

or

 

[Clearstream Banking, société anonyme]
By:  

 

 

1 

To be dated no earlier than the date to which this certification relates, namely (a) the payment date or (b) the Exchange Date.

 

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CERTIFICATE “A”

TOMKINS FINANCE PLC

[Title of Notes]

(the Securities)

This is to certify that as of the date hereof, and except as set forth below, the above-captioned Securities held by you for our account (a) are owned by person(s) that are not citizens or residents of the United States, domestic partnerships, domestic corporations or any estate all of the income of which is subject to United States Federal income taxation regardless of its source or trust if a court within the U.S. is able to exercise primary supervision over the administration of the trust, and one or more U.S. persons have authority to control all substantial decisions of the trust or a valid election is in effect under applicable U.S. Treasury Regulations for the trust to be treated as a U.S. person (United States person(s)), (b) are owned by United States person(s) that (i) are foreign branches of United States financial institutions (as defined in U.S. Treasury Regulations Section 1.165-12(c)(1)(v)) (financial institutions) purchasing for their own account or for resale, or (ii) acquired the Securities through foreign branches of United States financial institutions and who hold the Securities through such United States financial institutions on the date hereof (and in either case (a) or (b), each such United States financial institution hereby agrees, on its own behalf or through its agent, that you may advise the Issuer or the Issuer’s agent that it will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder), or (c) are owned by United States or foreign financial institution(s) for purposes of resale during the restricted period (as defined in U.S. Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)), and in addition if the owner of the Securities is a United States or foreign financial institution described in Clause (c) above (whether or not also described in Clause (a) or (b)) this is to further certify that such financial institution has not acquired the Securities for purposes of resale directly or indirectly to a United States person or to a person within the United States or its possessions.

If the Securities are of the category contemplated in Rule 903(b)(2) under the Securities Act of 1933, as amended, (the Act) then this is also to certify that, except as set forth below, the Securities are beneficially owned by (a) non-U.S. person(s) or (b) U.S. person(s) who purchased the Securities in transactions which did not require registration under the Act. As used in this paragraph, the term “U.S. person” has the meaning given to it by Regulation S under the Act.

As used herein, United States means the United States of America (including the States and the District of Columbia); and its possessions include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands.

We undertake to advise you promptly by tested telex on or prior to the date on which you intend to submit your certification relating to the Securities held by you for our account in accordance with your operating procedures if any applicable statement herein is not correct on such date, and in the absence of any such notification it may be assumed that this certification applies as of such date.

This certification excepts and does not relate to [            ] of such interest in the above Securities in respect of which we are not able to certify and as to which we understand exchange and delivery of definitive Securities (or, if relevant, exercise of any right or collection of any interest) cannot be made until we do so certify.

 

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We understand that this certification is required in connection with certain tax laws and, if applicable, certain securities laws of the United States. In connection therewith, if administrative or legal proceedings or official enquiries are commenced or threatened in connection with which this certification is or would be relevant, we irrevocably authorise you to produce this certification to any interested party in such proceedings or enquiries.

 

Dated: 1

  
Name of person making certification  

 

By:  

 

    

 

 

1 

To be dated no earlier than the fifteenth day prior to the date to which this certification relates, namely (a) the payment date or (b) the Exchange Date.

 

89

 

 

SCHEDULE 3

PROVISIONS FOR MEETINGS OF NOTEHOLDERS

 

1. 1.1 As used in this Schedule the following expressions shall have the following meanings unless the context otherwise requires:

 

  (a) voting certificate shall mean an English language certificate issued by a Paying Agent and dated in which it is stated:

 

  (i) that on the date thereof Notes (whether in definitive form or represented by a Global Note and not being Notes in respect of which a block voting instruction has been issued and is outstanding in respect of the meeting specified in such voting certificate or any adjourned such meeting) were deposited with such Paying Agent or (to the satisfaction of such Paying Agent) were held to its order or under its control or blocked in an account with a clearing system and that no such Notes will cease to be so deposited or held or blocked until the first to occur of:

 

  (A) the conclusion of the meeting specified in such certificate or, if later, of any adjourned such meeting; and

 

  (B) the surrender of the certificate to the Paying Agent who issued the same; and

 

  (ii) that the bearer thereof is entitled to attend and vote at such meeting and any adjourned such meeting in respect of the Notes represented by such certificate;

 

  (b) block voting instruction shall mean an English language document issued by a Paying Agent and dated in which:

 

  (i) it is certified that Notes (whether in definitive form or represented by a Global Note and not being Notes in respect of which a voting certificate has been issued and is outstanding in respect of the meeting specified in such block voting instruction and any adjourned such meeting) have been deposited with such Paying Agent or (to the satisfaction of such Paying Agent) were held to its order or under its control or blocked in an account with a clearing system and that no such Notes will cease to be so deposited or held or blocked until the first to occur of:

 

  (A) the conclusion of the meeting specified in such document or, if later, of any adjourned such meeting; and

 

  (B)

the surrender to the Paying Agent not less than 48 hours before the time for which such meeting or any adjourned such meeting is convened of the receipt issued by such Paying Agent in respect of each such deposited Note which is to be released or (as the case may require) the Note or Notes ceasing with the agreement of the Paying

 

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Agent to be held to its order or under its control or so blocked and the giving of notice by the Paying Agent to the Issuer in accordance with paragraph 17 hereof of the necessary amendment to the block voting instruction;

 

  (ii) it is certified that each holder of such Notes has instructed such Paying Agent that the vote(s) attributable to the Note or Notes so deposited or held or blocked should be cast in a particular way in relation to the resolution or resolutions to be put to such meeting or any adjourned such meeting and that all such instructions are during the period commencing 48 hours prior to the time for which such meeting or any adjourned such meeting is convened and ending at the conclusion or adjournment thereof neither revocable nor capable of amendment;

 

  (iii) the aggregate principal amount of the Notes so deposited or held or blocked are listed distinguishing with regard to each such resolution between those in respect of which instructions have been given as aforesaid that the votes attributable thereto should be cast in favour of the resolution and those in respect of which instructions have been so given that the votes attributable thereto should be cast against the resolution; and

 

  (iv) one or more persons named in such document (each hereinafter called a proxy) is or are authorised and instructed by such Paying Agent to cast the votes attributable to the Notes so listed in accordance with the instructions referred to in (iii) above as set out in such document;

 

  (c) 24 hours shall mean a period of 24 hours including all or part of a day upon which banks are open for business in both the place where the relevant meeting is to be held and in each of the places where the Paying Agents have their specified offices (disregarding for this purpose the day upon which such meeting is to be held) and such period shall be extended by one period or, to the extent necessary, more periods of 24 hours until there is included as aforesaid all or part of a day upon which banks are open for business in all of the places as aforesaid; and

 

  (d) 48 hours shall mean a period of 48 hours including all or part of two days upon which banks are open for business both in the place where the relevant meeting is to be held and in each of the places where the Paying Agents have their specified offices (disregarding for this purpose the day upon which such meeting is to be held) and such period shall be extended by one period or, to the extent necessary, more periods of 24 hours until there is included as aforesaid all or part of two days upon which banks are open for business in all of the places as aforesaid.

 

  1.2

A holder of a Note (whether in definitive form or represented by a Global Note) may obtain a voting certificate in respect of such Note from a Paying Agent or require a Paying Agent to issue a block voting instruction in respect of such Note by depositing such Note with such Paying Agent or (to the satisfaction of such Paying Agent) by such Note being held to its order or under its control or being blocked in an account with a clearing system, in each case not less than 48 hours before the time fixed for the relevant meeting and on the terms set out in sub-paragraph 1.1(a)(i) or 1.1(b)(i) above (as the case may be), and (in the case of a block voting instruction) instructing such Paying Agent to the effect set out in sub-paragraph 1.1(b)(ii) above. The holder of any voting certificate or the proxies named in any block voting

 

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instruction shall for all purposes in connection with the relevant meeting or adjourned meeting of Noteholders be deemed to be the holder of the Notes to which such voting certificate or block voting instruction relates and the Paying Agent with which such Notes have been deposited or the person holding the same to the order or under the control of such Paying Agent or the clearing system in which such Notes have been blocked shall be deemed for such purposes not to be the holder of those Notes.

 

2. The Issuer, the Guarantor or the Trustee may at any time and the Issuer shall upon a requisition in writing in the English language signed by the holders of not less than one-tenth in nominal amount of the Notes for the time being outstanding convene a meeting of the Noteholders and if the Issuer makes default for a period of seven days in convening such a meeting the same may be convened by the Trustee or the requisitionists. Every such meeting shall be held at such time and place as the Trustee may appoint or approve.

 

3. At least 21 days’ notice (exclusive of the day on which the notice is given and the day on which the meeting is to be held) specifying the place, day and hour of meeting shall be given to the holders of the relevant Notes prior to any meeting of such holders in the manner provided by Condition 15. Such notice, which shall be in the English language, shall state generally the nature of the business to be transacted at the meeting thereby convened but (except for an Extraordinary Resolution) it shall not be necessary to specify in such notice the terms of any resolution to be proposed. Such notice shall include statements, if applicable, to the effect that Notes may, not less than 48 hours before the time fixed for the meeting, be deposited with Paying Agents or (to their satisfaction) held to their order or under their control or blocked in an account with a clearing system for the purpose of obtaining voting certificates or appointing proxies. A copy of the notice shall be sent by post to the Trustee (unless the meeting is convened by the Trustee), to the Issuer (unless the meeting is convened by the Issuer) and to the Guarantor (unless the meeting is convened by the Guarantor).

 

4. A person (who may but need not be a Noteholder) nominated in writing by the Trustee shall be entitled to take the chair at the relevant meeting or adjourned meeting but if no such nomination is made or if at any meeting or adjourned meeting the person nominated shall not be present within 15 minutes after the time appointed for holding the meeting or adjourned meeting the Noteholders present shall choose one of their number to be Chairman, failing which the Issuer may appoint a Chairman. The Chairman of an adjourned meeting need not be the same person as was Chairman of the meeting from which the adjournment took place.

 

5. At any such meeting one or more persons present holding Definitive Notes or voting certificates or being proxies or representatives and holding or representing in the aggregate not less than one-tenth of the nominal amount of the Notes for the time being outstanding shall (except for the purpose of passing an Extraordinary Resolution) form a quorum for the transaction of business and no business (other than the choosing of a Chairman) shall be transacted at any meeting unless the requisite quorum be present at the commencement of the relevant business. The quorum at any such meeting for passing an Extraordinary Resolution shall (subject as provided below) be one or more persons present holding Definitive Notes or voting certificates or being proxies or representatives and holding or representing in the aggregate a clear majority in nominal amount of the Notes for the time being outstanding PROVIDED THAT at any meeting the business of which includes any of the following matters (each of which shall, subject only to Clause 19.2, only be capable of being effected after having been approved by Extraordinary Resolution) namely:

 

  (a) reduction or cancellation of the amount payable or, where applicable, modification, except where such modification is in the opinion of the Trustee bound to result in an increase, of the method of calculating the amount payable or modification of the date of payment or, where applicable, of the method of calculating the date of payment in respect of any principal or interest in respect of the Notes;

 

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  (b) alteration of the currency in which payments under the Notes, Receipts and Coupons are to be made;

 

  (c) alteration of the majority required to pass an Extraordinary Resolution;

 

  (d) the sanctioning of any such scheme or proposal as is described in paragraph 18.9 below; and

 

  (e) alteration of this proviso or the proviso to paragraph 6 below;

the quorum shall be one or more persons present holding Definitive Notes or voting certificates or being proxies or representatives and holding or representing in the aggregate not less than two-thirds of the nominal amount of the Notes for the time being outstanding.

 

6. If within 15 minutes (or such longer period not exceeding 30 minutes as the Chairman may decide) after the time appointed for any such meeting a quorum is not present for the transaction of any particular business, then, subject and without prejudice to the transaction of the business (if any) for which a quorum is present, the meeting shall if convened upon the requisition of Noteholders be dissolved. In any other case it shall stand adjourned to the same day in the next week (or if such day is a public holiday the next succeeding business day) at the same time and place (except in the case of a meeting at which an Extraordinary Resolution is to be proposed in which case it shall stand adjourned for such period, being not less than 13 clear days nor more than 42 clear days, and to such place as may be appointed by the Chairman either at or subsequent to such meeting and approved by the Trustee). If within 15 minutes (or such longer period not exceeding 30 minutes as the Chairman may decide) after the time appointed for any adjourned meeting a quorum is not present for the transaction of any particular business, then, subject and without prejudice to the transaction of the business (if any) for which a quorum is present, the Chairman may either (with the approval of the Trustee) dissolve such meeting or adjourn the same for such period, being not less than 13 clear days (but without any maximum number of clear days), and to such place as may be appointed by the Chairman either at or subsequent to such adjourned meeting and approved by the Trustee, and the provisions of this sentence shall apply to all further adjourned such meetings. At any adjourned meeting one or more persons present holding Definitive Notes or voting certificates or being proxies or representatives (whatever the nominal amount of the Notes so held or represented by them) shall (subject as provided below) form a quorum and shall have power to pass any Extraordinary Resolution or other resolution and to decide upon all matters which could properly have been dealt with at the meeting from which the adjournment took place had the requisite quorum been present PROVIDED THAT at any adjourned meeting the quorum for the transaction of business comprising any of the matters specified in the proviso to paragraph 5 above shall be one or more persons present holding Definitive Notes or voting certificates or being proxies or representatives and holding or representing in the aggregate not less than one-third of the nominal amount of the Notes for the time being outstanding.

 

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7. Notice of any adjourned meeting at which an Extraordinary Resolution is to be submitted shall be given in the same manner as notice of an original meeting but as if 10 were substituted for 21 in paragraph 3 above and such notice shall state the relevant quorum. Subject as aforesaid it shall not be necessary to give any notice of an adjourned meeting.

 

8. Every question submitted to a meeting shall be decided in the first instance by a show of hands and in case of equality of votes the Chairman shall both on a show of hands and on a poll have a casting vote in addition to the vote or votes (if any) to which he may be entitled as a Noteholder or as a holder of a voting certificate or as a proxy or as a representative.

 

9. At any meeting unless a poll is (before or on the declaration of the result of the show of hands) demanded by the Chairman, the Issuer, the Trustee or any person present holding a Definitive Note or a voting certificate or being a proxy or representative (whatever the nominal amount of the Notes so held or represented by him) a declaration by the Chairman that a resolution has been carried or carried by a particular majority or lost or not carried by a particular majority shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against such resolution.

 

10. Subject to paragraph 12 below, if at any such meeting a poll is so demanded it shall be taken in such manner and subject as hereinafter provided either at once or after an adjournment as the Chairman directs and the result of such poll shall be deemed to be the resolution of the meeting at which the poll was demanded as at the date of the taking of the poll. The demand for a poll shall not prevent the continuance of the meeting for the transaction of any business other than the motion on which the poll has been demanded.

 

11. The Chairman may with the consent of (and shall if directed by) any such meeting adjourn the same from time to time and from place to place but no business shall be transacted at any adjourned meeting except business which might lawfully (but for lack of required quorum) have been transacted at the meeting from which the adjournment took place.

 

12. Any poll demanded at any such meeting on the election of a Chairman or on any question of adjournment shall be taken at the meeting without adjournment.

 

13. The Trustee and its lawyers and any director, officer or employee of a corporation being a trustee of these presents and any director or officer of the Issuer and its or their lawyers and any other person authorised so to do by the Trustee may attend and speak at any meeting. Save as aforesaid, but without prejudice to the proviso to the definition of “outstanding” in Clause 1, no person shall be entitled to attend and speak nor shall any person be entitled to vote at any meeting of Noteholders or join with others in requesting the convening of such a meeting or to exercise the rights conferred on Noteholders by Condition 11 unless he either produces the Definitive Note or Definitive Notes of which he is the holder or a voting certificate or is a proxy. No person shall be entitled to vote at any meeting in respect of Notes held by, for the benefit of, or on behalf of, the Issuer, the Guarantor, any Subsidiary of the Issuer or the Guarantor, any holding company of the Issuer or the Guarantor or any other Subsidiary of such holding company. Nothing herein shall prevent any of the proxies named in any block voting instructionfrom being a director, officer or representative of or otherwise connected with the Issuer or the Guarantor.

 

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14. Subject as provided in paragraph 13 hereof at any meeting:

 

  14.1 on a show of hands every person who is present in person and produces a Definitive Note or voting certificate or is a proxyshall have one vote; and

 

  14.2 on a poll every person who is so present shall have one vote in respect of each £1 or such other amount as the Trustee may in its absolute discretion stipulate (or, in the case of meetings of holders of Notes denominated in another currency, such amount in such other currency as the Trustee in its absolute discretion may stipulate) in nominal amount of the Definitive Notes so produced or represented by the voting certificate so produced or in respect of which he is a proxy or representative.

Without prejudice to the obligations of the proxies named in any block voting instruction any person entitled to more than one vote need not use all his votes or cast all the votes to which he is entitled in the same way.

 

15. The proxies named in any block voting instruction and representatives need not be Noteholders.

 

16. Each block voting instruction together (if so requested by the Trustee) with proof satisfactory to the Trustee of its due execution on behalf of the relevant Paying Agent shall be deposited by the relevant Paying Agent at such place as the Trustee shall approve not less than 24 hours before the time appointed for holding the meeting or adjourned meeting at which the proxies named in the block voting instruction propose to vote and in default the block voting instruction shall not be treated as valid unless the Chairman of the meeting decides otherwise before such meeting or adjourned meeting proceeds to business. A notarially certified copy of each block voting instructionshall (if the Trustee so requires) be deposited with the Trustee before the commencement of the meeting or adjourned meeting but the Trustee shall not thereby be obliged to investigate or be concerned with the validity of or the authority of the proxies named in any such block voting instruction.

 

17. Any vote given in accordance with the terms of a block voting instruction shall be valid notwithstanding the previous revocation or amendment of the block voting instruction or of any of the relevant Noteholders’ instructions pursuant to which it was executed provided that no intimation in writing of such revocation or amendment shall have been received from the relevant Paying Agent or in the case of a Registered Note from the holder thereof by the Issuer at its registered office (or such other place as may have been required or approved by the Trustee for the purpose) by the time being 24 hours and 48 hours respectively before the time appointed for holding the meeting or adjourned meeting at which the block voting instruction is to be used.

 

18. A meeting of the Noteholders shall in addition to the powers hereinbefore given have the following powers exercisable only by Extraordinary Resolution (subject to the provisions relating to quorum contained in paragraphs 5 and 6 above) namely:

 

  18.1 Power to sanction any compromise or arrangement proposed to be made between the Issuer, the Guarantor, the Trustee, any Appointee and the Noteholders, Receiptholders and Couponholders or any of them.

 

  18.2 Power to sanction any abrogation, modification, compromise or arrangement in respect of the rights of the Trustee, any Appointee, the Noteholders, the Receiptholders, Couponholders or the Issuer or the Guarantor or against any other or others of them or against any of their property whether such rights shall arise under these presents or otherwise.

 

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  18.3 Power to assent to any modification of the provisions of these presents which shall be proposed by the Issuer, the Guarantor, the Trustee or any Noteholder.

 

  18.4 Power to give any authority or sanction which under the provisions of these presents is required to be given by Extraordinary Resolution.

 

  18.5 Power to appoint any persons (whether Noteholders or not) as a committee or committees to represent the interests of the Noteholders and to confer upon such committee or committees any powers or discretions which the Noteholders could themselves exercise by Extraordinary Resolution.

 

  18.6 Power to approve of a person to be appointed a trustee and power to remove any trustee or trustees for the time being of these presents.

 

  18.7 Power to discharge or exonerate the Trustee and/or any Appointee from all liability in respect of any act or omission for which the Trustee and/or such Appointee may have become responsible under these presents.

 

  18.8 Power to authorise the Trustee and/or any Appointee to concur in and execute and do all such deeds, instruments, acts and things as may be necessary to carry out and give effect to any Extraordinary Resolution.

 

  18.9 Power to sanction any scheme or proposal for the exchange or sale of the Notes for or the conversion of the Notes into or the cancellation of the Notes in consideration of shares, stock, notes, bonds, debentures, debenture stock and/or other obligations and/or securities of the Issuer or any other company formed or to be formed, or for or into or in consideration of cash, or partly for or into or in consideration of such shares, stock, notes, bonds, debentures, debenture stock and/or other obligations and/or securities as aforesaid and partly for or into or in consideration of cash.

 

19. Any resolution passed at a meeting of the Noteholders duly convened and held in accordance with these presents shall be binding upon all the Noteholders whether present or not present at such meeting and whether or not voting and upon all Receiptholders and Couponholders and each of them shall be bound to give effect thereto accordingly and the passing of any such resolution shall be conclusive evidence that the circumstances justify the passing thereof. Notice of the result of the voting on any resolution duly considered by the Noteholders shall be published in accordance with Condition 15 by the Issuer within 14 days of such result being known PROVIDED THAT the non-publication of such notice shall not invalidate such result.

 

20. The expression Extraordinary Resolution when used in these presents means (a) a resolution passed at a meeting of the Noteholders duly convened and held in accordance with these presents by a majority consisting of not less than three-fourths of the persons voting thereat upon a show of hands or if a poll is duly demanded by a majority consisting of not less than three-fourths of the votes cast on such poll; or (b) a resolution in writing signed by or on behalf of all the Noteholders, which resolution in writing may be contained in one document or in several documents in like form each signed by or on behalf of one or more of the Noteholders.

 

21.

Minutes of all resolutions and proceedings at every meeting of the Noteholders shall be made and entered in books to be from time to time provided for that purpose by the Issuer and any

 

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such minutes as aforesaid if purporting to be signed by the Chairman of the meeting at which such resolutions were passed or proceedings transacted shall be conclusive evidence of the matters therein contained and until the contrary is proved every such meeting in respect of the proceedings of which minutes have been made shall be deemed to have been duly held and convened and all resolutions passed or proceedings transacted thereat to have been duly passed or transacted.

 

22. If and whenever the Issuer shall have issued and have outstanding Notes of more than one Series the foregoing provisions of this Schedule shall have effect subject to the following modifications:

 

22.1   (a)      a resolution which in the opinion of the Trustee affects the Notes of only one Series shall be deemed to have been duly passed if passed at a separate meeting of the holders of the Notes of that Series;

 

  (b) a resolution which in the opinion of the Trustee affects the Notes of more than one Series but does not give rise to a conflict of interest between the holders of Notes of any of the Series so affected shall be deemed to have been duly passed if passed at a single meeting of the holders of the Notes of all the Series so affected;

 

  (c) a resolution which in the opinion of the Trustee affects the Notes of more than one Series and gives or may give rise to a conflict of interest between the holders of the Notes of one Series or group of Series so affected and the holders of the Notes of another Series or group of Series so affected shall be deemed to have been duly passed only if passed at separate meetings of the holders of the Notes of each Series or group of Series so affected; and

 

  (d) to all such meetings all the preceding provisions of this Schedule shall mutatis mutandis apply as though references therein to Notes and Noteholders were references to the Notes of the Series or group of Series in question or to the holders of such Notes, as the case may be.

 

  22.2 If the Issuer shall have issued and have outstanding Notes which are not denominated in pounds sterling in the case of any meeting of holders of Notes of more than one currency the nominal amount of such Notes shall (a) for the purposes of paragraph 2 above be the equivalent in pounds sterling at the spot rate of a bank nominated by the Trustee for the conversion of the relevant currency or currencies into pounds sterling on the seventh dealing day prior to the day on which the requisition in writing is received by the Issuer and (b) for the purposes of paragraphs 5, 6 and 14 above (whether in respect of the meeting or any adjourned such meeting or any poll resulting therefrom) be the equivalent at such spot rate on the seventh dealing day prior to the day of such meeting. In such circumstances, on any poll each person present shall have one vote for each £1 (or such other pounds sterling amount as the Trustee may in its absolute discretion stipulate) in nominal amount of the Notes (converted as above) which he holds or represents.

 

23. Subject to all other provisions of these presents the Trustee may without the consent of the Issuer, the Guarantor, the Noteholders, the Receiptholders or the Couponholders prescribe such further regulations regarding the requisitioning and/or the holding of meetings of Noteholders and attendance and voting thereat as the Trustee may in its sole discretion think fit.

 

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EXECUTED as a deed by

TOMKINS FINANCE PLC acting by

   

)

)

    TOMKINS FINANCE PLC
   )   
and    )   
     

 

      Director
     

 

      Director/Secretary

EXECUTED as a deed by

TOMKINS PLC acting by

   

)

)

    TOMKINS PLC
                        and    )   
   )   
     

 

      Director
     

 

      Director/Secretary

THE COMMON SEAL of

THE LAW DEBENTURE TRUST

   

)

)

   
CORPORATION p.l.c.    )   
was affixed to this deed in    )   
the presence of:      
Director      
Authorised Signatory      

 

98

 

 

EXECUTED as a deed by

TOMKINS FINANCE PLC acting by

   

)

)

    TOMKINS FINANCE PLC
   )   
and    )   
     

 

      Director
     

 

      Director/Secretary

EXECUTED as a deed by

TOMKINS PLC acting by

   

)

)

    TOMKINS PLC
                        and    )   
   )   
     

 

      Director
     

 

      Director/Secretary

THE COMMON SEAL of

THE LAW DEBENTURE TRUST

   

)

)

   
CORPORATION p.l.c.    )   
was affixed to this deed    )   
in the presence of:      
Director      
Authorised Signatory      

 

3

 

 

DATED 26TH OCTOBER, 2001

TOMKINS FINANCE PLC

and

TOMKINS PLC

and

THE LAW DEBENTURE TRUST

CORPORATION p.l.c.

FOR TOMKINS FINANCE PLC AND TOMKINS

PLC

AS TO ENGLISH LAW:

SLAUGHTER AND MAY

ONE BUNHILL ROW

LONDON

EC1Y 8YY

FOR THE LAW DEBENTURE TRUST

CORPORATION P.L.C.

AS TO ENGLISH AND UNITED STATES LAW:

ALLEN & OVERY

ONE NEW CHANGE

LONDON

EC4M 9QQ

TRUST DEED

 

(as modified and restated on 28th August, 2003)

relating to a £750,000,000 Euro Medium Term Note

Programme

ALLEN & OVERY

London

 

 

DATED 28TH AUGUST, 2003

TOMKINS FINANCE PLC

and

TOMKINS PLC

and

THE LAW DEBENTURE TRUST

CORPORATION p.l.c.

FOR TOMKINS FINANCE PLC AND TOMKINS

PLC

AS TO ENGLISH LAW:

SLAUGHTER AND MAY

ONE BUNHILL ROW

LONDON

EC1Y 8YY

FOR THE LAW DEBENTURE TRUST

CORPORATION P.L.C.

AS TO ENGLISH AND UNITED STATES LAW:

ALLEN & OVERY

ONE NEW CHANGE

LONDON

EC4M 9QQ

THIRD SUPPLEMENTAL TRUST DEED

 

modifying and restating the provisions of the Trust

Deed dated 26th October, 2001 (as previously

modified and restated) relating to the £750,000,000

Euro Medium Term Note Programme

ALLEN & OVERY

London

EX-5.1 20 dex51.htm EXHIBIT 5.1 Exhibit 5.1

Exhibit 5.1

 

  

555 Eleventh Street, N.W., Suite 1000

Washington, D.C. 20004-1304

Tel: +1.202.637.2200 Fax: +1.202.637.2201

www.lw.com

 

FIRM / AFFILIATE OFFICES

LOGO   

Abu Dhabi

Barcelona

Beijing

Boston

Brussels

   

Moscow

Munich

New Jersey

New York

Orange County

   Chicago    Paris

 

June 24, 2011

 

Tomkins, Inc.

Tomkins, LLC

1511 Wewatta Street

Denver, Colorado 80202

   

Doha

Dubai

Frankfurt

Hamburg

Hong Kong

Houston

London

Los Angeles

Madrid

Milan

 

   

Riyadh

Rome

San Diego

San Francisco

Shanghai

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Singapore

Tokyo

Washington, D.C.

   File No. 049040-0003

 

  Re: Registration Statement No. 333-        ; $1,150,000,000 Aggregate Principal
     Amount of Senior Secured Second Lien Notes.

Ladies and Gentlemen:

We have acted as special counsel to Tomkins, LLC, a Delaware limited liability company (the “LLC Co-Issuer”) and Tomkins, Inc., a Delaware corporation (the “Corporate Co-Issuer,” and, together with the LLC Co-Issuer, the “Issuers”), in connection with the issuance of up to $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) and the guarantees of the Notes (the “Guarantees”) by the entities listed on Schedule I hereto (collectively, the “Delaware Corporate Guarantors”), the entities listed on Schedule II hereto (collectively, the “Delaware LLC Guarantors”), the entities listed on Schedule III hereto (collectively, the “Delaware LP Guarantors,” and together with the Delaware Corporate Guarantors and the Delaware LLC Guarantors, the “Delaware Guarantors”), the entity listed on Schedule IV hereto (the “California Guarantor”), the entities listed on Schedule V hereto (collectively, the “Texas Guarantors,” and together with the Delaware Guarantors and the California Guarantor, the “Covered Guarantors”), Pinafore Acquisitions Limited, a limited company incorporated under the laws of England and Wales (“Bidco”) and the entities listed on Schedule VI hereto (collectively, the “Other Guarantors,” and together with the Covered Guarantors and Bidco, the “Guarantors”), under an Indenture dated as of September 29, 2010, including the Guarantees, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011 (the “Fifth Supplemental Indenture), the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”) among the Issuers, the Guarantors and Wilmington Trust FSB, as trustee (in such capacity, the “Trustee”) and as collateral agent (in such capacity, the “Collateral Agent”), and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended (the “Act”), filed with the Securities and Exchange Commission (the “Commission”) on June 24, 2011 (Registration No. 333-        ) (the

June 24, 2011

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“Registration Statement”). The Notes and the Guarantees will be issued in exchange for the Company’s outstanding 9% Senior Notes due 2018 (the “Old Notes”), and the related guarantees, on the terms set forth in the prospectus (the “Prospectus”) contained in the Registration Statement and the letter of transmittal to be filed as an exhibit thereto.

This opinion is being furnished in connection with the requirements of Item 601(b)(5) of Regulation S-K under the Act, and no opinion is expressed herein as to any matter pertaining to the contents of the Registration Statement or related prospectus, other than as expressly stated herein with respect to the issue of the Notes and the Guarantees.

As such counsel, we have examined such matters of fact and questions of law as we have considered appropriate for purposes of this letter. With your consent, we have relied upon certificates and other assurances of officers of the Company, the Guarantors, and others as to factual matters without having independently verified such factual matters. We are opining herein as to the internal laws of the States of New York, California and Texas and the General Corporation Law of the State of Delaware, the Delaware Limited Liability Company Act and the Delaware Revised Uniform Limited Partnership Act, as applicable, and we express no opinion with respect to the applicability thereto, or the effect thereon, of the laws of any other jurisdiction or, in the case of Delaware, any other laws, or as to any matters of municipal law or the laws of any local agencies within any state. Various matters concerning the laws of the jurisdictions set forth on Schedule VII are addressed in the opinions of the counsel set forth on Schedule VII, which have been separately provided to you. We express no opinion with respect to those matters herein, and to the extent elements of those opinions are necessary to the conclusions expressed herein, we have, with your consent, assumed such matters.

Subject to the foregoing and the other matters set forth herein, it is our opinion that, as of the date hereof, when the Notes have been duly executed, issued, and authenticated in accordance with the terms of the Indenture and delivered against surrender of the Old Notes in the circumstances contemplated by the Indenture and the Registration Rights Agreement dated as of September 29, 2010 filed as an exhibit to the Registration Statement, the Notes and the Guarantees will have been duly authorized by all necessary corporate, limited liability company and limited partnership action, as applicable, of the Issuers and the Covered Guarantors, respectively, and will be legally valid and binding obligations of the Issuers and the Guarantors, respectively, enforceable against the Issuers and the Guarantors in accordance with their respective terms.

Our opinion is subject to: (i) the effect of bankruptcy, insolvency, reorganization, preference, fraudulent transfer, moratorium or other similar laws relating to or affecting the rights and remedies of creditors; (ii) the effect of general principles of equity, whether considered in a proceeding in equity or at law (including the possible unavailability of specific performance or injunctive relief), concepts of materiality, reasonableness, good faith and fair dealing, and the discretion of the court before which a proceeding is brought; (iii) the invalidity under certain circumstances under law or court decisions of provisions providing for the indemnification of or contribution to a party with respect to a liability where such indemnification or contribution is contrary to public policy; and (iv) we express no opinion as to (a) any provision for liquidated damages, default interest, late charges, monetary penalties,

June 24, 2011

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make-whole premiums or other economic remedies to the extent such provisions are deemed to constitute a penalty, (b) consents to, or restrictions upon, governing law, jurisdiction, venue, arbitration, remedies, or judicial relief, (c) the waiver of rights or defenses; (d) any provision requiring the payment of attorneys’ fees, where such payment is contrary to law or public policy; (e) provisions purporting to make a guarantor primarily liable rather than as a surety and provisions purporting to waive modifications of any guaranteed obligation to the extent such modification constitutes a novation; and (f) the severability, if invalid, of provisions to the foregoing effect.

We express no opinion with respect to (i) advance waivers of claims, defenses, rights granted by law, or notice, opportunity for hearing, evidentiary requirements, statutes of limitation, trial by jury or at law, or other procedural rights; (ii) waivers of broadly or vaguely stated rights; (iii) covenants not to compete; (iv) provisions for exclusivity, election or cumulation of rights or remedies; (v) provisions authorizing or validating conclusive or discretionary determinations; (vi) grants of setoff rights; (vii) proxies, powers and trusts; and (viii) provisions prohibiting, restricting, or requiring consent to assignment or transfer of any right or property. We have not been requested to express and, with your consent, do not render any opinion herein with respect to the creation, validity, attachment, perfection or priority of any lien or security interest.

With your consent, we have assumed (a) that the Indenture, the Guarantees, and the Notes (collectively, the “Documents”) have been duly authorized, executed and delivered by the parties thereto other than the Company and each of the Covered Guarantors, (b) that the Documents constitute legally valid and binding obligations of the parties thereto other than the Company and each of the Guarantors, enforceable against each of them in accordance with their respective terms, and (c) that the status of the Documents as legally valid and binding obligations of the parties are not affected by any (i) breaches of, or defaults under, agreements or instruments, (ii) violations of statutes, rules, regulations or court or governmental orders, or (iii) failures to obtain required consents, approvals or authorizations from, or make required registrations, declarations or filings with, governmental authorities.

This opinion is for your benefit in connection with the Registration Statement and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Act. We consent to your filing this opinion as an exhibit to the Registration Statement and to the reference to our firm contained in the Prospectus under the heading “Legal Matters.” In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder.

Very truly yours,

/s/ Latham & Watkins

June 24, 2011

Page 4

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SCHEDULE I

DELAWARE CORPORATE GUARANTORS

 

Entity Name

  

Jurisdiction of Formation

Air System Components, Inc.   Delaware
Aquatic Co.   Delaware
Aquatic Trucking Co.   Delaware
Buffalo Holding Company   Delaware
Conergics Corporation   Delaware
Dexter Axle Acquisition Corp.   Delaware
Dexter Axle Company   Delaware
Dexter Axle Trucking Company   Delaware
EPICOR Industries, Inc.   Delaware
Gates Mectrol, Inc.   Delaware
Hart & Cooley Trucking Company   Delaware
Hart & Cooley, Inc.   Delaware
NRG Industries, Inc.   Delaware
Ruskin Company   Delaware
Ruskin Service Company   Delaware
Schrader Electronics, Inc.   Delaware
Schrader International Holding Co.   Delaware
Schrader-Bridgeport International, Inc.   Delaware
Selkirk Corporation   Delaware
THE GATES CORPORATION   Delaware
Tomkins Automotive Holding Co.   Delaware
Tomkins Building Products, Inc.   Delaware
Waltham Real Estate Holding Co.   Delaware

June 24, 2011

Page 5

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SCHEDULE II

DELAWARE LLC GUARANTORS

 

Entity Name

  

Jurisdiction of Formation

Schrader, LLC   Delaware
Selkirk IP L.L.C.   Delaware

June 24, 2011

Page 6

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SCHEDULE III

DELAWARE LLC GUARANTORS

 

Entity Name   Jurisdiction of Formation
Selkirk Americas, L.P   Delaware
Selkirk Canada Holdings, L.P.   Delaware
Tomkins U.S., L.P.   Delaware

June 24, 2011

Page 7

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SCHEDULE IV

CALIFORNIA GUARANTOR

 

Entity Name

  

Jurisdiction of Formation

CARRIAGE HOUSE FRUIT COMPANY   California

June 24, 2011

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SCHEDULE V

TEXAS GUARANTORS

 

Entity Name

  

Jurisdiction of Formation

GLASS MASTER CORPORATION   Texas
National Duct Systems, Inc.   Texas
NRG Industries, Inc.   Texas
ROOFTOP SYSTEMS, INC.   Texas

June 24, 2011

Page 9

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SCHEDULE VI

OTHER GUARANTORS

 

Entity Name

  

Jurisdiction of Formation

Broadway Mississippi Development, LLC   Colorado
Dexter Chassis Group, Inc.   Michigan
e INDUSTRIES, INC.   Indiana
Eastern Sheet Metal, Inc.   Ohio
FBN Transportation, Inc.   Ohio
Gates Development Corporation   Colorado
Gates International Holdings, LLC   Colorado
HYTEC, INC.   Washington
Ideal Clamp Products, Inc.   Tennessee
Koch Filter Corporation   Kentucky
Tomkins Industries, Inc.   Ohio
ACDTridon (Holdings) Limited   United Kingdom
Air System Components Investments China Limited   United Kingdom
Beta Naco Limited   United Kingdom
British Industrial Valve Company Limited   United Kingdom
Gates Auto Parts Holdings China Limited   United Kingdom
Gates Engineering & Services UK Holdings Limited   United Kingdom
Gates Fluid Power Technologies Investments Limited   United Kingdom
GATES HOLDINGS LIMITED   United Kingdom
Gates Powertrain UK Limited   United Kingdom
H Heaton Limited   United Kingdom
Olympus (Ormskirk) Limited   United Kingdom
Ruskin Air Management Limited   United Kingdom
Shiitake Limited   United Kingdom
Stackpole Investments Limited   United Kingdom
Swindon Silicon Systems Limited   United Kingdom
Tomkins Acquisitions Limited   United Kingdom
Tomkins Engineering Limited   United Kingdom
Tomkins Finance Luxembourg Limited   United Kingdom
Tomkins Finance Limited   United Kingdom
Tomkins Funding Limited   United Kingdom
Tomkins Ideal Clamps (Suzhou) Investments Limited   United Kingdom
Tomkins Investments China Limited   United Kingdom
Tomkins Investments Limited   United Kingdom
TOMKINS LIMITED   United Kingdom
Tomkins Overseas Company   United Kingdom
Tomkins Overseas Investments Limited   United Kingdom

June 24, 2011

Page 10

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Entity Name

  

Jurisdiction of Formation

Tomkins Pension Services Limited   United Kingdom
Tomkins SC1 Limited   United Kingdom
Tomkins Sterling Company   United Kingdom
Tomkins Treasury (Canadian Dollar) Company   United Kingdom
Tomkins Treasury (Dollar) Company   United Kingdom
Tomkins Treasury (Euro) Company   United Kingdom
Trico Products (Dunstable) Limited   United Kingdom
WILLER & RILEY LIMITED   United Kingdom
Schrader Investments Luxembourg S.à r.l.   Luxembourg
Tomkins American Investments S.à r.l.   Luxembourg
TOMKINS AUTOMOTIVE COMPANY, S.à r.l.   Luxembourg
Tomkins Holdings Luxembourg, S.à r.l.   Luxembourg
Tomkins Investment Company S.à r.l.   Luxembourg
Tomkins Luxembourg S.à r.l.   Luxembourg
Tomkins Overseas Holdings S.à r.l.   Luxembourg
Montisk Investments Netherlands C.V.   The Netherlands
Pinafore Holdings B.V.   The Netherlands
ACD Tridon Inc.   Ontario, Canada
Ruskin Company Canada Inc.   Ontario, Canada
Tomkins Automotive Canada Inc.   Ontario, Canada
AMP Industrial Mexican, S.A. de C.V.   Mexico
Aplicadores Mexicanos, S.A. de C.V.   Mexico
Auto Industrial de Partes, S.A. de C.V.   Mexico
Ruskin de Mexico, S.A. de C.V.   Mexico
Tomkins Poly Belt Mexicana, S.A. de C.V.   Mexico
Eifeler Maschinenbau GmbH   Germany
Gates Holding GmbH   Germany
Gates Mectrol GmbH   Germany
Tridon Clamp Products GmbH   Germany
Trion (Deutschland) GmbH   Germany
Gates CIS LLC   Russia
Gates Engineering & Services Australia Pty Ltd   Australia
Gates Engineering & Services Hamriyah FZE   United Arab Emirates
Gates Engineering & Services FZCO   United Arab Emirates
Gates Engineering & Services Ltd.   British Virgin Islands

Gates Fleximak Ltd.

  

British Virgin Islands

GATES GÜÇ AKTARIM SISTEMLERI DAGITIM SANAYI VE TICARET LIMITED SIRKETI

  

Turkey

GATES POWERTRAIN PLASTIK METAL VE MAKINA SANAYII VETICARET LIMITED SIRKETI

  

Turkey

Gates Power Transmission Europe BVBA   Belgium
Schrader Electronics Limited   Northern Ireland

June 24, 2011

Page 11

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Entity Name

  

Jurisdiction of Formation

Schrader International Brasil Ltda.   Brazil
Tomkins Mauritius Company Limited   Mauritius

June 24, 2011

Page 12

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SCHEDULE VII

OTHER LEGAL COUNSEL

 

Jurisdiction

  

Law Firm Name

Colorado   Lathrop & Gage LLP
Indiana   May Oberfell Lorber
Kentucky, Ohio   Dinsmore & Shohl LLP
Michigan   Dykema Gossett PLLC
Tennessee   Baker, Donelson, Bearman, Caldwell & Berkowitz, PC
Washington   Garvey Schubert Barer
Australia   Allen & Overy
Belgium   DLA Piper UK LLP
Brazil   Pinheiro Neto Advogados
British Virgin Islands   Walkers
Canada (Federal); Ontario   Davies Ward Phillips & Vineberg LLP
England and Wales   Latham & Watkins (London) LLP
Germany   Latham & Watkins LLP
The Netherlands   Freshfields Bruckhaus Deringer Amsterdam B.V.
Luxembourg   Luther Rechtsanwaltsgesellschaft mbH
Mauritius   Appleby
Mexico   Ritch Mueller, S.C.
Northern Ireland   Arthur Cox
Russia   Latham & Watkins LLP
Turkey   Hergüner Bilgen Özeke Avukatlik Ortakligi
United Arab Emirates   Hadef & Partners
 EX-5.2 21 dex52.htm EXHIBIT 5.2 Exhibit 5.2

Exhibit 5.2

 

[Lathrop & Gage LLP Letterhead]

June 24, 2011

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, CO 80202

Re: Broadway Mississippi Development, LLC, Gates Development Corporation and Gates International Holdings, LLC

Ladies and Gentlemen:

This firm has acted as special Colorado counsel to Gates Development Corporation, a Colorado corporation, Broadway Mississippi Development, LLC, a Colorado limited liability company, and Gates International Holdings, LLC, a Colorado limited liability company (collectively, the “Local Guarantors”), in connection with the issuance of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) by Tomkins, Inc. (formerly, Pinafore, Inc.) and Tomkins, LLC (formerly, Pinafore, LLC) (collectively the “Issuers”) and the guarantees of the Notes (the “Guarantees”) by the Local Guarantors under an Indenture dated as of September 29, 2010, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011, and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”) entered into among the Issuers, the Guarantors named and defined therein, and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent, and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended (the “Act”), filed with the Securities and Exchange Commission (the “Commission”) on June 24, 2011 (the “Registration Statement”). The Local Guarantors have requested us to render this opinion letter in connection with the submission of the Registration Statement to the Commission.

In our capacity as special Colorado counsel as set forth above, for purposes of rendering the opinions contained in this opinion letter, we reviewed executed originals or copies of (i) the Notes, (ii) the Indenture, (iii) the Guarantees; (iv) the Registration Statement and the Prospectus, and (v) the documents listed on Schedule 1 attached hereto. Such documents described in clause (i) through and including (iii) are referred to collectively as the “Indenture Documents” and the documents described in clauses (i) through and including (v) are referred to collectively in this opinion letter as the “Reviewed Documents.”

In our examination of the Reviewed Documents, we have assumed the genuineness of all signatures (with the exception of those natural persons who executed the Indenture Documents on behalf of the Local Guarantors), the legal capacity of all natural persons the accuracy and completeness of all of the Reviewed Documents, the authenticity of all originals of the Reviewed Documents and the conformity

Tomkins, Inc.

Tomkins, LLC

June 24, 2011

Page 2

to authentic originals of all of the Reviewed Documents submitted to us as copies (including telecopies). As to all matters of fact relevant to the opinions expressed and other statements made herein, we have relied on the representations and statements of fact made in the Reviewed Documents, we have not independently established the facts so relied on, and we have not made any investigation or inquiry other than our examination of the Reviewed Documents. This opinion letter is given, and all statements herein are made, in the context of the foregoing.

Our opinions set forth below are subject to the following further assumptions, limitations and qualifications:

(i) our opinions are limited to the constitution and the laws of the State of Colorado in effect on the date hereof;

(ii) our opinions expressed in subparagraphs (b), (c) and (d) below with respect to matters pertaining to Broadway Mississippi Development, LLC and Gates International Holdings, LLC are limited to the Colorado Limited Liability Company Act, set forth in Section 7-80-101 et seq., Colorado Revised Statutes, as amended (the “Limited Liability Company Act”); and

(iii) our opinions expressed below are based upon a review of only those Colorado laws and regulations that, based on our experience, we have determined to be generally recognized as applicable to transactions of the type contemplated in the Registration Documents and the performance by the Local Guarantors of their respective obligations thereunder.

Based upon, subject to and limited by the assumptions, limitations and qualifications set forth in this opinion letter, we are of the opinion that:

(a)    Based, with your consent, on the good standing certificate specified in item 5 of Schedule 1 attached hereto, we confirm that Gates Development Corporation is validly existing as a corporation and in good standing as of the date of such certificate under the laws of the State of Colorado.

(b)    Based, with your consent, on the good standing certificate specified in item 5 of Schedule 1 attached hereto, we confirm that each of Broadway Mississippi Development, LLC and Gates International Holdings, LLC is validly existing as a limited liability company and in good standing as of the date of such certificate under the laws of the State of Colorado.

(c)    Gates Development Corporation has the requisite power and authority under the laws of the State of Colorado, its Amended and Restated Articles of Incorporation and its Amended and Restated By-Laws, and each of Broadway Mississippi Development, LLC and Gates International Holdings, LLC has the requisite power and authority under the Limited Liability Company Act, its Articles of Organization, as amended, and its Operating Agreement, as amended, to execute and to perform its obligations under the Indenture Documents to which it is a party.

(d)    Each Local Guarantor has duly authorized the execution and delivery of the Indenture Documents to which it is a party, and each Local Guarantor has duly executed and delivered the Indenture Documents to which it is a party.

Tomkins, Inc.

Tomkins, LLC

June 24, 2011

Page 3

The foregoing opinions are limited to the matters expressly covered therein, and no other opinions should be implied or inferred based on such limited opinions. Without limiting the generality of the foregoing, we express no opinion herein as to (i) the legality, validity or enforceability of the Indenture Documents or any other agreements, certificates or documents, as the case may be, delivered by any Local Guarantor or any other party in connection with the Registration Statement; (ii) any other laws and regulations not specifically identified herein (and, in particular, we express no opinion as to any effect that such other laws and regulations may have on the opinions expressed herein); (iii) the applicability or application of, or compliance with, or the effect of any federal or state securities, antitrust, unfair competition, banking, or tax laws or regulations in connection with the offering, issuance and sale of the Notes or the matters addressed herein; (iv) the applicability or application of, or compliance with, or the effect of any ordinances, codes or regulations of any political subdivision of the State of Colorado.

We also note that with respect to our opinions contained in this opinion letter, we have been retained as special Colorado counsel in the limited capacity described herein, but we do not represent the Local Guarantors in their business activities generally and are not necessarily familiar with the nature and extent of such activities. Our knowledge of each Local Guarantor’s business, records, transactions and activities is limited to the information that has been brought to our attention by or on behalf of such Local Guarantor in the scope and course of our limited representation as its special Colorado counsel for the matters discussed herein. We express no opinion as to any matters pertaining to the business activities generally of any Local Guarantor or any agreement, instrument or document other than those expressly addressed herein.

We assume no obligation to advise you of any changes in our opinions set forth herein subsequent to the delivery of this opinion letter as of the date set forth above. The opinions expressed herein are as of the date hereof only and based on laws, orders, contract terms and provisions and facts of such date and we disclaim any obligation to update this opinion letter after such date or to advise you of changes of fact stated or assumed herein or subsequent changes of law. This opinion letter has been prepared solely for your use in connection with the Indenture Documents, and should not be quoted in whole or in part or otherwise be referred to, and should not be filed with or furnished to any governmental agency or other person or entity except as described below, without the prior written consent of this firm.

This opinion letter may be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the filing of the Registration Statement, and any amendments thereto, including any post-effective amendments to be filed by the Issuers.

We hereby consent (i) to being named in the Registration Statement and in any amendments thereto as counsel for the Local Guarantors, (ii) to the statements with reference to our firm made in the Registration Statement, and (iii) to the filing of this opinion as an exhibit to the Registration Statement.

 

Very truly yours,

 

/s/ LATHROP & GAGE LLP

SCHEDULE 1

REVIEWED DOCUMENTS

 

  1. The Amended and Restated Articles of Incorporation of Gates Development Corporation, as certified by an Authorized Representative of such Local Guarantor on June 23, 2011 as being true, complete and in effect.

 

  2. The Amended and Restated By-Laws of Gates Development Corporation, as certified by an Authorized Representative of such Local Guarantor on June 23, 2011 as being true, complete and in effect.

 

  3. The Articles of Organization of each of Broadway Mississippi Development, LLC and Gates International Holdings, LLC, as amended, each as certified by the Secretary of State of the State of Colorado on September 22, 2010 and as certified by an Authorized Representative of each such Local Guarantor on September 20, 2010 and on June 23, 2011 as being true, complete and in effect.

 

  4. The Operating Agreement of Broadway Mississippi Development, LLC and the Operating Declaration of the Sole Member of Gates International Holdings, LLC, as amended by Amendment No. 1 to Operating Declaration, dated as of June 23, 2011, each as certified by an Authorized Representative of each such Local Guarantor on September 20, 2010 and June 23, 2011 as being true, complete and in effect.

 

  5. A certificate of good standing of each of the Local Guarantors issued by the Secretary of State of the State of Colorado, each dated June 21, 2011.

 

  6. Certain resolutions of the Board of Directors of Gates Development Corporation and the Sole Member of each of Broadway Mississippi Development, LLC and Gates International Holdings, LLC, adopted by unanimous written consent dated September 20, 2010, as certified by an Authorized Representative of each of such Local Guarantors on September 29, 2010 and on June 23, 2011 as being true, complete and in effect.

 

  7. A certificate of an Authorized Representative of each of the Local Guarantors, dated September 20, 2010, as to incumbency and signatures and certain facts relating to each such Local Guarantor.

 

  8. Joint Action by Written Consent of the Board of Directors and Sole Shareholder of Gates Development Corporation, dated June 23, 2011, as certified by an Authorized Representative of such Local Guarantor as being true, complete and in effect.

 

  9. A certificate of certain Authorized Representatives of each of the Local Guarantors, dated June 23, 2011, regarding certain facts relating to each such Local Guarantor.
EX-5.3 22 dex53.htm EXHIBIT 5.3 Exhibit 5.3

Exhibit 5.3

[May Oberfell Lorber Letterhead]

June 24, 2011

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, Colorado 80202

Ladies and Gentlemen:

We have acted as special Indiana counsel to e Industries, Inc., an Indiana corporation (the “Indiana Guarantor”) in connection with certain obligations of its affiliated companies, Pinafore, Inc., and Pinafore, LLC (the “Issuers”). This opinion is delivered in connection with the filing of a registration statement on Form F-4 (the “Registration Statement”) under the Securities Act of 1933, as amended (the “Securities Act”), relating to the registration of $1,150,000,000 aggregate principal amount of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “New Notes”).

In connection with rendering this opinion, we have examined copies, certified or otherwise identified to our satisfaction of the following:

 

  (a) the Registration Statement;

 

  (b) the Indenture dated as of September 29, 2010 by and between the Issuers, the Indiana Guarantor, the other guarantors named therein, and Wilmington Trust FSB, as Trustee and Collateral Agent, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dates as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011, and the Seventh Supplement Indenture dated as of March 3, 2011 (collectively, the “Indenture”);

 

  (c) the form of New Notes;

 

  (d) the Purchase Agreement dated as of September 21, 2010 by and among the Issuers, Pinafore Acquisitions Limited, as a guarantor, and Banc of America Securities LLC, Citigroup Global Markets Inc., Barclays Capital Inc., RBC Capital Markets Corporation and UBS Securities LLC, as representatives (the “Representatives” of the several initial purchasers named on Schedule A thereto (collectively, the “Initial Purchasers”) (the “Original Purchase Agreement”);

Tomkins, Inc.

Tomkins, LLC

June 24, 2011

 

  (e) The Joinder Agreement dated as of September 29, 2010, by and among the Indiana Guarantor, the other guarantors party thereto, and the Representatives (the “Joinder Agreement”) (the Original Purchase Agreement, as supplemented by the Joinder Agreement is hereafter referred to as the “Purchase Agreement”);

 

  (f) the Registration Rights Agreement, dated as of September 29, 2010, by and between the Issuers and the guarantors party thereto (including the Indiana Guarantor), on the one hand, and the Representatives on the other (the “Registration Rights Agreement”) (the Registration Rights Agreement, Indenture, Registration Statement, New Notes, and Purchase Agreement are hereafter referred to, collectively, as the “Notes Documents”);

 

  (g) a copy of the By-Laws of the Indiana Guarantor, certified by the secretary or another officer of the Indiana Guarantor (the “By-Laws”);

 

  (h) a copy of the Articles of Incorporation of the Indiana Guarantor, certified by the secretary or another officer of the Indiana Guarantor as well as the Certificate of Incorporation of the Guarantor, certified by the Indiana Secretary of State (together, with the By-Laws, the “Governing Documents”);

 

  (i) a certificate of existence issued by the Secretary of State of the State of Indiana with respect to the Indiana Guarantor (the “Entity Certificate”);

 

  (j) a copy of the authorizing resolutions of the Indiana Guarantor, certified by the secretary or another officer of the Indiana Guarantor, relating to the Registration Statement, Indenture and New Notes; and

 

  (k) the officer’s certificates of the Indiana Guarantor relating to certain of the factual assumptions made in this opinion letter (the “Officer’s Certificate”).

We have assumed due authorization, execution and delivery of the Notes Documents, and the other agreements and documents referred to in this opinion by, and the enforceability of the Notes Documents upon, all parties other than the Indiana Guarantor. We have also assumed the correctness of all statements of fact contained in all agreements, certificates (including, but not limited to, those certificates referenced in paragraphs g through k above), and other documents examined by us; the correctness of all statements of fact made in response to our inquiries by officers and other representatives of the Indiana Guarantor and by public officials; the legal capacity of all natural persons; the genuineness of all signatures on all agreements and other documents examined by us; the authenticity of all documents submitted to us as originals; and the conformity to authentic original documents of all documents submitted to us as copies.

 

Page 2

Tomkins, Inc.

Tomkins, LLC

June 24, 2011

 

Based upon the foregoing and subject to the assumptions, exceptions, qualifications and limitations set forth hereinafter, we are of the opinion that:

 

  1. Based solely upon our review of the Entity Certificate, the Indiana Guarantor is validly existing as a corporation under the laws of the State of Indiana;

 

  2. The Indiana Guarantor has the corporate power and authority under the laws of the State of Indiana to execute and deliver, and perform all of its obligations under, the Indenture (including the guarantees by the Indiana Guarantor of the New Notes);

 

  3. The Indenture (which includes the guarantees made by the Indiana Guarantor of the New Notes) has been duly authorized, executed and delivered by the Indiana Guarantor under the laws of the State of Indiana.

We call your attention to the fact that, as a matter of customary practice, certain assumptions underlying opinions are understood to be implicit. In addition, the foregoing opinions are also subject to the following additional qualifications, exceptions, assumptions and limitations:

We express no opinion as to any matter relating to the laws of any jurisdiction other than the laws of the State of Indiana. This opinion is limited to the effect of the current state of the laws of the State of Indiana and the facts as they currently exist. We express no opinion as to any question of enforceability that may arise under securities or antitrust laws of Indiana or of the United States.

We express no opinion as to the impact on any guarantee made by the Indiana Guarantor, or on the corporate power and authority of the Indiana Guarantor, to enter into and perform its obligations under any guarantee, of any laws or principles regarding conveyances of property or interests therein or the incurrence of obligations as a fraud on creditors or without whatever consideration is deemed necessary thereunder.

We consent to being named in the Registration Statement and in any amendments thereto as counsel for the Indiana Guarantor. We consent to the statements with reference to our firm made in the Registration Statement. We consent to the filing of this opinion as an exhibition to the Registration Statement. In giving these consents, we do not admit that we are included in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission.

This opinion is made for the benefit of and may be relied upon by the addressees thereof. This opinion also may be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in

 

Page 3

Tomkins, Inc.

Tomkins, LLC

June 24, 2011

 

connection with the Registration Statement, and any amendments thereto, including any post-effective amendments to be filed by the Issuers with the Securities and Exchange Commission under the Securities Act.

The opinions set forth in this letter are effective as of the date hereof. We express no opinions other than as herein expressly set forth, and no expansion of our opinions may be made by implication or otherwise. We do not undertake to advise you of any matter within the scope of this letter which comes to our attention after the delivery of this letter, and we disclaim any responsibility to advise you of future changes in law or fact which may affect the above opinions.

Very truly yours,

/s/ May Oberfell Lorber

MAY OBERFELL LORBER

 

Page 4

EX-5.4 23 dex54.htm EXHIBIT 5.4 Exhibit 5.4

Exhibit 5.4

 

 

Michael G. Dailey
513-977-8644
Michael.Dailey@dinslaw.com

[Dinsmore & Shohl LLP Letterhead]

June 24, 2011

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, CO 80202

Ladies and Gentlemen:

We have acted as special counsel in the State of Ohio to Tomkins Industries, Inc., an Ohio corporation, Eastern Sheet Metal, Inc., an Ohio corporation, and FBN Transportation, Inc., an Ohio corporation collectively, the “Companies”), in connection with the issuance of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) by Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly, Pinafore, LLC) and the guarantees of the Notes (the “Guarantees”) by the Companies under an Indenture dated as of September 29, 2010, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”) entered into among the Issuers, the Guarantors named therein, and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent, and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended (the “Act”), filed with the Securities and Exchange Commission (the “Commission”) on June 24, 2011 (Registration No. 333-______) (the “Registration Statement”).

In connection with rendering this opinion, we have examined copies, certified or otherwise identified to our satisfaction, of the following:

 

  (a) the Registration Statement;

 

  (b) the Indenture;

 

  (c) the Notes;

 

  (d)

the Articles of Incorporation, as amended, of each of the Companies,

June 24, 2011

Page 2

certified by the Secretary of each of the Companies as now in effect and as in effect at the time of the adoption of the resolutions of the board of directors of each of the Companies referred to in paragraph (f) below;

 

  (e) the Bylaws of each of the Companies, certified by the Secretary of the Companies as now in effect;

 

  (f) copies of certain resolutions of the board of directors of each of the Companies adopted on September 20, 2010, and certified by the Secretary of the Companies, which resolutions have not been amended, superseded or revoked;

 

  (g) a certificate dated June 23, 2011, of the Secretary of State of the State of Ohio as to the entity status and good standing of each of the Companies, and

 

  (h) such other documents, certificates and records as we have deemed necessary or appropriate as a basis for the opinions set forth herein.

In such examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, conformity to the original documents of all documents submitted to us as copies and the authenticity of the originals of such latter documents. As to any facts material to our opinion, we have, when relevant facts were not independently established, relied upon the aforesaid records, certificates and documents.

Based upon the foregoing and subject to the assumptions, exceptions, qualifications and limitations set forth hereinafter, we are of the opinion that:

 

  1. Each of the Companies is a corporation validly existing and in good standing under the laws of the State of Ohio.

 

  2. Each of the Companies has the corporate power and authority under the laws of the State of Ohio to execute and deliver, and perform all of its obligations under, the Indenture (including the guarantees by the Companies of the Notes).

 

  3. The Indenture (which includes the guarantees by the Companies of the Notes) have been duly authorized, executed and delivered by each of the Companies under the laws of the State of Ohio.

The opinion in paragraph 1 above is based solely upon our review of certificates and other communications from officials of the State of Ohio. The opinions expressed herein are as of the date hereof only and are based on laws, orders, contract terms and provisions, and facts as of such date, and we disclaim any obligation to update this opinion letter after such date or to advise you of changes of facts stated or assumed herein or any subsequent changes in applicable law.

June 24, 2011

Page 3

Our opinion set forth herein reflects only the application of applicable Ohio state law (excluding the securities and blue sky laws of such state, as to which we express no opinion) and the federal laws of the United States of America. The opinion set forth herein is made as of the date hereof and is subject to, and may be limited by, future changes in the factual matters set forth herein, and we undertake no duty to advise you of the same. The opinion expressed herein is based upon the law in effect (and published or otherwise generally available) on the date hereof, and we assume no obligation to revise or supplement this opinion should such law be changed by legislative action, judicial decision or otherwise. In rendering our opinion, we have not considered, and hereby disclaim any opinion as to, the application or impact of any laws, cases, decisions, rules or regulations of any other jurisdiction, court or administrative agency.

We do not render any opinions except as expressly set forth above. The opinions set forth herein are made as of the date hereof. We hereby consent (i) to being named in the Registration Statement and in any amendments thereto as counsel for the Company, (ii) to the statements with reference to our firm made in the Registration Statement, (iii) to the filing of this opinion as an exhibit to the Registration Statement, and (iv) to allow Latham & Watkins LLP to rely on this opinion. In giving such consent, we do not thereby concede that we are within the category of persons whose consent is required under Section 7 of the Act or the Rules and Regulations of the Commission thereunder.

 

 

Very truly yours.

 

/s/ Michael G. Dailey

 

DINSMORE & SHOHL LLP

 

 EX-5.5 24 dex55.htm EXHIBIT 5.5 Exhibit 5.5

Exhibit 5.5

 

LOGO    

Dykema Gossett PLLC

Suite 300

39577 Woodward Avenue

Bloomfield Hills, Michigan 48304

 

www.dykema.com

 

Tel: (248) 203-0700

Fax: (248) 203-0763

June 24, 2011

Tomkins, Inc.

Tomkins, LLC

155 Wewatta Street

Denver, Colorado 80202

Ladies and Gentlemen:

We have acted as special Michigan counsel for Dexter Chassis Group, Inc., a Michigan corporation (the “Guarantor”), in connection with the Registration Statement on Form F-4 to which this opinion has been filed as an exhibit (the “Registration Statement”). The Registration Statement relates to the proposed issuance and exchange (the “Exchange Offer”) of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Exchange Notes”) of Tomkins, Inc., a Delaware corporation, and Tomkins, LLC, a Delaware limited liability company, (collectively, the “Issuers”), for an equal principal amount of outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Initial Second Lien Notes”) of the Issuers, and the guarantee of the Exchange Notes (the “Guarantee”) by, among other entities, the Guarantor pursuant to the Indenture referred to below. The Initial Second Lien Notes have been, and the Exchange Notes will be, issued pursuant to an indenture , dated as of September 29, 2010, among the Issuers, the Guarantor and Wilmington Trust FSB, as trustee (the “Trustee”), among other parties , as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011 (the “Fifth Supplemental Indenture), the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”).

In connection with this opinion, we have (i) investigated such questions of law, (ii) examined originals or certified, conformed or reproduction copies of such agreements, instruments, documents and records of the Guarantor, such certificates of public officials and such other documents and (iii) received such information from officers and representatives of the Guarantor and others, in each case, as we have deemed necessary or appropriate for the purposes of this opinion. We have examined, among other documents, the following:

 

  (a) the Indenture and the Guarantee contained therein; and

 

  (b) the form of Exchange Notes attached to the Indenture as an Exhibit.

In all such examinations, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of original and certified documents and the conformity to original or certified documents of all copies submitted to us as conformed or reproduction copies. As to various questions of fact relevant to the opinions expressed herein, we have relied upon, and assume the accuracy of, certificates and oral or written statements and other information of or from public officials and officers and representatives of the Guarantor.

Based upon the foregoing and subject to the limitations, qualifications and assumptions set forth herein, we are of the opinion that:

(1) The Guarantor (a) is a corporation existing and in good standing under the laws of the State of Michigan, and (b) has the necessary corporate power to guarantee the Exchange Notes pursuant to the terms of the Indenture.

(2) The Guarantee of the Exchange Notes pursuant to the terms of the Indenture and the execution and delivery of the Indenture have been duly authorized by all necessary corporate action of, and the Indenture has been executed and delivered by, the Guarantor.

The opinions expressed herein with respect to the existence and/or good standing of the Guarantor are based solely on certificates of public officials as to factual matters and legal conclusions set forth therein.

The opinions set forth above are subject to (i) applicable bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance and other similar laws now or hereafter in effect relating to or affecting creditors’ rights and remedies generally, and (ii) general principles of equity including, without limitation, standards of materiality, good faith, fair dealing and reasonableness, equitable defenses and limits as to the availability of equitable remedies, whether such principles are considered in a proceeding at law or in equity.

For purposes of the opinions expressed herein, we assume for purposes of this opinion that the each of the other parties to the Indenture (other than the Guarantor) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization; that each such party is duly qualified to engage in the activities contemplated by the Indenture; that the Indenture has been duly authorized, executed and delivered by each such party and constitutes the legally valid, binding and enforceable obligation of each such party enforceable against each such party in accordance with its terms; that the Trustee is in compliance, generally and with respect to acting as a trustee under the Indenture, with all applicable laws and regulations; and that the Trustee has the requisite organizational and legal power and authority to perform its obligations under the Indenture.

The opinions expressed herein are limited to the federal laws of the United States of America and the laws of the State of Michigan. The opinions expressed herein are limited to the matters stated herein, and no opinion is implied or may be inferred beyond the matters expressly stated herein. The opinions expressed herein are given as of the date of effectiveness of the Registration Statement, and we undertake no obligation to supplement this letter if any applicable laws change after that date or if we become aware of any facts that might change the opinions expressed herein after that date or for any other reason.

This opinion is made for the benefit of and may be relied upon by the addressees thereof. This opinion also may be relied upon by Latham & Watkins LLP in the issuance of its opinion

letter in connection with the Registration Statement, and any amendments thereto, including any post-effective amendments to be filed by the Issuers with the Securities and Exchange Commission under the Securities Act of 1933, as amended.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to this firm under the caption “Legal Matters” in the prospectus which forms a part thereof. In giving such consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Securities and Exchange Commission promulgated thereunder.

Very truly yours,

/s/ DYKEMA GOSSETT PLLC

EX-5.6 25 dex56.htm EXHIBIT 5.6 Exhibit 5.6

Exhibit 5.6

 

LOGO

  

FIRST TENNESSEE BUILDING

165 MADISON AVENUE

SUITE 2000

MEMPHIS, TENNESSEE 38103

PHONE: 901.526.2000

FAX: 901.577.2303

     www.bakerdonelson.com

 

 

June 24, 2011

Tomkins, Inc. and

Tomkins, LLC

1551 Wewatta Street

Denver, CO 80202

 

  RE: $1,150,000,000 of 9% Senior Secured Second Lien Notes

Ladies and Gentlemen:

We have acted as special counsel in the State of Tennessee (the “State”) to Ideal Clamp Products, Inc., a corporation organized under the law of the State of Tennessee (the “TN Guarantor”), in connection with the issuance of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) by Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly, Pinafore, LLC) (collectively, the “Issuers”) and the guarantee of the Notes (the “Note Guarantee”) by TN Guarantor under an Indenture dated as of September 29, 2010 (the “Original Indenture”) as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011, and the Seventh Supplemental Indenture dated as of March 3, 2011 (as so supplemented, the “Indenture”) entered into among the Issuers, the Guarantors named therein, and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent.

For the purposes of this opinion letter (the “Opinion Letter”), we have examined a copy of the Indenture, including the Note Guarantee contained therein, which has been identified to our satisfaction.

We have also examined the following organizational documents of the TN Guarantor (the documents referred to in paragraphs (i) through (vi) below being hereinafter referred to as the “Organizational Documents”):

 

  (i) Charter certified by the Tennessee Secretary of State on September 20, 2010;

  (ii) Bylaws certified by an officer of the TN Guarantor pursuant to a Closing Certificate dated September 29, 2010;
  (iii) Closing Certificate dated September 29, 2010 certifying the incumbency of the persons specified therein;
  (iv) Action by Written Consent of the Board of Directors of the TN Guarantor dated as of September 20, 2010;
  (v) Action by Written Consent of the Board of Directors of the TN Guarantor dated January 20, 2011; and
  (vi) Certificate of Existence issued by the Tennessee Secretary of State on June 17, 2011 (the “Certificate of Existence”).

Except as set forth above concerning the Indenture and the Organizational Documents that we have reviewed, we have not reviewed any other documents, and no opinions contained herein shall pertain to any other documents. To the extent that opinions expressed below involve matters of fact, we have relied upon the representations and warranties made in the Indenture and the Organizational Documents.

In making such examinations, we have with your permission assumed that:

 

  (a) the Indenture examined by us conforms to the original, has been properly completed with blank spaces filled in and exhibits attached, and has not been modified, amended, rescinded or terminated since March 3, 2011, and said Indenture remains in full force and effect;

 

  (b) except as set forth in Opinion Paragraph 1 below, the corporations, partnerships or limited liability companies which are parties to the Indenture are duly organized, validly existing and in good standing under the laws applicable to their respective organization and existence and in all other places in which they are conducting their respective businesses;

 

  (c) except as set forth in Opinion Paragraphs 2 and 3 below, the Indenture has been duly authorized, executed, and delivered by each of the parties for value received, and nothing in the articles of incorporation, bylaws (or the equivalent thereof), the partnership agreement or certificate of limited partnership, the operating agreement or certificate of formation of any of the parties prohibits any of the parties from executing the Indenture or performing the transactions contemplated by the Indenture, and each of the parties has the full corporate, partnership or limited liability company power and authority to deliver and perform its obligations under the Indenture and documents required or permitted to be executed, delivered and performed thereunder;

 

  (d) all signatures on the Indenture are genuine, and all individuals executing the Indenture have legal capacity;

  (e) the Indenture, including the Note Guarantee contained therein, is valid and enforceable against the parties thereto in accordance with its terms under the laws of the State of New York, and the transaction bears a reasonable relationship to that state;

 

  (f) the Organizational Documents have not been modified, amended, rescinded or terminated since the dates specified above with respect to such Organizational Documents, and such Organizational Documents remain in full force and effect;

 

  (g) all factual statements set forth in the Indenture and the Organizational Documents are true, accurate and complete in all material respects;

 

  (h) no articles of dissolution, no certificate of cancellation, no notice of intent to dissolve, no application for withdrawal, no statement of commencement of winding up nor any similar document has been filed or is pending with respect to TN Guarantor;

 

  (i) no petition has been filed in any court of competent jurisdiction to dissolve TN Guarantor or challenge the TN Guarantor’s execution, delivery and performance under the Original Indenture;

 

  (j) no petition has been filed by the Attorney General of the State proposing the dissolution of the TN Guarantor or the forfeiture of TN Guarantor’s articles of incorporation;

 

  (k) the exercise of any remedy by the Trustee or Holders (as such terms are defined in the Indenture) with respect to the Indenture in any other state will not, under the laws of such other state, impair the exercise of remedies in the State;

 

  (l) there are no corporate resolutions of TN Guarantor relating to the Indenture other than those listed among the Organizational Documents;

 

  (m) no proceedings by or against TN Guarantor have been commenced in bankruptcy or for reorganization, liquidation or the readjustment of debts under the federal or any state bankruptcy code or any other law, nor has TN Guarantor made an assignment for the benefit of creditors, admitted in writing inability to pay debts generally as they become due, or filed or had filed against it any action seeking an order appointing a trustee or receiver of all or a substantial part of the property of TN Guarantor; and

 

  (n) the Guaranteed Obligations (as such term is defined in the Indenture) are enforceable against the TN Guarantor.

Although we have not conducted an independent investigation of the accuracy of any of these assumptions, nothing has come to our attention leading us to question the accuracy of said assumptions.

Based on the foregoing assumptions and subject to the qualifications and limitations set forth below, we are of the opinion that:

1.       Based solely on the Certificate of Existence, TN Guarantor is a corporation, validly existing and in good standing under the laws of the State.

2.       TN Guarantor has all necessary corporate power and authority to execute and deliver, and perform its obligations under, the Original Indenture, and has taken all corporate action required to authorize the execution and delivery of, and the performance of its obligations under, the Original Indenture.

3.       TN Guarantor has duly executed and delivered the Original Indenture.

The opinions set forth above are qualified as stated therein and are further qualified as follows:

 

  (a) The opinions set forth in this Opinion Letter are subject to applicable bankruptcy, reorganization, insolvency, fraudulent conveyance, moratorium, or other laws of general application relating to or affecting the enforcement of creditors’ rights, from time to time in effect.

 

  (b) We have not undertaken any independent investigation to determine the existence or absence of such facts which would be contrary to the opinions expressed herein, and no inference as to the knowledge of the existence of such facts should be drawn from the fact of our representation of TN Guarantor as its special counsel.

Our opinions are subject to the further qualification that we express no opinion as to:

 

  (i) the effects of actions and omissions of the Trustee or Holders heretofore or hereafter occurring, whether intentional or unintentional, constituting fraud, bad faith, commercial unreasonableness, misrepresentation, duress, coercion, obstruction of TN Guarantor’s performance, failure to perform or other similar basis for limiting Trustee’s or Holders’ remedies;

 

  (ii) the application or effect of any federal or state securities laws or federal, state or local environmental laws on or to the transaction governed by the Indenture;

  (iii) the effect of any federal or state tax lien or state employee liens on the rights and remedies afforded to the Trustee or Holders under the Indenture or the legal rights of government agencies of attachment or forfeiture under various criminal statutes; or

 

  (iv) the enforceability of the Indenture.

This Opinion Letter is presumed to deal only with the specific legal issues that are addressed by it. Accordingly, any express opinion concerning a particular legal issue is presumed not to address any other matters. Even if this presumption against opinion by implication can be overcome by compelling rebuttal, the legal issues specified in the foregoing paragraphs are covered only if and to the extent any such issue is specifically addressed in this Opinion Letter.

The opinions contained in this Opinion Letter are expressions of professional judgment regarding the legal matters addressed and not guarantees that a court will reach any particular result.

The law covered by the opinions expressed in this Opinion Letter is limited to the law of the State. We express no opinion concerning the laws of any other jurisdiction, or the effect thereof. We further express no opinion concerning the statutes and ordinances, the administrative decisions, and the rules and regulations of counties, towns, municipalities and special political subdivisions (whether created or enabled through legislative action at the Federal, state or regional level) and judicial decisions to the extent that they deal with any of the foregoing.

This Opinion Letter is rendered as of the effective date set forth above and addresses the law as of such date. We express no opinion as to circumstances or events which may occur subsequent to the date hereof, nor do we undertake any obligation to inform you of any changes in the law occurring after the date hereof.

This Opinion Letter is made for the benefit of and may be relied upon by the addressees thereof. This Opinion Letter also may be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the Registration Statement on Form F-4 for the Issuers with respect to the Notes, and any amendments thereto, including any post-effective amendments (collectively referred to as the “Registration Statement”) to be filed by the Issuers with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”). We hereby consent to the filing of this Opinion Letter as Exhibit 5.6 to the Registration Statement. In giving this consent, we do not admit that we are “experts” within the meaning of Section 11 of the Securities Act or within the category of persons whose consent is required by Section 7 of the Securities Act. Except as set forth above, this Opinion Letter may not be otherwise filed publicly, nor used in connection with any other transaction not contemplated by the Indenture.

Very truly yours,

/s/    Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C

EX-5.7 26 dex57.htm EXHIBIT 5.7 Exhibit 5.7

Exhibit 5.7

[Garvey Schubert Barer Letterhead]

June 24, 2011

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, Colorado 80202

Ladies and Gentlemen:

We have acted as special counsel in the State of Washington to Hytec, Inc., a Washington corporation (the “Washington Guarantor”) in connection with certain obligations of its affiliated companies, Tomkins, Inc., a Delaware corporation formerly known as Pinafore, Inc. (the “Corporate Co-Issuer”), and Tomkins, LLC, a Delaware limited liability company formerly known as Pinafore, LLC (the “LLC Co-Issuer” and together with the Corporate Co-Issuer, the “Issuers”). This opinion is delivered in connection with the filing of a registration statement on Form F-4 (the “Registration Statement”) under the Securities Act of 1933, as amended (the “Securities Act”), relating to the registration of $1,150,000,000 aggregate principal amount of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “New Notes”) in connection with an offer by the Issuers to issue the New Notes in exchange for the Issuers’ outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Old Notes”). The Old Notes are, and the New Notes will be, issued pursuant to an Indenture dated as of September 29, 2010, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”) entered into among the Issuers, the Guarantors named therein, and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent.

In connection with rendering this opinion, we have examined copies, certified or otherwise identified to our satisfaction, of the following:

(a) the Registration Statement and the prospectus forming a part thereof;

(b) the Indenture;

 

June 24, 2011

Page 2

 

(c) the Articles of Incorporation, as amended, of the Washington Guarantor, certified by the Secretary of State of the State of Washington on June 21, 2011;

(d) the By-laws of the Washington Guarantor;

(e) a written consent of the board of directors of the Washington Guarantor adopted on September 20, 2010 and certified by an officer of the Washington Guarantor;

(f) a Certificate of Existence/Authorization of the Washington Guarantor issued by the Secretary of State of the State of Washington, dated June 21, 2011;

(g) a certificate of an officer of the Washington Guarantor dated September 29, 2010 as to certain factual matters and the authority, incumbency and signatures of such authorized persons of the Washington Guarantor; and

(h) such other documents, certificates and records as we have deemed necessary or appropriate as a basis for the opinions set forth herein.

In such examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, conformity to the original documents of all documents submitted to us as copies and the authenticity of the originals of such latter documents. As to any facts material to our opinion, we have, when relevant facts were not independently established, relied upon the aforesaid records, certificates and documents.

Based upon the foregoing and subject to the assumptions, exceptions, qualifications and limitations set forth hereinafter, we are of the opinion that:

1. The Washington Guarantor is a corporation validly existing under the laws of the State of Washington.

2. The Washington Guarantor has the corporate power and authority under the laws of the State of Washington to execute and deliver, and perform all of its obligations under, the Indenture (including the guarantees by the Washington Guarantor of the New Notes).

3. The Indenture has been duly authorized, executed and delivered by the Washington Guarantor under the laws of the State of Washington.

The opinions expressed herein are limited exclusively to the internal laws of the State of Washington. The opinion in paragraph 1 above is based solely upon our review of certificates and other communications from officials of the State of Washington.

We hereby consent (i) to being named in the Registration Statement and in any amendments thereto as counsel for the Washington Guarantor, (ii) to the statements with reference to our firm made

 

June 24, 2011

Page 3

 

in the Registration Statement and (iii) to the filing of this opinion as an exhibit to the Registration Statement.

This opinion is made for the benefit of and may be relied upon only by the addressees hereof in connection with filing the Registration Statement, except that Latham & Watkins LLP may also rely on this opinion in connection with the issuance of its opinion filed as an exhibit to the Registration Statement.

The opinions expressed herein are as of the date hereof only and are based on laws, orders, contract terms and provisions, and facts as of such date, and we disclaim any obligation to update this opinion letter after such date or to advise you or any other person of changes of facts stated or assumed herein or any subsequent changes in applicable law.

 

Sincerely,
/s/ Garvey Schubert Barer

GARVEY SCHUBERT BARER

a partnership of professional corporations

 EX-5.8 27 dex58.htm EXHIBIT 5.8 Exhibit 5.8

Exhibit 5.8

 

To:   Tomkins, Inc. and Tomkins, LLC

1551 Wewatta Street

Denver, Colorado 80202

United States

   

Allen & Overy

Level 7, Gold Fields House

1 Alfred Street

Sydney NSW 2000

Australia

 

PO Box R1256

Royal Exchange

Sydney NSW 1225

 

Tel                  +61 (0)2 9373 7700

Direct             +61 (0)2 9373 7745

Angela.Flannery@allenovery.com

24 June 2011

   

Dear Sirs

Indenture dated as of 29 September 2010, as supplemented – Senior Secured Second Lien Notes

In providing this opinion, we have acted as special counsel to Tomkins, Inc. (formerly Pinafore, Inc.), a Delaware limited liability company and Tomkins, LLC (formerly, Pinafore, LLC), a Delaware corporation (Issuers), in connection with their issuance of US$1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (Notes) and the guarantees of the Notes (Guarantees) by the Issuers under an Indenture dated as of September 29, 2010, as supplemented by the First Supplemental Indenture dated as of 18 November 2010, the Second Supplemental Indenture dated as of 21 December 2010, the Third Supplemental Indenture dated as of 23 December 2010, the Fourth Supplemental Indenture dated as of 20 January 2011, the Fifth Supplemental Indenture dated as of 23 February 2011, the Sixth Supplemental Indenture dated as of 24 February 2011 and the Seventh Supplemental Indenture dated as of 3 March 2011 (Indenture) entered into among the Issuers, the Note Guarantors named therein, and Wilmington Trust FSB, as trustee (Trustee) and collateral agent, and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended, filed with the Securities and Exchange Commission (Commission) on June 24, 2011 (Registration Statement).

Terms defined in the Indenture, have, unless otherwise defined in this opinion or the context otherwise requires, the same meanings when used in this opinion.

We have not investigated the laws of any jurisdiction other than the laws of the State of Western Australia, the State of New South Wales and the federal laws of the Commonwealth of Australia as they apply in the State of Western Australia or the State of New South Wales (together, the Relevant Jurisdictions) and this opinion is given only with respect to the laws of the Relevant Jurisdictions (Relevant Laws). Relevant Courts has a corresponding meaning.

This opinion is to be construed in accordance with, and our liability under it will be determined under, the laws of the State of New South Wales.

Allen & Overy is affiliated with Allen & Overy LLP, a limited liability partnership registered in England and Wales with registered office at One Bishops Square London E1 6AD.

Allen & Overy LLP or an affiliated undertaking has an office in each of: Abu Dhabi, Amsterdam, Antwerp, Athens, Bangkok, Beijing, Bratislava, Brussels, Bucharest (associated office), Budapest, Doha, Dubai, Düsseldorf, Frankfurt, Hamburg, Hong Kong, Jakarta (associated office), London, Luxembourg, Madrid, Mannheim, Milan, Moscow, Munich, New York, Paris, Perth, Prague, Riyadh (associated office), Rome, São Paulo, Shanghai, Singapore, Sydney, Tokyo and Warsaw.

1. DOCUMENTS, ASSUMPTIONS AND QUALIFICATIONS

We have examined and relied on the documents listed in Schedule 1 and make the assumptions and qualifications set out in Schedule 2.

 

2. OPINION

Based upon and subject to the assumptions, qualifications and other matters referred to in this opinion and subject to any matters not disclosed to us, we are of the opinion that, so far as the laws of the Relevant Jurisdictions are concerned:

 

(a) Status Gates Engineering & Services Australia Pty Ltd (Australian Guarantor) is registered and validly existing under the laws of the Relevant Jurisdictions.

 

(b) Power and Authority The Australian Guarantor has the corporate power to execute, deliver and perform its obligations under the agreement entitled “Fourth Supplemental Indenture” dated 20 January 2011 between the Australian Guarantor, the Trustee and others (Supplemental Indenture), and the execution, delivery and performance of the Supplemental Indenture by the Australian Guarantor has been duly authorised by all necessary corporate action.

 

(c) Legal, valid and binding The obligations expressed to be imposed on the Australian Guarantor under the Supplemental Indenture are the legal, valid and binding obligations of the Australian Guarantor enforceable against the Australian Guarantor in accordance with its terms.

 

3. BENEFIT

This opinion is given for the sole benefit of the persons to whom the opinion is addressed.

Subject to the following paragraph, this opinion may not be disclosed to anyone else except that it may be disclosed, but only on the express basis that they may not rely on it, to any professional adviser of any persons to whom the opinion is addressed or to any potential transferee of the Notes or to any affiliates of the persons to whom the opinion is addressed (or to any other person to whom payments are to be made by reference to the Indenture) or as required by law, regulation or court proceedings.

This opinion may be disclosed to and relied upon by Latham & Watkins LLP (US special counsel to the Issuers) solely in connection with the issuance of its opinion letter dated on or about the date of this opinion in connection with the Registration Statement for the Issuers with respect to the Notes offered by the Issuers, and any amendments thereto, including any post-effective amendments to be filed by the Issuers.

We consent to the filing of this opinion with the Commission as an exhibit to the Registration Statement by the Issuers and the Note Guarantors.

Yours faithfully

/s/ Allen & Overy

 

2

SCHEDULE 1: DOCUMENTS REVIEWED

We have examined and relied on original or copies, certified or otherwise identified to our satisfaction, of the documents listed below:

 

(a) a PDF copy of the Indenture, in the form executed on 29 September 2010;

 

(b) a PDF copy of the Supplemental Indenture; and

 

(c) a certificate dated 20 January 2011 of the Australian Guarantor, executed by Neil Anthony Ferguson, as the sole director and sole company secretary of the Australian Guarantor, attaching:

 

  (i) the constitution of the Australian Guarantor;

 

  (ii) the Australian Securities & Investments Commission (ASIC) certificate of registration of the Australian Guarantor;

 

  (iii) an extract of resolutions of the board of directors of the Australian Guarantor passed on 10 December 2010; and

 

  (iv) an ASIC Form 2602, Notification of financial assistance details, of the Australian Guarantor dated 5 November 2010.

On 23 June 2011, at approximately 9.30 am, we carried out an online computer search (ASIC Search) of the records at ASIC in respect of the Australian Guarantor. These records are not necessarily up-to-date or complete. We have not reviewed or obtained copies of any documents lodged by the Australian Guarantor with respect to the appointment of any directors or company secretaries of the Australian Guarantor or with respect to any other matter relating to the Australian Guarantor.

Except as stated above we have not examined any contracts, instruments or other documents entered into by or affecting the Australian Guarantor or any corporate records of the Australian Guarantor and have not made any other enquiries or searches (public or otherwise) concerning the Australian Guarantor or any of the assets of the Australian Guarantor.

 

3

SCHEDULE 2: ASSUMPTIONS AND QUALIFICATIONS

 

1. ASSUMPTIONS

In giving this opinion, we have assumed:

 

(a) that the Australian Guarantor is solvent (meaning that it is able to pay all its debts as and when they become due and payable) at the time of, and immediately after, entry into the Supplemental Indenture. We have also assumed that no transaction in connection with the Supplemental Indenture constitutes an “insolvent transaction” or an “unfair loan” within the meaning of section 588FC or 588FD of the Corporations Act 2001 (Cth) (Corporations Act) or an “uncommercial transaction” within the meaning of section 588FB of the Corporations Act or an “unreasonable director related transaction” within the meaning of section 588FDA of the Corporations Act;

 

(b) that no administrator, liquidator, Controller (as defined in the Corporations Act) or similar official has been appointed to the Australian Guarantor or in respect of any of the assets of the Australian Guarantor (and no steps have been taken to appoint any such person, including by passing a resolution or otherwise), and the Australian Guarantor has not obtained any protection from any of its creditors under any law applicable to the Australian Guarantor. The ASIC Search did not disclose any filings in respect of these matters;

 

(c) that each of the assumptions specified in section 129 of the Corporations Act is correct in relation to the Australian Guarantor, the entry by the Australian Guarantor into the Supplemental Indenture and the performance of its obligations under the Supplemental Indenture;

 

(d) that execution of the Supplemental Indenture by the Australian Guarantor occurred in Western Australia;

 

(e) the genuineness of all signatures, seals, dates and markings;

 

(f) the authenticity and completeness of all documents submitted to us as originals;

 

(g) the conformity to original documents of all documents submitted to us as copies (whether photocopies, certified copies, facsimile copies or electronic copies);

 

(h) that the Australian Guarantor entered into the Supplemental Indenture in good faith in the best interests of the Australian Guarantor (or, where permitted under section 187 of the Corporations Act, any holding company of the Australian Guarantor), for a proper purpose and the officers of the Australian Guarantor properly performed all of their duties to the Australian Guarantor in connection with the Supplemental Indenture;

 

(i) that all authorisations, filings, registrations or other requirements of government, judicial or public bodies and authorities required under any law (including any Relevant Law) for any party (other than, under any Relevant Law, the Australian Guarantor) to enter into the Supplemental Indenture or perform any of its obligations under the Supplemental Indenture have been obtained, remain valid and subsisting and have been complied with;

 

(j) the power and authority of each of the parties to the Supplemental Indenture (other than the Australian Guarantor) to execute, and their due execution of, the Supplemental Indenture and that the Supplemental Indenture constitutes a legal, valid and binding obligation, enforceable in accordance with its terms, of each party to it under all laws other than, in the case of the Australian Guarantor, the Relevant Laws;

 

4

(k) that the certificates and other documents to which we have referred in this opinion, including the certificate referred to in paragraph (b) of Schedule 1 (and the factual statements in such certificates or documents) remain accurate and that there have been no variations to any such certificates or documents;

 

(l) that each resolution described in the extracts of resolutions referred to in paragraph (b) of Schedule 1 above was duly passed by the director of the Australian Guarantor and nothing has occurred which would bring into doubt the validity of any resolution for any reason, including as a result of any breach of director’s duties, lack of quorum or for any other reason;

 

(m) that no party has contravened or will contravene section 260A or Chapter 2E of the Corporations Act by entering into the Supplemental Indenture or by giving effect to a transaction in connection with the Supplemental Indenture;

 

(n) that if an obligation under the Supplemental Indenture is required to be performed in any jurisdiction other than a Relevant Jurisdiction, the performance of that obligation will not be illegal or unenforceable under the laws of that jurisdiction;

 

(o) that no party to the Supplemental Indenture has engaged or will engage in fraud, misleading, deceptive or unconscionable conduct, the Supplemental Indenture represents the intention of the parties to it and no party has been or will be involved in or a party to any activity or transaction not evident on the face of the Supplemental Indenture which might render the Supplemental Indenture or any related transaction or activity in breach of law, void, voidable or unenforceable;

 

(p) that no party to the Supplemental Indenture (other than the Australian Guarantor) has repudiated its obligations under the Supplemental Indenture or purported to do so, no party to the Supplemental Indenture has accepted the repudiation or termination by any other party of that party's obligations under the Supplemental Indenture and that the Supplemental Indenture has not been amended, supplemented, released, discharged or terminated since the time of its execution;

 

(q) the Australian Guarantor does not enter into the Supplemental Indenture as the trustee of a trust or partner of a partnership;

 

(r) no party to the Supplemental Indenture is a “retail client” as defined in the Corporations Act in respect of the provision of any financial service to that party under the Supplemental Indenture and each party who carries on a financial services business in Australia and who provides financial services in connection with the Supplemental Indenture either:

 

  (i) holds an Australian financial services licence under the Corporations Act covering the provision of those services and is complying with that licence; or

 

  (ii) is exempted from holding such a licence under the Corporations Act;

 

(s) the Code of Banking Practice does not apply to the Supplemental Indenture; and

 

(t) each supplemental indenture referred to in the definition of Indenture in this opinion is, other than with respect to the parties, in substantially the same form as the Supplemental Indenture.

We have assumed that any law other than a Relevant Law which may apply with respect to the transactions and matters contemplated by the Supplemental Indenture would not affect any of the conclusions stated in this opinion and we express no opinion on the law of any jurisdiction other than the Relevant Jurisdictions. We express no opinion on any pending legislative change in any Relevant Jurisdiction or any pending decision of a court in any Relevant Jurisdiction. We express no opinion as to matters of fact.

 

5

We have not taken any action to verify any of the assumptions above other than conducting the ASIC Search. However, the Allen & Overy partner and lawyer in our Australian offices primarily responsible for this matter (namely Angela Flannery and Xi Yang) have no actual knowledge that these assumptions are incorrect.

 

2. QUALIFICATIONS

This opinion is subject to the following qualifications:

 

(a) This opinion is subject to all insolvency, bankruptcy, liquidation, receivership, administration, moratorium, reorganisation and other laws affecting the rights of creditors (including secured creditors) generally.

 

(b) We express no opinion as to the exact interpretation which would be placed on any particular wording in the Supplemental Indenture by a court of a Relevant Jurisdiction, provided this does not affect our opinion in paragraph 2(c).

 

(c) Clauses providing for interest to be paid on overdue amounts may amount, at least in part, to a penalty under the laws of the Relevant Jurisdictions and may not be enforceable.

 

(d) A court of a Relevant Jurisdiction may stay proceedings if concurrent proceedings are being brought elsewhere.

 

(e) There could be circumstances in which a court of a Relevant Jurisdiction would not treat as conclusive those certificates, calculations and determinations which the Supplemental Indenture state are to be so treated.

 

(f) The effectiveness of terms exculpating a party from a liability or duty otherwise owed (including liability arising out of the non-payment of stamp duty) is limited by law.

 

(g) Any clause or term of the Supplemental Indenture which purports to sever a provision of the Supplemental Indenture may not be effective as a court of a Relevant Jurisdiction may determine itself whether any provision is severable.

 

(h) A court of a Relevant Jurisdiction may, in its discretion, determine the enforceability of:

 

  (i) a provision requiring written waivers and amendments (to the exclusion of oral waivers and amendments, or amendments and waivers effected in another way, including by conduct); or

 

  (ii) any obligation to negotiate in good faith.

 

(i) The use of the term “enforceable” in relation to a document means that document is of a type and form ordinarily enforced by the courts of the Relevant Jurisdictions. It does not mean that each obligation will be enforced in accordance with its terms. Certain rights and obligations may be qualified by the non-conclusivity of certificates, doctrines of good faith and fair conduct, statutory prohibitions of misleading, deceptive or unconscionable conduct and other matters.

 

(j) Equitable remedies such as specific performance or the issue of an injunction are available only at the discretion of the court. Specific performance is not usually granted, and an injunction is not usually issued, where damages would be an adequate alternative.

 

(k) Enforcement in a court of a Relevant Jurisdiction of the Supplemental Indenture is also subject to:

 

6

  (i) claims becoming barred under statutes imposing limited periods within which proceedings may be brought;

 

  (ii) the general common law doctrines of estoppel in relation to representations, acts or omissions of creditors and of frustration;

 

  (iii) defences of set-off, abatement and counterclaim; and

 

  (iv) the requirement that any discretion be exercised reasonably and that any determination of a matter in a party’s opinion be based on reasonable grounds.

 

(l) We express no opinion as to any provision of the Supplemental Indenture to the extent it purports to declare or impose a trust in respect of any payments or assets received by any person.

 

(m) We express no opinion as to whether a monetary judgment would be given in a court of a Relevant Jurisdiction in a currency other than Australian dollars or the enforceability of any currency indemnity.

 

(n) A court of a Relevant Jurisdiction will not give effect to a choice of law in the Supplemental Indenture if it would be contrary to public policy to do so.

 

(o) The courts of the Relevant Jurisdictions do not necessarily give full effect to an indemnity for legal costs or the costs of litigation and may award costs, even as against a successful party.

 

(p) Laws and regulations in Australia prohibit or restrict dealings with the assets of persons and entities considered to be associated with terrorism and any transactions with, or on behalf of, those persons and entities and restrict certain payments to, or transactions in relation to, a person or entity against whom the Commonwealth of Australia has imposed economic, political or other international sanctions.

 

(q) We express no opinion as to the accuracy or relevance of any representation, warranty or other statement in the Supplemental Indenture.

 

(r) The Commissioner of Taxation has power to require a deduction from any payment to any party under the Supplemental Indenture of an amount in respect of that party’s Australian tax related liabilities. In addition, withholding tax may be withheld from payments to non-Australian residents or residents carrying on a business on, at or through a permanent establishment outside Australia or that do not provide a tax file number or Australian Business Number, in any case, under the Supplemental Indenture.

 

(s) We express no opinion as to whether goods and services tax is payable in connection with the Supplemental Indenture or whether any tax is required to be withheld, deducted or paid by any party to the Supplemental Indenture.

 

(t) An undertaking to assume liability for, or to provide an indemnity in respect of a breach of law or other matter may not be enforceable if enforcement would be contrary to public policy.

 

(u) The courts of the Relevant Jurisdictions have a discretion to refuse to exercise jurisdiction in certain circumstances, including where the court determines that there is a more appropriate forum or that any orders it makes may not be effective.

 

7

EX-5.9 28 dex59.htm EXHIBIT 5.9 Exhibit 5.9

Exhibit 5.9

 

      DLA Piper UK LLP
     

Louizalaan 106

1050 Brussels

Belgium

      T +32 (0)2 500 15 09
      F +32 (0)2 500 65 49
      W www.dlapiper.com

 

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, Colorado 80202

United States

     

Your reference

 

  Our reference

MVB/MVB/203989/1

 

  BEM/1391004.1

   
    

 

24 June 2011

   

Dear Madam / Sir,

 

Re:    Legal opinion in relation to the capacity of Gates Power Transmission Europe BVBA, a private limited liability company incorporated under the laws of Belgium (“besloten vennootschap met beperkte aansprakelijkheid” / “société privée à responsabilité limitée”), with registered office at Dr. Carlierlaan 30, B-9320 Erembodegem, Belgium, and with registration number 0877.356.090 (Register of Legal Entities Dendermonde) (the “Company”) to enter into the Indenture, as defined herein).

 

We have acted as special Belgian legal counsel to the Addressee and have been asked to provide this legal opinion (the “Opinion Letter”) (i) in connection with the issuance of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) by Tomkins, Inc. (formerly Pinafore, Inc.) and the Addressee (formerly, Tomkins, LLC) and the guarantees of the Notes (the “Guarantees”) by the Companies named therein under an indenture dated as of 29 September 2010, as supplemented by the First Supplemental Indenture dated as of 18 November 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of 23 December 2010, the Fourth Supplemental Indenture dated as of 20 January 2011, the Fifth Supplemental Indenture dated as of 23 February 2011, the Sixth Supplemental Indenture dated as of 24 February 2011 and the Seventh Supplemental Indenture dated as of 3 March 2011 (collectively, the “Indenture”) entered into among the Issuers (as defined therein), the Guarantors named therein, and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent, and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended (the “Act”), filed with the US Securities and Exchange Commission (the “Commission”) on 24 June 2011 (the “Registration Statement”) and (ii) in particular, in relation to the capacity of the Company to accede to the Indenture as New Guarantor, by entering into a supplemental indenture N°. 3 dated 23 December 2010 with, amongst others, the Trustee (the “Third Supplemental Indenture”).

   

DLA Piper UK LLP is regulated by the ‘Ordre des avocats à la Cour de cassation’ of Belgium, the ‘Ordre français des avocats’ of the Brussels Bar, the ‘Nederlandse Orde van Advocaten’ of the Brussels Bar and the ‘Orde van Advocaten’ of the Antwerp Bar.

 

DLA Piper UK LLP is a limited liability partnership registered in England and Wales (number OC307847) which is part of DLA Piper, a global law firm, operating through various separate and distinct legal entitles.

 

A list of members is open for inspection at its registered office and principal place of business, 3 Noble Street, London. EC2V 7EE and at the address at the top of this letter.

 

Partner denotes member of a limited liability partnership or a lawyer with equivalent standing or qualifications. If the symbol * is marked next to the name of the signatory to this letter it means he or she provides services to DLA Piper UK LLP through a civil company under the form of a personal liability company.

 

A list of offices and regulatory information can be found at www.dlapiper.com

 

Brussels switchboard:

+32(0)2 500 1500

1. Scope of the Opinion Letter

As Belgian legal counsel, we are only competent to render opinions on issues of Belgian law.

24 June 2011

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BEM/1391004.1

Continuation 2

 

This Opinion Letter is limited to Belgian law at the date of this opinion as currently applied by the Belgian courts. We have made no investigation of, and do not express or imply any views or opinions on the laws of any country other than Belgium. We will not take into account any new or retroactive legislation which, when introduced, may in any way affect or prejudice any opinion in this Opinion Letter.

This Opinion Letter is given on the basis that it will be governed by and construed in accordance with Belgian law. Belgian courts have exclusive jurisdiction with respect to this Opinion Letter.

In this Opinion Letter, all terms or expressions used with a capital letter shall have the same meaning as ascribed to them under the Third Supplemental Indenture.

This opinion is given to you in connection with a scanned copy of the Third Supplemental Indenture, executed by the Company.

For the purpose of rendering this opinion, but without opining upon these documents, we have also examined the parts directly related to the Third Supplemental Indenture of the documents referred to in Schedule 1 to this Opinion Letter (the “Corporate Documents”).

We have not reviewed any other documents than the Third Supplemental Indenture and the Corporate Documents, and we have made no other enquiries, save as expressly stated in the Opinion Letter.

2. Assumptions

We have assumed and not verified, to the extent relevant to each of the opinions given herein below:

 

(i) the genuineness of all signatures and stamps;

 

(ii) the authenticity of all documents submitted to us as originals;

 

(iii) the completeness and conformity to original documents of all copies and/or other specimen documents submitted to us;

 

(iv) the completeness, accuracy and conformity to original documents in form and in substance of all translations of documents, whether or not provided for convenience purposes or official translations;

 

(v) that all the search results from public records, obtained by electronic data transmission or otherwise, are true, accurate, complete and fully reliable;

 

(vi) that all consents, approvals, authorisations, or orders required from any governmental or other regulatory authorities outside Belgium and all other requirements for the legality, validity and enforceability of the Indenture and the Third Supplemental Indenture have been duly obtained or fulfilled and are and will remain in full force;

24 June 2011

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BEM/1391004.1

Continuation 3

 

(vii) that there are no matters under the laws or regulations of any jurisdiction, other than Belgium, which are inconsistent with, or which would render incorrect, or which would otherwise affect the opinions given in this Opinion Letter;

 

(viii) that the Company has not been declared bankrupt, has not filed with the relevant commercial court a petition for its judicial reorganization on the basis of the law of 31 January 2009 on the continuity of enterprises (“wet van 31 januari 2009 betreffende de continuiteit van ondernemingen” / “loi du 31 janvier 2009 relative à la continuité des entreprises”) or has not been subjected to any other insolvency proceedings listed in Annex A of Council Regulation (EC) No. 1346/2000 of 29 May 2000 on insolvency proceedings (although not constituting conclusive evidence thereof, this assumption is supported by the Certificate of Non-Insolvency (as defined in Schedule 1 to this Opinion Letter) and by our search on the date hereof on the website of the Belgian State Gazette (“Belgisch Staatsblad”/ “Moniteur Belge”);

 

(ix) that the Company has not been dissolved, merged or split up (although not constituting conclusive evidence thereof, this assumption is supported by our search on the date hereof on the website of the Belgian State Gazette (“Belgisch Staatsblad”/ “Moniteur Belge”) on the date hereof);

 

(x) that the information recorded in the Co-ordinated Articles of Association of the Company as submitted to us is currently correct and that there have been no amendments to the same (although not constituting conclusive evidence thereof, our search on the website of the Belgian State Gazette (“Belgisch Staatsblad”/ “Moniteur Belge”) on the date hereof has not produced any indication to the contrary);

 

(xi) that the meetings of the Board of Managers of the Company are held in Belgium and that, accordingly, the actual management of the Company is located in Belgium, since the date of its incorporation;

 

(xii) that on the date of execution of the Third Supplemental Indenture, Mr. William Patrick Allen, Mr. Piergiorgio Brusco and Mr Peter Verdonckt were still members of the Board of Managers of the Company, and that on this date there were no other members of its Board of Managers (although not constituting conclusive evidence thereof, our search on the website of the Belgian State Gazette (“Belgisch Staatsblad”/ “Moniteur Belge”) on the date hereof has not produced any indication to the contrary);

 

(xiii) that the Board Minutes truly and accurately reflect what was discussed and resolved at the meeting of the Board of Managers and that the meeting of the Board of Managers of the Company was effectively conducted as a meeting with deliberations, the contents of which are duly reflected in the Board Minutes, and that the resolutions passed at such meeting were duly adopted, have not been revoked or varied and remain in full force and effect as of the date hereof;

24 June 2011

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Continuation 4

 

(xiv) that the managers of the Company do not have a conflict of interest in connection with the execution of the Third Supplemental Indenture or any of the transactions contemplated thereunder, that would preclude them from validly exercising their mandate and validly representing the Company;

 

(xv) that the entry into the Third Supplemental Indenture is in the best interest of the Company (as determined by its Board of Managers) and that the Third Supplemental Indenture is entered into for bona fide commercial purposes, without any fraudulent intent (including as to the interests of creditors) and at arms’ length conditions and that the parties to the Third Supplemental Indenture in their conduct have complied with the requirement of good faith and fair dealing and that their conduct has not infringed public policy or moral standards;

 

(xvi) that the Third Supplemental Indenture has been executed by duly authorised representatives of each party thereto other than the Company and the authorised signatories of each such party had, at the time of executing, full legal power and capacity to execute the Third Supplemental Indenture in the name and on behalf of each such other party;

 

(xvii) that the Third Supplemental Indenture constitutes the legal, valid and binding obligations of the parties thereto under its governing law, and is enforceable against those parties in accordance with its terms under all applicable laws of any relevant jurisdiction;

 

(xviii) that there are no dealings, agreements or arrangements, actions or events between, by or involving any of the parties to the Third Supplemental Indenture which modify or supersede any of the terms of the Third Supplemental Indenture, or which otherwise affect the opinions given in this Opinion Letter;

 

(xix) that the representations, warranties and statements given by the parties in the Third Supplemental Indenture are true and accurate in all respects at the date of entry into the Third Supplemental Indenture and at the date of this Opinion Letter; and

 

(xx) no obligations incurred by the Company pursuant to the Third Supplemental Indenture have been or will be incurred to finance or refinance in whole or in part, directly or indirectly, an acquisition of or subscription of any shares in the Company in breach of Article 329 of the Belgian Company Code.

3. Opinions

Subject to (i) the assumptions, qualifications, reservations and limitations as mentioned herein, (ii) any factual matters not disclosed to us in the course of our investigations and without expressing any opinion as to matters or documents other than the Indenture (including the guarantee of the Notes contained therein), we are of the following opinion on the date hereof:

24 June 2011

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BEM/1391004.1

Continuation 5

 

1. the Company is a company duly incorporated and validly existing as a “besloten vennootschap met beperkte aansprakelijkheid” / “société privée à responsabilité limitée” under the laws of Belgium;

 

2. the Company had all necessary corporate power to execute the Indenture;

 

3. the persons named as authorised persons with respect to Company had the right, power and authority to execute the Indenture on behalf of the Company and to give any notices or certificates under the Indenture on the Company’s behalf, in accordance with the power of attorney granted by the Board of Managers in the Board Minutes; and

 

4. all authorisations required or advisable in Belgium in connection with the execution and performance by the Company of the Indenture have been obtained or effected (as appropriate) and are in full force and effect;

4. Qualifications and reservations

The opinions expressed in this Opinion Letter are subject to the following qualifications and reservations:

 

1. We express no opinion as to matters of fact, nor as to questions of law which can be decided only on the basis of matters of fact nor as to the effect of facts, whether known to us or not, that may have an effect on the opinion given herein.

 

2. In principle, a power of attorney or agency can be revoked by the principal at any time without prior notice or justification. A power of attorney or agency can however be made irrevocable, provided that it is limited in time. A termination of an irrevocable power of attorney or agency can give rise to damages. Any appointment of an attorney or agent may be limited in circumstances of conflict of interest between the principal and the attorney-in-fact or agent and terminates in principle without retroactive effect upon bankruptcy or liquidation of the principal.

 

3. The opinions expressed in this Opinion Letter may be affected or limited by the provisions of any applicable bankruptcy, insolvency, fraudulent conveyance, reorganisation, suspension of payments and other or similar laws of any jurisdiction and of general application now or hereafter in effect, relating to or affecting the enforcement or protection of creditors’ rights generally, including but not limited to the Belgian Bankruptcy Law and the law of 31 January 2009 on the continuity of enterprises (“wet van 31 januari 2009 betreffende de continuiteit van ondernemingen”/ “loi du 31 janvier 2009 relative à la continuité des entreprises”).

 

4.

Under Belgian law, each company is subject to the so-called corporate speciality principle (“principe de spécialité”/ “specialiteitsbeginsel”), which requires it to pursue the generation of profit and prevents it from entering into any transactions which are not directly or indirectly beneficial to it. If the

24 June 2011

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BEM/1391004.1

Continuation 6

 

undertakings made by a company cannot be demonstrated to be to its advantage or if the undertakings can be deemed to be mere gifts without any actual and demonstrable advantage for a company, then the same may be held to be null and void.

5. Limitations

This Opinion Letter is addressed to you at your explicit request and may only be relied upon by you in connection with the transactions to which the Third Supplemental Indenture relates.

 

1. This Opinion Letter is strictly limited to the matters addressed herein and is not to be used or extended by implication to any other matter, whether in connection with the Third Supplemental Indenture or otherwise.

With the exclusion of the matters as to which we are expressing an opinion in section 3 of this Opinion Letter, this Opinion Letter should not be construed as expressing any opinion on the completion, accuracy and correctness of any of the representations and warranties or any other information given by the parties in the Third Supplemental Indenture. In particular, we do not express any opinion as to (i) any matters of fact, (ii) the validity and enforceability of the Third Supplemental Indenture under any applicable laws, (iii) the accounting treatment of the transactions contemplated by the Third Supplemental Indenture and (iv) any matters of direct or indirect taxation.

 

2. There is no intention on our part to amend or update this Opinion Letter in the event of changes after the date hereof in any Belgian laws, existing case law or regulations relevant to the opinions given in this Opinion Letter.

 

3. In this Opinion Letter, Belgian legal concepts are expressed in English terms and not in their original Dutch or French terms used in Belgian laws. The concepts concerned may not be identical to the concepts described by the same English terms as they exist under the laws of other jurisdictions. This opinion may, therefore, only be relied upon under the express condition that any issues of interpretation arising there under be governed by Belgian law and be brought before a court in Belgium.

This opinion is given for the benefit of the persons to whom it is addressed in their respective capacities as stated. It may not be relied on by or distributed or disclosed to any other person. This opinion may however be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the registration statement on Form F-4 for Tomkins, Inc. and Tomkins, LLC with respect to the notes offered by Tomkins, Inc. and Tomkins, LLC, and any amendments thereto, including any post-effective amendments to be filed by Tomkins, Inc. and Tomkins, LLC. Moreover, we hereby consent to the filling of this opinion with the U.S. Securities Exchange Commission as an exhibit to the registration statement on Form F-4 and to the reference to this firm under the caption “Legal Matters” in the prospectus which forms a part thereof.

The liability of the issuer of this opinion in connection with its contents is limited in the aggregate to the maximum cover under the professional indemnity insurance of

24 June 2011

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BEM/1391004.1

Continuation 7

 

the issuer that is available in connection with this opinion at the time any payment under a claim is to be made.

This opinion is given by DLA Piper UK LLP and not on behalf of any other offices or any other firms associated with us.

 

Yours sincerely,
/s/ Dirk Caestecker
Dirk Caestecker*
Partner

DLA PIPER UK LLP

dirk.caestecker@dlapiper.com

Schedule 1 – Corporate Documents

24 June 2011

MVB/MVB/203989/1

BEM/1391004.1

Continuation 8

 

Schedule 1

Corporate Documents

 

(a) Copy of the latest co-ordinated articles of association of the Company, dated 3 December 2010 (the “Co-ordinated Articles of Association”);

 

(b) A list of all publications in the Annexes to the Belgian Official Gazette during the last five years in respect of the Company until the date hereof;

 

(c) Copy of the minutes of the meeting of the Board of Managers of the Company, dated 21 December 2010 (the “Board Minutes”);

 

(d) An excerpt dated 22 June 2011 from the Crossroads Bank for Enterprises (“Kruispuntbank van Ondernemingen” / “Banque-Carrefour des Entreprises”) confirming that the Company (i) has been duly registered and (ii) has not been put into liquidation on the date thereof; and

 

(e) Written confirmation dated 20 June 2011 from the Clerk’s office of the Dendermonde Commercial Court confirming that the Company has not been declared bankrupt or has not filed with the Dendermonde Commercial Court a petition for its judicial reorganization on the basis of the law of 31 January 2009 on the continuity of enterprises (“wet van 31 januari 2009 betreffende de continuiteit van ondernemingen” / “loi du 31 janvier 2009 relative à la continuité des entreprises”) (the “Certificate of Non-Insolvency”).
EX-5.10 29 dex510.htm EXHIBIT 5.10 Exhibit 5.10

Exhibit 5.10

[Pinheiro Neto Guilherme Leite Letterhead]

São Paulo, June 24, 2011

To:

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street,

Denver, CO 80202

 

Re.: Guarantees by Schrader Brazil

Dear Sirs,

1. We have acted as special Brazilian counsel in connection with the issuance of US$1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) by Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly Pinafore, LLC) and the guarantees of the Notes (the “Guarantees”) by the Note Guarantors (as named in the Indenture) under an Indenture dated as of September 29, 2010, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, and including the 9% Senior Secured Second Lien Notes due 2018, the “Indenture”) entered into among the Issuers, the Note Guarantors named therein, and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent, and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended, filed with the Securities and Exchange Commission on June 24, 2011.

1.1. Our legal advice was provided pursuant to the laws of the Federative Republic of Brazil (“Brazil”), as the Indenture was secured by a Brazilian security package composed of (i) the fiduciary sale of all quotas issued by Schrader International Brasil Ltda.

(“Schrader Brasil”) (“Quota Fiduciary Sale”), and (ii) the pledge of rights related to certain bank accounts held by Schrader Brazil (“Pledge of Rights”), as security for the performance of the Secured Obligations, as defined in the Quota Fiduciary Sale and the Pledge of Rights (the Quota Fiduciary Sale and the Pledge of Rights are collectively referred to as the “Security”).

2. In connection therewith, we have examined the following documents:

(i) an executed copy of the Indenture;

(ii) an executed copy of the Quota Fiduciary Sale Agreement, dated February 24, 2011, and duly registered with the Registry of Deeds and Documents of the City of Jacareí under nº 053301;

(iii) an executed copy of the Agreement for Pledge of Rights, dated February 24, 2011, and duly registered with the Registry of Deeds and Documents of the City of Jacareí under nº 053302;

(iv) a copy of the officer’s certificate of Schrader Brasil, dated March 18, 2011, signed by Mr. Richard Hoffner and duly notarized at the competent Registry Office in Brazil;

(v) a copy of the 9th amendment to the articles of association (Contrato Social) of Schrader Brasil, dated December 17, 2010, and duly registered with the Board of Trade of the State of São Paulo under nº 458.772/10-0;

(vi) a copy of the 10th amendment to the articles of association (Contrato Social) of Schrader Brasil, dated March 18, 2011, and duly registered with the Board of Trade of the State of São Paulo under nº 122.600/11-3;

(vii) a copy of the Partners’ Resolutions of Schrader Brasil held on February 8, 2011, and duly registered with the Board of Trade of the State of São Paulo under nº 74.797/11-6; and

(viii) a copy of the Partners’ Resolutions of Schrader Brasil held on February 8, 2011, and duly registered with the Board of Trade of the State of São Paulo under nº 74.798/11-0.

 

2

In this opinion, the documents listed in items (i) to (vii) above are jointly referred to as the “Transaction Documents”.

3. For the purpose of this opinion, we have assumed other than with respect to documents signed by Schrader Brasil (a) the genuineness of all signatures and the authenticity of all documents submitted to us as originals or photocopies or execution copies thereof, (b) the legal capacity of all natural persons, and (c) the validity, enforceability and performance of the obligations of the Transaction Documents and the transactions contemplated thereby under the laws to which they are expressed to be governed. We have also reviewed such matters of law as we have considered relevant for the purpose of this opinion. This opinion is based solely on the documents provided to us.

4. Unless the context shall otherwise require or except as otherwise expressly provided herein, terms defined and expressions used herein shall have the same respective meanings assigned to them in the Transaction Documents.

5. We express no opinion as to any law other than the laws of Brazil and we have assumed that there is nothing in any other law that affects our opinion. In particular, we have made no independent investigation of any foreign law as a basis for the opinions stated herein and do not express or imply any opinion on such laws. We are qualified to practice in Brazil, and the opinions stated herein relate only to the laws of Brazil as in force at the date hereof.

6. Based on the foregoing, it is our opinion that:

6.1. Schrader Brasil has been duly incorporated and is validly existing under the laws of Brazil, with power and authority (i) to carry on its activities, (ii) to enter into the Indenture, and (iii) perform its obligations in connection with the Indenture.

6.2. Schrader Brasil has (i) all necessary corporate power and authority to execute and deliver, and perform its obligations under, the Indenture, (ii) taken all corporate action required to authorize the execution and delivery of, and the performance of its obligations, under the Indenture, and (iii) duly executed and delivered the Indenture.

 

3

6.3. The Indenture constitutes a legal, valid and binding obligation of Schrader Brasil, enforceable against it in accordance with its terms.

7. The opinions set forth above are, however, subject to certain reservations, namely:

(i) enforcement of the obligations of Schrader Brasil may be limited by insolvency, moratorium, fraudulent conveyance, bankruptcy and reorganization or other laws of general application relating to or affecting the rights of creditors and to general equity principles;

(ii) in case of insolvency, moratorium, fraudulent conveyance, bankruptcy and/or judicial or extrajudicial reorganization of Schrader Brasil, certain credits, such as post-petition and super-priority claims, motions for restitution, and credits for salaries and wages (subject to applicable cap and limitations) shall have preference over other credits, including secured ones , as applicable; and

(iii) in case of proceedings instituted against Schrader Brasil in Brazil, certain court costs and deposits to guarantee judgment might be due.

8. We express no opinion as to any agreement, instrument or other document other than as specified in this letter.

9. This opinion shall be governed by and construed in accordance with the laws of Brazil in effect as of the date hereof.

10. This opinion is addressed to you solely for your benefit in connection with the transaction contemplated in paragraph 1 above and shall not be transferred to anyone else nor is it to be relied upon by anyone else or for any other purpose or quoted or referred to in any public document or filed with anyone without our prior written consent, except as specified hereafter. This opinion may however be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the registration statement on Form F-4 for Tomkins, Inc. and Tomkins, LLC with respect to the notes offered by Tomkins, Inc. and Tomkins, LLC, and any amendments thereto, including any post-effective amendments to be filed by Tomkins, Inc. and Tomkins, LLC. Moreover, we hereby consent to the filling of this opinion with the U.S Securities Exchange Commission as an exhibit to the registration statement on Form F-4.

 

4

11. This opinion speaks only as of the date hereof. We expressly disclaim any responsibility to advise you or any other person who is permitted to rely on the opinions expressed herein as specified above of any development or circumstance of any kind including any change of law or fact that may occur after the date of this letter even though such development, circumstance or change may affect any legal analysis, legal conclusion or any other matter set forth in or relating to this letter.

 

    Very truly yours,
  Pinheiro Neto Advogados
By  

/s/ Pinheiro Neto Advogados

 

5

EX-5.11 30 dex511.htm EXHIBIT 5.11 Exhibit 5.11

Exhibit 5.11

[Walkers Letterhead]

 

24 June 2011   Our Ref: SP/L04282

Tomkins Inc and Tomkins LLC

155 Wewatta Street

Denver, Colorado 80202

United States of America

Dear Sirs

GATES FLEXIMAK LIMITED

GATES ENGINEERING & SERVICES LIMITED

(each a “Company”, together, the “Companies”)

We have acted as your British Virgin Islands counsel in connection with the Registration Statement on Form F-4 to which this opinion has been filed as an exhibit (the “Registration Statement”). The Registration Statement relates to the proposed issuance and exchange (the “Exchange Offer”) of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Exchange Notes”) of Tomkins, Inc., a Delaware corporation, and Tomkins, LLC, a Delaware limited liability company, (collectively, the “Issuers”), for an equal principal amount of outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Initial Second Lien Notes”) of the Issuers, and the guarantees of the Exchange Notes (the “Guarantees”) by, among other entities, the Companies pursuant to the Indenture referred to below. The Initial Second Lien Notes have been and the Exchange Notes will be issued pursuant to an indenture dated 29 September 2010 between the Issuers, the Companies and Wilmington Trust FSB, as trustee (the “Trustee”), among other parties, as supplemented by the First Supplemental Indenture dated 18 November 2010, the Second Supplemental Indenture dated 21 December 2010 (by which the Companies acceded to the obligations under the Indenture as guarantors) (the “Second Indenture”), the Third Supplemental Indenture dated 23 December 2010, the Fourth Supplemental Indenture dated 20 January 2011, the Fifth Supplemental Indenture dated 23 February 2011, the Sixth Supplemental Indenture dated 24 February 2011 and the Seventh Supplemental Indenture dated 3 March 2011 (collectively, the “Indenture”).

In connection with this opinion, we have (i) investigated such questions of law, (ii) examined originals or certified, conformed or reproduction copies of such agreements, instruments, documents and records of the Companies, such certificates of public officials and such other documents and (iii) received such information from officers and representatives of the Companies and others, in each case, as we have deemed necessary or appropriate for the purposes of this opinion. We have examined, among other documents, the following:

 

(a) the Second Indenture, the Indenture and the Guarantees contained therein; and

(b) the form of Exchange Notes attached to the Indenture as an Exhibit.

In all such examinations, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of original and certified documents and the conformity to original or certified documents of all copies submitted to us as conformed or reproduction copies.

Based upon the foregoing and subject to the limitations, qualifications and assumptions set forth herein, we are of the opinion that:

 

1. Each of the Companies is a company duly incorporated under the BVI Business Companies Act, 2004, validly exists as a BVI Business Company and is in good standing under the laws of the British Virgin Islands.

 

2. Each of the Companies has duly authorised and executed the Second Indenture and has the necessary corporate power to guarantee the Exchange Notes pursuant to the terms of the Indenture and the Second Indenture.

The opinions expressed herein with respect to the existence and/or good standing of the Companies are based solely on certificates of public officials as to factual matters and legal conclusions set forth therein.

The opinions set forth above are subject to (i) applicable bankruptcy, insolvency, moratorium, reorganisation, fraudulent conveyance and other similar laws now or hereafter in effect relating to or affecting creditors’ rights and remedies generally, and (ii) general principles of equity including, without limitation, standards of materiality, good faith, fair dealing and reasonableness, equitable defences and limits as to the availability of equitable remedies, whether such principles are considered in a proceeding at law or in equity.

For purposes of the opinions expressed herein, we assume for purposes of this opinion that the each of the other parties to the Indenture (other than the Companies) is duly organised, validly existing and in good standing under the laws of its jurisdiction of organisation; that each such party is duly qualified to engage in the activities contemplated by the Indenture; that the Indenture has been duly authorised, executed and delivered by each such party and constitutes the legally valid, binding and enforceable obligation of each such party enforceable against each such party in accordance with its terms; that the Trustee is in compliance, generally and with respect to acting as a trustee under the Indenture, with all applicable laws and regulations; and that the Trustee has the requisite organisational and legal power and authority to perform its obligations under the Indenture.

The opinions expressed herein are limited to the laws of the British Virgin Islands. The opinions expressed herein are limited to the matters stated herein, and no opinion is implied or may be inferred beyond the matters expressly stated herein. The opinions expressed herein are given as of the date of effectiveness of the Registration Statement, and we undertake no obligation to supplement this letter if any applicable laws change after that date or if we become aware of any facts that might change the opinions expressed herein after that date or for any other reason.

This opinion is made for the benefit of and may be relied upon by the addressees thereof. This opinion also may be relied upon by Latham & Watkins LLP in connection with the issuance of its opinion letter in connection with the Registration Statement, and any

amendments thereto, including any post-effective amendments to be filed by Tomkins, Inc. and Tomkins, LLC with the Securities and Exchange Commission under the Securities Act of 1933, as amended. Moreover, we hereby consent to the filling of this opinion with the U.S Securities Exchange Commission as an exhibit to the Registration Statement and to the reference to this firm under the caption “Legal Matters” in the prospectus which forms a part thereof.

Yours faithfully

/s/ Walkers

WALKERS

EX-5.12 31 dex512.htm EXHIBIT 5.12 Exhibit 5.12

Exhibit 5.12

[Davies Ward Phillips & Vineberg LLP Letterhead]

June 24, 2011

File No.: 235611

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, Colorado 80202

Dear Sirs/Mesdames:

Re: ACD Tridon Inc., Ruskin Company Canada Inc. and Tomkins Automotive Canada Limited – Guarantee and Indenture

We have acted as special Ontario counsel to ACD Tridon Inc. (“ACD”), Ruskin Company Canada Inc. (“Ruskin”) and Tomkins Automotive Canada Limited (“Tomkins” and collectively with ACD and Ruskin, the “Canadian Grantors”) in connection with an indenture dated as at September 29, 2010 (the “Indenture”) among Tomkins, LLC (formerly known as Pinafore, LLC) and Tomkins, Inc. (formerly known as Pinafore, Inc.) (collectively, the “Issuers”), Pinafore Holdings, B.V. (“Holdings”), Wilmington Trust FSB (“Wilmington”), as trustee and collateral agent (the “Collateral Agent”) and the other parties thereto, as supplemented by the first supplemental indenture dated as of November 18, 2010 (the “First Supplemental Indenture”) between the Canadian Grantors, the Issuers and the Collateral Agent pursuant to which, among other things, the Canadian Grantors each became a party to the Indenture and provided a guarantee of the Issuers’ obligations under the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Securities”) and, by the second supplemental indenture dated as of December 21, 2010, the third supplemental indenture dated as of December 23, 2010, the fourth supplemental indenture dated as of January 20, 2011, the fifth supplemental indenture dated as of February 23, 2011, the sixth supplemental indenture dated as of February 24, 2011 and the seventh supplemental indenture dated as of March 3, 2011 (collectively, the “Subsequent Supplemental Indentures”).

In such capacity, we have received a copy of the Indenture and the First Supplemental Indenture.

We do not regularly act as counsel to the Canadian Grantors, nor have we participated in the general maintenance of, nor conducted any review of, their corporate records and corporate proceedings. Therefore, in expressing certain of the opinions below, we have relied exclusively on a certificate of an authorized signatory of each of the Canadian Grantors certifying what purport to be true and accurate copies of each of the Canadian Grantors’ constating documents and by-laws, as well as a copy of the resolutions passed by the respective boards of directors in connection with the transactions referred to herein, as well as certificates of public officials and others and originals, copies or facsimiles of such other agreements, instruments, certificates and documents as we have deemed necessary or advisable as a basis for

Page 2

 

the opinions expressed below. In particular, as to certain matters of fact relevant to the opinions expressed below, we have relied on certificates of an authorized signatory of each of the Canadian Grantors (the “Officer’s Certificates”) dated the date hereof and dated November 18, 2010, without making any independent verification or inquiry.

For the purposes of our opinion expressed in paragraph 1 below as to the existence of Ruskin, we have relied solely on a certificate of compliance dated June 23, 2011, issued by the Director or a Deputy Director appointed under the Canada Business Corporations Act (“CBCA”) in respect of Ruskin, without any independent verification or inquiry. For the purposes of our opinion expressed in paragraph 2 below as to the existence of ACD and Tomkins, we have relied solely on certificates of status dated June 23, 2011, issued by the Ontario Ministry of Government Services in respect of each of ACD and Tomkins, without any independent verification or inquiry.

For the purposes of the opinions expressed below, we have assumed, without any independent verification or inquiry:

 

  (a) the genuineness of all signatures and the legal capacity of all individuals other than the Canadian Grantors (based solely on our review of the resolutions appended to each of the Officer’s Certificates), the authenticity of all original documents and the conformity to originals of all copies of documents reviewed by us, including copies received by facsimile and e-mail transmission;

 

  (b) that each of the Indenture, the First Supplemental Indenture and the Subsequent Supplemental Indentures, constitutes a legal, valid and binding obligation under the laws of the State of New York (“New York Law”) (in accordance with which it is expressed to be governed) of each party thereto, enforceable against each such party in accordance with its terms;

 

  (c) that the provisions of each of the Indenture, the First Supplemental Indenture and the Subsequent Supplemental Indentures would be interpreted and understood under New York Law to have the same meaning and content as they would have under the laws of the Province of Ontario and the federal laws of Canada applicable in such province;

 

  (d) that there have been no erroneous statements of fact made in any certificates of public officials, and we have relied on the completeness and accuracy of the public records and the currency of the information contained therein as of the dates indicated therein, although such records are known on occasion to contain errors and to be otherwise incomplete;

 

  (e) that the Indenture has not been amended, modified, supplemented, terminated or waived in any respect or in any manner, whether in writing, orally or by conduct, by any of the parties thereto since September 29, 2010, except as set out in the First Supplemental Indenture and the Subsequent Supplemental Indentures; and

 

  (f) that the First Supplemental Indenture has not been amended, modified, supplemented, terminated or waived in any respect or in any manner, whether in writing, orally or by conduct, by any of the parties thereto since November 18, 2010, except as set out in the Subsequent Supplemental Indentures

The opinions expressed below are limited to the laws of the Province of Ontario and the federal laws of Canada applicable therein in effect as of the date hereof (“Applicable Laws”) and we express no opinion as to any laws, or any matters governed by any laws, other than Applicable Laws.

Page 3

 

Based and relying on and subject to the foregoing, we are of the opinion that:

1. Ruskin (a) is a corporation duly incorporated and validly subsisting under the laws of Canada and has not been dissolved and (b) has the corporate power and capacity to enter into the First Supplemental Indenture and perform its obligations under the First Supplemental Indenture and the Indenture.

2. Each of ACD and Tomkins (a) is a corporation duly incorporated and validly subsisting under the laws of the province of Ontario and has not been dissolved and (b) has the corporate power and capacity to enter into the First Supplemental Indenture and perform its obligations under the First Supplemental Indenture and the Indenture.

3. The execution and delivery of the First Supplemental Indenture and performance by each of the Canadian Grantors of the First Supplemental Indenture and the Indenture has been authorized by all necessary corporate action on its part. The First Supplemental Indenture has been duly executed by each of the Canadian Grantors, and to the extent that Applicable Laws apply to such delivery, has been delivered by it.

4. No authorization, consent or approval of or filing with any governmental authority was required to be obtained by the Canadian Grantors under Applicable Laws in connection with the execution and delivery by the Canadian Grantors of the First Supplemental Indenture or is required with the performance at this time by each of the Canadian Grantors of its obligations thereunder or under the Indenture.

 

 

The opinions expressed herein are provided solely for the benefit of the addressees in connection with the transactions provided for in the Indenture and may not be used or relied on by any other person other than by Latham & Watkins LLP in the issuance of its opinion letter in connection with the registration statement on Form F-4 for the Issuers and the guarantors (including the Canadian Grantors) with respect to the notes offered by the Issuers, and any amendments thereto, including any post-effective amendments registration statement on Form F-4 to be filed by the Issuers and the guarantors (including the Canadian Grantors) or for any other purpose, nor may such opinions be quoted in whole or in part or otherwise referred to, without our prior written consent. We hereby consent to the filing of this opinion with the U.S. Securities and Exchange Commission as an exhibit to the registration statement on Form F-4 for the Issuers and the guarantors (including the Canadian Grantors).

Yours very truly,

/s/ Davies Ward Phillips & Vineberg LLP

EX-5.13 32 dex513.htm EXHIBIT 5.13 Exhibit 5.13

Exhibit 5.13

 

 

   99 Bishopsgate   
   London EC2M 3XF   
   United Kingdom   
   Tel: +44(0)20.7710.1000 Fax: +44(0)20.7374.4460
   www.lw.com     
LOGO    FIRM / AFFILIATE OFFICES   
   Abu Dhabi   Moscow   
   Barcelona   Munich   
   Beijing   New Jersey   
   Boston   New York   
   Brussels   Orange County   
   Chicago   Paris   
   Doha   Riyadh   
   Dubai   Rome   
   Frankfurt   San Diego   
   Hamburg   San Francisco   
   Hong Kong   Shanghai   
   Houston   Silicon Valley   

To: Tomkins, LLC

1551 Wewalta Street

Denver

CO 80202

   

London

Los Angeles

Madrid

Milan

  

Singapore

Tokyo

Washington, D.C.

   
       
       
       
Tomkins, Inc.        
1551 Wewalta Street        
Denver        
CO 80202        

 

24 June 2011

Dear Sirs

 

Re: Registration Statement on Form F-4 relating to the $1,150,000,000 9% Senior Secured Second Lien Notes due 2018 (the “New Notes”) of Pinafore, LLC and Pinafore, Inc. (the “Issuers”)

We have acted as English legal advisers to the Issuers and each of the companies listed in Schedule 3 (the “English Guarantors”) in connection with the filing of the registration statement on From F-4 originally filed on • June 2011 by the Issuers and its co-registrants listed therein with the Securities and Exchange Commission (the “SEC”) under the United States Securities Act of 1933, as amended (the “Securities Act”), as the same may be amended from time to time (the “Registration Statement”). The New Notes are to be issued pursuant to the terms of the indenture dated 29 September 2010, as supplemented by the First Supplemental Indenture dated as of 18 November 2010, the Second Supplemental Indenture dated as of 21 December 2010, the Third Supplemental Indenture dated as of 23 December 2010, the Fourth Supplemental Indenture dated as of 20 January 2011, the Fifth Supplemental Indenture dated as of 23 February 2011, the Sixth Supplemental Indenture dated as of 24 February 2011 and the Seventh Supplemental Indenture dated as of 3 March 2011, filed as exhibits to the Registration Statement and entered into between, among others, the Issuers, the English Guarantors and Wilmington Trust FSB as trustee (together, the “Indenture”). Upon the Registration Statement becoming effective pursuant to the Securities Act, the Issuer will offer to exchange up to $1,150,000,000 in aggregate principal amount of the New Notes and the related Guarantees for up to $1,150,000,000 in aggregate principal amount of the Issuer’s outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Existing Notes”).

Latham & Watkins is the business name of Latham & Watkins (London) LLP, a registered limited liability partnership organised under the laws of New York and regulated by the Solicitors Regulation Authority (SRA No. 203820). A list of the names of the partners of Latham & Watkins (London) LLP is open to inspection at its principal place of business, 99 Bishopsgate, London EC2M 3XF, and such persons are either solicitors, registered foreign lawyers or European lawyers. We are affiliated with the firm Latham & Watkins LLP, a limited liability partnership organised under the laws of Delaware.

24 June 2011

Page 2

LOGO

 

 

1. INTRODUCTION

 

1.1 Purpose

This letter is being rendered to you pursuant to Form F-4 and Reg S-K Item 601(b)(5) of the Securities Act.

 

1.2 Defined terms and headings

In this letter:

 

  1.2.1 capitalised terms used without definition in this letter or the schedules hereto have the meanings assigned to them in the Indenture unless a contrary indication appears; and

 

  1.2.2 headings are for ease of reference only and shall not affect interpretation.

 

1.3 Legal review

For the purpose of issuing this letter we have reviewed only the following documents and conducted only the following enquiries and searches:

 

  1.3.1 searches at Companies House in respect of each of the English Guarantors on 24 June 2011 (the “Searches”);

 

  1.3.2 enquiries by telephone at the Central Index of Winding Up Petitions, London on 24 June 2011 with respect to each of the English Guarantors at the times set out below (the “Enquiries”):

ACD Tridon (Holdings) Limited at 10:29 a.m.

Air System Components Investments China Limited at 10:30 a.m.

Beta Naco Limited at 10:30 a.m.

British Industrial Valve Company Limited at 10:32 a.m.

Gates Auto Parts Holdings China Limited at 10:33 a.m.

Gates Engineering & Services UK Holdings Limited at 10:33 a.m.

Gates Fluid Power Technologies Investments Limited at 10:33 a.m.

Gates Holdings Limited at 10:33 a.m.

Gates PowerTrain UK Limited at 10:33 a.m.

H Heaton Limited at 10:33 a.m.

Olympus (Ormskirk) Limited at 10:32 a.m.

Ruskin Air Management Limited at 10:32 a.m.

Shiitake Limited at 10:26 a.m.

Stackpole Investments Limited at 10:25 a.m.

Swindon Silicon Systems Limited at 10:25 a.m.

Tomkins Acquisitions Limited at 10:15 a.m.

Tomkins Engineering Limited at 10:15 a.m.

Tomkins Finance Limited at 10:15 a.m.

Tomkins Finance Luxembourg Limited at 10:15 a.m.

Tomkins Funding Limited at 10:15 a.m.

Tomkins Ideal Clamps (Suzhou) Investments Limited at 10:15 a.m.

24 June 2011

Page 3

LOGO

 

Tomkins Investments China Limited at 10:15 a.m.

Tomkins Investments Limited at 10:15 a.m.

Tomkins Limited at 10:15 a.m.

Tomkins Overseas Company at 10:15 a.m.

Tomkins Overseas Investments Limited at 10:15 a.m.

Tomkins Pension Services Limited at 10:15 a.m.

Tomkins SC1 Limited at 10:15 a.m.

Tomkins Sterling Company at 10:15 a.m.

Tomkins Treasury (Canadian Dollar) Limited at 10:15 a.m.

Tomkins Treasury (Dollar) Company at 10:15 a.m.

Tomkins Treasury (Euro) Company at 10:14 a.m.

Trico Products (Dunstable) Limited at 10:13 a.m.

Willer & Riley Limited at 10:12 a.m.

 

  1.3.3 a certificate (and the annexures thereto) of a director of each of the English Guarantors dated 29 September 2010, except for the certificate of Gates PowerTrain UK Limited which is dated 24 February 2011 and the certificate of Tomkins Acquisitions Limited which is dated 30 September 2010 (the “Certificates”);

 

  1.3.4 an executed copy of the Indenture; and

 

  1.3.5 a draft of the Registration Statement.

 

1.4 Applicable law

This letter, the opinions given in, and any non-contractual obligations arising out of or in connection with this letter and/or the opinions given in it, are governed by, and to be construed in accordance with, English law and relate only to English law as applied by the English courts as at today’s date. In particular:

 

  1.4.1 we have not investigated the laws of any country other than England and we assume that no foreign law affects any of the opinions stated below; and

 

  1.4.2 we express no opinion in this letter on the laws of any jurisdiction other than England.

 

1.5 Assumptions and reservations

The opinions given in this letter are given on the basis of each of the assumptions set out in Schedule 1 (Assumptions) and are subject to each of the reservations set out in Schedule 2 (Reservations) to this letter. The opinions given in this letter are strictly limited to the matters stated in paragraph 2 (Opinions) below and do not extend, and should not be read as extending by implication or otherwise, to any other matters.

 

2. OPINIONS

Subject to paragraph 1 (Introduction) and the other matters set out in this letter, it is our opinion that, as at today’s date:

 

2.1 Corporate existence

Each of the English Guarantors were duly incorporated under the laws of England as a company with limited liability and:

24 June 2011

Page 4

LOGO

 

 

  2.1.1 the Searches revealed no order or resolution for the winding up of any of the English Guarantors and no notice of appointment in respect of any of the English Guarantors of a liquidator, receiver, administrative receiver or administrator; and

 

  2.1.2 the Enquiries indicated that no petition for the winding up of any of the English Guarantors had been presented.

 

2.2 Corporate Authority

The execution of the Indenture and the exercise by each of the English Guarantors of its rights and the performance of its obligations thereunder, including under the guarantees set out in the Indenture, have been duly authorised by all necessary corporate action on the part of each of the English Guarantors.

 

2.3 Capacity

Each of the English Guarantors has the requisite corporate capacity to enter into the Indenture, including the guarantees set out therein, and to perform its obligations thereunder.

 

2.4 No conflict

The entry into, delivery and performance of its obligations under the Indenture by each of the English Guarantors does not violate its memorandum and articles of association, or (ii) any existing laws of England and Wales applicable to companies generally.

 

2.5 Due Execution and Delivery

The English Guarantors have duly executed and delivered the Indenture.

 

3. EXTENT OF OPINIONS

We express no opinion as to any agreement, instrument or other document other than as specified in this letter or as to any liability to tax which may arise or be suffered as a result of or in connection with the Registration Statement.

This letter only applies to those facts and circumstances which exist as at today’s date and we assume no obligation or responsibility to update or supplement this letter to reflect any facts or circumstances which may subsequently come to our attention, any changes in laws which may occur after today, or to inform the addressees of any change in circumstances happening after the date of this letter which would alter our opinions.

 

4. ADDRESSEES

This letter is addressed to you solely for your benefit in connection with the Registration Statement. This letter may not be relied upon by you for any other purpose, or furnished to, or assigned to or relied upon by any other person, firm or entity for any purpose (including, without limitation, by any person, firm or other entity that acquires Notes from you), without our prior written consent, which may be granted or withheld in our discretion.

24 June 2011

Page 5

LOGO

 

Notwithstanding the above, this letter may be relied upon by Latham & Watkins LLP in connection with the filing of the Registration Statement and its opinion with respect to the validity of the securities being registered thereunder. We hereby consent to the filing of this letter as an exhibit to the Registration Statement and to the use of our name in the prospectus contained under the caption “Legal matters”. In giving such consent, we do not thereby admit that we are included in the category of persons whose consent is required under section 7 of the Securities Act or the rules and regulations of the SEC promulgated thereunder.

 

Yours faithfully

/s/ LATHAM & WATKINS

SCHEDULE 1

Assumptions

The opinions in this letter have been made on the basis of the following assumptions:

 

1. Genuine, authentic and complete documents/searches

 

  (a) The genuineness of all signatures, stamps and seals on all documents, the authenticity and completeness of all documents submitted to us as originals, and the conformity to authentic original documents of all documents submitted to us as copies;

 

  (b) that all documents, forms and notices which should have been delivered to the Companies Registration Office on behalf of, or relating to, each of the English Guarantors have been so delivered and the files of records maintained at the Companies Registration Office concerning each of the English Guarantors, as reproduced for us by our search agents, were complete, accurate and up to date at the time of the Searches, and have not since the time of the Searches been altered;

 

  (c) that the contents of the Certificates are correct in all respects and the attachments to the Certificates are complete, accurate and up to date;

 

  (d) that the proceedings and resolutions described in the minutes of the meetings of the board of directors of each of the English Guarantors referred to in the Certificates were duly conducted as so described, the persons authorised therein to execute the Indenture on behalf of each of the English Guarantors (the “Authorised Signatories”) were so appointed and that each of the meetings referred to therein was duly constituted and convened and all constitutional, statutory and other formalities were duly observed (including, if applicable, those relating to the declaration of directors’ interests or the power of interested directors to vote), a quorum was present throughout, the requisite majority of directors voted in favour of approving the resolutions and the resolutions passed thereat were duly adopted, have not been revoked or varied and remain in full force and effect; and

 

  (e) that none of English Guarantors has passed any new resolutions affecting, terminating, revoking or superseding the resolutions contained in the Certificates as reviewed by us.

 

2. Parties

 

  (a) To the extent that the obligations of each of the English Guarantors under the Indenture may be dependent upon such matters, that with respect to any party (other than, to the extent expressly set out in the opinions in this letter in relation to the English Guarantors), such party:

 

  (i) is duly organised, validly existing and in good standing (where such concept is legally relevant) under the laws of its jurisdiction of incorporation;

 

6

  (ii) is in compliance, generally, with all applicable laws, rules and regulations to which it is subject, its constitutional documents and any judicial or administrative judgments, awards, injunctions or orders binding upon it or its property;

 

  (iii) has the requisite organisational and legal power and authority to perform its obligations under all relevant documents;

 

  (iv) is duly qualified to engage in the activities contemplated by all relevant documents and will not be in breach of any of its respective obligations under any document, contract, instrument or agreement as a result of its entry into and performance of its obligations under such documents;

 

  (v) is authorised under all applicable laws of its jurisdiction and domicile (where not England and Wales) to submit to the jurisdiction of the English courts and, where not incorporated or domiciled in England and Wales, has validly submitted to such jurisdiction; and

 

  (vi) has (or in the case of the Notes will have) validly authorised, executed and delivered all relevant documents;

 

  (b) that, where a document is required to be delivered, each party to it has (or in the case of the Notes will have) delivered the same without it being subject to any escrow or other similar arrangement; and

 

  (c) that, where any obligations entered into by the English Guarantor under the Indenture involve the giving of a guarantee or security in support of the obligations of a parent company, such obligations do not require the making of a provision (as contemplated by s.831(3) of the Companies Act 2006) which would result in any reduction in the English Guarantor’s net assets (or, to the extent they will result in a reduction, that reduction can be met out of the English Guarantor’s distributable reserves) or increase in the English Guarantor’s net liabilities.

 

3. Other documents or arrangements

 

  (a) That the Indenture remains accurate and complete and has not been amended, terminated or otherwise discharged as at the date of this letter;

 

  (b) the absence of fraud or mutual mistake of fact or law or any other arrangements, agreements, understandings or course of conduct or prior or subsequent dealings, amending, rescinding or modifying or suspending any of the terms of the Indenture or which would result in the inclusion of additional terms therein, and that the parties have acted in accordance with the terms of such agreements and documents; and

 

7

  (c) that the Indenture has been entered into in good faith and on bona fide commercial terms and on arms’ length terms and for the purpose of carrying on each of the English Guarantors’ business and that there are reasonable grounds for believing that the giving of the guarantees in the Indenture by each of the English Guarantor will promote such English Guarantor’s success for the benefit of the members as a whole.

 

4. Representations and warranties

That all statements of fact and representations and warranties contained in or made in connection with any of the documents examined by us were true and correct as at the date given and are true and correct at today’s date and no fact was omitted therefrom which would have made any of such facts, representations or warranties incorrect or misleading.

 

5. Foreign laws

That there are no provisions of the laws, and there is no public policy, of any jurisdiction outside England which would be contravened by the execution and delivery of, or the performance of the obligations under, the Indenture and that, insofar as any obligation under, or action to be taken under, the Indenture is required to be performed or taken in any jurisdiction outside England, the performance of such obligation or taking of such action will not be illegal or unenforceable by virtue of the laws, or contravene any public policy, of that jurisdiction.

 

6. Filings, approvals, consents etc.

That no consents, approvals, authorisations, orders, licences, registrations, filings or similar formalities are required from any governmental or regulatory authority in connection with the execution, delivery and performance of the Indenture by any of the parties thereto or if such consents, approvals, authorisations, orders, licences, registrations, filings or similar formalities are required, these have been made or will be made within the prescribed time limits.

 

7. Insolvency

That none of the parties to the Indenture has taken any corporate or other action nor have any steps been taken or legal proceedings been started against any such party for the liquidation, winding up, dissolution, reorganisation or bankruptcy of, or for the appointment of a liquidator, receiver, trustee, administrator, administrative receiver or similar officer of, any such party or all or any of its or their assets (or any analogous proceedings in any jurisdiction) and none of the parties to the Indenture is unable to pay its debts as they fall due, is insolvent or has been dissolved or declared bankrupt.

 

8

SCHEDULE 2

Reservations

The opinions in this letter are subject to the following reservations:

 

1. Limitations of Searches

The Searches and the Enquiries are not conclusively capable of revealing whether or not insolvency proceedings have been commenced. We have not made any enquiry of any County Court as to whether a petition for the appointment of an administrator has been presented to, or an administration order made by, such County Court against the English Guarantor.

 

2. Insolvency

The opinions set out in this letter are subject to:

 

  (a) any limitations arising from applicable laws relating to insolvency, bankruptcy, administration, reorganisation, liquidation or analogous circumstances; and

 

  (b) an English court exercising its discretion under section 426 of the Insolvency Act 1986 (co-operation between courts exercising jurisdiction in relation to insolvency) to assist the courts having the corresponding jurisdiction in any part of the United Kingdom or any relevant country or territory.

 

3. Monetary obligations payable other than in Sterling

Whilst, in the event of any proceedings being brought in an English court in respect of any monetary obligation expressed to be payable in a currency other than Sterling, an English court would have power to give judgment to pay such currency, it may decline to do so in its discretion and an English court might not enforce the benefit of a currency conversion or indemnity clause and, with respect to bankruptcy, insolvency, liquidation, moratorium, reorganisation, reconstruction or similar proceedings, English law may require that all claims or debts are converted into Sterling at an exchange rate determined by the court at a date related thereto, such as the date of commencement of a winding-up.

 

4. Matters of fact

We express no opinion as to matters of fact.

 

9

SCHEDULE 3

English Guarantors

ACD Tridon (Holdings) Limited (03113491)

Air System Components Investments China Limited (06555816)

Beta Naco Limited (02270689)

British Industrial Valve Company Limited (00431157)

Gates Auto Parts Holdings China Limited (06411482)

Gates Engineering & Services UK Holdings Limited (06907534)

Gates Fluid Power Technologies Investments Limited (06555836)

Gates Holdings Limited (04165143)

Gates PowerTrain UK Limited (07474199)

H Heaton Limited (00143011)

Olympus (Ormskirk) Limited (00559058)

Ruskin Air Management Limited (00738495)

Shiitake Limited (00367671)

Stackpole Investments Limited (05932999)

Swindon Silicon Systems Limited (01378199)

Tomkins Acquisitions Limited (7323239)

Tomkins Engineering Limited (00134382)

Tomkins Finance Limited (04805031)

Tomkins Finance Luxembourg Limited (06625828)

Tomkins Funding Limited (00459191)

Tomkins Ideal Clamps (Suzhou) Investments Limited (05345092)

Tomkins Investments China Limited (05588989)

Tomkins Investments Limited (00313862)

Tomkins Limited (0203531)

Tomkins Overseas Company (04453155)

Tomkins Overseas Investments Limited (00286193)

Tomkins Pension Services Limited (00984887)

Tomkins SC1 Limited (00548989)

Tomkins Sterling Company (05638281)

Tomkins Treasury (Canadian Dollar) Limited (04758649)

Tomkins Treasury (Dollar) Company (04528457)

Tomkins Treasury (Euro) Company (04528476)

Trico Products (Dunstable) Limited (02866179)

Willer & Riley Limited (00245777)

 

10

EX-5.14 33 dex514.htm EXHIBIT 5.14 Exhibit 5.14

Exhibit 5.14

 

[Latham & Watkins LLP Letterhead]    Maximilianhöfe Maximilianstrasse 11

80539 München

Tel: +49.89.2080.3.8000

Fax: +49.89.2080.3.8080

www.lw.com

   Abu Dhabi

Barcelona

Brüssel

Chicago

Doha

Dubai

Frankfurt

Hamburg

    München

New Jersey

New York

Orange County

Paris

Peking

Riad

Rom

To:

 

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, Colorado 80202

    Hongkong

Houston

London

Los Angeles

Madrid

Mailand

Moskau

    San Diego

San Francisco

Shanghai

Silicon Valley

Singapur

Tokio

Washington, D.C

June 24 2011

Re: Registration Statement on Form F-4 relating to USD 1,150,000,000 aggregate principal amount of 9% senior secured second lien notes due 2018

Ladies and Gentlemen,

 

1. DESCRIPTION OF TRANSACTION

We have acted as legal advisors to Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly Pinafore, LLC) and certain affiliated companies, in connection with (i) the issuance of USD 1,150,000,000 aggregate principal amount of 9% senior secured second lien notes due 2018 (the “Notes”) pursuant to an indenture (the “Indenture”) dated 29 September 2010 between, among others, Pinafore, LLC and Pinafore, Inc. as issuers, certain other parties as guarantors and Wilmington Trust FSB as trustee for the holders of the notes and collateral agent, (ii) the entering into certain guarantees of the Notes contained in the Indenture (the “Guarantees”) by the entities listed in Schedule 1 hereto (the “German Companies” and each a “German Company”) and (iii) the registration of the Guarantees pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended, filed with the Securities and Exchange Commission, as amended from time to time (the “Registration Statement”).

This opinion (the “Opinion”) is rendered to you in connection with the Registration Statement.

Terms defined in the Indenture have the same meanings when used in this Opinion, unless otherwise defined in this Opinion.

2. DOCUMENTS EXAMINED

 

2.1 For the purposes of this Opinion, we have examined:

 

  (a) an electronic copy of the executed Indenture;

 

  (b) an electronic copy of an executed first supplement agreement to the Indenture dated 18 November 2010;

 

  (c) an electronic copy of an executed second supplement agreement to the Indenture dated 21 December 2010;

 

  (d) an electronic copy of an executed third supplement agreement to the Indenture dated 23 December 2010;

 

  (e) an electronic copy of an executed fourth supplement agreement to the Indenture dated 20 January 2011;

 

  (f) an electronic copy of an executed fifth supplement agreement to the Indenture dated 23 February 2011;

 

  (g) an electronic copy of an executed sixth supplement agreement to the Indenture dated 24 February 2011;

 

  (h) an electronic copy of an executed seventh supplement agreement to the Indenture dated 3 March 2011;

 

  (i) in relation to Eifeler Maschinenbau GmbH:

 

  (i) an electronic copy of the excerpt of the commercial register (Handelsregister) at the local court (Amtsgericht) of Bonn, dated 15 June 2011;

 

  (ii) an electronic copy of the articles of association (Gesellschaftsvertrag) of Eifeler Maschinenbau GmbH, certified on 20 September 2010;

 

  (iii) an electronic copy of a certified copy of a shareholder’s list, dated 22 November 2010, certified on 30 November 2010;

 

  (iv) an electronic copy of a shareholder’s resolution signed by Gates Holding GmbH as shareholder of Eifeler Maschinenbau GmbH, dated 10 December 2010;

 

  (j) in relation to Gates Holding GmbH:

 

  (i) an electronic copy of the excerpt of the commercial register (Handelsregister) at the local court (Amtsgericht) of Bonn, dated 15 June 2011;

 

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  (ii) an electronic copy of the articles of association (Gesellschaftsvertrag) of Gates Holding GmbH, dated 1 December 2010, certified on 3 December 2010;

 

  (iii) an electronic copy of a shareholder’s list, dated 19 November 2010, certified on 30 November 2010;

 

  (iv) an electronic copy of a shareholder’s resolution signed by Gates Holdings Limited as shareholder of Gates Holding GmbH, dated 6 December 2010;

 

  (k) in relation to Gates Mectrol GmbH:

 

  (i) an electronic copy of the excerpt of the commercial register (Handelsregister) at the local court (Amtsgericht) of Darmstadt, dated 15 June 2011;

 

  (ii) an electronic copy of a certified copy of the articles of association (Satzung) of Gates Mectrol GmbH, dated 19 November 2010, certified on 13 December 2010;

 

  (iii) an electronic copy of a certified copy of a shareholder’s list, dated 19 November 2010, certified on 27 December 2010;

 

  (iv) an electronic copy of a shareholder’s resolution signed by Tomkins Overseas Investments Limited as shareholder of Gates Mectrol GmbH, dated 6 December 2010;

 

  (l) in relation to Trion (Deutschland) GmbH:

 

  (i) an electronic copy of the excerpt of the commercial register (Handelsregister) at the local court (Amtsgericht) of Hamburg, dated 15 June 2011;

 

  (ii) an electronic copy of a certified copy of the articles of association (Gesellschaftsvertrag) of Trion (Deutschland) GmbH, dated 2 December 2010, certified on 14 December 2010;

 

  (iii) an electronic copy of a certified copy of a shareholder’s list, dated 1 December 2010, certified on 14 December 2010;

 

  (iv) an electronic copy of a shareholder’s resolution signed by Tomkins Finance Ltd. as shareholder of Trion (Deutschland) GmbH, dated 7 December 2010;

 

  (m) in relation to Tridon Clamp Products GmbH

 

  (i) an electronic copy of the excerpt of the commercial register (Handelsregister) at the local court (Amtsgericht) of Bonn, dated 15 June 2011;

 

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  (ii) an electronic copy of a certified copy of the articles of association (Satzung) of Tridon Clamp Products GmbH, certified on 6 May 2009;

 

  (iii) an electronic copy of a shareholder’s list, dated 30 November 2010, certified on 8 December 2010;

 

  (iv) an electronic copy of a shareholder’s resolution signed by Tomkins Finance Ltd. as shareholder of Tridon Clamp Products GmbH, dated 7 December 2010;

 

  (v) an electronic copy of a shareholder’s resolution appointing Michael H. Reese as managing director signed by Tomkins Finance Ltd. (formerly Tomkins Finance, plc.) as shareholder of Tridon Clamp Products GmbH, dated 7 April 2010, certified on 10 June 2010; and

 

  (n) an electronic copy of the executed power of attorney:

 

  (i) of Eifeler Maschinenbau GmbH dated 10 December 2010 relating to, inter alia, the execution of the joinder/supplement agreement in relation to the Indenture;

 

  (ii) of Gates Holding GmbH dated 10 December 2010 relating to, inter alia, the execution of the joinder/supplement agreement in relation to the Indenture;

 

  (iii) of Gates Mectrol GmbH dated 7 December 2010 relating to, inter alia, the execution of the joinder/supplement agreement in relation to the Indenture;

 

  (iv) of in Trion (Deutschland) GmbH dated 13 December 2010 relating to, inter alia, the execution of the joinder/supplement agreement in relation to the Indenture;

 

  (v) of Tridon Clamp Products GmbH dated 3 December 2010 relating to, inter alia, the execution of the joinder/supplement agreement in relation to the Indenture;

(all powers of attorney listed under paragraphs 2.1(n) through (v) together, the “Powers of Attorney”).

 

2.2 The documents listed under paragraphs 2.1(a) through (h) above are hereinafter collectively referred to as the “Notes Documents”.

 

2.3 Except as stated above, we have not examined any agreements, deeds, instruments or other documents entered into by or affecting any of the German Companies or any corporate records of any other person and we have not made any other enquiries concerning any other person. We have not investigated whether any of the German Companies or any other party is or will be by reason of the transactions and matters contemplated by the Notes Documents in breach of any of its obligations under any agreement, document, deed or instrument.

 

4/8

3. OPINION LIMITED TO GERMAN LAW

We have not investigated the laws of any country other than the Federal Republic of Germany and we assume that no foreign law affects any of the conclusions stated below. This opinion letter speaks only as of the date hereof and is given only with respect to the laws of the Federal Republic of Germany as in effect on the date hereof and we express no opinion as to matters of fact.

 

4. ASSUMPTIONS

In giving this Opinion, we have assumed:

 

4.1 the genuineness of all signatures;

 

4.2 the authenticity and completeness of all documents submitted to us as originals;

 

4.3 the conformity to original documents of all documents submitted to us as copies (including, without limitation, faxed copies) and the authenticity and completeness of such original documents;

 

4.4 that, where we have examined a document in draft form, it has been executed in the form submitted to us as draft;

 

4.5 that the Notes Documents are legally valid, binding and enforceable against all parties thereto under all relevant laws and that each Notes Document has been duly authorized and executed by all parties thereto (other than the German Companies);

 

4.6 each individual executing any Notes Document or a power of attorney on behalf of any German Company had unlimited legal capacity “unbeschränkte Geschäftsfähigkeit” at the time of execution and has issued a statement of intent “Willenserklärung” which is not subject to rescission “nicht anfechtbar”;

 

4.7 that the shareholders of the German Companies and their shareholding as of the date of signing of each relevant document and as of the date of this Opinion are as set out in the shareholders lists;

 

4.8 the Powers of Attorney have not been amended or rescinded and are in full force and effect;

 

4.9 the Powers of Attorney are legally binding and effective under all relevant laws other than German law;

 

4.10 the copies of the resolutions of the shareholders of each German Company provided to us in connection with the giving of this Opinion accurately record resolutions which were duly passed at a properly convened meeting of the shareholders of each German Company and at that a quorum of such shareholders present throughout the meeting voted in favour of approving the resolutions;

 

4.11 the German Companies have their centre of main interests (as such term is described in Article 3 (1) of Council Regulation (EC) No. 1346/2000 of 29 May 2000 on Insolvency Proceedings) in Germany;

 

5/8

4.12 none of the German Companies has passed a voluntary winding-up resolution and no petition or application has been presented to or order made by a court for the winding-up or dissolution of any of the German Companies or the appointment of a liquidator of any of the German Companies and no liquidator has been appointed in respect of any of the German Companies;

 

4.13 no application for the commencement of an insolvency procedure “Insolvenzantrag” in relation to any of the German Companies has been made;

 

4.14 that as of the date of this Opinion none of the German Companies is or will be deemed unable to pay any of its debts when they fall due (Zahlungsunfähigkeit) or is overindebted (überschuldet);

 

4.15 no party to the Notes Documents is aware of any circumstance which would indicate that or give reason to enquire further whether or not any party to the Notes Documents is or would be, close to a situation of being presumably unable to pay its debts as they fall due or overindebted in any jurisdiction;

 

4.16 no party enters into any Notes Document or any transaction contemplated thereby with bad faith or with the intention to prejudice, defraud or damage any creditor of any of the German Companies or any other party to the Notes Documents;

 

4.17 that the commercial register excerpts and the articles of association (as provided to us by or on behalf of the German Companies) are accurate and complete as of their respective dates and that no changes to the facts stated therein have occurred between their respective dates and the date of this Opinion;

 

4.18 that all powers of attorney and declarations of ratifications granted by any of the parties to the Notes Documents to the individuals executing the Notes Documents, and the Notes Documents, have not been revoked, rescinded, repealed, terminated (in each case whether in whole or in part), amended or supplemented.

 

5. OPINION

Based upon the foregoing and subject to any matters not disclosed to us, and subject to the qualifications set out below, we are of the opinion that:

 

5.1 Each of the German Companies is a limited liability company (Gesellschaft mit beschränkter Haftung), validly existing under the laws of the Federal Republic of Germany.

 

5.2 Each of the German Companies has the power and authority under its articles of association to enter into the Notes Documents to which it is a party and to perform its obligations thereunder, and has duly taken all necessary corporate action required under its articles of association to authorize the execution of each of the Notes Documents to which it is a party on its behalf and the performance of its obligations thereunder.

 

5.3 Each of the German Companies has been duly represented in the execution of the Notes Documents to which it is a party.

 

6/8

6. QUALIFICATIONS

This Opinion is subject to the following qualification:

The ability of the German Companies to enter into and perform their obligations under the Notes Documents may be limited by insolvency, liquidation, reorganization or any other laws of general application relating to or affecting the rights of creditors (including the attachment of claims by third party creditors) as such law may be applied in the event of an insolvency, liquidation, reorganization or other similar proceedings with respect to such party.

 

7. BENEFIT

This Opinion is rendered only to you for your own behalf in connection with the Registration Statement and may only be relied upon by you and by persons entitled to rely upon it pursuant to applicable provisions of United States federal securities law. We consent to your filing of this Opinion as an exhibit to the Registration Statement and to the reference to our firm contained under the heading “Legal Matters” in the prospectus contained therein. This Opinion may not be relied upon by you for any other purpose or furnished to, assigned to, quoted to or relied upon by any other person, firm or corporation for any purpose, without our prior written consent, which may be granted or withheld in our sole discretion.

 

Yours faithfully,
/s/ Latham & Watkins LLP
LATHAM & WATKINS LLP

 

7/8

SCHEDULE 1

German Companies

 

1. Eifeler Maschinenbau GmbH, registered with the commercial register (Handelsregister) at the local court (Amtsgericht) of Bonn under HRB 10971;

 

2. Gates Holding GmbH, registered with the commercial register (Handelsregister) at the local court (Amtsgericht) of Bonn under HRB 14605;

 

3. Gates Mectrol GmbH, registered with the commercial register (Handelsregister) at the local court (Amtsgericht) of Darmstadt under HRB 9342;

 

4. Trion (Deutschland) GmbH, registered with the commercial register (Handelsregister) at the local court (Amtsgericht) of Hamburg under HRB 109246;

 

5. Tridon Clamp Products GmbH, registered with the commercial register (Handelsregister) at the local court (Amtsgericht) of Bonn under HRB 17137

 

8/8

EX-5.15 34 dex515.htm EXHIBIT 5.15 Exhibit 5.15

Exhibit 5.15

 

Tomkins, Inc.

Tomkins, LLC

155 Wewatta Street

Denver, Colorado 80202

       

AMSTERDAM

Strawinskylaan 10

1077 XZ Amsterdam

   T   +   31 20 485 7000
   Direct T   +   31 20 485 7620
   F   +   31 20 485 7001
   Direct F   +   31 20 517 7620
   E     thijs.flokstra@ freshfields.com
   W     freshfields.com
  

 

DOC ID

    

 

AMS2031828

   OUR REF     TPF/FVH
   DATED 24 JUNE 2011

Dear Sirs,

REGISTRATION STATEMENT ON FORM F-4

INTRODUCTION

1. We have acted as special counsel to Pinafore Holdings B.V. (the Company) and Montisk Investments Netherlands C.V. (the Limited Partnership), in connection with the issuance of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the Notes) by Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly, Pinafore, LLC) and the guarantees of the Notes (the Guarantees) by the Company and the Limited Partnership under an indenture dated as of 29 September 2010, as supplemented by the first supplemental indenture dated as of 18 November 2010, the second supplemental indenture dated as of 21 December 2010, the third supplemental indenture dated as of 23 December 2010, the fourth supplemental indenture dated as of 20 January 2011, the fifth supplemental indenture dated as of 23 February 2011, the sixth supplemental indenture dated as of 24 February 2011 and the seventh supplemental indenture dated as of 3 March 2011 (collectively, the Opinion Document) entered into among the Tomkins, Inc. and Tomkins, LLC, the Guarantors named therein, and Wilmington Trust FSB, as trustee and collateral agent, and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended (the Act), filed with the Securities and Exchange Commission on 24 June 2011 (the Registration Statement).

Freshfields Bruckhaus Deringer LLP is a limited liability partnership registered in England and Wales with registered number OC334789. It is regulated by the Solicitors Regulation Authority. Dutch Chambers of Commerce registration number 34368197. For regulatory information please refer to www.freshfields.com/support/legalnotice.

A list of the members (and of the non-members who are designated as partners) of Freshfields Bruckhaus Deringer LLP and their qualifications is available for inspection at its registered office, 65 Fleet Street, London EC4Y 1HS or at the above address. Any reference to a partner means a member, or a consultant or employee with equivalent standing and qualifications, of Freshfields Bruckhaus Deringer LLP or any of its affiliated firms or entities. Freshfields Bruckhaus Deringer LLP’s Amsterdam office includes attorneys, civil law notaries, tax advisers and solicitors.

Bank account:

Stg Beh Derdengld Freshfields Bruckhaus Deringer LLP, ABN Amro Bank NV, IBAN: NL08FTSB0256049947, BIC: FTSBNL2R

Abu Dhabi Amsterdam Bahrain Barcelona Beijing Berlin Brussels Cologne Dubai Düsseldorf Frankfurt am Main Hamburg Hanoi Ho Chi Minh City Hong Kong London Madrid Milan Moscow Munich New York Paris Rome Shanghai Tokyo Vienna Washington

2. In rendering the opinions set out below we have examined the documents listed in the schedule hereto (the Schedule).

3. Words and expressions defined in the Schedule shall, unless the context otherwise requires, bear the same respective meaning when used in this opinion.

LIMITATIONS

4. This opinion is subject to the following limitations:

 

(a) This opinion is confined to the laws with general applicability (wettelijke regels met algemene gelding) of the Netherlands and, insofar as they are directly applicable in the Netherlands, the European Union, all as they stand as at the date hereof and as such laws are currently interpreted in published authoritative case law of the courts of the Netherlands (Netherlands law); accordingly, we express no opinion with regard to any other system of law (including the law of jurisdictions other than the Netherlands in which our firm has an office), even in cases where, in accordance with Netherlands law, any foreign law should be applied; furthermore, we do not express any opinion on public international law or on the rules of or promulgated under any treaty or by any treaty organisation (except as otherwise stated above).

 

(b) We express no opinion on any taxation laws of any jurisdiction (including the Netherlands).

 

(c) We express no opinion on any anti-trust, competition, data protection or insider trading laws of any jurisdiction (including the Netherlands).

 

(d) We express no opinion that the future or continued performance of a party’s obligations or the consummation of the transactions contemplated by the Opinion Document will not contravene Netherlands law, its application or interpretation if altered in the future.

 

(e) We express no opinion as to the correctness of any representation given by any of the parties (express or implied) under or by virtue of the Documents, save if and insofar as the matters represented are the subject matter of a specific opinion herein.

 

(f) In rendering this opinion we have exclusively examined the documents listed in the Schedule and we have conducted such investigations of Netherlands law as we have deemed necessary or advisable for the purpose of giving this opinion letter; as to matters of fact we have relied on the documents listed in the Schedule and any other document we have deemed relevant, and on statements or certificates of public officials.

 

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(g) We have not been responsible for investigating or verifying the accuracy of the facts (or statements of foreign law) or the reasonableness of any statements of opinion or intention contained in any documents, or for verifying that no material facts or provisions have been omitted therefrom; nor have we verified the accuracy of any assumption made in this opinion letter.

 

(h) Netherlands legal concepts are expressed in English terms and not in their original Dutch terms; the concepts concerned may not be identical to the concepts described by the same English terms as they exist in the laws of other jurisdictions.

 

(i) This opinion may only be relied upon on the express condition that any issues of the interpretation or liability arising hereunder will be governed by Netherlands law and be brought before a court in the Netherlands.

 

(j) This opinion speaks as of the date hereof; no obligation is assumed to update this opinion or to inform any person of any changes of law or other matters coming to our knowledge and occurring after the date hereof, which may affect this opinion in any respect.

 

(k) The opinions expressed in this opinion letter have no bearing on declarations made, opinions expressed or statements of a similar nature made by any of the parties in the Opinion Document.

 

(l) All references in this opinion letter to the Netherlands and Netherlands law are to the European part of the Netherlands and its law, respectively, only.

ASSUMPTIONS

5. In rendering this opinion we have assumed that:

 

(a) all documents reviewed by us and submitted to us as originals are true, complete and authentic; all documents reviewed by us and submitted to us as facsimile or photocopy are in conformity with the originals and such originals are true, complete and authentic; and the signatures on all such documents are genuine;

 

(b) at the time when any Corporate Document was signed, each person who is a party to or signatory of that Corporate Document, as applicable (i) had been validly incorporated, was validly existing and, to the extent relevant in such party’s jurisdiction, in good standing under the laws applicable to such party, (ii) had all requisite power, authority and legal capacity to sign that Corporate Document and to perform all juridical acts (rechtshandelingen) and other actions contemplated thereby and (iii) has validly signed that Corporate Document;

 

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(c) the Limited Partnership Agreement has not been amended, supplemented, restated, dissolved, rescinded or terminated and the Limited Partnership Agreement is in full force and effect;

 

(d) the Articles of Association have not been amended;

 

(e) (i) neither the Company, its General Partner nor its Limited Partners jointly have been declared bankrupt (failliet verklaard) nor any other similar proceeding under any applicable law (ii) neither the Company, its General Partner nor its Limited Partners has been granted a suspension of payments (surseance van betaling) nor any other similar proceeding under any applicable law (iii) neither the Limited Partnership, its General Partner, nor the Company has become subject to any of the other insolvency proceedings (together with the proceedings in paragraph (5)(e)(i) and (5)(e)(ii) referred to as the Insolvency Proceedings) referred to in Article 1(1) of Council Regulation (EC) no. 1346/2000 of 29 May 2000 on Insolvency Procedures (the Insolvency Regulation) nor any other similar proceeding under any applicable law, (iv) neither the Limited Partnership, its General Partner, nor the Company has been dissolved, (v) the Company has not ceased to exist pursuant to a legal merger or demerger (juridische fusie of splitsing) nor pursuant to any other similar proceeding under any applicable law, and (vi) no order for the administration (bewind) of the assets of the Limited Partnership, its General Partner, or the Company has been made or any other similar proceeding under any applicable law; these assumptions in respect of the Company and the Limited Partnership are supported by our enquiries today with the Commercial Register, the online Insolvency register, the court in Amsterdam and the court in The Hague which have not revealed any information that any such event has occurred with respect to the Company nor to the Limited Partnership; however, such enquiries are not conclusive evidence that no such events have occurred;

 

(f) the information set forth in the Extracts is accurate and complete on the date hereof;

 

(g) the Resolutions have not been revoked (ingetrokken) or amended and have not been and will not be declared null and void by a competent court and the powers of attorney granted in the Resolutions have not been, and will not be, amended, revoked (ingetrokken), terminated or declared null and void by a competent court and the statements and confirmations set out in the Resolutions are true and correct;

 

(h) the Limited Partnership regularly and openly conducts business activities in a certain capacity to generate a profit for itself;

 

(i) Donald West (in whatever capacity) does not have a conflict of interest (tegenstrijdig belang) with the Company in relation to the transactions contemplated by the Opinion Document;

 

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(j) the entering into the Opinion Document and the transactions contemplated thereby are in the corporate interest (vennootschappelijk belang) of the Company and ancillary to the purpose or objectives of the Limited Partnership;

 

(k) none of the Opinion Document has since the date of its execution been amended, rescinded or terminated by any of the parties thereto;

 

(l) each of the parties to any of the Opinion Document (other than the Company and the Limited Partnership) (i) has been validly incorporated, is validly existing and, to the extent relevant in such party’s jurisdiction, in good standing under the laws applicable to such party, (ii) has the power, capacity and authority to enter into, execute and deliver the Opinion Document to which it is a party and to exercise its rights and perform its obligations thereunder, and (iii) has duly authorised and validly executed and, to the extent relevant, delivered all Opinion Document to which it is a party;

 

(m) the Opinion Document constitutes the legal, valid, binding and enforceable obligations of each party thereto (other than the Company and the Limited Partnership) enforceable against such party in accordance with its terms;

 

(n) neither the Limited Partnership, its General Partner nor the Company is required to be licensed pursuant to the Netherlands Financial Supervision Act (Wet op het financieel recht); and

 

(o) the terms of the Opinion Documents are bona fide arm’s length commercial terms and the Opinion Documents are entered into for bona fide commercial reasons.

OPINION

6. On the basis of, and subject to, the foregoing and the matters set out in paragraphs 5 and 7 and any factual matters, documents or events not disclosed to us, we are of the opinion that as at the date hereof:

Due incorporation

 

(a) The Company has been validly incorporated and is existing as a private limited liability company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) under Netherlands law.

 

(b) The Limited Partnership has been validly formed as a limited partnership (commanditaire vennootschap) under Netherlands law.

Corporate power

 

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(c) Each of the Company and the Limited Partnership has the necessary corporate power to enter into the Opinion Document and to perform its obligations thereunder.

Corporate authority

 

(d) The execution by each of the Company and the Limited Partnership of the Opinion Document and the performance by each of the Company and the Limited Partnership of their obligations thereunder have been authorised by all corporate action required to be taken by each of the Company and the Limited Partnership under Netherlands corporate law, the Articles of Association or, as the case may be, the Limited Partnership Agreement.

Due execution

 

(e) Assuming that the signature appearing on the Opinion Document on behalf of the Company is the signature of Donald West the Opinion Document has been validly executed on behalf of the Company in accordance with Netherlands law.

 

(f) Assuming that the signature appearing on the Opinion Document on behalf of the Limited Partnership is the signature of the authorised representative of the General Partner, the Opinion Document have been validly executed on behalf of the Limited Partnership in accordance with Netherlands law.

QUALIFICATIONS

7. Our opinion is subject to the following qualifications:

 

(a) a commanditaire vennootschap under the laws of the Netherlands is not a legal person (rechtspersoon) and references in this opinion letter to the Limited Partnership are to the collectivity of its partners and references in this opinion letter to the execution, delivery or performance of obligations under the Limited Partnership Guarantee by the Limited Partnership are to the execution, delivery or performance of obligations by its General Partner in its capacity as the general partner of the Limited Partnership;

 

(b)

under Netherlands rules of conflicts of law a corporation (corporatie), which expression in this context includes a limited partnership or commanditaire vennootschap (such as the Limited Partnership), is governed by Netherlands law, if the agreement by which the limited partnership was established provides that its official seat (zetel) is in the Netherlands. The Limited Partnership Agreement provides that the seat of the Limited Partnership is in the Netherlands. However, since Netherlands law on partnerships does not require a partnership to maintain a seat or specify a seat in the agreement by which it is formed, there is room for the

 

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argument that the seat specified in the Limited Partnership Agreement is not an official seat (zetel) and is not sufficient to cause the Limited Partnership to be governed by Netherlands law. This argument should not prevail, provided that at the time when the Limited Partnership was formed the centre of their external activities (centrum van optreden naar buiten) was situated in the Netherlands;

 

(c) our opinion is subject to and limited by the provisions of any applicable bankruptcy, insolvency, moratorium, suspension of payments, emergency and other similar rules and laws of general application relating to or affecting generally the enforcement of creditors’ rights and remedies from time to time in effect; no opinion is given or implied herein that if Insolvency Proceedings would be opened with respect to the Company and the Limited Partnership, such Insolvency Proceedings would be opened in the Netherlands or be governed by Netherlands law; no opinion is given or implied herein on the effects of any foreign laws that may apply in such Insolvency Proceedings pursuant to the Insolvency Regulation or otherwise;

 

(d) a power of attorney (volmacht) or mandate (lastgeving) (i) can under Netherlands law only be made irrevocable to the extent its object is the performance of juridical acts (rechtshandelingen) in the interest of the representative appointed thereby or of a third party (and subject to the power of the court to amend or disapply the provisions by which it is made irrevocable for serious reasons (gewichtige redenen) and (ii) will terminate or become ineffective upon Insolvency Proceedings being opened under Netherlands law with respect to the issuer thereof (irrespective of the law applicable to the power of attorney).

BENEFIT OF OPINION

8. This opinion is made for the benefit of and may be relied upon by the addressees hereof. This opinion also may be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the Registration Statement, and any amendments thereto, including any post-effective amendments to be filed by Tomkins, Inc. and Tomkins, LLC with the Securities and Exchange Commission under the Act. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name in the prospectus contained under the caption “Legal Matters”. In giving this consent, we do not admit that we are “experts” within the meaning of the Act or within the category of persons whose consent is required by the Act.

Yours faithfully,

/s/ Freshfields Bruckhaus Deringer LLP

Freshfields Bruckhaus Deringer LLP

 

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THE SCHEDULE

 

(a) an electronic copy of an extract from the Commercial Register of the Amsterdam Chamber of Commerce (the Commercial Register) dated 23 June 2011 relating to the Company and confirmed upon our request by the Commercial Register by telephone to be correct as at the date hereof (the Company Extract);

 

(b) a scanned copy of the deed of incorporation of the Company dated 1 September 2010;

 

(c) a scanned copy of the articles of association of the Company dated 23 September 2010 which, according to the Extract, are the Company’s articles of association currently in force and effect (the Articles of Association);

 

(d) an electronic copy of an extract from the Commercial Register dated 23 June 2011 relating to the Limited Partnership and confirmed upon our request by the Commercial Register by telephone to be correct as at the date hereof (the Limited Partnership Extract);

 

(e) an electronic copy of the limited partnership agreement (overeenkomst van commanditaire vennootschap) dated 4 August 2008 between Tomkins Investments Company S.àr.l. as general partner (the General Partner) and Tomkins American Investments S.àr.l. (Tomkins American) and Tomkins Luxembourg S.àr.l. (Tomkins Luxembourg and jointly with Tomkins Americain referred to as the Limited Partners) relating to the formation of the Limited Partnership (the Partnership Agreement);

 

(f) scanned copies of the executed:

 

  (i) minutes of the meeting of the management board of the Company held in Amsterdam, the Netherlands on 16 September 2010;

 

  (ii) written resolution of the general meeting of shareholders of the Company dated 20 September 2010;

 

  (iii) the minutes of the meeting of the management board of the Limited Partnership held in Amsterdam, the Netherlands on 28 September 2010; and

 

  (iv) the minutes of the meeting of the members of the Limited Partnership, held in Amsterdam on 28 September 2010.

 

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(g) an executed copy of:

 

  (i) the Opinion Document.

The documents referred to above in items (a) to (g) (inclusive) are herein referred to as the Documents; the documents referred to above in items (a) and (d) are herein referred to as the Extracts; the documents referred to above in items (b) to (f) (inclusive) are herein referred to as the Corporate Documents; and the documents referred to above in item (f) are herein referred to as the Resolutions.

 

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EX-5.16 35 dex516.htm EXHIBIT 5.16 Exhibit 5.16

Exhibit 5.16

LUTHER

 

To: Tomkins, Inc.
     Tomkins, LLC
     1551 Wewatta Street
     Denver, CO, 80202
     United States

 

     Hereinafter referred to as “the Addressee”

Luxembourg, 24 June 2011

 

Re.: Legal Opinion re. Tomkins, Inc. and Tomkins, LLC

Dear Sirs,

We are acting as special Luxembourg legal counsel to the following companies:

  (i) SCHRADER INVESTMENTS LUXEMBOURG S.à.r.l, a private limited liability company (société à responsabilité limitée) incorporated under the laws of the Grand Duchy of Luxembourg with its registered office at 23-25, rue Notre-Dame, L-2240 Luxembourg, with a share capital of USD 102,500 and registered with the Luxembourg Trade and Companies Register (Registre du Commerce et des Sociétés de Luxembourg) under number B 111624 (hereinafter referred to as “SIL”);
  (ii) TOMKINS AUTOMOTIVE COMPANY S.à.r.l, a private limited liability company (société à responsabilité limitée) incorporated under the laws of the Grand Duchy of Luxembourg with its registered office at 23-25, rue Notre-Dame, L-2240 Luxembourg, with a share capital of USD 100,000 and registered with the Luxembourg Trade and Companies Register (Registre du Commerce et des Sociétés de Luxembourg) under number B 115665 (hereinafter referred to as “TAC”);
  (iii) TOMKINS AMERICAN INVESTMENTS S.à.r.l, a private limited liability company (société à responsabilité limitée) incorporated under the laws of the Grand Duchy of Luxembourg with its registered office at 23-25, rue Notre-Dame, L-2240 Luxembourg, with a share capital of USD 110,500 and registered with the Luxembourg Trade and Companies Register (Registre du Commerce et des Sociétés de Luxembourg) under number B 86645 (hereinafter referred to as “TAI”);
  (iv) TOMKINS HOLDINGS LUXEMBOURG S.à.r.l, a private limited liability company (société à responsabilité limitée) incorporated under the laws of the Grand Duchy of Luxembourg with its registered office at 23-25, rue Notre-Dame, L-2240 Luxembourg, with a share capital of USD 103,000 and registered with the Luxembourg Trade and Companies Register (Registre du Commerce et des Sociétés de Luxembourg) under number B 102555 (hereinafter referred to as “THOL”);

 

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LUTHER

 

  (v) TOMKINS INVESTMENTS COMPANY S.à.r.l, a private limited liability company (société à responsabilité limitée) incorporated under the laws of the Grand Duchy of Luxembourg with its registered office at 23-25, rue Notre-Dame, L-2240 Luxembourg, with a share capital of USD 100,000 and registered with the Luxembourg Trade and Companies Register (Registre du Commerce et des Sociétés de Luxembourg) under number B 115563 (hereinafter referred to as “TIC”);
  (vi) TOMKINS LUXEMBOURG S.à.r.l, a private limited liability company (société à responsabilité limitée) incorporated under the laws of the Grand Duchy of Luxembourg with its registered office at 23-25, rue Notre-Dame, L-2240 Luxembourg, with a share capital of USD 113,750 and registered with the Luxembourg Trade and Companies Register (Registre du Commerce et des Sociétés de Luxembourg) under number B 86644 (hereinafter referred to as “TOL”);
  (vii) TOMKINS OVERSEAS HOLDINGS S.à.r.l, a private limited liability company (société à responsabilité limitée) incorporated under the laws of the Grand Duchy of Luxembourg with its registered office at 23-25, rue Notre-Dame, L-2240 Luxembourg, with a share capital of USD 95,608,025 and registered with the Luxembourg Trade and Companies Register (Registre du Commerce et des Sociétés de Luxembourg) under number B 51028 (hereinafter referred to as “TOSH”).

SIL, TAC, TAI, THOL, TIC, TOL and TOSH are collectively referred to as the “Companies” and individually as a “Company”.

We are giving this opinion in connection with the issuance of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) by Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly, Pinafore, LLC) and the guarantees of the Notes (the “Guarantees”) by the Companies under an Indenture dated as of September 29, 2010, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”) entered into among the Issuers, the Guarantors named therein, and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent, and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended (the “Act”), filed with the Securities and Exchange Commission (the “Commission”) on June 24 2011.

The undersigned is admitted to the Luxembourg Bar.

This opinion is addressed to the Addressee and is given solely for the purpose of the Transaction.

 

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LUTHER

This opinion is given for the sole benefit of the Addressee and is not to be relied upon by or communicated to any other person, nor is it to be quoted or made public in any way, in each case, without our prior written consent, except as specified hereafter. This opinion may however be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the registration statement on Form F-4 for Tomkins, Inc. and Tomkins, LLC with respect to the notes offered by Tomkins, Inc. and Tomkins, LLC, and any amendments thereto, including any post-effective amendments to be filed by Tomkins, Inc. and Tomkins, LLC.

This opinion may also be disclosed by the Addressee as may be required by law or regulation binding on the Addressee, provided that this opinion shall not be relied upon by any such person. We accept no liability in respect of this opinion to any person other than the Recipients.

Moreover, we hereby consent to the filling of this opinion with the U.S Securities Exchange Commission as an exhibit to the registration statement on Form F-4 by the Companies.

We want to stress that we do not represent ourselves to be familiar with any laws other than the laws of the Grand Duchy of Luxembourg and, in giving this opinion, we assume that there does no exist any legal provision of any other state affecting our opinion.

The opinions expressed below are limited to the laws of the Grand Duchy of Luxembourg in effect as of the date thereof. We have made no investigation of the laws of any jurisdiction outside Luxembourg as a basis for this opinion and do not express or imply any opinion with respect to the matters governed by or to be determined on the basis of any such laws outside Luxembourg.

This opinion is given by LUTHER and by no other person.

 

I. Documentation:

In connection with this opinion, we have examined the following documents (the “Documents”):

 

A. Articles of association related to the Companies (together the “Articles of Association “):
  (i) a copy of the coordinated version of the articles of association of SIL dated 2 April 2009;
  (ii) a copy of the coordinated version of the articles of association of TAC dated 2 April 2009 ;
  (iii) a copy of the coordinated version of the articles of association of TAI dated 2 April 2009 which articles of association have since been modified by the resolutions of the extraordinary general meeting of the shareholders of TAI held before Maître Francis Kesseler, notary residing in Esch-sur-Alzette, Grand Duchy of Luxembourg, on 29 September 2010;

 

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LUTHER

 

  (iv) a copy of the coordinated version of the articles of association of THOL dated 2 April 2009 which articles of association have since been modified by the resolutions of the extraordinary general meeting of the shareholders of THOL held before Maître Francis Kesseler, notary residing in Esch-sur-Alzette, Grand Duchy of Luxembourg, on 29 September 2010;
  (v) a copy of the coordinated version of the articles of association of TIC dated 2 April 2009
  (vi) a copy of the coordinated version of the articles of association of TOL dated 2 April 2009 which articles of association have since been modified by the resolutions of the extraordinary general meeting of the shareholders of TOL held before Maître Francis Kesseler, notary residing in Esch-sur-Alzette, Grand Duchy of Luxembourg, on 29 September 2010;
  (vii) a copy of the coordinated version of the articles of association of TOSH dated 18 August 2008 which articles of association have since been modified by the resolutions of the extraordinary general meeting of the shareholders held before Maître Francis Kesseler, notary residing in Esch-sur-Alzette, Grand Duchy of Luxembourg, on 29 September 2010;

 

B. Luxembourg Trade and Companies Register excerpts related to the Companies:
  (i) a copy of the Luxembourg Trade and Companies Register excerpt related to SIL dated 24 June 2011;
  (ii) a copy of the Luxembourg Trade and Companies Register excerpt related to TAI dated 24 June 2011;
  (iii) a copy of the Luxembourg Trade and Companies Register excerpt related to TAC dated 24 June 2011;
  (iv) a copy of the Luxembourg Trade and Companies Register excerpt related to THOL dated 24 June 2011;
  (v) a copy of the Luxembourg Trade and Companies Register excerpt related to TIC dated 24 June 2011;
  (vi) a copy of the Luxembourg Trade and Companies Register excerpt related to TOL dated 24 June 2011;
  (vii) a copy of the Luxembourg Trade and Companies Register excerpt related to TOSH dated 24 June 2011;

 

C. Executed certificates of non-registration of judicial decisions (“certificat de non-inscription d’une décision judiciaire”) related to the Companies and delivered pursuant to the law of 19 December 2002:
  (i) a certificate relating to SIL and issued by the Luxembourg Trade and Companies Register on 24 June 2011;
  (ii) a certificate relating to TAI and issued by the Luxembourg Trade and Companies Register on 24 June 2011;

 

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LUTHER

 

  (iii) a certificate relating to TAC and issued by the Luxembourg Trade and Companies Register on 24 June 2011;
  (iv) a certificate relating to THOL and issued by the Luxembourg Trade and Companies Register on 24 June 2011;
  (v) a certificate relating to TAI and issued by the Luxembourg Trade and Companies Register on 24 June 2011;
  (vi) a certificate relating to TOL and issued by the Luxembourg Trade and Companies Register on 24 June 2011;
  (vii) a certificate relating to TOSH and issued by the Luxembourg Trade and Companies Register on 24 June 2011.

 

D. Executed resolutions taken by the board of managers, the managers or by the board of directors of the Companies (together the “Resolutions”):
  (i) a copy of the minutes of a meeting of the board of managers of SIL held on 28 September 2010;
  (ii) a copy of the minutes of a meeting of the board of managers of TAI held on 28 September 2010;
  (iii) a copy of the minutes of a meeting of the board of managers of TAC held on 28 September 2010;
  (iv) a copy of the minutes of a meeting of the board of managers of THOL held on 28 September 2010;
  (v) a copy of the minutes of a meeting of the board of managers of TIC held on 28 September 2010;
  (vi) a copy of the minutes of a meeting of the board of managers of TOL held on 28 September 2010;
  (vii) a copy of the minutes of a meeting of the board of managers of TOSH held on 28 September 2010.

 

E. the Indenture.

Documents referred to under paragraphs A. to D. are referred to as the “Corporate Documents”.

Except as stated above, we have not, for the purposes of this opinion, examined any contracts, deeds, instruments or other documents relating to the Indenture or entered into by or affecting any party to any such contracts, deeds, instruments or documents, or any corporate records of any such party, save that with respect to the Companies, we have reviewed the Corporate Documents available on the internet website of the Luxembourg Trade and Companies Register in respect of the Companies on 24 June 2011 and have not made any other enquiries concerning any such parties. In particular, but without limitation, we have not investigated whether any such parties will, by reason of the transaction contemplated by the Indenture (and any document in connection therewith), be in breach of any of its obligations under any such contracts, deeds, instruments or documents except for the Articles of Association and the Luxembourg law.

 

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LUTHER

 

II. Assumptions:

For purposes of this opinion we assumed each of the following without any further verification:

 

A. That all factual matters and statements relied upon or assumed herein are, and will be true and complete on the date of execution of the Documents (and any documents in connection with);

 

B. That the principal place of business (“principal établissement”) and (for the purposes of the Council regulation (EC) N 1346/2000 of 29 May 2000 on insolvency proceedings (the EU Insolvency Regulation)) the centre of main interests (“centre des intérêts principaux”) of the Companies are located at the place of their registered office (“siège statutaire”) in Luxembourg and that the Companies have no establishment (as such term is defined in the EU Insolvency Regulation) outside Luxembourg;

 

C. That no proceedings for the purposes of a bankruptcy or liquidation has been served on the Companies;

 

D. The originals or copies referred to under section I. of this opinion as well as all signatures are genuine, authentic and complete;

 

E. That the Resolutions are true records of the proceedings described therein;

 

F. That the Resolutions have not been amended, varied, revoked or superseded in any respect and are in full force and effect;

 

G. That the different parties to the Indenture are capable of evaluating and understanding (on their own behalf or through independent professional advice), understand and accept the terms, conditions and risks (whether financial, tax, accounting, regulatory or otherwise) of the Indenture;

 

H. That all authorisations, approvals, notices, filings, registrations, publications and consents of any public authority (other than Luxembourg authorities) required under any applicable laws and/or regulations (other than Luxembourg laws and/or regulations) with respect to the Indenture have been or will be obtained in order to permit the execution or delivery of the Indenture;

 

I. That each of the Companies have a direct corporate interest in the signing of the Indenture to which it is a party and it is in the best corporate interest of the Companies to enter into the contemplated transactions;

 

J. That the Indenture has been entered into for bona fide commercial reasons, on arm’s-length terms and in good faith by each of the parties thereto;

 

K. That the parties entered into the Indenture without any intention to defraud or deprive of any legal benefit, any other parties or to circumvent any applicable mandatory laws or regulations of any jurisdiction;

 

L. That there are no other arrangements or agreements in existence between the parties to the Indenture which in any way amend, add to or vary the terms of the Indenture or the respective rights and interests of the parties thereto.

 

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LUTHER

 

III. Opinion:

Based on the foregoing, and subject to the qualifications stated herein, we are of the opinion that insofar as Luxembourg law is concerned as of the date hereof and without regard to any change in facts and circumstances which may occur subsequent to the issuance of this opinion:

 

A. The Companies have been duly incorporated and are validly existing under the laws of Luxembourg, with power and authority (i) to carry on their activities, (ii) to enter into the Transaction, and (iii) to execute their obligations in connection with the Transaction;

 

B. According to the certificate of non-registration of judicial decisions, no judicial decisions regarding the Company were registered on the date thereof in relation with (i) an insolvency proceedings (“faillite”) within the meaning of Articles 437 ff. of the Luxembourg Commercial Code or any other insolvency proceedings pursuant to the Council regulation (EC) n°1346/2000 of 29 May 2000 on insolvency proceedings, (ii) a controlled management (“gestion contrôlée”) within the meaning of the grand ducal regulation of 24 May 1935 on controlled management, (iii) a voluntary arrangement with their creditors (“concordat préventif de faillite”) within the meaning of the law of 14 April 1886 as amended, (iv) a moratorium or reprieve from payment (“sursis de paiement”) (in accordance with the law dated 20 April 2009); (v) the dissolution, the liquidation of a company, or of the Economic Interest Grouping (“groupement d’intérêts économiques”), or of an European Economic Interest Grouping and other legal entity duly registered, and ordering the appointment of a liquidator, (vi) the close-down in the Grand -Duchy of Luxembourg of an establishment from a foreign company (“fermeture d’un établissement au Grand-Duché de Luxembourg d’une société étrangère”); (vii) a banning pursuant to Article 444-1 of the Luxembourg Commercial Code; (viii) the appointment of an interim director (“administrateur provisoire”) and (ix) any decision regarding the voluntary liquidation of the Company (“liquidation volontaire”);

 

C. Each of the Companies had the necessary corporate power and capacity under its Articles of Association and under Luxembourg law to execute the Indenture to which it is a party;

 

D. Each of the Companies has taken all necessary corporate actions to authorize the entry into and the performance of the Indenture;

 

E. Indenture to which the Companies are parties has been duly and validly approved and executed by each of the Companies;

 

F. Subject to qualification IV (D.) below, no authorisations, approvals, consents, licenses, exemptions, filings, registrations, notarisations and other requirements of governmental, judicial and public bodies and authorities of or in Luxembourg are required in connection with the entry into, performance, validity and enforceability of the Indenture and the Transaction contemplated thereby;

 

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LUTHER

 

G. The execution by each of the Companies of the Indenture to which it is a party (a) does not violate any provision of the Article of Association and (b) does not violate any provision of any applicable law, rule or regulation in the Grand Duchy of Luxembourg;

 

H. No consent, approval or authorization of or designation, declaration of filing with any governmental authority on the part of the Companies is required in connection with the valid execution and delivery of the Indenture.

 

IV. Qualifications:

This opinion is subject to the following qualifications:

 

A. No opinion is given in relation to the validity, perfection and the enforceability of any provisions of the Indenture;

 

B. We express no opinion as to tax laws or regulations whatsoever in respect of the Companies or the tax consequences of the transaction contemplated by the Indenture (or any document in connection therewith);

 

C. The admissibility as evidence of the Indenture before a Luxembourg Court or Public Authority to which the said Indenture is produced may require that the latter be accompanied by a complete or partial translation in the French or German language;

 

D. Registration of the Indenture might be ordered and a registration fee might become payable if the Indenture was to be tabled as evidence before a Luxembourg Court or exhibited before another official authority (“autorité consitutée”) in Luxembourg;

 

E. Corporate documents (including but not limited to, a transfer of the registered office, a notice of a winding-up order or resolution, notice of the appointment of a receiver, director, manager, or administrative receiver, notice of the appointment or revocation of a director) may not be held at the Luxembourg Trade and Companies Register and/or the clerk’s office of the Luxembourg district court (sitting in commercial matters) immediately and there may be a delay in the relevant notice appearing on the files of the relevant party. Consequently, any search conducted at the Luxembourg Trade and Companies Register and/or the clerk’s office of the Luxembourg district court (sitting in commercial matters) can speak only as per date it was carried out and not as per the date of this legal opinion;

 

F. This legal opinion is as of this date and we undertake no obligation to update it or to advise of changes hereafter occurring. We express no opinion as to any matters other than those expressly set forth herein, and no opinion is, or may be, implied or inferred herefrom. We express no opinion as to matters of fact. This legal opinion is strictly limited to the Indenture and does not relate to any extent to any other agreement or matter;

 

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LUTHER

 

G. Luxembourg legal concepts are defined in their original French terms used in Luxembourg laws so that the legal concepts used in the Indenture may not be identical to the Luxembourg legal concepts. Luxembourg Courts may require that decisions granted in other jurisdictions than the Grand-Duchy of Luxembourg or any documents tabled as evidence before Luxembourg Courts be translated into French and German language.

This opinion shall be governed by and construed in accordance with Luxembourg law. The Courts of Luxembourg shall have exclusive jurisdiction to settle any dispute among the parties hereto arising in connection with this opinion.

Yours sincerely,

/s/    Eric Sublon

 

Eric SUBLON

Avocat à la Cour

 

9

EX-5.17 36 dex517.htm EXHIBIT 5.17 Exhibit 5.17

Exhibit 5.17

 

    [Appleby Letterhead]   

e-mail:

mmoller@applebyglobal.com

dbhoyrul@applebyglobal.com

 

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, Colorado 80202

     

direct dial:

Tel: + (230) 203 4300

 

Direct Fax: + (230) 210 8792

 

your ref:

 

appleby ref:

 

402096.0001

 

BY COURIER & EMAIL

Dear Sirs

      24 June 2011

TOMKINS MAURITIUS COMPANY LIMITED (the “Company”)

We have acted as special Mauritius counsel for Tomkins Mauritius Company, a Mauritius Global Business Category 1 Company (the “Guarantor”), in connection with the Registration Statement on Form F-4 to which this opinion has been filed as an exhibit (the “Registration Statement”). The Registration Statement relates to the proposed issuance and exchange (the “Exchange Offer”) of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Exchange Notes”) of Tomkins, Inc., a Delaware corporation, and Tomkins, LLC, a Delaware limited liability company, (collectively, the “Issuers”), for an equal principal amount of outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Initial Second Lien Notes”) of the Issuers, and the guarantee of the Exchange Notes (the “Guarantee”) by, among other entities, the Guarantor(s) pursuant to the Indenture referred to below. The Initial Second Lien Notes have been, and the Exchange Notes will be, issued pursuant to an indenture (the “Indenture”), dated as of September 29, 2010, among the Issuers, the Guarantor and Wilmington Trust FSB, as trustee (the “Trustee”), among other parties, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011 (the “Fifth Supplemental Indenture), the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”)

Tomkins Mauritius Company Limited

24 June 2011

 

In connection with this opinion, we have (i) investigated such questions of law, (ii) examined originals or certified, conformed or reproduction copies of such agreements, instruments, documents and records of the Guarantor, such certificates of public officials and such other documents and (iii) received such information from officers and representatives of the Guarantor and others, in each case, as we have deemed necessary or appropriate for the purposes of this opinion. We have examined, among other documents, the following:

 

  (a) the Indenture and the Guarantee contained therein; and

 

  (b) the form of Exchange Notes attached to the Indenture as an Exhibit.

For the purposes of this opinion we have examined and relied upon the documents listed, and in some cases defined, in the First Schedule to this opinion (the “Documents”).

Assumptions

In stating our opinion we have assumed:

 

(a) the authenticity, accuracy and completeness of all Documents submitted to us as originals and the conformity to authentic original documents of all Documents submitted to us as certified, conformed, notarised, faxed, scanned or photostatic copies;

 

(b) that each of the Documents which was received by electronic means is complete, intact and in conformity with the transmission as sent;

 

(c) the genuineness of all signatures on the Documents;

 

(d) the authority, capacity and power of each of the persons signing the Indenture (other than the Company in respect of the Indenture);

 

(e) that any representation, warranty or statement of fact or law, other than as to the laws of Mauritius, made in any of the Documents is true, accurate and complete other than those that are subject to any of our opinions set forth below;

Tomkins Mauritius Company Limited

24 June 2011

 

(f) that the Indenture constitutes the legal, valid and binding obligations of each of the parties thereto, other than the Company, under the laws of its jurisdiction of incorporation or its jurisdiction of formation;

 

(g) that the Indenture has been validly authorised, executed and delivered by each of the parties thereto, other than the Company, and the performance thereof is within the capacity and powers of each such party thereto, and that each such party to which the Company purportedly delivered the Indenture has actually received and accepted delivery of such Indenture;

 

(h) that the Resolutions are in full force and effect, have not been rescinded, either in whole or in part, and accurately record the resolutions adopted by all the Directors and Shareholders of the Company as unanimous written resolutions of the Board and Shareholders of the Company and that there is no matter affecting the authority of the Directors to effect entry by the Company into the Indenture, not disclosed by the Constitutional Documents or the Resolutions, which would have any adverse implication in relation to the opinions expressed herein;

 

(i) that the Company has entered into its obligations under the Indenture in good faith for the purpose of carrying on its business and that, at the time it did so, there were reasonable grounds for believing that the transactions contemplated by the Indenture would benefit the Company;

 

(j) that each transaction to be entered into pursuant to the Indenture is entered into in good faith and for full value and will not have the effect of preferring, whether fraudulently or not, one creditor over another;

 

(k) that each of the Company’s directors has acted in good faith and in the best interests of the Company in approving and executing the Indenture and each of the Company’s directors has disclosed any interest which he may have in the Indenture in accordance with the provisions of the Companies Act 2001 (the ‘Companies Act’) and/or the Constitutional Documents;

Opinion

Based upon and subject to the foregoing and subject to the reservations set out below and to any matters not disclosed to us, we are of the opinion that:

Tomkins Mauritius Company Limited

24 June 2011

 

(1) The Company is a global licence company and has been incorporated with limited liability and validly existing under the laws of Mauritius. The Company possesses the capacity to sue and be sued in its own name and is in good standing under the laws of Mauritius.

 

(2) The Company is the holder of a category 1 global business licence issued by the Financial Services Commission of Mauritius.

 

(3) The Company has all requisite corporate power and authority under its constitution to enter into, execute, deliver, and perform its obligations under the Indenture and to take all action as may be necessary to complete the transactions contemplated thereby.

 

(4) The execution, delivery and performance by the Company of the Indenture and the transactions contemplated thereby have been duly authorised by all necessary corporate action on the part of the Company.

 

(5) The Indenture to which the Company is a party has been duly executed by the Company.

Reservations

We have the following reservations:

 

(a) Any agreement that the Company will not exercise its statutory powers may constitute an unlawful fetter on the statutory powers of the Company. These powers are powers which are reserved for exercise by the Shareholders of the Company.

 

(b) We express no opinion as to any law other than Mauritius law and none of the opinions expressed herein relates to compliance with or matters governed by the laws of any jurisdiction except Mauritius. This opinion is limited to Mauritius law as applied by the Courts of Mauritius at the date hereof.

 

(c) We express no opinion as to the validity, binding effect of any provision of the Indenture. We express no opinion as to the validity or binding effect of any provision of the Indenture which provide for the severance of illegal, invalid or unenforceable provisions.

Tomkins Mauritius Company Limited

24 June 2011

 

(d) In order to issue this opinion we have requested and received the Certificate of Incumbency and Certificate of Current Standing as referred to in the First Schedule to this opinion and have not enquired as to whether there has been any change since the date such Certificates were produced.

 

(e) In paragraph (1) above, the term “good standing” means that the Company has received Certificate of Current Standing issued by the Registrar of Companies.

Disclosure

This opinion is addressed to you solely for your benefit and is neither to be transmitted to any other person, nor relied upon by any other person or for any other purpose nor quoted or referred to in any public document nor filed with any governmental agency or person, without our prior written consent, except as may be required by law or regulatory authority. This opinion may however be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the registration statement on Form F-4 for Tomkins, Inc. and Tomkins, LLC with respect to the notes offered by Tomkins, Inc. and Tomkins, LLC, and any amendments thereto, including any post-effective amendments to be filed by Tomkins, Inc. and Tomkins, LLC. Moreover, we hereby consent to the filling of this opinion with the U.S Securities Exchange Commission as an exhibit to the registration statement on Form F-4 and to being referenced in the “Legal Matters” section of the registration statement.

Further, this opinion speaks as of its date and is strictly limited to the matters stated herein and we assume no obligation to review or update this opinion if applicable law or the existing facts or circumstances should change.

This opinion is governed by and is to be construed in accordance with Mauritius law. It is given on the basis that it will not give rise to any legal proceedings with respect thereto in any jurisdiction other than Mauritius.

Yours faithfully

/s/ Appleby

Appleby

Tomkins Mauritius Company Limited

24 June 2011

 

FIRST SCHEDULE

 

1. The details included in the Certificate of Current Standing and Certificate of Incumbency, provided by and in respect of the Company.

 

2. Certified copies of the Certificate of Incorporation, Constitution and Category 1 Global Business Licence of the Company (collectively referred to as the “Constitutional Documents”).

 

3. The executed directors’ and shareholders’ resolutions in writing of the Company dated 18 November 2010 authorising entry into, amongst other things, the Indenture (the “Resolutions”).

 

4. A certified copy of the Register of Directors and Members.

 

5. “Certificate of Incumbency” issued by the company secretary of the Company on 15 June 2011 in respect of the Company and stating that as at 15 June 2011:

 

  a. there are no litigation, law suits or court proceedings pending or threatened against the Company;

 

  b. no receiver or liquidator has been appointed to wind up the Company; and

 

  c. the assets of the Company are subject to the encumbrances mentioned in the Register of Mortgages & Charges.

 

6. “Certificate of Current Standing” issued by the Registrar of Companies in respect of the Company stating that as at 20 June 2011 the Company:

 

  a. was duly incorporated on 13 June 2007;

 

  b. name is still on the register, and that it has paid all its fees and dues;

 

  c. has not submitted articles of merger or consolidation that have not yet become effective;

 

  d. is not in the process of being wound up, dissolved , and that no proceedings have been instituted to remove its name; and

Tomkins Mauritius Company Limited

24 June 2011

 

  e. on the evidence of documents filed with the registrar, is in good current standing.

 

7. A copy of each of the executed documents constituting, collectively, the Indenture.
EX-5.18 37 dex518.htm EXHIBIT 5.18 Exhibit 5.18

Exhibit 5.18

[Ritch Mueller, S.C. Letterhead]

June 24, 2011

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, Colorado, 80202

USA

Ladies and Gentlemen:

We have acted as special counsel to AMP Industrial Mexicana, S.A. de C.V. (“AMP Industrial Mexicana”), Aplicadores Mexicanos, S.A. de C.V. (“Aplicadores Mexicanos”), Auto Industrial de Partes, S.A. de C.V., (“Auto Industrial de Partes”), Ruskin de México, S.A. de C.V., (“Ruskin de México”), and Tomkins Poly Belt Mexicana, S.A. de C.V., (“Tomkins Poly Belt Mexicana” and together with AMP Industrial Mexicana, Aplicadores Mexicanos, Auto Industrial de Partes, Ruskin de México and Tomkins Poly Belt Mexicana, the “Companies”), in connection with the issuance of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) by Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly, Pinafore, LLC) and the guarantees of the Notes (the “Guarantees”) by the Companies under an indenture dated as of September 29, 2010, as supplemented by the first supplemental indenture dated as of November 18, 2010, the second supplemental indenture dated as of December 21, 2010, the third supplemental indenture dated as of December 23, 2010, the fourth supplemental indenture dated as of January 20, 2011, the fifth supplemental indenture dated as of February 23, 2011 (the “Fifth Supplemental Indenture”), the sixth supplemental indenture dated as of February 24, 2011 and the seventh supplemental indenture dated as of March 3, 2011 (collectively, the “Indenture”) entered into among the Tomkins, Inc. and Tomkins, LLC, the Guarantors named therein, and Wilmington Trust FSB, as trustee and collateral agent (the “Trustee”), and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended (the “Act”), filed with the Securities and Exchange Commission on June 24, 2011 (the “Registration Statement”).

Capitalized terms used and not otherwise defined herein, shall have the meanings assigned thereto in the Indenture.

In connection with this opinion, we have examined and have relied on originals or copies, certified or otherwise identified to our satisfaction, of such documents, as we have deemed necessary or appropriate as a basis for the opinion hereinafter set forth, including:

 

  (a) the Indenture.

 

  (b) the following public deeds evidencing the articles of incorporation and current by-laws (estatutos sociales) of each of the Companies:

 

  (i) for AMP Industrial Mexicana:
  (A) public deed number 25,776, dated as of May 19, 1988, granted before Notary Public No. 4, Mr. Fernando Díaz Ceballos R., with practice in Mexicali, Baja California, México, recorded in the Public Registry of Commerce of Mexicali, Baja California, under number 7,116, page 439 of Volume XVI, First Book of the Commerce Section, on January 18, 1989, which contains the incorporation of AMP Industrial Mexicana;
  (ii) for Aplicadores Mexicanos:
  (A)

public deed number 379, dated July 25, 1983, granted before Notary Public No. 19, Mr. Alejandro Victor González Bernal, with practice in Ciudad Juárez, Chihuahua, México, recorded in the Public Registry of Commerce of Ciudad Juárez, Chihuahua, under number 15, page 6 of Book No. 256 of the

 

Commerce Section, on January 17, 1984, which contains the incorporation of Aplicadores Mexicanos;

  (B) public deed number 10,852, dated September 8, 2003, granted before Notary Public No. 1, Mr. Aureliano González Baz, with practice in Ciudad Juárez, Chihuahua, México, recorded in the Public Registry of Commerce of Ciudad Juárez, Chihuahua, under number 76, page 129, Volume 126 of the First Book of Commerce, on September 24, 2003, which contains an amendment to article 22 of the articles of incorporation of Aplicadores Mexicanos;
  (C) public deed number 11,018, dated August 30, 2004, granted before Notary Public No. 1, Mr. Aureliano González Baz, with practice in Ciudad Juárez, Chihuahua, México, recorded in the Public Registry of Commerce of Ciudad Juárez, Chihuahua, under electronic file number 1624*3, on October 19, 2004, which contains amendments to articles 2, 9, 11, 12, 13, 14, 17, 19, 20, 21, 22, 24, 25 and 26 of the articles of incorporation of Aplicadores Mexicanos;
  (iii) for Ruskin de México:
  (A) public deed number 3,175, dated February 13, 2004, granted before Notary Public No. 27, Mr. Antonio Suarez Estrada, with practice in Ciudad Juárez, Chihuahua, México, recorded in the Public Registry of Commerce of Ciudad Juárez, Chihuahua, under number 28, page 51, Volume 232 of the First Book of Commerce, on March 1, 2004, which contains the incorporation of Ruskin de México;
  (iv) for Tomkins Poly Belt Mexicana:
  (A) public deed number 38,167, dated October 13, 2004, granted before Notary Public No. 102, Mr. Jose María Morera González, with practice in Mexico City, Mexico, recorded in the Public Registry of Commerce of Mexico City, Mexico, under file number 325,468, on November 24, 2004, which contains the incorporation of Tomkins Poly Belt Mexicana;
  (v) for Auto Industrial de Partes:
  (A) public deed number 40,787, dated January 3, 1978, granted before Notary Public No. 3, Mr. J. Claudio Ibarrola Muro, with practice in Tlalnepantla, Estado de México, Mexico, recorded in the Public Registry of Commerce of Matamoros, Tamaulipas, under number 2004, page 143 of Book No. 63, on January 10, 1978, which includes the incorporation of Auto Industrial de Partes;
  (B) public deed number 22,179, dated April 10, 1985, granted before Notary Public No. 6, Mr. Eduardo Illades Villafaña, with practice in Tijuana, Baja California, recorded in the Public Registry of Commerce of Matamoros, Tamaulipas, under file number 3,909, page 2,038 of Book No. 70, on November 11, 1985, which includes the increase of the capital stock of Auto Industrial de Partes;
  (C) public deed number 22,180, dated April 19, 1985, granted before Notary Public No. 6, Mr. Eduardo Illades Villafaña, with practice in Tijuana, Baja California, recorded in the Public Registry of Commerce of Matamoros, Tamaulipas, under file number 3,910, page 2,039 of Book No. 70, on November 11, 1985, which includes the transformation of Auto Industrial de Partes from a fixed stock capital corporation (Sociedad Anónima) to a variable stock capital corporation (Sociedad Anónima de Capital Variable);
  (D) public deed number 750, dated as of July 31, 1996, granted before Notary Public No. 62, Mrs. Jessica Lilia Deytz Guevara, with practice in Matamoros, Tamaulipas, recorded in the Public Registry of Commerce of Matamoros, Tamaulipas, under file number 875, volume 3-018, of the First Book of Commerce, on December 21, 2005, which includes the amendment to article 5 of the articles of incorporation of Auto Industrial de Partes;

 

  (c) the following public deeds evidencing the formalization of the shareholders meeting minutes of each of the Companies authorizing the execution of the Fifth Supplemental Indenture and granting the necessary powers of attorney for such purposes:

 

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  (i) Public deed number 3,706 dated February 2, 2011, granted before Mrs. Jessica Lilia Deytz Guevara, notary public number 62 for the fourth judicial district of Matamoros, Tamaulipas, in process of registration with corresponding Public Registry of Commerce;
  (ii) Public deed number 3,707, dated February 2, 2011, granted before Mrs. Jessica Lilia Deytz Guevara, notary public number 62 for the fourth judicial district of Matamoros, Tamaulipas, in process of registration with corresponding Public Registry of Commerce;
  (iii) Public deed number 9,656, dated February 3, 2011, granted before Mrs. Odille Corral Andujo, acting on behalf of Mr. Antonio Suárez Estrada, notary public number 27 for the judicial district of Bravos, Chihuahua, in process of registration with corresponding Public Registry of Commerce;
  (iv) Public deed number 49,598, dated February 8, 2011, granted before Mr. Ramiro E. Duarte Quijada, notary public number 10 for Mexicali, Baja California, in process of registration with corresponding Public Registry of Commerce; and
  (v) Public deed number 56,248, dated February 2, 2011, granted before Mr. José María Morera González, notary public number 102 for the City of Mexico, Federal District, in process of registration with corresponding Public Registry of Commerce.

In addition, we have examined and have relied on originals or copies, certified or otherwise identified to our satisfaction, of such corporate records, documents and other instruments of the Companies, as we have deemed necessary for the opinion rendered below. We have not undertaken any independent investigations before any public registries or governmental agencies.

We have assumed, without any independent investigation or verification of any kind, (i) the authenticity and genuineness of all signatures on the documents reviewed by us in connection herewith, other than with respect to the Companies, (ii) the validity, binding effect and enforceability of the Indenture governed by laws other than Mexican laws, under such laws, and that neither the execution of the Indenture nor the performance of the transactions contemplated thereby contravene or are rendered invalid, non binding or unenforceable by any applicable law of any jurisdiction other than the laws of the United Mexican States (“Mexico”), (iii) the due authorization, execution and delivery of the Indenture and related documents by the parties thereto (other than the Companies), (iv) that the by-laws (estatutos sociales) of the Companies contained in the public deeds described in item (b) above have not been further amended and are duly recorded with the Public Registry of Commerce of the corporate domicile of each Company, (v) that each of the powers-of-attorney included in the public deeds described in item (c) above has not been revoked or modified, (vi) the legal capacity of all natural persons executing the Indenture, (vii) the accuracy of the representations and warranties (except the representations (other than factual representations) relating to the Companies) in the Indenture, (viii) that all approvals that are necessary for the validity or enforceability of the Indenture (other than approvals required under the Companies’ bylaws and laws of Mexico), have been obtained and are in full force and effect, (ix) the authenticity of the Indenture and all opinions, documents and papers submitted to us as originals, other than with respect to the Companies, and (x) that copies of all opinions, documents and papers submitted to us are complete and conform to the originals thereof.

We have made no independent investigation of the laws other than the laws of Mexico as a basis for the opinion stated herein and have assumed that there is nothing in any such laws that affects our opinion.

Based upon the foregoing and subject to the assumptions, qualifications and exceptions set forth herein, we are of the opinion that:

1. Each of the Companies has been duly incorporated and each of them validly exists as a sociedad anónima de capital variable under the laws of México.

2. Each of the Companies has the power and authority to enter into the Fifth Supplemental Indenture to become a party under the Indenture and has taken all necessary corporate actions to authorize

 

3

the execution and delivery of the Fifth Supplemental Indenture, and has duly authorized the signatories named therein in its corporate authorizations referred in item (c) above to execute the Fifth Supplemental Indenture.

3. The Companies have duly executed and delivered the Fifth Supplemental Indenture.

The foregoing opinion is subject to the following qualifications:

(a) Enforcement of the Indenture against the Companies may be limited by bankruptcy, concurso mercantil, tax, labour, insolvency, liquidation, reorganisation, moratorium and other laws of general application relating to or affecting the rights of creditors generally;

(b) In any proceeding brought in the courts of Mexico for the enforcement of the Indenture or any judgment related thereto obtained in a foreign jurisdiction against the Companies, a Mexican court would apply Mexican procedural law in such proceedings.

(c) In the event that proceedings are brought in Mexico seeking performance of the Companies’ obligations in Mexico, pursuant to the Mexican Monetary Law, the Companies may discharge its obligations, by paying any sums due in a currency other than Mexican currency, in Mexican currency at the rate of exchange prevailing in Mexico on the date when payment is made and, therefore, any judgment currency or currency indemnity provision contained in the Indenture may not be enforceable in Mexico.

(d) In the event that any legal proceedings are brought to the courts of Mexico, a Spanish translation of the documents required in such proceedings prepared by a court-approved translator would have to be approved by the court after the defendant had been given an opportunity to be heard with respect to the accuracy of the translations, and proceedings would thereafter be based upon the translated documents.

(e) Under the laws of Mexico labor claims, claims of tax authorities for unpaid taxes, Social Security quotas, Workers’ Housing Fund quotas and Retirement Fund quotas will have priority over claims under the Indenture.

(f) Provisions of the Indenture granting discretionary authority to the Trustee cannot be exercised in a manner inconsistent with relevant facts nor defeat any requirement from a competent authority to produce satisfactory evidence as to the basis of any determination; in addition, under Mexican law, each of the Companies will have the right to contest in court any notice or certificate of the Trustee purporting to be conclusive and binding.

(g) We express no opinion as to the collection of interest on interest.

(h) Any provision in the Indenture to the effect that invalidity and illegality of any part thereof will not invalidate the remaining obligations of the Indenture may be unenforceable in Mexico to the extent that such provision constitutes an essential element of the Indenture.

(i) We express no opinion as regards the enforceability of a right of set-off as regards to indirect, contingent or un-matured obligations and liabilities under the Indenture.

(j) The taking of possession, entry, removal, sale, transfer or other disposition of property or similar action in Mexico pursuant to the Indenture may not be made in Mexico without judicial intervention after the defendant is given the right to be heard and defeated in court.

(k) With respect to provisions contained in the Indenture in connection with service of process, it should be noted that service of process by mail does not constitute personal service of process under Mexican law and, since such service is considered to be a basic procedural requirement, if for purposes of proceedings outside Mexico, service of process is made by mail, a final judgment based on such process would not be enforced by the courts of Mexico.

 

4

(l) In a suit brought before Mexican courts, such courts would apply Mexican law on statutes of limitation (prescripción). We express no opinion as to the enforceability in Mexico of a foreign judgment deriving from a lawsuit initiated after the applicable Mexican statute of limitation period has elapsed.

(m) We note that procedural rights cannot be validly waived under Mexican law.

(o) A Mexican court may stay proceeding held in such court if concurrent proceedings are being held elsewhere.

(p) We express no opinion in respect of the availability of self-help or other non-judicial remedies under Mexican law.

(q) Claims may become barred under statutes of limitation or may become subject to defences or set-off or counter claim.

(r) Under the laws of Mexico, the obligations of a guarantor may not exceed the obligations of the main obligor.

We are qualified to practice law only in Mexico and we express no opinion with regard to the laws of any jurisdiction other than Mexico. This opinion is effective as of the date hereof. We express no opinion as to rights, obligations or other matters (including change of law or circumstances) arising subsequent to the date hereof.

This opinion is made for the benefit of and may be relied upon by the addressees thereof. This opinion also may be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the Registration Statement, and any amendments thereto, including any post-effective amendments to be filed by Tomkins, Inc. and Tomkins, LLC with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”). We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name in the prospectus contained under the caption “Legal Matters”. In giving this consent, we do not admit that we are “experts” within the meaning of the Securities Act or within the category of persons whose consent is required by the Securities Act.

Very truly yours,

RITCH MUELLER, S.C.

/s/ Jean Paul Farah

 

Jean Paul Farah, a partner

 

5

EX-5.19 38 dex519.htm EXHIBIT 5.19 Exhibit 5.19

Exhibit 5.19

[Arthur Cox Letterhead]

24 June 2011

Private and Confidential

 

To: Tomkins, Inc.

1551 Wewatta Street

Denver

CO 20202

Tomkins, LLC

1551 Wewatta Street

Denver

CO 20202

 

Re: Registration Statement in respect of the Notes

Dear Sirs,

We act as special counsel to Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly, Tomkins, LLC) (together, the “Issuers”) and Schrader Electronics Limited, a company incorporated in Northern Ireland with registration number NI 025720 (the “Company”), in connection with a registration statement on Form F-4 under the Securities Act of 1933, as amended, filed with the Securities and Exchange Commission (the “Commission”) on 24 June, 2011 (the “Registration Statement”) relating to $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) issued by the Issuers and the guarantees of the Notes (the “Guarantees”) by the Company under an Indenture dated as of September 29, 2010, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”) entered into among the Issuers, the Guarantors named therein (including the Company), and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent.

We are giving this opinion for the sole purpose of filing of the Registration Statement. We give this opinion on the basis and subject to the comments, assumptions and qualifications set out below.

 

1. Basis of Opinion

 

  1A

This opinion is furnished to and may be relied upon by you for your own benefit in connection with the filing of the Registration Statement and may not be relied

 

Page : 1

 

upon or used by any other person or entity without our prior written consent. This opinion may, however, be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the filing of the Registration Statement, and any amendments thereto, including any post-effective amendments to be filed by the Issuers. This opinion may not be transmitted, referred to, quoted from, circulated, copied, filed with, disseminated or disclosed by or to any other person or entity for any purposes without our prior written consent, provided however that a copy of this opinion may be provided to the Commission as an exhibit to the Registration Statement.

 

  1B This opinion is confined to and given in all respects with respect to Northern Irish law in force as at the date hereof as currently applied by the Northern Irish courts (excluding any foreign law to which reference may be made under the rules of the private international law of the United Kingdom). In particular, we express no opinion on the laws of New York or on European Community law as it affects any jurisdiction other than Northern Ireland or any matter of fact. We express no opinion as to the effect of events occurring, circumstances arising or changes of law becoming effective or occurring, after today’s date on the matters addressed in this opinion letter, and we assume no responsibility to inform you of additional or changed facts, or changes in law, of which we may become aware.

 

  1C This opinion is also strictly confined to the matters stated herein and is not to be read as extending, by implication or otherwise, to any other matter.

 

  1D For the purpose of giving this opinion, we have examined the following executed documents (the “Documents”) which term shall mean all or any such documents as appropriate:

 

  (i) an emailed copy of the Indenture, whereby the Company became a party to the Indenture as a New Guarantor;

 

  (ii) an emailed copy of the Registration Statement;

 

  (iii) an emailed copy of a power of attorney dated 15 November 2010 appointing the persons named therein (each an “Attorney”) to act individually as the Company’s attorneys (the “Power of Attorney”);

 

  (iv) copies of the certificate of incorporation, certificate of incorporation on change of name (if any) and the memorandum and articles of association of the Company;

 

  (v) an emailed copy of an officer’s certificate dated 18 November 2010 (the “Officer’s Certificate”) of the Company containing confirmations of various matters relating to the Company and, inter alia:

 

  (a) an emailed copy of a written shareholder resolution dated 17 November 2010 of the Company approving the terms of, the transactions contemplated by and the entry into the Indenture and amending the Company’s Articles of Association; and

 

Page : 2

  (b) an emailed copy of a written resolution of all the directors of the Company dated 15 November 2010, inter alia, approving the terms of, and the transactions contemplated by the Indenture,

and we would stress that for the purpose of issuing this opinion we have placed particular reliance upon the statements and representations and warranties as to factual matters contained in or made pursuant to each of the above mentioned Documents but we express no opinion as to whether any such statements or representations and warranties are true or accurate.

 

  1E For the purpose of giving this opinion, we have inspected the following search reports:

 

  (i) on 23 June 2011 on the file of the Company maintained by the Registrar of Companies in Belfast for mortgages, debentures or similar charges or notices thereof and for the appointment of any receiver, administrator or liquidator;

 

  (ii) on 23 June 2011 in the Chancery Office of the High Court in Belfast, Northern Ireland for any proceedings or petitions filed in the last two years against the Company;

 

  (iii) on 23 June 2011 in the Enforcement of Judgments Office in Belfast, Northern Ireland for unsatisfied judgments, orders, decrees and the like in relation to the Company.

 

  1F We have not conducted any other searches whatsoever in relation to the Company whether relating to land, property or other assets or otherwise nor have we carried out any due diligence or made any further enquiries and accordingly, this opinion is given on the assumption that such searches, due diligence or enquiries (if made) would not reveal any circumstances which would require amendment of this opinion. Furthermore, one cannot rely entirely on the accuracy and completeness of the information disclosed in the searches referred to in paragraph 1E above. This is because such searches do not necessarily contain completely up-to-date information and do not necessarily reveal whether or not a resolution has been passed or petition presented or any other action taken for the winding up of, or the appointment of a receiver or administrator of or to the Company.

 

2. Assumptions

For the purpose of giving this opinion we have made the following assumptions (without any responsibility on our part if any assumption proves to be untrue or incorrect) which we have taken no steps to verify independently.

 

  (i) All Documents submitted to us as originals are authentic, accurate and complete as at the date hereof.

 

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  (ii) All Documents supplied to us as photocopies, facsimile transmitted copies, email transmitted copies or other copies conform to the originals and such originals are authentic, accurate and complete as at the date hereof and the original (if applicable) was executed in the manner appearing on the copy and also the Documents are in identical form to the final drafts submitted to, or by, us.

 

  (iii) The genuineness, completeness and authenticity of all signatures and seals on all original and copy documents which we have examined and the Documents have been delivered by the relevant parties and are not subject to any escrow or other similar arrangement.

 

  (iv) That the person or persons who executed the Indenture on behalf of the Company (or attested the affixing of the seal) are the person(s) who were authorised to do so by the relevant board resolutions and that any seal affixed to same by such Company is genuine.

 

  (v) The Documents contain all relevant information which is material for the purposes of our opinion and there is no other agreement, undertaking, representation or warranty (oral or written) and no other arrangement (whether legally binding or not) made by or between all or any of the parties or any other matter which renders such information inaccurate, incomplete or misleading or which affects the conclusions stated in this opinion letter.

 

  (vi) The truth, completeness and accuracy of all statements as to factual matters contained in the Documents at the time they were made and all times thereafter.

 

  (vii) That the copies produced to us of extracts of minutes of meetings of the Company and/or of resolutions of the Company are true copies and correctly record the proceedings at such meetings and/or the subject matter which they purport to record; and that any meetings referred to in such copies were duly convened and held and quorate, that those directors present at any such meetings were entitled to attend and vote and acted bona fide throughout and declared their interest as directors pursuant to Section 177 and Section 182 of the Companies Act 2006 and that all directors present at meetings of the board of directors of the Company approving the Indenture were duly appointed and had not resigned or been removed from office and that all resolutions set out in such copies were duly passed and that no further resolutions have been passed or corporate or other action taken which would or might alter the effectiveness thereof.

 

  (viii)

The Indenture has been entered into for bona fide commercial reasons for the purpose of legitimately carrying on its business and on arms length terms by the Company and the Company has received adequate commercial benefit as a result of entering into the Indenture and will continue to receive adequate commercial benefit for the duration of same (such commercial benefit being available to the Company in its own right and not merely by reference to benefit generally among the group of companies of which the Company is part), and the directors of the

 

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Company considered in detail the commercial justification for the execution and delivery of the Indenture, the commercial benefit which would be received by the Company and the matters set out in Section 172(1) of the Companies Act 2006, and the directors of the Company in good faith reasonably concluded that such Company would receive adequate commercial benefit as a result of entering into the same and to do so was commercially justified. These are matters of fact on which we express no opinion.

 

  (ix) The Company is able to pay its debts (within the meaning of Article 103 of the Insolvency (Northern Ireland) Order 1989) or any analogous legislation in any relevant jurisdiction at the time of entering into the Indenture and will not become unable to pay its debts in consequence of doing so.

 

  (x) Save for any matters revealed by the searches referred to at paragraph 1E of this letter, the Company has not passed a resolution for its winding up and no proceedings have been instituted or steps taken for the winding up of the Company or for the appointment of an administrator or a receiver in respect of all or any assets of such Company.

 

  (xi) The accuracy and completeness of the information disclosed in the searches referred to in paragraph 1E above and that such information has not since the time of such search or enquiry been altered and that all matters which should be registered with Companies Registry at the date of this opinion have been duly registered against the Company and appear on the searches referred to at 1E (i) above. In this connection, it should be noted that searches at the Companies Registry in Belfast will not necessarily reveal whether or not a prior charge has been created or a resolution has been passed or a petition presented or any other action taken for the winding up of, or the appointment of a receiver, a liquidator, an administrator or an administrative receiver of the Company. Further, the searches referred to at 1E(ii) and (iii) are not conclusively capable of revealing whether or not a winding up petition has been presented, since there is a delay between the presentation of a petition and the date when details of the petition are entered on the relevant records.

 

  (xii) The business which the Company actually carries on is within the terms of its Memorandum and Articles of Association.

 

  (xiii) None of the directors or the secretary of the Company is a person who is disqualified from acting as a director or from managing companies pursuant to the provisions of the Companies (Northern Ireland) Order 1989 or the Company Directors Disqualification (Northern Ireland) Order 2002.

 

  (xiv) The Company is not in arrears with any filings required to be made with Companies Registry in Belfast including, without limitation, the filing of the special resolutions referred to in paragraph 1D above, the filing of notification of the appointment of its directors and secretary and of its annual returns and that the names of the directors, secretary and shareholders of the Company contained in the searches referred to at paragraph 1E (i) are correct and complete.

 

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  (xv) The written resolutions referred to at paragraph 1D have been duly signed for and on behalf of the corporate shareholder (other than those corporate shareholders incorporated in Northern Ireland).

 

  (xvi) The Indenture has been validly executed by the Company in accordance with the laws of the State of New York (being the governing law of the Indenture).

 

  (xvii) The Power of Attorney has not been revoked and remains in full force and effect.

 

3. Qualifications

The opinion set out below is subject to the qualifications set out below.

 

  (i) We have not carried out any investigation or due diligence whatsoever in relation to the Company save as set out in paragraphs 1D and 1E above and this opinion is expressly given upon the terms that no further document is to be examined by us, that no further investigation or due diligence in respect of any matter which may appear on the files of the Company at Companies Registry in Belfast after the date of the above search or which may have appeared on the files of the Company prior to the date of the above search but was not available for actual inspection by us as of such date is required of us by you.

 

4. Opinion

On the basis of and subject to the assumptions and qualifications set out above, we are of the opinion that:

Status, capacity and authority

 

  4A The Company is a limited liability company and is duly incorporated under the laws of Northern Ireland with power and authority to own its own assets and conduct its business.

 

  4B The Company has the necessary corporate capacity under its Memorandum and Articles of Association to execute and deliver the Indenture and to perform its obligations under the Indenture. The execution and performance by the Company of the Indenture does not cause any constitutional limit on the Company or on the powers of the board to be exceeded.

 

  4C All necessary corporate action required on the part of the Company to authorise the execution of the Indenture and the performance by the Company of its obligations under the Indenture have been taken.

Execution

 

  4D Based solely on the confirmations in the Officer’s Certificate, the board resolutions referred to in paragraph 1D above and the Power of Attorney, the Indenture has been duly signed for and on behalf of the Company.

 

Yours faithfully,

  /s/ Arthur Cox

ARTHUR COX

 

 

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EX-5.20 39 dex520.htm EXHIBIT 5.20 Exhibit 5.20

Exhibit 5.20

 

LOGO

    Ulitsa Gasheka, 6

Ducat III, Office 510

Moscow 125047, Russia

Tel: +7.495.785.1234 Fax: +7.495.785.1235

www.lw.com

  

 

FIRM / AFFILIATE OFFICES

 

June 24 2011

 

Tomkins, LLC

Tomkins, Inc.

 

1551 Wewatta Street

Denver, Colorado 80202

United States

    Abu Dhabi

Barcelona

Beijing

Boston

Brussels

Chicago

Doha

Dubai

Frankfurt

Hamburg

Hong Kong

Houston

London

Los Angeles

Madrid

Milan

    Moscow

Munich

New Jersey

New York

Orange County

Paris

Riyadh

Rome

San Diego

San Francisco

Shanghai

Silicon Valley

Singapore

Tokyo

Washington, D.C.

 

  Re: Registration Statement on Form F-4 relating to the $1,150,000,000 9% Senior Secured Second Lien Notes due 2018 (the “New Notes”) of Pinafore, LLC and Pinafore, Inc. (together, the “Issuers”)

Dear Sirs:

We have acted as special Russian law counsel to the Issuers and Gates CIS LLC (the “Russian Guarantor”), in connection with the filing of the registration statement on Form F-4 filed on June 24 2011 by the Issuer and its co-registrants listed therein with the Securities and Exchange Commission (the “SEC”) under the United States Securities Act of 1933, as amended (the “Securities Act”), as the same may be amended from time to time (the “Registration Statement”). The New Notes and the guarantees thereof are to be issued pursuant to the terms of the indenture dated 29 September 2010 as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011, filed as exhibits to the Registration Statement and entered into between, among others, the Issuers, the Guarantors party thereto and Wilmington Trust FSB as trustee (collectively, the “Indenture”). Upon the Registration Statement becoming effective pursuant to the Securities Act, the Issuer will offer to exchange up to $1,150,000,000 in aggregate principal amount of the New Notes and the related Guarantees for up to $1,150,000,000 in aggregate principal amount of the Issuer’s outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Existing Notes”) and the related Guarantees thereof.

This letter is being rendered to you pursuant to Form F-4 and Reg S-K Item 601(b)(5) of the Securities Act.

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The terms defined in the Indenture, unless the context otherwise requires, shall have the same meanings when used in this letter.

 

  1. Scope and Limitations

In rendering the opinions set forth herein, we have examined such matters of fact and questions of law as we have considered necessary or appropriate.

We have examined, among other things, originals or copies certified or otherwise identified to our satisfaction of such documents, certificates and records as we have deemed necessary or appropriate, including without limitation the following:

 

  (a) an executed copy of the Indenture;

 

  (b) a copy of the Registration Statement.; and

 

  (c) the documents listed in Schedule A hereto.

As to facts material to the opinions and confirmations expressed herein, we have, with your consent, relied upon oral and written statements and representations of officers and other representatives of the Russian Guarantor and others, including without limitation the representations and warranties of the Russian Guarantor in certificates of their respective officers. With respect to any references herein as to legal or governmental proceedings, approvals, consents or judgments, awards, orders, decrees, permits, licenses, authorizations, registrations, declarations or filings we have, with your consent, made no inspection of the records or dockets of any court, tribunal or governmental agency or body, but instead have relied upon inquiries and discussions with officers and other representatives of the Russian Guarantor responsible for such matters, our review of documents furnished to us by the Russian Guarantor and certificates of appropriate public officials and officers and representatives of the Russian Guarantor. We have not independently verified such factual or legal matters.

This letter and the matters addressed herein speak as of the date hereof or such earlier date as is specified herein, and we undertake no, and hereby disclaim any, obligation to advise you of any change in any matter set forth herein, whether based on a change in the law, a change in any fact relating to the Russian Guarantor or any other person, or any other circumstance. This letter is limited to the matters expressly stated herein and no opinions or confirmations are to be inferred or may be implied beyond the opinions or confirmations expressly set forth herein.

The opinions set forth herein are limited to the federal legislation of the Russian Federation, the full text of which has been officially published prior to the date of this letter and is in full force and effect on the date hereof. The term “Applicable Laws” shall refer to any such federal legislation of the Russian Federation that is normally applicable to transactions of the same type as the transactions contemplated by the Indenture and the Supplemental Indenture. We express no opinion as to, and the term “Applicable Laws” shall not include any reference to, the laws of any jurisdiction other than the Russian Federation, any laws of the Russian Federation relating to taxation or customs, or any laws of any political subdivision of or within the Russian Federation (the “Excluded Laws”) and we express no opinion with respect to the applicability to or the effect on the Applicable Laws of the Excluded Laws. We express no opinion with respect to, or in the event of: (i) a change after the date hereof by authorized officials of the Russian Federation in the interpretation of any federal legislation, or any such prior change officially published first after the date

 

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hereof; (ii) the adoption after the date hereof of retroactive federal legislation by authorized officials of the Russian Federation; (iii) an application after the date hereof of any federal legislation by authorized officials in a manner inconsistent with a previous application thereof; (iv) conflicts between federal laws; (v) conflicts between federal, regional and local legislation; or (vi) a breach of law or regulation in circumstances in which the Russian Guarantor, its shareholders, directors or officers interpreted applicable laws and regulations following general business practices current in the Russian market at the time they were made in the bona fide and reasonable belief that such practices were not contrary to the federal legislation. Furthermore, we express no opinion as to the interpretation by any court of the Russian Federation of Russian legislation or regulations. Any reference in this letter to the laws of the Russian Federation, Russian law or Applicable Laws are limited as set forth in this paragraph.

We express no opinion as to whether a court in the Russian Federation will give effect to the tax gross-up provision contained in the Indenture.

 

  2. Assumptions

In this letter we have with your consent assumed (without making any investigation) that:

 

  (a) all signatures and seals on all documents submitted to us are genuine and were affixed and engrossed at the time of purported execution of such documents by the persons listed therein as signatories; and that such persons had the legal capacity (deesposobnost) to act;

 

  (b) all documents submitted to us as originals are authentic and all documents submitted to us as copies of originals are complete and conform to the authentic original documents;

 

  (c) the parties to the Indenture have been duly organized, are validly existing and in good standing and have the corporate power to enter into and to perform their respective obligations under the Indenture and the Supplemental Indenture; provided that we make no such assumption to the extent we have specifically opined as to such matters with respect to the Russian Guarantor herein;

 

  (d) the directors, officers, representatives or agents of any legal entities executing or appearing in any of the documents we have examined were validly assigned or appointed to their respective positions and were not dismissed or did not resign by the time of execution of the relevant documents, were duly authorized to execute the documents on behalf of the relevant legal entities, and such execution by them constituted due execution of such documents; provided that we make no such assumption to the extent we have specifically opined as to such matters with respect to the Russian Guarantor herein;

 

  (e) each of the parties to the Indenture has duly authorized, executed and delivered the Indenture , including that the execution of the Indenture by each of the relevant signatories was duly authorized by the party which such signatory purported to represent; provided that we make no such assumption to the extent we have specifically opined as to such matters with respect to the Russian Guarantor herein;

 

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  (f) the Indenture constitutes the legally valid and binding agreement of each of the parties thereto, enforceable against each of them in accordance with their terms, under the law by which the Indenture is expressed to be governed;

 

  (g) in entering into the Indenture, the Russian Guarantor has fully complied with its internal procedures and policies with respect to entering into agreements;

 

  (h) with respect to the meetings of any entities’ governing bodies the records of which we have examined, the notice and other procedural requirements for the convocation and holding of such meetings and voting thereat were duly observed in accordance with such entities’ constituent documents and applicable laws, and that such records are true, accurate and complete records of the proceedings described therein; and that no decisions of such entities’ governing bodies made at such meetings have been subsequently reversed, invalidated, superseded, modified or otherwise altered;

 

  (i) each party to the Indenture (i) has obtained all regulatory and other consents, permits, licenses and authorisations from, and made all registrations, declarations or filings with, governmental authorities, under all applicable laws and regulations, that may be required for such party to enter into and perform its obligations under the Indenture , to carry on its business as presently carried on and to submit to the Specified Courts; and all the consents, permits, licenses and authorisations so obtained are in full force and effect and the terms thereof are complied with; and (ii) has complied with all applicable laws, statutes, rules, regulations or court or governmental orders; and (iii) is not in breach of, or default under, any of its agreements or instruments; provided that we make no such assumption to the extent we have specifically opined as to such matters with respect to the Russian Guarantor;

 

  (j) the state officials issuing any of the documents we have examined or carrying out each registration or authorisation listed or referred to in such documents were validly commissioned at the time of their acting in such capacity and were duly authorized and empowered to issue such documents or to carry out such registrations or authorisations on behalf of the state authority appearing on the face of each such document; such state officials were not dismissed or did not resign by the time of execution of the relevant documents; all documents and information provided to state authorities that formed part of the basis on which such state authorities took any decision or issued any of the documents we have examined were accurate and complete; all documents issued by such state authorities were within their respective competence; and all applicable laws, regulations and procedures were complied with in connection with the issuance of each such document or the effecting of each such registration or authorisation;

 

  (k) none of the documents we have examined has been amended, rescinded, withdrawn or revoked and each of them continues in full force and effect as of the date hereof, and no documents or instruments have been issued which replace or otherwise alter the content of the documents we have examined or would affect the opinions and confirmations expressed in this letter;

 

  (l)

there are no collateral or other arrangements between the parties to the documents we have examined, which modify or supersede any of the terms of

 

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such documents or would affect the opinions and confirmations expressed in this letter; and such documents are performed by the parties thereto in accordance with their terms;

 

  (m) each party to the Indenture is solvent and able to pay all its debts as they fall due, and that none of the parties to the Indenture have taken any corporate or other action, nor have any steps been taken or legal proceedings been commenced, for the administration, bankruptcy, insolvency, liquidation, dissolution, reorganisation, fraudulent transfer, moratorium or other similar procedure or laws affecting the rights or remedies of creditors;

 

  (n) all statements as to factual matters expressed in the documents we have examined are true and accurate;

 

  (o) the documents we have examined contain all relevant information which is material for the purposes of this letter and there is no other agreement, undertaking, representation or warranty (oral or written) or arrangement or understanding (whether or not legally binding) between all or any of the parties or any other matter which renders such information inaccurate, incomplete or misleading or which affects the opinions and confirmations expressed in this letter; and

 

  (p) all the documents we have examined and any transactions and arrangements contemplated thereby were freely entered into in good faith by each of the parties thereto; that no fraud, dishonesty, forgery, coercion, duress or breach of fiduciary duty has existed or will exist with respect to any of the matters relevant to the opinions and confirmations expressed in this letter; and that none of the parties to any of such documents was, is or will be seeking to achieve any purpose not apparent from such documents which might render such documents illegal or void.

 

  3. Opinions and Confirmations

Based upon the foregoing, and subject to the assumptions, qualifications and limitations stated herein, we are of the opinion that:

 

  (a) Based solely on our inspection of the Charter, the Extract and the Certificates, the Russian Guarantor is a legal entity registered and existing in the form of a limited liability company under the Applicable Laws.

 

  (b) The Russian Guarantor has the corporate capacity, power and authority to enter into the Indenture and perform its obligations thereunder.

 

  (c) Peter Verdonckt, General Director of the Russian Guarantor, and Kirill Khaliavin, Chief Accountant of the Russian Guarantor, were duly authorised to sign the Indenture on behalf of the Russian Guarantor and their signatures are binding on the Russian Guarantor.

 

  4. Qualifications

The opinions and confirmations in this letter are subject to the following limitations, qualifications and exceptions:

 

  (a)

The state of legislation of the Russian Federation governing economic activities is constantly changing, is uncertain and reflects the transition that the Russian economy and the Russian government are undergoing. These factors sometimes cause rapid

 

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change in applicable laws, failure or delay in adopting implementing regulations and judicial interpretation thereof and adoption of a significant number of new laws and regulations, sometimes with retroactive effect. In addition, the legal system of the Russian Federation generally and some of its judges in particular are still unfamiliar with and inexperienced in certain commercial law terminology, concepts and practices used or reflected in the Indenture and Russian courts have little experience in applying the law of foreign jurisdictions. Therefore, it is difficult to predict with any certainty whether a court in the Russian Federation would apply the laws of the State of New York in a dispute where the opposing parties are Russian citizens or legal persons and how the Indenture and the rights and obligations of the parties thereunder would be interpreted by any judge or arbitrator in the Russian Federation. We have assumed that (i) state authorities have the competence and jurisdiction that they explicitly or implicitly assert, (ii) published or publicly available laws will be interpreted and applied and enforced substantially in the manner in which they are written and without outside interference or influence, and (iii) ambiguities and inconsistencies will be resolved with due consideration given to matters of materiality, reasonableness, fairness, fair dealing, good faith, public policy and order and the commercial expectations of the parties as evidenced by their agreements. Enforcement of laws in the Russian Federation may differ from region to region within the Russian Federation and may depend on and be subject to the interpretation placed upon such laws by the state authority deciding whether enforcement is available, and such authority may adopt an interpretation of an aspect of Russian law that differs from the opinions stated herein.

 

  (b) Under Russian law, rights may be exercised by the person to whom they are granted in that person’s absolute discretion. A waiver or other relinquishing by any person of its rights generally will not prevent their exercise by that person, and the Russian courts generally will not order specific performance of such waivers. It is not clear whether breach of an obligation resulting from the exercise of waived rights would give rise to liability for damages.

 

  (c) The opinions set out in this letter are subject to any limitations arising from applicable laws relating to insolvency, bankruptcy, administration, reorganisation, liquidation or analogous circumstances.

 

  5. Addressees

This letter is addressed to you solely for your benefit in connection with the Registration Statement. This letter may not be relied upon by you for any other purpose, or furnished to, or assigned to or relied upon by any other person, firm or entity for any purpose (including, without limitation, by any person, firm or other entity that acquires Notes from you), without our prior written consent, which may be granted or withheld in our discretion. Notwithstanding the above, this letter may be relied upon by Latham & Watkins LLP in connection with the filing of the Registration Statement and its opinion with respect to the validity of the securities being registered thereunder. We hereby consent to the filing of this letter as an exhibit to the Registration Statement and to the use of our name in the prospectus contained under the caption “Legal matters”. In giving such consent, we do not thereby admit that we are included in the category of persons whose consent is required under section 7 of the Securities Act or the rules and regulations of the SEC promulgated thereunder.

 

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Very truly yours,

/s/ Latham & Watkins LLP

 

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Schedule A

 

  1. A copy of the charter of Gates CIS LLC approved by the sole participant on February 1, 2010 (the “Charter”).
  2. A copy of the extract from the Unified State Register of Legal Entities dated 15 June 2011, with respect to Gates CIS LLC (the “Extract”).
  3. A copy of the certificate dated 09 June 2007 of registration of Gates CIS LLC in the Unified State Register of Legal Entities under Main State Registration Number 5077746897113.
  4. A copy of the certificate dated 09 June 2007 of registration of Gates CIS LLC in tax authorities under tax identification number 7705795461 (the certificates listed in items 3 and 4 are herein together referred to as the “Certificates”).
  5. A copy of the Minutes of the meeting of the Board of Directors of Gates CIS LLC dated 8 February 2010 on appointment of Mr. Peter Verdonkt as the General Director of Gates CIS LLC for the new term.
  6. A copy of the Order No. 004 dated 1 October 2007 on appointment of Mr. Kirill Khaliavin as the financial manager with chief accountant functions.
  7. A copy of the resolution of the sole participant of Gates CIS LLC dated 15 December 2010 approving, inter alia, the Indenture as a major transaction.

 

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EX-5.21 40 dex521.htm EXHIBIT 5.21 Exhibit 5.21

Exhibit 5.21

[Hergüner Bilgen Özeke Letterhead]

24 June 2011

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, Colorado 80202

Re: Guarantees by Turkish Guarantors in connection with 9 % Senior Secured Second Lien Notes due 2018

Dear Sir/Madam:

At your request, we have acted as special legal counsel in the Republic of Turkey for Tomkins, Inc. and Tomkins, LLC (“Issuers”); in connection with the exchange of $1.15 billion aggregate principal amount of 9 % Senior Secured Second Lien Notes due 2018 (“Old Lien Notes”) issued by the Issuers, which were privately placed, into new 9% Senior Secured Lien Notes due 2018 (“Exchange Notes”), and through the registration of the Exchange Notes before the U.S. Securities and Exchange Commission (“SEC”) as per the U.S. Securities Act of 1933 (“Securities Act”); through the following documents whereby two Turkish entities, namely, Gates Powertrain Plastik Metal ve Makina Sanayii ve Ticaret Limited Şirketi (“Gates Powertrain”), and Gates Güç Aktarim Sistemleri Dağitim Sanayi ve Ticaret Limited Şirketi (“Gates Güç”) (Gates Powertrain and Gates Güç hereinafter collectively referred to as the “Turkish Guarantors”) have provided guarantees in connection with the Exchange Notes:

(i) the Indenture dated 29 September 2010 , and signed by and between, among others, the Borrowers as Issuers, Pinafore Holdings, B.V. as Holdings, and Wilmington Trust FSB (“Wilmington”) as Trustee and Collateral Agent; as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011 (the “Fifth Supplemental Indenture”), the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, including the guarantees of the Exchange Notes contained therein, the “Indenture”) to which the Turkish Guarantors have acceded as Note Guarantors with the Fifth Supplemental Indenture (defined below);

Unless otherwise defined hereunder, capital terms used herein shall bear the same meaning as ascribed to them in the Indenture.

Pursuant to the Indenture, the parties thereof have agreed on the terms and conditions of the issuance, authentication and delivery of the Second Lien Notes

Pursuant to the Fifth Supplemental Indenture, the Turkish Guarantors have acceded to the Indenture, and have agreed to guarantee the obligations of the Issuers under the Indenture.

 

I. In connection with the foregoing and in our capacity as special counsel in the Republic of Turkey for the Issuers we have examined the following documents:

 

  (a) the copy of the executed Indenture;

 

  (b) the copy of the registration statement on Form F-4 filed by the Issuers to SEC;

 

  (c) the documents listed in the Annex I (List of Reviewed Documents).

 

II. This legal opinion is also based on each of the following assumptions and qualifications:

 

  (a) We have not independently verified the authenticity of the documents reviewed; and we have assumed that all documents submitted to us as originals to be genuine, and authentic, and all documents submitted to us as copies or specimen documents to be in conformity with the originals, and in each case containing authentic signatures and executed in identical form to the version examined for purposes hereof;

 

  (b) We have solely relied upon the documents provided to us and listed in Section I above and we have not undertaken any investigation of governmental records or other public records and have relied upon the statements of the corporate counsels and the officers of the Turkish Guarantors that documents and information provided to us are accurate and up to date;

 

  (c) The documents listed under Section I upon which we have expressed reliance continue to be accurate and have not been revoked;

 

  (d) Insofar as laws other than the laws of the Republic of Turkey are concerned, each party to the Indenture has obtained all authorizations, corporate or otherwise, required under the laws of any jurisdiction (other than the Republic of Turkey) in order to be a party to the Indenture;

 

  (e) Insofar as laws other than the laws of the Republic of Turkey are concerned, the Indenture constitutes a legal, valid, binding, and enforceable obligation of the parties thereto under such laws; and

 

2

  (f) To the extent any obligation under the Indenture is required to be performed in any jurisdiction outside the Republic of Turkey, its performance will not be illegal or ineffective by virtue of the laws of such jurisdiction.

 

III. Based upon each of the foregoing examination and assumptions and subject to the qualifications set forth herein, we are of the opinion that:

 

  (a) The Turkish Guarantors are limited liability partnerships (limited şirket) duly incorporated, organized and validly existing under the laws of the Republic of Turkey, and are duly registered and duly qualified to transact business in good standing in the Republic of Turkey.

 

  (b) Each of the Turkish Guarantors has taken all requisite corporate action necessary to authorize the transactions contemplated in the Indenture and to execute, deliver and perform all of its obligations under the Indenture to which it is a party.

 

  (c) Each of the Turkish Guarantors has duly and validly authorized, executed and delivered the Indenture; and has all requisite corporate power and authority to execute, deliver and perform its obligations under the Indenture and to consummate the transactions contemplated thereby;

 

  (d) The respective articles of associations of (i) Gates Powertrain, as amended for the last time with the Partners Resolution dated 28 December 2010, announced in the Trade Registry Gazette dated 7 January 2011, and (ii) Gates Güç, as amended for the last time with the Partners Resolution dated 15 March 2011, announced in the Trade Registry Gazette dated 21 March 2011; are compatible with the purposes of, and the transactions contemplated under, the Indenture.

We are members of the Bars of the Republic of Turkey and express no opinion as to matters governed by any laws other than the laws of the Republic of Turkey. This opinion is limited to the laws of the Republic of Turkey and interpretations thereof in effect on the date hereof, and we assume no obligation to revise or supplement this legal opinion should any such law or interpretation be changed by legislative action, judicial decision or otherwise.

This opinion is being delivered at the request of the Issuers; for the benefit of the Issuers and their legal successors and assigns, which may rely on this opinion as though addressed to such person on the date hereof; and may not be relied upon by you for any other purpose, or relied upon by, or furnished to, any other person, firm or corporation, except to SEC, without our prior written consent. Provided, however, that this opinion may be relied upon by Latham & Watkins LLP in the issuance of its opinion letter in connection with the registration statement on Form F-4 for Tomkins, Inc. and Tomkins, LLC with respect to the notes offered by Tomkins, Inc. and Tomkins, LLC, and any amendments thereto, including any post-effective amendments to be filed by Tomkins, Inc. and Tomkins, LLC. Moreover, we hereby consent to the filling of this opinion with the U.S Securities

 

3

Exchange Commission as an exhibit to the registration statement on Form F-4 and to the reference to our firm contained under the heading “Legal Matters” in the prospectus contained in the registration statement on Form F-4..

We do not assume any responsibility under any laws, apart from Turkish law, to any persons in connection with this opinion.

Yours Sincerely,

/s/ Hergüner Bilgen Özeke

Hergüner Bilgen Özeke

 

4

Annex I

List of Reviewed Documents

 

1. Corporate Documents of Gates Powertrain:

 

  (a) Certificate of Activity dated 31 January 2011, issued by the Istanbul Trade Registry

 

  (b) Articles of Association notarized by the 24th Notary Public of Beyoğlu on 12 February 2009 under registration no 10044, together with (i) the Trade Registry Gazette dated 16 October 2008, (ii) the Trade Registry Gazette dated 14 December 2009, (iii) the Trade Registry Gazette dated 7 January 2010, and (iv) the Trade Registry Gazette dated 7 January 2011 with respect to amendments to the Articles of Association.

 

  (c) Signature Circular notarized by the 30th Notary Public of Izmir on 26 November 2010 under registration no. 35038

 

  (d) Partners Resolution dated 9 February 2011, numbered 8, certified by the 35th Notary Public of Beyoğlu under registration no. 7988

 

  (e) Power of Attorney dated 27 January 2011, notarized by the 30th Notary Public of Izmir on 27 January 2011 under registration no. 3408, issued by Ionut Cristian Stefan as the authorized signatory of Gates Powertrain

 

2. Corporate Documents of Gates Güç:

 

  (a) Certificate of Activity dated 9 February 2011, issued by the Istanbul Trade Registry

 

  (b) Articles of Association notarized by the 24th Notary Public of Beyoğlu on 21 May 2009 under registration no 23539, together with the Trade Registry Gazette dated 12 July 2010 with respect to amendment to the Articles of Association

 

  (c) Signature Circular notarized by the 30th Notary Public of Izmir on 30 November 2010 under registration no. 35465

 

  (d) Partners Resolution dated 17 January 2011, numbered 4, certified by the 15th Notary Public of Beyoğlu under registration no. 2778

 

  (e) Power of Attorney dated 27 January 2011, notarized by the 30th Notary Public of Izmir on 27 January 2011 under registration no. 3408, issued by Ionut Cristian Stefan as the authorized signatory of Gates Güç

 

5

EX-5.23 41 dex523.htm EXHIBIT 5.23 Exhibit 5.23

Exhibit 5.23

[Dinsmore & Shohl LLP Letterhead]

 

Brady W. Dunnigan
859-425-1063
Brady.Dunnigan@dinslaw.com

June 24, 2011

Tomkins, Inc.

Tomkins, LLC

1551 Wewatta Street

Denver, CO 80202

Ladies and Gentlemen:

We have acted as special counsel in the Commonwealth of Kentucky to Koch Filter Corporation, a Kentucky corporation (the “Company”), in connection with the issuance of $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (the “Notes”) by Tomkins, Inc. (formerly Pinafore, Inc.) and Tomkins, LLC (formerly, Pinafore, LLC) and the guarantees of the Notes (the “Guarantees”) by the Company under an Indenture dated as of September 29, 2010, as supplemented by the First Supplemental Indenture dated as of November 18, 2010, the Second Supplemental Indenture dated as of December 21, 2010, the Third Supplemental Indenture dated as of December 23, 2010, the Fourth Supplemental Indenture dated as of January 20, 2011, the Fifth Supplemental Indenture dated as of February 23, 2011, the Sixth Supplemental Indenture dated as of February 24, 2011 and the Seventh Supplemental Indenture dated as of March 3, 2011 (collectively, the “Indenture”) entered into among the Issuers, the Guarantors named therein, and Wilmington Trust FSB, as trustee (the “Trustee”) and collateral agent, and pursuant to a registration statement on Form F-4 under the Securities Act of 1933, as amended (the “Act”), filed with the Securities and Exchange Commission (the “Commission”) on June 24, 2011 (Registration No. 333-______) (the “Registration Statement”).

In connection with rendering this opinion, we have examined copies, certified or otherwise identified to our satisfaction, of the following:

 

  (a) the Registration Statement;

 

  (b) the Indenture;

 

  (c) the Notes;

 

  (d) the Articles of Incorporation, as amended, of the Company, certified by the Secretary of State of the Commonwealth of Kentucky on June 23, 2010 and certified by the Secretary of the Company as now in effect and as in effect at the time of the adoption of the resolutions of the board of directors of the Company referred to in paragraph (f) below;

June 24, 2011

Page 2

 

  (e) the Bylaws of the Company, certified by the Secretary of the Company as now in effect;

 

  (f) copies of certain resolutions of the board of directors of the Company adopted on September 20, 2010, and certified by the Secretary of the Company, which resolutions have not been amended, superseded or revoked;

 

  (g) a certificate dated June 23, 2011, of the Secretary of State of the Commonwealth of Kentucky as to the entity status and good standing of the Company, and

 

  (h) such other documents, certificates and records as we have deemed necessary or appropriate as a basis for the opinions set forth herein.

In such examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, conformity to the original documents of all documents submitted to us as copies and the authenticity of the originals of such latter documents. As to any facts material to our opinion, we have, when relevant facts were not independently established, relied upon the aforesaid records, certificates and documents.

Based upon the foregoing and subject to the assumptions, exceptions, qualifications and limitations set forth hereinafter, we are of the opinion that:

1.    The Company is a corporation validly existing and in good standing under the laws of the Commonwealth of Kentucky.

2.    The Company has the corporate power and authority under the laws of the Commonwealth of Kentucky to execute and deliver, and perform all of its obligations under, the Indenture (including the guarantees by the Company of the Notes).

3.    The Indenture (which includes the guarantee by the Company of the Notes) have been duly authorized, executed and delivered by the Company under the laws of the Commonwealth of Kentucky.

The opinion in paragraph 1 above is based solely upon our review of certificates and other communications from officials of the Commonwealth of Kentucky. The opinions expressed herein are as of the date hereof only and are based on laws, orders, contract terms and provisions, and facts as of such date, and we disclaim any obligation to update this opinion letter after such date or to advise you of changes of facts stated or assumed herein or any subsequent changes in applicable law.

June 24, 2011

Page 3

Our opinion set forth herein reflects only the application of applicable Kentucky state law (excluding the securities and blue sky laws of such state, as to which we express no opinion) and the federal laws of the United States of America. The opinion set forth herein is made as of the date hereof and is subject to, and may be limited by, future changes in the factual matters set forth herein, and we undertake no duty to advise you of the same. The opinion expressed herein is based upon the law in effect (and published or otherwise generally available) on the date hereof, and we assume no obligation to revise or supplement this opinion should such law be changed by legislative action, judicial decision or otherwise. In rendering our opinion, we have not considered, and hereby disclaim any opinion as to, the application or impact of any laws, cases, decisions, rules or regulations of any other jurisdiction, court or administrative agency.

We do not render any opinions except as expressly set forth above. The opinions set forth herein are made as of the date hereof. We hereby consent (i) to being named in the Registration Statement and in any amendments thereto as counsel for the Company, (ii) to the statements with reference to our firm made in the Registration Statement, (iii) to the filing of this opinion as an exhibit to the Registration Statement, and (iv) to allow Latham & Watkins LLP to rely on this opinion. In giving such consent, we do not thereby concede that we are within the category of persons whose consent is required under Section 7 of the Act or the Rules and Regulations of the Commission thereunder.

 

 

Very truly yours.

 

/s/ Brady W. Dunnigan

 

DINSMORE & SHOHL LLP

 EX-10.6 42 dex106.htm EXHIBIT 10.6 Exhibit 10.6

Exhibit 10.6

EXECUTION VERSION

 

 

U.S. SECOND LIEN NOTES SECURITY AGREEMENT

dated as of

September 29, 2010

among

THE GRANTORS IDENTIFIED HEREIN

and

WILMINGTON TRUST FSB,

as Collateral Agent

 

 

TABLE OF CONTENTS

 

              Page  
     ARTICLE I   
     DEFINITIONS   
 

Section 1.01

    Indenture      1   
 

Section 1.02

    Other Defined Terms      1   
     ARTICLE II   
     PLEDGE OF SECURITIES   
 

Section 2.01

    Pledge      6   
 

Section 2.02

    Delivery of the Fledged Securities      7   
 

Section 2.03

    Representations, Warranties and Covenants      8   
 

Section 2.04

    Certification of Limited Liability Company and Limited Partnership Interests      9   
 

Section 2.05

    Registration in Nominee Name: Denominations      9   
 

Section 2.06

    Voting Rights; Dividends and Interest      9   
 

Section 2.07

    Intercreditor Agreement      11   
     ARTICLE III   
     SECURITY INTERESTS IN PERSONAL PROPERTY   
 

Section 3.01

    Security Interest      11   
 

Section 3.02

    Representations and Warranties      13   
 

Section 3.03

    Covenants      14   
     ARTICLE IV   
     REMEDIES   
 

Section 4.01

    Remedies Upon Default      16   
 

Section 4.02

    Application of Proceeds      18   
 

Section 4.03

    Grant of License to Use Intellectual Property      18   
     ARTICLE V   
     SUBORDINATION   
 

Section 5.01

    Subordination      19   

     ARTICLE VI   
     MISCELLANEOUS   
 

Section 6.01

    Notices      19   
 

Section 6.02

    Waivers: Amendment      19   
 

Section 6.03

    Collateral Agent’s Fees End Expenses; Indemnification      19   
 

Section 6.04

    Successors and Assigns      20   
 

Section 6.05

    [Reserved]      20   
 

Section 6.06

    Counterparts; Effectiveness; Several Agreement      20   
 

Section 6.07

    Severability      20   
 

Section 6.08

    Right of Set-Off      20   
 

Section 6.09

    Governing Law; Jurisdiction; Venue; Waiver of Jury Trial; Consent to Service of Process      21   
 

Section 6.10

    Headings      21   
 

Section 6.11

    Security Interest Absolute      21   
 

Section 6.12

    Termination or Release      21   
 

Section 6.13

    Additional Grantors      22   
 

Section 6.14

    Collateral Agent Appointed Attornev-in-Fact      22   
 

Section 6.15

    General Authority of the Collateral Agent      23   
 

Section 6.16

    Reasonable Care      23   
 

Section 6.17

    Reinstatement      23   
 

Section 6.18

    Miscellaneous      24   
 

Section 6.19

    Conflicts; Intercreditor Agreement      24   
 

Section 6.20

    Post-Closing Collateral      24   
 

Section 6.21

    Non-US Grantors      24   

Schedule I – Subsidiary Parties

Schedule II – Pledged Equity and Pledged Debt

Schedule III – Commercial Tort Claims

Exhibits

 

Exhibit I

    Form of Security Agreement Supplement

Exhibit II

    Form of Perfection Certificate

Exhibit III

    Form of Patent Security Agreement

Exhibit IV

    Form of Trademark Security Agreement

Exhibit V

    Form of Copyright Security Agreement

 

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U.S. SECOND LIEN NOTES SECURITY AGREEMENT dated as of September 29, 2010, by and among the Grantors (as defined below) and Wilmington Trust FSB, as Collateral Agent for the Secured Parties (in such capacity, the “Collateral Agent”).

Reference is made to that certain Indenture, dated as of September 29, 2010 (as amended, supplemented or otherwise modified from time to time, the “Indenture”), by and among PINAFORE, LLC, a Delaware limited liability company, PINAFORE, INC., a Delaware corporation (collectively, the “Issuers”), PINAFORE HOLDINGS B.V. (“Holdings”), the other Note Guarantors from time to time party thereto and Wilmington Trust FSB, a federal savings bank, as trustee (in such capacity, the “Trustee”) and as Collateral Agent, pursuant to which the Issuers have issued $1,150,000,000 aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018 (together with the Exchange Securities and any Additional Securities issued under the Indenture, the “Securities”).

Pursuant to the terms of the Indenture, Holdings and certain of its Subsidiaries who are parties hereto have guaranteed the payment and performance of the Secured Obligations.

Now, therefore, in consideration of the premises, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and with the intent to be legally bound hereby, the parties hereto hereby agree as follows:

ARTICLE I

Definitions

Section 1.01 Indenture.

(a) Capitalized terms used in this Agreement and not otherwise defined herein have the respective meanings assigned thereto in the Indenture. All terms defined in the UCC (as defined herein) and not defined in this Agreement have the respective meanings specified in the UCC; the term “instrument” has the meaning specified in Article 9 of the UCC.

(b) The rules of construction specified in Section 1.04 of the Indenture also apply to this Agreement.

Section 1.02 Other Defined Terms. As used in this Agreement, the following terms have the respective meanings specified below:

“Account Debtor” means any Person who is or who may become obligated to any Grantor under, with respect to or on account of an Account.

“Accounts” has the meaning specified in Article 9 of the UCC.

“Agreement” means this U.S. Second Lien Notes Security Agreement.

“Article 9 Collateral” has the meaning assigned to such term in Section 3.01 (a).

“Collateral” means the Article 9 Collateral and the Pledged Collateral.

“Collateral Agent” has the meaning assigned to such term in the recitals of the Agreement.

“Collateral Documents” has the meaning assigned to such term in the Indenture.

“Commercial Tort Claims” has the meaning specified in Article 9 of the UCC.

“Copyright License” means any written agreement, now or hereafter in effect, granting any right to any third party under any Copyright now owned or hereafter acquired by any Grantor or that such Grantor otherwise has the right to license, or granting any right to any Grantor under any Copyright now owned or hereafter acquired by any third party, and all rights of such Grantor under any such agreement.

“Copyrights” means all of the following now owned or hereafter acquired by any Person: (a) all copyright rights in any work subject to the copyright laws of the United States, whether as author, assignee, transferee or otherwise, and (b) all registrations and applications for registration of any such copyright in the United States, including registrations and pending applications for registration in the USCO.

“Domestic Grantor” means any Grantor that is organized under the laws of the United States, any state thereof or the District of Columbia.

“Domestic Subsidiary” means any Subsidiary that is organized under the laws of the United States, any state thereof or the District of Columbia.

“Excluded Assets” means:

(a) any rights of a Grantor with respect to any contract, lease, license or other agreement if (but only to the extent that) the grant of a security interest therein would (x) constitute a violation (including a breach or default) of, a restriction in respect of, or result in the abandonment, invalidation or unenforceability of, such rights in favor of a third party or in conflict with any law, regulation, permit, order or decree of any Governmental Authority, unless and until all required consents shall have been obtained or (y) expressly give any other party (other than another Grantor or its Affiliates) in respect of any such contract, lease, license or other agreement, the right to terminate its obligations thereunder; provided, however, that the limitation set forth in this clause (a) shall not affect, limit, restrict or impair the grant by a Grantor of a security interest pursuant to this Agreement in any such Collateral to the extent that an otherwise applicable prohibition or restriction on such grant is rendered ineffective by any applicable Law, including the UCC; provided, further, that, at such time as the condition causing the conditions in subclauses (x) and (y) of this clause (a) shall be remedied, whether by contract, change of law or otherwise, the contract, lease, instrument, license or other documents shall immediately cease to be an Excluded Asset, and any security interest that would otherwise be granted herein shall attach immediately to such contract, lease, instrument, license or other agreement, or to the extent severable, to any portion thereof that does not result in any of the conditions in subclauses (x) or (y) above;

(b) any assets to the extent and for so long as the pledge of or security interest in such assets is prohibited by law and such prohibition is not overridden by the UCC or other applicable law;

(c) Excluded Security;

 

-2-

(d) any Trademark applications filed in the USPTO on the basis of such Grantor’s “intent-to-use” such Trademark, unless and until acceptable evidence of use of such Trademark has been filed with and accepted by the USPTO pursuant to Section l(c) or Section l(d) of the Lanham Act (15 U.S.C. 1051, et seq.), to the extent that granting a lien in such Trademark application prior to such filing would adversely affect the enforceability, validity, or other rights in such Trademark application;

(e) assets owned by any Grantor on the date hereof or hereafter acquired that are subject to a Lien of the type described in clauses (6), (8) and (24) (to the extent relating to Liens origi nally incurred pursuant to clauses (6) or (8)) of the definition of “Permitted Liens” in the Indenture that is permitted to be incurred pursuant to the provisions of the Indenture, if and to the extent that the contract or other agreement pursuant to which such Lien is granted or to which such assets are subject (or the documentation relating thereto) prohibits the creation of any other Lien on such asset;

(f) any particular assets if, in the reasonable judgment of the Issuers evidenced in writing and with the consent of the Credit Agreement Collateral Agent or any other Senior Representative, if applicable, to the extent such consent is not inconsistent with the consent provided under the Senior Collateral Documents (as defined in the Second Lien Intercreditor Agreement) such consent not to be unreasonably withheld or delayed), creating a pledge thereof or security interest therein to the Collateral Agent for the benefit of the Secured Parties would result in any material adverse tax consequences to Holdings or its Restricted Subsidiaries; and

(g) any particular assets if, in the reasonable judgment of the Credit Agreement Collateral Agent or any other Senior Representative, if applicable, to the extent such judgment is not inconsistent with the judgment provided under the Senior Collateral Documents (as defined in the Second Lien Intercreditor Agreement) determined in consultation with the Issuers and evidenced in writing, the burden, cost or consequences (including any adverse tax consequences) to Holdings or its Restricted Subsidiaries of creating or perfecting such pledges or security interests in such assets in favor of the Collateral Agent for the benefit of the Secured Parties is excessive in relation to the benefits to be obtained therefrom by the Secured Parties.

“Excluded Security” means

(a) more than 65% of the issued and outstanding Equity Interests entitled to vote of any Foreign Subsidiary of an Issuer or a Domestic Grantor,

(b) more than 65% of the issued and outstanding Equity Interests entitled to vote of any Domestic Subsidiary of a Domestic Grantor that is a disregarded entity under the Code if substantially all of its assets consist of the Equity Interests of one or more Subsidiaries that are controlled foreign corporations within the meaning of Section 957 of the Code; and

(c) any interest in a joint venture to the extent the granting of a security interest therein is prohibited by the terms of the organizational documents of such joint venture.

“General Intangibles” has the meaning specified in Article 9 of the UCC.

“Governmental Authority” means the government of the United States or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supranational bodies such as the European Union or the European Central Bank).

 

-3-

“Grantor” means the Issuers, each Note Guarantor (including Holdings) that is a party hereto, and each Subsidiary of Holdings that becomes a party to this Agreement after the Issue Date.

“Indenture” has the meaning assigned to such term in the preliminary statement of this Agreement.

“Indenture Documents” means the Indenture, the Securities, the Collateral Documents and any other document or instrument executed pursuant thereto.

“Intellectual Property” means all intellectual property now owned or hereafter acquired by any Person, including inventions, designs, Patents, Copyrights, Trademarks, trade secrets, the intellectual property rights in software and databases and related documentation, and all additions and improvements to the foregoing.

“Intellectual Property Security Agreements” means the short-form Patent Security Agreement, short-form Trademark Security Agreement, and short-form Copyright Security Agreement, each substantially in the form attached hereto as Exhibits III, IV and V, respectively.

“Investment Property” shall mean a security, whether certificated or uncertificated, Security Entitlement, Securities Account, Commodity Contract or Commodity Account, excluding, however, the Pledged Collateral.

“Issuers” has the meaning assigned to such term in the recitals of this Agreement.

“License” means any Patent License, Trademark License, Copyright License or other Intellectual Property license or sublicense agreement to which any Grantor is a party, together with any and all (i) renewals, extensions, supplements and continuations thereof, (ii) income, fees, royalties, damages, claims and payments now and hereafter due and/or payable thereunder or with respect thereto including damages and payments for past, present or future infringements or violations thereof, and (iii) rights to sue for past, present and future violations thereof.

“Margin Stock” has the meaning specified in Regulation U of the Board of Governors of the Federal Reserve System.

“Mortgaged Properties” has the meaning assigned to such term in the Indenture.

“Patent License” means any written agreement, now or hereafter in effect, granting to any third party any right to make, use or sell any invention on which a Patent, now owned or hereafter acquired by any Grantor or that any Grantor otherwise has the right to license, is in existence, or granting to any Grantor any right to make, use or sell any invention on which a Patent, now owned or hereafter acquired by any third party, is in existence, and all rights of any Grantor under any such agreement.

“Patents” means all of the following now owned or hereafter acquired by any Person: (a) all letters Patent of the United States in or to which any Grantor now or hereafter has any right, title or interest therein, all registrations thereof, and all applications for letters Patent of the United States, including registrations and pending applications in the USPTO, and (b) all reissues, continuations, divisions, continuations-in-part, renewals or extensions thereof, and the inventions disclosed or claimed therein, including the right to make, use and/or sell the inventions disclosed or claimed therein.

“Perfection Certificate” means a certificate substantially in the form of Exhibit II, completed and supplemented with the schedules and attachments contemplated thereby, and duly executed on the Issue Date by a Responsible Officer of the Issuers and as the same shall be supplemented from time to time.

 

-4-

“Pledged Collateral” has the meaning assigned to such term in Section 2.01.

“Pledged Debt” has the meaning assigned to such term in Section 2.01.

“Pledged Equity” has the meaning assigned to such term in Section 2.01.

“Pledged Securities” means the Pledged Equity and Pledged Debt.

“Post Closing Collateral Date” has the meaning assigned to such term in the Indenture.

“Secured Obligations” means (a) the due and punctual payment by the Issuers of (i) the principal of and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Securities, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise and (ii) all other monetary obligations of the Issuers to any of the Secured Parties under the Indenture and each of the other Indenture Documents, including obligations to pay fees, expense reimbursement obligations and indemnification obligations, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) owing to the Secured Parties, (b) the due and punctual performance of all other obligations of the Issuers under or pursuant to the Indenture and each of the other Indenture Documents, and (c) the due and punctual payment and performance of all the obligations of each Guarantor under or pursuant to this Agreement and each of the other Indenture Documents.

“Secured Parties” means, collectively, the Collateral Agent, the Trustee, each Holder and each co-Collateral Agent appointed by the Collateral Agent from time to time pursuant to Section 10.02 of the Indenture.

“Security Agreement Supplement” means an instrument substantially in the form of Exhibit I hereto.

“Security Interest” has the meaning assigned to such term in Section 3.01.

“Senior Representative” has the meaning assigned to such term in the Second Lien Intercreditor Agreement.

“Subsidiary Parties” means (a) the Restricted Subsidiaries identified on Schedule I and (b) each other Restricted Subsidiary that becomes a party to this Agreement as a Subsidiary Parry after the Issue Date.

“Trademark License” means any written agreement, now or hereafter in effect, granting to any third party any right to use any trademark now or hereafter owned by any Grantor or that any Grantor otherwise has the right to license, or granting to any Grantor any right to use any trademark now or hereafter owned by any third party, and all rights of any Grantor under any such agreement.

“Trademarks” means all of the following now owned or hereafter acquired by any Person: (a) all trademarks, service marks, trade names, corporate names, trade dress, logos, designs, fictitious business names other source or business identifiers, now owned or hereafter acquired, all registrations and

 

-5-

recordings thereof, and all registration and recording applications filed in connection therewith, including registrations and registration applications in the USPTO or any similar offices in any State of the United States or any jurisdiction thereof, and all extensions or renewals thereof, and (b) all goodwill associated therewith.

“UCC” means the Uniform Commercial Code as from time to time in effect in the State of New York; provided that, if perfection or the effect of perfection or non-perfection or the priority of the security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, “UCC” means the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or non-perfection or priority.

“USCO” means the United States Copyright Office.

“USPTO” means the United States Patent and Trademark Office.

ARTICLE II

Pledge of Securities

Section 2.01 Pledge. As security for the payment or performance, as the case may be, in full of the Secured Obligations, including the Guarantees, each of the Grantors hereby collaterally assigns and pledges to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, and hereby grants to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, a security interest in all of such Grantors’ right, title and interest in, to and under (in each case, as applicable):

(i) all Equity Interests held by it that are listed on Schedule II and any other Equity Interests obtained in the future by such Grantor and the certificates representing all such Equity Interests of any Subsidiary (collectively, the “Pledged Equity”); provided that the Pledged Equity shall not include Excluded Assets;

(ii) (A) the debt securities owned by it and listed opposite the name of such Grantor on Schedule II, (B) any debt securities obtained in the future by such Grantor and (C) the promissory notes and any other instruments evidencing such debt securities (collectively, the “Pledged Debt”); provided that the Pledged Debt shall not include any Excluded Assets;

(iii) all other property that may be delivered to and held by the Collateral Agent pursuant to the terms of this Section 2.01;

(iv) subject to Section 2.06, all payments of principal or interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of, in exchange for or upon the conversion of, and all other Proceeds received in respect of, the Pledged Equity and Pledged Debt referred to in clauses (i) and (ii) above;

(v) subject to Section 2.06, all rights and privileges of such Grantor with respect to the securities and other property referred to in clauses (i), (ii), (iii) and (iv) above; and

(vi) all Proceeds of any of the foregoing (the items referred to in clauses (i) through (v) above being collectively referred to as the “Pledged Collateral”);

 

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provided that, notwithstanding anything to the contrary in this Agreement, (i) this Agreement shall not constitute a grant of security interest in (A) any Excluded Asset or (B) any Capital Stock of any Subsidiary of Holdings to the extent necessary for such Subsidiary not to be subject to any requirement pursuant to Rule 3-16 of Regulation S-X under the Securities Act of 1933, as amended (the “Securities Act”) and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), to file separate financial statements with the Securities and Exchange Commission (the “SEC”) (or any other governmental agency), due to the fact that such Subsidiary’s Captial Stock secures the Securities or the guarantees of the Securities (only to the extent necessary to not be subject to such requirement and only for so long as required to not be subject to such requirement) and (ii) no Grantor shall be required to take steps to perfect the security interest in the Collateral granted hereunder (A) by indicating such security interest on the certificate of title for any motor vehicle or other asset that is covered by a certificate of title, (B) by entering into any control agreements or control arrangements (including with respect to Deposit Accounts, Securities Accounts, Commodity Accounts or Letter-of-Credit Rights), or (C) by making any fixture filings with respect to fixtures or as-extracted collateral.

Notwithstanding the foregoing, in the event that Rule 3-16 of Regulation S-X under the Securities Act and the Exchange Act is amended, modified or interpreted by the SEC to permit (or is replaced with another rule or regulation, or any other law, rule or regulation is adopted, which would permit) such Grantor’s Capital Stock and other securities to secure the Securities in excess of the amount then pledged without the filing with the SEC (or any other governmental agency) of separate financial statements of such Grantor, then the Capital Stock and other securities of such Grantor will automatically be deemed to be a part of the Pledged Collateral for the Securities but only to the extent necessary to not be subject to any such financial statement requirement.

TO HAVE AND TO HOLD the Pledged Collateral, together with all right, title, interest, powers, privileges and preferences pertaining or incidental thereto, unto the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, forever, subject, however, to the terms, covenants and conditions hereinafter set forth.

Section 2.02 Delivery of the Pledged Securities.

(a) Subject to the terms of the Second Lien Intercreditor Agreement, each Grantor agrees promptly (but in any event within 60 days after receipt by such Grantor, or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion) to deliver or cause to be delivered to the Collateral Agent, for the benefit of the Secured Parties, any and all (i) Pledged Equity to the extent certificated and (ii) to the extent required to be delivered pursuant to paragraph (b) of this Section 2.02, Pledged Debt.

(b) Subject to the terms of the Second Lien Intercreditor Agreement, each Grantor will cause any Indebtedness for borrowed money (other than any Excluded Asset) having an aggregate principal amount in excess of $1,000,000 individually owed to such Grantor by any Person that is evidenced by a duly executed promissory note to be pledged and delivered to the Collateral Agent, for the benefit of the Secured Parties, pursuant to the terms hereof (subject, for the avoidance of doubt, to the 60 day delivery period set forth in clause (a) above or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion).

(c) Upon delivery to the Collateral Agent, any Pledged Securities shall be accompanied by stock or security powers duly executed in blank or other instruments of transfer reasonably satisfactory to the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent.

 

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(d) Prior to the Discharge of Senior Obligations, (i) the requirements of this Section 2.02 to deliver to the Collateral Agent any Collateral, the security of which may be perfected only by possession or control by a single person shall be deemed satisfied by the delivery of possession or control of such Collateral to the Credit Agreement Collateral Agent or any other Senior Representative (as provided in the Second Lien Intercreditor Agreement) and (ii) each Grantor shall comply with the requirements of this Section 2.02 with respect to the obligations hereunder only to the same extent such Grantor is required to comply with provisions analogous to this Section 2.02 with respect to the Senior Obligations in the Senior Collateral Documents.

Section 2.03 Representations, Warranties and Covenants. Each Grantor represents, warrants and covenants to and with the Collateral Agent, for the benefit of the Secured Parties, that:

(a) As of the date hereof, Schedule II includes all Pledged Equity and Pledged Debt required to be pledged by such Grantor on the date hereof under the Credit Agreement;

(b) To the extent issued by a Grantor or any of its Subsidiaries, all such Pledged Equity and such Pledged Debt has been duly and validly authorized and issued by the issuer(s) thereof and are (i) in the case of such Pledged Equity, fully paid and nonassessable (other than with respect to Pledged Equity consisting of membership interests limited liability companies to the extent provided in Section 18-502 and 18-607 of the Delaware Limited Liability Company Act) and (ii) in the case of such Pledged Debt, the valid and legally binding obligations of the issuer(s) thereof, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding at law or in equity) and an implied covenant of good faith and fair dealing;

(c) except for the security interests granted hereunder, such Grantor (i) is and, subject to any transfers made in compliance with or permitted by the Indenture, will continue to be, the direct owner, beneficially and of record, of the Pledged Equity indicated opposite such Grantor’s name on Schedule II, (ii) holds the same free and clear of all Liens, other than Liens created by the Collateral Documents or Permitted Liens and (iii) will make no assignment, pledge, hypothecation or transfer of, or create or permit to exist any security interest in or other Lien on, the Pledged Collateral, other than assignments, pledges, hypothecations and transfers permitted by the Indenture or Permitted Liens; and

(d) the execution and performance by the Grantors of this Agreement are within each Grantor’s corporate, limited liability or limited partnership power, as applicable, and have been duly authorized by all necessary corporate, limited liability or limited partnership action or other organizational action, as applicable.

Subject to the terms of this Agreement and to the extent permitted by Applicable Law, each Grantor hereby agrees that upon the occurrence and during the continuance of an Event of Default, it will comply with instructions of the Collateral Agent with respect to the Equity Interests in such Grantor that constitute Pledged Equity hereunder that are not certificated without further consent by the applicable owner or holder of such Equity Interests.

Notwithstanding anything to the contrary in this Agreement, to the extent any provision of this Agreement or the Indenture excludes any assets from the scope of the Pledged Collateral, or from any requirement to take any action to perfect any security interest in favor of the Collateral Agent in the Pledged Collateral, the representations, warranties and covenants made by any relevant Grantor in this

 

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Agreement with respect to the creation, perfection or priority (as applicable) of the security interest granted in favor of the Collateral Agent (including, without limitation, this Section 2,03) shall be deemed not to apply to such excluded assets.

Section 2.04 Certification of Limited Liability Company and Limited Partnership Interests. No interest in any limited liability company or limited partnership controlled by any Grantor that constitutes Pledged Equity shall be represented by a certificate unless (i) the limited liability company agreement or partnership agreement expressly provides that such interests shall be a “security” within the meaning of Article 8 of the UCC of the applicable jurisdiction and (ii) subject to the terms of the Second Lien Intercreditor Agreement, such certificate shall be delivered to the Collateral Agent in accordance with Section 2.02. Subject to the terms of the Second Lien Intercreditor Agreement, to the extent an interest in any Limited liability company or limited partnership controlled by any Grantor and pledged under Section 2.01 is certificated or becomes certificated, (i) each such certificate shall be delivered to the Collateral Agent, pursuant to Section 2.02(a) and (ii) such Grantor shall fulfill all other requirements under Section 2.02 applicable in respect thereof.

Section 2.05 Registration in Nominee Name; Denominations. If an Event of Default shall have occurred and be continuing, subject to the Second Lien Intercreditor Agreement, (a) the Collateral Agent, on behalf of the Secured Parties, shall have the right to hold the Pledged Securities in its own name as pledgee, the name of its nominee (as pledgee or as sub-agent) or the name of the applicable Grantor, endorsed or assigned in blank or in favor of the Collateral Agent and, upon the Collateral Agent’s written request, each Grantor will promptly give to the Collateral Agent copies of any notices or other communications received by it with respect to Pledged Equity registered in the name of such Grantor and (b) the Collateral Agent shall have the right to exchange the certificates representing Pledged Equity for certificates of smaller or larger denominations for any purpose consistent with this Agreement, to the extent permitted by the documentation governing such Pledged Securities.

Section 2.06 Voting Rights; Dividends and Interest.

(a) Unless and until an Event of Default shall have occurred and be continuing and until the Collateral Agent shall have given the Grantors notice of its exercise of remedies:

(i) Each Grantor shall be entitled to exercise any and all voting and/or other consensual rights and powers inuring to an owner of Pledged Securities or any part thereof, and each Grantor agrees that it shall exercise such rights for purposes not in violation of the terms of this Agreement, the Indenture and the other Indenture Documents;

(ii) The Collateral Agent shall promptly (after reasonable advance notice) execute and deliver to each Grantor, or cause to be executed and delivered to such Grantor, all such proxies, powers of attorney and other instruments as such Grantor may reasonably request for the purpose of enabling such Grantor to exercise the voting and/or consensual rights and powers it is entitled to exercise pursuant to subparagraph (i) above; and

(iii) Each Grantor shall be entitled to receive and retain any and all dividends, interest, principal and other distributions paid on or distributed in respect of the Pledged Securities to the extent and only to the extent that such dividends, interest, principal and other distributions are permitted by, and otherwise paid or distributed in accordance with, the terms and conditions of the Indenture, Indenture Documents and applicable Law; provided that any noncash dividends, interest, principal or other distributions that would constitute Pledged Equity or Pledged Debt, whether resulting from a subdivision, combination or reclassification of the outstanding Equity Interests of the issuer of any Pledged Securities or received in exchange for Pledged Securities or

 

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any part thereof, or in redemption thereof, or as a result of any merger, consolidation, acquisition or other exchange of assets to which such issuer may be a party or otherwise, shall be and become part of the Pledged Collateral, and, if received by any Grantor, shall not be commingled by such Grantor with any of its other funds or property but shall be held separate and apart therefrom, shall be held in trust for the benefit of the Collateral Agent and the Secured Parties and shall be promptly (and in any event within 10 days or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion) delivered to the Collateral Agent in the same form as so received (with any necessary endorsement reasonably requested by the Collateral Agent). So long as no Default or Event of Default has occurred and is continuing, the Collateral Agent shall promptly deliver to each Grantor any Pledged Securities in its possession if requested to be delivered to the issuer thereof in connection with any exchange or redemption of such Pledged Securities permitted by the Indenture in accordance with this Section 2.06(a)(iii).

(b) Upon the occurrence and during the continuance of an Event of Default and upon receipt of notice from Collateral Agent of its exercise of remedies, subject to the Second Lien Intercreditor Agreement, all rights of any Grantor to dividends, interest, principal or other distributions that such Grantor is authorized to receive pursuant to paragraph (a)(iii) of this Section 2.06 shall cease, and all such rights shall thereupon become vested in the Collateral Agent, which shall have the sole and exclusive right and authority to receive and retain such dividends, interest, principal or other distributions. All dividends, interest, principal or other distributions received by any Grantor contrary to the provisions of this Section 2.06 shall be held in trust for the benefit of the Collateral Agent, shall be segregated from other property or funds of such Grantor and subject to the Second Lien Intercreditor Agreement, shall be promptly (and in any event within 10 days or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion) delivered to the Collateral Agent upon demand in the same form as so received (with any necessary endorsement reasonably requested by the Collateral Agent). Any and all money and other property paid over to or received by the Collateral Agent pursuant to the provisions of this paragraph (b) shall be retained by the Collateral Agent in an account to be established by the Collateral Agent upon receipt of such money or other property and shall be applied in accordance with the provisions of Section 4.02. After all Events of Default have been cured or waived, the Collateral Agent shall promptly repay to each Grantor (without interest) all dividends, interest, principal or other distributions that such Grantor would otherwise be permitted to retain pursuant to the terms of paragraph (a)(iii) of this Section 2.06 and that remain in such account.

(c) Upon the occurrence and during the continuance of an Event of Default and upon receipt of notice from Collateral Agent of its exercise of remedies, all rights of any Grantor to exercise the voting and consensual rights and powers it is entitled to exercise pursuant to paragraph (a)(i) of this Section 2.06, and the obligations of the Collateral Agent under paragraph (a)(ii) of this Section 2.06, shall cease, and subject to the Second Lien Intercreditor Agreement, all such rights shall thereupon become vested in the Collateral Agent, which shall have the sole and exclusive right and authority to exercise such voting and consensual rights and powers; provided that, unless otherwise directed by the Secured Parties, the Collateral Agent shall have the right from time to time following and during the continuance of an Event of Default to permit the Grantors to exercise such rights. After all Events of Default have been cured or waived, each Grantor shall have the exclusive right to exercise the voting and/or consensual rights and powers that such Grantor would otherwise be entitled to exercise pursuant to the terms of paragraph (a)(i) above, and the obligations of the Collateral Agent under paragraph (a)(ii) of this Section 2.06 shall be reinstated.

 

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Section 2.07 Intercreditor Agreement. Notwithstanding anything in this Agreement to the contrary, the lien and security interest granted to the Collateral Agent pursuant to any Indenture Document (including, without limitation, this Agreement) and the exercise of any right or remedy in respect of the Collateral by the Collateral Agent under this Agreement or under any other Indenture Document are subject to the provisions of the Second Lien Intercreditor Agreement. In the event of any conflict between the terms of the Second Lien Intercreditor Agreement, this Agreement and any other Indenture Document, the terms of the Second Lien Intercreditor Agreement shall govern and control with respect to any right or remedy. Without limiting the generality of the foregoing, and notwithstanding anything in this Agreement to the contrary, all rights and remedies with respect to the Collateral of the Collateral Agent shall be subject to the terms of the Second Lien Intercreditor Agreement, and until the Discharge of Senior Obligations, (a) no Grantor shall be required hereunder or under any other Indenture Document to take any action that is inconsistent with such Grantor’s obligations under the Senior Documents and (b) any obligation of any Grantor under any Indenture Document with respect to the delivery or control of any Collateral or the giving of any notice to any bailee or other Person shall be deemed to be satisfied if the Grantor complies with the requirements of the similar provision of the applicable Senior Document. Until the Discharge of Senior Obligations, the Collateral Agent may not require any Grantor to take any action with respect to the creation, perfection or priority of its security interest, whether pursuant to the express terms hereof or of any other Indenture Document or pursuant to the further assurances provisions hereof or any other Indenture Document, to the extent the Credit Agreement Collateral Agent or the applicable Senior Representative shall not have taken or required such Grantor to take similar action, and delivery of any Collateral to the Credit Agreement Collateral Agent or Senior Representative pursuant to the Senior Documents shall satisfy any delivery requirement hereunder or under any other Indenture Document.

ARTICLE III

Security Interests in Personal Property

Section 3.01 Security Interest.

(a) As security for the payment or performance, as the case may be, in full of the Secured Obligations, including the Guarantees, each Grantor hereby collaterally assigns and pledges to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, and hereby grants to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, a security interest (the “Security Interest”) in, all right, title or interest in or to any and all of the following assets and properties now owned or at any time hereafter acquired by such Grantor or in which such Grantor now has or at any time in the future may acquire any right, title or interest (collectively, the “Article 9 Collateral”):

 

  (i) all Accounts;

 

  (ii) all Chattel Paper;

 

  (iii) all Documents;

 

  (iv) all Equipment;

 

  (v) all General Intangibles;

 

  (vi) all Goods;

 

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(vii) all Instruments;

(viii) all Inventory;

(ix) all Investment Property;

(x) all books and records pertaining to the Article 9 Collateral;

(xi) all Fixtures;

(xii) all Letter of Credit and Letter-of-Credit Rights;

(xiii) all Intellectual Property;

(xiv) all Commercial Tort Claims listed on Schedule III and on any supplement thereto received by the Collateral Agent pursuant to Section 3.03(i); and

(xv) to the extent not otherwise included, all Proceeds and products of any and all of the foregoing and all Supporting Obligations, collateral security and guarantees given by any Person with respect to any of the foregoing;

provided that, notwithstanding anything to the contrary in this Agreement, (i) this Agreement shall not constitute a grant of security interest in (A) any Excluded Asset or (B) any Capital Stock of any Subsidiary of Holdings to the extent necessary for such Subsidiary not to be subject to any requirement pursuant to Rule 3-16 of Regulation S-X under the Securities Act and Exchange Act, to file separate financial statements with the SEC (or any other governmental agency), due to the fact that such Subsidiary’s Captial Stock secures the Securities or the guarantees of the Securities (only to the extent necessary to not be subject to such requirement and only for so long as required to not be subject to such requirement) and (ii) no Grantor shall be required to take steps to perfect the security interest in the Collateral granted here-under (A) by indicating such security interest on the certificate of title for any motor vehicle or other asset that is covered by a certificate of title, (B) by entering into any control agreements or control arrangements (including with respect to Deposit Accounts, Securities Accounts, Commodity Accounts or Letter-of-Credit Rights), or (C) by making any fixture filings with respect to fixtures or as-extracted collateral.

Notwithstanding the foregoing, in the event that Rule 3-16 of Regulation S-X under the Securities Act and Exchange Act is amended, modified or interpreted by the SEC to permit (or is replaced with another rule or regulation, or any other law, rule or regulation is adopted, which would permit) such Grantor’s Capital Stock and other securities to secure the Securities in excess of the amount then pledged without the filing with the SEC (or any other governmental agency) of separate financial statements of such Grantor, then the Capital Stock and other securities of such Grantor will automatically be deemed to be a part of the Pledged Collateral for the Securities but only to the extent necessary to not be subject to any such financial statement requirement.

(b) Each Grantor hereby irrevocably authorizes the Collateral Agent for the benefit of the Secured Parties at any time and from time to time to file in any relevant jurisdiction any initial financing statements with respect to the Article 9 Collateral or any part thereof and amendments thereto that (i) indicate the Article 9 Collateral as “all assets” or “all personal property” of such Grantor or words of similar effect as being of an equal or lesser scope or with greater detail and (ii) contain the information required by Article 9 of the UCC or the analogous legislation of each applicable jurisdiction for the filing of any financing statement or amendment, including whether such Grantor is an organization, the type of organization and, if required, any organizational identification number issued to such Grantor. Each

 

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Grantor agrees to provide such information to the Collateral Agent promptly upon any reasonable request. Nothing contained in this Agreement shall alter or modify the requirements contained in Section 10.01 of the Indenture, which provisions are expressly incorporated herein by reference.

(c) The Security Interest is granted as security only and shall not subject the Collateral Agent or any other Secured Party to, or in any way alter or modify, any obligation or liability of any Grantor with respect to or arising out of the Article 9 Collateral.

(d) The Collateral Agent is authorized to file with the USPTO or the USCO (or any successor office) such documents as may be necessary or advisable for the purpose of perfecting, confirming, continuing, enforcing or protecting the Security Interest in United States registered and applied for Intellectual Property of each Grantor in which a security interest has been granted by each Grantor, without the signature of any Grantor, and naming any Grantor or the Grantor as debtors and the Collateral Agent as secured party.

Section 3.02 Representations and Warranties. Each Grantor jointly and severally represents and warrants, as to itself and the other Grantors, to the Collateral Agent and the Secured Parties that:

(a) Subject to Permitted Liens, each Grantor has full power and authority to grant to the Collateral Agent the Security Interest in such Collateral pursuant hereto and to execute, deliver and perform its obligations in accordance with the terms of this Agreement, without the consent or approval of any other Person other than any consent or approval that has been obtained prior to the date hereof.

(b) The UCC financing statements or other appropriate filings, recordings or registrations were prepared based upon the information provided in the Perfection Certificate and will be filed by the Issuer, its agents or its designees in the applicable filing office and are all the filings, recordings and registrations that are necessary to establish a legal, valid and perfected security interest in favor of the Collateral Agent (for the benefit of the Secured Parties) in respect of all Article 9 Collateral in which the Security Interest may be perfected by filing, recording or registration in the United States (or any political subdivision thereof) and its territories and possessions pursuant to the Uniform Commercial Code, and no further or subsequent filing, re-filing, recording, rerecording, registration or re-registration is necessary in any such jurisdiction, except as provided under applicable Law with respect to the filing of continuation statements.

(c) Each Grantor represents and warrants that short-form Intellectual Property Security Agreements substantially in the form attached hereto as Exhibits III, IV and V and containing a description of all Article 9 Collateral consisting of United States registered and applied for Patents, United States registered Trademarks (and Trademarks for which United States registration applications are pending, unless it constitutes an Excluded Asset) and United States registered Copyrights, respectively, have been delivered to the Collateral Agent for recording by the USPTO and the USCO pursuant to 35 U.S.C. § 261,15 U.S.C. § 1060 or 17 U.S.C. § 205 and the regulations thereunder, as applicable, (for the benefit of the Secured Parties) in respect of all Article 9 Collateral consisting of registrations and applications for United States Patents, Trademarks and Copyrights. To the extent a security interest may be perfected by filing, recording or registration in USPTO or USCO under the Federal intellectual property laws, then no further or subsequent filing, re-filing, recording, rerecording, registration or re-registration is necessary (other than (i) such filings and actions as are necessary to perfect the Security Interest with respect to any Article 9 Collateral consisting of United States registered and applied for Patents, Trademarks and Copyrights acquired or developed by any Grantor after the date hereof and (ii) the UCC financing and continuation statements contemplated in Section 3.02(b)).

 

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(d) The Security Interest constitutes (i) a legal and valid security interest in all the Article 9 Collateral securing the payment and performance of the Secured Obligations and (ii) subject to the filings described in Section 3.02(b), a perfected security interest in all Article 9 Collateral in which a security interest may be perfected by filing, recording or registering a financing statement or analogous document in the United States (or any political subdivision thereof) and its territories and possessions pursuant to the Uniform Commercial Code in the relevant jurisdiction. The Security Interest is and shall be prior to any other Lien on any of the Article 9 Collateral, other than (i) any statutory or similar Lien that has priority as a matter of Law and (ii) any Permitted Liens.

(e) The Article 9 Collateral is owned by the Grantors free and clear of any Lien, except for Permitted Liens. None of the Grantors has filed or consented to the filing of (i) any financing statement or analogous document under the Uniform Commercial Code or any other applicable Laws covering any Article 9 Collateral, (ii) any assignment in which any Grantor assigns any Article 9 Collateral or any security agreement or similar instrument covering any Article 9 Collateral with the USPTO or the USCO, or (iii) any assignment in which any Grantor assigns any Article 9 Collateral or any security agreement or similar instrument covering any Article 9 Collateral with any foreign governmental, municipal or other office, which financing statement or analogous document, assignment, security agreement or similar instrument is still in effect, except, in each case, for Permitted Liens and assignments permitted by the Indenture.

(f) As of the date hereof, no Grantor has any Commercial Tort Claim in excess of $5,000,000 individually or $10,000,000 in the aggregate, other than the Commercial Tort Claims listed on Schedule III.

Section 3.03 Covenants.

(a) The Issuers agree to notify the Collateral Agent in writing within 60 days (or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion) after effecting any change in (i) the legal name of any Grantor, (ii) the identity or type of organization or corporate structure of any Grantor, (iii) the jurisdiction of organization of any Grantor or (iv) chief executive office of any Grantor and take all actions that are necessary or requested by the Collateral Agent to continue the perfection of security interests created herein in Collateral at all times following any such change.

(b) Each Grantor agrees, at its own expense, to execute, acknowledge, deliver and cause to be duly filed all such further instruments and documents and take all such actions as the Collateral Agent may from time to time reasonably request to better assure, preserve, protect and perfect the Security Interest and the rights and remedies created hereby, including the granting of the Security Interest and the filing of any financing statements or other documents in connection herewith or therewith. Subject to the Second Lien Intercreditor Agreement, if any amount payable under or in connection with any of the Article 9 Collateral that is in excess of $1,000,000 in the aggregate shall be or become evidenced by any promissory note, other instrument, debt security or chattel paper, such note, instrument, debt security or chattel paper shall be promptly (and in any event within 60 days of its acquisition or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion) pledged and delivered to the Collateral Agent, for the benefit of the Secured Parties, duly endorsed in a manner reasonably satisfactory to the Collateral Agent. If an Event of Default has occurred and is continuing, the Collateral Agent may institute and maintain, in its own name or in the name of any Grantor, such suits and proceedings as the Collateral Agent may be advised by counsel shall be necessary or expedient to prevent any impairment of the security interest in or the perfection thereof in the Collateral. All of the foregoing shall be at the sole cost and expense of the Grantors to the extent otherwise required by Section 7.07 of the Indenture.

 

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(c) Upon the occurrence and during the continuance of an Event of Default, at its option, the Collateral Agent may discharge past due taxes, assessments, charges, fees, Liens, security interests or other encumbrances at any time levied or placed on the Article 9 Collateral and not permitted pursuant to Section 4.11 of the Indenture, and may pay for the maintenance and preservation of the Article 9 Collateral to the extent any Grantor fails to do so as required by the Indenture within a reasonable period of time after the Collateral Agent has requested that it do so, and each Grantor jointly and severally agrees to reimburse the Collateral Agent after demand for any payment made or any reasonable expense incurred by the Collateral Agent pursuant to the foregoing authorization. Nothing in this paragraph shall be interpreted as excusing any Grantor from the performance of, or imposing any obligation on the Collateral Agent or any Secured Party to cure or perform, any covenants or other promises of any Grantor with respect to taxes, assessments, charges, fees, Liens, security interests or other encumbrances and maintenance as set forth herein or in the other Indenture Documents.

(d) Intellectual Property Covenants.

(i) Other than to the extent not prohibited herein or in the Indenture or with respect to registrations and applications no longer used or useful, except to the extent failure to act would not, as deemed by the applicable Grantor in its reasonable business judgment, reasonably be expected to have a material adverse effect, with respect to registration or pending application of each item of its Intellectual Property for which such Grantor has standing to do so, each Grantor agrees to take, at its expense, all reasonable steps, including, without limitation, in the USPTO, the USCO and any other governmental authority located in the United States, to pursue the registration and maintenance of each Patent, Trademark, or Copyright registration or application, now or hereafter included in the Intellectual Property of such Grantor that are not Excluded Assets.

(ii) Other than to the extent not prohibited herein or in the Indenture, or with respect to registrations and applications no longer used or useful, or except as would not, as deemed by the applicable Grantor in its reasonable business judgment, reasonably be expected to have a material adverse effect, no Grantor shall do or permit any act or knowingly omit to do any act whereby any of its Intellectual Property, excluding Excluded Assets, may lapse, be terminated, or become invalid or unenforceable or placed to the public domain (or in the case of a trade secret, become publicly known).

(iii) Other than as excluded or as not prohibited herein or in the Indenture, or with respect to Patents, Copyrights or Trademarks which are no longer used or useful in the applicable Grantor’s business operations or except where failure to do so would not, as deemed by the applicable Grantor in its reasonable business judgment, reasonably be expected to have a material adverse effect, each Grantor shall take all reasonable steps to preserve and enforce each item of its Intellectual Property.

(iv) Notwithstanding any other provision of this Agreement, nothing in this Agreement or any other Indenture Document prevents or shall be deemed to prevent any Grantor from disposing of, discontinuing the use or maintenance of, failing to pursue, or otherwise allowing to lapse, expire, terminate or be put into the public domain, any of its Intellectual Property to the extent permitted by the Indenture if such Grantor determines in its reasonable business judgment that such discontinuance is desirable in the conduct of its business.

 

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(v) Simultaneously with the delivery of the Officer’s Certificate required pursuant to Section 4.09 of Indenture (or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion), the Issuers shall provide a list of any additional registrations of or applications for Intellectual Property of all Grantors with the USPTO and USCO not previously disclosed to the Collateral Agent including such information as is necessary for such Grantor to make appropriate filings in the USPTO and USCO. The provisions hereof shall automatically apply to such Intellectual Property as if such would have constituted Article 9 Collateral at the time of execution hereof and be subject to the Security Interest without further action by any party. Each Grantor shall also at the time of delivery of such list provide to the Collateral Agent confirmation of the attachment of the Security Interest to such Intellectual Property by execution of an instrument in form reasonably acceptable to the Collateral Agent and the filing of any instruments or statements as shall be reasonably necessary to create, preserve, protect or perfect the Collateral Agent’s Security Interest in such Intellectual Property.

(e) If the Grantors shall at any time hold or acquire any Commercial Tort Claims in an amount reasonably estimated by such Grantor to exceed $5,000,000 individually or $10,000,000 in the aggregate for which this clause has not been satisfied and for which a complaint in a court of competent jurisdiction has been filed, such Grantor shall within 60 days after the end of the fiscal quarter in which such complaint was filed (or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion) notify the Collateral Agent thereof in a writing signed by such Grantor including a summary description of such claim and grant to the Collateral Agent, for the benefit of the Secured Parties, in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement.

(f) In the event that the proceeds of any insurance claim are paid to any Grantor after the Collateral Agent has exercised its right to foreclose after an Event of Default, such proceeds shall be held in trust for the benefit of the Collateral Agent and, subject to the Second Lien Intercreditor Agreement, immediately after receipt thereof shall be paid to the Collateral Agent for application in accordance with Section 4.02.

ARTICLE IV

Remedies

Section 4.01 Remedies Upon Default. Upon the occurrence and during the continuance of an Event of Default, it is agreed that the Collateral Agent shall have the right to exercise any and all rights afforded to a secured party with respect to the Secured Obligations, including the Guarantees, under the Uniform Commercial Code or other applicable Law and also may (i) require each Grantor to, and each Grantor agrees that it will at its expense and upon request of the Collateral Agent promptly, assemble all or part of the Collateral as directed by the Collateral Agent and make it available to the Collateral Agent at a place and time to be designated by the Collateral Agent that is reasonably convenient to both parties; (ii) occupy any premises owned or, to the extent lawful and permitted, leased by any of the Grantors where the Collateral or any part thereof is assembled or located for a reasonable period in order to effectuate its rights and remedies hereunder or under Law, without obligation to such Grantor in respect of such occupation; provided that the Collateral Agent shall provide the applicable Grantor with notice thereof prior to such occupancy; (iii) exercise any and all rights and remedies of any of the Grantors under or in connection with the Collateral, or otherwise in respect of the Collateral; provided that the Collateral Agent shall provide the applicable Grantor with notice thereof prior to such exercise; and (iv) subject to the mandatory requirements of applicable Law and the notice requirements

 

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subject to the mandatory requirements of applicable Law and the notice requirements described below, sell or otherwise dispose of all or any part of the Collateral securing the Secured Obligations at a public or private sale or at any broker’s board or on any securities exchange, for cash, upon credit or for future delivery as the Collateral Agent shall deem appropriate. The Collateral Agent shall be authorized at any such sale of securities (if it deems it advisable to do so) to restrict the prospective bidders or purchasers to Persons who will represent and agree that they are purchasing the Collateral for their own account for investment and not with a view to the distribution or sale thereof, and upon consummation of any such sale the Collateral Agent shall have the right to assign, transfer and deliver to the purchaser or purchasers thereof the Collateral so sold. Each such purchaser at any sale of Collateral shall hold the property sold absolutely, free from any claim or right on the part of any Grantor, and each Grantor hereby waives (to the extent permitted by Law) all rights of redemption, stay and appraisal which such Grantor now has or may at any time in the future have under any Law now existing or hereafter enacted.

The Collateral Agent shall give the applicable Grantors 10 days’ written notice (which each Grantor agrees is reasonable notice within the meaning of Section 9-611 of the UCC or its equivalent in other jurisdictions) of the Collateral Agent’s intention to make any sale of Collateral. Such notice, in the case of a public sale, shall state the time and place for such sale and, in the case of a sale at a broker’s board or on a securities exchange, shall state the board or exchange at which such sale is to be made and the day on which the Collateral, or portion thereof, will first be offered for sale at such board or exchange. Any such public sale shall be held at such time or times within ordinary business hours and at such place or places as the Collateral Agent may fix and state in the notice (if any) of such sale. At any such sale, the Collateral, or portion thereof, to be sold may be sold in one lot as an entirety or in separate parcels, as the Collateral Agent may (in its sole and absolute discretion) determine. The Collateral Agent shall not be obligated to make any sale of any Collateral if it shall determine not to do so, regardless of the fact that notice of sale of such Collateral shall have been given. The Collateral Agent may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for sale, and such sale may, without further notice, be made at the time and place to which the same was so adjourned. In case any sale of all or any part of the Collateral is made on credit or for future delivery, the Collateral so sold may be retained by the Collateral Agent until the sale price is paid by the purchaser or purchasers thereof, but the Collateral Agent shall not incur any liability in case any such purchaser or purchasers shall fail to take up and pay for the Collateral so sold and, in case of any such failure, such Collateral may be sold again upon like notice. At any public (or, to the extent permitted by Law, private) sale made pursuant to this Agreement, any Secured Party may bid for or purchase, free (to the extent permitted by Law) from any right of redemption, stay, valuation or appraisal on the part of any Grantor (all said rights being also hereby waived and released to the extent permitted by Law), the Collateral or any part thereof offered for sale and may make payment on account thereof by using any claim then due and payable to such Secured Party from any Grantor as a credit against the purchase price, and such Secured Party may, upon compliance with the terms of sale, hold, retain and dispose of such property without further accountability to any Grantor therefor. For purposes hereof, a written agreement to purchase the Collateral or any portion thereof shall be treated as a sale thereof; the Collateral Agent shall be free to carry out such sale pursuant to such agreement and no Grantor shall be entitled to the return of the Collateral or any portion thereof subject thereto, notwithstanding the fact that after the Collateral Agent shall have entered into such an agreement all Events of Default shall have been remedied and the Secured Obligations paid in full. As an alternative to exercising the power of sale herein conferred upon it, the Collateral Agent may proceed by a suit or suits at Law or in equity to foreclose this Agreement and to sell the Collateral or any portion thereof pursuant to a judgment or decree of a court or courts having competent jurisdiction or pursuant to a proceeding by a court-appointed receiver. Any sale pursuant to the provisions of this Section 4.01 shall be deemed to conform to the commercially reasonable standards as provided in Section 9-610(b) of the UCC or its equivalent in other jurisdictions.

 

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Section 4.02 Application of Proceeds. Subject to the Second Lien Intercreditor Agreement, the Collateral Agent shall deliver the proceeds of any collection or sale of Collateral, including any Collateral consisting of cash to the Trustee for application in accordance with Section 6.10 of the Indenture.

The Collateral Agent shall have absolute discretion as to the time of application of any such proceeds, moneys or balances in accordance with this Agreement. Upon any sale of Collateral by the Collateral Agent (including pursuant to a power of sale granted by statute or under a judicial proceeding), the receipt of the Collateral Agent or of the officer making the sale shall be a sufficient discharge to the purchaser or purchasers of the Collateral so sold and such purchaser or purchasers shall not be obligated to see to the application of any part of the purchase money paid over to the Collateral Agent or such officer or be answerable in any way for the misapplication thereof.

The Collateral Agent shall have no liability to any of the Secured Parties for actions taken in reliance on information supplied to it as to the amounts of unpaid principal and interest and other amounts outstanding with respect to the Secured Obligations; provided that nothing in this sentence shall prevent any Grantor from contesting any amounts claimed by any Secured Party in any information so supplied. All distributions made by the Collateral Agent pursuant to this Section 4.02 shall be (subject to any decree of any court of competent jurisdiction) final (absent manifest error), and the Collateral Agent shall have no duty to inquire as to the application by the Trustee of any amounts distributed to it.

Section 4.03 Grant of License to Use Intellectual Property. For the exclusive purpose of enabling the Collateral Agent to exercise rights and remedies under this Agreement at such time as the Collateral Agent shall be lawfully entitled to exercise such rights and remedies at any time after and during the continuance of an Event of Default, each Grantor hereby grants to the Collateral Agent a nonexclusive, royalty-free, limited license (until the termination or cure of the Event of Default) to use, license or sublicense any of the Intellectual Property now owned or hereafter acquired by such Grantor, and wherever the same may be located, and including in such license access to all media in which such licensed items may be recorded or stored and to all computer software and programs used for the compilation or printout thereof; provided, however, that all of the foregoing rights of the Collateral Agent to use such licenses, sublicenses and other rights, and (to the extent permitted by the terms of such licenses and sublicenses) all licenses and sublicenses granted thereunder, shall expire immediately upon the termination or cure of all Events of Default and shall be exercised by the Collateral Agent solely during the continuance of an Event of Default and upon prior written notice to the applicable Grantor; provided, further, that nothing in this Section 4.03 shall require Grantors to grant any license that is prohibited by any rule of law, statute or regulation, or is prohibited by, or constitutes a breach or default under or results in the termination of any contract, license, agreement, instrument or other document evidencing, giving rise to or theretofore granted, to the extent permitted by the Indenture, with respect to such property or otherwise unreasonably prejudices the value thereof to the relevant Grantor; provided, further, that such licenses granted hereunder with respect to Trademarks material to the business of such Grantor shall be subject to restrictions, including, without limitation restrictions as to goods or services associated with such Trademarks and the maintenance of quality standards with respect to the goods and services on which such Trademarks are used, sufficient to preserve the validity and value of such Trademarks. For the avoidance of doubt, the use of such license by the Collateral Agent may be exercised, at the option of the Collateral Agent, only during the continuation of an Event of Default and notice to the applicable Grantor. Upon the occurrence and during the continuance of an Event of Default and upon notice to the applicable Grantor, the Collateral Agent may also exercise the rights afforded under Section 4.01 of this Agreement with respect to Intellectual Property contained in the Article 9 Collateral.

 

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ARTICLE V

Subordination

Section 5.01 Subordination.

(a) Notwithstanding any provision of this Agreement to the contrary, all rights of the Grantors of indemnity, contribution or subrogation under applicable law or otherwise shall be fully subordinated to the payment in full in cash of the Secured Obligations. No failure on the part of the Issuers or any Grantor to make the payments required under applicable law or otherwise shall in any respect limit the obligations and liabilities of any Grantor with respect to its obligations hereunder, and each Grantor shall remain liable for the full amount of the obligations of such Grantor hereunder.

(b) Each Grantor hereby agrees that upon the occurrence and during the continuance of an Event of Default and after notice from the Collateral Agent, all Indebtedness owed to it by any other Grantor shall be fully subordinated to the payment in full in cash of the Secured Obligations; provided that unless the Collateral Agent notifies each Grantor that such payments may not be made, each Grantor shall be permitted to make (or receive) payments on any intercompany note owed to (or by) a Grantor.

ARTICLE VI

Miscellaneous

Section 6.01 Notices. All communications and notices hereunder shall (except as otherwise expressly permitted herein) be in writing and given as provided in Section 12.02 of the Indenture. All communications and notices hereunder to the Issuers or any other Grantor shall be given to it in care of the Issuers as provided in Section 12.02 of the Indenture.

Section 6.02 Waivers: Amendment.

(a) No failure or delay by any Secured Party in exercising any right, remedy, power or privilege hereunder or under any other Indenture Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, remedy, power or privilege, or any abandonment or dis continuance of steps to enforce such rights, remedies, powers or privileges hereunder, preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges of the Secured Parties herein provided, and provided under each other Indenture Document, are cumulative and are not exclusive of any rights, remedies, powers and privileges provided by Law, No waiver of any provision of this Agreement or consent to any departure by any Grantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section 6.02, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default, regardless of whether any Secured Party may have had notice or knowledge of such Default at the time.

(b) Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Collateral Agent and the Grantor or Grantors with respect to which such waiver, amendment or modification is to apply, subject to any consent required in accordance with Article 9 of the Indenture.

 

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Section 6.03 Collateral Agent’s Fees and Expenses; Indemnification.

(a) The parties hereto agree that the Collateral Agent shall be entitled to reimbursement of its reasonable out-of-pocket expenses incurred hereunder and indemnity for its actions in connection herewith, in each case, as provided in Section 7.07 of the Indenture.

(b) Any such amounts payable as provided hereunder shall be additional Secured Obligations secured hereby and by the other Collateral Documents. The provisions of this Section 6.03 shall remain operative and in full force and effect regardless of the termination of this Agreement or any other Indenture Document, the consummation of the transactions contemplated hereby, the repayment of any of the Secured Obligations, the invalidity or unenforceability of any term or provision of this Agreement or any other Indenture Document, or any investigation made by or on behalf of the Collateral Agent or any other Secured Party. All amounts due under this Section 6.03 shall be payable within 10 days of written demand therefor.

Section 6.04 Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

Section 6.05 [Reserved].

Section 6.06 Counterparts; Effectiveness; Several Agreement. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery by facsimile or other electronic communication of an executed counterpart (including portable document format (PDF)) of a signature page to this Agreement shall be effective as delivery of an original executed counterpart of this Agreement. This Agreement shall become effective as to any Grantor when a counterpart hereof executed on behalf of such Grantor shall have been delivered to the Collateral Agent and a counterpart hereof shall have been executed on behalf of the Collateral Agent, and thereafter shall be binding upon such Grantor and the Collateral Agent and their respective permitted successors and assigns, and shall inure to the benefit of such Grantor, the Collateral Agent and the other Secured Parties and their respective permitted successors and assigns, except that no Grantor shall have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral (and any such assignment or transfer shall be void) except as expressly permitted by this Agreement or the Indenture. This Agreement shall be construed as a separate agreement with respect to each Grantor and may be amended, modified, supplemented, waived or released with respect to any Grantor without the approval of any other Grantor and without affecting the obligations of any other Grantor hereunder.

Section 6.07 Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable, the legality, validity and enforceability of the remaining provisions of this Agreement shall not be affected or impaired thereby. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

Section 6.08 Right of Set-Off. In addition to any rights and remedies of the Secured Parties provided by Law, upon the occurrence and during the continuance of any Event of Default, each Secured Party and its Affiliates is authorized at any time and from time to time, without prior notice to any Grantor, any such notice being waived by each Grantor to the fullest extent permitted by applicable Law, to set-off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other Indebtedness at any time owing by, such Secured Party and its Affiliates to or for the credit or the account of the respective Grantors against any and all Secured Obligations owing to such Secured Party and its Affiliates hereunder, now or hereafter existing, irrespective of whether or not such Secured Party or Affiliate shall have made demand under this Agreement and although such Secured Obligations may be contingent or unmatured or denominated in a currency different from that of the applicable deposit or Indebtedness. Each Secured Party agrees promptly to notify the applicable Grantor

 

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and the Collateral Agent after any such set-off and application made by such Secured Patty; provided,, that the failure to give such notice shall not affect the validity of such set-off and application. The rights of each Secured Party under this Section 6.08 are in addition to other rights and remedies (including other rights of set-off) that such Secured Party may have at Law.

Section 6.09 Governing Law; Jurisdiction; Venue; Waiver of Jury Trial; Consent to Service of Process.

(a) The terms of Sections 12.09 and 12.16 of the Indenture with respect to governing law, submission of jurisdiction, venue and waiver of jury trial are incorporated herein by reference, mutatis mutandis, and the parties hereto agree to such terms. This Agreement and the rights and obligations of the parties hereto shall be governed by, and construed and interpreted in accordance with, the law of the State of New York.

(b) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 6.01. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by Law.

Section 6.10 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement.

Section 6.11 Security Interest Absolute. To the extent permitted by Law, all rights of the Collateral Agent hereunder, the Security Interest, the grant of a security interest in the Collateral and all obligations of each Grantor hereunder shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of the Indenture, any agreement with respect to any of the Secured Obligations or any other agreement or instrument relating to any of the foregoing, (b) any change in the time, manner or place of payment of, or in any other term of, all or any of the Secured Obligations, or any other amendment or waiver of or any consent to any departure from the Indenture or any other agreement or instrument, (c) any exchange, release or non-perfection of any Lieu on other collateral, or any release or amendment or waiver of or consent under or departure from any guarantee, securing or guaranteeing all or any of the Secured Obligations or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, any Grantor in respect of the Secured Obligations or this Agreement.

Section 6.12 Termination or Release.

(a) This Agreement, the Security Interest and all other security interests granted hereby shall terminate with respect to all Secured Obligations and any Liens arising therefrom shall be automatically released upon (i) payment in full of all Secured Obligations (other than contingent obligations not yet accrued and payable) or (ii) legal defeasance, covenant defeasance or discharge under Article 8 of the Indenture.

(b) A Subsidiary Party shall automatically be released from its obligations hereunder and the Security Interest in the Collateral of such Subsidiary Party shall be automatically released upon the consummation of any transaction permitted by the Indenture as a result of which such Subsidiary Party ceases to be a Subsidiary of Holdings or becomes an Excluded Subsidiary.

(c) The Security Interest in any Collateral shall be automatically released upon the consummation of any transaction permitted by the Indenture as a result of which such Collateral becomes an Excluded Asset.

 

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(d) Upon any sale or transfer by any Grantor of any Collateral that is permitted under the Indenture (other than a sale or transfer to another Grantor), or upon the effectiveness of any written consent to the release of the security interest granted hereby in any Collateral pursuant to Section 9.02 of the Indenture, the security interest in such Collateral shall be automatically released.

(e) In connection with any termination or release pursuant to paragraph (a), (b), (c) or (d) of this Section 6.12, the Collateral Agent shall promptly execute and deliver to any Grantor, at such Grantor’s expense, all documents that such Grantor shall reasonably request to evidence such termination or release and shall perform such other actions reasonably requested by such Grantor to effect such re lease, including delivery of certificates, securities, instruments and written releases, terminations and similar documents. Any execution and delivery of documents pursuant to this Section 6.12 shall be with out recourse to or warranty by the Collateral Agent and subject, if requested by the Collateral Agent, to the Collateral Agent’s receipt of a certification by the Issuers and applicable Grantor stating that such transaction is in compliance with the Indenture and the other Indenture Documents and as to such other matters as the Collateral Agent may reasonably request.

Section 6.13 Additional Grantors. The Grantors shall cause each Restricted Subsidiary of Holdings which, from time to time, after the date hereof shall be required to pledge any assets to the Collateral Agent for the benefit of the Secured Parties pursuant to the provisions of the Indenture, (i) to execute and deliver to the Collateral Agent a Security Agreement Supplement and (ii) a Perfection Certificate, in each case, (x) with respect to the Acquired Business, on or prior to the Post-Closing Collateral Date, and (y) with respect to any other Subsidiary, within sixty (60) days of the date on which it was acquired, created or otherwise required to become a Grantor hereunder or such longer period as the Credit Agreement Collateral Agent or any other Senior Representative, or, if such Credit Agreement Collateral Agent or Senior Representative does not exist, the Collateral Agent, may agree in writing in its sole discretion. Upon execution and delivery by the Collateral Agent and a Restricted Subsidiary of a Security Agreement Supplement, such Restricted Subsidiary shall become a Grantor hereunder with the same force and effect as if originally named as a Grantor herein. The execution and delivery of any such instrument shall not require the consent of any other Grantor hereunder. The rights and obligations of each Grantor hereunder shall remain in full force and effect notwithstanding the addition of any new Grantor as a party to this Agreement.

Section 6.14 Collateral Agent Appointed Attornev-in-Fact. Each Grantor hereby appoints the Collateral Agent (and all officers, employees or agents designated by the Collateral Agent) as such Grantor’s true and lawful agent (and attorney-in-fact) of such Grantor for the purpose of carrying out the provisions of this Agreement and the other Collateral Documents and taking any action and executing any instrument that the Collateral Agent may deem necessary or advisable to accomplish the purposes hereof or thereof at any time after and during the continuance of an Event of Default, which appointment is irrevocable and coupled with an interest. Without limiting the generality of the foregoing, the Collateral Agent shall have the right, upon the occurrence and during the continuance of an Event of Default and notice by the Collateral Agent to the applicable Grantor of the Collateral Agent’s intent to exercise such rights, with full power of substitution either in the Collateral Agent’s name or in the name of such Grantor (a) to receive, endorse, assign and/or deliver any and all notes, acceptances, checks, drafts, money orders or other evidences of payment relating to the Collateral or any part thereof; (b) to demand, collect, receive payment of, give receipt for and give discharges and releases of all or any of the Collateral or Mortgaged Property; (c) to sign the name of any Grantor on any invoice or bill of lading relating to any of the Collateral or Mortgaged Property; (d) to send verifications of Accounts Receivable to any Account Debtor; (e) to commence and prosecute any and all suits, actions or proceedings at Law or in equity in any court of competent jurisdiction to collect or otherwise realize on all or any of the Collateral or Mortgaged Property or to enforce any rights in respect of any Collateral or Mortgaged Property; (f) to settle, compromise, compound, adjust or defend any actions, suits or proceedings relating to all or any of the

 

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Collateral or Mortgaged Property; (g) to require any Grantor to notify, Account Debtors to make payment directly to the Collateral Agent; (h) to make, settle and adjust claims in respect of Article 9 Collateral or Mortgaged Property under policies of insurance, endorsing the name of such Grantor on any check, draft, instrument or other item of payment for the proceeds of such policies of insurance; (i) to make all determinations and decisions with respect thereto; (j) to obtain or maintain the policies of insurance required by Section 4.14 of the Indenture or paying any premium in whole or in part relating thereto; and (k) to use, sell, assign, transfer, pledge, make any agreement with respect to or otherwise deal with all or any of the Collateral or Mortgaged Property, and to do all other acts and things necessary to carry out the purposes of this Agreement and the other Collateral Documents, as fully and completely as though the Collateral Agent were the absolute owner of the Collateral or Mortgaged Property for all purposes; provided that nothing herein contained shall be construed as requiring or obligating the Collateral Agent to make any commitment or to make any inquiry as to the nature or sufficiency of any payment received by the Collateral Agent, or to present or file any claim or notice, or to take any action with respect to the Collateral or Mortgaged Property or any part thereof or the moneys due or to become due in respect thereof or any property covered thereby. The Collateral Agent and the other Secured Parties shall be accountable only for amounts actually received as a result of the exercise of the powers granted to them herein, and neither they nor their officers, directors, employees or agents shall be responsible to any Grantor for any act or failure to act hereunder, except for their own gross negligence, bad faith, or willful misconduct or that of any of their Affiliates, directors, officers, employees, counsel, agents or attorneys-in-fact, in each case, as determined by a final non-appealable judgment of a court of competent jurisdiction. All sums disbursed by the Collateral Agent in connection with this paragraph, including reasonable attorneys’ fees, court costs, expenses and other charges relating thereto, shall be payable by the Grantors to the Collateral Agent to the extent contemplated by Section 7.07 of the Indenture and shall be additional Secured Obligations secured hereby.

Section 6.15 General Authority of the Collateral Agent. By acceptance of the benefits of this Agreement and any other Collateral Documents, each Secured Party (whether or not a signatory hereto) shall be deemed irrevocably (a) to consent to the appointment of the Collateral Agent as its agent hereunder and under such other Collateral Documents, (b) to confirm that the Collateral Agent shall have the authority to act as the exclusive agent of such Secured Party for the enforcement of any provisions of this Agreement and such other Collateral Documents against any Grantor, the exercise of remedies hereunder or thereunder and the giving or withholding of any consent or approval hereunder or thereunder relating to any Collateral or any Grantor’s obligations with respect thereto, (c) to agree that it shall not take any action to enforce any provisions of this Agreement or any other Collateral Document against any Grantor, to exercise any remedy hereunder or thereunder or to give any consents or approvals hereunder or thereunder except as expressly provided in this Agreement or any other Collateral Document and (d) to agree to be bound by the terms of this Agreement and any other Collateral Documents.

Section 6.16 Reasonable Care. The Collateral Agent is required to use reasonable care in the custody and preservation of any of the Collateral in its possession; provided, that the Collateral Agent shall be deemed to have used reasonable care in the custody and preservation of any of the Collateral, if such Collateral is accorded treatment substantially similar to that which the Collateral Agent accords its own property.

Section 6.17 Reinstatement. The obligations of the Grantors under this Agreement shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of the Issuers or other Grantor in respect of the Secured Obligations is rescinded or must be otherwise restored by any holder of any of the Secured Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise.

 

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Section 6.18 Miscellaneous. The Collateral Agent shall not be deemed to have actual, constructive, direct or indirect notice or knowledge of the occurrence of any Event of Default unless and until the Collateral Agent shall have received a notice of Event of Default or a notice from the Grantor or the Secured Parties to the Collateral Agent in its capacity as Collateral Agent indicating that an Event of Default has occurred.

Section 6.19 Conflicts; Intercreditor Agreement. Notwithstanding anything herein to the contrary, the lien and security interest granted to the Collateral Agent pursuant to this Agreement and the exercise of any right or remedy by the Collateral Agent hereunder are subject to the provisions of the Second Lien Intercreditor Agreement. In the event of any conflict between the terms of the Second Lien Intercreditor Agreement and this Agreement, the terms of the Second Lien Intercreditor Agreement shall govern and control.

Section 6.20 Post-Closing Collateral. Notwithstanding anything herein to the contrary, certain matters relating to Collateral and Mortgaged Properties shall be completed by the Post Closing Collateral Date as provided in Section 10.08 of the Indenture.

Section 6.21 Non-US Grantors. Notwithstanding anything to the contrary in this Agreement, the parties hereto agree that (a) with respect to each Grantor that is not a Domestic Grantor (the “Foreign Grantors”), Collateral shall be limited to now owned or hereafter acquired (i) Capital Stock of the Domestic Subsidiaries owned by such Grantor, (ii) all dividends and distributions in respect thereof, (iii) all rights relating thereto or arising thereunder and (iv) all proceeds thereof (collectively the “US Collateral”) and (b) the representations, warranties and covenants set forth herein shall apply to the Foreign Grantors only with respect to the respective US Collateral.

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date first written above.

 

PINAFORE, LLC
By:  

/s/ Donald West

  Name:   Donald West
  Title:   Authorized Officer
PINAFORE, INC.
By:  

/s/ Donald West

  Name:   Donald West
  Title:   Authorized Officer

U.S. Second Lien Notes Security Agreement Signature Page

PINAFORE ACQUISITIONS LIMITED
By:  

/s/ Todd Clegg

  Name: Todd Clegg
  Title:   Authorized Officer

U.S. Second Lien Notes Security Agreement Signature Page

PINAFORE HOLDINGS B.V.

By:

  

/s/ Donald West

  Name:  Donald West
  Title:    Authorized Officer

U.S. Second Lien Notes Security Agreement Signature Page

 

CARRIAGE HOUSE FRUIT COMPANY

BROADWAY MISSISSIPPI DEVELOPMENT, LLC

GATES DEVELOPMENT CORPORATION

GATES INTERNATIONAL HOLDINGS, LLC

AIR SYSTEM COMPONENTS, INC.

AQUATlC CO.

AQUATIC TRUCKING CO.

BUFFALO HOLDING COMPANY

CONERGICS CORPORATION

DEXTER AXLE ACQUISITION CORP.

DEXTER AXLE COMPANY

DEXTER AXLE TRUCKING COMPANY

EPICOR INDUSTRIES, INC.

GATES MECTROL, INC.

 

HART & COOLEY TRUCKING COMPANY

HART & COOLEY, INC.

NRG INDUSTRIES, INC. (Delaware entity)

PLEWS, INC.

RUSKIN COMPANY

RUSKIN SERVICE COMPANY

SCHRADER ELECTRONICS, INC.

SCHRADER INTERNATIONAL HOLDING CO.

SCHRADER, LLC

SCHRADER-BRIDGEPORT INTERNATIONAL, INC.

SELKIRK AMERICAS, L.P.

SELKIRK CANADA HOLDINGS, L.P.

SELKIRK CORPORATION

SELKIRK IP L.L.C.

THE GATES CORPORATION

TOMKINS AUTOMOTIVE HOLDING CO.

TOMKINS CORPORATION

TOMKINS U.S., L.P.

WALTHAM REAL ESTATE HOLDING CO.

By:

  

/s/ John Zimmerman

  Name:  John Zimmerman
  Title:    Authorized Officer

U.S. Second Lien Notes Security Agreement Signature Page

E INDUSTRIES, INC,

KOCH FILTER CORPORATION

DEXTER CHASSIS GROUP, INC.

EASTERN SHEET METAL, INC.

FBN TRANSPORTATION, INC.

TOMKINS INDUSTRIES, INC.

IDEAL CLAMP PRODUCTS, INC.

GLASS MASTER CORPORATION

NATIONAL DUCT SYSTEMS, INC.

NRG INDUSTRIES, INC. (Texas entity)

ROOFTOP SYSTEMS, INC.

HYTEC, INC.

By:

  

/s/ John Zimmerman

  Name:   John Zimmerman
  Title:   Authorized Officer

U.S. Second Lien Notes Security Agreement Signature Page

TOMKINS AUTOMOTIVE COMPANY, S.A R.L. TOMKINS LUXEMBOURG, S.A R.L.
BY:  

/s/ J.W. Zimmerman

  Name:   J.W. Zimmerman
  Title:   CFO

MONTISK INVESTMENTS NETHERLANDS C.V.

By:

  

/s/ James Nicol

Name:

   James Nicol

Title:

   Authorized Officer

Representing each of

Tomkins Investments Company S.a.r.l,

Tomkins American Investments S.a.r.l. and

Tomkins Luxembourg S.a.r.l. for itself and

Montisk Investments Netherlands C.V.

U.S. Second Lien Notes Security Agreement Signature Page

GATES HOLDINGS LIMITED
TOMKINS ENGINEERING LIMITED
TOMKINS OVERSEAS INVESTMENTS
LIMITED
By:  

/s/ James Nicol

Name:   James Nicol
Title:   Authorized Signatory

U.S. Second Lien Notes Security Agreement Signature Page

TOMKINS SC1 LIMITED
By:  

/s/ John Zimmerman

  Name:  John Zimmerman
  Title:    Attorney

U.S. Second Lien Notes Security Agreement Signature Page

WILMINGTON TRUST FSB, as Collateral Agent
By:  

/s/ Joseph P O’Donnell

  Name: Joseph P O’Donnell
  Title:   Vice President

U.S. Second Lien Notes Security Agreement Signature Page

Schedule I to

the Security Agreement

SUBSIDIARY PARTIES

Pinafore, LLC

Pinafore, Inc.

Selkirk Americas, L.P.

Selkirk Canada Holdings LP

Selkirk IP L.L.C.

Schrader, LLC

Tomkins U.S., L.P.

Tomkins Corporation

Tomkins Industries, Inc.

Eastern Sheet Metal, Inc.

FBN Transportation, Inc.

HYTEC, INC.

Conergics Corporation

Dexter Axle Company

Dexter Axle Trucking Company

E INDUSTRIES, INC.

Dexter Axle Acquisition Corp.

Dexter Chassis Group, Inc.

Hart & Cooley, Inc.

Hart & Cooley Trucking Company

Aquatic Co.

Aquatic Trucking Co.

Air System Components, Inc.

Selkirk Corporation

NRG Industries, Inc. (Delaware entity)

NRG Industries, Inc. (Texas entity)

GLASS MASTER CORPORATION

ROOFTOP SYSTEMS, INC.

National Duct Systems, Inc.

Ruskin Company

Ruskin Service Company

Koch Filter Corporation

Tomkins Automotive Holding Co.

Plews, Inc.

Schrader Electronics, Inc.

EPICOR Industries, Inc.

Ideal Clamps Products Inc

Buffalo Holding Company

Waltham Real Estate Holding Co.

Schrader-Bridgeport International, Inc.

Schrader International Holding Co.

CARRIAGE HOUSE FRUIT COMPANY

THE GATES CORPORATION

Gates Development Corporation

Broadway Mississippi Development, LLC

GATES INTERNATIONAL HOLDINGS, LLC

Gates Mectrol, Inc.

Tomkins Engineering Limited

Gates Holdings Limited

Tomkins Overseas Investments Limited

Montisk Investments Netherlands C.V.

Tomkins Luxembourg S.a r.l

Tomkins American Investments S.a r.l

Exhibit I to the

Security Agreement

SUPPLEMENT NO.      dated as of [·], to the U.S. Second Lien Notes Security Agreement (the “Security Agreement”), dated as of September 29, 2010, by and among the Grantors identified therein and Wilmington Trust FSB, as Collateral Agent.

A. Reference is made to that certain Indenture dated as of September 29,2010 (as amended, restated, supplemented or otherwise modified from time to time, the “Indenture”), by and among PINAFORE, LLC, a Delaware limited liability company, PINAFORE, INC., a Delaware corporation (collectively, the “Issuers”), PINAFORE HOLDINGS B.V. (“Holdings”), the other Guarantors from time to time party thereto and Wilmington Trust FSB, as Trustee and Collateral Agent, pursuant to which the Issuers have issued $1,150,000,000 aggregate principal amount of 9.0% Senior Secured Second Lien Notes due 2018.

B. Capitalized terms used herein and not otherwise defined herein shall have the respective meanings assigned to such terms in the Indenture and the Security Agreement, in each case, as applicable.

C. Section 6.13 of the Security Agreement provides that additional Restricted Subsidiaries of Holdings may become Grantors under the Security Agreement by execution and delivery of an instrument in the form of this Supplement. The undersigned (the “New Grantor”) is executing this Supplement in accordance with the requirements of the Indenture to become a Grantor under the Security Agreement.

Now, therefore, in consideration of the premises, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and with the intent to be legally bound hereby, the Collateral Agent and the New Grantor hereby agree as follows:

SECTION 1. In accordance with Section 6.13 of the Security Agreement, the New Grantor by its signature below becomes a Grantor under the Security Agreement with the same force and effect as if originally named therein as a Grantor and the New Grantor hereby (a) agrees to all the terms and provisions of the Security Agreement applicable to it as a Grantor thereunder and (b) represents and warrants that the representations and warranties made by it as a Grantor thereunder are true and correct in all material respects on and as of the date hereof. In furtherance of the foregoing, the New Grantor, as security for the payment and performance in full of the Secured Obligations, does hereby collaterally assign and pledge to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, and hereby grants to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties a security interest in all of the New Grantor’s right, title and interest in and to the Collateral (as defined in the Security Agreement) of the New Grantor. Each reference to a “Grantor” in the Security Agreement shall be deemed to include the New Grantor. The Security Agreement is hereby incorporated herein by reference.

SECTION 2. The New Grantor 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 such enforceability may be limited by Debtor Relief Laws and by general principles of equity.

SECTION 3. This Supplement 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. This Supplement shall become effective when the Collateral Agent shall have received a counterpart of this Supplement that bears the signature of the New Grantor and the Collateral Agent has executed a counterpart hereof. Delivery of an executed signature page to this Supplement by facsimile transmission or other electronic communication shall be as effective as delivery of a manually signed counterpart of this Supplement.

SECTION 4. The New Grantor hereby represents and warrants that (a) set forth on Schedule I attached hereto is a true and correct schedule of the information required by Schedules II and III to the Security Agreement applicable to it and its and its’ subsidiaries legal name, jurisdiction of formation and location of Chief Executive Office and (b) set forth under its signature hereto is the true and correct legal name of the New Grantor, its jurisdiction of formation and the location of its chief executive office.

SECTION 5. Except as expressly supplemented hereby, the Security Agreement shall remain in full force and effect.

SECTION 6. THE TERMS OF SECTIONS 12.09 AND 12.16 OF THE INDENTURE WITH RESPECT TO GOVERNING LAW, SUBMISSION OF JURISDICTION, VENUE AND WAIVER OF JURY TRIAL ARE INCORPORATED HEREIN BY REFERENCE, MUTATIS MUTANDIS, AND THE PARTIES HERETO AGREE TO SUCH TERMS.

SECTION 7. EACH PARTY TO THIS SUPPLEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 6.01 OF THE SECURITY AGREEMENT. NOTHING IN THIS SUPPLEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS SUPPLEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

SECTION 8. Neither this Supplement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Collateral Agent and the Grantor or Grantors with respect to which such waiver, amendment or modification is to apply, subject to any consent required in accordance with Article 9 of the Indenture and subject to Section 6.02 of the Security Agreement.

SECTION 9. If any provision of this Supplement is held to be illegal, invalid or unenforceable, the legality, validity and enforceability of the remaining provisions of this Supplement shall not be affected or impaired thereby. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

SECTION 10. All communications and notices hereunder shall be in writing and given as provided in Section 6.01 of the Security Agreement.

SECTION 11. The New Grantor agrees to reimburse the Collateral Agent for its reasonable out-of-pocket expenses in connection with the execution and delivery of this Supplement, including the reasonable fees, other charges and disbursements of counsel for the Collateral Agent, in each case, to the extent contemplated by Section 7.07 of the Indenture.

[Signature pages follow]

 

-2-

IN WITNESS WHEREOF, the New Grantor and the Collateral Agent have duly executed this Supplement to the Security Agreement as of the day and year first above written.

 

[NAME OF NEW GRANTOR]
By:  

 

Name:  

 

Title:  

 

Legal Name:
Jurisdiction of Formation:
Location of Chief Executive office:

WILMINGTON TRUST FSB,

as Collateral Agent

By:

  

 

Name:

  

 

Title:

  

 

 

-2-

Schedule I

to the Supplement No_ to the

Security Agreement

 

EQUITY INTERESTS

  

Issuer

    Number  of
Certificate		      Registered
Owner		      Number and
Class of
Equity Interest		      Percentage
of Equity  Interests		  
           
           

 

INSTRUMENTS AND DEBT SECURITIES   

Issuer

    Principal
Amount		      Date of Note      Maturity Date  
        
        

Exhibit II to the

Security Agreement

[FORM OF] PERFECTION CERTIFICATE

[Provided under separate cover.]

Exhibit III to the

Security Agreement

FORM OF

PATENT SECURITY AGREEMENT (SHORT FORM)

PATENT SECURITY AGREEMENT

Patent Security Agreement, dated as of [     ], by [         ] and [            ] (the “Grantor”), in favor of WILMINGTON TRUST FSB, in its capacity as collateral agent pursuant to the Indenture (in such capacity, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Grantor is party to that certain U.S. Second Lien Notes Security Agreement dated as of September 29,2010 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Security Agreement”), by the Grantors identified therein in favor of the Collateral Agent, pursuant to which the Grantor is required to execute and deliver to the Collateral Agent this Patent Security Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the Collateral Agent, for the benefit of the Secured Parties, to enter into the Indenture, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and with the intent to be legally bound hereby, the Grantor hereby agrees with the Collateral Agent as follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the Indenture or the Security Agreement and used herein have the respective meanings assigned thereto in the Indenture or the Security Agreement, in each case, as applicable.

SECTION 2. Grant of Security Interest in Patent Collateral. The Grantor hereby collaterally assigns and pledges to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, and hereby grants to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties a security interest in and to all of its right, title and interest in, to and under all the following Collateral (excluding any Excluded Assets) of the Grantor:

(a) Patents of the Grantor listed on Schedule I attached hereto; and

(b) all products and Proceeds of any of the foregoing (together with (a), collectively, the “Patents”).

SECTION 3. The Security Agreement. The security interests granted pursuant to this Patent Security Agreement are granted in conjunction with the security interests granted to the Collateral Agent pursuant to the Security Agreement, and the Grantor hereby acknowledges and affirms that the rights and remedies of the Collateral Agent with respect to the security interests in the Patents made and granted hereby are more fully set forth in the Security Agreement. In the event that any provision of this Patent Security Agreement is deemed to conflict with the Security Agreement, the provisions of the Security Agreement shall control unless the Collateral Agent shall otherwise determine.

SECTION 4. Termination. Upon the termination of the Security Agreement in accordance with, or as otherwise required pursuant to, Section 6.12 thereof, the Collateral Agent shall, at the

expense of the Grantor, execute, acknowledge, and deliver to the Grantor an instrument in writing in recordable form releasing the liens on and security interests in the applicable Patents under this Patent Security Agreement and any other documents required to evidence the termination of the Collateral Agent’s interests in the applicable Patents.

SECTION 5. GOVERNING LAW; JURISDICTION; VENUE; WAIVER OF JURY TRIAL; CONSENT TO SERVICE OF PROCESS.

(a) THE TERMS OF SECTIONS 12.09 AND 12.16 OF THE INDENTURE WITH RESPECT TO GOVERNING LAW, SUBMISSION OF JURISDICTION, VENUE AND WAIVER OF JURY TRIAL ARE INCORPORATED HEREIN BY REFERENCE, MUTATIS MUTANDIS, AND THE PARTIES HERETO AGREE TO SUCH TERMS.

(b) EACH PARTY TO THIS PATENT SECURITY AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 6.01 OF THE SECURITY AGREEMENT. NOTHING IN THIS PATENT SECURITY AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS PATENT SECURITY AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

SECTION 6. Waivers; Amendments: Modifications. Neither this Patent Security Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Collateral Agent and the Grantor or Grantors with respect to which such waiver, amendment or modification is to apply, subject to any consent required in accordance with Article 9 of the Indenture and subject to Section 6.02 of the Security Agreement.

SECTION 7. All communications and notices under this Patent Security Agreement shall be in writing and given as provided in Section 6.01 of the Security Agreement.

SECTION 8. Counterparts: Effectiveness. This Patent Security Agreement may be executed in any number of counterparts, all of which shall constitute one and the same instrument, and any party hereto may execute this Patent Security Agreement by signing and delivering to the other party hereto one or more counterparts. Delivery by facsimile or other electronic communication of an executed counterpart (including portable document format (PDF)) of a signature page to this Patent Security Agreement shall be effective as delivery of an original executed counterpart of this Patent Security Agreement. This Patent Security Agreement shall become effective as to the Grantor when a counterpart hereof executed on behalf of the Grantor shall have been delivered to the Collateral Agent and a counterpart hereof shall have been executed on behalf of the Collateral Agent, and thereafter shall be binding upon the Grantor and the Collateral Agent and their respective permitted successors and assigns, and shall inure to the benefit of the Grantor, the Collateral Agent and the other Secured Parties and their respective permitted successors and assigns, except that the Grantor shall not have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral (and any such assignment or transfer shall be void) except as expressly contemplated by the Security Agreement or the Indenture.

[Signature Pages Follow.]

 

-2-

[GRANTOR]
By:  

 

  Name:
  Title:

 

-3-

WILMINGTON TRUST FSB,

as Collateral Agent

By:  

 

  Name:
  Title:

 

-4-

Schedule I

to

PATENT SECURITY AGREEMENT

UNITED STATES PATENTS AND PATENT APPLICATIONS

Patents:

 

Table to Come

Patent Applications:

 

Table to Come

 

Exhibit IV to the

Security Agreement

FORM OF

TRADEMARK SECURITY AGREEMENT (SHORT FORM)

TRADEMARK SECURITY AGREEMENT

Trademark Security Agreement, dated as of [    ], by [    ] and [            ] (the “Grantor”), in favor of WILMINGTON TRUST FSB, in its capacity as collateral agent pursuant to the Indenture (in such capacity, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Grantor is party to that certain U.S. Second Lien Notes Security Agreement dated as of September 29, 2010 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Security Agreement”), by the Grantors identified therein in favor of the Collateral Agent, pursuant to which the Grantor is required to execute and deliver to the Collateral Agent this Trademark Security Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the Collateral Agent, for the benefit of the Secured Parties, to enter into the Indenture, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and with the intent to be legally bound hereby, the Grantor hereby agrees with the Collateral Agent as follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the Indenture or the Security Agreement used herein have the respective meanings assigned thereto in the in the Indenture or the Security Agreement, in each case, as applicable.

SECTION 2. Grant of Security Interest in Trademark Collateral. The Grantor collaterally assigns and pledges to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, and hereby grants to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties a security interest in and to all of its right, title and interest in, to and under all the following Collateral (excluding any Excluded Assets) of the Grantor:

(a) registered Trademarks of the Grantor listed on Schedule I attached hereto; and

(b) all products and Proceeds of any of the foregoing (together with (a), collectively, the “Trademarks”).

SECTION 3. The Security Agreement. The security interests granted pursuant to this Trademark Security Agreement are granted in conjunction with the security interests granted to the Collateral Agent pursuant to the Security Agreement, and the Grantor hereby acknowledges and affirms that the rights and remedies of the Collateral Agent with respect to the security interests in the Trademarks made and granted hereby are more fully set forth in the Security Agreement, in the event that any provision of this Trademark Security Agreement is deemed to conflict with the Security Agreement, the provisions of the Security Agreement shall control unless the Collateral Agent shall otherwise determine.

SECTION 4. Termination. Upon the termination of the Security Agreement in accordance with, or otherwise required pursuant to, Section 6.12 thereof, the Collateral Agent shall, at the expense of the Grantor, execute, acknowledge, and deliver to the Grantor an instrument in writing in recordable

form releasing the lien on and security interest in the applicable Trademarks under this Trademark Security Agreement and any other documents required to evidence the termination of the Collateral Agent’s interest in the applicable Trademarks.

SECTION 5. GOVERNING LAW; JURISDICTION; VENUE; WAIVER OF JURY TRIAL; CONSENT TO SERVICE OF PROCESS.

(a) THE TERMS OF SECTIONS 12.09 AND 12.16 OF THE INDENTURE WITH RESPECT TO GOVERNING LAW, SUBMISSION OF JURISDICTION, VENUE AND WAIVER OF JURY TRIAL ARE INCORPORATED HEREIN BY REFERENCE, MUTATIS MUTANDIS, AND THE PARTIES HERETO AGREE TO SUCH TERMS.

(b) EACH PARTY TO THIS TRADEMARK SECURITY AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 6.01 OF THE SECURITY AGREEMENT. NOTHING IN THIS TRADEMARK SECURITY AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS TRADEMARK SECURITY AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

SECTION 6. Waivers; Amendments; Modifications. Neither this Trademark Security Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Collateral Agent and the Grantor or Grantors with respect to which such waiver, amendment or modification is to apply, subject to any consent required in accordance with Article 9 of the Indenture and subject to Section 6.02 of the Security Agreement.

SECTION 7. Notices; Communications. All communications and notices under this Trademark Security Agreement shall be in writing and given as provided in Section 6.01 of the Security Agreement.

SECTION 8. Counterparts; Effectiveness. This Trademark Security Agreement may be executed in any number of counterparts, all of which shall constitute one and the same instrument, and any party hereto may execute this Trademark Security Agreement by signing and delivering to the other party hereto one or more counterparts. Delivery by facsimile or other electronic communication of an executed counterpart (including portable document format (PDF)) of a signature page to this Trademark Security Agreement shall be effective as delivery of an original executed counterpart of this Trademark Security Agreement. This Trademark Security Agreement shall become effective as to the Grantor when a counterpart hereof executed on behalf of the Grantor shall have been delivered to the Collateral Agent and a counterpart hereof shall have been executed on behalf of the Collateral Agent, and thereafter shall be binding upon the Grantor and the Collateral Agent and their respective permitted successors and assigns, and shall inure to the benefit of the Grantor, the Collateral Agent and the other Secured Parties and their respective permitted successors and assigns, except that the Grantor shall not have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral (and any such assignment or transfer shall be void) except as expressly contemplated by the Security Agreement or the Indenture.

[Signature pages follow]

 

-2-

[GRANTOR]
By:  

 

  Name:
  Title:

 

-3-

WILMINGTON TRUST FSB,

as Collateral Agent

By:  

 

  Name:
  Title:

 

-4-

Schedule I

to

TRADEMARK SECURITY AGREEMENT

UNITED STATES TRADEMARK REGISTRATIONS AND APPLICATIONS

Trademark Registrations:

 

Table to Come

Trademark Applications:

 

Table to Come

 

Exhibit V to the

Security Agreement

FORM OF

COPYRIGHT SECURITY AGREEMENT (SHORT FORM)

COPYRIGHT SECURITY AGREEMENT

Copyright Security Agreement, dated as of [    ], by [    ] and [            ] (the “Grantor”) in favor of WILMINGTON TRUST FSB, in its capacity as collateral agent pursuant to the Indenture (in such capacity, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Grantor is party to that certain U.S. Second Lien Notes Security Agreement dated as of September 29,2010 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Security Agreement”), by the Grantors identified therein in favor of the Collateral Agent, pursuant to which the Grantor is required to execute and deliver to the Collateral Agent this Copyright Security Agreement;

NOW, THEREFORE, in consideration of the premises and to induce the Collateral Agent, for the benefit of the Secured Parties, to enter into the Indenture, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and with the intent to be legally bound hereby, the Grantor hereby agrees with the Collateral Agent as follows:

SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the Indenture or the Security Agreement and used herein have the respective meanings assigned thereto in the Indenture or the Security Agreement, in each case, as applicable.

SECTION 2. Grant of Security Interest in Copyright Collateral. The Grantor hereby collaterally assigns and pledges to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, and hereby grants to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties a security interest in and to all of its right, title and interest in, to and under all the following Collateral (excluding any Excluded Assets) of the Grantor:

(a) registered Copyrights of the Grantor listed on Schedule I attached hereto; and

(b) all products and Proceeds of the foregoing (together with (a), collectively, the “Copyrights”).

SECTION 3. The Security Agreement. The security interests granted pursuant to this Copyright Security Agreement are granted in conjunction with the security interests granted to the Collateral Agent pursuant to the Security Agreement, and the Grantor hereby acknowledges and affirms that the rights and remedies of the Collateral Agent with respect to the security interests in the Copyrights made and granted hereby are more fully set forth in the Security Agreement. In the event that any provision of this Copyright Security Agreement is deemed to conflict with the Security Agreement, the provisions of the Security Agreement shall control unless the Collateral Agent shall otherwise determine.

SECTION 4. Termination. Upon termination of the Security Agreement in accordance with, or as otherwise required pursuant to, Section 6.12 thereof, the Collateral Agent shall, at the expense of the Grantor, execute, acknowledge, and deliver to the Grantor an instrument in writing in recordable

form releasing the lien on and security interest in the applicable Copyrights under this Copyright Security Agreement and any other documents required to evidence the termination of the Collateral Agent’s interest in the applicable Copyrights.

SECTION 5. GOVERNING LAW; JURISDICTION; VENUE; WAIVER OF JURY TRIAL; CONSENT TO SERVICE OF PROCESS.

(a) THE TERMS OF SECTIONS 12.09 AND 12.16 OF THE INDENTURE WITH RESPECT TO GOVERNING LAW, SUBMISSION OF JURISDICTION, VENUE AND WAIVER OF JURY TRIAL ARE INCORPORATED HEREIN BY REFERENCE, MUTATIS MUTANDIS, AND THE PARTIES HERETO AGREE TO SUCH TERMS.

(b) EACH PARTY TO THIS COPYRIGHT SECURITY AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 6.01 OF THE SECURITY AGREEMENT. NOTHING IN THIS COPYRIGHT SECURITY AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS COPYRIGHT SECURITY AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

SECTION 6. Waivers; Amendments; Modifications. Neither this Copyright Security Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Collateral Agent and the Grantor or Grantors with respect to which such waiver, amendment or modification is to apply, subject to any consent required in accordance with Article 9 of the Indenture and subject to Section 6.02 of the Security Agreement.

SECTION 7. Notices; Communications. All communications and notices under this Copyright Security Agreement shall be in writing and given as provided in Section 6.01 of the Security Agreement.

SECTION 8. Counterparts; Effectiveness. This Copyright Security Agreement may be executed in any number of counterparts, all of which shall constitute one and the same instrument, and any party hereto may execute this Copyright Security Agreement by signing and delivering to the other party hereto one or more counterparts. Delivery by facsimile or other electronic communication of an executed counterpart (including portable document format (PDF)) of a signature page to this Copyright Security Agreement shall be effective as delivery of an original executed counterpart of this Copyright Security Agreement. This Copyright Security Agreement shall become effective as to the Grantor when a counterpart hereof executed on behalf of the Grantor shall have been delivered to the Collateral Agent and a counterpart hereof shall have been executed on behalf of the Collateral Agent, and thereafter shall be binding upon the Grantor and the Collateral Agent and their respective permitted successors and assigns, and shall inure to the benefit of the Grantor, the Collateral Agent and the other Secured Parties and their respective permitted successors and assigns, except that the Grantor shall not have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral (and any such assignment or transfer shall be void) except as expressly contemplated by the Security Agreement or the Indenture.

[Signature pages follow.]

 

-2-

[GRANTOR]

By:

  

 

  Name:
  Title:

 

-3-

WILMINGTON TRUST FSB, as Collateral Agent

By:

  

 

  Name:
  Title:

 

-4-

Schedule I

to

COPYRIGHT SECURITY AGREEMENT

UNITED STATES COPYRIGHT REGISTRATIONS

 

Table to Come      
EX-10.8 43 dex108.htm EXHIBIT 10.8 Exhibit 10.8

Exhibit 10.8

EXECUTION VERSION

SECURITY AGREEMENT

DATED 30 SEPTEMBER 2010

BETWEEN

THE CHARGORS

and

WILMINGTON TRUST FSB

as collateral agent

LOGO

Allen & Overy LLP

CONTENTS

 

Clause        Page  
1.   Interpretation      1   
2.   Creation of Security      3   
3.   Representations and warranties - general      6   
4.   Restrictions on dealings      7   
5.   Land      7   
6.   Investments      8   
7.   Restricted credit balances      12   
8.   Intellectual Property      13   
9.   Preservation of Security      13   
10.   When Security becomes enforceable      15   
11.   Enforcement of Security      16   
12.   Receiver      17   
13.   Powers of Receiver      18   
14.   Application of Proceeds      20   
15.   Currency Conversion      20   
16.   Expenses and Indemnity      20   
17.   Delegation      21   
18.   Further assurances      21   
19.   Power of attorney      21   
20.   Changes to the Parties      21   
21.   Intercreditor      22   
22.   Miscellaneous      22   
23.   Release      23   
24.   Evidence and calculations      23   
25.   Notices      23   
26.   Severability      23   
27.   Waivers and remedies cumulative      23   
28.   Counterparts      24   
29.   Governing Law      24   
30.   Enforcement      24   
Schedules   
1.   Chargors   
2.   Security Assets   
3.   Forms of letter for Account Bank   
Signatories      26   

THIS SECURITY AGREEMENT is dated 30 September 2010

BETWEEN:

 

(1) THE COMPANIES listed in Schedule 1 as chargors (each a Chargor);

 

(2) WILMINGTON TRUST FSB (the Collateral Agent) as agent for the Secured Parties (as defined below).

BACKGROUND:

 

(A) Each Chargor enters into this Security Agreement in connection with the Indenture (as defined below).

 

(B) It is intended that this document takes effect as a deed notwithstanding the fact that a party may only execute this document under hand.

IT IS AGREED as follows:

 

1. INTERPRETATION

 

1.1 Definitions

In this Deed:

Account Bank means, in relation to a Restricted Account, the bank with which the Restricted Account is maintained.

Act means the Law of Property Act 1925.

Credit Agreement means the US$1,600,000,000 credit agreement dated 27 July 2010 as amended and restated on 6 August 2010 and further amended and restated on 21 September 2010, and as further amended from time to time, between (among others) the Issuers and the Senior Collateral Agent.

Critical Transfer Restriction means, with respect to any rights under an agreement to which a Chargor is a party, a term in such agreement that (a) provides that the assignment or transfer thereof, or the creation, attachment, perfection, or enforcement of a security interest or encumbrance therein, may give rise to a default, breach, claim, defence, termination, right of termination under such agreement, and (b) is enforceable under the laws applicable thereto.

Indenture means the indenture dated on or about the date of this Security Agreement (as amended and restated from time to time) between (among others) Pinafore, Inc., a Delaware corporation, Pinafore, LLC, a Delaware limited liability company, (each as an issuer), Holdings, Wilmington Trust FSB as trustee and the Collateral Agent as collateral agent, in relation to the issue of certain 9% senior secured second lien notes due 1 October 2018, as may be supplemented, modified, amended and/or restated from time to time.

Indenture Party means, collectively, the Issuer and Note Guarantors.

Lien means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement).

 

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Party means a party to this Security Agreement.

Receiver means a receiver and manager or a receiver, in each case, appointed under this Security Agreement.

Restricted Account means any account of a Chargor and includes:

 

  (a) any account details which are set out in Schedule 2 (Security Assets);

 

  (b) if there is a change of Account Bank, any account into which all or part of a credit balance from a Restricted Account is transferred; and

 

  (c) any account which is a successor to a Restricted Account on any re-numbering or re-designation of accounts and any account into which all or part of a balance from a Restricted Account is transferred for investment or administrative purposes.

Second Lien Note Documents means, collectively, the Indenture, the Securities and the Second Lien Collateral Documents.

Secured Liabilities means the Second Lien Obligations.

Secured Parties means, collectively, any Holders, the Trustee and the Collateral Agent.

Security means any Lien created, evidenced or conferred by or under this Security Agreement.

Security Assets means all assets of each Chargor the subject of any security created by this Security Agreement.

Security Period means the period beginning on the date of this Security Agreement and ending on the date on which all the Secured Liabilities have been paid and discharged in full.

Senior Collateral has the meaning given to it in the Second Lien Intercreditor Agreement.

Senior Collateral Agent means Citicorp USA, Inc. as collateral agent under the Credit Agreement.

 

1.2 Construction

 

(a) Capitalised terms defined in the Indenture have, unless expressly defined in this Security Agreement, the same meaning in this Security Agreement.

 

(b) The provisions of section 1.02 (Other Definitions) to section 1.04 (Rules of Construction) of the Indenture apply to this Security Agreement as though they were set out in full in this Security Agreement, except that references to the Second Lien Note Documents will be construed as references to this Security Agreement.

 

(c) Notwithstanding anything in this Security Agreement to the contrary, no provision hereunder shall override the authority granted to the Collateral Agent in the Indenture to release or waive the security interest in respect of specific assets.

 

(d) A reference to a Second Lien Note Document or other document or security shall be construed (without prejudice to any prohibition on amendments) as a reference to that Second Lien Note Document or other document or security as amended, restated, supplemented, novated or otherwise modified from time to time, including any change in the purpose of, any extension or any increase in the amount of a facility or any additional facility or accession or retirement of the parties to these agreements.

 

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(e) Any covenant of a Chargor under this Deed (other than a payment obligation) remains in force during the Security Period and is given for the benefit of each Secured Party.

 

(f) The terms of the other Second Lien Note Documents and of any side letters between any Parties in relation to any Second Lien Note Document are incorporated in this Security Agreement to the extent required to ensure that any purported disposition of any freehold or leasehold property contained in this Security Agreement is a valid disposition in accordance with Section 2(1) of the Law of Property (Miscellaneous Provisions) Act 1989.

 

(g) If the Collateral Agent reasonably considers (acting in good faith and based on the advice of reputable third party counsel) that an amount paid to a Secured Party under a Second Lien Note Document is reasonably likely to be avoided or otherwise set aside on the liquidation or administration of the payer or otherwise, then that amount will not be considered to have been irrevocably paid for the purposes of this Security Agreement.

 

(h) Unless the context otherwise requires, a reference to a Security Asset includes:

 

  (i) any part of that Security Asset; and

 

  (ii) the proceeds of that Security Asset.

 

2. CREATION OF SECURITY

 

2.1 General

 

(a) All the security created under this Security Agreement:

 

  (i) is created in favour of the Collateral Agent;

 

  (ii) is created over present and future assets of each Chargor;

 

  (iii) is security for the payment, discharge and performance of all the Secured Liabilities; and

 

  (iv) is made with full title guarantee in accordance with the Law of Property (Miscellaneous Provisions) Act 1994.

 

(b) If the rights of a Chargor under a document cannot be secured without the consent of a party to that document:

 

  (i) this Security will secure all amounts which that Chargor may receive, or has received, after the date of this Security Agreement, under that document but exclude the document itself; and

 

  (ii) upon the request of the Collateral Agent, that Chargor must use reasonable endeavours to obtain the consent of the relevant party to that document being secured under this Security Agreement once an Event of Default has occurred and is continuing.

 

(c) The Collateral Agent holds the benefit of this Security Agreement on trust for the Secured Parties.

 

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(d) This Security Agreement shall not create a specific security interest over any assets owned by a Chargor on the date hereof or hereafter acquired that are subject to a Lien of the type described in paragraphs (6), (8) and (24) of the definition of Permitted Liens (to the extent relating to Liens originally incurred pursuant to paragraphs (6) and (8) of the definition of Permitted Liens) of the Indenture that is permitted to be incurred pursuant to the provisions of the Indenture, if and to the extent that the contract or other agreement pursuant to which such Lien is granted or to which such assets are subject (or the documentation relating thereto) prohibits the creation of such specific security interest on such asset.

 

2.2 Land

 

(a) Each Chargor charges:

 

  (i) by way of a first legal mortgage (ranking only after the Senior Collateral) all estates or interests in any Material Real Property now owned by it to the extent required by the provisions of Section 10.08 (Post-Closing Collateral) of the Indenture; this includes the real property (if any) specified in Schedule 2 (Security assets) under its name under the heading Material Real Property and/or which is designated in writing as Material Real Property by a Chargor; and

 

  (ii) (to the extent that they are not the subject of a mortgage under sub-paragraph (i) above) by way of first fixed charge (ranking only after the Senior Collateral) all estates or interests in any Material Real Property now owned by it.

 

(b) A reference in this Subclause to a mortgage or charge of any freehold or leasehold property includes:

 

  (i) all buildings, fixtures, fittings and fixed plant and machinery on that property; and

 

  (ii) the benefit of any covenants for title given or entered into by any predecessor in title of a Chargor in respect of that property or any moneys paid or payable in respect of those covenants but shall exclude any leasehold properties where the consent of a third party is required for such mortgage or charge unless and until such consent is obtained (and, prior to an Event of Default which is continuing, no Chargor shall be obliged to obtain or investigate the possibility of obtaining any such third party consent).

 

2.3 Investments

 

(a) Each Chargor charges by way of a first equitable mortgage (ranking only after the Senior Collateral) its interest in all shares, stocks, debentures, bonds or other securities and investments owned by it or held by any nominee on its behalf.

 

(b) A reference in this Subclause to a mortgage or charge of any stock, share, debenture, bond or other security includes:

 

  (i) any dividend, interest or other distribution paid or payable in relation to it;

 

  (ii) any right, money or property accruing or offered at any time in relation to it by way of redemption, substitution, exchange, bonus or preference, under option rights or otherwise;

 

  (iii) any right against any clearance system; and

 

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  (iv) any right under any custodian or other agreement.

 

2.4 Plant and machinery

Each Chargor charges by way of a first fixed charge (ranking only after the Senior Collateral) all plant and machinery owned by it and its interest in any plant or machinery in its possession.

 

2.5 Restricted credit balances

Each Chargor charges by way of first fixed charge (ranking only after the Senior Collateral) all of its rights in respect of any amount standing to the credit of any Restricted Account and the debt represented by it.

 

2.6 Insurances

Each Chargor assigns absolutely, subject to a proviso for re-assignment on redemption, all of its rights in respect of any contract or policy of insurance taken out by it or on its behalf or in which it has an interest.

 

2.7 Other contracts

Each Chargor assigns absolutely, subject to a proviso for re-assignment on redemption, all of its rights in respect of:

 

(a) any agreement to which it is a party except to the extent that it is subject to:

 

  (i) any fixed security created under any other term of this Clause; or

 

  (ii) any Critical Transfer Restriction;

 

(b) any letter of credit issued in its favour; and

 

(c) any bill of exchange or other negotiable instrument held by it.

 

2.8 Intellectual property

Each Chargor charges by way of a first fixed charge (ranking only after the Senior Collateral), all of its rights in respect of:

 

(a) any know-how, patent, trade mark, service mark, design, business name, topographical or similar right; this includes the patents and trademarks (if any) specified in Schedule 2 (Security Assets) under its name under the heading Specific Intellectual Property Rights;

 

(b) any copyright or other intellectual property monopoly right; or

 

(c) any interest (including by way of licence) in any of the above,

in each case whether registered or not and including all applications for the same.

 

2.9 Miscellaneous

Each Chargor charges by way of first fixed charge (ranking only after the Senior Collateral):

 

(a) any beneficial interest, claim or entitlement it has in any pension fund;

 

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(b) its goodwill;

 

(c) the benefit of any authorization (statutory or otherwise) held in connection with its use of any Security Asset;

 

(d) the right to recover and receive compensation which may be payable to it in respect of any authorization referred to in paragraph (c) above; and

 

(e) its uncalled capital.

 

2.10 Floating charge

 

(a) Each Chargor charges by way of a first floating charge (ranking only after the Senior Collateral) all its assets not at any time otherwise effectively mortgaged, charged or assigned by way of fixed mortgage, charge or assignment under this Clause.

 

(b) Except as provided below, the Collateral Agent may by notice to a Chargor convert the floating charge created by that Chargor under this Subclause into a fixed charge as regards any of that Chargor’s assets specified in that notice, if:

 

  (i) an Event of Default is outstanding; or

 

  (ii) the Collateral Agent reasonably considers those assets to be in danger of being seized or sold under any form of distress, attachment, execution or other legal process or to be otherwise in jeopardy.

 

(c) The floating charge created by this Subclause may not be converted into a fixed charge solely by reason of:

 

  (i) the obtaining of a moratorium; or

 

  (ii) anything done with a view to obtaining a moratorium,

under section 1A of the Insolvency Act 1986.

 

(d) The floating charge created by this Subclause will automatically convert into a fixed charge over all of a Chargor’s assets if an administrator is appointed or the Collateral Agent receives notice of an intention to appoint an administrator.

 

(e) The floating charge created by this Subclause is a qualifying floating charge for the purpose of paragraph 14 of Schedule B1 to the Insolvency Act 1986.

 

3. REPRESENTATIONS AND WARRANTIES - GENERAL

 

3.1 Representations and warranties

Each Chargor makes the representations and warranties as set out in this Security Agreement to each Secured Party.

 

3.2 Times for making representations and warranties

 

(a) The representations and warranties set out in this Security Agreement are made on the date of this Security Agreement.

 

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(b) Each representation and warranty under this Security Agreement is deemed to be repeated by each Chargor on the last Business Day of each calendar quarter.

 

(c) When a representation and warranty is repeated, it is applied to the circumstances existing at the time of repetition.

 

4. RESTRICTIONS ON DEALINGS

No Chargor may:

 

(a) create or permit to subsist any Lien on any Security Asset; or

 

(b) sell, transfer, licence, lease or otherwise dispose of any Security Asset,

except as not prohibited under the Indenture.

 

5. LAND

 

5.1 Notices

Each Chargor must, within 14 days after the receipt by it of any application, requirement, order or notice served or given by any public or local or any other authority with respect to any Material Real Property (or any part of it):

 

(a) deliver a copy to the Collateral Agent; and

 

(b) inform the Collateral Agent of the steps taken or proposed to be taken to comply with the relevant requirements, if and to the extent that failure to take any action could reasonably be expected to have a Material Adverse Effect.

 

5.2 H.M. Land Registry

Each Chargor consents to a restriction in the following terms being entered into on the Register of Title relating to any Material Real Property registered at H.M. Land Registry:

“No disposition of the registered estate by the proprietor of the registered estate is to be registered without a written consent signed by the proprietor for the time being of the security agreement dated [—] September 2010 in favour of Wilmington Trust FSB, as Collateral Agent, referred to in the charges register or their conveyancer. (Standard Form P)”

 

5.3 Deposit of title deeds

Each Chargor must deposit (if so requested) with the Collateral Agent all deeds and documents of title relating to its Material Real Property and all local land charges, land charges and Land Registry search certificates and similar documents received by it or on its behalf.

 

5.4 Power to remedy

If a Chargor fails to perform any term affecting its Material Real Property upon the occurrence and during the continuance of an Event of Default and upon notice by the Collateral Agent of its intent to exercise remedies, that Chargor must allow the Collateral Agent or its agents and contractors:

 

(a) to enter any part of its Material Real Property;

 

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(b) to comply with or object to any notice served on that Chargor in respect of its Material Real Property; and

 

(c) to take any action as the Collateral Agent may reasonably consider necessary to prevent or remedy any breach of any such term or to comply with or object to any such notice.

That Chargor must promptly following request by the Collateral Agent pay the costs and expenses of the Collateral Agent or its agents and contractors reasonably incurred in connection with any action taken by it under this Subclause.

 

6. INVESTMENTS

 

6.1 General

In this Clause:

Investments means:

 

  (a) all shares, stocks, debentures, bonds or other securities and investments included in the definition of Security Assets in Clause 1.1 (Definitions);

 

  (b) any dividend, interest or other distribution paid or payable in relation to any of the above;

 

  (c) any right, money or property accruing or offered at any time in relation to any of the above by way of redemption, substitution, exchange, bonus or preference under option rights or otherwise;

 

  (d) any right against any clearance system in relation to any of the above; and

 

  (e) any right under any custodian or other agreement in relation to any of the above.

 

6.2 Investments

Each Chargor represents to each Secured Party that:

 

(a) to the extent applicable, its Investments, are duly authorised, validly issued and fully paid and are not subject to any option to purchase or similar right;

 

(b) it is the sole legal and beneficial owner of its Investments; and

 

(c) subject to any Liens expressly permitted under the Indenture, the Investments are free and clear of all Liens.

 

6.3 Deposit

Subject to section 5.05 (Gratuitous Bailee for Perfection) of the Second Lien Intercreditor Agreement, each Chargor must:

 

  (a) promptly deposit with the Collateral Agent, or as the Collateral Agent may reasonably direct, all certificates and other documents of title or evidence of ownership in relation to any of its Investments;

 

  (b)

promptly deliver to the Collateral Agent executed and (unless exempt from stamp duty), pre-stamped share transfers and other documents in respect of any of its

 

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Investments in favour of the Collateral Agent or any of its nominees as transferee or, if the Collateral Agent so directs, with the transferee left blank (and the Collateral Agent shall not take any action in relation to the documents delivered under this paragraph (b) if as a result thereof transfer of legal title would occur unless at such time an Event of Default has occurred and is continuing); and

 

  (c) promptly take any action and execute and deliver to the Collateral Agent all share transfers and other documents which may be requested by the Collateral Agent in order to enable the Collateral Agent or its nominees to be registered as the owner or otherwise obtain a legal title to any of its Investments; this includes procuring that those share transfers and other documents are registered by the company in which, to the extent applicable, its Investments are held and that share certificates and other documents in the name of the transferee are delivered to the Collateral Agent provided that the relevant Chargor shall not be required to take any such action under this paragraph (c) (and the Collateral Agent shall not take any such action) if as a result thereof transfer of legal title would occur unless at such time an Event of Default has occurred and is continuing.

 

6.4 Changes to rights

No Chargor must take or (so far as is within its control) allow the taking of any action on its behalf which results either (a) in the rights attaching to any Investments being altered in a way which could reasonably be expected to materially and adversely affect the interests of the Secured Parties; or (b) further shares being issued save where such shares will be subject to security in favour of the Collateral Agent on substantially the same terms as set out herein unless otherwise permitted by the Indenture.

 

6.5 Transfer

Each Chargor must ensure that the articles of association of the company in which, to the extent applicable, its Investments are held do not contain any restriction on, or requirement for any consent to, any transfer of the Investments as contemplated by, or upon enforcement of, this Security.

 

6.6 Calls

 

(a) Each Chargor must pay all calls and other payments due and payable in respect of any Investments save where failure to do so would not reasonably be expected to have a material adverse effect on the Investments or a Material Adverse Effect.

 

(b) If a Chargor fails to do so, the Collateral Agent may pay any such calls or other payments on behalf of that Chargor. That Chargor must promptly following demand reimburse the Collateral Agent for any payment made by the Collateral Agent under this Subclause and, pending reimbursement, that payment will constitute part of the Secured Liabilities.

 

6.7 Other obligations in respect of Investments

 

(a) Each Chargor must comply with all requests for information which is within its knowledge and which are made under any law or regulation or by any listing or other authority or any similar provision contained in any constitutional document relating to any of its Investments save where failure to do so would not reasonably be expected to have a material adverse effect on the Investments or a Material Adverse Effect. If it fails to do so, the Collateral Agent may elect to provide such information as it may have on behalf of that Chargor.

 

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(b) Each Chargor must promptly supply to the Collateral Agent a copy of any material information referred to in sub-paragraph (a) above.

 

(c) Each Chargor must comply with all other conditions and obligations assumed by it in respect of any of its Investments save where failure to do so would not reasonably be expected to have a material adverse effect on the Investments or a Material Adverse Effect.

 

(d) No Secured Party is obliged to:

 

  (i) perform or fulfil any obligation of a Chargor;

 

  (ii) make any payment;

 

  (iii) make any enquiry as to the nature or sufficiency of any payment received by it or a Chargor; or

 

  (iv) present or file any claim or take any other action to collect or enforce the payment of any amount to which it may be entitled under this Security Agreement,

in respect of any Investment.

 

6.8 Voting rights

 

(a) Before this Security becomes enforceable, each Chargor may continue to exercise the voting rights, powers and other rights in respect of the Investments, provided that no Chargor may exercise its voting rights in a way that would be in violation of any terms of this Security Agreement, the Indenture or any other Second Lien Note Document or would have a material adverse effect on the Investments.

 

(b) Before this Security becomes enforceable, if any Investments have been registered in the name of the Collateral Agent or its nominee, the Collateral Agent (or its nominee) must exercise the voting rights, powers and other rights in respect of the Investments in the manner in which the relevant Chargor may direct in writing, provided that the relevant Chargor may not direct the Collateral Agent to exercise such voting rights, powers and other rights in a way that would be in violation of any terms of this Security Agreement, the Indenture or any other Second Lien Note Document or would have a material adverse effect on the Investments. The Collateral Agent (or that nominee) will execute any form of proxy or other document which a Chargor may reasonably require for this purpose.

 

(c) Before this Security becomes enforceable, all dividends or other income or distributions paid or payable in relation to any Investments and permitted under the Indenture must be paid to the relevant Chargor. To achieve this (if any Investments have been registered in the name of the Collateral Agent or its nominee):

 

  (i) the Collateral Agent or its nominee, at the written request and expense of the relevant Chargor, must promptly execute any dividend mandate necessary to ensure that payment is made direct to the relevant Chargor; or

 

  (ii) if payment is made directly to the Collateral Agent (or its nominee) before this Security becomes enforceable, the Collateral Agent (or that nominee), at the written request and expense of the relevant Chargor, must promptly pay that amount to the relevant Chargor,

to the extent that such payment is permitted under the Indenture.

 

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(d) Before this Security becomes enforceable (if any Investments have been registered in the name of the Collateral Agent or its nominee), the Collateral Agent must use its reasonable endeavours to forward to the relevant Chargor all material notices, correspondence and/or other communication it receives in relation to the Investments.

 

(e) After this Security has become enforceable, the Collateral Agent or its nominee may exercise or refrain from exercising:

 

  (i) any voting rights; and

 

  (ii) any other powers or rights which may be exercised by the legal or beneficial owner of any Investments, any person who is the holder of any Investments or otherwise,

in each case, in the name of the relevant Chargor, the registered holder or otherwise and without any further consent or authority on the part of that Chargor and irrespective of any direction given by that Chargor. The Collateral Agent and any nominee shall however promptly inform that Chargor of any action taken under this Subclause.

 

(f) To the extent that any Investment remains registered in the name of a Chargor, that Chargor irrevocably appoints the Collateral Agent or its nominee as its proxy to exercise all voting rights in respect of those Investments at any time after this Security has become enforceable.

 

(g) Each Chargor must indemnify the Collateral Agent against any loss or liability incurred by the Collateral Agent as a consequence of the Collateral Agent acting in respect of the Investments at the direction of that Chargor save for any such loss or liability which has been caused by the gross negligence or wilful misconduct of the Collateral Agent or otherwise in breach of any Applicable Law or regulation.

 

6.9 Clearance systems

 

(a) Each Chargor must, if so requested by the Collateral Agent after the occurrence of an Event of Default:

 

  (i) instruct any clearance system to transfer any Investments held by it for that Chargor or its nominee to an account of the Collateral Agent or its nominee with that clearance system; and

 

  (ii) take whatever action the Collateral Agent may request for the dematerialisation or rematerialisation of any shares held in a clearance system.

 

(b) Without prejudice to the rest of this Subclause the Collateral Agent may, at the expense of the relevant Chargor (provided that such expenses are reasonably incurred), take whatever action is reasonably required for the dematerialisation or rematerialisation of the shares as necessary.

 

6.10 Custodian arrangements

Each Chargor must:

 

  (a) promptly give notice of this Security Agreement to any custodian of, to the extent applicable, any of its Investments; and

 

  (b) use reasonable endeavours to ensure that the custodian acknowledges that notice.

 

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6.11 Financial Collateral

 

(a) To the extent that the assets mortgaged or charged under this Security Agreement constitute “financial collateral” and this Security Agreement and the obligations of a Chargor under this Security Agreement constitute a “security financial collateral arrangement” (in each case for the purpose of and as defined in the Financial Collateral Arrangements (No. 2) Regulations 2003 (SI 2003 No. 3226)) the Collateral Agent will have the right after this Security has become enforceable to appropriate all or any part of that financial collateral in or towards the satisfaction of the Secured Liabilities.

 

(b) Where any financial collateral is appropriated:

 

  (i) if the financial collateral is listed or traded on a recognised exchange its value will be taken as the value at which it could have been sold on the exchange on the date of appropriation; or

 

  (ii) in any other case, the value of the financial collateral will be such amount as the Collateral Agent reasonably determines, acting in good faith and in consultation with the relevant Chargor, having taken into account advice obtained by it from an independent investment or accountancy firm of national standing selected by it;

and each Secured Party will give credit for the proportion of the value of the financial collateral appropriated to its use.

 

7. RESTRICTED CREDIT BALANCES

 

7.1 Representations

Each Chargor represents to each Secured Party that:

 

(a) it is the sole legal and beneficial owner of the credit balance from time to time in each Restricted Account which it maintains; and

 

(b) subject to any Liens expressly permitted under the Indenture, the credit balances are free and clear of all Liens and any other rights or interests in favour of third parties.

 

7.2 Withdrawals

Before this Security becomes enforceable, each Chargor may withdraw any moneys (including interest) standing to the credit of any Restricted Account without the prior consent of the Collateral Agent.

 

7.3 Change of Account Banks

 

(a) The Account Bank may be changed to another bank or financial institution.

 

(b) Following a change of Account Bank, the relevant Chargor shall promptly deliver a notice substantially in the form set out in Schedule 3 (Forms of letter for Account Bank).

 

7.4 Notices of charge

Each Chargor must:

 

(a) promptly serve a notice of charge, substantially in the form of Part 1 of Schedule 3 (Forms of letter for Account Bank) on each Account Bank; and

 

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(b) use its reasonable endeavours to ensure that each Account Bank acknowledges the notice, substantially in the form of Part 2 of Schedule 3 (Forms of letter for Account Bank), provided that such obligation shall cease if such acknowledgement has not been delivered within 20 Business Days of the giving of the notice referred to in paragraph (a) above.

 

8. INTELLECTUAL PROPERTY

 

8.1 General

In this Clause Intellectual Property Rights means:

 

(a) any know-how, patent, trade mark, service mark, design, business name, topographical or similar right;

 

(b) any copyright or other intellectual property monopoly right;

 

(c) any interest (including by way of licence) in any of the above; or

 

(d) any application for any of the above,

in each case, whether registered or not, and included in the definition of Security Assets in Clause 1.1 (Definitions).

 

8.2 Preservation

Each Chargor must:

 

  (i) make such registrations and pay such fees, registration taxes and similar amounts as are necessary to keep its Intellectual Property Rights in force;

 

  (ii) take all other steps which are reasonably practicable to maintain and preserve its interests in its Intellectual Property Rights;

 

  (iii) make entries in any public register of its Intellectual Property Rights which either record the existence of this Security Agreement or the restrictions on disposal imposed by this Security Agreement; and

 

  (iv) take such steps as are necessary (including the institution of legal proceedings) to prevent third parties infringing those Intellectual Property Rights,

save where failure to take any such action could not reasonably be expected to have a Material Adverse Effect.

 

9. PRESERVATION OF SECURITY

 

9.1 Continuing security

This Security is a continuing security and will extend to the ultimate balance of the Secured Liabilities, regardless of any intermediate payment or discharge in whole or in part.

 

9.2 Reinstatement

 

(a)

If any discharge (whether in respect of the obligations of any Loan Party or any security for those obligations or otherwise) or arrangement is made in whole or in part on the faith of any payment, security or other disposition which is avoided or must be restored on insolvency,

 

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liquidation, administration or otherwise without limitation, the liability of each Chargor under this Security Agreement will continue or be reinstated as if the discharge or arrangement had not occurred.

 

(b) Each Secured Party may concede or compromise any claim that any payment, security or other disposition is liable to avoidance or restoration.

 

9.3 Waiver of defences

The obligations of a Chargor under this Security Agreement will not be affected by any act, omission or thing (whether or not known to it or any Secured Party) which, but for this provision, would reduce, release or prejudice any of its obligations under this Security Agreement. This includes:

 

  (a) any time or waiver granted to, or composition with, any person;

 

  (b) any release of any person under the terms of any composition or arrangement;

 

  (c) the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect, take up or enforce, any rights against, or security over assets of, any person;

 

  (d) any non-presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security;

 

  (e) any incapacity, lack of power, authority or legal personality of or dissolution or change in the members or status of any person;

 

  (f) any amendment of a Second Lien Note Document or any other document or security; or

 

  (g) any unenforceability, illegality, invalidity or non-provability of any obligation of any person under any Second Lien Note Document or any other document or security or the failure by that Chargor or any of its Subsidiaries to enter into or be bound by any Second Lien Note Document.

 

9.4 Immediate recourse

Each Chargor waives any right it may have of first requiring any Secured Party (or any trustee or agent on its behalf) to proceed against or enforce any other right or security or claim payment from any person or file any proof or claim in any insolvency, administration, winding-up or liquidation proceedings relative to any other Indenture Party or any other person before claiming from that Chargor under this Security Agreement.

 

9.5 Appropriations

At any time during the Security Period, each Secured Party (or any trustee or agent on its behalf) may without affecting the liability of a Chargor under this Security Agreement:

 

  (a) (i) refrain from applying or enforcing any other moneys, security or rights held or received by that Secured Party (or any trustee or agent on its behalf) against those amounts; or

 

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  (ii) apply and enforce them in such manner and order as it sees fit (whether against those amounts or otherwise); and

 

  (b) hold in a non interest-bearing suspense account any moneys received from a Chargor or on account of a Chargor’s liability under this Security Agreement.

 

9.6 Non-competition

Unless the Security Period has expired, no Chargor will, after a claim has been made under this Security Agreement or by virtue of any payment or performance by it under this Security Agreement:

 

  (a) be subrogated to any rights, security or moneys held, received or receivable by any Secured Party (or any trustee or agent on its behalf);

 

  (b) be entitled to any right of contribution or indemnity in respect of any payment made or moneys received on account of a Chargor’s liability under this Clause;

 

  (c) claim, rank, prove or vote as a creditor of any Indenture Party or its estate in competition with any Secured Party (or any trustee or agent on its behalf); or

 

  (d) receive, claim or have the benefit of any payment, distribution or security from or on account of any Indenture Party, or exercise any right of set-off as against any Indenture Party.

Each Chargor must hold in trust for and immediately pay or transfer to the Collateral Agent for the Secured Parties any payment or distribution or benefit of security received by it contrary to this Clause or in accordance with any directions given by the Collateral Agent under this Clause.

 

9.7 Additional security

 

(a) This Security Agreement is in addition to and is not in any way prejudiced by any other security now or subsequently held by any Secured Party.

 

(b) No prior security held by any Secured Party (in its capacity as such or otherwise) over any Security Asset will merge into this Security.

 

9.8 Security held by the Chargors

No Chargor may hold any security from any other Indenture Party in respect of that Chargor’s liability under this Security Agreement. That Chargor will hold any security held by it in breach of this provision on trust for the Collateral Agent.

 

10. WHEN SECURITY BECOMES ENFORCEABLE

 

10.1 Timing

This Security will become immediately enforceable upon the occurrence and during the continuance of an Event of Default.

 

10.2 Enforcement

After this Security has become enforceable, the Collateral Agent may in its absolute discretion enforce all or any part of this Security in any manner it sees fit.

 

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11. ENFORCEMENT OF SECURITY

 

11.1 General

 

(a) The power of sale and any other powers conferred on a mortgagee by law (including under Section 101 of the Act), as amended by this Security Agreement, will be immediately exercisable at any time after this Security has become enforceable.

 

(b) For the purposes of all powers implied by statute, the Secured Liabilities are deemed to have become due and payable on the date of this Security Agreement.

 

(c) Any restriction imposed by law on the power of sale (including under section 103 of the Act) or the right of a mortgagee to consolidate mortgages (including under section 93 of the Act) does not apply to this Security.

 

(d) The statutory powers of leasing conferred on the Collateral Agent are extended so as to authorise the Collateral Agent to lease, make agreements for leases, accept surrenders of leases and grant options as the Collateral Agent may think fit and without the need to comply with any provision of section 99 or 100 of the Act.

 

11.2 No liability as mortgagee in possession

Neither the Collateral Agent nor any Receiver will be liable, by reason of entering into possession of a Security Asset, to account as mortgagee in possession or for any loss on realisation or for any default or omission for which a mortgagee in possession might be liable.

 

11.3 Privileges

Each Receiver and the Collateral Agent is entitled to all the rights, powers, privileges and immunities conferred by law (including the Act) on mortgagees and receivers duly appointed under any law (including the Act), except that Section 103 of the Act does not apply.

 

11.4 Protection of third parties

No person (including a purchaser) dealing with the Collateral Agent or a Receiver or its or his agents will be concerned to enquire:

 

(a) whether the Secured Liabilities have become payable;

 

(b) whether any power which the Collateral Agent or a Receiver is purporting to exercise has become exercisable or is being properly exercised;

 

(c) whether any money remains due under the Second Lien Note Documents; or

 

(d) how any money paid to the Collateral Agent or to that Receiver is to be applied.

 

11.5 Redemption of prior mortgages

 

(a) At any time after this Security has become enforceable, the Collateral Agent may:

 

  (i) redeem any prior Lien against any Security Asset; and/or

 

  (ii) procure the transfer of that Lien to itself; and/or

 

16

  (iii) settle and pass the accounts of the prior mortgagee, chargee or encumbrancer; any accounts so settled and passed will be, in the absence of manifest error, conclusive and binding on each Chargor.

 

(b) Each Chargor must pay to the Collateral Agent, promptly following demand, the costs and expenses incurred by the Collateral Agent in connection with any such redemption and/or transfer, including the payment of any principal or interest.

 

11.6 Contingencies

If this Security is enforced at a time when no amount is due under the Second Lien Note Documents but at a time when amounts may or will become due, the Collateral Agent (or the Receiver) may pay the proceeds of any recoveries effected by it into such number of suspense accounts as it considers appropriate.

 

12. RECEIVER

 

12.1 Appointment of Receiver

 

(a) Except as provided below, the Collateral Agent may appoint any one or more persons to be a Receiver of all or any part of the Security Assets if:

 

  (i) this Security has become enforceable; or

 

  (ii) a Chargor so requests the Collateral Agent in writing at any time.

 

(b) Any appointment under paragraph (a) above may be by deed, under seal or in writing under its hand.

 

(c) Except as provided below, any restriction imposed by law on the right of a mortgagee to appoint a Receiver (including under section 109(1) of the Act) does not apply to this Security Agreement.

 

(d) The Collateral Agent is not entitled to appoint a Receiver solely as a result of the obtaining of a moratorium (or anything done with a view to obtaining a moratorium) under section 1A of the Insolvency Act 1986.

 

12.2 Removal

The Collateral Agent may by writing under its hand remove any Receiver appointed by it and may, whenever it thinks fit, appoint a new Receiver in the place of any Receiver whose appointment may for any reason have terminated.

 

12.3 Remuneration

The Collateral Agent may fix the remuneration of any Receiver appointed by it and the maximum rate specified in Section 109(6) of the Act will not apply.

 

12.4 Agent of each Chargor

 

(a) A Receiver will be deemed to be the agent of each Chargor for all purposes and accordingly will be deemed to be in the same position as a Receiver duly appointed by a mortgagee under the Act. Each Chargor is responsible for the contracts, engagements, acts, omissions, defaults and losses of a Receiver and for liabilities incurred by a Receiver.

 

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(b) No Secured Party will incur any liability (either to a Chargor or to any other person) by reason of the appointment of a Receiver or for any other reason.

 

12.5 Relationship with Collateral Agent

To the fullest extent allowed by law, any right, power or discretion conferred by this Security Agreement (either expressly or impliedly) or by law on a Receiver may after this Security becomes enforceable be exercised by the Collateral Agent in relation to any Security Asset without first appointing a Receiver and notwithstanding the appointment of a Receiver.

 

13. POWERS OF RECEIVER

 

13.1 General

 

(a) A Receiver has all of the rights, powers and discretions set out below in this Clause in addition to those conferred on it by any law. This includes all the rights, powers and discretions conferred on a receiver (or a receiver and manager) under the Act and the Insolvency Act, 1986.

 

(b) If there is more than one Receiver holding office at the same time, each Receiver may (unless the document appointing him states otherwise) exercise all of the powers conferred on a Receiver under this Security Agreement individually and to the exclusion of any other Receiver.

 

13.2 Possession

A Receiver may take immediate possession of, get in and collect any Security Asset.

 

13.3 Carry on business

A Receiver may carry on any business of any Chargor in any manner he thinks fit.

 

13.4 Employees

 

(a) A Receiver may appoint and discharge managers, officers, agents, accountants, servants, workmen and others for the purposes of this Security Agreement upon such terms as to remuneration or otherwise as he thinks fit.

 

(b) A Receiver may discharge any person appointed by any Chargor.

 

13.5 Borrow money

A Receiver may raise and borrow money either unsecured or on the security of any Security Asset either in priority to this Security or otherwise and generally on any terms and for whatever purpose which he thinks fit.

 

13.6 Sale of assets

 

(a) A Receiver may sell, exchange, convert into money and realise any Security Asset by public auction or private contract and generally in any manner and on any terms which he thinks fit.

 

(b) The consideration for any such transaction may consist of cash, debentures or other obligations, shares, stock or other valuable consideration and any such consideration may be payable in a lump sum or by instalments spread over any period which he thinks fit.

 

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(c) Fixtures, other than landlord’s fixtures, may be severed and sold separately from the property containing them without the consent of the relevant Chargor.

 

13.7 Leases

A Receiver may let any Security Asset for any term and at any rent (with or without a premium) which he thinks fit and may accept a surrender of any lease or tenancy of any Security Asset on any terms which he thinks fit (including the payment of money to a lessee or tenant on a surrender).

 

13.8 Compromise

A Receiver may settle, adjust, refer to arbitration, compromise and arrange any claim, account, dispute, question or demand with or by any person who is or claims to be a creditor of any Chargor or relating in any way to any Security Asset.

 

13.9 Legal actions

A Receiver may bring, prosecute, enforce, defend and abandon any action, suit or proceedings in relation to any Security Asset which he thinks fit.

 

13.10 Receipts

A Receiver may give a valid receipt for any moneys and execute any assurance or thing which may be proper or desirable for realising any Security Asset.

 

13.11 Subsidiaries

A Receiver may form a Subsidiary of any Chargor and transfer to that Subsidiary any Security Asset.

 

13.12 Delegation

A Receiver may delegate his powers in accordance with this Security Agreement.

 

13.13 Lending

A Receiver may lend money or advance credit to any customer of any Chargor.

 

13.14 Protection of assets

A Receiver may:

 

(a) effect any repair or insurance and do any other act which any Chargor might do in the ordinary conduct of its business to protect or improve any Security Asset;

 

(b) commence and/or complete any building operation; and

 

(c) apply for and maintain any planning permission, building regulation approval or any other authorisation,

in each case as he thinks fit.

 

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13.15 Other powers

A Receiver may:

 

(a) do all other acts and things which he may consider desirable or necessary for realising any Security Asset or incidental or conducive to any of the rights, powers or discretions conferred on a Receiver under or by virtue of this Security Agreement or law;

 

(b) exercise in relation to any Security Asset all the powers, authorities and things which he would be capable of exercising if he were the absolute beneficial owner of that Security Asset; and

 

(c) use the name of any Chargor for any of the above purposes.

 

14. APPLICATION OF PROCEEDS

Any moneys received by the Collateral Agent or that Receiver after this Security has become enforceable must be applied by the Collateral Agent in the following order of priority:

 

  (a) in or towards payment of or provision for all costs and expenses incurred by the Collateral Agent or any Receiver under or in connection with this Security Agreement and of all remuneration due to any Receiver under or in connection with this Security Agreement;

 

  (b) in payment to the Trustee for application towards the balance of the Secured Liabilities; and

 

  (c) in payment of the surplus (if any) to any Chargor or other person entitled to it.

Notwithstanding the foregoing, this Clause is subject to the payment of any claims having priority over this Security and to the terms of the Second Lien Intercreditor Agreement. This Clause does not prejudice the right of any Secured Party to recover any shortfall from any Chargor following compliance with the terms of the Second Lien Intercreditor Agreement.

 

15. CURRENCY CONVERSION

Any amounts received by the Collateral Agent or the Secured Parties as a consequence of the exercise of the Collateral Agent’s rights provided for herein, including in respect of an Event of Default, shall be applied pursuant to the terms of the Second Lien Intercreditor Agreement. Where applicable, such amounts will be converted into U.S. Dollars at the reasonable market rates in force on the day of such conversion and then remitted (minus any commission or other amounts charged in connection with such conversion, if applicable) to the Collateral Agent for the benefit of the Secured Parties or directly to the Secured Parties, provided that if such conversion or remittance is not legally permitted or possible for any reason outside the Collateral Agent’s control at the time, such amounts may, at the sole discretion of the Collateral Agent or the Secured Parties, and if so permitted under applicable law, regulations and the terms of the Second Lien Intercreditor Agreement, be received in the applicable currency by the Collateral Agent or the Secured Parties.

 

16. EXPENSES AND INDEMNITY

 

(a) Each Chargor must:

 

  (i) immediately on demand pay all costs and expenses (including legal fees) incurred in connection with this Security Agreement by any Secured Party, Receiver, attorney, manager, agent or other person appointed by the Collateral Agent under this Security Agreement including any arising from any actual or alleged breach by any person of any law or regulation, whether relating to the environment or otherwise; and

 

20

  (ii) keep each of those persons indemnified against any failure or delay in paying those costs and expenses.

 

(b) No Chargor will be liable for any amount claimed under and in accordance with paragraph (a) above to the extent that such an amount has arisen solely due to the gross negligence or wilful misconduct of any Secured Party, Receiver, attorney, manager, agent or other person appointed by the Collateral Agent under this Security Agreement.

 

17. DELEGATION

 

17.1 Power of Attorney

The Collateral Agent or any Receiver may delegate by power of attorney or in any other manner to any person any right, power or discretion exercisable by it under this Security Agreement.

 

17.2 Terms

Any such delegation may be made upon any terms (including power to sub-delegate) which the Collateral Agent or any Receiver may think fit.

 

17.3 Liability

Neither the Collateral Agent nor any Receiver will be in any way liable or responsible to any Chargor for any loss or liability arising from any act, default, omission or misconduct on the part of any delegate or sub-delegate.

 

18. FURTHER ASSURANCES

Each Chargor must comply with its further assurance obligations in section 4.15 (Further Assurances) of the Indenture.

 

19. POWER OF ATTORNEY

Each Chargor, by way of security, irrevocably and severally appoints the Collateral Agent, each Receiver and any of their delegates or sub-delegates to be its attorney to take any action which that Chargor is obliged to take under this Security Agreement but which it has not taken within the timeframe permitted by this Security Agreement. Each Chargor ratifies and confirms whatever any attorney does or purports to do under its appointment under this Clause.

 

20. CHANGES TO THE PARTIES

 

20.1 The Chargors

No Chargor may assign or transfer any of its rights or obligations under this Security Agreement other than in connection with the transfer of shares to a Note Guarantor as contemplated by the Company Reorganization (as defined in the Credit Agreement), provided that such transfer is expressly subject to this Security and the transferee agrees to be bound by the terms of this Security Agreement.

 

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20.2 The Secured Parties

 

(a) Any Secured Party may assign or otherwise dispose of all or any of its rights under this Security Agreement in accordance with the terms of the Second Lien Note Documents to which it is a party and may disclose any information in its possession relating to a Chargor to any actual or prospective assignee, transferee or participant if so permitted by the terms of the Second Lien Note Documents.

 

(b) References to the Collateral Agent in this Security Agreement include any successor Collateral Agent appointed under the Credit Agreement.

 

21. INTERCREDITOR

 

(a) Notwithstanding anything to the contrary herein, the Security and the exercise by the Collateral Agent of any right or remedy under this Security Agreement are subject to the provisions of the Second Lien Intercreditor Agreement.

 

(b) In the event of any conflict between the terms of Second Lien Intercreditor Agreement and this Security Agreement, the terms of the Second Lien Intercreditor Agreement shall prevail.

 

22. MISCELLANEOUS

 

22.1 Covenant to pay

Each Chargor must pay or discharge the Secured Liabilities in the manner provided for in the Second Lien Note Documents.

 

22.2 Tacking

Each Issuer must perform its obligations under the Indenture (including any obligation to make available further Securities).

 

22.3 New Accounts

 

(a) If any subsequent charge or other interest affects any Security Asset, the Secured Party may open a new account with a Chargor.

 

(b) If the Secured Party does not open a new account, it will nevertheless be treated as if it had done so at the time when it received or was deemed to have received notice of that charge or other interest.

 

(c) As from that time all payments made to the Secured Party will be credited or be treated as having been credited to the new account and will not operate to reduce any Secured Liability.

 

22.4 Time deposits

Without prejudice to any right of set-off any Secured Party may have under any other Second Lien Note Document or otherwise, if any time deposit matures on any account a Chargor has with any Secured Party within the Security Period when:

 

(a) this Security has become enforceable; and

 

22

(b) no Secured Liability is due and payable,

that time deposit will automatically be renewed for any further maturity which that Secured Party considers appropriate.

 

23. RELEASE

At the end of the Security Period, the Secured Parties must, at the request and cost of a Chargor, take whatever action is necessary to release its Security Assets from this Security. In addition, if any Security Asset is being disposed of or otherwise transferred to a person other than the Issuers or any Note Guarantor pursuant to a transaction which is either permitted by or consented to under the Indenture, the Collateral Agent shall, at the reasonable request and cost of the relevant Chargor, release, reassign or discharge (as appropriate) such Security Asset from this Security.

 

24. EVIDENCE AND CALCULATIONS

 

24.1 Accounts

Accounts maintained by a Secured Party in connection with this Security Agreement are prima facie evidence of the matters to which they relate for the purpose of any litigation or arbitration proceedings.

 

24.2 Certificates and determinations

Any certification or determination by a Secured Party of a rate or amount under the Indenture will be, in the absence of manifest error, conclusive evidence of the matters to which it relates.

 

24.3 Calculations

Any interest or fee accruing under this Security Agreement accrues from day to day and is calculated as set out under section 1(a) (Interest) of the form of the reverse side of the Initial Security under Exhibit A of the Indenture.

 

25. NOTICES

Any communication in connection with this Security Agreement must be given in accordance with the terms of the Indenture.

 

26. SEVERABILITY

If a term of this Security Agreement is or becomes illegal, invalid or unenforceable in any respect under any jurisdiction, that will not affect:

 

  (a) the legality, validity or enforceability in that jurisdiction of any other term of this Security Agreement; or

 

  (b) the legality, validity or enforceability in any other jurisdiction of that or any other term of this Security Agreement.

 

27. WAIVERS AND REMEDIES CUMULATIVE

The rights of each Secured Party under this Security Agreement:

 

  (a) may be exercised as often as necessary;

 

23

  (b) are cumulative and not exclusive of its rights under the general law; and

 

  (c) may be waived only in writing and specifically.

Delay in exercising or non-exercise of any right is not a waiver of that right.

 

28. COUNTERPARTS

This Security Agreement may be executed in any number of counterparts. This has the same effect as if the signatures on the counterparts were on a single copy of this Security Agreement.

 

29. GOVERNING LAW

This Security Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.

 

30. ENFORCEMENT

 

30.1 Jurisdiction

 

(a) The English courts have exclusive jurisdiction to settle any dispute including a dispute relating to non-contractual obligations arising out of or in connection with this Security Agreement.

 

(b) The English courts are the most appropriate and convenient courts to settle any such dispute in connection with this Security Agreement. Each Chargor agrees not to argue to the contrary and waives objection to those courts on the grounds of inconvenient forum or otherwise in relation to proceedings in connection with this Security Agreement.

 

(c) This Clause is for the benefit of the Secured Parties only. To the extent allowed by law, a Secured Party may take:

 

  (i) proceedings in any other court; and

 

  (ii) concurrent proceedings in any number of jurisdictions.

 

(d) References in this Clause to a dispute in connection with this Security Agreement includes any dispute as to the existence, validity or termination of this Security Agreement.

 

30.2 Waiver of immunity

Each Chargor irrevocably and unconditionally:

 

  (a) agrees not to claim any immunity from proceedings brought by a Secured Party against it in relation to this Security Agreement and to ensure that no such claim is made on its behalf;

 

  (b) consents generally to the giving of any relief or the issue of any process in connection with those proceedings; and

 

  (c) waives all rights of immunity in respect of it or its assets.

 

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This Security Agreement has been entered into and executed as a deed by each Chargor with the intention that it be delivered on the date stated at the beginning of this deed. It may be executed by the Collateral Agent under hand or if it prefers as a deed

 

25

SIGNATORIES

 

Chargors   
EXECUTED AS A DEED by    )
ACD TRIDON (HOLDINGS) LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

26

EXECUTED AS A DEED by    )
AIR SYSTEM COMPONENTS INVESTMENTS CHINA LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

27

EXECUTED AS A DEED by    )
BETA NACO LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

28

EXECUTED AS A DEED by    )
BRITISH INDUSTRIAL VALVE COMPANY LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

29

EXECUTED AS A DEED by    )
GATES AUTO PARTS HOLDINGS CHINA LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

30

EXECUTED AS A DEED by    )
GATES ENGINEERING & SERVICES UK HOLDINGS LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

31

EXECUTED AS A DEED by    )
GATES FLUID POWER TECHNOLOGIES INVESTMENTS LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

32

EXECUTED AS A DEED by    )
GATES HOLDINGS LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

33

EXECUTED AS A DEED by    )
H HEATON LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

34

EXECUTED AS A DEED by    )
OLYMPUS (ORMSKIRK) LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

35

EXECUTED AS A DEED by    )
RUSKIN AIR MANAGEMENT LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

36

EXECUTED AS A DEED by    )
SHIITAKE LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

37

EXECUTED AS A DEED by    )
STACKPOLE INVESTMENTS LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

38

EXECUTED AS A DEED by    )
SWINDON SILICON SYSTEMS LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

39

EXECUTED AS A DEED by    )
TOMKINS ENGINEERING LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

40

EXECUTED AS A DEED by    )
TOMKINS FINANCE LUXEMBOURG LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

41

EXECUTED AS A DEED by    )
TOMKINS FINANCE LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

42

EXECUTED AS A DEED by    )
TOMKINS FUNDING LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

43

EXECUTED AS A DEED by    )
TOMKINS IDEAL CLAMPS (SUZHOU) INVESTMENTS LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

44

EXECUTED AS A DEED by    )
TOMKINS INVESTMENTS CHINA LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

45

EXECUTED AS A DEED by    )
TOMKINS INVESTMENTS LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

46

EXECUTED AS A DEED by    )
TOMKINS OVERSEAS COMPANY UNLIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

47

EXECUTED AS A DEED by    )
TOMKINS OVERSEAS INVESTMENTS LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

48

EXECUTED AS A DEED by    )
TOMKINS PENSION SERVICES LIMITED    )     /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

49

EXECUTED AS A DEED by    )
TOMKINS LIMITED    )     /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:

  

JOANNA MACINTOSH

Address:

  

99 BISHOPSGATE

LONDON EC2M 3XF

 

50

EXECUTED AS A DEED by    )
TOMKINS SC1 LIMITED    )     /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

51

EXECUTED AS A DEED by    )
TOMKINS STERLING COMPANY UNLIMITED    )     /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

 

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

52

EXECUTED AS A DEED by    )
TOMKINS TREASURY (CANADIAN DOLLAR) COMPANY UNLIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

53

EXECUTED AS A DEED by    )
TOMKINS TREASURY (DOLLAR) COMPANY UNLIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

54

EXECUTED AS A DEED by    )
TOMKINS TREASURY (EURO) COMPANY UNLIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

55

EXECUTED AS A DEED by    )
TRICO PRODUCTS (DUNSTABLE) LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

56

EXECUTED AS A DEED by    )
WILLER & RILEY LIMITED    )    /s/ John Zimmerman
acting by JOHN ZIMMERMAN    )

Attorney

In the presence of:

Witness’s signature:  

/s/ Joanna Macintosh

Name:  

JOANNA MACINTOSH

Address:  

99 BISHOPSGATE

LONDON EC2M 3XF

 

57

Collateral Agent

EXECUTED AS A DEED by

WILMINGTON TRUST FSB, as collateral agent

By:    /s/ Joseph P. O’Donnell

Joseph P. O’Donnell

Vice President

 

58

EX-12.1 44 dex121.htm EXHIBIT 12.1 Exhibit 12.1

Exhibit 12.1

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

Ratio of earnings to fixed charges (unaudited)

Prepared in accordance with IFRS

 

$ in millions    Successor             Predecessor      Pro forma             Successor            Predecessor  
     Q1 2011             Q1 2010      Fiscal
2010 		            Q4 2010            9M 2010      Fiscal  
                            2009      2008     2007     2006  

Fixed charges

                                       

Interest expense

      74.8              7.1         301.2              75.5             21.4         43.2         59.4        65.8        66.9   

Rental expense

      4.4              4.2         17.0              4.5             12.6         19.8         18.4        17.9        16.7   

Preference security dividend requirement

      –              –         –              –             –         –         –        1.6        11.6   
                                                                                            

Total fixed charges

      79.2              11.3         318.2              80.0             34.0         63.0         77.8        85.3        95.2   
     

Earnings

                                       

Profit/(loss) before tax from continuing operations before share of profit or loss of associates

      26.7              114.6         16.9              (303.8 )           314.9         38.8         (6.0 )      524.3        445.6   

Fixed charges

      79.2              11.3         318.2              80.0             34.0         63.0         77.8        85.3        95.2   

Distributed earnings of associates

      0.5              0.2         0.5              –             0.5         0.3         0.6        1.4        0.6   

Preference security dividend requirement

      –              –         –              –             –         –         –        (1.6 )      (11.6 ) 
                                                                                            

Total earnings

      106.4              126.1         335.6              (223.8 )           349.4         102.1         72.4        609.4        529.8   
                                                                                            

Ratio of earnings to fixed charges

      1.34              11.16         1.05              –             10.28         1.62         0.93        7.14        5.57   
     

Dollar amount of deficiency(1)

                         (303.8 )                 (5.4 )     

 

(1) The ratio of earnings to fixed charges has been calculated based on financial information prepared in accordance with IFRS. For the purpose of calculating this ratio, earnings consist of profit/(loss) before tax from continuing operations before our share of the profit or loss of associates, plus fixed charges and the distributed earnings of associates and less the preference security dividend requirement. Fixed charges consist of interest expense, including the amortization of debt issuance costs, an estimate of the interest within rental expense and, for Fiscal 2007 and Fiscal 2006, the preference security dividend requirements of consolidated subsidiaries.

 

(2) Earnings were deficient to cover fixed charges by $303.8 million for Q4 2010 and by $5.4 million for Fiscal 2008. Earnings for Q4 2010 have been negatively impacted by charges related to the Acquisition, including:

 

  •  

the effect on cost of sales of the uplift to the carrying amount of inventory held by Tomkins on its acquisition by the Group of $144.2 million;

 

  •  

transaction costs of $78.2 million incurred in relation to the Acquisitions; and

 

  •  

a currency translation loss of $47.6 million on the acquisition of Tomkins due to the change in the rate of exchange between the pound sterling (in which the purchase consideration was denominated) and the US dollar (the functional currency of the acquiring entity), in the period between the effective date of the acquisition and the payment of the consideration to the former shareholders in Tomkins.

 

     During Q4 2010, we also recognized a compensation expense in relation to share-based incentives of $72.4 million that was disproportionately high for the quarter due to the immediate vesting of certain awards.
EX-21.1 45 dex211.htm EXHIBIT 21.1 Exhibit 21.1

Exhibit 21.1

 

Entity Name

   

Jurisdiction of Formation

ACD Tridon (Holdings) Limited    United Kingdom
ACD Tridon Inc.    Canada
Air System Components, Inc.    Delaware
Air Systems Components Investments China Ltd    United Kingdom
Air Systems Components Suzhou Ltd    China
AMP Industrial Mexicana, S.A. de C.V.    Mexico
Applicadores Mexicanos, S.A. de C.V.    Mexico
Aquatic Co.    Delaware
Aquatic Trucking Co.    Delaware
Auto Industrial de Partes, S.A. de C.V.    Mexico
Beta Naco Limited    United Kingdom
British Industrial Valve Company Limited    United Kingdom
Broadway Mississippi Development, LLC    Colorado
Buffalo Holding Company    Delaware
Carriage House Fruit Company    California
Caryaire Air Systems Components Private Limited    India
Conergics Corporation    Delaware
Dexter Axle Acquisition Corp.    Delaware
Dexter Axle Company    Delaware
Dexter Axle Trucking Company    Delaware
Dexter Chassis Group, Inc.    Michigan
Eastern Sheet Metal, Inc.    Ohio
Eifeler Maschinenbau GmbH    Germany
E-Industries Inc.    Indiana
EMB International Trading (Shanghai) Co. Ltd    China
EMB Isopower SA    Spain
EMB Technologie GmbH    Germany
Epicor Industries, Inc.    Delaware
FBN Transportation, Inc.    Ohio
Fister S.r.l.    Italy
Formflo Limited    United Kingdom
Gates (India) Private Limited    India
Gates (U.K.) Limited    United Kingdom
Gates AE Hydraulic Pte Ltd    Singapore
Gates Argentina S.A.    Argentina

Gates Engineering & Services Pty Ltd ACN 142 531 244

    Australia
Gates Belgium PT Holding LLC    Belgium
Gates Canada Inc.    Canada
Gates CIS LLC    Russia
Gates de Mexico, S.A. de C.V.    Mexico

Entity Name

   

Jurisdiction of Formation

Gates Development Corporation    Colorado
Gates Distibution Centre N.V.    Belgium
Gates do Brasil Industria e Commercio Ltda    Brazil
Gates EMB Hydraulic (Shanghai) Co Limited    China
Gates Engineering & Services Australia Pty Ltd    Australia
Gates Engineering & Services FZCO    United Arab Emirates
Gates Engineering & Services Hamriyah FZE    United Arab Emirates
Gates Engineering & Services Ltd.    British Virgin Islands
Gates Europe N.V.    Belgium
Gates European Holdings Limited    United Kingdom
Gates Fleximak LLC    United Arab Emirates
Gates Fleximak Ltd.    British Virgin Islands
Gates Fluid Power (Suzhou) Company., Limited    China
Gates Fluid Power Technologies (Changzhou) Co., Ltd    China
Gates Fluid Power Technologies Investments Limited    United Kingdom
Gates France S.a.r.l.    France
Gates GmbH    Germany
Gates Güç Aktarim Sistemleri Dagitim Sanayi Ve Ticaret Limited Sirketi    Turkey
Gates Holdings GmbH    Germany
Gates Holdings Limited    United Kingdom
Gates Hydraulics Limited    United Kingdom
Gates Hydraulics sro    Czech Republic
Gates International Holdings, LLC    Colorado
Gates Kaucuk ve Metal Sanayi ve Ticaret Limited Sirketi (Gates Rubber and Metal Industry and Trade, LLC)    Turkey
Gates Korea Company, Limited (51% owned subsidiary)    Korea
Gates Mectrol GmbH    Germany
Gates Mectrol, Inc.    Delaware
Gates Nitta Belt Company, LLC    Delaware
Gates Nitta Limited    United Kingdom
Gates Nitta LLC    Delaware
Gates Polska S.p.z o.o    Poland
Gates Power Transmission Europe BVBA    Belgium
Gates Power Transmission Limited    United Kingdom
Gates Powertrain Plastik Metal ve Makina Sanayii veTicaret Limited Sirketi (Gates Rubber and Metal Industry and Trade, LLC)    Turkey
Gates PT Spain SA    Spain
Gates Rubber (Shanghai) Co., Ltd    China
Gates Rubber Company (S) Pte Limited    Singapore
Gates S.A.S.    France
Gates S.r.l.    Italy

Entity Name

   

Jurisdiction of Formation

Gates Service Center S.A.S.    France
Gates Unita Asia Trading Co. Pte. Limited (51% owned subsidiary)    Singapore
Gates Unitta Asia Company (51% owned subsidiary)    Japan
Gates Unitta India Company Private Limited (51% owned subsidiary)    India
Gates Unitta Korea Company Limited (51% owned subsidiary)    Korea
Gates Unitta Power Transmission (Shanghai) Ltd.    China
Gates Unitta Power Transmission (Suzhou) Ltd.    China
Gates Unitta Thailand Co., Ltd (51% owned subsidiary)    Thailand
Gates Winhere Autopump Products (Yantai) Co. Ltd    China
Gates Winhere LLC    Delaware
Glass Master Corporation    Texas
Gripperrods Limited    United Kingdom
GU Trading (Suzhou) Co., Limited    China
Halla Stackpole (Beijing) Automotive Company, Limited    China
Halla Stackpole Corporation    Korea
Hart & Cooley Trucking Company    Delaware
Hart & Cooley, Inc.    Delaware
Hydrolink Bahrain WLL    Bahrain
Hydrolink Company LLC (Sharjah)    UAE
Hydrolink United Kingdom Holding Limited    United Kingdom
Hytec, Inc.    Washington
Ideal Clamps (Suzhou) Co. Limited    China
Ideal Clamps Products, Inc.    Tennessee
Industrias Selkirk de Mexico S. de RL    Mexico
Koch Filter Corporation    Kentucky
Lerma Hose Plant S.A. de C.V.    Mexico
Magnum Drive Property LLC    Indiana
MD Property Holding Co.    Delaware
Montisk Investments Netherlands C.V.    Netherlands
National Duct Systems, Inc.    Texas
NRG Industries Inc. (Delaware)    Delaware
NRG Industries, Inc. (Texas)    Texas
Olympus (Ormskirk) Limited    United Kingdom
Philips Products, Inc.    Delaware
Pinafore Holdings B.V.    Netherlands
Rolastar Private Limited    India
Rooftop Systems, Inc.    Texas
Ruskin (Thailand) Co., Ltd    Thailand
Ruskin Air Management Limited    United Kingdom
Ruskin Company    Delaware

Entity Name

   

Jurisdiction of Formation

Ruskin Company Canada Inc.    Canada
Ruskin de Mexico S.A. de C.V.    Mexico
Ruskin Service Company    Delaware
Ruskin Titus Gulf Manufacturing LLC    Dubai
Schrader Duncan Limited (50% associate)    India
Schrader Electronics Limited   

Northern Ireland

Schrader Electronics, Inc.    Delaware
Schrader Engineered Products (Kunshan) Co., Limited    China
Schrader International Holding Co.    Delaware
Schrader Investments Luxembourg S.à.r.l.    Luxembourg
Schrader, LLC    Delaware
Schrader S.A.S.    France
Schrader International Brasil Ltda    Brazil
Schrader-Bridgeport International, Inc.    Delaware
Selkirk Americas, L.P.    Delaware
Selkirk Canada Corporation    Canada
Selkirk Canada Holdings, L.P.    Delaware
Selkirk Corporation    Delaware
Selkirk IP L.L.C.    Delaware
Shiitake Limited    United Kingdom
Stackpole Investments Limited    United Kingdom
Swindon Silicon Systems Limited    United Kingdom
The Gates Corporation    Delaware
Tomkins (Shanghai) Management Consulting Company Limited    China
Tomkins Acquisitions Limited    United Kingdom
Tomkins American Investments S.à.r.l.    Luxembourg
Tomkins Automotive Canada Limited    Canada
Tomkins Automotive Holding Co.    Delaware
Tomkins Building Products, Inc.    Delaware
Tomkins Consulting Services India Ltd    India
Tomkins Engineering Limited    United Kingdom
Tomkins Engineering S.à.r.l.    Luxembourg
Tomkins Finance Limited    United Kingdom
Tomkins Finance Luxembourg Limited    United Kingdom
Tomkins Funding Limited    United Kingdom
Tomkins Holdings Luxembourg S.à.r.l.    Luxembourg
Tomkins Ideal Clamps (Suzhou) Investments Limited    United Kingdom
Tomkins Industries, Inc.    Ohio
Tomkins Insurance Limited    Isle of Man
Tomkins Investments China Limited    United Kingdom

Entity Name

   

Jurisdiction of Formation

Tomkins Investments Limited    United Kingdom
Tomkins Limited    United Kingdom
Tomkins Luxembourg S.à.r.l.    Luxembourg
Tomkins Mauritius Company Limited    United Kingdom
Tomkins Overseas Company    United Kingdom
Tomkins Overseas Finance S.à.r.l.    Luxembourg
Tomkins Overseas Funding S.à.r.l.    Luxembourg
Tomkins Overseas Holdings S.à.r.l.    Luxembourg
Tomkins Poly Belt Mexicana S.A. de C.V.    Mexico
Tomkins SC1 Limited    United Kingdom
Tomkins Sterling Company    United Kingdom
Tomkins Treasury (Canadian Dollar) Company    United Kingdom
Tomkins Treasury (Dollar) Company    United Kingdom
Tomkins Treasury (Euro) Company    United Kingdom
Tomkins U.S., L.P.    Delaware
Tomkins, Inc.    Delaware
Tomkins, LLC    Delaware
Tridon Clamp Products GmbH    Germany
Tridon Europe Limited    United Kingdom
Trion (Deutschland) GmbH    Germany
Waltham Real Estate Holding Co.    Delaware
Willer & Riley Limited    United Kingdom
 EX-23.1 46 dex231.htm EXHIBIT 23.1 Exhibit 23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use in this Registration Statement on Form F-4 of our report dated March 30, 2011 relating to the consolidated financial statements of Pinafore Holdings B.V., which appears in such Registration Statement.

We also consent to the reference to us under the headings “Experts” in such Registration Statement.

DELOITTE LLP

London, UK

June 24, 2011

EX-25.1 47 dex251.htm EXHIBIT 25.1 Exhibit 25.1

Exhibit 25.1

File No.                    

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939

OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

¨ CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE

PURSUANT TO

SECTION 305(b)(2)

WILMINGTON TRUST FSB

(Exact name of trustee as specified in its charter)

 

Federal Charter   52-1877389
(State of incorporation)   (I.R.S. employer identification no.)

1100 North Market Street

Wilmington, Delaware 19890-0001

(Address of principal executive offices)

Michael A. DiGregorio

Senior Vice President and General Counsel

Wilmington Trust Company

1100 North Market Street

Wilmington, Delaware 19890-0001

(302) 651-8793

(Name, address and telephone number of agent for service)

PINAFORE HOLDINGS B.V.1

(Exact name of obligor as specified in its charter)

 

The Netherlands   3714
(State of incorporation)   (I.R.S. employer identification no.)
1076 EE  

Amsterdam

The Netherlands

  
(Address of principal executive offices)   (Zip Code)

9% Senior Secured Second Lien Notes

Guarantees of 9% Senior Secured Second Lien Notes

(Title of the indenture securities)

TABLE OF ADDITIONAL OBLIGORS

 

1 SEE TABLE OF ADDITIONAL OBLIGORS

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

ACD TRIDON (HOLDINGS) LIMITED    United Kingdom    3585      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

ACD TRIDON INC.    Ontario, Canada    3585      

P.O. Box 310

300 Henry Street

Brantford ON N3T 5W1, Canada

+1.416.250.1033

AIR SYSTEM COMPONENTS, INC.    Delaware    3585    23-3023656   

1401 N. Plano Road

Richardson, Texas 75081

+1.972.301.9645

AIR SYSTEMS COMPONENTS INVESTMENTS CHINA LIMITED    United Kingdom    3585      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

AMP INDUSTRIAL MEXICANA, S.A. DE C.V.    Mexico    3585      

Cerrada Centinela Num. 1782, Parque Industrial Cachanilla, Mexicali, B.C., 21394, Mexico

+1.972.943.6150

APLICADORES MEXICANOS, S.A. DE C.V.    Mexico    3714      

Avenida Parques Industriales y Magneto, Parque Industrial GEMA, Ciudad Juarez, Chihuahua, 32310, Mexico

+1.972.301.9645

AQUATIC CO.    Delaware    3430    36-4284100   

8101 E Kaiser Blvd.

Suite 200

Anaheim, California 92808

+1.714.993.1220

AQUATIC TRUCKING CO.    Delaware    3430    31-1631458   

8101 E Kaiser Blvd.

Suite 200

Anaheim, California 92808

+1.714.993.1220

AUTO INDUSTRIAL DE PARTES, S.A. DE C.V.    Mexico    3714      

Lic. Albino Hernandez No 7 Pte., Colonia Obrera, H. Matamoros, Tamaulipas, 78540, Mexico

Attention: Antonio D’Addona

+52.868.816.0998

BETA NACO LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

BRITISH INDUSTRIAL VALVE COMPANY LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

BROADWAY MISSISSIPPI DEVELOPMENT, LLC    Colorado    3990    27-1050109   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

BUFFALO HOLDING COMPANY    Delaware    3990    22-2977811   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

CARRIAGE HOUSE FRUIT COMPANY    California    3990    77-0400825   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

CONERGICS CORPORATION    Delaware    3990    48-0776015   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

DEXTER AXLE ACQUISITION CORP.    Delaware    3714    20-2417200   

2900 Industrial Parkway

Elkhart, Indiana 46516

+1.574.296.7214

DEXTER AXLE COMPANY    Delaware    3714    36-4284104   

2900 Industrial Parkway

Elkhart, Indiana 46516

+1.574.296.7214

DEXTER AXLE TRUCKING COMPANY    Delaware    3714    36-4289434   

2900 Industrial Parkway

Elkhart, Indiana 46516

+1.574.296.7214

DEXTER CHASSIS GROUP, INC.    Michigan    3714    38-3042888   

501 S. Miller

White Pigeon, Michigan 49099

+1.574.296.7214

E INDUSTRIES, INC.    Indiana    3714    37-1437274   

4526 Chester Drive

Elkhart, Indiana 46516

+1.574.522.7550

EASTERN SHEET METAL, INC.    Ohio    3714    31-0932614   

8959 Blue Ash Road

Cincinnati, Ohio 45236

+1.513.793.3440

EIFELER MASCHINENBAU GMBH    Germany    3714      

Kolumbusstr. 54, 53881

Euskirchen, Germany

+49.2251.256.200

EPICOR INDUSTRIES, INC.    Delaware    3714    36-3672434   

3200 Parker Drive

St. Augustine, Florida 32084

+1.615.355.1137

FBN TRANSPORTATION, INC.    Ohio    3714    04-3726434   

8959 Blue Ash Road

Cincinnati, Ohio 45236

+1.513.793.3440

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

GATES AUTO PARTS HOLDINGS CHINA LIMITED    United Kingdom    3714      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

GATES CIS LLC    Russia    3714      

1-st Dobryninsky per., building 15/7 #25, Moscow 119049, Russia

+32.53.762.830

GATES DEVELOPMENT CORPORATION    Colorado    3714    84-1581944   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

GATES ENGINEERING & SERVICES AUSTRALIA PTY LTD    Australia    3714      

15 Dalzell Turn, Kinross, Perth, Australia, 6028

+1.61.9258.8399

GATES ENGINEERING & SERVICES HAMRIYAH FZE    United Arab Emirates    3714      

Plot no. 2M-10, PO Box 49047, Hamriyah Free zone, Sharjah, United Arab Emirates

+971.4886.1414

GATES ENGINEERING & SERVICES FZCO    United Arab Emirates    3714      
GATES ENGINEERING & SERVICES LTD.    British Virgin Islands    3714      

Cragmuir Chambers

P.O. Box 71, Road Town, Tortola, British Virgin Islands

+1.284.494.2233

GATES ENGINEERING & SERVICES UK HOLDINGS LIMITED    United Kingdom    3714      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

GATES FLEXIMAK LTD.    British Virgin Islands    3714      

Cragmuir Chambers

P.O. Box 71, Road Town, Tortola, British Virgin Islands

+1.284.494.2233

GATES FLUID POWER TECHNOLOGIES INVESTMENTS LIMITED    United Kingdom    3714      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

GATES GÜÇ AKTARIM SISTEMLERI DAGITIM SANAYI VE TICARET LIMITED SIRKETI    Turkey    3714      

Peliti Koyu Karacayir Mevkii 2, Bolge, Gebze Kocaeli, Turkey

+34.93.877.7016

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

GATES HOLDING GMBH    Germany    3714      

Kolumbusstr. 54, 53881

Euskirchen, Germany

+49.2251.1256.200

GATES HOLDINGS LIMITED    United Kingdom    3714      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

GATES INTERNATIONAL HOLDINGS, LLC    Colorado    3714      

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

GATES MECTROL GMBH    Germany    3714      

Werner von Siemens Strasse 2, 64319 Pfungstadt, Germany

+32.53.762.891

GATES MECTROL, INC.    Delaware    3714    11-3732833   

9 Northwestern Drive,

Salem, New Hampshire 03079

+1.303.744.4939

GATES POWER TRANSMISSION EUROPE BVBA    Belgium    3714      

Dr. Carlierlaan 30, B-9320 Erembodegem (Aalst), Belgium

+32.53.762.830

GATES POWERTRAIN PLASTIK METAL VE MAKINA SANAYII VETICARET LIMITED SIRKETI    Turkey    3714      

Ege Serbest Bolgesi, Gaziemir, Izmir, 35410, Turkey

+34.93.877.7016

GATES POWERTRAIN UK LIMITED    United Kingdom    3714      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

GLASS MASTER CORPORATION    Texas    3714    74-7624056   

2420 McIver, #101

Carrollton Texas 75006

+1.816.761.7476

H HEATON LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

HART & COOLEY TRUCKING COMPANY    Delaware    3585    61-1436877   

5030 Corporate Exchange Blvd.

Grand Rapids, Michigan 49512

+1.972.943.6150

HART & COOLEY, INC.    Delaware    3585    52-2206266   

5030 Corporate Exchange Blvd.

Grand Rapids, Michigan 49512

+1.972.943.6150

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

HYTEC, INC.    Washington    3430    91-0839632   

801 Northern Pacific Road

P.O. Box 1180

Yelm, Washington 98597

+1.714.993.1220

IDEAL CLAMP PRODUCTS, INC.    Tennessee    3714    62-1051193   

8100 Tridon Drive

Smyrna, Tennessee 37172

+1.615.355.1137

KOCH FILTER CORPORATION    Kentucky    3585    61-0674289   

625 W Hill

Louisville, Kentucky 40208

+1.502.634.4796

MONTISK INVESTMENTS NETHERLANDS C.V.    Netherlands    3990      

Leidsweg 37, 2nd Floor

2252 LA, Voorscholen

The Netherlands

+35.222.8229

NATIONAL DUCT SYSTEMS, INC.    Texas    3585    75-2456831   

1401 Dunn Drive, Suite 110, Carrollton TX 75006

+1.816.761.7476

NRG INDUSTRIES, INC. (DELAWARE ENTITY)    Delaware    3585    75-2452241   

3900 Dr. Greaves Road

Kansas City, Missouri 64030

+1.816.761.7476

NRG INDUSTRIES, INC. (TEXAS ENTITY)    Texas    3585    74-1748186   

2405 McIver

Carrollton, Texas 75006

+1.816.761.7476

OLYMPUS (ORMSKIRK) LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

ROOFTOP SYSTEMS, INC.    Texas    3585    75-1908331   

1625 Diplomat Drive, Carrollton Texas 75006

+1.816.761.7476

RUSKIN AIR MANAGEMENT LIMITED    United Kingdom    3585      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

RUSKIN COMPANY    Delaware    3585    43-1845398   

3900 Dr. Greaves Road

Kansas City, Missouri 64030

+1.816.761.7476

RUSKIN COMPANY CANADA INC.    Ontario, Canada    3585      

152 East Drive, Brampton

Ontario L6T 1E1, Canada

+1.816.761.7476

RUSKIN DE MÉXICO, S.A. DE C.V.    Mexico    3585      

Tapioca # 5455-A Infonavit Ampliacion Aeropuerto

Juarez CHI, Mexico 32698

+1.816.761.7476

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

RUSKIN SERVICE COMPANY    Delaware    3585    43-1871609   

3900 Dr. Greaves Road

Kansas City, Missouri 64030

+1.816.761.7476

SCHRADER ELECTRONICS LIMITED    Northern Ireland    3714      
SCHRADER ELECTRONICS, INC.    Delaware    3714    26-1353225   

101 Evergreen Drive

Springfield, Tennessee 37172

+1.615.384.0089

SCHRADER INTERNATIONAL BRASIL LTDA.    Brazil    3714      

1600 Avenida Malek Assad, Bairro Meia Lua, Jacarei, Sao Paulo, 12303-071, Brazil

+55.3954.6500

SCHRADER INTERNATIONAL HOLDING CO.    Delaware    3714    27-1382757   

205 Frazier Road

Alta Vista, Virginia 24517

+1.303.744.5339

SCHRADER INVESTMENTS LUXEMBOURG S.À R.L.    Luxembourg    3714      

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

SCHRADER, LLC    Delaware    3714      

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

SCHRADER-BRIDGEPORT INTERNATIONAL, INC.    Delaware    3714    95-3959558   

205 Frazier Road

Alta Vista, Virginia 24517

+1.303.744.5339

SELKIRK AMERICAS, L.P.    Delaware    3714    71-0886085   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

SELKIRK CANADA HOLDINGS, L.P.    Delaware    3714    36-4499487   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

SELKIRK CORPORATION    Delaware    3714    71-0886094   

5030 Corporate Exchange Blvd.

Grand Rapids, Michigan 49512

+1.972.943.6150

SELKIRK IP L.L.C.    Delaware    3714    20-0776546   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

SHIITAKE LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

STACKPOLE INVESTMENTS LIMITED    United Kingdom    3714      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

SWINDON SILICON SYSTEMS LIMITED    United Kingdom    3714      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

THE GATES CORPORATION    Delaware    3990    84-0857401   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS ACQUISITIONS LIMITED    United Kingdom    3990    98-0360549   

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS AMERICAN INVESTMENTS S.À R.L.    Luxembourg    3990      

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS AUTOMOTIVE CANADA LIMITED    Ontario, Canada    3714      

4123 Yonge Street

North York, Ontario

Canada M2P 2B8

+1.416.250.1033

TOMKINS AUTOMOTIVE COMPANY, S.À R.L.    Luxembourg    3714      

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS AUTOMOTIVE HOLDING CO.    Delaware    3714    26-3004076   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS BUILDING PRODUCTS, INC.    Delaware    3990    62-1387341   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS ENGINEERING LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS FINANCE LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS FINANCE LUXEMBOURG LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

TOMKINS FUNDING LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS HOLDINGS LUXEMBOURG, S.À R.L.    Luxembourg    3990      

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS IDEAL CLAMPS (SUZHOU) INVESTMENTS LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS INDUSTRIES, INC.    Ohio    3990    31-0596713   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS INVESTMENTS CHINA LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS INVESTMENTS COMPANY S.À R.L.    Luxembourg    3990      

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS INVESTMENTS LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS LUXEMBOURG S.À R.L.    Luxembourg    3990      

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

TOMKINS MAURITIUS COMPANY LIMITED    Mauritius    3990      

Felix House, 24 Dr. Joseph Riviere Street, Port Louis, Mauritius

+230.216.8800

TOMKINS OVERSEAS COMPANY    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS OVERSEAS HOLDINGS S.À R.L.    Luxembourg    3990      

23-25 rue Notre Dame

L-2240 Luxembourg

+35.222.8229

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

TOMKINS OVERSEAS INVESTMENTS LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS PENSION SERVICES LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS POLY BELT MEXICANA, S.A. DE C.V.    Mexico    3990      

Km 96.5, Carretera Mexico-Cuautla #133, Fracc. Los Faroles, Tetelcingo, Cuautla, Morelos, 62751, Mexico

+1.303.744.4939

TOMKINS SC1 LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS STERLING COMPANY    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS TREASURY (CANADIAN DOLLAR) COMPANY    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS TREASURY (DOLLAR) COMPANY    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS TREASURY (EURO) COMPANY    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

TOMKINS U.S., L.P.    Delaware    3990    26-3112689   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS, INC.    Delaware    3990    33-1218687   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TOMKINS, LLC    Delaware    3990    99-0360549   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

TRICO PRODUCTS (DUNSTABLE) LIMITED    United Kingdom    3990      

East Putney House, 84 Upper Richmond Road, London, SW15 2ST, England

+44.20.8877.4544

Exact Name as

Specified in its Charter

    State or Other
Jurisdiction of
Incorporation or
Organization		    Primary
Standard
Industrial
Classification
Number		    I.R.S. Employer
Identification
Number		   

Address, Including Zip Code and
Telephone Number,

Including Area Code, of Principal
Executive Offices

TRIDON CLAMP PRODUCTS GMBH    Germany    3714      

10 Robert-Bosch Street, 53919,

Weilerswist, Germany

+32.53.762.800

TRION (DEUTSCHLAND) GMBH    Germany    3714      

Oehlecker Ring 26, D-22419,

Hamburg, Germany

+1.972.301.9645

WALTHAM REAL ESTATE HOLDING CO.    Delaware    3990    26-3003983   

1551 Wewatta Street

Denver, Colorado 80202

+1.303.744.5059

WILLER & RILEY LIMITED    United Kingdom    3990      

East Putney House, 84 Upper

Richmond Road, London,

SW15 2ST, England

+44.20.8877.4544

Item 1. GENERAL INFORMATION. Furnish the following information as to the trustee:

 

  (a) Name and address of each examining or supervising authority to which it is subject.

Office of Thrift Supervision

1475 Peachtree Street, N.E.

Atlanta, GA 30309

 

  (b) Whether it is authorized to exercise corporate trust powers.

Yes.

 

Item 2. AFFILIATIONS WITH THE OBLIGOR. If the obligor is an affiliate of the trustee, describe each affiliation:

Based upon an examination of the books and records of the trustee and upon information furnished by the obligor, the obligor is not an affiliate of the trustee.

 

Item 16. LIST OF EXHIBITS. List below are all exhibits filed as part of this Statement of Eligibility and Qualification.

 

  1. A copy of the Federal Stock Savings Bank Charter for Wilmington Trust FSB, incorporated by reference to Exhibit 1 of Form T-1.

 

  2. The authority of Wilmington Trust FSB to commence business was granted under the Federal Stock Savings Bank Charter for Wilmington Trust FSB, incorporated herein by reference to Exhibit 1 of Form T-1.

 

  3. The authorization to exercise corporate trust powers was granted under the Federal Stock Savings Bank charter, incorporated herein by reference to Exhibit 1 of Form T-1.

 

  4. A copy of the existing By-Laws of Trustee, as now in effect, incorporated herein by reference to Exhibit 4 of form T-1.

 

  5. Not applicable.

 

  6. The consent of Trustee as required by Section 321(b) of the Trust Indenture Act of 1939, incorporated herein by reference to Exhibit 6 of Form T-1.

 

  7. Current Report of the Condition of Trustee, published pursuant to law or the requirements of its supervising or examining authority, attached as Exhibit 7.

 

  8. Not applicable.

 

  9. Not applicable.

SIGNATURE

Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, Wilmington Trust FSB, a federal savings bank, organized and existing under the laws of the United States of America, has duly caused this Statement of Eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of Guilford and State of Connecticut on the 17th day of June, 2011.

 

WILMINGTON TRUST FSB
By:  

/s/ Joseph P. O’Donnell

Name:   Joseph P. O’Donnell
Title:   Vice President

EXHIBIT 1

Charter No. 6012

FEDERAL STOCK SAVINGS BANK CHARTER

WILMINGTON TRUST FSB

As existing on June 10, 1994.

FEDERAL STOCK SAVINGS BANK CHARTER

WILMINGTON TRUST FSB

SECTION 1. Corporate Title. The full corporate title of the savings bank is Wilmington Trust FSB.

SECTION 2. Office. The home office shall be located in Salisbury, Maryland.

SECTION 3. Duration. The duration of the savings bank is perpetual.

SECTION 4. Purpose and Powers. The purpose of the savings bank is to pursue any or all of the lawful objectives of a Federal savings bank chartered under Section 5 of the Home Owners’ Loan Act and to exercise all of the express, implied, and incidental powers conferred thereby and by all acts amendatory thereof and supplemental thereto, subject to the Constitution and laws of the United States as they are now in effect, or as they may hereafter be amended, and subject to all lawful and applicable rules, regulations, and orders of the Office of Thrift Supervision (“OTS”).

SECTION 5. Capital Stock. The total number of shares of all classes of the capital stock which the savings bank has the authority to issue is 10,000,000, all of which shall be common stock of par value of $1.00 per share. The shares may be issued from time to time as authorized by the Board of Directors without the approval of its shareholders, except as otherwise provided in this Section 5 or to the extent that such approval is required by governing law, rule, or regulation. The consideration for the issuance of the shares shall be paid in full before their issuance and shall not be less than the par value. Neither promissory notes nor future services shall constitute payment or part payment for the issuance of shares of the savings bank. The consideration for the shares shall be cash, tangible or intangible property (to the extent direct investment in such property would be permitted to the savings bank), labor, or services actually performed for the savings bank, or any combination of the foregoing. In the absence of actual fraud in the transaction, the value of such property, labor, or services, as determined by the Board of Directors of the savings bank, shall be conclusive. Upon payment of such consideration, such shares shall be deemed to be fully paid and nonassessable. In the case of a stock dividend, that part of the surplus of the savings bank which is transferred to stated capital upon the issuance of shares of as a share dividend shall be deemed to be the consideration for their issuance.

Except for shares issuable in connection with the conversion of the savings bank from the mutual to stock form of capitalization, no shares of common stock (including shares issuable upon conversion, exchange, or exercise of other securities) shall be issued, directly or indirectly, to officers, directors, or controlling persons of the savings bank other than as part of a general public offering or as qualifying shares to a director, unless the issuance or the plan under which they would be issued has been approved by a majority of the total votes eligible to be cast at a legal meeting.

The holders of the common stock shall exclusively possess all voting power. Each holder of shares of common stock shall be entitled to one vote for each share held by such holder, except as to the cumulation of votes for the election of directors. Subject to any provision for a liquidation account, in the event of any liquidation, dissolution, or winding up of the savings bank, the holders of the common stock shall be entitled, after payment or provision for payment of all debts and liabilities of the savings bank, to receive the remaining assets of the savings bank available for distribution, in cash or in kind. Each share of common stock shall have the same relative rights as and be identical in all respects with all the other shares of common stock.

SECTION 6. Preemptive Rights. Holders of the capital stock of the savings bank shall not be entitled to preemptive rights with respect to any shares of the savings bank which may be issued.

SECTION 7. Directors. The savings bank shall be under the direction of a Board of Directors. The authorized number of directors, as stated in the savings bank’s bylaws, shall not be fewer than five nor more than fifteen except when a greater number is approved by the OTS.

SECTION 8. Amendment of Charter. Except as provided in Section 5, no amendment, addition, alteration, change, or repeal of this charter shall be made, unless such is first proposed by the Board of Directors of the savings bank, then preliminarily approved by the OTS, which preliminary approval may be granted by the OTS pursuant to regulations specifying preapproved charter amendments, and thereafter approved by the shareholders by a majority of the total votes eligible to be cast at a legal meeting. Any amendment, addition, alteration, change, or repeal so acted upon shall be effective upon filing with the OTS in accordance with regulatory procedures or on such other date as the OTS may specify in its preliminary approval.

EXHIBIT 4

BY-LAWS OF WILMINGTON TRUST FSB

As Amended April 28, 2008

ARTICLE I — HOME OFFICES

The home office of this savings bank shall be at 111 South Calvert Street, Suite 2620, Baltimore, Maryland.

ARTICLE II — SHAREHOLDERS

SECTION 1. Place of Meetings. All annual and special meetings of shareholders shall be held at the home office of the savings bank or at such other place in or outside the State in which the principal place of business of the savings bank is located as the board of directors may determine.

SECTION 2. Annual Meeting. A meeting of the shareholders of the savings bank for the election of directors and for the transaction of any other business of the savings bank shall be held annually within 120 days after the end of the savings bank’s fiscal year or at such other date and time within at such 120-day period as the board of directors may determine.

SECTION 3. Special Meetings. Special meetings of the shareholders for any purpose or purposes, unless otherwise prescribed by the regulations of the Office of Thrift Supervision (“OTS”), may be called at any time by the chairman of the board, one of the presidents or a majority of the board of directors, and shall be called by the chairman of the board, one of the presidents, or the secretary upon the written request of the holders of not less than one-tenth of all of the outstanding capital stock of the savings bank entitled to vote at the meeting. Such written request shall state the purpose or purposes of the meeting and shall be delivered to the home office of the savings bank addressed to the chairman of the board, one of the presidents, or the secretary.

SECTION 4. Conduct of Meetings. The board of directors shall designate, when present, either the chairman of the board or one of the presidents to preside at such meetings.

SECTION 5. Notice of Meeting. Written notice stating the place, day and hour of the meeting and the purpose(s) for which the meeting is called shall be delivered not fewer than 20 nor more than 50 days before the date of the meeting, either personally or by mail, by or at the direction of the chairman of the board, one of the presidents, the secretary or the directors calling the meeting, to each shareholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the mail, addressed to the shareholder at the address as it appears on the stock transfer books or records of the savings bank as of the record date prescribed in Section 6 of this Article II with postage prepaid. When any shareholders’ meeting, either annual or

special, is adjourned for 30 days or more, notice of the adjourned meeting shall be given as in the case of an original meeting. It shall not be necessary to give any notice of the time or place of any meeting adjourned for less than 30 days or of the business to be transacted at the meeting, other than an announcement at the meeting at which such adjournment is taken.

SECTION 6. Fixing of Record Date. For the purpose of determining shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment, or shareholders entitled to receive payment of any dividend, or in order to make a determination of shareholders for any other proper purpose, the board of directors shall fix in advance a date as the record date for any such determination of shareholders. Such date in any case shall be not more than 60 days and, in case of a meeting of shareholders, not fewer than 10 days prior to the date on which the particular action, requiring such determination of shareholders, is to be taken. When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this section, such determination shall apply to any adjournment.

SECTION 7. Voting Lists. At least 20 days before each meeting of the shareholders, the officer or agent having charge of the stock transfer books for shares of the savings bank shall make a complete list of shareholders entitled to vote at such meeting, or any adjournment, arranged in alphabetical order, with the address and the number of shares held by each. This list of shareholders shall be kept on file at the home office of the savings bank and shall be subject to inspection by any shareholder at any time during usual business hours for a period of 20 days prior to such meeting. Such list also shall be produced and kept open at the time and place of the meeting and shall be subject to inspection by any shareholder during the entire time of the meeting. The original stock transfer book shall constitute prima facie evidence of the shareholders entitled to examine such list or transfer books or to vote at any meeting of shareholders.

In lieu of making the shareholder list available for inspection by shareholders as provided in the preceding paragraph, the board of directors may elect to follow the procedures prescribed in §552.6(d) of the OTS’s regulations as now or hereafter in effect.

SECTION 8. Quorum. A majority of the outstanding shares of the savings bank entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of shareholders. If less than a majority of the outstanding shares is represented at a meeting, a majority of the shares so represented may adjourn the meeting from time to time without further notice. At such adjourned meeting at which a quorum is present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. The shareholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough shareholders to constitute less than a quorum.

SECTION 9. Proxies. At all meetings of shareholders, a shareholder may vote by proxy executed in writing by the shareholder or by his duly authorized attorney-in-fact. Proxies solicited on behalf of the management shall be voted as directed by the shareholder or, in the absence of such direction, as determined by a majority of the board of directors. No proxy shall be valid more than eleven months from the date of its execution except for a proxy coupled with an interest.

SECTION 10. Voting of Shares in the Name of Two or More Persons. When ownership stands in the name of two or more persons, in the absence of written directions to the savings bank to the contrary, at any meeting of the shareholders of the savings bank any one or more of such shareholders may cast, in person or by proxy, all votes to which such ownership is entitled. In the event an attempt is made to cast conflicting votes, in person or by proxy, by the several persons in whose names shares of stock stand, the vote or votes to which those persons are entitled shall be cast as directed by a majority of those holding such and present in person or by proxy at such meeting, but no votes shall be cast for such stock if a majority cannot agree.

SECTION 11. Voting of Shares by Certain Holders. Shares standing in the name of another corporation may be voted by any officer, agent or proxy as the bylaws of such corporation may prescribe, or, in the absence of such provision, as the board of directors of such corporation may determine. Shares held by an administrator, executor, guardian, or conservator may be voted by him, either in person or by proxy, without a transfer of such shares into his name. Shares standing in the name of a trustee may be voted by him, either in person or by proxy, but no trustee shall be entitled to vote shares held by him without a transfer of such shares into his name. Shares standing in the name of a receiver may be voted by such receiver, and shares held by or under the control of a receiver may be voted by such receiver without the transfer into his name if authority to do so is contained in an appropriate order of the court or other public authority by which such receiver was appointed.

A shareholder whose shares are pledged shall be entitled to vote such shares until the shares have been transferred into the name of the pledgee, and thereafter the pledgee shall be entitled to vote the shares so transferred.

Neither treasury shares of its own stock held by the savings bank nor shares held by another corporation, if a majority of the shares entitled to vote for the election of directors of such other corporation are held by the savings bank, shall be voted at any meeting or counted in determining the total number of outstanding shares at any given time for purposes of any meeting.

SECTION 12. Cumulative Voting. Every shareholder entitled to vote at an election for directors shall have the right to vote, in person by proxy, the number of shares owned by the shareholder for as many persons as there are directors to be elected and for whose election the shareholder has a right to vote, or to cumulate the votes by giving one candidate as many votes as the number of such directors to be elected multiplied by the number of shares shall equal or by distributing such votes on the same principle among any number of candidates.

SECTION 13. Inspectors of Election. In advance of any meeting of shareholders, the board of directors may appoint any persons other than nominees for office as inspectors of election to act at such meeting or any adjournment. The number of inspectors shall be either one or three. Any such appointment shall not be altered at the meeting. If inspectors of election are not so appointed, the chairman of the board or one of the presidents may, or on the request of not fewer than 10 percent of the votes represented at the meeting shall, make such appointment at the meeting. If appointed at the meeting, the majority of the votes present shall determine whether one or three inspectors are to be appointed. In case any person appointed as inspector fails to appear or fails or refuses to act, the vacancy may be filled by appointment by the board of directors in advance of the meeting or at the meeting by the chairman of the board or one of the presidents.

Unless otherwise prescribed by regulations of the OTS, the duties of such inspectors shall include: determining the number of shares and the voting power of each share, the shares represented at the meeting, the existence of a quorum, and the authenticity, validity and effect of proxies; receiving votes, ballots or consents; hearing and determining all challenges and questions in any way arising in connection with the rights to vote; counting and tabulating all votes or consents; determining the result; and such acts as may be proper to conduct the election or vote with fairness to all shareholders.

SECTION 14. Director Elections. The board of directors may nominate candidates for election as directors. Ballots bearing the names of all persons nominated by the board of directors and by shareholders shall be provided for use at the annual meeting. However, if the board of directors shall fail or refuse to act at least 20 days prior to the annual meeting, nominations for directors may be made at the annual meeting by any shareholder entitled to vote and shall be voted upon.

SECTION 15. New Business. Any new business to be taken up at the annual meeting shall be stated in writing and filed with the secretary of the savings bank at least five days before the annual meeting, and all business so stated, proposed and filed shall be considered at the annual meeting; but no other proposal shall be acted upon at the annual meeting. Any shareholder may make any other proposal at the annual meeting and the same may be discussed and considered, but unless stated in writing and filed with the secretary at least five days before the meeting, such proposal shall be laid over for action at an adjourned, special or annual meeting of the shareholders taking place 30 days or more thereafter. This provision shall not prevent the consideration and approval or disapproval at the annual meeting of reports of officers, directors, and committees; but in connection with such reports, no new business shall be acted upon at such annual meeting unless stated and filed as herein provided.

SECTION 16. Informal Action by Shareholders. Any action required to be taken at a meeting of the shareholders, or any other action which may be taken at a meeting of the shareholders, may be taken without a meeting if consent in writing, setting forth the action so taken, shall be given by all shareholders entitled to vote with respect to the subject matter.

ARTICLE III — BOARD OF DIRECTORS

SECTION 1. General Powers. The business and affairs of this savings bank shall be under the direction of its board of directors. The board of directors shall annually elect a chairman of the board and one or more presidents and shall designate, when present, either the chairman of the board, one of the presidents, an executive vice president, a senior vice president, or a vice president to preside at its meetings.

SECTION 2. Number and Term. The board of directors shall consist of six members. The directors shall be elected annually, and shall serve for the ensuing year and until their respective successors are duly elected and qualified.

SECTION 3. Regular and Special Meetings. Regular and special meetings of the board of directors may be called by or at the request of the chairman of the board, one of the presidents or one-third of the directors. The persons authorized to call meetings of the board of directors may fix any place as the place for holding that meeting.

Members of the board of directors may participate in regular or special meetings by means of conference telephone or similar communications equipment by which all persons participating in the meeting can hear each other. Such participation shall constitute presence in person and, if the board of directors so determines, shall constitute attendance for purpose of entitlement to compensation pursuant to Section 11 of this Article.

SECTION 4. Qualification. Each director shall at all times be the beneficial owner of not less than 100 shares of capital stock of the savings bank unless the savings bank is a wholly owned subsidiary of a holding company.

SECTION 5. Notice. Written notice of any special meeting shall be given to each director at least two days prior thereto when delivered personally or by telegram or at least five days prior thereto when delivered by mail at the address at which the director is most likely to be reached. Such notice shall be deemed to be delivered when deposited in the mail so addressed, with postage prepaid if mailed or when delivered to the telegraph company if sent by telegram. Any director may waive notice of any meeting by a writing filed with the secretary. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any meeting of the board of directors need to be specified in the notice or waiver of notice of such meeting.

SECTION 6. Quorum. A majority of the number of directors fixed by Section 2 of this Article III shall constitute a quorum for the transaction of business at any meeting of the board of directors; but if less than such majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time. Notice of any adjourned meeting shall be given in the same manner as prescribed by Section 5 of this Article III.

SECTION 7. Manner of Acting. The act of a majority of the directors present at a duly convened meeting at which a quorum is present shall be the act of the board of directors, unless a greater number is prescribed by the regulations of the OTS or these bylaws.

SECTION 8. Action Without a Meeting. Any action required or permitted to be taken by the board of directors at a meeting may be taken without a meeting if a consent in writing, setting forth the action so taken, is signed by all of the directors.

SECTION 9. Resignation. Any director may resign at any time by sending a written notice of such resignation to the home office of the savings bank addressed to the chairman of the board or one of the presidents. Unless otherwise specified, such resignation shall take effect upon receipt by the chairman of the board or one of the presidents. More than three consecutive absences

from regular meetings of the board of directors, unless excused by resolution of the board of directors, shall automatically constitute a resignation, effective when such resignation is accepted by the board of directors.

SECTION 10. Vacancies. Any vacancy on the board of directors may be filled by the affirmative vote of a majority of the remaining directors although less than a quorum of the board of directors. A director elected to fill a vacancy shall be elected to serve until the next election of directors by the shareholders. Any directorship to be filled by reason of an increase in the number of directors for may be filled by election by the board of directors for a term of office continuing only until the next election of directors by the shareholders.

SECTION 11. Compensation. Directors, as such, may receive a stated salary for their services. By resolution of the board of directors, a reasonable fixed sum, and reasonable expenses of attendance, if any, may be allowed for attendance, whether in person or by telephone, at any regular or special meeting of the Board of directors.

Members of either standing or special committees may be allowed such compensation for attendance, whether in person or by telephone, at committee meetings as the Board of directors may determine from time to time.

SECTION 12. Presumption of Assent. A director of the savings bank who is present at a meeting of the board of directors at which action on any savings bank matter is taken shall be presumed to have assented to the action taken unless his dissent or abstention shall be entered into the minutes of the meeting or unless he shall file a written dissent to such action with the person acting as the secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the secretary of the savings bank within five days after the date a copy of the minutes of the meeting is received. Such right to dissent shall not apply to a director who voted in favor of such action.

SECTION 13. Removal of Directors. At a meeting of shareholders called expressly for that purpose, any director may be removed for cause by a vote of the holders of a majority of the shares then entitled to vote at an election of directors. If less than the entire board is to be removed, no one of the directors may be removed if the votes cast against the removal would be sufficient to elect a director if then cumulatively voted at an election of the class of directors of which such director is a part. Whenever the holders of the shares of any class are entitled to elect one or more directors by the provisions of the charter or supplemental sections thereto, the provisions of this section shall apply, in respect to the removal of a director or directors so elected, to the vote of the holders of the outstanding shares of that class and not to the vote of the outstanding shares as a whole.

ARTICLE IV — EXECUTIVE AND OTHER COMMITTEES

SECTION 1. Appointment. The board of directors, by resolution adopted by a majority of the full board, may designate an executive committee. The designation of any committee pursuant to this Article IV and the delegation of authority shall not operate to relieve the board of directors, or any director, of any responsibility imposed by law or regulation.

SECTION 2. Authority. The executive committee, when the board of directors is not in session, shall have and may exercise all of the authority of the board of directors except to the extent, if any, that such authority shall be limited by the resolution appointing the executive committee; and except also that the executive committee shall not have the authority of the board of directors with reference to: the declaration of dividends; the amendment of the charter or bylaws of the savings bank, or recommending to the stockholders a plan of merger, consolidation or conversion; the sale, lease or other disposition of all or substantially all of the property and assets of the savings bank otherwise than in the usual and regular course of its business; a voluntary dissolution of the savings bank; a revocation of any of the foregoing; or the approval of a transaction in which any member of the executive committee, directly or indirectly, has any material beneficial interest.

SECTION 3. Tenure. Subject to the provisions of Section 8 of this Article IV, each member of the executive committee shall hold office until the next regular annual meeting of the board of directors following his or her designation and until a successor is designated as a member of the executive committee.

SECTION 4. Meetings. Regular meetings of the executive committee may be held without notice at such times and places as the executive committee may fix from time to time by resolution. Special meetings of the executive committee may be called by any member thereof upon not less than one day’s notice stating the place, date, and hour of the meeting, which notice may be written or oral. Any member of the executive committee may waive notice of any meeting and no notice of any meeting need be given to any member thereof who attends in person. The notice of a meeting of the executive committee need not state the business proposed to be transacted at the meeting.

SECTION 5. Quorum. A majority of the members of the executive committee shall constitute a quorum for the transaction of business at any meeting thereof, and action of the Executive committee must be authorized by the affirmative vote of a majority of the members present at a meeting at which a quorum is present.

SECTION 6. Action Without a Meeting. Any action required or permitted to be taken by the executive committee at a meeting may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by all of the members of the executive committee.

SECTION 7. Vacancies. Any vacancy in the executive committee may be filled by a resolution adopted by a majority of the full board of directors.

SECTION 8. Resignations and Removal. Any member of the executive committee may be removed at any time with or without cause by a resolution adopted by a majority of the full board of directors. Any member of the executive committee may resign from the executive committee at any time by giving written notice to the one of the presidents or secretary of the savings bank. Unless otherwise specified, such resignation shall take effect upon its receipt; the acceptance of such resignation shall not be necessary to make it effective.

SECTION 9. Procedure. The executive committee shall elect a presiding officer from its members and may fix its own rules of procedure which shall not be inconsistent with these bylaws. It shall keep regular minutes of its proceedings and report the same to the board of directors for its information at the meeting held next after the proceedings shall have occurred

SECTION 10. Other Committees. The board of directors may by resolution establish an audit, loan or other committee composed of directors as they may determine to be necessary or appropriate for the conduct of the business of the savings bank and may prescribe the duties, constitution, and procedures thereof.

ARTICLE V — OFFICERS

SECTION 1. Positions. The officers of this savings bank shall be one or more presidents, one or more vice presidents, a secretary and a treasurer, each of whom shall be elected by the board of directors. The board of directors may also designate the chairman of the board as an officer. One of the presidents shall be the chief executive officer, unless the board of directors designates the chairman of the board as chief executive officer. The offices of secretary and treasurer may be held by the same person and a vice president may also be either the secretary or the treasurer. The board of directors may designate one or more vice presidents as executive vice president or senior vice president. The board of directors also may elect or authorize the appointment of such other officers as the business of this savings bank may require. The officers shall have such authority and perform such duties as the board of directors may from time to time authorize or determine. In the absence of action by the board of directors, the officers shall have such powers and duties as generally pertain to their respective offices.

SECTION 2. Election and Term of Office. The officers of this savings bank shall be elected annually at the first meeting of the board of directors held after each annual meeting of the shareholders. If the election of officers is not held at such meeting, such election shall be held as soon thereafter as possible. Each officer shall hold office until a successor has been duly elected and qualified or until the officer’s death, resignation, or removal in the manner hereinafter provided. Election or appointment of an officer, employee, or agent shall not of itself create contractual rights. The board of directors may authorize the savings bank to enter into an employment contract with any officer in accordance with regulations of the OTS; but no such contract shall impair the right of the board of directors to remove any officer at any time in accordance with Section 3 of this Article V.

SECTION 3. Removal. Any officer may be removed by the board of directors whenever in its judgment the best interests of the savings bank would be served thereby, but such removal, other than for cause, shall be without prejudice to the contractual rights, if any, of the person so removed.

SECTION 4. Vacancies. A vacancy in any office because of death, resignation, removal, disqualification, or otherwise may be filled by the board of directors for the unexpired portion of the term.

SECTION 5. Remuneration. The remuneration of the officers shall be fixed from time to time by the board of directors.

ARTICLE VI — CONTRACTS, LOANS, CHECKS AND DEPOSITS

SECTION 1. Contracts. To the extent permitted by regulations of the OTS, and except as otherwise prescribed by these bylaws with respect to certificates for shares, the board of directors may authorize any officer, employee or agent of the savings bank to enter into any contract or to execute and deliver any instrument in the name of and on behalf of the savings bank. Such authority may be general or confined to specific instances.

SECTION 2. Loans. No loans shall be contracted on behalf of the savings bank and no evidence of indebtedness shall be issued in its name unless authorized by the board of directors. Such authority may be general or confined to specific instances.

SECTION 3. Checks, Drafts, etc. All checks, drafts or other orders for the payment of money, notes, or other evidences of indebtedness issued in the name of the savings bank shall be signed by one or more officers, employees or agents of the savings bank in such manner as shall from time to time be determined by the board of directors.

SECTION 4. Deposits. All funds of the savings bank not otherwise employed shall be deposited from time to time to the credit of the savings bank in any duly authorized depositories as the board of directors may select.

ARTICLE VII — CERTIFICATES FOR SHARES AND THEIR TRANSFER

SECTION 1. Certificates for Shares. Certificates representing shares of capital stock of the savings bank shall be in such form as shall be determined by the board of directors and approved by the OTS. Such certificates shall be signed by the chief executive officer or by any other officer of the savings bank authorized by the board of directors, attested by the secretary or an assistant secretary, and sealed with the corporate seal or a facsimile thereof. The signatures of such officers upon a certificate may be facsimiles if the certificate is manually signed on behalf of a transfer agent or a registrar other than the savings bank itself or one of its employees. Each certificate for shares of capital stock shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares are issued, the number of shares and date of issue, shall be entered on the stock transfer books of the savings bank. All certificates surrendered to the savings bank for transfer shall be canceled and no new certificate shall be issued until the former certificate for a like number of shares has been surrendered and canceled, except that in the case of a lost or destroyed certificate, a new certificate may be issued upon such terms and indemnity to the savings bank as the board of directors may prescribe.

SECTION 2. Transfer of Shares. Transfer of shares of the capital stock of the savings bank shall be made only on its stock transfer books. Authority for such transfer shall be given only by the holder of record or by his legal representative, who shall furnish proper evidence of such authority, or by his attorney authorized by a duly executed power of attorney and filed with the savings bank. Such transfer shall be made only on surrender for cancellation of the certificate for such shares. The person in whose name shares of capital stock stand on the books of the savings bank shall be deemed by the savings bank to be the owner for all purposes.

ARTICLE VIII — FISCAL YEAR

The fiscal year of this savings bank shall end on the 31st day of December of each year.

ARTICLE IX — DIVIDENDS

Subject to the terms of the savings bank’s charter and the regulations and orders of the OTS, the board of directors may, from time to time, declare, and the savings bank may pay, dividends on its outstanding shares of capital stock.

ARTICLE X — CORPORATE SEAL

The board of directors shall approve a savings bank seal which shall be two concentric circles between which shall be the name of the savings bank. The year of incorporation or an emblem may appear in the center.

ARTICLE XI — AMENDMENTS

These bylaws may be amended in a manner consistent with regulations of the OTS at any time by a majority of the full board of directors or by a majority vote of the votes cast by the stockholders of the savings bank at any legal meeting.

EXHIBIT 6

Section 321(b) Consent

Pursuant to Section 321(b) of the Trust Indenture Act of 1939, as amended, Wilmington Trust FSB hereby consents that reports of examinations by Federal, State, Territorial or District authorities may be furnished by such authorities to the Securities and Exchange Commission upon requests therefor.

 

    WILMINGTON TRUST FSB
Dated: June 17, 2011     By:  

/s/ Joseph P. O’Donnell

    Name:   Joseph P. O’Donnell
    Title:   Vice President

EXHIBIT 7

This form is intended to assist state nonmember banks and savings banks with state publication requirements. It has not been approved by any state banking authorities. Refer to your appropriate state banking authorities for your state publication requirements.

R E P O R T   O F   C O N D I T I O N

            WILMINGTON TRUST FSB             of     Wilmington

                  Name of Bank                                              City

in the State of   Delaware  , at the close of business on March 31, 2011:

 

ASSETS    Thousands of Dollars  

Cash, Deposits & Investment Securities:

      1,192,582   

Mortgage back Securities:

      1,074   

Mortgage Loans:

      512,298   

Non-Mortgage Loans:

      403,480   

Repossessed Assets:

      5,036   

Federal Home Loan Bank Stock

      6,008   

Office Premises and Equipment:

      16,137   

Other Assets:

      161,761   

Total Assets:

      2,298,376   
LIABILITIES    Thousands of Dollars  

Deposits

      1,869,259   

Escrows

      705   

Federal Funds Purchased and Securities Sold Under Agreements to Repurchase

      10,597   

Other Liabilities and Deferred Income:

      155,192   

Total Liabilities

      2,035,753   
EQUITY CAPITAL    Thousands of Dollars  

Common Stock

      299,529   

Unrealized Gains (Losses) on Certain Securities

      (33 ) 

Retained Earnings

      (36,873 ) 

Other Components of Equity Capital

      0   

Total Equity Capital

      262,623   

Total Liabilities and Equity Capital

      2,298,376   
 EX-99.1 48 dex991.htm EXHIBIT 99.1 Exhibit 99.1

Exhibit 99.1

Letter of Transmittal

To Tender for Exchange

9% Senior Secured Second Lien Notes due 2018

of

TOMKINS, LLC and TOMKINS, INC.

Pursuant to the Prospectus dated              , 2011

 

THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON              , 2011, UNLESS EXTENDED (SUCH TIME AND DATE, AS THE SAME MAY BE EXTENDED FROM TIME TO TIME, THE “EXPIRATION DATE”). TENDERS MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE.

The Exchange Agent is:

WILMINGTON TRUST FSB

 

By Registered Mail, Certified Mail, Overnight

Delivery or Hand Delivery:

    By Facsimile:

Wilmington Trust FSB

c/o Wilmington Trust Company

Attn: Sam Hamed

Corporate Capital Markets

Rodney Square North

1100 North Market Street

Wilmington, Delaware 19890-1626.

   

+1.302.636.4139

 

Confirm by Telephone:

 

+1.302.636.6181

DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION TO A FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.

The undersigned acknowledges receipt of the Prospectus dated              , 2011 (the “Prospectus”), of Tomkins, LLC, a Delaware limited liability company (the “LLC Co-Issuer”), and Tomkins, Inc., a Delaware corporation (the “Corporate Co-issuer” and, together with the LLC Co-Issuer, the “Issuers”), and this Letter of Transmittal (the “Letter of Transmittal”), which together with the Prospectus constitutes the Issuers’ offer (the “Exchange Offer”) to exchange an aggregate principal amount of up to $1,150,000,000 of its outstanding 9% Senior Secured Second Lien Notes due 2018, which have been registered under the Securities Act of 1933, as amended (the “Securities Act”) (the “Exchange Notes”) for an equal aggregate principal amount of its outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Initial Notes”). Recipients of the Prospectus should read the requirements described in such Prospectus with respect to eligibility to participate in the Exchange Offer. Capitalized terms used but not defined herein have the meaning given to them in the Prospectus.

The undersigned hereby tenders the Initial Notes described in the box entitled “Description of the Initial Notes” below pursuant to the terms and conditions described in the Prospectus and this Letter of Transmittal. The undersigned is the registered holder of all the Initial Notes (the “Holder”) and the undersigned represents that it has received from each beneficial owner of Initial Notes (the “Beneficial Owners”) a duly completed and executed form of “Instruction to Registered Holder from Beneficial Owner” accompanying this Letter of Transmittal, instructing the undersigned to take the action described in this Letter of Transmittal.

PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL CAREFULLY BEFORE COMPLETING ANY BOX BELOW.

This Letter of Transmittal is to be used by a Holder (i) if certificates representing Initial Notes are to be forwarded herewith and (ii) if a tender is made pursuant to the guaranteed delivery procedures in the section of the Prospectus entitled “The Exchange Offer—Procedures for Tendering Initial Notes—Guaranteed Delivery Procedures.”

Holders that are tendering by book-entry transfer to the Exchange Agent’s account at DTC can execute the tender through ATOP for which the Exchange Offer will be eligible. DTC participants that are accepting the Exchange Offer must transmit their acceptance to DTC, which will verify the acceptance and execute a book-entry delivery to the Exchange Agent’s account at DTC. DTC will then send an agent’s message forming part of a book-entry transfer in which the participant agrees to be bound by the terms of the Letter of Transmittal (an “Agent’s Message”) to the Exchange Agent for its acceptance. Transmission of the Agent’s Message by DTC will satisfy the terms of the Exchange Offer as to execution and delivery of a Letter of Transmittal by the participant identified in the Agent’s Message.

Any Beneficial Owner whose Initial Notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and who wishes to tender should contact such Holder promptly and instruct such Holder to tender on behalf of the Beneficial Owner. If such Beneficial Owner wishes to tender on its own behalf, such Beneficial Owner must, prior to completing and executing this Letter of Transmittal and delivering its Initial Notes, either make appropriate arrangements to register ownership of the Initial Notes in such Beneficial Owner’s name or obtain a properly completed bond power from the Holder. The transfer of record ownership may take considerable time.

In order to properly complete this Letter of Transmittal, a Holder must (i) complete the box entitled “Description of the Initial Notes,” (ii) if appropriate, check and complete the boxes relating to book-entry transfer, guaranteed delivery, Special Issuance Instructions and Special Delivery Instructions, and (iii) sign the Letter of Transmittal by completing the box entitled “Sign Here To Tender Your Notes.” Each Holder should carefully read the detailed instructions below prior to completing the Letter of Transmittal.

Holders of Initial Notes who desire to tender their Initial Notes for exchange and (i) whose Initial Notes are not immediately available or (ii) who cannot deliver their Initial Notes, this Letter of Transmittal and all other documents required hereby to the Exchange Agent on or prior to the Expiration Date, must tender the Initial Notes pursuant to the guaranteed delivery procedures set forth in the section of the Prospectus entitled “The Exchange Offer— Procedures for Tendering Initial Notes—Guaranteed Delivery Procedures.” See Instruction 2.

Holders of Initial Notes who wish to tender their Initial Notes for exchange must complete columns (1) through (3) in the box below entitled “Description of the Initial Notes,” and sign the box below entitled “Sign Here To Tender Your Notes.” If only those columns are completed, such Holder will have tendered for exchange all Initial Notes listed in column (3) below. If the Holder wishes to tender for exchange less than all of such Initial Notes, column (4) must be completed in full. In such case, such Holder should refer to Instruction 5.

The Exchange Offer may be extended, terminated or amended, as provided in the Prospectus. During any such extension of the Exchange Offer, all Initial Notes previously tendered and not withdrawn pursuant to the Exchange Offer will remain subject to such Exchange Offer.

The undersigned hereby tenders for exchange the Initial Notes described in the box entitled “Description of the Initial Notes” below pursuant to the terms and conditions described in the Prospectus and this Letter of Transmittal.

 

2

DESCRIPTION OF THE INITIAL NOTES   

(1)

 

Name(s) and Address(es) of Registered Holder(s)

(Please fill in, if blank)

   

(2)

 

Certificate Number(s)

     

(3)

 

Aggregate

Principal Amount
Represented by

Certificate(s)(A)

     

(4)

 

Principal Amount
Tendered For
Exchange(B)

  
       
                
       
                
       
                
       
                
       
                
       
                
       
                
      
 

 

 Total Principal
Amount Tendered

 

   
  

 

                  

(A)   Unless indicated in this column, any tendering Holder will be deemed to have tendered the entire aggregate principal amount represented by the Initial Notes indicated in the column labeled “Aggregate Principal Amount Represented by Certificate(s).” See Instruction 5.

(B)   The minimum permitted tender is $2,000 in principal amount of Initial Notes. All other tenders must be in integral multiples of $1,000.

        

       

 

 

3

¨ CHECK HERE IF TENDERED INITIAL NOTES ARE ENCLOSED HEREWITH.

 

¨ CHECK HERE IF TENDERED INITIAL NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY ENCLOSED HEREWITH AND COMPLETE THE FOLLOWING (FOR USE BY ELIGIBLE INSTITUTIONS ONLY):

Name(s) of Registered Holder(s):                                                                                                                             

Date of Execution of Notice of Guaranteed Delivery:                                                                                          

Window Ticket Number (if any):                                                                                                                              

Name of Institution that Guaranteed Delivery:                                                                                                     

Only Holders are entitled to tender their Initial Notes for exchange in the Exchange Offer. Any financial institution that is a participant in DTC’s system and whose name appears on a security position listing as the record owner of the Initial Notes and who wishes to make book-entry delivery of Initial Notes as described above must complete and execute a participant’s letter (which will be distributed to participants by DTC) instructing DTC’s nominee to tender such Initial Notes for exchange. Persons who are Beneficial Owners of Initial Notes but are not Holders and who seek to tender Initial Notes should (i) contact the Holder and instruct such Holder to tender on his or her behalf, (ii) obtain and include with this Letter of Transmittal, Initial Notes properly endorsed for transfer by the Holder or accompanied by a properly completed bond power from the Holder, with signatures on the endorsement or bond power guaranteed by a firm that is an eligible guarantor institution within the meaning of Rule 17Ad-5 under the Exchange Act, including a firm that is a member of a registered national securities exchange, a member of the National Association of Securities Dealers, Inc., a commercial bank or trading company having an office in the United States or certain other eligible guarantors (each, an “Eligible Institution”), or (iii) effect a record transfer of such Initial Notes from the Holder to such Beneficial Owner and comply with the requirements applicable to Holders for tendering Initial Notes prior to the Expiration Date. See the section of the Prospectus entitled “The Exchange Offer—Procedures for Tendering Initial Notes.”

SIGNATURES MUST BE PROVIDED BELOW.

PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.

 

 

4

SPECIAL ISSUANCE INSTRUCTIONS

(See Instructions 1, 6, 8 and 9)

To be completed ONLY (i) if the Exchange Notes issued in exchange for the Initial Notes, certificates for Initial Notes in a principal amount not exchanged for Exchange Notes, or Initial Notes (if any) not tendered for exchange, are to be issued in the name of someone other than the undersigned or (ii) if Initial Notes tendered by book-entry transfer which are not exchanged are to be returned by credit to an account maintained at DTC.

Issue to:

 

Name:                                                                                      
    (Please Type or Print)
Address:  

 

 

  (Include Zip Code)

 

        (Taxpayer Identification or Social Security No.)    

Credit Initial Notes not exchanged and delivered by book-entry transfer to DTC account set forth below:

 

                                 (Account Number)                                 

SPECIAL DELIVERY INSTRUCTIONS

(See Instructions 1, 6, 8 and 9)

To be completed ONLY if the Exchange Notes issued in exchange for Initial Notes, certificates for Initial Notes in a principal amount not exchanged for Exchange Notes, or Initial Notes (if any) not tendered for exchange, are to be mailed or delivered (i) to someone other than the undersigned or (ii) to the undersigned at an address other than the address shown below the undersigned’s signature.

Mail or deliver to:

 

Name:                                                                                      
    (Please Type or Print)
Address:  

 

 

  (Include Zip Code)

 

        (Taxpayer Identification or Social Security No.)    

 

 

 

5

Ladies and Gentlemen:

Upon the terms and subject to the conditions of the Exchange Offer, the undersigned hereby tenders to the Issuers for exchange the Initial Notes indicated above. Subject to, and effective upon, acceptance for exchange of the Initial Notes tendered for exchange herewith, the undersigned will have irrevocably sold, assigned, transferred and exchanged, to the Issuers, all right, title and interest in, to and under all of the Initial Notes tendered for exchange hereby, and hereby will have appointed the Exchange Agent as the true and lawful agent and attorney-in-fact (with full knowledge that the Exchange Agent also acts as agent of the Issuers) of such Holder with respect to such Initial Notes, with full power of substitution to (i) deliver certificates representing such Initial Notes, or transfer ownership of such Initial Notes on the account books maintained by DTC (together, in any such case, with all accompanying evidences of transfer and authenticity), to the Issuers, (ii) present and deliver such Initial Notes for transfer on the books of the Issuers and (iii) receive all benefits and otherwise exercise all rights and incidents of beneficial ownership with respect to such Initial Notes, all in accordance with the terms of the Exchange Offer. The power of attorney granted in this paragraph shall be deemed to be irrevocable and coupled with an interest.

The undersigned hereby represents and warrants that it has full power and authority to tender, exchange, assign and transfer the Initial Notes; and that when such Initial Notes are accepted for exchange by the Issuers, the Issuers will acquire good and marketable title thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any adverse claims. The undersigned further warrants that it will, upon request, execute and deliver any additional documents deemed by the Exchange Agent or the Issuers to be necessary or desirable to complete the exchange, assignment and transfer of the Initial Notes tendered for exchange hereby. The undersigned further agrees that acceptance of any and all validly tendered Initial Notes by the Issuers and the issuance of Exchange Notes in exchange therefor shall constitute performance in full by the Issuers of its obligations under the Registration Rights Agreement.

By tendering, the undersigned hereby further represents to the Issuers that (i) the Exchange Notes to be acquired by the undersigned in exchange for the Initial Notes tendered hereby and any Beneficial Owner(s) of such Initial Notes in connection with the Exchange Offer will be acquired by the undersigned and such Beneficial Owner(s) in the ordinary course of their respective businesses, (ii) neither the undersigned nor any Beneficial Owner has any arrangement or understanding with any person to participate in the distribution (within the meaning of the Securities Act) of the Exchange Notes in violation of the Securities Act and, at the time of consummation of the Exchange Offer, neither the undersigned nor any Beneficial Owner will have any such arrangement or understanding, and if such person is not a broker-dealer, such person is not engaged in, and does not intend to engage in, a distribution of the Exchange Notes, (iii) the undersigned and each Beneficial Owner acknowledge and agree that any person who is a broker-dealer registered under the Exchange Act or is participating in the Exchange Offer for the purpose of distributing the Exchange Notes must comply with the registration and prospectus delivery requirements of Section 10 of the Securities Act in connection with a secondary resale transaction of the Exchange Notes acquired by such person and cannot rely on the position of the staff of the Commission set forth in certain no-action letters, (iv) the undersigned and each Beneficial Owner understand that a secondary resale transaction described in clause (iii) above and any resales of Exchange Notes obtained by the undersigned in exchange for the Initial Notes acquired by the undersigned directly from the Issuers should be covered by an effective registration statement containing the selling securityholder information required by Item 507 or Item 508, as applicable, of Regulation S-K of the Commission, (v) neither the undersigned nor any Beneficial Owner is an “affiliate,” as defined under Rule 405 under the Securities Act, of the Issuers and (vi) neither the undersigned nor any Beneficial Owner is acting on behalf of any persons or entities who could not truthfully make the foregoing representations.

 

6

If the undersigned is a broker-dealer that will receive Exchange Notes for its own account in exchange for Initial Notes that were acquired as a result of market-making activities or other trading activities, it acknowledges that it will deliver a prospectus meeting the requirements of Section 10 of the Securities Act in connection with any resale of such Exchange Notes; however, by so acknowledging and by delivering such prospectus, the undersigned will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act. A broker-dealer may not participate in the Exchange Offer with respect to the Initial Notes acquired other than as a result of market-making activities or other trading activities.

For purposes of the Exchange Offer, the Issuers will be deemed to have accepted for exchange, and to have exchanged, validly tendered Initial Notes, if, as and when the Issuers give oral or written notice thereof to the Exchange Agent. Tenders of Secured Notes for exchange may be withdrawn at any time prior to 5:00 p.m., New York City time, on the Expiration Date. See “The Exchange Offer—Withdrawal Rights” in the Prospectus. Any Initial Notes tendered by the undersigned and not accepted for exchange will be returned to the undersigned at the address set forth above unless otherwise indicated in the box above entitled “Special Delivery Instructions” promptly after the Expiration Date.

The undersigned acknowledges that the Issuers’ acceptance of Initial Notes validly tendered for exchange pursuant to any one of the procedures described in the section of the Prospectus entitled “The Exchange Offer” and in the instructions hereto will constitute a binding agreement between the undersigned and the Issuers upon the terms and subject to the conditions of the Exchange Offer.

Unless otherwise indicated in the box entitled “Special Issuance Instructions,” please return any Initial Notes not tendered for exchange in the name(s) of the undersigned. Similarly, unless otherwise indicated in the box entitled “Special Delivery Instructions,” please mail any certificates for Initial Notes not tendered or exchanged (and accompanying documents, as appropriate) to the undersigned at the address shown below the undersigned’s signature(s). In the event that both “Special Issuance Instructions” and “Special Delivery Instructions” are completed, please issue the certificates representing the Exchange Notes issued in exchange for the Initial Notes accepted for exchange in the name(s) of, and return any Initial Notes not tendered for exchange or not exchanged to, the person(s) so indicated. The undersigned recognizes that the Issuers have no obligation pursuant to the “Special Issuance Instructions” and “Special Delivery Instructions” to transfer any Initial Notes from the name of the Holder(s) thereof if the Issuers do not accept for exchange any of the Initial Notes so tendered for exchange or if such transfer would not be in compliance with any transfer restrictions applicable to such Initial Note(s).

In order to validly tender Initial Notes for exchange, Holders must complete, execute, and deliver this Letter of Transmittal.

Except as stated in the Prospectus, all authority herein conferred or agreed to be conferred shall survive the death, incapacity or dissolution of the undersigned, and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. Except as otherwise stated in the Prospectus, this tender for exchange of Initial Notes is irrevocable.

 

7

SIGN HERE TO TENDER YOUR INITIAL NOTES

 

 

Signature(s) of Owner(s)
   
Dated:            , 2011     
 
Must be signed by the Holder(s) exactly as name(s) appear(s) on certificate(s) representing the Initial Notes or on a security position listing or by person(s) authorized to become registered Initial Note holder(s) by certificates and documents transmitted herewith. If signature is by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, please provide the following information. (See Instruction 6.)
   
Name(s):   

 

 

 

(Please Type or Print)
Capacity (full title):   

 

     

 

   
Address:   

 

 

 

(Include Zip Code)
   
Principal place of business (if different from address listed  above):   

 

     

 

 

   
Area Code and Telephone No.:   

(         ):

   
Tax Identification or Social Security Nos.:   

 

 

GUARANTEE OF SIGNATURE(S)

(Signature(s) must be guaranteed if required by Instruction 1)

 

Authorized Signature:   

 

Name and Title:   

 

 

 

(Please Type or Print)
Name of Firm:   

 

Address:   

 

Area Code and Telephone No.:   

 

Dated:   

 

 

 

8

INSTRUCTIONS

Forming Part of the Terms and Conditions of the Exchange Offer

1. Guarantee of Signatures. Except as otherwise provided below, all signatures on this Letter of Transmittal must be guaranteed by an institution which is (1) a member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., (2) a commercial bank or trust company having an office or correspondent in the United States or (3) an Eligible Institution that is a member of one of the following recognized Signature Guarantee Programs:

(a) The Securities Transfer Agents Medallion Program (STAMP);

(b) The New York Stock Exchange Medallion Signature Program (MSP); or

(c) The Stock Exchange Medallion Program (SEMP).

Signatures on this Letter of Transmittal need not be guaranteed (i) if this Letter of Transmittal is signed by the Holder(s) of the Initial Notes tendered herewith and such Holder(s) have not completed the box entitled “Special Issuance Instructions” or the box entitled “Special Delivery Instructions” on this Letter of Transmittal or (ii) if such Initial Notes are tendered for the account of an Eligible Institution. In all other cases, all signatures must be guaranteed by an Eligible Institution.

2. Delivery of this Letter of Transmittal and Initial Notes; Guaranteed Delivery Procedures. This Letter of Transmittal is to be completed by Holders if certificates representing Initial Notes are to be forwarded herewith. All physically delivered Initial Notes, as well as a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) and any other required documents, must be received by the Exchange Agent at its address set forth herein prior to the Expiration Date or the tendering Holder must comply with the guaranteed delivery procedures set forth below. Delivery of the documents to DTC does not constitute delivery to the Exchange Agent.

The method of delivery of Initial Notes, this Letter of Transmittal and all other required documents to the Exchange Agent is at the election and risk of the Holder. Except as otherwise provided below, the delivery will be deemed made only when actually received or confirmed by the Exchange Agent. Instead of delivery by mail, it is recommended that Holders use an overnight or hand delivery service, properly insured. In all cases, sufficient time should be allowed to assure delivery to the Exchange Agent before the Expiration Date. Neither this Letter of Transmittal nor any Initial Notes should be sent to the Issuers. Holders may request their respective brokers, dealers, commercial banks, trust companies or nominees to effect the above transactions for such Holders.

Holders of Initial Notes who elect to tender Initial Notes and (i) whose Initial Notes are not immediately available or (ii) who cannot deliver the Initial Notes, this Letter of Transmittal or other required documents to the Exchange Agent prior the Expiration Date must tender their Initial Notes according to the guaranteed delivery procedures set forth in the Prospectus. Holders may have such tender effected if:

(a) such tender is made through an Eligible Institution;

(b) prior to 5:00 p.m., New York City time, on the Expiration Date, the Exchange Agent has received from such Eligible Institution a properly completed and duly executed Notice of Guaranteed Delivery, setting forth the name and address of the Holder, the certificate number(s) of such Initial Notes and the principal amount of Initial Notes tendered for exchange, stating that tender is being made thereby and guaranteeing that, within three New York Stock Exchange trading days after the Expiration Date, this

 

9

Letter of Transmittal (or facsimile thereof), together with the certificate(s) representing such Initial Notes (or a Book Entry Confirmation), in proper form for transfer, and any other documents required by this Letter of Transmittal, will be deposited by such Eligible Institution with the Exchange Agent; and

(c) a properly executed Letter of Transmittal (or facsimile thereof), as well as the certificate(s) for all tendered Initial Notes in proper form for transfer or a Book-Entry Confirmation, together with any other documents required by this Letter of Transmittal, are received by the Exchange Agent within five New York Stock Exchange trading days after the Expiration Date.

No alternative, conditional or contingent tenders will be accepted. All tendering Holders, by execution of this Letter of Transmittal (or facsimile thereof), waive any right to receive notice of the acceptance of their Initial Notes for exchange.

3. Inadequate Space. If the space provided in the box entitled “Description of the Initial Notes” above is inadequate, the certificate numbers and principal amounts of the Initial Notes being tendered should be listed on a separate signed schedule affixed hereto.

4. Withdrawals. A tender of Initial Notes may be withdrawn at any time prior to the Expiration Date by delivery of written notice of withdrawal (or facsimile thereof) to the Exchange Agent at the address set forth on the cover of this Letter of Transmittal. To be effective, a notice of withdrawal of Initial Notes must (i) specify the name of the person who tendered the Initial Notes to be withdrawn (the “Depositor”), (ii) identify the Initial Notes to be withdrawn (including the certificate number(s) and aggregate principal amount of such Initial Notes), and (iii) be signed by the Holder in the same manner as the original signature on the Letter of Transmittal by which such Initial Notes were tendered (including any required signature guarantees). All questions as to the validity, form and eligibility (including time of receipt) of such notices will be determined by the Company in its sole discretion, whose determination shall be final and binding on all parties. Any Initial Notes so withdrawn will thereafter be deemed not validly tendered for purposes of the Exchange Offer and no Exchange Notes will be issued with respect thereto unless the Initial Notes so withdrawn are validly retendered. Properly withdrawn Initial Notes may be retendered by following one of the procedures described in the section of the Prospectus entitled “The Exchange Offer—Procedures for Tendering Initial Notes” at any time prior to the Expiration Date

5. Partial Tenders. Tenders of Initial Notes will be accepted only in minimum denominations of $2,000 principal amount and integral multiples of $1,000 in excess thereof. If a tender for exchange is to be made with respect to less than the entire principal amount of any Initial Notes, fill in the principal amount of the Initial Notes which are tendered for exchange in column (4) of the box entitled “Description of the Initial Notes,” as more fully described in the footnotes thereto. In the case of a partial tender for exchange, a new certificate, in fully registered form, for the remainder of the principal amount of the Initial Notes, will be sent to the Holders unless otherwise indicated in the appropriate box on this Letter of Transmittal promptly after the expiration or termination of the Exchange Offer.

6. Signatures on this Letter of Transmittal, Powers of Attorney and Endorsements.

(a) The signature(s) of the Holder on this Letter of Transmittal must correspond with the name(s) as written on the face of the Initial Notes without alteration, enlargement or any change whatsoever.

(b) If tendered Initial Notes are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal.

(c) If any tendered Initial Notes are registered in different names on several certificates, it will be necessary to complete, sign and submit as many separate copies of this Letter of Transmittal and any necessary or required documents as there are different registrations or certificates.

 

10

(d) When this Letter of Transmittal is signed by the Holder listed and transmitted hereby, no endorsements of Initial Notes or bond powers are required. If, however, Initial Notes not tendered or not accepted, are to be issued or returned in the name of a person other than the Holder, then the Initial Notes transmitted hereby must be endorsed or accompanied by a properly completed bond power, in a form satisfactory to the Issuers, in either case signed exactly as the name(s) of the Holder(s) appear(s) on the Initial Notes. Signatures on such Initial Notes or bond powers must be guaranteed by an Eligible Institution (unless signed by an Eligible Institution).

(e) If this Letter of Transmittal or Initial Notes or bond powers are signed by trustees, executors, administrators, guardians, attorneys in fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and unless waived by the Issuers, evidence satisfactory to the Issuers of their authority to so act must be submitted with this Letter of Transmittal.

7. Transfer Taxes. Except as set forth in this Instruction 8, the Issuers will pay all transfer taxes, if any, applicable to the exchange of Initial Notes pursuant to the Exchange Offer. If, however, a transfer tax is imposed for any reason other than the exchange of Initial Notes pursuant to the Exchange Offer, then the amount of such transfer taxes (whether imposed on the Holder or any other persons) will be payable by the tendering Holder. If satisfactory evidence of payment of such taxes or exemptions therefrom is not submitted with this Letter of Transmittal, the amount of such transfer taxes will be billed directly to such tendering Holder.

Except as provided in this Instruction 8, it will not be necessary for transfer tax stamps to be affixed to the Initial Notes specified in this Letter or for funds to cover such stamps to be provided with.

8. Special Issuance and Delivery Instructions. If the Exchange Notes are to be issued, or if any Initial Notes not tendered for exchange are to be issued or sent to someone other than the Holder or to an address other than that shown above, the appropriate boxes on this Letter of Transmittal should be completed. Holders of Initial Notes tendering Initial Notes by book-entry transfer may request that Initial Notes not accepted be credited to such account maintained at DTC as such Holder may designate.

9. Irregularities. All questions as to the validity, form, eligibility (including time of receipt), compliance with conditions, acceptance and withdrawal of tendered Initial Notes will be determined by the Issuers in their sole discretion, which determination shall be final and binding. The Issuers reserve the absolute right to reject any and all Initial Notes not properly tendered or any Initial Notes the Issuers’ acceptance of which would, in the opinion of counsel for the Issuers, be unlawful. The Issuers also reserve the right to waive any defects, irregularities or conditions of tender as to particular Initial Notes. The Issuers’ interpretation of the terms and conditions of the Exchange Offer (including the instructions in this Letter of Transmittal) will be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of Initial Notes must be cured within such time as the Issuers shall determine. Although the Issuers intend to notify Holders of defects or irregularities with respect to tenders of Initial Notes, neither the Issuers, the Exchange Agent nor any other person shall incur any liability for failure to give such notification. Tenders of Initial Notes will not be deemed to have been made until such defects or irregularities have been cured or waived. Any Initial Notes received by the Exchange Agent that are not properly tendered and as to which the defects or irregularities have not been cured or waived will be returned by the Exchange Agent to the tendering holders, unless otherwise provided in this Letter of Transmittal, promptly following the Expiration Date.

10. Waiver of Conditions. The Issuers reserve the absolute right to waive, amend or modify certain of the specified conditions as described under “The Exchange Offer—Conditions to the Exchange Offer” in the Prospectus in the case of any Initial Notes tendered (except as otherwise provided in the Prospectus).

 

11

11. Mutilated, Lost, Stolen or Destroyed Initial Notes. Any tendering Holder whose Initial Notes have been mutilated, lost, stolen or destroyed, should contact the Exchange Agent at the address indicated herein for further instructions.

12. Requests for Information or Additional Copies. Requests for information, questions related to the procedures for tendering or for additional copies of the Prospectus and this Letter of Transmittal may be directed to the Exchange Agent at the address or telephone number set forth on the cover of this Letter of Transmittal.

13. Certain Tax Consequences. This Letter of Transmittal does not provide any tax disclosure to the Holders of Initial Notes or Exchange Notes. You should consult your tax advisor regarding the federal income tax consequences of the Exchange Offer, as well as tax consequences under any applicable state, local and foreign tax laws. Notwithstanding the foregoing, you should understand that the Issuers will comply with all income tax and withholding requirements that apply to consideration received by Holders with respect to the Exchange Notes. All Holders should consult the “Material U.S. Federal Income Tax Considerations” section of the Prospectus.

IMPORTANT: This Letter of Transmittal (or a facsimile thereof) together with certificates, or confirmation of book-entry or the Notice of Guaranteed Delivery, and all other required documents must be received by the Exchange Agent prior the Expiration Date.

 

12

Form W-9

(Rev. January 2011)

Department of the Treasury

Internal Revenue Service

  

Request for Taxpayer

Identification Number and Certification

 

  

Give Form to the

requester. Do not

send to the IRS.

LOGO  

Name (as shown on your income tax return)

 

 

Business name/disregarded entity name, if different from above

 

 

Check appropriate box for federal tax

 

  
  classification (required):   ¨ Individual/sole proprietor   ¨ C Corporation   ¨ S Corporation   ¨ Partnership   ¨  Trust/estate      

 

¨ Exempt payee

 

  ¨  Limited liability company. Enter the tax classification (C=C corporation, S=S corporation, P=partnership) u ---------------------------------  
 

 

¨  Other (see instructions) u

    
 

Address (number, street, and apt. or suite no.)

 

  

Requester’s name and address (optional)

 

 

City, state, and ZIP code

 

      
 

List account number(s) here (optional)

 

  Part I         Taxpayer Identification Number (TIN)

 

Enter your TIN in the appropriate box. The TIN provided must match the name given on the “Name” line to avoid backup withholding. For individuals, this is your social security number (SSN). However, for a resident alien, sole proprietor, or disregarded entity, see the Part I instructions on page 3. For other entities, it is your employer identification number (EIN). If you do not have a number, see How to get a TIN on page 3.    Social security number
                                              
                  -              -                    
                                                  
                                
Note. If the account is in more than one name, see the chart on page 4 for guidelines on whose number to enter.    Employer identification number   
       
             -                                      
                                                  

 

  Part II         Certification

Under penalties of perjury, I certify that:

 

1. The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me), and

 

2. I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding, and

 

3. I am a U.S. citizen or other U.S. person (defined below).

Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the instructions on page 4.

 

Sign    

Here  

  

Signature of

U.S. person u

    Date u

General Instructions

Section references are to the Internal Revenue Code unless otherwise noted.

Purpose of Form

A person who is required to file an information return with the IRS must obtain your correct taxpayer identification number (TIN) to report, for example, income paid to you, real estate transactions, mortgage interest you paid, acquisition or abandonment of secured property, cancellation of debt, or contributions you made to an IRA.

Use Form W-9 only if you are a U.S. person (including a resident alien), to provide your correct TIN to the person requesting it (the requester) and, when applicable, to:

1. Certify that the TIN you are giving is correct (or you are waiting for a number to be issued),

2. Certify that you are not subject to backup withholding, or

3. Claim exemption from backup withholding if you are a U.S. exempt payee. If applicable, you are also certifying that as a U.S. person, your allocable share of any partnership income from a U.S. trade or business is not subject to the withholding tax on foreign partners’ share of effectively connected income.

Note. If a requester gives you a form other than Form W-9 to request your TIN, you must use the requester’s form if it is substantially similar to this Form W-9.

Definition of a U.S. person. For federal tax purposes, you are considered a U.S. person if you are:

 

•  

An individual who is a U.S. citizen or U.S. resident alien,

 

•  

A partnership, corporation, company, or association created or organized in the United States or under the laws of the United States,

 

•  

An estate (other than a foreign estate), or

 

•  

A domestic trust (as defined in Regulations section 301.7701-7).

Special rules for partnerships. Partnerships that conduct a trade or business in the United States are generally required to pay a withholding tax on any foreign partners’ share of income from such business. Further, in certain cases where a Form W-9 has not been received, a partnership is required to presume that a partner is a foreign person, and pay the withholding tax. Therefore, if you are a U.S. person that is a partner in a partnership conducting a trade or business in the United States, provide Form W-9 to the partnership to establish your U.S. status and avoid withholding on your share of partnership income.

 

 

    Cat. No. 10231X   Form W-9 (Rev. 1-2011)

Form W-9 (Rev. 1-2011)   Page 2

 

The person who gives Form W-9 to the partnership for purposes of establishing its U.S. status and avoiding withholding on its allocable share of net income from the partnership conducting a trade or business in the United States is in the following cases:

 

•  

The U.S. owner of a disregarded entity and not the entity,

 

•  

The U.S. grantor or other owner of a grantor trust and not the trust, and

 

•  

The U.S. trust (other than a grantor trust) and not the beneficiaries of the trust.

Foreign person. If you are a foreign person, do not use Form W-9. Instead, use the appropriate Form W-8 (see Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities).

Nonresident alien who becomes a resident alien. Generally, only a nonresident alien individual may use the terms of a tax treaty to reduce or eliminate U.S. tax on certain types of income. However, most tax treaties contain a provision known as a “saving clause.” Exceptions specified in the saving clause may permit an exemption from tax to continue for certain types of income even after the payee has otherwise become a U.S. resident alien for tax purposes.

If you are a U.S. resident alien who is relying on an exception contained in the saving clause of a tax treaty to claim an exemption from U.S. tax on certain types of income, you must attach a statement to Form W-9 that specifies the following five items:

1. The treaty country. Generally, this must be the same treaty under which you claimed exemption from tax as a nonresident alien.

2. The treaty article addressing the income.

3. The article number (or location) in the tax treaty that contains the saving clause and its exceptions.

4. The type and amount of income that qualifies for the exemption from tax.

5. Sufficient facts to justify the exemption from tax under the terms of the treaty article.

        Example. Article 20 of the U.S.-China income tax treaty allows an exemption from tax for scholarship income received by a Chinese student temporarily present in the United States. Under U.S. law, this student will become a resident alien for tax purposes if his or her stay in the United States exceeds 5 calendar years. However, paragraph 2 of the first Protocol to the U.S.-China treaty (dated April 30, 1984) allows the provisions of Article 20 to continue to apply even after the Chinese student becomes a resident alien of the United States. A Chinese student who qualifies for this exception (under paragraph 2 of the first protocol) and is relying on this exception to claim an exemption from tax on his or her scholarship or fellowship income would attach to Form W-9 a statement that includes the information described above to support that exemption.

If you are a nonresident alien or a foreign entity not subject to backup withholding, give the requester the appropriate completed Form W-8.

What is backup withholding? Persons making certain payments to you must under certain conditions withhold and pay to the IRS a percentage of such payments. This is called “backup withholding.” Payments that may be subject to backup withholding include interest, tax-exempt interest, dividends, broker and barter exchange transactions, rents, royalties, nonemployee pay, and certain payments from fishing boat operators. Real estate transactions are not subject to backup withholding.

You will not be subject to backup withholding on payments you receive if you give the requester your correct TIN, make the proper certifications, and report all your taxable interest and dividends on your tax return.

Payments you receive will be subject to backup withholding if:

1. You do not furnish your TIN to the requester,

2. You do not certify your TIN when required (see the Part II instructions on page 3 for details),

3. The IRS tells the requester that you furnished an incorrect TIN,

4. The IRS tells you that you are subject to backup withholding because you did not report all your interest and dividends on your tax return (for reportable interest and dividends only), or

5. You do not certify to the requester that you are not subject to backup withholding under 4 above (for reportable interest and dividend accounts opened after 1983 only).

Certain payees and payments are exempt from backup withholding. See the instructions below and the separate Instructions for the Requester of Form W-9.

Also see Special rules for partnerships on page 1.

Updating Your Information

You must provide updated information to any person to whom you claimed to be an exempt payee if you are no longer an exempt payee and anticipate receiving reportable payments in the future from this person. For example, you may need to provide updated information if you are a C corporation that elects to be an S corporation, or if you no longer are tax exempt. In addition, you must furnish a new Form W-9 if the name or TIN changes for the account, for example, if the grantor of a grantor trust dies.

Penalties

Failure to furnish TIN. If you fail to furnish your correct TIN to a requester, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect.

Civil penalty for false information with respect to withholding. If you make a false statement with no reasonable basis that results in no backup withholding, you are subject to a $500 penalty.

Criminal penalty for falsifying information. Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment.

Misuse of TINs. If the requester discloses or uses TINs in violation of federal law, the requester may be subject to civil and criminal penalties.

Specific Instructions

Name

If you are an individual, you must generally enter the name shown on your income tax return. However, if you have changed your last name, for instance, due to marriage without informing the Social Security Administration of the name change, enter your first name, the last name shown on your social security card, and your new last name.

If the account is in joint names, list first, and then circle, the name of the person or entity whose number you entered in Part I of the form.

Sole proprietor. Enter your individual name as shown on your income tax return on the “Name” line. You may enter your business, trade, or “doing business as (DBA)” name on the “Business name/disregarded entity name” line.

Partnership, C Corporation, or S Corporation. Enter the entity’s name on the “Name” line and any business, trade, or “doing business as (DBA) name” on the “Business name/disregarded entity name” line.

Disregarded entity. Enter the owner’s name on the “Name” line. The name of the entity entered on the “Name” line should never be a disregarded entity. The name on the “Name” line must be the name shown on the income tax return on which the income will be reported. For example, if a foreign LLC that is treated as a disregarded entity for U.S. federal tax purposes has a domestic owner, the domestic owner’s name is required to be provided on the “Name” line. If the direct owner of the entity is also a disregarded entity, enter the first owner that is not disregarded for federal tax purposes. Enter the disregarded entity’s name on the “Business name/disregarded entity name” line. If the owner of the disregarded entity is a foreign person, you must complete an appropriate Form W-8.

Note. Check the appropriate box for the federal tax classification of the person whose name is entered on the “Name” line (Individual/sole proprietor, Partnership, C Corporation, S Corporation, Trust/estate).

Limited Liability Company (LLC). If the person identified on the “Name” line is an LLC, check the “Limited liability company” box only and enter the appropriate code for the tax classification in the space provided. If you are an LLC that is treated as a partnership for federal tax purposes, enter “P” for partnership. If you are an LLC that has filed a Form 8832 or a Form 2553 to be taxed as a corporation, enter “C” for C corporation or “S” for S corporation. If you are an LLC that is disregarded as an entity separate from its owner under Regulation section 301.7701-3 (except for employment and excise tax), do not check the LLC box unless the owner of the LLC (required to be identified on the “Name” line) is another LLC that is not disregarded for federal tax purposes. If the LLC is disregarded as an entity separate from its owner, enter the appropriate tax classification of the owner identified on the “Name” line.

 

Form W-9 (Rev. 1-2011)   Page 3

 

Other entities. Enter your business name as shown on required federal tax documents on the “Name” line. This name should match the name shown on the charter or other legal document creating the entity. You may enter any business, trade, or DBA name on the “Business name/ disregarded entity name” line.

Exempt Payee

If you are exempt from backup withholding, enter your name as described above and check the appropriate box for your status, then check the “Exempt payee” box in the line following the “Business name/ disregarded entity name,” sign and date the form.

Generally, individuals (including sole proprietors) are not exempt from backup withholding. Corporations are exempt from backup withholding for certain payments, such as interest and dividends.

Note. If you are exempt from backup withholding, you should still complete this form to avoid possible erroneous backup withholding.

The following payees are exempt from backup withholding:

1. An organization exempt from tax under section 501(a), any IRA, or a custodial account under section 403(b)(7) if the account satisfies the requirements of section 401(f)(2),

2. The United States or any of its agencies or instrumentalities,

3. A state, the District of Columbia, a possession of the United States, or any of their political subdivisions or instrumentalities,

4. A foreign government or any of its political subdivisions, agencies, or instrumentalities, or

5. An international organization or any of its agencies or instrumentalities.

Other payees that may be exempt from backup withholding include:

6. A corporation,

7. A foreign central bank of issue,

8. A dealer in securities or commodities required to register in the United States, the District of Columbia, or a possession of the United States,

9. A futures commission merchant registered with the Commodity Futures Trading Commission,

10. A real estate investment trust,

11. An entity registered at all times during the tax year under the Investment Company Act of 1940,

12. A common trust fund operated by a bank under section 584(a),

13. A financial institution,

14. A middleman known in the investment community as a nominee or custodian, or

15. A trust exempt from tax under section 664 or described in section 4947.

The following chart shows types of payments that may be exempt from backup withholding. The chart applies to the exempt payees listed above, 1 through 15.

 

IF the payment is for    THEN the payment is exempt for
Interest and dividend payments    All exempt payees except for 9
Broker transactions    Exempt payees 1 through 5 and 7 through 13. Also, C corporations.
Barter exchange transactions and patronage dividends    Exempt payees 1 through 5
Payments over $600 required to be reported and direct sales over $5,000 1    Generally, exempt payees 1 through 7 2

 

1 

See Form 1099-MISC, Miscellaneous Income, and its instructions.

2 

However, the following payments made to a corporation and reportable on Form 1099-MISC are not exempt from backup withholding: medical and health care payments, attorneys’ fees, gross proceeds paid to an attorney, and payments for services paid by a federal executive agency.

Part I. Taxpayer Identification Number (TIN)

Enter your TIN in the appropriate box. If you are a resident alien and you do not have and are not eligible to get an SSN, your TIN is your IRS individual taxpayer identification number (ITIN). Enter it in the social security number box. If you do not have an ITIN, see How to get a TIN below.

If you are a sole proprietor and you have an EIN, you may enter either your SSN or EIN. However, the IRS prefers that you use your SSN.

If you are a single-member LLC that is disregarded as an entity separate from its owner (see Limited Liability Company (LLC) on page 2), enter the owner’s SSN (or EIN, if the owner has one). Do not enter the disregarded entity’s EIN. If the LLC is classified as a corporation or partnership, enter the entity’s EIN.

Note. See the chart on page 4 for further clarification of name and TIN combinations.

How to get a TIN. If you do not have a TIN, apply for one immediately. To apply for an SSN, get Form SS-5, Application for a Social Security Card, from your local Social Security Administration office or get this form online at www.ssa.gov. You may also get this form by calling 1-800-772-1213. Use Form W-7, Application for IRS Individual Taxpayer Identification Number, to apply for an ITIN, or Form SS-4, Application for Employer Identification Number, to apply for an EIN. You can apply for an EIN online by accessing the IRS website at www.irs.gov/businesses and clicking on Employer Identification Number (EIN) under Starting a Business. You can get Forms W-7 and SS-4 from the IRS by visiting IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676).

If you are asked to complete Form W-9 but do not have a TIN, write “Applied For” in the space for the TIN, sign and date the form, and give it to the requester. For interest and dividend payments, and certain payments made with respect to readily tradable instruments, generally you will have 60 days to get a TIN and give it to the requester before you are subject to backup withholding on payments. The 60-day rule does not apply to other types of payments. You will be subject to backup withholding on all such payments until you provide your TIN to the requester.

Note. Entering “Applied For” means that you have already applied for a TIN or that you intend to apply for one soon.

Caution: A disregarded domestic entity that has a foreign owner must use the appropriate Form W-8.

Part II. Certification

To establish to the withholding agent that you are a U.S. person, or resident alien, sign Form W-9. You may be requested to sign by the withholding agent even if item 1, below, and items 4 and 5 on page 4 indicate otherwise.

For a joint account, only the person whose TIN is shown in Part I should sign (when required). In the case of a disregarded entity, the person identified on the “Name” line must sign. Exempt payees, see Exempt Payee on page 3.

Signature requirements. Complete the certification as indicated in items 1 through 3, below, and items 4 and 5 on page 4.

1. Interest, dividend, and barter exchange accounts opened before 1984 and broker accounts considered active during 1983. You must give your correct TIN, but you do not have to sign the certification.

2. Interest, dividend, broker, and barter exchange accounts opened after 1983 and broker accounts considered inactive during 1983. You must sign the certification or backup withholding will apply. If you are subject to backup withholding and you are merely providing your correct TIN to the requester, you must cross out item 2 in the certification before signing the form.

3. Real estate transactions. You must sign the certification. You may cross out item 2 of the certification.

 

Form W-9 (Rev. 1-2011)   Page 4

 

4. Other payments. You must give your correct TIN, but you do not have to sign the certification unless you have been notified that you have previously given an incorrect TIN. “Other payments” include payments made in the course of the requester’s trade or business for rents, royalties, goods (other than bills for merchandise), medical and health care services (including payments to corporations), payments to a nonemployee for services, payments to certain fishing boat crew members and fishermen, and gross proceeds paid to attorneys (including payments to corporations).

5. Mortgage interest paid by you, acquisition or abandonment of secured property, cancellation of debt, qualified tuition program payments (under section 529), IRA, Coverdell ESA, Archer MSA or HSA contributions or distributions, and pension distributions. You must give your correct TIN, but you do not have to sign the certification.

 

What Name and Number To Give the Requester
For this type of account:    Give name and SSN of:

1.       Individual

    The individual
 

2.       Two or more individuals (joint

    The actual owner of the account or,

account)

    if combined funds, the first
     individual on the account 1
 

3.       Custodian account of a minor

    The minor 2

(Uniform Gift to Minors Act)

   
 

4.       a. The usual revocable savings

    The grantor-trustee 1

trust (grantor is also trustee)b. So-called trust account that is

    The actual owner 1

not a legal or valid trust under state law

   
 

5.       Sole proprietorship or disregarded

    The owner 3

entity owned by an individual

   
 

6.       Grantor trust filing under Optional Form 1099 Filing Method 1 (see Regulation section 1.671-4(b)(2)(i)(A))

    The grantor*
For this type of account:    Give name and EIN of:

7.       Disregarded entity not owned by an

    The owner

individual

   
 

8.       A valid trust, estate, or pension trust

    Legal entity 4
 

9.       Corporation or LLC electing

    The corporation

corporate status on Form 8832 or

   

Form 2553

   
 

10.     Association, club, religious,

    The organization

charitable, educational, or other tax-exempt organization

   
 

11.     Partnership or multi-member LLC

    The partnership
 

12.     A broker or registered nominee

    The broker or nominee
 

13.     Account with the Department of

    The public entity

Agriculture in the name of a public entity (such as a state or local government, school district, or prison) that receives agricultural program payments

   
 

14.     Grantor trust filing under the Form

    The trust

1041 Filing Method or the Optional

   

Form 1099 Filing Method 2 (see

   

Regulation section 1.671-4(b)(2)(i)(B))

   

 

1 

List first and circle the name of the person whose number you furnish. If only one person on a joint account has an SSN, that person’s number must be furnished.

 

2 

Circle the minor’s name and furnish the minor’s SSN.

 

3 

You must show your individual name and you may also enter your business or “DBA” name on the “Business name/disregarded entity” name line. You may use either your SSN or EIN (if you have one), but the IRS encourages you to use your SSN.

 

4 

List first and circle the name of the trust, estate, or pension trust. (Do not furnish the TIN of the personal representative or trustee unless the legal entity itself is not designated in the account title.) Also see Special rules for partnerships on page 1.

 

* Note. Grantor also must provide a Form W-9 to trustee of trust.

Note. If no name is circled when more than one name is listed, the number will be considered to be that of the first name listed.

Secure Your Tax Records from Identity Theft

Identity theft occurs when someone uses your personal information such as your name, social security number (SSN), or other identifying information, without your permission, to commit fraud or other crimes. An identity thief may use your SSN to get a job or may file a tax return using your SSN to receive a refund.

To reduce your risk:

 

•  

Protect your SSN,

 

•  

Ensure your employer is protecting your SSN, and

 

•  

Be careful when choosing a tax preparer.

If your tax records are affected by identity theft and you receive a notice from the IRS, respond right away to the name and phone number printed on the IRS notice or letter.

If your tax records are not currently affected by identity theft but you think you are at risk due to a lost or stolen purse or wallet, questionable credit card activity or credit report, contact the IRS Identity Theft Hotline at 1-800-908-4490 or submit Form 14039.

For more information, see Publication 4535, Identity Theft Prevention and Victim Assistance.

Victims of identity theft who are experiencing economic harm or a system problem, or are seeking help in resolving tax problems that have not been resolved through normal channels, may be eligible for Taxpayer Advocate Service (TAS) assistance. You can reach TAS by calling the TAS toll-free case intake line at 1-877-777-4778 or TTY/TDD 1-800-829-4059.

Protect yourself from suspicious emails or phishing schemes. Phishing is the creation and use of email and websites designed to mimic legitimate business emails and websites. The most common act is sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft.

The IRS does not initiate contacts with taxpayers via emails. Also, the IRS does not request personal detailed information through email or ask taxpayers for the PIN numbers, passwords, or similar secret access information for their credit card, bank, or other financial accounts.

        If you receive an unsolicited email claiming to be from the IRS, forward this message to phishing@irs.gov. You may also report misuse of the IRS name, logo, or other IRS property to the Treasury Inspector General for Tax Administration at 1-800-366-4484. You can forward suspicious emails to the Federal Trade Commission at: spam@uce.gov or contact them at www.ftc.gov/idtheft or 1-877-IDTHEFT (1-877-438-4338).

Visit IRS.gov to learn more about identity theft and how to reduce your risk.

 

 

Privacy Act Notice

Section 6109 of the Internal Revenue Code requires you to provide your correct TIN to persons (including federal agencies) who are required to file information returns with the IRS to report interest, dividends, or certain other income paid to you; mortgage interest you paid; the acquisition or abandonment of secured property; the cancellation of debt; or contributions you made to an IRA, Archer MSA, or HSA. The person collecting this form uses the information on the form to file information returns with the IRS, reporting the above information. Routine uses of this information include giving it to the Department of Justice for civil and criminal litigation and to cities, states, the District of Columbia, and U.S. possessions for use in administering their laws. The information also may be disclosed to other countries under a treaty, to federal and state agencies to enforce civil and criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. You must provide your TIN whether or not you are required to file a tax return. Under section 3406, payers must generally withhold a percentage of taxable interest, dividend, and certain other payments to a payee who does not give a TIN to the payer. Certain penalties may also apply for providing false or fraudulent information.

EX-99.2 49 dex992.htm EXHIBIT 99.2 Exhibit 99.2

Exhibit 99.2

Notice of Guaranteed Delivery

With Respect to Tender of

Any and All Outstanding 9% Senior Secured Second Lien Notes due 2018

for

9% Senior Secured Second Lien Notes due 2018

of

TOMKINS, LLC AND TOMKINS, INC.

Pursuant to the Prospectus dated             , 2011

 

THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON             , 2011, UNLESS EXTENDED (SUCH TIME AND DATE, AS THE SAME MAY BE EXTENDED FROM TIME TO TIME, THE “EXPIRATION DATE”). TENDERS MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE.

The Exchange Agent is:

WILMINGTON TRUST FSB

 

By Registered Mail, Certified Mail, Overnight

Delivery or Hand Delivery:

 

   

By Facsimile:

 

Wilmington Trust FSB

c/o Wilmington Trust Company

Attn: Sam Hamed

Corporate Capital Markets

Rodney Square North

1100 North Market Street

Wilmington, Delaware 19890-1626.

   

+1.302.636.4139

 

Confirm by Telephone:

 

+1.302.636.6181

DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION TO A FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.

As set forth in the prospectus (the “Prospectus”) dated             , 2011 of Tomkins, LLC, a Delaware limited liability company (the “LLC Co-Issuer”), and Tomkins, Inc., a Delaware corporation (the “Corporate Co-issuer” and, together with the LLC Co-Issuer, the “Issuers”) and in the accompanying Letter of Transmittal and instructions thereto (the “Letter of Transmittal”), this form or one substantially equivalent thereto must be used to accept the Issuers’ offer (the “Exchange Offer”) to exchange an aggregate principal amount of up to $1,150,000,000 of its outstanding 9% Senior Secured Second Lien Notes due 2018, which have been registered under the Securities Act of 1933, as amended (the “Securities Act”) (the “Exchange Notes”) for any and all of its outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Initial Notes”) if the Letter of Transmittal or any other documents required thereby cannot be delivered to the Exchange Agent, or Initial Notes cannot be delivered or if the procedures for book-entry transfer cannot be completed prior to the Expiration Date. This form may be delivered by a firm that is an eligible guarantor institution within the meaning of Rule 17Ad-15 under the Exchange Act, including a firm that is a member of a registered national securities exchange, a member of the National Association of Securities Dealers, Inc., a commercial bank or trading company having an office in the United States or certain other eligible guarantors (each, an “Eligible Institution”) an Eligible Institution by mail or hand

delivery or transmitted via facsimile to the Exchange Agent as set forth above. Capitalized terms used but not defined herein shall have the meaning given to them in the Prospectus.

This form is not to be used to guarantee signatures. If a signature on the Letter of Transmittal is required to be guaranteed by an Eligible Institution under the instructions thereto, such signature guarantee must appear in the applicable space provided in the Letter of Transmittal.

 

2

PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY

Ladies and Gentlemen:

The undersigned hereby tenders to the Issuers upon the terms and subject to the conditions set forth in the Prospectus and the related Letter of Transmittal, receipt of which is hereby acknowledged, the principal amount of Initial Notes specified below pursuant to the guaranteed delivery procedures set forth in the section of the Prospectus entitled “The Exchange Offer—Procedures for Tendering Initial Notes—Guaranteed Delivery Procedures.” By so tendering, the undersigned does hereby make, at and as of the date hereof, the representations and warranties of a tendering Holder of Initial Notes set forth in the Letter of Transmittal.

The undersigned understands that tenders of Initial Notes may be withdrawn if the Exchange Agent receives at one of its addresses specified on the cover of this Notice of Guaranteed Delivery, prior to the Expiration Date, a facsimile transmission or letter which specifies the name of the person who deposited the Initial Notes to be withdrawn and the aggregate principal amount of Initial Notes delivered for exchange, including the certificate number(s) (if any) of the Initial Notes, and which is signed in the same manner as the original signature on the Letter of Transmittal by which the Initial Notes were tendered, including any signature guarantees, all in accordance with the procedures set forth in the Prospectus.

All authority herein conferred or agreed to be conferred shall survive the death, incapacity, or dissolution of the undersigned and every obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned.

 

3

The undersigned hereby tenders the Initial Notes listed below:

PLEASE SIGN AND COMPLETE

 

Certificate Numbers of Initial Notes
(if Available)

   
Principal Amount of Initial Notes Tendered
      
      
      
      
      
      

 

 

 

  
  Signature(s) of registered holder(s) or Authorized Signatory  
  Name(s)  

 

  
  (Please Type or Print)  
  Title  

 

  
  Address  

 

  
 

 

  
 

 

  
  Area Code and Telephone No.  

 

  
  Date  

 

  
  If Initial Notes will be tendered by book-entry transfer, check the trust company below:  
 

¨       The Depository Trust Company

  
  Depository Account No.:  

 

 

  

 

4

 

GUARANTEE

(Not To Be Used For Signature Guarantee)

 

The undersigned, a participant in a recognized Signature Guarantee Medallion Program, guarantees deposit with the Exchange Agent of the Letter of Transmittal (or facsimile thereof), together with the Initial Notes tendered hereby in proper form for transfer, or confirmation of the book-entry transfer of such Initial Notes into the Exchange Agent’s account at The Depository Trust Company, pursuant to the procedure for book-entry transfer set forth in the Prospectus, and any other required documents, all by 5:00 p.m., New York City time, on the third New York Stock Exchange trading day following the Expiration Date (as defined in the Prospectus).

  
 

 

SIGN HERE

 

  
  Name of Firm:  

 

  
  Authorized Signature:  

 

  
  Name (please type or print):  

 

  
  Address:  

 

  
 

 

  
 

 

  
  Area Code and Telephone No.:  

 

  
  Date:  

 

 

  

DO NOT SEND CERTIFICATES FOR INITIAL NOTES WITH THIS FORM. ACTUAL SURRENDER OF CERTIFICATES FOR INITIAL NOTES MUST BE MADE PURSUANT TO, AND BE ACCOMPANIED BY, A COPY OF THE PREVIOUSLY EXECUTED LETTER OF TRANSMITTAL.

 

5

PROCEDURES FOR TENDERING INITIAL NOTES—GUARANTEED DELIVERY

INSTRUCTIONS

1. Delivery of this Notice of Guaranteed Delivery. A properly completed and duly executed copy of this Notice of Guaranteed Delivery and any other documents required by this Notice of Guaranteed Delivery must be received by the Exchange Agent at its address set forth on the cover hereof prior to the Expiration Date. The method of delivery of this Notice of Guaranteed Delivery and all other required documents to the Exchange Agent is at the election and risk of the Holder but, except as otherwise provided below, the delivery will be deemed made only when actually received by the Exchange Agent. Instead of delivery by mail, it is recommended that Holders use an overnight or hand delivery service, properly insured. If such delivery is by mail, it is recommended that the Holder use properly insured, registered mail with return receipt requested. For a full description of the guaranteed delivery procedures, see the Prospectus under the caption “The Exchange Offer—Procedures for Tendering Initial Notes—Guaranteed Delivery Procedures.” In all cases, sufficient time should be allowed to assure timely delivery. No Notice of Guaranteed Delivery should be sent to the Issuers.

2. Signature on this Notice of Guaranteed Delivery; Guarantee of Signatures. If this Notice of Guaranteed Delivery is signed by the Holder(s) referred to herein, then the signature must correspond with the name(s) as written on the face of the Initial Notes without alteration, enlargement or any change whatsoever. If this Notice of Guaranteed Delivery is signed by a person other than the Holder(s) listed, this Notice of Guaranteed Delivery must be accompanied by a properly completed bond power signed as the name of the Holder(s) appear(s) on the face of the Initial Notes without alteration, enlargement or any change whatsoever. If this Notice of Guaranteed Delivery is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and, unless waived by the Issuers, evidence satisfactory to the Issuers of their authority so to act must be submitted with this Notice of Guaranteed Delivery.

3. Requests for Assistance or Additional Copies. Questions relating to the Exchange Offer or the procedure for consenting and tendering as well as requests for assistance or for additional copies of the Prospectus, the Letter of Transmittal and this Notice of Guaranteed Delivery, may be directed to the Exchange Agent at the address set forth on the cover hereof or to your broker, dealer, commercial bank or trust company.

 

6

EX-99.3 50 dex993.htm EXHIBIT 99.3 Exhibit 99.3

Exhibit 99.3

Letter to DTC Participants Regarding the Offer to Exchange

Any and All Outstanding 9% Senior Secured Second Lien Notes due 2018

for

9% Senior Secured Second Lien Notes due 2018

of

TOMKINS, LLC and TOMKINS, INC.

Pursuant to the Prospectus dated             , 2011

 

THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON             , 2011, UNLESS EXTENDED (SUCH TIME AND DATE, AS THE SAME MAY BE EXTENDED FROM TIME TO TIME, THE “EXPIRATION DATE”). TENDERS MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE.

, 2011

To Securities Dealers, Commercial Banks,

Trust Companies and Other Nominees:

Enclosed for your consideration is a Prospectus dated             , 2011 (the “Prospectus”) and a Letter of Transmittal (the “Letter of Transmittal”) that together constitute the offer (the “Exchange Offer”) of Tomkins, LLC, a Delaware limited liability company (the “LLC Co-Issuer”), and Tomkins, Inc., a Delaware corporation (the “Corporate Co-issuer” and, together with the LLC Co-Issuer, the “Issuers”), to exchange up to $1,150,000,000 of its outstanding 9% Senior Secured Second Lien Notes due 2018, which have been registered under the Securities Act of 1933, as amended (the “Securities Act”) (the “Exchange Notes”) for an equal aggregate principal amount of its outstanding 9% Senior Secured Second Lien Notes due 2018, issued and sold in a transaction exempt from registration under the Securities Act (the “Initial Notes”), upon the terms and conditions set forth in the Prospectus. The Prospectus and Letter of Transmittal more fully describe the Exchange Offer. Capitalized terms used but not defined herein have the meanings given to them in the Prospectus.

We are asking you to contact your clients for whom you hold Initial Notes registered in your name or in the name of your nominee. In addition, we ask you to contact your clients who, to your knowledge, hold Initial Notes registered in their own name.

Enclosed are copies of the following documents:

 

  1. The Prospectus;

 

  2. The Letter of Transmittal for your use in connection with the tender of Initial Notes and for the information of your clients;

 

  3. The Notice of Guaranteed Delivery to be used to accept the Exchange Offer if the Initial Notes and all other required documents cannot be delivered to the Exchange Agent prior to the Expiration Date;

 

  4. A form of letter that may be sent to your clients for whose accounts you hold Initial Notes registered in your name or the name of your nominee, with space provided for obtaining the clients’ instructions with regard to the Exchange Offer; and

 

  5. Guidelines for Certificate of Taxpayer Identification Number on Substitute Form W-9.

DTC participants will be able to execute tenders through the DTC Automated Tender Offer Program.

Please note that the Exchange Offer will expire at 5:00 p.m., New York City time, on             , 2011, unless extended by the Issuers. We urge you to contact your clients as promptly as possible.

You will be reimbursed by the Issuers for customary mailing and handling expenses incurred by you in forwarding any of the enclosed materials to your clients.

Additional copies of the enclosed material may be obtained from the Exchange Agent, at the address and telephone numbers set forth below.

 

Very truly yours,

WILMINGTON TRUST FSB

Attn: Sam Hamed

Wilmington Trust FSB

c/o Wilmington Trust Company

Corporate Capital Markets

Rodney Square North

1100 North Market Street

Wilmington, Delaware 19890-1626

 

Telephone:               +1.302.363.6181
Fax:               +1.302.636.4139

NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY PERSON AS AN AGENT OF THE ISSUERS OR THE EXCHANGE AGENT, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENTS ON BEHALF OF EITHER OF THEM WITH RESPECT TO THE EXCHANGE OFFER, EXCEPT FOR STATEMENTS EXPRESSLY MADE IN THE PROSPECTUS AND THE LETTER OF TRANSMITTAL.

 

2

EX-99.4 51 dex994.htm EXHIBIT 99.4 Exhibit 99.4

Exhibit 99.4

Letter to Beneficial Holders Regarding the Offer to Exchange

Any and All Outstanding 9% Senior Secured Second Lien Notes due 2018

for

9% Senior Secured Second Lien Notes due 2018

of

TOMKINS, LLC and TOMKINS, INC.

Pursuant to the Prospectus dated             , 2011

 

THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON             , 2011, UNLESS EXTENDED (SUCH TIME AND DATE, AS THE SAME MAY BE EXTENDED FROM TIME TO TIME, THE “EXPIRATION DATE”). TENDERS MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE EXPIRATION DATE.

, 2011

To Our Clients:

Enclosed for your consideration is a Prospectus dated             , 2011 (the “Prospectus”) and a Letter of Transmittal (the “Letter of Transmittal”) that together constitute the offer (the “Exchange Offer”) by Tomkins, LLC, a Delaware limited liability company (the “LLC Co-Issuer”), and Tomkins, Inc., a Delaware corporation (the “Corporate Co-issuer” and, together with the LLC Co-Issuer, the “Issuers”), to exchange up to $1,150,000,000 of its outstanding 9% Senior Secured Second Lien Notes due 2018, which have been registered under the Securities Act of 1933, as amended (the “Securities Act”) (the “Exchange Notes”), for an equal aggregate principal amount of 9% Senior Secured Second Lien Notes due 2018, issued and sold in a transaction exempt from registration under the Securities Act (the “Initial Notes”), upon the terms and conditions set forth in the Prospectus. The Prospectus and Letter of Transmittal more fully describe the Exchange Offer. Capitalized terms used but not defined herein have the meanings given to them in the Prospectus.

These materials are being forwarded to you as the beneficial owner of Initial Notes carried by us for your account or benefit but not registered in your name. A tender of any Initial Notes may be made only by us as the registered holder and pursuant to your instructions. Therefore, the Issuers urge beneficial owners of Initial Notes registered in the name of a broker, dealer, commercial bank, trust company or other nominee to contact such registered holder promptly if they wish to tender Initial Notes in the Exchange Offer.

Accordingly, we request instructions as to whether you wish us to tender any or all of your Initial Notes, pursuant to the terms and conditions set forth in the Prospectus and Letter of Transmittal. We urge you to read carefully the Prospectus and Letter of Transmittal before instructing us to tender your Initial Notes.

Your instructions to us should be forwarded as promptly as possible in order to permit us to tender Initial Notes on your behalf in accordance with the provisions of the Exchange Offer. The Exchange Offer will expire at 5:00 p.m., New York City time, on             , 2011. Initial Notes tendered pursuant to the Exchange Offer may be withdrawn, subject to the procedures described in the Prospectus, at any time prior to the Expiration Date.

If you wish to have us tender any or all of your Initial Notes held by us for your account or benefit, please so instruct us by completing, executing and returning to us the instruction form that appears below. The accompanying Letter of Transmittal is furnished to you for informational purposes only and may not be used by you to tender Initial Notes held by us and registered in our name for your account or benefit.

Instructions To Registered Holder

From Beneficial Owner of

9% Senior Secured Second Lien Notes due 2018 of

TOMKINS, LLC and TOMKINS, INC.

The undersigned acknowledge(s) receipt of your letter and the enclosed materials referred to therein relating to the Exchange Offer of the Issuers. Capitalized terms used but not defined herein have the meanings ascribed to them in the Prospectus.

This will instruct you to tender the principal amount of Initial Notes indicated below held by you for the account or benefit of the undersigned, pursuant to the terms of and conditions set forth in the Prospectus and the Letter of Transmittal.

The aggregate face amount of the Initial Notes held by you for the account of the undersigned is (fill in amount):

$         of the Initial Notes.

With respect to the Exchange Offer, the undersigned hereby instructs you (check appropriate box):

 

  ¨ To TENDER the following Initial Notes held by you for the account of the undersigned (insert principal amount of Initial Notes to be tendered, if any):

$         of the Initial Notes.

 

  ¨ NOT to TENDER any Initial Notes held by you for the account of the undersigned.

If the undersigned instructs you to tender the Initial Notes held by you for the account of the undersigned, it is understood that you are authorized (a) to make, on behalf of the undersigned (and the undersigned, by its signature below, hereby makes to you), the representations and warranties contained in the Letter of Transmittal that are to be made with respect to the undersigned as a beneficial owner of the Initial Notes, including but not limited to the representations that (i) the undersigned’s principal residence is in the state of (fill in state) , (ii) the undersigned is acquiring the Exchange Notes in the ordinary course of business of the undersigned, (iii) the undersigned has no arrangement or understanding with any person to participate in the distribution (within the meaning of the Securities Act) of the Exchange Notes in violation of the Securities Act and at the time of consummation of the Exchange Offer the undersigned will have no such arrangement or understanding, and if the undersigned is not a broker-dealer, the undersigned is not engaged in, and does not intend to engage in, the distribution of Exchange Notes, (iv) the undersigned acknowledges and agrees that any person who is a broker-dealer registered under the Exchange Act or is participating in the Exchange Offer for the purpose of distributing the Exchange Notes must comply with the registration and prospectus delivery requirements of Section 10 of the Securities Act in connection with a secondary resale transaction of the Exchange Notes acquired by such person and cannot rely on the position of the Staff of the Securities and Exchange Commission set forth in certain no action letters (see the section of the Prospectus entitled “The Exchange Offer—Purpose and Effect of the Exchange Offer”), (v) the undersigned understands that a secondary resale transaction described in clause (iv) above and any resales of Exchange Notes obtained by the undersigned in exchange for the Initial Notes acquired by the undersigned directly from the Issuers should be covered by an effective registration statement containing the selling securityholder information required by Item 507 or Item 508, if applicable, of Regulation S-K of the Commission, (vi) the undersigned is not an “affiliate,” as defined in Rule 405 under the Securities Act, of the Issuers, (vii) if the undersigned is a broker-dealer that will receive Exchange Notes for its own account in exchange for Initial Notes that were acquired as a result of market-making activities or other trading activities, it acknowledges that it will deliver a prospectus meeting the requirements of Section 10 of the Securities Act in connection with any resale of such Exchange Notes; however, by so acknowledging and by delivering such prospectus, the undersigned will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act; and (viii) the undersigned is not acting on behalf of any persons or entities who could not truthfully make the foregoing representations; (b) to agree, on behalf of the undersigned, as set forth in the Letter of Transmittal; and (c) to take such other action as necessary under the Prospectus or the Letter of Transmittal to effect the valid tender of Initial Notes.

 

2

The purchaser status of the undersigned is (check the box that applies):

 

  ¨ A “Qualified Institutional Buyer” (as defined in Rule 144A under the Securities Act).

 

  ¨ An “Institutional Accredited Investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act).

 

  ¨ A non “U.S. person” (as defined in Regulation S under the Securities Act) that purchased the Initial Notes outside the United States in accordance with Rule 904 under the Securities Act.

 

  ¨ Other (describe)

 

SIGN HERE
 
Name of beneficial owner(s)                                                                                                                                                                                                     
 
Signature(s)                                                                                                                                                                                                                            
 
Name(s) of Signatory(ies), if different from beneficial owner (please print)                                                                                                                                     
 

 

 
Address                                                                                                                                                                                                                                   
 
Principal place of business (if different from address listed above)                                                                                                                                                 
 

 

 
Telephone Number(s)                                                                                                                                                                                                              
 
Taxpayer Identification or Social Security Number                                                                                                                                                                      
 

Date                                                                                                                                                                                                                                       

 

 

3

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Pinafore Holdings B.V.

Fred. Roeskestraat 123

1076 EE, Amsterdam

The Netherlands

June 24, 2011

VIA EDGAR

U.S. Securities and Exchange Commission

Division of Corporation Finance

100 F Street, N.E.

Washington, D.C. 20549

 

  Re:

Pinafore Holdings B.V.

Registration Statement on Form F-4

with respect to up to $1,150,000,000 Principal Amount of 9% Senior

Secured Second Lien Notes due 2018

File No. 333-

Dear Ladies and Gentlemen:

In connection with the above-referenced registration statement (the “Registration Statement”) filed by Pinafore Holdings B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of The Netherlands (the “Company”), relating to a proposed offer (the “Exchange Offer”) by Tomkins, Inc. (formerly Pinafore, Inc.) (the “Finance Co.”), a Delaware corporation and Tomkins, LLC (formerly Pinafore, LLC) (the “Finance LLC,” and, together with the Finance Co., the “Issuers”), a Delaware limited liability company, to exchange up to $1,150,000,000 aggregate principal amount of the Issuers’ 9% Senior Secured Second Lien Notes due 2018 (the “Exchange Notes”) and the guarantees thereof by each of the Company’s subsidiaries named in the Registration Statement (together with the Company and the Issuers, the “Co-Registrants”) for up to $1,150,000,000 aggregate principal amount of the Issuers’ outstanding 9% Senior Secured Second Lien Notes due 2018 (the “Outstanding Notes”), I am writing to advise you supplementally that:

 

  (i)

the Co-Registrants are registering the Exchange Offer in reliance on the position of the staff of the Commission (the “Staff”) enunciated in Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in the Commission’s letter to Shearman & Sterling dated July 2, 1993, and Morgan Stanley & Co. Inc. (available June 5, 1991);

 

  (ii)

the Co-Registrants have not entered into any arrangement or understanding with any person to distribute the Exchange Notes or the guarantees thereof and, to the best of the Co-Registrants’ information and belief, each person participating in the Exchange Offer is acquiring the securities in its ordinary course of business and has no arrangement or understanding with any person to participate in the distribution of the securities to be received in the Exchange Offer;

U.S. Securities and Exchange Commission

June 24, 2011

Page 2

 

  (iii)

the Issuers will make each person participating in the Exchange Offer aware, through the prospectus forming a part of the Registration Statement (the “Prospectus”), that —

 

  (A)

any broker-dealer and any noteholder using the Prospectus to participate in a distribution of the Exchange Notes (x) could not rely on the Staff position enunciated in Exxon Capital Holdings Corporation (available May 13, 1988) or similar letters and (y) must comply with the registration and prospectus delivery requirements of the Securities Act of 1933 (the “Securities Act”) in connection with a secondary resale transaction, and

 

  (B)

any broker-dealer who holds Outstanding Notes acquired for its own account as a result of market-making activities or other trading activities, and who receives Exchange Notes in exchange for such Outstanding Notes pursuant to the Exchange Offer, may be a statutory underwriter and must deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Notes;

 

  (iv)

the Issuers acknowledge that any secondary resale transaction, as described in clause (iii)(A) above, should be covered by an effective registration statement containing the selling noteholder information required by Item 507 of Regulation S-K;

 

  (v)

the Issuers will include in the transmittal letter to be executed by each tendering noteholder that elects to participate in the Exchange Offer a representation from such tendering noteholder to the Issuers that —

 

  (A)

the Exchange Notes or book-entry interests therein to be acquired by such holder and any beneficial owner(s) of such Outstanding Notes or interests therein (“Beneficial Owner(s)”) in connection with the Exchange Offer are being acquired by such holder and any Beneficial Owner(s) in the ordinary course of business of the holder and any Beneficial Owner(s),

 

  (B)

the holder and each Beneficial Owner are not engaging, do not intend to engage, and have no arrangement or understanding with any person to participate, in the distribution of the Exchange Notes,

 

  (C)

the holder and each Beneficial Owner acknowledge and agree that any person who is a broker-dealer registered under the Securities Exchange Act of 1934, as amended, or is participating in the Exchange Offer for the purpose of distributing the Exchange Notes, must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction of the Exchange Notes or interests therein acquired by such person and cannot rely on the position of the Staff set forth in certain no-action letters,

U.S. Securities and Exchange Commission

June 24, 2011

Page 3

 

 

  (D)

the holder and each Beneficial Owner understands that a secondary resale transaction described in clause (v)(C) above and any resales of the Exchange Notes or interests therein obtained by such holder in exchange for the Outstanding Notes or interests therein originally acquired by such holder directly from the Issuers should be covered by an effective registration statement containing the selling security holder information required by Item 507 or Item 508, as applicable, of Regulation S-K of the Commission,

 

  (E)

neither the holder nor any Beneficial Owner(s) is an “affiliate,” as defined in Rule 405 under the Securities Act, of any of the Co-Registrants, and

 

  (F)

in the event such holder is a broker-dealer (whether or not it is also an “affiliate”) that will receive Exchange Notes for its own account pursuant to the Exchange Offer, the Outstanding Notes tendered in the Exchange Offer were acquired by such broker-dealer as a result of market-making activities or other trading activities, and such holder acknowledges that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Notes; however, by so acknowledging and by delivering a Prospectus, the holder will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act;

 

  (vi)

the Issuers will commence the Exchange Offer when the Registration Statement is declared effective by the Commission;

 

  (vii)

the Exchange Offer will remain in effect for a limited time and, except with respect to broker-dealers who tender in the Exchange Offer for whom the Issuers will keep the Registration Statement effective for up to 180 days, will not require the Issuers to maintain an “evergreen” registration statement; and

 

  (viii)

the Exchange Offer will be conducted by the Issuers in compliance with the Securities Exchange Act of 1934, and any applicable rules and regulations thereunder.

If you have any questions regarding this matter please contact the undersigned or our counsel, Rachel W. Sheridan and Patrick H. Shannon of Latham & Watkins LLP, at (202) 637-2139 and (202) 637-1028, respectively.

U.S. Securities and Exchange Commission

June 24, 2011

Page 4

 

   

Sincerely yours,

   

Pinafore Holdings B.V.

   

By:

   

      /s/ Roel Langelaar

   
   

Name:

   

Roel Langelaar

   
   

Title:

   

Managing Director

   

 

cc:

Rachel W. Sheridan

Patrick H. Shannon

Latham & Watkins LLP