exv10w38






Exhibit 10.38




 





Letter of Indemnification




Dated April 21, 2010




Rank Group Limited




for the benefit and in favour of



the Indemnitees defined in this Letter of Indemnification



(Germany
– SIG)




 





 









 





Contents




	 	 	 	 	 
	Clause	 	 	 	Page
	1.
	 	Definitions	 	2
	2.
	 	Indemnification	 	3
	3.
	 	Limitations on Indemnification	 	3
	4.
	 	Indemnification Procedure	 	3
	5.
	 	Severability	 	4
	6.
	 	Governing law	 	4
	7.
	 	Amendments	 	4











 









 








THIS LETTER OF INDEMNIFICATION (this “Letter”) is dated on

April 21, 2010 and made between



Rank Group Limited (registered in New Zealand whose registered office is at c/- Bell Gully (GJM),
Level 22, Vero Centre, 48 Shortland Street, Auckland, New Zealand) (“Rank”);




and



Each Indemnitee (as defined below).




BACKGROUND





	A.	 	On 5 November 2009 Beverage Packaging Holdings (Luxembourg) III S.à r.l. acquired, both
directly and through a subsidiary, the Closure Systems International group of companies and
the Reynolds Consumer Products group of companies. The financing arrangements put in place for
this acquisition, and the original acquisition of the SIG group of companies, were amended or
replaced, including (without limitation) by (i) the entry into of a senior secured credit
agreement, dated 5 November 2009, between, among others, Reynolds Group Holdings Limited
(“RGHL”), the borrowers listed therein and Credit Suisse AG as administrative agent
(as subsequently amended, restated or otherwise modified from time to time, the “Senior
Credit Facilities”), (ii) the entry into of an indenture dated 5 November 2009 (the
“2009 Indenture”), in respect of senior secured notes due 2016 (the “2009
Notes”) and (iii) entry into certain intercreditor arrangements in respect of the Senior
Credit Facilities, the 2009 Notes, and certain senior notes and senior subordinated notes
issued in 2007 by Beverage Packaging Holdings (Luxembourg) II S.A. (together the “2007
Notes”) (collectively, the “Existing Financing”).






	B.	 	It is currently anticipated that RGHL will indirectly acquire (i) the Evergreen group of
companies (the “Evergreen Group”) from certain subsidiaries of the parent of the
Evergreen Group, Carter Holt Harvey Limited (“CHH”) and (ii) the business, assets and
liabilities of the Whakatane Paper Mill from CHH (collectively, the “Acquisition”).






	C.	 	In connection with the Acquisition, certain members of the Evergreen Group, RGHL and certain
of its subsidiaries will incur additional debt, and that the Existing Financing will be
supplemented and/or amended. The German Subsidiary (as defined below) may, among other things,
be required to do all or some of the following:




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	 	1.	 	enter into a new indenture in respect of new unsecured notes (the
“Unsecured Notes”) issued by an indirect subsidiary of RGHL, including the
provision of unsecured guarantees in respect of such notes;
	 
	 	2.	 	confirm that the guarantees and/or security provided by the German Subsidiary
in respect of the 2009 Notes extends to any additional senior secured notes, issued
either by way of (i) a supplement to the 2009 Indenture or (ii) a new senior notes
indenture (collectively, the Senior Secured Notes”);
	 
	 	3.	 	confirm that the guarantees and/or security provided by the German Subsidiary
in respect of the Senior Credit Facilities extends to the additional debt incurred
either under (i) an incremental facility provided for in the Senior Credit Facilities
and/or (ii) an amendment to the Senior Credit Facilities (collectively, the “Bank
Debt”); and
	 
	 	4.	 	enter into new, and/or amend existing, intercreditor arrangements in respect
of the Unsecured Notes, the Senior Secured Notes, the Bank Debt and the 2007 Notes,
	 
	 	 	 	(collectively, the “Transactions”).






	D.	 	Rank has agreed to provide an indemnity to the Indemnitees in respect of the Transactions as
further described below.




It is the intention of Rank that this document be executed as a Letter of Indemnification in favour
and for the benefit of each Indemnitee.



IT IS AGREED as follows:





	1.	 	Definitions
	 
	 	 	“Director” means any managing director (Geschäftsführer) , in the case of SIG Euro
Holding AG & Co. KGaA, members of the board of directors (Verwaltungsrat) of its general
partner SIG Reinag AG.
	 
	 	 	“German Subsidiary” means each company and partnership listed in Part A of the
Schedule to this Letter.




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	 	 	“Indemnitee” means each person listed in Part B of the Schedule to this Letter.
	 
	 	 	“Indemnitee Company” means, in relation to an Indemnitee, any German Subsidiary of
which an Indemnitee is a Director.
	 
	2.	 	Indemnification
	 
	 	 	Rank shall — upon first demand (auf erstes Anfordern) — indemnify (freistellen) each
Indemnitee against expenses, losses, liabilities, judgments, fines, penalties and amounts
paid in settlement (including all interest, assessments and other charges in connection
therewith) incurred by an Indemnitee or on an Indemnitee’s behalf in connection with any
proceeding resulting from or relating to decisions the Indemnitee made or any actions the
Indemnitee took on behalf of an Indemnitee Company in his or her capacity as a Director of
the Indemnitee Company on written (including by e-mail or telefax) instruction from a
direct or indirect shareholder of the relevant Indemnitee Company in connection with any
transactions or the approval or execution of any resolutions or documents in relation to
the Transactions.
	 
	3.	 	Limitations on Indemnification
	 
	 	 	Notwithstanding any other provision of this Letter, an Indemnitee shall not be entitled to
indemnification under this Letter:






	 	1.	 	to the extent that payment is actually made, or for which payment may be
immediately claimed, to or on behalf of the relevant Indemnitee under an insurance
policy, unless the Indemnitee assigns to Rank any related payments claims under such
insurance policy; or
	 
	 	2.	 	to the extent that payment has or will be made to the relevant Indemnitee by
the Indemnitee Company or any affiliate of Rank otherwise than pursuant to this
Letter.






	4.	 	Indemnification Procedure
	 
	A.	 	Each Indemnitee shall give Rank notice in writing (including by e-mail or telefax) as soon as
practicable of any proceeding in relation to that Indemnitee for which indemnification will or
could be sought under this Letter. To obtain indemnification payments or advances under this
Letter, an Indemnitee shall submit to Rank a written request therefore, together with such
invoices or




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		 	other supporting information as may be reasonably requested by Rank and reasonably
available to the relevant Indemnitee. Rank shall make such indemnification payment within
10 business days of receipt of such invoices and supporting information.
	 
	B.	 	Each Indemnitee shall be obliged as soon as practicable to claim his rights under any
applicable insurance policy and shall assign to Rank any related payments claims under such
insurance policy. However this clause 4.2 does not affect the Indemnitee’s right to
indemnification under clause 2 above.
	 
	C.	 	For the avoidance of doubt, an Indemnitee shall not forego any rights to indemnification
under this Letter where he fails to give notice within the period specified in sentence 1 (“as
soon as practicable”) of this clause 4.
	 
	5.	 	Severability
	 
	 	 	If any provision or provisions of this Letter shall be held to be invalid, illegal or
unenforceable for any reason, the validity, legality and enforceability of the remaining
provisions of this Letter and this Letter as such shall not in any way be affected or
impaired thereby and shall remain enforceable to the fullest extent permitted by law.
	 
	6.	 	Governing law and jurisdiction; Language
	 
	 	 	This Letter shall be governed by and its provisions construed in accordance with German
law. For the benefit of each Indemnitee, Rank submits to the non-exclusive jurisdiction of
the courts of Neuss (Germany) to settle any dispute arising out of or in connection with
this Letter (including any dispute regarding the existence, validity or termination of this
Letter).
	 
	 	 	Whenever an English term of this Letter is followed by a German term in parenthesis, the
German term shall prevail for the purpose of construction of this Letter.
	 
	7.	 	Amendments
	 
	 	 	No amendment or modification of this Letter shall be effective unless it is approved in
writing by each Indemnitee having the benefit of this Letter.




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This Letter Agreement has been executed as of the date stated at the beginning hereof.




	 	 	 	 	 
	 	Rank Group Limited

 	 
	 	/s/ Graeme Hart
 	 
	 	By: Graeme Hart 	 
	 	Position: Director	 
	 	
Address: 743 Riddell Rd, Glendowie, New Zealand 1005 	 
	 





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Schedule




Part A



List of German Subsidiaries




	•	 	SIG Beverages Germany GmbH
	 
	•	 	SIG Combibloc Holding GmbH
	 
	•	 	SIG Combibloc Systems GmbH
	 
	•	 	SIG Combibloc GmbH
	 
	•	 	SIG Combibloc Zerspanungstechnik GmbH
	 
	•	 	SIG Information Technology GmbH
	 
	•	 	SIG International Services GmbH
	 
	•	 	SIG Vietnam Beteiligungs GmbH
	 
	•	 	SIG Euro Holding AG & Co KGaA




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Part B




List of Indemnitees





	•	 	Marco Haussener
	 
	•	 	Joachim Frommherz
	 
	•	 	Holger Dickers
	 
	•	 	Markus Boehm
	 
	•	 	Stefan Breu
	 
	•	 	André Rosenstock
	 
	•	 	Christian Alt
	 
	•	 	Jan-Eric Kruse
	 
	•	 	Hermann-Josef Bücker
	 
	•	 	Timo Snellman
	 
	•	 	Dr Franz Josef Collin
	 
	•	 	Dr Daniel Kiwit






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