Document:

Exhibit

Exhibit 10.15

MANUFACTURING SERVICES AGREEMENT
between
KIN YAT INDUSTRIAL COMPANY LIMITED
and
IROBOT CORPORATION
    

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

MANUFACTURING SERVICES AGREEMENT

This Non-Exclusive Manufacturing Agreement (this “Agreement”) is entered into by and between Kin Yat Industrial Company Limited, (“Kin Yat”), having offices at 7/F., Galaxy Factory Building, 25-27 Luk Hop Street, San Po Kong, Kowloon, Hong Kong, and iRobot Corporation, a Delaware corporation (“iRobot”), having its principal place of business at 8 Crosby Drive, Bedford, MA  01730. Kin Yat and iRobot are referred to herein as “Party” or “Parties”.
    
RECITALS

A.    Kin Yat is in the business of providing sophisticated manufacturing services that are unique in kind and quality, including designing, developing, manufacturing, testing, configuring, assembling, packaging and shipping highly specialized electronic assemblies and systems.

B.    iRobot is in the business of designing, developing, distributing, marketing and selling products containing highly specialized electronic assemblies and systems.

C.    Whereas, the Parties desire that Kin Yat manufactures, tests, configures, assembles, packages and/or ships certain electronic assemblies and systems pursuant to the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:

TERMS
		
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	Definitions.  In addition to terms defined elsewhere in this Agreement, the capitalized terms set forth below shall have the following meaning:

1.1    “Additional Services” means services such as, design for manufacturability, manufacturing design test support, computer assisted design for manufacturability, test development services, volume production and advanced packaging technologies all as specified and approved by iRobot and agreed to by Kin Yat.

1.2    “Affiliate” means with respect to a Person, any other Person which directly or indirectly controls, or is controlled by, or is under common control with, the specified Person.  For purposes of the preceding sentence, “control” of a 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, or direct or indirect ownership (beneficially or of record) of, or direct or indirect power to vote, 50% or more of the outstanding shares of any class of capital stock of such Person (or in the case of a Person that is not a corporation, 50% or more of any class of equity interest).

1.3    “Assigned Components” means the components or materials specifically identified in Schedule 1 as “assigned” and for which iRobot has identified the applicable supplier from whom Kin Yat is authorized to source such component or material for incorporation into the Product.

1.4    “AVL” means the confidential list of Suppliers Designated by iRobot from which Kin Yat is authorized to purchase the applicable Assigned Components and Generic Components, if any for use in the manufacture of Products.

1.5    “Class Failure” “Class Failure” means a defect caused by (i) Kin Yat’s failure to manufacture the Product to conform to the Specifications or other requirements in this Agreement, or (ii) the failure of Kin Yat to comply with any applicable law, rule, regulation, court order or decree that is applicable to Kin Yat’s performance of its obligations set forth in this Agreement, or (iii) the gross negligence or willful misconduct of Kin Yat’s personnel performing Manufacturing Services for iRobot under this Agreement; wherein, such defect occurs in more than [***], attributable to the same root cause, of the total number of a particular Product (as identified by the applicable Product serial numbers) supplied under this Agreement over a rolling [***] period within the Warranty Period.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

    

1.6    Kin Yat shall be defined to include any Kin Yat Subsidiary. (if applicable).

1.7    “Commercially Reasonable Efforts” means those efforts that would be deemed both commercially practicable and reasonably financially prudent after having taken into account all relevant commercial considerations.  “Relevant commercial considerations” shall be deemed to include, without limitation, (1) all pertinent facts and circumstances; (2) financial costs; (3) resource availability and impact; (4) probability of success; and (5) other commercial practicalities.

1.8    “Components” means those Assigned Components, Generic Components, and Consigned Components.

1.9    “Consigned Components” means those components or materials specifically identified in Schedule 1 as “consigned” and provided by or on behalf of iRobot to Kin Yat for assembly into Products.  

1.10    “Defect” means Product that does not conform to Specifications within the warranty Period, resulting from, but not limited to, non-conforming Components, materials, processes, packaging, and transportation.

1.11    “EDI” shall mean electronic data interchange.

1.12    “Effective Date” shall mean the date upon which the terms and conditions of this Agreement shall become effective by and between the Parties. The Parties have agreed that the Effective Date of this Agreement shall be September 23, 2013.

1.13    “Encumbrance” means any encumbrance, lien, charge, hypothecation, pledge, mortgage, title retention agreement, security interest of any nature, adverse claim, exception, right of set-off, any matter capable of registration against title, option, right of pre-emption, privilege or any contract to create any of the foregoing.

1.14    “Fee and Price Schedule” shall mean the prices and fees set forth in Schedule 2 for the applicable Product identified therein, and any future Fee and Price Schedule for new Product as added in writing from time to time upon mutual agreement of the Parties.

1.15    “FCA” means that Kin Yat must at its own expense and risk deliver the Product cleared for export into the custody of the designated carrier at the applicable Port of Origin.

1.16    “Generic Components” means the components or materials identified in Schedule 1 for incorporation into the Product and for which iRobot has not identified any specific supplier or source from whom Kin Yat is authorized to source such component or material. 

1.17    “including” shall be defined to have the meaning “including, without limitation.”

1.18    “in writing” shall mean written documents, EDI with phone confirmation, verified faxes and successfully transmitted e-mails.

1.19    “Intellectual Property” means any and all intellectual property and tangible embodiments thereof, including without limitation inventions, discoveries, designs, specifications, developments, methods, modifications, improvements, processes, know-how, show-how, techniques, algorithms, databases, computer software and code (including software and firmware listings, assemblers, applets, compilers, source code, object code, net lists, design tools, user interfaces, application programming interfaces, protocols, formats, documentation, annotations, comments, data, data structures, databases, data collections, system build software and instructions), mask works, formulae, techniques, supplier and customer lists, trade secrets, graphics or images, text, audio or visual works, materials that 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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document design or design processes, or that document research or testing, schematics, diagrams, product specifications and other works of authorship. 

1.20    “Intellectual Property – KIN YAT” shall mean both Intellectual Property – Created by Kin Yat and Intellectual Property - Existing by Kin Yat, collectively.

1.21    “Intellectual Property – Created by Kin Yat” means any improvements to the Technical Manufacturing Information – KIN YAT that are newly created or developed, and reduced to practice by Kin Yat in (i) preparing any Product provided pursuant to this Agreement, or (ii) performing the Manufacturing Services or any other work provided pursuant to this Agreement; but shall not include any Intellectual Property - Existing by Kin Yat.

1.22    “Intellectual Property – Existing by “Kin Yat” means any Intellectual Property, including the Technical Manufacturing Information – KIN YAT, created or developed by Kin Yat outside the scope of this Agreement during the Term or owned or controlled by Kin Yat prior to the execution of this Agreement; and all improvements, modifications or enhancements to the foregoing made by or on behalf of Kin Yat.

1.23    “Intellectual Property Rights” means, collectively, all rights in, to and under patents, trade secret rights, copyrights, trademarks, service marks, trade dress and similar rights of any type under the laws of any governmental authority, including without limitation, all applications and registrations relating to the foregoing.

1.24    “iRobot Intellectual Property” means all Intellectual Property, tangible embodiments thereof and all other materials provided or made available to Kin Yat by iRobot, including, without limitation the Specifications.

1.25    “iRobot Property” means all property, including all Product and Consigned Components, other Components paid for my iRobot, inventories, work in process (WIP), Loaned Equipment, Specifications, test equipment, software and documentation, and support maintenance or design documentation, furnished to Kin Yat by iRobot or otherwise paid for by iRobot in connection with this Agreement for Kin Yat’s use in performing its obligations hereunder.

1.26    “iRobot Quarter End” means iRobot’s fiscal calendar which follows the 4-4-5 week format identified in Schedule 6, which Schedule shall be updated by iRobot on an annual basis on or before December 1st.

1.27    “Lead-time” means the mutually agreed upon minimum amount of time in advance of shipment that Kin Yat must receive a Purchase Order in order to deliver Product by the requested delivery date.

1.28    “Loaned Equipment” means capital equipment (including tools) which is loaned to Kin Yat by or on behalf of iRobot to be used by Kin Yat to perform the Manufacturing Services and includes all equipment, tools and fixtures purchased specifically for iRobot, by Kin Yat, to perform the Manufacturing Services and that are paid for in full by iRobot.

1.29    “Manufacturing Services” means the services performed by Kin Yat hereunder which shall include but not be limited to manufacturing, testing, configuring, assembling, packaging and/or shipping of the Product, and all Reasonable and Customary Support Services, and any Additional Services, all in accordance with the Specifications.

1.30    “Marks” means trademarks, service marks, trademark and service mark applications, trade dress, trade names, logos, insignia, symbols, designs or other marks identifying a Party or its products.

1.31    “Materials Declaration Requirements” means any requirements, obligations, standards, duties or responsibilities pursuant to any environmental, product composition and/or materials declaration laws, directives, or regulations, including international laws and treaties regarding such subject matter; and any regulations, interpretive guidance or enforcement policies related to any of the foregoing, including, but not limited to, the following examples:  Directive 2002/95/EC of the European Parliament and of the Council of 27 January 2003 on the restriction of the use 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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of certain hazardous substances in electrical and electronic equipment (“RoHS”), Directive 2002/96/EC of the European Parliament and of the Council of 27 January 2003 on waste electrical and electronic equipment (“WEEE”), and European Union Member State implementations of the foregoing; the People’s Republic of China (PRC) Measures for the Administration of the Control of Pollution by Electronic Information Products (China RoHS) (电子信息产品污染控制管理办法) promulgated on February 28, 2006 (including any pre-market certification (“CCC mark”) requirements thereunder and including relevant standards adopted by the PRC Ministry of Information Industry or other applicable PRC authority); PRC General Administration of Quality Supervision, Inspection and Quarantine’s Circular 441 (2006); Japanese Industrial Standard C0950:2005(J-Moss Japan RoSH); the California Electronic Waste Recycling Act of 2003; Act on the Recycling of Electrical and Electronics Equipment and Automobiles (1.1.2008) (Korea RoHS), Waste Act (2004) and secondary legislation (based on EU directives ) (Croatia), Regulation (EC) No 1907/2006, Regulation concerning the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH), establishing a European Chemicals Agency amending Directive 1999/45/EC and repealing Council Regulation (EEC) No 793/93 and Commission Regulation (EC) No 1488/94 as well as Council Directive 76/769/EEC and Commission Directives 91/155/EEC, 93/67/EEC, 93/105/EC and 2000/21/ECand/or other similar legislation. The Materials Declaration Requirements shall include compliance with Brazil RoHS, Mexico RoHS and Argentina RoHS as each of these countries promulgates their own legislation.

1.32    Conflict Minerals.
Kin Yat represents and warrants that it is in full compliance with conflict minerals laws, including, without limitation, Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 as it may be amended from time to time and any regulations, rules, decisions or orders relating thereto adopted by the Securities and Exchange Commission or successor governmental agency responsible for adopting regulations relating thereto (collectively, “Dodd-Frank Section 1502”).  Kin Yat must cooperate with iRobot to make available to iRobot and/or its agents, material declarations that identify the sources of and amount of all substances contained in the Products. Unless iRobot specifically agrees in writing that a particular Product may contain a particular material, Kin Yat will also provide a statement that the Products do not contain various materials at issue in applicable laws and regulations. Kin Yat must declare each Product’s compliance to all applicable hazardous material legislation and identify any substances that are banned or must be declared under applicable laws. In addition, Kin Yat will use Commercially Reasonable Efforts to make available documentation that supports the declaration. Without limiting the generality of the foregoing, Kin Yat agrees to disclose to iRobot, upon iRobot’s request, to the extent known or discoverable by Kin Yat following reasonable inquiry, the original source of all minerals contained in the Product. If Kin Yat does not know the original source of the minerals, Kin Yat agrees to cooperate with iRobot, including disclosing from whom Kin Yat purchased the minerals and urging others to disclose such information, so that the original source of minerals can be accurately determined and reported. Kin Yat shall comply with all laws regarding the sourcing of minerals, including, without limitation, laws prohibiting the sourcing of minerals from mines controlled by combatants and Dodd-Frank Section 1502.  Without any further consideration, Kin Yat shall provide such further cooperation as iRobot may reasonably require in order to meet any obligations it may have under conflict minerals laws, including, without limitation, under Dodd-Frank Section 1502.

1.33    “Minimum Volume” means the minimum volume, if any, set forth on Schedule 1 for a particular Product.

1.34    “Newly Created Intellectual Property” means, other than the Kin Yat Intellectual Property, any and all Intellectual Property, tangible embodiments thereof and all other materials created, developed, reduced to practice, or otherwise resulting from any work, Manufacturing Services or other services performed by either or both Parties, including, but not limited to, by any of its or their employees, agents or contractors, under this Agreement.

1.35    “Non-Conforming Product” means any Product that does not conform to the Specifications.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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1.36    “Non-Disclosure Agreement” means that certain Mutual Non-Disclosure Agreement between the Parties dated August 29, 2006, attached hereto as Schedule 4.

1.37    “NRE Costs” shall consist of expenses, excluding the Waived NRE Costs, incurred by Kin Yat under this Agreement, including design engineering services, testing, fixturing and tooling and other out-of-pocket costs, in each case for work performed by Kin Yat for iRobot pursuant to iRobot’s prior written consent.  For the avoidance of doubt, NRE Costs shall not include any costs or expenses incurred by Kin Yat for any Reasonable and Customary Support Services.

1.38    “Port of Origin” means [***] or another port designated by iRobot in writing.

1.39    “Packaging and Shipping Specifications” means the packaging and shipping specifications set forth in Schedule 1 and otherwise supplied and/or approved by iRobot.

1.40    “Person” means any corporation, business entity, natural person, firm, joint venture, limited or general partnership, limited liability entity, limited liability partnership, trust, unincorporated organization, association, government, or any department or agency of any government.

1.41    “Product Specifications” means the technical specifications and requirements provided by iRobot to Kin Yat for the manufacture and supply of Products or the provision of Manufacturing Services, including all manufacturing information, technical data and manuals, design information, drawings, documentation, packaging requirements, testing requirements, Specifications, or any other criteria written and provided to Kin Yat by iRobot, including the Quality and Test Procedures, the Packaging and Shipping Specifications, and the Materials Declaration Requirements.

1.42    “Products” means the products manufactured and assembled by Kin Yat on behalf of iRobot under this Agreement as identified in Schedule 1 (or any subsequent Schedule 1 prepared for any product to be manufactured hereunder) including any updates, renewals, modifications or amendments thereto. 

1.43    “Production Start Date” means the first day immediately following the business week during which Kin Yat manufactures and delivers against  the product quantities listed in Schedule 1 

1.44    “Proprietary Information and Technology” means “Proprietary Information” as defined in the Non-Disclosure Agreement, as amended in Section 16 below.

1.45    “Reasonable and Customary Support Services” mean all services and activities related to reporting for iRobot and its customers, root cause analysis, testing, trials, inventory audits and reconciliation, development and delivery of samples, participation and support of any new Product introduction.

1.46    “Product” means any and all configurations of the “Product” SKUs manufactured and assembled by Kin Yat on behalf of iRobot under this Agreement as identified in the initial Schedule 1 to this Agreement.

1.47    “Specifications” means the technical specifications for manufacturing Products under this Agreement as set forth in Schedule 1, any bill of materials, designs, schematics, assembly drawings, process documentation, test specifications, current revision number, and Approved Vendor List, and other requirements otherwise supplied and/or approved by iRobot.  Specifications may be amended from time to time by amendments in the form of written engineering change orders agreed to by the Parties.

1.48    “SOW” means the statement of work for each Product set forth in any Schedule 1 as amended in writing from time to time upon mutual agreement of the Parties.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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1.49    “Subsidiary(ies)” means any corporation, partnership, joint venture, limited liability entity, trust, association or other business entity of which a Party or one or more of its Subsidiaries, owns or controls more than 50% of the voting power for the election of directors, managers, partners, trustees or similar parties.

1.50    “Suppliers Designated by iRobot” means suppliers designated, specified and/or approved by iRobot.

1.51    “Technical Manufacturing Information – KIN YAT” means the manufacturing information, process and technology used by Kin Yat or third parties under its control to design, develop, test or manufacture the Products including, but not limited to: (i) specifications, software, test software, schematics, drawings, designs, mask works, topography or other materials pertinent to the most current revision level of manufacturing of the Products; (ii) copies of all inspection, manufacturing, test and quality control procedures and any other work processes; (iii) jig, fixture and tooling designs; (iv) Kin Yat general knowledge and information relating to the Products; and (v) support documentation.

1.52    “Term” means the Initial Term and each Renewal Term, collectively.

1.53    “Quality and Test Procedures” means the testing specifications, quality requirements, standards, procedures and parameters supplied and/or approved by iRobot, including without limitation, the specifications and quality requirements plans for the Product and certain Components attached hereto as Schedule 3.

1.54    “Waived NRE Costs” means, collectively, [***].

2List of Schedules.  This Agreement includes the following Schedules for each Product to be manufactured hereunder, which are hereby incorporated herein and made a part of this Agreement:

Schedule 1 – Statement of Work and Specifications
Schedule 2 – Fee and Price Schedule (Final Kin Yat Quote)
Schedule 3 – Quality and Test Procedures
Schedule 4 – Non-Disclosure Agreement
Schedule 5 – Trademark Usage Guidelines
Schedule 6 – iRobot Quarter End

3Manufacturing Services.  Kin Yat will manufacture the Product in accordance with the Specifications and any applicable Purchase Order.  When requested by iRobot, and subject to appropriate fee and cost adjustments, Kin Yat will provide Additional Services for existing or future Product manufactured by Kin Yat for iRobot.  iRobot shall be solely responsible for the sufficiency and adequacy of the Specifications.  

3.1    Quality and Test Procedures.  All Products manufactured and supplied by Kin Yat shall, at minimum, adhere to this Agreement and the Specifications attached hereto.  Kin Yat shall continuously perform the applicable quality tests and procedures and monitor such compliance at all times, including during the preparation for production as well as during production.  In addition to the minimum required tests specified, Kin Yat shall employ its own internal quality system and apply the necessary tools, processes and procedures to ensure that the contracted Product covered by this Agreement complies with the Specifications. This may include, but not be limited to, process control for parts and assemblies, incoming inspection of fabricated or sourced parts, final inspections, subassembly inspections and testing, etc.  iRobot shall be solely responsible for the sufficiency and adequacy of the Specifications. Kin Yat is responsible for designing and/or purchasing and maintaining all necessary test and fixture equipment to conduct such testing and procedures. Kin Yat is responsible for worker’s training, worker’s instructions, preventive and/or on-conditional (as needed) maintenance plans, and calibration plans. 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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3.2    Packaging and Shipping.  Kin Yat will package and ship the Product in accordance with the Packaging and Shipping Specifications.  iRobot shall be solely responsible for the sufficiency and adequacy of the Packaging and Shipping Specifications. In the event Kin Yat fails to comply with the Packaging and Shipping Specifications, Kin Yat will reimburse iRobot for the cost of rework to the extent that such error can be rectified with rework. 

3.3    Items to be Supplied by iRobot.  iRobot shall supply to Kin Yat, according to the terms and conditions specified herein, iRobot Proprietary Information and Technology and, if applicable, the Loaned Equipment if any, and Consigned Components pursuant to Section 12.1. iRobot will also provide to Kin Yat all Specifications, Quality and Test Procedures, Packaging and Shipping Specifications, Product design drawings, approved vendor listings where applicable, material component descriptions (including approved substitutions), manufacturing process requirements, and any other specifications necessary for Kin Yat to perform the Manufacturing Services.  iRobot shall be solely responsible for delay in delivery, defects and enforcement of warranties related to the Consigned Components.

3.4    Items to be Supplied by Kin Yat.  Kin Yat will employ the Kin Yat Manufacturing Process, the Reasonable and Customary Support Services, any required manufacturing technology, manufacturing capacity, labor, manufacturing and quality related fixtures, design services in support of manufacturing process (to include fixture design), transportation logistics (as required by FCA Port of Origin), systems and facilities necessary for Kin Yat to perform the Manufacturing Services.  It is expected that engineering support (at Kin Yat’s expense) of product, packaging and process improvements will continue for the life of the Product, even after all requirements are met. Tooling that is designed and fabricated specific to manufacture, assembly, inspection or testing of iRobot Product is the sole property of iRobot, including related design documentation

3.5     Facilities Access.  iRobot shall have the right, during normal business hours by appointment and at its expense to inspect, review, monitor and oversee the Manufacturing Services, provided that such inspection shall not disrupt Kin Yat’s normal business operations.  iRobot shall cause each of its employees, agents and representatives who have access to Kin Yat’s facilities, to maintain, preserve and protect all Proprietary Information and Technology of Kin Yat and the confidential or proprietary information and technology of Kin Yat’s other customers in accordance with the Non-Disclosure Agreement.  iRobot shall further have the right to bring iRobot’s customers to Kin Yat’s facility, by appointment and under the same obligations to Kin Yat surrounding protection of Kin Yat’s Proprietary Information and Technology and Kin Yat’s customers’ confidential or proprietary information and technology. iRobot’s employees have the right to obtain relevant artifacts (such as reports, process tracking charts etc.) and take photographs and videos of iRobot related Products, Components, manufacturing processes, tests, fixtures, tools or items at any time during the inspection with the consent of Kin Yat whose consent shall not be unreasonably withheld.

3.6    Materials Procurement. 

3.6.1    Kin Yat will use Commercially Reasonable Efforts to procure Assigned Components and Generic Components from the applicable designated supplier per iRobot’s AVL, where applicable, and otherwise from suppliers chosen by Kin Yat and approved by iRobot, in amounts necessary to fulfill Purchase Orders against the Forecasts.  Kin Yat will be responsible for the quality inspection of all Components (except for the Consigned Components) and all other parts and adherence to the Product Specifications in the assembly and manufacturing process.  iRobot will be responsible for the part functionality set forth in the iRobot Specifications.  Kin Yat is responsible for managing, and the performance of, the suppliers of the Assigned Components and Generic Components, including but not limited to purchasing, component inventory control, customs paperwork and Value Added Tax (VAT), and is ultimately responsible for verifying that all Components conform to the Product Specifications.  iRobot will be responsible for managing the pipeline of iRobot controlled Consigned Components.  Kin Yat will be responsible for managing the pipeline of all Assigned Components, Generic Components, and any Consigned Components controlled by Kin Yat.  Kin Yat shall use Commercially Reasonable Efforts to obtain terms and conditions that from all suppliers that allow return privileges for Generic Components (subject to agreed upon reasonable minimum order quantities).  iRobot may authorize Kin Yat to procure Generic Components and Assigned Components necessary, without a Purchase 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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Order, by issuing a written authorization to purchase such Components (“Material Authorization”), to meet specific Forecast or Purchase Order demand.  In the event of schedule changes, Kin Yat shall use Commercially Reasonable Efforts to cancel all applicable material and parts purchase orders and reduce material and parts inventory through return for credit programs or allocate such materials and parts for other customer orders. iRobot shall be responsible for all liability for materials and parts Kin Yat cannot return or reuse elsewhere after Commercially Reasonable Efforts to mitigate such liability, if those materials were ordered by Kin Yat acting on iRobot’s Material Authorization or Purchase Order.  Kin Yat’s obligation to exercise Commercially Reasonable Efforts to return/reuse any materials shall extend to all Components (except for the Consigned Components not controlled by Kin Yat) regardless of classification.  

3.6.2    End of Life Component Reporting. Kin Yat is responsible for continuous monitoring of the AVL for end-of-life component condition. Kin Yat is responsible for periodic reporting, no less frequently than [***] of the market condition for each component of any currently in production by iRobot’s product AVL.

3.6.3    Long-Lead Components.  Kin Yat shall not purchase any Component designated in Schedule 2 as a “long lead” Component by iRobot without a Material Authorization. Kin Yat shall use Commercially Reasonable Efforts to continuously improve lead time for all Components.  With iRobot’s prior written consent, Kin Yat may pre-purchase Generic Components and Assigned Components, or pre-build sub assemblies, modules, core robots or even completed SKU quantities in order to meet Forecast volumes, or anticipated volumes under Purchase Orders.

3.6.4    Exclusive Components.  With respect to any Assigned Components or Consigned Components (controlled by Kin Yat) that have been customized by a supplier or manufacturer specifically for any iRobot Product, Kin Yat shall require each such supplier not to sell or supply such custom Component to any other Person.

3.7    Materials Declaration.

3.7.1    iRobot shall notify Kin Yat in writing of the specific Materials Declaration Requirements that iRobot determines to be applicable to the Products and shall be solely liable for the adequacy and sufficiency of such determination and information.  Kin Yat shall be responsible for collecting, and having available at all times, all third party supplier’s documentation certifying compliance with such Materials Declaration Requirements with respect to any and all components, parts or material used in connection with the Manufacturing Services under this Agreement.  Kin Yat shall utilize its supplier qualification process to ensure that each supplier, its Components and its documentation are trustworthy and in compliance with all such Materials Declaration Requirements.  Upon written request of iRobot, Kin Yat shall provide to iRobot copies of such documents, including any compliance certificates. 

3.7.2    Without limiting the foregoing Section 3.7.1, Kin Yat shall ensure that it has enforceable agreements with each of its suppliers under this Agreement, excluding suppliers of Consigned Components, so that Kin Yat may fulfill Kin Yat’s obligations under this Section 3.7.1 and that iRobot is an intended third party beneficiary under such agreements.  

3.8    Product Evaluation. Acceptance of the Product will occur upon iRobot’s or its designee’s receipt of the Product.  Notwithstanding the foregoing, iRobot reserves the right to inspect or evaluate the Product to determine if it conforms, in all material respects, to the Specifications, either at Kin Yat’s premise or third party location.  Given reasonable and adequate advance notification to Kin Yat and by appointment, iRobot may, at its discretion, perform inspections of the Product at random or on a continual basis, on site at Kin Yat’s premises. In the event that the Product does not meet the Specifications, such Product will be deemed Non-Conforming and iRobot will have all available remedies with respect to Non-Conforming Products as set forth in this Agreement.   Acceptance, inspection or evaluation by iRobot does not relieve Kin Yat of its obligations to the services and warranties as set forth in this Agreement.

3.9    Purchase Order Performance.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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3.9.1    Kin Yat shall fill and deliver the Products purchased under a Purchase Order by the due date specified on such Purchase Order.  Purchase Orders to Kin Yat will be launched at lead-times mutually agreed between Kin Yat and iRobot in advance of issuance of Purchase Orders. 

3.9.2    Kin Yat agrees that time is of the essence with respect to all deliveries and performance.  If Kin Yat fails to timely perform or deliver within [***] of the delivery requirements of any standalone Purchase Order from iRobot, for reasons under Kin Yat’s direct control, Kin Yat is liable to iRobot for all direct, reasonable costs incurred as a result of such delay including expediting costs. In the event of a delay, Kin Yat shall use Commercially Reasonable Efforts to expedite delayed Products and/or performance, shall pay all reasonable expediting costs, including expedited delivery costs.

3.9.3    For purposes of this Agreement, “On–time” delivery means: delivery of 100% of the Products purchased under a Purchase Order are delivered by the due date indicated on iRobot’s Purchase Order for such Products minus  [***], plus [***].  Kin Yat will monitor and report to iRobot monthly “On-time” delivery per Purchase Order, and such report shall include the number of Purchase Orders placed by iRobot within the Lead Time versus number of Purchase Orders delivered On-time.

3.10    Assigned and Consigned Components. 

3.10.1    iRobot may elect to assign a specific supplier and part number for any component or material, including for example; rechargeable batteries, battery chargers, masked IC components, motors, packaging material, and gears.  In such case, Kin Yat shall source such Assigned Components from the applicable supplier and implement supply optimization inventory practices.  Kin Yat will be responsible for all purchasing, quality control, component inventory control, [***] inventory management, customs paperwork and VAT for all Assigned and Generic Components. Kin Yat shall handle all Components as required by the Product Specification and as otherwise instructed by iRobot, and shall be responsible for any and all expenses related to its compliance with such material handling requirements.  In the event that iRobot elects to transfer to Kin Yat the purchasing responsibility for any Consigned Component, Kin Yat shall assume such responsibility as soon as reasonably practicable.  The Parties will work in good faith to identify and implement all reasonable measures to allow for Kin Yat to assume such purchasing responsibility for such Consigned Component.  Except for any Consigned Components controlled by Kin Yat pursuant to this Section 3.10.1, iRobot shall be solely responsible for delay in delivery, defects and enforcement of warranties related to all Consigned Components.

3.10.2    Kin Yat will segregate, conspicuously identify and safeguard all iRobot owned and Consigned Components in such fashion to clearly identify the Consigned Components as the property of iRobot.  Kin Yat shall maintain all Components, at its own expense, in efficient working order and good repair, and otherwise in accordance with the Product Specifications. 

3.10.3    Upon placement of Consigned Components into Kin Yat’s facility, title and possession of the materials shall transfer to iRobot as if it were an actual shipment of Product to iRobot.  Insurance covering the Consigned Components will be the responsibility of iRobot. Such insurance includes a waiver of subrogation against Kin Yat.  Kin Yat shall hold inventory on consignment for support of iRobot’s Products and business at levels mutually agreed upon by iRobot and Kin Yat, but no less than an amount to satisfy Purchase Orders against the current Forecasts.  Kin Yat will at all times utilize [***] inventory management for all Consigned Components.  In the event that Kin Yat’s failure to utilize [***] inventory management for all Consigned Components results in any such Component remaining in Kin Yat’s inventory for more than [***], then Kin Yat shall, at its own expense, coordinate with the applicable supplier for the return and replacement of such Components for new or properly updated Components.  If “iRobot” does not place Purchase Orders that consume Consigned Components consistent with applicable Forecast, the Parties will negotiate in good faith the disposition of Consigned Components held by Kin Yat.  Kin Yat shall provide to iRobot upon request an accounting of all Consigned Components and all other Components, Products and materials of iRobot at Kin Yat’s premises or otherwise under Kin Yat’s control with reasonable details. 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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3.10.4    Sales of Products and Components. Without iRobot’s prior written consent, Kin Yat shall not, directly or indirectly, sell, supply or otherwise transfer any Product or Component to any Person other than iRobot or iRobot’s designated customer or distributor.

4Quality

4.1    Governing Quality documents.

4.1.1    General Quality Requirements.  Kin Yat shall comply with the requirements stated therein for defining general iRobot supplier quality performance.

4.1.2    Production Line Test Specification (PLTS).  The PLTS is provided to Kin Yat by iRobot in order for Kin Yat to establish a production line test process to verify and to demonstrate that the contracted product has been assembled and minimally tested to meet the product requirements as defined in the relevant product specifications

4.1.3    Design Validation Test Specification (DVTS).  Suppliers who provide design services to iRobot shall demonstrate that the contracted product has been designed and qualification tested according to the DVTS to meet the performance requirements of its intended application as defined in the relevant product specifications.

4.2     Quality Management System.  Kin Yat shall maintain a Quality System that is certified to an internationally recognized quality management system standard, such as ISO 9001 or equivalent. 
4.3     Engineering Changes.  Kin Yat shall not make any changes to product or design without receiving prior written approval from iRobot for the change request and for implementation of the change into production.
4.4.     Manufacturing Changes.  Kin Yat shall not make any changes to the manufacturing process that may affect the product form, fit, function or safety without receiving prior written approval from iRobot.
4.5     Defects.   Defects in product resulting in failure to meet iRobot product specifications, due to inadequate assembly procedures and production verification testing are the responsibility of the Kin Yat regardless of whether the defect occurred during manufacturing or after iRobot acceptance.    
4.6    Corrective Action.  In the event that defects are produced, Kin Yat shall notify iRobot and implement containment activities to prevent further defective product from affecting iRobot supply chain.  For defective product within Kin Yat’s supply chain, Kin Yat shall make necessary arrangements, at its sole expense, to screen, rework and / or replace.  Kin Yat shall supply to iRobot a written corrective action plan of its root cause(s) investigation and actions to prevent recurrence of identified root cause(s)
4.7     Quality Control Plan (QCP).  Kin Yat shall develop a Quality Control Plan (QCP), approved by iRobot, to define the necessary process controls and production testing and inspection methods to ensure the fabrication and assembly processes deliver products that meet the Specifications supplied by iRobot.
4.8      Subcontractor Qualification. Kin Yat shall be responsible for qualifying all  subcontractors of all Assigned Components and Generic Components pursuant to Kin Yat’s existing qualification methodology and process. 
4.9     Serial Number identification and traceability.  Kin Yat shall identify each unit of the contracted product produced with a unique identifier number.  This serial number shall provide information relevant to the date of production, shift, line, and traceability to critical component lots/batches and processes.    The format of this serial number shall be agreed upon between Kin Yat and iRobot prior to commencement of production. 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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4.10    Certifications. Regulatory compliance certifications are required as a condition for the production, shipment, sale, and disposal of all iRobot products, and as such, iRobot is obligated to maintain a commitment to meeting all regulatory compliance requirements.  As a condition of the compliance certification process, the Products and Kin Yat’s manufacturing facility shall be subject to periodic audits and certification testing.  Kin Yat shall provide objective evidence that it meets such requirements pertaining to all regulatory, quality, and compliance requirements and will provide such information upon request from iRobot.  Objective evidence shall include, but is not limited to, existing certification documents and certification inspection reports from Kin Yat and each of its suppliers.
4.10.1 Product Specific Certifications. iRobot is responsible for maintaining all existing product certifications.  Kin Yat shall comply, and shall cause its suppliers to comply, with any and all Product specific, certification-related requirements such as: informing iRobot of the source and manufacturing part number of every Component and validation that Kin Yat’s processes are compliant to such certification requirements.  Kin Yat shall support all recertification requirements for all Product certifications.  All Product licenses and Product certifications shall be in iRobot’s name.  In the event that iRobot requires Product changes which result in Product recertification, iRobot will bear any licensing and external testing fees for all such Product certifications.  In the event that Kin Yat requires Product changes which result in Product recertification, Kin Yat will notify iRobot immediately and bear any licensing and external testing fees for all product certifications.

4.10.2    Manufacturing Facility Specific Certifications. Kin Yat shall support and maintain any pre-requisite site specific requirements related to the Product certification requirements.  Kin Yat shall bear any fees associated with these pre-requisite site specific certifications.  All pre-requisite site specific certifications shall be maintained in Kin Yat’s name.  In the event that iRobot requires product or business changes which result in additional site specific certifications by Kin Yat, Kin Yat shall promptly take all actions necessary to comply with such requirements.  In addition, Kin Yat shall promptly execute documents and take such further action as iRobot shall reasonably request in order to comply with any certification required by any customer or distributor of iRobot.  
4.10.3    Records Retention.  For a period of [***] from delivery of each Product (items produced under the [***] are considered Product), Kin Yat shall maintain accurate and complete records for all Products manufactured hereunder, including, but not limited to, all configuration and engineering records.  This shall include all records relating to product traceability to ensure both forward and reverse traceability.  Records shall contain, as a minimum, all information relating to the following:
[***]

4.10.4    Product specification and standards. All Products must conform in all respects to the Product Specifications provided by iRobot for the items stated on the bill of materials or Purchase Order.  Any Kin Yat proposed change to Product requires mutual agreement in writing prior to implementing such change.  Kin Yat shall notify iRobot in writing and receive approval of any changes to Components, other materials, parts or sources of supply, process chemistries, test procedures, quality reporting or other major processes, and to ensure that any such changes do not compromise the requirements under this Agreement or the Specifications, quality, or reliability of Products ordered, or which may affect form, fit or function.

4.10.5    Secure Testing Facility.  Kin Yat shall provide intellectual property secure on-site facilities for iRobot’s final inspection quality control team, as well as the necessary inspection technicians to assist during inspections.

4.11    Returned Products.  Kin Yat shall establish a program for analyzing Product returns and for tracking Product return rates and failure types. Kin Yat will utilize iRobot provided Return product information in such analysis and tracking.  Kin Yat shall provide objective evidence to demonstrate appropriate corrective actions, as needed, to address Product Returns root cause.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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4.12    Recalls. If iRobot reasonably decides to, or is required by any government authority or court of competent jurisdiction to, initiate a product recall, withdrawal or field correction with respect to, or if there is any governmental seizure of, any Product, iRobot will notify Kin Yat of the details regarding such action, including providing copies of all relevant documentation concerning such action.  Kin Yat will assist iRobot in investigating any such situation and all regulatory contacts that are made and all activities concerning seizure, recall, withdrawal or field correction will be coordinated and made by iRobot, and all communications in connection with any recall, shall come solely from iRobot.  If any such recall, withdrawal, field correction or seizure results from (i) failure of any Product to conform to the Specifications or any warranty or other requirement set forth in this Agreement, or (ii) the failure of Kin Yat to comply with any applicable law, rule, regulation, standard, court order or decree or (iii) the gross negligent or intentional wrongful act or omission of Kin Yat in connection with the production of Product hereunder, then, in addition to the rights, remedies and obligations under Section 5, Kin Yat shall be responsible for the full cost and expense of any such seizure, recall, withdrawal or field correction.  For the purposes of this Agreement, the expenses of any recall, withdrawal, field correction or seizure shall include, without limitation, the out-of-pocket expenses of notification and destruction or return of the recalled Product and all other out-of-pocket costs incurred in connection with such recall, in addition to any lost profits of either Party under any circumstances or any administrative or overhead charge.

		
	5
	Warranty & Remedy.

5.1    Kin Yat Warranty. [***] warranty period.

5.1.1    Product Warranty. Kin Yat represents, warrants and covenants that: (i) it will perform the Manufacturing Services and manufacture the Product in accordance with IPC-A 610 Class 2 workmanship standard, the Product Specifications, applicable law, and the terms and conditions of this Agreement, (ii) the Products will be manufactured, processed and assembled by Kin Yat, and be free from defects in workmanship in accordance with the Product Specifications, (iii) the Products will conform, in all material respects, to the Product Specifications, be new or newly manufactured and include only new Components, and (iv) the Products will be free and clear of all Encumbrances. The foregoing warranty shall apply to any Product that is repaired or re-manufactured by or on behalf of Kin Yat under this Agreement. This Product warranty is extended to, and may only be enforced by, iRobot. 

5.2    Components Warranty.  Kin Yat will pass on to iRobot all warranties from Component suppliers to the extent that they are transferable. Kin Yat shall use Commercially Reasonable Efforts to ensure that all Assigned Components used in the Product are procured from suppliers on the AVL, unless otherwise agreed to by the Parties in writing.

5.3    Survival of Warranty.  Product warranties will survive any inspection, delivery, acceptance or payment by iRobot and be in effect for the longer of (i) [***] from the date of invoice of the Product from Kin Yat to iRobot, (ii) for Products purchased by an end-user customer within [***] from the date such Product is initially delivered to iRobot or to iRobot’s designated carrier, [***] of the warranty period from iRobot to such end-user customer for such Product, or (iii) such other term as agreed to by the Parties, following the date such Product is initially delivered to iRobot or to iRobot’s designated carrier (such period, the “Warranty Period”).  Should there be a breach of any of the warranties specified during the Warranty Period, Kin Yat will either (A) repair or replace the Product that contains a defect caused by a breach of the warranty set forth herein; or (B) issue a credit to iRobot in an amount equal to [***]. Product warranties will survive for the full term of the Warranty Period, regardless of whether such Product becomes obsolete or whether Kin Yat ceases to manufacture such Product or ceases to provide the Manufacturing Services.

5.4    Repair or Replacement of Defective Product. Kin Yat may elect, in its sole discretion, to repair or re-manufacture any Non-Conforming Products caused by a breach of the warranty set forth in this Section 5.  Any such repair or re-manufacture shall be pursuant to Kin Yat’s standard return material authorization process and procedure (“RMA”), pursuant to which iRobot will request an RMA number from Kin Yat for such Non-Conforming Product.  

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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iRobot shall then consign the Non-Conforming Products along with objective documentation of the applicable breach of warranty (“Defect”), FOB Kin Yat’s repair facility in the same country and region as the Non-Conforming Products (or such other location as agreed to by the Parties in writing), and specify the Kin Yat assigned RMA number.  Kin Yat will repair or re-manufacture the Non-Conforming Products within [***] of receipt by Kin Yat of such Non-Conforming Products, and in the event the Defect is confirmed, Kin Yat will reimburse iRobot for the reasonable cost of transporting the Non-Conforming Products to Kin Yat’s designated facility and Kin Yat will deliver the repaired or re-manufactured Products, FCA iRobot’s designated destination.  If no such Defect is confirmed, iRobot shall reimburse Kin Yat for all fees, costs and expenses incurred to analyze and, if requested by iRobot, repair or re-manufacture the non-defective Products and iRobot shall bear responsibility for all transportation costs to and from Kin Yat’s designated repair facility. 

5.5    Class Failure.  In the event that Kin Yat is notified (such notification being oral or otherwise) of a Class Failure, Kin Yat shall:

5.5.1    Within 24 hours of learning of such Class Failure, provide iRobot with a status report and details of a proposed interim solution; and

5.5.2    No later than [***] following notification of such Class Failure, provide iRobot with a root cause analysis and corrective action plan.

In each of the foregoing cases, iRobot will make available such information and assistance reasonably required to allow Kin Yat to conduct its root cause analysis and to provide its corrective action plan.

5.6    Component Failures. In the event that a Non-Conforming Product is the result of a Component, Kin Yat will pass on to iRobot all available warranty remedies pursuant to Section 5.2. In addition, Kin Yat will negotiate with the Component suppliers (save for the suppliers of Consigned Component not controlled by Kin Yat), at iRobot’s discretion and with iRobot present or on iRobot’s behalf, for additional remedies outside of the Component warranty pursuant to Section 5.2.  Kin Yat shall not enter into any settlement with respect to Component failures that affects iRobot’s rights or interests without iRobot’s prior written approval, which shall not be unreasonably withheld.  In the event that such negotiations do not resolve the matter to iRobot’s reasonable satisfaction, and the available warranty remedies under Section 5.2 do not cover the full cost of Component repair or replacement, Kin Yat will provide iRobot with prior written notice regarding any additional costs required to repair or re-manufacture the affected Products. In the event that cost details are not readily available and iRobot requires immediate repair or replacement of the affected Products, iRobot may elect to authorize Kin Yat to proceed with repair or re-manufacture of the affected Products on a not to exceed basis. iRobot will be liable for any additional costs actually incurred by Kin Yat to repair or re-manufacture the affected Products, provided that iRobot has given Kin Yat written approval before such costs were incurred.

5.7    Refunds due to Class Failure or Recall. In the event any Class Failure or Recall of a Product results from a breach of any of the warranties under this Agreement during the Warranty Period, then Kin Yat shall promptly refund to iRobot the full purchase price paid for all Products subject to such Class Failure or Recall, and all other reasonable costs to cure the Class Failure or Recall (example: shipping costs, partner penalties etc).

5.8    Third Party Repair and Re-Manufacture; Other Defects. Notwithstanding anything to the contrary in this Agreement, iRobot may itself, or through a third party, and at its own expense, repair or re-manufacture any Product (whether or not such Product is defective) without any obligation or liability to Kin Yat.  If iRobot wishes Kin Yat to undertake repair or re-manufacture of Products that are Non-Conforming due to reasons other than a breach by Kin Yat of its warranty obligations hereunder, the Parties will mutually agree on an allocation of costs for the repair and/or re-manufacture process prior to Kin Yat performing such work.

5.9    Limitation of Warranty. 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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5.9.1    THE REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTION 5 AND 16.3 ARE IN LIEU OF, AND EACH PARTY EXPRESSLY DISCLAIMS, AND EACH OTHER PARTY EXPRESSLY WAIVES, ALL OTHER WARRANTIES AND REPRESENTATIONS OF ANY KIND WHATSOEVER WHETHER EXPRESS, IMPLIED, STATUTORY, ARISING BY COURSE OF DEALING OR PERFORMANCE, CUSTOM, USAGE IN THE TRADE OR OTHERWISE, INCLUDING ANY WARRANTY OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT OR MISAPPROPRIATION OF ANY RIGHT, TITLE OR INTEREST OF ANY PARTY OR ANY THIRD PARTY.  NO ORAL OR WRITTEN STATEMENT OR REPRESENTATION OUTSIDE OF THIS AGREEMENT BY EITHER  PARTY, ITS AGENTS OR EMPLOYEES SHALL CONSTITUTE OR CREATE A WARRANTY OR EXPAND THE SCOPE OF ANY WARRANTY HEREUNDER. 

5.9.2    KIN YAT’S WARRANTY SHALL NOT APPLY TO ANY PRODUCT THAT HAS BEEN SUBJECTED TO TESTING FOR OTHER THAN SPECIFIED ELECTRICAL CHARACTERISTICS OR TO OPERATING AND/OR ENVIRONMENTAL CONDITIONS IN EXCESS OF THE MAXIMUM VALUES ESTABLISHED IN IROBOT’S APPLICABLE SPECIFICATIONS, OR TO HAVE BEEN THE SUBJECT OF ANYONE OTHER THAN KIN YAT OR ITS AGENTS OR CONTRACTORS MISHANDLING, ACCIDENT, MISUSE, NEGLECT, IMPROPER TESTING, IMPROPER OR UNAUTHORIZED REPAIR, ALTERATION, DAMAGE, ASSEMBLY, PROCESSING OR ANY OTHER INAPPROPRIATE OR UNAUTHORIZED ACTION OR INACTION THAT ALTERS PHYSICAL OR ELECTRICAL PROPERTIES.  THIS WARRANTY SHALL NOT APPLY TO (a) ANY MATERIAL CONSIGNED OR SUPPLIED BY IROBOT TO KIN YAT INCLUDING BUT NOT LIMITED TO IROBOT INTELLECTUAL PROPERTY, IROBOT’S PROPRIETARY INFORMATION AND TECHNOLOGY AND IROBOT’S TOOLING, OR (b) ANY DEFECT IN THE PRODUCT  ARISING FROM ANY DRAWING, DESIGN, SPECIFICATION, PROCESS, TESTING OR OTHER PROCEDURE, ADJUSTMENT OR MODIFICATION SUPPLIED AND APPROVED BY IROBOT.

5.10    ECO Upgrade.  RMA’s for any engineering changes or upgrades under any ECR or ECN upgrades will also be subject to the RMA process. Kin Yat will analyze each ECR and ECN and provide a per unit upgrade/change cost and expected completion and delivery date.

5.11    The Liability of Kin Yat  to iRobot for any one act of default by reason of the breach of the warranty under this Agreement shall be limited to the extent that all or any damages (if proven) together shall in no event greater than [***] affected by such breach which has/have been received and accepted by Kin Yat and paid for by iRobot.

6Limitation Of Liability; Specific Performance; Equitable Relief 

6.1    EXCEPT WITH REGARD TO ANY LIABILITY THAT ARISES FROM A PARTY’S INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTION 19 OR A BREACH BY EITHER PARTY OF ITS CONFIDENTIALITY OBLIGATIONS SET FORTH IN SECTION 16, UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR TO ANY OTHER PERSON OR ENTITY UNDER ANY CONTRACT, TORT, STRICT LIABILITY, NEGLIGENCE, OR OTHER LEGAL OR EQUITABLE CLAIM OR THEORY FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL, OR INDIRECT DAMAGES, LOSS OF GOODWILL OR BUSINESS PROFITS, LOST REVENUE, WORK STOPPAGE, DATA LOSS, COMPUTER FAILURE OR MALFUNCTION, OR FOR ANY AND ALL OTHER EXEMPLARY OR PUNITIVE DAMAGES WHETHER SUCH PARTY WAS INFORMED OR WAS AWARE OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE.  THE FOREGOING SHALL NOT EXCLUDE OR LIMIT EITHER PARTY’S LIABILITY FOR DEATH OR PERSONAL INJURY RESULTING FROM ITS NEGLIGENCE TO THE EXTENT THAT SUCH LIABILITY CANNOT BY LAW BE LIMITED OR EXCLUDED.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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6.2    Kin Yat acknowledges and agrees that a breach by it of its obligations to perform the Manufacturing Services, including the manufacture and/or supply Product under this Agreement, would cause irreparable harm to iRobot because the Manufacturing Services are unique in kind and quality and, moreover, suitable substitutes are unobtainable or unreasonably difficult or inconvenient for iRobot to procure and Kin Yat further acknowledges and agrees that iRobot could not be adequately compensated by money damages. Accordingly, in addition to any other remedies that may be available, in law, in equity or otherwise, in the case of any such actual or threatened breach, iRobot shall be entitled to obtain specific performance (including an order of a court requiring that Kin Yat manufacture and/or supply Product under this Agreement), without the necessity of posting a bond or proving actual damages.  Finally, Kin Yat agrees that such equitable relief (including without limitation, specific performance), is a reasonable outcome of any actual or threatened breach contemplated by this Section 6.2, and Kin Yat hereby knowingly assumes the risk that a court or other tribunal may order specific performance. Kin Yat further acknowledges and agrees that any equitable relief ordered by a court or tribunal would not be a penalty.

6.3    iRobot retains all rights not expressly granted hereunder and any and all remedies herein expressly conferred upon iRobot will be deemed cumulative with, and not exclusive of, any other remedy conferred hereby, or by law or equity upon iRobot, and the exercise by iRobot of any one remedy will not preclude the exercise of any other remedy available under this Agreement or otherwise.

7Delivery, Risk of Loss and Payment Terms. For purposes of this Agreement terms of sale for all Product shipments shall be FCA Port of Origin. (per Incoterms 2010).  Risk of loss for Product shipments will pass to iRobot (or to iRobot’s designee invoiced by Kin Yat) upon delivery to the Port of Origin and receipt by the freight partner responsible for delivering the goods to the appropriate destination.  For any shipments where Kin Yat acts as an agent in completing the Shipper’s Export Declaration and managing iRobot’s exports on behalf of iRobot, where iRobot is the exporter of record (Principal Party in Interest - PPI), iRobot hereby grants Kin Yat a limited Power of Attorney to act on its behalf in managing its exports.  Title for Product will pass to iRobot upon receipt of full payment for the purchase price by iRobot.

7.1    Payment. iRobot shall pay Kin Yat all monies when due, including all NRE Costs associated with this Agreement.  Payment of all invoices shall be net [***] from date of iRobot’s receipt of each such invoice.  Payment to Kin Yat shall be in U.S. dollars and in immediately available funds.  Any equipment, tooling, component, material or other goods or property, which is purchased by Kin Yat in order to perform its obligations under this Agreement, shall become the property of iRobot once Kin Yat is reimbursed for all NRE Costs, if any.  Kin Yat shall be responsible for maintaining, segregating and CONSPICUOUSLY labeling the iRobot Property as “ iRobot PROPERTY” and carrying out applicable repairs based on reasonable wear and use. Kin Yat shall invoice iRobot for actual outstanding NRE Costs and other monies due at [***] intervals (or such other intervals as deemed appropriate) during the term of this Agreement and upon cancellation, termination or expiration of this Agreement.  Kin Yat agrees to request advance written approval from iRobot should resource requirements, and thereby NRE Costs, increase materially relative to estimated NRE Costs initially agreed by the Parties.  Upon such request, Kin Yat shall provide to iRobot reasonably detailed supporting documentation and/or descriptions of the NRE Costs for which Kin Yat seeks reimbursement. iRobot is not obligated to accept any additional reimbursement request from Kin Yat.  Unless otherwise agreed by iRobot, all prices are FCA, Port of Origin. 

7.2    Taxes.  iRobot shall be responsible for all federal, foreign, state and local sales, use, excise and other taxes (except taxes based on Kin Yat’s income), all delivery, shipping, and transportation charges and all foreign agent or brokerage fees, document fees, custom charges and duties.

7.3    Disputed Invoices. If a Kin Yat invoice does not meet the invoicing requirements of this Agreement, or iRobot in good faith disputes any invoiced charges, iRobot will notify Kin Yat of the disputed items in writing on or before the payment due date and may withhold payment of the disputed charges pending resolution of the dispute.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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7.4    Reservation of Rights. Any payments made by iRobot under the Agreement, and any acceptance of Products, will be without prejudice to iRobot’s right to subsequently claim or determine that it has overpaid Kin Yat or to require Kin Yat to remedy any deficiencies in KinYat’s performance as provided in this Agreement.

8Import and Export. iRobot shall be the importer of record for all Product shipments to iRobot facilities and shall be responsible for obtaining any required import licenses necessary for iRobot to import Product and/or receive shipments of Product from Kin Yat or its designated carrier, any U.S. Federal Communications Commission’s identifier, if applicable and any other licenses required under US or foreign law applicable to iRobot’s obligations under this Agreement.  Kin Yat shall be responsible for obtaining any required export licenses necessary for Kin Yat to ship Product, including certificates of origin, manufacturer’s affidavits, and U.S. Federal Communications Commission’s identifier, if applicable and any other licenses required under US or foreign law applicable to Kin Yat’s obligations under this Agreement.   iRobot agrees that it shall not knowingly require Kin Yat to ship or deliver any Product, assembly, component or any technical data or software which violate any export controls or limitations imposed by the United States or any other governmental authority, or to any country for which an export license or other governmental approval is required at the time of export without first obtaining all necessary licenses and approvals and paying all duties and fees.  Each Party shall be responsible for securing all applicable licenses, certifications, approvals and authorizations that are necessary for such Party to comply with applicable import and export laws, rules and regulations for the shipment and delivery of the Product under this Agreement. iRobot shall also be responsible for complying with any legislation or regulations governing the importation of the Product into the country of destination and for payment of any duties thereon.

9Cost Management. 

9.1    Cost Summary and Management.  The cost summary included set forth on Schedule 2, prepared by Kin Yat, contains a detailed SKU-level (SKU as defined by iRobot) cost summary, Incoterm FCA Port of Origin, complete with all formulas and assumptions, to provide full access and visibility to all component, labor, assembly and mark-up costs.  During each Renewal Term, the Parties shall meet from time to time on an executive level as required, but no less than on an [***], to identify cost reduction opportunities where each Party will share overall financial objectives of the on-going relationship between the Parties.  Kin Yat shall at all times employ an Open Book Pricing approach to cost management and pricing of Components, Products and the Manufacturing Services to achieve Sustainable and Competitive Pricing for the Products and Manufacturing Services provided to iRobot under this Agreement.  For purposes of this Agreement, the phrase “Sustainable and Competitive Pricing” means stable pricing over time for the Products and Manufacturing Services provided to iRobot under this Agreement that is favorable against that which could be reasonably attained from other contract manufacturers for comparable volumes of substantially similar products and comparable manufacturing services. For purposes of this Agreement, the term “Open Book Pricing” means providing detailed costing information to iRobot which includes; a fully-costed bill of materials, markups related to the sourcing and manufacturing of the Components and the Product and an explanation of all adders on material or value add (in place as of the Effective Date). In addition, Kin Yat shall provide detailed overviews of the relevant financial costing model to iRobot’s representatives and professional advisors. By [***], Kin Yat shall provide final fixed price quotation for upcoming iRobot fiscal year.

9.2    Price. The Price for each Product is set forth in Schedule 2 (the “Product Price”), and includes the complete price for such Product, including the fully-costed bill of materials, Kin Yat’s Gross Margin (as defined in Schedule 2), and any and all other added fees and costs related to the Manufacturing Services, Reasonable and Customary Support Services. The Product Price for each Product shall not be increased during the period beginning on the Effective Date and ending on [***], during such time Kin Yat shall manage its supply chain and absorb any and all increases.  Pricing will be reviewed by the Parties on an [***] basis, on or before [***], and will be revised consistent with increases or decreases in materials, components, equipment and other costs and expenses applicable to the manufacture of the Product.    By [***], Kin Yat shall provide final fixed price quotation for upcoming iRobot fiscal year.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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9.3    Source Transparency. Kin Yat will submit a full list of suppliers to iRobot for each Product at the time of any cost summary submittal, along with the supplier part number (in case of Generic Components).  Kin Yat will submit every supplier or part number change to iRobot for iRobot’s approval before such change goes into effect, including a summary or certification that such proposed changed part conforms to the Product Specifications.

9.4    Cost Transparency.  COGS (Cost of Goods Sold) is a key factor in iRobot engaging Kin Yat to produce and deliver the Product.  So that iRobot has full visibility to the current and ongoing status of Kin Yat’s COGS, Kin Yat will provide updated costing in the agreed upon format within [***] of any change submittal. If Kin Yat fails to provide cost impact information within [***] after any iRobot Specification changes, iRobot will consider the lack of response to mean that there is no cost impact. Any cost change would be considered valid only after iRobot’s approval. No less frequently than [***], Kin Yat will, upon iRobot’s request, provide a microeconomic report that includes all critical prices and costs included in the Product Price (such as labor, exchange rate or select material as required by iRobot).

10Tooling and fixtures.  iRobot shall own any and all tooling, fixtures, molds, equipment, software and firmware made available to Kin Yat by iRobot, developed for or on behalf of iRobot, or otherwise paid for by iRobot (“iRobot Tooling”).  Kin Yat may manufacture, have manufactured, and use the iRobot Tooling only to perform the Manufacturing Services under the Agreement and shall use and treat the iRobot Tooling with a high degree of care, and in any case no less than the same degree of care it would for its own equipment, tooling, molds or supplies.  Kin Yat shall attach an identifying label showing iRobot’s ownership in a conspicuous place on each unit of iRobot Tooling, if possible, and shall secure and segregate the iRobot Tooling in such fashion to clearly identify the iRobot Tooling as the property of iRobot.  Kin Yat shall maintain the iRobot Tooling, at its own expense, in efficient working order and good repair based on reasonable wear and use, and otherwise in accordance with iRobot’s reasonable instructions.  Kin Yat shall keep all iRobot Tooling free of any Encumbrances, and shall not transfer any iRobot Tooling, or any rights in the iRobot Tooling to any Person.  Kin Yat shall deliver all iRobot Tooling to iRobot or iRobot’s designee, or at iRobot’s request, make available for pickup, upon the termination or expiration of this Agreement, or upon iRobot’s earlier request. Kin Yat shall execute documents and take such further action as iRobot shall reasonably request to protect iRobot’s interest in the iRobot Tooling. Kin Yat will at the expense of iRobot deliver to iRobot any of the above mentioned tooling within [***] upon iRobot’s written request.  Kin Yat will adhere to the record keeping of iRobot Tools in accordance with iRobot requirements set forth in Section 4.10.3 or as otherwise described Schedule 1.  Kin Yat shall make such records available for inspection by iRobot or iRobot’s designee Kin Yat upon iRobot’s reasonable request.

		
	11
	Forecast, Purchase Orders; Change Orders, Rescheduling and Cancellation.

11.1    Forecast.  iRobot will provide to Kin Yat, on a [***], a non-binding, rolling [***] planning forecasts at a core robot level and on a SKU based level, indicating iRobot’s monthly Product requirements, as amended by iRobot from time to time (each, a “Forecast”).
 
11.2    Purchase Orders.  iRobot will issue orders for Products hereunder using its standard form of purchase order (“Purchase Order”). Each Purchase Order will identify the applicable Product by SKU, quantity, price denominated in US currency, delivery terms, and other customary terms.  Except for the Product Price and  delivery date contained in such Purchase Order, the terms and conditions in this Agreement shall prevail over any conflicting terms and conditions in any Purchase Order.  Such Purchase Orders will be issued by iRobot at least [***] prior to the date of ex-factory for all Products on each such Purchase Order. For select SKUs and as defined in Schedule 1, iRobot and Kin Yat will develop strategies to achieve [***] lead time.

11.3    Purchase Order Acknowledgment. Kin Yat will notify iRobot electronically within [***] if it utilizes EDI, or if in writing, within [***] of receipt of a Purchase Order, and inform iRobot in writing of any reason Kin Yat is unable to meet a requested delivery date or any other Purchase Order requirements.   The Purchase Order will not 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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constitute a binding obligation on Kin Yat until and unless Kin Yat accepts the Purchase Order in accordance with this Agreement.

11.4    Changes to Forecast: At any time, prior to the issue of a Purchase Order, iRobot may reschedule and/or cancel any forecast demand.

11.5    Changes to Manufacturing Services, Packaging and Shipping Specifications and Test Procedures. iRobot may, in writing, request a change to the Manufacturing Services, Packaging and Shipping Specifications and Test Procedures at any time.  Within [***] after receipt of iRobot’s written request Kin Yat will analyze the requested change and provide iRobot with an assessment of the effect that the requested change will have on cost, manufacturing, scheduling, delivery and implementation.  iRobot will be responsible for all costs associated with any accepted changes.  Any such change shall be documented in a written change order and shall become effective only upon mutual written agreement of both Parties to the terms and conditions of such change order, including changes in time required for performance, cost and applicable delivery schedules.

11.6    Production Increases, Rescheduling Delivery. iRobot may, in writing, request increases in production volume or acceleration of open Purchase Order at any time.  If Kin Yat is unable to satisfy or comply with iRobot’s requested increase in production volume within the requested time frame for delivery, Kin Yat will provide the reasons preventing Kin Yat from satisfying the requested increase within [***] after receipt of iRobot’s request.  Any such change shall be documented in a written change order and shall become effective only upon mutual written agreement of both Parties to the terms and conditions of such change order, including changes in time required for performance, cost and applicable delivery schedules.  Kin Yat shall utilize its global supply network to assess availability of shared material across accounts to minimize instances in which Kin Yat is unable to meet an increase in a Purchase Order quantity requested by iRobot. It is further understood that iRobot will not incur additional chargers due to Kin Yat’s decision to meet an accelerated delivery schedule or request for increased quantities by utilizing Generic Components from another account’s material.

11.7    Product Configuration Changes and Engineering Changes.  iRobot may request configuration or engineering changes to a Product in writing at any time.  Kin Yat will analyze the request and determine if it can meet the requested changes within the required Lead-time.  If Kin Yat can satisfy the requested change it will provide iRobot within [***] after receipt of the configuration or engineering request notice, a notice of acceptance of the requested changes.  In the event that any requested change in the form, fit or function or Specification of any Product results in a significant increase in the cost of such Product, or in the length of time required for the manufacture or delivery thereof, then Kin Yat shall provide iRobot with a detailed cost analysis regarding such requested change using Open Book Pricing as contemplated under Section 9.1.  Following iRobot’s acknowledgment of such detailed cost analysis, the Parties will negotiate in good faith an equitable adjustment to the price of such Product and/or expected changes to the delivery schedule for such Product.  If Kin Yat is unable to satisfy or comply with iRobot’s requested changes within the requested time frame for delivery, Kin Yat will provide the reasons preventing Kin Yat from satisfying the requested increase within [***] after receipt of iRobot’s request. Any such change shall be documented in writing and shall become effective only upon mutual written agreement of both Parties of the terms and conditions of such change, including changes in time required for performance, cost (including cost of materials on hand or on order in accordance with original Purchase Order) and applicable delivery schedules.

11.8    Treatment of Obsolete/End-of-Life Material. Upon receiving notice from iRobot of an engineering change or that any Product, component or assembly has become obsolete or has reached end-of-life, Kin Yat will, within a reasonable period after receiving such notice, provide iRobot with an analysis of iRobot’s liability to Kin Yat for components and materials acquired or scheduled to be acquired to manufacture such Product.  iRobot’s liability shall include the price of finished Product and Kin Yat’s costs (including cancellation fees and charges), plus applicable margin, of WIP, safety stock components and materials and components and materials on hand or on order within 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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applicable Lead-times.  Kin Yat will use Commercially Reasonable Efforts to assist iRobot in minimizing iRobot’s liability by taking the following steps:

		
	•
	As soon as is commercially practical reduce or cancel Component and material orders to the extent contractually permitted.

		
	•
	Return all Components and materials to the extent contractually permitted. 

		
	•
	Make all Commercially Reasonable Efforts to sell Components and materials to iRobot approved third parties.

		
	•
	Assist iRobot to determine whether current WIP should be completed, scrapped or shipped to iRobot or its designee “as is”.

11.9    Rescheduled Delivery out, reduction of quantity, and Cancellation of Orders. iRobot may request Kin Yat to reschedule the delivery date for any Product, decrease quantity on open Purchase Order, and cancel pending Purchase Orders in accordance with this Section. The charges to iRobot for deferring delivery of a Purchase Order, reducing quantity or cancellation of a Purchase Order are outlined below:

	
			
	Days Prior to
Delivery Date
	Reschedule
Terms
	Cancellation
Liability

	[***] Days
	Kin Yat is not obligated to adhere to the request, but must consider each request in good faith.
	iRobot may not cancel a  Purchase Order to be delivered within [***] days of the applicable delivery date without payment to Kin Yat for the work incurred to date.

	[***] Days from original delivery date
	iRobot may reschedule out the delivery, reduce quantity or cancel the order.

	Material on hand, non-cancelable and non-returnable materials, to the extent issued under a Material Authorization by iRobot, and applicable labor charges for WIP, provided, that such liability applies only to the extent that Kin Yat is unable to reallocate such material to any existing Purchase Order of iRobot, or, if authorized by iRobot, to a purchase order of another customer of Kin Yat.

Notwithstanding anything to the contrary in this Agreement, any reschedule out of a delivery date, reduction of quantity and/or cancellation of a Purchase Order (in whole or in part) will not affect any Product Price.

12Logistics.  Kin Yat will maintain control over all Products while in Kin Yat’s care, custody, and control. Kin Yats shall cooperate with iRobot and its suppliers and logistics services providers. Kin Yat will provide relevant and necessary information to iRobot relating to receipt, storing and shipment of Products. Kin Yat will coordinate with iRobot personnel, iRobot logistics services providers, and iRobot customers to execute the shipment of Products as instructed by iRobot.

12.1    Receiving.  From time to time iRobot may ship Components, including batteries and Integrated Circuits (IC’s, processors) directly to Kin Yat. Kin Yat will verify actual quantities and SKU’s of such Components received as compared to the quantities and SKU’s indicated on the shipping documents, process the Components into their inventory system, and notify iRobot of the quantity actually received by SKU.  Kin Yat will also indicate any exceptions, at the time of reporting the receipt, as related to over, short or damage. The reporting of receipts and exceptions is made to iRobot. 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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12.2    Storage and maintenance of inventory.  All Products and Components will be stored in a manner to maintain inventory control and to prevent damage as instructed by iRobot reasonably. Kin Yat will maintain inventories and locations of iRobot Products and Components on their own perpetual inventory and/or warehouse management system. Kin Yat and iRobot will compare on a monthly basis all inventories, reconcile results and Kin Yat will cycle count the Components with the five highest variances.

12.3    Physical inventory audit.  

12.3.1    On a [***] basis Kin Yat will arrange a cut-off date for and complete a physical inventory audit of all Consigned Components.  Because the [***] Components contain valuable intellectual property of iRobot, there is no shrinkage allowance for such Components. Variances will be identified and reported to Kin Yat by iRobot within [***] of the physical inventory. Within [***] of being notified of any such variance, Kin Yat shall provide iRobot a written report that, in iRobot’s sole discretion, explains the variance, or iRobot will charge or deduct from its next payment for the unexplained variance. All other Consigned Components are subject to a shrinkage allowance of [***]% of the volume of such Component or Product received during the [***] period immediately prior to the physical inventory audit.

12.3.2    On a [***] basis Kin Yat will arrange a cut-off date for and complete a physical inventory audit of all finished Products that have passed the applicable quality inspections, but remain unshipped and in Kin Yat’s possession at the end of such quarter.  Kin Yat shall deliver such audit report to iRobot by the second business day immediately following the end of each iRobot Quarter End.

12.4    Shipping to iRobot locations. Most of the Products are designed to withstand a maximum of two pallet high floor storage. Components, including chips and batteries must be single stacked on the floor or stored in pallet racks.  iRobot may direct Kin Yat to ship to specific iRobot locations and distributions centers such as, but not limited to, [***]. Incoterms for sale to iRobot are FCA Port (or airport) of Origin.  iRobot will select the freight forwarder and communicate local contacts to Kin Yat. Based on selection of forwarder or ocean carrier, iRobot will specify the Port of Origin.  iRobot will be responsible for paying the transportation costs from the origin port or airport to the destination, Kin Yat will arrange empty container delivery in accordance with the shipping schedule communicated to Kin Yat by iRobot. Upon receipt of container, Kin Yat will inspect the container for any signs of damages to flooring, any holes in the roof or side of the containers, and any sign of tampering with the latching device (tampering to include drilling out rivets and replacing the rivets with bolts). If the container has holes, damages or signs of tampering Kin Yat will request a replacement container. Products will be loaded on the container, floor stacked, in a manner to prevent damage and to fully utilize the container. Kin Yat shall adhere to any specific pallet configuration requested and provided by iRobot.  If there is a requirement to ship on wooden pallets, then the pallets must meet the guidelines of ISPM15 and be appropriately marked, indicating the pallets meet the standards.  iRobot will be responsible for the costs associated with purchasing these pallets. Containers must be sealed with a cargo seal that meets or exceeds ISO/PAS 17712:2006.

12.5    Direct shipment to iRobot Customers. From time to time, iRobot may direct Kin Yat to arrange for shipping directly to iRobot’s customers in accordance with specific Incoterms identified by iRobot at that time. The container inspection requirements and pallet requirements under Section 12.4 shall apply to any shipments directly to iRobot’s customers. 

12.6    Inventory losses and gains. As  Kin Yat is responsible for the care, custody and control of iRobot’s products, risk will be balanced with responsibility in the following way. Physical inventories and cycle counts will be conducted as indicated above. During the first month after the first anniversary date of the contract and each subsequent anniversary date, the losses and gains of inventory, based on iRobot’s perpetual inventory will be netted and a final loss or gain identified. 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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13Duty to Mitigate Costs.  Both Parties shall, in good faith, undertake Commercially Reasonable Efforts to mitigate the costs of termination, expiration or cancellation.  Kin Yat shall make Commercially Reasonable Efforts to cancel all applicable component and material purchase orders and reduce component inventory through return for credit programs or allocate such components and materials for alternate iRobot programs if applicable, or other customer orders provided the same can be used within [***] of the termination date.

14Term.  Unless earlier terminated as provided in Section 15 below, the term of this Agreement shall commence on the Effective Date and shall continue until the second anniversary of the Production Start Date (the “Initial Term”), and shall automatically renew for successive two-year terms (each, a “Renewal Term”) unless (a) following the first Renewal Term, Kin Yat provides written notice to iRobot of its intent not to renew this Agreement within twelve (12) months prior to the end of the then existing Renewal Term, or (b) iRobot provides written notice to Kin Yat of its intent not to renew this Agreement within [***] prior to the end of the then existing Term. 

15Termination.  This Agreement may be terminated as follows:

15.1    Termination for Cause.  Either Party may terminate this Agreement based on the material breach by the other Party of the terms of this Agreement, provided that the Party alleged to be in material breach receives written notice setting forth the nature of the breach at least [***] prior to the intended termination date. During such time the Party in material breach may cure the alleged breach and if such breach is cured within such [***] period, no termination will occur and this Agreement will continue in accordance with its terms.  If such breach shall not have been cured, termination shall occur upon the termination date set forth in such notice.

15.2    Termination for Bankruptcy/Insolvency. Upon the happening of any of the following events with respect to a Party, except as otherwise prohibited by the United States bankruptcy laws, this Agreement may be terminated immediately:

15.2.1    The appointment of a receiver or custodian to take possession of any or all of the assets of a Party, or should a Party make an assignment for the benefit of creditors, or should there be an attachment, execution, or other judicial seizure of all or a substantial portion of a Party’s assets, and such attachment, execution or seizure is not discharged within [***]. 

15.2.2    A Party becomes a debtor, either voluntarily or involuntarily, under Title 11 of the United States Code or any other similar law and, in the case of an involuntary proceeding, such proceeding is not dismissed within [***] of the date of filing. 

15.2.3    The dissolution or termination of the existence of a Party whether voluntarily, by operation of law or otherwise.

15.3    Termination Consequences.  

15.3.1    If this Agreement is terminated for any reason, iRobot shall not be excused from performing its obligations under this Agreement with respect to payment for all monies due to Kin Yat hereunder including fees, costs and expenses incurred by Kin Yat up to and including the effective date of such termination in accordance with Section 15.3.3. The following Sections 3.8, 3.10.4, 4.5, 4.11.3, 4.13, 5, 6, 7, 8, 10, 13, 15.3, 15.4, 15.5, 16, 17.1, 17.2, 17.3, 17.4, 18, 19, 23, 25 and Schedule 4 shall survive the expiration, cancellation or termination of this Agreement.

15.3.2    All Purchase Orders issued prior to the effective date of the termination or expiration will be fulfilled pursuant to and subject to the terms of this Agreement, even if the delivery dates of Products under such Purchase Orders are after such effective date of expiration or termination.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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15.3.3    Within [***] of the effective date of the expiration or termination of this Agreement for any reason other than Kin Yat’s material uncured breach, iRobot shall purchase at Kin Yat’s cost any raw materials (including packaging materials) that Kin Yat has purchased exclusively for the production of Products for iRobot, WIP  and finished Product that have not been shipped previously to iRobot.  At its option iRobot may, in lieu of purchasing such raw materials at cost, place Purchase Orders with Kin Yat for additional Product under the terms of this Agreement in order to extinguish existing stocks of such raw materials.  In the event that the Agreement terminates as a result of a material uncured breach by Kin Yat, iRobot shall be under no obligation to purchase any unused raw materials from Kin Yat.  In the event that the Agreement terminates for any other reason, iRobot shall purchase from Kin Yat all Product inventory (including WIP and finished Product).  Kin Yat shall accommodate last buy order from iRobot

15.3.4    Return of Product and Materials Supplied by iRobot.  Upon the effective date of expiration or termination of this Agreement for any reason whatsoever, Kin Yat shall immediately deliver to iRobot or its designee all Product, Specifications, Components, packaging materials and other materials purchased by or on behalf of iRobot and all other materials or supplies provided by iRobot.  Kin Yat shall also deliver to iRobot or its designee all Product produced hereunder, and shall invoice iRobot in accordance with the terms of Section 7.1.  

15.4    Manufacturing Rights upon Termination. If Kin Yat ceases to manufacture and/or supply any Product due to any termination of this Agreement by iRobot pursuant to Sections 15.1 or 24, or if Kin Yat elects not to renew the Term pursuant to Section 14, then Kin Yat hereby grants to iRobot a non-exclusive, royalty-free, worldwide, transferable, perpetual irrevocable license to all of its Intellectual Property Rights under the Technical Manufacturing Information – KIN YAT to make, have made, sell, offer for sale, import, use, reproduce, modify, adapt, display, distribute, and make Products and other versions of the Products. iRobot may sublicense these rights to third parties, provided any such third party complies with the terms of this license and any associated obligations of confidentiality. Upon iRobot’s exercise of its rights under this Section 15.4, Kin Yat shall promptly provide to iRobot all information, including manufacturing know-how and other materials required to enable iRobot to independently manufacture, test and repair the Products. 

15.5    Transition Assistance.  Upon expiration or earlier termination of this Agreement, Kin Yat will support iRobot in making an orderly transition to a successor third party manufacturer during a period lasting no longer than [***] (the “Transition Period”) at the expense of iRobot.  During such Transition Period, (a) Kin Yat shall provide, in a timely and professional manner, services reasonably necessary to transition the Manufacturing Services to a successor third party manufacturer; and (b) all of the terms and conditions of this Agreement shall continue to be in full force and effect, including Manufacturer’s obligations to continue providing the Manufacturing Services.  In addition, Kin Yat shall provide such technical assistance to iRobot or its designated third party manufacturer, as iRobot may reasonably request in connection with such transition.  At the end of such Transition Period, or upon iRobot’s earlier request, Kin Yat shall deliver to iRobot, or to iRobot’s agent all tooling, fixtures, Components, Products (including WIP), tangible embodiments of iRobot’s Proprietary Information and Technology and all documentation and materials related to the Products at the expense of iRobot.

		
	16
	Confidentiality.

16.1    Both parties acknowledge that, by reason of their relationship, they may have access to certain information and/or materials concerning the business, plans, products, services and clients (including, but not limited to, information and materials contained in technical data) and including information necessary for the Services (“Confidential Information”), which is confidential and of substantial value and which value would be impaired if such information were disclosed to third parties. The parties agree that the handling of confidential information shall be pursuant to the Non-Disclosure Agreement, which is incorporated herein by reference. 
16.2    Kin Yat agrees that it will have any personnel of Kin Yat providing Services execute a written Non-Disclosure Agreement (“NDA”) substantially similar in nature and scope to and no less protective of the Company than the Non-Disclosure Agreement.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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   16.3   Each Party represents and warrants to the other that it has adopted policies and procedures with respect to the receipt and disclosure of confidential or proprietary information, such as the Proprietary Information and Technology with its employees, agents and representatives.  Each Party represents and warrants to the other Party that it will cause each of its employees, agents and representatives to maintain and protect the confidentiality of the other Party’s Proprietary Information and Technology pursuant to the terms and conditions of the Non-Disclosure Agreement.

		
	17
	Intellectual Property Rights.

17.1    Intellectual Property – Existing by Kin Yat.

17.1.5    Except for the license rights granted to iRobot under this section 17.1.1, Kin Yat shall retain all right, title and ownership to any and all Intellectual Property – Existing by Kin Yat and all Intellectual Property Rights therein.  

17.1.6    Kin Yat shall not incorporate any Intellectual Property – Existing by Kin Yat into any Products without iRobot’s prior written approval.  To the extent any Intellectual Property – Existing by Kin Yat is incorporated by or on behalf of Kin Yat within or used by or on behalf of Kin Yat in connection with any Product, Kin Yat hereby grants to iRobot a non-exclusive, royalty-free, fully paid up, worldwide, perpetual, license under all of its Intellectual Property Rights in or to the  Intellectual Property – Existing by Kin Yat to make, have made, sell, offer for sale, import, use, reproduce, modify, adapt, display, distribute, and make other versions of, the Product and the right to sublicense third parties (including but not limited to manufactures, system integrators, value added resellers, distributors and other resellers) for iRobot to use, sell, test, improve, support and distribute the Products and to otherwise manufacture and support discontinued Products; provided however, that no license to the Technical Manufacturing Information – KIN YAT shall be granted under this Section 17.1.2. 

17.2    Kin Yat Created Intellectual Property – Created by Kin Yat.

17.2.1    Except for the license rights granted to iRobot under 17.1.1, Kin Yat shall retain all right, title and ownership to any and all Intellectual Property – Created by Kin Yat and all Intellectual Property Rights therein.

17.2.2    Kin Yat hereby grants to iRobot a non-exclusive, royalty-free, fully paid up, worldwide, perpetual, irrevocable license under all of its Intellectual Property Rights in or to the Technical Manufacturing Information – KIN YAT developed under this Agreement that is unique to the Products for iRobot’s internal use and the use by third party suppliers or manufacturers on behalf of iRobot to develop, design, improve, test and support the Products. 
17.2.3    Any such unique Technical Manufacturing Information – KIN YAT will be used by Kin Yat solely for the design, development, testing and manufacturing of Products for iRobot.

17.3    iRobot Intellectual Property.  iRobot shall retain all right, title and ownership to any and all iRobot Intellectual Property and all Intellectual Property Rights therein.

17.4    Newly Created Intellectual Property.  

17.4.1    The Newly Created Intellectual Property constitutes “works made for hire” for iRobot, and iRobot will be considered the author and will be the owner of the Newly Created Intellectual Property and all Intellectual Property Rights therein or related thereto.  If any Newly Created Intellectual Property does not qualify for treatment as “works made for hire”, or if Kin Yat retains any interest in any Newly Created Intellectual Property for any other reason, Kin Yat hereby grants, assigns and transfers, and will grant, assign and transfer, to iRobot all ownership and interest in such Newly Developed Intellectual Property, including without limitation any and all Intellectual Property Rights in and to any Newly Created Intellectual Property or that claim or cover any Newly Created Intellectual Property.  Kin Yat acknowledges that all personnel performing Manufacturing Services for iRobot under this Agreement have 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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executed appropriate agreements with Kin Yat so that Kin Yat may fulfill Kin Yat’s obligations under this Section 17.  Kin Yat agrees to execute any documents of assignment or registration requested by iRobot relating to any and all Newly Created Intellectual Property.  Kin Yat agrees to cooperate fully with iRobot, both during and after the engagement, with respect to the procurement, maintenance and enforcement of Intellectual Property Rights in or related to Newly Created Intellectual Property.

17.4.2    During the Term plus any period of support that may survive termination or expiration of this Agreement, Kin Yat agrees to inform iRobot of any Newly Created Intellectual Property.

17.5    Trademark Usage. Nothing in this Agreement gives either Party a right to use the other Party’s Marks or implies the grant of any license from one Party to the other to use any Marks.  Notwithstanding the foregoing, and subject to the terms and conditions of this Agreement, iRobot grants to Kin Yat a limited, non-exclusive, non-transferable, non-assignable, royalty-free license during the Term to reproduce any Mark set forth on Schedule 4, or otherwise designated in writing by iRobot (“iRobot Marks”) solely for the purpose placing such Marks on Products sold to iRobot and any applicable packaging, and for no other business or non-business purposes whatsoever and no other goods or services whatsoever, in accordance with the following:

17.5.1    All reproductions of iRobot Marks must be approved in writing by iRobot and must be in accordance with iRobot’s then current Trademark Usage Guidelines (“Mark Guidelines”), a copy of which is included in Schedule 4;

17.5.2    Kin Yat may not combine any iRobot Marks with, or create a composite mark using any iRobot Mark with, a trademark of Kin Yat or any third party, or use any of the iRobot Marks or any part thereof as part of its corporate name, or use any name or mark confusingly similar to any of the iRobot Marks;

17.5.3    No other rights or licenses, except that expressed in this Section 17.5 are granted to Kin Yat in and to any iRobot Mark, whether expressly, by implication, by estoppel, or otherwise;

17.5.4    As between iRobot and Kin Yat, the iRobot Marks are and shall remain the sole and exclusive property of iRobot and Kin Yat shall not acquire any right, title or interest in or to any iRobot Mark as a result of this Agreement (other than the limited license expressly granted in this Section 17.5) and all use of the iRobot Marks by Kin Yat and all goodwill generated thereby shall inure solely to the benefit of iRobot;

17.5.5    Kin Yat admits the validity of, and agrees not to challenge the iRobot Marks;

17.5.6    If any application for registration is or has been filed in any country by Kin Yat which relates to any name or mark which, in the sole opinion of iRobot, is confusingly similar, deceptive or misleading with respect to any of the iRobot Marks, Kin Yat shall immediately abandon any such application or registration or at iRobot’s sole discretion, assign it to iRobot, and reimburse iRobot for all costs and expenses of any opposition, cancellation or related legal proceedings, including attorney’s fees, instigated by iRobot or its authorized representative, in connection with any such registration or application; and

17.5.7    Upon any notice from iRobot that Kin Yat’s use of the iRobot’s Marks fails to conform with the Mark Guidelines, or any other provision of this Section 17.5, Kin Yat shall cease use of the iRobot Marks, until such failure has been corrected to the satisfaction of iRobot.

17.6    Kin Yat Marks. Kin Yat agrees and warrants that it will not use any Kin Yat or third party Mark (excluding authorized Marks of the iRobot) on any Product, packaging materials or documentation without iRobot’s prior written authorization.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

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17.7    Grant of License to iRobot Intellectual Property.  In addition to Clause 17.5, iRobot hereby grants to Kin Yat a limited, non-exclusive, non-transferable, non-assignable, non-sublicensable and royalty-free right and license to use iRobot Intellectual Property, Proprietary Information and Technology and specifications solely for the purpose of performing its obligations under this Agreement, including manufacturing Products pursuant to this Agreement and supplying such Products only to iRobot.  Such limited right and license shall extend to no other materials or for any other purpose and shall terminate automatically upon expiration or termination of the relevant Purchase Order or this Agreement for any reason.

18Manufacturing Services for Competitive Products.  In order to protect the iRobot’s Proprietary Information and Technology, during the Term of this Agreement and for a period of [***] following the termination of this Agreement for any reason, Kin Yat will not, without the iRobot’s express written consent, engage in any design, development, manufacturing, testing, configuring, assembling, packaging, shipping and/or selling of any product that is or is intended to be, directly or indirectly competitive with any of the Products, including, without limitation, any robotic floor care product. 

19Indemnification.

19.1    Kin Yat’s Indemnity Obligations. Kin Yat shall indemnify, defend and hold iRobot and its employees, Subsidiaries, Affiliates, successors and assigns (“iRobot Indemnified Parties”) harmless from and against any and all losses, liabilities, damages (including consequential, special and/or punitive damages), claims, expenses, suits, recoveries, judgments and fines (including reasonable attorneys’ fees and expenses) (collectively “Losses”) that may be incurred by any iRobot Indemnified Party arising out of (a) any damage to property or injury or death occurring to any person arising out of any failure by Kin Yat to provide Product in conformance with the Specifications; (b) any injury to person or property or death occurring to any Kin Yat employees, subcontractors, agents or any other individuals on Kin Yat’s premises, except to the extent such injury to person or property or death was caused by the presence of iRobot’s employees or agents on Kin Yat’s premises; (c) any claim, action or proceeding brought by any governmental authority arising out of or resulting from the Manufacturing Services for Product that does not conform to the Specifications; (d) any breach by Kin Yat of any of its respective obligations, representations or warranties under this Agreement, including a breach which results in a recall of Product as contemplated under Section 4; (e) any other grossly negligent or willful act or omission on the part of Kin Yat; (f) the operation, ownership or control of the facilities of Kin Yat, its Affiliates or its subcontractors or the manufacturing, generation, processing, storage, transportation, distribution, treatment, disposal or other handling of the Products or materials used in the manufacture and packaging of the Products, or associated by-product, raw materials, intermediates, wastes, hazardous materials, emissions, releases, spills, leaks or discharges, or returned Products, Kin Yat, Affiliates of Kin Yat, or subcontractors of Kin Yat or its Affiliates, or their officers, directors, employees, agents or contractors; (g) any claim relating to the infringement of patent or other intellectual property rights relating to the manufacturing process employed by Kin Yat in performing the Manufacturing Services for Products or that Kin Yat asserts as owning in connection with the manufacturing of the Product or (h) violation of any applicable law, regulation, or rule in connection with the Manufacturing Services for Products hereunder, provided that the indemnity under this Section 19.1 shall not apply if any Loss is caused by (1) Kin Yat’s use of materials, trademarks and symbols supplied by iRobot, Kin Yat’s reliance upon the Specifications, iRobot Intellectual Property, iRobot’s Proprietary Information and Technology and/or the Packaging and Shipping Specifications in accordance with the terms of this Agreement, or (2) defects in design or product liability caused by iRobot or its agents, or (3) the gross negligence or willful misconduct of iRobot.

19.2    iRobot’s Indemnity Obligations. Except to the extent subject to Kin Yat’s indemnification of iRobot as provided in Section 19.1, iRobot shall indemnify, defend and hold Kin Yat and its employees, Subsidiaries, Affiliates, successors and assigns (“Kin Yat Indemnified Parties”) harmless from and against any and all Losses, arising from any third party claims asserted against any Kin Yat Indemnified Party, to the extent based on any of the following: (a) making, using or selling the Product, proper and authorized use of the Specifications, iRobot Intellectual Property, Packaging and Shipping Specifications, Proprietary Information and Technology of iRobot, any Product, or any 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

25

    

information, technology and processes supplied and/or approved by iRobot or otherwise required by iRobot of Kin Yat, in connection with Kin Yat’s performance of its obligations under this Agreement; (b) any recall or actual noncompliance with Materials Declaration Requirements; (c) that Kin Yat’s use of any item in subsection (a) in connection with performing its obligations under this Agreement infringes any patent, copyright or other intellectual property right of a third party,  (d) performance of the Manufacturing Services in accordance with the Product Specifications, and (e) any other grossly negligent or willful act or omission on the part of iRobot.

19.3    Indemnification Procedures.  Any Person that may be entitled to indemnification under this Agreement shall give the other Party prompt notice of any claim and cooperate with the indemnifying Party at its expense.  The Indemnifying party shall have the right to assume the defense (at its own expense) of any such claim through counsel of its own choosing by so notifying the Party seeking indemnification within [***] of the first receipt of such notice.  The Party seeking indemnification shall have the right to participate in the defense thereof and to employ counsel, at its own expense, separate from the counsel employed by the Indemnifying party.  The Indemnifying party shall not, without the prior written consent of the indemnified party, agree to the settlement, compromise or discharge claim.

20Relationship of Parties. Kin Yat shall perform its obligations hereunder as an independent contractor.  Nothing contained herein shall be construed to imply a partnership or joint venture relationship between the Parties. The Parties shall not be entitled to create any obligations on behalf of the other Party, except as expressly contemplated by this Agreement.  The Parties will not enter into any contracts with third parties in the name of the other Party without the prior written consent of the other Party.

21Insurance. During the Term and at all times that Kin Yat performs work for iRobot, Kin Yat will maintain in full force and effect, at Kin Yat’s own expense, for the benefit of both Kin Yat and iRobot, insurance coverage to include:

21.1 Kin Yat shall maintain for the term of this Agreement, at its own expense: a comprehensive or commercial general liability policy including contractual liability products/completed operation and broad form property damage coverage, affording protection on an occurrence basis for claims arising out of bodily injury, death, and property damage, and having limits of not less than; a combined single limit of $[***] per occurrence with a $[***] aggregate limit of liability and (ii) Worker’s Compensation insurance as required by the laws of the state, province, country or similar authority(ies) where the services will be performed (iii) Commercial Automobile Liability Insurance - bodily injury and property damage combined single limit of RMB[***]. Such comprehensive or commercial general liability policy insurance shall name iRobot as an additional insured and may not be canceled or changed without at least [***] prior written notice to iRobot.  Prior to the commencement of Services, Kin Yat shall provide a certificate of insurance to iRobot evidencing these requirements and shall provide updated certificates as applicable.  Kin Yat shall also be liable to maintain, at its sole expense, travel insurance coverage and any legally mandated health insurance.

21.2   Additional Requirements. All deductibles on policies providing coverage will be paid by Kin Yat. In the event Kin Yat is self-insured for matters described above, Kin Yat agrees to respond to any claims or losses made against or incurred by iRobot in the same fashion as if insurance had been purchased.  In no event will the coverage or limits of any insurance required under this Section 21, or the lack or unavailability of any other insurance, be deemed to limit or diminish either Party’s obligations or liability to the other Party under this Agreement, including but not limited to, each Party’s indemnification obligations as set forth in Section 19. Kin Yat will obtain the necessary insurance within [***] of the Effective Date. 

		
	22
	Business Continuity Plan.

22.1    Risk Management and Continuity Plans. Kin Yat will develop and keep current a formal business continuity plan detailing Kin Yat’s plans, procedures and designated resources for timely response to and recovery from potential civil, natural, and physical plant disasters that could reasonably be expected to disrupt production and delivery to iRobot (“Business Continuity Plan”). Upon request, Kin Yat will make such plan available to iRobot or its designated representative for review. 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

26

    

22.2    Notification. Kin Yat agrees to notify iRobot as soon as possible in the event of a crisis that disrupts manufacturing or delivery of Products. Unless authorized in advance in writing by iRobot, Kin Yat will not refer to iRobot in public and media communications about the crisis and subsequent recovery.

22.3    Loss Control. Kin Yat will be responsible for maintaining its facilities and operations in accordance with applicable fire protection and loss control laws, regulations and industry standards.

23Publicity. Without the written consent of the other Party, neither Party shall refer to this Agreement in any publicity or advertising or disclose to any third party any of the terms of this Agreement.  Notwithstanding the foregoing, neither Party will be prevented from, at any time, furnishing any information to any governmental or regulatory authority, including the United States Securities and Exchange Commission or any other foreign stock exchange regulatory authority, that it is by law, regulation, rule or other legal process obligated to disclose, so long as the other Party is given advance written notice of such disclosure pursuant to Section 2.4 of the Non-Disclosure Agreement.  In addition, a Party may disclose the existence of this Agreement and its terms to its attorneys and accountants, suppliers, customers and others only to the extent necessary to perform its obligations and enforce its rights hereunder, and to existing and prospective investors and/or acquirers that are contemplating a potential investment in or acquisition of such Party, provided, however, that any and all such suppliers, customers, investors, acquirers and advisers are bound by agreements or, in the case of professional advisers, ethical duties, to treat, hold and maintain such information in accordance with the terms and conditions of the Non-Disclosure Agreement.

24Force Majeure. 

24.1    Subject to Section 24.2.2 below, neither Party shall be liable for any failure or delay in the performance of its obligations under this Agreement to the extent such failure or delay is due to causes beyond such party’s reasonable control, including but not limited to, acts of God, acts of civil or military authority, legal restrictions, fires, explosion, embargo, mobilization, riot, epidemics, and to the extent the following are on a national basis, strikes, industrial disturbances, shortage of material, electricity, oil or transport, or restriction in the use of power.  Events set forth  above are referred to individually and collectively as “Force Majeure Events.” The Parties expressly acknowledge that Force Majeure Events do not include vandalism, or the non-performance of third parties or subcontractors relied on for the delivery of the Manufacturing Services, unless such failure or non-performance by a third party or subcontractor is itself caused by a Force Majeure Event, as defined above. Upon the occurrence of a Force Majeure Event, the non-performing Party shall be excused from any further performance or observance of the affected obligation(s) for as long as such circumstances prevail, and such Party continues to attempt to recommence performance or observance to the greatest extent possible without delay.

24.2    Notwithstanding any other provision of this Section 24, a Force Majeure Event shall obligate and require Kin Yat to commence and successfully implement all of the Manufacturing Services relating to disaster recovery set forth in its Business Continuity Plan within the time period described therein.  If a Force Majeure Event causes a material failure or delay in the performance of any Manufacturing Services for more than [***] consecutive days, iRobot may, at its option, and in addition to any other rights iRobot may have, procure such Manufacturing Services from an alternate source until Kin Yat is again able to provide such Manufacturing Services.  iRobot shall continue to pay Kin Yat the charges due and payable hereunder during such period, but Kin Yat shall not be entitled to any additional payments as a result of the Force Majeure Event.  If a Force Majeure Event causes a material failure or delay in the performance of any Manufacturing Services under this Agreement for more than [***] consecutive days, iRobot may, at its option, and in addition to any other rights iRobot may have, immediately terminate this Agreement without liability to Kin Yat.

25Miscellaneous.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

27

    

25.1    Notices.  All notices, demands and other communications made hereunder shall be in writing and shall be given either by personal delivery, by nationally recognized overnight courier (with charges prepaid), by facsimile or EDI (with telephone confirmation) addressed to the respective Parties at the following addresses:

    
	
		
	Notice to Kin Yat:
	Kin Yat Industrial Company Limited
7th Floor Galaxy Factory Building
25-27 Luk Hop Street
San Po Kong, Kowloon
Hong Kong
Facsimile: (852) 2351 1867
Attn: Mr. Vincent Fung

	 
	 

	with a copy to:
	Kin Yat Holdings Limited
25-27 Luk Hop Street
San Po Kong, Kowloon
Hong Kong
Facsimile: (852) 2351 1867
Attn: General Counsel

	 
	 

	Notice to iRobot:
	iRobot Corporation
8 Crosby Drive
Bedford, MA 01730
Facsimile: (781) 430-3001
Attn: General Counsel

25.2    Expenses and Costs. Each Party shall pay their own expenses in connection with the negotiation of this Agreement.  All fees and expenses incurred in connection with the resolution of Disputes shall be allocated as further provided in Section 25.15 below. 

25.3    Amendment. No course of dealing between the Parties hereto shall be effective to amend, modify, or change any provision of this Agreement.  This Agreement may not be amended, modified, or changed in any respect except by an agreement in writing signed by the Party against whom such change is to be enforced.  The Parties may, subject to the provisions of this Section 25.3, from time to time, enter into supplemental written agreements for the purpose of adding any provisions to this Agreement or changing in any manner the rights and obligations of the Parties under this Agreement or any Schedule hereto.  Any such supplemental written agreement executed by the Parties shall be binding upon the Parties. 

25.4    Partial Invalidity.  Whenever possible, each provision of this Agreement shall be interpreted in such a way as to be effective and valid under applicable law.  If a provision is prohibited by or invalid under applicable law, it shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

25.5    Monies.  All references to monies in this Agreement shall be deemed to mean lawful monies of the United States of America.

25.6    Entire Agreement.  This Agreement, the Schedules and any addenda attached hereto or referenced herein, constitute the complete and exclusive statement of the agreement of the Parties with respect to the subject matter of this Agreement, and replace and supersede all prior agreements and negotiations by and between the Parties. Each Party acknowledges and agrees that no agreements, representations, warranties or collateral promises or inducements have been made by any Party to this Agreement except as expressly set forth herein or in the Schedules and any addenda 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

28

    

attached hereto or referenced herein, and that it has not relied upon any other agreement or document, or any verbal statement or act in executing this Agreement.  These acknowledgments and agreements are contractual and not mere recitals.  In the event of any inconsistency between the provisions of this Agreement and any Schedule and any addenda attached hereto or referenced herein, the provisions of this Agreement shall prevail unless expressly stipulated otherwise, in writing executed by the Parties.  Pre-printed language on each Party’s forms, including purchase orders, that conflict with the terms and conditions of this Agreement, are shall not constitute part of this Agreement and shall be deemed unenforceable.

25.7    Binding Effect. This Agreement shall be binding on the Parties and their successors and assigns; provided, however, that Kin Yat shall not assign, delegate or transfer, in whole or in part, this Agreement or any of its rights or obligations arising hereunder, without the prior written consent of iRobot.  Any purported assignment without such consent shall be null and void.

25.8    Anti-Corruption Laws.  Kin Yat represents that it has a copy of, and is familiar with, the United States Foreign Corrupt Practices Act, 15 U.S.C. §78dd-2 (the “FCPA”), and the purposes of the FCPA, including the FCPA’s prohibition of the payment or the gift of any item of value, either directly or indirectly, by or on behalf of a company organized under the laws of the United States of America or any of its states to an official, employee, or officer of, or person acting in an official capacity for, a government or international organization for the purpose of influencing any action or decision, or inducing him to use his influence with the government or organization in a manner contrary to his position or creating an improper advantage to assist a company in obtaining or retaining business for, with, or in that country or organization or directing business to any person.  Kin Yat represents and warrants that it will take no action that would constitute a violation of the FCPA or any law.  Moreover, Kin Yat represents and warrants that no government official is a principal, owner, officer, employee or agent of any entity in which Kin Yat has an interest, and no government official has any material financial interest in the business of Kin Yat.  Further, Kin Yat represents and warrants that Kin Yat and its Affiliates do and shall comply with all applicable legal requirements and iRobot’s policies against corrupt business practices, against money laundering and against facilitating or supporting persons who conspire to commit crimes or acts of terror against any person or government.  Kin Yat agrees that it will notify iRobot in writing immediately of the occurrence of any event, which renders the foregoing representations and warranties of this paragraph incorrect. 

25.9    Child/Forced Prison Labor Laws.  Kin Yat, by signing this agreement, represents and warrants that it and its subcontractors/suppliers will comply with all applicable local government regulations regarding minimum wage, living conditions, overtime, working conditions, child labor laws and the applicable labor and environmental laws. Kin Yat further represents and warrants that it and its subcontractors/suppliers do not use any form of forced prison labor and/or child labor under the age of 15 or the minimum age required by local government, whichever is older.

25.10    Waiver. Waiver by either Party of any breach of any provision of this Agreement shall not be considered as or constitute a continuing waiver or a waiver of any other breach of the same or any other provision of this Agreement. 

25.11    Captions. The captions contained in this Agreement are inserted only as a matter of convenience or reference and in no way define, limit, extend or describe the scope of this Agreement or the intent of any of its provisions.

25.12    Construction. Since both Parties have engaged in the drafting of this Agreement, no presumption of construction against any Party shall apply.

25.13    Section References. All references to Sections or Schedules shall be deemed to be references to Sections of this Agreement and Schedules attached to this Agreement, except to the extent that any such reference specifically refers to another document.  All references to Sections shall be deemed to also refer to all subsections of such Sections, if any.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

29

    

25.14    Business Day. If any time period set forth in this Agreement expires upon a Saturday, Sunday or U.S. national, legal or bank holiday, such period shall be extended to and through the next succeeding business day. 

25.15    Dispute Resolution.

              25.15.1     Kin Yat and iRobot mutually agree to the settlement by arbitration of all claims or controversies each party may have against the other relating in any manner whatsoever to this Agreement or its terms. Except for the right to obtain provisional remedies or interim relief, which right is preserved without any waiver of the right to arbitration, arbitration under this Agreement shall be the exclusive remedy for all such arbitrable claims. Kin Yat and iRobot also agree that arbitration shall be held in Boston, Massachusetts if such arbitration is sought by Kin Yat and in Hong Kong if such arbitration is sought by iRobot, and shall be in accordance with the Commercial Arbitration Rules of the American Arbitration Association (“AAA”), and judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. The arbitrator(s) shall have the authority to award or grant both  legal, equitable and declaratory relief. Such arbitration shall be final and binding on the parties.
 
           25.15.2   Kin Yat and iRobot agree that in the event that any action, either civil or arbitral is brought to enforce this Agreement by either Kin Yat or iRobot, the prevailing party shall be entitled to an award of all reasonable attorneys’ fees and legal costs, in addition to other relief. 

             25.15.3 The Parties agree that the existence, conduct and content of any negotiation or arbitration pursuant to this Section 25.15 shall be kept confidential and no Party shall disclose to any Person any information about such negotiation or arbitration, except as set forth in Section 16 or 23.

           25.15.4   IN THE EVENT OF ANY DISPUTE BETWEEN THE PARTIES, WHETHER IT RESULTS IN PROCEEDINGS IN ANY COURT IN ANY JURISDICTION OR IN ARBITRATION, THE PARTIES HEREBY KNOWINGLY AND VOLUNTARILY, AND HAVING HAD AN OPPORTUNITY TO CONSULT WITH COUNSEL, WAIVE ALL RIGHTS TO TRIAL BY JURY, AND AGREE THAT ANY AND ALL MATTERS SHALL BE DECIDED BY A JUDGE OR ARBITRATOR WITHOUT A JURY TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW.

             25.15.5   Notwithstanding anything contained in this Section 25.15 to the contrary, in the event that either Party is seeking temporary or preliminary injunctive relief, including any action for equitable relief, such Party may proceed in the Massachusetts Courts without prior negotiation or arbitration for the limited purpose of avoiding immediate and irreparable harm.

25.16     Insider Trading. Kin Yat will not, and will cause its Affiliates and Subsidiaries to not, transact in any securities of iRobot based on the manufacture of any Product under this Agreement or any Proprietary Information and Technology of the iRobot or from communicating any such information to any other Person in connection with the trading of such securities.  
25.17      Other Documents. The Parties shall take all such actions and execute all such documents that may be necessary to carry out the purposes of this Agreement, whether or not specifically provided for in this Agreement.
25.18      Counterparts. This Agreement may be executed by facsimile and delivered in one or more counterparts, each of which shall be deemed to be an original and all of which, taken together, shall be deemed to be one agreement.
25.19      Even-Handed Construction.  The terms and conditions as set forth in this Agreement have been arrived at by sophisticated parties with equal bargaining power, each having an opportunity to consult with counsel, after mutual negotiation, and it is the intention of the Parties that its terms and conditions not be construed against any Party merely because it was prepared by one of the Parties.

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

30

    

25.20      Governing Law and Jurisdiction. All disputes, claims or controversies arising out of this Agreement, or the interpretation, negotiation, validity or performance of this Agreement, or the transactions contemplated hereby shall be governed by the laws of the State of New York, without application of conflicts of law principles. The provisions of the United Nations Convention on Contracts for the International Sale of Goods shall not apply to this Agreement.  

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

31

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives.

	
					
	IROBOT CORPORATION
	 
	KIN YAT INDUSTRIAL COMPANY LIMITED

	 
	 
	 
	 
	 

	By:
	/s/ Alison Dean
	 
	By:
	/s/ Vincent Fung

	 
	Signature
	 
	 
	Signature

	 
	 
	 
	 
	 

	Name:
	Alison Dean
	 
	Name:
	Vincent Fung

	 
	(Print)
	 
	 
	(Print)

	 
	 
	 
	 
	 

	Title:
	CFO
	 
	Title:
	Director

	 
	 
	 
	 
	 

	Date:
	1/22/14 *
	 
	Date:
	Feb.10.2014

	 
	* agreed to be effective as of 9/23/13
	 
	 
	 

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

    

SCHEDULE 1
TO MANUFACTURING SERVICES AGREEMENT
BETWEEN Kin Yat AND iRobot

STATEMENT OF WORK

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

    

SCHEDULE 2
TO MANUFACTURING SERVICES AGREEMENT
BETWEEN Kin Yat AND iRobot

FEE AND PRICE (FINAL QUOTE)

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

SCHEDULE 3
TO MANUFACTURING SERVICES AGREEMENT
BETWEEN Kin Yat AND iRobot

QUALITY AND TEST PROCEDURES

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

SCHEDULE 4
TO MANUFACTURING SERVICES AGREEMENT
BETWEEN Kin Yat AND iRobot

NON-DISCLOSURE AGREEMENT

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

SCHEDULE 5
TO MANUFACTURING SERVICES AGREEMENT
BETWEEN Kin Yat AND iRobot

TRADEMARK USAGE GUIDELINES

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

SCHEDULE 6
TO MANUFACTURING SERVICES AGREEMENT
BETWEEN Kin Yat AND IROBOT

IROBOT QUARTER END

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions. 

Amendment # 1 to Manufacturing Services Agreement Between:  iRobot Corporation and Kin Yat Industrial Co. Ltd
PARTIES

		
	(1)
	iRobot Corporation, a Delaware corporation with its principal place of business at 8 Crosby Drive, Bedford, Massachusetts, 01730, USA ("Buyer").

		
	(2)
	Kin Yat Industrial Co. Ltd., a Hong Kong Company having its place of business at 7/F Galaxy Factory Building, 25-27 Luk Hop Steet, San Po Kong, Kowloon, Hong Kong (hereinafter referred to as ("Seller")

WHEREAS, the Parties executed the Manufacturing Services Agreement dated 23rd September, 2013 (the "Agreement").

WHEREAS, pursuant to clause 25.3 of the Agreement, the Parties wish to amend the Agreement;
For good and valuable consideration, Effective as of (6 August 2014), the following amendments are hereby agreed:
Clause 7.3 will be replaced in its entirety with the following:

Disputed Invoices. If a Kin Yat invoice does not meet the invoicing requirements of this Agreement, or iRobot in good faith disputes any invoiced charges, iRobot will notify Kin Yat of the disputed items in writing on or before the payment due date and may withhold payment of the disputed charges pending resolution of the dispute. With the exclusion of events beyond Kin Yat's control, such as quality related issues, late delivery or short shipment, any lack of timely payment by Kin Yat to any Supplier listed in Schedule 7, attached, will result in a deduction of the identical amount to any outstanding receivable of Kin Yat under this agreement.

If any conflict or inconsistency occurs between this Amendment and the Agreement, the provisions of this Amendment shall prevail. The remainder of the Agreement shall remain in full force and effect, unamended.

    
    	
				
	Signed by a duly authorised director or officer for and on behalf of iRobot Corporation
	 
	 

	Print full name:
	Oscar Zamorano
	 
	Signature:

	Position:
	SVP Operations & Supply Chain
	/s/ Oscar Zamorano

    	
				
	Signed by a duly authorised director or officer for and on behalf of Kin Yat Industrial Co. Ltd
	 
	 

	Print full name:
	Vincent Fung
	 
	Signature:

	Position:
	Executive Director
	/s/ Vincent Fung

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

SCHEDULE 7
TO MANUFACTURING SERVICES AGREEMENT
BETWEEN KIN YAT AND IROBOT

SUPPLIERS

JABIL CIRCUIT, INC.

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

Amendment #2 to Master Supplier Agreement Between:
 iRobot Corporation and Kin Yat Industrial Company, Ltd.

Parties

iRobot Corporation, a Delaware corporation with its principal place of business at 8 Crosby Drive, Bedford Massachusetts, 01730, USA ("iRobot")

Kin Yat Industrial Company, Ltd., a Hong Kong corporation, having its principal place of business at 7/F., Galaxy Factory Building, 25-27 Luk Hop Street, San Po Kong, Kowloon, Hong Kong. 

WHEREAS, the Parties executed the Master Supplier Agreement dated September 23, 2013 (“the Agreement”). 

WHEREAS, pursuant to Section 25.3 of the Agreement, the Parties wish to amend the Agreement as follows:

For good and valuable consideration, Effective as of June 1, 2015, the following amendments are hereby agreed:

Section 3.6.1 in the Agreement will be replaced in its entirety with the following:

3.6.1 Kin Yat will use Commercially Reasonable Efforts to procure Assigned Components from the applicable designated supplier per iRobot’s AVL and Generic Components per iRobot’s BOM, where applicable, and otherwise from suppliers chosen by Kin Yat and approved by iRobot, in amounts necessary to fulfill Purchase Orders and to procure under Material Authorizations. Kin Yat will be responsible for adherence to the Product Specifications in the assembly and manufacturing process. iRobot will be responsible for managing the pipeline of iRobot controlled Consigned Components. Kin Yat will be responsible for managing the pipeline of all Assigned Components, Generic Components, and any Consigned Components controlled by Kin Yat to the extent empowered by Company through its Material Authorizations and Purchase Orders. Company authorizes Kin Yat to procure Generic Components and Assigned Components necessary, without a Purchase Order from agreed upon distributors/suppliers, by issuing a written authorization to purchase such Components (“Material Authorization”), to meet specific Forecast or Purchase Order demand as well as any coverage which may be needed for NCNR and Long-Lead Components.  In the event of schedule changes, Kin Yat will use Commercially Reasonable Efforts to cancel all applicable material and parts inventory through return for credit programs or allocate such materials and parts for other customer orders. iRobot retains all liability for materials and parts Kin Yat cannot return or reuse elsewhere after Commercially Reasonable Efforts to mitigate such liability, if those materials were ordered by Kin Yat acting on iRobot’s Material Authorization or Purchase Order. Kin Yat’s obligation to exercise Commercially Reasonable Efforts to return/reuse any materials shall extend to all Components regardless of classification, except for non-cancel/nonreturnable (NCNR) Components.  

If any conflict or inconsistency occurs between the Amendment and the Master Supplier Agreement, the provisions of this Amendment shall prevail. The remainder of the Master Supplier Agreement shall remain in full force and effect, unamended. 

    	
				
	Signed by a duly authorised director or officer for and on behalf of iRobot Corporation
	 
	 

	Print full name:
	Oscar Zamorano
	 
	Signature:

	Position:
	SVP Operations & Supply Chain
	/s/ Oscar Zamorano

	Date:
	 
	 
	 

    	
				
	Signed by a duly authorised director or officer for and on behalf of Kin Yat Industrial Co. Ltd
	 
	 

	Print full name:
	Vincent Fung
	 
	Signature:

	Position:
	Director
	/s/ Vincent Fung

	Date:
	July 6, 2015
	 
	 

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

Amendment #3 to Manufacturing Services Agreement Between: 
iRobot Corporation and Kin Yat Industrial Company Ltd.

Parties

		
	(1)
	iRobot Corporation, a Delaware corporation with its principal place of business at 8 Crosby Drive, Bedford Massachusetts, 01730, USA ("iRobot")

		
	(2)
	Kin Yat Industrial Company Ltd., a Hong Kong corporation, having its principal place of business at 7/F., Galaxy Factory Building, 25-27 Luk Hop Street, San Po Kong, Kowloon, Hong Kong

WHEREAS, the Parties executed the Manufacturing Services Agreement dated September 23, 2013 (the "Agreement").

WHEREAS, pursuant to section 25.3 of the Agreement, the Parties wish to amend the Agreement and update the Parties to the Agreement as follows:

Parties: The name of iRobot Corporation shall remain iRobot Corporation ("iRobot"). iRobot is a Delaware corporation having its principal office in 8 Crosby Drive Bedford MA. The name of Kin Yat Industrial Company Ltd. is hereby changed to Kin Yat (HK) Holdings Limited ("Kin Yat"), including but not limited to its subsidiaries Kin Yat Industrial Company Limited and Kin Yat (Guizhou) Robot Company Limited. Kin Yat's principal office is located at 7/F., Galaxy Factory Building, 25-27 Luk Hop Street, San Po Kong, Kowloon, Hong Kong.

All references to "iRobot" in Sections 3, 4.10, 4.12, 5, 7, 11, and 12 will also include Guangzhou iRobot Robot Technology Consulting Company Limited ("Guangzhou iRobot"). For avoidance of doubt, Guangzhou iRobot shall have the right and ability to purchase Product from Kin Yat, Kin Yat (Guizhou) Robot Company Limited, and from any Subsidiary of Kin Yat, issue Purchase Orders for Product under this Agreement, and enforce all related rights as if it were iRobot.  Kin Yat agrees to indemnify, defend and hold harmless iRobot and its subsidiaries in accordance with the provisions under Section 19 of the Agreement. iRobot as the holding company of Guangzhou iRobot hereby unconditionally and irrevocably guarantees the due and punctual performance and observance by Guangzhou iRobot of all of its obligations, and shall assume all liabilities of Guangzhou iRobot in accordance with the provisions of the Agreement set forth above. Kin Yat hereby unconditionally and irrevocably guarantees the due and punctual performance and observance by its subsidiaries of all their obligations, and shall assume all liabilities of its subsidiaries, in accordance with the provisions of the Agreement with respect to its provision of manufacturing services and Additional Services under the Agreement.

If any conflict or inconsistency occurs between the Amendment and the Manufacturing Services Agreement, the provisions of this Amendment shall prevail. The remainder of the Manufacturing Services Agreement shall remain in full force and effect, unamended.

All parties below acknowledge and confirm the terms and conditions of the Agreement and this Amendment and agree to be bound by the terms and conditions of this Amendment.

    	
				
	Signed by a duly authorised director or officer for and on behalf of iRobot Corporation
	 
	 

	Print full name:
	Oscar Zamorano
	 
	Signature:

	Position:
	SVP Operations & Supply Chain
	/s/ Oscar Zamorano

	Date:
	Oct. 24, 2016
	 
	 

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

    	
				
	Signed by a duly authorised director or officer for and on behalf of Guangzhou iRobot Robot Technology Consulting Company Limited
	 
	 

	Print full name:
	Philip Li
	 
	Signature:

	Position:
	General Manager of Far East
	/s/ Philip Li

	Date:
	Oct. 24, 2016
	 
	 

    	
				
	Signed by a duly authorised director or officer for and on behalf of Kin Yat Industrial Company Ltd.
	 
	 

	Print full name:
	FUNG Wah Cheong, Vincent
	Signature:

	Position:
	Director
	/s/ Vincent Fung

	Date:
	Oct. 20, 2016
	 
	 

    	
				
	Signed by a duly authorised director or officer for and on behalf of Kin Yat (HK) Holdings Limited
	 
	 

	Print full name:
	FUNG Wah Cheong, Vincent
	Signature:

	Position:
	Director
	/s/ Vincent Fung

	Date:
	Oct. 20, 2016
	 
	 

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

Amendment #4 to Manufacturing Services Agreement Between: iRobot Corporation and
Kin Yat Industrial Company, Limited n/k/a Kin Yat (HK) Holdings Limited

Parties:

		
	(1)
	iRobot Corporation, a Delaware corporation with its principal place of business at 8 Crosby Drive, Bedford Massachusetts, 01730, USA ("iRobot")

		
	(2)
	Kin Yat (HK) Holdings Limited, including but not limited to its subsidiaries Kin Yat Industrial Company Limited and Kin Yat (Guizhou) Robot Company limited ("Kin Yat"), a Hong Kong corporation, having its principal place of business at 7/F., Galaxy Factory Building, 25-27 Luk Hop Street, San Po Kong, Kowloon, Hong Kong

WHEREAS, the Parties executed the Manufacturing Services Agreement dated September 23, 2013 as amendment by Amendment No. 1 dated August 6, 2014 and as amended by Amendment No. 2 dated June 1, 2015 and as amended by Amendment No. 3 dated October 20, 2016 (the "Agreement").

WHEREAS, for good and valuable consideration, the Parties hereby acknowledge and agree effective as of March 24, 2017, that pursuant to section 25.3 of the Agreement, the Parties wish to amend the Agreement as follows:

Replace Section 7 Delivery. Risk of Loss and Payment Terms as follows:

7 Delivery, Risk of Loss and Payment Terms. For purposes of this Agreement terms of sale for Product shipments shall be:

For export shipments title and risk of loss for Product will pass to iRobot (or to iRobot's designee invoiced by Kin Yat) FCA Port of Origin (per Intercoms 2010). For any shipments where Kin Yat acts as an agent in completing the Shipper's Export Declaration and managing iRobot's exports on behalf of iRobot, where iRobot is the exporter of record (Principal Party in Interest - PPI), iRobot hereby grants Kin Yat a limited Power of Attorney to act on its behalf in managing its exports.

For domestic (mainland China) shipments, ownership of Product, delivery cost, and guarantee rests with Kin Yat until delivery at iRobot's distributor's assigned warehouse.  Delivery for domestic shipments is DAP-iRobot distributor assigned warehouses. Said iRobot distributor assigned warehouse will be outlined on each individual P.O. issued.  Once Product is delivered to iRobot's distributor's assigned warehouse, ownership of Product, delivery cost, and guarantee all transfer to iRobot's distributor.

For clarity, sections 7.1- 7.4 remain as written.

If any conflict or inconsistency occurs between this Amendment and the Manufacturing Services Agreement, the provisions of this Amendment shall prevail. The remainder of the Manufacturing Services Agreement shall remain in full force and effect, unamended.

All parties below acknowledge and confirm the terms and conditions of the Agreement and this 

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

Amendment and agree to be bound by the terms and conditions of this Amendment.

	
				
	Signed by a duly authorised director or officer for and on behalf of iRobot Corporation
	 
	 

	Print full name:
	Oscar Zamorano
	 
	Signature:

	Position:
	SVP Operations & Supply Chain
	/s/ Oscar Zamarano

	Date:
	March 23, 2017
	 
	 

	
				
	Signed by a duly authorised director or officer for and on behalf of Kin Yat (HK) Holdings Limited
	 
	 

	Print full name:
	Vincent Fung
	 
	Signature:

	Position:
	Director
	/s/ Vincent Fung

	Date:
	March 23, 2017
	 
	 

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

Amendment #5 to the Manufacturing Services Agreement
		
	Between:
	iRobot Corporation and Kin Yat Industrial Company, Limited n/k/a Kin Yat (HK) Holdings Limited

PARTIES:
		
	(1)
	iRobot Corporation, a Delaware corporation with its principal place on business at 8 Crosby Drive, Bedford, Massachusetts, 01730, USA (“iRobot”)

		
	(2)
	Kin Yat (HK) Holdings Limited, including but not limited to its subsidiaries Kin Yat Industrial Company Limited and Kin Yat (Guizhou) Robot Company Limited, a Hong Kong corporation, having its principal place of business at 7/F, Galaxy Factory Building, 25-27 Luk Hop Street, San Po Kong, Kowloon, Hong Kong (“Supplier”) (together the “Parties”)

WHEREAS, the Parties executed the Manufacturing Services Agreement dated September 23, 2013 as amended by Amendment No. 1 dated August 6, 2014 and as amended by Amendment No. 2 dated June 1, 2015 and as amended by Amendment No. 3 dated October 20 2016 and as amended by Amendment No. 4 dated March 24, 2017 (the “Agreement”).
WHEREAS, for good and valuable consideration, the Parties hereby acknowledge and agree effective as on March 1, 2018, that pursuant to section 25.3 of the Agreement, the Parties wish to amend the Agreement as follows:
Parties:  The name of iRobot Corporation is hereby changed to iRobot Corporation and its subsidiaries (“iRobot”), a Delaware corporation having its principal office in 8 Crosby Drive Bedford MA.
The name of Kin Yat (HK) Holdings Limited, including but not limited to its subsidiaries Kin Yat Industrial Company Limited and Kin Yat (Guizhou) Robot Company Limited, (“Kin Yat”). Kin Yat’s principal office is located at 7/F., Galaxy Factory Building, 25-27 Luk Hop Street, San Po Kong, Kowloon, Hong Kong remains unchanged.
If any conflict or inconsistency occurs between this Amendment and the Agreement, the provisions of this Amendment shall prevail. The remainder of the Agreement shall remain in full force and effect, unamended.

The Parties have indicated the agreement to and acceptance of the amendments by executing below.
	
				
	Signed by a duly authorised director or officer for and on behalf of iRobot Corporation
	 
	 

	Print full name:
	Oscar Zamorano
	 
	Signature:

	Position:
	SVP Operations & Supply Chain
	/s/ Oscar Zamarano

	Date:
	 
	 
	 

	
				
	Signed by a duly authorised director or officer for and on behalf of Kin Yat (HK) Holdings Limited
	 
	 

	Print full name:
	Vincent Fung
	 
	Signature:

	Position:
	Director
	/s/ Vincent Fung

	Date:
	19 April 2018
	 
	 

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

Amendment #6 to Manufacturing Services Agreement
Between:  iRobot Corporation and Kin Yat Industrial Company Limited
Parties
		
	(1)
	iRobot Corporation, a Delaware corporation with its principal place of business at 8 Crosby Drive, Bedford, Massachusetts, 01730 (“iRobot”); and

		
	(2)
	Kin Yat Industrial Company Limited, a Hong Kong corporation, having its principal place of business at 7/F, Galaxy Factory Building, 25-27 Luk Hop Street, San Po Kong, Kowloon, Hong Kong (“Kin Yat”).

(iRobot and Kin Yat are each referred to as a Party or together as the Parties.)
WHEREAS, the Parties signed a Manufacturing Services Agreement effective from September 23, 2013, as amended (the “MSA”);
(Unless otherwise defined herein, capitalized terms used in this Amendment shall have the same meanings as those defined in the MSA)
AND WHEREAS, despite that iRobot and Kin Yat has agreed on Product Price (as defined in the MSA) for fiscal year 2018 of iRobot (equivalent to the [***]) on or about [***] (the “2018 Price”), and that Kin Yat has the obligation under clause 3.9.2 of the MSA to timely perform its obligations under the MSA and deliver within [***] of the delivery requirements of each accepted Purchase Order (as defined in the MSA) the relevant Products (as defined in the MSA), Kin Yat has requested for and iRobot has agreed, in concert with this Amendment, to an increase in price for all Roomba Products as well as a bonus for timely delivery of Products for [***];
AND WHEREAS, to ensure that Kin Yat would produce and deliver products under the MSA, iRobot has conceded to Kin Yat’s recent requests to increase the price for each goods and provide bonus payments in accordance with terms and conditions contained herein.
NOW, THEREFORE, in consideration of the agreements set forth herein and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Parties covenant and agree as follows:
1Increase in Price
iRobot agrees to increase the price of each unit of all Roomba Products by US$[***] per unit above the 2018 Price for all Roomba Products procured under accepted Purchase Orders dated [***] or later to be delivered on or after [***] up to and including [***].
2Bonuses
iRobot agrees to pay the following amount of bonus to Kin Yat under the following conditions :-
		
	(1)
	If the total units of Products delivered by Kin Yat under accepted Purchase Orders for delivery in [***] exceeds [***] units, iRobot agrees to pay to Kin Yat a bonus in the amount of US$[***];

		
	(2)
	If the total units of Products delivered by Kin Yat under accepted Purchase Orders for delivery in [***] exceeds [***] units, iRobot agrees to pay to Kin Yat additional bonus in the amount of US$[***]; 

		
	(3)
	If the total units of Products delivered by Kin Yat under accepted Purchase Orders for delivery in [***]exceeds [***] units, iRobot agrees to pay to Kin Yat further additional bonus in the amount of US$[***];

		
	(4)
	Within [***] upon fulfillment of each of the above-mentioned delivery targets, Kin Yat shall issue an invoice to iRobot stating the exact amount of Products delivered, the SKUs and details of the relevant Purchase Orders under which the Products were delivered;

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

		
	(5)
	Upon receipts of the invoices and verification of contents of the same, iRobot shall pay such bonus to Kin Yat in accordance with the usual payment terms between the Parties.

3Clause 3.6 of the MSA shall be amended by adding the following:
3.6 Payment for Materials.  Kin Yat shall pay all designated suppliers promptly in accordance with all terms and conditions agreed to between Kin Yat and the supplier.
4Clause 3.9.2 of the MSA shall be replaced in its entirety by the following:
3.9.2 Kin Yat agrees that time is of the essence with respect to all deliveries and performance.  If Kin Yat fails to timely perform or deliver within [***] of the delivery requirements of any standalone Purchase Order from iRobot, Kin Yat is liable to iRobot for all reasonable and direct loss and damage iRobot may suffer as a result of such delay including but not limited to expediting costs.  In the event of delay, Kin Yat shall use its best endeavors to minimize such delay and shall pay all expediting costs, including but not limited to expedited delivery costs and any additional labor costs.  Notwithstanding the foregoing, nothing in this Clause 3.9.2 shall be interpreted as amending Clause 24 (force majeure) or having Kin Yat liable for loss of profits and other indirect, special or consequential loss of iRobot due to delay where Kin Yat uses Commercially Reasonable Efforts to provide timely delivery.
5Clause 9.2 of the MSA shall be replaced in its entirety by the following:
		
	9.2
	Price.  The Price for each Product is set forth in Schedule 2 (the “Product Price), and includes the complete price for such Product, including the fully-costed bill of materials, Kin Yat’s Gross Margin (as defined in Schedule 2), and any and all other added fees and costs related to the Manufacturing Services, Reasonable and Customary Support Services.  The Product Price for each Product shall not be increased during the period beginning on the Effective Date and ending on [***], during such time Kin Yat shall manage its supply chain and absorb any and all increases.  Pricing will be reviewed by the Parties on [***] basis, on or before [***], and will be revised consistent with increases or decreases in materials, components, equipment and other costs and expenses applicable to the manufacture of the Product.  By [***], Kin Yat shall provide final fixed price quotation for upcoming iRobot fiscal year.  Once such final fixed price quotation has been agreed by the Parties for the upcoming iRobot fiscal year, the Product Price based on such final fixed price quotation for that fiscal year shall not be increased for whatever reason.

In the event that there is any price increase or decrease over any materials supplied by suppliers that are assigned by iRobot after all other reasonable avenues have been exhausted to avoid such price increase (including but not limited to [***]),[***].
6Clause 11.1 of the MSA shall be replaced in its entirety by the following:
		
	11.1
	Forecast.  iRobot will provide to Kin Yat, on [***], a non-binding, rolling [***] planning forecasts at a core robot level and on a SKU based level, indicating iRobot’s monthly Product requirements, as amended by iRobot from time to time (each, a “Forecast”).  Unless otherwise indicated by Kin Yat within [***] from receiving the Forecast or the amendment thereto by iRobot, Kin Yat is deemed to agree and undertake with iRobot that it will have the capacity and ability to manufacture, produce, and deliver such amount of Products as indicated in the Forecast.  If Kin Yat indicates that it is not capable of manufacture, produce, and deliver such amount of Products as indicate in the Forecast within [***], the Parties shall negotiate to reach an mutually agreeable Forecast, provided that unless there is substantial change in the circumstances which is notified to iRobot in advance, Kin Yat is not entitled to unilaterally refuse to agree to the Forecast if the monthly production amount stated in such Forecast is substantially the same as the actual production volume for previous months.  If Kin Yat unilaterally refuses to agree to a Forecast without notifying iRobot of any substantial change in the circumstances in advance, Kin Yat shall and undertakes to indemnify iRobot for any loss and damage it may incur due to such refusal.

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

In particular for [***], in view of the tight supply of labor in China, both Kin Yat and iRobot agree that the Forecast of the production volume to be undertaken by Kin Yat’s production facility in Shenzhen shall be approximately [***] units of Products.  The production period for [***] will be divided into a [***] and [***].  During [***], Kin Yat will build approximately [***] units, and during [***] Kin Yat will build approximately [***] units.  During each of [***] and [***], iRobot and Kin Yat will agree to evenly distribute production volume on [***] within the given period.  Specifically, the [***] target production during [***] will be [***] units per [***], and the [***] target production during [***] will be [***] units per [***], it being understood that Kin Yat will absorb variations in production to the targets plus or minus [***].
7Clause 11.2 of the MSA shall be replaced in its entirety by the following:
		
	11.2
	Purchase Orders.  iRobot will issue orders for Products hereunder using its standard form of purchase order (“Purchase Order”).  Each Purchase Order will identify the applicable Product by SKU, quantity, price denominated in US currency, delivery terms, and other customary terms.  The Product Price stated in the Purchase Order shall be the same as agreed upon by the Parties in accordance with Clause 9.2 hereinabove.  The delivery date contained in such Purchase Order shall correspond to the agreed lead time.  The terms and conditions in this Agreement shall prevail over any conflicting terms and conditions in any Purchase Order.  Such Purchase Orders will be issued by iRobot at least [***] prior to the date of ex-factory for all Products on each such Purchase Order.  For select SKUs and as defined in Schedule 1, iRobot and Kin Yat will develop strategies to achieve [***] lead time.  The total production volume in a month shall not deviate substantially from the amount stated in the correspondent Forecast for that particular month provided in accordance with Clause 11.1 above.

8Clause 11.3 of the MSA shall be replaced in its entirety by the following:
		
	11.3
	Purchase Order Acknowledgment.  Kin Yat will notify iRobot electronically within [***] if it utilizes EDI, or if in writing, within [***] of receipt of a Purchase Order.  Unless the amount of Products stipulated in a Purchase Order exceeds the amount stated in the correspondent Forecast provided in accordance with Clause 11.1 above, Kin Yat is not entitled to refuse to accept such Purchase Order, under which circumstance such Purchase Order shall constitute a binding obligation on Kin Yat to perform its obligations in accordance with this Agreement.

9Clause 11.6 of the MSA shall be replaced in its entirety by the following:
		
	11.6
	Production Increases. Rescheduling Delivery.  iRobot may, in writing, request increases in production volume or acceleration of open Purchase Order at any time.  Unless such request to increase production volume or acceleration of open Purchase Order would cause the production amount to exceed the relevant Forecast, Kin Yat is not entitled to refuse such request to increase production volume or acceleration of open Purchase Order and shall use its best endeavors to comply with such request in accordance with this Agreement, provided that unless the resultant total production volume in a month shall not deviate substantially from the amount stated in the correspondent Forecast for that particular month provided in accordance with Clause 11.1 above.  Any such change to an open Purchase Order shall be documented in a written change order and shall become effective upon signature of iRobot.  Kin Yat shall utilize its global supply network to assess availability of shared material across accounts to minimize instances in which Kin Yat is unable to meet an increase in a Purchase Order quantity requested by iRobot.  It is further understood that iRobot will not incur additional charges due to Kin Yat’s decision to meet an accelerated delivery schedule or request for increased quantities by utilizing Generic Components from another account’s material.

10If any conflict or inconsistency occurs between this Agreement and the MSA, the provisions of this Agreement shall prevail.  The remainder of the MSA shall remain in full force and effect.
IN WITNESS WHEREOF, this Agreement shall take effect when it has been executed below by the duly authorized representatives of the Parties.

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.

	
				
	Signed by a duly authorised director or officer for and on behalf of iRobot Corporation
	 
	 

	By:
	/s/ Christian Cerda
	 
	 

	Name:
	Christian Cerda
	 
	 

	Title:
	Chief Operating Officer
	 

	Date:
	15 October 2018
	 
	 

	
				
	Signed by a duly authorised director or officer for and on behalf of Kin Yat (HK) Holdings Limited
	 
	 

	By:
	/s/ Cheng Chor Kit
	 
	 

	Name:
	Cheng Chor Kit
	 
	 

	Title:
	Director
	 

	Date:
	15 Oct 2018
	 
	 

 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the Commission pursuant to the Company’s application requesting confidential treatment under Rule 24b-2 of the Exchange Act - [***] denotes omissions.Exhibit 4.3

 

IRON MOUNTAIN INCORPORATED

 

SENIOR INDENTURE

 

Dated as of [     ], 20[  ]

 

Wells Fargo Bank, National Association,

 

as Trustee

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE I.                              DEFINITIONS   AND INCORPORATION BY REFERENCE
    	
1
    
	
Section 1.1.
    	
DEFINITIONS
    	
1
    
	
Section 1.2.
    	
OTHER DEFINITIONS
    	
5
    
	
Section 1.3.
    	
INCORPORATION BY REFERENCE OF   TRUST INDENTURE ACT
    	
6
    
	
Section 1.4.
    	
RULES OF CONSTRUCTION
    	
6
    
	
 
    	
 
    	
 
    
	
ARTICLE II.                         THE   SECURITIES
    	
6
    
	
Section 2.1.
    	
ISSUABLE IN SERIES
    	
6
    
	
Section 2.2.
    	
ESTABLISHMENT OF TERMS OF SERIES   OF SECURITIES
    	
7
    
	
Section 2.3.
    	
EXECUTION AND AUTHENTICATION
    	
8
    
	
Section 2.4.
    	
REGISTRAR AND PAYING AGENT
    	
9
    
	
Section 2.5.
    	
PAYING AGENT TO HOLD MONEY FOR   BENEFIT OF HOLDERS
    	
10
    
	
Section 2.6.
    	
SECURITYHOLDER LISTS
    	
10
    
	
Section 2.7.
    	
TRANSFER AND EXCHANGE
    	
10
    
	
Section 2.8.
    	
MUTILATED, DESTROYED, LOST AND   STOLEN SECURITIES
    	
10
    
	
Section 2.9.
    	
OUTSTANDING SECURITIES
    	
11
    
	
Section 2.10.
    	
TREASURY SECURITIES
    	
11
    
	
Section 2.11.
    	
TEMPORARY SECURITIES
    	
11
    
	
Section 2.12.
    	
CANCELLATION
    	
12
    
	
Section 2.13.
    	
DEFAULTED INTEREST
    	
12
    
	
Section 2.14.
    	
RECORD DATE
    	
12
    
	
Section 2.15.
    	
GLOBAL SECURITIES
    	
12
    
	
Section 2.16.
    	
CUSIP NUMBERS
    	
13
    
	
 
    	
 
    	
 
    
	
ARTICLE III.                    REDEMPTION
    	
13
    
	
Section 3.1.
    	
NOTICE TO TRUSTEE
    	
13
    
	
Section 3.2.
    	
SELECTION OF SECURITIES TO BE   REDEEMED
    	
14
    
	
Section 3.3.
    	
NOTICE OF REDEMPTION
    	
14
    
	
Section 3.4.
    	
EFFECT OF NOTICE OF REDEMPTION
    	
15
    
	
Section 3.5.
    	
DEPOSIT OF REDEMPTION PRICE
    	
15
    
	
Section 3.6.
    	
SECURITIES REDEEMED IN PART
    	
15
    
	
 
    	
 
    	
 
    
	
ARTICLE IV.                     COVENANTS
    	
16
    
	
Section 4.1.
    	
PAYMENT OF PRINCIPAL AND INTEREST
    	
16
    
	
Section 4.2.
    	
REPORTS
    	
16
    
	
Section 4.3.
    	
COMPLIANCE CERTIFICATE
    	
16
    
	
Section 4.4.
    	
STAY, EXTENSION AND USURY LAWS
    	
17
    
	
Section 4.5.
    	
CORPORATE EXISTENCE
    	
17
    
	
Section 4.6.
    	
TAXES
    	
17
    
	
Section 4.7.
    	
MAINTENANCE OF OFFICE OR AGENCY
    	
17
    
	
 
    	
 
    	
 
    
	
ARTICLE V.                          SUCCESSORS
    	
18
    
	
Section 5.1.
    	
MERGERS, CONSOLIDATIONS OR SALE   OF ASSETS
    	
18
    
	
Section 5.2.
    	
SUCCESSOR CORPORATION SUBSTITUTED
    	
18
    
	
 
    	
 
    	
 
    
	
ARTICLE VI.                     DEFAULTS   AND REMEDIES
    	
18
    
	
Section 6.1.
    	
EVENTS OF DEFAULT
    	
18
    
	
Section 6.2.
    	
ACCELERATION OF MATURITY
    	
20
    
	
Section 6.3.
    	
COLLECTION OF INDEBTEDNESS AND   SUITS FOR ENFORCEMENT BY TRUSTEE
    	
20
    
	
Section 6.4.
    	
TRUSTEE MAY FILE PROOFS OF   CLAIM
    	
21
    
	
Section 6.5.
    	
TRUSTEE MAY ENFORCE CLAIMS   WITHOUT POSSESSION OF SECURITIES
    	
21
    
	
Section 6.6.
    	
APPLICATION OF MONEY COLLECTED
    	
21
    
	
Section 6.7.
    	
LIMITATION ON SUITS
    	
22
    

 

2

 

	
Section 6.8.
    	
UNCONDITIONAL RIGHT OF HOLDERS TO   RECEIVE PRINCIPAL AND INTEREST
    	
22 
    
	
Section 6.9.
    	
RESTORATION OF RIGHTS AND   REMEDIES
    	
22
    
	
Section 6.10.
    	
RIGHTS AND REMEDIES CUMULATIVE
    	
22
    
	
Section 6.11.
    	
DELAY OR OMISSION NOT WAIVER
    	
23
    
	
Section 6.12.
    	
CONTROL BY HOLDERS
    	
23
    
	
Section 6.13.
    	
WAIVER OF PAST DEFAULTS
    	
23
    
	
Section 6.14.
    	
UNDERTAKING FOR COSTS
    	
23
    
	
 
    	
 
    	
 
    
	
ARTICLE VII.                TRUSTEE
    	
24
    
	
Section 7.1.
    	
DUTIES OF TRUSTEE
    	
24
    
	
Section 7.2.
    	
RIGHTS OF TRUSTEE
    	
25
    
	
Section 7.3.
    	
INDIVIDUAL RIGHTS OF TRUSTEE
    	
26
    
	
Section 7.4.
    	
TRUSTEE’S DISCLAIMER
    	
26
    
	
Section 7.5.
    	
NOTICE OF DEFAULTS
    	
26
    
	
Section 7.6.
    	
REPORTS BY TRUSTEE TO HOLDERS
    	
26
    
	
Section 7.7.
    	
COMPENSATION AND INDEMNITY
    	
26
    
	
Section 7.8.
    	
REPLACEMENT OF TRUSTEE
    	
27
    
	
Section 7.9.
    	
SUCCESSOR TRUSTEE BY   MERGER, ETC.
    	
28
    
	
Section 7.10.
    	
ELIGIBILITY; DISQUALIFICATION
    	
28
    
	
Section 7.11.
    	
PREFERENTIAL COLLECTION OF CLAIMS   AGAINST COMPANY
    	
28
    
	
Section 7.12.
    	
AGENTS
    	
28
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII.           LEGAL   DEFEASANCE AND COVENANT DEFEASANCE
    	
29
    
	
Section 8.1.
    	
OPTION TO EFFECT LEGAL DEFEASANCE   OR COVENANT DEFEASANCE
    	
29
    
	
Section 8.2.
    	
LEGAL DEFEASANCE AND DISCHARGE
    	
29
    
	
Section 8.3.
    	
COVENANT DEFEASANCE
    	
29
    
	
Section 8.4.
    	
CONDITIONS TO LEGAL OR COVENANT   DEFEASANCE
    	
29
    
	
Section 8.5.
    	
DEPOSITED MONEY AND GOVERNMENT   SECURITIES TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS
    	
30
    
	
Section 8.6.
    	
REPAYMENT TO COMPANY
    	
31
    
	
Section 8.7.
    	
REINSTATEMENT
    	
31
    
	
 
    	
 
    	
 
    
	
ARTICLE IX.                     AMENDMENTS   AND WAIVERS
    	
31
    
	
Section 9.1.
    	
WITHOUT CONSENT OF HOLDERS
    	
31
    
	
Section 9.2.
    	
WITH CONSENT OF HOLDERS
    	
32
    
	
Section 9.3.
    	
LIMITATIONS
    	
33
    
	
Section 9.4.
    	
COMPLIANCE WITH TRUST INDENTURE   ACT
    	
33
    
	
Section 9.5.
    	
REVOCATION AND EFFECT OF CONSENTS
    	
33
    
	
Section 9.6.
    	
NOTATION ON OR EXCHANGE OF   SECURITIES
    	
34
    
	
Section 9.7.
    	
TRUSTEE TO SIGN AMENDMENTS;   TRUSTEE PROTECTED
    	
34
    
	
 
    	
 
    	
 
    
	
ARTICLE X.                          SATISFACTION   AND DISCHARGE
    	
34
    
	
Section 10.1.
    	
SATISFACTION AND DISCHARGE
    	
34
    
	
 
    	
 
    	
 
    
	
ARTICLE XI                        MISCELLANEOUS
    	
35
    
	
Section 11.1.
    	
TRUST INDENTURE ACT CONTROLS
    	
35
    
	
Section 11.2.
    	
NOTICES
    	
35
    
	
Section 11.3.
    	
COMMUNICATION BY HOLDERS WITH   OTHER HOLDERS
    	
36
    
	
Section 11.4.
    	
CERTIFICATE AND OPINION AS TO   CONDITIONS PRECEDENT
    	
36
    
	
Section 11.5.
    	
STATEMENTS REQUIRED IN   CERTIFICATE OR OPINION
    	
36
    
	
Section 11.6.
    	
RULES BY TRUSTEE AND AGENTS
    	
37
    
	
Section 11.7.
    	
LEGAL HOLIDAYS
    	
37
    
	
Section 11.8.
    	
NO PERSONAL LIABILITY OF   DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS
    	
37
    
	
Section 11.9.
    	
COUNTERPARTS
    	
37
    
	
Section 11.10.
    	
GOVERNING LAWS
    	
37
    
	
Section 11.11.
    	
NO ADVERSE INTERPRETATION OF   OTHER AGREEMENTS
    	
37
    
	
Section 11.12.
    	
SUCCESSORS
    	
37
    

 

3

 

	
Section 11.13.
    	
SEVERABILITY
    	
37
    
	
Section 11.14.
    	
TABLE OF CONTENTS,   HEADINGS, ETC.
    	
37
    
	
Section 11.15.
    	
SECURITIES IN A FOREIGN CURRENCY   OR IN EUROS
    	
38
    
	
Section 11.16.
    	
JUDGMENT CURRENCY
    	
38
    
	
Section 11.17.
    	
WAIVER OF JURY TRIAL
    	
39
    
	
Section 11.18.
    	
SUBMISSION TO JURISDICTION; VENUE
    	
39
    
	
Section 11.19.
    	
FORCE MAJEURE
    	
39
    
	
 
    	
 
    	
 
    
	
ARTICLE XII.                SINKING   FUNDS
    	
39
    
	
Section 12.1.
    	
APPLICABILITY OF ARTICLE
    	
39
    
	
Section 12.2.
    	
SATISFACTION OF SINKING FUND   PAYMENTS WITH SECURITIES
    	
39
    
	
Section 12.3.
    	
REDEMPTION OF SECURITIES FOR   SINKING FUND
    	
40
    
	
 
    	
 
    	
 
    
	
ARTICLE XIII.           SUBSIDIARY   GUARANTEES
    	
40
    
	
Section 13.1.
    	
SUBSIDIARY GUARANTEE
    	
40
    
	
Section 13.2.
    	
LIMITATION OF GUARANTOR’S   LIABILITY
    	
41
    
	
 
    	
 
    	
 
    
	
ARTICLE XIV.            USA   PATRIOT ACT
    	
42
    
	
Section 14.1.
    	
USA PATRIOT ACT
    	
42
    

 

4

 

IRON MOUNTAIN INCORPORATED

 

Reconciliation and tie between Trust Indenture Act of 1939 and
 Indenture, dated as of [    ], 20[  ]

 

	
§ 310(a)(1)
    	
 
    	
7.10
    
	
(a)(2)
    	
 
    	
7.10
    
	
(a)(3)
    	
 
    	
Not Applicable
    
	
(a)(4)
    	
 
    	
Not Applicable
    
	
(a)(5)
    	
 
    	
7.10
    
	
(b)
    	
 
    	
7.10
    
	
§ 310(c)
    	
 
    	
Not Applicable
    
	
§ 311(a)
    	
 
    	
7.11
    
	
(b)
    	
 
    	
7.11
    
	
(c)
    	
 
    	
Not Applicable
    
	
§ 312(a)
    	
 
    	
2.6
    
	
(b)
    	
 
    	
11.3
    
	
(c)
    	
 
    	
11.3
    
	
§ 313(a)
    	
 
    	
7.6
    
	
(b)(1)
    	
 
    	
7.6
    
	
(b)(2)
    	
 
    	
7.6
    
	
(c)
    	
 
    	
7.6, 11.2
    
	
(c)(1)
    	
 
    	
7.6
    
	
(c)(2)
    	
 
    	
7.6
    
	
(c)(3)
    	
 
    	
7.6
    
	
(d)
    	
 
    	
7.6
    
	
§ 314(a)
    	
 
    	
4.2, 4.3, 11.5
    
	
(b)
    	
 
    	
Not Applicable
    
	
(c)(1)
    	
 
    	
11.4
    
	
(c)(2)
    	
 
    	
11.4
    
	
(c)(3)
    	
 
    	
Not Applicable
    
	
(d)
    	
 
    	
Not Applicable
    
	
(e)
    	
 
    	
11.5
    
	
(f)
    	
 
    	
Not Applicable
    
	
§ 315(a)
    	
 
    	
7.1(b)
    
	
(b)
    	
 
    	
7.5
    
	
(c)
    	
 
    	
7.1
    
	
(d)
    	
 
    	
7.1
    
	
(e)
    	
 
    	
6.14
    
	
§ 316(a)
    	
 
    	
2.10
    
	
(a)(1)(A)
    	
 
    	
6.12
    
	
(a)(1)(B)
    	
 
    	
6.13
    
	
(b)
    	
 
    	
6.8
    
	
§ 316(c)
    	
 
    	
2.14
    
	
§ 317(a)(1)
    	
 
    	
6.3
    
	
(a)(2)
    	
 
    	
6.4
    
	
(b)
    	
 
    	
2.5
    
	
§ 318(a)
    	
 
    	
11.1
    
	
(b)
    	
 
    	
Not Applicable
    
	
(c)
    	
 
    	
Not Applicable
    

 

Note:  This reconciliation and tie shall not, for any purpose, be deemed to be part of the Indenture.

 

5

 

Senior Indenture dated as of [    ], 20[  ] among Iron Mountain Incorporated, a Delaware corporation (the “Company”), the guarantors party hereto and Wells Fargo Bank, National Association, a national banking association, as Trustee (“Trustee”).

 

Each party agrees as follows for the benefit of each other party and for the equal and ratable benefit of the Holders of the Securities issued under this Indenture.

 

ARTICLE I.
 DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.1.                                 DEFINITIONS.

 

“Additional Amounts” means any additional amounts which are required hereby or by any Security, under circumstances specified herein or therein, to be paid by the Company in respect of certain taxes imposed on Holders specified therein and which are owing to such Holders.

 

“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 the management and policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided, however, that beneficial ownership of 10% or more of the voting securities of a Person shall be deemed to be control.

 

“Agent” means any Registrar, Paying Agent, Service Agent or authenticating agent.

 

“Authorized Newspaper” means a newspaper, in the English language or  in an official language of the country of publication, customarily published on each Business Day, whether or not published on Saturdays, Sundays or holidays, and of general circulation in each place in connection with which the term is used or in the financial community of each such place.  If it shall be impractical in the opinion of the Trustee to make any publication of any notice required hereby in an Authorized Newspaper, any publication or other notice in lieu thereof that is made or given by the Trustee shall constitute a sufficient publication of such notice.

 

“Bearer Security” means any Security, including any interest coupon appertaining thereto, that does not provide for the identification of the Holder thereof.

 

“Board of Directors” means the Board of Directors, managers, trustees or comparable governing body of a Person or any duly authorized committee thereof.

 

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been adopted by the Board of Directors or pursuant to authorization by the Board of Directors and to be in full force and effect on the date of the certificate and delivered to the Trustee.

 

“Business Day” means, unless otherwise provided by supplemental indenture hereto for a particular Series, any day except a Saturday, Sunday or a legal holiday in the City of New York or at another place of payment where a legal holiday shall be any day on which banking institutions are authorized or required by law, regulation or executive order to close.

 

“Capital 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 so required to be capitalized on the balance sheet in accordance with GAAP.

 

“Capital Stock” means any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock, including, without limitation, with respect to limited liability companies or

 

1

 

partnerships, limited liability company interests or partnership interests (whether general or limited) and 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, such limited liability company or partnership.

 

“Code” means the Internal Revenue Code of 1986, as amended.

 

“Company” means the party named as such above until a successor replaces it and thereafter means the successor.

 

“Company Order” means a written order signed in the name of the Company by an Officer.

 

“Corporate Trust Office” means a principal office of the Trustee at which at any time its corporate trust business shall be administered, which office at the date hereof is located at 150 East 42nd Street, 40th Floor, New York, New York 10017, Attention: Corporate Trust Services Administrator — Iron Mountain Incorporated, or such other address as the Trustee may designate from time to time by notice to the Holders and the Company, or the principal corporate trust office of any successor Trustee (or such other address as a successor Trustee may designate from time to time by notice to the Holders and the Company).

 

“Default” means any event that is or with the passage of time or the giving of notice or both would be an Event of Default.

 

“Depository” means, with respect to the Securities of any Series issuable or issued in whole or in part in the form of one or more Global Securities, the Person designated as Depository for such Series by the Company, which Depository shall be a clearing agency registered under the Exchange Act; and if at any time there is more than one such Person, “Depository” as used with respect to the Securities of any Series shall mean the Depository with respect to the Securities of such Series.

 

“Discount Security” means any Security that provides for an amount less than the stated principal amount thereof to be due and payable upon declaration of acceleration of the maturity thereof pursuant to Section 6.2.

 

“Disqualified Stock” means any Capital Stock which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, matures or is mandatorily redeemable, for cash or other property (other than Capital Stock that is not Disqualified Stock) pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the Securityholder thereof, in whole or in part, in each case on or prior to the stated maturity of the Securities.

 

“Dollars” and “$” mean lawful money of the United States of America.

 

“Euro” means the single currency of participating member states of the economic and monetary union as contemplated in the Treaty on European Union.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“Foreign Currency” means any currency or currency unit issued by a government other than the government of the United States of America.

 

“GAAP” means accounting principles generally accepted in the United States of America which are in effect on the date set forth in a supplemental indenture for a particular Series.

 

“Global Security” or “Global Securities” means a Security or Securities, as the case may be, in the form established pursuant to Section 2.2 evidencing all or part of a Series of Securities, issued to the Depository for such Series or its nominee, and registered in the name of such Depository or nominee.

 

2

 

“Government Securities” means direct obligations of, or obligations guaranteed by, the United States of America for the payment of which guarantee or obligations the full faith and credit of the United States of America is pledged.

 

“Guarantee” means, as applied to any obligation: (a) a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner, of any part or all of such obligation; and (b) an agreement, direct or indirect, contingent or otherwise, the practical effect of which is to assure in any way the payment or performance (or payment of damages in the event of non-performance) of all or any part of such obligation, including, without limiting the foregoing, the obligation to reimburse amounts drawn down under letters of credit securing such obligations.

 

“Hedging Obligations” means, with respect to any specified Person, the obligations of such Person under:

 

(a)                                 interest rate swap agreements (whether from fixed to floating or from floating to fixed), interest rate cap agreements and interest rate collar agreements;

 

(b)                                 other agreements or arrangements designed to manage interest rates or interest rate risk; and

 

(c)                                  other agreements or arrangements designed to protect such Person against fluctuations in currency exchange rates or commodity prices.

 

“Holder” or “Securityholder” means a Person in whose name a Security is registered or the holder of a Bearer Security.

 

“Indebtedness” means (without duplication), with respect to any Person, whether recourse is to all or a portion of the assets of such Person, and whether or not contingent:

 

(a) every obligation of such Person for money borrowed;

 

(b) every obligation of such Person evidenced by bonds, debentures, notes or other similar instruments

 

(c) every reimbursement obligation of such Person with respect to letters of credit, bankers’ acceptances or similar facilities issued for the account of such Person;

 

(d) every obligation of such Person issued or assumed as the deferred purchase price of property or services;

 

(e) every Capital Lease Obligation;

 

(f) all Disqualified Stock of such Person valued at the greater of its voluntary or involuntary maximum fixed repurchase price, plus accrued and unpaid dividends (unless included in such maximum repurchase price);

 

(g) all obligations of such Person under or with respect to Hedging Obligations which would be required to be reflected on the balance sheet as a liability of such Person in accordance with GAAP; and

 

(h) every obligation of the type referred to in clauses (a) through (g) of another Person and dividends of another Person the payment of which, in either case, such Person has Guaranteed.

 

For purposes of this definition, the “maximum fixed repurchase price” of any Disqualified Stock that does not have a fixed repurchase price will be calculated in accordance with the terms of such Disqualified Stock as if such Disqualified Stock were repurchased on any date on which Indebtedness is required to be determined pursuant to this Indenture.  Notwithstanding the foregoing, trade accounts payable and accrued liabilities arising in the ordinary course of business and any liability for U.S. federal, state or local taxes or other taxes owed by such Person shall not be considered Indebtedness for purposes of this definition.  The amount outstanding at any time of any

 

3

 

Indebtedness issued with original issue discount is the aggregate principal amount at maturity of such Indebtedness, less the remaining unamortized portion of the original issue discount of such Indebtedness at such time, as determined in accordance with GAAP.  Indebtedness shall be calculated without giving effect to the effects of Statement of Financial Accounting Standards No. 133 and related interpretations to the extent such effects would otherwise increase or decrease an amount of Indebtedness for any purpose hereunder as a result of accounting for any embedded derivatives created by the terms of such Indebtedness.  For the avoidance of doubt, the aggregate amount of debit balances in the accounts of Restricted Subsidiaries held at a bank or other financial institution and subject to a cash pooling arrangement shall only constitute “Indebtedness” to the extent that such aggregate amount exceeds the aggregate amount of all credit balances in the accounts of Restricted Subsidiaries held at such bank or financial institution and subject to such cash pooling arrangement.

 

“Indenture” means this Indenture as amended and supplemented from time to time and shall include the form and terms of particular Series of Securities established as contemplated hereunder and any related supplemental indenture.

 

“interest” with respect to any Discount Security which by its terms bears interest only after Maturity, means interest payable after Maturity.

 

“Maturity,” when used with respect to any Security, means the date on which the principal of such Security or such installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption, notice of option to elect repayment or otherwise.

 

“Officer” means the Chairman of the Board, any other Director, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, any Vice President (including any Executive or Senior Vice President), the Treasurer, the Controller, the Secretary, any Assistant Treasurer or any Assistant Secretary of any Person.

 

“Officers’ Certificate” means a certificate signed, unless otherwise specified, by any two of the Chairman of the Board, a Vice Chairman of the Board, the Chief Executive Officer, the President, the Chief Financial Officer, the Treasurer, the Controller or any Vice President (including any Executive or Senior Vice President) of the Company.

 

“Opinion of Counsel” means a written opinion of legal counsel, which opinion is reasonably acceptable to the Trustee.  Such counsel may be an employee of or counsel to the Company or a Subsidiary thereof.

 

“Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

 

“principal” of a Security means the principal of the Security plus, when appropriate, the premium, if any, on, and any Additional Amounts in respect of, the Security.

 

“Responsible Officer” means, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee, including any managing director, director, vice president, assistant vice president, assistant treasurer, trust officer, associate or any other officer of the Trustee who customarily performs functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.

 

“Restricted Subsidiary” shall have the meaning set forth in the applicable supplemental indenture as to each Series of Securities.  If not defined in the applicable supplemental indenture, then there shall be no Restricted Subsidiaries as to such Series.

 

“SEC” means the United States Securities and Exchange Commission.

 

4

 

“Securities” means the debentures, notes or other instruments of Indebtedness of the Company of any Series authenticated and delivered under this Indenture.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“Series” or “Series of Securities” means each series of debentures, notes or other debt instruments of the Company created pursuant to Sections 2.1 and 2.2 hereof.

 

“Significant Subsidiary” means any Subsidiary that would be a “significant subsidiary” within the meaning of Regulation S-X under the Securities Act.

 

“Stated Maturity” when used with respect to any Security or any installment of principal thereof or interest thereon, means the date specified in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.

 

“Subsidiary” means, with respect to any Person, any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person or a combination thereof.

 

“Subsidiary Guarantee” means a Guarantee of a Guarantor pursuant to Article XIII hereof.

 

“TIA” means the Trust Indenture Act of 1939 (15 U.S. Code Sections 77aaa-77bbbb) as in effect on the date of this Indenture; provided, however, that in the event the Trust Indenture Act of 1939 is amended after such date, “TIA” means, to the extent required by any such amendment, the Trust Indenture Act as so amended.

 

“Trustee” means the Person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean or include each Person who is then a Trustee hereunder, and if at any time there is more than one such Person, “Trustee” as used with respect to the Securities of any Series shall mean the Trustee with respect to Securities of that Series.

 

Section 1.2.                                 OTHER DEFINITIONS.

 

	
TERM
    	
 
    	
DEFINED IN SECTION
    
	
“Bankruptcy Law”
    	
 
    	
6.1
    
	
“Benefited Party”
    	
 
    	
13.1
    
	
“Covenant Defeasance”
    	
 
    	
8.3
    
	
“Custodian”
    	
 
    	
6.1
    
	
“Event of Default”
    	
 
    	
6.1
    
	
“Guarantor”
    	
 
    	
13.1
    
	
“Journal”
    	
 
    	
11.15
    
	
“Judgment Currency”
    	
 
    	
11.16
    
	
“Legal Defeasance”
    	
 
    	
8.2
    
	
“Legal Holiday”
    	
 
    	
11.7
    
	
“mandatory sinking fund payment”
    	
 
    	
12.1
    
	
“Market Exchange Rate”
    	
 
    	
11.15
    
	
“New York Banking Day”
    	
 
    	
11.16
    
	
“optional sinking fund payment”
    	
 
    	
12.1
    
	
“Paying Agent”
    	
 
    	
2.4
    
	
“Registrar”
    	
 
    	
2.4
    
	
“Required Currency”
    	
 
    	
11.16
    
	
“Service Agent”
    	
 
    	
2.4
    
	
“Successor Person”
    	
 
    	
5.2
    

 

5

 

Section 1.3.                                 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.

 

Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture.  The following TIA terms used in this Indenture have the following meanings:

 

“indenture securities” means the Securities and the Subsidiary Guarantees, if any.

 

“indenture security holder” means a Holder or a Securityholder.

 

“indenture to be qualified” means this Indenture.

 

“indenture trustee” or “institutional trustee” means the Trustee.

 

“obligor” on the indenture securities means the Company, the Guarantors, if any, and any successor obligor upon the Securities or any Subsidiary Guarantee, as the case may be.

 

All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule under the TIA and not otherwise defined herein are used herein as so defined.

 

Section 1.4.                                 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 GAAP;

 

(c)                                  “or” is not exclusive;

 

(d)                                 words in the singular include the plural, and in the plural include the singular;

 

(e)                                  provisions apply to successive events and transactions; and

 

(f)                                   references to sections of or rules under the Securities Act or the Exchange Act shall be deemed to include substitute, replacement or successor sections or rules adopted by the SEC from time to time.

 

ARTICLE II.
 THE SECURITIES

 

Section 2.1.                                 ISSUABLE IN SERIES.

 

The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited.  The Securities may be issued in one or more Series.  All Securities of a Series shall be identical except as may be set forth in a Board Resolution, a supplemental indenture or an Officers’ Certificate detailing the adoption of the terms thereof pursuant to the authority granted under a Board Resolution.  In the case of Securities of a Series to be issued from time to time, the Board Resolution, Officers’ Certificate or supplemental indenture may provide for the method by which specified terms (such as interest rate, maturity date, record date or date from which interest shall accrue) are to be determined.  Securities may differ between Series in respect of any matters, provided that all Series of Securities shall be equally and ratably entitled to the benefits of the Indenture.

 

6

 

Section 2.2.                                 ESTABLISHMENT OF TERMS OF SERIES OF SECURITIES.

 

At or prior to the issuance of any Securities within a Series, the following shall be established (as to the Series generally, in the case of Subsection 2.2.1 and either as to such Securities within the Series or as to the Series generally in the case of Subsections 2.2.2 through 2.2.21) by a Board Resolution, a supplemental indenture or an Officers’ Certificate pursuant to authority granted under a Board Resolution:

 

Section 2.2.1                          the title of the Series (which shall distinguish the Securities of that particular Series from the Securities of any other Series);

 

Section 2.2.2                          the price or prices (expressed as a percentage of the principal amount thereof) at which the Securities of the Series will be issued;

 

Section 2.2.3                          any limit upon the aggregate principal amount of the Securities of the Series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the Series pursuant to Section 2.7, 2.8, 2.11, 3.6 or 9.6, or any applicable provision of a supplemental indenture);

 

Section 2.2.4                          the date or dates on which the principal of the Securities of the Series is payable;

 

Section 2.2.5                          the rate or rates (which may be fixed or variable) per annum or, if applicable, the method used to determine such rate or rates (including, but not limited to, any commodity, commodity index, stock exchange index or financial index) at which the Securities of the Series shall bear interest, if any, the date or dates from which such interest, if any, shall accrue, the date or dates on which such interest, if any, shall commence and be payable and any regular record date for the interest payable on any interest payment date;

 

Section 2.2.6                          the place or places where the principal of and interest, if any, on the Securities of the Series shall be payable, or the method of such payment, if by wire transfer, mail or other means;

 

Section 2.2.7                          if applicable, the period or periods within which, the price or prices at which and the terms and conditions upon which the Securities of the Series may be redeemed, in whole or in part, at the option of the Company;

 

Section 2.2.8                          the obligation, if any, of the Company to redeem or purchase the Securities of the Series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the Series shall be redeemed or purchased, in whole or in part, pursuant to such obligation;

 

Section 2.2.9                          the dates, if any, on which and the price or prices at which the Securities of the Series will be repurchased by the Company at the option of the Holders thereof and other detailed terms and provisions of such repurchase obligations;

 

Section 2.2.10                   if other than denominations of $1,000 and any integral multiple thereof, the denominations in which the Securities of the Series shall be issuable;

 

Section 2.2.11                   the forms of the Securities of the Series in bearer or fully registered form (and, if in fully registered form, whether the Securities will be issuable as Global Securities);

 

Section 2.2.12                   if other than the principal amount thereof, the portion of the principal amount of the Securities of the Series that shall be payable upon declaration of acceleration of the maturity thereof pursuant to Section 6.2;

 

Section 2.2.13                   the currency of denomination of the Securities of the Series, which may be Dollars or any Foreign Currency, including, but not limited to, the Euro, and if such currency of denomination is a composite currency other than the Euro, the agency or organization, if any, responsible for overseeing such composite currency;

 

7

 

Section 2.2.14                   the designation of the currency, currencies or currency units in which payment of the principal of and interest, if any, on the Securities of the Series will be made;

 

Section 2.2.15                   if payments of principal of or interest, if any, on the Securities of the Series are to be made in one or more currencies or currency units other than that or those in which such Securities are denominated, the manner in which the exchange rate with respect to such payments will be determined;

 

Section 2.2.16                   the manner in which the amounts of payment of principal of or interest, if any, on the Securities of the Series will be determined, if such amounts may be determined by reference to an index based on a currency or currencies or by reference to a commodity, commodity index, stock exchange index or financial index;

 

Section 2.2.17                   the provisions, if any, relating to any security provided for the Securities of the Series;

 

Section 2.2.18                   any addition to or change in the Events of Default which applies to any Securities of the Series and any change in the right of the Trustee or the requisite Holders of such Securities to declare the principal amount thereof due and payable pursuant to Section 6.2;

 

Section 2.2.19                   any addition to or change in the covenants set forth in Articles IV or V which applies to Securities of the Series;

 

Section 2.2.20                   any other terms of the Securities of the Series (which may modify or delete any provision of this Indenture insofar as it applies to such Series); and

 

Section 2.2.21                   any depositories, interest rate calculation agents, exchange rate calculation agents or other agents with respect to Securities of such Series if other than those appointed herein.

 

Securities of any one Series need not be issued at the same time and may be issued from time to time, consistent with the terms of this Indenture, if so provided by or pursuant to the Board Resolution, supplemental indenture or Officers’ Certificate referred to above, and the authorized principal amount of any Series may not be increased to provide for issuances of additional Securities of such Series, unless otherwise provided in such Board Resolution, supplemental indenture or Officers’ Certificate.

 

Section 2.3.                                 EXECUTION AND AUTHENTICATION.

 

At least one Officer shall sign the Securities for the Company by manual or facsimile signature.  An Officer of any Guarantor shall sign the Subsidiary Guarantee, or in lieu thereof, this Indenture or any supplemental indenture, as the case may be, for such Guarantor by manual or facsimile signature.

 

If an Officer whose signature is on a Security or Subsidiary Guarantee no longer holds that office at the time the Security is authenticated, the Security or Subsidiary Guarantee shall nevertheless be valid.

 

A Security shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.  Such signature shall be conclusive evidence that the Security has been authenticated under this Indenture.

 

The Trustee shall at any time, and from time to time, authenticate Securities for original issue in the principal amount provided in the Board Resolution, supplemental indenture hereto or Officers’ Certificate, upon receipt by the Trustee of a Company Order.  Such Company Order may authorize authentication and delivery pursuant to written or electronic signed instructions from the Company or its duly authorized agent or agents.  Each Security shall be dated the date of its authentication unless otherwise provided by a Board Resolution, a supplemental indenture hereto or an Officers’ Certificate.

 

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The aggregate principal amount of Securities of any Series outstanding at any time may not exceed any limit upon the maximum principal amount for such Series set forth in the Board Resolution, supplemental indenture hereto or Officers’ Certificate delivered pursuant to Section 2.2, except as provided in Section 2.8.

 

Prior to the issuance of Securities of any Series, the Trustee shall have received and (subject to Section 7.2) shall be fully protected in relying on: (a) the Board Resolution, supplemental indenture hereto or Officers’ Certificate establishing the form of the Securities of that Series or of Securities within that Series and the terms of the Securities of that Series or of Securities within that Series, (b) an Officers’ Certificate complying with Sections 10.4 and 10.5, and (c) an Opinion of Counsel complying with Sections 10.4 and 10.5.

 

The Trustee shall have the right to decline to authenticate and deliver any Securities of such Series: (a) if the Trustee, being advised by counsel, determines that such action may not lawfully be taken; or (b) if the Trustee in good faith by any of the following: its board of directors or trustees, executive committee or a trust committee of Responsible Officers, directors and/or vice-presidents shall determine that such action would reasonably be expected to expose the Trustee to personal liability to Holders of any then outstanding Series of Securities.

 

The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities.  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 authenticating agent.  An authenticating agent has the same rights as an Agent to deal with the Company or an Affiliate.

 

Section 2.4.                                 REGISTRAR AND PAYING AGENT.

 

The Company shall maintain, with respect to each Series of Securities, at the place or places specified with respect to such Series pursuant to Section 2.2, an office or agency where Securities of such Series may be presented or surrendered for payment (“Paying Agent”), where Securities of such Series may be surrendered for registration of transfer or exchange (“Registrar”) and where notices and demands to or upon the Company in respect of the Securities of such Series and this Indenture may be served (“Service Agent”).  For the avoidance of doubt, the Service Agent shall not accept service of process on behalf of the Company, any Guarantor or any other party. The Registrar shall keep a register with respect to each Series of Securities and to their transfer and exchange.  The Company will give prompt written notice to the Trustee of the name and address, and any change in the name or address, of each Registrar, Paying Agent or Service Agent.  If at any time the Company shall fail to maintain any such required Registrar or Paying Agent or shall fail to furnish the Trustee with the name and address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.

 

The Company may also from time to time designate one or more co-registrars, additional paying agents or additional service agents and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligations to maintain a Registrar, Paying Agent and Service Agent in each place so specified pursuant to Section 2.2 for Securities of any Series for such purposes.  The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the name or address of any such co-registrar, additional paying agent or additional service agent.  The term “Registrar” includes any co-registrar; the term “Paying Agent” includes any additional paying agent; and the term “Service Agent” includes any additional service agent.  The Company or any Guarantor may act as Paying Agent, Registrar or Service Agent.  The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture, which shall be subject to any obligations imposed by the provisions of the TIA.  The agreement shall implement the provisions of this Indenture that relate to such Agent.

 

The Company hereby appoints the Trustee as the initial Registrar and Paying Agent for each Series unless another Registrar and Paying Agent, as the case may be, is appointed prior to the time Securities of that Series are first issued.

 

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Section 2.5.                                 PAYING AGENT TO HOLD MONEY FOR BENEFIT OF HOLDERS.

 

The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold, for the benefit of Securityholders of any Series of Securities, or the Trustee, all money held by the Paying Agent for the payment of principal of or premium, if any, or interest on the Series of Securities, and will notify the Trustee of any default by the Company or the Guarantors in making any such payment.  While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee.  The Company at any time may require a Paying Agent to pay all money held by it to the Trustee.  Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for the money delivered to the Trustee.  If the Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of Securityholders of any Series of Securities all money held by it as Paying Agent.

 

Section 2.6.                                 SECURITYHOLDER LISTS.

 

The Registrar shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders of each Series of Securities and shall otherwise comply with TIA Section 312(a).  If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least ten 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 Securityholders of each Series of Securities.

 

Section 2.7.                                 TRANSFER AND EXCHANGE.

 

Where Securities of a Series are presented to the Registrar or a co-registrar with a request to register a transfer or to exchange them for an equal principal amount of Securities of the same Series, the Registrar shall register the transfer or make the exchange if its requirements for such transactions are met.  To permit registrations of transfers and exchanges, the Trustee shall authenticate Securities at the Registrar’s request.  No service charge shall be made to a Securityholder for any registration of transfer or exchange (except as otherwise expressly permitted in a Board Resolution, a supplemental indenture or an Officers’ Certificate relating to Securities of a Series), but the Company may require payment of a sum sufficient to cover any taxes, duties or similar governmental charge payable in connection therewith (other than any such taxes, duties or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.11, 3.6 or 9.6).

 

Neither the Company nor the Registrar shall be required (a) to issue, register the transfer of, or exchange Securities of any Series for the period beginning at the opening of business fifteen days immediately preceding the mailing of a notice of redemption of Securities of that Series selected for redemption and ending at the close of business on the day of such mailing, or (b) to register the transfer of or exchange Securities of any Series selected, called or being called for redemption as a whole or the portion being redeemed of any such Securities selected, called or being called for redemption in part.

 

Section 2.8.                                 MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.

 

If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Security of the same Series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.

 

If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute and upon its request the Trustee shall authenticate and make available for delivery, in lieu of any such destroyed, lost or stolen Security, a new Security of the same Series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.

 

In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security.

 

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Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith.

 

Every new Security of any Series issued pursuant to this Section in lieu of any destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of that Series duly issued hereunder.

 

The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

 

Section 2.9.                                 OUTSTANDING SECURITIES.

 

The Securities outstanding at any time are all the Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those reductions in the interest on a Global Security effected by the Trustee in accordance with the provisions hereof and those described in this Section as not outstanding.

 

If a Security is replaced pursuant to Section 2.8, it ceases to be outstanding until the Trustee receives proof satisfactory to it that the replaced Security is held by a bona fide purchaser.

 

If the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any thereof) holds on the Maturity of Securities of a Series or any redemption date money sufficient to pay such Securities payable on that date, then on and after that date such Securities of the Series cease to be outstanding and interest on them ceases to accrue.

 

A Security does not cease to be outstanding because the Company, a Guarantor or an Affiliate of the Company or a Guarantor holds the Security.

 

In determining whether the Holders of the requisite principal amount of outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, the principal amount of a Discount Security that shall be deemed to be outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the Maturity thereof pursuant to Section 6.2.

 

Section 2.10.                          TREASURY SECURITIES.

 

In determining whether the Holders of the required principal amount of Securities of a Series have concurred in any request, demand, authorization, direction, notice, consent or waiver, Securities of a Series owned by the Company or an Affiliate shall be disregarded, except that for the purposes of determining whether the Trustee shall be protected in relying on any such request, demand, authorization, direction, notice, consent or waiver, only Securities of a Series that a Responsible Officer of the Trustee actually knows are so owned shall be so disregarded.  Notwithstanding the foregoing, Securities of a Series that are to be acquired by the Company, any Guarantor, any Subsidiary of the Company or any Guarantor or an Affiliate of the Company or any Guarantor pursuant to an exchange offer, tender offer or other agreement shall not be deemed to be owned by the Company, such Guarantor, a Subsidiary of the Company or such Guarantor or an Affiliate of the Company or such Guarantor until legal title to such Securities passes to the Company, such Guarantor, such Subsidiary or such Affiliate, as the case may be.

 

Section 2.11.                          TEMPORARY SECURITIES.

 

Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities upon a Company Order.  Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company considers appropriate for temporary Securities.  Without unreasonable delay, the Company shall prepare and the Trustee or an authenticating agent upon

 

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request shall authenticate definitive Securities of the same Series and date of maturity in exchange for temporary Securities.  Until so exchanged, temporary securities shall have the same rights under this Indenture as the definitive Securities.

 

Section 2.12.                          CANCELLATION.

 

The Company at any time may deliver Securities to the Trustee for cancellation.  The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment.  The Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent and no one else, shall cancel all Securities surrendered for transfer, exchange, payment, replacement or cancellation and shall dispose of such canceled Securities (subject to the record retention requirement of the Exchange Act or other applicable law) in accordance with the Trustee’s customary practice.  The Company may not issue new Securities to replace Securities that it has paid or delivered to the Trustee for cancellation.

 

Section 2.13.                          DEFAULTED INTEREST.

 

If the Company and the Guarantors default in a payment of interest on a Series of Securities, the Company or any such Guarantor (to the extent of its obligations under its Subsidiary Guarantee) shall pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Securityholders of the Series at the close of business on a subsequent special record date, which date shall be at the earliest practicable date but in all events at least five Business Days prior to the payment date, in each case at the rate provided for with respect to the applicable Securities.

 

The Company shall notify the Trustee and the Paying Agent in writing of the amount of defaulted interest proposed to be paid on the Series and the date of the proposed payment, and at the same time the Company shall deposit with the paying agent an amount of money equal to the aggregate amount proposed to be paid in respect of such defaulted interest or shall make arrangements as are satisfactory to the Paying Agent for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such defaulted interest as provided in this Section 2.12. The Company shall fix or cause to be fixed each such special record date and payment date, and shall, promptly thereafter, notify the Trustee and the Paying Agent of any such date. At least 15 days before the special record date, the Company (or the Depository in the name of and at the expense of the Company) shall deliver to Securityholders of the Series a notice that states the special record date, the related payment date and the amount of such interest to be paid. The Company and the Guarantors may pay defaulted interest in any other lawful manner.

 

Section 2.14.                          RECORD DATE.

 

The record date for purposes of determining the identity of Securityholders of the Series entitled to vote or consent to any action by vote or consent authorized or permitted under this Indenture shall be determined as provided for in TIA Section 316(c). The Trustee shall not have any responsibility for determining the record date for any such action by vote or consent by the Securityholders of the Series.  The record date for purposes of determining the identity of Securityholders of a Series entitled to payments of interest shall be set forth in the applicable Board Resolution, supplemental indenture or Officers’ Certificate.

 

Section 2.15.                          GLOBAL SECURITIES.

 

Section 2.15.1                   Terms of Securities.  A Board Resolution, a supplemental indenture hereto or an Officers’ Certificate shall establish whether the Securities of a Series shall be issued in whole or in part in the form of one or more Global Securities and the Depository for such Global Security or Securities.

 

Section 2.15.2                   Transfer and Exchange.  Notwithstanding any provisions to the contrary contained in Section 2.7 of the Indenture and in addition thereto, and except as otherwise set forth in a supplemental indenture with regard to a Series of Securities, any Global Security shall be exchangeable pursuant to Section 2.7 of the Indenture for Securities registered in the names of Holders other than the Depository for such Security or its nominee only if (i) such Depository notifies the Company that it is unwilling or unable to continue as Depository for

 

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such Global Security or if at any time such Depository ceases to be a clearing agency registered under the Exchange Act, and, in either case, the Company fails to appoint a successor Depository within 90 days of such event, (ii) the Company executes and delivers to the Trustee an Officers’ Certificate to the effect that such Global Security shall be so exchangeable or (iii) an Event of Default with respect to the Securities represented by such Global Security shall have occurred and be continuing.  Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Securities registered in such names as the Depository shall direct in writing in an aggregate principal amount equal to the principal amount of the Global Security with like tenor and terms.

 

Except as provided in this Section 2.15.2 or as may be set forth in a supplemental indenture with regard to a Series of Securities, a Global Security may not be transferred except as a whole by the Depository with respect to such Global Security to a nominee of such Depository, by a nominee of such Depository to such Depository or another nominee of such Depository or by the Depository or any such nominee to a successor Depository or a nominee of such a successor Depository.

 

Section 2.15.3                   Legend.  Any Global Security issued hereunder shall bear a legend in substantially the following form:

 

“This Security is a Global Security within the meaning of the Indenture hereinafter referred to and is registered in the name of the Depository or a nominee of the Depository.  This Security is exchangeable for Securities registered in the name of a Person other than the Depository or its nominee only in the limited circumstances described in the Indenture, and may not be transferred except as a whole by the Depository to a nominee of the Depository, by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor Depository or a nominee of such a successor Depository.”

 

Section 2.15.4                   Acts of Holders.  The Depository, as a Holder, may appoint agents and otherwise authorize participants to give or take any request, demand, authorization, direction, notice, consent, waiver or other action which a Holder is entitled to give or take under the Indenture.

 

Section 2.15.5                   Payments.  Notwithstanding the other provisions of this Indenture, unless otherwise specified as contemplated by Section 2.2, payment of the principal of and interest, if any, on any Global Security shall be made to the Holder thereof.

 

Section 2.15.6                   Consents, Declaration and Directions.  Except as provided in Section 2.15.5, the Company, the Trustee and any Agent shall treat the Holder of such principal amount of outstanding Securities of such Series represented by a Global Security as the owner thereof, as shall be specified in a written statement of the Depository with respect to such Global Security, for purposes of obtaining any consents, declarations, waivers or directions required to be given by the Holders pursuant to this Indenture.

 

Section 2.16.                          CUSIP NUMBERS.

 

The Company in issuing the Securities may use a “CUSIP” number and an “ISIN” number, and if so, such CUSIP number and ISIN number shall be included in notices of redemption or purchase as a convenience to Securityholders; provided, however, that any such notice may state that no representation is made as to the correctness or accuracy of the CUSIP number and ISIN number printed in the notice or on the Securities, and that reliance may be placed only on the other identification numbers printed on the Securities.  The Company shall promptly notify the Trustee and each Paying Agent of any change in the CUSIP number and ISIN number.

 

ARTICLE III.
 REDEMPTION

 

Section 3.1.                                 NOTICE TO TRUSTEE.

 

The Company may, with respect to any Series of Securities, reserve the right to redeem and pay the Series of Securities or may covenant to redeem and pay the Series of Securities or any part thereof prior to the Stated Maturity thereof at such time and on such terms as provided for in such Securities.  If a Series of Securities is

 

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redeemable and the Company wants or is obligated to redeem prior to the Stated Maturity thereof all or part of the Series of Securities pursuant to the terms of such Securities, it shall provide notice to the Trustee of the redemption date and the principal amount of Series of Securities to be redeemed.  The Company shall give the notice to the Trustee at least 45 days before the redemption date (or such shorter notice as may be acceptable to the Trustee), which notice shall be in the form of an Officers’ Certificate setting forth (i) the Section of this Indenture pursuant to which the redemption shall occur, (ii) the redemption date, (iii) the principal amount of Securities of a Series to be redeemed and (iv) the redemption price.

 

Section 3.2.                                 SELECTION OF SECURITIES TO BE REDEEMED.

 

If less than all of any Series of Securities are to be redeemed at any time, the Trustee (or the Registrar, as applicable) shall select the Securities of the Series to be redeemed among the applicable Holders on a pro rata or by lot basis (or, in the case of any Series of Securities issued in global form as discussed in Section 2.15, based on a method that most nearly approximates a pro rata selection as the Trustee deems fair and appropriate in accordance with Depository guidelines) unless otherwise required by law or applicable stock exchange or depositary requirements, provided that no Securities of $2,000 or less shall be redeemed in part. In the event of partial redemption by lot, the particular Securities to be redeemed shall be selected, unless otherwise provided herein, not less than 10 nor more than 60 days prior to the redemption date by the Trustee from the outstanding Securities not previously called for redemption.

 

The Trustee shall promptly notify the Company and the Paying Agent in writing of the Securities of the Series selected for redemption and, in the case of any Security selected for partial redemption, the principal amount thereof to be redeemed.  Securities and portions of Securities selected shall be in amounts of $2,000 or whole multiples of $1,000 to the extent above $2,000; except that if all of the Securities of a Holder are to be redeemed, the entire outstanding amount of Securities held by such Holder, even if not a multiple of $1,000, shall be redeemed.  Except as provided in the preceding sentence, provisions of this Indenture that apply to Securities of a Series called for redemption also apply to portions of Securities of that Series called for redemption. Any such redemption or notice may, at the Company’s discretion, be subject to one or more conditions precedent, and if so conditioned, the redemption date for such Securities may be extended by the Company pending achievement of such condition precedent.

 

Section 3.3.                                 NOTICE OF REDEMPTION.

 

Unless otherwise indicated for a particular Series by Board Resolution, a supplemental indenture hereto or an Officers’ Certificate, at least 10 days but not more than 60 days before a redemption date, the Company shall deliver or cause to be delivered by first-class mail delivered by first class mail (or delivered electronically in accordance with the procedures of the Depository) a notice of redemption to each Holder whose Securities are to be redeemed and if any Bearer Securities are outstanding, publish on one occasion a notice in an Authorized Newspaper.

 

The notice shall identify the Securities of the Series to be redeemed (including the CUSIP number and ISIN number, if any) and shall state:

 

(a)                                 the redemption date;

 

(b)                                 the redemption price (including accrued interest to, but excluding, the applicable redemption date);

 

(c)                                  if any Security of the Series called for redemption is being redeemed in part only, the portion of the principal amount of such Security to be redeemed and that, after the redemption date upon surrender of such Security, a new Security or Securities in a principal amount equal to the unredeemed portion thereof shall be issued in the name of the Securityholder thereof upon cancellation of the original Security;

 

(d)                                 to the extent any Securities are held as definitive Securities, the name and address of the Paying Agent to which the Notes are to be surrendered for redemption;

 

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(e)                                  that Securities of the Series called for redemption must be surrendered to the Paying Agent to collect the redemption price;

 

(f)                                   that, unless the Company defaults in the making of such redemption payment, interest on Securities of the Series called for redemption ceases to accrue on and after the redemption date;

 

(g)                                  any conditions to such redemption; and

 

(h)                                 any other information as may be required by the terms of the particular Series or the Securities of a Series being redeemed.

 

At the Company’s request, the Trustee, in cooperation with the Depository, shall give the notice of redemption to the Securityholders in the Company’s name and at its expense; provided that the Company gives the Trustee written notice of such request at least 10 days prior to the date of the giving of such notice (or such shorter notice as may be acceptable to the Trustee).

 

Section 3.4.                                 EFFECT OF NOTICE OF REDEMPTION.

 

Once notice of redemption is delivered as provided in Section 3.3, Securities of a Series called for redemption become due and payable on the redemption date and at the redemption price.  On and after the redemption date, unless the Company defaults in the payment of the redemption price, interest will cease to accrue on the Securities of a Series called for called for redemption and all rights of Holders with respect to such Securities will terminate except for the right to receive payment of the redemption price upon surrender for redemption.  Upon surrender to the Paying Agent, such Securities shall be paid at the redemption price plus accrued interest to but excluding the redemption date.

 

A notice of redemption may, at the Company’s discretion, be subject to one or more conditions precedent, including completion of an offering of Capital Stock or another corporate transaction.  If the Company becomes aware that any condition precedent provided for in the notice of redemption delivered pursuant to Section 3.3 will not be satisfied on the redemption date specified in such notice, the Company shall notify the Trustee in writing prior to the close of business two (2) Business Days prior to such redemption date (or such shorter period as may be reasonably acceptable to the Trustee) and direct the Trustee to deliver such notice to the Securityholders. Upon receipt of such notice by the Securityholders, the notice of redemption shall be rescinded or delayed, and the redemption of the Securities shall be rescinded or delayed as provided in such notice.

 

Section 3.5.                                 DEPOSIT OF REDEMPTION PRICE.

 

Prior to 11:00 a.m. (New York City time) on the redemption date, the Company shall deposit with the Paying Agent money sufficient to pay the redemption price of and accrued interest, if any, on all Securities to be redeemed on that date.  If the Company complies with the provisions of the preceding sentence, on and after the redemption date, interest shall cease to accrue on the Securities or the portions of Securities called for redemption, whether or not such Securities are presented for payment.  If any Security called for redemption shall not be so paid upon surrender for redemption because of the failure of the Company to comply with the first sentence of this paragraph, interest shall be paid on the unpaid principal, from the redemption date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided with respect to such Security.

 

Section 3.6.                                 SECURITIES REDEEMED IN PART.

 

Upon surrender of a Security that is redeemed in part, the Trustee or an authenticating agent shall authenticate for the Holder a new Security of the same Series and the same maturity equal in principal amount to the unredeemed portion of the Security surrendered.

 

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ARTICLE IV.
 COVENANTS

 

Section 4.1.                                 PAYMENT OF PRINCIPAL AND INTEREST.

 

The Company covenants and agrees for the benefit of the Holders of each Series of Securities that it will duly and punctually pay the principal of and interest, if any, on the Securities of that Series in accordance with the terms of such Securities and this Indenture.

 

Section 4.2.                                 REPORTS.

 

Whether or not required by the rules and regulations of the SEC, so long as any Securities are outstanding, the Company will furnish to the Securityholders (or file with the SEC for public availability), within the time periods specified in the SEC’s rules and regulations:

 

(a)                                 all quarterly and annual financial information that would be required to be contained in a filing with the SEC on Forms 10-Q and 10-K if the Company were required to file such Forms, including a “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and, with respect to the annual information only, a report thereon by the Company’s certified independent accountants; and

 

(b)                                 all financial information that would be required to be included in a Form 8-K filed with the SEC if the Company were required to file such reports.

 

The Trustee shall have no liability or responsibility for the filing, timeliness or content of any such reports, documents or information filed by the Company and delivery of such reports, documents or information to the Trustee is for informational purposes only and receipt of such shall not constitute constructive notice thereof or any information contained therein.

 

In addition, whether or not required by the rules and regulations of the SEC, the Company will file a copy of all such information and reports with the SEC for public availability (unless the SEC will not accept such a filing) and make such information available to investors who request it in writing.  The Company shall otherwise comply with Section 314(a) of the TIA.  The Company will not take any action for the purpose of causing the SEC not to accept any such filings.  If, notwithstanding the foregoing, the SEC will not accept the Company’s filings for any reason, the Company will post the reports referred to in the preceding paragraphs on its website within the time periods that would apply if the Company were required to file those reports with the SEC. The Trustee shall have no liability or responsibility for the filing, content or timeliness of any such report.

 

Notwithstanding the foregoing, if at any time the Securities are guaranteed by any direct or indirect parent company of the Company, the Company shall satisfy its obligations under this covenant with respect to financial information relating to the Company by furnishing financial information relating to such direct or indirect parent company; provided, however, that the same is accompanied by consolidating information that explains in reasonable detail the differences between the information relating to such direct or indirect parent company and any of its Subsidiaries other than the Company and its Subsidiaries, on the one hand, and the information relating to the Company, the Guarantors and the other Subsidiaries of the Company on a standalone basis, on the other hand.

 

Section 4.3.                                 COMPLIANCE CERTIFICATE.

 

The Company shall deliver to the Trustee, within 90 days after the end of each fiscal year of the Company, an Officers’ Certificate complying with TIA Section 314(a)(4) stating that a review of the activities of the Company and its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Company and its Subsidiaries have kept, observed, performed and fulfilled their obligations under this Indenture, and further stating, as to each such Officer signing such certificate, that to the best of his knowledge the Company and its Subsidiaries have kept, observed, performed and fulfilled each and every covenant contained in this Indenture and are not in default in the performance or observance of any of the terms, provisions and conditions hereof (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he may have knowledge).

 

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The Company will, so long as any of the Securities are outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware of any Default or Event of Default, an Officers’ Certificate specifying such Default or Event of Default and what action the Company is taking or proposes to take with respect thereto.

 

Section 4.4.                                 STAY, EXTENSION AND USURY LAWS.

 

Each of the Company and the Guarantors covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture or the Securities; and each of the Company and the Guarantors (to the extent it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted.

 

Section 4.5.                                 CORPORATE EXISTENCE.

 

Subject to Article V and any covenants included in this Indenture or in a supplemental indenture relating to the release of Guarantors or the consolidation, merger or amalgamation of Restricted Subsidiaries, the Company and each of the Restricted Subsidiaries shall do or cause to be done all things necessary to preserve and keep in full force and effect (i) its existence in accordance with the respective organizational documents (as the same may be amended from time to time), and (ii) the rights (charter and statutory), licenses and franchises of the Company and the Restricted Subsidiaries; provided, however, that the Company and the Restricted Subsidiaries shall not be required to preserve any such right, license or franchise if an Officer of the Company shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company, the Restricted Subsidiaries and their Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any material respect to the Holders.

 

Section 4.6.                                 TAXES.

 

The Company shall, and shall cause each of its Subsidiaries to, pay prior to delinquency all material taxes, assessments and governmental levies, except (i) as contested in good faith and by appropriate proceedings or (ii) the nonpayment of which would not materially adversely affect the business, condition (financial or otherwise), operations, performance or properties of the Company and its Subsidiaries, taken as a whole.

 

Section 4.7.                                 MAINTENANCE OF OFFICE OR AGENCY.

 

The Company shall maintain an office or agency (which may be an office of the Trustee or an affiliate of the Trustee, Registrar or co-registrar) where the Securities of any Series may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of such Securities and this Indenture may be served.  The Company 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 Company 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.

 

The Company may also from time to time designate one or more other offices or agencies where the Securities of any Series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency for such purposes.  The Company 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.

 

The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with Section 2.4.

 

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ARTICLE V.
 SUCCESSORS

 

Section 5.1.                                 MERGERS, CONSOLIDATIONS OR SALE OF ASSETS.

 

The Company may not consolidate or merge with or into (whether or not the Company is the surviving entity), 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 another Person unless:

 

(a)                                 either (i) the Company is the surviving entity or (ii) the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made is an entity organized or existing under the laws of the United States, any state thereof or the District of Columbia;

 

(b)                                 the Person formed by or surviving any such consolidation or merger (if other than the Company), or the Person to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made, assumes all the obligations of the Company under the Securities of a Series, the supplemental indentures applicable to such Series and the Indenture (pursuant to a supplemental indenture in a form satisfactory to the Trustee);

 

(c)                                  immediately after such transaction no Default or Event of Default exists; and

 

(d)                                 either (i) the Company or any Person formed by or surviving any such consolidation or merger, or to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made, will, at the time of such transaction and after giving pro forma effect thereto, be permitted to incur at least $1.00 of additional Indebtedness pursuant to the test set forth in the applicable supplemental indenture, if any, without regard to any enumerated exceptions or (ii) at the time of such sale, assignment, transfer, lease, conveyance or other disposition shall have been made and after giving pro forma effect thereto, the Leverage Ratio set forth in any applicable supplemental indenture would have been no higher than the Leverage Ratio immediately prior to such transaction.

 

This Section 5.1 will not apply to any sale, assignment, transfer, conveyance, lease or other disposition of assets between or among the Company and the Restricted Subsidiaries.  Clauses (c) and (d) of the first paragraph of this Section 5.1 will not apply to any consolidation or merger of the Company (i) with or into any Restricted Subsidiary for any purpose or (ii) with or into an Affiliate solely for the purpose of reincorporating the Company in another jurisdiction in the United States.

 

Section 5.2.                                 SUCCESSOR CORPORATION SUBSTITUTED.

 

Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company in accordance with Section 5.1, the successor entity formed by such consolidation or into or with which the Company is merged or to which such sale, lease, conveyance or other disposition is made (the “Successor Person”) shall succeed to, and be substituted for (so that from and after the date of such consolidation, merger, sale, lease, conveyance or other disposition, the provisions of this Indenture referring to the “Company” shall refer instead to the Successor Person and not to the Company), and may exercise every right and power of, the Company under this Indenture with the same effect as if such Successor Person has been named as the Company herein; provided, however, that the predecessor Company in the case of a sale, lease, conveyance or other disposition shall not be released from the obligation to pay the principal of and interest, if any, on the Securities, except in the case of a sale of all the Company’s assets that meets the requirements of Section 5.1.

 

ARTICLE VI.
 DEFAULTS AND REMEDIES

 

Section 6.1.                                 EVENTS OF DEFAULT.

 

“Event of Default,” wherever used herein with respect to Securities of any Series, means any one of the following events, unless in the establishing Board Resolution, supplemental indenture or Officers’ Certificate, it is provided that such Series shall not have the benefit of said Event of Default:

 

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(a)                                 default for 30 days in the payment when due of interest on any Security of that Series;

 

(b)                                 default in payment when due of the principal of or premium, if any, on any Security of that Series;

 

(c)                                  failure by the Company to comply with any “Change of Control” covenant included in a supplemental indenture with respect to any Security of that Series;

 

(d)                                 failure by the Company or any Guarantor for 60 days after written notice from the Trustee or Holders of not less than 25% of the aggregate principal amount of the Securities of that Series then outstanding to comply with any of its other agreements in the Indenture, any supplemental indenture relating to such Series, the Securities or the Subsidiary Guarantees (in order to be effective, such notice must be in writing, specify the Default, demand that it be remedied and state that the notice is a “Notice of Default”);

 

(e)                                  the failure to pay at final maturity (giving effect to any applicable grace periods and any extensions thereof) the stated principal amount of any Indebtedness of the Company or any Restricted Subsidiary, or the acceleration of the final stated maturity of any such Indebtedness (which acceleration is not rescinded, annulled or otherwise cured within 30 days of receipt by the Company or such Restricted Subsidiary of notice of any such acceleration) if the aggregate principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness in default for failure to pay principal at final stated maturity or which has been so accelerated (in each case with respect to which the 30-day period described above has passed), equals $200.0 million or more at any time;

 

(f)                                   a final judgment or final judgments for the payment of money are entered by a court or courts of competent jurisdiction against the Company or any Restricted Subsidiary and such judgments remain unpaid, undischarged or unstayed for a period of 60 days, provided that the aggregate of all such unpaid, undischarged or unstayed judgments exceeds $200.0 million;

 

(g)                                  the Company or any Restricted Subsidiary that is a Significant Subsidiary:

 

(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 all or substantially all of its property,

 

(iv)                              makes a general assignment for the benefit of its creditors, or

 

(v)                                 admits in writing that it generally is unable to pay its debts as the same become due; in each case, pursuant to or within the meaning of any Bankruptcy Law; or

 

(h)                                 a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

 

(i)                                     is for relief against the Company or any Restricted Subsidiary that is a Significant Subsidiary in an involuntary case,

 

(ii)                                  appoints a Custodian of the Company or any Restricted Subsidiary that is a Significant Subsidiary or for all or substantially all of its property, or

 

(iii)                               orders the liquidation of the Company or any Restricted Subsidiary that is a Significant Subsidiary, and such order or decree remains unstayed and in effect for 60 days; or

 

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(i)                                     except as permitted by the Indenture, any supplemental indenture relating to such Series or the Subsidiary Guarantees, any Subsidiary Guarantee shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect, or the Company or any Restricted Subsidiary or any Person acting on behalf of the Company or any Restricted Subsidiary shall deny or disaffirm in writing its obligations under its Subsidiary Guarantee; or

 

(j)                                    any other Event of Default provided with respect to Securities of that Series, which is specified in a Board Resolution, a supplemental indenture hereto or an Officers’ Certificate, in accordance with Section 2.2.18.

 

The term “Bankruptcy Law” means Title 11, United States Bankruptcy Code of 1978, or any similar U.S. federal or state law relating to bankruptcy, insolvency, receivership, winding-up, liquidation, reorganization or relief of debtors or any amendment to, succession to or change in any such law.  The term “Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

 

Section 6.2.                                 ACCELERATION OF MATURITY.

 

In the case of an Event of Default under Section 6.1(g) or (h) with respect to the Company, any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, all outstanding Securities of such Series will become due and payable immediately without further action or notice.  If any other Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the then outstanding Securities of a Series may declare all the Securities of such Series to be due and payable immediately.

 

Section 6.3.                                 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.

 

The Company covenants that if

 

(a)                                 default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days, or

 

(b)                                 default is made in the payment of principal of any Security at the Maturity thereof, or

 

(c)                                  default is made in the deposit of any sinking fund payment when and as due by the terms of a Security,

 

THEN, the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal and interest and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal or any overdue interest, at the rate or rates prescribed therefor in such Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

 

If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or deemed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.

 

If an Event of Default with respect to any Securities of any Series occurs and is continuing, the Trustee may proceed to protect and enforce its rights and the rights of the Holders of Securities of such Series by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.

 

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Section 6.4.                                 TRUSTEE MAY FILE PROOFS OF CLAIM.

 

In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or of such other obligor or their creditors, but excluding any solvent reorganization or arrangement of capital pursuant to applicable corporations legislation, the Trustee (irrespective of whether the principal of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of overdue principal or interest) shall be entitled and empowered, by intervention in such proceeding or otherwise,

 

(a)                                 to file and prove a claim for the whole amount of principal and interest owing and unpaid in respect of the Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding,

 

(b)                                 to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same, and

 

(c)                                  any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such 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 counsel, and any other amounts due the Trustee hereunder.

 

Nothing herein contained 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 6.5.                                 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF SECURITIES.

 

All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.

 

Section 6.6.                                 APPLICATION OF MONEY COLLECTED.

 

Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal or interest, upon presentation of the Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

 

First: To the payment of all amounts due the Trustee (acting in any capacity hereunder);

 

Second: To the payment of the amounts then due and unpaid for principal of and interest on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and interest, respectively; and

 

Third: To the Company.

 

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Section 6.7.                                 LIMITATION ON SUITS.

 

Except to enforce the right to receive payment of principal, premium, if any, or interest, if any, when due, no Holder of any Security of any Series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless:

 

(a)                                 such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of that Series;

 

(b)                                 the Holders of at least 25% in aggregate principal amount of the then outstanding Securities of that Series shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder;

 

(c)                                  such Holder or Holders offer and, if requested, provide to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request;

 

(d)                                 the Trustee does not comply with such request within 60 days after its receipt of such request and offer of security or indemnity; and

 

(e)                                  during such 60-day period, Holders of a majority in aggregate principal amount of the then outstanding Securities of that Series do not give the Trustee a direction inconsistent with such written request;

 

it being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all such Holders.

 

Section 6.8.                                 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL AND INTEREST.

 

Subject to Article XIII hereof, notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of and premium and interest, if any, on such Security on the Stated Maturity or Stated Maturities expressed in such Security (or, in the case of redemption, on the redemption date) and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.

 

Section 6.9.                                 RESTORATION OF RIGHTS AND REMEDIES.

 

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Guarantors, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

 

Section 6.10.                          RIGHTS AND REMEDIES CUMULATIVE.

 

Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in Section 2.8, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

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Section 6.11.                          DELAY OR OMISSION NOT WAIVER.

 

No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.  Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

 

Section 6.12.                          CONTROL BY HOLDERS.

 

The Holders of a majority in principal amount of the outstanding Securities of any Series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Securities of such Series, provided that:

 

(a)                                 such direction shall not be in conflict with any rule of law or with this Indenture,

 

(b)                                 the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction, and

 

(c)                                  subject to the provisions of Section 6.1, the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith shall determine that the proceeding so directed would reasonably be expected to expose the Trustee to personal liability.

 

Section 6.13.                          WAIVER OF PAST DEFAULTS.

 

The holders of a majority in aggregate principal amount of the then outstanding Securities of any Series by written notice to the Trustee may, on behalf of the Holders of all of the Securities of such Series, rescind an acceleration or waive any existing Default or Event of Default and its consequences under this Indenture, if the rescission would not conflict with any judgment or decree, except a continuing Default or Event of Default in the payment of principal of, premium on, if any, or interest on, the Securities of such Series.  Upon any such waiver, 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 Event of Default or impair any right consequent thereon.

 

Section 6.14.                          UNDERTAKING FOR COSTS.

 

All parties to this Indenture agree, and each Holder of any Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, 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, suffered or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the outstanding Securities of any Series, or to any suit instituted by any Holder for the enforcement of the payment of the principal of or interest on any Security on or after the Stated Maturity or Stated Maturities expressed in such Security (or, in the case of redemption, on the redemption date).

 

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ARTICLE VII.
 TRUSTEE

 

Section 7.1.                                 DUTIES OF TRUSTEE.

 

(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 need perform only those duties that are specifically set forth in this Indenture and no others; 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 Officers’ Certificates or Opinions of Counsel furnished to the Trustee and conforming to the requirements of this Indenture; however, in the case of any such Officers’ Certificates or Opinions of Counsel which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine such Officers’ Certificates and Opinions of Counsel to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

 

(c)                                  The Trustee may not 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;

 

(ii)                                  The Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts;

 

(iii)                               The Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it with respect to Securities of any Series in good faith in accordance with the direction of the Holders of a majority in principal amount of the outstanding Securities of such Series relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities of such Series;

 

(d)                                 Every provision of this Indenture that in any way relates to the Trustee is subject to paragraph (a), (b) and (c) of this Section;

 

(e)                                  The Trustee may refuse to perform any duty or exercise any right or power unless it receives indemnity satisfactory to it against any cost, liability or expense;

 

(f)                                   The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company.  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law;

 

(g)                                  No provision of this Indenture shall require the Trustee to risk its own funds or otherwise incur any financial liability in the performance of any of its duties, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk is not reasonably assured to it; and

 

(h)                                 No bond or surety shall be required with respect to performance of the Trustee’s duties and powers.

 

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Section 7.2.                                 RIGHTS OF TRUSTEE.

 

(a)                                 The Trustee may conclusively rely on and shall be protected in acting or refraining from acting upon any document believed by it to be genuine and to have been signed or presented by the proper Person.  The Trustee need not investigate any fact or matter stated in the document.

 

(b)                                 Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an Opinion of Counsel.  The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or Opinion of Counsel.

 

(c)                                  The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.  No Depository shall be deemed an agent of the Trustee and the Trustee shall not be responsible for any act or omission by any Depository. The Trustee shall also have no liability or responsibility for the action or inaction of the Depository.

 

(d)                                 The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers.

 

(e)                                  The Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.

 

(f)                                   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 of Securities unless such Holders shall have offered to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

 

(g)                                  The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.

 

(h)                                 The Trustee shall not be deemed to have notice of any Default or Event of Default (other than a payment default under Sections 6.1(a) or 6.1(b)) unless a Responsible Officer of the Trustee has received written notice of any event which is in fact such a default in accordance with Section 11.2.

 

(i)                                     The Trustee may request that the Company deliver an Officers’ Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers’ Certificate may be signed by any Person authorized to sign an Officers’ Certificate, including any Person specified as so authorized in any such certificate previously delivered and not superseded.

 

(j)                                    In no event shall the Trustee be responsible or liable for special, punitive, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.

 

(k)                                 For certain payments made pursuant to this Indenture, the paying agent may be required to make a “reportable payment” or “withholdable payment” with respect to a Series of Securities and in such cases the Paying Agent may have the duty to act as a payor or withholding agent, respectively, that is responsible for any tax withholding and reporting required under Chapters 3, 4, 24 and 61 of the Code.  The Paying Agent shall have the sole right to make the determination as to which payments with respect to which it is the withholding agent are “reportable payments” or “withholdable payments” under the Code.  All parties to this Indenture shall provide an executed IRS Form W-9 or appropriate IRS Form W-8 (or, in each case, any successor form) to the Paying Agent prior to closing of any Series of Securities, and shall promptly update any such form to the extent such form becomes obsolete or inaccurate in any respect.  The Paying Agent shall have the right to request from any party to

 

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this Indenture, or any other Person entitled to payment hereunder or under any supplemental indenture, any additional forms, documentation or other information as may be reasonably necessary for the Paying Agent to satisfy its reporting and withholding obligations under the Code.  To the extent any such forms to be delivered under this Section 7.2(k) are not provided prior to or by the time the related payment is required to be made or are determined by the Paying Agent to be incomplete and/or inaccurate in any respect, the paying agent shall be entitled to withhold on any such payments hereunder to the extent withholding is required under Chapters 3, 4, 24 or 61 of the Code, and shall have no obligation to gross up any such payment

 

Section 7.3.                                 INDIVIDUAL RIGHTS OF TRUSTEE.

 

The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or an Affiliate with the same rights it would have if it were not Trustee.  However, in the event that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days or resign.  Any Agent may do the same with like rights.  The Trustee is also subject to Sections 7.10 and 7.11.  Under no circumstances shall the Trustee be liable in its individual capacity for the obligations evidenced by the Notes.

 

Section 7.4.                                 TRUSTEE’S DISCLAIMER.

 

The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, it shall not be accountable for the Company’s use of the proceeds from the Securities, and it shall not be responsible for any statement in the Securities other than its authentication.

 

Section 7.5.                                 NOTICE OF DEFAULTS.

 

If a Default or Event of Default occurs and is continuing with respect to the Securities of any Series and if it is actually known to a Responsible Officer of the Trustee as described in Section 7.2(h), the Trustee shall mail to each Securityholder of the Securities of that Series and, if any Bearer Securities are outstanding, publish on one occasion in an Authorized Newspaper, notice of a Default or Event of Default within 90 days after it occurs or, if later, after a Responsible Officer of the Trustee has actual knowledge of such Default or Event of Default.  The Trustee may withhold the notice if and so long as it in good faith determines that withholding the notice is in the interests of Securityholders of that Series, except a Default or Event of Default relating to the payment of principal of, premium on, if any, and interest.

 

Section 7.6.                                 REPORTS BY TRUSTEE TO HOLDERS.

 

Within 60 days after May 15 in each year, the Trustee shall transmit by mail to all Securityholders, as their names and addresses appear on the register kept by the Registrar and, if any Bearer Securities are outstanding, publish in an Authorized Newspaper, a brief report dated as of such May 15, in accordance with, and to the extent required under, TIA Section 313.

 

A copy of each report at the time of its mailing to Securityholders of any Series shall be filed with any stock exchange on which the Securities of that Series are listed (and, if the Securities of such Series are not listed, with the SEC).  The Company shall promptly notify the Trustee when Securities of any Series are listed on any stock exchange or any delisting thereof.

 

Section 7.7.                                 COMPENSATION AND INDEMNITY.

 

The Company shall pay to the Trustee (acting in any capacity hereunder) from time to time such compensation for its services as the Company and the Trustee shall agree in writing.  The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust.  The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred by it.  Such expenses shall include the reasonable compensation and expenses of the Trustee’s agents and counsel.

 

The Company shall fully indemnify the Trustee (acting in any capacity hereunder) or any predecessor Trustee and their agents (including the cost of defending itself against any claim (whether asserted by the Company,

 

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or any Holder or any other Person)) against any and all losses, damages, claims, liability, fees, costs or expenses, including taxes (other than taxes based upon, measured by or determined by the income of the Trustee) incurred by it except as set forth in the next paragraph in the performance of their duties under this Indenture as Trustee or Agent, including, without limitation, reasonable attorneys’ fees and expenses and court costs incurred in connection with any action, claim or suit brought to enforce the Trustee’s right to compensation, reimbursement or indemnification.  The Trustee shall notify the Company promptly of any claim of which a Responsible Officer has received notice for which it may seek indemnity.  The Company shall defend the claim and the Trustee shall cooperate in the defense.  The Trustee may have separate counsel and the Company shall pay the reasonable fees and expenses of such counsel.  The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld.  This indemnification shall apply to officers, directors, employees, shareholders and agents of the Trustee and any Agent.

 

The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee or by any officer, director or employee of the Trustee caused by its own negligence or willful misconduct as determined by a court of competent jurisdiction in a final, non-appealable order.

 

To secure the Company’s payment obligations in this Section, the Trustee shall have a lien prior to the Securities of any Series on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular Securities of that Series.

 

When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.1(g) or (h) (or any comparable provisions set forth in a supplemental indenture) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law.

 

The Trustee shall comply with the provisions of TIA Section 313(b)(2) to the extent applicable.

 

The provisions of this Section shall survive the termination of this Indenture and the resignation or removal of the Trustee.

 

Section 7.8.                                 REPLACEMENT OF TRUSTEE.

 

A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section.

 

The Trustee may resign with respect to the Securities of one or more Series by so notifying the Company in writing.  The Holders of a majority in principal amount of the Securities of any Series may remove the Trustee with respect to that Series by so notifying the Trustee and the Company in writing not less than 30 days prior to the effective date of such removal.

 

The Company may remove the Trustee with respect to Securities of one or more Series if:

 

(a)                                 the Trustee fails to comply with Section 7.10;

 

(b)                                 the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;

 

(c)                                  a Custodian or public officer takes charge of the Trustee or its property; or

 

(d)                                 the Trustee becomes incapable of acting.

 

If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee.  Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Securities may appoint a successor Trustee to replace the successor Trustee appointed by the Company.

 

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If a successor Trustee with respect to the Securities of any one or more Series does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least 10% in principal amount of the Securities of the applicable Series may petition any court of competent jurisdiction at the expense of the Company for the appointment of a successor Trustee.

 

If the Trustee with respect to the Securities of any one or more Series fails to comply with Section 7.10, any Securityholder of the applicable Series, who has been a Securityholder for at least six months, may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

 

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company.  Promptly after that, the retiring Trustee shall, upon payment of its charges hereunder, transfer all property held by it as Trustee to the successor Trustee subject to the lien provided for in Section 7.7, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee with respect to each Series of Securities for which it is acting as Trustee under this Indenture.  A successor Trustee shall mail a notice of its succession to each Securityholder of each such Series and, if any Bearer Securities are outstanding, publish such notice on one occasion in an Authorized Newspaper.

 

Notwithstanding replacement of the Trustee pursuant to this Section 7.8, the Company’s obligations under Section 7.7 hereof shall continue for the benefit of the retiring trustee with respect to expenses and liabilities incurred by it prior to such replacement.

 

Any resigning or removed Trustee shall have no responsibility or liability for any action or inaction of any successor Trustee.

 

Section 7.9.                                 SUCCESSOR TRUSTEE BY MERGER, ETC.

 

If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act shall be the successor Trustee.

 

Section 7.10.                          ELIGIBILITY; DISQUALIFICATION.

 

This Indenture shall always have a Trustee who satisfies the requirements of TIA Section 310(a)(1), (2) and (5).  The Trustee shall always have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition.  The Trustee shall comply with TIA Section 310(b).

 

Section 7.11.                          PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

 

The Trustee is subject to TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b).  A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated.

 

Section 7.12.                          AGENTS.

 

The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be compensated, reimbursed (including for any applicable value added tax) and indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and to each Agent and shall be enforceable by each Agent.  For avoidance of doubt, the provisions of this Article VII (other than Section 7.1(a)) shall be applicable to all Agents whether or not such Agent is an affiliate of the Trustee.

 

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ARTICLE VIII.
 LEGAL DEFEASANCE AND COVENANT DEFEASANCE

 

Section 8.1.                                 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.

 

The Company may, at the option of its Board of Directors evidenced by a resolution set forth in an Officers’ Certificate, at any time, elect to have either Section 8.2 or 8.3 be applied to all of its obligations discharged with respect to outstanding Securities of a Series upon compliance with the conditions set forth below in this Article VIII.

 

Section 8.2.                                 LEGAL DEFEASANCE AND DISCHARGE.

 

Upon the Company’s exercise under Section 8.1 of the option applicable to this Section 8.2, each of the Company and the Guarantors, if any, shall, subject to the satisfaction of the conditions set forth in Section 8.4, be deemed to have been discharged from its obligations with respect to all outstanding Securities of such Series and related Subsidiary Guarantees on the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”).  For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Securities of such Series, which shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.5 and the other Sections of this Indenture referred to in (a) and (b) below, and to have satisfied all its other obligations under such Securities and this Indenture as it relates to such Securities (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Securities of such Series to receive solely from the trust fund described in Section 8.4, and as more fully set forth in such section, payments in respect of the principal of, premium, if any, and interest on such Securities when such payments are due, (b) the Company’s and Guarantors’ obligations with respect to such Securities under Article II, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Company’s and the Guarantors’ obligations in connection therewith and (d) this Article VIII.  Subject to compliance with this Article VIII, the Company may exercise its option under this Section 8.2 notwithstanding the prior exercise of its option under Section 8.3.

 

Section 8.3.                                 COVENANT DEFEASANCE.

 

Upon the Company’s exercise under Section 8.1 of the option applicable to this Section 8.3, each of the Company and the Guarantors, if any, shall, subject to the satisfaction of the conditions set forth in Section 8.4, be released from its obligations under the covenants specified pursuant to Section 2.2 and Article V with respect to the outstanding Securities of such Series and related Subsidiary Guarantees on and after the date the conditions set forth below are satisfied (hereinafter, “Covenant Defeasance”), and such Securities shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Securities shall not be deemed outstanding for accounting purposes).  For this purpose, Covenant Defeasance means that, with respect to the outstanding Securities of such Series, the Company and the Guarantors may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.1, but, except as specified above, the remainder of this Indenture, such Securities and the related Subsidiary Guarantees, if any, shall be unaffected thereby.  In addition, upon the Company’s exercise under Section 8.1 of the option applicable to this Section 8.3 hereof, subject to the satisfaction of the conditions set forth in Section 8.4, Sections 6.1(c) through 6.1(f) and 6.1(i) (or any comparable provisions set forth in a supplemental indenture) shall not constitute Events of Default.

 

Section 8.4.                                 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.

 

The following shall be the conditions to the application of either Section 8.2 or 8.3 hereof to the outstanding Securities of such Series:

 

In order to exercise either Legal Defeasance or Covenant Defeasance:

 

(a)                                 the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders, cash in Dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be

 

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sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, premium, if any, and interest on the outstanding Securities of such Series on the Stated Maturity or on the applicable redemption date, as the case may be, of such principal or installment of principal of, premium, if any, or interest on the outstanding Securities of such Series;

 

(b)                                 in the case of an election under Section 8.2, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that (A) the Company has received from, or there has been published by, the U.S. Internal Revenue Service a ruling or (B) since the date hereof, there has been a change in the applicable U.S. federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders and beneficial owners of the outstanding Securities of such Series will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

 

(c)                                  in the case of an election under Section 8.3, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States reasonably acceptable to the Trustee confirming that the Holders and beneficial owners of the outstanding Securities of such Series will not recognize income, gain or loss for U.S.federal income tax purposes as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;

 

(d)                                 no Default or Event of Default shall have occurred and be continuing (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit (and any similar concurrent deposit relating to other Indebtedness), and the granting of Liens to secure such borrowings) on the date of the deposit described in Section 8.4(a);

 

(e)                                  such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any material agreement or instrument (other than this Indenture, and any supplemental indenture hereunder, and the agreements governing any other Indebtedness being defeased, discharged or replaced) to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound;

 

(f)                                   the Company shall have delivered to the Trustee an Officers’ Certificate stating that the deposit was not made by the Company with the intent of preferring the Holders of such Securities over any other creditors of the Company with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others; and

 

(g)                                  the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.

 

Section 8.5.                                 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.

 

Subject to Section 8.6, all money and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.5, the “Trustee”) pursuant to Section 8.4 in respect of the outstanding Securities of a Series subject to a Legal Defeasance or a Covenant Defeasance shall be held in trust and applied by the Trustee, in accordance with the provisions of such Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of such Securities of all sums due and to become due thereon in respect of principal, premium, if any, and interest, but such money need not be segregated from other funds except to the extent required by law.

 

The Company and the Guarantors shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable Government Securities deposited pursuant to Section 8.4 or

 

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the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Securities of a Series subject to a Legal Defeasance or a Covenant Defeasance.

 

Anything in this Article VIII to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any money or non-callable Government Securities held by it as provided in Section 8.4 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.4(a)), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

 

Section 8.6.                                 REPAYMENT TO COMPANY.

 

Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or interest, if any, on any Securities of a Series subject to a Legal Defeasance or a Covenant Defeasance and remaining unclaimed for two years after such principal, and premium, if any, or interest, if any, have become due and payable, subject to applicable abandoned property law, shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease.

 

Section 8.7.                                 REINSTATEMENT.

 

If the Trustee or Paying Agent is unable to apply any Dollars or non-callable Government Securities in accordance with Section 8.2 or 8.3, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company’s obligations under this Indenture, the Securities of such Series and the related Subsidiary Guarantees, if any, shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.2 or 8.3 until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.2 or 8.3, as the case may be; provided, however, that, if the Company make any payment of principal of, premium, if any, or interest, if any, on any such Security following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money held by the Trustee or Paying Agent.

 

ARTICLE IX.
 AMENDMENTS AND WAIVERS

 

Section 9.1.                                 WITHOUT CONSENT OF HOLDERS.

 

Notwithstanding Section 9.2, without the consent of any Securityholder, the Company and the Trustee may amend or supplement the Indenture or the Securities:

 

(a)                                 to cure any ambiguity, defect or inconsistency,

 

(b)                                 to provide for uncertificated Securities in addition to or in place of certificated Securities (provided that the uncertificated Securities are issued in registered form for purposes of Section 163(f) of the Code),

 

(c)                                  to provide for the assumption of the Company’s or any Guarantor’s obligations to Holders of a Security in the case of a merger, consolidation or amalgamation,

 

(d)                                 to make any change that would provide any additional rights or benefits to the Holders of a Security (including providing for additional Subsidiary Guarantees) or that does not adversely affect the legal rights of any such Securityholder under this Indenture,

 

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(e)                                  to comply with requirements of the SEC in order to effect or maintain the qualification of the Indenture under the TIA, or

 

(f)                                   to conform the text of the Indenture or a supplemental indenture, the Securities of a Series or the Subsidiary Guarantees to any provision of a summary of the terms of the Indenture, a supplemental indenture for such Securities, such Securities or Subsidiary Guarantees to the extent included in a prospectus, prospectus supplement or other offering document in respect of the offering of such Securities and that such provision in such summary was intended to be a verbatim recitation of a provision of the applicable Indenture, supplemental indenture, the Securities of a Series or the Subsidiary Guarantees, which intent may be evidenced by an Officers’ Certificate delivered to the Trustee to that effect.

 

Upon the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental Indenture, and upon receipt by the Trustee of the documents described in Section 7.2, the Trustee shall join with the Company and the Guarantors in the execution of any amended or supplemental Indenture authorized or permitted by the terms of this Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to enter into such amended or supplemental Indenture that affects its own rights, duties or immunities under this Indenture or otherwise.

 

For the avoidance of doubt, no amendment to, or deletion of any of the covenants described in Article IV or a supplemental indenture or action taken in compliance with the covenants in effect at the time of such action, shall be deemed to impair or affect any rights of any Holders of the Securities of a Series to receive payment of principal of or premium, if any, or interest on such Securities or to institute suit for the enforcement of any payment on or with respect to such Holder’s Securities.

 

Section 9.2.                                 WITH CONSENT OF HOLDERS.

 

Except as provided in Section 9.1 and Section 9.3, the Indenture or the Securities of a Series may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the Securities of each Series then outstanding affected by the supplemental indenture implementing such amendment or supplement (including consents obtained in connection with a tender offer or exchange offer for Securities), and, subject to Sections 6.8 and 6.12, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium, if any, or interest on the Securities of such Series, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of this Indenture or the Securities of such Series may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Securities of each Series affected by such supplemental indenture implementing such amendment or supplement (including consents obtained in connection with a tender offer or exchange offer for Securities).

 

It shall not be necessary for the consent of the Holders of Securities under this Section 9.2 to approve the particular form of any proposed amendment or waiver, but it shall be sufficient if such consent approves the substance thereof.  After a supplemental indenture or waiver under this Section 9.2 becomes effective, the Company shall mail to the Holders of Securities affected thereby and, and if any Bearer Securities affected thereby are outstanding, publish on one occasion in an Authorized Newspaper, a notice briefly describing the supplemental indenture or waiver.  Any failure by the Company to mail or publish such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture or waiver.

 

Upon the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental Indenture, and upon the filing with the Trustee of evidence reasonably satisfactory to the Trustee of the consent of the Holders of Securities as aforesaid, and upon receipt by the Trustee of the documents described in Section 7.2, the Trustee shall join with the Company and the Guarantors in the execution of such amended or supplemental Indenture unless such amended or supplemental Indenture affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such amended or supplemental Indenture.

 

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Section 9.3.                                 LIMITATIONS.

 

Without the consent of each Securityholder affected, an amendment or waiver may not (with respect to any Securities held by a non-consenting Holder of Securities):

 

(a)                                 reduce the principal amount of Securities whose Holders must consent to an amendment, supplement or waiver;

 

(b)                                 reduce the principal of or change the fixed maturity of any Security or alter any of the provisions with respect to the redemption of any Security in a manner adverse to the Holders of such Security;

 

(c)                                  reduce the rate of or change the time for payment of interest on any Security;

 

(d)                                 waive a Default or Event of Default in the payment of principal of or premium, if any, or interest on any Security (except a rescission of acceleration of the Securities of any Series by the Holders of at least a majority in aggregate principal amount of the then outstanding Securities of such Series and a waiver of the payment default that resulted from such acceleration);

 

(e)                                  make any Security payable in a currency other than that stated in such Security;

 

(f)                                   make any change in the provisions of the Indenture relating to waivers of past Defaults or the legal rights of Holders of Securities of any Series to receive payments of principal of or premium, if any, or interest on the Securities;

 

(g)                                  waive a redemption payment with respect to any Security (other than a payment required by any “Change of Control” or “Asset Sale” covenant set forth in a supplemental indenture relating to Securities of a Series);

 

(h)                                 except pursuant to the Indenture, release any Guarantor from its obligations under its Subsidiary Guarantee, or change any Subsidiary Guarantee in any manner that would materially adversely affect the Securityholders; or

 

(i)                                     make any change in the foregoing amendment and waiver provisions.

 

It shall not be necessary for the consent of the Holders of Securities under this Section 9.3 to approve the particular form of any proposed amendment or waiver, but it shall be sufficient if such consent approves the substance thereof.

 

Section 9.4.                                 COMPLIANCE WITH TRUST INDENTURE ACT.

 

Every amendment to this Indenture or the Securities of one or more Series shall be set forth in a supplemental indenture hereto that complies with the TIA as then in effect.

 

Section 9.5.                                 REVOCATION AND EFFECT OF CONSENTS.

 

Until an amendment or waiver becomes effective, a consent to it by a Holder of a Security is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent is not made on any Security.

 

However, any such Holder or subsequent Holder may revoke the consent as to his Security or portion of a Security if the Trustee receives the notice of revocation before the date the amendment or waiver becomes effective.

 

Any amendment or waiver once effective shall bind every Securityholder of each Series affected by such amendment or waiver unless it is of the type described in any of clauses (a) through (h) of Section 9.3.  In that case, the amendment or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security.

 

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Section 9.6.                                 NOTATION ON OR EXCHANGE OF SECURITIES.

 

The Trustee may place an appropriate notation about an amendment or waiver on any Security of any Series thereafter authenticated.  The Company in exchange for Securities of that Series may issue and the Trustee shall authenticate upon request new Securities of that Series that reflect the amendment or waiver.

 

Section 9.7.                                 TRUSTEE TO SIGN AMENDMENTS; TRUSTEE PROTECTED.

 

The Trustee shall sign any amended or supplemental Indenture authorized pursuant to this Article IX if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee.  In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be provided with, and (subject to Section 7.1) shall be fully protected in conclusively relying upon, an Opinion of Counsel and Officers’ Certificate stating that the execution of such supplemental indenture is authorized or permitted by this Indenture, complying with the requirements of Sections 10.4 and 10.5, and covering such other matters as the Trustee may reasonably require, including that such supplemental indenture is the legal, valid and binding obligation of the Company and the Guarantors, enforceable against the Company and the Guarantors in accordance with its terms..

 

Promptly after the execution by the Company and the Trustee of any supplemental indenture pursuant to the provisions of this Section, the Trustee shall transmit a copy of such supplemental indenture or a notice provided by the Company to the Trustee setting forth in general terms the substance of such supplemental indenture, to the Securityholders of all series affected thereby.  In the case of certificated Securities, such notice shall be sent by mail, first class postage prepaid, to the Securityholders of all series affected thereby as their names and addresses appear upon the Security Register.  Any failure of the Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture.

 

ARTICLE X.
  SATISFACTION AND DISCHARGE

 

Section 10.1.                          SATISFACTION AND DISCHARGE.

 

This Indenture will be discharged and will cease to be of further effect as to all Securities of a Series, when:

 

(a)                                 either:

 

(i)                                     all Securities of such series that have been authenticated, except lost, stolen or destroyed Securities of such series that have been replaced or paid and Securities of such series for whose payment money has been deposited in trust and thereafter repaid to the Company, have been delivered to the Trustee for cancellation; or

 

(ii)                                  all Securities of such series that have not been delivered to the Trustee for cancellation have become due and payable by reason of the delivery of a notice of redemption or otherwise or will become due and payable within one year and the Company or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the Holders of such Securities, cash in Dollars, non-callable Government Securities, or a combination thereof, in amounts as will be sufficient, without consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the Securities of such series not delivered to the Trustee for cancellation for principal of, premium on, if any, and interest on, the Securities of such series to the date of maturity or redemption;

 

(b)                                 in respect of clause (a)(ii), no Default or Event of Default has occurred and is continuing on the date of the deposit (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit and any similar deposit relating to other Indebtedness and, in each case, the granting of Liens to secure such borrowings) and the deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company or any Guarantor is a party or by which the Company or any Guarantor

 

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is bound (other than with respect to the borrowing of funds to be applied concurrently to make the deposit required to effect such satisfaction and discharge and any similar concurrent deposit relating to other Indebtedness, and in each case the granting of Liens to secure such borrowings);

 

(c)                                  the Company or any Guarantor has paid or caused to be paid all sums payable by it under this Indenture;

 

(d)                                 the Company has delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the Securities of such series at maturity or on the redemption date, as the case may be; and

 

(e)                                  the Company has delivered an Officers’ Certificate and an Opinion of Counsel to the Trustee stating that all conditions precedent to the satisfaction and discharge of this Indenture have been satisfied.

 

ARTICLE XI.
 MISCELLANEOUS

 

Section 11.1.                          TRUST INDENTURE ACT CONTROLS.

 

If any provision of this Indenture limits, qualifies, or conflicts with another provision which is required or deemed to be included in this Indenture by the TIA, such required or deemed provision shall control.

 

Section 11.2.                          NOTICES.

 

Any notice or communication by the Company, any Guarantor or the Trustee to the others is duly given if in writing and delivered in Person or mailed by first class mail (registered or certified, return receipt requested), telecopier or overnight air courier guaranteeing next day delivery, to the others’ address:

 

If to the Company or any Guarantor:

 

Iron Mountain Incorporated
 One Federal Street
 Boston, Massachusetts 02110
 Telecopier No.: (617) 350-7881
 Attention: Chief Financial Officer

 

With a copy to:

 

Sullivan & Worcester LLP
 One Post Office Square
 Boston, Massachusetts 02109
 Telecopier No.: (617) 338-2880
 Attention: William J. Curry, Esq.

 

If to the Trustee:

 

Wells Fargo Bank, National Association
 150 East 42nd Street, 40th Floor
 New York, New York 10017
 Telecopier No.: (917) 260-1593
 Attention: Corporate Trust Services Administrator — Iron Mountain Incorporated

 

The Company, any Guarantor or the Trustee, by notice to the others may designate additional or different addresses for subsequent notices or communications.

 

35

 

All notices and communications (other than those sent to Securityholders) must reference the Securities and this Indenture and 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 receipt acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery.

 

Any notice or communication to a Securityholder shall be mailed by first class mail, or by overnight air courier guaranteeing next day delivery to its address shown on the register kept by the Registrar.  Any notice or communication shall also be so mailed to any Person described in TIA Section 313(c), to the extent required by the TIA.  Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders.

 

If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it.

 

If the Company or any Guarantor mails a notice or communication to Securityholders, it shall mail a copy to the Trustee and each Agent at the same time.

 

Section 11.3.                          COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.

 

Securityholders of any Series may communicate pursuant to TIA Section 312(b) with other Securityholders of that Series or any other Series with respect to their rights under this Indenture or the Securities of that Series or all Series.  The Company, the Guarantors, the Trustee, the Registrar and anyone else shall have the protection of TIA Section 312(c).

 

Section 11.4.                          CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

 

Upon any request or application by the Company or any Guarantor to the Trustee to take any action under this Indenture, the Company or such Guarantor shall furnish to the Trustee:

 

(a)                                 an Officers’ Certificate 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 stating that, in the opinion of such counsel, all such conditions precedent have been complied with.

 

Section 11.5.                          STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.

 

Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA Section 314(e) and shall include:

 

(a)                                 a statement that the Person 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 Person, 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

 

(d)                                 a statement as to whether or not, in the opinion of such Person, such condition or covenant has been complied with.

 

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Section 11.6.                          RULES BY TRUSTEE AND AGENTS.

 

The Trustee may make reasonable rules for action by or at a meeting of Securityholders of one or more Series.  Any Agent may make reasonable rules and set reasonable requirements for its functions.

 

Section 11.7.                          LEGAL HOLIDAYS.

 

Unless otherwise provided by supplemental indenture for a particular Series, a “Legal Holiday” is any day that is not a Business Day.  If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period.

 

Section 11.8.                          NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS.

 

No director, manager, officer, employee, incorporator, stockholder or member of the Company or any Restricted Subsidiary, as such, shall have any liability for any obligations of the Company or any Restricted Subsidiary under the Securities of any Series, the Subsidiary 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 Securities of any Series by accepting the Security and the Subsidiary Guarantees waives and releases all such liability.  The waiver and release are part of the consideration for issuance of the Securities of any Series and the Subsidiary Guarantees.

 

Section 11.9.                          COUNTERPARTS.

 

This Indenture 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.

 

Section 11.10.                   GOVERNING LAWS.

 

THIS INDENTURE, THE SECURITIES AND THE SUBSIDIARY GUARANTEES SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.

 

Section 11.11.                   NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.

 

This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary.  Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

 

Section 11.12.                   SUCCESSORS.

 

All agreements of the Company and the Guarantors in this Indenture and the Securities and the Subsidiary Guarantees shall bind their respective successors.  All agreements of the Trustee in this Indenture shall bind its successors.

 

Section 11.13.                   SEVERABILITY.

 

In case any provision in this Indenture, the Securities or the Subsidiary Guarantees, if any, 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.

 

Section 11.14.                   TABLE OF CONTENTS, HEADINGS, ETC.

 

The Table of Contents, Cross Reference Table, and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.

 

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Section 11.15.                   SECURITIES IN A FOREIGN CURRENCY OR IN EUROS.

 

Unless otherwise specified in a Board Resolution, Officers’ Certificate or a supplemental indenture with respect to a particular Series of Securities, whenever for purposes of this Indenture any action may be taken by the Holders of a specified percentage in aggregate principal amount of Securities of all Series or all Series affected by a particular action at the time outstanding and, at such time, there are outstanding Securities of any Series which are denominated in a coin or currency other than Dollars (including Euros), then the principal amount of Securities of such Series which shall be deemed to be outstanding for the purpose of taking such action shall be that amount of Dollars that could be obtained for such amount at the Market Exchange Rate at such time.  For purposes of this Section 11.15, “Market Exchange Rate” shall mean the noon Dollar buying rate in New York City for cable transfers of that currency as published by the Federal Reserve Bank of New York; provided, however, in the case of Euros, Market Exchange Rate shall mean the rate of exchange determined by the Commission of the European Union (or any successor thereto) as published in the Official Journal of the European Union (such publication or any successor publication, the “Journal”).  If such Market Exchange Rate is not available for any reason with respect to such currency, such foreign exchange agent appointed by the Company shall use, in its sole discretion and without liability on its part, such quotation of the Federal Reserve Bank of New York or, in the case of Euros, the rate of exchange as published in the Journal, as of the most recent available date, or quotations or, in the case of Euros, rates of exchange from one or more major banks in The City of New York or in the country of issue of the currency in question or, in the case of Euros, in Luxembourg or such other quotations or, in the case of Euros, rates of exchange as such foreign exchange agent appointed by the Company, upon consultation with the Company, shall deem appropriate.  The provisions of this paragraph shall apply in determining the equivalent principal amount in respect of Securities of a Series denominated in currency other than Dollars in connection with any action taken by Holders of Securities pursuant to the terms of this Indenture.

 

All decisions and determinations of such foreign exchange agent appointed by the Company regarding the Market Exchange Rate or any alternative determination provided for in the preceding paragraph shall be in its sole discretion and shall, in the absence of manifest error, be conclusive to the extent permitted by law for all purposes and irrevocably binding upon the Company and all Holders, and Trustee shall have no liability or responsibility for such determination.

 

Section 11.16.                   JUDGMENT CURRENCY.

 

The Company agrees, to the fullest extent that it may effectively do so under applicable law, that (a) if for the purpose of obtaining judgment in any court it is necessary to convert the sum due in respect of the principal of or interest or other amount on the Securities of any Series (the “Required Currency”) into a currency in which a judgment will be rendered (the “Judgment Currency”), the rate of exchange used shall be the rate at which in accordance with normal banking procedures such foreign exchange agent appointed by the Company could purchase in The City of New York the Required Currency with the Judgment Currency on the day on which final unappealable judgment is entered, unless such day is not a New York Banking Day, then, the rate of exchange used shall be the rate at which in accordance with normal banking procedures such foreign exchange agent appointed by the Company could purchase in The City of New York the Required Currency with the Judgment Currency on the New York Banking Day preceding the day on which final unappealable judgment is entered and (b) its obligations under this Indenture to make payments in the Required Currency (i) shall not be discharged or satisfied by any tender, any recovery pursuant to any judgment (whether or not entered in accordance with subsection (a)), in any currency other than the Required Currency, except to the extent that such tender or recovery shall result in the actual receipt, by the payee, of the full amount of the Required Currency expressed to be payable in respect of such payments, (ii) shall be enforceable as an alternative or additional cause of action for the purpose of recovering in the Required Currency the amount, if any, by which such actual receipt shall fall short of the full amount of the Required Currency so expressed to be payable, and (iii) shall not be affected by judgment being obtained for any other sum due under this Indenture.  For purposes of the foregoing, “New York Banking Day” means any day except a Saturday, Sunday or a legal holiday in The City of New York on which banking institutions are authorized or required by law, regulation or executive order to close.

 

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Section 11.17.                   WAIVER OF JURY TRIAL.

 

EACH OF THE COMPANY, THE GUARANTORS AND THE TRUSTEE 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 NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.

 

Section 11.18.                   SUBMISSION TO JURISDICTION; VENUE.

 

THE COMPANY AND EACH GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE GUARANTEES AND THE NOTES, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS.  THE COMPANY AND EACH GUARANTOR IRREVOCABLY WAIVES, TO THE FULLEST EXTENT THAT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE TRUSTEE OR ANY HOLDER OF THE NOTES TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY OR ANY GUARANTOR IN ANY OTHER JURISDICTION.

 

Section 11.19.                   FORCE MAJEURE.

 

In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

 

ARTICLE XII.
 SINKING FUNDS

 

Section 12.1.                          APPLICABILITY OF ARTICLE.

 

The provisions of this Article shall be applicable to any sinking fund for the retirement of the Securities of a Series, except as otherwise permitted or required by any form of Security of such Series issued pursuant to this Indenture.

 

The minimum amount of any sinking fund payment provided for by the terms of the Securities of any Series is herein referred to as a “mandatory sinking fund payment” and any other amount provided for by the terms of Securities of such Series is herein referred to as an “optional sinking fund payment.” If provided for by the terms of Securities of any Series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 12.2.  Each sinking fund payment shall be applied to the redemption of Securities of any Series as provided for by the terms of the Securities of such Series.

 

Section 12.2.                          SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.

 

The Company may, in satisfaction of all or any part of any sinking fund payment with respect to the Securities of any Series to be made pursuant to the terms of such Securities (1) deliver outstanding Securities of such Series to which such sinking fund payment is applicable (other than any of such Securities previously called for

 

39

 

mandatory sinking fund redemption) and (2) apply as credit Securities of such Series to which such sinking fund payment is applicable and which have been redeemed either at the election of the Company pursuant to the terms of such Series of Securities (except pursuant to any mandatory sinking fund) or through the application of permitted optional sinking fund payments or other optional redemptions pursuant to the terms of such Securities, provided that such Securities have not been previously so credited.  Such Securities shall be received by the Trustee, together with an Officers’ Certificate with respect thereto, not later than 15 days prior to the date on which the Trustee begins the process of selecting Securities for redemption in the manner specified in Section 3.2, and shall be credited for such purpose by the Trustee at the price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly.  If as a result of the delivery or credit of Securities in lieu of cash payments pursuant to this Section 12.2, the principal amount of Securities of such Series to be redeemed in order to exhaust the aforesaid cash payment shall be less than $100,000, the Trustee need not call Securities of such Series for redemption, except upon receipt of a Company Order that such action be taken, and such cash payment shall be held by the Trustee or a Paying Agent and applied to the next succeeding sinking fund payment, provided, however, that the Trustee or such Paying Agent shall from time to time upon receipt of a Company Order pay over and deliver to the Company any cash payment so being held by the Trustee or such Paying Agent upon delivery by the Company to the Trustee of Securities of that Series purchased by the Company having an unpaid principal amount equal to the cash payment required to be released to the Company.

 

Section 12.3.                          REDEMPTION OF SECURITIES FOR SINKING FUND.

 

Not less than 45 days (unless otherwise indicated in the Board Resolution, supplemental indenture hereto or Officers’ Certificate in respect of a particular Series of Securities) prior to each sinking fund payment date for any Series of Securities, the Company will deliver to the Trustee an Officers’ Certificate specifying the amount of the next ensuing mandatory sinking fund payment for that Series pursuant to the terms of that Series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering and crediting of Securities of that Series pursuant to Section 12.2, and the optional amount, if any, to be added in cash to the next ensuing mandatory sinking fund payment, and the Company shall thereupon be obligated to pay the amount therein specified.  Not less than 30 days (unless otherwise indicated in the Board Resolution, Officers’ Certificate or supplemental indenture in respect of a particular Series of Securities) before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 3.2 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 3.3.  Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections 3.4, 3.5 and 3.6.

 

ARTICLE XIII.
 SUBSIDIARY GUARANTEES

 

Section 13.1.                          SUBSIDIARY GUARANTEE.

 

Each Subsidiary that is a signatory hereto and each Subsidiary of the Company that in accordance with the terms of any Securities of a Series issued hereunder pursuant to any supplement indenture relating to such Securities is required to become party to this Indenture as a guarantor (each, a “Guarantor”), upon execution of a supplemental indenture, hereby jointly and severally unconditionally guarantees to each Securityholder of a Security of a Series that is to be guaranteed and that has been authenticated and delivered by the Trustee irrespective of the validity or enforceability of this Indenture, the Securities or the obligations of the Company under this Indenture or the Securities, that: (i) the principal of and interest on the Securities will be paid in full when due, whether at the maturity or interest payment or mandatory redemption date, by acceleration, call for redemption or otherwise, and interest on the overdue principal of and interest, if any, on the Securities and all other obligations of the Company to the Securityholders or the Trustee under this Indenture or the Securities will be promptly paid in full or performed, all in accordance with the terms of this Indenture and the Securities; and (ii) in case of any extension of time of payment or renewal of any Securities or any of such other obligations, they will be paid in full when due or performed in accordance with the terms of the extension or renewal, whether at maturity, by acceleration or otherwise.  Failing payment when due of any amount so guaranteed for whatever reason, each Guarantor will be obligated to pay the same whether or not such failure to pay has become an Event of Default which could cause acceleration pursuant to Section 6.2.  Each Guarantor agrees that this is a guarantee of payment not a guarantee of collection.

 

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Each Guarantor hereby agrees that its obligations with regard to this Subsidiary Guarantee shall be joint and several and unconditional, irrespective of the validity or enforceability of the Securities or the obligations of the Company under this Indenture, the absence of any action to enforce the same, the recovery of any judgment against the Company or any other obligor with respect to this Indenture, the Securities or the obligations of the Company under this Indenture or the Securities, any action to enforce the same or any other circumstances (other than complete performance) which might otherwise constitute a legal or equitable discharge or defense of a Guarantor.  Each Guarantor further, to the extent permitted by law, waives and relinquishes all claims, rights and remedies accorded by applicable law to guarantors and agrees not to assert or take advantage of any such claims, rights or remedies, including but not limited to: (a) any right to require the Trustee, the Securityholders or the Company (each, a “Benefited Party”) to proceed against the Company or any other Person or to proceed against or exhaust any security held by a Benefited Party at any time or to pursue any other remedy in any Benefited Party’s power before proceeding against such Guarantor; (b) the defense of the statute of limitations in any action hereunder or in any action for the collection of any Indebtedness or the performance of any obligation hereby guaranteed; (c) any defense that may arise by reason of the incapacity, lack of authority, death or disability of any other Person or the failure of a Benefited Party to file or enforce a claim against the estate (in administration, bankruptcy or any other proceeding) of any other Person; (d) demand, protest and notice of any kind including but not limited to notice of the existence, creation or incurring of any new or additional Indebtedness or obligation or of any action or non-action on the part of such Guarantor, the Company, any Benefited Party, any creditor of such Guarantor, the Company or on the part of any other Person whomsoever in connection with any Indebtedness or obligations hereby guaranteed; (e) any defense based upon an election of remedies by a Benefited Party, including but not limited to an election to proceed against such Guarantor for reimbursement; (f) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (g) any defense arising because of a Benefited Party’s election, in any proceeding instituted under Bankruptcy Law, of the application of 11 U.S.C. Section 1111 (b)(2); or (h) any defense based on any borrowing or grant of a security interest under 11 U.S.C. Section 364.  Each Guarantor hereby covenants that its Subsidiary Guarantee will not be discharged except by complete performance of the obligations contained in its Subsidiary Guarantee and this Indenture.

 

If any Securityholder or the Trustee is required by any court or otherwise to return to either the Company or any Guarantor, or any Custodian acting in relation to either the Company or such Guarantor, any amount paid by the Company or such Guarantor to the Trustee or such Securityholder, the applicable Subsidiary Guarantees, to the extent theretofore discharged, shall be reinstated and be in full force and effect.  Each Guarantor agrees that it will not be entitled to any right of subrogation in relation to the Securityholders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby.

 

Each Guarantor further agrees that, as between such Guarantor, on the one hand, and the Securityholders and the Trustee, on the other hand, (i) the maturity of the obligations guaranteed hereby may be accelerated as provided in Section 6.2 for the purposes of this Subsidiary Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration as to the Company or any other obligor on the Securities of the obligations guaranteed hereby, and (ii) in the event of any declaration of acceleration of those obligations as provided in Section 6.2, those obligations (whether or not due and payable) will forthwith become due and payable by such Guarantor for the purpose of this Subsidiary Guarantee.

 

Section 13.2.                          LIMITATION OF GUARANTOR’S LIABILITY.

 

Each Guarantor and, by its acceptance hereof, the Trustee and each Securityholder hereby confirm that it is its intention that the Subsidiary Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to any Subsidiary Guarantee.  To effectuate the foregoing intention, each such Person hereby irrevocably agrees that the obligation of such Guarantor under its Subsidiary Guarantee under this Article XIII shall be limited to the maximum amount as will, after giving effect to such maximum amount and all other (contingent or other) liabilities of such Guarantor that are relevant under such laws, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under this Article XIII, result in the obligations of such Guarantor in respect of such maximum amount not constituting a fraudulent transfer or conveyance under said laws.  The Trustee and each Securityholder by accepting the benefits hereof, confirms its

 

41

 

intention that, in the event of a bankruptcy, reorganization or other similar proceeding of the Company or any Guarantor in which concurrent claims are made upon such Guarantor hereunder, to the extent such claims will not be fully satisfied, each such claimant with a valid claim against the Company shall be entitled to a ratable share of all payments by such Guarantor in respect of such concurrent claims.

 

ARTICLE XIV.
  USA PATRIOT ACT

 

Section 14.1.                          USA PATRIOT ACT.

 

The parties hereto acknowledge that in accordance with Section 326 of the USA Patriot Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee.  The parties to this Indenture agree that they will provide the Trustee with such information as it may reasonably request in order for the Trustee to satisfy the requirements of the USA Patriot Act.

 

[Remainder of Page Left Blank Intentionally; Signature Pages Follow Immediately.]

 

42

 

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of the date and year first written above.

 

	
 
    	
IRON MOUNTAIN INCORPORATED
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
IRON   MOUNTAIN GLOBAL HOLDINGS, INC.
    
	
 
    	
IRON   MOUNTAIN INFORMATION MANAGEMENT SERVICES, INC.
    
	
 
    	
IRON   MOUNTAIN INTELLECTUAL PROPERTY MANAGEMENT, INC.
    
	
 
    	
IRON   MOUNTAIN SECURE SHREDDING, INC.
    
	
 
    	
IRON MOUNTAIN   US HOLDINGS, INC.
    
	
 
    	
NETTLEBED   ACQUISITION CORP.
    
	
 
    	
IRON   MOUNTAIN INFORMATION MANAGEMENT, LLC
    
	
 
    	
IRON   MOUNTAIN GLOBAL LLC
    
	
 
    	
IRON   MOUNTAIN DATA CENTERS, LLC
   IRON MOUNTAIN DATA CENTERS SERVICES, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

[Signature Page to Senior Indenture]

 

43

 

	
 
    	
WELLS FARGO BANK, NATIONAL   ASSOCIATION,
   as Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

[Signature Page to Senior Indenture]

 

44

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