EXHIBIT 4.10
CONFORMED COPY
AMENDED AND RESTATED
FACILITIES AGREEMENT
FOR
L412,300,000 SENIOR SECURED CREDIT FACILITIES
FOR
PREMIER FINANCING LIMITED
AND OTHERS
MANDATED LEAD ARRANGERS OF THE AMENDMENT AND RESTATEMENT
▇.▇. ▇▇▇▇▇▇ PLC
AND
BARCLAYS CAPITAL
AMENDMENT AND RESTATEMENT UNDERWRITTEN BY
JPMORGAN CHASE BANK
AND
BARCLAYS BANK PLC
AGENT
AND
SECURITY AGENT
▇.▇. ▇▇▇▇▇▇ EUROPE LIMITED
▇▇▇▇▇▇ ▇▇▇▇
London
CONTENTS
CLAUSE HEADING PAGE
1 Interpretation.............................................................................. 1
1.1 Definitions........................................................................ 1
1.2 Headings........................................................................... 33
1.3 Construction of certain terms...................................................... 33
1.4 Successors and assigns............................................................. 35
2 The Facilities.............................................................................. 36
2.1 The Term Facilities................................................................ 36
2.2 The Working Capital Facility....................................................... 37
2.3 Several obligations................................................................ 37
3 The Conditions.............................................................................. 37
3.1 Documents and evidence............................................................. 37
3.2 General conditions precedent....................................................... 37
3.3 Facility A......................................................................... 37
3.4 Working Capital Facility........................................................... 38
3.5 Waiver of conditions precedent..................................................... 38
4 Drawings Under the Facilities............................................................... 38
4.1 The Term Facilities................................................................ 38
4.2 The Working Capital Facility....................................................... 40
4.3 Selection of currencies in respect of the Working Capital Facility................. 41
4.4 The Ancillary Facilities........................................................... 41
4.5 Limits............................................................................. 43
4.6 Commitments of Ancillary Facilities Banks.......................................... 43
4.7 Cancellation of Ancillary Facilities............................................... 44
4.8 Operation of accounts notwithstanding the Security Documents....................... 44
4.9 Letters of Credit: Drawdown Notice................................................. 44
4.10 Fronting Bank to act as principal.................................................. 45
4.11 Borrower's authorisation........................................................... 45
4.12 Working Capital Borrowers' failure to perform...................................... 46
4.13 Deemed cash advance................................................................ 47
4.14 Preservation of Fronting Bank's rights............................................. 47
4.15 No obligation on Fronting Bank..................................................... 48
4.16 Defaulting Working Capital Bank.................................................... 48
4.17 Drawings generally................................................................. 49
4.18 Application of proceeds............................................................ 49
5 Interest and Interest Periods............................................................... 49
5.1 Interest on the Term Advances...................................................... 49
5.2 Interest and fees under the Working Capital Facility............................... 51
5.3 Interest on overdue amounts........................................................ 53
5.4 Notification of Interest Periods and interest rate................................. 54
5.5 Reference Bank quotations.......................................................... 54
6 Repayment, prepayment, cancellation and reductions.......................................... 54
6.1 Repayment of the Facilities........................................................ 54
6.2 Repayment of Working Capital Advances.............................................. 55
6.3 Repayment and discharge of Ancillary Facilities and Letters of Credit.............. 56
6.4 Optional prepayment of all the Banks............................................... 56
6.5 Optional prepayment of a Bank...................................................... 56
6.6 Mandatory prepayments.............................................................. 57
6.7 Prepayments generally.............................................................. 59
6.8 Voluntary cancellation of the Working Capital Facility............................. 60
6.9 Mandatory cancellation............................................................. 60
6.10 Application of disposal proceeds................................................... 60
6.11 Cash sweep......................................................................... 62
6.12 Citadel Insurance Company Limited.................................................. 62
7 Fees and expenses........................................................................... 63
7.1 Arrangement, underwriting and agency fees.......................................... 63
7.2 Commitment fees.................................................................... 63
7.3 Expenses........................................................................... 63
7.4 Value added tax.................................................................... 64
7.5 Stamp and other duties............................................................. 64
8 Payments and Taxes; accounts and calculations............................................... 64
8.1 No set-off or counterclaim; distribution to the Banks.............................. 64
8.2 Payments by the Banks.............................................................. 65
8.3 Non-Banking Days................................................................... 65
8.4 Agent may assume receipt........................................................... 65
8.5 Grossing-up for Taxes.............................................................. 65
8.6 Qualifying Banks................................................................... 66
8.7 Claw-back of Tax benefit........................................................... 66
8.8 Bank accounts...................................................................... 67
8.9 Partial payments................................................................... 67
8.10 Calculations....................................................................... 68
8.11 Certificates conclusive............................................................ 68
8.12 Effect of European monetary union.................................................. 69
9 Representations and warranties.............................................................. 69
9.1 Repeating representations and warranties........................................... 69
9.2 Non-repeating representations and warranties....................................... 71
9.3 Repetition......................................................................... 75
10 Undertakings................................................................................ 76
10.1 Information undertakings........................................................... 76
10.2 General undertakings............................................................... 79
10.3 Financial undertakings............................................................. 83
10.4 Conditions subsequent.............................................................. 84
10.5 Hedge Transactions................................................................. 85
10.6 Negative undertakings.............................................................. 86
10.7 Conduct of the Second Acquisitions................................................. 97
10.8 Conditions to the Irish Second Acquisition Completion Date......................... 99
11 The Scheme and related matters.............................................................. 99
11.1 The Scheme......................................................................... 99
12 Events of Default........................................................................... 100
12.1 Events of Default.................................................................. 100
12.2 Acceleration....................................................................... 105
12.3 Demand basis....................................................................... 106
12.4 Clean-up period.................................................................... 106
13 Indemnities................................................................................. 106
13.1 Miscellaneous indemnities.......................................................... 106
13.2 Currency of account; currency indemnity............................................ 107
13.3 Acquisition finance indemnity...................................................... 108
13.4 ESCB reserve requirements.......................................................... 108
13.5 Environmental Indemnity............................................................ 108
14 Unlawfulness, increased costs, alternative interest rates................................... 108
14.1 Unlawfulness....................................................................... 108
14.2 Increased costs.................................................................... 108
14.3 Exceptions......................................................................... 110
14.4 Market disruption; non-availability................................................ 110
14.5 Mitigation......................................................................... 111
14.6 Non-availability of Optional Currencies............................................ 112
14.7 Replacement of Banks............................................................... 112
15 Set-off and pro-rata payments............................................................... 113
15.1 Set-off............................................................................ 113
15.2 Pro-rata payments.................................................................. 114
15.3 No release......................................................................... 115
15.4 No charge.......................................................................... 115
15.5 Other transactions................................................................. 115
15.6 Sharing under Working Capital Facility and the Ancillary Facilities................ 115
16 Assignment, substitution and lending offices................................................ 116
16.1 Benefit and burden................................................................. 116
16.2 No assignment by the Borrowers..................................................... 117
16.3 Substitution....................................................................... 117
16.4 Reliance on Substitution Certificate............................................... 118
16.5 Authorisation of Agent............................................................. 118
16.6 Construction of certain references................................................. 118
16.7 Lending offices.................................................................... 118
16.8 Disclosure of information.......................................................... 119
16.9 Details of novations............................................................... 119
16.10 No additional amounts.............................................................. 120
16.11 The Register....................................................................... 120
16.12 Bank Affiliates.................................................................... 121
17 Appointment of Agent and Security Agent..................................................... 121
17.1 Appointment........................................................................ 121
17.2 Agent's and Security Agent's actions............................................... 122
17.3 Agent's duties..................................................................... 123
17.4 Agent's and Security Agent's rights................................................ 123
17.5 No liability of Arrangers, Security Agent and Agent................................ 124
17.6 Non-reliance on Arrangers, Security Agent or Agent................................. 125
17.7 No responsibility on Arrangers, Security Agent or Agent for certain matters........ 125
17.8 Reliance on documents and professional advice...................................... 127
17.9 Other dealings..................................................................... 127
17.10 Rights of Agent and Security Agent as Bank; no partnership......................... 127
17.11 Amendments and waivers............................................................. 127
17.12 Reimbursement and indemnity by Banks............................................... 129
17.13 Retirement of Agent and Security Agent............................................. 129
17.14 Change of Reference Banks.......................................................... 130
17.15 Declaration of trust............................................................... 131
17.16 Perpetuities....................................................................... 132
17.17 Powers and duties of the Security Agent as trustee of the security................. 132
17.18 All enforcement action through the Security Agent.................................. 134
17.19 Co-operation to achieve agreed priorities of application........................... 134
17.20 Indemnity from Trust Property...................................................... 134
17.21 Finance Parties to provide information............................................. 134
17.22 Ancillary Facilities Liabilities................................................... 135
17.23 Underwriters and Documentation Agent............................................... 135
17.24 Security Agent as joint creditor................................................... 135
17.25 Security Agent's rights as joint creditor.......................................... 135
18 Decisions of Banks and Agent................................................................ 136
18.1 Obligations several................................................................ 136
18.2 Interests several.................................................................. 136
18.3 Majority Banks..................................................................... 136
18.4 Banks acting together.............................................................. 137
19 Cash Collateral Accounts.................................................................... 137
19.1 Applications and withdrawals....................................................... 137
19.2 Security over Cash Collateral Accounts............................................. 137
19.3 Interest and broken deposits....................................................... 137
19.4 Application of surplus cash collateral following Enforcement Date.................. 138
20 Matters concerning the Borrowers............................................................ 138
20.1 Additional Borrowers: UK resident Subsidiary....................................... 138
20.2 Additional Borrowers: Non-UK resident Subsidiary................................... 138
20.3 Notice............................................................................. 139
20.4 Cessation.......................................................................... 139
20.5 Indemnity.......................................................................... 140
20.6 Newco 2 as Borrowers' agent........................................................ 140
20.7 Amendments binding................................................................. 140
20.8 Obligations unconditional.......................................................... 140
20.9 Obligations several................................................................ 141
21 Notices and other matters................................................................... 141
21.1 Address for notice................................................................. 141
21.2 Notice to Agent.................................................................... 143
21.3 No implied waiver, remedies cumulative............................................. 143
21.4 Counterparts....................................................................... 143
21.5 Conflicts.......................................................................... 143
21.6 Communications indemnity........................................................... 144
21.7 Notice of the end of the Finance Period............................................ 144
21.8 Third party rights................................................................. 144
22 Governing law and jurisdiction.............................................................. 145
22.1 Law................................................................................ 145
22.2 Submission to jurisdiction......................................................... 145
22.3 Agent for service of process....................................................... 145
Schedule 1 The Banks and their Commitments........................................................... 146
Schedule 2 Forms of Drawdown (and other) Notices..................................................... 151
Part A - Facility A and Facility B.......................................................... 151
Part B - The Working Capital Facility....................................................... 152
Schedule 3 Documents and evidence required as conditions precedent to the Irish Second Acquisition... 153
Schedule 4 Calculation of Additional Cost............................................................ 155
Schedule 5 Form of Substitution Certificate.......................................................... 158
Part A (single transfers)................................................................... 158
Part B (global form)........................................................................ 163
Schedule 6 The Group as at the Second Effective Date................................................. 167
Schedule 7 Structure Chart.......................................................................... 171
Schedule 8 Financial undertakings, Margin and commitment commission adjustment and accounting terms.. 173
Schedule 9 Form of Accession Certificate............................................................. 181
Schedule 10 Form of Director's Certificate........................................................... 183
Schedule 11 Form of Annual Auditor's Report.......................................................... 184
Schedule 12 Terms of Indemnity in relation to Letters of Credit...................................... 186
Schedule 13 Part A [Not restated]................................................................... 189
Part B [Not restated]....................................................................... 190
Schedule 14 ▇▇▇▇▇ Muse's fees........................................................................ 191
Schedule 15 Other Finance Parties.................................................................... 192
THIS AGREEMENT is dated 10 August 1999, amended on 20 August 1999 and 5 November
1999, amended and restated with effect from the Second Effective Date and
further amended on 30 October 2003 and 17 November 2003 and made BETWEEN:
(1) PREMIER FINANCING LIMITED as Newco 2 and a Borrower;
(2) ▇.▇. ▇▇▇▇▇▇ PLC and BARCLAYS CAPITAL (the Investment Banking Division of
Barclays Bank PLC) as Amendment Arrangers;
(3) JPMORGAN CHASE BANK and BARCLAYS BANK PLC as Amendment Underwriters;
(4) THE PERSONS whose names and addresses are set out in schedule 1 as Banks;
(5) THE BANKS AND FINANCIAL INSTITUTIONS whose names and capacities are set
out in schedule 15; and
(6) ▇.▇. ▇▇▇▇▇▇ EUROPE LIMITED as the Agent and the Security Agent.
IT IS AGREED as follows:
1 INTERPRETATION
1.1 DEFINITIONS
In this Agreement, unless the context otherwise requires:
"ACCESSION CERTIFICATE" means a certificate substantially in the form of
schedule 9;
"ACCOUNTANTS' REPORT" means the report compiled or to be compiled by
PricewaterhouseCoopers and addressed to the Finance Parties in connection
with the Acquisition;
"ACQUISITION" means the acquisition by Newco 2, Cayman 1 and Cayman 2 of
the Target pursuant to the Scheme;
"ACQUISITION PARTIES" means Newco ▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇ ▇, ▇▇ Topco and the
Second Purchasers;
"ACT" means the Companies ▇▇▇ ▇▇▇▇;
"ACTING IN CONCERT" has the meaning given to that term in the Code;
"ADDITIONAL COST RATE" has the meaning given to it in schedule 4;
"ADDITIONAL COST" means the percentage rate per annum calculated by the
Agent in accordance with schedule 4;
"ADVANCE" means any Term Advance and any Working Capital Advance or any of
them;
1
"AFFILIATE" in relation to any person means a Subsidiary or a Holding
Company of that person and any other Subsidiary of a Holding Company of
that person;
"AGENT" means ▇.▇. ▇▇▇▇▇▇ Europe Limited of ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ acting in its capacity as agent for the Banks or such other person as
may be appointed agent for the Banks pursuant to clause 17.13;
"AMENDMENT ARRANGERS" means ▇.▇. ▇▇▇▇▇▇ plc of ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ and Barclays Capital of 5 ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"AMENDMENT UNDERWRITERS" means JPMorgan Chase Bank of ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ and Barclays Bank PLC of ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇;
"ANCILLARY COMMITMENT" means in relation to an Ancillary Facilities Bank,
the maximum amount (net of cash) from time to time of the Ancillary
Facilities to be made available by the Ancillary Facilities Bank which has
been authorised as such under clause 4.4 to the extent not cancelled under
this Agreement;
"ANCILLARY FACILITIES" means the facilities made available in accordance
with clause 4.4 and the Ancillary Facilities Letters;
"ANCILLARY FACILITIES BANKS" means those persons (subject to clause 16.6,
each being a Bank) which shall at any relevant time agree to make
available Ancillary Facilities in accordance with clause 4.4;
"ANCILLARY FACILITIES BORROWERS" means Newco 2 and those wholly-owned
Subsidiaries of Newco 2 which are Charging Subsidiaries and which in each
case accede to this Agreement as "Ancillary Facilities Borrowers" pursuant
to clause 20 and an "ANCILLARY FACILITIES BORROWER" means any of them;
"ANCILLARY FACILITIES LETTER" means each of the letters entered into, or
to be entered into, between an Ancillary Facilities Bank and any Ancillary
Facilities Borrower setting out the terms and conditions on and subject to
which the Ancillary Facilities are made available and "ANCILLARY
FACILITIES LETTERS" means all of them;
"ANCILLARY FACILITIES LIABILITIES" means, in respect of any one or more of
the Ancillary Facilities Banks at any relevant time, the aggregate amount
(if any, calculated (save where the context otherwise requires) on a net
basis) of the liabilities of the Ancillary Facilities Borrowers (actual or
contingent and whether as principal or surety, provided that there shall
be no double-counting of the liabilities of any Ancillary Facilities
Borrower as surety for the liabilities of another Ancillary Facilities
Borrower as principal) outstanding in respect of the Ancillary Facilities
made available by such Ancillary Facilities Bank(s) and any reference to,
or question as to, the "AMOUNT OF THE ANCILLARY FACILITIES LIABILITIES" at
any time means the amount of such liabilities at such time as calculated
by the Ancillary Facilities Bank(s) in good faith in accordance with its
(or their respective) usual practices in relation to such facilities For
the avoidance of doubt (and without limitation) for the purposes of clause
15.6 the
2
amount of the Ancillary Facilities Liabilities owing to an Ancillary
Facilities Bank shall be calculated on a net basis irrespective of whether
such Ancillary Facilities Bank is able to apply any credit balance which
it holds against any debt balance;
"ANNOUNCEMENT DATE" means 14 May 1999;
"ANNUAL BUDGET" means, in respect of each financial year of the Group, a
budget for such succeeding financial year containing such information as
Newco 2 and the Agent may from time to time agree (acting reasonably) and
including specifically, but without limitation:
(a) (i) a consolidated profit (or loss) forecast, and
(ii) a consolidated cashflow forecast (including Capital
Expenditure),
(in each case) in respect of each month in such financial year and
in respect of such financial year to date prepared down to the end
of such month;
(b) a projected consolidated balance sheet as at the end of each month
in such financial year; and
(c) a commentary on such business plan and budget (including material
Capital Expenditure and cost savings);
"APPROPRIATE ACCOUNTING PRINCIPLES" means (i) the accounting principles,
policies, standards, practices and bases stated in the audited
consolidated financial statements of the Target Group for the year ending
31 December 1998 (being generally accepted in the United Kingdom or (ii)
where any change in (i) has been agreed under clause 10.6(p), such
accounting principles, standards, practices and bases as have been so
agreed;
"APPROVED BANK" means each Bank and any bank which is an authorised
banking institution under applicable local law and which has waived in
writing in a form satisfactory to the Agent (acting reasonably) any rights
of set-off which it may have in respect of the account of any member of
the Group held with it;
"ARRANGERS" means the Original Arrangers and the Amendment Arrangers;
"ASSET SALE" means the disposal of substantially all of the assets and
undertaking of the Group (whether by way of a share sale or otherwise) to
a single purchaser or to one or more purchasers as part of a single
transaction or related transactions;
"AUDITORS" means the auditors for the time being of Newco 2 or, if such
auditors are unable or unwilling to provide any certificate or take any
other action contemplated by this Agreement, any one of the chartered
accountants Deloitte Touche Tohmatsu, Ernst & Young, KPMG or
PricewaterhouseCoopers (each a "BIG 4 FIRM") as may be selected by Newco 2
after consultation with the Agent;
3
"AVAILABLE COMMITMENT" means, in relation to a Bank in respect of any
Tranche or (as applicable) any Facility at any time, its Commitment in
respect of such Tranche or (as applicable) Facility at such time less the
aggregate Sterling Amount of its Contribution in respect of such Tranche
or (as applicable) Facility at that time and (in the case of the Working
Capital Facility) less its Ancillary Commitment (if any) at such time;
"AVAILABLE FACILITY AMOUNT" means, at any time and in respect of any
Tranche or Facility, the aggregate of the Available Commitments of all the
Banks in respect of such Tranche or (as applicable) Facility at such time,
but so that, as at the Drawdown Date of any Working Capital Advance, such
resulting amount shall be adjusted by (i) deducting any cancellation of or
reduction in the Total Commitments in respect of the Working Capital
Facility which will occur during the Maturity Period of such Working
Capital Advance, (ii) increased by the amount of Working Capital Advances
which are due to be repaid on or prior to such Drawdown Date and (iii)
reduced by deducting the amount of any Working Capital Advances previously
requested to be made on such Drawdown Date;
"BACS DOCUMENTS" means the documents evidencing the BACS facilities from
time to time made available to the Borrowers by the Ancillary Facilities
Banks;
"BANK AFFILIATE" means (A) with respect to any person (other than a fund),
any other person directly or indirectly controlling, controlled by, or
under direct or indirect common control with, such first person, where a
person shall be deemed to have control of a corporation if such person
possesses directly or indirectly, the power to (1) vote 50 per cent. or
more of the securities having ordinary voting power for the election of
directors of such corporation or (2) direct or cause the direction of the
management and policies of such corporation, whether through the ownership
of voting securities, by contract or otherwise or (B) with respect to any
person that is a fund, any other fund which is advised or managed by the
same investment adviser or an Affiliate of that investment advisor;
"BANKING DAY" means:
(a) when EURIBOR is to be determined, a TARGET Day;
(b) in relation to a date for the payment or purchase of euro, a TARGET
Day; and
(c) for all other purposes a day other than (Saturday, Sunday or a
public holiday) on which banks are open for business in London and
(in the case of interest rate fixing and payments in relation to
Optional Currencies or National Currency Units) in the principal
financial centre in the jurisdiction of the Optional Currency or
National Currency Unit concerned;
"BANKS" means the Facility A Banks, the Facility B Banks, the Working
Capital Banks and the Ancillary Facilities Banks and "BANK" means any of
them;
"BARCLAYS CAPITAL" means Barclays Capital, the investment banking division
of Barclays Bank PLC;
4
"BOND AND FLOATING CHARGES" means the bonds and floating charges in the
agreed form entered into, or to be entered into by each of Premier Brands
Limited, Melrose Limited, Ridgways Limited and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Sons (Est.
1849) Limited in favour of the Security Agent;
"BORROWED MONEY" means, in respect of any person, Indebtedness in respect
of (without double counting) (i) money borrowed or debit balances at
banks, (ii) any bond, note, loan stock, debenture or similar debt
instrument, (iii) acceptance or documentary credit facilities, (iv)
receivables sold or discounted (otherwise than on a non-recourse basis to
the relevant person), (v) deferred payments for assets or services
acquired (other than current trade liabilities and accrued expenses
incurred in the ordinary course of business), (vi) Finance Leases, (vii)
(except in clause 12.1(e) and schedule 8) Derivatives Transactions, (viii)
any other transaction (including without limitation forward sale or
purchase agreements) having the commercial effect of a borrowing or of any
of (ii) to (vii) above and (ix) guarantees in respect of Indebtedness of
any person falling within any of (i) to (viii) above;
"BORROWER SECURITY DOCUMENTS" means those of the Security Documents to
which a Borrower is party;
"BORROWERS" means Newco 2 and (subject to their respective accessions) the
Working Capital Borrowers and the Ancillary Facilities Borrowers;
"BUDGETED CAPITAL EXPENDITURE" means Capital Expenditure incurred or to be
incurred in the financial year ending 31 December, 2003 and each financial
year ending 31 December thereafter up to a maximum of L18,750,000 or
(a) provided that Permitted Acquisitions have been made after the date on
which the Majority Banks consented to the requests contained in the
consent request letter dated 2 October 2003, for an aggregate acquisition
consideration of at least L35,000,000 (or its equivalent), up to a
maximum, in the case of the financial years ending 31 December, 2004 and
31 December, 2005, of L21,750,000 and, in the case of each financial
year ending 31 December thereafter, L20,750,000, provided that such
increased amounts shall only apply from and including the financial year
in which the L35,000,000 threshold referred to above is reached or
(b)such higher limit in respect of any financial year as may be agreed
between Newco 2 and the Agent (acting on the instructions of the Majority
Banks) but so that (i) where in any financial year actual Capital
Expenditure is less than the Budgeted Capital Expenditure for that year
(excluding any amount which was carried forward from the previous year) an
amount of such deficit not exceeding one-third of the Budgeted Capital
Expenditure for that year may be added to the Budgeted Capital Expenditure
for the following financial year only (and not otherwise or further),
provided that (x) an amount equal to the amount carried over is expended
on Capital Expenditure within the first 6 months of the following
financial year (and to the extent it is not spent, the amount carried over
shall be reduced) and (y) the maximum amount which can be carried over in
respect of 2001 is L5,000,000 and (ii) Capital Expenditure incurred
in a currency other than Sterling shall be converted into its Sterling
equivalent at the date of expenditure;
5
"CAPITAL EXPENDITURE" means any expenditure which should be treated as
capital expenditure in the audited consolidated financial statements of
the Group in accordance with the Appropriate Accounting Principles;
"CASH COLLATERAL ACCOUNT" means an interest bearing blocked deposit
account in the name of any Borrower opened, or to be opened, with the
Security Agent, the Cash Collateral Account Bank, the Fronting Bank or an
Ancillary Facilities Bank (as the relevant provision of any Finance
Document so provides) pursuant to or otherwise in connection with this
Agreement or any Ancillary Facilities Letter or any other Finance Document
on terms that it (and amounts credited to it) is subject to the Security
Documents;
"CASH COLLATERAL ACCOUNT BANK" means JPMorgan Chase Bank or any
replacement bank selected by the Agent and agreed to by Newco 2 (acting
reasonably);
"CASH EQUIVALENTS" means:
(a) securities denominated in Sterling, US Dollars or euros with
maturities of one year or less from the date of acquisition issued
or fully guaranteed or fully insured by the Government of the United
States of America or any member state of the European Union (or any
agency thereof) which is rated at least AA by Standard & Poor's
Ratings Group or Aa by ▇▇▇▇▇'▇ Investor Service, Inc., or carrying
an equivalent rating by an internationally recognised rating agency
if both the two named rating agencies cease publishing ratings of
investments;
(b) certificates of deposit of, or time deposits or overnight bank
deposits with, any commercial bank meeting the qualifications
specified in paragraph (c) below having maturities of one year or
less from the date of acquisition;
(c) commercial paper of, or money market accounts or funds with or
issued by, an issuer rated at least A-1 by Standard & Poor's Ratings
Group or P-1 by ▇▇▇▇▇'▇ Investors Service, Inc., or carrying an
equivalent rating by an internationally recognised rating agency if
both of the two named rating agencies cease publishing ratings of
investments;
(d) repurchase obligations with a term of not more than 90 days for
underlying securities of the types described in paragraph (a) above
entered into with any bank meeting the qualifications specified in
paragraph (c) above; and
(e) demand deposit accounts maintained in the ordinary course of
business in accordance with clause 10.6(w);
"CAYMAN 1" means HMTF Premier Limited (formerly ▇▇▇▇▇ Limited), a company
incorporated under the laws of the Cayman Islands whose registered office
is at ▇▇▇▇▇▇ House, ▇▇▇▇ Street, PO Box 265 GT, ▇▇▇▇▇▇ Town, Grand Cayman,
Cayman Islands;
"CAYMAN 2" means Premier Co-Investor Limited (formerly ▇▇▇▇▇▇▇▇ Limited),
a company incorporated under the laws of the Cayman Islands whose
6
registered office is at ▇▇▇▇▇▇ House, ▇▇▇▇ Street, PO Box 265 GT, ▇▇▇▇▇▇
Town, Grand Cayman, Cayman Islands;
"CHANGE OF CONTROL" in relation to the Target means at any time (i) ▇▇▇▇▇
Muse, its principals and their affiliates and management ("HMTF") ceasing
to have the power, directly or indirectly, to vote or direct the voting of
shares having a majority of the ordinary voting power for the election of
directors of such company, provided that the occurrence of the foregoing
event shall not be deemed a Change of Control if (a) at any time prior to
the consummation of an initial underwritten public offering of the
ordinary share capital of such company to be listed and/or traded on any
recognised investment exchange or market in any country ("INITIAL PUBLIC
OFFERING"), and for any reason whatever, (x) HMTF (or any of them)
otherwise have the right to designate (and do so designate) a majority of
the board of directors of such company or (y) HMTF and their employees,
directors and officers (the "HMTF GROUP") (or any of them) own legally and
beneficially an amount of the ordinary shares capital of such company
equal to at least 50 per cent. of the percentage of ordinary share capital
of such company owned by the HMTF Group (taken together) legally and
beneficially as at the date the Scheme becomes effective and such
ownership by the HMTF Group represents the largest single block of voting
shares of such company held by any person or persons acting in concert or
(b) at any time after the consummation of an Initial Public Offering, and
for any reason whatever, (x) no person or persons acting in concert,
excluding the HMTF Group, has become the beneficial owner, directly or
indirectly, of more than the greater of (A) 15 per cent. of the shares
then outstanding and (B) the percentage of the then outstanding voting
shares of such company owned beneficially by the HMTF Group (taken
together) and (y) the board of directors of such company shall consist of
a majority of Continuing Directors or (ii) a change of control for the
purposes of the Bridge Facility or the High Yield Bonds, howsoever
defined, occurs.
For the purposes of this definition of "CHANGE OF CONTROL":
"AFFILIATE" as to any person, means any other person which, directly
or indirectly, is in control of, is controlled by, or is under
common control with, such person. For the purposes of this
definition, "control" of a person means the power, directly or
indirectly, either to (i) vote 51 per cent. or more of the shares
(or stock, as applicable) having ordinary voting power for the
election of directors of such person or (ii) direct or cause the
direction of the management and policies of such person, whether by
contract or otherwise; and
"CONTINUING DIRECTORS" means, at any time and in relation to the
Target, any member of the board of directors of such company who (i)
was a member of such board of directors after the date the Scheme
becomes effective (and immediately following any elections or
resignations following the completion of the Acquisition) or (ii)
was nominated for election or elected to such board of directors
with, or whose nomination for election or election to such board of
directors was approved by, the affirmative vote of a majority of the
Continuing Directors who were members of such board of directors at
the time of such nomination or
7
election or (iii) is a designee of HMTF or was nominated by HMTF or
any designees of HMTF on such board of directors;
"CHARGED ASSETS" means any property, assets and/or rights over which
security is granted and/or created under any of the Security Documents;
"CHARGING GROUP" means Newco 2 and those members of the Group which are
Charging Subsidiaries;
"CHARGING SUBSIDIARIES" means the Original Charging Subsidiaries, the UK
Second Purchaser and any other person (other than Newco 2, the Target or
Citadel Insurance Company Limited) which may from time to time enter into
any Security Document in accordance with the requirements of clauses
10.2(f) or 10.8 but in each case only if they have charged all or
substantially all of their assets and undertaking to the Security Agent
for the benefit of the Finance Parties;
"CHEF LICENCE" means the licence of the "Chef" trade ▇▇▇▇ in the agreed
form entered into, or to be entered into, between certain of the Second
Vendors and the Irish Second Purchaser;
"CIRCULAR" means the document dated 8 June 1999 entitled "Increased
Recommended Proposals for the acquisition for cash of all the issued and
to be issued share capital of Hillsdown Holdings Plc" sent to Hillsdown
Shareholders (as defined in such circular);
"CODE" means the City Code on Takeovers and Mergers from time to time;
"COMMITMENT" means, in relation to a Bank, in respect of any Tranche or
Facility at any relevant time, the amount set opposite its name in
relation to the relevant Tranche or (as applicable) Facility in schedule 1
and/or its Ancillary Commitment and/or, in the case of a Substitute, the
amount novated in relation to the relevant Tranche or Facility as
specified in the relevant Substitution Certificate, in any such case, as
adjusted by any relevant term of this Agreement;
"COMMITMENT COMMISSION RATE" means, in respect of:
(a) [not restated]; and
(b) the Working Capital Facility, 0.75 per cent. per annum adjusted in
accordance with paragraph 2 of schedule 8;
"CONSOLIDATED EBITDA" has the meaning given to that term in schedule 8;
"CONSOLIDATED EXCESS CASH FLOW" has the meaning given to that term in
schedule 8;
"CONTINGENT ANCILLARY FACILITIES LIABILITIES" means, in respect of the
Ancillary Facilities Banks or (as the context requires) any one of them at
any relevant time, the aggregate amount (if any) of its (their) maximum
potential liability or risk in respect of its (their) contingent
liabilities outstanding at such time in respect of the Ancillary
Facilities made available to the Ancillary Facilities
8
Borrowers by such Ancillary Facilities Banks and any reference to, or
question as to, the "AMOUNT OF THE CONTINGENT ANCILLARY FACILITIES
LIABILITIES" at any time means the amount of such liabilities at such time
as calculated by the Ancillary Facilities Banks in good faith in
accordance with its (or their respective) usual practices in relation to
ancillary facilities;
"CONTRIBUTION" means, subject to clause 14.2, in relation to a Bank:
(a) the principal amount of any Term Advances and/or the Working Capital
Advances (or, if the context requires, the Sterling Amount of such
Working Capital Advances) owing to such Bank at any relevant time;
and/or
(b) in respect of the Working Capital Facility only, its Relevant
Proportion of the outstanding Letters of Credit attributable to such
Bank at any relevant time; or
if the context requires, the Sterling Amount of the amount of the relevant
Drawing owing to such Bank at the relevant time;
"CREDIT DOCUMENTS" means this Agreement, the Supplemental Agreement, the
Ancillary Facilities Letters, the Fee Letter, the Second Fee Letters, the
BACS Documents,the Hedge Documents and the Intercreditor Agreement;
"DANGEROUS SUBSTANCE" means any radioactive emissions, noise and any
natural or artificial substance (in whatever form) the generation,
transportation, storage, treatment, use or disposal of which (whether
alone or in combination with any other substance) gives rise to a risk of
causing harm to man or any other living organism or damaging the
Environment or public health or welfare, including (without limitation)
any controlled, special, hazardous, toxic, radioactive or dangerous waste;
"DEFAULT" means an Event of Default or an event which, with the giving of
notice, lapse of time or fulfilment of any other applicable condition or
combination of the foregoing (in each case as specified in clause 12.1)
would constitute an Event of Default;
"DEFAULTING BANK" has the meaning given to it in clause 4.16;
"DEMERGER" means the disposal of the Target's furniture and poultry
businesses in accordance with the Structure Paper;
"DEMERGER AGREEMENTS" means in, respect of the furniture business, the
demerger agreement dated 27 July 1999 between Hillsdown International
Limited, HMTF Furniture Holdings Limited, HMTF Furniture Limited,
Furniture Co-Investor Limited and the Target and, in respect of the
poultry business, the demerger agreement dated 27 July 1999 between
Hillsdown International Limited, HMTF Poultry, HMTF Poultry Holdings
Limited and the Target;
"DERIVATIVES TRANSACTION" means a contract, agreement or transaction which
is:
9
(a) a rate swap, basis swap, commodity swap, forward rate transaction,
commodity option, equity (or equity or other index) swap or option,
bond option, interest rate option, foreign exchange transaction,
cap, collar or floor, currency swap, currency option or any other
similar transaction; and/or
(b) any combination of such transactions,
in each case, whether on-exchange or otherwise;
"DOCUMENTATION AGENT" means Bankers Trust Company (or its successor) in
its capacity as documentation agent in respect of the Facilities relating
to the Acquisition;
"DRAWDOWN DATE" means the date on which a Drawing takes place;
"DRAWDOWN NOTICE" means, in respect of a Facility, a notice substantially
in the terms of the relevant part of schedule 2;
"DRAWING" means each drawing by way of an Advance or a Letter of Credit
and each utilisation of Ancillary Facilities made, or to be made, by a
Borrower under the Facilities and, as the context requires, such Advance
so drawn down, or Letter of Credit issued or utilisation so made;
"EBITDA" means in relation to any person, its Consolidated EBITDA measured
as if references in the definition thereof to "Group" means to that person
and its Subsidiaries, if any;
"EFFECTIVE DATE" means the date on which the Scheme becomes effective by
virtue of an appropriate court order approving the Scheme, having been
made and duly filed with the Registrar of Companies (together with an
appropriate minute of reduction of capital) and the satisfaction of all
other conditions to the Scheme's effectiveness;
"ENCUMBRANCE" means any mortgage, pledge, lien, charge, assignment for the
purpose of providing security, hypothecation, right in security, security
interest or trust arrangement for the purpose of providing security, and
any other security agreement or other arrangement having the effect of
providing security (including, without limitation, the deposit of monies
or property with a person with the primary intention of affording such
person a right of set-off or lien);
"ENFORCEMENT DATE" means the date of the first declaration made by the
Agent pursuant to clause 12.2;
"ENVIRONMENT" means all, or any of, the air (including, without
limitation, the air within buildings and the air within other natural or
man-made structures above or below ground), water (including, without
limitation, ground and surface water) and land (including, without
limitation, buildings, surface and sub-surface soil);
"ENVIRONMENTAL CLAIM" means any claim by any person:
10
(a) in respect of any loss or liability suffered or incurred by that
person as a result of or in connection with any violation of
Environmental Law; or
(b) that arises as a result of or in connection with Environmental
Contamination and that could give rise to any remedy or penalty
(whether interim or final) that may be enforced or assessed by
private or public legal action or administrative order or
proceedings;
"ENVIRONMENTAL CONTAMINATION" means each of the following and their
consequences:
(a) any release, discharge, emission, leakage or spillage of any
Dangerous Substance at or from any site owned, occupied or used by
any member of the Group into any part of the Environment; or
(b) any accident, fire, explosion or sudden event at any site owned,
occupied or used by any member of the Group which is directly or
indirectly caused by or attributable to any Dangerous Substance; or
(c) any other pollution of the Environment;
"ENVIRONMENTAL LAW" means all laws (including, without limitation, common
law), regulations, directives, codes of practice, circulars, guidance
notices and the like having legal effect concerning the protection of
human health, the Environment, the conditions of the work place or the
generation, transportation, storage, treatment or disposal of Dangerous
Substances and in the case of codes of practice, circulars, guidance
notices and the like with which it is customary for persons carrying on a
similar business to the Group to comply with;
"ENVIRONMENTAL LICENCE" means any authorisation required by any
Environmental Law;
"EQUITY PERMITTED PAYMENT" means at any time, an amount which is required
by the Target in order, and to the extent necessary, to enable the Target
to pay amounts which are due and payable at such time or no later than the
third Banking Day after such time in respect of:
(a) audit fees, legal expenses and other proper and necessary incidental
expenses and corporate overheads up to a maximum aggregate amount of
L2,500,000 in any financial year;
(b) its Taxes but only to the extent such Taxes are attributable to the
business of the Newco 2 and its Subsidiaries; or
(c) contingent liabilities of the Target which existed as at the
Effective Date which have become actual liabilities of the Target
provided that:
(i) the aggregate amount paid in respect of all such liabilities
shall not exceed L15,000,000; and
(ii) no breach of any of the Financial Covenants would have
occurred on the most recent Financial Covenant test date if
(and assuming that)
11
the payment concerned had been made one day before the most
recent Financial Covenant test date and had been included
within each relevant Financial Covenant test as a deduction to
the consolidated trading profits of the Group in calculating
Consolidated EBITDA for the relevant period;
"EURIBOR" means in relation to a particular period:
(a) the percentage rate per annum which is sponsored by the European
Banking Federation and which appears on Telerate page 248 (or such
other page as may replace such page 248 on such system or on any
other system of the information vendor for the time being designated
by the Federation de l'Union Europeene to be the official collector,
calculator and distributor of the Euro Interbank Offered Rate); or
(b) if no such rate appears on the Telerate Screen, the arithmetic mean
(rounded upward, if necessary, to the nearest four decimal places)
of the rates per annum, as supplied to the Agent at its request,
quoted by the EURIBOR Reference Banks to leading banks in the
Interbank Market of any Participating Member State(s),
at or about 11.00 am Central European Time on the Quotation Date of such
period for the offering of deposits in the relevant Optional Currency in
an amount approximately equal to the amount in relation to which EURIBOR
is to be determined for a period equivalent to such period;
"EURIBOR REFERENCE BANKS" means the principal London offices of JPMorgan
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ N.A. and/or any other Banks
appointed as such pursuant to clause 17.14;
"EURO" means the single currency of participating Member States of the
European Union;
"EVENT OF DEFAULT" means any of the events or circumstances described in
clause 12.1;
"FACILITIES" means any or all (as the context requires) of the Term
Facilities and the Working Capital Facility (which, for the avoidance of
doubt, includes the Ancillary Facilities within it);
"FACILITY A" means the facility granted by clause 2.1(a) or (as the case
may be) the amount of that facility as determined in accordance with that
clause;
"FACILITY A ADVANCE" means each borrowing under either Tranche of Facility
A under this Agreement or (as the case may be) the principal amount of
that borrowing outstanding at any relevant time;
"FACILITY A BANK" means each person whose name is set out in the relevant
part of schedule 1 as a Facility A Bank or which assumes rights and
obligations in respect of Facility A pursuant to a Substitution
Certificate provided that upon (i) termination in full of all the
Commitments of any Facility A Bank, and (ii) irrevocable payment in full
of all amounts which may be or become payable to
12
such Facility A Bank under the Finance Documents, such Bank shall not be
regarded as being a Facility A Bank for the purposes of determining
whether any provision of any of the Finance Documents requiring
consultation with or the consent or approval of or instructions from the
Banks or the Majority Banks has been complied with;
"FACILITY A LIMIT" means L244,322,042;
"FACILITY A TRANCHE 1" has the meaning given to that term in clause
2.1(a)(i);
"FACILITY A TRANCHE 2" has the meaning given to that term in clause
2.1(a)(ii);
"FACILITY B" means the facility granted by clause 2.1(b) or (as the case
may be) the amount of that facility as determined in accordance with that
clause;
"FACILITY B ADVANCE" means each borrowing under either Tranche of Facility
B under this Agreement or (as the case may be) the principal amount of
that borrowing outstanding at any relevant time;
"FACILITY B BANK" means each person whose name is set out in the relevant
part of schedule 1 as a Facility B Bank or which assumes rights and
obligations in respect of Facility B pursuant to a Substitution
Certificate provided that upon (i) termination in full of all the
Commitments of any Facility B Bank, and (ii) irrevocable payment in full
of all amounts which may be or become payable to such Facility B Bank
under the Finance Documents, such Bank shall not be regarded as being a
Facility B Bank for the purposes of determining whether any provision of
any of the Finance Documents requiring consultation with or the consent or
approval of or instructions from the Banks or the Majority Banks has been
complied with;
"FACILITY B LIMIT" means L67,977,958;
"FACILITY B TRANCHE 1" has the meaning given to that term in clause
2.1(b)(i);
"FACILITY B TRANCHE 2" has the meaning given to that term in clause
2.1(b)(ii);
"FEE LETTER" means the letter dated on or about 10 August 1999 between
Newco 2, the Agent and the Original Arrangers;
"FINANCE DOCUMENTS" means the Credit Documents and the Security Documents
and any other documents which the Agent and Newco 2 agree shall be Finance
Documents;
"FINANCE LEASE" means any lease under which a member of the Group is the
lessee which is or should be treated as a finance lease under the
Appropriate Accounting Principles (and includes any hire purchase contract
or other arrangement which is or should be similarly treated);
"FINANCE PARTIES" means the Agent, the Arrangers, the Underwriters, the
Banks, the Ancillary Facilities Banks, the Fronting Bank, the Hedge
Counterparties, the Documentation Agent and the Security Agent and (as the
context requires) "FINANCE PARTY" means any one of them;
13
"FINANCE PERIOD" means the period from 10 August 1999 until the date on
which the Agent confirms that none of the Finance Parties and none of the
members of the Group has any actual or contingent liabilities or
obligations under any of the Finance Documents;
"FINANCIAL COVENANTS" means the financial undertakings set out in clause
10.3 and schedule 8;
"FINANCIAL DEFINITIONS" means the definitions set out in schedule 8,
Capital Expenditure, Borrowed Money, Finance Leases, Net Proceeds,
unapplied Net Proceeds (as defined in clause 6.10) and Taxes;
"FINANCIAL MODEL" means the agreed form financial model for the Group
delivered to the Agent pursuant to clause 6 of the Supplemental Agreement;
"FLOTATION" means the inclusion of any part of the share capital of any
Acquisition Party, any Borrower, the Target or any member of the Group in
the Official List of the UK Listing Authority or the grant of permission
to deal in the same in the Alternative Investment Market or the European
Association of Securities Dealers Automated Quotation or on any recognised
investment exchange (as that term is used in the Financial Services and
Markets Act 2000) or in or on any exchange or recognised market replacing
the same or on any other exchange or recognised market in any country;
"FRONTING BANK" means JPMorgan Chase Bank or such alternative Working
Capital Bank as may have agreed in writing with Newco 2 and the Agent to
issue any Letter of Credit in accordance with the provisions of this
Agreement;
"FULL PREPAYMENT EVENT" means either (a) a Change of Control or (b) an
Asset Sale;
"FUNDING COST" means (i) in respect of Advances made, or to be made, in
euros or in a National Currency Unit, EURIBOR or (ii) in respect of
Advances made, or to be made, in any other Optional Currency or Sterling,
LIBOR;
"GOVERNMENT ENTITY" means and includes (whether having a distinct legal
personality or not) any supra-national, national or local government
authority, central bank, board, commission, department, division, organ,
instrumentality, court or agency and any association, organisation or
institution of which any of the foregoing is a member or to whose
jurisdiction any of the foregoing is subject or in whose activities any of
the foregoing is a participant and (if the context requires) which, in
relation to Environmental Matters, has regulatory or administrative
authority under Environmental Law;
"GROUP" means Newco 2 and all its Subsidiaries for the time being, and
"MEMBER OF THE GROUP" means any one of them;
"GROUP DEBENTURE" means the guarantee and debenture dated 10 August 1999
entered into by Newco 2, the Target and the Original Charging Subsidiaries
in favour of the Security Agent;
14
"HEDGE COUNTERPARTIES" means such persons (subject to clause 16.6, each
being a Bank) which shall at any relevant time be party to any Hedge
Transactions and which have acceded to the Intercreditor Agreement in such
capacity;
"HEDGE DOCUMENTS" means the documents evidencing the Hedge Transactions;
"HEDGE TRANSACTIONS" means the arrangements to be entered into between
Newco 2 and the Hedge Counterparties pursuant to clause 10.5(a)(i);
"HEDGING STRATEGY LETTER" means the letter from Newco 2 to the Agent dated
12 August 1999 (as amended and restated) relating to hedging;
"▇▇▇▇▇ MUSE" means Hicks, Muse, ▇▇▇▇ & ▇▇▇▇▇ Limited, a company
incorporated under the laws of England and Wales with its registered
office at ▇-▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"HIGH YIELD BONDS" means (i) the 121/4 % Sterling senior notes due 2009
and (ii) the 12% US Dollar senior notes due 2009, in each case issued by
Newco 1;
"HIGH YIELD BOND DOCUMENTS" means the senior note indenture, the note
depository agreement, the exchange and registration rights agreement, the
high yield bonds, any exchange notes contemplated by the senior note
indenture or the exchange and registration rights agreement, the
engagement letter, the fees letter, indemnity letters, underwriting or
purchase agreement and all other documents relating to the issuance of the
High Yield Bonds from time to time;
"HMTF GROUP" has the meaning given to that term in the definition of
"Change of Control" in this clause 1.1;
"HMTF POULTRY" means HMTF Poultry Limited (company number 3808291) whose
registered office is at ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"HMTF POULTRY/NEWCO 2 SUBORDINATION DEED" means the agreed form
subordination deed entered into between HMTF Poultry, Newco 2 and the
Security Agent;
"HOLDING COMPANY" means an entity of which another person is a Subsidiary;
"INDEBTEDNESS" means any obligation for the payment or repayment of money,
whether as principal or as surety and whether present or future, actual or
contingent;
"INFORMATION MEMORANDA" means documents which have been or are to be
distributed to Banks or prospective Banks by any of the Arrangers in
connection with the sub-underwriting or general syndication of the
Facilities or any Tranche or the transaction contemplated by the
Supplemental Agreement;
"INFORMATION PACKAGE" means the Information Memoranda, the Reports and the
Financial Model;
15
"INTELLECTUAL PROPERTY RIGHTS" means all copyrights (including rights in
computer software), trade marks, service marks, business names, patents,
rights in inventions, registered designs, design rights, database rights
and topographical or similar rights, rights in trade secrets or other
confidential information and any other intellectual property rights and
any interests (including by way of licence) in any of the foregoing (in
each case whether registered or not and including all applications for the
same) which may subsist anywhere in the world;
"INTERCOMPANY LOAN AGREEMENT" means the loan agreement dated 10 August
1999 entered into by Newco 1 and Newco 2 setting out the terms on which
Newco 1 has lent to Newco 2 the net proceeds of the High Yield Bonds;
"INTERCOMPANY LOAN PERMITTED PAYMENT" has the meaning given to that term
in the Intercompany Loan Subordination Deed;
"INTERCOMPANY LOAN SUBORDINATION DEED" means the subordination deed dated
10 August 1999 entered into between Newco 1, Newco 2 and the Security
Agent;
"INTERCREDITOR AGREEMENT" means the intercreditor agreement entered into,
or to be entered into, between the Finance Parties, the Senior
Subordinated Finance Parties and Newco 2;
"INTEREST PAYMENT DATE" means the last day of an Interest Period;
"INTEREST PERIOD" means, in relation to any Term Advance, each period for
the calculation of interest in respect of such Term Advance ascertained in
accordance with clause 5.1;
"INVESTORS' UNDERTAKING" means an undertaking in the agreed form granted
by each of Cayman 1, Newco 1 and the Target in favour of the Security
Agent;
"IRISH IPR AGREEMENT" means the agreement for the sale of certain
Intellectual Property Rights in Ireland in the agreed form entered into,
or to be entered into, between certain of the Second Vendors and the Irish
Second Purchaser;
"IRISH SECOND ACQUISITION" means the acquisition by the Irish Second
Purchaser of the Ireland ambient food business of Nestle (Ireland) Limited
pursuant to the Irish Second Acquisition Agreements;
"IRISH SECOND ACQUISITION AGREEMENTS" means:
(a) the Second SPA;
(b) the Irish IPR Agreement;
(c) the Chef Licence; and
(d) all other documents delivered pursuant or in relation to any of (a)
to (c) (inclusive) above (including, without limitation, the
transitional services agreement in the agreed form entered into, or
to be entered into, between
16
certain of the Second Vendors and the Second Purchasers in
connection with the Irish Second Acquisition);
"IRISH SECOND ACQUISITION COMPLETION DATE" means the date (which shall be
a Banking Day) on which the Irish Second Acquisition is duly effected by
the completion of the Irish Second Acquisition Agreements;
"IRISH SECOND PURCHASER" means Pastam Limited (registered in Ireland with
company number 323282) whose registered office is at c/o ▇▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇ ▇▇▇ Building, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇;
"JONKER FRIS SECURITY DOCUMENTS" means a pledge of stock and receivables
and a guarantee in each case in the agreed form entered into, or to be
entered into, by Jonker Fris B.V. in favour of the Security Agent;
"LEGAL DUE DILIGENCE REPORT" means the agreed form report dated on or
about the date of this Agreement prepared by Weil, Gotshal & ▇▇▇▇▇▇
addressed to the Security Agent on behalf of the Finance Parties;
"LEGAL OPINIONS" means the legal opinions delivered pursuant to clause 3,
clause 10.2(f) or pursuant to the Supplemental Agreement in form and
substance satisfactory to the Agent (acting reasonably);
"LETTER OF CREDIT" means a letter of credit, bond, guarantee or other
undertaking issued or to be issued by the Fronting Bank pursuant to the
terms and subject to the conditions of this Agreement in such form as may
be requested by a Working Capital Borrower and is acceptable to the
Fronting Bank and the Agent (acting reasonably);
"LIBOR" means, in relation to a particular period, the rate for deposits
of the relevant currency for a period equivalent to such period at or
about 11 a.m. on the Quotation Date for such period as displayed on
Telerate page 3750 (or, as the case may be, 3740) (British Bankers'
Association Interest Settlement Rates) (or such other page as may replace
such page 3750 (or, as the case may be, 3740) on such system or on any
other system of the information vendor for the time being designated by
the British Bankers' Association to calculate the BBA Interest Settlement
Rate (as defined in the British Bankers' Association's Recommended Terms
and Conditions ("BBAIRS" terms) dated August, 1985)), provided that if on
such date no such rate is so displayed, LIBOR for such period shall be the
arithmetic mean (rounded upward if necessary to five decimal places) of
the rates respectively quoted to the Agent by each of the LIBOR Reference
Banks at the request of the Agent as such LIBOR Reference Bank's offered
rate for deposits of the relevant currency in an amount approximately
equal to the amount in relation to which LIBOR is to be determined for a
period equivalent to such period to leading banks in the London Interbank
Market at or about 11 a.m. on the Quotation Date for such period;
"LIBOR REFERENCE BANKS" means the principal London offices of JPMorgan
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ N.A. and/or any other Banks
appointed as such pursuant to clause 17.14;
17
"LOAN NOTE INSTRUMENT" means the instrument in the agreed form dated on or
about the Second Effective Date constituting up to L164,656,894
unsecured loan notes due 2017 of Premier Foods Investments Limited;
"MAJORITY BANKS" means at any relevant time Banks the aggregate of whose
Commitments in respect of the Facilities exceeds 662/3 per cent. of the
Total Commitments in respect of the Facilities but so that (i) if at such
time the Total Commitments in respect of any Tranche or Facility have been
reduced to zero references to a Bank's Commitment in relation to such
Tranche or Facility shall be construed as amongst the Finance Parties (and
not so as to give any rights to any other person) as a reference to that
Bank's Commitment in relation to such Tranche or (as applicable) Facility
immediately prior to such reduction to zero and (ii) in the context of a
particular Facility (rather than the Facilities as a whole) references to
the "Majority Banks" shall be construed so as to relate only to Banks with
Commitments in respect of that Facility;
"MARGIN" means, in respect of:
(a) Facility A, 2.25 per cent. per annum, adjusted in accordance with
paragraph 2 of schedule 8;
(b) Facility B, 2.75 per cent. per annum; and
(c) the Working Capital Facility, 2.25 per cent. per annum, adjusted in
accordance with paragraph 2 of schedule 8;
"MATERIAL ADVERSE EFFECT" means any effect, event or circumstance which
(on its own or in combination with other effects, events or circumstances)
has, or is reasonably likely to have, a material adverse effect on (i) the
business, assets, property, condition (financial or otherwise) or
prospects of the Group taken as a whole or (ii) the validity or
enforceability of any of the Finance Documents or the rights or remedies
of the Finance Parties thereunder;
"MATERIAL ENTITY" means:
(a) each Obligor;
(b) each Acquisition Party; and
(c) each member of the Group:
(i) whose EBITDA constitutes 5 per cent. or more of the
Consolidated EBITDA of the Group, as shown by the most recent
audited financial statements (consolidated where applicable)
of that member of the Group and the Group (respectively); or
(ii) whose turnover (consolidated with the turnover of its
Subsidiaries, if any) constitutes 5 per cent. or more of
consolidated turnover of the Group, as shown by the most
recent audited financial statements (consolidated where
applicable) of that member of the Group and the Group
(respectively); or
18
(iii) whose total assets (consolidated with the total assets of its
Subsidiaries, if any) constitute 5 per cent. or more of
consolidated total assets of the Group taken as a whole, as
shown by the most recent audited financial statements
(consolidated where applicable) of that member of the Group
and the Group (respectively); or
(iv) to which has been transferred (whether by one transaction or a
series of transactions, related or not) all or substantially
all of the assets of another member of the Group which,
immediately prior to that transaction or any of the
transactions in that series, was a Material Entity as
determined under paragraphs (i), (ii) or (iii) above; or
(v) which is a Holding Company of any Obligor or any Material
Entity determined under paragraphs (i) to (iv) above;
"MATURITY DATE" means, in relation to any Working Capital Advance, the
last day of the period for which that Working Capital Advance is drawn
down;
"MATURITY PERIOD" means, in relation to any Working Capital Advance, the
period beginning on its Drawdown Date and ending on its Maturity Date
(provided that no Maturity Period shall extend beyond the Termination
Date);
"MONTH" or "MONTHS" means (a) (save as referred to in (b) below) a period
beginning in one calendar month and ending in the relevant later calendar
month on the day numerically corresponding to the day of the calendar
month in which it started, provided that (i) if the period started on the
last Banking Day in a calendar month or if there is no such numerically
corresponding day, it shall end on the last Banking Day in such later
calendar month and (ii) if such numerically corresponding day is not a
Banking Day, the period shall end on the next following Banking Day in
such later calendar month but if there is no such Banking Day it shall end
on the preceding Banking Day and "MONTHLY" shall be construed accordingly;
and (b) in the context of financial reporting, periods of four or five
weeks by reference to which monthly management accounts are prepared;
"NATIONAL CURRENCY UNIT" means the unit of currency (other than a euro
unit) of a Participating Member State;
"NET DERIVATIVES LIABILITY" means, at any time, the net liability (if any)
at such time of Newco 2 and the other members of the Group taken as a
whole in respect of Derivatives Transactions determined by reference to
the amounts (as determined by the Agent) which would be payable or
receivable by Newco 2 and the other members of the Group pursuant to the
terms of such Derivatives Transactions if such Derivatives Transactions
were terminated at such time;
"NET PROCEEDS" means, in respect of a disposal of an asset, the full
amount of cash proceeds and Cash Equivalents realised on such disposal
(including any such proceeds realised by way of deferred payment or
instalment receivable or purchase price adjustment receivable or
otherwise, but only as and when received) less the costs of such disposal
for which purpose (a) such proceeds not in Sterling shall be deemed to be
their Sterling equivalent at the date of the
19
relevant disposal and (b) "costs of disposal" includes legal fees, agents'
commissions, auditors' and accountants' fees, bankers' fees, registration
fees and other customary fees and expenses, reasonable provisions for Tax
payable (after taking into account any available Tax credits or deductions
and any Tax sharing arrangements), and any amount of such proceeds used to
repay any Indebtedness secured on the relevant asset and any purchase
price adjustments reasonably expected to be payable in connection with any
such disposal;
"NEW ARTICLES" means the new articles of association of Newco 2 in the
agreed form;
"NEW TARGET ARTICLES" means the new articles of association of the Target
in the agreed form to be adopted pursuant to the Scheme and which provide
that no dividend may be paid on, nor any distribution made in respect of,
nor any return of capital paid on any of the Target Ordinary Shares if
this would constitute a breach of any Finance Document or the Bridge
Facility Agreement or the High Yield Bond Documents;
"NEWCO 1" means Premier International Foods plc (formerly Queensbury
Finance plc), company number 3771991, whose registered office is at ▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"NEWCO 2" means Premier Financing Limited (formerly Crescent Acquisition
Limited), company number 3716362, whose registered office is at ▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"NON-UK RESIDENT SUBSIDIARY" means any wholly-owned Subsidiary of Newco 2
other than a Subsidiary which is a UK resident Subsidiary;
"OBLIGORS" means the Borrowers, the Target, the Irish Second Purchaser and
the members of the Charging Group and "OBLIGOR" means any of them;
"OPTIONAL CURRENCY" means any currency, other than Sterling, which is
freely transferable, freely convertible into Sterling and dealt in a
London Interbank Market;
"ORIGINAL ARRANGERS" means ▇.▇. ▇▇▇▇▇▇ plc of ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇, Deutsche Banc Alex. ▇▇▇▇▇ Incorporated of ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇ (or its successor) and Salomon Brothers International Limited of
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇;
"ORIGINAL CHARGING SUBSIDIARY" means each member of the Group listed as
such in schedule 6;
"ORIGINAL TRANCHES" means Facility A Tranche 1 and Facility B Tranche 1;
"ORIGINAL UNDERWRITERS" means JPMorgan Chase Bank of ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇, Bankers Trust Company of ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇ (or its successor) and Citibank N.A. of ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇;
20
"PARTICIPATING MEMBER STATE" means a member state of the European Union
that has adopted or adopts the single currency in accordance with the
Treaty;
"PERMITTED ACQUISITIONS" has the meaning ascribed thereto in clause
10.6(s);
"PERMITTED ENCUMBRANCE" means an Encumbrance being any of the following,
namely:
(a) title retention arrangements arising in the ordinary course of the
relevant member of the Group's business as carried on by it at the
date of this Agreement or (if later) the date it becomes a member of
the Group;
(b) any Encumbrance arising by operation of law (not by contract or
otherwise) including, without limitation, banker's liens or rights
of set-off and liens arising in the ordinary course of the relevant
member of the Group's business as carried on by it at the date of
this Agreement or (if later) the date it becomes a member of the
Group, so long as any amounts in respect of which such liens or
rights of set-off arise are not more than 60 days overdue for
payment or are being contested in good faith by appropriate
proceedings;
(c) any Encumbrance created by any of the Security Documents or
(provided that a first ranking Encumbrance over the same asset is
created by a Security Document) in favour of the Senior Subordinated
Finance Parties;
(d) any Encumbrance created or existing with the prior written consent
of the Agent acting on the instructions of the Majority Banks;
(e) any Encumbrance constituted by any Finance Lease permitted under
clause 10.6(c)(viii);
(f) [Not restated];
(g) any Encumbrances for Taxes which are being contested in good faith
by appropriate proceedings, provided that adequate reserves with
respect to such contested Taxes are maintained on the books of the
appropriate members of the Group in conformity with the Appropriate
Accounting Principles;
(h) [Not restated];
(i) [Not restated];
(j) Encumbrances securing Borrowed Money permitted by clause
10.6(c)(vii) provided that (i) any such Encumbrance is not extended
to cover any other property or assets upon or following consummation
of such Permitted Acquisition and (ii) the amount of Borrowed Money
secured thereby is not increased other than pursuant to the
instrument under which such Encumbrance was created, which
instrument shall not be amended so as to increase the amount of
Borrowed Money secured thereby at any time after such acquisition;
21
(k) deposits to secure the performance of bids, trade contracts (other
than for Borrowed Money), leases, Intellectual Property Rights,
statutory obligations, insurance contracts, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in
the ordinary course of business;
(l) Encumbrances securing Borrowed Money of any member of the Group
incurred to finance the acquisition of fixed or capital assets
(provided that (i) such Encumbrances shall be created substantially
simultaneously with the acquisition of such fixed or capital assets,
(ii) such Encumbrances do not at any time encumber any assets other
than the assets financed by such Borrowed Money and (iii) the amount
of Borrowed Money secured thereby is not increased);
(m) Encumbrances securing Borrowed Money existing on any property or
assets at the time of its acquisition by a member of the Group or
existing on such property or assets of any person that becomes a
member of the Group after the date hereof at time such person
becomes a member of the Group (other than any such Encumbrance
created in contemplation of such acquisition) provided that (i) the
Borrowed Money secured thereby is Borrowed Money of, or is assumed
by, the relevant acquiring member of the Group, (ii) no such
Encumbrance is extended to cover any additional property or assets
and (iii) the amount of Borrowed Money secured thereby is not
increased other than pursuant to the instrument under which such
Encumbrance was created, which instrument shall not be amended so as
to increase the amount of Borrowed Money secured thereby at any time
after such acquisition;
(n) Encumbrances on the property of any member of the Group in favour of
the landlord of such property securing licences, subleases or leases
permitted hereunder;
(o) attachment or judgment Encumbrances not constituting an Event of
Default;
(p) Encumbrances not otherwise permitted hereunder so long as neither
(i) the aggregate Indebtedness secured thereby nor (ii) the
aggregate fair market value (as at the date the relevant Encumbrance
is created) of the assets subject thereto exceeds L3,000,000
at any time; and
(q) (to the extent only that clause 4.5.(a)(v) is complied with) any
Encumbrance in favour of an Ancillary Facilities Bank over credit
balances on bank accounts of Obligors with such Ancillary Facilities
Bank created in order to facilitate the operation of such bank
accounts on a net balance basis for the purpose of calculating the
outstanding Drawings by way of overdraft under the Ancillary
Facilities provided by such Ancillary Facilities Bank, with credit
balances and debt balances on the various accounts being netted off;
22
"POOLING MEMORANDA" means the memoranda in favour of National Westminster
Bank plc, Lloyds TSB Bank Plc and Barclays Bank PLC entered into, or to be
entered into from time to time, by Working Capital Borrowers;
"PRESS RELEASE" means the press release announcing the Acquisition
Parties' firm intention to propose the Scheme;
"PUSHDOWN" means the completion of all of the following transactions with
no payments of cash being made:
(a) Newco 1 (and therefore indirectly Newco 2) is contributed by Cayman
1 to the Target as a gift;
(b) Newco 1 and Newco 2 acquire all the existing Subsidiaries of the
Target (other than Citadel Insurance Company and ▇.▇. ▇▇▇▇▇ & Co.
Limited) in exchange in part for the issue of shares in Newco 1 to
the Target and in part for the cancellation of the Target Preference
Shares held by Newco 2; and
(c) Newco 2 acquires all the shares in the Subsidiaries of Newco 1
(other than the shares in Newco 2) in exchange for the issue of
shares in Newco 2 to Newco 1;
"QUALIFYING BANK" means a person which on any date on which interest is
payable under this Agreement is beneficially entitled to the interest
payable to it under this Agreement and is:
(a) in relation to any Drawing made available to a person resident in
the United Kingdom, a UK Lender or a Treaty Lender; or
(b) in relation to any Drawing made available to any other person, any
person;
"QUALIFYING NON-UK RESIDENT SUBSIDIARY" at any time, means a Non-UK
resident Subsidiary which is either:
(a) resident (as such term is defined in the appropriate double taxation
treaty) in a country ("THE COUNTRY OF RESIDENCE OF THE QUALIFYING
NON-UK RESIDENT SUBSIDIARY") with which:
(i) the United Kingdom; and
(ii) each country in which the Finance Parties at that time are
resident (as such term is defined in the double taxation
treaty between that country and the Country of Residence of
the Qualifying Non-UK resident Subsidiary);
has a double taxation treaty giving residents of those countries complete
exemption from the imposition of any withholding or deduction for or on
account of Taxes of the Country of Residence of the Qualifying Non-UK
resident Subsidiary on interest (whether or not the Finance Parties carry
on business in the Country of Residence of the Qualifying Non-UK resident
Subsidiary through a permanent establishment with which the Indebtedness
23
under a Finance Document in respect of which the interest is paid is
connected); or
(b) resident in a country for the purposes of Taxation in that country
which does not at that time impose any withholding or deduction for
or on account of Taxes on payments of interest by residents of that
country;
and in each case not resident or otherwise liable to Taxation in any other
country for the purposes of Taxation in that country;
"QUARTER" means, in respect of each financial year, each of the periods
(each comprising three successive months) ending on or about 31 March, 30
June, 30 September and 31 December in such financial year;
"QUOTATION DATE" means, in relation to an Interest Period, Maturity Period
or other period for which EURIBOR or LIBOR is to be determined, in the
case of a determination of EURIBOR, the second Banking Day before the
first day of such period and, in the case of a determination of LIBOR, the
date on which quotations would customarily be provided by leading banks in
the London Interbank Market for deposits in the relevant currency for
delivery on the first day of that Interest Period, Maturity Period or
other period provided that, if for any such period quotations would
customarily be given on more than one date, the Quotation Date for that
period shall be the last of those dates;
"RECOVERING BANK" has the meaning given to that term in clause 15.2;
"REFERENCE BANKS" means the LIBOR Reference Banks and/or the EURIBOR
Reference Banks, as the context may require;
"RELEVANT LIABILITIES" means, at any time, the aggregate of the amounts
drawn under, and all other amounts owing under or in respect of, the
Target Group's loan facilities on the date of the first Term Advance (such
loan facilities being set out in detail in part A of schedule 13 of this
Agreement in its original form);
"RELEVANT PROPORTION" means, in relation to a Working Capital Bank and the
outstanding Letters of Credit at any relevant time, the proportion which
that Working Capital Bank's Commitment in respect of the Working Capital
Facility at the time of the issue of such Letters of Credit bears to the
Total Commitments in respect of the Working Capital Facility at such time,
but so that if at such time such Working Capital Bank's Commitment in
respect of the Working Capital Facility has been reduced pursuant to
clause 6.5 or 14.1 then as amongst the Finance Parties (but not so as to
give any rights to any other person and for the purpose of this definition
only) such Working Capital Bank's Commitment in respect of the Working
Capital Facility shall not be deemed to have been reduced to the extent
that the relevant Borrower does not discharge the outstanding Letters of
Credit representing such Working Capital Bank's Commitment in respect of
the Working Capital Facility;
"REPAYMENT DATES" means, in relation to the Term Advances, each of the
dates on which repayment instalments in respect of the Term Advances are
due under clause 6.1;
24
"REPORTS" means the Accountants' Report, the further report dated July
1999 compiled by PricewaterhouseCoopers and addressed to the Finance
Parties, the Legal Due Diligence Report and the Second Reports;
"ROWNTREES LICENCE" means the licence of the "Rowntrees" trade ▇▇▇▇ in the
agreed form entered into, or to be entered into, between certain of the
Second Vendors and the UK Second Purchaser;
"SCHEME" means a scheme of arrangement in respect of the Target which is
in accordance with the Structure Paper and pursuant to which Newco 2
subscribes in cash for all of the Target Preference Shares in conjunction
with the Target cancelling all of its share capital existing immediately
prior to such scheme of arrangement becoming effective and Cayman 1 and
Cayman 2 subscribing in cash for all of the ordinary shares in the Target;
"SCHEME DOCUMENTS" means the Circular and each of the other documents
issued, or to be issued, by or on behalf of the Target to its shareholders
in respect of the Scheme;
"SECOND ACQUISITIONS" means the UK Second Acquisition and the Irish Second
Acquisition;
"SECOND ACQUISITIONS AGREEMENTS" means the UK Second Acquisition
Agreements and the Irish Second Acquisition Agreements and "SECOND
ACQUISITIONS AGREEMENT" means any one of them;
"SECOND ACQUISITIONS PURPOSES" means any of the following purposes:
(a) to make payments of the consideration due under the Second
Acquisitions Agreements; and
(b) to make payment due of the costs, expenses and Taxes of Newco 2 and
the Second Purchasers incurred in connection with the Second
Acquisitions;
"SECOND EFFECTIVE DATE" has the meaning given to the term "Effective Date"
in the Supplemental Agreement;
"SECOND FEE LETTERS" means the fee letters dated 3 May 2002 between Newco
2 and the Agent and between Newco 2, the Amendment Arrangers and the
Amendment Underwriters;
"SECOND PURCHASERS" means the UK Second Purchaser and the Irish Second
Purchaser and "SECOND PURCHASER" means any one of them;
"SECOND REPORTS" means the reports in the agreed form compiled or to be
compiled by PricewaterhouseCoopers, KPMG, ERM and Weil, Gotshal & ▇▇▇▇▇▇,
in each case in connection with the Second Acquisitions and addressed to
the Finance Parties (or the Security Agent on their behalf);
"SECOND SPA" means the sale and purchase agreement (together with its
schedules) in the agreed form dated 3 May 2002 between the Second
Purchasers, Newco 2 and the Second Vendors relating to the Second
Acquisitions;
25
"SECOND SUPPLEMENTAL DEBENTURE" means the deed in the agreed form
supplemental to the Group Debenture entered into by the Second Purchasers,
Horberry & ▇▇▇▇▇ Limited and Hillsdown International B.V. in favour of the
Security Agent;
"SECOND SYNDICATION COMPLETION DATE" means the date which is the earlier
of (i) the date falling 120 days after the date of the Supplemental
Agreement (such period to be increased by a day for each day during which
any proceedings, investigation, examination or enquiry in respect of any
part of the Second Acquisitions are initiated or are ongoing by any
competition authority) and (ii) the date on which the Amendment Arrangers
declare that the syndication has successfully completed;
"SECOND TRANCHES" means Facility A Tranche 2 and Facility B Tranche 2;
"SECOND TRANSACTION DOCUMENTS" means the Second Acquisitions Agreements,
the Loan Note Instrument and the other documents in the agreed form which
implement the recapitalisation and other steps set out in the agreed form
structure paper referred to in paragraph 8.1 of schedule 4 to the
Supplemental Agreement;
"SECOND VENDORS" means Nestle UK Limited, Nestle (Ireland) Limited and
Nestle S.A. and any of their Affiliates which are party to any of the
Second Acquisitions Agreements;
"SECURITY AGENT" means ▇.▇. ▇▇▇▇▇▇ Europe Limited (formerly Chase
Manhattan International Limited) of ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ or
such other person as may be appointed security agent and trustee for the
Finance Parties pursuant to clause 17.13 and, in each case, its successors
in title;
"SECURITY DOCUMENTS" means, at any time, those of the following documents
which have been executed (or purported to have been executed) by all
parties thereto and have not been discharged or released at such time: (i)
the Group Debenture, (ii) the Target Group Share Pledges, (iii) the
Subordination Deeds, (iv) the Bond and Floating Charges, (v) the Standard
Securities, (vi) the Investors' Undertaking, (vii) the Jonker Fris
Security Documents, (viii) the Voting Undertaking, (ix) the Second
Supplemental Debenture,(x) any and all other Encumbrances (including,
without limitation, the Pooling Memoranda), guarantees and other
instruments from time to time entered into by any member of the Group by
way of guarantee and/or security in respect of amounts owed to the Finance
Parties under this Agreement (whether or not also in respect of any other
Indebtedness);
"SENIOR SUBORDINATED FACILITY" means the Facility (as defined in the
Senior Subordinated Facility Agreement);
"SENIOR SUBORDINATED FACILITY ADVANCES" means the Advances (as defined in
the Senior Subordinated Facility Agreement);
"SENIOR SUBORDINATED FACILITY AGREEMENT" has the meaning given to that
term in the Intercreditor Agreement;
26
"SENIOR SUBORDINATED FINANCE DOCUMENTS" means the Finance Documents (as
defined in the Senior Subordinated Facility Agreement);
"SENIOR SUBORDINATED FINANCE PARTIES" has the meaning given to that term
in the Intercreditor Agreement;
"SHAREHOLDER INJECTIONS" means:
(a) in respect of Newco 2, the making of Subordinated Shareholder Loans
to it and the subscription by Newco 1 for shares in Newco 2 in
accordance with clause 10.6(m); and
(b) in respect of any other Acquisition Party, the issuing of shares or
loan notes by such Acquisition Party to its shareholders for cash
and the borrowing of cash by such Acquisition Party from its
shareholders, in each case in a manner and on terms and conditions
not resulting in a Default provided that the proceeds of such
issuance or borrowing are, in a manner and on terms and conditions
not resulting in a Default, directly or indirectly invested by such
Acquisition Party in Newco 2 in the manner referred to in (a) above;
"STANDARD SECURITIES" means the standard securities in the agreed form
entered into, or to be entered into, by members of the Group over
properties situate at (i) Orchard Loan, Lochside, Forfar, Tayside and (ii)
Blocks 10 and ▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ (in
each case) in favour of the Security Agent;
"STERLING" and "(POUND)" mean the lawful currency for the time being of
the United Kingdom and in respect of all payments to be made under this
Agreement in Sterling mean immediately available, freely transferable
cleared funds;
"STERLING AMOUNT" means (a) in relation to a Drawing to be made in
Sterling the amount in Sterling so drawn down, (b) in relation to a
Drawing under the Working Capital Facility which has been or is to be
drawn down in an Optional Currency, the amount in Sterling which was or
would be required to purchase the principal amount of that Drawing at or
prior to the Drawdown Date as determined in accordance with clause
4.17(c), in each case as reduced by any repayment or prepayment under this
Agreement;
"STRUCTURE PAPER" means the structure paper dated 9 August 1999 in the
agreed form which sets out the structure of, and the steps involved in,
the acquisition of the Target pursuant to the Scheme and the refinancing
of the Relevant Liabilities of the Target and its Subsidiaries;
"SUBORDINATED SHAREHOLDER LOANS" means subordinated loans lent by UK
Topco, the Target, Newco 1 or HMTF Poultry and borrowed by Newco 2 other
than under the Intercompany Loan Agreement or the Target/Newco 2 Loan
Agreement), which loans do not bear cash interest, cannot be repaid during
the Finance Period and are otherwise fully subordinated to the obligations
of the Obligors under the Finance Documents on terms satisfactory to the
Agent and where copies (certified by a director or the secretary of Newco
2 as true,
27
complete and up-to-date copies) of the documents evidencing such Borrowed
Money are delivered to the Agent promptly upon those documents being
entered into, or, where the context requires, the documents or instruments
evidencing such loans;
"SUBORDINATION DEEDS" means (a) the Intercompany Loan Subordination Deed
and the Target/Newco 2 Subordination Deed and (b) the HMTF Poultry/Newco2
Subordination Deed and any other subordination deeds from time to time
entered into in favour of the Security Trustee in respect of Subordinated
Shareholder Loans;
"SUBSCRIPTION AGREEMENTS" means:
(a) the subscription agreement dated 14 May 1999 as amended and restated
on 26 May 1999 between Cayman 1 and HMTF Investment Partners, C.V.
as subscriber; and
(b) the subscription agreement originally dated 14 May 1999 as amended
and restated on 26 May 1999 between Cayman 2 and HMTF Investment
Partners, C.V. as subscriber;
"SUBSIDIARY" means:
(a) in relation to the Target and Newco 2, a subsidiary within the
meaning of section 736 of the Act and, for the purposes of clauses
10.1(a), 10.3 and schedule 8 only, a subsidiary undertaking within
the meaning of section 258 of the Act; and
(b) in relation to any other person, any entity (a) which is controlled
directly or indirectly by that person or (b) of whose dividends or
distributions on ordinary voting share capital that person is
entitled to receive more than 50 per cent.; and "control" for this
purpose means the direct or indirect ownership of the majority of
the voting share capital of such entity or to determine the
composition of a majority of the board of directors (or like board)
of such entity, in each case whether by virtue of ownership of share
capital, contract or otherwise;
"SUBSTITUTE" has the meaning given to that term in clause 16.3;
"SUBSTITUTE BASIS" has the meaning given to that term in clause 14.4(b);
"SUBSTITUTION CERTIFICATE" means a certificate substantially in the terms
of part A or part B of schedule 5;
"SUPPLEMENTAL AGREEMENT" means the agreement supplemental to this
Agreement dated on or about 27 May 2002 made between, amongst others, the
parties to this Agreement;
"TARGET" means Premier Holdings Limited (formerly Hillsdown Holdings plc)
(company number 971448) whose registered office is at ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
28
"TARGET DAY" means a day on which the Trans-European Automated Real-time
Gross Settlement Express Transfer system (TARGET) is operating;
"TARGET GROUP" means the Target and its Subsidiaries from time to time and
"MEMBER OF THE TARGET GROUP" means any of them;
"TARGET GROUP SHARE PLEDGES" means the pledges in favour of the Security
Agent in the agreed form entered into, or to be entered into, by:
(i) Hillsdown Europe Limited (in respect of its shares in Hillsdown
Holland B.V.);
(ii) Premier International Foods UK Limited (in respect of its shares in
Melroses Limited and Ridgways Limited);
(iii) Hillsdown International B.V. (in respect of its shares in Jonker
Fris B.V.);
(iv) Hillsdown Holland B.V. (in respect of its shares in Hillsdown
Holdings France S.A.S.);
(v) Hillsdown Holdings France S.A.S. (in respect of its shares in
▇▇▇▇▇▇▇ ▇▇▇▇ ▇.▇. and Premier Brands France S.A.);
(vi) Newco 2 (in respect of its shares in Premier Brands Limited); and
(vii) Hillsdown Ambient Foods Group Limited (in respect of its shares in
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Sons (Est. 1849) Limited);
"TARGET/NEWCO 2 LOAN AGREEMENT" means the loan agreement in the agreed
form between Newco 2 as borrower and the Target pursuant to which
L215,200,000 of the proceeds of the Demerger have been lent to Newco
2;
"TARGET/NEWCO 2 SUBORDINATION DEED" means the agreed form subordination
deed entered into, or to be entered into, between the Target, Newco 2 and
the Security Agent;
"TARGET ORDINARY SHARES" means ordinary shares in the Target issued or to
be issued upon or at any time after the Effective Date;
"TARGET PREFERENCE SHARES" means the fixed rate preference shares in the
capital of the Target issued or to be issued upon or at any time after the
Effective Date;
"TAXES" means all taxes, imposts, duties, levies, charges, deductions and
withholdings in the nature or on account of tax whether of the United
Kingdom or elsewhere, together with all interest thereon and penalties
with respect thereto and "TAX" and "TAXATION" shall be construed
accordingly;
"TERM ADVANCE" means all or any (as the context requires) of a Facility A
Advance and a Facility B Advance;
29
"TERM COMMITMENT PERIOD" means in respect of (i) the Original Tranches,
the period commencing on 10 August 1999 and expiring on 18 August 1999 and
(ii) the Second Tranches, the Second Effective Date but, in any event,
ending on any earlier date upon which the Total Commitments in respect of
the relevant Tranche are cancelled or reduced to zero under or pursuant to
any of the terms of this Agreement;
"TERM FACILITIES" means Facility A and Facility B;
"TERMINATION DATE" means (i) (in respect of each Tranche) the last day of
its Term Commitment Period or (ii) (in respect of the Working Capital
Facility) the last day of the Working Capital Commitment Period;
"THIRD ACQUISITION AGREEMENTS" means the Acquisition Agreements (as
defined in the Senior Subordinated Facility Agreement);
"THIRD ACQUISITIONS" means the Acquisitions (as defined in the Senior
Subordinated Facility Agreement);
"THIRD PURCHASER" means the Purchaser (as defined in the Senior
Subordinated Facility Agreement);
"THIRD REPORTS" means the Reports (as defined in the Senior Subordinated
Facility Agreement);
"THIRD VENDORS" means the Vendors (as defined in the Senior Subordinated
Facility Agreement);
"TOTAL COMMITMENTS" means, in respect of a Tranche or a Facility or (as
the context requires) the Facilities at any relevant time, the total of
the Commitments of all the Banks in respect of such Tranche, Facility or
Facilities (as appropriate) at such time;
"TOTAL CONTRIBUTIONS" means, in respect of any Tranche or Facility or (as
the context requires) the Facilities at any relevant time, the total of
the Contributions of all the Banks in respect of such Tranche or Facility
or Facilities (as appropriate) at such time;
"TRANCHE" means all or any (as the context requires) of the Original
Tranches and the Second Tranches;
"TRANSACTION DOCUMENTS" means the Intercompany Loan Agreement, the
Target/Newco 2 Loan Agreement, the Subordinated Shareholder Loans, the
Demerger Agreements, the Second Transaction Documents and the Third
Acquisition Agreements;
"TREATY" means the Treaty establishing the European Economic Community
being the Treaty of Rome of 25 March 1957 as amended by the Single
▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ and the Maastricht Treaty (which was signed on 7
February 1992 and came into force on 1 November 1993) as amended, varied
or supplemented from time to time;
30
"TREATY LENDER" means a person which, by virtue of the provisions of a
double taxation agreement between the jurisdiction in which the relevant
Borrower is resident and the country of residence of that person is,
subject only to a prior direction given to the relevant Borrower by the
appropriate tax authority pursuant to an application by that person,
eligible, on the date of this Agreement (or, if later, the date such Bank
becomes a party to this Agreement) to have payments made to it by that
Borrower under this Agreement without any deduction or withholding in
respect of Taxes;
"TRUST PROPERTY" means, collectively, (i) the security, powers, rights,
titles, benefits and interests (both present and future) constituted by
and conferred on the Security Agent under or pursuant to the Security
Documents (including, without limitation, the benefit of all covenants
given in the Security Documents), (ii) all moneys, property and other
assets paid or transferred to or vested in the Security Agent (or any
agent of the Security Agent) or received or recovered by the Security
Agent (or any agent of the Security Agent) pursuant to, or in connection
with, any of the Security Documents whether from any member of the
Charging Group or any other person and (iii) all rights, benefits,
interests, money, investments, property and other assets at any time
representing or deriving from any of the foregoing, including all
interest, income and other sums at any time received or receivable by the
Security Agent (or any agent of the Security Agent) in respect of the same
(or any part thereof);
"UKIPR AGREEMENT" means the agreement for the sale of certain Intellectual
Property Rights in the agreed form entered into, or to be entered into,
between the certain of the Second Vendors and the UK Second Purchaser;
"UK LENDER" means:
(a) a company which is resident in the United Kingdom for tax purposes;
or
(b) a partnership each of whose members is a company so resident; or
(c) a company which is not resident in the United Kingdom for tax
purposes, but which carries on a trade in the United Kingdom through
a branch or agency and is subject to corporation tax on interest
paid to it under this Agreement under section 11(2) of the Income
and Corporation Taxes ▇▇▇ ▇▇▇▇;
"UK LISTING AUTHORITY" means the Financial Services Authority in its
capacity as the competent authority for the purposes of Part VI of the
Financial Services and Markets ▇▇▇ ▇▇▇▇;
"UK RESIDENT SUBSIDIARY" means any wholly-owned Subsidiary of Newco 2
which is incorporated in, and is, for the purposes of United Kingdom
Taxation, resident in, the United Kingdom;
"UK SECOND ACQUISITION" means the acquisition by the UK Second Purchaser
of the United Kingdom ambient food business of Nestle UK Ltd pursuant to
the UK Second Acquisition Agreements;
31
"UK SECOND ACQUISITION AGREEMENTS" means:
(a) the Second SPA;
(b) the UKIPR Agreement;
(c) the Rowntrees Licence; and
(d) all other documents delivered pursuant to or in relation to any of
(a) to (c) (inclusive) above (including, without limitation, the
transitional services agreement in the agreed form entered into, or
to be entered into, between certain of the Second Vendors and the
Second Purchasers in connection with the UK Second Acquisition);
"UK SECOND ACQUISITION COMPLETION DATE" means the date (which shall be a
Banking Day) on which the UK Second Acquisition is duly effected by the
completion of the UK Second Acquisition Agreements;
"UK SECOND PURCHASER" means Premier Ambient Products (UK) Limited (company
number 4427006) whose registered office is at ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"UK TOPCO" means Premier Foods Investments Limited (company number
04426994) whose registered office is at ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇;
"UNDERWRITERS" means the Original Underwriters and the Amendment
Underwriters;
"VOTING UNDERTAKING" means the agreed form voting undertaking granted, or
to be granted, by Cayman 1 in favour of the Security Agent;
"WORKING CAPITAL ADVANCE" means each borrowing by way of an advance under
the Working Capital Facility in accordance with clause 2.2 or (as the
context requires) the principal amount of that borrowing outstanding at
any relevant time;
"WORKING CAPITAL BANKS" means each person whose name is set out in the
relevant part of schedule 1 or which assumes rights and obligations in
respect of the Working Capital Facility pursuant to a Substitution
Certificate provided that upon (i) termination in full of all the
Commitments of any Working Capital Bank, and (ii) irrevocable payment in
full of all amounts which may be or become payable to such Working Capital
Bank under the Finance Documents, such Bank shall not be regarded as being
a Working Capital Bank for the purposes of determining whether any
provision of any of the Finance Documents requiring consultation with or
the consent or approval of or instructions from the Banks or the Majority
Banks has been complied with;
"WORKING CAPITAL BORROWERS" means Newco 2 and those wholly-owned
Subsidiaries of Newco 2 which are Charging Subsidiaries and which accede
to this Agreement as "Working Capital Borrowers" pursuant to clause 20 and
"WORKING CAPITAL BORROWER" means any of them;
32
"WORKING CAPITAL COMMITMENT PERIOD" means the period from the date of this
Agreement until 31 December 2007 or on such earlier date (if any) upon
which the Total Commitments in respect of the Working Capital Facility are
cancelled or reduced to zero under or pursuant to any of the terms of this
Agreement; and
"WORKING CAPITAL FACILITY" means the facility granted by clause 2.2 or as
the case may be the amount of that facility as determined in accordance
with that clause.
1.2 HEADINGS
Clause headings and the table of contents are inserted for convenience of
reference only and shall be ignored in the interpretation of this
Agreement.
1.3 CONSTRUCTION OF CERTAIN TERMS
In this Agreement, unless the context otherwise requires:
(a) references to clauses and schedules are to be construed as
references to the clauses of, and schedules to, this Agreement and
references to this Agreement include its schedules;
(b) references to (or to any specified provision of) this Agreement or
any other document shall be construed as references to this
Agreement, that provision or that document as in force for the time
being and as from time to time amended in accordance with its terms,
or, as the case may be, with the agreement of the relevant parties
and (where such consent is, by the terms of this Agreement or the
relevant document, required to be obtained as a condition to such
amendment being permitted) the prior written consent of the Agent;
(c) references to a "REGULATION" include any present or future
regulation, order, rule, directive, requirement, request or
guideline (whether or not having the force of law) of any
governmental body, agency, department or regulatory, self-regulatory
or other authority or organisation which is available to those
persons it affects;
(d) references to an "AUTHORISATION" mean and include any consent,
authorisation, licence, approval, exemption, filing, concession,
registration, notarisation and permit;
(e) words importing the plural shall include the singular and vice
versa;
(f) references to a time of day are to London time;
(g) references to a "PERSON" shall be construed as including references
to an individual, firm, company, corporation, unincorporated body of
persons or any State or any of its agencies;
(h) references to "ASSETS" include all or part of any business,
undertaking, real property, personal property, uncalled capital and
any rights (whether
33
actual or contingent, present or future) to receive, or require
delivery of, any of the foregoing;
(i) references to a "GUARANTEE" include references to an indemnity,
standby letter of credit or other assurance against financial loss
including, without limitation, an obligation to purchase assets or
services as a consequence of a default by any other person to pay
any Indebtedness and "guaranteed" shall be construed accordingly;
(j) references to the "EQUIVALENT" of an amount specified in a
particular currency (the "SPECIFIED CURRENCY AMOUNT") shall be
construed as a reference to the amount of the other relevant
currency which can be purchased at the Agent's spot rate (as
certified by the Agent) with the specified currency amount in the
London foreign exchange market at or about 11 a.m. on the day on
which the calculation falls to be made for spot delivery;
(k) references to any enactment shall be deemed to include references to
such enactment as re-enacted, amended or extended;
(l) references to documents being in the "AGREED FORM" mean documents
initialled by both counsel to the Agent (on behalf of the Agent, the
Documentation Agent and the Arrangers) and Weil, Gotshal & ▇▇▇▇▇▇
(on behalf of Newco 2) or, in the case of a document, not so
initialled in a form to be agreed between the Agent and Newco 2
(acting reasonably);
(m) references to a fixed date intended to mean the end of a financial
period shall be construed, unless the context otherwise requires, as
references to the accounting reference date in respect of that
financial period falling on or about that fixed date;
(n) references to a Bank as a Hedge Counterparty shall be deemed to
include a reference to any Bank Affiliate provided that such Bank
Affiliate shall first have acceded to this Agreement in such manner
as the Agent shall have required;
(o) an obligation to "DISCHARGE" includes, in respect of contingent
liabilities (including, without limitation, the Contingent Ancillary
Facilities Liabilities and the Letters of Credit), (i) an obligation
to use reasonable endeavours to procure the release of the relevant
Finance Parties from any liability in respect of such contingent
liabilities or (ii) to the extent required by the relevant Finance
Parties (by notice through the Agent), an obligation to pay to the
Security Agent or, where the context requires, the Cash Collateral
Account Bank or the Fronting Bank or the relevant Ancillary
Facilities Bank for the credit of a Cash Collateral Account by way
of cash collateral an amount as at the date of such notice which the
Security Agent or, as the case may be, the Cash Collateral Account
Bank or the Fronting Bank or the relevant Ancillary Facilities Bank
certifies to be equal to the amount of the relevant contingent
liabilities (including, where the context requires, the amount of
the Contingent Ancillary Facilities Liabilities owing to such
Ancillary Facilities Bank or the
34
amount of the outstanding Letters of Credit) to be discharged,
whereupon such amount shall become immediately or in accordance with
such notice due and payable. Amounts so credited to a Cash
Collateral Account (and interest thereon) shall (without prejudice
to the Security Documents) be applied in paying the amount of such
contingent liabilities as they fall due on maturity or other
crystallisation (and "DISCHARGED" shall be construed accordingly);
(p) a Working Capital Facility Drawing being "REPAID" or "PREPAID"
means, in the case of a Letter of Credit, such Letter of Credit
being discharged and "REPAYMENT", "PREPAYMENT", "REPAYING" and
"PREPAYING" should be construed accordingly;
(q) an amount "OUTSTANDING" at any time under or in respect of a Letter
of Credit is the maximum amount that may be demanded under that
Letter of Credit at that time in accordance with its express
provisions less (i) the aggregate amount of cash cover held in a
Cash Collateral Account in relation to that Letter of Credit at that
time and (ii) (save to the extent that this is taken into account in
the express provisions of that Letter of Credit) the aggregate of
all payments made by the Fronting Bank pursuant to demands made
under that Letter of Credit on or prior to such time (save to the
extent that the Fronting Bank has not been reimbursed in respect of
the same (unless the context otherwise requires)) and each provision
of this Agreement which requires reference to the concept contained
in this clause 1.3(q) shall be construed accordingly;
(r) references to documents being duly certified or to duly certified
copies of such documents shall mean that such documents are
certified as true and complete copies of the executed originals of
such documents by a director of Newco 2;
(s) references to a "RELEVANT BANK" mean (in the case of the Facility A)
a Facility A Bank, (in the case of the Facility B) a Facility B Bank
and (in the case of the Working Capital Facility) a Working Capital
Bank;
(t) references to "ORDINARY COURSE OF BUSINESS" mean, in relation to any
person, the ordinary course of business of such person carried out
in accordance with the Finance Documents; and
(u) references to "THE DATE OF THIS AGREEMENT" (and similar expressions)
mean 10 August 1999.
1.4 SUCCESSORS AND ASSIGNS
The expressions "AGENT", "AMENDMENT ARRANGERS", "AMENDMENT UNDERWRITERS",
"ANCILLARY FACILITIES BANKS", "ANCILLARY FACILITIES BORROWERS",
"ARRANGERS", "Banks", "BORROWERS", "DOCUMENTATION AGENT", "FINANCE
PARTIES", "FRONTING BANK", "HEDGE COUNTERPARTIES", "NEWCO 2", "OBLIGORS",
"FACILITY A BANKS", "FACILITY B Banks", "SECURITY AGENT", "UK SECOND
PURCHASER", "UNDERWRITERS", "WORKING CAPITAL BANKS" and "WORKING CAPITAL
BORROWERS" includes, in each case, their respective
35
successors and, in the case of the Finance Parties, their respective
permitted assignees, permitted transferees and Substitutes, whether
immediate or derivative.
2 THE FACILITIES
The Banks, relying upon each of the representations and warranties in
clause 9, but subject to clauses 3.3 and 3.4 agree to make available the
following facilities:
2.1 THE TERM FACILITIES
(a) The Facility A Banks agree to make available to Newco 2 a term loan
facility in a principal sum of up to the Facility A Limit consisting
of two tranches as follows:
(i) a tranche ("FACILITY A TRANCHE 1") in a principal amount of
L121,322,042 which was drawn and immediately on-lent to
the Target to be used to assist the Target Group to repay the
Relevant Liabilities; and
(ii) a tranche ("FACILITY A TRANCHE 2") in a principal amount of
L123,000,000 to be used for the Second Acquisitions
Purposes.
(b) The Facility B Banks agree to make available to Newco 2 a term loan
facility in a principal sum of up to the Facility B Limit consisting
of two tranches as follows:
(i) a tranche ("FACILITY B TRANCHE 1") in a principal amount of
L55,901,406 which was drawn and immediately on-lent to
the Target to be used to assist the Target Group to repay the
Relevant Liabilities; and
(ii) a tranche ("FACILITY B TRANCHE 2") in a principal amount of
L12,076,552 to be used for the Second Acquisitions
Purposes.
The parties acknowledge that as at the Second Effective Date:
(x) the Original Tranches are fully drawn; and
(y) no further Drawings may be made under the Original Tranches (as
there are no Available Commitments in respect of the Original
Tranches).
2.2 THE WORKING CAPITAL FACILITY
The Working Capital Banks agree to make available to the Working Capital
Borrowers a revolving working capital facility of up to L100,000,000
(or the equivalent in Optional Currencies), which shall be used by the
Working Capital Borrowers for the Group's general working capital purposes
(which shall not, for the avoidance of doubt, include any payment of
principal in respect of the Term Facilities nor any payment in connection
with the Second Acquisitions) or, subject to clause 4.5(a), to assist the
Target Group to repay the Relevant
36
Liabilities. This Facility may be utilised by means of Ancillary
Facilities, Working Capital Advances or Letters of Credit.
2.3 SEVERAL OBLIGATIONS
The obligation of each Bank under this Agreement in relation to a
particular Tranche or Facility shall be to contribute that proportion of
each relevant Advance under that Tranche or Facility which its Commitment
in relation to the relevant Tranche or Facility bears to the Total
Commitments in relation to such Tranche or Facility and, in respect of the
Working Capital Facility, to assume its obligations under clauses 4.12 and
15.6.
3 THE CONDITIONS
3.1 DOCUMENTS AND EVIDENCE
[Not restated]
3.2 GENERAL CONDITIONS PRECEDENT
The obligation of each Bank to contribute to any Advance or for the
Fronting Bank to issue any Letter of Credit or for any Ancillary
Facilities Bank to make available Ancillary Facilities is subject to the
further conditions that at the date of each Drawdown Notice and on each
Drawdown Date or, as the case may be, on the date of each request for such
other utilisation and on the date of each such other utilisation:
(a) the representations and warranties set out in clause 9.1 which are
repeated pursuant to clause 9.3 are true and correct in all material
respects on and as of each such date as if each were made with
respect to the facts and circumstances existing at such date; and
(b) in relation to the rollover of an existing Working Capital Advance
only (without increasing the amount thereof) for a Maturity Period
of no more than one month, no Event of Default shall have occurred
and be continuing or would result from the making of such Advance
and, in relation to any other Drawing, no Default shall have
occurred and be continuing or would result from the making of such
Drawing.
3.3 FACILITY A
The obligation of each relevant Facility A Bank to contribute to the first
Advance under Facility A Tranche 2 subject to the further condition that,
at the date of the relevant Drawdown Notice and on the relevant Drawdown
Date, Facility B Tranche 2 is drawn down in full.
3.4 WORKING CAPITAL FACILITY
The obligation of each Working Capital Bank to contribute to the first
Working Capital Drawing is subject to the further condition that, at the
date of each relevant Drawdown Notice and each relevant Drawdown Date, the
Facility B is drawn down in full.
37
3.5 WAIVER OF CONDITIONS PRECEDENT
The conditions specified in this clause 3 are inserted solely for the
benefit of the Banks and may be waived on their behalf in whole or in part
and with or without conditions by the Agent acting on the instructions of
the Majority Banks in respect of any Drawing or other utilisation of the
Facilities.
4 DRAWINGS UNDER THE FACILITIES
4.1 THE TERM FACILITIES
(a) Facility A Tranche 2
(i) Subject to the terms and conditions of this Agreement, the
Advances under Facility A Tranche 2 shall be made to Newco 2
on up to two occasions on the UK Second Acquisition Completion
Date each in an amount complying with clause 4.1(a)(ii)
following receipt by the Agent from Newco 2 of a completed
Drawdown Notice in the form of part A of schedule 2 not later
not later than 9:30 a.m. on the proposed Drawdown Date.
(ii) The principal amount specified in each Drawdown Notice
relating to Facility A Tranche 2 shall, subject to the terms
and conditions of this Agreement, be not less than
L1,000,000 or the balance of the Total Commitments in
respect of Facility A Tranche 2 and shall be used for the
purposes described in clause 2.1(a).
(iii) Newco 2 irrevocably instructs the Agent (x) (subject to
sub-clause (y) below) to remit the proceeds of each Advance
under Facility A Tranche 2, to the extent made for the
purposes of funding any part of the consideration payable
under the Second Acquisitions Agreements on the UK Second
Acquisition Completion Date, to the Second Vendors (whose
receipt shall be in good discharge to the Agent) and (y) to
deduct from the proceeds of the Advances under Facility A
Tranche 2 the amounts due under clause 5.1 of the Supplemental
Agreement. Newco 2 acknowledges that each such payment by the
Agent shall constitute the making of a Facility A Advance to
Newco 2 by the relevant Facility A Banks.
(iv) To the extent that Facility A Tranche 2 is not drawn down in
full by the up to two Advances under Facility A Tranche 2 on
the UK Second Acquisition Completion Date, or is not drawn
down by the Termination Date in respect of such Tranche, the
undrawn Commitments of the Facility A Banks in respect of
Facility A Tranche 2 (if any) shall thereupon be automatically
reduced to zero and cancelled.
(b) Facility B Tranche 2
38
(i) Subject to the terms and conditions of this Agreement,
Advances under Facility B Tranche 2 shall be made to Newco 2
on up to two occasions on the UK Second Acquisition Completion
Date each in an amount complying with clause 4.1(b)(ii)
following receipt by the Agent from Newco 2 of a completed
Drawdown Notice in the form of part A of schedule 2 not later
than 9:30 a.m. on the proposed Drawdown Date.
(ii) The principal amount specified in each Drawdown Notice
relating to the Facility B Tranche 2 shall, subject to the
terms and conditions of this Agreement, be not less than
L1,000,000 or the balance of the Total Commitments in
respect of the Facility B Tranche 2 and shall be used for the
purposes described in clause 2.1(b).
(iii) Newco 2 irrevocably instructs the Agent (x) (subject to
sub-clause (y) below) to remit the proceeds of each Advance
under Facility B Tranche 2, to the extent made for the
purposes of funding any part of the consideration payable
under the Second Acquisitions Agreements on the UK Second
Acquisition Completion Date, to the Second Vendors (whose
receipt shall be in good discharge to the Agent) and (y) to
deduct from the proceeds of the Advances under Facility B
Tranche 2 the amounts due under clause 5.1 of the Supplemental
Agreement. Newco 2 acknowledges that each such payment by the
Agent shall constitute the making of a Facility B Advance to
Newco 2 by the relevant Facility B Banks.
(iv) To the extent that the Facility B is not drawn down in full by
the up to two Advances under Facility B Tranche 2 on the UK
Second Acquisition Completion Date, or is not down by the
Termination Date in respect of such Tranche, the undrawn
Commitments of the Facility B Banks in respect of the Facility
B Tranche 2 (if any) shall thereupon be automatically reduced
to zero and cancelled.
(c) If the UK Second Acquisition Completion Date has not occurred on or
before 30 June 2002 (or such later date as the Amendment
Underwriters may agree for the purposes of clause 2.1 of the
Supplemental Agreement), the Second Tranches shall be cancelled.
4.2 THE WORKING CAPITAL FACILITY
(a) Subject to the terms and conditions of this Agreement, a Working
Capital Advance shall be made to the relevant Working Capital
Borrower or a Letter of Credit issued following receipt by the Agent
from Newco 2 of an appropriately completed Drawdown Notice in the
form of part B of schedule 2 (such Drawdown Notice in the case of a
Letter of Credit to include the additional information required by
clause 4.9) not later than 10 a.m. on the first Banking Day or (in
the case of a Working Capital Advance or Letter of Credit in an
Optional Currency) the third Banking
39
Day before the proposed Drawdown Date. No Drawdown Notice may be
given in respect of an amount which is the subject of a notice
received by the Agent under clause 6.8.
(b) (i) Working Capital Advances may only be made or Letters of Credit
issued on Banking Days falling on or after the UK Second
Acquisition Completion Date and within the Working Capital
Commitment Period.
(ii) Each Working Capital Advance or Letter of Credit shall be of
L500,000 (or the equivalent in Optional Currencies) or
any larger sum which is an integral multiple of L25,000
(or the equivalent in Optional Currencies) or, if less, the
relevant Available Facility Amount on the relevant Drawdown
Date.
(iii) Working Capital Advances may only be borrowed for a Maturity
Period of 1, 2, 3 or 6 or (if available to all the Banks) 9 or
12 months (or such other period as the Agent, acting on the
instructions of the Majority Banks, may agree) ending not
later than the Termination Date in respect of the Working
Capital Facility and Letters of Credit may only be issued for
a period not exceeding 12 months ending not later than the
Termination Date in respect of the Working Capital Facility.
(iv) There shall be no more than 8 Working Capital Advances or
Letters of Credit outstanding at any time.
(v) For the purposes of assisting syndication of the Facilities,
the Maturity Periods for the Working Capital Advances shall
until the Second Syndication Completion Date be such period or
periods as may be agreed between Newco 2 and the Agent.
(vi) In the case of a Letter of Credit, the Fronting Bank and the
Agent shall approve (such approval not to be unreasonably
withheld or delayed) the terms and beneficiary of the Letter
of Credit to be issued under the Drawdown Notice, the form of
which shall be agreed (with all parties acting reasonably) by
the Fronting Bank, the Agent and the relevant Working Capital
Borrower.
4.3 SELECTION OF CURRENCIES IN RESPECT OF THE WORKING CAPITAL FACILITY
Subject to the provisions of clauses 4.2(b) and 14.6, and provided that as
a consequence thereof there would not be Working Capital Advances and
Letters of Credit outstanding in more than 5 different currencies (for
which purposes, for the avoidance of doubt, each National Currency Unit
and euros are different currencies), if the relevant Borrower so requests
in the relevant Drawdown Notice, an Advance or a Letter of Credit may be
drawn down in an Optional Currency, but if no such request is received by
the Agent such Drawing will be drawn down in Sterling.
4.4 THE ANCILLARY FACILITIES
40
(a) Subject to clause 4.5, the Working Capital Borrowers shall be
entitled to utilise all or part of the Working Capital Facility by
way of Ancillary Facilities instead of, or in addition to, by way of
Working Capital Advances or Letters of Credit. The Ancillary
Facilities shall, subject to the terms of the Ancillary Facilities
Letters and the other provisions of this Agreement, cease to be
available on the Termination Date in respect of the Working Capital
Facility.
(b) Ancillary Facilities may comprise:
(i) overdraft facilities;
(ii) guarantee, bonding, documentary or stand-by letter of credit
facilities;
(iii) short term loans;
(iv) foreign exchange facilities; or
(v) other facilities or accommodation as may be required in
connection with the business of the Group and which are agreed
with the relevant Ancillary Facilities Bank.
(c) The relevant Ancillary Facilities Borrower may, at any time from the
date of this Agreement to the Termination Date in respect of the
Working Capital Facility, by notice in writing to the Agent request
the establishment of an Ancillary Facility by the conversion of an
Available Commitment in respect of the Working Capital Facility (or
any part of it) into an Ancillary Commitment with effect from the
date (or such later date as the Ancillary Facilities Borrower, the
relevant Ancillary Facilities Bank and the Agent may agree from time
to time) specified in such notice (the "CONVERSION EFFECTIVE DATE")
being a date not less than three Banking Days after the date such
notice is received by the Agent being a date not earlier than the
first Drawdown Date in respect of the Facilities. Any such notice
shall specify:
(i) the proposed Ancillary Facilities Borrower;
(ii) the proposed commencement and expiry date for the Ancillary
Facility concerned (and the expiry date must be a Banking Day
on or prior to the Termination Date in respect of the Working
Capital Facility);
(iii) the type of the proposed Ancillary Facility;
(iv) the proposed Ancillary Facilities Bank;
(v) the Ancillary Commitment to apply to the proposed Ancillary
Facility; and
(vi) such other details as to the nature, amount and operation of
the proposed Ancillary Facility as the Agent may reasonably
require,
41
and the Agent shall promptly notify each Bank upon receipt of any
such notice.
(d) Any Bank so nominated (provided that it has a sufficient Available
Commitment in respect of the Working Capital Facility and has agreed
to become an Ancillary Facilities Bank) may become an Ancillary
Facilities Bank authorised to make the proposed Ancillary Facility
available with effect on and from the Conversion Effective Date.
(e) Any material variation in any Ancillary Facility or proposed
increase or reduction in the Ancillary Commitment relating to such
Ancillary Facility shall be effected on and subject to the
provisions, mutatis mutandis, of this clause 4.4.
(f) Save to the extent that an Ancillary Commitment is being converted
to an Available Commitment in respect of the Working Capital
Facility pursuant to clause 4.6, no Ancillary Facilities Bank may,
until notice has been served under clause 12.2, demand repayment of
any moneys made available by it, or demand cash cover in respect of
any guarantees or similar contingent liabilities made available by
it, under its Ancillary Facility or take any action analogous to any
of the foregoing under any other type of banking arrangements
provided by it under its Ancillary Facility (without prejudice to
any rights of such Ancillary Facilities Bank to set off amounts
standing to the debit and credit of different accounts of any member
or members of the Group held with it).
(g) The Ancillary Commitment of each Ancillary Facilities Bank shall
terminate no later than the Termination Date in respect of the
Working Capital Facility.
(h) An Ancillary Facility may include a facility provided on a net nil
basis so that the amount of the Ancillary Commitment allocated to
such Ancillary Facility is zero and therefore no conversion is
required of any Available Commitment in respect of the Working
Capital Facility. However, if any outstandings arise under such net
nil Ancillary Facility following an Enforcement Date such
outstandings will be treated as Ancillary Facilities Liabilities for
the purposes of this Agreement.
4.5 LIMITS
(a) Newco 2 and the other Borrowers shall ensure that at no time:
(i) the aggregate Sterling Amount of the Working Capital Advances,
the aggregate Ancillary Commitments and the outstanding
aggregate amount of all issued Letters of Credit exceeds an
amount equal to the Total Commitments in respect of the
Working Capital Facility at that time;
(ii) the aggregate Drawings under the Working Capital Facility used
to assist in the repayment of any Relevant Liabilities exceeds
L43,500,000 excluding Letters of Credit issued to cover
overdraft
42
facilities and contingent liabilities in the ordinary course
of business;
(iii) the aggregated Ancillary Facilities Liabilities of any
Ancillary Facilities Bank exceed the Ancillary Commitment of
such Ancillary Facilities Bank at that time;
(iv) the outstanding aggregate Sterling Amount of all Drawings by
way of Letters of Credit and/or guarantees and/or letters of
credit issued under Ancillary Facilities exceeds L60,000,000;
and
(v) the aggregate outstandings, calculated on a gross basis, under
all the overdraft facilities provided under the Ancillary
Facilities exceed L75,000,000 (or its equivalent in any other
currency); and
(vi) the aggregate Sterling Amount of the Working Capital Advances,
the aggregate amount of all issued Letters of Credit and the
aggregate utilisations of the Ancillary Facilities (for the
avoidance of doubt including, in the case of the Ancillary
Facilities, interest, fees and charges which have been debited
to the Working Capital Borrowers' accounts with the Ancillary
Facilities Banks), calculated on a gross basis, exceeds
L200,000,000 (or its equivalent in any other currency).
(b) Without prejudice to any other provision of this Agreement, the
Total Commitments under the Working Capital Facility shall in any
event be reduced to zero on the Termination Date in respect of such
Facility and no Drawing may be made by the Working Capital Borrowers
under the Working Capital Facility thereafter.
4.6 COMMITMENTS OF ANCILLARY FACILITIES BANKS
The Commitment in respect of the Working Capital Facility of each
Ancillary Facilities Bank shall be reduced pro tanto by the amount of its
Ancillary Commitment but shall automatically increase upon the relevant
Ancillary Facility ceasing to be available to the relevant Ancillary
Facilities Borrower or that Ancillary Facility being cancelled in
accordance with clause 4.7 and (in each case) the amounts (actually or
contingently) outstanding thereunder being repaid or discharged.
4.7 CANCELLATION OF ANCILLARY FACILITIES
Any Ancillary Facilities Borrower which has established an Ancillary
Facility may at any time by notice in writing to the Agent and the
relevant Ancillary Facilities Bank cancel such Ancillary Facility, in
which event on the date specified in the notice, being a date not less
than three Banking Days after the date such notice is received by the
Agent and the relevant Ancillary Facilities Bank, the relevant Ancillary
Commitment shall be converted into a Commitment in respect of the Working
Capital Facility.
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4.8 OPERATION OF ACCOUNTS NOTWITHSTANDING THE SECURITY DOCUMENTS
Notwithstanding the fixed charges on bank accounts and Debts (as that term
is defined in the Group Debenture) contained in the Security Documents,
each Ancillary Facilities Bank may, subject to clause 15.6, continue to
exercise its rights of set-off or combination of accounts under any Group
netting agreements.
4.9 LETTERS OF CREDIT: DRAWDOWN NOTICE
A Drawdown Notice requesting the issue of a Letter of Credit (in addition
to complying with clause 4.2) must specify in respect of the Letter of
Credit to be issued pursuant to such Drawdown Notice:
(a) the purpose of its issue;
(b) the issue date;
(c) the final expiry date as selected in accordance with clause
4.2(b)(iii);
(d) its terms and the beneficiary agreed in accordance with clause
4.2(b)(vi);
(e) its face value;
(f) details of any documents and information required to be presented
pursuant to the proposed Letter of Credit; and
(g) the name of the Fronting Bank.
For the avoidance of doubt, the beneficiary and purpose of a Letter of
Credit must be such that the Fronting Bank can, in compliance with all
applicable laws, policies and regulations binding on or affecting the
Fronting Bank, properly issue a Letter of Credit to such beneficiary and
for such purpose without breaching such laws, policies and regulations.
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4.10 FRONTING BANK TO ACT AS PRINCIPAL
Where the Working Capital Facility is to be drawn by way of a Letter of
Credit, such Letter of Credit shall be made available by the Fronting Bank
which shall act as the principal of the Letter of Credit at the request of
the relevant Working Capital Borrower. If Newco 2 requests, the Agent,
Newco 2 and the Banks shall consult to consider what changes are required
to be made to this Agreement to permit the Working Capital Borrowers to
make Drawings under the Working Capital Facility by way of letters of
credit and guarantees issued by all the Working Capital Banks on a several
basis. After such consultation, the Agent (acting on the instructions of
the Majority Banks (acting reasonably)) shall notify Newco 2 and the Banks
of the amendments which it considers to be necessary to permit this and
notwithstanding clause 17.11, shall be entitled to make such amendments to
this Agreement.
4.11 BORROWER'S AUTHORISATION
Each Working Capital Borrower hereby:
(a) irrevocably authorises the Fronting Bank (subject to its compliance
with its obligations in respect of the Letter of Credit) to make any
payment and comply with any demand made by a third party in respect
of a Letter of Credit which is valid on its face, appears to comply
with the terms of such Letter of Credit and which may be claimed
from or made upon it, without any reference to or further authority
from the relevant Working Capital Borrower unless it has actual
knowledge that any such demand is fraudulent;
(b) agrees that its authorisation under clause 4.11(a) shall remain in
full force and effect and shall not be discharged until such date as
the Fronting Bank shall notify the relevant Working Capital Borrower
and the Agent that it is fully satisfied that it remains under no
liability (actual or contingent) in respect of any Letter of Credit;
(c) agrees that each Letter of Credit is issued subject to and with the
benefit of the provisions of schedule 12; and
(d) agrees that it will at all times indemnify the Banks on demand of
the Agent and keep the Banks indemnified on demand of the Agent from
and against all actions, suits, proceedings, claims, demands,
liabilities and damages and any reasonable costs, expenses, losses
and charges whatsoever (the "INDEMNIFIED CLAIMS") in relation to or
arising out of clause 4.12 except to the extent that the Indemnified
Claims arise or result from such Bank's gross negligence or wilful
default or pursuant to clause 4.16 and provided that such Working
Capital Borrower shall be entitled to finance a payment under such
indemnity by utilising the Working Capital Facility if it is then
entitled to draw under the Working Capital Facility in accordance
with the terms of this Agreement.
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4.12 WORKING CAPITAL BORROWERS' FAILURE TO PERFORM
(a) In the event of any failure of any relevant Working Capital Borrower
to perform its obligations under clause 4.11, each Working Capital
Bank hereby irrevocably and unconditionally either:
(i) guarantees to the Fronting Bank severally up to the amount of
its Relevant Proportion, and as a primary obligation, the due
and punctual observance and performance of all of the payment
obligations of such Working Capital Borrower in respect of any
Letter of Credit; or
(ii) if it is not permitted by its constitutive documents or any
applicable law to grant guarantees, without any further
action, shall be deemed to have taken, as of the date of
issuance of each outstanding Letter of Credit, an undivided
participating interest from the Fronting Bank in such Letter
of Credit outstanding at such time in its Relevant Proportion.
Each Working Capital Bank shall hold the Fronting Bank
harmless and indemnify the Fronting Bank for such Working
Capital Bank's proportionate share of any drawing under any
Letter of Credit in which it has taken such an undivided
participating interest under this clause 4.12.
(b) The obligation of each Working Capital Bank to make payments to the
Fronting Bank with respect to any Letter of Credit shall be
irrevocable and shall not be subject to any qualification or
exception whatsoever and shall be made in accordance with the terms
and conditions of this Agreement under all circumstances, including
without limitation any of the following circumstances:
(i) any lack of validity or enforceability of this Agreement, any
of the other Finance Documents or any other documents or
instruments executed by any member of the Charging Group or
any Affiliate thereof and delivered to the Agent, the Fronting
Bank or any other Bank in connection with or related to the
Facilities, the Letters of Credit or the assets subject to the
Security Documents, together with any and all amendments,
extensions, renewals and modifications thereof;
(ii) the existence of any claim, set-off, defence or other right
which any member of the Charging Group may have at any time
against the beneficiary named in any Letter of Credit or any
transferee of any Letter of Credit (or any person for whom any
such transferee may be acting), the Agent, the Fronting Bank,
any other Bank or any other person, whether in connection with
this Agreement, such Letter of Credit, the transactions
contemplated in this Agreement or any unrelated transactions
(including any underlying transactions between any member of
the Charging Group or any Subsidiary of such member and the
beneficiary named in such Letter of Credit);
46
(iii) any draft, certificate or any other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of this
Agreement or any of the other Finance Documents; or
(v) the occurrence of any Default.
(c) In the event of any failure of any relevant Working Capital Borrower
to perform its obligations under clause 4.11, each Working Capital
Bank hereby irrevocably and unconditionally agrees to pay to the
Agent for the account of the Fronting Bank on demand made through
the Agent, its Relevant Proportion of:
(i) any and every sum or sums of money which such Working Capital
Borrower shall from time to time be liable to pay (and which
are unpaid) to the Fronting Bank in respect of a Letter of
Credit; and
(ii) full cash cover for outstanding contingent liabilities at any
time after the Fronting Bank has become entitled to require,
and has required, an indemnity in respect of outstanding
contingent liabilities from such Working Capital Borrower and
which shall not have been paid at the time such demand is
made.
4.13 DEEMED CASH ADVANCE
Any payment made by a Working Capital Bank pursuant to clause 4.12 and any
unreimbursed amount on the part of the Fronting Bank shall (for the
purpose of calculating interest thereon which is due from the relevant
Working Capital Borrower) be deemed to have been made available to the
Working Capital Borrower by way of a Working Capital Advance on the date
such payment is made (or reimbursed) and accordingly is subject to the
terms and conditions of this Agreement as if it were such a Working
Capital Advance but shall be immediately due and payable by the relevant
Working Capital Borrower provided for the avoidance of doubt there shall
be no double counting of the amounts outstanding in respect of the Letter
of Credit and the Working Capital Advance deemed to be made pursuant to
this clause 4.13.
4.14 PRESERVATION OF FRONTING BANK'S RIGHTS
(a) As a separate and independent stipulation each Working Capital Bank
agrees that any sum or sums of money intended to be the subject of
the guarantee in clause 4.12 and subject to clause 4.12(b) shall be
recoverable from such Working Capital Bank (in its respective
Relevant Proportion) as sole principal debtor if they would not be
recoverable from any relevant Working Capital Borrower by reason of
any legal limitation, disability or incapacity or liquidation of any
of them or any
47
other fact or circumstance (whether known to the Fronting Bank or
not), but would have been recoverable from such Working Capital Bank
if it were the sole or principal debtor in respect of such liability
in place of any such Working Capital Borrower.
(b) The obligation of each Working Capital Bank contained in clause 4.12
shall not be affected in any way by any time or indulgence granted
to any relevant Working Capital Borrower or by any variation,
compromise or release of any of their obligations to the Fronting
Bank under the Working Capital Facility.
(c) Any settlement or discharge between any Working Capital Bank and the
Fronting Bank shall be conditional upon no security or payment to
the Fronting Bank by any Working Capital Borrower or any other
person on behalf of any Working Capital Borrower being avoided or
reduced by virtue of any provisions or enactments relating to
bankruptcy, insolvency or liquidation for the time being in force
and, if any such security or payment shall be avoided or reduced,
the Fronting Bank shall be entitled to recover the value or amount
of such security or payment from such Working Capital Bank
subsequently as if such settlement or discharge had not occurred.
4.15 NO OBLIGATION ON FRONTING BANK
The Fronting Bank shall not be obliged before requesting
counter-indemnification from any Working Capital Bank to:
(a) obtain judgment in any court against any Borrower, any other member
of the Group or any other person;
(b) make or file any claim or proof in a winding-up or dissolution of
any Borrower, any other member of the Group or any other person; or
(c) enforce or seek to enforce any other security taken in respect of
any of the obligations of any Borrower, any other member of the
Group or any other person.
4.16 DEFAULTING WORKING CAPITAL BANK
If a Working Capital Bank (a "DEFAULTING BANK") fails to make payment on
the due date for such payment of any amount due from it for the account of
the Fronting Bank pursuant to clause 4.12 (the balance thereof for the
time being unpaid being referred to in this clause as an "OVERDUE AMOUNT")
then until the Fronting Bank (or the Agent on its behalf) has received
payment of that amount in full (and without prejudice to any other rights
or remedies of the Fronting Bank in respect of such failure) the Fronting
Bank shall be entitled to receive (i) any remuneration which such
Defaulting Bank would otherwise have been entitled to receive in respect
of the Working Capital Facility and (ii) the benefit of all security then
existing or thereafter created to secure the obligations of the Working
Capital Borrower under this Agreement to which the Defaulting Bank would
have been entitled had it made such payment and, for the purpose of
48
determining the Majority Banks, the Fronting Bank shall be treated as a
Working Capital Bank having a Commitment and/or Contribution equal to the
Commitment and/or Contribution of the Defaulting Bank which has failed to
make such payment.
4.17 DRAWINGS GENERALLY
(a) A Drawdown Notice (or notice purporting to be such) shall only be
effective if it complies with this Agreement and only upon actual
receipt by the Agent and, once given, shall be irrevocable.
(b) As soon as practicable after receipt of each Drawdown Notice
complying with this Agreement the Agent shall notify each relevant
Bank thereof and (other than in the case of a Drawdown Notice
relating to a Letter of Credit) of the date on which the proposed
Drawing is to be made and of the relevant Interest Period or, as the
case may be, the relevant Maturity Period. Subject to clause 3, each
relevant Bank shall on such Drawdown Date participate in such
Drawing by making available to the Agent its portion of such Drawing
in accordance with clause 8.2.
(c) If a Working Capital Advance is to be drawn down or a Letter of
Credit issued in an Optional Currency, the amount to be advanced to
the relevant Working Capital Borrower or (as the case may be) the
face amount of that Letter of Credit the shall (subject to clauses
6.2 and 14.6) be the amount of such Optional Currency specified in
the relevant Drawdown Notice. For the purposes of determining the
Sterling Amount of such Drawing the Agent shall determine the
equivalent in Sterling of such amount of Optional Currency at or
about 11 a.m. on the third Banking Day before the Drawdown Date of
such Drawing.
(d) If a Working Capital Advance is to be drawn down or a Letter of
Credit issued in Sterling, the amount to be advanced to the relevant
Borrower shall (subject to clause 6.2) be the Sterling Amount of
such Drawing.
4.18 APPLICATION OF PROCEEDS
Without prejudice to the Borrowers' obligations under clause 10.2(a), none
of the Finance Parties shall have any responsibility for the application
of the proceeds of any Drawing by any Borrower.
5 INTEREST AND INTEREST PERIODS
5.1 INTEREST ON THE TERM ADVANCES
(a) Interest obligations
Newco 2 shall pay interest on each Term Advance in respect of each
Interest Period on the relevant Interest Payment Date (or, in the
case of Interest Periods of more than 6 months, by instalments,
every 6 months from the commencement of the relevant Interest Period
and on the relevant Interest Payment Date) at the rate per annum
determined by the
49
Agent to be the aggregate of (i) the applicable Margin, (ii) the
Additional Cost and (iii) the Funding Cost.
(b) Interest Periods for the Term Advances
(i) Newco 2 may by notice received by the Agent not later than 10
a.m. on the Banking Day before the beginning of each Interest
Period in respect of each Term Advance:
(x) (subject to clause 5.1(b)(ii)(E)) specify whether such
Interest Period shall have a duration of 1, 2, 3 or 6 or
(if available to all Banks) 9 or 12 months (or such
other period as the Agent, acting on the instructions of
the Majority Banks, shall agree); and/or
(y) (after the Termination Date applicable to the relevant
Tranche) specify that such Term Advance shall be split
into two or more Term Advances drawn under the relevant
Tranche or, if the next Interest Period for that Term
Advance would begin on the same day as the next Interest
Period in respect of any other Term Advance drawn under
the same Tranche, that such Term Advances be
consolidated into one Term Advance, in each case with
effect from the beginning of the next Interest Period,
provided that:
(A) not more than 12 Term Advances may be outstanding
at any one time under the Term Facilities; and
(B) each Term Advance shall be not less than
L1,000,000 (or any larger sum which is an integral
multiple of L50,000) or the balance of the
Commitments in respect of the relevant Tranche.
(ii) Every Interest Period in respect of each Term Advance shall be
of the duration specified by Newco 2 pursuant to clause
5.1(b)(i) but so that:
(A) the initial Interest Period in respect of each Term
Advance will commence on the relevant Drawdown Date and
each subsequent Interest Period in respect thereof shall
commence forthwith upon the expiry of the previous
Interest Period;
(B) Interest Periods in respect of Term Advances under a
Tranche of an aggregate amount at least equal to the
amount of the repayment instalments due on any Repayment
Date relating to such Tranche shall end on such date;
50
(C) Interest Periods in respect of each Term Advance (to the
extent it is hedged pursuant to a Hedge Transaction)
shall match the payment periods in respect of the
relevant Hedge Transaction;
(D) if Newco 2 fails to select the duration of an Interest
Period in respect of a Term Advance in accordance with
the provisions of clause 5.1(b)(i) and this clause
5.1(b)(ii) such Interest Period shall have a duration of
3 months or such other period as shall comply with this
clause 5.1(b)(ii); and
(E) for the purpose of assisting in the syndication of the
Facilities after the Second Effective Date, the Interest
Periods for the Term Advances shall until the Second
Syndication Completion Date be such period or periods as
may be agreed between Newco 2 and the Agent.
5.2 INTEREST AND FEES UNDER THE WORKING CAPITAL FACILITY
(a) Working Capital Advances
The relevant Working Capital Borrower shall pay interest on each
Working Capital Advance on its Maturity Date (or, in the case of a
Working Capital Advance having a Maturity Period of more than 6
months, by instalments, every 6 months from the relevant Drawdown
Date and on the relevant Maturity Date) at the rate per annum
determined by the Agent to be the aggregate of (i) the applicable
Margin, (ii) the Additional Cost and (iii) the Funding Cost.
(b) Ancillary Facilities
(i) The terms governing the operation of any Ancillary Facility
(including the terms of any counter-indemnity required in
connection therewith) and the rate of interest, fees and other
remuneration in respect of each Ancillary Facility shall be
determined by agreement between the Ancillary Facilities Bank
and the Ancillary Facilities Borrower concerned and the fees
and other remuneration for all Ancillary Facilities shall be
based upon normal market rates and terms.
(ii) In the case of inconsistency between any term of an Ancillary
Facility and of this Agreement, the terms of this Agreement
shall prevail.
(iii) Each Ancillary Facilities Borrower and each Ancillary
Facilities Bank agree with and for the benefit of each Bank
that the Ancillary Facilities Liabilities under any Ancillary
Facility provided by that Ancillary Facilities Bank (net of
any cash collateral held by such Ancillary Facilities Bank in
its capacity as such and other than to the extent arising by
virtue of the
51
accumulation of interest, increased costs, fees and expenses
and indemnity claims) shall not exceed the Ancillary
Commitment applicable to that Ancillary Facility but this
clause 5.2(b)(iii) shall not apply to any net nil Ancillary
Facility, or any Ancillary Facilities Liabilities arising
under such net nil Ancillary Facility, referred to in clause
4.4(h).
(iv) Each Ancillary Facilities Borrower and each Ancillary
Facilities Bank will, promptly upon request by the Agent,
supply the Agent with such information relating to the
operation of each Ancillary Facility provided by such
Ancillary Facilities Bank (including, without limitation, the
Ancillary Facilities Liabilities under such Ancillary
Facility) as the Agent may from time to time request (acting
reasonably). Each Ancillary Facilities Borrower consents to
all such information being released to the Agent and each
Bank.
(c) Letter of Credit commission
(i) Each relevant Working Capital Borrower shall pay letter of
credit commission to the Agent for the account of the Working
Capital Banks (in their respective Relevant Proportions) on
the issue of any Letter of Credit requested by such Working
Capital Borrower under this Agreement at a rate per annum
equal to the applicable Margin prevailing in relation to
Working Capital Advances (or which would prevail were there
any Working Capital Advances) from time to time on the
outstanding face amount of such Letter of Credit calculated
from the date of issuance of such Letter of Credit until such
date as the Fronting Bank and the Working Capital Banks have
ceased to be under any liability (actual or contingent) in
respect of such Letter of Credit.
(ii) Each relevant Working Capital Borrower shall pay to the
Fronting Bank for its own account a fronting fee on the issue
of any Letter of Credit for the benefit of such Working
Capital Borrower at the rate of 0.125 per cent. per annum on
the Fronting Bank's net exposure under such Letter of Credit
calculated from the date of issuance of such Letter of Credit
until such date as the Fronting Bank has ceased to be under
any liability (actual or contingent) in respect of such Letter
of Credit.
(iii) The commission payable under clause 5.2(c)(i) and the fronting
fee payable under clause 5.2(c)(ii) shall be paid in arrears
on each 31 March, 30 June, 30 September and 31 December in
each year during the continuance of the Working Capital
Facility (and if such day is not a Banking Day, on the
preceding Banking Day) commencing on the first of the dates 31
March, 30 June, 30 September and 31 December on or after the
issuance of the relevant Letter of Credit and, in each case,
on the Termination Date.
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(iv) For the avoidance of doubt, the Fronting Bank's Relevant
Proportion of the commission at the rate and calculated in the
manner specified in clause 5.2(c)(i) shall be payable to the
Fronting Bank in its capacity as a Working Capital Bank,
notwithstanding that it may not be legally capable of
guaranteeing itself in its capacity as Fronting Bank.
5.3 INTEREST ON OVERDUE AMOUNTS
(a) If any Borrower fails to pay any sum (including, without limitation,
any sum payable pursuant to this clause 5.3) on its due date for
payment under this Agreement such Borrower shall pay interest on
such sum from the due date up to the date of actual payment (as well
after as before judgment) at a rate determined by the Agent pursuant
to this clause 5.3.
(b) The period beginning on the due date for payment and ending on the
date of actual payment shall be divided into successive periods of
not more than 3 months as selected by the Agent (after consultation
with the Banks so far as reasonably practicable in the
circumstances) each of which (other than the first, which shall
commence on such due date) shall commence on the last day of the
preceding such period, but so that if the unpaid sum is an amount of
principal which shall have become due and payable prior to the next
succeeding Interest Payment Date relating thereto or, as the case
may be, prior to the relevant Maturity Date, then the first such
period selected by the Agent shall end on such Interest Payment Date
or, as the case may be, such Maturity Date.
(c) The rate of interest applicable to each period referred to in clause
5.3(b) shall be the aggregate as determined by the Agent) of (i) one
per cent. per annum, (ii) the applicable Margin, (iii) the
Additional Cost and (iv) the Funding Cost.
(d) Interest under this clause 5.3 shall be due and payable on the last
day of each period determined by the Agent pursuant to this clause
5.3 or, if earlier, on the date on which the sum in respect of which
such interest is accruing shall actually be paid.
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5.4 NOTIFICATION OF INTEREST PERIODS AND INTEREST RATE
The Agent shall notify Newco 2 (who shall notify each other relevant
Borrower) and the relevant Banks promptly of the duration of each Interest
Period, Maturity Period or other period for the calculation of interest
(or, as the case may be, default interest) and of each rate of interest
determined by it under this clause 5.
5.5 REFERENCE BANK QUOTATIONS
If any relevant Reference Bank is unable or otherwise fails to furnish a
quotation for the purpose of calculating LIBOR or EURIBOR (as appropriate)
where such a quotation is required having regard to the definitions of
"LIBOR" and "EURIBOR" in clause 1.1 the interest rate for the relevant
Interest Period, Maturity Period or other relevant period shall be
determined, subject to clause 14.4, on the basis of the quotations
furnished by the remaining relevant Reference Banks.
6 REPAYMENT, PREPAYMENT, CANCELLATION AND REDUCTIONS
6.1 REPAYMENT OF THE FACILITIES
(a) Facility A Advances
Newco 2 shall repay the Facility A Advances in Sterling by
instalments on the corresponding Repayment Dates set out in clause
6.1(c). Such repayments shall be made so as to reduce the Facility A
Advances under each Tranche of Facility A proportionately.
(b) Facility B Advances
Newco 2 shall repay the Facility B Advances in Sterling by
instalments on the corresponding Repayment Dates set out in clause
6.1(c). Such repayments shall be made so as to reduce the Facility B
Advances under each Tranche of Facility B proportionately.
54
(c) Repayment schedule
Instalment in respect of Instalment in respect of
Facility A Advances Facility B Advances
Repayment Date (pound) (pound)
---------------- ------------------------ ------------------------
30 June 2002 10,000,000 0
31 December 2002 10,000,000 0
30 June 2003 13,500,000 0
31 December 2003 13,500,000 0
30 June 2004 18,000,000 0
31 December 2004 18,000,000 0
30 June 2005 25,000,000 0
31 December 2005 25,000,000 0
30 June 2006 26,000,000 0
31 December 2006 26,000,000 0
30 June 2007 29,000,000 0
31 December 2007 30,322,042 0
30 June 2008 0 33,988,979
31 December 2008 0 33,988,979
----------- ----------
TOTAL 244,322,042 67,977,958
=========== ==========
Such amounts assume that the Term Facilities are fully drawn at the end of
the Term Commitment Period. To the extent that either such Facility is
not, such instalments in respect of that Facility shall be reduced pro
rata.
If any Advance is to be made on 30 June 2002 under either Second Tranche,
the repayment instalment due on that date shall be paid by way of the
Agent deducting the relevant amount from the proceeds of such Advance.
6.2 REPAYMENT OF WORKING CAPITAL ADVANCES
The relevant Working Capital Borrower shall repay each Working Capital
Advance on its Maturity Date in the currency in which it is denominated.
If a Working Capital Advance (the "NEW WORKING CAPITAL ADVANCE") is to be
made on a day on which another Working Capital Advance to the same Working
Capital Borrower (the "MATURING WORKING CAPITAL ADVANCE") is due to be
repaid then, subject to the terms of this Agreement and so long as the
conditions referred to in clause 3 shall have been satisfied in relation
to the new Working Capital Advance:
(a) if the new Working Capital Advance and the maturing Working Capital
Advance are denominated in the same currency, (i) the maturing
Working Capital Advance shall be deemed to have been repaid on its
Maturity Date to the extent of the amount of the new Working Capital
Advance and (ii) to such extent, the principal amount of the new
Working Capital Advance to be made on such date shall be deemed to
have been credited to the account of the relevant Working Capital
Borrower by the Agent on behalf of the Working Capital Banks in
accordance with the terms of this Agreement and the Working Capital
55
Banks shall only be obliged to make available to the relevant
Working Capital Borrower pursuant to clause 4.2(b) a principal
amount equal to the amount (if any) by which the new Working Capital
Advance exceeds the maturing Working Capital Advance and the
relevant Working Capital Borrower shall only be obliged to repay a
principal amount equal to the amount (if any) by which the maturing
Working Capital Advance exceeds the new Working Capital Advance; or
(b) if the maturing Working Capital Advance is denominated in one
currency (the "OLD CURRENCY") and the new Working Capital Advance is
to be denominated in another currency (the "NEW CURRENCY") the Agent
shall apply the moneys in the new currency so to be advanced by the
Working Capital Banks on the Drawdown Date of the new Working
Capital Advance in the purchase of the old currency and apply the
amount of the old currency so purchased in or towards repayment of
the maturing Working Capital Advance in accordance with this clause
6.2(b). If, after such application (i) there shall remain an amount
in the old currency owing from the relevant Working Capital Borrower
to the Working Capital Banks such Working Capital Borrower shall, on
the Maturity Date of the maturing Working Capital Advance, pay to
the Agent for the account of the Working Capital Banks the amount in
the old currency so owing or (ii) there shall remain an amount in
the new currency owing to such Working Capital Borrower by the
Working Capital Banks, the Agent shall forthwith advance to such
Working Capital Borrower, from the moneys in respect of the new
Working Capital Advance advanced to it by the Working Capital Banks,
the amount in the new currency so owing.
On the Termination Date in respect of the Working Capital Facility all
outstanding Working Capital Advances shall in any event be repaid in full.
6.3 REPAYMENT AND DISCHARGE OF ANCILLARY FACILITIES AND LETTERS OF CREDIT
The relevant Borrowers shall repay and/or discharge in full the Ancillary
Facilities Liabilities and outstanding Letters of Credit on the
Termination Date in respect of the Working Capital Facility.
6.4 OPTIONAL PREPAYMENT OF ALL THE BANKS
The relevant Borrowers may, subject to clause 6.7, prepay the Advances,
the Letters of Credit and the Ancillary Facilities at any time after the
Acquisition and the refinancing of the Relevant Liabilities have occurred
(in each case) in whole or part (in minimum amounts of L1,000,000),
without premium or penalty but without prejudice to its obligations under
clauses 6.7(f), 8.5, 13, 14.2 and 14.4.
6.5 OPTIONAL PREPAYMENT OF A BANK
(a) The relevant Borrowers may also prepay (in whole but not in part
only), without premium or penalty, but without prejudice to their
respective obligations under clauses 6.7(f), 8.5, 13, 14.2 and 14.4:
56
(i) (upon notice to the Agent to such effect) the whole of the
Contributions to the Facilities of any Bank to which such
Borrowers shall have become obliged to pay additional amounts
under clauses 8.5 or 14.2; or
(ii) (upon notice to such effect to the Agent within 10 Banking
Days of receipt of the relevant certificate of a Substitute
Basis) the whole of the Contributions to the Facilities of any
Bank to which a Substitute Basis applies by virtue of clause
14.4.
(b) Upon any such notice of such prepayment being given, the Commitments
of the relevant Bank to the Facilities shall be reduced to zero.
6.6 MANDATORY PREPAYMENTS
(a) Prepayment Events:
(i) Unless the Agent (acting on behalf of all of the Banks)
otherwise agrees, the Borrowers shall be obliged to prepay the
Facilities (including the discharge in full of the Ancillary
Facilities Liabilities) in whole immediately upon the
occurrence of a Full Prepayment Event (whether or not also an
Event of Default), whereupon the Total Commitments in respect
of the Facilities shall be reduced to zero.
(ii) Unless the Agent (acting on behalf of all of the Banks)
otherwise agrees, the Borrowers shall be obliged to apply (or
procure that the same are applied) the aggregate net proceeds
of any Flotation which does not constitute a Full Prepayment
Event in or towards prepayment of the Facilities as follows:
(A) the first L100,000,000 of such aggregate net proceeds
shall be applied in or towards prepayment of the
Facilities; and
(B) (thereafter, an amount equal to 50 per cent. of any
other aggregate net proceeds shall be applied in or
towards prepayment of the Facilities.
For the purpose of this clause 6.6(a)(ii) "AGGREGATE NET PROCEEDS"
means the total cash proceeds realised by any Acquisition Party, any
Borrower, the Target and/or other entity the subject of a Flotation,
less the reasonable costs, fees and expenses incurred in connection
with such Flotation. On each occasion that aggregate net proceeds
are received in respect of a Flotation not constituting a Full
Prepayment Event, such aggregate net proceeds shall immediately be
deposited in a Cash Collateral Account with the Cash Collateral
Account Bank and shall be applied in accordance with clauses 6.7(c)
and (d) in prepayment of the Term Advances on the next succeeding
Interest Payment Dates relating to the Term Advances concerned or in
repaying the Working Capital Advances (and reducing the Working
Capital Facility Commitments
57
accordingly) on the next succeeding Maturity Dates or in immediately
prepaying the other Drawings under the Working Capital Facility (and
reducing the Working Capital Facility Commitments accordingly).
(b) Receipts of claims
Unless the Agent (acting on behalf of all of the Banks) otherwise
agrees, Newco 2 will apply (or procure that the same are applied)
all moneys received by it or any other member of the Group (each
such receipt being a "RELEVANT RECEIPT") as proceeds (net of
associated costs and expenses) of any claim against the Second
Vendors in connection with the Second Acquisitions or against any
Third Vendors in connection with any Third Acquisitions or the
writers of the Reports or the Third Reports or any claim in respect
of advice given in relation to the Acquisition and/or the Scheme
and/or the Second Acquisitions and/or the Third Acquisitions, as
follows:
(i) prior to the Enforcement Date the Relevant Receipt shall be
applied:
(A) to the extent the Relevant Receipt relates to a
liability of, or a charge or claim upon, a member of the
Group, in the discharge of that liability, charge or
claim (or in reimbursement of monies disbursed in
connection with such liability, charge or claim)
provided that such moneys shall be properly applied in
such manner within six months of receipt by the relevant
member of the Group; or
(B) to the extent the Relevant Receipt relates to an asset
reasonably required in the conduct of the Group's
business, in the acquisition of that asset provided that
such moneys shall be properly applied in such manner
within six months of receipt by the relevant member of
the Group; or
(C) to the extent the Relevant Receipt exceeds the aggregate
amount required to be applied under (A) or (B) above, in
or towards prepayment and cancellation of the Facilities
in accordance with clause 6.7(c) and (d). Pending every
such application or prepayment, Newco 2 shall procure
that on the date of the Relevant Receipt by a member of
the Group, an amount, or amounts in aggregate, equal to
the Relevant Receipt are placed in one or more Cash
Collateral Accounts with the Cash Collateral Account
Bank; or
(ii) on or after the Enforcement Date the Relevant Receipt shall be
applied in accordance with clause 17.15 (and such moneys shall
be paid to the Security Agent for such purposes) or as the
Security Agent may otherwise direct.
58
6.7 PREPAYMENTS GENERALLY
(a) No prepayment may be made pursuant to clauses 6.4 or 6.5 unless the
relevant Borrower shall have given the Agent 3 Banking Days prior
notice specifying the proposed date of the prepayment and the amount
to be prepaid. Every such notice shall be effective only on actual
receipt by the Agent, shall be irrevocable and shall oblige the
relevant Borrower to make the relevant prepayment on the date
specified.
(b) No amount prepaid under the Facilities (save for voluntary
prepayments of the Working Capital Facility) may be reborrowed.
(c) Subject to clause 6.7(d) and (e), any amount prepaid in respect of
the Facilities shall be applied first against the Term Advances on a
pro rata basis, secondly in reduction of the Working Capital
Advances and the Letters of Credit on a pro rata basis and thirdly
in prepaying the Ancillary Facilities. Where a mandatory prepayment
is applied against the Working Capital Advances, the Letters of
Credit and/or the Ancillary Facilities, upon such prepayments or
discharge the Commitments in respect of the Working Capital Facility
and/or the relevant Ancillary Commitments (as applicable) shall be
cancelled by the amount prepaid or discharged.
(d) Newco 2 may, by giving to the Agent 3 Banking Days prior notice,
select whether voluntary prepayments and mandatory prepayments of up
to an aggregate amount of L25,000,000 from and after the UK Second
Acquisition Completion Date, are to be applied in reducing the
repayment instalments for the Term Advances in order of maturity,
inverse order of maturity or on a pro rata basis. If no such
selection is made, the relevant prepayments shall be applied in
reducing such repayment instalments pro rata.
(e) Subject to the operation of clause 6.7(d), where a mandatory
prepayment is applied against a Term Facility, it shall reduce the
future repayment instalments under that Term Facility pro rata.
(f) All prepayments shall be made together with (to the extent these
relate to the amounts prepaid) (i) accrued interest to the date of
prepayment (calculated, in the case of any prepayment of a Bank's
Contributions to the Facilities pursuant to clause 6.5(a)(ii) and in
respect of the period during which the relevant Substitute Basis has
applied by virtue of clause 14.4(b), at a rate per annum equal to
the rate certified by such Bank to be an interest rate equivalent to
the aggregate of (A) the applicable Margin and (B) the cost
(including Additional Cost) to such Bank of funding its
Contributions to the Facilities for such period); (ii) any
additional amount payable under clauses 8.5 or 14.2 attributable to
the amounts prepaid; and (iii) all other sums payable by the
relevant Borrower to the relevant Banks under this Agreement
attributable to the amounts prepaid including, without limitation,
any accrued commitment commission payable under clause 7.2 and any
amounts payable under clause 13.1.
59
(g) Upon any prepayment being made (other than a prepayment under clause
6.5), the Commitments of the relevant Banks in respect of the
relevant Facility shall be reduced accordingly (pro-rata the
relevant Banks' respective Commitments in respect of the relevant
Facility).
(h) The Borrowers may not make any prepayments in respect of any
Facility save as expressly provided in this Agreement.
(i) Notwithstanding the provisions of this clause 6.7, while (and to the
extent that) any Facility A Advances are outstanding, any Facility B
Bank shall be entitled to waive its right to receive any prepayment
of its share of the Facility B Advances which would have arisen by
reason of the occurrence of any of the events or circumstances
referred to in clauses 6.6, 6.10, 6.11, 6.12 or 10.6(f)(xii) in
which case this clause 6.7 shall apply without having regard to the
Facility B Advances owing to such Bank.
6.8 VOLUNTARY CANCELLATION OF THE WORKING CAPITAL FACILITY
Newco 2 may at any time prior to the Termination Date in respect of the
Working Capital Facility by notice to the Agent (effective only on actual
receipt) cancel, with effect from a date not less than 5 Banking Days
after the receipt by the Agent of such notice, the whole or any part
(being L100,000 or any larger sum which is an integral multiple of
L25,000) of the Available Facility Amount which is not the subject of a
Drawdown Notice at such time. Any such notice of cancellation, once given,
shall be irrevocable and upon such cancellation taking effect the
Commitments of the Working Capital Banks shall be reduced accordingly
(pro-rata to their respective Commitments in respect of the Working
Capital Facility).
6.9 MANDATORY CANCELLATION
[Not restated]
6.10 APPLICATION OF DISPOSAL PROCEEDS
(a) Subject to clause 6.10(b), unless the Agent (acting on behalf of all
of the Banks) otherwise agrees, Newco 2 shall procure that an amount
equal to the Net Proceeds of each relevant disposal (other than, for
the avoidance of doubt, any amounts subject to a valid Reinvestment
Notice) and each mandatory disposal are, as soon as practicable and
in any event no later than 5 Banking Days after their receipt by a
member of the Group, deposited in a Cash Collateral Account with the
Cash Collateral Account Bank and shall be applied in prepaying the
Facilities in accordance with clauses 6.7(c) and (d) in prepayment
of the Term Advances on the next succeeding Interest Payment Dates
relating to the Term Advances concerned or in repaying the Working
Capital Advances (and reducing the Working Capital Facility
Commitments accordingly) on the next succeeding Maturity Dates or in
immediately prepaying the other Drawings under the Working Capital
Facility (and reducing the Working Capital Facility Commitments
accordingly).
60
(b) Newco 2 may apply the Net Proceeds of a relevant disposal which are
the subject of a valid Reinvestment Notice in or towards a permitted
application within six months of the relevant disposal. The amount
of Net Proceeds that are subject to Reinvestment Notices shall not
exceed L10,000,000 in aggregate in respect of any financial year of
Newco 2.
(c) Unless the Agent (acting on behalf of all of the Banks) otherwise
agrees, Newco 2 shall procure that any unapplied Net Proceeds of a
relevant disposal and all Net Proceeds of each mandatory disposal
are applied in prepaying the Facilities.
For the purposes of this clause 6.10:
(i) a "RELEVANT DISPOSAL" means a disposal permitted under clause
10.6(f)(iii) (and no other paragraph thereof) in any case which
results in Net Proceeds in excess of L750,000 (or its Sterling
equivalent at the date of receipt) provided that the aggregate
Sterling equivalent of the gross proceeds of such disposals excluded
from this definition of relevant disposal shall not exceed
L3,000,000 in any financial year of Newco 2;
(ii) a "MANDATORY DISPOSAL" means any disposal of any ownership interests
in or assets of a Target Group (as defined in the Senior
Subordinated Facility Agreement) or the ownership interests in or
assets of any member of the Group as a result of any Third
Acquisition, which disposal is required to be made by any relevant
competition authority (or is in order to mitigate against any
proceedings, investigation, examination or enquiry by such a
competition authority);
(iii) "UNAPPLIED NET PROCEEDS" means, in respect of a relevant disposal
which is not a mandatory disposal, those Net Proceeds (or their
Sterling equivalent at the date of receipt, if denominated in a
currency other than Sterling) of such relevant disposal which are
subject to a valid Reinvestment Notice and which, as at the end of
the period of six months after the date of such relevant disposal
or, in respect of up to L6,300,000 of Net Proceeds of relevant
disposals which is at the date on which the Majority Banks consented
to the requests contained in the consent request letter dated 2
October 2003, deposited in a Cash Collateral Account, the period
ending on 16 October 2004 ("EXISTING NET PROCEEDS") (or, if earlier,
as at the date on which Newco 2 notifies the Agent that the Group no
longer intends and expects to use all or the relevant portion of the
Net Proceeds concerned towards a permitted application) have not
been applied in a permitted application;
(iv) a "PERMITTED APPLICATION" means any of (A) the acquisition of a
replacement fixed asset of the same or a similar type and of
comparable or superior value and quality or (B) the acquisition of a
fixed asset the commercial purpose and effect of which is to replace
or improve upon the commercial purpose and effect of the fixed asset
disposed of or (C) the acquisition of fixed assets of comparable or
superior quality for another aspect of the Group's business,
provided in each case, (to the extent permitted by law) that such
fixed asset is subject to a fully
61
enforceable legally binding Encumbrance in favour of the Security
Agent and the other Finance Parties equivalent to or better than the
Encumbrance (if any) to which to asset, the disposal of which
resulted in the Net Proceeds which are being so applied, was subject
and provided further that the only permitted application in respect
of the Existing Net Proceeds is the application thereof in or
towards satisfying the acquisition consideration in respect of
Permitted Acquisitions; and
(v) a "REINVESTMENT NOTICE" means, in respect of the Net Proceeds of a
relevant disposal which is not a mandatory disposal, a written
notice executed by a director or the treasurer of Newco 2 and
received by the Agent no later than 5 Banking Days after receipt of
such Net Proceeds by a member of the Group which confirms that no
Event of Default has occurred and is continuing and that a member of
the Group intends and expects to use all or the relevant portion of
the Net Proceeds of the relevant disposal concerned towards a
permitted application.
6.11 CASH SWEEP
Unless the Agent (acting on behalf of all of the Banks) otherwise agrees,
Newco 2 shall on the next succeeding Interest Payment Dates in respect of
the Term Advances following the delivery to the Agent of the audited
annual consolidated financial statements of the Group and the Auditors'
statement pursuant to clause 10.1(b)(i) and 10.1(b)(iv) in respect of each
financial year ending on or after 31 December 2000 apply or procure that
there is applied in prepayment of such Term Advances (without premium or
penalty) an amount equal to a percentage of the Consolidated Excess Cash
Flow in respect of such financial year determined according to the ratio
of Total Net Debt to Consolidated EBITDA (determined in accordance with
schedule 8 and clause 10.3) as at the end of the financial year to which
such financial statements relate.
Total Net Debt: Consolidated % of Consolidated Excess Cash Flow to be
EBITDA prepaid
-------------------------------------------- ----------------------------------------
greater than or equal to 4.5:1 75%
greater than or equal to 3.0:1 but less than
4.5:1 50%
less than 3.0:1 25%
6.12 CITADEL INSURANCE COMPANY LIMITED
Newco 2 shall procure that any cash which is surplus to the reasonable
cash requirements of Citadel Insurance Company Limited (including, without
limitation, all cash which is in excess of the amount required from time
to time as cash collateral in respect of insurance policies written by
Citadel Insurance Company Limited) shall be invested in Newco 2 either by
way of the subscription for ordinary shares in Newco 2 or by way of
shareholder loans to Newco 2 which are subordinated on the same terms as
provided for in the
62
Target/Newco 2 Subordination Deed. Newco 2 undertakes to immediately
deposit the proceeds of any such subscription or shareholder loan in a
Cash Collateral Account with the Cash Collateral Account Bank and shall
apply such proceeds in accordance with clauses 6.7(c) and (d) in
prepayment of the Term Advances on the next succeeding Interest Payment
Dates relating to the Term Advances concerned or in repaying the Working
Capital Advances (and reducing the Working Capital Facility Commitments
accordingly) on the next succeeding Maturity Dates or in immediately
prepaying the other Drawings under the Working Capital Facility (and
reducing the Working Capital Facility Commitments accordingly).
7 FEES AND EXPENSES
7.1 ARRANGEMENT, UNDERWRITING AND AGENCY FEES
Newco 2 shall pay to the Agent or shall procure that there is paid:
(a) on the UK Second Acquisition Completion Date, an arrangement and
underwriting fee of the amount agreed by Newco 2 with the Amendment
Arrangers and the Amendment Underwriters in the Second Fee Letters;
and
(b) on the UK Second Acquisition Completion Date and (in advance) on
each anniversary thereof until no amount is outstanding under this
Agreement and no Commitment is in force, for the account of the
Agent, a facility agent fee of the amounts agreed by Newco 2 with
the Agent in the Second Fee Letters.
7.2 COMMITMENT FEES
Newco 2 shall pay to the Agent, or shall procure that there is paid to the
Agent:
(a) [Not restated]
(b) Working Capital Facility
On the first Drawdown Date and thereafter on the dates falling at 3
monthly intervals after the date of this Agreement during the
Working Capital Commitment Period and on the Termination Date in
respect of the Working Capital Facility, for the account of the
Working Capital Banks (pro-rata their relevant Commitments),
commitment commission computed at the applicable Commitment
Commission Rate on the daily amount by which the Total Commitments
in respect of the Working Capital Facility (excluding Ancillary
Commitments) exceed the aggregate Sterling Amount of the Working
Capital Advances and the Sterling Amount of all outstanding Letters
of Credit at that time.
7.3 EXPENSES
Newco 2 shall pay to the Agent:
63
(a) all reasonable out-of-pocket expenses (including but not limited to
expenses incurred in connection with the Reports), of the Agent,
Security Agent, the Arrangers, the Documentation Agent, the
Underwriters and their Affiliates associated with the transactions
contemplated by this Agreement, including but not limited to (i) the
syndication of the Facilities and publicity associated therewith,
(ii) the preparation, execution and delivery, administration,
waiver, modification and enforcement of the Finance Documents
(including documentary taxes and the reasonable fees, disbursements
and other charges of counsel and consultants) and (iii) all
reasonable costs of any investigation, litigation or subpoena
arising out of the transactions contemplated hereby or the
Acquisition or the Second Acquisitions; and
(b) after a Default has occurred and whilst it is continuing, on demand,
all reasonable expenses (including legal and out-of-pocket expenses)
incurred by any of the Finance Parties in contemplation of, or
otherwise in connection with, the enforcement or attempted
enforcement of, or preservation or attempted preservation of any
rights under, any of the Finance Documents, or otherwise in respect
of the recovery, or attempted recovery, of moneys owing under the
same.
7.4 VALUE ADDED TAX
All fees and expenses payable pursuant to clause 5 and this clause 7 shall
be paid together with an amount equal to any value added tax thereon
payable by any of the Finance Parties in respect of such fees and
expenses. Any value added tax chargeable in respect of any services
supplied by any Finance Party under any of the Finance Documents shall, on
delivery of a value added tax invoice, be paid in addition to any sum
agreed to be paid under any of the Finance Documents.
7.5 STAMP AND OTHER DUTIES
Newco 2 shall pay all stamp, documentary, registration, notarisation or
other duties or Taxes (including any duties or Taxes payable by, or
assessed on, the Finance Parties) imposed on or in connection with the
negotiation, preparation and execution of any of the Finance Documents and
shall indemnify the Finance Parties against any liability arising by
reason of any delay or omission by Newco 2 to pay such duties or Taxes.
8 PAYMENTS AND TAXES; ACCOUNTS AND CALCULATIONS
8.1 NO SET-OFF OR COUNTERCLAIM; DISTRIBUTION TO THE BANKS
All payments to be made by any Borrower under this Agreement shall be made
in full, without any set-off or counterclaim whatsoever and, subject as
provided in clause 8.5, free and clear of any deductions or withholdings,
in the currency in which payment is due on the due date to the account of
the Agent at such bank in such place as the Agent may from time to time
specify for this purpose, in the case of Sterling, in immediately
available funds, and, in any other case, in such funds as may be generally
accepted for settlement of transactions of this kind.
64
Save where this Agreement provides for a payment to be made for the
account of a particular Finance Party, in which case the Agent shall
distribute the relevant payment to the relevant Finance Party concerned,
payments to be made by any Borrower under this Agreement shall be for the
account of all the Banks and the Agent shall forthwith distribute such
payments in like funds as are received by the Agent to the Banks rateably
in accordance with their Commitments or Contributions, as the case may be.
Such distribution by the Agent shall be good discharge to any such
Borrower.
8.2 PAYMENTS BY THE BANKS
All sums to be advanced by the Banks to a Borrower under this Agreement
shall be remitted, in the case of Sterling, in immediately available
funds, and, in any other case, in such funds as may be generally accepted
for settlement of transactions of this kind on the relevant Drawdown Date
to the account of the Agent at such bank as the Agent may have notified to
the Banks and shall, in the case of the Term Advances, be applied in
accordance with the irrevocable instructions contained in clauses
4.1(a)(iii) and 4.1(b)(iii) and, in the case of any other such sum, be
paid by the Agent on such date in like funds as are received by the Agent
to the account of the relevant Borrower specified in the relevant Drawdown
Notice.
8.3 NON-BANKING DAYS
When any payment under this Agreement would otherwise be due on a day
which is not a Banking Day, the due date for payment shall be postponed to
the next following Banking Day unless such Banking Day falls in the next
calendar month in which case payment shall be made on the immediately
preceding Banking Day.
8.4 AGENT MAY ASSUME RECEIPT
Where any sum is to be paid under this Agreement to the Agent for the
account of another person, the Agent may (unless a notice is received by
it to the contrary prior to the time the relevant payment was expected to
be made) assume that the payment will be made when due and may (but shall
not be obliged to) make such sum available to the person so entitled. If
it proves to be the case that such payment was not made to the Agent, then
the person to whom such sum was so made available shall on request refund
such sum to the Agent together with interest thereon sufficient to
compensate the Agent for the cost of making available such sum up to the
date of such repayment and the person by whom such sum was payable shall
indemnify the Agent for any and all loss or expense which the Agent may
sustain or incur as a consequence of such sum not having been paid on its
due date.
8.5 GROSSING-UP FOR TAXES
If at any time any Borrower is required by law or regulation to make any
deduction or withholding in respect of Taxes from any payment due under
this Agreement or any of the Borrower Security Documents for the account
of any Finance Party (or if the Agent, or as the case may be, the Security
Agent is
65
required to make any such deduction or withholding from a payment to a
Finance Party), the sum due from the relevant Borrower in respect of such
payment shall, subject to clause 8.6, be increased to the extent necessary
to ensure that, after the making of such deduction or withholding, each
Finance Party receives on the due date for such payment (and retains, free
from any liability in respect of such deduction or withholding) a net sum
equal to the sum which it would have received had no such deduction or
withholding been required to be made and such Borrower shall indemnify
each Finance Party against any losses or costs incurred by any of them by
reason of any failure of such Borrower to make any such deduction or
withholding or by reason of any increased payment not being made on the
due date for such payment. Each relevant Borrower shall as promptly as
possible deliver to the Agent copies of any receipts, certificates or
other reasonable proof evidencing the amounts (if any) paid or payable in
respect of any such deduction or withholding. The obligation of any
Borrower to make any increased payment under this clause 8.5 shall survive
termination of this Agreement for a period of nine months after such
termination.
8.6 QUALIFYING BANKS
Each Bank agrees promptly to notify the Agent and Newco 2 if it is not or
ceases to be a Qualifying Bank. If any Bank is not or ceases to be a
Qualifying Bank, then (save in circumstances where such Bank ceases to be
a Qualifying Bank by reason of any change in law, regulation or double
taxation treaty or in its application or interpretation, in each case
taking effect after the date of this Agreement or the date such Bank
becomes a party to this Agreement, if later) no Borrower shall be liable
to pay to that Bank under clause 8.5 any sum in excess of the sum it would
have been obliged to pay if that Bank had been, or had not ceased to be, a
Qualifying Bank.
Each Bank agrees that it will, as soon as is reasonably practicable after
the date of this Agreement, or, if later, the date on which such Bank
becomes a party to this Agreement, complete and file with the Taxation
authority of the country in which it is resident for the purposes of
Taxation, such forms (if any) which will enable interest to be paid
without withholding or deduction for or on account of Taxes of the United
Kingdom, and that, if such forms are returned to such Bank by its Taxation
authority, it will, as soon as reasonably practicable thereafter, file
such forms with the Inland Revenue.
8.7 CLAW-BACK OF TAX BENEFIT
If, following any such deduction or withholding as is referred to in
clause 8.5 any Finance Party shall receive or be granted a credit against
or remission for any Taxes payable by it, such Finance Party shall,
subject to the relevant Borrower having made any increased payment in
accordance with clause 8.5 and to the extent that such Finance Party can
do so without prejudicing the retention of the amount of such credit or
remission and without prejudice to the right of such Finance Party to
obtain any other relief or allowance which may be available to it,
reimburse the relevant Borrower with such amount as such Finance Party
shall in its absolute discretion certify to be the proportion of such
credit or remission as will leave such Finance Party (after such
reimbursement)
66
in no worse position than it would have been in had there been no such
deduction or withholding from the payment by the relevant Borrower as
aforesaid. Such reimbursement shall be made forthwith upon such Finance
Party certifying that the amount of such credit or remission has been
received by it. Nothing contained in this Agreement shall oblige any
Finance Party to investigate whether a Tax credit is payable, rearrange
its tax affairs or to disclose any information regarding its tax affairs
and computations. Without prejudice to the generality of the foregoing, no
Borrower shall, by virtue of this clause 8.7, be entitled to enquire about
any Finance Party's tax affairs.
8.8 BANK ACCOUNTS
Each Bank and Ancillary Facilities Bank shall maintain, in accordance with
its usual practices, an account or accounts evidencing the amounts from
time to time lent by, owing to and paid to it under this Agreement or its
Ancillary Facilities Letter or any of the Borrower Security Documents. The
Agent shall maintain a control account showing the utilisation of the
Facilities (other than the Ancillary Facilities), including (separately)
each Tranche, and other sums owing by each Borrower under this Agreement
and all payments in respect thereof made by each Borrower from time to
time. The control account shall, in the absence of manifest error, be
conclusive evidence as to the amount from time to time owing by each
Borrower under this Agreement.
8.9 PARTIAL PAYMENTS
If, (i) on any date on which a payment is due to be made by any Borrower
under this Agreement, the amount received by the Agent from such Borrower
falls short of the total amount of the payment due to be made by such
Borrower on such date or (ii) on any date on which the Agent receives any
payment from the Security Agent or otherwise receives any amount
representing proceeds of realisations or other recoveries under any of the
Security Documents, the amount of such payment or other receipt falls
short of the total amount owing to the Finance Parties under this
Agreement on such date then (in any such case), without prejudice to any
rights or remedies available to the Finance Parties under any of the
Finance Documents, the Agent shall apply the amount actually received by
it in or towards discharge of the obligations of such Borrower under this
Agreement in the following order, notwithstanding any appropriation made,
or purported to be made, by such Borrower:
(a) first, in or towards payment, on a pro-rata basis, of any unpaid
costs and expenses (ignoring any fees payable under clause 7.1(a) or
(b)) of the Agent, Security Agent, Arrangers, Documentation Agent or
Underwriters under this Agreement;
(b) secondly, in or towards payment to the Finance Parties, on a
pro-rata basis, of any amount owing to the Finance Parties under
clause 17.12;
(c) thirdly, in or towards payment to the Arrangers of any portion of
the arrangement fee payable under clause 7.1(a) which remains
unpaid;
67
(d) fourthly, in or towards payment to the Agent of any portion of the
agency fee payable under clause 7.1(b) which remains unpaid;
(e) fifthly, in or towards payment to the Finance Parties, on a pro-rata
basis, of any accrued commitment commission payable under clause 7.2
which shall have become due but remains unpaid;
(f) sixthly, in or towards payment to the Finance Parties, on a pro-rata
basis, of any accrued interest, letter of credit commission or
Fronting Bank fees which shall have become due but remain unpaid but
so that any amount payable by virtue of clause 8.5 shall be
excluded;
(g) seventhly, in or towards payment to the Finance Parties, on a
pro-rata basis, of any principal payable to the Finance Parties
which shall have become due but remains unpaid;
(h) eighthly, in or towards payment to any such Finance Parties, on a
pro-rata basis, of any amount payable to any Finance Parties by
virtue of clause 8.5 which remains unpaid; and
(i) ninthly, in or towards payment of any other sum which shall have
become due but remains unpaid (and, if more than one such sum so
remains unpaid, on a pro-rata basis).
Each reference in clauses 8.9(a) to (e) (inclusive) to a category of
unpaid sums shall include interest thereon payable in accordance with this
Agreement (including, without limitation, default interest under clause
5.3). Accordingly, clause 8.9(f) shall be construed as referring to
interest on principal and accrued interest thereon which remains unpaid to
the extent due.
The order of application set out in clauses 8.9(e) to 8.9(i) shall be
varied by the Agent if the Majority Banks so direct, without any reference
to, or consent or approval from, any Borrower.
8.10 CALCULATIONS
All interest and other payments of an annual nature under this Agreement
or any of the Borrower Security Documents shall accrue from day to day and
be calculated on the basis of actual days elapsed and (in the case of
Sterling) a 365 day year and (in the case of currencies other than
Sterling) a 360 day year (or as is otherwise the relevant interbank market
custom in respect of any such currency). In calculating the actual number
of days elapsed in a period which is one of a series of consecutive
periods with no interval between them or a period on the last day of which
any payment falls to be made in respect of such period, the first day of
such period shall be included but the last day excluded.
8.11 CERTIFICATES CONCLUSIVE
Any certificate of, or determination by, a Finance Party as to any rate of
interest or any other amount payable under, or otherwise to be determined
under, this Agreement or any of the Borrower Security Documents shall, in
the absence of
68
manifest error, be conclusive and binding on each Borrower and (in the
case of a certificate of or determination by the Agent) on the Banks.
8.12 EFFECT OF EUROPEAN MONETARY UNION
If the United Kingdom participates in Economic and Monetary Union in
accordance with Article 109j of the Treaty on European Union, then:
(a) if, and at any time while, Sterling and the euro are at the same
time recognised by the Bank of England as the lawful currency of the
United Kingdom, any amount expressed to be payable under this
Agreement in Sterling shall be paid in Sterling or in euro as (i)
the Agent may (in the case of any amount payable by the Banks) by
not less than three Banking Days' notice to Newco 2 and the Banks to
that effect elect or (ii) Newco 2 may (in the case of any amount
payable by the Borrowers) by not less than three Banking Days notice
to the Agent to that effect elect;
(b) any amount so elected to be paid in euro shall be converted from
Sterling at the rate stipulated pursuant to Article 109l(4) of the
Treaty and payment of the amount in euro derived from such
conversion shall discharge the obligation of the relevant party to
pay Sterling; and
(c) the Agent, Newco 2 and the Banks shall consult to consider what (if
any) changes are required to be made to this Agreement to (i) take
account of the participation of the United Kingdom in monetary union
and/or (ii) reflect any consequential changes in market practice
(including, without limitation, the settlement of or rounding of
obligations and the calculation of interest). If, after such
consultation, the Agent (acting on the instructions of the Majority
Banks) reasonably and in good faith considers that any such
amendments are required, the Agent shall notify Newco 2 and the
Banks of the amendments which it considers to be necessary and,
notwithstanding clause 17.11, shall be entitled to make such
amendments as to put the parties in the same position as if
participation had not occurred.
Any amendment so made to this Agreement by the Agent shall be promptly
notified to the Banks, the Arrangers and Newco 2 by the Agent and shall be
binding on all the parties to this Agreement.
9 REPRESENTATIONS AND WARRANTIES
9.1 REPEATING REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants (subject to the qualifications and
reservations set out in the Legal Opinions (other than those relating to
factual matters) and matters fairly and specifically disclosed by the
Reports) to each Finance Party in respect of itself and, in the case of
Newco 2 only, in respect of itself, the Target and each other member of
the Group that:
(a) Due incorporation: it and the other members of the Group from time
to time and the Target are duly incorporated and validly existing
under the
69
laws of the respective jurisdictions of their incorporation and have
power to carry on their respective businesses as they are now being
conducted and to own their respective property and other assets;
(b) Corporate power: it and the other members of the Charging Group and
the Target have power to execute, deliver and perform their
respective obligations under each of the Finance Documents to which
they are parties and (in the case of the Borrowers) to borrow the
Commitments and to perform the Hedge Transactions to which they are,
or may become, party; all necessary corporate, shareholder and other
action has been taken to authorise the execution, delivery and
performance of the same and no limitation on the powers of any
Borrower to borrow or perform hedging transactions will be exceeded
as a result of any transaction under any of the Credit Documents and
no limitation on any of their respective powers to give guarantees
and/or to create security will be exceeded as a result of the
execution and delivery of any of the Security Documents;
(c) Binding obligations: (i) each of the Finance Documents when executed
and delivered by it and/or any other member of the Charging Group
and/or the Target, as the case may be, will constitute, valid,
legally binding and enforceable obligations of it and all other
members of the Charging Group and the Target in accordance with
their respective terms and, in the case of the Security Documents,
create the security interests purported to be created thereby and
(ii) it is not necessary, to ensure the legality, validity,
enforceability or admissibility in evidence of any of the Finance
Documents that they or any other instrument be notarised, filed,
recorded, registered or enrolled in any court, public office or
elsewhere in the jurisdiction(s) of incorporation of the member(s)
of the Group party thereto or, as the case may be, the Target or
that any stamp, registration or similar tax or charge be paid in
such jurisdictions on or in relation to the Finance Documents and
the Finance Documents are in proper form for their enforcement in
the courts of such jurisdictions;
(d) No conflict with other obligations: the execution and delivery of,
the performance of its obligations under, and compliance with the
provisions of, the Finance Documents by it and all other members of
the Charging Group and the Target will not (i) contravene any
existing applicable law, statute, rule or regulation or any
judgment, decree or permit to which any of them are subject, (ii)
conflict with, or result in any breach of any of the terms of, or
constitute a default under, any agreement or other instrument to
which any of them are a party or are subject or by which any of
their property is bound to the extent that such conflict or breach
would have, or would be reasonably likely to have, a Material
Adverse Effect, (iii) contravene or conflict with any provision of
their respective Memorandum or Articles of Association or, as the
case may be, other relevant incorporation documents or by-laws or
(iv) result, other than pursuant to the provisions of any of the
Finance Documents, in the creation or imposition of, or oblige any
member of the Group or the
70
Target to create, any Encumbrance (save for a Permitted Encumbrance)
on any member of the Group's assets, rights or revenues;
(e) Choice of law: the choice by the Borrowers and the Charging Group
members and the Target (as appropriate) of English law or, as the
case may be, any other law as expressly set out in the relevant
Finance Document to govern each of the Finance Documents which are
expressed to be governed by English law or such other law, as the
case may be, and the submissions to jurisdictions by the Borrowers
and the Charging Group members and the Target contained in the
Finance Documents are valid and binding in all material respects;
(f) Audited financial statements: the then latest audited financial
statements delivered to the Agent under clause 10.1(b)(i) have been
prepared in accordance with the Appropriate Accounting Principles
which have been consistently applied and present fairly and
accurately the financial position of Newco 2, the consolidated
financial position of the Group, the Target and Newco 1 respectively
as at the date to which such financial statements were made up and
the results of the operations of Newco 2 the Group, the Target and
Newco 1 respectively for the financial year ended on such date and,
as at such date, neither Newco 2 nor any of the other members of the
Group nor the Target nor Newco 1 had any significant liabilities
(contingent or otherwise) or any unrealised or anticipated losses
which are not disclosed by, or reserved against in, such financial
statements (or the notes thereto) to the extent required by the
Appropriate Accounting Principles; and
(g) Material adverse change: since 31 December 2001 there has been no
development or event which has had or could reasonably be expected
to have a Material Adverse Effect.
9.2 NON-REPEATING REPRESENTATIONS AND WARRANTIES
Newco 2 further represents and warrants to each of the Finance Parties
(subject to the qualifications and reservations set out in the Legal
Opinions (other than those relating to factual matters) and the matters
fairly and specifically disclosed by the Reports) that:
(a) Historic financial statements: (i) the audited consolidated
financial statements of the Target Group for the financial year
ended 31 December 1998, have been prepared in accordance with
generally accepted accounting principles and practices in the United
Kingdom which have been consistently applied and present fairly and
accurately the consolidated financial position of the Target Group
as at the date down to and as of which such statements were prepared
and the consolidated results of the operations of the Target Group
for the period to which such statements relate; and (ii) as at 31
December 1998, the Target Group did not have any significant
liabilities (contingent or otherwise) or any significant unrealised
anticipated losses which are not disclosed by, or reserved against
in, such financial statements (or the notes thereto);
71
(b) Information Package:
(i) all factual information concerning ▇▇▇▇▇ Muse, each of the
Acquisition Parties and the Target and its Affiliates and the
transactions contemplated by this Agreement (other than
information of a general economic nature) that is or has been
made available to any of the Finance Parties by any of the
Acquisition Parties or any of their authorised representatives
in relation to this Agreement when taken as a whole is
complete and correct in all material respects and does not
contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the
statements contained therein not materially misleading in
light of the circumstances under which such statements are
made; and
(ii) all financial projections which have been prepared by Newco 2
and made available to any Finance Party or prospective Finance
Party have been prepared in good faith and based upon
assumptions which Newco 2 believed to be reasonable at the
time prepared;
(c) Copies of documents to be true and accurate: the copies of the
Transaction Documents and the other relevant incorporation and
constitutional documents or by-laws of it and all other members of
the Charging Group and the Target delivered to the Agent in
accordance with schedule 3 are true, complete and accurate in all
material respects and have not been amended, varied or supplemented
in any way and, save as otherwise referred to therein, no other
agreements, arrangements or understandings exist between any
Acquisition Party or any member of the HMTF Group and all or any of
the parties to those agreements and instruments which would
materially affect the transactions or arrangements contemplated by
the Transaction Documents and/or the forecasts, projections and/or
estimates contained or referred to in the Accountants' Report and/or
the Financial Model;
(d) Target Group: the details of the Target Group set out in schedule 6
and appearing in schedule 7 are accurate in all material respects
and (i) Cayman 1 has no, and did not have immediately after the
Effective Date any, interest in the share capital of any body
corporate other than Newco 1 and the Target, (ii) Cayman 2 has no,
and did not have immediately after the Effective Date any, interest
in the share capital of any body corporate other than the Target,
(iii) Newco 1 has no, and did not have immediately after the
Effective Date any, interest in the share capital of any body
corporate other than Newco 2 and (iv) Newco 2 has no, and did not
have immediately after the Effective Date any, interest in the share
capital of any body corporate other than the Target;
(e) No Borrowed Money or Encumbrances: (i) none of Newco 2 and the other
members of the Group have any liabilities in respect of Borrowed
Money other than as permitted under clause 10.6(c) and (ii) no
72
Encumbrances (other than Permitted Encumbrances) exist over the
assets and undertaking of Newco 2 or any other member of the Group;
(f) Consents etc. relating to the Finance Documents: every consent,
authorisation, licence or approval of, or filing, notarisation or
registration required to ensure compliance by Newco 2 with, clause
10.2(b) has been obtained or made and will be in full force and
effect and there will have been no default in the observance of the
conditions or restrictions (if any) imposed in, or in connection
with, any of the same;
(g) Compliance with consents etc relating to the business of the Group:
(i) the business of the Target Group has been conducted in all
material respects in accordance with all applicable laws and
regulations in each of the jurisdictions in which it is
carried on and there is no decree or judgment of any
Government Entity of any of such jurisdictions outstanding
against any member of the Target Group except to the extent
that any non compliance or decree or judgment would not be
reasonably likely to have a Material Adverse Effect; and
(ii) as at the Effective Date every material consent,
authorisation, licence or approval required by the Target
Group to ensure compliance by Newco 2 with clause 10.2(c) in
respect of the business carried on by the Target Group
immediately after the Effective Date has been obtained or made
and will be in full force and effect at the Effective Date and
there has been no default in the observance of the conditions
or restrictions (if any) imposed in, or in connection with,
any of the same except to the extent any failure to obtain or
make or maintain in full force and effect or default would not
be reasonably likely to have a Material Adverse Effect;
(h) No share options etc: (other than agreements to call for the issue
of shares in the Target which will be cancelled pursuant to the
Scheme) there are no agreements in force or corporate resolutions
passed which call for the present or future issue or allotment of,
or grant to any person the right (whether conditional or otherwise)
to call for the issue or allotment of, any share or loan capital of
Newco 2 or any other member of the Group (including any option or
right of pre-emption or conversion) (other than, in favour of
another member of the Group where such other member of the Group may
not transfer or renounce such rights to or in favour of a person who
or which is not a member of the Group);
(i) No Taxes: no Taxes are imposed by withholding or otherwise on any
payment to be made by any Borrower under this Agreement or any of
the Borrower Security Documents or are imposed on or by virtue of
the execution or delivery by any Borrower of this Agreement or any
of the Borrower Security Documents or any document or instrument to
be executed or delivered under this Agreement or any of the Borrower
Security Documents;
73
(j) Litigation/labour disputes: no litigation, alternative dispute
resolution, arbitration or administration proceeding is taking place
or, to the knowledge of the officers of any Acquisition Party,
threatened against any Acquisition Party or any member of the Target
Group. No labour disputes involving any member of the Target Group
are current or threatened, to the knowledge of the officers of any
Acquisition Party in each case to the extent that the same would be
reasonably likely to have a Material Adverse Effect;
(k) Environmental matters:
(i) Newco 2 is in compliance with the undertakings set out in
clause 10.2(j), in each case in respect of all members of the
Group;
(ii) no member of the Group has received notice of any
Environmental Claim and no member of the Group is not in
compliance with any Environmental Law or any Environmental
Approval to the extent that the same would be reasonably
likely to have a Material Adverse Effect; and
(iii) there is no Environmental Claim pending or threatened against
any member of the Group which, if adversely determined, would
be reasonably likely to have a Material Adverse Effect;
(l) No Default: no Default has occurred and is continuing and no member
of the Group is in breach or in default under any agreement to which
it is a party or which is binding on it or any of its assets to an
extent or in a manner which could reasonably be expected to have a
Material Adverse Effect;
(m) Intellectual Property Rights:
(i) each member of the Group owns or has licensed to it on arm's
length commercial terms all the Intellectual Property Rights
which are required by it in order for it to carry on its
business as it is being conducted and as contemplated in the
Financial Model and to the Acquisition Parties' knowledge none
of the members of the Group have infringed any Intellectual
Property Rights of any third party in any material respect to
the extent that the same would have or would be reasonably
likely to have a Material Adverse Effect;
(ii) each member of the Group has taken all reasonable actions
(including payment of fees) required to maintain in full force
and effect and to preserve its ability to enforce any
registered Intellectual Property Rights owned by or licensed
to it except to the extent any failure to take such action
would not be reasonably likely to have a Material Adverse
Effect. There has been no material infringement or threatened
infringement by any person of any Intellectual Property Rights
owned by or licensed to any
74
member of the Group to the extent that the same would be
reasonably likely to have a Material Adverse Effect;
(iii) no event or circumstance has occurred which has or could give
rise to the termination of or materially adversely affect the
rights of any member of the Group under or in relation to any
agreement or arrangement relating to any Intellectual Property
Rights to which any of them is a party including (without
limit) any licence to any of them to the extent that the same
would be reasonably likely to have a Material Adverse Effect;
(iv) to the Acquisition Parties' knowledge no disclosure has been
or will be made of any trade secret used or required in
relation to the business of any member of the Group other than
under enforceable confidentiality undertakings and each member
of the Group will take all necessary steps (including legal
proceedings) to enforce the confidentiality of and prevent any
improper use of the same other than where any failure to do so
would not be reasonably likely to have a Material Adverse
Effect;
(n) Euro Compliance:
[Not restated];
(o) Year 2000 compliance:
[Not restated]; and
(p) Clean company: prior to the Announcement Date none of the
Acquisition Parties had undertaken any trading or incurred any
material liabilities of any nature whatsoever whether actual or
contingent other than liabilities for professional fees and any
liability which would arise if the relevant company were wound up.
9.3 REPETITION
The representations and warranties in clauses 9.1, 9.2 and 11.1 shall be
deemed to be repeated on and as of the first Drawdown Date, and in the
case of clause 9.1 (other than clause 9.1(e)) only, each subsequent
Drawdown Date and each Interest Payment Date and in the case of clause 9.1
by each Acceding Borrower (as defined in schedule 10) on the date of its
execution of the relevant Accession Certificate, as if made with reference
to the facts and circumstances existing on each such date.
9.4 THIRD ACQUISITIONS REPRESENTATIONS AND WARRANTIES
Newco 2 further represents and warrants to each of the Finance Parties on
the same terms as in clauses 9.2 and 9.3 of the Senior Subordinated
Facility Agreement on the same dates on which such representations and
warranties are made in accordance with the Senior Subordinated Facility
Agreement.
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10 UNDERTAKINGS
10.1 INFORMATION UNDERTAKINGS
Newco 2 undertakes with each of the Finance Parties that, throughout the
Finance Period:
(a) Preparation of financial statements:
(i) Annual audited financial statements: it will prepare (A)
unconsolidated financial statements in respect of itself (and
will procure that the Target and Newco 1 prepare
unconsolidated financial statements in respect of themselves),
and (B) consolidated financial statements in respect of the
Group in accordance with the Appropriate Accounting Principles
(consistently applied) in respect of each financial year and
cause the same to be reported on by the Auditors; and
(ii) Unaudited management accounts: it will prepare management
accounts in respect of itself and unaudited consolidated
management accounts in respect of (x) the Group and (y) each
of the principal operating divisions within the Group (while
operated as separate divisions), in each case in accordance
with the Appropriate Accounting Principles (consistently
applied) in respect of each successive month and each Quarter
in such form as may be specified or agreed by the Agent from
time to time and including, without limitation in respect of
each such month or, as the case may be, Quarter:
(A) a consolidated cashflow statement and profit and loss
account for (1) such period and (2) the financial year
to date and (3) in the case of each Quarter, whatever
periods or rolling twelve month periods are relevant to
the calculations of the Financial Definitions for the
Financial Covenants;
(B) a consolidated balance sheet as at the end of such
period; and
(C) a comparison of all relevant results with the relevant
Annual Budget and a brief commentary from the chief
executive officer, finance director or treasurer on any
significant adverse variations and any material Capital
Expenditure;
(b) Delivery of financial statements: it will deliver to the Agent, for
distribution to the Banks, sufficient copies for all the Banks of
each of the following documents:
(i) Annual audited financial statements: at the time of issue
thereof (or promptly thereafter) to the shareholders of Newco
2 (or the
76
shareholders of the Target or the shareholders of Newco 1) but
in any event not later than 120 days after the end of the
financial year to which they relate, the audited financial
statements referred to in clause 10.1(a)(i) for each financial
year together, in each case, with the report of the Auditors
thereon, the notes thereto, the directors' report thereon and
the certificate referred to in clause 10.1(b)(iv);
(ii) Unaudited management accounts: (x) within 30 days after the
end of each month which is not the last month in a Quarter,
and (y) within 45 days after the end of each Quarter
management accounts for the Group in respect of such month
and, as the case may be, such Quarter prepared in accordance
with the requirements of clause 10.1(a)(ii) together with the
certificate referred to in clause 10.1(b)(iii);
(iii) Directors' compliance certificates: at the time of the
delivery of the annual audited financial statements for each
financial year and at the time of delivery of the unaudited
management accounts for each Quarter as at the end of which
the Financial Covenants are to be tested and in each case as
at the end of such financial year or Quarter a certificate of
Newco 2 signed by its finance director, chief executive
officer or treasurer at the time stating:
(A) the respective amounts of the Financial Definitions in
respect of or, as the case may be, as at the end of the
relevant period specified in the Financial Covenants and
the calculations pursuant to clause 10.2(f)(ii);
(B) the application of the respective amounts of the
Financial Definitions to the Financial Covenants and
confirming that, as at the date to which the relevant
financial statements or, as the case may be, management
accounts are made up, Newco 2 was in compliance with the
Financial Covenants and clause 10.2(f)(ii) (or, if not,
in each case indicating the extent of the breach and the
steps intended to be taken to remedy the same) and that,
as at the date of the certificate (being a date not more
than 7 days prior to the delivery of the certificate),
no Default has occurred and is continuing (or, if such
is not the case, specifying the same); and
(C) that, to the best of its knowledge and belief, there has
been no material dispute or default (or warranty breach)
under the Transaction Documents or, if there is, the
nature of the same.
Provided that the Agent may consult with the Auditors in
respect of any certificate delivered under this clause
10.1(b)(iii) and, if reasonable grounds exist for believing
that any such certificate was not correct when delivered with
the result that a breach of the
77
relevant Financial Covenant arises (and after consultation
with Newco 2 which shall include good faith discussions
between Newco 2 and the Agent to resolve the Finance Parties'
concerns) require them to give a written opinion to the Agent
on such certificate (the cost of one such requested opinion in
any financial year to be borne by Newco 2);
(iv) Annual Auditors' report: at the time of delivery of the annual
audited financial statements a report from the Auditors (in
the form of schedule 11 or such other form which is acceptable
to the Agent (acting reasonably) and which can be relied upon
by the Agent (for itself and the other Finance Parties))
stating:
(A) the respective Financial Definitions in respect of or,
as the case may be, as at the end of the relevant period
specified in the Financial Covenants and indicating the
manner in which such amounts have been calculated;
(B) the application of the respective amounts of such
Financial Definitions to the Financial Covenants and
confirming that, as at the date at or to which the
relevant financial statements are made up, Newco 2 was
in compliance with the Financial Covenants (or, if not,
indicating the extent of any non-compliance); and
(C) which members of the Group are Material Entities and
whether Newco 2 is in compliance with clause 10.2(f)(ii)
as at the date of such certificate.
Such reports shall (in the absence of manifest error) be
conclusive as to matters contained in them;
(v) Annual Budget: (x) as soon as practicable after approval by
the Board of Directors of Newco 2 but in any event not later
than 45 days after the beginning of each financial year, the
Annual Budget for such financial year and (y) as soon as
practicable after its approval by the Board of Directors of
Newco 2, any revision to such Annual Budget;
(vi) Reports and notices to shareholders and creditors: at the time
of issue by any Acquisition Party or any member of the Group
thereof, (x) every report, circular, notice or like document
issued to its shareholders which it is required to issue by
applicable law or regulation, (y) every formal notice issued
to its creditors generally or to the holders of the High Yield
Bonds and (z) every notice convening a meeting of the
shareholders or any class of the shareholders of any
Acquisition Party or any member of the Group;
(vii) Equity Permitted Payments: notify the Agent of each Equity
Permitted Payment in excess of L250,000 proposed to be made
78
not later than the fifth Banking Day prior to the date on
which such payment is intended to be made; and
(viii) Further information: promptly upon request, such further
information concerning the financial position of any
Acquisition Party or the Group (or any member of it) as the
Agent shall reasonably require;
(c) Notice of Default: it will promptly upon becoming aware of the same
inform the Agent of (i) any occurrence of which it becomes aware
which could reasonably be expected to have a Material Adverse Effect
and (ii) any Default;
(d) Notice of litigation/labour disputes: it will, upon becoming aware
that the same is threatened and in any case promptly after the
commencement thereof, give to the Agent notice in writing of any
litigation, alternative dispute resolution, arbitration or
administrative proceedings, any labour dispute or any other dispute
affecting any member of the Group or any of their respective assets,
rights or revenues which if adversely determined would be reasonably
likely to have a Material Adverse Effect;
(e) Year 2000 compliance:
[Not restated]; and
(f) Environmental Claims: it will, and will procure that the other
members of the Group will, as promptly as possible upon receipt of
formal written notice of the same, inform the Agent of any
Environmental Claim which has been made or threatened by formal
written notice against any member of the Group or any of the
officers of any member of the Group in their capacity as such or any
requirement by any Environmental Licence or applicable Environmental
Law to make any material investment or expenditure or take or desist
from taking any action in each case where such Environmental Claim
or any such failure to invest or incur expenditure or take or desist
from taking any action, or the making of such investment or
expenditure, would be reasonably likely to have a Material Adverse
Effect.
10.2 GENERAL UNDERTAKINGS
Newco 2 undertakes with each of the Finance Parties that, throughout the
Finance Period:
(a) Use of proceeds: it will, and will procure that each other Borrower
will, use the proceeds of Drawings under the Facilities exclusively
for the respective purposes specified in clause 2;
(b) Consents etc relating to the Finance Documents: it will (and will
procure the same in respect of all other members of the Group),
without prejudice to clauses 3.1 and 3.2, obtain or cause to be
obtained, maintain in full force and effect and comply in all
material respects with the conditions
79
and restrictions (if any) imposed in, or in connection with, every
consent, authorisation, licence or approval of any Government Entity
and do, or cause to be done, all other acts and things which may
from time to time be necessary under applicable law, in each case
for the continued due performance of all its (or the other members
of the Group's) obligations under the Finance Documents except for
consents, approvals, licences or authorisations where the failure to
obtain or comply with the same would not be reasonably likely to
have a Material Adverse Effect;
(c) Compliance with consents etc relating to the business of the Group:
it will comply, and shall procure that all other members of the
Group comply, in all material respects with the terms and conditions
of all laws, regulations, agreements, licences and concessions
material to the carrying on of the business of any member of the
Group as it is being carried on at, or is contemplated by the
Financial Model to be carried on from, the Second Effective Date
except to the extent that any non compliance would not be reasonably
be likely to have a Material Adverse Effect;
(d) Tax returns: it will, and will procure that each other member of the
Group will, file or cause to be filed all material tax returns
required to be filed in all jurisdictions in which it is situated or
carries on business or is otherwise subject to Taxation prior to
penalties being incurred and pay all material Taxes shown to be due
and payable on such returns or any assessments made against it prior
to penalties being incurred (other than those being contested in
good faith and where such payment may be lawfully withheld);
(e) Pension schemes: it will ensure that the levels of contribution to
the pension schemes for the time being operated by the Group are and
continue to be sufficient to comply with all material obligations of
the Group whether under such schemes or generally at law;
(f) Guarantees and security from Subsidiaries: (without prejudice to
clause 10.6(s)) it will procure, unless and to the extent that such
execution and delivery and granting of security would be unavoidably
unlawful or is prohibited by statute or beyond the corporate power
of the company or corporation concerned (and then only if such
corporate power cannot be modified or extended to allow such
execution, delivery and granting of security) or would be reasonably
likely to result in the directors of the company or corporation
concerned incurring actual personal liabilities:
(i) that documentation, in form and substance reasonably
satisfactory to the Agent, supplemental to and/or
incorporating provisions substantially the same as the Group
Debenture and/or such other Security Documents and such
ancillary documentation as the Agent may require (acting
reasonably) shall be executed and delivered to the Agent by
any member of the Group which is a Material Entity and which
is not a Charging Subsidiary (in each case together with legal
opinions relating thereto in form and substance satisfactory
to the Agent (acting reasonably)), to the
80
intent that each member of the Group which is a Material
Entity shall guarantee the obligations of the Borrowers under
the Finance Documents and create Encumbrances securing its
obligations under such guarantee equivalent to the
Encumbrances created by the Group Debenture or otherwise to
the extent practicable with respect to any jurisdiction
outside the United Kingdom; and
(ii) that at all times:
(A) the pro forma Consolidated EBITDA of the Charging Group
(for this purpose measured as if references in the
definition of Consolidated EBITDA to the "Group" were
references to the "Charging Group") is at least 95 per
cent. of the Consolidated EBITDA of the Group;
(B) the pro forma consolidated turnover of the Charging
Group is at least 95 per cent. or more of the
consolidated turnover of the Group; and
(C) the pro forma consolidated total assets of the Charging
Group is at least 95 per cent. or more of the
consolidated total assets of the Group,
in each case tested on a rolling 12 months basis as at the end
of each Quarter by reference to the most recent management
accounts for such Quarter delivered in accordance with clause
10.1(b)(ii) and the most recent audited financial statements
delivered in accordance with clause 10.1(b)(i).
Encumbrances will not be required over those assets as to which the
Agent shall determine in its reasonable discretion that the costs
(including with respect to mortgage transfer and other taxes) of
obtaining or administering such an Encumbrance are excessive in
relation to the value of the security to be afforded thereby or to
the extent that obtaining such security is otherwise impracticable.
Newco 2 will also procure that the immediate Holding Company of any
Material Entity referred to in clause 10.2(f)(i) executes an
Encumbrance over the shares in any Material Entity referred to in
clause 10.2(f)(i) (if such shares are not already the subject of an
Encumbrance created by a Security Document executed by such Holding
Company), which Security Document is governed by the same law as the
law under which such Material Entity is incorporated or formed;
(g) Pari passu: it will ensure that its obligations, and those of each
other member of the Group, under each of the Finance Documents
shall, without prejudice to the provisions of clauses 10.2(b) and
10.6(a), at all times be direct, general and unconditional
obligations and rank at least pari passu with all its other present
and future unsecured and unsubordinated Indebtedness with the
exception of any obligations which are mandatorily preferred by law
and not by contract;
81
(h) Insurance: it will, and will procure that the other members of the
Group will, insure and keep insured all its property and assets of
an insurable nature and which are customarily insured (either
generally or by companies carrying on a similar business) against
loss or damage by fire and other risks normally insured against by
persons carrying on the same class of business in a similar location
as that carried on by it with reputable independent insurance
companies or underwriters;
(i) Inspection of books: it will, and will procure that each other
member of the Group will, permit the Agent to inspect its books and
records during normal business hours upon reasonable notice;
(j) Environmental: it will, and will procure that each other member of
the Group will, comply with all Environmental Laws and Environmental
Licences to the extent that a failure to so comply could be
reasonably expected to have a Material Adverse Effect;
(k) Intellectual Property Rights: it will, and will procure that each
other member of the Group will:
(i) notify the Agent promptly of any infringement or suspected
infringement or any challenge to the validity of any of the
present or future Intellectual Property Rights owned, used or
exploited by to it which may come to its notice and will
supply the Agent with all information in its possession
relating thereto if the same is reasonably likely to have a
Material Adverse Effect and take all necessary steps
(including, without limitation, the institution of legal
proceedings) to prevent third parties infringing any
Intellectual Property Rights to the extent that failure to do
so would be reasonably likely to have a Material Adverse
Effect;
(ii) take all necessary action to safeguard and maintain its
rights, present and future, in or relating to all Intellectual
Property Rights to the extent that failure to do so would be
reasonably likely to have a Material Adverse Effect (in each
case including, without limitation, paying all applicable
renewal fees, licence fees and other outgoings); and
(iii) not enter into any licence or other agreement or arrangement
in respect of Intellectual Property Rights other than on
normal arm's length commercial terms and will comply with all
licences to it of any Intellectual Property Rights, in each
case, to the extent that failure to do so would be reasonably
likely to have a Material Adverse Effect;
(l) Cash management of non-UK companies:
it will procure that to the extent that to do so would not cause a
breach of law or regulation on the part of the relevant Group member
or any applicable contractual restriction binding on the relevant
Group member at the date of this Agreement and except to the extent
that the directors of
82
such Group member consider that such Group member would have
inadequate resources to meet the forecast cashflow requirements of
such Group member for the following 120 days (which shall be
determined by the board of directors of such Group member, acting
reasonably, having regard to their responsibilities under applicable
law) and except to the extent that it would incur a material cost
(after taking into account any tax considerations) which it would
not otherwise ultimately have incurred, each Group member
incorporated outside the United Kingdom shall deposit its surplus
cash balances with a member of the Charging Group in an account of
such member in the United Kingdom, provided that no such deposit
shall be required if the surplus cash balances which would otherwise
have been required to be so deposited are in aggregate less than
L1,000,000 (or its equivalent);
(m) Euro compliance
[Not restated]; and
(n) Tax losses and allowances
it will procure that, to the extent permitted by laws and to the
extent practicable, all losses, allowances, exemptions, set-offs,
deductions, credits or other reliefs relating to any Taxation or to
the computation of income, profits or chargeable gains for the
purpose of any Taxation ("RELIEFS") which are, after the date
hereof, available to the Target (including, without limitation, any
advance corporation tax paid by any such company which has not, at
the date hereof, been set against the liability to corporation tax
of any company and any Reliefs available in respect of interest paid
or payable by such company) are applied (by way of surrender or
otherwise) when reasonably considered appropriate in the interests
of the Group by the Target in reducing or extinguishing any
liability in respect of Newco 2 or any other member of the Group to
Taxes or the amount of its income, profits or chargeable gains which
are subject to Taxation;
10.3 FINANCIAL UNDERTAKINGS
(a) Newco 2 undertakes with each of the Finance Parties that, throughout
the Finance Period, it will observe and comply with the Financial
Covenants.
(b) The Financial Definitions in paragraph 3 of schedule 8 shall be
determined for, and tested as at the end of, each Quarter or, in the
case of the Consolidated Fixed Charge Cover Ratio, each half year by
reference to the management accounts for such Quarter or (as
applicable) half year delivered in accordance with clause
10.1(b)(ii) and the Financial Covenants in paragraph 1 of schedule 8
shall be tested as at the end of each such Quarter or (as
applicable) half year, in each case by reference to such management
accounts, provided that if the audited consolidated financial
statements of the Group for any financial year delivered in
accordance with clause 10.1(b)(i) show different determinations for
such Financial Definitions from those shown in the management
accounts for
83
the last month in such financial year such audited consolidated
financial statements shall prevail in respect of such determinations
and, where there was a difference affecting the opening balance
sheet position for the current financial year, each set of
management accounts delivered during such current financial year
shall be restated by Newco 2 so that each such set of management
accounts is in line with such audited consolidated financial
statements and any Financial Covenant thereby affected shall be
deemed to have been tested by reference to such restated management
accounts.
10.4 CONDITIONS SUBSEQUENT
(a) Assistance with syndication arrangement: Newco 2 undertakes with the
Amendment Arrangers that, upon any Amendment Arranger's request in
connection with the syndication of the Facilities, it will (i)
promptly provide all reasonably requested financial and other
information in the possession of the Acquisition Parties with
respect to each of the Acquisition Parties, the Group, the Target
and their respective Affiliates (save, in the case of such
Affiliates, any entities which are Affiliates (but not Subsidiaries)
of Newco 2 solely by reason of being under common control by ▇▇▇▇▇
Muse), the businesses acquired pursuant to the Second Acquisitions
(the "SECOND ACQUISITIONS TARGET BUSINESSES") and, to the extent
relevant in relation to the Facilities, ▇▇▇▇▇ Muse, including
information and projections prepared by Newco 2 or its advisers,
(ii) make its officers and those of the Second Purchasers available
to Banks or prospective Banks at reasonable times, make the senior
officers of the Second Acquisitions Target Businesses available to
Banks and prospective Banks at reasonable times after the UK Second
Acquisition Completion Date (in the case of the United Kingdom
business) or after the Irish Second Acquisition Completion Date (in
the case of the Irish business), (iii) assist the Amendment
Arrangers in the preparation of any Information Memoranda or similar
documents and other marketing materials to be used in connection
with the sub-underwriting and general syndication of the Facilities,
(iv) together with the Amendment Arrangers, host meetings and hold
discussions with Banks or prospective Banks, (v) facilitate site
visits (if any) required by the Amendment Arrangers and (vi) use
reasonable efforts to ensure that the syndication efforts benefit
materially from the existing lending relationships of Newco 2, the
Second Acquisitions Target Businesses and ▇▇▇▇▇ Muse.
(b) Jonker Fris Security
[Not restated];
(c) Dutch Companies
[Not restated]; and
(d) French guarantees
[Not restated].
84
10.5 HEDGE TRANSACTIONS
(a) Hedge Transactions
Newco 2 undertakes with each of the Banks that:
(i) it shall enter into (and thereafter maintain) hedging
arrangements with the Hedge Counterparties in accordance with
the Hedging Strategy Letter; and
(ii) it will not, and it will procure that no other member of the
Group will, enter into any Derivatives Transactions which are
speculative or do not relate to the hedging of exposures or
liabilities of members of the Group in the ordinary course of
business or in accordance with the Hedging Strategy Letter;
(b) Termination of the Hedge Transactions
Each Hedge Counterparty agrees with the Banks (but not with Newco 2
or any other member of the Group) that it will not terminate any
Hedge Transaction to which it is a party (each such Hedge
Transaction being a "RELEVANT HEDGING TRANSACTION") except:
(i) as a result of the non-payment by the relevant member of the
Group of any Indebtedness under any relevant Hedging
Transaction which has fallen due for payment in the currency
and manner stipulated in the relevant Hedge Document before
the expiry of any applicable cure period (or, if no cure
period is prescribed in the relevant Hedge Document, 3 Banking
Days);
(ii) as a result of the repudiation of any relevant Hedging
Transaction by the relevant member of the Group;
(iii) upon the issue by the Agent of a notice under clause 12.2(c)
or (e);
(iv) upon:
(A) it becoming contrary to any law or regulation for the
relevant member of the Group or such Hedge Counterparty
to perform the payment obligations expressed to be
assumed by it in respect of any relevant Hedging
Transaction or such obligations become invalid or
unenforceable against the relevant member of the Group;
or
(B) any provision of any Hedge Document to which such Hedge
Counterparty is a party relating to the termination
thereof (including, without limitation, the calculation
of or obligation to pay amounts upon such termination)
becoming invalid or unenforceable against the relevant
member of the Group;
85
(v) upon any exchange control, foreign currency or other consent,
authorisation, licence or approval of, or registration with or
declaration to, governmental or public bodies or authorities
or courts required by the relevant member of the Group to
authorise, or required by the relevant member of the Group in
connection with, the execution, delivery, validity,
enforceability or admissibility in evidence of any Hedge
Document or the performance of its payment obligations
thereunder being modified in a manner unacceptable to such
Hedge Counterparty or not being granted or being revoked or
terminated or expiring and not being renewed or otherwise
ceasing to be in full force and effect;
(vi) upon the winding-up of, or the administration of, or the
appointment of a receiver or an administrator in respect of
any part of the assets and/or undertaking of, or the
dissolution of, the relevant member of the Group party to the
relevant Hedging Transaction (or any analogous provision in
any other jurisdiction); or
(vii) with the prior written consent of the Agent (acting on the
instructions of the Majority Banks).
(c) Documentation
Each Hedge Document shall be on the terms of the International Swaps
& Derivatives Association, Inc. 1992 Master Agreement
(Multicurrency-Cross Border) under which:
(i) "Second Method" and "Market Quotation" shall be specified as
the payment method applicable;
(ii) no additional rights of set-off beyond those contained in this
Agreement shall be specified; and
(iii) the governing law is English law.
(d) Termination Payments
Each Hedge Counterparty and Newco 2 agree that any termination
payment payable by a Hedge Counterparty to Newco 2 in respect of any
relevant Hedging Transaction shall be payable in full without any
set-off or counterclaim whatsoever to Newco 2 (irrespective of any
amounts that may at such time be due from Newco 2 to any such Hedge
Counterparty under this Agreement or any other Finance Document).
10.6 NEGATIVE UNDERTAKINGS
Each Borrower undertakes with each of the Finance Parties that throughout
the Finance Period, without the prior written consent of the Agent acting
on the instructions of the Majority Banks (or, in the case of clause
10.6(b)(ii) all the Banks):
86
(a) Negative pledge: it will not, and will procure that no other member
of the Group will, permit any Encumbrance by it or any other member
of the Group to subsist, arise or be created or extended over all or
any part of their respective present or future undertakings, assets,
rights or revenues, save for any Permitted Encumbrance;
(b) Transactions similar to security: (without prejudice to sub-clauses
10.6(c) and (f)) it will not, and will procure that no other member
of the Group will:
(i) sell or otherwise dispose of any of its assets on terms
whereby such asset is or may be leased to, or re-acquired or
acquired by, Newco 2 or any other member of the Group other
than as part of a transaction whereby the asset concerned
becomes the subject of a Finance Lease which is permitted
under clause 10.6(c)(viii); or
(ii) sell, factor or dispose of any of its receivables other than
the sale of receivables in connection with a trade receivables
financing transaction which is on arms length terms in form
and substance satisfactory to all of the Banks (acting
reasonably) provided that all of the proceeds of such sale are
immediately applied in prepaying the Facilities;
(c) No other Borrowed Money: it will not, and will procure that no other
member of the Group will, incur or permit to exist on its behalf any
obligations in respect of Borrowed Money (other than in respect of
any guarantees in respect of Borrowed Money to the extent permitted
by clause 10.6(d) and transactions similar to security permitted by
clause 10.6(b)) to any person except:
(i) the Facilities (including, for the avoidance of doubt,
Borrowed Money to the extent that it is the subject of a
Letter of Credit issued under the Working Capital Facility or
a guarantee issued by an Ancillary Facilities Bank);
(ii) Borrowed Money incurred by Newco 2 under the Intercompany Loan
Agreement and the Target/Newco 2 Loan Agreement;
(iii) Borrowed Money owed by: (x) any member of the Charging Group
to another member of the Charging Group, (y) any member of the
Group to a member of the Charging Group provided the total
aggregate amount of all such Borrowed Money (other than that
representing loans permitted under clause 10.6(i)(vii)) at any
one time does not exceed L10,000,000 (or its equivalent in
relevant currencies), and (z) any member of the Group (which
is not a member of the Charging Group) to another member of
the Group (which is not a member of the Charging Group);
(iv) Borrowed Money incurred under any Hedge Transactions not
otherwise restricted hereby;
87
(v) the Senior Subordinated Facility;
(vi) [Not restated];
(vii) Borrowed Money of any member of the Charging Group owed to
the seller representing the purchase price of a Permitted
Acquisition provided that (x) the aggregate amount of such
Borrowed Money shall not exceed L5,000,000 and (y) the amount
of any such Borrowed Money outstanding or otherwise is not
subsequently increased;
(viii) obligations in respect of Finance Leases to the extent that
the aggregate amount of the principal element of the
obligations under all such Finance Leases at any time,
calculated in accordance with the Appropriate Accounting
Principles at the relevant time, does not (converting into
its equivalent in Sterling any amount in another currency)
exceed L2,500,000 at any such time;
(ix) Borrowed Money in addition to that permitted by clauses
10.6(c)(i) to (viii) not exceeding L15,000,000 (or its
equivalent in relevant currencies) in aggregate at any time;
and
(x) the Subordinated Shareholder Loans;
(d) Guarantees: it will not, and will procure that no other member of
the Group will (other than to the extent provided in the Security
Documents) incur or permit to exist on its behalf any Indebtedness
under any guarantee in respect of Indebtedness of any person except
for:
(i) guarantees in respect of Indebtedness (not being Borrowed
Money) of a member of the Charging Group permitted under this
Agreement;
(ii) indemnities granted by members of the Group in respect of
performance bonds, bid bonds, guarantees, letters of credit
and other obligations of a like nature incurred in the
ordinary course of business;
(iii) indemnities granted in the Finance Documents, the Transaction
Documents, the Senior Subordinated Finance Documents, the
monitoring and oversight agreement and the financial advisory
agreement referred to and entered into in accordance with
clause 10.6(j) or in the constitutional documents of the
members of the Group; and
(iv) indemnities and guarantees made in the ordinary course of
business, or for the purpose of carrying on the same, provided
that such indemnities or guarantees could not individually or
in the aggregate have a Material Adverse Effect;
88
(e) Operating leases: it will not, and will procure that no other member
of the Group will, enter into any obligations in respect of
operating leases relating to assets (other than real property) if as
a result the aggregate liability of all members of the Group with
respect to rentals in any one financial year under such operating
leases (converting into its equivalent in Sterling any amount in
another currency) exceeds by more than L6,000,000 the aggregate
liability of all members of the Group with respect to rentals in the
financial year ending 31 December 1999 under the operating leases of
the members of the Group as at 31 December 1998;
(f) Disposals: it will not, and will procure that no other member of the
Group will, sell, transfer, lease, surrender, lend or otherwise
dispose of (each a "DISPOSAL") or cease to exercise direct control
over the whole or any part of its present or future assets or
revenues whether by one or a series of transactions related or not
except for:
(i) the disposal of stock-in-trade in the ordinary course of
business;
(ii) the disposal of any tangible asset which is obsolete or worn
out;
(iii) any disposal of any asset (other than receivables) on arm's
length terms for full consideration (of which at least 75 per
cent. is cash) where the market or book value is less than
L15,000,000 (or its equivalent) in respect of the aggregate of
all such disposals in any financial year of Newco 2 (or, in
the case of Newco 2's 2002 financial year, since the UK Second
Acquisition Completion Date) provided that the Net Proceeds of
such disposal are applied in accordance with clause 6.10;
(iv) loans and credit permitted pursuant to clause 10.6(i);
(v) the application of cash not otherwise prohibited under the
Finance Documents;
(vi) the disposal of any asset by:
(A) a member of the Group to a member of the Charging Group
but so that where any such asset is subject or is
expressed to be subject to an Encumbrance pursuant to
any Security Document such disposal shall only be
permitted where the Security Agent is satisfied either
that (x) such Encumbrance is not prejudiced as a result
of such disposal and the acquisition of such asset by
the other Charging Group member or (y) the asset
concerned becomes subject to a fully enforceable,
legally binding Encumbrance in favour of the Security
Agent and the other Finance Parties substantially
equivalent to or better than such other Encumbrance; or
89
(B) any member of the Group which is not a member of the
Charging Group to another member of the Group which is
also not a member of the Charging Group; or
(C) a member of the Charging Group to a member of the Group
which is not a member of the Charging Group provided
that the aggregate market or book value of all such
disposals does not exceed L5,000,000 (or its equivalent
in the relevant currency) and all such disposals are in
accordance with clause 10.6(j);
(vii) licences, leases or subleases of Intellectual Property Rights
(other than the Intellectual Property Rights subject to, or
arising under or in connection with, any or all of the UKIPR
Agreement, the Irish IPR Agreement, the Rowntrees Licence and
the Chef Licence) and leases or subleases of real property in
each case in the ordinary course of business and which do not
materially interfere with the business of the Group;
(viii) the sale and discount of overdue accounts receivable during
the ordinary course of business, but only in connection with
the compromise or collection thereof;
(ix) disposals pursuant to and in accordance with the Demerger
Agreements;
(x) disposals permitted under clauses 10.6(b) and (n);
(xi) disposals of a fixed asset in exchange for a replacement
fixed asset of the same or similar type and of a comparable
or superior value and quality or a fixed asset the commercial
purpose and effect of which is to replace or improve upon the
commercial purpose of the fixed asset disposed of; and
(xii) mandatory disposals (as defined in clause 6.10(c)(ii)) on
arm's length terms for full consideration (of which at least
75 per cent. is cash) provided that the Net Proceeds thereof
are applied in accordance with clause 6.10,
and so that where the asset or assets the subject of a disposal
permitted by this clause 10.6(f) (other than clause 10.6(f)(vi)(A)
is or are subject to a fixed charge created by the Security
Documents or any of them, the consents of the Finance Parties to the
release of such fixed charge (but without prejudice or
responsibility to or in respect of any other requisite consent)
shall not be refused provided that no Default shall have occurred
and be continuing (and the Agent is irrevocably authorised by the
other Finance Parties to instruct the Security Agent to grant such
consent without reference to them);
90
(g) Equity yield and intercompany loan payments: Newco 2 will not:
(i) declare or pay (including, without limitation, by way of
set-off, combination of accounts or otherwise) any dividend or
make any other distribution or payment (whether in cash or in
specie), including any interest and/or unpaid dividends, in
respect of its equity or any other share capital for the time
being in issue (other than an Equity Permitted Payment made in
accordance with the Subordination Deeds); or
(ii) make any payment (including, without limitation, by way of
set-off, combination of accounts or otherwise) of interest, or
make any other payment, in respect of any amounts outstanding
under the Intercompany Loan Agreement (other than an
Intercompany Loan Permitted Payment made in accordance with
the Intercompany Loan Subordination Deed), the Target/Newco 2
Loan Agreement (other than an Equity Permitted Payment made in
accordance with the Target/Newco 2 Subordination Deed) or the
Subordinated Shareholder Loans;
(h) Reduction of capital: it will not redeem or purchase or otherwise
reduce its equity or any other share capital or any uncalled or
unpaid liability in respect thereof or reduce the amount (if any)
for the time being standing to the credit of its share premium
account or capital redemption or other undistributable reserve in
any manner, in each case, in whole or in part in any circumstances
save where the redemption, purchase or reduction is an Equity
Permitted Payment;
(i) Loans and credit: it will not, and will procure that no other member
of the Group will, make any loans or grant any credit other than:
(i) loans or credit permitted by clause 10.6(c)(iii);
(ii) loans or credit in existence on the Effective Date and
extensions, renewals, modifications or restatements or
replacements thereof, provided that no such extension,
renewal, modification or restatement shall (x) increase the
amount of the original loan or credit or (y) materially
adversely affect the interests of the Finance Parties with
respect to such original loan, or credit or the interests of
the Finance Parties under this Agreement or any other Finance
Document in any material respect;
(iii) promissory notes and other similar non-cash consideration
received by any member of the Group in connection with
disposals permitted under clause 10.6(f);
(iv) loans or credit to directors, officers and employees of the
Group up to a maximum amount at any time of L3,000,000 (or its
equivalent) in aggregate;
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(v) the granting of credit to trade debtors in the ordinary
course of the relevant member of the Group's business as
carried on by it at the date of this Agreement or (if later)
the date it becomes a member of the Group;
(vi) in respect of cash deposits placed by any member of the Group
in accounts (other than those maintained in accordance with
clause 10.6(w)) with Approved Banks;
(vii) subject to an aggregate limit of L10,000,000 at any relevant
time on loans and credit to, and acquisitions of or by,
companies which are not members of the Charging Group, loans
or credit to members of the Group or companies, the
acquisition of which would be a Permitted Acquisition, where
such loans or credit are funded by:
(A) Consolidated Excess Cash Flow in respect of the previous
financial year not required to be applied in prepayment
of the Facilities pursuant to clause 6.11 and made after
the prepayment required under such clause has been duly
made;
(B) the amount of Net Proceeds of disposals not required to
be applied in prepayment of the Facilities pursuant to
clause 6.10 and made after the prepayment required under
such clause has been duly made; or
(C) the proportion of aggregate net proceeds of any
Flotation not required to be applied in prepayment of
the Facilities pursuant to clause 6.6(a) and made after
the prepayment required under such clause has been duly
made;
(viii) investments in Cash Equivalents; and
(ix) in addition to the foregoing, loans or credits in the
ordinary course of business on arms' length terms by members
of the Group in an aggregate amount (at cost, without regard
to any write down or write up thereof) at any one time
outstanding not exceeding L1,000,000 (or its equivalent);
(j) Intra-Group contracts and arrangements: it will not, and will
procure that no other member of the Group will, enter into any
arrangement or contract with any of its Subsidiaries or Affiliates
which is not a Charging Subsidiary or any member of the HMTF Group
unless such arrangement or contract is entered into on an arm's
length basis and is fair and equitable to it or, as the case may be,
such other member of the Group and would be entered into by a
prudent person in the position of Newco 2 or the relevant member of
the Group. For the avoidance of doubt:
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(i) payment may be made of reasonable and customary fees for work
done by directors of any member of the Group, the Target or
Newco 1 and their expenses may be reimbursed;
(ii) payment may be made to ▇▇▇▇▇ Muse and its Affiliates of fees
and expenses not exceeding the amounts set out in schedule 14
pursuant to a monitoring and oversight agreement and a
financial advisory agreement, in each case approved by the
board of directors of Newco 2; and
(iii) employment arrangements in respect of the procurement of the
services of directors, officers and employees in the ordinary
course of business may be entered into and reasonable fees in
connection therewith paid; and
(iv) the services to be provided by the Target pursuant to the
Demerger Agreements may only be provided on a non-profit
making basis;
(k) Amendment to documents: it will not, and will procure that no other
member of the Group nor any Acquisition Party will, terminate, amend
or vary, or acquiesce in any termination, amendment or variation of,
any of the Transaction Documents (other than the Third Acquisition
Agreements) (other than amendments of typographical errors or
inconsistencies or which do not affect the timing or quantum of
payments due in respect thereof or thereunder and provided that no
such amendments are in the Agent's opinion (acting reasonably)
material to the Finance Parties) and will comply with their material
terms and will in the event that any other party thereto breaches
the same in any material respect forthwith inform the Agent of the
nature and substance thereof. Newco 2 undertakes that it will also
procure that the loan notes constituted by the Loan Note Instrument
remain outstanding throughout the Finance Period;
(l) Shareholders' meetings, the New Articles and the New Target
Articles: (in the case of Newco 2 only) it will not convene any
meeting with a view to the alteration of any provision of the New
Articles which would adversely affect any of the rights attaching to
the "GOLDEN SHARE" referred to in the New Articles or would affect
the timing or quantum of payments due in respect thereof or
thereunder or which would be reasonably likely to have a Material
Adverse Effect;
(m) New share issues: it will not, and will procure that no other member
of the Group will, issue any shares or otherwise acquire any
additional capital in itself otherwise than (w) the issue of shares
by Newco 2 in order to effect the Pushdown in accordance with this
Agreement, (x) the issue by Newco 2 of shares which do not carry any
right to a return or to redemption before all amounts (whether
actual or contingent) owing under the Finance Documents have been
paid in full and the Finance Parties have no further obligations
thereunder (or to be converted into shares carrying such rights),
(y) an issue of shares in connection with a
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Flotation provided that the resulting prepayment required by clause
6.6 is duly made and (z) the issue of shares by a Charging
Subsidiary to its Holding Company (also being a member of the
Charging Group);
(n) Amalgamation and merger: it will not, and will procure that no other
member of the Group will, amalgamate or merge with any other company
or person unless (i) such merger is with another member of the Group
and (x) a member of the Charging Group shall be the surviving entity
and the Agent is reasonably satisfied (having taken appropriate
advice from counsel in the relevant jurisdiction) that such merger
will not have a negative impact upon any of the obligations owed by
any Obligor to the Finance Parties or upon any material rights the
Finance Parties may have against any of the Obligors, or (y) such
merger is between members of the Group which are not members of the
Charging Group, or (ii) any member of the Group liquidates or
dissolves in either case on a solvent basis and in connection
therewith all of its assets are transferred to any member of the
Charging Group or, if such member is not a member of the Charging
Group, to another member of the Group;
(o) Accounting reference date: it will not change its accounting
reference date (or permit any other member of the Group to do so)
from 31 December;
(p) Accounting Policy: it will not adopt any accounting policy or change
the consistency of application of its accounting principles from the
Appropriate Accounting Principles unless (i) the revised policy and
practice adopted from time to time is in accordance with generally
accepted accounting practice in the United Kingdom and (ii) prior to
any revised policy and practice being adopted Newco 2 notifies the
Agent thereof and, if required by the Agent, negotiates in good
faith with the Agent acting reasonably in order that the Financial
Covenants may be amended as required by the Agent acting reasonably
in order for it to be able to make the same judgments as to the
financial performance of the Group against the Financial Covenants
as it is able to under the present accounting policy provided that
if such negotiations are not concluded to the satisfaction of the
Agent acting reasonably within a period of 30 days from the
commencement of such negotiations Newco 2 agrees that it will either
provide financial statements on the same basis as before or provide
financial statements containing a statement reconciling the previous
and the then current accounting policy in order that the Agent may
determine the financial condition of the Group against the Financial
Covenants having regard to the terms of this Agreement;
(q) Auditors: it will not change its Auditors save to another Big 4 firm
of chartered accountants which is willing to provide the reports
referred to in clause 10.1(b)(iv) on the same or substantially the
same basis and format as the existing Auditors;
(r) Change in business: it will not, and will procure that no other
member of the Group will, make any material change to the general
nature of its business or cease (or threaten to cease) any material
part of its business,
94
which in either case would constitute a material change in the
nature of the business of the Group taken as a whole from that
carried on immediately following the Announcement Date other than
pursuant to the Demerger;
(s) Acquisitions and joint-ventures: save as provided in clause 10.6(t),
it will not, and will procure that no other member of the Group
will, acquire or make any investment in any companies, joint
ventures or partnerships, acquire any tangible or intangible assets
(or interests therein) other than in the ordinary course of
business, or acquire any businesses (or interests therein) other
than the Second Acquisitions, the Third Purchasers or the
acquisition of businesses (including companies) which are related or
complementary to the existing businesses of the Group provided that:
(A) the consideration (including, without limitation, any deferred
consideration (whenever payable), the assumption of
obligations in respect of Borrowed Money by the Group and
taking the value of any non-cash consideration payable by the
Group at the higher of its stated value under the agreement(s)
for the acquisition in question and the market value of such
consideration) payable by the Group ("ACQUISITION
CONSIDERATION") in respect of all such acquisitions in any
financial year (or, in the case of the 2002 financial year,
since the UK Second Acquisition Completion Date) shall not
exceed (pound)45,000,000 (or its equivalent in relevant
currencies) (excluding any amount funded with the Shareholder
Injections referred to in (B) below or by the proceeds of the
Senior Subordinated Facility Advances);
(B) such acquisitions are funded:
1) by Consolidated Excess Cash Flow in respect of the
previous financial year not required to be applied in
prepayment of the Facilities pursuant to clause 6.11; or
2) by the Net Proceeds of disposals not required to be
applied in prepayment of the Facilities pursuant to
clause 6.10; or
3) by Shareholder Injections in Newco 2 funded by ▇▇▇▇▇
Muse or funds or limited partnerships managed by it or
(without prejudice to clause 6.6(a)(i)) other indirect
co-investors in Newco 2;
4) out of Drawings under the Working Capital Facility from
and after the UK Second Acquisition Completion Date not
exceeding (pound)45,000,000 in aggregate but only if the
Agent shall have received, at least 5 Banking Days prior
to entering into such acquisition, or, in the case of an
acquisition funded in whole or in part by Senior
Subordinated Facility Advances, not more than 5 Banking
Days after entering into any commitment to make such
acquisition and at least 5 Banking Days before the
95
completion of such acquisition, working capital
projections (based on historical working capital
requirements) which take account of the intended
acquisition and Drawing under the Working Capital
Facility and which demonstrate to the satisfaction of
the Agent that Newco 2 will have Available Commitments
in respect of the Working Capital Facility of at
least (pound)15,000,000 at all times during the
following 12 months together with a certificate from the
chief executive and one other director of Newco 2
confirming that the acquisition will not adversely
affect any Material Entity's ability to comply with
their respective obligations under the Finance
Documents; or
5) by the proceeds of the Senior Subordinated Facility
Advances;
(C) at least 5 Banking Days prior to entering into any such
acquisition, or, in the case of an acquisition funded in whole
or in part by Senior Subordinated Facility Advances, not more
than 5 Banking Days after entering into any commitment in
respect of such acquisition and at least 5 Banking Days before
the completion of such acquisition, the Agent shall have
received a revised version of the Financial Model, reflecting
the proposed acquisition therein which shows that none of the
Financial Covenants will be breached during the Finance Period
and that no Event of Default will arise under clause 12.1(a),
accompanied by a certificate signed by the chief executive and
one other director of Newco 2 confirming that they believe
that the assumptions upon which the forecasts and projections
in such revised Financial Model are based taken as a whole,
and those forecasts and projections, are fair and reasonable
and confirming that, in making those assumptions and forming
those forecasts and projections Newco 2 has taken full and
proper account of all contingent liabilities (including,
without limitation, contingent environmental liabilities)
relating to the assets to be acquired pursuant to the proposed
acquisition provided that if the acquisition consideration in
respect of an acquisition is (pound)10,000,000 (or its
equivalent in any relevant currency) or less, then a revised
version of the Financial Model need not be so provided if the
chief executive and one other director of Newco 2 can, and do
so, certify that in making such acquisition the Group will not
incur any contingent liabilities which would be likely to have
a material adverse impact on the forecasts and projections
contained in the then applicable Financial Model;
96
(D) no Default will arise as a result of such acquisition; and
(E) the aggregate acquisition consideration of all such
acquisitions of, or by, companies which are not members of the
Charging Group does not exceed (pound)10,000,000 (or its
equivalent) when aggregated with all loans or credit made or
extended to companies which are not members of the Charging
Group pursuant to clause 10.6(i)(vii) at any relevant time,
such acquisitions being "PERMITTED ACQUISITIONS";
(t) Newco 2's business: Newco 2 will not carry on any business or own
any material assets other than its shareholdings in its
Subsidiaries, intra-group credit balances and credit balances in
bank accounts;
(u) Intra-Group accounts: (without limiting the generality of clause
10.6(f)) it will not subordinate, postpone, defer, assign or
otherwise dispose of or deal with any Indebtedness owing to it by
any other member of the Group and will procure that no other member
of the Charging Group will subordinate, postpone, defer, assign or
otherwise dispose of or deal with any Indebtedness owing to it by
any other member of the Group (other than in favour of another
member of the Charging Group);
(v) Dormant companies: it will procure that:
(i) none of the members of the Group which are dormant (within the
meaning of section 250 of the Act) at the date of this
Agreement or hereafter become dormant shall:
(x) carry on any trading activity if it has any material
contingent liabilities; or
(y) demand or accept payment of any Indebtedness owing to it
by a Borrower or a Charging Subsidiary; and
(ii) no Borrower or Charging Subsidiary shall repay any
Indebtedness owing to any dormant company as referred to in
(i) above; and
(w) Cash balances: it will procure that the aggregate amount of cash
balances or deposits of cash held by all members of the Group which
are not placed with Approved Banks at no time exceeds
(pound)1,000,000 (or its equivalent).
10.7 CONDUCT OF THE SECOND ACQUISITIONS AND THE THIRD ACQUISITIONS
Newco 2 undertakes with each of the Finance Parties that throughout the
Finance Period:
(a) it will not (and will procure that no member of the Group will)
terminate, amend or vary, or acquiesce in any termination, amendment
or variation of, any of the Second Acquisitions Agreements or the
Third Acquisition Agreements which might reasonably be expected
materially and
97
adversely to affect the interests of the Finance Parties under the
Finance Documents;
(b) it will not (and will procure that no member of the Group will)
waive or fail to invoke any conditions to the completion of either
of the Second Acquisitions or any of the Third Acquisitions or
exercise (or fail to exercise) any of their rights under clauses
4.3, 4.7 or 5.2 of the Second SPA, and will not (and will procure
that no member of the Group will) accept, to the extent they are
entitled to refuse, any disclosures by the Second Vendors or the
Third Vendors (as applicable) in relation to the warranties
contained in the Second Acquisitions Agreements or the Third
Acquisition Agreements respectively where any such waiver, exercise
(or failure to exercise), failure to invoke or acceptance might
reasonably be expected materially and adversely to affect the
interests of the Finance Parties under the Finance Documents;
(c) it will keep the Agent updated as to the progress of the Second
Acquisitions and the Third Acquisitions;
(d) unless considered by its directors (acting reasonably and having
first consulted with the Agent in respect of any material matter)
not to be commercially prudent, or otherwise not to be in the
interests of any member of the Group (including, without limitation,
taking account of the quantum of the claim), it will (and will
procure that the members of the Group will) pursue (if necessary by
legal action) against the Second Vendors or the Third Vendors (as
applicable) or, as the case may be, any issuer of a Second Report or
a Third Report (as applicable) any material claim to which it may be
entitled as a result of:
(i) a breach of any Second Acquisitions Agreement or any Third
Acquisition Agreement by the Second Vendors or the Third
Vendors respectively;
(ii) any inaccuracy in any of the warranties and representations
included in any Second Acquisitions Agreement or any Third
Acquisition Agreement;
(iii) any indemnity contained in any Second Acquisitions Agreement
or any Third Acquisition Agreement;
(iv) a right to make a claim under any of the Second Reports or any
of the Third Reports; or
(v) any other claims for damages or other remedies in respect of
any breach of any Second Acquisitions Agreement or any Third
Acquisition Agreement or inaccuracy therein and any other
claim in respect of the warranties, indemnities and
representations given to Newco 2, either Second Purchaser or
any Third Purchaser or any member of the Group party to any
relevant document contained in or pursuant to such documents;
and
98
(e) it will not (and will procure that the members of the Group will
not) finally agree or settle the amount of any indemnity or warranty
payment or other claim or potential claim under, or in connection
with, the Second Acquisitions Agreements or the Third Acquisition
Agreements against any of the Second Vendors or Third Vendors (as
applicable) or, as the case may be, any issuer of a Second Report or
a Third Report (to the extent it has discretion to do so), without
the consent of the Agent if the relevant claim relates to actual or
potential recoveries reasonably expected to exceed (pound)10,000,000
(or its equivalent) in aggregate.
10.8 CONDITIONS TO THE IRISH SECOND ACQUISITION COMPLETION DATE
Newco 2 undertakes with each of the Finance Parties that the Irish Second
Acquisition will not complete unless the Agent has notified Newco 2 and
the Banks that it has received the documents and evidence specified in
schedule 3, in each case satisfactory to the Agent (acting reasonably),
or, as the case may be, that the requirement to provide any such document
or evidence has been waived by the Majority Banks.
11 THE SCHEME AND RELATED MATTERS
11.1 THE SCHEME
Newco 2 represents and warrants to each of the Finance Parties as follows:
(a) General
Each of the Acquisition Parties:
(i) has complied in all material respects with the Code, the
Financial Services ▇▇▇ ▇▇▇▇, the Act and all other applicable
laws and regulations relevant in the context of the Scheme;
(ii) subject to any relevant requirement of the Code, has provided
the Agent with information regarding all material matters
likely to affect the interests of the Banks in respect of the
Scheme (which included, without limitation, any market
purchases of shares in the Target made or agreed by the
Acquisition Parties); and
(iii) has ensured that all their obligations under the Scheme were
complied with and performed in all material respects.
(b) Conduct of the Scheme
Each of the Acquisition Parties did not:
(i) amend any of the conditions or terms of the Scheme following
posting of the Scheme Document or agree to an extension or
increase in the Scheme;
(ii) save as required by the Panel on Takeovers and Mergers or to
enable the directors of each of the Acquisition Parties to
comply
99
with Rule 13 of the Code (A) waive or fail to invoke (in whole
or in part) any condition to the Scheme or (B) determine or
declare or accept that any such condition is satisfied where
it is not actually satisfied or (C) permit the Court Order in
respect of the Scheme to be delivered if any condition is not
fulfilled;
(iii) permit any circumstances to arise whereby a mandatory offer
was required to be made by an Acquisition Party by the terms
of Rule 9 of the Code in respect of the shares in the Target;
or
(iv) acquire any shares in the Target at a price above the Scheme
price.
(c) Action after the Scheme has become effective
The Target has been (i) removed from the Official List of
London Stock Exchange Limited and (ii) re-registered as a
private company.
12 EVENTS OF DEFAULT
12.1 EVENTS OF DEFAULT
Each of the events set out below is an Event of Default (whether or not
caused by any reason whatsoever outside the control of any Material Entity
(or any other person)) namely if:
(a) Non-payment: any Material Entity or any other member of the Group
fails to pay any sum due from it under any of the Finance Documents
in the currency, at the time (or within five days thereafter in the
case of amounts other than principal) and in the manner stipulated
in the relevant Finance Document; or
(b) Breach of certain obligations: any Material Entity or any other
member of the Group commits any breach of or omits to observe any of
the obligations or undertakings expressed to be assumed by it under
clauses 10.3, 10.4(b), (c) or (d), 10.6(a), (b), (f), (g), (h) or
(w), or 10.7(a) or (b); or
(c) Breach of other obligations: any Material Entity or any other member
of the Group commits any breach of or omits to observe any of the
obligations or undertakings expressed to be assumed by it under any
of the Finance Documents (other than any such obligations referred
to in clause 12.1(a) and (b)) and, in respect of any such breach or
omission which is capable of remedy, such breach or omission has not
been remedied within 30 days; or
(d) Misrepresentation: any representation, warranty or statement made or
deemed to be made or repeated by or on behalf of any Material Entity
or any other member of the Group in, or in connection with, any of
the Finance Documents or in any notice, accounts, certificate or
statement referred to in or delivered under any of the Finance
Documents is or
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proves to have been incorrect or misleading in any material respect
on the date made or deemed to be made; or
(e) Cross-default: (i) any Borrowed Money of any Material Entity or any
other member of the Group at any time becomes prematurely due and
payable by reason of a default or any creditor of any Material
Entity or any other member of the Group becomes entitled to declare
any such Borrowed Money due and payable prior to the date when it
would otherwise have become due by reason of a default or any
guarantee given by any Material Entity or any other member of the
Group in respect of Borrowed Money is not honoured when due and
called upon (taking into account any applicable grace period); or
(ii) any Borrowed Money of any Material Entity or any other member
of the Group is not paid as and when the same is or becomes due and
payable (or within any applicable grace period) and the aggregate
amount at any time of all Borrowed Money in respect of which (i)
and/or (ii) applies (without double counting) is equal to or greater
than (pound)5,000,000 (converting into Sterling at its equivalent
amounts in any other currency); or (iii) any amount in respect of
the Bridge Facility or the High Yield Bonds is not paid when due and
payable (or within any originally applicable grace period) or
becomes (whether by declaration or automatically in accordance with
the relevant agreement or instrument constituting the same) due and
payable as a result of a default or any creditor or the trustee on
their behalf becomes entitled to declare any amount in respect of
the High Yield Bonds due and payable prior to the date when it would
otherwise have become due by reason of a default; or (iv) an Event
of Default (as defined in the Senior Subordinated Facility
Agreement) occurs; or
(f) Derivatives Transaction default: any Material Entity or any other
member of the Group fails to make payment in relation to a
Derivatives Transaction of any sum equal to or greater than
(pound)5,000,000 in aggregate at any one time (or its equivalent in
the relevant currency of payment) on its due date (taking into
account any grace period permitted under the documentation for that
Derivatives Transaction) or the counterparty to a Derivatives
Transaction becomes entitled to terminate that Derivatives
Transaction early by reason of default on the part of any Material
Entity or any other member of the Group and the Net Derivatives
Liability in the aggregate payable under all affected Derivatives
Transactions at the relevant time is not less than (pound)5,000,000
(or its equivalent in the relevant currency); or
(g) Proceedings concerning the Group: one or more judgements or orders
is made against any Material Entity involving in the aggregate a
liability (not paid or fully covered by insurance) of
(pound)5,000,000 or more and all such judgments or orders shall not
have been vacated, discharged or stayed pending appeal within 30
days from the entry thereof; any execution, distress, sequestration
or other similar process is levied or enforced against all or any
substantial part of the assets of any Material Entity which shall
not have been vacated, discharged or stayed pending appeal within 30
days from the entry thereof; or any Material Entity
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proposes or makes any general composition or arrangement with its
creditors other than on a solvent basis which has been approved by
the Majority Banks; or
(h) Insolvency: any Material Entity generally shall not, or shall be
unable to, or shall admit in writing its inability to, pay its debts
(other than intercompany debts) as they become due; or
(i) Administration: (i) any meeting of any Material Entity is convened
for the purpose of considering any resolution to present an
application for an administration order or to serve a notice of
intention to appoint an administrator or to appoint an administrator
or (ii) any person presents an application for an administration
order, or files documents with a court for the appointment of an
administrator, in relation to any Material Entity or an
administration order is sought of the court on the basis of an
undertaking to subsequently present an application or (iii) any
Material Entity passes a resolution to present an application for an
administration order or to serve a notice of intention to appoint an
administrator or to appoint an administrator in relation to any
Material Entity or (iv) an administration order is made or an
administrator is appointed in relation to any Material Entity; or
(j) Appointment of receivers and managers: (i) any administrative or
other receiver or any manager is appointed of any Material Entity or
all or any substantial part of any of its assets and/or undertakings
or (ii) the directors of any Material Entity request any person to
appoint such a receiver or manager or (iii) any other legal or
formal steps are taken to enforce any Encumbrance over all or any
substantial part of the assets and/or undertakings of any Material
Entity; or
(k) Winding up: (i) any meeting of any Material Entity is convened for
the purpose of considering any resolution for (or to petition for)
its winding up or (ii) any Material Entity passes such a resolution;
or (iii) any person presents any petition for the winding up of any
Material Entity , which is not withdrawn, dismissed or discharged
within 60 days or (iv) an order for the winding up of any Material
Entity is made, not (in any case) being a winding-up of a Subsidiary
of Newco 2 involving an amalgamation or reorganisation on a solvent
basis to which the Majority Banks have given their prior written
consent; or
(l) Analogous proceedings: there occurs, in relation to any Material
Entity, in any country or territory in which any of them carries on
business or to the jurisdiction of whose courts any part of their
assets is subject, any event which, in the reasonable opinion of the
Majority Banks, appears in that country or territory to correspond
with, or have an effect equivalent to, any of those mentioned in
clauses 12.1(h) to (k) (inclusive); or
(m) Seizure: all, or a material part, of the undertaking, assets, rights
or revenues of, or shares or other ownership interests in, any
Material Entity are seized, nationalised, expropriated or
compulsorily acquired by or under the authority of any Government
Entity and such Material Entity
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has not been adequately and promptly compensated and recompensed in
respect of such action; or
(n) Changes of ownership: Newco 2 at any time disposes of any Target
Preference Share acquired by it other than as in accordance with the
Structure Paper;
(o) Finance Documents: any Finance Document is not or ceases to be
legal, valid and binding on, and, subject to the qualifications and
reservations set out in the Legal Opinions (other than those
relating to factual matters), enforceable substantially in
accordance with its terms against, any Material Entity which is
party to that Finance Document and/or (in the case of Security
Documents) does not provide to the Security Agent, for itself and on
behalf of the other Finance Parties, perfected, enforceable security
over the assets purported to be covered by that Security Document in
a manner and to an extent reasonably considered by the Majority
Banks to be materially adverse to their interests under the Finance
Documents, or is alleged by any Material Entity or any member of the
HMTF Group party to that Finance Document to be ineffective for any
reason and any such failure or cessation as to legality, validity
and binding effect is (if capable of remedy) not remedied within 30
days of notice from the Agent; or
(p) Unlawfulness: it becomes unlawful at any time for any Material
Entity to perform all or any of its obligations under any of the
Finance Documents and such unlawfulness is (if capable of remedy)
not remedied within 30 days of notice from the Agent; or
(q) Repudiation: any Material Entity repudiates any Finance Document to
which it is a party or does or causes or permits to be done any act
or thing evidencing an intention to repudiate such a Finance
Document; or
(r) Qualification of financial statements: the Auditors qualify their
report(s) on the audited consolidated financial statements of the
Group or the audited financial statements of any Material Entity (i)
on the grounds of inability to prepare financial statements on a
going concern basis or that, while they had been prepared on that
basis, it was not clear that the Group or the company concerned (as
the case may be) would carry on business as a going concern or (ii)
on the grounds of inadequate information or access to information
being provided to the Auditors or (iii) on any other grounds where
the matter giving rise to the qualification would be reasonably
likely to have a Material Adverse Effect; or
(s) Environmental matters: an Environmental Claim is made against any
Material Entity and as a result a Material Adverse Effect is
reasonably likely to occur; or
(t) ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇, ▇▇ Topco, HMTF Poultry and Citadel
Insurance Company Limited:
103
(i) (other than pursuant to Shareholder Injections) the Target
carries on any business other than that of providing services
pursuant to the Demerger Agreements on a non-profit making
basis and acting as a Holding Company of the Group, owns any
material assets other than all the shares in Newco 1, Citadel
Insurance Company Limited and HMTF Poultry or incurs any
liabilities other than under the Finance Documents, the
Senior Subordinated Finance Documents and the Transaction
Documents to which it is a party or those referred to in the
definition of "Equity Permitted Payment" in clause 1.1 or
those otherwise permitted by the Finance Documents; or
(ii) the Target disposes of any shares (or any interest therein)
in any of its direct Subsidiaries referred to in (i) above;
or
(iii) (other than pursuant to Shareholder Injections) Newco 1
carries on any business other than acting as a Holding
Company of the Group, owns any material assets other than all
of the issued shares in Newco 2 or incurs any liabilities
(whether or not in connection with Borrowed Money) other than
as a result of issuing the High Yield Bonds, effecting the
Pushdown or as a result of its existence and administrative
operation in accordance with this Agreement; or
(iv) at any time after the Pushdown, Newco 1 ceases to be a
wholly-owned direct Subsidiary of the Target; or
(v) Newco 2 ceases to be a wholly-owned direct Subsidiary of
Newco 1; or
(vi) (other than pursuant to Shareholder Injections) UK Topco
carries on any business other than acting as a Holding
Company of the Group, owns any material assets other than all
of the issued shares in the Target or incurs any liabilities
(whether or not in connection with Borrowed Money) other than
as a result of entering into the Second Transaction Documents
to which it is a party or as a result of its existence and
administrative operation in accordance with this Agreement;
or
(vii) the Target ceases to be a wholly-owned direct Subsidiary of
UK Topco; or
(viii) HMTF Poultry carries on any business, owns any assets or
incurs any liabilities in each case to an extent or in a
manner which results (or is reasonably likely to result) in a
material increase in the Taxes payable (directly or
indirectly) by the Group (including, without limitation, the
Taxes payable by the Target which are attributable to the
business of the Group).
(ix) Citadel Insurance Company Limited carries on any business
other than writing insurance in favour of members of the
Group, owns
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any material assets other than as a result of writing such
insurance or incurs any liabilities other than as a result of
writing such insurance or as a result of its existence and
administrative operation in accordance with this Agreement; or
(u) Investment company: at any time after 31 October 1999, Newco 1 or
Newco 2 is or could be deemed an "investment company" under Section
3(a)(1) of the Investment Company ▇▇▇ ▇▇▇▇ of the United States of
America, as amended (notwithstanding the effect of any safe harbor
(including without limitation the safe harbor under Rule 3a-2 under
such act), exception, exemption, order or no-action letter relied
upon or granted in connection therewith). For the avoidance of
doubt, as at the date of this Agreement both Newco 1 and Newco 2 are
or could be deemed an "investment company" under Section 3(a)(1) of
the Investment Company ▇▇▇ ▇▇▇▇ of the United States of America, as
amended; or
(v) No subordination: any amount outstanding under any Subordinated
Shareholder Loan, or any other amount which is expressly agreed by
the relevant member of the Group and the relevant subordinated
creditor to be subordinated to the amounts outstanding under the
Finance Documents, is not, ceases to be or is claimed by the
relevant subordinated creditor not to be subordinated to the amounts
outstanding under the Finance Documents.
12.2 ACCELERATION
The Agent if so requested by the Majority Banks shall, without prejudice
to any other rights of the Finance Parties, at any time after the
happening of an Event of Default, and so long as the same is continuing,
by notice to Newco 2 declare that:
(a) the obligation of each Bank to make its Commitments available shall
be terminated, whereupon the Total Commitments in respect of all
Facilities shall be reduced to zero forthwith; and/or
(b) the obligation of the Ancillary Facilities Banks to make the
Ancillary Facilities available shall be terminated, whereupon the
same shall be immediately terminated; and/or
(c) all Advances, all Ancillary Facilities Liabilities and all interest,
fees and commitment commission accrued and all other sums payable
under the Finance Documents have become due and payable or have
become due and payable on demand and all Letters of Credit have
become due for immediate discharge or have become due for immediate
discharge on demand, whereupon the same shall, immediately or in
accordance with the terms of such notice, become due and payable or
due for immediate discharge (and where Ancillary Facilities
Liabilities are so due and payable any Contingent Ancillary
Facilities Liabilities shall be due for immediate discharge); and/or
105
(d) the Security Documents (or any of them) have become enforceable (in
whole or in part); and/or
(e) any relevant Hedge Transaction between any member of the Group and a
Hedge Counterparty shall forthwith be terminated and such member of
the Group and such Hedge Counterparty shall from such time treat
such relevant Hedge Transaction as terminated by reason of
cross-default.
On or at any time after the making of any such declaration so long as the
event giving rise to such declaration is still continuing the Agent shall
be entitled, to the exclusion of the Borrowers, to select the duration of
Interest Periods.
12.3 DEMAND BASIS
If all Advances and/or the Ancillary Facilities Liabilities have become
due and payable on demand and/or the Letters of Credit due for immediate
discharge on demand in each case pursuant to clause 12.2(c), the Agent, if
so instructed by the Majority Banks, shall by written notice to Newco 2
call for repayment of the Advances and/or the Ancillary Facilities
Liabilities and/or discharge of the Letter of Credit on such date as may
be specified in such notice whereupon the Advances and/or the Ancillary
Facilities Liabilities and/or the Letters of Credit shall become due and
payable (and/or, as appropriate, due for discharge) on the date so
specified together with all interest, fees and commitment commission
accrued and all other sums payable under the Finance Documents.
12.4 CLEAN-UP PERIOD
[Not restated]
13 INDEMNITIES
13.1 MISCELLANEOUS INDEMNITIES
Each Borrower shall within three Banking Days of demand indemnify each
Finance Party, without prejudice to any of their other rights under any of
the Finance Documents, against any loss, excluding loss of Margin, or
reasonable expense which such Finance Party shall certify as sustained or
incurred by it as a consequence of (a) any default in payment by any
Borrower or any Acquisition Party or any other member of the Target Group
of any sum under any of the Finance Documents when due, (b) the occurrence
of any other Event of Default, (c) any prepayment of the Facilities or
part thereof being made otherwise than on an Interest Payment Date or, as
the case may be, Maturity Date relative thereto, (d) any Drawing not being
made for any reason (excluding any default by a Finance Party) after a
Drawdown Notice has been given, including, in any such case, but not
limited to, any loss or expense sustained or incurred in (i) maintaining
or funding its Contributions or any part thereof, (ii) liquidating or
re-employing deposits from third parties acquired or contracted for to
fund all or any part of its Contributions or (iii) closing out open
hedging positions arising.
13.2 CURRENCY OF ACCOUNT; CURRENCY INDEMNITY
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No payment by any Borrower under any of the Finance Documents which is
made in a currency other than the currency ("CONTRACTUAL CURRENCY") in
which such payment is required to be made pursuant to the relevant Finance
Documents shall discharge the obligation in respect of which it is made
except to the extent of the net proceeds in the Contractual Currency
received by the Agent upon the sale of the currency so received, after
taking into account any premium and costs of exchange in connection with
such sale. For the avoidance of doubt the Finance Parties shall not be
obliged to accept any such payment in a currency other than the
Contractual Currency nor shall the Finance Parties be liable to any
Borrower for any loss or alleged loss arising from fluctuations in
exchange rates between the date on which such payment is so received by
the Agent and the date on which the Agent effects such sale, as to which
the Agent shall (as against each Borrower) have an absolute discretion. If
any sum due from any Borrower under any Finance Document or any order or
judgment given or made in relation thereto is required to be converted
from the Contractual Currency or the currency in which the same is payable
under such order or judgment (the "FIRST CURRENCY") into another currency
(the "SECOND CURRENCY") for the purpose of (a) making or filing a claim or
proof against any Borrower, (b) obtaining an order or judgment in any
court or other tribunal or (c) enforcing any order or judgment given or
made in relation to any of the Finance Documents, each Borrower shall
indemnify and hold harmless each Finance Party from and against any loss
suffered as a result of any difference between (i) the rate of exchange
used for such purpose to convert the sum in question from the first
currency into the second currency and (ii) the rate or rates of exchange
at which each such Finance Party may in the ordinary course of business
purchase the first currency with the second currency upon receipt of a sum
paid to it in satisfaction, in whole or in part, of any such order,
judgment, claim or proof. Any amount due from any Borrower under the
indemnity contained in this clause 13.2 shall be due as a separate debt
and shall not be affected by judgment being obtained for any other sums
due under or in respect of any of the Finance Documents and the term "RATE
OF EXCHANGE" includes any premium and costs of exchange payable in
connection with the purchase of the first currency with the second
currency.
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13.3 ACQUISITION FINANCE INDEMNITY
Newco 2 agrees to indemnify and hold harmless the Finance Parties and
their Affiliates and their respective officers, lawyers, advisers,
directors, employees, agents and Holding Companies, and each of their
successors, assigns and personal representatives, from and against any and
all losses, claims, damages and liabilities (collectively "LOSSES") to
which any such person may become subject arising out of or in connection
with this Agreement, the Facilities, the Scheme, the Acquisition or any
other transaction contemplated herein, or any claim, litigation,
investigation or proceeding relating to any of the foregoing, regardless
of whether any such person is a party thereto, and to reimburse such
person upon demand for any reasonable legal or other reasonable expenses
incurred in connection with investigating or defending any of the
foregoing, except that the foregoing will not apply to any Losses arising
from the gross negligence or wilful misconduct of such indemnified person
or a material breach of this Agreement by such indemnified person.
13.4 ESCB RESERVE REQUIREMENTS
[Not restated]
13.5 ENVIRONMENTAL INDEMNITY
Newco 2 shall on demand indemnify each Finance Party against any cost or
loss suffered or incurred by such Finance Party due to any Environmental
Contamination in, on, under or escaping from any property owned, occupied
or leased by any Material Entity other than any such cost or loss caused
by or arising from the gross negligence or wilful default of such Finance
Party.
14 UNLAWFULNESS, INCREASED COSTS, ALTERNATIVE INTEREST RATES
14.1 UNLAWFULNESS
If after the date of this Agreement it becomes contrary to any law or
regulation for any relevant Bank to contribute to any Drawing or to
maintain its Commitments in respect of a Tranche or Facility or fund its
Contribution to a Tranche or Facility, such relevant Bank shall promptly,
through the Agent, notify Newco 2 whereupon (a) such relevant Bank's
Commitments shall be reduced to the extent of such illegality and (b) each
relevant Borrower shall be obliged to prepay and/or discharge the
Contribution of such relevant Bank to such Tranche or Facility on a date
not being earlier than the latest date permitted by the relevant law or
regulation. Any prepayment pursuant to this clause 14.1 shall be made
together with all amounts referred to in clause 6.7(f).
14.2 INCREASED COSTS
If the result of any change occurring after the date of this Agreement in,
or in the interpretation or application of, or the introduction of, any
law or any regulation, including (without limitation) those relating to
Taxation, capital adequacy, liquidity, reserve assets, cash ratio deposits
and special deposits, is to:
108
(a) subject any Bank to Taxes or change the basis of Taxation of any
Bank with respect to any payment under this Agreement (other than
Taxes or Taxation on the overall net income, profits or gains of
such Bank imposed in the jurisdiction in which its principal or
lending office under this Agreement is located); and/or
(b) increase the cost to, or impose an additional cost on, any Bank or
its holding company in making or keeping available all or part of
such Bank's Commitments or maintaining or funding all or part of
such Bank's Contributions; and/or
(c) reduce the amount payable or the effective return to any Bank under
this Agreement; and/or
(d) reduce any Bank's or its holding company's rate of return on its
overall capital by reason of a change in the manner in which it is
required to allocate capital resources to such Bank's obligations
under this Agreement; and/or
(e) require any Bank or its holding company to make a payment or forgo a
return calculated by reference to or on any amount received or
receivable by such Bank under this Agreement; and/or
(f) require any Bank or its holding company to incur or sustain a loss
(including a loss of profits) by reason of being obliged to deduct
all or part of such Bank's Commitments or Contributions from its
capital for regulatory purposes,
then and in each such case (but subject to clause 14.3):
(i) such Bank shall notify Newco 2 through the Agent in writing of such
event promptly upon its becoming aware of the same; and
(ii) Newco 2 shall within 5 Banking Days of demand, made at any time
whether or not such Bank's Contribution to any Facility has been
repaid, pay to the Agent for the account of such Bank the amount
which such Bank specifies (in a certificate setting forth the basis
of the computation of such amount, but not including any matters
which such Bank or its holding company regards as confidential) is
required to compensate such Bank and/or its holding company for such
liability to Taxes, increased or additional cost, reduction,
payment, forgone return or loss.
For the purposes of clauses 14.1, 14.2, 14.3 and 14.5, references to:
(x) "BANK" shall be deemed to include any Ancillary Facilities Bank;
(y) "COMMITMENTS" shall, in respect of an Ancillary Facilities Bank, be
a reference to such Ancillary Facilities Bank's obligation to
provide Ancillary Facilities; and
(z) "CONTRIBUTIONS" shall, in respect of an Ancillaries Facilities Bank,
be a reference to its Ancillary Facilities Liabilities.
109
For the purposes of this clause 14.2 each Bank may in good faith allocate
or spread costs and/or losses among its assets and liabilities (or any
class thereof) on such basis as it considers appropriate.
For the purposes of this clause 14.2 and clause 14.5 "HOLDING COMPANY"
means, in relation to a Bank, the company or entity (if any) within the
consolidated supervision of which such Bank is included.
14.3 EXCEPTIONS
Nothing in clause 14.2 shall entitle any Bank to receive any amount in
respect of compensation for any such liability to Taxes, increased or
additional cost, reduction, payment, forgone return or loss to the extent
that the same:
(a) is taken into account in calculating the Additional Cost; or
(b) is already the subject of an additional payment under clause 8.5; or
(c) arises as a consequence of (or of any law or regulation
implementing) (i) the proposals for international convergence of
capital measurement and capital standards published by the Basle
Committee on Banking Regulations and Supervisory Practices in July
1988 and/or (ii) the Banking Consolidation Directive (2000/12/EC) of
the European Union (in each case) unless it results from any change
in, or in the interpretation or application of, such proposals or
such directive (or any law or regulation implementing the same)
occurring after the date hereof.
If a Bank does not notify the Agent of its intention to claim pursuant to
clause 14.2 within ninety days after the date of which the Bank becomes
aware of the relevant (i) Taxes (ii) increased cost (iii) reduction in the
rate of return on capital or (iv) loss that Bank shall not be entitled to
claim indemnification for such Taxes, reduction in the rate of return on
capital, increased cost or loss in respect of any period of more than
ninety days before the date on which the Bank does notify the Agent of its
intention to make such claim for indemnification, payment or foregone
interest or other return. The obligation of Newco 2 to make any payment
under clause 14.2 shall survive termination of this Agreement for a period
of nine months after such termination.
14.4 MARKET DISRUPTION; NON-AVAILABILITY
(a) If and whenever, at any time prior to the commencement of any
Interest Period or Maturity Period:
(i) none or only one of the relevant Reference Banks supplies the
Agent with a quotation for the purpose of calculating LIBOR or
EURIBOR (where such a quotation is required having regard to
the definition of "LIBOR" or "EURIBOR" in clause 1.1); or
(ii) the Agent shall have received notification from relevant Banks
with Contributions aggregating not less than one-third of the
relevant Drawing or Commitments aggregating not less than
one-third of the Total Commitments in respect of the relevant
Facility
110
that deposits in Sterling or, as applicable, the relevant
Optional Currency are not available to such relevant Banks in
the relevant Interbank Market in the ordinary course of
business in sufficient amounts to fund their Contributions for
such Interest Period or Maturity Period or that LIBOR or
EURIBOR (as relevant) does not accurately reflect the cost to
such relevant Banks of obtaining such deposits;
the Agent shall forthwith give notice (a "DETERMINATION NOTICE") to
Newco 2 and to each of the Banks containing particulars of the
relevant circumstances giving rise to its issue. After the giving of
any Determination Notice the undrawn amount of the Total Commitments
may still be drawn down (subject to the other terms of this
Agreement) but on a Substitute Basis in accordance with clause
14.4(b).
(b) During the period of 10 days after the Determination Notice has been
given by the Agent under clause 14.4(a) the relevant Banks shall
(having consulted in good faith with Newco 2) certify an alternative
basis (the "SUBSTITUTE BASIS") for making available or, as the case
may be, maintaining their Contributions. The Substitute Basis may
(without limitation) include alternative interest periods,
alternative currencies or alternative rates of interest but shall
include a margin above the cost of funds (including Additional Cost)
to such relevant Banks equivalent to the applicable Margin. Each
Substitute Basis so certified shall be binding upon each Borrower
and shall take effect in accordance with its terms from the date
specified in the Determination Notice until such time as the Agent
notifies Newco 2 that none of the circumstances specified in clause
14.4(a) continues to exist, whereupon the normal interest rate
fixing provisions of this Agreement shall apply.
14.5 MITIGATION
If, in respect of any Bank, circumstances arise which would, or would upon
the giving of notice, result in:
(a) any Borrower being required to make an increased payment to any Bank
pursuant to clause 8.5;
(b) the reduction of any Bank's Commitment in respect of any Facility to
zero or any Borrower being required to prepay any Bank's
Contribution to any Facility pursuant to clause 14.1;
(c) Newco 2 being required to make a payment to any Bank to compensate
such Bank or its holding company for a liability to Taxes, increased
or additional cost, reduction, payment, forgone return or loss
pursuant to clause 14.2(ii); or
(d) any Borrower being required to make a payment determined on a
Substitute Basis pursuant to clause 14.4(b),
111
then, without in any way limiting, reducing or otherwise qualifying the
obligations of any Borrower under clause 8 and this clause 14, such Bank
shall, in consultation with the Agent and Newco 2, endeavour to take such
reasonable steps (and/or, in the case of clause 14.2(ii) and where the
increased or additional cost, reduction, payment, forgone return or loss
is that of its holding company, endeavour to procure that its holding
company takes such reasonable steps) as are open to it (or, as the case
may be, its holding company) to mitigate or remove such circumstances
(including a change in the location of its facility office or the transfer
of its rights and obligations under any Finance Document to another bank
or financial institution acceptable to Newco 2 (acting reasonably)) unless
the taking of such steps might (in the opinion of such Bank) have any
adverse effect upon its business, operations or financial condition (other
than any minor costs and expenses of an administrative nature (an amount
equal to which Newco 2 shall pay to the Agent for the account of such Bank
with 5 Banking Days of demand)).
14.6 NON-AVAILABILITY OF OPTIONAL CURRENCIES
A Working Capital Advance may not be drawn down in an Optional Currency if
(a) any Bank notifies the Agent not later than 3 p.m. on the second
Banking Day before the proposed Drawdown Date or the beginning of the
relevant Interest Period that deposits of such Optional Currency are not
readily available to such Bank in an amount comparable with such Bank's
portion of the relevant Working Capital Advance or (b) the Agent
determines after consultation with the relevant Reference Banks (which
determination shall be conclusive) at any time prior to 10 a.m. (local
time in the place of payment) on the Drawdown Date that by reason of any
change in currency availability, currency exchange rates or exchange
controls it is or will be impracticable for the relevant Working Capital
Advance to be drawn down in that Optional Currency. Accordingly, in any
such event, the relevant Working Capital Advance shall be drawn down in
Sterling.
14.7 REPLACEMENT OF BANKS
If at any time any Bank becomes a Non-Funding Bank or a Non-Consenting
Bank then Newco 2 may, on 10 Banking Days' prior written notice to the
Agent and such Bank, replace such Bank by causing such Bank to (and such
Bank shall) transfer all of its rights and obligations under this
Agreement to a Bank or other entity selected by Newco 2 and acceptable to
the Agent (acting reasonably) for a purchase price equal to such Bank's
Contribution and Ancillary Facilities Liabilities and all accrued
interest, fees and other amounts payable to it under this Agreement or its
Ancillary Facilities Letter provided that:
(a) Newco 2 shall have no right to replace the Agent;
(b) neither the Agent nor any Bank shall have any obligation to Newco 2
to find a replacement Bank or other such entity;
(c) in the event of the replacement of a Non-Consenting Bank, in order
for Newco 2 to be entitled to replace such Non-Consenting Bank, such
replacement must take place no later than 180 days after the date
the
112
Non-Consenting Bank notified the Agent and Newco 2 of its failure to
agree any requested consent, waiver or amendment;
(d) in no event shall the Bank hereby replaced be required to pay or
surrender to such replacement Bank or other entity any of the fees
received by such Bank hereby replaced pursuant to this Agreement;
and
(e) Newco 2's right to replace a Non-Funding Bank is, and shall be, in
addition to and not in lieu of all other rights and remedies
available to the Borrowers against such Non-Funding Bank under this
Agreement, at law, in equity or by statute.
For the purposes of this clause 14.7:
"NON-CONSENTING BANK" means any Bank which does not agree to a consent to
a departure from, or waiver or amendment of, any provision of the Finance
Documents which has been requested by Newco 2 or the Agent where the
requested consent, waiver or amendment (i) is not one which requires the
consent of all Banks pursuant to this Agreement and (ii) has been agreed
to by the Majority Banks; and
"NON-FUNDING BANK" means any Bank which has (i) failed to make an Advance
it is obliged to make under this Agreement and the Agent has determined
that such Bank is not likely to make such Advance or (ii) given notice to
Newco 2 or the Agent that it will not make, or that it has disaffirmed or
repudiated any obligation to make, any Advances.
15 SET-OFF AND PRO-RATA PAYMENTS
15.1 SET-OFF
Each Borrower agrees that each Finance Party may at any time after an
Event of Default has occurred and whilst it is continuing, notwithstanding
any settlement of account or other matter whatsoever, combine or
consolidate all or any of its then existing accounts wheresoever situate
(including accounts in the name of such Borrower jointly with others),
whether such accounts are current, deposit, loan or of any other nature
whatsoever, whether they are subject to notice or not and whether they are
denominated in Sterling or in any other currency, and set-off or transfer
any sum standing to the credit of any one or more such accounts in or
towards satisfaction of any moneys, obligations or liabilities covenanted
to be paid by such Borrower or for which such Borrower is liable to such
Finance Party under the Finance Documents and which, to the extent not
then payable, shall automatically become payable to the extent necessary
to effect such set-off. For this purpose each Finance Party is authorised
to purchase with the moneys standing to the credit of such account such
other currencies as may be necessary to effect such application. No
Finance Party shall be obliged to exercise any right given to it by this
clause 15.1. Each Finance Party shall notify the Agent promptly upon the
exercise or purported exercise of any right of set-off in relation to any
member of the Group giving full details in relation thereto and the Agent
shall inform the other Finance Parties.
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15.2 PRO-RATA PAYMENTS
(a) If at any time any Bank (the "RECOVERING BANK") receives or recovers
any amount owing to it by any Borrower under this Agreement by
direct payment, set-off or in any manner other than by payment
through the Agent pursuant to clause 8.1 or 8.9 (not being a payment
received from a Substitute in respect of such Bank's Contribution to
any Facility or any other payment of an amount due to the Recovering
Bank for its sole account pursuant to clauses 6.5, 7, 8.5, 13, 14.1
or 14.2), the Recovering Bank shall, within two Banking Days of such
receipt or recovery (a "RELEVANT RECEIPT"), notify the Agent of the
amount of the Relevant Receipt. If the Relevant Receipt exceeds the
amount which the Recovering Bank would have received if the Relevant
Receipt had been received by the Agent and distributed pursuant to
clause 8.1 or 8.9, as the case may be, then:
(i) within two Banking Days of demand by the Agent, the Recovering
Bank shall pay to the Agent an amount equal (or equivalent) to
the excess;
(ii) the Agent shall treat the excess amount so paid by the
Recovering Bank as if it were a payment made by the relevant
Borrower and shall distribute the same to the Banks (other
than the Recovering Bank) in accordance with clause 8.9; and
(iii) as between the relevant Borrower and the Recovering Bank the
excess amount so re-distributed shall be treated as not having
been paid, but the obligations of the relevant Borrower to the
other Banks shall, to the extent of the amount so paid to the
Agent, be treated as discharged.
(b) If any part of the Relevant Receipt subsequently has to be wholly or
partly refunded by the Recovering Bank (whether to a liquidator or
otherwise) each Bank to which any part of such Relevant Receipt was
so re-distributed shall on request from the Recovering Bank repay to
the Recovering Bank such Bank's pro-rata share of the amount which
has to be refunded by the Recovering Bank.
(c) Each Bank shall on request supply to the Agent such information as
the Agent may from time to time request for the purpose of this
clause 15.2.
(d) Notwithstanding the foregoing provisions of this clause 15.2 no
Recovering Bank shall be obliged to share any Relevant Receipt which
it receives or recovers pursuant to legal proceedings taken by it to
recover any sums owing to it under this Agreement with any other
party which has a legal right to, but does not, either join in such
proceedings or commence and diligently pursue separate proceedings
to enforce its rights in the same or another court (unless the
proceedings instituted by the Recovering Bank are instituted by it
in breach of clause 18.4).
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15.3 NO RELEASE
For the avoidance of doubt it is hereby declared that failure by any
Recovering Bank to comply with the provisions of clause 15.2 shall not
release any other Recovering Bank from any of its obligations or
liabilities under clause 15.2.
15.4 NO CHARGE
The provisions of this clause 15 shall not, and shall not be construed so
as to, constitute a charge by a Bank over all or any part of a sum
received or recovered by it in the circumstances mentioned in clause 15.2.
15.5 OTHER TRANSACTIONS
For the avoidance of doubt monies received or recovered by an Ancillary
Facilities Bank in respect of its Ancillary Facilities or by a Hedge
Counterparty in respect of the Hedge Transactions shall not be brought
into account under clause 15.2.
15.6 SHARING UNDER WORKING CAPITAL FACILITY AND THE ANCILLARY FACILITIES
(a) If the Enforcement Date occurs, each Working Capital Bank and each
Ancillary Facilities Bank shall in accordance with this clause 15.6
adjust by corresponding transfers (to the extent necessary) their
claims in respect of amounts outstanding to them under the Working
Capital Facility and the Ancillary Facilities so that after such
transfers each such Working Capital Bank and Ancillary Facilities
Bank shall have the same amount of (in the case of Ancillary
Facilities, net) outstandings (including accrued interest and
ancillary fees and charges) under the Working Capital Facility and
the Ancillary Facilities pro rata corresponding to the proportion
that the sum of such Bank's Working Capital Facility Commitment and
Ancillary Commitment bears to the sum of the total Working Capital
Facility Commitments and the total Ancillary Commitments, each as at
the Enforcement Date.
(b) On the third Banking Day following the date the Agent notifies the
Ancillary Facilities Banks that the Enforcement Date has occurred
(such third Banking Day being the "RELEVANT DATE") each of the
Ancillary Facilities Banks shall notify the Agent in writing of the
amount of its Ancillary Facilities Liabilities as at the close of
business on the date of receipt of such notification, such amount to
take account of any clearing of debits which were entered into the
clearing system of such Ancillary Facilities Bank prior to such
notification and any amounts credited to the relevant accounts prior
to such close of business.
(c) On receipt of the information referred to in clause 15.6(b), the
Agent will promptly determine what adjustment payments (if any)
would be necessary as between the Working Capital Banks and
Ancillary Facilities Banks in order to ensure that, following such
adjustment payments, the requirements of clause 15.6(a) are
achieved.
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(d) The Agent will notify all the Banks as soon as practicable of its
determinations pursuant to this clause 15.6 giving details of the
requisite adjustment payments to be made. Such adjustment payments
shall be payable in appropriate amounts (as calculated by the Agent)
by each Ancillary Facilities Bank and/or each Working Capital Bank,
as the case may be, and shall be made to the Agent within three
Banking Days following receipt by such Ancillary Facilities Bank or
such Working Capital Bank, as the case may be, of such notification
from the Agent. The adjustment payments received by the Agent shall
be distributed among the Ancillary Facilities Banks and/or the
Working Capital Banks in order to satisfy the requirements of clause
15.6(a).
(e) If at any time following the Relevant Date (and after any relevant
initial adjustment payments referred to in clause 15.6(d)), the
amount of outstandings of any Working Capital Bank or Ancillary
Facilities Bank used in the Agent's calculation of the adjustments
required should vary for any reason (including where any amount of
contingent liabilities previously taken into account in calculating
such Bank's outstandings at any relevant time is finally discharged
without such Bank actually incurring liabilities to the extent of
the amount so included), further adjustment payments shall be made
on the same basis (mutatis mutandis) provided for in clauses 15.6(b)
and (d).
(f) In respect of any amount paid by an Ancillary Facilities Bank or a
Working Capital Bank (the "PAYING BANK") pursuant to either of
clauses 15.6(d) or (e), as between the relevant Borrower and the
Paying Bank, the amount so paid shall be immediately due and payable
by the relevant Borrower to the Paying Bank but the payment
obligations of the Borrower to the Ancillary Facilities Bank or such
Working Capital Bank, as the case may be, which received such
payment shall be treated as correspondingly reduced by the amount of
such payment.
(g) Each Ancillary Facilities Bank and each Working Capital Bank shall
on request supply to the Agent such information as the Agent may
from time to time request for the purpose of this clause 15.6.
(h) If an Ancillary Facilities Bank has the benefit of any Encumbrance
securing any of its Ancillary Facilities, the realisations from such
security when enforced shall either (i) reduce the amount of its
outstandings for the purposes of this clause 15.6 or (ii) will be
treated as an amount recovered by such Ancillary Facilities Bank in
its capacity as a Bank which is subject to pro-rata sharing
arrangements in clause 15.2, to the intent that such realisations
should benefit all Banks pro-rata.
16 ASSIGNMENT, SUBSTITUTION AND LENDING OFFICES
16.1 BENEFIT AND BURDEN
This Agreement shall be binding upon, and enure for the benefit of, the
Finance Parties and the Borrowers and their respective successors.
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16.2 NO ASSIGNMENT BY THE BORROWERS
The Borrowers may not assign or otherwise transfer any of their respective
rights or obligations under any of the Finance Documents.
16.3 SUBSTITUTION
Each Bank (an "EXISTING BANK") may (subject to clause 16.9) transfer, by
way of novation (but not by way of assignment or otherwise, save that any
Bank which is a special purpose entity under collateralised debt
obligation securitisation arrangements may assign by way of security its
rights in respect of the Facilities as part of such arrangements), all or
any part of its rights, benefits and/or obligations under this Agreement
to another person (a "SUBSTITUTE"):
(a) with the consent of the Fronting Bank (in the case of the Working
Capital Facility) and until the Second Syndication Completion Date,
after consultation with Newco 2, but without the consent of Newco 2
or the other Obligors;
(b) thereafter, with the consent of the Fronting Bank (in the case of
the Working Capital Facility) and after obtaining the prior written
consent of Newco 2 (such consent not to be unreasonably withheld or
delayed) but without the consent of any other party; or
(c) at any time, with the consent of the Fronting Bank (in the case of
the Working Capital Facility) but without any consultation with or
consent from Newco 2 (in the case of a transfer to another Bank or
to a Bank Affiliate of a Bank).
Any such novation shall be effected upon not less than 5 Banking Days'
prior notice by delivery to the Agent of a duly completed Substitution
Certificate duly executed by the Existing Bank and the Substitute. On the
Transfer Effective Date (as specified and defined in a Substitution
Certificate so executed and delivered), to the extent that the Commitments
and Contributions of the Existing Bank are expressed in a Substitution
Certificate to be the subject of the novation in favour of the Substitute
effected pursuant to this clause 16.3, by virtue of the counter-signature
of the Substitution Certificate by the Agent (for itself and the other
parties to this Agreement) and by virtue of the recording of such
transfers in the Register (as defined in clause 16.11):
(a) the existing parties to this Agreement and the Existing Bank shall
be released from their respective obligations towards one another
under this Agreement ("DISCHARGED OBLIGATIONS") and their respective
rights against one another under this Agreement ("DISCHARGED
RIGHTS") shall be cancelled;
(b) the Substitute party to the relevant Substitution Certificate and
the existing parties to this Agreement (other than such Existing
Bank) shall assume obligations towards each other which differ from
the discharged obligations only insofar as they are owed to or
assumed by such Substitute instead of to or by such Existing Bank;
and
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(c) the Substitute party to the relevant Substitution Certificate and
the existing parties to this Agreement (other than such Existing
Bank) shall acquire rights against each other which differ from the
discharged rights only insofar as they are exercisable by or against
such Substitute instead of by or against such Existing Bank;
and, on such Transfer Effective Date, the Substitute shall (unless such
novation is part of the primary syndication process carried out by the
Arrangers) pay to the Agent for its own account a fee of (pound)1,000. The
Agent shall promptly notify the other Banks and Newco 2 of the receipt by
it of any Substitution Certificate.
16.4 RELIANCE ON SUBSTITUTION CERTIFICATE
The Agent (on behalf of itself and the Security Agent and the Borrowers)
shall be fully entitled to rely on any Substitution Certificate delivered
to the Agent in accordance with the foregoing provisions of this clause 16
which is complete and regular on its face as regards its contents and
purportedly signed on behalf of the relevant Existing Bank and the
Substitute and none of the Agent, the Security Agent and the Borrowers
shall have any liability or responsibility to any party as a consequence
of placing reliance on and acting in accordance with any such Substitution
Certificate if it proves to be the case that the same was not authentic or
duly authorised.
16.5 AUTHORISATION OF AGENT
Each party to this Agreement irrevocably authorises the Agent to
counter-sign each Substitution Certificate on its behalf for the purposes
of clause 16.3 without any further consent of, or consultation with, such
party.
16.6 CONSTRUCTION OF CERTAIN REFERENCES
If any Bank novates all or any part of its rights, benefits and
obligations as provided in clause 16.3 all relevant references in this
Agreement to such Bank shall thereafter be construed as a reference to
such Bank and/or its Substitute to the extent of their respective
interests. If a Bank which novates all of its rights, benefits and
obligations as provided in clause 16.3 is an Ancillary Facilities Bank or
a Hedge Counterparty at the time of such novation, it shall,
notwithstanding such novation, remain an Ancillary Facilities Bank or a
Hedge Counterparty (as the case may be) in respect of those Ancillary
Facilities or those Hedge Transactions (as the case may be) which it
entered into while it was a Bank and shall remain a party to this
Agreement in such capacity or capacities.
16.7 LENDING OFFICES
Each Bank shall lend through its office at the address specified in
schedule 1 or, as the case may be, in any relevant Substitution
Certificate or through any other office of such Bank selected from time to
time by such Bank through which such Bank wishes to lend for the purposes
of this Agreement but subject to clause 16.10. If the office through which
a Bank is lending is changed pursuant to this clause 16.7, such Bank shall
notify the Agent promptly of such change.
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16.8 DISCLOSURE OF INFORMATION
(a) Any Bank may disclose to (a) a prospective transferee, (b) any other
person who may propose entering into contractual relations with such
Bank in relation to this Agreement or (c) any person to whom
information may be required to be disclosed by any applicable law or
any regulatory authority or (d) Standard & Poor's Ratings Group,
▇▇▇▇▇'▇ Investor Service, Inc., Fitch, Inc. or another
internationally recognised rating agency such information obtained
under this Agreement about Newco 2, the other Acquisition Parties
and the Group as such Bank shall consider appropriate provided that,
in relation to a disclosure under (a) and (b) above, the person to
whom such information is to be given has entered into a
confidentiality undertaking in the standard form from time to time
of the Loan Market Association.
(b) Notwithstanding any other provision of any Finance Document, each
party to any Finance Document (and any of its officers, directors,
employees, representatives, professional advisers, or other agents)
may disclose to any and all persons, without limitation of any kind:
(i) the tax treatment and tax structure (each as defined below) of
the Facilities; and
(ii) all materials of any kind (including opinions or other tax
analyses) that are provided to such party relating to such tax
treatment or tax structure.
For the purposes of this clause 16.8 the "TAX TREATMENT" of the
Facilities is the purported or claimed U.S. Federal income tax
treatment of the Facilities, and the "TAX STRUCTURE" of the
Facilities is any fact that may be relevant to understanding the
purported or claimed U.S. Federal income tax treatment of the
Facilities".
16.9 DETAILS OF NOVATIONS
(a) Other than the Amendment Underwriters or with the prior written
consent of the Amendment Underwriters, no Bank may transfer, by way
of novation, all or any part of its rights, benefits and/or
obligations under this Agreement (other than to a Bank Affiliate or
to an Amendment Underwriter) until the Second Syndication Completion
Date. Thereafter, novations of each of the Tranches or Facilities
may be made separately.
(b) Where a Bank novates part of its rights, benefits and obligations in
respect of any Tranche or Facility pursuant to clause 16.3, that
Bank must novate equal fractions of its Commitments and
Contributions (if any) in respect of the relevant Tranche or
Facility being novated and, if at the time when such novation takes
effect more than one Drawing is outstanding under such Tranche or
Facility, the novation of its Contributions shall take effect in
respect of the same fraction of each Drawing.
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(c) The Substitution Certificate relating to any such novation shall be
completed accordingly.
(d) No novation shall be effected if, as a consequence of that novation
(or as a consequence of that and any other novation between the same
or related parties taking effect at or about the same time), the
combined Commitments and Contributions of a Bank would be less than
approximately (pound)5,000,000 (or, in the case of a Bank which only
has Commitments and Contributions in respect of Facility B,
(pound)2,000,000) (unless such Bank is novating all of its
Commitments and Contributions), provided, however, that for these
purposes persons that are Bank Affiliates of each other shall be
treated together as one Bank so that individual Bank Affiliates may
have total Commitments of less than (pound)5,000,000 (or, as the
case may be, (pound)2,000,000) if the total Commitments of all such
Bank Affiliates together are at least (pound)5,000,000 (or, if all
such Bank Affiliates only have Commitments and Contributions in
respect of Facility B, (pound)2,000,000).
16.10 NO ADDITIONAL AMOUNTS
If any Bank changes its lending office or assigns all or any part of its
rights or benefits or transfers all or any part of its obligations under
this Agreement and at the effective date of such change of office transfer
or assignment any additional amounts would, but for this clause 16.10, be
payable by a Borrower under clauses 8.5 (grossing up) or 14.2 (increased
costs), then the obligations of such Borrower under such clauses to such
Bank or the assignee, transferee or Substitute (as the case may be) shall
not, unless such Borrower has consented otherwise, exceed what such
Borrower's obligations would have been (calculated rateably in the case of
a partial transfer or assignment) had no such change of office, transfer
or assignment taken place.
16.11 THE REGISTER
(a) The Agent, acting as the agent of the Borrowers for the purposes of
clause 16.3, shall maintain at one of its offices a copy of each
Substitution Certificate delivered to it and a register for the
recordation of the names and addresses of the Banks, the Commitments
and Contributions of, and principal amount of the Advances owing to,
each Bank pursuant to the terms hereof from time to time (the
"REGISTER"). The entries in the Register shall be conclusive, and
the Borrowers, the Agent and the Banks may treat each person whose
name is recorded in the Register pursuant to the terms hereof as a
Bank hereunder for all purposes of this Agreement, notwithstanding
notice to the contrary.
(b) Upon its receipt of a duly completed Substitution Certificate
executed by an Existing Bank and a Substitute, and, if applicable,
the fee referred to in clause 16.3, the Agent shall accept such
Substitution Certificate and record the information contained
therein in the Register. No transfer shall be effective for purposes
of this Agreement unless it has been recorded in the Register as
provided in this clause 16.11.
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16.12 BANK AFFILIATES
(a) It is agreed that notwithstanding any other provision of this
Agreement, a Bank may elect to fulfil its Commitment in respect of
any relevant Facility in respect of Drawings by a Borrower by
performing its obligations under this Agreement through a different
lending office or by joining a Bank Affiliate of such Bank as a
party to this Agreement for this purpose in the manner provided for
in clause 16.12(b). Having so joined such Bank Affiliate such Bank
and such Bank Affiliate will be treated as having a single
Commitment for the purposes of the relevant Facility but, for all
other purposes other than mentioned in clauses 16.12(b) and
16.12(c), will each be treated as Banks.
(b) A Bank may provide for a different lending office to participate in
certain Drawings in the manner contemplated in clause 16.12(a) by
giving notice to this effect under clause 16.7. A Bank may provide
for a Bank Affiliate to participate in such Drawing in such manner
by:
(i) joining the relevant Bank Affiliate in as a Bank by means of a
Substitution Certificate in accordance with clause 16.3 (for
which purpose the Bank (as the "EXISTING BANK") and the Bank
Affiliate (as the "SUBSTITUTE") shall adopt, as a single
Commitment, such Bank's Commitment in respect of the relevant
Facility); and
(ii) giving notice to the Agent and Newco 2, detailing in
accordance with the relevant Substitution Certificate the
Drawings in which such Bank Affiliate will participate,
in which event that Bank and its Bank Affiliate:
(A) will be treated as having a single Commitment, but, for
all other purposes other than that mentioned in clause
16.12(c), will be treated as separate Banks; and
(B) shall participate in Drawings as contemplated by the
notice given pursuant to clause 16.12(b)(ii).
(c) For the purposes of:
(i) compliance with clause 16.3 and
(ii) voting in connection with this Agreement or any other Finance
Document,
each Bank and its Bank Affiliate will be regarded as a single Bank.
17 APPOINTMENT OF AGENT AND SECURITY AGENT
17.1 APPOINTMENT
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Each Bank irrevocably appoints the Agent as its agent for the purposes of
this Agreement and each Finance Party irrevocably appoints the Security
Agent as its trustee for the purposes of the Security Documents and
irrevocably authorises the Agent and the Security Agent (as appropriate)
in such capacities:
(a) to execute each of the Security Documents and all such further
documents as may be approved by the Majority Banks for execution by
the Security Agent;
(b) (whether or not by or through employees or agents) to take such
action on such Bank's or, as the case may be, such Finance Party's
behalf and to exercise such rights, remedies, powers and discretions
as are specifically delegated to the Agent or, as the case may be,
the Security Agent by this Agreement or, as the case may be, the
Security Documents, together with such powers and discretions as are
reasonably incidental thereto (but subject to any restrictions or
limitations specified in this Agreement and/or, as the case may be,
the Security Documents). Neither the Agent, the Arrangers nor the
Security Agent shall, however, have any duties, obligations or
liabilities (whether fiduciary or otherwise) to the other Finance
Parties beyond those expressly stated in this Agreement and/or (in
the case of the Security Agent) the Security Documents; and
(c) to accept on behalf of the Finance Parties the terms of any reliance
letter or engagement letter relating to the Reports or any reports
or letter provided by the report providers in connection with the
Finance Documents or the transactions contemplated therein
(including any net asset letter in connection with financial
assistance procedures) and to bind the Finance Parties in respect of
such Reports, reports or letters and to sign such letters on their
behalf and each Finance Party further confirms that it accepts the
terms and qualifications set out in such letters.
Notwithstanding that the Agent and the Security Agent may from time to
time be the same entity, the Agent and Security Agent have entered into
this Agreement in their separate capacities as agent for the Banks under
and pursuant to this Agreement and as security trustee for the Finance
Parties to hold the security created or to be created by the Security
Documents on the terms set out in the Security Documents and/or in this
Agreement. However, where this Agreement provides for the Agent to
communicate with or provide instructions to the Security Agent, while the
Agent and the Security Agent are the same entity it will not be necessary
for there to be any such formal communications or instructions
notwithstanding that this Agreement provides in certain cases for the same
to be in writing.
17.2 AGENT'S AND SECURITY AGENT'S ACTIONS
Any action taken by the Agent or the Security Agent under or in relation
to this Agreement and/or any Security Document with requisite authority,
or on the basis of appropriate instructions, received from the Majority
Banks (or as otherwise duly authorised) shall be binding on all the Banks
(in respect of action
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taken by the Agent) and all the Finance Parties (in respect of action
taken by the Security Agent).
17.3 AGENT'S DUTIES
The Agent shall:
(a) promptly notify each Bank of the contents of each notice,
certificate or other document received by the Agent under or
pursuant to clause 10;
(b) consult with the Banks and the other Finance Parties as to whether
and, if so, how a discretion vested in the Security Agent is, either
in any particular instance or generally, to be exercised but so that
this shall not prevent the Security Agent, in exceptional
circumstances where time does not permit such consultation and
urgent action is required, from exercising its rights and powers to
preserve the security constituted by the Security Documents so long
as the Security Agent promptly notifies the other Finance Parties
subsequently of such exercise; and
(c) (subject to the other provisions of this clause 17) take such action
or, as the case may be, refrain from taking such action with respect
to the exercise of any of its rights, remedies, powers and
discretions as agent or security trustee, as the Majority Banks may
reasonably direct.
17.4 AGENT'S AND SECURITY AGENT'S RIGHTS
The Agent or, in respect of the Security Documents, the Security Agent
may:
(a) in the exercise of any right, remedy, power or discretion in
relation to any matter, or in any context, not expressly provided
for by this Agreement, act or, as the case may be, refrain from
acting in accordance with the instructions of the Majority Banks,
and shall be fully protected in so doing;
(b) unless and until it shall have received directions from the Majority
Banks, take such action, or refrain from taking such action, in
respect of a Default of which the Agent or, as the case may be, the
Security Agent has actual knowledge as it shall deem advisable in
the best interests of the Banks (but shall not be obliged to do so);
(c) refrain from acting in accordance with any instructions of the
Majority Banks to institute any legal proceedings arising out of or
in connection with this Agreement and/or the Security Documents
until it has been indemnified and/or secured to its satisfaction
against any and all costs, expenses or liabilities (including legal
fees) which it would or might incur as a result;
(d) deem and treat (i) each Bank as the person entitled to the benefit
of the Contributions of such Bank for all purposes of this Agreement
and the Security Documents unless and until a Substitution
Certificate shall have been filed with the Agent and shall have
become effective, and (ii) the office set opposite the name of each
Bank in schedule 1 or, as the case
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may be, in any relevant Substitution Certificate as such Bank's
lending office unless and until a written notice of change of
lending office shall have been received by the Agent; and the Agent
or, as the case may be, the Security Agent may act upon any such
notice unless and until the same is superseded by a further such
notice;
(e) rely as to matters of fact which might reasonably be expected to be
within the knowledge of any Borrower upon a certificate signed by
any director of such Borrower on behalf of such Borrower; and
(f) refrain from doing anything which would, or might in its opinion, be
contrary to any law or regulation of any jurisdiction and may do
anything which is in its opinion necessary or desirable to comply
with any such law or regulation.
17.5 NO LIABILITY OF ARRANGERS, SECURITY AGENT AND AGENT
None of the Arranger, the Security Agent, the Agent or any of their
respective employees and agents shall:
(a) be obliged to request any certificate or opinion under any provision
of the Finance Documents or to make any enquiry as to the use of the
proceeds of the Facilities unless (in the case of the Agent) so
required in writing by any Bank, in which case the Agent shall
promptly make the appropriate request of Newco 2; or
(b) be obliged to make any enquiry as to any breach or default by any
Borrower or any Acquisition Party or any other member of the Group
in the performance or observance of any of the provisions of any
Finance Document or as to the existence of a Default unless (in the
case of the Agent) the Agent has actual knowledge thereof or has
been notified in writing thereof by a Bank, in which case the Agent
shall promptly notify the Banks of the relevant event or
circumstance; or
(c) be obliged to enquire whether or not any representation or warranty
made by any Borrower or any Acquisition Party or any other member of
the Group pursuant to any Finance Document is true; or
(d) be obliged to do anything (including, without limitation, disclosing
any document or information) which would, or might in its opinion,
be contrary to any law or regulation or be a breach of any duty of
confidentiality or otherwise be actionable or render it liable to
any person; or
(e) be obliged to account to any Finance Party for any sum or the profit
element of any sum received by it for its own account; or
(f) be obliged to institute any legal proceedings arising out of or in
connection with, or otherwise take steps to enforce, any Finance
Document (and in the case of the Security Agent in respect of the
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Security Documents) other than on the instructions of the Majority
Banks; or
(g) be liable to any Finance Party for any action taken or omitted under
or in connection with any Finance Document or the Facilities unless
caused by its gross negligence or wilful misconduct.
For the avoidance of doubt, the Security Agent shall not be obliged to
become a mortgagee or heritable creditor in possession.
For the purposes of this clause 17 the Agent and the Security Agent shall
not be treated as having actual knowledge of any matter of which the
corporate finance or any other division outside the agency department of
the person for the time being acting as the Agent or, as appropriate,
Security Agent may become aware in the context of corporate finance,
advisory or lending activities from time to time undertaken by the Agent
or, as appropriate, Security Agent for the Borrowers or any of their
Subsidiaries or Affiliates or associated companies or any other person
which may be a trade competitor of the Group or any member of it or may
otherwise have commercial interests similar to those of the Group or any
member of it.
17.6 NON-RELIANCE ON ARRANGERS, SECURITY AGENT OR AGENT
Each Finance Party acknowledges, by virtue of its execution of this
Agreement or, as the case may be, a Substitution Certificate, that it has
not relied on any statement, opinion, forecast or other representation
(including, without limitation, anything contained in the Information
Memorandum) made by the Arrangers, the Security Agent or the Agent to
induce it to enter into this Agreement or any other Finance Document and
that it has made and will continue to make, without reliance on the Agent,
the Security Agent or the Arrangers and based on such documents as it
considers appropriate, its own appraisal of the creditworthiness of each
Borrower and the Group and its own independent investigation of the
financial condition, prospects and affairs of each Borrower and the Group
in connection with the making and continuation of the Facilities under
this Agreement and the other Finance Documents. None of the Arrangers, the
Security Agent or the Agent shall at any time be deemed to have had or
have any duty or responsibility, either historically, initially or on a
continuing basis, to provide any Finance Party with any credit or other
information with respect to any Borrower or any other member of the Group
whether coming into its possession before the making of any Drawing or at
any time or times thereafter, other than (in the case of the Agent) as
provided in clauses 17.3(a) and 17.5(a).
17.7 NO RESPONSIBILITY ON ARRANGERS, SECURITY AGENT OR AGENT FOR CERTAIN
MATTERS
None of the Arrangers, the Security Agent nor the Agent shall have any
responsibility or liability to any Finance Party:
(a) on account of the failure of any member of the Group or any
Acquisition Party to perform any of its obligations under any of the
Finance Documents; or
125
(b) for the financial condition of any member of the Group or any
Acquisition Party; or
(c) for the completeness, adequacy or accuracy of any statements,
representations or warranties in the Information Package or any of
the Finance Documents or any document delivered under any of such
documents; or
(d) for the execution, effectiveness, adequacy, genuineness, validity,
enforceability or admissibility in evidence of the Finance Documents
or of any certificate, report or other document executed or
delivered under any of the Finance Documents; or
(e) to ascertain whether all deeds and documents which should have been
deposited with it under or pursuant to any of the Security Documents
have been so deposited; or
(f) to investigate or make any enquiry into the title of the Charging
Group to any of the Charged Assets; or
(g) for the failure to register any of the Security Documents with the
Registrar of Companies, the Patent Office, H.M. Land Registry, the
Trade Marks Registry or any other public office; or
(h) for the failure to register any of the Security Documents in
accordance with the provisions of the documents of title of the
Charging Group to any of the Charged Assets; or
(i) for the failure to effect or procure the registration of any
floating charge created by any of the Security Documents by
registering under the Land Registration ▇▇▇ ▇▇▇▇ any notice, caution
or other entry prescribed by or pursuant to the provisions of the
said Act against any land for the time being forming part of the
security; or
(j) for the failure to take or require Newco 2, any other Borrower or
any other member of the Charging Group to take any steps to render
any of the Security Documents effective as regards property or
assets outside England or Wales or to secure the creation of any
ancillary charge under the laws of the jurisdiction concerned; or
(k) (save as otherwise provided in this clause 17) for taking or
omitting to take any other action under or in relation to the
Security Documents or any aspect thereof; or
(l) in the case of the Arrangers and the Agent, on account of the
failure of the Security Agent to perform or discharge any of its
duties or obligations under the Security Documents; or
(m) (save as otherwise provided in this clause 17) otherwise in
connection with the Facilities or their negotiation or for acting
(or, as the case may be, refraining from acting) in accordance with
the instructions of the Majority Banks.
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17.8 RELIANCE ON DOCUMENTS AND PROFESSIONAL ADVICE
The Arrangers, the Security Agent and the Agent shall be entitled to rely
on any communication, instrument or document believed by it to be genuine
and correct and to have been signed or sent by the proper person and shall
be entitled to rely as to legal or other professional matters on opinions
and statements of any legal or other professional advisers selected or
approved by it (including those in the Agent's or, as the case may be, the
Security Agent's employment).
17.9 OTHER DEALINGS
The Arrangers, the Security Agent and the Agent may, without any liability
to account to the other Finance Parties, accept deposits from, lend money
to, and generally engage in any kind of banking or other business with, be
the owner or holder of any shares or other securities of, and provide
advisory or other services to, Newco 2 or any Acquisition Party or any of
their respective Subsidiaries, Affiliates or associated companies or any
of the Finance Parties as if it were not an Arranger, the Security Agent
or the Agent, as the case may be.
17.10 RIGHTS OF AGENT AND SECURITY AGENT AS BANK; NO PARTNERSHIP
With respect to its own Commitments and Contributions (if any) each of the
Agent and the Security Agent shall have the same rights and powers under
this Agreement and the Security Documents as any other Bank and may
exercise the same as though it were not performing the duties and
functions delegated to it under this Agreement and/or the Security
Documents and the term "Banks" shall, unless the context clearly otherwise
indicates, include the Agent and the Security Agent in their individual
capacities as Banks. This Agreement shall not and shall not be construed
so as to constitute a partnership between the parties or any of them.
17.11 AMENDMENTS AND WAIVERS
(a) Majority Bank matters
Subject to clause 17.11(b), (c) and (e) the Agent may, with the
consent of the Majority Banks (or if and to the extent expressly
authorised by the other provisions of this Agreement) and, if so
instructed by the Majority Banks, shall: (i) agree amendments or
modifications to this Agreement with Newco 2 (on behalf of all the
Borrowers) and/or vary or waive breaches of, or defaults under, or
otherwise excuse performance of, any provision of this Agreement by
any Borrower; and/or (ii) authorise the Security Agent (on behalf of
the Finance Parties) to agree amendments or modifications to the
Security Documents with Newco 2 (on behalf of all members of the
Charging Group) and/or vary or waive breaches of, or defaults under,
or otherwise excuse performance of, any provision of any of the
Security Documents by any member of the Charging Group.
Any such action so authorised and effected by the Agent shall be
documented in such manner as the Agent shall (with the approval of
the Majority Banks) determine, shall be promptly notified to the
Banks by
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the Agent and (without prejudice to the generality of clause 17.2)
shall be binding on all the Banks.
(b) All Bank matters; security
Except with the prior written consent of all the Banks, the Agent
shall not have authority on behalf of the Banks to authorise the
Security Agent to agree amendments or modifications to the Security
Documents with the members of the Charging Group (or Newco 2 on
their behalf) and/or vary or waive breaches of, or defaults under,
or otherwise excuse performance of, any provision of any of the
Security Documents by any member of the Charging Group if the effect
of such would be to (i) release any member of the Charging Group
from the security constituted by any Security Document (provided
that where such release of a member of the Charging Group arises as
a result of a permitted disposal of such member pursuant to clause
10.6(f), no such consent of the Banks shall be required), (ii)
release any of the Charged Assets from the security constituted by
any Security Document other than any such release as part of a
disposal which is not restricted by the terms of this Agreement,
(iii) release any member of the Charging Group from any of its
guarantee or other assurance obligations under any of the Security
Documents or (iv) agree with Newco 2 or any other member of the
Charging Group any amendment of, or action in relation to, any of
the Security Documents which would have the effect of (x) extending
the due date or reducing the amount of any payment under any
Security Document or (y) changing the currency in which any amount
is payable under any Security Document.
(c) All Bank matters; general
Except with the prior written consent of all the Banks, the Agent
shall not have authority on behalf of the Banks to agree with any
Borrower any amendment or modification to this Agreement or to vary
or waive breaches of or defaults under or otherwise excuse
performance of any provision of this Agreement by any Borrower, if
the effect of such would be to (i) reduce the applicable Margin,
(ii) postpone the due date or reduce the amount of any scheduled
payment of principal, interest, commitment commission or other
amount payable by any Borrower under this Agreement, (iii) change
the currency in which any amount is payable by any Borrower under
this Agreement, (iv) increase any Bank's Commitments, (v) extend any
period during which a Drawdown Notice may be delivered (other than
in respect of the Second Tranches, where only the consent of the
Amendment Underwriters is required), (vi) change the definition of
"Majority Banks" in clause 1.1, (vii) change any provision of this
Agreement which expressly requires the approval or consent of all
the Banks such that the relevant approval or consent may be given
otherwise than with the sanction of all the Banks, (viii) change the
order of distribution under clause 8.9, (ix) change clause 15.2 or
(x) change this clause 17.11.
(d) Deeds of adherence
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For the purposes of this clause 17.11 it is expressly agreed and
acknowledged that the execution of a guarantee and/or deed of
adherence by a new Subsidiary or other charging company or any deed
or instrument pursuant to a further assurance provision in this
Agreement or the Security Documents shall not constitute an
amendment or modification to, or variation of, any of the Security
Documents.
(e) Facility B Banks Matters
Except with the prior written consent of all of the Facility B
Banks, the Facility Agent shall not have the authority on behalf of
the Banks to agree with Newco 2 any amendment, modification or
waiver if the effect of that would be to change clause 6.7(i) or
this clause 17.11(e).
17.12 REIMBURSEMENT AND INDEMNITY BY BANKS
Each Bank shall reimburse the Arrangers, the Security Agent and the Agent
(rateably in accordance with its Commitments), to the extent that the
Arrangers, the Security Agent or the Agent is not reimbursed by any
Borrower, for the costs, charges and expenses incurred by the Arrangers,
the Security Agent and the Agent in connection with the preparation and
distribution of the Information Memorandum and advertising in connection
with this Agreement as agreed between Newco 2 and the Arrangers and/or in
contemplation of, or otherwise in connection with, the enforcement or
attempted enforcement of, or the preservation or attempted preservation of
any rights under, or in carrying out its duties under ▇▇▇ of the Finance
Documents including (in each case) the fees and expenses of legal or other
professional advisers. Each Bank shall on demand indemnify the Agent and
the Security Agent (rateably in accordance with its Commitments) against
all liabilities, damages, costs and claims whatsoever incurred by the
Agent or the Security Agent in connection with any of the Finance
Documents or the performance of its duties under the Finance Documents or
any action taken or omitted by the Agent or the Security Agent under any
of the Finance Documents, unless such liabilities, damages, costs or
claims arise from the Agent's or, as the case may be, the Security Agent's
own gross negligence or wilful misconduct. Each Borrower shall
counter-indemnify the Banks against all payments by them under this clause
17.12.
17.13 RETIREMENT OF AGENT AND SECURITY AGENT
(a) The Agent and the Security Agent may (following consultation with
Newco 2) retire from its appointment as Agent or Security Agent
respectively under this Agreement and the Intercreditor Agreement
and, in the case of the Security Agent, the Security Documents
having given to Newco 2 and each of the Banks (and, in the case of
the Security Agent, the other Finance Parties) not less than 30
days' notice of its intention to do so, provided that no such
retirement shall take effect unless there has been appointed by the
Banks as a successor agent or successor security trustee, as the
case may be:
(i) a Bank nominated by the Majority Banks or, failing such a
nomination,
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(ii) any reputable and experienced bank or financial institution
with offices in London nominated by the Agent or the Security
Agent.
Any corporation into which the Agent or the Security Agent may be
merged or converted or any corporation with which the Agent or the
Security Agent may be consolidated or any corporation resulting from
any merger, conversion, amalgamation, consolidation or other
reorganisation to which the Agent or the Security Agent shall be a
party shall, to the extent permitted by applicable law, be the
successor Agent or, as the case may be, Security Agent under this
Agreement and the Security Documents (as appropriate) without the
execution or filing of any document or any further act on the part
of any of the parties to this Agreement or, as the case may be, the
Security Documents save that notice of any such merger, conversion,
amalgamation, consolidation or other reorganisation shall forthwith
be given to Newco 2 and the Finance Parties.
(b) Upon any such successor as aforesaid being appointed, the retiring
Agent or Security Agent shall be discharged from any further
obligation under this Agreement and, in the case of the Security
Agent, the Security Documents (but shall continue to have the
benefit of this clause 17 in respect of any action it has taken or
refrained from taking prior to such discharge) and its successor and
each of the other parties to this Agreement or, as the case may be,
the Security Documents shall have the same rights and obligations
among themselves as they would have had if such successor had been a
party to this Agreement or, as the case may be, the Security
Documents in place of the retiring Agent or Security Agent. The
retiring Agent or Security Agent shall (at the expense of Newco 2)
provide its successor with copies of such of its records as its
successor reasonably requires to carry out its functions as such.
(c) It is the intention that (except only as may be agreed in writing
between any retiring Security Agent and its successor with the prior
approval of the Majority Banks), upon the appointment of any
successor to the Security Agent, the property, assets and rights
vested in the retiring Security Agent pursuant to the Security
Documents should, with immediate effect, be vested in such successor
Security Agent under the provisions of the Trustee ▇▇▇ ▇▇▇▇, either
by operation of law or, failing that, by assignment or other form of
transfer or conveyance. At any time and from time to time following
the appointment of any such successor to the Security Agent, the
retiring Security Agent shall do and execute all acts, deeds and
documents reasonably required by such successor in order to transfer
to such successor Security Agent (or its nominee, as such successor
may direct) any such property, assets and rights which shall not
have vested in such successor by operation of law. All such acts,
deeds and documents shall be done or, as the case may be, executed
at the cost of the Borrowers.
17.14 CHANGE OF REFERENCE BANKS
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If (a) the whole of the Contributions (if any) of any Reference Bank are
prepaid, (b) the Commitments (if any) of any Reference Bank are reduced to
zero in accordance with clause 6.5 or 14.1, (c) a Reference Bank novates
the whole of its rights and obligations (if any) as a Bank under this
Agreement or (d) a Reference Bank ceases to provide quotations to the
Agent upon request for the purposes of schedule 4 or for the purposes of
determining LIBOR or EURIBOR (as the case may be) (where such quotations
are required having regard to the definition of "LIBOR" or "EURIBOR" in
clause 1.1) the Agent may, acting on the instructions of the Majority
Banks, terminate the appointment of such Reference Bank and with the
consent of Newco 2 (such consent not to be unreasonably withheld or
delayed) appoint another Bank to replace such Reference Bank.
17.15 DECLARATION OF TRUST
The Security Agent hereby accepts its appointment under clause 17.1 as
trustee of the Trust Property with effect from the date of this Agreement
to hold the same on trust for itself and the other Finance Parties and to
apply the same in accordance with the following respective claims:
(a) first, as to a sum equivalent to the amounts payable to the Security
Agent under clause 17.20 and clauses 10.1 and 10.4 of the Group
Debenture and any equivalent or similar provisions in any other
Security Document from time to time (excluding any amounts received
by the Security Agent pursuant to clause 17.12), for the Security
Agent absolutely;
(b) secondly, as to a sum equivalent to the amounts standing to the
credit of any Cash Collateral Accounts in respect of Ancillary
Facilities Liabilities or otherwise standing to the credit of any
accounts which have been netted against Ancillary Facilities
Liabilities under the terms of the Ancillary Facilities Letters
which operate on a net limit basis in each case from time to time
and to the extent that for any reason the relevant Ancillary
Facilities Banks are unable to apply such amounts in satisfaction of
Ancillary Facilities Liabilities, for such relevant Ancillary
Facilities Banks absolutely, pro-rata in respect of each such
relevant Ancillary Facilities Bank;
(c) thirdly, as to a sum equivalent to the aggregate amount owing to the
Finance Parties (other than the Security Agent and (to the extent
that they are satisfied pursuant to clauses 17.15(b) and 17.22) the
Ancillary Facilities Banks) under the Finance Documents and for the
Finance Parties absolutely, and pro-rata (with the Security Agent
obtaining a good discharge in respect of the amounts expressed to be
due to the Arrangers, the Agent and the Banks under the terms of
this Agreement by paying such amounts to the Agent for distribution
in accordance with clause 8.9);
(d) fourthly, to such other persons (if any) as are legally entitled
thereto in priority to the Borrowers and the Charging Subsidiaries;
and
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(e) fifthly, as to the balance (if any) for the Borrowers and the
Charging Subsidiaries absolutely pro-rata to the respective amounts
paid, received or recovered from each of them.
The Security Agent shall make each such application and/or distribution as
soon as is practicable after the relevant moneys are received by, or
otherwise become available to, the Security Agent save that (without
prejudice to any other provision contained in any of the Security
Documents) the Security Agent (acting on the instructions of the Agent) or
any receiver or an administrator may credit any moneys received by it to a
suspense account for so long and in such manner as the Security Agent or
such receiver or such administrator may from time to time determine with a
view to preserving the rights of the Finance Parties or any of them to
prove for the whole of their respective claims against the any Borrower or
any other person liable.
17.16 PERPETUITIES
The trusts constituted or evidenced in or by the Finance Documents shall
remain in full force and effect until whichever is the earlier of:
(a) the expiration of a period of 80 years from the date of this
Agreement; and
(b) receipt by the Security Agent, at any time when it is satisfied that
all of the Charging Group are solvent, of confirmation in writing
from each of the Finance Parties that there is no longer outstanding
any Indebtedness (actual or contingent (unless such Indebtedness,
being contingent, is fully cash collateralised to the satisfaction
of the relevant Finance Party)), and no obligation on any Finance
Party to make available any Indebtedness which is secured or
guaranteed by or under any of the Security Documents or such later
date on which all of the Security Documents have been released in
accordance with their terms,
and the parties to this Agreement declare that the perpetuity period
applicable to the Security Documents shall for the purposes of the
Perpetuities and Accumulations ▇▇▇ ▇▇▇▇ be the period of 80 years from the
date of this Agreement.
17.17 POWERS AND DUTIES OF THE SECURITY AGENT AS TRUSTEE OF THE SECURITY
In its capacity as trustee in relation to the Security Documents, the
Security Agent:
(a) Powers generally: shall, without prejudice to any of the powers,
discretions and immunities conferred upon trustees by law (and to
the extent not inconsistent with the provisions of this Agreement or
any of the Security Documents), have all the same powers and
discretions as a natural person acting as the beneficial owner of
such property and/or as are conferred upon the Security Agent by
this Agreement and/or any Security Document but so that the Security
Agent may only exercise such powers and discretions to the extent
that it is authorised to do so by
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the provisions of this Agreement (including specifically, but
without limitation, clause 17.3(b)) and, in exercising such powers
and discretions, the Security Agent shall have regard to and comply
with any applicable constraints and/or restrictions imposed by this
Agreement (including specifically, but without limitation, by clause
17.3(b));
(b) Power to invest: shall (subject to clause 17.15) be entitled (in its
own name or in the names of nominees) to invest moneys from time to
time forming part of the Trust Property or otherwise held by it as a
consequence of any enforcement of the security constituted by the
Security Documents which, in the opinion of the Security Agent, it
would not be practicable to distribute immediately by placing the
same on deposit in the name or under the control of the Security
Agent as the Security Agent may think fit without being under any
duty to diversify the same and the Security Agent shall not be
responsible for any loss due to interest rate or exchange rate
fluctuations;
(c) Interpretation of provisions by Security Agent: shall have full
power to determine all questions and doubts arising in relation to
the interpretation or application of any of the provisions of this
Agreement or any of the Security Documents as it affects the
Security Agent and every such determination, in the absence of
manifest error, (whether made upon a question actually raised or
implied in the acts or proceedings of the Security Agent) shall be
conclusive and shall bind all the other parties to this Agreement
and the Security Documents;
(d) Power to engage agents: may, in the conduct of its obligations under
and in respect of the Security Documents (otherwise than in relation
to its right to make any declaration, determination or decision),
instead of acting personally, employ and pay any agent (whether
being a lawyer, chartered accountant or any other person) to
transact or concur in transacting any business and to do or concur
in doing any acts required to be done by the Security Agent
(including the receipt and payment of money) and on the basis that
(i) any such agent engaged in any profession or business shall be
entitled to be paid all usual professional and other charges for
business transacted and acts done by him or any partner or employee
of his in connection with such employment and (ii) the Security
Agent shall not be bound to supervise, or be responsible for any
loss incurred by reason of any act or omission of, any such agent if
the Security Agent shall have exercised reasonable care in the
selection of such agent (which, without limitation, shall
conclusively be deemed to be the case in respect of any agent
approved in writing by the Majority Banks); and
(e) Deposit of documents: may place all deeds, certificates and other
documents relating to the property and assets subject to the
Security Documents which are from time to time deposited with it
pursuant to the Security Documents in any safe deposit, safe or
receptacle selected by the Security Agent or with any firm of
solicitors and may make any such arrangements as it thinks fit for
allowing the Borrowers and the Charging Subsidiaries access to, or
their solicitors or auditors possession of, such
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documents when necessary or convenient and the Security Agent shall
not be responsible for any loss incurred in connection with any such
deposit, access or possession.
17.18 ALL ENFORCEMENT ACTION THROUGH THE SECURITY AGENT
None of the other Finance Parties shall have any independent power to
enforce any of the Security Documents or to exercise any rights,
discretions or powers or to grant any consents or releases under or
pursuant to any of the Security Documents or otherwise have direct
recourse to the security and/or guarantees constituted by any of the
Security Documents except through the Security Agent.
17.19 CO-OPERATION TO ACHIEVE AGREED PRIORITIES OF APPLICATION
The other Finance Parties shall co-operate with each other and with the
Security Agent and any receiver or an administrator under the Security
Documents in realising the property and assets subject to the Security
Documents and in ensuring that the net proceeds realised under the
Security Documents after deduction of the expenses of realisation are
applied in accordance with clause 17.15.
17.20 INDEMNITY FROM TRUST PROPERTY
The Security Agent and every employee, officer or agent appointed by it in
connection with its appointment under the Security Documents (each an
"INDEMNIFIED PARTY") shall be entitled to be indemnified out of the Trust
Property in respect of all liabilities, damages, costs, claims, charges or
expenses whatsoever properly incurred or suffered by an Indemnified Party:
(a) in the execution or exercise or bona fide purported execution or
exercise of the trusts, rights, powers, authorities, discretions and
duties created or conferred by or pursuant to the Security
Documents;
(b) as a result of any breach by a member of the Charging Group of any
of its obligations under any Security Document; and/or
(c) in respect of any matter or thing done or omitted in any way
relating to the Trust Property or the provisions of any of the
Security Documents.
The rights conferred by this clause 17.20 are without prejudice to any
right to indemnity by law given to trustees generally and to any provision
of the Security Documents entitling the Security Agent or any other person
to an indemnity in respect of, and/or reimbursement of, any liabilities,
damages, costs, claims, charges or expenses incurred or suffered by it in
connection with any of the Security Documents or the performance of any
duties under any of the Security Documents. Nothing contained in this
clause 17.20 shall entitle the Security Agent or any other person to be
indemnified in respect of any liabilities, damages, costs, claims, charges
or expenses to the extent that the same arise from such person's own gross
negligence or wilful misconduct.
17.21 FINANCE PARTIES TO PROVIDE INFORMATION
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The Finance Parties shall provide the Security Agent with such written
information as it may reasonably require for the purposes of carrying out
its duties and obligations under the Security Documents and, in
particular, with such necessary directions in writing so as to enable the
Security Agent to apply amounts received under, and the proceeds of
realisation of, the Security Documents on and after the Enforcement Date
as contemplated by the Security Documents.
17.22 ANCILLARY FACILITIES LIABILITIES
The other Finance Parties agree with the Ancillary Facilities Banks that
any part of the Ancillary Facilities Liabilities in respect of which
amounts are standing to the credit of any Cash Collateral Accounts in the
name of the Ancillary Facilities Banks pursuant to this Agreement and/or
any Ancillary Facilities Letter or which have otherwise been netted
against amounts standing to the credit of any accounts under the terms of
any Ancillary Facilities Letter shall rank ahead of the Indebtedness owing
under this Agreement to the extent that the Ancillary Facilities Banks are
able to apply such amounts in satisfaction of such Ancillary Facilities
Liabilities.
17.23 UNDERWRITERS AND DOCUMENTATION AGENT
The Underwriters and the Documentation Agent have no obligations of any
kind to any other party under any Finance Document and references to the
"Arrangers" in clauses 17.5 to 17.9 shall be deemed to include a reference
to the Underwriters and the Documentation Agent.
17.24 SECURITY AGENT AS JOINT CREDITOR
Each member of the Charging Group and each of the Finance Parties agrees
that the Security Agent shall be the joint creditor (together with the
relevant Finance Party) of each and every payment obligation of each
member of the Charging Group towards each of the Finance Parties under
each Finance Document and that accordingly the Security Agent will have
its own independent right to demand payment by each member of the Charging
Group in satisfaction of those obligations, provided that it is expressly
acknowledged that any discharge of its payment obligations to either of
the Security Agent or the relevant Finance Party shall to the same extent
discharge the corresponding obligations owing to the other.
17.25 SECURITY AGENT'S RIGHTS AS JOINT CREDITOR
Without limiting or affecting the Security Agent's rights against the
members of the Charging Group (whether under this clause or under any
other provision of the Finance Documents) the Security Agent agrees with
each Finance Party that it will not exercise its rights as a joint
creditor with a Finance Party under clause 17.24 except with the prior
written consent of the relevant Finance Party. However, for the avoidance
of doubt, nothing in the previous sentence shall in any way limit the
Security Agent's rights to act in the protection or preservation of rights
under or to enforce any Security Document as contemplated by the Finance
Documents. Any amount recovered by the Security Agent as a result of
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the operation of this clause shall be held for the benefit of the Finance
Parties to be applied in accordance with clause 17.15.
18 DECISIONS OF BANKS AND AGENT
18.1 OBLIGATIONS SEVERAL
The obligations of each Bank under this Agreement are several; the failure
of any Bank to perform such obligations shall not relieve any other
Finance Party or any Borrower of any of their respective obligations or
liabilities under this Agreement nor shall any Finance Party be
responsible for the obligations of any other Finance Party under this
Agreement (except to the extent that any person has obligations in
different Finance Party capacities).
18.2 INTERESTS SEVERAL
Notwithstanding any other term of this Agreement (but without prejudice to
the provisions of this Agreement relating to or requiring action by the
Majority Banks) the interests of the Finance Parties are several and the
amount due to each of the Finance Parties (in each capacity other than as
a Bank, for its own account) is a separate and independent debt. Without
prejudice to any other provision of this Agreement (including any
requirement for action to be approved or instigated by, or with the
consent or approval of, the Majority Banks and, without limitation, clause
18.4), each of the Finance Parties shall have the right to protect and
enforce its rights arising out of this Agreement and it shall not be
necessary for any other Finance Party to be joined as an additional party
in any proceedings for this purpose.
18.3 MAJORITY BANKS
(a) Where this Agreement or any of the Borrower Security Documents
provides for any matter to be determined by reference to the opinion
of the Majority Banks or to be subject to the consent or request of
the Majority Banks or for any action to be taken on the instructions
of the Majority Banks, such opinion, consent, request or
instructions shall (as between the Banks) only be regarded as having
been validly given or issued by the Majority Banks if all the (or,
as applicable, all the relevant) Banks shall have received prior
notice of the matter on which such opinion, consent, request or
instructions are required to be obtained and the relevant majority
of (relevant) Banks shall have given or issued such opinion,
consent, request or instructions, but so that (as between the
Borrowers and the Finance Parties) the Borrowers shall each be
entitled (and bound) to assume that such notice shall have been duly
received by each Bank and that the relevant majority shall have been
obtained to constitute Majority Banks whether or not this is the
case.
(b) If, within 10 Banking Days of the Agent despatching to each
(relevant) Bank a notice requesting instructions (or confirmation of
instructions) from the (relevant) Banks or the agreement of the
(relevant) Banks to any amendment, modification, waiver, variation
or excuse of performance for the purposes of, or in relation to, any
of the Finance Documents, the
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Agent has not received a reply specifically giving or confirming or
refusing to give or confirm the relevant instructions or, as the
case may be, approving or refusing to approve the proposed
amendment, modification, waiver, variation or excuse of performance,
then (irrespective of whether such (relevant) Bank responds at a
later date) the Agent shall treat any (relevant) Bank which has not
so responded as having indicated a desire to be bound by the wishes
of 66 2/3 per cent. of those (relevant) Banks (measured in terms of
the relevant Commitments of those (relevant) Banks) which have so
responded.
(c) For the purposes of this clause 18.3, any (relevant) Bank which
notifies the Agent of a wish or intention to abstain on any
particular issue shall be treated as if it had not responded.
(d) This clause 18.3 shall not apply in relation to those matters
referred to in, or the subject of, clause 17.11(b) and (c).
18.4 BANKS ACTING TOGETHER
If the Agent makes a declaration under clause 12.2 the Agent shall, in the
names of all the Banks, take such action on behalf of the Banks and
conduct such negotiations with any Borrower and any other members of the
Group and generally administer the Drawings in accordance with the wishes
of the Majority Banks. All the Banks shall be bound by the provisions of
this clause 18.4 and no Bank shall be entitled to take action
independently against any Borrower or any other member of the Group
without the consent of the Majority Banks.
19 CASH COLLATERAL ACCOUNTS
19.1 APPLICATIONS AND WITHDRAWALS
Each amount from time to time standing to the credit of a Cash Collateral
Account shall be applied in accordance with the relevant provisions of the
Finance Documents and no other withdrawals may be made from any Cash
Collateral Account without the consent of the Agent.
19.2 SECURITY OVER CASH COLLATERAL ACCOUNTS
Newco 2 shall, or shall procure that the relevant other member of the
Group shall, execute such further documents as are necessary to ensure
that each Cash Collateral Account is charged in favour of the Security
Agent to the satisfaction of the Agent.
19.3 INTEREST AND BROKEN DEPOSITS
(a) Each amount from time to time standing to the credit of a Cash
Collateral Account shall bear interest by reference to successive
deposit periods at the rate at which the Security Agent or, as the
case may be, the Cash Collateral Account Bank, the Fronting Bank or
the relevant Ancillary Facilities Bank pays interest on deposits for
such period from its corporate customers but each Borrower
acknowledges that none of the Finance Parties shall have any
responsibility to any Borrower for any
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loss occasioned as a consequence of the application of the amount
standing to the credit of any Cash Collateral Account prior to the
last day of any such deposit period, such application being
expressly permitted by the terms of the Finance Documents.
(b) In respect of each Cash Collateral Account, provided no Default
shall have occurred and be continuing, the Security Agent or, as the
case may be, the Cash Collateral Account Bank, the Fronting Bank or
the relevant Ancillary Facilities Bank shall, at the request of
Newco 2, pay to the relevant Borrower any interest that has accrued
on the amount standing to the credit of such Cash Collateral
Account. Such interest shall be paid at six-monthly intervals or on
such days that the principal amount standing to the credit of such
Cash Collateral Account is reduced to zero pursuant to the terms of
this Agreement.
19.4 APPLICATION OF SURPLUS CASH COLLATERAL FOLLOWING ENFORCEMENT DATE
If at any time following the Enforcement Date any Contingent Ancillary
Facilities Liabilities or Letters of Credit in respect of which an amount
was paid to a Cash Collateral Account pursuant to clauses 6.5, 12.2(c) or
12.3 (or otherwise pursuant to this Agreement) are finally discharged
without the relevant Ancillary Facilities Bank or Fronting Bank actually
incurring liabilities to the extent of such cash collateral (the amount by
which the amount of such cash collateral exceeds cash collateralised
Contingent Ancillary Facilities Liabilities or, as the case may be, cash
collateralised Letters of Credit being referred to in this clause 19.4 as
the "RELEVANT EXCESS"), such Ancillary Facilities Bank or Fronting Bank
will forthwith pay to the Security Agent an amount equal to the relevant
excess and such payment shall be treated by the Security Agent as if it
were a recovery made under the Security Documents and distributed
accordingly.
20 MATTERS CONCERNING THE BORROWERS
20.1 ADDITIONAL BORROWERS: UK RESIDENT SUBSIDIARY
Newco 2 may, at any time after the Effective Date (unless a Default shall
have occurred and be continuing), and provided that no more than eight
Working Capital Borrowers may draw Working Capital Advances or have
Letters of Credit issued on their behalf and there may not be more than
eight Ancillary Facilities Borrowers which are not UK resident
Subsidiaries at any time, notify the Agent that it wishes, any UK resident
Subsidiary which is a Charging Subsidiary to be designated as an
additional Borrower under the Working Capital Facility and/or the
Ancillary Facilities.
20.2 ADDITIONAL BORROWERS: NON-UK RESIDENT SUBSIDIARY
Newco 2 may, at any time after the Effective Date (unless a Default shall
have occurred and be continuing), and provided that no more than eight
Working Capital Borrowers may draw Working Capital Advances or have
Letters of Credit issued on their behalf and there may not be more than
eight Ancillary Facilities Borrowers which are not UK resident
Subsidiaries at any time, notify
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the Agent that it wishes, with the prior consent of the Majority Banks,
any company which, at the time of such notification and at all times
thereafter up to and including the date on which it enters into the
Accession Certificate in accordance with clause 20.3(b), is a Qualifying
Non-UK resident Subsidiary which is a Charging Subsidiary to be designated
as an additional Borrower under the Working Capital Facility and/or the
Ancillary Facilities.
20.3 NOTICE
Such notice as shall be required to be given under clauses 20.1 and 20.2
shall be in writing and signed on behalf of Newco 2 (for itself and all
the other Borrowers) and on behalf of the proposed new Borrower and shall
(in the case of a notice given under clause 20.2) be accompanied by a
legal opinion addressed to the Agent (in form and substance satisfactory
to the Agent (acting reasonably)) confirming that, at the date of that
opinion letter (which shall be dated not more than one Banking Day before
the date of the notice) such proposed new Borrower is a Qualifying Non-UK
resident Subsidiary, and shall take effect in accordance with its terms on
the conditions that:
(a) the additional Borrower shall have entered into an Accession
Certificate with the Agent which, provided in the case of a notice
under clause 20.2 that the Majority Banks consent to the proposed
accession of the new Borrower, the Agent shall execute on behalf of
all the parties to this Agreement (and all such parties so authorise
the Agent); and
(b) the additional Borrower, before entering into such an Accession
Certificate, shall have fulfilled all appropriate conditions
precedent, as notified to Newco 2 by the Agent, to the satisfaction
of the Agent (acting reasonably) including, without limitation, the
delivery to the Agent of a certificate substantially in the form of
annexure A to schedule 4 of the Supplemental Agreement (but with the
references to the Supplemental Agreement replaced with references to
this Agreement) with appropriate amendments (if any) to reflect its
jurisdiction of incorporation, together with all documents referred
to therein.
Upon satisfaction of such conditions the Acceding Borrower (as defined in
the relevant Accession Certificate) shall become a party to this Agreement
in the capacity of the relevant Borrower and shall assume all the
obligations and rights of such a Borrower under this Agreement.
20.4 CESSATION
If:
(a) for any reason whatsoever, a Borrower ceases to be a wholly-owned
Subsidiary of Newco 2; or
(b) at any time after the date on which a Borrower enters into an
Accession Certificate in accordance with clause 20.3(b), that
Borrower ceases, for whatever reason (including by reason of another
person becoming a Finance Party), to be a Qualifying Non-UK resident
Subsidiary,
139
then such Borrower shall cease to be entitled to utilise the Working
Capital Facility and the Ancillary Facilities and, without prejudice to
any existing liabilities as such, shall cease to be a Borrower.
20.5 INDEMNITY
The Borrowers shall indemnify and keep indemnified each Finance Party for
all reasonable costs (including the costs of completing forms for
submission to the relevant Taxation authorities) which may be incurred by
that Finance Party in order that the Qualifying Non-UK resident Subsidiary
may make payments under this Agreement or any of the Borrower Security
Documents for the account of that Finance Party without deduction or
withholding in respect of Taxes other than any such cost or loss caused by
or arising from the gross negligence or wilful default of such Finance
Party.
20.6 NEWCO 2 AS BORROWERS' AGENT
Each Borrower by its execution of this Agreement or an Accession
Certificate, as the case may be, irrevocably appoints and authorises Newco
2:
(a) as agent for such Borrower to receive all notices, requests, demands
or other communications under this Agreement and the Ancillary
Facilities Letters which shall, without prejudice to any other
effective mode of serving the same, be properly served on the
Borrower concerned if served on Newco 2 in accordance with clause
21.1; and
(b) to give all notices and instructions and make such agreements
(including, without limitation, any Accession Certificate) expressed
to be capable of being given or made by such Borrower or the
Borrowers in this Agreement or the Ancillary Facilities Letters
notwithstanding that they may affect such Borrower without further
reference to, or the consent of, such Borrower and such Borrower
shall, as regards the Finance Parties, be bound thereby as though
such Borrower itself had given such notice or instructions or made
such agreement.
20.7 AMENDMENTS BINDING
Without prejudice to the other provisions of this Agreement each Borrower
hereby confirms that if Newco 2 and the Finance Parties or any of them
enter into any amendment or supplement to or restatement of this
Agreement, Newco 2's execution of any such amendment or supplement or
restatement, whether or not expressly made or purportedly made on behalf
of such Borrower, shall (to the extent legally possible) bind such
Borrower without the need to obtain any confirmation or acknowledgement
from such Borrower. For this purpose, each Borrower, for the benefit of
the Finance Parties, irrevocably designates, appoints and empowers Newco 2
as its agent and attorney.
20.8 OBLIGATIONS UNCONDITIONAL
The obligations of each Borrower under this Agreement, the Ancillary
Facilities Letter and the Borrower Security Documents are unconditional
and irrevocable
140
(subject to the express provisions of this Agreement or any Borrower
Security Document) and shall not be in any way affected or discharged by
reason of any matter affecting the Transaction Documents including,
without limitation, any breach or alleged breach of the same or any claim
that any Borrower or any other member of the Group has, or considers that
it has, against any other party to the Transaction Documents. Each
Borrower acknowledges that any authorisation given under this Agreement,
any Ancillary Facilities Letter or any Borrower Security Document by a
Finance Party in relation to the Transaction Documents shall not
constitute any representation or warranty by such (or any) Finance Party
as to the adequacy or effectiveness of such documents, the purchase
consideration payable by Newco 2, the commercial advisability of any
Borrower entering into the arrangements contemplated thereby or otherwise.
20.9 OBLIGATIONS SEVERAL
Without prejudice to the terms of this Agreement, the Ancillary Facilities
Letters or the Borrower Security Documents the obligations of each
Borrower under this Agreement, the Ancillary Facilities Letters and the
Borrower Security Documents are several and the failure of Newco 2 or any
other Borrower to perform such obligations shall not release any of the
other Borrowers or Newco 2 (as applicable) from its obligations under this
Agreement, any Ancillary Facilities Letter or any Borrower Security
Document.
21 NOTICES AND OTHER MATTERS
21.1 ADDRESS FOR NOTICE
Every notice, request, demand or other communication under this Agreement
shall:
(a) be in writing delivered personally or by first-class prepaid letter
(airmail if available) or telefax;
(b) be deemed to have been received, subject as otherwise provided in
this Agreement, in the case of a letter, when delivered personally
or 3 days after it has been put into the post and, in the case of a
telefax, when a complete and legible copy is received by the
addressee (unless the time of despatch of any telefax is after close
of business in which case it shall be deemed to have been received
at the opening of business on the next business day); and
(c) be sent:
(A) to Newco 2 at:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Telefax: (▇)▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and Finance Director
141
with a copy to:
Hicks, Muse, ▇▇▇▇ & ▇▇▇▇▇ Limited
Queensberry House
▇-▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Telefax: 020 7494 8383
Attention: ▇▇▇▇▇▇ ▇▇▇
(B) to the Agent and the Security Agent at:
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇ ▇▇▇
Telefax: 020 7777 2360
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Agency Loans Department
(C) to ▇.▇. ▇▇▇▇▇▇ plc as an Arranger at:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Telefax: 020 7777 4788
Attention: ▇▇▇▇ ▇▇▇▇▇▇
(D) to Barclays Capital as Arranger at:
5 ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Telefax: 020 7773 6808
Attention: ▇▇▇▇ ▇▇▇▇▇▇
(E) JPMorgan Chase Bank as an Underwriter, Ancillary Facilities
Bank and a Bank at:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Telefax: 020 7777 4757
Attention: ▇▇▇ ▇▇▇▇▇
(F) to Barclays Bank PLC as an Underwriter at
142
5 ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Telefax: 0207 773 6808
Attention: ▇▇▇▇ ▇▇▇▇▇▇
(G) to each Bank at its address or telefax number specified in
schedule 1 or in any relevant Substitution Certificate,
or to such other address or telefax number as is notified by
Newco 2 or a Finance Party, as the case may be, to the Agent
and the Agent shall promptly notify the other parties hereto
of any such change.
21.2 NOTICE TO AGENT
Every notice, request, demand or other communication under this Agreement
to be given by a Borrower shall be given by Newco 2 and by Newco 2 to any
other party shall be given to the Agent for onward transmission as
appropriate and to be given to a Borrower shall (except as otherwise
provided in this Agreement) be given by the Agent to Newco 2.
21.3 NO IMPLIED WAIVER, REMEDIES CUMULATIVE
No failure or delay on the part of the Finance Parties or any of them to
exercise any power, right or remedy under this Agreement or any Borrower
Security Document shall operate as a waiver thereof, nor shall any single
or partial exercise by the Finance Parties or any of them of any power,
right or remedy preclude any other or further exercise thereof or the
exercise of any other power, right or remedy. The remedies provided in
this Agreement and each of the Borrower Security Documents are cumulative
and are not exclusive of any remedies provided by law.
21.4 COUNTERPARTS
This Agreement may be executed in any number of counterparts and by the
different parties on separate counterparts, each of which when so executed
and delivered shall be an original, but all counterparts shall together
constitute one and the same instrument.
21.5 CONFLICTS
(a) The Borrowers acknowledge that ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇ Bank, Bankers Trust
Company (or its successor), Citibank N.A. and Barclays Bank PLC and
their respective parent undertakings, subsidiary undertakings and
fellow subsidiary undertakings (together the "ARRANGER GROUP") may
be providing debt finance, equity capital or other services
(including financial advisory services) to other persons with which
the Borrowers may have conflicting interests in respect of the
Facilities or otherwise.
143
(b) No member of the Arranger Group shall use confidential information
from the Borrowers by virtue of the Facilities or its relationships
with the Borrowers in connection with their performance of services
for other persons. This shall not, however, affect any obligations
that any member of the Arranger Group has as Agent in respect of the
Finance Documents. The Borrowers also acknowledge that no member of
the Arranger Group has any obligation to use or furnish to the
Borrowers information obtained from other persons for their benefit.
(c) The terms "PARENT UNDERTAKING", "SUBSIDIARY UNDERTAKING" and "FELLOW
UNDERTAKING" when used in this clause have the meaning given to them
in sections 258 and 259 of the Act.
21.6 COMMUNICATIONS INDEMNITY
The Borrowers shall indemnify each Finance Party against any cost, claim,
loss, expense (including legal fees) or liability together with any VAT
thereon which any of the Finance Parties may sustain or incur as a
consequence of any telefax communication purporting to originate from a
member of the Group to the Agent or the Security Agent being made or
delivered fraudulently (unless such cost, claim, loss, expense or
liability is caused by the gross negligence or wilful misconduct of such
Finance Party). For avoidance of doubt, a Borrower shall only be liable
under this indemnity in respect of telefax communications originating or
purportedly originating from a member of the Group. Neither the Agent nor
the Security Agent shall be liable for any damages arising from the use by
unauthorised persons of information or other materials sent through
electronic, telecommunications or other information transmission systems
that are intercepted by such persons or for any special, indirect,
consequential or punitive damages in connection with the Working Capital
Facility.
21.7 NOTICE OF THE END OF THE FINANCE PERIOD
Upon each of the Finance Parties and each of the members of the Group
ceasing to have any actual or contingent liabilities or obligations under
any of the Finance Documents, the Agent shall promptly notify Newco 2 that
the end of the Finance Period has occurred.
21.8 THIRD PARTY RIGHTS
No term of this Agreement, other than clauses 13.3 and 17.20 is
enforceable by a person who is not a party to this Agreement. Each person
referred to in clauses 13.3 and 17.20 which is not a party to this
Agreement (a "RELEVANT THIRD PARTY") shall have the right to enforce its
respective rights against the parties to this Agreement under such clauses
provided that the Senior Finance Party to which such Relevant Third Party
is or was connected may, by agreement with Newco 2, vary the rights
conferred on such Relevant Third Party by such clauses (without the
consent of any Relevant Third Party and shall not be liable to any
Relevant Third Party for any of its acts or omissions under this clause
21.8).
144
22 GOVERNING LAW AND JURISDICTION
22.1 LAW
This Agreement shall be governed by and construed in accordance with
English law.
22.2 SUBMISSION TO JURISDICTION
The parties to this Agreement agree for the benefit of the Finance Parties
that:
(a) if any party has any claim against any other party arising out of or
in connection with this Agreement such claim shall (subject to
clause 22.2(c)) be referred to the High Court of Justice in England,
to the jurisdiction of which each of the parties irrevocably
submits;
(b) the jurisdiction of the High Court of Justice in England over any
such claim against any Finance Party shall be an exclusive
jurisdiction and no courts outside England shall have jurisdiction
to hear or determine any such claim;
(c) nothing in this clause 22.2 shall limit the right of any Finance
Party to refer any such claim against any Borrower to any other
court of competent jurisdiction outside England, to the jurisdiction
of which each Borrower hereby irrevocably agrees to submit, nor
shall the taking of proceedings by any Finance Party before the
courts in one or more jurisdictions preclude the taking of
proceedings in any other jurisdiction whether concurrently or not;
and
(d) the Borrowers irrevocably waive any objection to proceedings in the
court mentioned in this clause and any claim on the grounds of forum
non conveniens.
22.3 AGENT FOR SERVICE OF PROCESS
Each Borrower irrevocably designates, appoints and empowers Newco 2 to
receive for it and on its behalf service of process issued out of the High
Court of Justice in England in relation to any claim arising out of or in
connection with this Agreement. Newco 2 accepts such appointment.
IN WITNESS whereof the parties to this Agreement have caused this Agreement to
be duly executed on the date first above written.
145
SCHEDULE 1
THE BANKS AND THEIR COMMITMENTS
FACILITY A FACILITY A TRANCHE FACILITY B FACILITY B TRANCHE WORKING CAPITAL
TRANCHE 1 2 TRANCHE 1 2 FACILITY
BANK (pound) (pound) (pound) (pound) (pound)
----------------------- ---------- ------------------ ---------- ------------------ ---------------
ABBEY NATIONAL TREASURY 4,332,930 - 1,996,479 - 3,571,429
SERVICES
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
BANCO ESPIRITO SANTO 1,444,310 - 665,493 - 1,190,476
S.A.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
BANK OF IRELAND 2,166,465 - 998,239 - 1,785,714
INTERNATIONAL
FINANCE LIMITED
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇
BANK OF SCOTLAND 5,777,240 - 2,661,972 - 4,761,905
▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
BARCLAYS BANK PLC 3,466,344 41,000,000 2,630,654 4,025,517.33 8,000,000
Global Services ▇▇▇▇
▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇ ▇▇▇
BAYERISCHE HYPO-UND 2,888,620 - 1,330,986 - 2,380,952
VEREINSBANK AG
▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
146
BNP PARIBAS 5,777,240 - 2,661,972 - 4,761,905
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇ ▇▇▇
CITIBANK N.A. 7,153,007 - - - 8,085,714
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
DEUTSCHE BANK AG 14,476,151 - - - 12,004,762
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
DUCHESS I CDO S.A. - - 5,408,664 - -
7th Floor
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
DUKE STREET - - 6,988,200 - -
CAPITAL DEBT
MANAGEMENT
LIMITED
▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
GMAC COMMERCIAL CREDIT 17,704,119 - - - -
LIMITED
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
HARBOURMASTER LOAN - - 1,077,035 - -
147
CORPORATION B.V.
▇/▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ AZ
Amsterdam, ▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
INTERCONTINENTAL CDO 3,000,000 - - - -
S.A.
C/O Pacific Investment
Management CO.
LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇ ▇▇▇▇▇
INTESA BCI SpA 7,221,550 - 3,327,464 - 5,952,381
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
JPMORGAN CHASE BANK 2,138,014 82,000,000 - 8,051,034.67 12,933,333
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
KBC BANK N.V. 2,888,620 - 1,330,986 - 2,380,952
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
LEVERAGED FINANCE - - 4,991,571 - -
EUROPE CAPITAL I BV
1076 AZ
Amsterdam
The Netherlands
148
LLOYDS TSB BANK PLC 4,332,930 - 1,996,479 - 9,571,429
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
METROPOLITAN LIFE - - 3,295,882 - -
INSURANCE COMPANY
▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
U.S.A.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 2,888,620 - 1,330,986 - 2,380,952
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇ ▇▇▇
NATWEST GLOBAL 5,777,240 - 2,661,972 - 4,761,905
FINANCIAL MARKETS
Commercial Loans Dept.
Kings Cross House,
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇ BANK SpA 5,777,240 - 2,661,972 - 4,761,905
▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
SCOTIABANK EUROPE PLC 4,332,930 - 1,996,479 - 3,571,429
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
149
SINGER AND ▇▇▇▇▇▇▇▇▇▇▇ 6,444,310 - 665,493 - 1,190,476
LIMITED
▇▇ ▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
SUMITOMO TRUST AND 4,112,612 - 1,894,963 - -
BANKING CO. LTD
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
THE MITSUBISHI TRUST 4,332,930 - 1,996,479 - 3,571,429
AND BANKING CORP.
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
THE UNITED BANK OF 2,888,620 - 1,330,986 - 2,380,952
KUWAIT LTD
▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇ ▇▇▇
----------- ----------- ---------- ---------- -----------
Total 121,322,042 123,000,000 55,901,406 12,076,552 100,000,000
=========== =========== ========== ========== ===========
150
SCHEDULE 2
FORMS OF DRAWDOWN (AND OTHER) NOTICES
PART A - FACILITY A AND FACILITY B
To: ▇.▇. ▇▇▇▇▇▇ Europe Limited
Trinity Tower,
9 ▇▇▇▇▇▇ ▇▇▇▇ Street [DATE]
▇▇▇▇▇▇
▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Agency Loans Department
Dear Sirs,
SECURED CREDIT FACILITIES
AGREEMENT DATED 10 AUGUST 1999 AND AMENDED AND RESTATED ON [_] 2002 (THE
"AGREEMENT")
We refer to the Agreement and hereby give you notice that we wish to draw a
Facility [A] [B] Advance under the Facility [_] Tranche 2 in the sum of
[(pound)_] on o 2002 with payment to be made in accordance with our irrevocable
instructions to you contained in clause [4.1(a)(iii)] [4.1(b)(iii)] of the
Agreement to the person(s) named below. [We select a first Interest Period in
respect thereof of ______________ months.] [The first Interest Period in respect
thereof to expire on _____________________________ 2002]
[We confirm that the entire Facility A Advance will be used for the purposes
described in clause 2.1(a)(ii) of the Agreement.]
[We confirm that the entire Facility B Advance will be used for the purposes
described in clause 2.1(b)(ii) of the Agreement.]
We confirm that:
(i) no event or circumstance has occurred and is continuing which constitutes
a Default; and
(ii) the representations and warranties contained in clause 9.1 of the
Agreement which are repeated in accordance with clause 9.3 of the
Agreement are true and correct in all material respects at the date hereof
as if made with respect to the facts and circumstances existing at such
date.
Words and expressions defined in the Agreement shall have the same meanings
where used herein.
For and on behalf of
PREMIER FINANCING LIMITED
_____________________
Director
151
PART B - THE WORKING CAPITAL FACILITY
To: ▇.▇. ▇▇▇▇▇▇ Europe Limited
Trinity Tower,
9 ▇▇▇▇▇▇ ▇▇▇▇ Street [DATE]
▇▇▇▇▇▇
▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Agency Loans Department
Dear Sirs,
SECURED CREDIT FACILITIES
AGREEMENT DATED 10 AUGUST 1999 AND AMENDED AND RESTATED ON [_] 2002 (THE
"AGREEMENT")
We refer to the above Agreement and hereby give you notice that [we wish] [name
of Working Capital Borrower] wishes] to draw a [Working Capital Advance] [Letter
of Credit] of [(pound)]_ [in [currency]] on _ [and select a Maturity Period in
respect thereof of _ months. The funds should be credited to [name and number of
account] with [details of bank.]]
[Insert letter of credit details, if relevant - see requirements of clause 4.9]
We confirm that:
(i) no event or circumstance has occurred and is continuing which constitutes
a Default; and
(ii) the representations and warranties contained in clause 9.1 of the
Agreement which are repeated in accordance with clause 9.3 of the
Agreement are true and correct in all material respects at the date hereof
as if made with respect to the facts and circumstances existing at such
date.
Words and expressions defined in the Agreement shall have the same meanings
where used herein.
For and on behalf of
[name of Working Capital Borrower]
______________________________
Director
152
SCHEDULE 3
DOCUMENTS AND EVIDENCE REQUIRED AS CONDITIONS PRECEDENT TO THE IRISH SECOND
ACQUISITION
1 CORPORATE
1.1 A certificate from the UK Second Purchaser (as the direct holding company
of the Irish Second Purchaser) in the form of annexure A to schedule 4 to
the Supplemental Agreement (but with the references to the Supplemental
Agreement replaced with references to this Agreement), together with all
the documents referred to therein.
1.2 A certificate from the Irish Second Purchaser substantially in the form of
annexure A to schedule 4 to the Supplemental Agreement (but with the
references to the Supplemental Agreement replaced with references to this
Agreement and with appropriate amendments taking into account that it is
incorporated in the Republic of Ireland), together with all the documents
referred to therein.
2 SECOND TRANSACTION DOCUMENTS
Evidence that the Second Transaction Documents have become in all respects
unconditional in respect of the Irish Second Acquisition.
3 SECURITY DOCUMENTS
3.1 An Irish law debenture duly executed by the Irish Second Purchaser and the
UK Second Purchaser (the direct holding company of the Irish Second
Purchaser) in respect of its Irish assets, including, without limitation,
all of the shares in the Irish Second Purchaser).
3.2 Any other documents or evidence required in order to ensure that the
debenture referred to in paragraph 3.1 creates first ranking fixed
security over the Irish assets of the Irish Second Purchaser and the UK
Second Purchaser.
4 OPINIONS
4.1 An opinion of ▇▇▇▇▇▇ ▇▇▇▇ dated not more than 5 Banking Days prior to the
date of the debenture referred to in paragraph 3.1.
4.2 A legal opinion from Irish legal advisers to the Agent, the Banks and the
Security Agent.
5 MISCELLANEOUS
5.1 Evidence that all governmental and third party approvals necessary in
connection with the Irish Second Acquisition and the continued operating
of the Group shall have been obtained, together with a clearance from the
Irish Minister for Enterprise, Trade and Employment in respect of the
Irish Second Acquisition in form and substance satisfactory to the Agent
and the Amendment Underwriters (acting reasonably) and evidence that (i)
all other relevant competition authorities have decided not to initiate
proceedings in respect of the
153
Irish Second Acquisition or (ii) the time limit for them to do so has
expired without a decision to initiate such proceedings or (iii) there are
no grounds on which such proceedings may be brought .
5.2 A certificate from an authorised officer of Newco 2 confirming that no
Default has occurred which is continuing.
5.3 A deed of release or other evidence satisfactory to the Agent that the
assets and business to be acquired by the Irish Second Purchaser on the
Irish Second Acquisition Completion Date will be so acquired free from any
Encumbrances.
5.4 A certificate from an authorised officer of Newco 2 confirming that the
arrangements for the Irish Second Acquisition are in compliance with all
applicable laws in all material respects and that no provision of any
Second Transaction Document has been amended, extended, supplemented,
waived or otherwise modified in a manner which might reasonably be
expected materially and adversely to affect the interests of the Finance
Parties under the Finance Documents.
154
SCHEDULE 4
CALCULATION OF ADDITIONAL COST
1 The Additional Cost is an addition to the interest rate to compensate
Banks for the cost of compliance with (a) the requirements of the Bank of
England and/or the Financial Services Authority (or, in either case, any
other authority which replaces all or any of its functions) or (b) the
requirements of the European Central Bank.
2 On the first day of each Interest Period or, as applicable, Maturity
Period commencing on or after the Second Effective Date (or as soon as
possible thereafter) the Agent shall calculate, as a percentage rate, a
rate (the "ADDITIONAL COST RATE") for each Bank, in accordance with the
paragraphs set out below. The Additional Cost will be calculated by the
Agent as a weighted average of the Banks' Additional Cost Rates (weighted
in proportion to the percentage participation of each Bank in the relevant
Advance) and will be expressed as a percentage rate per annum.
3 The Additional Cost Rate for any Bank lending through a lending office in
a Participating Member State will be the percentage notified by that Bank
to the Agent. This percentage will be certified by that Bank in its notice
to the Agent to be its reasonable determination of the cost (expressed as
a percentage of that Bank's participation in all Advances made from that
lending office) of complying with the minimum reserve requirements of the
European Central Bank in respect of Advances made from that lending
office.
4 The Additional Cost Rate for any Bank lending from a lending office in the
United Kingdom will be calculated by the Agent as follows:
(a) in relation to an Advance in Sterling:
AB + C(B-D) + E X 0.01 per cent. per annum
-------------------------
100-(A + C)
(b) in relation to an Advance in any currency other than Sterling:
E X 0.01 per cent. per annum.
-----------
300
Where:
A is the percentage of Eligible Liabilities (assuming these to be in
excess of any stated minimum) which that Bank is from time to time
required to maintain as an interest free cash ratio deposit with the
Bank of England to comply with cash ratio requirements.
B is the percentage rate of interest (excluding the Margin and the
Additional Cost and, if the Advance is due and payable but unpaid,
the additional rate of interest specified in clause 5.3) payable for
the relevant Interest Period or, as applicable, Maturity Period for
the Advance.
155
C is the percentage (if any) of Eligible Liabilities which that Bank
is required from time to time to maintain as interest bearing
Special Deposits with the Bank of England.
D is the percentage rate per annum payable by the Bank of England to
the Agent on interest bearing Special Deposits.
E is designed to compensate Banks for amounts payable under the Fees
Rules and is calculated by the Agent as being the average of the
most recent rates of charge supplied by the LIBOR Reference Banks to
the Agent pursuant to paragraph 7 below and expressed in pounds per
(pound)1,000,000.
5 For the purposes of this schedule 4:
(a) "ELIGIBLE LIABILITIES" and "SPECIAL DEPOSITS" have the meanings
given to them from time to time under or pursuant to the Bank of
England Act 1998 or (as may be appropriate) by the Bank of England;
(b) "FEES RULES" means the rules on periodic fees contained in the FSA
Supervision Manual or such other law or regulation as may be in
force from time to time in respect of the payment of fees for the
acceptance of deposits;
(c) "FEE TARIFFS" means the fee tariffs specified in the Fees Rules
under the activity group A.1 Deposit acceptors (ignoring any minimum
fee or zero rated fee required pursuant to the Fees Rules but taking
into account any applicable discount rate); and
(d) "TARIFF BASE" has the meaning given to it in, and will be calculated
in accordance with, the Fees Rules.
6 In applying the above formulae, A, B, C and D will be included in the
formulae as percentages (i.e. 5 per cent. will be included in the formula
as 5 and not as 0.05). A negative result obtained by subtracting D from B
shall be taken as zero. The resulting figures shall be rounded to four
decimal places.
7 If requested by the Agent, each LIBOR Reference Bank shall, as soon as
practicable after publication by the Financial Services Authority, supply
to the Agent the rate of charge payable by that LIBOR Reference Bank to
the Financial Services Authority pursuant to the Fees Rules in respect of
the relevant financial year of the Financial Services Authority
(calculated for this purpose by that LIBOR Reference Bank as being the
average of the Fee Tariffs applicable to that LIBOR Reference Bank for
that financial year) and expressed in pounds per (pound)1,000,000 of the
Tariff Base of that LIBOR Reference Bank.
8 Each Bank shall supply any information required by the Agent for the
purpose of calculating its Additional Cost Rate. In particular, but
without limitation, each Bank shall supply the following information on or
prior to the date on which it becomes a Bank:
156
(a) the jurisdiction of its lending office; and
(b) any other information that the Agent may reasonably require for such
purpose.
Each Bank shall promptly notify the Agent of any change to the information
provided by it pursuant to this paragraph.
9 The percentages of each Bank for the purpose of A and C above and the
rates of charge of each LIBOR Reference Bank for the purpose of E above
shall be determined by the Agent based upon the information supplied to it
pursuant to paragraphs 7 and 8 above and on the assumption that, unless a
Bank notifies the Agent to the contrary, each Bank's obligations in
relation to cash ratio deposits and Special Deposits are the same as those
of a typical bank from its jurisdiction of incorporation with a lending
office in the same jurisdiction as its lending office.
10 The Agent shall have no liability to any person if such determination
results in an Additional Cost Rate which over or under compensates any
Bank and shall be entitled to assume that the information provided by any
Bank or LIBOR Reference Bank pursuant to paragraphs 3, 7 and 8 above is
true and correct in all respects.
11 The Agent shall distribute the additional amounts received as a result of
the Additional Cost to the Banks on the basis of the Additional Cost Rate
for each Bank based on the information provided by each Bank and each
LIBOR Reference Bank pursuant to paragraphs 3, 7 and 8 above.
12 Any determination by the Agent pursuant to this schedule 4 in relation to
a formula, the Additional Cost, an Additional Cost Rate or any amount
payable to a Bank shall, in the absence of manifest error, be conclusive
and binding on all the parties to this Agreement.
13 The Agent may from time to time, after consultation with Newco 2 and the
Banks, determine and notify all the Banks and Newco 2 of any amendments
which are required to be made to this schedule 4 in order to comply with
any change in law, regulation or any requirements from time to time
imposed by the Bank of England, the Financial Services Authority or the
European Central Bank (or, in any case, any other authority which replaces
all or any of its functions) and any such determination shall, in the
absence of manifest error, be conclusive and binding on all the parties to
this Agreement.
14 The Borrowers' obligations to pay the amounts in respect of the Additional
Cost notified to Newco 2 prior to the Second Effective Date shall continue
in full force and effect, notwithstanding the amendments to this schedule
4 on that date.
157
SCHEDULE 5
FORM OF SUBSTITUTION CERTIFICATE
PART A (SINGLE TRANSFERS)
NB 1. Banks are advised not to employ Substitution Certificates or
otherwise to assign, novate or transfer interests in the Agreement
without first ensuring that the transaction complies with all
applicable laws and regulations, including the Financial Services
▇▇▇ ▇▇▇▇ and regulations made thereunder.
2. It is expected that Banks will enter into separate arrangements
dealing with the monies to be paid to the Existing Bank by the
Substitute in consideration of the novation (e.g. principal, accrued
interest, fees and any mismatched funding adjustment). Unless the
Transfer Effective Date is a rollover date, mismatches of parties'
funding may arise. This Certificate does not deal with these issues,
nor does it deal with any interim risk participation the Existing
Bank may grant to the Substitute pending the Transfer Effective
Date.
To: ▇.▇. ▇▇▇▇▇▇ Europe Limited on its own behalf, as agent for the Banks and
on behalf of the Arrangers, the Security Agent, the Underwriters, the
Documentation Agent, the Ancillary Facilities Banks, each Borrower and
each other party to the Agreement mentioned below and the Intercreditor
Agreement.
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Agency Loans Department [DATE]
SUBSTITUTION CERTIFICATE
This Substitution Certificate relates to a Secured Credit Facilities Agreement
(the "Agreement") dated 10 August 1999 and amended and restated on [_] 2002
between, among others, the Borrowers party thereto, ▇.▇. ▇▇▇▇▇▇ plc and Barclays
Capital as Amendment Arrangers, ▇.▇. ▇▇▇▇▇▇ Europe Limited as Agent and Security
Agent, the persons whose respective names and addresses are set out in schedule
1 thereto as Banks. Terms defined in the Agreement shall have the same meaning
in this Substitution Certificate.
1 [Existing Bank] (the "Existing Bank") (a) confirms the accuracy of the
summary of its participation in the Agreement set out in the schedule
below; and (b) requests [Substitute Bank] (the "Substitute") to accept by
way of novation the portion of such participation specified in the
schedule hereto by counter-signing and delivering this Substitution
Certificate to the Agent at its address for the service of notices
specified in the Agreement.
2 The Substitute hereby requests the Agent (on behalf of itself, the other
Finance Parties, all Borrowers and all other parties to the Agreement) to
accept this Substitution Certificate as being delivered to the Agent
pursuant to and for the purposes of clause 16.3 of the Agreement and
clause 20.4 of the Intercreditor Agreement so as to take effect in
accordance with the terms thereof on [date of transfer] (the "TRANSFER
EFFECTIVE DATE") or on such later date as may be determined in accordance
with the terms thereof.
158
3 The Agent (on behalf of itself, the other Finance Parties, the Borrowers
and all other parties to the Agreement) confirms the novation effected by
this Substitution Certificate pursuant to and for the purposes of clause
16.3 of the Agreement and clause 20.4 of the Intercreditor Agreement so as
to take effect in accordance with the terms thereof.
4 The Substitute confirms:
(a) that it has received copies of the Finance Documents and all other
documentation and information required by it in connection with the
transactions contemplated by this Substitution Certificate;
(b) that it has not relied upon any statement, opinion, forecast or
other representation or warranty made by the Existing Bank, the
Arrangers, the Underwriters, the Documentation Agent, the Security
Agent or the Agent to induce it to enter into this Substitution
Certificate;
(c) that it has made and will continue to make, without reliance on the
Existing Bank or any other Finance Party, and based on such
documents as it considers appropriate, its own appraisal of the
creditworthiness of each Borrower and the Group and its own
independent investigation of the financial condition, prospects and
affairs of the Acquisition Parties, each Borrower and the Group in
connection with the making and continuation of the Facilities under
the Agreement and the other Finance Documents;
(d) that neither the Existing Bank nor any other Finance Party shall at
any time be deemed to have had or have a duty or responsibility,
either historically, initially or on a continuing basis, to provide
the Substitute with any credit or other information with respect to
any Borrower or any other member of the Group or the Acquisition
Parties, whether coming into its possession before the making of any
Drawing or at any time or times thereafter, other than (in the case
of the Agent) as provided in clauses 17.3(a) and 17.5(a) of the
Agreement;
(e) that it has made and will continue to make its own assessment of the
legality, validity, enforceability and sufficiency of the Agreement,
the Security Documents, each other Finance Document and this
Substitution Certificate and has not relied and will not rely on the
Existing Bank, the Arranger, the Security Agent or the Agent or any
statements made by any of them in that respect;
(f) that, accordingly, none of the Existing Bank, the Arrangers, the
Underwriters, the Security Agent and the Agent shall make any
representations or warranties in respect of, or shall have any
liability or responsibility to the Substitute in respect of, any of
the foregoing matters or any other matter referred to in clause 17.7
of the Agreement;
(g) that it is [not] a Qualifying Bank; and
(h) that it has signed an appropriate confidentiality undertaking issued
by the Existing Bank.
159
5 Execution of this Substitution Certificate by the Substitute constitutes
its representation to the Existing Bank and all other parties to the
Agreement and the Intercreditor Agreement that it has power to become
party to the Agreement and the Intercreditor Agreement as a Bank or, as
applicable, a Senior Bank on the terms herein and therein set out and has
taken all necessary steps to authorise execution and delivery of this
Substitution Certificate.
6 The Substitute hereby undertakes to the Existing Bank, the Finance
Parties, the Borrowers and each of the other parties to the Agreement and
the Intercreditor Agreement that it will perform in accordance with their
respective terms all those obligations which by the terms of the Agreement
and the Intercreditor Agreement will be assumed by it after acceptance of
this Substitution Certificate by the Agent.
7 Without limiting the above paragraphs, nothing in this Substitution
Certificate obliges the Existing Bank to:
(a) accept any re-transfer from the Substitute of any of the rights,
benefits and/or obligations hereby transferred; or
(b) support any losses incurred by the Substitute by reason of any
non-performance by any Borrower or any other party to the Agreement
or any of the Security Documents or any document relating thereto of
any of its obligations under the same.
8 This Substitution Certificate and the rights and obligations of the
parties hereunder shall be governed by and construed in accordance with
English law. Clauses 22.2 and 22.3 of the Agreement inclusive are
incorporated herein by reference.
9 This Substitution Certificate may be executed in any number of
counterparts and by different parties on separate counterparts, each of
which when so executed and delivered shall be an original, but all
counterparts shall together constitute one and the same instrument.
NOTE: THIS SUBSTITUTION CERTIFICATE IS NOT A SECURITY, BOND, NOTE, DEBENTURE,
INVESTMENT OR SIMILAR INSTRUMENT.
AS WITNESS the hands of the authorised signatories of the parties hereto on the
date appearing below.
160
The Schedule
THE FACILITIES
FACILITY A
Facility A Tranche 1
Commitment (pound) Portion Transferred (pound)
Contribution (pound) Next Interest Payment Date Portion Transferred (pound)
Facility A Tranche 2
Commitment (pound) Portion Transferred (pound)
Contribution (pound) Next Interest Payment Date Portion Transferred (pound)
FACILITY B
Facility B Tranche 1
Commitment (pound) Portion Transferred (pound)
Contribution (pound) Next Interest Payment Date Portion Transferred (pound)
Facility B Tranche 2
Commitment (pound) Portion Transferred (pound)
Contribution (pound) Next Interest Payment Date Portion Transferred (pound)
THE WORKING CAPITAL FACILITY
Commitment (pound) Portion Transferred (pound)
Contribution (pound) Next Maturity Date(s) Portion Transferred (pound)
ADMINISTRATIVE DETAILS OF SUBSTITUTE
Lending Office:
Account for payments:
Telephone:
Telefax:
Attention:
161
Existing Bank] [Substitute]
By:______________________ By:_______________________
Date: Date:
The Agent
By:
________________________________
on its own behalf and on behalf of the other Finance Parties, the Borrowers and
all other parties to the Agreement and the Intercreditor Agreement.
162
PART B (GLOBAL FORM)
NB 1. Banks are advised not to employ Substitution Certificates or
otherwise to assign, novate or transfer interests in the Agreement
without first ensuring that the transaction complies with all
applicable laws and regulations, including the Financial Services
▇▇▇ ▇▇▇▇ and regulations made thereunder.
2. It is expected that Banks will enter into separate arrangements
dealing with the monies to be paid to the Existing Banks by the
Substitutes in consideration of the novation (e.g. principal,
accrued interest, fees and any mismatched funding adjustment).
Unless the Transfer Effective Date is a rollover date, mismatches of
parties' funding may arise. This Certificate does not deal with
these issues, nor does it deal with any interim risk participation
the Existing Banks may grant to the Substitutes pending the Transfer
Effective Date.
To: ▇.▇. ▇▇▇▇▇▇ Europe Limited on its own behalf, as agent for the Banks and on
behalf of the Arrangers, the Security Agent, the Underwriters, each Borrower and
each other party to the Agreement mentioned below and the Intercreditor
Agreement.
Attention: _ [DATE]
SUBSTITUTION CERTIFICATE
This Substitution Certificate relates to a Secured Credit Facilities Agreement
(the "AGREEMENT") dated 10 August 1999 and amended and restated on [_] 2002
between among others, the Borrowers party thereto, ▇.▇. ▇▇▇▇▇▇ plc and Barclays
Capital as Amendment Arrangers, ▇.▇. ▇▇▇▇▇▇ Europe Limited as Agent and Security
Agent, the persons whose respective names and addresses are set out in schedule
1 thereto as Banks. Terms defined in the Agreement shall have the same meaning
in this Substitution Certificate.
1 Each of the banks set out as Existing Banks in part A of the schedule
below (the "Existing Banks") (a) confirms the accuracy of the summary of
its participation in the Agreement set out in the schedule and (b)
requests each of the persons set out as Substitute Banks in Part C of the
schedule (the "Substitutes") to accept by way of novation the portion of
such participation specified (or calculated as specified) in the schedule
by counter-signing and delivering this Substitution Certificate to the
Agent at its address for the service of notices specified in the
Agreement.
2 Each of the Substitutes hereby requests the Agent (on behalf of itself,
the other Finance Parties, all Borrowers and all other parties to the
Agreement) to accept this Substitution Certificate as being delivered to
the Agent pursuant to and for the purposes of clause 16.3 of the Agreement
and clause 20.4 of the Intercreditor Agreement, so as to take effect in
accordance with the terms thereof on [date of transfer] (the "TRANSFER
EFFECTIVE DATE") or on such later date as may be determined in accordance
with the terms thereof.
163
3 The Agent (on behalf of itself, the other Finance Parties, the Borrowers
and all other parties to the Agreement) confirms each of the novations
effected by this Substitution Certificate pursuant to and for the purposes
of clause 16.3 of the Agreement and clause 20.4 of the Intercreditor
Agreement, so as to take effect in accordance with the respective terms
thereof.
4 Each of the Substitutes confirms:
(a) that it has received copies of the Finance Documents and all other
documentation and information required by it in connection with the
transactions contemplated by this Substitution Certificate;
(b) that it has not relied upon any statement, opinion, forecast or
other representation (including, without limitation, anything
contained in the Information Memorandum) or warranty made by the
Existing Banks, the Arrangers, the Underwriters, the Documentation
Agent, the Security Agent or the Agent to induce it to enter into
this Substitution Certificate;
(c) that it has made and will continue to make, without reliance on the
Existing Banks or any other Finance Party, and based on such
documents as it considers appropriate, its own appraisal of the
creditworthiness of each Borrower and the Group and its own
independent investigation of the financial condition, prospects and
affairs of each Borrower and the Group in connection with the making
and continuation of the Facilities under the Agreement and the other
Finance Documents;
(d) that neither the Existing Banks nor any other Finance Party shall at
any time be deemed to have had or have a duty or responsibility,
either historically, initially or on a continuing basis, to provide
the Substitute with any credit or other information with respect to
any Borrower or any other member of the Group or the Acquisition
Parties whether coming into its possession before the making of any
Drawing or at any time or times thereafter, other than (in the case
of the Agent) as provided in clauses 17.3(a) and 17.5(a) of the
Agreement;
(e) that it has made and will continue to make its own assessment of the
legality, validity, enforceability and sufficiency of the Agreement,
the Security Documents, each other Finance Document and this
Substitution Certificate and has not relied and will not rely on the
Existing Banks, the Arrangers, the Security Agent or the Agent or
any statements made by any of them in that respect;
(f) that, accordingly, none of the Existing Banks, the Arrangers, the
Security Agent and the Agent shall make any representations or
warranties in respect of, or shall have any liability or
responsibility to the Substitute in respect of, any of the foregoing
matters or any other matter referred to in clause 17.7 of the
Agreement;
(g) that it is [not] a Qualifying Bank; AND [NOTE: SPECIFY FOR EACH
SUBSTITUTE INDIVIDUALLY IF APPROPRIATE]
164
(h) that it has signed and agrees to be bound by and comply with an
appropriate confidentiality undertaking issued by the Existing
Banks.
5 Execution of this Substitution Certificate by each of the Substitutes
constitutes its representation to each of the Existing Banks and all other
parties to the Agreement and the Intercreditor Agreement that it has power
to become party to the Agreement and the Intercreditor Agreement as a Bank
or, as applicable, a Senior Bank on the terms herein and therein set out
and has taken all necessary steps to authorise execution and delivery of
this Substitution Certificate.
6 Each of the Substitutes hereby undertakes to the Existing Banks, the
Finance Parties, the Borrowers and each of the other parties to the
Agreement and the Intercreditor Agreement that it will perform in
accordance with its terms all those obligations which by the terms of the
Agreement and the Intercreditor Agreement will be assumed by it after
acceptance of this Substitution Certificate by the Agent.
7 Without limiting the above paragraphs, nothing in this Substitution
Certificate obliges any of the Existing Banks to:
(a) accept any re-transfer from any Substitute of any of the rights,
benefits and/or obligations hereby transferred; or
(b) support any losses incurred by any Substitute by reason of any
non-performance by any Obligor or any other party to the Agreement
or any of the Security Documents or any document relating thereto of
any of its obligations under the same.
8 Each of the Substitutes that executes this Substitution Certificate agrees
to be bound by this Substitution Certificate notwithstanding that any
other person (a "NON-SIGNING PARTY") that intended to execute this
Substitution Certificate as a Substitute may not do so or may not be
effectually bound. In such circumstances, the amount of each Existing
Bank's Commitments or Contributions that is transferred pursuant to this
Substitution Certificate (as set out in part B of the schedule) shall be
reduced pro-rata as between the Existing Banks by the amount which was
intended to be transferred to the Non-signing Party.
9 This Substitution Certificate and the rights and obligations of the
parties hereunder shall be governed by and construed in accordance with
English law. Clauses 22.2 and 22.3 of the Agreement inclusive are
incorporated herein by reference.
NOTE: THIS SUBSTITUTION CERTIFICATE IS NOT A SECURITY, BOND, NOTE, DEBENTURE,
INVESTMENT OR SIMILAR INSTRUMENT.
AS WITNESS the hands of the authorised signatories of the parties hereto on the
date appearing below.
165
THE SCHEDULE
PART A
EXISTING BANKS' COMMITMENTS, CONTRIBUTIONS (AND RELEVANT PROPORTIONS) BEING EACH
OF THEIR PARTICIPATIONS IN THE AGREEMENT AS AT THE DATE OF THIS SUBSTITUTION
CERTIFICATE
[Set out each Existing Bank's participation including Facility A, Facility B and
Working Capital Facility Commitment and Contribution and Relevant Proportions]
PART B
PORTION TRANSFERRED
[Set out the portion of each Existing Bank's Commitments, Contributions and
Relevant Proportion transferred]
The portion of an Existing Bank's [Commitments, Contributions and Relevant
Proportion in respect of each Facility etc.] to be transferred to a particular
Substitute is [as set out below/calculated as follows:]]
[set out details or method of calculation]
PART C
[Set out names of Substitute Banks and the aggregate amounts of the Commitments,
Contributions and Relevant Proportion in respect of each Facility being
transferred to them]
[Insert execution particulars and each Substitute's administration details]
[Each of the Existing Banks] [Each of the Substitutes]
By: _____________________ By:______________________
Date: Date:
The Agent
By:
_________________________
on its own behalf
and on behalf of the other Finance Parties, the Borrowers and all other parties
to the Agreement and the Intercreditor Agreement.
166
SCHEDULE 6
THE GROUP AS AT THE SECOND EFFECTIVE DATE
Newco 2
Premier Ambient Products (UK) Limited (company number 4427006)
Pastam Limited (company number 323282)
ORIGINAL CHARGING SUBSIDIARIES
ENGLISH
▇▇▇▇▇▇ Group Limited (company number 1721453)
C & TH (Calne) Limited (company number 183952)
Cadismark Household Products Limited (company number 1413161)
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited (company number 2081705)
Country Farms Limited (company number 305182)
Curf Farms (Chatteris) Limited (company number 1461987)
Equity Investments Management Limited (company number 2083957)
FMC (Meat) Limited (company number 671705)
Formwood Group (UK) Limited (company number 2046126)
Formwood Group Limited (company number 2175715)
H (Barnstaple) Limited (company number 2047347)
H (Elmswell) Limited (company number 1936070)
HL Foods Limited (company number 2560855)
H.I.T. Investments Limited (company number 2105858)
Hillsdown Ambient Foods Group Limited (company number 1220754)
Hillsdown Distribution Limited (company number 1875837)
Hillsdown Europe Limited (company number 2662027)
Hillsdown Holdings QUEST Limited (company number 3422198)
Hillsdown International Limited (company number 1943509)
Hillsdown Investments Limited (company number 1871848)
Hillsdown Produce Limited (company number 2183442)
Hillsdown UK Limited (company number 1638448)
▇. ▇. ▇▇▇▇ Limited (company number 1253499)
▇▇▇▇▇▇ Limited (company number 1778744)
Horberry & ▇▇▇▇▇ Limited (company number 1428538)
Kingsdown Leasing Limited (company number 390451)
Lamberde Properties Limited (company number 2277876)
MBM Mosspak Limited (company number 426939)
MBM Produce Limited (company number 426939)
Northwest Prime Investments Limited (company number 2641825)
Premier Financing Limited (company number 3716362)
Premier International Foods UK Limited (company number 314272)
R Financial Services Limited (company number 1943735)
▇▇▇▇, Manchett & Till Limited (company number 1746676)
Rugby Securities Limited (company number 1869278)
▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ Limited (company number 99843)
Premier Brands Limited (company number 96055)
Ridgways Limited (company number 105097)
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Sons (Est. 1849) Limited (company number 20563)
DUTCH
Hillsdown Holland B.V.
Hillsdown International B.V .
Jonker Fris B.V.
FRENCH
Hillsdown Holdings France S.A.S.
▇▇▇▇▇▇▇ ▇▇▇▇ ▇.▇ .
Premier Brands France S.A .
OTHER SUBSIDIARIES
ENGLISH
Anglo European Food Group Limited (company number 1044222)
▇▇▇▇▇▇▇▇ Foods Limited (company number 1081647)
Curf Growers Limited (company number IP2250612)
▇▇▇▇▇ ▇▇▇▇▇▇ Components Limited (company number 2046127)
FMC Limited (company number 671701)
FMC Products Limited (company number 549467)
FMC Superannuation & Pension Scheme Trustees Limited (company number 2374989)
Glengettie Tea Company Limited (company number 311427)
Gomme Holdings Limited (company number 274410)
▇▇▇ ▇▇▇▇▇▇ & Sons Limited (company number 1059522)
Harvest Agriculture Limited (company number 615823)
Harvest Poultry Limited (company number 786395)
Haywards Foods Limited (company number 2627084)
HF Pension Scheme Trustees Limited (company number 2375077)
Hillsdown Holdings Pension Trustees Limited (company number 2735596)
HMTF Poultry Limited (company number 3808291)
Honeysuckle Foods Limited (company number 3096231)
▇.▇. ▇▇▇▇▇▇▇▇ Limited (company number 623022)
Kardomah Limited (company number 4059)
▇▇▇▇▇ and ▇▇▇▇▇▇ Limited (company number 144678)
▇▇▇▇▇▇▇▇ (Country Meats) Limited (company number 1806466)
Meridian Tea Company Limited (company number 0444592)
North Devon Pension Scheme Trustees Limited (company number 2375072)
Premier Beverages Limited (company number 1676914)
Premier Biscuits Limited (company number 587165)
Premier Brands Pensions Trustees Limited (company number 2084542)
Premier Laboratory Services Limited (company number 274999)
168
Premier Preserves Limited (company number 1128631)
Premier Teas Limited (company number 2092180)
Pyke Holdings Limited (company number 101992)
Stratford-Upon-Avon Foods Limited (company number 4143852)
Sussex Farm Turkeys Limited (company number 1284938)
▇▇▇▇▇ International Limited (company number 477546)
The London Fruit & Herb Company Limited (company number 01648788)
The London Herb & Spice Co. Limited (company number 1183027)
The Specialist Soup Company Limited (company number 24168)
Typhoo Tea Limited (company number 371003)
▇▇▇ ▇▇▇▇▇▇ Limited (company number 387108)
▇▇▇ ▇▇▇▇▇▇ Holdings Limited (company number 301131)
▇. ▇▇▇▇▇▇ (London and ▇▇▇▇▇▇) Limited (company number 523736)
Winsford Bacon Company Limited (company number 855389)
GERMAN
Diamond Food Lebensmittelhandel GmbH
Formwood Deckensysteme GmbH
Hillsdown Backerei Beteiligungsgesellschaft GmbH
Solonia Sonnenschutz GmbH
Solonia Aluminum GmbH
ISLE OF MAN
Citadel Insurance Company Limited (company number 30246)
SCOTTISH
Premier Brands Exports Limited (company number 96054)
Premier Brands Overseas Limited (company number 96053)
Premier Food Limited (company number 105098)
Somniculous No.1 Limited (company number 78060)
Somniculous No.2 Limited (company number 79694)
DUTCH
Formwood Ceilings BV
Formwood Holdings BV
Luxrite BV
Hillsdown International Finance B.V.
SPAIN
MBM Spain S.A.
FRENCH
Hillsdown SA
Hillsdown Paris SA
169
Favols Industrie SA
SCI du Verger
SWITZERLAND
Confitech AG
UNITED STATES OF AMERICA
Hillsdown Seafoods Inc
GIBRALTAR
Abco Holdings Limited
Pall Mall Limited
170
SCHEDULE 7
STRUCTURE CHART
[STRUCTURE CHART]
171
[HILLSDOWN INTERNATIONAL FLOW CHART]
172
SCHEDULE 8
FINANCIAL UNDERTAKINGS, MARGIN AND COMMITMENT COMMISSION ADJUSTMENT AND
ACCOUNTING TERMS
1 FINANCIAL UNDERTAKINGS:
Newco 2 undertakes with each of the Finance Parties that, throughout the
Finance Period, it will ensure that:
1.1 Total Net Interest Cover:
The ratio of Consolidated EBITDA to Consolidated Net Interest Charges in
respect of each period set out in column A and measured at the last day of
the last month in such period shall be not less than the ratio set out in
column B:
A B
Period of 12 months ending on:
--------------------------------------------------- -------
30 June 2002 1.85:1
30 September 2002 1.85:1
31 December 2002 1.85:1
31 March 2003 1.85:1
30 June 2003 1.90:1
30 September 2003 1.90:1
31 December 2003 2.00:1
31 March 2004 2.00:1
30 June 2004 2.25:1
30 September 2004 2.25:1
31 December 2004 2.40:1
31 March 2005 2.40:1
30 June 2005 2.50:1
30 September 2005 2.50:1
31 December 2005 2.60:1
31 March 2006 2.60:1
30 June 2006 2.75:1
30 September 2006 2.75:1
31 December 2006 3.00:1
31 March 2007 3.00:1
30 June 2007 3.20:1
30 September 2007 3.20:1
31 December 2007 3.50:1
31 March 2008 3.50:1
30 June 2008 3.75:1
30 September 2008 3.75:1
and thereafter (on a rolling 12 month basis, at the
end of each Quarter) 3.75:1
173
1.2 Consolidated Fixed Charge Cover Ratio:
The Consolidated Fixed Charge Cover Ratio in respect of each period set
out in column A and measured at the last day of the last month in such
period shall not be less than the ratio set out in column B:
A B
Period of 12 months ending on:
30 June 2002 1.00:1
and thereafter (on a rolling 12 month basis,
on each 30 June and 31 December) 1.00:1
1.3 Total Net Debt to Consolidated EBITDA:
The ratio of the Total Net Debt as at the end of, to Consolidated EBITDA
in respect of, each period set out in column A and measured at the last
day of the last month in such period shall not be greater than the ratio
set out in column B:
A B
-------------------------------------------- ------
Period of 12 months ending on:
30 June 2002 5.60:1
30 September 2002 5.60:1
31 December 2002 5.60:1
31 March 2003 5.60:1
30 June 2003 5.20:1
30 September 2003 5.20:1
31 December 2003 4.65:1
31 March 2004 4.65:1
30 June 2004 4.30:1
30 September 2004 4.30:1
31 December 2004 3.90:1
31 March 2005 3.90:1
30 June 2005 3.65:1
30 September 2005 3.65:1
31 December 2005 3.30:1
31 March 2006 3.30:1
30 June 2006 3.00:1
30 September 2006 3.00:1
and thereafter (on a rolling 12 month basis,
at the end of each Quarter) 3.00:1
1.4 Maximum Capital Expenditure:
It will not, and will procure that no other member of the Group will,
undertake any, or enter into any financial commitments with respect to,
Capital Expenditure in any financial year if the total Capital Expenditure
of all members of the Group in such financial year would exceed the
Budgeted Capital
174
Expenditure for such financial year but so that, during the Finance
Period, Newco 2 can incur additional Capital Expenditure which is not
otherwise permitted under this paragraph 1.4 not exceeding, in aggregate,
(pound)10,000,000 (or its equivalent at the date of expenditure).
2 MARGIN AND COMMITMENT COMMISSION REDUCTION
2.1 At all times during the period of six months from the Second Effective
Date, the Margin in respect of Facility A and the Working Capital Facility
(the "VARIABLE MARGIN") shall be 2.25 per cent. per annum and the
Commitment Commission Rate in respect of the Working Capital Facility (the
"VARIABLE COMMITMENT COMMISSION RATE") shall be 0.75 per cent. per annum.
2.2 Thereafter, the Variable Margin shall be 2.25 per cent. per annum and the
Variable Commitment Commission Rate shall be 0.75 per cent. per annum
unless the reduction criteria set out below are satisfied in the most
recent compliance certificate delivered under clause 10.1(b)(iii) or (iv)
as referred to in paragraph 2.4, in which case the Variable Margin and the
Variable Commitment Commission Rate shall be reduced to the levels
indicated below with effect from the date upon which such certificate is
delivered to the Agent.
VARIABLE COMMITMENT
TOTAL NET DEBT: CONSOLIDATED VARIABLE MARGIN TO BE REDUCED COMMISSION RATE TO BE
EBITDA TO (% PER ANNUM) REDUCED TO (% PER ANNUM)
-------------------------------------------------- ----------------------------- ------------------------
Greater than or equal to 4.5:1 2.25 0.75
Greater than or equal to 4.0:1 but less than 4.5:1 2.00 0.625
Greater than or equal to 3.5:1 but less than 4:1 1.75 0.50
Greater than or equal to 3.0:1 but less than 3.5:1 1.50 0.375
less than 3.0:1 1.25 0.25
2.3 The Margin in respect of Facility B shall at all times be 2.75 per cent.
per annum.
2.4 For the purpose of this paragraph 2, the ratio of Total Net Debt to
Consolidated EBITDA shall be tested by reference to the most recent
compliance certificate delivered to the Agent pursuant to clause
10.1(b)(iii) or (iv) as the case may be. However, if on any day, Newco 2
has failed to deliver to the Agent under clause 10.1(b) the relevant
consolidated accounts of the Group and the related
175
compliance certificate in respect of any financial year end or, as the
case may be, Quarter and such failure is continuing, the Variable Margin
and the Variable Commitment Commission Rate for such day shall not be
subject to any reduction pursuant to this schedule 8.
2.5 Where in any financial year the Variable Margin and the Variable
Commitment Commission Rate have been reduced in respect of any day on the
basis of the accounts of the Group for any Quarter and a director's
compliance certificate delivered to the Agent pursuant to clause
10.1(b)(ii) and (iii) and the financial statements of the Group for that
financial year and auditor's compliance report in respect of such
financial year delivered pursuant to clause 10.1(b)(i) and (iv) show that
such reductions should not have been made, such reductions shall be
cancelled immediately and the Borrowers shall make such payments as may be
necessary to put the Banks in the position they would have been had no
such reductions been made.
2.6 Notwithstanding the satisfaction of the conditions set out above on any
relevant reduction date, no reduction in the Variable Margin and the
Variable Commitment Commission Rate then current shall occur if on such
date an Event of Default has occurred and is continuing unremedied, unless
and until such Event of Default has been remedied or waived by the
Majority Banks, in which case the scheduled reductions shall take place.
During any period that an Event of Default is continuing which has not
been remedied or waived by the Majority Banks the Variable Margin shall be
2.25 per cent. per annum and the Variable Commitment Commission Rate shall
be 0.75 per cent. per annum.
3 ACCOUNTING TERMS:
In clause 6.11 and paragraphs 1 and 2 of this schedule 8 accounting terms
are used and shall be construed in accordance with the Appropriate
Accounting Principles but so that:
"ACQUISITION COSTS" means all fees, costs, expenses and Taxes incurred by
any member of the Group in connection with the negotiation, preparation,
execution, notarisation and registration of the Transaction Documents, the
Finance Documents and the High Yield Bonds Documents and otherwise in
connection with the making of the Acquisition or the Second Acquisitions
or the Third Acquisitions;
"CAPITALISED LEASE OBLIGATIONS" means, with respect to any person, any
rental obligation (including, without limitation, any hire purchase
payment obligation) which, under the Appropriate Accounting Principles,
would be required to be treated as a Finance Lease or otherwise
capitalised on the books of such person in accordance with such
principles;
"CONSOLIDATED CURRENT ASSETS" means, at any relevant time, the aggregate
of the current assets of the Group at such time but excluding cash in hand
or at bank and the amount of fixed asset debtors calculated on a
consolidated basis which would fall to be included as current assets in a
consolidated balance sheet of the Group drawn up at such time in
accordance with the Appropriate Accounting Principles;
176
"CONSOLIDATED CURRENT LIABILITIES" means, at any relevant time, the
aggregate of the current liabilities of the Group at such time but
excluding the amount of fixed asset creditors, Consolidated Net Interest
Charges, Borrowed Money, Taxes, dividends and debit balances on bank
accounts calculated on a consolidated basis which would fall to be
included as current liabilities in a consolidated balance sheet of the
Group drawn up at such time in accordance with the Appropriate Accounting
Principles;
"CONSOLIDATED EBITDA" means, in respect of any period, the consolidated
trading profits, but before:
(a) exceptional items and extraordinary items;
(b) profits and losses on disposals of capital assets;
(c) deduction of Acquisition Costs;
(d) amortisation of goodwill and other intangible assets;
(e) depreciation;
(f) Consolidated Net Interest Charges and Taxes; and
(g) any non-cash charges and non-cash income,
of the Group for such period and before taking into account the applicable
share of any profit (except to the extent received in cash) or loss of any
joint venture or associate and after deducting (to the extent otherwise
included) profits (or adding back losses) attributable to minority
interests in Group members, provided that for the purposes of clause
10.2(f) and the determination of compliance with the Financial Covenants
in paragraphs 1.1 and 1.3 of this schedule 8 Consolidated EBITDA shall
include the trading profits (adjusted as set out above in this definition)
of (or attributable to) any business or assets that have been acquired by
the Group pursuant to a Permitted Acquisition (including, without
limitation, the Second Acquisitions), calculated on the same basis as
trading profits for the Group for such period as if such acquisition had
occurred on the first day of the relevant period for which Consolidated
EBITDA is being calculated. For these purposes, the relevant adjusted
trading profits of the business acquired pursuant to the UK Second
Acquisition shall be (pound)4,280,000 for the Quarter ending 30 September
2001, (pound)7,529,000 for the Quarter ending 31 December 2001,
(pound)2,754,000 for the Quarter ending 31 March 2002 and for the Quarter
ending 30 June 2002 shall be the adjusted trading profits for that
business for the period from the UK Second Acquisition Completion Date
until the end of that Quarter divided by the number of days in that period
and multiplied by 91;
"CONSOLIDATED EXCESS CASH FLOW" means, in respect of any financial year,
the amount of the Consolidated EBITDA for such financial year after
(without double counting) adding:
177
(i) any decrease in Consolidated Net Working Capital (excluding
amortisation of upfront fees and expenses in relation to the
Facilities or the Senior Subordinated Facility);
(ii) any receipts of cash exceptional and extraordinary items;
(iii) any refund received on account of Taxes paid; and
(iv) cash dividends and other similar cash payments received in respect
of investments;
and after deducting:
(a) Consolidated Net Interest Charges;
(b) all repayments and prepayments (other than mandatory prepayments
made pursuant to clauses 6.6, 6.10, 10.6(b) or 10.6(f)(xii) or the
equivalent provisions of the Senior Subordinated Facility Agreement)
of the Term Advances or the Senior Subordinated Facility Advances
(and under the Working Capital Facility to the extent cancelled)
made during such financial year (on the basis that for this purpose
crediting moneys to a Cash Collateral Account (or a cash collateral
account maintained or the purposes of the Senior Subordinated
Facility Agreement) pending prepayment will be deemed to be an
actual prepayment);
(c) the principal amount of scheduled rental payments of Capitalised
Lease Obligations during such financial year (whether or not
actually paid);
(d) Net Proceeds which are not yet unapplied Net Proceeds (as defined in
clause 6.10(ii));
(e) payments in respect of Capital Expenditure excluding the principal
amount of Indebtedness incurred in connection with such expenditure;
(f) any increase in Consolidated Net Working Capital (excluding
amortisation of upfront fees and expenses in relation to the
Facilities or the Senior Subordinated Facility);
(g) any payments of cash exceptional and extraordinary items;
(h) Taxes paid;
(i) the amount of carry over of Budgeted Capital Expenditure into the
next financial year;
(j) the aggregate net increase (or adding back the aggregate net
decrease) in all loans or credit made in cash pursuant to clause
10.6(i)(iv) or (ix);
(k) the aggregate amount of Permitted Acquisitions made which were
funded as referred to in clause 10.6(s)(B)(4);
178
(l) the aggregate amount of Equity Permitted Payments and Intercompany
Loan Permitted Payments made; and
(m) the aggregate net increase (or adding back the aggregate net
decrease) in all deposits required to be made in connection with
Derivatives Transactions permitted under clause 10.5(a).
The amount so produced shall be calculated (showing the calculations on
which it is based) in respect of each relevant financial year by Newco 2
who shall instruct the Auditors to deliver to the Agent a statement as to
the amount of the Consolidated Excess Cash Flow confirming that in all
material respects the calculation has been made in accordance with the
audited consolidated financial statements of the Group for such year and
the provisions of this paragraph 3 of schedule 8, such Auditors' statement
to be delivered to the Agent together with such audited consolidated
financial statements in accordance with clause 10.1(b)(i);
"CONSOLIDATED FIXED CHARGES" means, in respect of any period, the
aggregate of:
(a) Consolidated Net Interest Charges in respect of such period; and
(b) the total amount of scheduled repayments of the Term Advances;
"CONSOLIDATED FIXED CHARGE COVER RATIO" means, in respect of any period,
the ratio of:
(a) Consolidated EBITDA plus cash exceptional and extraordinary items
received in such period less (i) the amount (if any) by which
Capital Expenditure during such period exceeds the amount of any
carry over of Budgeted Capital Expenditure from the previous
financial year (and so that if the amount of any such carry over is
greater than the amount of Capital Expenditure this sub-paragraph
(i) shall be zero) and (ii) any amount payable (or reasonably likely
to be payable) in respect of Taxes during such period (or in respect
of any prior period (to the extent not previously taken into account
in determining the Consolidated Fixed Charge Cover Ratio)) and (iii)
cash exceptional and extraordinary items paid during such period; to
(b) Consolidated Fixed Charges for such period;
"CONSOLIDATED NET INTEREST CHARGES" means, in respect of a period, the
aggregate (calculated on a consolidated basis) of all continuing regular
or periodic costs, charges and expenses incurred in effecting, servicing
or maintaining any Borrowed Money of the Group (other than the
Subordinated Shareholder Loans) in respect of such period (but not agency
or arrangement fees) including:
(a) cash interest, guarantee, fronting and ancillary facility fees and
commitment fees on any form of such Borrowed Money accrued or paid
as
179
an obligation of any member of the Group during the period,
including the interest element of Finance Leases;
(b) the consideration given by the Group during the period by way of
discount in connection with such Borrowed Money by way of acceptance
credit, ▇▇▇▇ discounting or other like arrangement accrued or, as
the case may be, paid in respect of such Borrowed Money; and
(c) net payments in relation to interest rate hedging arrangements after
deduction of net income in relation to interest rate hedging
arrangements;
less the amount of interest accrued or, as the case may be, paid on cash
balances and Cash Equivalents of the Group during such period, provided
that for the purposes of clause 10.2(f) and the determination of
compliance with the Financial Covenants in paragraphs 1.1 and 1.3 of this
schedule 8 Consolidated Net Interest Charges shall include all the costs,
charges and expenses referred to above (less the deductions referred to
above) incurred in effecting, servicing or maintaining any Borrowed Money
of, or any Borrowed Money incurred by the Group for the purposes of the
acquisition (including the refinancing of any Borrowed Money) of, any
business or assets that have been acquired by the Group pursuant to a
Permitted Acquisition (including, without limitation, the Second
Acquisitions), calculated on the same basis as such costs, charges and
expenses (and deductions) are calculated by the Group for such period as
if such acquisition had occurred on the first day of the relevant period
for which Consolidated Net Interest Charges are being calculated;
"CONSOLIDATED NET WORKING CAPITAL" means, at any time, Consolidated
Current Assets at such time less Consolidated Current Liabilities at such
time; and
"TOTAL NET DEBT" means the principal element of Indebtedness incurred by
the Group in respect of all Borrowed Money (including, without limitation,
pursuant to this Agreement, the Senior Subordinated Facility Agreement or
the Intercompany Loan Agreement but excluding the Subordinated Shareholder
Loans and interest accruing on the Target/Newco 2 Loan Agreement) net of
cash and Cash Equivalents;
Provided that no amount shall be added or deducted more than once in any
definition.
180
SCHEDULE 9
FORM OF ACCESSION CERTIFICATE
To: ▇.▇. ▇▇▇▇▇▇ Europe Limited on its own behalf, as agent for the Banks party
to the Facilities Agreement mentioned below and on behalf of the
Borrowers, the Finance Parties party to, and any other parties to, the
Agreement
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Agency Loans Department [Date]
ACCESSION CERTIFICATE
This Accession Certificate relates to a Senior Secured Facilities Agreement (the
"AGREEMENT") dated 10 August 1999 and amended and restated on [o] 2002 between,
among others, the Borrowers party thereto, ▇.▇. ▇▇▇▇▇▇ plc and Barclays Capital
as Amendment Arrangers, ▇.▇. ▇▇▇▇▇▇ Europe Limited as Agent and Security Agent,
the persons whose respective names and addresses are set out in schedule 1
thereto as Banks. Terms defined in the Agreement shall have the same meaning in
this Accession Certificate.
1 [_] (the "ACCEDING BORROWER") hereby requests the Agent (on behalf of
itself, the Borrowers, the Finance Parties and any other parties to the
Agreement) to accept this Accession Certificate as being delivered to the
Agent pursuant to and for the purposes of clause 20.1 of the Agreement so
as to take effect in accordance with the respective terms thereof on the
date hereof.
2 The Acceding Borrower is, pursuant to this Accession Certificate, acceding
to the Agreement as a Borrower in respect of [the Working Capital
Facility][Ancillary Facilities] only and accordingly shall, subject to the
terms of this Accession Certificate and the Agreement, become a Borrower
under the Agreement.
3 The Agent (on behalf of itself, the Borrowers, the Finance Parties and any
other parties to the Agreement) confirms the accession to the Agreement
effected by this Accession Certificate pursuant to and for the purposes of
clause 20.1 of the Agreement so as to take effect in accordance with the
terms thereof.
4 The Acceding Borrower hereby:
(a) represents and warrants to the Finance Parties in accordance with
clause 9.3 of the Agreement; and
(b) undertakes to the Agent (on behalf of itself, the Borrowers, the
Finance Parties and any other parties to the Agreement) that it will
perform in accordance with their terms all those obligations which
by the terms of the Agreement will be assumed by it as a [Working
Capital Borrower] [Ancillary Facilities Borrower] after acceptance
of this Accession Certificate by the Agent.
5 This Accession Certificate is intended to take effect as a Deed
notwithstanding that the Agent may execute it under hand only.
181
6 This Accession Certificate and the rights and obligations of the parties
hereunder shall be governed by and construed in accordance with English
law and clauses 22.2 and 22.3 of the Agreement are incorporated herein by
reference.
IN WITNESS whereof this Accession Certificate has been entered into as a Deed on
the date above.
The Acceding Borrower
[EXECUTION PARTICULARS -
SUBSIDIARY TO EXECUTE AS A DEED]
The Agent
By:
___________________________
on its own behalf and on behalf of the Borrowers, the Finance Parties and all
other parties to the Agreement. Schedule 1
182
SCHEDULE 10
FORM OF DIRECTOR'S CERTIFICATE
[Not restated]
183
SCHEDULE 11
FORM OF ANNUAL AUDITOR'S REPORT
To: ▇.▇. ▇▇▇▇▇▇ Europe Limited
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Agency Loans Department [Date]
Dear Sirs
SECURED CREDIT FACILITIES AGREEMENT DATED 10 AUGUST 1999 AND AMENDED AND
RESTATED ON [_] 2002 (AS FROM TIME TO TIME FURTHER AMENDED, VARIED,
EXTENDED, RESTATED OR REPLACED (THE "FACILITIES AGREEMENT")
We refer to the Facilities Agreement and deliver this Certificate in respect of
the financial year ended [ ] pursuant to clause 10.1(b)(iv) thereof. Terms
defined in the Facilities Agreement shall have the same meaning when used in
this Certificate.
1 We confirm that on or as of the last day of the financial year ending [ ],
as determined by reference to the audited accounts of the Group in respect
of such financial year:
(a) The ratio of Consolidated EBITDA to Consolidated Net Interest
Charges for such financial year was [ ];
(b) The Consolidated Fixed Charge Cover Ratio for such financial year
was [ ];
(c) The ratio of Total Net Debt to Consolidated EBITDA for such
financial year was [ ]; and
(d) Capital Expenditure during such financial year was [ ].
Based on the above, we confirm that Newco 2 was in compliance with the Financial
Covenants [or, if not, indicate the extent of any non-compliance] as at the end
of such financial year.
2 We confirm that, as determined by reference to the audited accounts of the
Group in respect of such financial year, on or as of the last day of the
financial year ending [ ]:
(a) the pro forma Consolidated EBITDA of the Charging Group (measured as
if references in the definition of Consolidated EBITDA to the
"Group" were references to the "Charging Group") constitutes [95 per
cent. or more] of the Consolidated EBITDA of the Group;
184
(b) the pro forma consolidated turnover of the member of the Charging
Group constitutes [95 per cent. or more] of the consolidated
turnover of the Group; and
(c) the pro forma consolidated total assets of the members of the
Charging Group constitute [95 per cent. or more] of the consolidated
total assets of the Group,
in each case tested on a rolling 12 months basis and therefore that Newco
2 was in compliance with the undertaking set out in clause 10.1(f)(ii) as
at [ ].
3 We confirm that, as determined by reference to the audited accounts of the
Group in respect of the financial year ending [ ], on or as of the last
day of such financial year, the members of the Group which were Material
Entities within the meanings of sub-paragraph (c)(i), (ii), (iii) or (iv)
of the definition of "Material Entity" were: [ ]
For and on behalf of
[Name of Auditors]
______________________________
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SCHEDULE 12
TERMS OF INDEMNITY IN RELATION TO LETTERS OF CREDIT
1 (a) Each relevant Working Capital Borrower hereby unconditionally and
irrevocably agrees and undertakes to the Fronting Bank, subject to
negligence or wilful default by the Fronting Bank in its capacity of
Fronting Bank, that it will at all times indemnify the Fronting Bank
on demand of the Agent and keep the Fronting Bank indemnified on
demand of the Agent from and against all actions, suits,
proceedings, claims, demands, liabilities, damages, costs or
reasonable expenses, losses and reasonable charges whatsoever in
relation to or arising out of any utilisation of the Working Capital
Facility by the issue of Letters of Credit and the relevant Working
Capital Borrower will pay to the Agent for account of the Fronting
Bank the amount of all payments made (whether directly or by way of
set-off, counterclaim or otherwise howsoever) (other than any such
cost or loss caused by or arising from the gross negligence or
wilful default of such Fronting Bank) and all losses, costs or
expenses suffered or incurred from time to time by the Fronting
Bank, by reason or in consequence of its incurring a liability under
any utilisation of the Working Capital Facility by the issue of
Letters of Credit and any of the aforesaid indemnities relating
thereto (other than any such cost, loss or expense caused by or
arising from the gross negligence or wilful default of such Fronting
Bank).
(b) The liability of the relevant Working Capital Facility Borrower
under this indemnity shall not be discharged, lessened or impaired
by any time being given or by anything being done by the Fronting
Bank.
2 Each relevant Working Capital Borrower specifically releases and
indemnifies the Fronting Bank from and against the consequences of the
Fronting Bank's failure and/or the failure of any other person to receive
any telex, facsimile or telephone message in a form in which it was
despatched and from and against the consequences of any delay that may
occur during the course of the transmission of any such message.
3 The obligations of each relevant Working Capital Borrower hereunder and
under each document executed pursuant to or in relation to this Agreement
shall not be in any way discharged or impaired by reason of any time or
other indulgence which may be granted (a) to the Fronting Bank by any
beneficiary of any utilisation of the Working Capital Facility by the
issue of Letters of Credit or (b) by the Fronting Bank to any person from
whom it may seek reimbursement in respect of sums paid out by it under any
utilisation of the Working Capital Facility or any other obligation
pursuant thereto or pursuant to this Agreement, as the case may be; by any
variation of any underlying agreement, this Agreement or any such
document; nor by any circumstance which would or might (but for this
provision) constitute a legal or equitable discharge or defence of the
relevant Working Capital Borrower.
4 The Fronting Bank may, at any time, without thereby discharging, impairing
or otherwise affecting any security created by, pursuant to or in relation
to this Agreement or the rights, powers and remedies conferred upon it by
this
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Agreement, any such security or by law, (a) offer or agree to or enter
into agreement for the extension or variation of any utilisation of the
Working Capital Facility by the issue of Letters of Credit or (b) offer to
give or agree to give any time or other indulgence in relation to any sums
paid out by it under any utilisation of the Working Capital Facility by
the issue of Letters of Credit, any obligation pursuant thereto or any
other obligation pursuant to this Agreement.
5 Any rights conferred on the Fronting Bank by this Agreement and by each
document executed pursuant to or in relation to this Agreement shall be in
addition to and not in substitution for or derogation of any other rights
which the Fronting Bank may at any time have to seek from any relevant
Working Capital Borrower or any other person, reimbursement of or
indemnification against payments made or liabilities incurred under any
utilisation of the Working Capital Facility by the issue of Letters of
Credit, any obligation pursuant thereto or any other obligation pursuant
to this Agreement.
6 Any satisfaction of obligations by any relevant Working Capital Facility
Borrower or any other person to the Fronting Bank or any discharge given
by the Fronting Bank to any relevant Working Capital Borrower or any other
person in respect of obligations hereunder or related hereto or any other
agreement reached between the Fronting Bank and any relevant Working
Capital Borrower or any other person in relation thereto shall be, and be
deemed always to have been, void if any act satisfying any of the said
obligations or on the faith of which any such discharge was given or any
such arrangement was entered into is subsequently avoided by or in
pursuance of any provision of law (otherwise than as a result of any act
or default by the Fronting Bank).
7 For the purposes of this Agreement, a utilisation of the Working Capital
Facility by the issue of Letters of Credit shall be considered to be
outstanding until the earliest of (a) the date of return of the document
evidencing the Fronting Bank's liability to the relevant beneficiary under
such utilisation of the Working Capital Facility to the Fronting Bank, (b)
the expiry date referred to in that document (being the latest date by
which the beneficiary thereof shall be entitled to make a demand of the
Fronting Bank thereunder) and (c) the date on which all liabilities
referred to in that utilisation of the Working Capital Facility have been
discharged or cash collateralised in full.
8 Each relevant Working Capital Borrower hereby confirms and agrees that:
(a) the Fronting Bank shall be entitled and bound to make any payment
requested or demanded in writing by any beneficiary under any
utilisation of the Working Capital Facility by the issue of Letters
of Credit which are valid on their face and appears to comply with
the terms thereof regardless of whether or not the relevant Group
debtor shall be in any way in breach of any of its obligations under
or by virtue of the transaction to which that utilisation of the
Working Capital Facility by the issue of Letters of Credit refers
and without making any investigation as to the bona fide nature,
validity or genuineness of any such request or demand (unless, under
applicable law, the Fronting Bank is under no obligation to make
such payment); and
187
(b) the liability of any relevant Working Capital Borrower hereunder and
the right and obligation of the Fronting Bank to make such payment
shall be in no way diminished or prejudiced if it should appear
that, as between the relevant Group debtor and that beneficiary,
that beneficiary was not entitled for whatever reason to demand
payment under such utilisation of the Working Capital Facility by
the issue of Letters of Credit or that such demand was not valid or
genuine (subject as mentioned in paragraph 8(a) above).
188
SCHEDULE 13
PART A
[NOT RESTATED]
189
PART B
[NOT RESTATED]
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SCHEDULE 14
▇▇▇▇▇ MUSE'S FEES
1 Fees due and payable pursuant a monitoring and oversight agreement dated
10 August 1999 by and between Newco 2 and ▇▇▇▇▇, Muse & Co. Partners,
L.P., a Texas limited partnership ("HMCo") (in such form, the "MONITORING
AGREEMENT"), in the amount of an annual monitoring fee of (pound)1,170,000
which monitoring fee shall be adjusted on January 1 of each calendar year
to an annual amount equal to (A) the budgeted consolidated annual net
sales of Newco 2 and its Subsidiaries for the then current fiscal year,
multiplied by (B) 0.1%; provided however, that the monitoring fee shall
never be less than (pound)1,170,000.
2 Pro rata share of Allocable Expenditures reimbursed by Newco 2 pursuant to
that certain Monitoring Agreement. Allocable Expenditures being defined as
all variable, fixed and other costs, expenses, expenditures, charges or
obligations (including without limitation letters of credit, deposits,
etc.) that are related to assets utilized, services provided, or programs
administered by HMCo or its affiliates in connection with the performance
by HMCo of financial oversight and monitoring services on behalf of Newco
2 and other participating acquired companies, including without limitation
corporate airplanes, charitable contributions, retainers for lobbyists and
other professionals, and premiums and finance charges for director and
officer insurance maintained for representatives of HMCo or its
affiliates.
3 Fees due and payable pursuant a financial advisory agreement dated 10
August 1999 between Newco 2 and HMCo (in such form, the "ADVISORY
AGREEMENT") constituting a financial advisor fee for HMCo in the amount of
(pound)9,633,000.
4 Fees due and payable pursuant to the Advisory Agreement constituting
compensation for HMCo's financial advisory, investment banking and other
similar services rendered in connection with any "Subsequent Transaction"
in the amount of a cash fee equal to 1.5% of the total value of the
Subsequent Transaction, including, without limitation, the aggregate
amount of the funds required to complete the SubsequentTransactions
(excluding any fees payable pursuant to the Advisory Agreement with
respect to Subsequent Transactions) including the amount of the
indebtedness, preferred stock or similar items assumed (or remaining
outstanding). "SUBSEQUENT TRANSACTION" means, collectively, any future
proposals for a tender offer, acquisition, sale, merger, exchange, offer,
recapitalization, restructuring or other similar transaction directly or
indirectly involving Newco 2, or any of its Subsidiaries, and any other
person or entity.
Reimbursement of reasonable disbursements and out-of-pocket expenses (including
fees and disbursements of counsel) incurred by HMCo pursuant to the Financial
Advisory Agreement.
191
SCHEDULE 15
OTHER FINANCE PARTIES
▇.▇. ▇▇▇▇▇▇ plc as Original Arranger
JPMorgan Chase Bank as Original Underwriter
Deutsche Banc. ▇▇▇▇ ▇▇▇▇▇ Incorporated (or its successor) as Original Arranger
Salomon Brothers International Limited as Original Arranger
Bankers Trust Company (or its successor) as Original Underwriter and
Documentation Agent
Citibank N.A. as Original Underwriter
192
[EXECUTION PARTICULARS NOT RESTATED]
193