Exhibit 2(d)
DATED ________ 2000
LIHIR GOLD
SECURITY TRUST DEED
LIHIR GOLD LIMITED
("BORROWER")
ABN AMRO AUSTRALIA LIMITED
("FACILITY AGENT")
ABN AMRO AUSTRALIA LIMITED
("SECURITY TRUSTEE")
NIUGINI MINING LIMITED
("NML")
NIUGINI MINING (AUSTRALIA) PTY
LIMITED
("NMAL")
AND
INITIAL HEDGE COUNTERPARTIES
MALLESONS ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Solicitors
Governor ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇
Telephone (▇▇ ▇) ▇▇▇▇ ▇▇▇▇
Fax (▇▇ ▇) ▇▇▇▇ ▇▇▇▇
DX 113 Sydney
Ref: PJD:YC:PDD
CONTENTS LIHIR GOLD - SECURITY TRUST DEED
1 DEFINITIONS AND INTERPRETATION 1
Definitions 1
Interpretation 13
Headings 13
Facility Agent 13
Limitation of liability 13
Calculation of close-out amounts under Hedge
Contracts 14
2 DECLARATION OF TRUST 14
Declaration of trust 14
Termination of trust 15
Name of trust 15
Payment of Secured Money 15
Manner of payment 15
Currency of payment 15
Taxes 16
GST gross up 16
3 DUTIES, POWERS AND RIGHTS OF SECURITY TRUSTEE 16
Authority of Security Trustee 16
Extent of authority and obligations 17
Binding nature of relationship 17
Excluded roles and duties 17
Power of the Security Trustee 17
Instructions, extent of discretions 17
Majority Senior Beneficiaries 19
Unanimous consent of Senior Beneficiaries 19
Borrower not to investigate authority 19
Limits on duties of Security Trustee 19
Notice of Event of Default 20
No representation by Security Trustee 20
No individual enforcement by Beneficiaries 20
Reliance on documents and experts 20
Security Trustee's obligations 20
No further obligations 21
Assuming compliance 21
Limit on disclosure obligations 21
Exoneration 21
Security Trustee in capacity of a Financier or other Beneficiary 22
Dealing in different capacities 22
Delegation by Security Trustee 22
Force Majeure 23
No responsibility for force majeure 23
Funds before acting 23
If a Beneficiary does not fund 23
Indemnity to Security Trustee 24
Removal of Security Trustee 24
Retirement 25
Security Trustee fee 26
ii
4 SUBORDINATION 26
Subordination 26
Rights and obligations following an Event 26
Junior Creditor Undertakings 27
Permitted payments 27
Borrower 28
Revocation of approvals 28
Preservation of Senior Beneficiary's rights 29
Corporations Act 30
Limitation on rights of Junior Beneficiaries 30
Acknowledgment by Junior Beneficiaries and Junior Creditors 30
5 CHANGE IN BENEFICIARIES 31
Change in Beneficiaries 31
New Beneficiaries and Finance Documents 32
Only certain obligations allowed 32
Finance Document 33
Security Trustee may execute for other parties 33
When effective 33
Stamp duty 34
Complete refinancing 34
6 CEASING TO BE A BENEFICIARY 34
Borrower request 34
Beneficiary request 34
Beneficiary to assist 34
When effective 34
Accession Deed 34
7 POLITICAL RISK INSURANCE 35
Subrogation under Political Risk Insurance for Financiers 35
Political Risk Insurer becoming a Beneficiary 35
Advising Insured Payments 36
8 REGISTER 36
9 ENFORCEMENT 37
Events of Default 37
Security Trustee to advise Voting Day 37
Beneficiaries to advise Exposures 37
Security Trustee to issue Acceleration Notices 37
Beneficiaries to comply with Acceleration Notices 37
Hedge Counterparties 37
Junior Beneficiary attending meetings 38
Notification to Junior Beneficiary 38
10 TREATMENT OF RECOVERED MONEYS 38
Moneys not forming part of Recovered Moneys 38
Receipt not through Security Trustee 39
Accounting to Security Trustee 39
Refund to Beneficiary 39
iii
Netting as between Hedge Transactions not to constitute Recovered Money 40
Sharing in relation to Non-Hedge Transactions 40
Proceeds of Political Risk Insurance Policies not to constitute
Recovered Money 40
11 DISTRIBUTION OF RECOVERED MONEY 40
12 REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT 41
Representations and warranties 41
Undertakings relating to Secured Property 42
Further assurances 44
Rights of entry 44
Reasonable notice of entry 45
Right to rectify 45
Security Trustee not mortgagee in possession 45
Payment of income to Security Trustee 45
Event of Default 45
13 COSTS AND INDEMNITIES 45
What the Borrower agrees to pay 45
Indemnity 46
Currency conversion on judgment debt 47
Stamp duty 47
14 ACKNOWLEDGMENT 47
15 NOTICES 48
16 GENERAL 49
Set-off 49
Certificates 49
Discretion in exercising rights 49
Consents 49
Partial exercising of rights 49
Conflict of interest 49
Remedies cumulative 50
Rights and obligations are unaffected 50
Indemnities 50
Variation and waiver 50
Further steps 50
Inconsistent law 50
Supervening legislation 50
Reinstatement of rights 50
Time of the essence 51
Counterparts 51
17 GOVERNING LAW, JURISDICTION AND SERVICE OF PROCESS 51
SCHEDULE 1 DESIGNATION NOTICE 52
SCHEDULE 2 ACCESSION DEED 53
SCHEDULE 3 ACCESSION DEED FOR HEDGE PRI 55
iv
SCHEDULE 4 INITIAL HEDGE COUNTERPARTIES 57
LIHIR GOLD - SECURITY TRUST DEED
DATE: 2000
PARTIES: LIHIR GOLD LIMITED (ARBN 069 803 998) (Company No. 1 - 23423)
incorporated in Papua New Guinea of Level 7, Pacific Place, Cnr
Champion Parade and ▇▇▇▇▇▇▇▇ Street, Port Moresby, Papua New Guinea
("BORROWER")
ABN AMRO AUSTRALIA LIMITED (ABN 78 000 862 797) having an office at
Level 26, ABN AMRO Tower, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, in its capacity as agent for the Financiers
("FACILITY AGENT")
ABN AMRO AUSTRALIA LIMITED (ABN 78 000 862 797) having an office at
Level 26, ABN AMRO Tower, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, in its capacity as Security Trustee under this deed
("SECURITY TRUSTEE")
NIUGINI MINING LIMITED having an office at c/- Lihir Gold Limited,
Level ▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ("NML")
NIUGINI MINING (AUSTRALIA) PTY LIMITED having an office at c/- Lihir
Gold Limited, Level ▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
("NMAL")
EACH PERSON NAMED IN SCHEDULE 4 (each, an "INITIAL HEDGE
COUNTERPARTY")
1 DEFINITIONS AND INTERPRETATION
DEFINITIONS
1.1 The following words have these meanings in this deed unless the
contrary intention appears.
ACCELERATION NOTICE means, in respect of the Borrower, a notice given
to a Beneficiary by the Security Trustee (in a form determined by the
Security Trustee) which directs the Beneficiary to take all reasonable
steps open to it (including, without limitation, serving any notice or
making any declaration or demand) so that:
(a) the obligations of the Borrower under or in connection with each
Finance Document to which that Beneficiary is a party are
accelerated in respect of the Borrower (including, without
limitation, closing out any unexpired Hedge Transaction) and
become due for payment as soon as possible thereafter; and
(b) the obligations of the Beneficiary under that Finance Document
are, to the maximum extent possible, terminated immediately.
2
ACCESSION DEED means a deed in or substantially in the form of
schedule 2 or, in the case of the Political Risk Insurer providing
Hedge PRI, schedule 3, or such other form as agreed by the Security
Trustee.
ACTION means action which may result in an amendment, waiver,
determination, consent, approval, release or discharge.
AGGREGATE SENIOR EXPOSURE means at any time, the sum of all Exposures
of all Senior Beneficiaries under all Senior Finance Documents at that
time.
AUTHORISATION means any approval, authorisation, consent, exemption,
filing, licence, notarisation, registration or waiver, howsoever
described, and any renewal or variation of any of them.
AUTHORISED OFFICER means:
(a) in the case of a Beneficiary, a director, secretary or an officer
whose title contains the word "manager", "director", "lawyer",
"counsel" or a person performing the functions of any of them;
and
(b) in the case of the Borrower, a person appointed and notified to
the Security Trustee (in a notice signed by a director of the
Borrower) to act as an Authorised Officer under the Security
Trustee Documents to which it is a party and whose specimen
signature has been given to the Security Trustee.
BENEFICIARY means each Senior Beneficiary and each Junior Beneficiary.
Where the term "to the Beneficiaries" is used in relation to the
obligations of any one of those persons, it is a reference to the
obligations of that person to each other person which is a
Beneficiary.
▇▇▇▇ has the meaning it has in the Bills of Exchange Act 1909 (Cwlth)
and a reference to the drawing, acceptance or endorsement of, or other
dealing with, a Bill is to be interpreted in accordance with that Act
(or its equivalent under the laws of any other applicable
jurisdiction).
BUSINESS DAY means a day (not being a Saturday, Sunday or public
holiday) on which banks are open for general banking business in
Sydney, Australia, New York City and London.
CONTROLLER means, in relation to a body corporate, any receiver,
receiver and manager or any other person (whether or not as agent for
that body corporate), which is in possession or has control of that
body corporate's property for the purpose of enforcing a charge.
CORPORATIONS ACT means the Corporations Act 2001 (Cth).
COSTS includes costs, charges and expenses, including those incurred
in connection with advisers.
EFFECTIVE TIME has the meaning given in the Refinancing Coordination
Deed.
3
ENFORCEMENT ACTION means an application is made for, or a notice is
given or other step is taken with a view to:
(a) insolvency, liquidation, administration, dissolution or similar
proceedings with respect to the Borrower;
(b) an administration, arrangement, composition or assignment for the
benefit of creditors, or any class of creditors, of the Borrower;
or
(c) the appointment of any person as a Controller in relation to
property of the Borrower,
whether by petition, application, convening of a meeting, voting in
favour of a resolution or otherwise.
ENFORCEMENT DATE means the day on which an Acceleration Notice is
issued under clause 9.6.
EVENT means the happening of any of these events:
(a) an order is made that the Borrower be wound up; or
(b) a liquidator is appointed in respect of the Borrower; or
(c) a provisional liquidator is appointed in respect of the Borrower
and the provisional liquidator is ordered or required to admit
all debts to proof or pay all debts capable of being admitted to
proof proportionately; or
(d) the Borrower enters into, or resolves to enter into, a scheme of
arrangement, deed of company arrangement or composition with, or
assignment for the benefit of, all or any class of its creditors;
or
(e) the Borrower resolves to wind itself up or otherwise dissolve
itself.
EVENT OF DEFAULT means each event, circumstance or other act, matter
or thing which enables a Beneficiary to accelerate any indebtedness,
terminate any commitments or terminate early any financial
accommodation or transaction under a Finance Document.
EXPOSURE means, at any time in respect of a Beneficiary:
(a) in relation to Hedge Transactions, that Beneficiary's Hedge
Exposure; and
(b) otherwise, the aggregate of all amounts which then are due for
payment, owing but not currently due for payment, contingently
owing or remain unpaid under a Finance Document by the Borrower
or, in the case of any revolving credit facility under any
Finance Document, the amount of any commitment which remains
available for drawing thereunder by the Borrower and has not been
cancelled.
4
FINALLY PAID means in respect of a monetary liability, payment or
discharge of it in full.
FINANCE DOCUMENT means:
(a) any Senior Finance Document;
(b) any Junior Finance Document.
FINANCIERS has the meaning given in the Syndicated Facility Agreement.
GOVERNMENT AGENCY means a government or government department, a
governmental, semi-governmental, fiscal, monetary or supervisory
authority or judicial person or a person (whether autonomous or not)
charged with the administration of any applicable law.
GST has the meaning given in the A New Tax System (Goods and Services
Tax) 1999 (C'wlth).
HEDGE CONTRACT means any agreement setting out the terms and
conditions of a Hedge Transaction. It includes any master agreement
and any confirmations given under it.
HEDGE COUNTERPARTY means:
(a) each Initial Hedge Counterparty; and
(b) each other party to a Hedge Transaction other than the Borrower.
HEDGE EXPOSURE on a day means, in respect of a Hedge Counterparty, an
amount which would be payable by the Borrower to a Hedge Counterparty
in respect of all Hedge Transactions between the Borrower and that
Hedge Counterparty assuming (without any double-counting):
(a) all amounts actually due and payable but which remain unpaid to
the Hedge Counterparty under those Hedge Transactions were
payable (including any close-out amount calculated pursuant to
clause 1.6(b));
(b) all of those Hedge Transactions with that Hedge Counterparty
which have not been closed out and terminated were closed out and
terminated on that day, with the notional close-out amount
calculated pursuant to clause 1.6(a); and
(c) all margin (if any) held for the Hedge Transactions were applied
against the Hedge Transactions; and
(d) all amounts (actually or notionally) payable under all Hedge
Transactions (ignoring all hedging transactions which are not
Hedge Transactions) referred to in paragraphs (a) and (b) were
netted between themselves.
5
Hedge Exposure, in relation to a Political Risk Insurer who has become
a Beneficiary pursuant to a Hedge PRI, means the sum of all Insurance
Payments made under that Hedge PRI (including but without
double-counting amounts which have been assigned by an Insured Hedge
Counterparty to that Political Risk Insurer in connection with a claim
under the relevant Hedge PRI in respect of any amount referred to
above).
HEDGE PRI means a Political Risk Insurance Policy between a Political
Risk Insurer and an Insured Hedge Counterparty in respect of any or
all of its Hedge Contracts.
HEDGE TRANSACTION means:
(a) each gold hedging transaction entered into or proposed to be
entered into between the Borrower and any counterparty; and
(b) such other form of hedging transaction entered into or proposed
to be entered into between the Borrower and any counterparty with
the prior written approval of the Security Trustee (acting on the
instructions of the Majority Senior Beneficiaries).
IMMEDIATELY AVAILABLE FUNDS means a bank cheque, telegraphic transfer,
electronic funds transfer or any other immediately available funds
received in the ordinary course of banking practice.
INDEBTEDNESS means any debt or other monetary liability (whether
actual or contingent) in respect of moneys borrowed or raised or any
financial accommodation (including in respect of any moneys raised
from the sale or securitisation of any receipts or receivables)
whatever, or a derivative transaction, including a debt or liability
under or in respect of any:
(a) Bill, bond, debenture, note or similar instrument;
(b) acceptance, endorsement or discounting arrangement;
(c) guarantee granted by a financial institution guaranteeing the
payment of a debt (the "guaranteed debt"), in which case the
guaranteed debt will not be included;
(d) finance lease or sale and leaseback;
(e) deferred purchase price (for more than 180 days) of any asset or
service;
(f) obligation to deliver goods or provide services paid for in
advance by any financier or in relation to any other financing
transaction;
(g) amount of capital and premium payable or in connection with the
reduction of any preference shares or any amount of
6
purchase price payable for or in connection with the acquisition
of redeemable preference shares;
(h) any derivative transaction; or
(i) guarantee, indemnity or guarantee and indemnity,
and irrespective of whether the debt or liability is owed or incurred
alone or severally or jointly or both with any other person. For the
purpose of calculating the principal amount of any Indebtedness under:
(A) any securitisation of receipts or receivables, the principal
amount shall be taken to be the discounted amount of proceeds
paid in exchange for the receipts or receivables; and
(B) any finance lease or sale and leaseback, the aggregate portion of
all rental in the nature of principal.
INSURANCE PAYMENT means payment of a claim made or to be made by a
Political Risk Insurer under a Political Risk Insurance Policy (and,
in relation to a payment of an accepted claim under a Political Risk
Insurance Policy in connection with the Syndicated Facility Agreement
which is payable in installments, the total amount of the claim).
INSURED HEDGE COUNTERPARTY means any Hedge Counterparty who, from time
to time, has a current Political Risk Insurance Policy in respect of
any or all of its Hedge Contracts.
INTEREST includes, in relation to any principal or other amount of
Indebtedness, interest, fees, commissions and charges and any other
amounts in the nature of interest or the payment of which has a
similar effect or purpose to the payment of interest.
ISDA MASTER AGREEMENT means the 1992 multicurrency cross border
version of the master agreement published by the International Swap
Dealers Association Inc. as updated from time to time.
JUNIOR BENEFICIARY means:
(a) [intentionally blank]
(b) each other person to whom the Borrower owes or will owe money
under or in respect of a Junior Finance Document.
JUNIOR CREDITOR means:
(a) [intentionally blank]
(b) NML;
(c) NMAL; and
(d) each other person to whom the Borrower owes or will owe money
under or in respect of a Junior Finance Document.
7
JUNIOR DEBT means:
(a) any amount actually or contingently owing under or in connection
with the Junior Finance Documents; and
(b) in the case of NML and NMAL only, any money which the Borrower is
or at any time may become actually or contingently liable to pay
to or for the account of NML or NMAL pursuant to any financial
accommodation arrangement (whether written or verbal or any
combination thereof).
JUNIOR FINANCE DOCUMENT means:
(a) [intentionally blank];
(b) any arrangement (whether written or oral or any combination
thereof) in relation to which the Borrower is or at any time may
become actually or contingently liable to pay money to, or for
the account of, NML and/or NMAL in respect of financial
accommodation provided or to be provided by NML and/or NMAL;
(c) this deed; and
(d) any deed, agreement or other instrument designated as a Junior
Finance Document in an Accession Deed.
LEASE means:
(a) the Special Mining Lease No 6 dated 17 March 1995 granted by the
PNG government to Kennecott Explorations (Australia) Ltd, NML and
Mineral Resources Lihir Pty Limited and transferred to the
Borrower on 15 October 1995 over land situated near Potzlaka
Government Station, Lihir Island in the New Ireland Province,
PNG;
(b) Lease for Mining Purposes No 34 dated 21 July 1995 granted by the
PNG government to Southern Gold (Bahamas) Limited, Mineral
Resources Lihir Pty Limited and NML and transferred to the
Borrower on 15 February 1996 over land situated on Lihir Island,
in the New Ireland Province, PNG;
(c) Lease for Mining Purposes No 35 dated 21 July 1995 granted by the
PNG government to Southern Gold (Bahamas) Limited, Mineral
Resources Lihir Pty Limited and NML and transferred to the
Borrower on 15 December 1995 over land situated on Lihir Island,
in the New Ireland Province, PNG;
(d) Agricultural Lease Vol 4 Fol 109 dated 6 September 1993 granted
by the PNG government to Bali Corporation Limited and transferred
to the Borrower on 6 February 1996 over land known as Londolovit
Plantation being the whole of Portion No. 717 in the
Administrative District of New Ireland situated on the east coast
of Lihir Island;
8
(e) Agricultural Lease Vol 6 Fol 67 dated 30 May 1935 granted by the
PNG government to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and transferred to
the Borrower on 7 March 1996 over land known as Londolovit being
the whole of Portion No. 422 in the Administrative District of
New Ireland situated on the east coast of Lihir Island.
LOSS includes any consequential loss, and any costs, liability, claim,
suit, proceeding, cause of action, demand or action.
MAJORITY FINANCIERS has the meaning given in the Syndicated Facility
Agreement.
MAJORITY SENIOR BENEFICIARIES means at any time:
(a) if the Termination Date has not occurred, the Majority
Financiers;
(b) if the Termination Date has occurred but there is at the time,
existing Refinancing Debt, then until that Refinancing Debt is
Finally Paid, the "Majority Financiers" (howsoever described)
under the agreement which documents the Refinancing Debt;
(c) otherwise, Senior Beneficiaries whose Exposures under the Senior
Finance Documents exceeds 66% of the Aggregate Senior Exposure at
that time.
MATERIAL ADVERSE EFFECT means a material adverse effect either on the
ability of the Borrower to meet its payment obligations under the
Security Documents or on the value of the assets secured by the
Security Documents (other than through mining operations, as
contemplated by any current annual mine plan).
MINE means the Lihir gold mine and associated infrastructure.
MINING DEVELOPMENT CONTRACT means the Mining Development Contract
dated 17 March 1995 between The Independent State of Papua New Guinea
and the Borrower.
MORTGAGED AGREEMENT has the meaning given to that term in a Security
Document.
PERMITTED PAYMENTS means withdrawals from the Off-shore Account (as
defined in the Syndicated Facility Agreement) which the Borrower is
permitted to make pursuant to the Syndicated Facility Agreement and
from any bank accounts which are not subject to the Security
Documents.
PNG means The Independent State of Papua New Guinea.
9
POLITICAL RISK INSURANCE POLICY means:
(a) a political risk insurance policy issued by a Political Risk
Insurer in favour of the Financiers in connection with the
Syndicated Facility Agreement; or
(b) a political risk insurance policy issued by a Political Risk
Insurer in favour of any Hedge Counterparty on account of its
Hedge Contracts.
POLITICAL RISK INSURER means any political risk insurer under a
Political Risk Insurance Policy.
POTENTIAL EVENT OF DEFAULT means an event which, with the giving of
notice or lapse of time, would become an Event of Default.
RECOVERED MONEY means;
(a) the aggregate amount received in accordance with clause 11 which
has not been distributed under this deed; and
(b) all amounts received or recovered by a Beneficiary on or after
the Enforcement Date other than pursuant to clause 11.
RECOVERED MONEY DISTRIBUTION DATE means a day on which Recovered Money
is available for distribution in accordance with clause 11.
REFINANCING COORDINATION DEED means the deed so entitled between the
Borrower, UBS AG, UBS Australia Limited, the Facility Agent, the
Security Trustee and others dated on or about the date of this deed.
REFINANCING DEBT means any Indebtedness the purpose of which is to
refinance and replace the whole or any portion of the Senior Debt due
or which may be due under the Syndicated Facility Agreement provided
Refinancing Debt may not exceed US$50,000,000.
REIMBURSEMENT PROVISION means a provision in any Security which
entitles the Security Trustee to be reimbursed by the Borrower for
fees, costs, charges and expenses incurred by it in connection with a
Security Trustee Document.
RELATED ENTITY has the meaning it has in the Corporations Act.
REPRESENTATIVE of a person means any director, officer, delegate or
agent of that person.
SECURED PROPERTY has the meaning given to that term in a Security
Document.
SECURITY DOCUMENTS means:
(a) this deed;
10
(b) the deed entitled "Lihir Gold Deed of Security (PNG)" dated on or
about the date of this deed between the Borrower and the Security
Trustee under which the Borrower grants security over its assets
in PNG;
(c) the mortgages dated on or about the date of this deed granted by
the Borrower in favour of the Security Trustee over, among other
things, the agricultural leases of the land known as Londolovit
Plantation in the Province of New Ireland, PNG;
(d) the Deed of Charge (Existing Australian assets) dated on or about
the date of this deed between the Borrower and the Security
Trustee;
(e) the Deed of Charge (Future Australian assets) dated on or about
the date of this deed between the Borrower and the Security
Trustee;
(f) the Offshore Charge dated on or about the date of this deed
between the Borrower and the Security Trustee under which the
Borrower grants security over its assets located outside PNG and
Australia; and
(g) all further assurances in relation to any of paragraphs (a) to
(f) above.
SECURED MONEY has the meaning given to that term in a Security.
SECURITY INTEREST means:
(a) any bill of sale (as defined in any statute), mortgage, charge,
lien, pledge, hypothecation, title retention arrangement, trust
or power, as or in effect as security for the payment of a
monetary obligation or the observance of any other obligation;
and
(b) any guarantee or indemnity.
SECURITY TRUSTEE DOCUMENTS means:
(a) this deed;
(b) each Security Document;
(c) each Accession Deed;
(d) the Refinancing Coordination Deed;
(e) any deed, agreement or other instrument under which a person
consents to the grant of any Security Interest in favour of the
Security Trustee acting as trustee under this deed;
(f) any other document, deed or agreement (including, without
limitation, any consent, tripartite agreement, subordination
arrangement, intercreditor or priority arrangement) which the
11
Borrower and the Security Trustee (acting on the instructions of
the Majority Senior Beneficiaries) designate as a "Security
Trustee Document"; and
(g) any instrument connected with any of (a)-(f) above to which the
Security Trustee is a party.
SENIOR BENEFICIARIES means:
(a) the Security Trustee;
(b) the Facility Agent;
(c) each Financier;
(d) each Hedge Counterparty;
(e) a Political Risk Insurer, following compliance with clause 7, to
the extent of any Insurance Payment under a Hedge PRI; and
(f) any other person who proposes to provide or is providing
financial accommodation or hedging under a Senior Finance
Document.
Subject to the appointment of a successor Security Trustee if required
under clause 10, when all Secured Money due and owing to the persons
listed in paragraphs (a) to (e) inclusive has been Finally Paid, the
term "Senior Beneficiary" will include the Junior Beneficiary and
exclude the Facility Agent, each Financier and each Hedge
Counterparty.
SENIOR DEBT means any amount actually or contingently owing under or
in connection with the Senior Finance Documents, whether or not then
due and payable.
SENIOR FINANCE DOCUMENT means each of:
(a) each Security Trustee Document;
(b) the Syndicated Facility Agreement;
(c) each Hedge Contract;
(d) any deed, agreement or other instrument under which Refinancing
Debt is or is to be provided to the Borrower; and
(e) any deed, agreement or other instrument designated as a Senior
Finance Document in an Accession Deed.
SHARE means:
(a) in respect of a Senior Beneficiary and a day, the same proportion
(expressed as a percentage (rounded (if necessary) to the nearest
two decimal places)) as the proportion which the Exposure of that
Senior Beneficiary under the Senior Finance
12
Documents on that day bears to the Aggregate Senior Exposure on
that day; and
(b) in respect of a Junior Beneficiary and a day, the same proportion
(expressed as a percentage (rounded (if necessary) to the nearest
two decimal places)) as the proportion which the Exposure of that
Junior Beneficiary under the Junior Finance Documents on that day
bears to the sum of all Exposures on that day to all Junior
Beneficiaries under all Junior Finance Documents on that day.
SURETY means a person (other than the Borrower) which at any time is
liable by guarantee or otherwise alone or jointly, or jointly and
severally, to pay or indemnify against non-payment of the Senior Debt
or Junior Debt.
SYNDICATED FACILITY AGREEMENT means:
(a) prior to the Effective Time, the agreement entitled "Syndicated
Facility Agreement" dated 22 November 2000 between the Borrower,
ABN AMRO Australia Limited as Facility Agent, the Financiers
named in the schedule thereto and others; and
(b) on and after the Effective Time, the agreement entitled
"Syndicated Facilities Agreement" dated on or about the date of
the initial amendment of this deed between the Borrower, ABN AMRO
Australia Limited as Facility Agent, the Financiers named in
schedule 1 thereto and others.
TAXES means taxes, levies, imposts, charges and duties imposed by any
authority (including stamp and transaction duties) together with any
related interest, penalties, fines and expenses in connection with
them, except if imposed on the overall net income of a Beneficiary.
TERMINATION DATE means the date on which the Facility Agent has
confirmed in writing to the Borrower that all moneys owing under the
Syndicated Facility Agreement have been fully and finally discharged
and that none of the Financiers have any actual or contingent
obligations under the Syndicated Facility Agreement.
TRANSACTION has the meaning given in the ISDA Master Agreement.
TRUST FUND means the amount held by the Security Trustee under clause
2.1 together with any other property which the Security Trustee
acquires to hold on the trusts of this deed including, without
limitation, any Security Interest which it executes after the date of
this deed in its capacity as trustee of the trust established under
this deed and any property which represents the proceeds of sale of
any such property or proceeds of enforcement of any Security Interest.
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INTERPRETATION
1.2 In this deed, unless the contrary intention appears:
(a) a reference to this deed or another instrument includes any
variation or replacement of any of them;
(b) a reference to a statute, ordinance, code or other law includes
regulations and other instruments under it and consolidations,
amendments, re-enactments or replacements of any of them;
(c) the singular includes the plural and vice versa;
(d) the word "person" includes a firm, an entity, an unincorporated
association or an authority;
(e) a reference to a person includes a reference to the person's
executors, administrators, successors, substitutes (including,
without limitation, persons taking by novation) and assigns;
(f) a reference to "$", "US$" or "US Dollars" is a reference to the
lawful currency of the United States of America;
(g) an agreement, representation or warranty on the part of or in
favour of two or more persons binds or is for the benefit of them
jointly and severally but an agreement or warranty of a
Beneficiary or the Beneficiaries binds that Beneficiary or
Beneficiaries severally only; and
(h) a reference to any thing (including without limitation, any
amount) is a reference to the whole and each part of it and a
reference to a group of persons is a reference to all of them
collectively, to any two or more of them collectively and to each
of them individually.
HEADINGS
1.3 Headings are inserted for convenience and do not affect the
interpretation of this deed.
FACILITY AGENT
1.4 The Facility Agent enters into this deed in its capacity as Facility
Agent for and on behalf of the Financiers as at the date of this deed
or those persons who will become Financiers at about the Effective
Time (as defined in the Refinancing Coordination Deed) so as to bind
itself and such parties.
LIMITATION OF LIABILITY
1.5 The Borrower and each Beneficiary acknowledge that the Security
Trustee enters into the Security Trustee Documents (other than this
deed) solely in its capacity as security trustee under this deed and
that any rights which they may have against the Security Trustee under
or in respect of those Security Trustee Documents are not against the
Security Trustee personally but against the Security Trustee solely in
its capacity as trustee of the trust constituted under this deed. The
Security Trustee may not be called on or be liable to satisfy any such
14
rights out of any of its personal assets, and recourse against the
Security Trustee is limited to the assets held by it in its capacity
as trustee of the trust constituted under this deed.
CALCULATION OF CLOSE-OUT AMOUNTS UNDER HEDGE CONTRACTS
1.6 For the purpose of calculating the close-out amount in the definition
of Hedge Exposure, the parties agree:
(a) prior to close out and termination of a Hedge Transaction, the
calculation will be performed on the relevant date on a net basis
as if the Hedge Transaction was closed out and terminated and the
Settlement Amount was calculated under section 6(e)(i)(3) of the
ISDA Master Agreement (unless the agreement nominates section
6(e)(i)(4) of the ISDA Master Agreement to apply on termination
resulting from an Event of Default, in which event that provision
will apply) based on the assumptions that:
(i) that day is an Early Termination Date;
(ii) the relevant Hedge Counterparty is the Non-Defaulting Party;
(iii) all Hedge Transactions entered into with that Hedge
Counterparty are the Terminated Transactions; and
(iv) the Borrower and the Hedge Counterparty have not entered
into any Transactions other than Hedge Transactions,
where the expressions "Event of Default", "Settlement Amount",
"Early Termination Date", "Non-Defaulting Party" and "Terminated
Transactions" have the meaning given to those expressions in the
ISDA Master Agreement; and
(b) on and after close out and termination of a Hedge Transaction,
the calculation will be made under section 6(e)(i)(3) of the ISDA
Master Agreement if the termination results from an Event of
Default (unless the agreement nominates section 6(e)(i)(4) of the
ISDA Master Agreement to apply on termination, in which event
that provision will apply) or if the termination results from a
Termination Event (as defined in the ISDA Master Agreement),
under section 6(e)(ii) thereunder.
2 DECLARATION OF TRUST
DECLARATION OF TRUST
2.1 The Security Trustee declares that it holds the sum of A$10 and will
hold the Trust Fund on trust at any time for itself and the persons
who are Beneficiaries at that time.
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TERMINATION OF TRUST
2.2 The trust established under this deed commences on the date of this
deed and unless determined earlier is to end on the day prior to the
eightieth anniversary of the date of this deed.
NAME OF TRUST
2.3 The trust established under this deed is to be known as the Lihir Gold
Security Trust.
PAYMENT OF SECURED MONEY
2.4 The Borrower agrees to pay the Secured Money to the Security Trustee
in the currency in which it is due at or before 11:00 am (Sydney time)
on the due date for that payment by electronic funds transfer or other
satisfactory method of payment to the Security Trustee's US Dollar
bank account specified below or such other account as notified in
writing by the Security Trustee to the Borrower.
Bank: ABN AMRO Bank N.V.
Swift Code ▇▇▇▇▇▇▇▇
Favouree: ABN AMRO Australia Limited OBU
Account
Swift: ABNAAU2SOBU
Account Number: ▇▇▇-▇▇▇-▇▇▇▇▇▇
2.5 Despite any other provision in any Finance Document to the contrary,
the Borrower must pay or repay the Secured Money as follows:
(a) on and after the Enforcement Date, to the Security Trustee or
otherwise as directed by the Security Trustee; and
(b) otherwise, to the relevant Beneficiary in accordance with the
terms of the relevant Finance Document.
2.6 Payment by the Borrower of Secured Money to a Beneficiary pursuant to
clause 2.5(a) or to the Security Trustee pursuant to clause 2.5(b)
will, to the extent it is Finally Paid, operate in satisfaction of the
obligation of that Borrower to pay the amount to the Beneficiary or to
the Security Trustee respectively.
MANNER OF PAYMENT
2.7 The Borrower agrees to make all payments to the Security Trustee under
this deed in Immediately Available Funds to the account and in the
manner notified by the Security Trustee to the Borrower.
2.8 The Borrower agrees to make payments without set-off or counterclaim
and free and clear of any withholding or deduction for Taxes unless
prohibited by law.
CURRENCY OF PAYMENT
2.9 If an amount is due in a currency and the Security Trustee receives
payment in another currency, then the Security Trustee may convert the
amount received into the due currency at the spot rate at which the
Security Trustee is able to purchase the due currency with the amount
received at the time of its receipt. The Borrower satisfies its
obligation
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to pay in the due currency only to the extent of the amount of the due
currency purchased after deducting the costs of conversion. The
Borrower acknowledges that it may be necessary for the Security
Trustee to convert amounts received through a currency other than the
due currency to ascertain the equivalent in the due currency of the
amount received.
TAXES
2.10 If a law requires the Borrower to withhold or deduct Taxes from a
payment so that the Security Trustee would not actually receive for
its own benefit on the due date the full amount provided for under
this deed, then:
(a) the amount payable is increased so that, after making that
deduction and deductions applicable to additional amounts
payable, under this clause, the Security Trustee is entitled to
receive the amount, it would have received if no deductions had
been required; and
(b) the Borrower must make the deductions; and
(c) the Borrower must pay the full amount deducted, to the relevant
authority in accordance with applicable law and deliver the
original receipts to the Security Trustee.
GST GROSS UP
2.11 If any party:
(a) is liable to pay GST on a supply made in connection with the
Security Trustee Documents; and
(b) certifies to the recipient of the supply that it has not priced
the supply to include GST,
then the recipient of the supply agrees to pay that party an
additional amount equal to the consideration payable for the supply
multiplied by the prevailing GST rate.
2.12 This clause 2.12 applies if the actual amount of GST paid or payable
by the supplier on a supply made in connection with the Security
Trustee Documents is less than the amount paid by the recipient of the
supply under clause 2.11. In that case, the supplier agrees to refund
the difference to the recipient of the supply. The supplier agrees to
make the refund as soon as practicable after the actual amount of GST
on the supply is paid or can be clearly ascertained by the supplier.
3 DUTIES, POWERS AND RIGHTS OF SECURITY TRUSTEE
AUTHORITY OF SECURITY TRUSTEE
3.1 The Security Trustee is appointed to enter into and act as trustee for
the Beneficiaries under the Security Trustee Documents. The Security
Trustee accepts this appointment.
17
EXTENT OF AUTHORITY AND OBLIGATIONS
3.2 Each Beneficiary irrevocably authorises the Security Trustee to:
(a) enter into the Security Trustee Documents (other than this deed);
and
(b) take action on the Beneficiary's behalf in accordance with this
deed; and
(c) exercise their respective rights expressly set out in the
Security Trustee Documents and rights, powers and discretions
reasonably incidental to them and carry out their respective
obligations expressly set out in the Security Trustee Documents.
The Beneficiaries acknowledge that the Security Trustee's obligations
are those expressly set out in the Security Trustee Documents.
BINDING NATURE OF RELATIONSHIP
3.3 Each Beneficiary agrees:
(a) to be bound by anything properly done or properly not done by the
Security Trustee in accordance with the Security Trustee
Documents, whether or not on instructions, and whether or not the
Beneficiary gave an instruction or approved of the thing done or
not done; and
(b) to ratify anything properly done or properly not done by the
Security Trustee in accordance with this deed.
EXCLUDED ROLES AND DUTIES
3.4 The appointment as security trustee does not mean that the Security
Trustee, as the case may be:
(a) is a trustee for the benefit of; or
(b) is a partner of; or
(c) has a fiduciary duty to, or other fiduciary relationship with,
any Beneficiary, the Borrower or any other person, except as expressly
set out in any Security Trustee Document.
POWER OF THE SECURITY TRUSTEE
3.5 The Security Trustee has the rights, discretions and powers delegated
to it under this deed, and all other powers reasonably incidental to
them.
INSTRUCTIONS, EXTENT OF DISCRETIONS
3.6 (a) If the Security Trustee proposes to act on any of the matters
described in clause 3.7 or 3.8, it agrees to:
(i) consult the Senior Beneficiaries on the proposal; and
18
(ii) take action if, and only if, it receives instructions to do
so from:
(A) all the Senior Beneficiaries - on matters listed in
clause 3.8;
(B) the Majority Senior Beneficiaries - on matters listed
in clause 3.7.
(b) Subject to paragraph (a) above and except in respect of amounts
due to the Security Trustee in its own right, the Security
Trustee agrees, in relation to the Security Trustee Documents,
to:
(i) act in accordance with the instructions of the Majority
Senior Beneficiaries; and
(ii) refrain from exercising a Right vested in it in its capacity
as agent under this agreement if so instructed by the
Majority Senior Beneficiaries.
Any such instructions of the Majority Senior Beneficiaries or all
Senior Beneficiaries are binding on all Beneficiaries.
(c) The Security Trustee may refrain from exercising any right vested
in it under the Security Trustee Documents until it has received
instructions from the Majority Senior Beneficiaries as to whether
it is to be exercised and, if applicable, the way in which it is
to be exercised.
(d) If the Security Trustee does not require instructions pursuant to
paragraph (a) above or does not receive instructions or requests
under paragraph (b) above, the Security Trustee may (but is not
obliged to) act as it considers to be in the best interests of
all the Senior Beneficiaries. It need not consult any
Beneficiaries before doing so. Any action taken by the Security
Trustee under this paragraph binds all Beneficiaries. The
Security Trustee agrees to give details to the Beneficiaries of
any material action taken under this paragraph.
(e) If:
(i) the Security Trustee specifies in its notice seeking
instructions that the "guillotine procedure" applies to that
particular set of instructions; and
(ii) a Beneficiary does not give instructions in relation to
action proposed by the Security Trustee within any time
period specified by the Security Trustee in the notice,
the Beneficiary is taken to have instructed the Security Trustee
to take the proposed action.
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MAJORITY SENIOR BENEFICIARIES
3.7 The Security Trustee may not:
(a) exercise in its capacity as Security Trustee a right, power or
discretion delegated to or conferred on it under any clause of a
Security Trustee Document which expressly refers to such exercise
being subject to the consent or approval of the Majority Senior
Beneficiaries; or
(b) appoint or take steps to appoint any person as a receiver or
receiver and manager in respect of the Secured Property or take
steps to assume possession (whether personally or through an
agent) of the Secured Property as mortgagee in possession or
otherwise; or
(c) waive breaches of or otherwise excuse performance of any
obligation of the Borrower under any Security Trustee Document;
or
(d) give an Acceleration Notice to any Beneficiary; or
(e) give any approvals or consents under clause 4; or
(f) subject to clause 3.8, agree to vary a Security Trustee Document,
without in any such case the instructions of a Majority Senior
Beneficiaries or, in the case of agreeing any amendment to this deed,
without the consent of all Beneficiaries. The Security Trustee must
exercise such a right, power or discretion and must so waive or excuse
performance if so instructed by the Majority Senior Beneficiaries.
UNANIMOUS CONSENT OF SENIOR BENEFICIARIES
3.8 The Security Trustee may not agree to release a Security (in whole or
in part) unless required to do so by that Security or by law without
the consent of all existing Senior Beneficiaries.
▇▇▇▇▇▇▇▇ NOT TO INVESTIGATE AUTHORITY
3.9 The Borrower need not inquire whether any instructions have been given
to the Security Trustee by the Majority Senior Beneficiaries or all
Senior Beneficiaries or as to the terms of those instructions. As
between the Borrower and the Beneficiaries, all action taken by the
Security Trustee under a Security Trustee Document will be taken to be
authorised.
LIMITS ON DUTIES OF SECURITY TRUSTEE
3.10 The Security Trustee has no duty to:
(a) (NO OBLIGATION TO ACT UNLESS INDEMNIFIED) exercise any right it
may have as a result of an Event of Default, unless it is put in
funds and/or is indemnified to its reasonable satisfaction;
(b) (NO OBLIGATION TO PROVIDE INFORMATION) provide any Beneficiary
(or any other person) with any credit or other
20
information concerning the affairs, financial condition or
business of the Borrower which may come into its possession as
Security Trustee, except as stated in clause 3.16;
(c) (NO ACTION PENDING DIRECTION) exercise any right, if it has
sought instructions under clause 3.6 as to whether it should
exercise, or as to the manner of exercise, of the right, pending
its receipt of those instructions (notwithstanding any other
provision of a Security Trustee Document which imposes a duty on
it to do so); or
(d) (DEFECTS IN TITLE) enquire whether there is, or seek perfection
of, a defect in title of either the Borrower to any Secured
Property or of the Security Trustee in relation to its interest
in the Secured Property unless (in the context of any particular
defect) it is directed to do so by a Majority Senior
Beneficiaries.
NOTICE OF EVENT OF DEFAULT
3.11 The Security Trustee is not to be regarded as having knowledge of the
occurrence of an Event of Default or a Potential Event of Default
unless it receives notice from another Beneficiary or the Borrower
stating that such an event has occurred and is given reasonable
particulars.
NO REPRESENTATION BY SECURITY TRUSTEE
3.12 The Facility Agent and each other Beneficiary acknowledge that the
Security Trustee has made no representation or given any warranty upon
which it has relied, except to the extent expressly set out in this
deed.
NO INDIVIDUAL ENFORCEMENT BY BENEFICIARIES
3.13 No Senior Beneficiary may take any Enforcement Action or exercise any
right, power or discretion under the Security Trustee Documents unless
the Security Trustee has been instructed to exercise that right, power
or discretion by the Majority Senior Beneficiaries or all Senior
Beneficiaries, as the case may be, and fails to do so within a
reasonable time. In any event, no Senior Beneficiary may take any
Enforcement Action without the concurrence of the Majority Senior
Beneficiaries.
RELIANCE ON DOCUMENTS AND EXPERTS
3.14 The Security Trustee may rely on:
(a) any document (including any facsimile transmission, telegram or
telex) believed by it to be genuine and correct; and
(b) advice and statements of lawyers, independent accounts and other
experts selected by the Security Trustee.
SECURITY TRUSTEE'S OBLIGATIONS
3.15 The Security Trustee agrees:
21
(a) (DEFAULT AND REVIEW) to notify the Beneficiaries of an Event of
Default or Potential Event of Default promptly after the Security
Trustee becomes aware of it; and
(b) (MATERIAL NOTICES RECEIVED) to give the Beneficiaries promptly
after receiving it a copy of each notice or other communication
or document which the Security Trustee receives in connection
with a Finance Document and which the Security Trustee considers
material; and
(c) (ACTION TAKEN) to give the Beneficiaries promptly a report on
anything done following directions from the Beneficiaries.
NO FURTHER OBLIGATIONS
3.16 The Beneficiaries agree that the Security Trustee has no other
obligations, other than those in clause 3.15 either initially or on a
continuing basis:
(a) to keep itself informed, or to inform a Beneficiary, about the
performance by the Borrower of its obligations under the Security
Trustee Documents; or
(b) to provide a Beneficiary with any information or documents with
respect to the Borrower (whether coming into its possession
before or after accommodation is provided under the Security
Trustee Documents).
ASSUMING COMPLIANCE
3.17 Until it becomes aware in accordance with clause 3.11, the Security
Trustee may assume that no Event of Default or Potential Event of
Default has occurred and that the Borrower is observing all its
obligations in connection with the Security Trustee Documents and need
not inquire whether that is, in fact, the case.
LIMIT ON DISCLOSURE OBLIGATIONS
3.18 Despite anything else in this deed, this deed does not oblige the
Security Trustee, to disclose information or provide documents
relating to the Borrower or any other person if the Security Trustee,
reasonably believes that to do so would constitute a breach of law or
duty of confidentiality.
EXONERATION
3.19 Neither the Security Trustee nor any of its directors, officers,
employees, agents, attorneys or Related Entities is responsible or
liable to any Beneficiary:
(a) because the Borrower does not perform its obligations under the
Finance Documents; or
(b) for the financial condition of the Borrower; or
(c) because any statement, representation or warranty in a Finance
Document is incorrect or misleading; or
22
(d) for the effectiveness, genuineness, validity, enforceability,
admissibility in evidence or sufficiency of the Finance Documents
or any document signed or delivered in connection with the
Finance Documents; or
(e) for acting or not acting in accordance with the instructions of
the Majority Beneficiaries or all the Senior Beneficiaries, or in
accordance with their directions, as the case may be.
Without limiting this clause 3.19, the Security Trustee is not
responsible or liable to any Beneficiary for anything done or not done
in connection with the Finance Documents by the Security Trustee or
its directors, officers, employees, agents, attorneys or Related
Entities except to the extent that the act or omission amounts to
fraud, gross negligence or wilful misconduct by the Security Trustee,
as the case may be, or a gross or wilful breach by them of their
obligations in the capacity of agent of the Beneficiaries or in the
capacity of security trustee, as the case may be.
SECURITY TRUSTEE IN CAPACITY OF A FINANCIER OR OTHER BENEFICIARY
3.20 If the Security Trustee is also a Beneficiary (otherwise than in its
capacity as Security Trustee), then in its capacity as a Beneficiary
it:
(a) has the same rights and obligations under the Finance Documents
as the other Beneficiaries; and
(b) may exercise those rights and agrees to comply with those
obligations independently from its role as Security Trustee as if
it were not the Security Trustee.
DEALING IN DIFFERENT CAPACITIES
3.21 The Security Trustee may:
(a) engage in any kind of banking, trust or other business with the
Borrower or the Beneficiaries or any of their Related Entities;
and
(b) accept fees and other consideration from the Borrower or any of
the Borrower's Related Entities for services in connection with
the Finance Documents or any other arrangement,
as if it were not the Security Trustee and without having to account
to the Beneficiaries for any income it derives in doing so.
The Beneficiaries release the Security Trustee from any obligation
they might otherwise have to the Beneficiaries in relation to these
matters.
DELEGATION BY SECURITY TRUSTEE
3.22 The Security Trustee may employ agents and attorneys and may delegate
any of their rights or obligations in the capacity as security trustee
under the Security Trust Deed, without notifying any person of the
delegation.
23
FORCE MAJEURE
3.23 Despite any other provision of this agreement, the Security Trustee
need not act (whether or not on instructions from one or more of the
Beneficiaries) if it is impossible to act due to any cause beyond its
control (including war, riot, natural disaster, labour dispute, or law
taking effect after the date of this agreement). The Security Trustee
agrees to notify each Beneficiary promptly after it determines that it
is unable to act.
NO RESPONSIBILITY FOR FORCE MAJEURE
3.24 The Security Trustee has no responsibility or liability for any loss
or expense suffered or incurred by any party as a result of its not
acting for so long as the impossibility under clause 3.23 continues.
However, the Security Trustee agrees to make reasonable efforts to
avoid or remove the causes of non-performance and agrees to continue
performance under this agreement promptly when the causes are removed.
FUNDS BEFORE ACTING
3.25 This clause applies if the Security Trustee proposes to exercise a
right arising in its capacity as Security Trustee of the Beneficiaries
or take any other action (whether or not at the instruction of the
Majority Senior Beneficiaries or all Senior Beneficiaries) or the
Security Trustee is directed to exercise a right or take any action in
its capacity as security trustee in connection with the Security
Trustee Documents, and the Security Trustee reasonably considers this
could result in the Beneficiaries becoming obliged to pay an amount
under clause 3.27. In that case, the Security Trustee:
(a) may request the Senior Beneficiaries to pay to it an amount at
least equal to the amount the Security Trustee reasonably
determines would be the Senior Beneficiary's liability; and
(b) need not act until the Senior Beneficiaries do so.
Each Senior Beneficiary agrees to fund under this clause rateably in
accordance with its Share.
IF A BENEFICIARY DOES NOT FUND
3.26 If a Beneficiary does not fund the Security Trustee as required under
clause 3.25 within a period determined Security Trustee to be
reasonable, then the Security Trustee agrees to promptly request each
other Beneficiary to fund the defaulting Beneficiary's share. If one
or more other Beneficiary agrees to fund the defaulting Beneficiary's
share, then the obligations of the Beneficiaries under clause 3.25 are
taken to be satisfied. Each Beneficiary agrees that:
(a) a payment by a Beneficiary to the Security Trustee under this
clause 3.26 constitutes a loan by the Beneficiary to the
defaulting Beneficiary; and
(b) the loan accrues interest at the rate and in the manner notified
by the paying Beneficiary to the defaulting Beneficiary and the
Security Trustee.
24
The defaulting Beneficiary agrees to pay to the Security Trustee (for
the account of each funding Beneficiary) on demand from the
Beneficiary the loan principal and interest on each loan.
INDEMNITY TO SECURITY TRUSTEE
3.27 Each Senior Beneficiary, rateably in accordance with its Exposure,
will indemnify the Security Trustee, on demand, against any Loss
suffered or incurred by the Security Trustee as a result of, in
connection with or in contemplation of:
(a) the stamping and registration of the Security Trustee Documents;
(b) the exercise, enforcement or preservation, or attempted exercise,
enforcement or preservation, of any of its rights as Security
Trustee;
(c) the performance or purported performance of its duties under the
Security Trustee Documents;
(d) any action or omission by the Security Trustee under (or
purportedly under) any Security Trustee Document; or
(e) anything done or not done by the Security Trustee pursuant to any
direction or authorisation of the Majority Senior Beneficiaries.
This includes, in each case, the fees and expenses on a full indemnity
basis of legal and other professional advisers.
This clause does not apply to the extent that:
(i) the Security Trustee is reimbursed on demand by the Borrower for
any cost or expense incurred or payable by the Security Trustee;
or
(ii) the relevant Loss was suffered or incurred as a direct result of
the Security Trustee's fraud, negligence or wilful misconduct.
Each Authorised Officer, agent, employee, adviser or consultant of the
Security Trustee is entitled to the benefit of this clause 3.27. The
Security Trustee holds that benefit on their behalf.
REMOVAL OF SECURITY TRUSTEE
3.28 The Majority Senior Beneficiaries may remove the Security Trustee from
office, in each case by notice given to the Security Trustee, if:
(a) the Security Trustee becomes insolvent; or
(b) the Security Trustee is guilty of negligence or wilful misconduct
in the discharge of its duties as trustee of the Trust Fund; or
25
(c) the Security Trustee breaches any material obligation under a
Security Trustee Document and does not correct that breach within
a reasonable time; or
(d) the Borrower so requests on the grounds that the Security Trustee
will cease or has ceased to be a Senior Beneficiary (other than
in its capacity as Security Trustee).
Subject to clause 3.31, removal of the Security Trustee from office
will take effect:
(i) (if notice of removal is given pursuant to paragraph (a)): when
the notice is given; or
(ii) (in any other case): 20 Business Days after the notice of removal
is given to the Security Trustee by or on behalf of the Majority
Senior Beneficiaries.
RETIREMENT
3.29 The Security Trustee may retire as Security Trustee by giving to the
Borrower and each other Senior Beneficiary not less than 30 days'
notice of its intention to do so. No retirement takes effect unless:
(a) there has been appointed as a successor Security Trustee approved
by the Borrower (which approval may not be unreasonably withheld
or delayed) either:
(i) a Beneficiary nominated by the Majority Senior Beneficiaries
or, failing such a nomination;
(ii) a reputable and experienced bank or financial institution
nominated by the Security Trustee; and
(b) the successor Security Trustee has obtained title to or obtained
benefit of each Security in its capacity as Security Trustee in a
manner approved by each Senior Beneficiary.
3.30 Subject to clause 3.31, when a successor Security Trustee is
appointed, the retiring or removed Security Trustee is discharged
(without prejudice to any accrued right or obligation) from any
further obligation under the Finance Documents. The new Security
Trustee and each other party to the Finance Documents has the same
rights and obligations among themselves as they would have had if the
new Security Trustee had been a party to the Finance Documents.
3.31 The retiring or removed Security Trustee agrees, at the Borrower's
expense (where clause 3.28(d) applies) and otherwise at its own
expense, to execute and cause its successors to execute documents and
do everything else necessary or appropriate to transfer the Trust Fund
into the name of the new Security Trustee and to ensure that all
public registers record the new Security Trustee as the trustee of the
Trust Fund.
26
SECURITY TRUSTEE FEE
3.32 If the Termination Date occurs, the Borrower agrees to pay the
Security Trustee an annual fee to be agreed between the Security
Trustee and the Borrower and failing such agreement, such fee as
designated by the Security Trustee and which must not exceed the fee
being received at that time under clause 5.3 of the Syndicated
Facility Agreement.
4 SUBORDINATION
CLAUSES 4.1-4.10 (INCLUSIVE) AND CLAUSES 4.15-4.19 (INCLUSIVE) HAVE NO FURTHER
APPLICATION AFTER THE TERMINATION DATE UNLESS OTHERWISE AGREED BY THE JUNIOR
CREDITORS.
SUBORDINATION
4.1 Despite any other agreement between a Junior Creditor and the Borrower
but except as permitted by clauses 4.6 and 4.7, each party agrees with
each other party that no part of the Junior Debt is due for payment or
capable of being declared due for payment unless:
(a) the Senior Debt is satisfied or repaid in full; or
(b) an Event occurs; or
(c) that Junior Debt is refinanced by other Junior Debt and the
refinancing party has agreed to be bound under this deed as a
Junior Creditor.
RIGHTS AND OBLIGATIONS FOLLOWING AN EVENT
4.2 If an Event occurs, then the Junior Debt is payable immediately.
4.3 If an Event occurs, then each Junior Creditor agrees, on request from
the Security Trustee, to:
(a) prove for the whole of its Junior Debt which is not recoverable
from the Security; and
(b) immediately send to the Security Trustee a copy of its notice of
proof.
4.4 A Junior Creditor may not prove for its Junior Debt except following a
request from the Security Trustee under clause 4.3.
4.5 If:
(a) a Junior Creditor receives or recovers any money on account of
that Junior Beneficiary's Junior Debt; or
(b) any amount is paid to any person in connection with that Junior
Creditor's Junior Debt (including, without limitation, to an
assignee of that Junior Creditor's Junior Debt),
whether by way of repayment, satisfaction or otherwise and whether
from the Borrower or from any other person (including, without
limitation, a liquidator, provisional liquidator or administrator of
the
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Borrower), other than by way of Permitted Payments ("PROCEEDS"), then
that Junior Creditor agrees:
(c) to notify the Security Trustee promptly;
(d) to hold the Proceeds and the undertakings in this clause 4.5 on
trust for the Beneficiaries and to apply the same:
(i) first, towards satisfaction of the Senior Debt under the
Syndicated Facility Agreement;
(ii) secondly, towards satisfaction of its Junior Debt; and
(e) upon demand, to pay the Proceeds forthwith to the Security
Trustee for the account of the Financiers.
JUNIOR CREDITOR UNDERTAKINGS
4.6 A Junior Creditor may not, without the consent of the Security Trustee
(acting on the instructions of the Majority Senior Beneficiaries) or,
if an Event of Default under the Syndicated Facility Agreement is
subsisting, except as directed by the Security Trustee:
(a) directly or indirectly demand payment of, sue for, accept payment
or repayment of or in any way allow by reduction of the
Borrower's assets or otherwise, the discharge, satisfaction or
extinguishment of its Junior Debt (other than by way of Permitted
Payments); or
(b) novate or replace any of its rights (or agree to do any of these
things) under any Junior Finance Document unless the novatee or
replacement financier accedes to this deed as a Junior Creditor;
or
(c) set off its Junior Debt against any Indebtedness of the Junior
Creditor to the Borrower; or
(d) assign, charge or otherwise deal with its Junior Debt; or
(e) suffer to exist or take a Security Interest (other than under
Security Trustee Documents) to secure payment of its Junior Debt
other than any guarantee existing as at the date of this deed; or
(f) convert any Junior Debt into shares in the Borrower; or
(g) take any form of Enforcement Action (including taking steps
towards, or voting for the winding up, administration or
provisional liquidation of the Borrower).
PERMITTED PAYMENTS
4.7 So long as:
(a) no Senior Debt owing to a Financier is due and payable but
unpaid; and
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(b) no Event of Default or Potential Event of Default has occurred
and is subsisting under the Syndicated Facility Agreement,
then to the extent such payment is a Permitted Payment, the Borrower
may pay, satisfy or discharge, and the Junior Creditor may receive and
retain, payment of interest and principal on the Junior Debt in
accordance with, and in the amounts contemplated by, the terms of the
Junior Finance Documents and the Junior Creditor, (as the case may be)
may make demands in respect of, or so as to establish a liability to
pay, any amount so permitted to be paid.
BORROWER
4.8 The Borrower may not, without the consent of the Majority Senior
Beneficiaries:
(a) give any guarantee to be given in respect of the Junior Debt; or
(b) grant a Security Interest (other than under Security Trustee
Documents) to secure payment of the Junior Debt; or
(c) directly pay (except for payments which constitute Permitted
Payments) or in any way reduce the Borrower's assets to discharge
the Junior Debt; or
(d) novate or replace any agreement or instrument under which the
Borrower's obligations in respect of the Junior Debt arise unless
the novatee or replacement financier accedes to this deed as a
Junior Creditor; or
(e) set off the Junior Debt against any Indebtedness of the Junior
Creditor to the Borrower; or
(f) enter into any arrangement which results in the Junior Debt not
being subordinated to the Senior Debt under the Syndicated
Facility Agreement; or
(g) create, grant, extend or permit to subsist or be imposed any
Security Interest ranking in priority to the Senior Debt.
4.9 The Borrower agrees to notify the Security Trustee immediately if it
receives a demand whether direct or indirect for payment of the Junior
Debt.
REVOCATION OF APPROVALS
4.10 Any approval given by the Security Trustee in connection with this
clause 4 immediately terminates if:
(a) a Junior Creditor or the Borrower defaults under this deed; or
(b) the Borrower is unable to pay its debts as they fall due; or
(c) an Event occurs.
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PRESERVATION OF SENIOR BENEFICIARY'S RIGHTS
4.11 No obligation of a Junior Creditor arising under this deed is released
or abrogated, prejudiced or affected by any act matter or thing that a
Senior Beneficiary may do or omit to do which but for this provision
would or might release abrogate prejudice or affect the obligations of
the Junior Beneficiary including, without limitation:
(a) the granting of time, credit or any indulgence or concession to
the Borrower or any Surety by a Security Trustee or a Senior
Beneficiary or by any compounding or compromise release
abandonment waiver variation relinquishment renewal or transfer
of any securities, documents of title, assets or any rights of a
Senior Beneficiary against the Borrower or any Surety of any
other person or by neglect or omission to enforce any such
rights;
(b) the liquidation, receivership or administration of the Borrower,
any Junior Creditor or any Surety, or any Junior Creditor or the
Borrower or any Surety entering into any compromise or assignment
of property or scheme of arrangement or composition of debts or
scheme of reconstruction;
(c) any person giving a guarantee or other Security Interest in
respect of all or any of the Senior Debt;
(d) failure by the Borrower or any Surety or any other person to
provide any Security Interest which ought to be provided or to
have been provided under any agreement in respect of all or any
part of the Senior Debt;
(e) any alteration, addition or variation to any agreement in respect
of all or any part of the Senior Debt;
(f) any Security Interest held or taken at any time by a Senior
Beneficiary for all or any part of the Senior Debt being void,
defective or informal;
(g) the Borrower or any Surety being discharged from its obligation
to pay all or any of the Senior Debt otherwise than by payment or
satisfaction of those moneys to a Senior Beneficiary; or
(h) a Junior Creditor being discharged from its obligations to a
Senior Beneficiary under this deed.
4.12 If a Senior Beneficiary holds any other Security Interest for or right
in respect of all or any of the Senior Debt, then:
(a) the Senior Beneficiary need not resort to that other Security
Interest or right before enforcing its rights under this deed;
and
(b) the liability of each Junior Creditor under this deed is not
affected by reason that the other Security Interest or right is
or may be wholly or partly void or unenforceable.
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4.13 This deed does not prejudicially affect and is not prejudicially
affected by any Security Interest or guarantee held by a Senior
Beneficiary either at the date of this deed or at any subsequent time.
4.14 Nothing contained in this deed, merges, discharges, extinguishes,
postpones, lessens or prejudices any Security Interest now held or
which may subsequently be held or taken by a Senior Beneficiary for
payment of any of the Senior Debt. Nor does this deed or any Security
Interest:
(a) affect:
(i) any right or remedy which the Senior Beneficiary now has or
subsequently may have or be entitled to by law, equity or
statute against any other person as surety or on any bill of
exchange, promissory note, letter of credit or other
negotiable instrument; or
(ii) security to the Senior Beneficiary for all or part of the
Senior Debt; or
(b) operate as a payment of the Senior Debt until the same has been
actually paid in cash.
Nothing in any Security Interest and no other right or remedy which a
Senior Beneficiary has or subsequently may have apart from this
agreement discharges, extinguishes, postpones, lessens or otherwise
prejudices this agreement. A Senior Beneficiary is not under any
obligation to resort to any Security Interest in priority to this
deed.
4.15 The subordination under this deed is a continuing subordination and
remains in full force until full and final discharge of the Senior
Debt.
CORPORATIONS ACT
4.16 This clause 4 is intended to operate as a "debt subordination" (as
defined in section 563C(2) of the Corporations Act) by each Junior
Creditor.
LIMITATION ON RIGHTS OF JUNIOR BENEFICIARIES
4.17 Each Junior Beneficiary acknowledges that until it becomes a Senior
Beneficiary, each of the Security Trustee and the other Senior
Beneficiaries may exercise all rights, powers and discretions under or
in respect of the Finance Documents as though the Junior Beneficiary
had no rights or interests in relation to the Borrower, the Secured
Property, or any Security or the property or assets subject to the
trust under this deed and were not a party to this deed.
ACKNOWLEDGMENT BY JUNIOR BENEFICIARIES AND JUNIOR CREDITORS
4.18 Without limitation, each of the Junior Beneficiaries and Junior
Creditors (each, a "JUNIOR PARTY") acknowledges that:
(a) the Junior Party has no rights in respect of any Security or the
proceeds of any Security except as set out in this deed or the
Securities;
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(b) the Junior Debt is subordinated to the Senior Debt in the manner
set out in clause 4;
(c) each of the Senior Beneficiaries owes no duty, obligations or
standard of care to the Junior Party. In particular, any
obligation or requirement in any Finance Document not to withhold
consent unreasonably or to form a reasonable opinion is not owed
to the Junior Party;
(d) the Security Trustee and the other Senior Beneficiaries in
enforcing any Finance Document are entitled to act entirely in
their own interests and are not required to consult with, or take
into account in any way, the interests of the Junior Party;
(e) the Security Trustee and the Senior Beneficiaries can agree to
include new Senior Beneficiaries without the Junior Party's
consent;
(f) the Security Trustee and the other Senior Beneficiaries may take
any action they see fit in their absolute discretion, even if it
would constitute a breach of a Junior Finance Document;
(g) the Junior Party consents to, and will be bound by, any action
taken at any time by the Security Trustee or any other Senior
Beneficiary in accordance with any Finance Document (including
any amendment to, or consent or waiver given under, any Finance
Document (excluding any amendment to this deed)); and
(h) consents and waivers by the Security Trustee acting pursuant to
clause 4, will bind each Junior Party, even if it is not a party
to it.
5 CHANGE IN BENEFICIARIES
CHANGE IN BENEFICIARIES
5.1 If a Beneficiary enters into any substitution, assignment or novation
procedure contemplated by another Finance Document, or wishes a person
(including a Political Risk Insurer) to be bound by the Security Trust
Deed, then:
(a) it must give a notice to the Security Trustee and the Borrower
(to be received by the Security Trustee and the Borrower at least
15 Business Days or such shorter period as agreed between the
Security Trustee and the Borrower before the substitution is to
take place) which specifies:
(i) the proposed substitute; and
(ii) the obligations which it wishes to have assumed by the
substitute; and
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(b) the Beneficiary and the substitute or the Political Risk Insurer
must, at the cost of the Beneficiary, execute Accession Deeds and
deliver four duly stamped (if applicable) original Accession
Deeds to the Security Trustee or otherwise become bound by this
deed in a form acceptable to the Security Trustee.
NEW BENEFICIARIES AND FINANCE DOCUMENTS
5.2 Subject to clause 5.3, the Borrower may, from time to time, request
that certain existing or proposed obligations (whether present or
future, actual, prospective or contingent) of the Borrower be
recognised as a Finance Document and if the obligee is not already a
Beneficiary, that the relevant obligee be recognised as a Beneficiary
in respect of that Finance Document by:
(a) delivering a request ("DESIGNATION NOTICE") to the Security
Trustee (in the form set out in schedule 1 or such other form as
approved by the Security Trustee);
(b) providing the Security Trustee with a certified copy of the
proposed Finance Document;
(c) providing such additional information or opinions as may be
reasonably requested by the Security Trustee in connection with
the new Beneficiary or proposed Finance Document; and
(d) providing the Security Trustee with four counterparts of an
Accession Deed duly stamped (if applicable) and duly executed by
the proposed new Beneficiary.
ONLY CERTAIN OBLIGATIONS ALLOWED
5.3 The Borrower may only deliver a Designation Notice under clause 5.2 if
the obligations under the proposed Finance Document constitutes:
(a) Hedge Transactions and:
(i) if the Termination Date has not yet occurred, the Borrower
certifies that it will only enter into Hedge Transactions
referred to in paragraph (a) of the definition of "Hedge
Transaction" with the proposed new Beneficiary in accordance
with the terms of the Syndicated Facility Agreement;
(ii) otherwise, the Borrower certifies that the entry into the
proposed Hedge Transactions will not lead to any Event of
Default or Potential Event of Default under any Finance
Document; or
(b) Refinancing Debt; or
(c) any other obligations (including, without limitation, obligations
in the nature of Indebtedness) which are approved by the Majority
Senior Beneficiaries.
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FINANCE DOCUMENT
5.4 If the Security Trustee:
(a) receives all documentation referred to in clause 5.1 or 5.2; and
(b) (where clause 5.2 applies) is satisfied that the obligations
under the proposed Finance Document fall within paragraph (a),
(b) or (c) of clause 5.3; and
(c) is satisfied that the proposed exposure of the person entitled to
the benefit of the obligations does not require:
(i) any Security Document to be stamped with additional ad
valorem stamp duty; or
(ii) compliance with any other legal formality to ensure the
legality, validity or enforceability of any Security
Document,
or if it does, that the Borrower or another person has paid the
stamp duty or makes arrangements satisfactory to the Security
Trustee for payment of that stamp duty or for compliance with
that formality, as applicable,
the Security Trustee must:
(d) execute the Accession Deed and retain one original for itself and
distribute one original each to the new Beneficiary and the
Borrower; and
(e) enter or cause to be entered into the register referred to in
clause 8 the details (where clause 5.2 applies, as provided by
the Borrower in its request) of the Beneficiary and the Finance
Document.
SECURITY TRUSTEE MAY EXECUTE FOR OTHER PARTIES
5.5 The Borrower, each Junior Creditor and each Beneficiary irrevocably
and unconditionally authorise the Security Trustee, its Authorised
Officers and any delegates and attorneys of them, for valuable
consideration received, to sign any Accession Deed on its behalf which
is presented to it under this clause 5.
WHEN EFFECTIVE
5.6 Upon delivery by the Security Trustee of a completed Accession Deed to
the New Beneficiary:
(a) the New Beneficiary is bound by the terms of this deed; and
(b) any document referred to in that Accession Deed becomes a Finance
Document (and either a Senior Finance Document or Junior Finance
Document, as applicable) for the purposes of this deed and the
Security Documents.
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STAMP DUTY
5.7 Any stamp duty imposed upon a Finance Document or a Security Document
(by reason of the execution of a Finance Document other than a Finance
Document executed pursuant to clause 5.1 outside a syndication process
agreed with the Borrower) must be paid by the Borrower. The Borrower
indemnifies each other party to this deed and each other Beneficiary,
against all loss, costs and expenses in connection with such stamp
duty.
COMPLETE REFINANCING
5.8 If the Borrower wishes to repay and refinance completely all
Indebtedness provided by a Beneficiary which is secured under the
Security Trustee Documents, the Borrower may require that Beneficiary
to novate all of its rights and obligations under the Security Trustee
Documents to the entity providing the refinancing (or a nominee
thereof), subject to that Beneficiary being reasonably satisfied with
the novation documentation and provided the Borrower pays all costs
and expenses of that Beneficiary in connection therewith.
6 CEASING TO BE A BENEFICIARY
BORROWER REQUEST
6.1 The Borrower may request that a Beneficiary cease being a Beneficiary
if, at the time of the Borrower's request, the relevant Beneficiary's
Exposure is nil and the Borrower has no further obligation under any
Finance Documents to the Beneficiary. The Borrower must provide the
Security Trustee with a consent by the Beneficiary (signed by an
Authorised Officer of the Beneficiary) stating that it agrees to cease
being a Beneficiary.
BENEFICIARY REQUEST
6.2 A Beneficiary may at any time notify the Security Trustee in writing
that the Beneficiary wishes to cease to be a Beneficiary in respect of
a Finance Document. Any such notice does not limit the Beneficiary's
rights against the Borrower other than its rights as a Beneficiary.
BENEFICIARY TO ASSIST
6.3 The relevant Beneficiary undertakes to do all things necessary to give
effect to the cessation of it being a Beneficiary under clause 6.1 (if
it is satisfied, acting reasonably, that its Exposure is nil and
Finally Paid) or 6.2, including the execution of the consent referred
to in clause 6.1 (if it is satisfied its Exposure is nil and Finally
Paid) and the surrender of its Accession Deed.
WHEN EFFECTIVE
6.4 A Beneficiary ceases to be a Beneficiary on receipt by the Security
Trustee of a notice from the Beneficiary in accordance with clause 6.1
or 6.2.
ACCESSION DEED
6.5 If a Beneficiary transfers or novates all its rights and obligations
under the Finance Documents to a new Beneficiary who executes an
35
Accession Deed, then the transferor Beneficiary ceases to be a
Beneficiary by executing the Accession Deed as a Retiring Beneficiary.
7 POLITICAL RISK INSURANCE
SUBROGATION UNDER POLITICAL RISK INSURANCE FOR FINANCIERS
7.1 Subject to clause 7.2, as from each date the Political Risk Insurer
pays a claim to a Financier under a Political Risk Insurance Policy
relating to the Syndicated Facility Agreement, the parties acknowledge
that the Political Risk Insurer is subrogated to the rights of the
relevant Financier under the relevant Finance Documents (to the extent
of the amount of the Insurance Payment) and in that capacity is
entitled to:
(a) obtain the benefit of the rights and entitlements of the relevant
Financier under the Finance Documents; and
(b) obtain the benefit of:
(i) the Security Trustee Documents;
(ii) moneys held by the Security Trustee to the extent permitted
by the Security Trustee Documents; and
(iii) a right or power of the Beneficiaries under a Security
Trustee Document,
to the extent of the amount of the Insurance Payment.
POLITICAL RISK INSURER BECOMING A BENEFICIARY
7.2 Any subrogation under clause 7.1 or at law or, in relation to Hedge
PRI, rights to which a Political Risk Insurer becomes entitled
following an Insurance Payment under a Hedge PRI, is subject to:
(a) the Political Risk Insurer being bound by the terms and
conditions of this deed as if it were a party to this deed and
entitled to the benefit of that part of the Secured Money to
which it has become entitled following the Insurance Payment; and
(b) the right of the Security Trustee and each Beneficiary to
continue to deal with the relevant Beneficiary (to whom the
Insurance Payment (or part thereof) has been made) until the
Security Trustee receives from the Political Risk Insurer a duly
completed and executed Accession Deed in accordance with clause
5.1.
7.3 Despite anything to the contrary contained in this deed, the right of
the Political Risk Insurer to enforce or exercise any of its rights or
to share in any receipts or recoveries made under this deed or any
other Finance Document may only be exercised in accordance with the
terms of the Finance Documents or the Security Trustee Documents, as
the case may be.
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7.4 The Borrower irrevocably agrees to any Political Risk Insurer becoming
a Beneficiary in the manner set out in this deed.
ADVISING INSURED PAYMENTS
7.5 At the same time as the Accession Deed is delivered to the Security
Trustee under clause 7.2(b) or as soon as practicable thereafter, the
Financiers (or the Facility Agent on their behalf) and/or the Insured
Hedge Counterparty, as the case may be, must execute and deliver to
the Security Trustee a certificate countersigned by the Political Risk
Insurer setting out:
(a) the Political Risk Insurance Policy under which the proposed
Insurance Payment is to be made;
(b) the nature of the claim;
(c) the amount of the proposed Insurance Payment;
(d) whether the Insurance Payment is to be paid in a lump sum or by
installments; and
(e) the day or, if payable in installments, the days, on which the
proposed Insurance Payment is to be made.
8 REGISTER
The Security Trustee must keep a register ("REGISTER") incorporating
the following information:
(a) the name and address of each Beneficiary; and
(b)
(i) in respect of each Finance Document, the date, parties to
it, name of it and the principal (or notional principal)
amount committed under the facility or hedge (where
applicable) and the maximum term of the agreement and
whether it is a Senior Finance Document or a Junior Finance
Document; or
(ii) if the Beneficiary is a Political Risk Insurer, the details
set out in the certificate referred to in clause 7.5; and
(c) in relation to each Beneficiary, a list of the Finance Documents
to which it is a party,
and must enter in the Register particulars of any changes to the
matters described in paragraphs (a) - (c) from time to time.
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9 ENFORCEMENT
EVENTS OF DEFAULT
9.1 If an Event of Default occurs, the Security Trustee agrees to:
(a) seek the instructions of all Senior Beneficiaries in relation to
the enforcement of the Security; and
(b) act in accordance with the instructions of the Majority Senior
Beneficiaries or otherwise as required in accordance with clause
3.
SECURITY TRUSTEE TO ADVISE VOTING DAY
9.2 When seeking instructions from each Senior Beneficiary, the Security
Trustee must advise each Senior Beneficiary of the date ("VOTING DAY")
on which and the time by which on that date (not later than 11.30am)
instructions must be given to the Security Trustee. The Voting Day may
not be earlier than the fifth Business Day after the date of the
Security Trustee's notice (unless the period has been shortened under
clause 3.6(e)).
BENEFICIARIES TO ADVISE EXPOSURES
9.3 When a Senior Beneficiary gives instructions to the Security Trustee,
it must advise the Security Trustee in writing of its Exposure as at
5.00pm on the Business Day prior to the Voting Day. In the case of any
Beneficiary which is a Hedge Counterparty under a Hedge Transaction
which has not been closed out and terminated, its Hedge Exposure must
be calculated as if all Hedge Transactions with the Borrower were
closed out or terminated on the Business Day prior to the Voting Day.
SECURITY TRUSTEE TO ISSUE ACCELERATION NOTICES
9.4 If the Security Trustee is instructed, in accordance with clause 9.1,
to take steps to enforce under the Security Documents or realise the
Security, the Security Trustee agrees to issue an Acceleration Notice
to any one or more Beneficiaries no later than 4.30pm on the Voting
Day, unless the Majority Senior Beneficiaries otherwise agree.
BENEFICIARIES TO COMPLY WITH ACCELERATION NOTICES
9.5 Each Beneficiary agrees to comply with the terms of that Acceleration
Notice and to exercise all rights and powers available to it (if any)
under each Finance Document and otherwise at law in order to comply
with, or procure compliance with, the direction given by the Security
Trustee in that notice.
HEDGE COUNTERPARTIES
9.6 If at any time an Event of Default occurs under a Hedge Contract, each
Hedge Counterparty agrees with the other Senior Beneficiaries that
prior to exercising any right or power under that Hedge Contract that
arise as a consequence of that Event of Default, it will give notice,
as soon as it becomes aware of that Event of Default, to the Security
Trustee stating that an Event of Default has occurred which is
continuing unremedied and describing that Event of Default and
indicating whether or not it proposes to exercise those rights or
powers
38
under that Hedge Contract and if so in what manner. The Borrower
consents to the giving of such notice.
9.7 The Security Trustee, as soon as practicable after receiving a notice
under clause 9.6, it will provide a copy of it to each Beneficiary.
9.8 The parties agree that, if any set-off or netting occurs in connection
with a Hedge Contract, records of the set-off or netting will be kept
so that the set-off or netting can be separately identified as being
applicable to that Hedge Contract notwithstanding that the set-off or
netting occurred as part of an overall set-off or netting of a number
of Hedge Contracts.
▇▇▇▇▇▇ BENEFICIARY ATTENDING MEETINGS
9.9 If an Event of Default occurs, the Facility Agent agrees to invite the
Junior Beneficiary to attend any meetings held between the Borrower
and the Senior Beneficiaries in relation to the enforcement of the
Security, but excluding that part of any meeting where there is a
conflict of interest between the Senior Beneficiaries and the Junior
Beneficiary including as to:
(a) matters of priority of the Senior Beneficiaries under the
Securities; or
(b) considerations of the Senior Beneficiaries as a secured class of
Beneficiaries.
A Junior Beneficiary may present its point of view at any such meeting
but will not be entitled to vote or otherwise affect any resolution of
that meeting.
Nothing in this clause requires the Security Trustee, the Facility
Agent or a Senior Beneficiary to call any meeting, or to consult with
any Junior Beneficiary, before accelerating any Senior Debt or
enforcing any Security.
NOTIFICATION TO JUNIOR BENEFICIARY
9.10 The Security Trustee agrees to notify any Junior Beneficiary before or
promptly after it or a Senior Beneficiary takes any enforcement action
in relation to any Senior Debt.
On request, each of the Facility Agent and the Junior Beneficiary
shall keep the other informed as to the amount of Senior Debt or
Junior Finance Debt then outstanding.
10 TREATMENT OF RECOVERED MONEYS
MONEYS NOT FORMING PART OF RECOVERED MONEYS
10.1 Where a Finance Document permits or requires moneys to be placed to
the credit of a suspense account held by the Security Trustee in order
to preserve the rights to prove in the bankruptcy or liquidation of a
person, those moneys, will not, unless otherwise determined by all the
Beneficiaries, be treated as Recovered Moneys until the time as, in
39
accordance with the terms of the relevant Finance Document, those
moneys, are no longer held in suspense.
10.2 Where moneys are placed in a suspense account referred to in clause
10.1, interest earned and credited to the account is Recovered Moneys.
RECEIPT NOT THROUGH SECURITY TRUSTEE
10.3 Each Beneficiary agrees to notify the Security Trustee promptly of its
receipt (other than by payment through the Security Trustee) of
Secured Moneys on or after the Enforcement Date (including without
limitation, a recovery by set-off or banker's lien or by way of
payment netting under Hedge Contracts). The parties acknowledge that a
receipt by way of set-off occurs at the time the Beneficiary applies
the set-off in its books of account, irrespective of the time when the
amount set-off was deposited with that party.
ACCOUNTING TO SECURITY TRUSTEE
10.4 Subject to clause 10.8, if the receipt represents an amount which, had
it been received by the Security Trustee, would have been
distributable not only to the Beneficiary who receives it but also to
the other Beneficiaries (including by reason of the operation of
clause 10.9), then the Beneficiary agrees to pay, to the Security
Trustee an amount, equivalent to the amount, received within two
Business Days of receiving it. The amount paid to the Security Trustee
is to be:
(a) taken to have been received by the Security Trustee and not by
the Beneficiary who receives it (and the Secured Money of that
Beneficiary is to continue to include that amount); and
(b) distributed by the Security Trustee to the parties entitled to it
in accordance with their entitlements.
REFUND TO BENEFICIARY
10.5 If a Beneficiary who receives a payment referred to in clause 10.3 is
obliged to refund any part of it under laws relating to insolvency
then, on request from the Beneficiary, each party to which any part of
the payment was distributed must repay to the Beneficiary the
proportion of the amount received by that party equal to the
proportion of the payment received by the Beneficiary which the
Beneficiary is obliged to refund.
10.6 An amount paid under clause 10.5 will be deemed to have been a payment
for the account of the Security Trustee and not to the relevant
Beneficiary for its own account and to that extent the liability to
the relevant Beneficiary will not be reduced by the amount received,
other than to the extent of any distribution received by the relevant
Beneficiary under clause 10.4(b).
10.7 The Borrower must immediately on the relevant Beneficiary making or
becoming liable to make a payment under clause 10.4 indemnify the
relevant Beneficiary against that payment to the extent that the
Borrower's liability has been discharged by the amount received by the
relevant Beneficiary.
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NETTING AS BETWEEN HEDGE TRANSACTIONS NOT TO CONSTITUTE RECOVERED MONEY
10.8 Despite anything to the contrary in this deed:
(a) the operation of netting provisions under a Hedge Contract is
permitted; and
(b) any amount which would otherwise be payable to a Hedge
Counterparty under the Hedge Contract but for the operation of
the netting provisions will not constitute Recovered Money for
the purposes of this deed, but only to the extent such provisions
provide for netting of amounts, obligations and/or cross-claims
as between Hedge Transactions between the Borrower and the Hedge
Counterparty and not any other obligations or cross-claims
arising under any other Transactions or other agreement or
arrangement ("NON-HEDGE TRANSACTIONS").
SHARING IN RELATION TO NON-HEDGE TRANSACTIONS
10.9 If a termination and close-out under a Hedge Contract occurs on or
after the Enforcement Date and immediately before the Early
Termination Date in respect of the Terminated Transactions, the
notional net exposure of a Hedge Counterparty under the Non-Hedge
Transactions calculated in accordance with clause 1.6(a) (but
replacing all references in clause 1.6(a) to "Hedge Transactions with
"Non- Hedge Transactions") would have given rise to a net amount
notionally owing to the Borrower ("RELEVANT AMOUNT"), then the
Relevant Amount is to be treated as a receipt for the purposes of
clause 10.4. In this clause, "Early Termination Date" and "Terminated
Transactions" have the meanings given in the ISDA Master Agreement.
PROCEEDS OF POLITICAL RISK INSURANCE POLICIES NOT TO CONSTITUTE RECOVERED MONEY
10.10 Despite anything to the contrary in this deed or any provision of the
Syndicated Facility Agreement, each Financier and Hedge Counterparty
(in its capacity as an insured under a Political Risk Insurance
Policy) is absolutely entitled to all the proceeds payable to it under
any Political Risk Insurance Policy and is under no obligation to pay
those proceeds to the Security Trustee or any Beneficiary.
11 DISTRIBUTION OF RECOVERED MONEY
11.1 If at any time the Security Trustee receives any money under a
Security Trustee Document on or after the Enforcement Date, whether or
not it represents the proceeds of recovery action taken under any
Finance Document, then the money must be distributed by the Security
Trustee in accordance with clause 11.2.
11.2 Recovered Money is to be distributed by the Security Trustee as soon
as practicable after the Security Trustee receives it as follows:
(a) first, to the extent that the Recovered Money represents money
recovered under a Security Document which provides for the
appointment of a receiver, in the order provided for under the
41
Security Document up to and including the category of satisfying
the remuneration of the receiver (as defined in that Security);
(b) secondly, towards satisfaction of all costs, charges and expenses
incurred by the Security Trustee in or incidental to the exercise
or performance or attempted exercise or performance of any of the
rights, powers or remedies conferred under any Security Trustee
Document;
(c) thirdly, towards satisfaction of any other expenses or outgoings
in connection with any receivership under or the enforcement of
any Security Trustee Document;
(d) fourthly, towards payment to the Security Trustee of any money
due to it in its capacity as Security Trustee under any Security
Trustee Document;
(e) fifthly, towards payment to each Senior Beneficiary of an amount
(not exceeding the Exposure of that Senior Beneficiary under the
Senior Finance Documents) equal to that Senior Beneficiary's
Share at that time of the Recovered Money;
(f) sixthly, after the Senior Debt has been Finally Paid, towards
payment to each Junior Beneficiary of an amount (not exceeding
the Exposure of that Junior Beneficiary) equal to that Junior
Beneficiary's Share at that time of the Recovered Money; and
(g) seventhly, to the extent that the Security secures the payment of
other amounts, towards payment to the persons entitled to those
amounts and, if more than one, in a proportion for each person
equal to the proportion that the amount owed to that person bears
to the aggregate amount owed to all those persons,
or in such other manner as the Security Trustee (acting under the
instructions of the Majority Senior Beneficiaries) determines.
12 REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT
REPRESENTATIONS AND WARRANTIES
12.1 The Borrower makes (on the date of this deed) and repeats (every 6
months thereafter) for the benefit of the Security Trustee and the
Beneficiaries the following representation and warranties:
(a) (DUE INCORPORATION) it has been duly incorporated in accordance
with the laws of PNG, is validly existing under those laws and
has the power and authority to carry on its business as it is now
being conducted;
(b) (POWER) it has power under its constitution to enter into and
observe its obligations under the Security Trustee Documents;
42
(c) (AUTHORISATIONS) all material authorisations necessary to enter
into the Security Trustee Documents and to comply with its
obligations thereunder are in full force and effect;
(d) (VALID OBLIGATIONS) its obligations under the Security Trustee
Documents are valid and binding and are enforceable against it in
accordance with its terms except to the extent limited by
equitable principles, statutes of limitations and laws affecting
creditors' rights generally;
(e) (NO CONTRAVENTION) the Security Trustee Documents and the
transactions under them do not contravene its constitution or any
law, judgment, agreement, instrument or any of its obligations or
undertakings by which it is bound or to which any of its assets
are subject;
(f) (NO TRUST) it does not enter into any Security Trustee Document
in the capacity of a trustee of any trust or settlement; and
(g) (GOOD TITLE) it is the sole beneficial owner of all assets
included in its latest audited accounts (other than those
disposed of, as permitted under the Senior Finance Documents),
free and clear of any Security Interest, other than a Security
Interest permitted by any Senior Finance Document).
UNDERTAKINGS RELATING TO SECURED PROPERTY
12.2 The Borrower undertakes to:
(a) (RATES AND TAXES) unless contested in good faith, pay on time all
amounts for which it is liable as owner of the Secured Property,
including rates and Taxes; and
(b) (GOOD CONDITION) keep the Secured Property in good working order
and condition in accordance with prudent mining practice and
correct any defect in accordance with prudent mining practice;
and
(c) (LOSS) use reasonable endeavours to protect the Secured Property
from theft, loss or damage; and
(d) (VALUE) not do anything that lowers or might lower the value of
the Secured Property so as to give rise to a Material Adverse
Effect; and
(e) (SERIOUS DAMAGE) notify the Security Trustee of any damage to or
defect in the Secured Property which would have a Material
Adverse Effect; and
(f) (ORDERS OR NOTICES) give the Security Trustee a copy of any order
or notice from an authority such as a local council concerning
the use or condition of the Secured Property which would have a
Material Adverse Effect as soon as it becomes aware of it; and
43
(g) (LAWS) except as permitted by the Mining Development Contract and
unless contested in good faith, duly and punctually comply with
all laws, licences, permits, authorisations, orders or decrees of
a Government Agency binding upon it where failure to do so would
have a Material Adverse Effect; and
(h) (CAVEATS, NOTIFICATIONS OR DEALINGS) do everything necessary to
remove any caveat, notification or dealing placed on the title to
the Secured Property without the Security Trustee's consent; and
(i) (TENEMENTS) ensure that all conditions and requirements relating
to mining tenements are observed or performed in all material
respects and that tenements remain valid and are in full force
and effect; and
(j) (INSURANCE) ensure that the assets of the Borrower are adequately
insured in accordance with prudent mining practice, and that the
Beneficiaries are named as insured parties under material
insurance policies;
(k) (BOOK DEBTS) until the Security Trustee otherwise directs at any
time after an Enforcement Date, procure the prompt collection of
its book debts. The Security Trustee appoints the Borrower its
agent for this purpose;
(1) (PROCEEDS OF BOOK DEBTS AND INSURANCES) unless otherwise provided
in a Senior Finance Document, apply the proceeds of any book
debts and insurances, toward proper business purposes;
(m) (ACCESS AND INSPECTION) give or procure to be given (promptly
upon request by the Security Trustee acting on instructions of
the Majority Senior Beneficiaries) to the Security Trustee and
any of its Authorised Officers, access (subject to generally
applicable site safety requirements) to the Mine, the Mine area,
the books and accounting records and other data of and relating
to the Borrower or the Mine, as any of them may reasonably
require;
(n) (DISPOSAL OF ASSETS) ensure that it does not dispose of assets
other than;
(i) in the ordinary course of business on terms no less
favourable to the Borrower than arm's length terms; or
(ii) where the aggregate book value of assets disposed of over
the previous 12 month period does not exceed 5% of the total
tangible assets of the Borrower; or
(iii) with the approval of the Security Trustee, such approval
not to be unreasonably withheld.
44
For avoidance of doubt, any assets disposed of in accordance with
this clause which are subject to a fixed charge will
automatically cease to be subject to that charge.
(o) (MARGIN) not to agree to any margin requirements under any hedge
contract entered into or to be entered into by it; and
(p) (LEASES AND LICENCES) not to lease or license (or deal with any
lease or licence) any Secured Property except for leases and
licences incidental to, or associated with, proper conduct of the
Borrower's mining operations.
FURTHER ASSURANCES
12.3 (a) (DEPOSIT OF DOCUMENTS) The Borrower agrees to deposit with the
Security Trustee:
(i) all documents of title (including, if applicable, leases)
relating to the Secured Property where the Secured Property
is the subject of a mortgage or a fixed charge; and
(ii) any other documents the Security Trustee requests relating
to the Secured Property.
(b) (REGISTRATION OF SECURITY) The Security Trustee may register the
Security Documents at the Borrower's expense.
(c) (AUTHORITY TO FILL IN BLANKS) The Borrower agrees that the
Security Trustee may fill in any blanks in connection with the
Security Documents (such as Corporations Act forms or transfers
for the Secured Property).
(d) (SUPPLY OF INFORMATION) If the Security Trustee asks, the
Borrower agrees to supply the Security Trustee with any
information about or documents affecting:
(i) the Security Documents or the Secured Property; or
(ii) any lease, tenancy or other arrangement connected with the
Secured Property.
(e) (RECTIFICATION) If the Security Trustee asks, promptly rectify
defects in the condition, validity or enforceability of any
Mortgaged Agreement.
RIGHTS OF ENTRY
12.4 Subject to clause 12.2(m), the Security Trustee may, if an Event of
Default or Potential Event of Default is subsisting, enter land and
buildings owned or occupied by the Borrower, any place where the
Secured Property is located, the Borrower's places of business or its
registered office to:
(a) inspect the Secured Property; or
45
(b) find out whether the Borrower is complying with the Security
Documents; or
(c) carry out the Security Trustee's rights under the Security
Documents; or
(d) inspect and copy records relating to the Borrower or the Secured
Property; or
(e) investigate the Borrower's financial affairs or business.
The Borrower agrees to help the Security Trustee enter, such as by
obtaining any necessary consent.
REASONABLE NOTICE OF ENTRY
12.5 Unless there is an emergency, the Security Trustee agrees to give the
Borrower reasonable notice before entering under this clause.
RIGHT TO RECTIFY
12.6 The Security Trustee may do anything which the Borrower should have
done under the Security Documents however which the Borrower either
has not done, or in the Security Trustee's opinion, has not done
properly. If the Security Trustee does so, the Borrower agrees to pay
the Security Trustee's Costs on demand.
SECURITY TRUSTEE NOT MORTGAGEE IN POSSESSION
12.7 The Security Trustee does not become a mortgagee in possession because
it enters the Secured Property under clause 12.5 or exercises its
rights under clause 12.6.
PAYMENT OF INCOME TO SECURITY TRUSTEE
12.8 If, on or after the Enforcement Date, the Security Trustee asks, the
Borrower agrees to ensure that rent and other income from the Secured
Property are paid to the Security Trustee. If, despite this, they are
paid to the Borrower, the Borrower agrees to pay them to the Security
Trustee. In each case, the Security Trustee agrees to use the money it
receives as set out in clause 11 of this deed.
EVENT OF DEFAULT
12.9 Each Event of Default is an "Event of Default" for the purposes of the
Security Trustee Documents.
13 COSTS AND INDEMNITIES
WHAT THE BORROWER AGREES TO PAY
13.1 The Borrower agrees to pay or reimburse:
(a) the reasonable Costs of the Security Trustee in connection with:
(i) the negotiation, preparation, execution and registration of
and payment of Taxes on any Security Trustee Document; and
46
(ii) their being satisfied that conditions to drawdown have been
met; and
(iii) giving and considering consents, waivers, variations,
discharges and releases and producing title documents; and
(iv) otherwise acting in connection with the Security Trustee
Documents (except for the matters described in paragraph (b)
below);
(b) the Costs of the Security Trustee in exercising, enforcing or
preserving rights (or considering doing so), or doing anything in
connection with any enquiry by an authority involving the
Borrower or any of its Related Entities; and
(c) Taxes and fees (including registration fees) and fines and
penalties in respect of fees paid, or that the Security Trustee
reasonably believes are payable, in connection with any Security
Trustee Document or a payment or receipt or any other transaction
contemplated by any Security Trustee Document. However, the
Borrower need not pay a fine or penalty in connection with Taxes
or fees to the extent that it has placed the Security Trustee in
sufficient cleared funds for the Security Trustee to be able to
pay the Taxes or fees by the due date.
The Borrower agrees to pay amounts due under this clause promptly on
demand from the Security Trustee.
INDEMNITY
13.2 The Borrower indemnifies the Security Trustee against any liability or
loss arising from, and any Costs incurred in connection with:
(a) the Security Trustee acting in connection with a Security Trustee
Document in good faith on fax or telephone instructions
purporting to originate from the offices of the Borrower or to be
given by an Authorised Officer of the Borrower; or
(b) an Event of Default; or
(c) the Security Trustee exercising or attempting to exercise a right
or remedy in connection with a Security Trustee Document after an
Event of Default; or
(d) any Security Trustee Document; or
(e) any indemnity the Security Trustee gives a Controller or
administrator of the Borrower.
A party's obligation to reimburse another party for an amount paid or
payable to a third party includes GST on the amount paid or payable to
47
the third party except to the extent that the party being reimbursed
is entitled to claim an input tax credit for that GST.
13.3 The Borrower agrees to pay amounts due under this indemnity on demand
from the Security Trustee. The Costs referred to in clause 13.1 and
13.2 include legal Costs in accordance with any written agreement as
to legal costs or, if no agreement, on whichever is the higher of a
full indemnity basis or solicitor and own client basis and Costs
suffered or incurred by any employee, officer, agent or contractor of
the Security Trustee.
CURRENCY CONVERSION ON JUDGMENT DEBT
13.4 If a judgment, order or proof of debt for an amount in connection with
a Security Trustee Document is expressed in a currency other than that
in which the amount is due under the Security Trustee Document, then
the Borrower indemnifies the Security Trustee against:
(a) any difference arising from converting the other currency if the
rate of exchange used by the Financier under clause 2.9 for
converting currency when it receives a payment in the other
currency is less favourable to the Financier than the rate of
exchange used for the purpose of the judgment, order or
acceptance of proof of debt; and
(b) the Costs of conversion.
The Borrower agrees to pay amounts due under this indemnity on demand
from the Security Trustee.
STAMP DUTY
13.5 Without prejudice to the other provisions of this clause 13, the
Borrower agrees to pay an amount equal to US$50,000 into an
interest-bearing bank account to be opened in the name of the Security
Trustee ("ESCROW ACCOUNT") no later than the first Drawdown Date under
the Syndicated Facility Agreement. The Security Trustee may only apply
moneys in the Escrow Account to pay any stamp duty applicable on any
Security Trustee Documents or Senior Finance Documents to the extent
any upstamping of such documents is required after that date. If, at
the time all amounts under the Finance Documents are Finally Paid,
there is any amount remaining in the Escrow Account, the Security
Trustee agrees to pay the balance standing to the credit of the Escrow
Account to the Borrower.
14 ACKNOWLEDGMENT
The Borrower acknowledges and agrees to the provisions of this deed
and undertakes to co-operate in the implementation of the provisions
of this deed.
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15 NOTICES
15.1 A notice, approval, consent or other communication in connection with
this deed:
(a) may be given by an Authorised Officer of the relevant party; and
(b) must be in writing; and
(c) must be left at the address of the addressee or sent by prepaid
ordinary post (airmail if posted to or from a place outside
Australia) to the address of the addressee which is specified
below (in the case of the Borrower, the Security Trustee and the
Junior Creditors) or in schedule 4 (in the case of the Initial
Hedge Counterparties) or otherwise notified to the Borrower and
the Security Trustee (in the case of the other parties) or if the
addressee notifies another address or facsimile number then to
that address or facsimile number:
BORROWER
Lihir Gold Limited
Level ▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
Cnr Champion Parade and ▇▇▇▇▇▇▇▇ Street
Port Morseby
Papua New Guinea
Telephone: ▇▇▇ ▇ ▇▇▇ ▇▇▇▇
Fax: ▇▇▇ ▇ ▇▇▇ ▇▇▇▇
Attention: General Manager Financial and Commercial and
Chief Financial Officer
NML AND NMAL
GPO Box 905
BRISBANE QUEENSLAND 4001
Fax: ▇▇▇ ▇ ▇▇▇▇ ▇▇▇▇
Attention: The Company Secretary
FACILITY AGENT AND SECURITY TRUSTEE
Level 26, ABN AMRO Tower
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
Fax: ▇▇▇ ▇ ▇▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
15.2 Unless a later time is specified in it a notice, approval, consent or
other communication takes effect from the time it is received.
49
15.3 A letter or facsimile is taken to be received:
(a) in the case of a posted letter, on the third (seventh if posted
to or from a place outside Australia) day after posting; and
(b) in the case of a facsimile, on production of a transmission
report by the machine from which the facsimile was sent which
indicates that the facsimile was sent in its entirety to the
facsimile number of the recipient notified for the purpose of
this clause.
16 GENERAL
SET-OFF
16.1 At any time on or after the Enforcement Date or, if earlier, the date
a notice is given under clause 12.2 of the Syndicated Facility
Agreement, the Security Trustee or a Senior Beneficiary may set off
any amount due for payment by the Security Trustee or the Senior
Beneficiary, respectively, to the Borrower against any amount due for
payment by that Borrower to the Security Trustee or the Senior
Beneficiary, respectively, under the Senior Finance Documents.
CERTIFICATES
16.2 The Security Trustee, a Senior Beneficiary, a Junior Creditor or a
Junior Beneficiary may give a Borrower a certificate about an amount
payable or other matter in connection with a Security Trustee
Document. The certificate is sufficient evidence of the amount or
other matter, unless it is proved to be incorrect.
DISCRETION IN EXERCISING RIGHTS
16.3 The Security Trustee, a Senior Beneficiary or the Junior Beneficiary
may exercise a right or remedy or give or refuse its consent in any
way it considers appropriate (including by imposing conditions),
unless a Security Trustee Document expressly states otherwise.
CONSENTS
16.4 The Borrower agrees to comply with all conditions in any consent the
Security Trustee, a Senior Beneficiary or the Junior Beneficiary gives
in connection with a Security Trustee Document.
PARTIAL EXERCISING OF RIGHTS
16.5 If the Security Trustee, a Senior Beneficiary or the Junior
Beneficiary does not exercise a right or remedy fully or at a given
time, the Security Trustee or the Beneficiary can still exercise it
later.
CONFLICT OF INTEREST
16.6 The Security Trustee's or a Senior Beneficiary's or the Junior
Beneficiary's rights and remedies under this deed may be exercised
even if this involves a conflict of duty or the Security Trustee or
the Senior Beneficiary has a personal interest in their exercise.
50
REMEDIES CUMULATIVE
16.7 The rights and remedies of the Security Trustee, a Senior Beneficiary
or the Junior Beneficiary under this deed are in addition to other
rights and remedies given by law independently of this deed.
RIGHTS AND OBLIGATIONS ARE UNAFFECTED
16.8 Rights given to the Security Trustee, a Senior Beneficiary or the
Junior Beneficiary under this deed and the Borrower's liabilities
under it are not affected by any law that might otherwise affect them.
INDEMNITIES
16.9 The indemnities in this deed are continuing obligations, independent
of the Borrower's other obligations under this deed and continue after
this deed ends.
VARIATION AND WAIVER
16.10 Unless this deed expressly states otherwise, a provision of this
deed, or right created under it, may not be waived or varied except in
writing signed by the Security Trustee (acting pursuant to this deed)
and the Borrower. The Security Trustee and the Beneficiaries (with or
without the Borrower) may separately agree in writing arrangements in
connection with the Security Trustee Documents, including, without
limitation, voting, priority and ranking and restrictions on
Beneficiaries' rights in connection with their respective Finance
Documents.
FURTHER STEPS
16.11 The Borrower agrees to do anything the Security Trustee asks (such as
obtaining consents, signing and producing documents and getting
documents completed and signed) to bind the Borrower and any other
person intended to be bound under the Security Trustee Documents.
INCONSISTENT LAW
16.12 To the extent permitted by law, this deed prevails to the extent it
is inconsistent with any law.
SUPERVENING LEGISLATION
16.13 Any present or future legislation which operates to vary the
obligations of the Borrower in connection with a Finance Document with
the result that the Security Trustee's, a Senior Beneficiary's or the
Junior Beneficiary's rights, powers or remedies are adversely affected
(including by way of delay or postponement) is excluded except to the
extent that its exclusion is prohibited or rendered ineffective by
law.
REINSTATEMENT OF RIGHTS
Under law relating to insolvency, a person may claim that a
transaction (including a payment) in connection with the Secured Money
is void or voidable. If a claim is made and upheld, conceded or
compromised, then:
(a) the Security Trustee and relevant Senior Beneficiary are
immediately entitled as against the Borrower, any Junior Creditor
and any Junior Beneficiary to the rights in respect of
51
the Secured Money to which it was entitled immediately before the
transaction; and
(b) on request from the Security Trustee, the Borrower, the Junior
Creditors and the Junior Beneficiaries agree to do anything
(including signing any document) to restore to the Security
Trustee and the relevant Senior Beneficiary any rights and
benefits held by that Senior Beneficiary under the Security
Trustee Documents immediately before the transaction.
TIME OF THE ESSENCE
16.14 Time is of the essence in any Finance Document in respect of an
obligation of the Borrower to pay money.
COUNTERPARTS
16.15 This deed may consist of a number of copies of this deed each signed
by one or more parties to the deed. When taken together, the signed
copies are treated as making up the one document.
17 GOVERNING LAW, JURISDICTION AND SERVICE OF PROCESS
17.1 This deed is governed by the law in force in New South Wales.
17.2 Each party irrevocably and unconditionally submits to the non-
exclusive jurisdiction of the courts of New South Wales and courts of
appeal from them. Each party waives any right it has to object to an
action being brought in those courts including, without limitation, by
claiming that the action has been brought in an inconvenient forum or
that those courts do not have jurisdiction.
17.3 Without preventing any other mode of service, any document in an
action (including, without limitation, any writ of summons or other
originating process or any third or other party notice) may be served
on any party by being delivered to or left for that party with its
process agent referred to in clause 17.4. at its address for service
of notices under clause 15.
17.4 Each of the following parties, not having a registered office in
Australia appoints the following person as its process agent who may
receive any document referred to in clause 17.3:
J ▇▇▇▇ & Company appoints ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ Were Financial Markets
Pty Ltd of Level ▇▇, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
If for any reason that person ceases to be able to act as such, the
relevant party must immediately appoint another person within
Australia to receive any such document.
EXECUTED as a deed
52
SCHEDULE 1 DESIGNATION NOTICE
FROM: LIHIR GOLD LIMITED (ARBN 0069 803 998) (Company No. C2-23423) incorporated
in Papua New Guinea of Level 7, Pacific Place, Cnr Champion Parade and
▇▇▇▇▇▇▇▇ Street, Port Moresby, Papua New Guinea ("BORROWER")
TO: ABN AMRO AUSTRALIA LIMITED (ABN 78 000 862 797) having an office for
service at Level ▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇
for itself (in its capacity as trustee for the Lihir Gold Security Trust)
and each other Beneficiary ("SECURITY TRUSTEE")
DESIGNATION NOTICE - LIHIR GOLD SECURITY TRUST
We refer to the Security Trust Deed dated 22 November 2000 as amended from time
to time between the Borrower, the Security Trustee and others (the "SECURITY
TRUST DEED").
Terms defined in the Security Trust Deed have the same meaning when used in this
notice.
We propose to designate the following documents and persons to be Finance
Documents and Beneficiaries respectively for the purposes of the Security Trust
Deed:
- Details of proposed new Beneficiary (full name, ABN/ARBN if applicable,
address, fax, attention) and whether the new Beneficiary is also a Junior
Creditor
- Description of proposed new Finance Document (date, type of obligation (and
if relates to Indebtedness, maximum principal (or notional principal)
permitted), maximum term or Hedge Transaction (describe type))
- Designation as Senior Finance Document or Junior Finance Document
- List documents attached (each relevant new Finance Document):
[_______________]
We confirm that:
(a) the proposed new Finance Document is of the kind described in, and which
otherwise complies with the requirements of the Security Trust Deed and
constitutes a [Hedge Transaction]/[Refinancing Debt]/[other Indebtedness
approved by the Majority Senior Beneficiaries] for the purposes of the
Security Trust Deed;
(b) *[no Event of Default is subsisting] [*may be waived by the Security
Trustee]; and
(c) the designation of this new Finance Document and the new Beneficiary will
not cause a breach of any provision of any Finance Document.
Executed in New South Wales
-------------------------------------
Director
LIHIR GOLD LIMITED
DATE:
-------------------------------
53
SCHEDULE 2 ACCESSION DEED
ACCESSION DEED dated ___________ between: __________
[_______________] ("NEW BENEFICIARY"); and
[[_______________] ("RETIRING BENEFICIARY"); and]][OPTIONAL]
[_______________] ("SECURITY TRUSTEE") for itself and on behalf of the other
parties to the Security Trust Deed.
1 DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this deed, "Security Trust Deed" means the security trust deed dated 22
November 2000 as amended from time to time between the Security Trustee and
others establishing the Lihir Gold Security Trust. Terms defined in the
Security Trust Deed have the same meaning in this deed.
1.2 INTERPRETATION
Clause 1.2 of the Security Trust Deed applies to this deed.
2. ACCESSION [AND RELEASE)
2.1 With effect from and including the date this Accession Deed is delivered by
the Security Trustee to the New Beneficiary under clause 5.4 ("Finance
Document") of the Security Trust Deed:
(a) the New Beneficiary is bound by the terms of the Security Trust Deed
as a Beneficiary in its capacity as a [Senior/Junior Beneficiary]
under the [Senior/Junior Finance Document] as described below:
[describe document]; and
(b) each other party to the Security Trust Deed and each [Senior/Junior]
Finance Document confirms and acknowledges that the New Beneficiary is
a Beneficiary and is bound by the terms of the Security Trust Deed;
and
(c) the Retiring Beneficiary is released from [all its obligations] / [or
specify portion of obligations] under the Security Trust Deed but
without prejudice to any existing liability).]
[OR [choose this second option if New Beneficiary is a Political Risk
Insurer under a lender's political risk insurance]
With effect from and including the date this Accession Deed is delivered by
the Security Trustee to the New Beneficiary under clause 5.4 ("Finance
Document") of the Security Trust Deed:
(a) the New Beneficiary is a Beneficiary in its capacity as:
54
(i) a Senior Beneficiary under a Senior Finance Document as described
below:
[describe document];
OR
(ii) a Junior Beneficiary under a Junior Finance Document as described
below:
[describe document];
is bound by the terms of the Security Trust Deed; and
(b) each other party to the Security Trust Deed and each [Senior/Junior]
Finance Document confirms and acknowledges that the New Beneficiary is
a beneficiary and is bound by the terms of the Security Trust Deed.
2.2 This deed is a Security Trustee Document and the New Beneficiary is a
[Senior Beneficiary/Junior Beneficiary] for the purposes of the Security
Trust Deed.
3. NOTICES
For the purpose of the Security Trustee Documents, the address for
correspondence of the New Beneficiary is the address set out below:
[_______________]
4. LAW
This deed is governed by the laws of New South Wales.
Each attorney executing this certificate states that he or she has no
notice of revocation or suspension of his or her power of attorney. The New
Beneficiary irrevocably and unconditionally submits to the non-exclusive
jurisdiction of the courts of New South Wales and courts of appeal from
them and waives any right it has to object to an action being brought in
those courts including, without limitation, by claiming that the action has
been brought in an inconvenient forum or that those courts do not have
jurisdiction.
5. [AGENT FOR SERVICE OF PROCESS)
[The New Beneficiary appoints [_______________] to act as its agent for
service of process.][* ONLY REQUIRED IF NEW BENEFICIARY DOES NOT HAVE A
PRESENCE IN AUSTRALIA.]
EXECUTED as a deed.
[Execution provisions]
55
SCHEDULE 3 ACCESSION DEED FOR HEDGE PRI
ACCESSION DEED dated ___________ between: __________
[_______________] ("NEW BENEFICIARY"); and
[_______________] ("SECURITY TRUSTEE") for itself and on behalf of the other
parties to the Security Trust Deed.
1 DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this deed, "Security Trust Deed" means the security trust deed dated 22
November 2000 as amended from time to time between the Security Trustee and
others establishing the Lihir Gold Security Trust. Terms defined in the
Security Trust Deed have the same meaning in this deed.
1.2 INTERPRETATION
Clause 1.2 of the Security Trust Deed applies to this deed.
2. ACCESSION
2.1 With effect from and including the date this Accession Deed is delivered by
the Security Trustee to the New Beneficiary under clause 5.4 ("Finance
Document") of the Security Trust Deed:
(a) the New Beneficiary is bound by the terms of the Security Trust Deed
as a Beneficiary in its capacity as a Senior Beneficiary in connection
with the [describe relevant Hedge Contract and attach certificate
referred to in clause 7.5 ("CERTIFICATE")]; and
(b) the instrument(s)/agreement(s)/deed(s) described in the Designation
Notice (if applicable) is/are Finance Documents for the purpose of the
Security Trust Deed; and
(c) each other party to the Security Trust Deed and each Security Trustee
Document confirms and acknowledges that the New Beneficiary is a
Beneficiary and is bound by the terms of the Security Trust Deed.
2.2 This deed is a Security Trustee Document and the New Beneficiary is a
Senior Beneficiary for the purposes of the Security Trust Deed.
3. NOTICES
For the purpose of the Security Trustee Documents, the address for
correspondence of the New Beneficiary is the address set out below:
[_______________]
4. LAW
This deed is governed by the laws of New South Wales.
Each attorney executing this certificate states that he or she has no
notice of revocation or suspension of his or her power of attorney. The New
Beneficiary irrevocably and
56
unconditionally submits to the non-exclusive jurisdiction of the courts of
New South Wales and courts of appeal from them and waives any right it has
to object to an action being brought in those courts including, without
limitation, by claiming that the action has been brought in an inconvenient
forum or that those courts do not have jurisdiction.
5. [AGENT FOR SERVICE OF PROCESS]
[The New Beneficiary appoints [_______________] to act as its agent for
service of process.][* ONLY REQUIRED IF NEW BENEFICIARY DOES NOT HAVE A
PRESENCE IN AUSTRALIA.]
EXECUTED as a deed. [Insert appropriate execution clauses]
57
SCHEDULE 4 INITIAL HEDGE COUNTERPARTIES
ABN AMRO BANK N.V.
Level 24
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Attention: Agency Department
CITIBANK N.A.
Level 25
Waterfront Place
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Attention: Head, Corporate Banking, Queensland
J ▇▇▇▇ & COMPANY
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Attention: Metals Department
WITH COPY TO:
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Attention: Legal Department
UBS AG
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Attention: Precious Metals Division