EXHIBIT 10.32
THIS SHARE CHARGE is made the 30 November 2001.
BETWEEN:
(1) PALM IRELAND INVESTMENT, a corporation organized under the laws of the
Republic of Ireland with its principal place of business at ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇ (the "Chargor"); and
(2) FOOTHILL CAPITAL CORPORATION, a Californian corporation with its principal
place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ West, Santa ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ as agent for the hereinafter defined
Lenders (the "Agent").
WITNESSES as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions: In this Share Charge, words or expressions defined in the
Loan Agreement (as defined below) shall, unless otherwise defined below,
bear the same meaning in this Share Charge and, in addition, in this Share
Charge (unless the context otherwise requires) the following expressions
have the following meanings:
"Business Day" means a day on which banks generally are open for business
(other than a day on which banks are only open for business in Euros) in
California (excluding Saturdays, Sundays and bank or public holidays in
those places);
"Charged Property" means all Investments from time to time charged in
favour of, or assigned to, Agent on behalf of the Lender Group by or
pursuant to this Share Charge;
"Default" has the meaning given to it in the Loan Agreement;
"Event of Default" has the meaning given to it in the Loan Agreement;
"Group" means together the Domestic Parent (as defined in the Loan
Agreement) and its direct and indirect subsidiaries from time to time and
"Group Company" means any of such entities;
"Investments" means:
(a) the Securities;
(b) all stocks, shares or other securities, rights, monies or other
property (together the "Derivative Assets") accruing, offered,
issued or otherwise derived at any time (whether before or after the
date of this Share Charge) by way of bonus,
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redemption, exchange, purchase, substitution, conversion,
preference, option or otherwise in respect of any of the Securities;
and
(c) all dividends, interest and other distributions paid or payable in
respect of or deriving from any of the Securities or the Derivative
Assets or deriving from any investment of any such dividends,
interest or other income
provided however that the Investments shall at no time exceed 100%
of the entire issued ordinary share capital of Subsidiary Borrower;
"Lender Group" shall have the meaning given to it in the Loan Agreement;
"Lenders" shall have the meaning given to it in the Loan Agreement and
shall include (where the context permits or requires) any successor,
assignee or transferee lenders permitted under the Loan Agreement;
"Lien" means any lien, mortgage, charge, standard security, pledge,
hypothecation, security trust, assignment by way of security, or any other
security interest whatsoever, howsoever created or arising or any other
agreement or arrangement, having the commercial effect of conferring
security and any agreement to enter into, create or establish any of the
foregoing;
"Loan Agreement" means the Loan Agreement of even date herewith among Palm
Europe Limited as Subsidiary Borrower, the Lenders, Agent, ▇▇▇▇▇▇
Financial, Inc. as the Syndication Agent, and The CIT Group/Business
Credit, Inc. as the Documentation Agent.
"UK Debenture" means the Debenture of even date herewith executed by
Subsidiary Borrower and Agent;
"UK Loan Documents" has the meaning given to it in the Loan Agreement;
"Permitted Lien" has the meaning given to it in the Loan Agreement;
"Secured Sums" means all money and liabilities covenanted to be paid or
discharged by the Chargor to Agent on behalf of the Lender Group under
Clause 2.1 (Covenant to Pay);
"Securities" means the securities described in the First Schedule and all
other stocks, shares or other securities or investments now or in the
future owned at law or in equity by the Chargor constituting 100% of the
issued share capital of Subsidiary Borrower, but not including, for the
avoidance of doubt, stocks, shares or other securities or investments in
the capital of any other company or entity;
"Subsidiary Borrower" means Palm Europe Limited, a company incorporated
under the laws of England and Wales with its registered office at ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇; and
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"United Kingdom" and "UK" means the United Kingdom of Great Britain and
Northern Ireland.
1.2 Interpretation: In this Share Charge, unless the context otherwise
requires:
1.2.1 words denoting the singular number only shall include the plural
number also and vice versa; words denoting the masculine gender
only shall also include the feminine gender; words denoting
persons only shall include corporations, partnerships and
unincorporated associations;
1.2.2 references to clauses, paragraphs and Schedules are to be
construed as references to clauses, paragraphs and Schedules of
this Share Charge;
1.2.3 references to any party shall, where relevant, be deemed to be
references to or to include, as appropriate, their respective
successors or permitted assigns;
1.2.4 references in this Share Charge to this Share Charge or any
other document include references to this Share Charge or such
other document as varied, supplemented, restated and/or replaced
in any manner from time to time and/or any document which
varies, supplements, restates and/or replaces it;
1.2.5 references to "including" and "in particular" shall not be
construed restrictively but shall be construed as meaning
"including, without prejudice to the generality of the
foregoing" and "in particular, but without prejudice to the
generality of the foregoing" respectively;
1.2.6 references to moneys, obligations and liabilities due, owing or
incurred under the UK Loan Documents shall include money,
obligations and liabilities due, owing or incurred in respect of
any extensions or increases in the amount of the facilities
provided for therein or the obligations and liabilities imposed
thereunder;
1.2.7 expressions defined in the Companies ▇▇▇ ▇▇▇▇ shall have the
same meanings in this Share Charge, except that the expression
"company" shall include a body corporate established outside
Great Britain;
1.2.8 any reference to any statute or any section of any statute shall
be deemed to include reference to any statutory modification or
re-enactment of it for the time being in force;
1.2.9 the limitation on liability conferred by section 6(2) of the Law
of Property (Miscellaneous Provisions) ▇▇▇ ▇▇▇▇ shall not apply
to the covenants for title implied on the part of the Chargor by
its execution and delivery of this Share Charge;
1.2.10 references to "law" shall include any present or future common
law, statute, statutory instrument, treaty, regulation,
directive, order, decree, other
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legislative measure, code, circular, notice, demand, or
injunction binding on the persons to whom it is directed to
comply;
1.2.11 a "person" includes any person, individual, firm, company,
corporation, government, state or agency of a state or any
undertaking (within the meaning of Section 259(1) of the
Companies Act 1985) or other association, organisation, trust or
agency (whether or not having separate legal personality) or any
two or more of the foregoing;
1.2.12 "winding-up" of any person includes its dissolution and/or
termination and/or any equivalent or analogous proceedings under
the law of any jurisdiction in which the person concerned is
incorporated, registered, established or carries on business or
to which that person is subject;
1.2.13 reference to "writing" include any telex and facsimile
transmission legibly received, except, unless the Lender
otherwise agrees, in relation to any certificate, forecast,
report, notice, resolution or other document which is expressly
required by this Agreement to be signed, and "written" has
corresponding meaning; and
1.2.14 a time of day is a reference to London time, unless otherwise
stated.
1.3 Index and Headings: The index to and the headings in this Share Charge
are inserted for convenience and shall not affect its interpretation.
2. COVENANT TO PAY
2.1 Covenant to Pay: The Chargor hereby covenants that it will, on demand
in writing made to it by Agent, on or following the making of a demand
made in accordance with the Loan Agreement, pay or discharge to Agent
on behalf of the Lender Group all money and liabilities now or in the
future due, owing or incurred to the Lender Group pursuant to the UK
Loan Documents (other than under Clause 2.1.2 of the UK Debenture) by
Subsidiary Borrower as and when the same fall due for payment, but
which are not paid on their due date.
2.2 Demands from Agent: The making of one demand under this Share Charge
will not preclude Agent from making any further demands.
3. CHARGING CLAUSE
3.1 Charging Clause: The Chargor with full title guarantee hereby charges to
Agent on behalf of the Lender Group as security for the payment or
discharge of all Secured Sums by way of first fixed charge, all the
Chargor's interest in the Investments.
3.2 Proviso for Redemption: On irrevocable and unconditional payment and
discharge of all the Secured Sums and upon the Lender Group being under
no further obligation to provide financial accommodation to the Group
pursuant to the UK Loan Documents, Agent will as soon as practicable at
the request and cost of the Chargor execute such documents (or procure
that its nominees execute such
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documents) as the Chargor may reasonably request which may be required
to discharge the security created by this Share Charge.
4. DOCUMENTS AND VOTING RIGHTS
4.1 Deposit of Documents: Except as otherwise expressly agreed in writing by
Agent, the Chargor shall:
4.1.1 upon executing this Share Charge and, in relation to after
acquired Charged Property, within 30 Business Days of receipt by
the Chargor of the relevant documents of title, deposit with
Agent, and Agent shall be entitled to retain all stock and share
certificates and other documents evidencing, or documents of
title relating to, the Charged Property together with stock
transfer forms (or equivalent instruments of transfer), with the
name of the transferee, the consideration and the date left
blank, but otherwise duly completed and executed by the person
in whose name such certificate or document is, on the basis that
Agent (or its nominee) shall be entitled to hold such
certificates, documents, power of attorney and stock transfer
forms (or equivalent instruments of transfer) until the Secured
Sums have been irrevocably and unconditionally discharged in
full (in accordance with Clause 3.2 (Proviso for Redemption))
and shall be entitled at any time after an Event of Default has
occurred and is continuing to complete (pursuant to its powers
in Clause 11 (Power of Attorney)) the stock transfer forms (or
equivalent instruments of transfer) on behalf of Agent in favour
of Agent or such other persons as it shall select; and
4.1.2 execute and deliver to Agent such documents and transfers and
give such instructions and perform such other acts as Agent may
reasonably require at any time to constitute or perfect an
equitable or legal charge (at Agent's option) over registered
Charged Property or a pledge over bearer Charged Property,
including any Charged Property which the Chargor elects to hold
in any paperless transfer and settlement system or held in a
clearing system.
4.2 Voting Rights:
4.2.1 Unless and until an Event of Default occurs and is continuing:
4.2.1.1 all voting and other rights attaching to any Charged
Property shall continue to be exercised subject to
Clause 5 (Negative Pledge) by the Chargor for so long as
it remains the registered owner and the Chargor shall
not permit any person other than itself or a reputable
paperless transfer and settlement or clearing system,
Agent or Agent's nominee to be registered as holder of
any Charged Property; and
4.2.1.2 if the Charged Property charged under this Share Charge
is registered in the name of Agent, all voting and other
rights attaching
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to it shall be exercised by Agent or its nominee in
accordance with instructions in writing from time to
time received from the Chargor;
provided that the Chargor shall not exercise such voting rights
in a manner which adversely affects the validity or
enforceability of the security created by this Share Charge or
would result in Agent or its nominee incurring any cost or
expense or being subject to any liability unless previously
indemnified to its satisfaction.
4.2.2 Unless an Event of Default occurs and is continuing, the
Chargor shall be entitled to receive and retain all
dividends, distributions and other monies paid on or
derived from the Charged Property.
4.2.3 After an Event of Default occurs and for so long as such
an Event of Default is continuing, Agent on behalf of
the Lender Group shall be entitled to:
4.2.3.1 receive and retain all dividends, distributions
and other monies paid on the Charged Property;
and
4.2.3.2 exercise or direct the exercise of the voting
rights attached to any of the Charged Property
in such manner as it considers fit. The Chargor
shall after such time:
4.2.3.2.1 comply, or procure the compliance,
with any directions of Agent in
respect of the exercise of the voting
rights attached to such Investments;
and
4.2.3.2.2 if Agent so requires by notice to the
Chargor, immediately deliver to Agent
a form of proxy or other authority
(in each case, in such form as Agent
shall reasonably require) appointing
such person as Agent shall select as
proxy of the Chargor or, as the case
may be, its nominee or otherwise
enabling such person as Agent shall
select to exercise such voting
rights as shall be specified
(whether generally or specifically)
in the relevant notice.
4.3 Payment of Costs on Securities: The Chargor shall duly and promptly pay
all costs, instalments or other payments which from time to time become
due in respect of any Charged Property. In the case of any default by
the Chargor in this respect Agent may, if it thinks fit, make any such
payments on behalf of the Chargor, in which event any sums so paid shall
be reimbursed on demand by the Chargor to Agent and until reimbursed
shall bear interest in accordance with Clause 14.3 (Overdue Amounts) and
shall be secured on the Charged Property.
4.4 Collection of Distributions: At any time following the registration of
the Charged Property in the name of Agent or its nominee in accordance
with Clause 4.2.1, Agent shall not be under any duty to ensure that any
dividends, distributions or other monies payable in respect of the
Charged Property are duly or promptly paid or received by it or
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its nominee, or to verify that the correct amounts are paid or received,
or to take any action in connection with the taking up of any (or any
offer of any) stocks, shares, rights, monies or other property paid,
distributed, accruing or offered at any time by way of interest, dividend,
redemption, bonus, rights, preference, option, warrant or otherwise on, or
in respect of or in substitution for, any of the Charged Property.
4.5 Maintenance of Legal Validity: The Chargor shall obtain, comply with the
terms of and do all that is necessary to maintain in full force and effect
all authorisations, approvals, licences and consents required in or by the
laws and regulations of its jurisdiction of incorporation and England and
Wales to enable it lawfully to enter into and perform its obligations
under this Share Charge and to ensure the legality, validity,
enforceability or admissibility in evidence in its jurisdiction of
incorporation and England and Wales of this Share Charge.
5. NEGATIVE PLEDGE AND OTHER RESTRICTIONS
The Chargor shall not, without the prior written consent of Agent (save as
otherwise permitted by any UK Loan Document):
5.1 create, or agree or attempt to create, or permit to arise or subsist, any
lien of any kind (save for Permitted Liens) or any trust over any of the
Charged Property;
5.2 sell, transfer, assign or otherwise dispose of any of the Charged Property
or the equity of redemption in respect of the Charged Property; or
5.3 do or cause or permit to be done anything which may in any way materially
depreciate, jeopardise or otherwise materially prejudice the market value
or collateral value of the Charged Property or the rights of Agent on
behalf of the Lender Group hereunder.
6. FURTHER ASSURANCE
To the extent required to comply with the Loan Agreement, the Chargor
shall promptly following demand by Agent in writing, execute and deliver
to Agent at the cost of the Chargor and in such form as Agent may
reasonably require, such other documents as Agent may reasonably require
to perfect or protect this Share Charge or facilitate its realisation or
the exercise of Agent's rights thereunder, or following an Event of
Default which is continuing, to vest title to any Charged Property in
itself or its nominee or any purchaser and/or to create a legal mortgage
over the Securities or Derivative Assets and to register such security or
title in any applicable register in each case consistent with the
jurisdiction in which such asset is situated and/or to facilitate the
realisation of this security or Agent's rights under this Share Charge.
7. CONTINUING SECURITY
7.1 Continuing Security: This Share Charge shall be a continuing security,
notwithstanding any intermediate payment or settlement of account or any
other matter whatever, and shall be in addition to and shall not prejudice
or be prejudiced by any right of Lien, set-off or other rights exercisable
by Agent on behalf of the Lender Group or Agent on behalf
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of the Lender Group as banker against any Group Company or any Lien,
guarantee, indemnity and/or negotiable instrument now or in the future
held by Agent on behalf of the Lenders. Agent shall not be bound to
enforce any other Lien before enforcing the security created by this Share
Charge. Section 93 of the Law of Property Act 1925 shall not apply to this
Share Charge.
7.2 Subrogation: During the continuance of this Share Charge:
7.2.1 any rights of the Chargor, by reason of the performance of any of
its obligations under this Share Charge, the enforcement of any of
the charges contained herein or any action taken pursuant to any
rights of any person conferred by or pursuant to this Share Charge
or by law (so far as they relate to any of the Charged Property, the
Agent on behalf of the Lender Group as the person entitled to any of
the charges contained herein, any receiver or any delegate of the
Chargor):
7.2.1.1 to be indemnified by any person; or
7.2.1.2 to prove in respect of any liability in the winding-up of
any person; or
7.2.1.3 to take the benefit of or enforce any security interest or
guarantees or to exercise any rights of contribution,
(all such rights the "Subrogation Rights") shall be exercised and
enforced by the Chargor in such manner and on such terms, and only
in such manner and on such terms, as Agent may require (and, without
limitation, Agent shall be entitled to require the Chargor not to
exercise or enforce any Subrogation Rights);
7.2.2 any amount received by the Chargor as a result of any exercise of
any Subrogation Rights shall be held in trust for and immediately
paid to Agent on behalf of the Lender Group;
Provided that no Subrogation Rights shall arise or exist, which if they
did exist would constitute a right to be indemnified by, to prove in the
winding-up of, to take the benefit of any Lien or guarantee granted by, or
to exercise any rights of contribution against, Subsidiary Borrower, and
the Chargor waives all its entitlement and rights to or in respect of any
such Subrogation Rights.
8. Waiver of Defences
The liabilities and obligations of the Chargor under this Share Charge
shall remain in force irrespective of whatever dealings may occur between
the Agent, the Lenders, the Chargor and Subsidiary Borrower including,
without limitation, the granting of any additional time for the
performance of any obligation, or the variation of any obligation.
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9. POWERS OF SALE
9.1 Statutory Power of Sale to arise on Enforcement: Section 103 of the Law of
Property Act 1925 shall not apply to this Share Charge, but the statutory
power of sale (as varied and extended by this Share Charge) shall (as
between Agent and a purchaser from Agent), and the statutory power of
appointing a receiver of the Charged Property (or the income thereof)
shall, arise immediately on the execution of this Share Charge without the
restrictions contained in the Law of Property ▇▇▇ ▇▇▇▇ as to the giving of
notice or otherwise. However, Agent shall not exercise such powers until
the taking of action by the Agent under Clause 9 of the Loan Agreement,
but this provision shall not affect a purchaser or require him to ask
whether a demand or appointment has been made.
9.2 Third Parties not to be concerned with validity of demand: No person
dealing in good faith and for value with Agent, its agents or brokers,
shall be concerned to enquire whether this Share Charge has become
enforceable, or whether any power exercised or purported to be exercised
has become exercisable, or whether any Secured Sums remain due upon this
Share Charge or have been validly demanded, or as to the necessity or
expediency of any stipulations and conditions subject to which the sale of
any Charged Property shall be made, or otherwise as to the propriety or
regularity of the sale of any Charged Property, or to see to the
application of any money paid to Agent, or its agents or brokers, and each
such dealing shall be deemed to be within the powers hereby conferred and
to be valid and effective accordingly.
10. OPENING OF NEW ACCOUNTS
10.1 Ruling off of Accounts: On receiving notice that the Chargor has
encumbered or disposed of any of the Charged Property, Agent may rule off
such Chargor's account or accounts and open a new account or accounts in
the name of the Chargor.
10.2 Credits not to reduce Indebtedness of Chargor: If Agent does not open a
new account or accounts immediately on receipt of such notice, it shall
nevertheless be treated as if it had done so at the time when it received
such notice and as from that time all payments made by the Chargor to
Agent on behalf of the Lender Group shall be treated as having been
credited to such new account or accounts and shall not operate to reduce
the amount owing from the Chargor to Agent on behalf of the Lender Group
at the time when it received such notice.
11. ENFORCEMENT
11.1 Statutory Powers: The powers conferred on mortgagees or receivers by the
Law of Property ▇▇▇ ▇▇▇▇ and the Insolvency ▇▇▇ ▇▇▇▇ shall apply to the
security constituted by this Share Charge except insofar as they are
expressly or impliedly excluded and where there is ambiguity or conflict
between the powers contained in such statutes, in which case those powers
contained in this Share Charge shall prevail.
11.2 Liability of Agent: Neither the Agent nor any receiver or delegate shall
be liable to account as mortgagee in possession or otherwise for any money
not actually received by it.
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11.3 Redemption of Prior Charges: Agent at any time following the security
constituted by this Share Charge becoming enforceable may redeem any and
all prior Liens on or relating to the Charged Property or any part thereof
or procure the transfer of such Liens to itself and may settle and pass
the accounts of the person or persons entitled to the prior Liens. Any
account so settled and passed shall be conclusive and binding on the
Chargor.
11.4 Rights of Agent: All or any of the rights which are conferred by this
Share Charge (either expressly or impliedly) upon a receiver may be
exercised after the Share Charge becomes enforceable by Agent irrespective
of whether Agent shall have taken possession or appointed a receiver of
the Charged Property.
12. POWER OF ATTORNEY
12.1 Power of Attorney: The Chargor by way of security hereby irrevocably
appoints Agent (whether or not a receiver has been appointed), and any
receiver separately, as the attorney of the Chargor (with full power to
appoint substitutes and to delegate), in its name and on its behalf, and
as its act and deed or otherwise, at any time during the continuance of an
Event of Default to:
12.1.1 execute and deliver and otherwise perfect any agreement, assurance,
deed, instrument or document; or
12.1.2 perform any act;
which may be required of the Chargor under this Share Charge, or may be
deemed necessary by such attorney, acting reasonably, for any purpose of
this Share Charge or to enhance or perfect the security intended to be
constituted by it or following an Event of Default, to convey or transfer
legal ownership of any of the Charged Property (including the completion
of the stock transfer forms referred to in Clause 4.1 (Deposit of
Documents)).
12.2 Ratification: The Chargor undertakes, if so required, to ratify and
confirm all acts done and transactions entered into by any attorney
appointed under Clause 12.1 (Power of Attorney) in the proper exercise of
its powers in accordance with this Share Charge.
12.3 Delegation: Agent may delegate by power of attorney or in any other manner
all or any of the powers, authorities and discretions which are for the
time being exercisable by Agent under this Share Charge to any person or
persons which it shall think fit and on such terms and conditions as it
shall think fit (including power to sub-delegate) without liability for
any act or omission by such delegate.
13. APPLICATION OF MONEY RECEIVED
13.1 Application of Recoveries: Any money received under the powers conferred
by this Share Charge shall, subject to the discharge of any prior-ranking
claims, be paid or applied in the following order of priority:
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13.1.1 in satisfaction of all costs, charges and expenses incurred, and
payments made by Agent in connection with the exercise of its
rights under this Share Charge (including any costs, charges and
expenses incidental to the appointment of a receiver and the
exercise of a receiver's rights and all remuneration payable to a
receiver or liabilities of a receiver);
13.1.2 in or towards satisfaction of the Secured Sums in the manner
applicable under the UK Loan Documents; and
13.1.3 as to the surplus (if any), to the person or persons entitled to
it.
13.2 Suspense Account: Agent may, in its absolute discretion on or at any time
or times pending the payment to the Lender Group of the whole of the
Secured Sums, place and keep to the credit of a separate or suspense
account, bearing interest at a commercial rate, any money received,
recovered or realised by Agent on behalf of the Lender Group by virtue of
this Share Charge in such manner as Agent may consider necessary to enable
it to claim the full amount in respect of which that money is paid in any
relevant insolvency without any obligation to apply it in or towards the
discharge of any Secured Sum. That amount may be kept there (with any
interest earned being credited to that account) until Agent is satisfied
that all the Secured Sums have been discharged in full and that all
facilities which might give rise to Secured Sums have terminated.
14. COSTS AND INTEREST ON OVERDUE AMOUNTS
14.1 Indemnity: All costs, charges and liabilities (including all properly
incurred professional fees and disbursements and value added tax and/or
any similar tax) and all other sums paid or incurred by Agent or the
Lender Group under or in connection with this Share Charge or the UK Loan
Documents, shall be recoverable (on a full indemnity basis) as a debt
payable on demand from the Chargor, may be debited following non-payment
of such sum(s) by the Chargor when due, or, if relevant, when demanded,
without notice to any account of the Chargor, shall bear interest in
accordance with the provisions of the UK Loan Documents and shall be
charged on the Charged Property. The Chargor shall indemnify Agent or the
Lender Group against all properly incurred costs, charges and expenses
arising out of any proceedings referable to the Chargor brought against
Agent or the Lender Group or to which Agent or the Lender Group may be a
party whether as plaintiffs or defendants or otherwise and which relate to
any Charged Property. All amounts paid by the Chargor under this Share
Charge shall be paid free and clear of any deduction or withholding on
account of tax or any other amount (save to the extent required by law)
and free of any set-off or counterclaim or otherwise. If the Chargor is
required to make any deduction or withholding by law on any sum paid or
payable by it to Agent on behalf of the Lenders under this Share Charge
the sum payable by the Chargor in respect of which the deduction or
withholding is required shall be increased to the extent necessary to
ensure that Agent or the Lender Group receives on the due date and retains
(free of any liability in respect of such deduction or withholding) a net
sum equal to the sum it would have received and retained had no such
deduction or withholding been required or made except where such deduction
or withholding is permitted by the terms of the Loan Agreement and there
is no
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corresponding obligation on the Subsidiary Borrower in the Loan Agreement
to account to the Lender or Agent for such sum that has been withheld or
deducted.
14.2 Types of Costs Recoverable: The costs recoverable by Agent under this
Share Charge shall include:
14.2.1 all costs properly incurred in preparing and administering this
Share Charge or perfecting the security created by it;
14.2.2 all costs (whether or not allowable on a taxation by the court) of
all proceedings for the enforcement of this Share Charge or for the
recovery or attempted recovery of the Secured Sums;
14.2.3 all money properly expended and all properly incurred costs arising
out of the exercise of any power, right or discretion conferred by
this Share Charge; and
14.2.4 all costs and losses arising from any default by the Chargor in the
payment when due of any Secured Sums or the performance of its
obligations under this Share Charge.
14.3 Overdue Amounts: Any overdue amounts secured by this Share Charge shall
carry interest at the rate and in accordance with the terms contained in
the UK Loan Documents in relation to overdue sums provided under Section
2.6(c) of the Loan Agreement or at such other rate agreed between the
Chargor and Agent from time to time. In each case, such interest shall
accrue on a day to day basis to the date of repayment in full and, if
unpaid, shall be compounded on the terms so agreed (or in the absence of
such agreed terms with monthly rests on Agent's usual monthly interest
days). Interest shall continue to be charged and compounded on this basis
after as well as before any demand or judgment.
14.4 Currency Indemnity:
14.4.1 Moneys received or held by Agent pursuant to this Share Charge may,
from time to time after demand has been made, be converted into
such currency as Agent considers necessary or desirable to
discharge the Secured Sums in that currency at such rate of
exchange as may be applicable under the Loan Agreement or, if there
is none, the prevailing spot rate of exchange of ▇▇▇▇▇ Fargo Bank,
N.A. or any successor thereto (as conclusively determined by Agent
in accordance with the Loan Agreement) for purchasing the currency
to be acquired with the existing currency.
14.4.2 No payment to Agent (whether under any judgment or court order or
otherwise) shall discharge the obligation or liability in respect
of which it was made unless and until Agent shall have received
payment in full in the currency in which such obligation or
liability was incurred, and to the extent that the amount of any
such payment shall on actual conversion into such currency fall
short of such obligation or liability expressed in that currency,
Agent on behalf of the Lender Group shall have a further separate
cause of
12
action against the Chargor and shall be entitled to enforce this
security to recover the amount of the shortfall.
To the extent that the amount of any such payment shall on actual
conversion into such currency exceed such obligation or liability
expressed in that currency, Agent shall repay that excess to the Chargor.
15. SET-OFF
15.1 Agent may at any time or times during the continuance of an Event of
Default retain any money standing to the credit of the Chargor in any
currency upon any account or otherwise (in any country and whether or not
in the Chargor's name) as cover for any Secured Sums and at any time after
an Event of Default without notice to the Chargor, and may set off,
combine and/or consolidate all or any of such money with all or such part
of the Secured Sums as Agent may select (whether presently payable or
not), and purchase with any such money any other currency required to
effect such combination.
15.2 The Chargor irrevocably authorises Agent in its name and at its expense to
perform such acts and sign such documents as may be required to give
effect to any set-off or transfer pursuant to Clause 15.1, including the
purchase with the money standing to the credit of any such account of such
other currencies as may be necessary to effect such set off or transfer.
15.3 The foregoing provisions of this clause shall be in addition to and
without prejudice to such rights of set off, combination, consolidation,
lien and other rights whatsoever conferred on the Lender Group by law.
16. TRANSFER
Agent may transfer all or any part of its rights in relation to this Share
Charge and the Secured Sums or otherwise grant an interest in them to any
person to which it is entitled to make such a transfer under the Loan
Agreement.
17. DISCLOSURE
The Chargor irrevocably authorises Agent, at its discretion, at any time
or from time to time, to disclose any information concerning the Chargor,
this Share Charge and the Secured Sums to any prospective transferee or
grantee referred to in Clause 16 (Transfer), or to any affiliate of the
Agent or the Lenders and their officers, directors, employers, agents and
advisors subject to such person undertaking to the Chargor, in manner,
form and substance reasonably satisfactory to such Chargor, to keep such
information confidential. Both Agent and any prospective transferee or
grantee shall be entitled to disclose such information to their
professional advisers.
The above authority is without prejudice to any obligation of Agent to
make disclosure imposed by law.
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18. FORBEARANCE AND SEVERABILITY
18.1 No Waivers: All rights, powers and privileges under this Share Charge
shall continue in full force and effect, regardless of the Agent
exercising, delaying in exercising or omitting to exercise any of them.
18.2 Invalidity and Severability:
18.2.1 None of the covenants and guarantees given and none of the charges
created by the Chargor under this Share Charge shall be avoided or
invalidated by reason only of one other or more of such covenants,
guarantees or charges being invalid or unenforceable.
18.2.2 Any provision of this Share Charge which for any reason is or
becomes illegal, invalid or unenforceable shall be ineffective only
to the extent of such illegality, invalidity and unenforceability,
without invalidating the remaining provisions of this Share Charge
or the effectiveness of any provisions of this Share Charge under
the laws of any jurisdiction.
19. VARIATIONS AND CONSENTS
19.1 Variations in Writing: No variation of this Share Charge shall be
considered valid and as constituting part of this Share Charge, unless
such variation shall have been made in writing and signed by Agent and the
Chargor.
19.2 Variation: The expression "variation" shall include any variation,
supplement, extension, deletion or replacement however effected.
19.3 Conditional Consents: Save as otherwise expressly specified in this Share
Charge or the Loan Agreement, any consent of Agent may be given absolutely
or on any terms and subject to any conditions as Agent may determine in
its entire discretion.
20. SERVICE OF DEMANDS AND NOTICES
20.1 Notices to the Chargor: A demand for payment or any other communication to
be given to the Chargor under this Share Charge may be made or given by
any manager or officer of Agent and must be in writing addressed to the
Chargor served on it at the address for service of the Chargor stated in
the Second Schedule, or to the address last notified to Agent by the
Chargor, or by facsimile transmission to the facsimile number stated in
the Second Schedule, or to the facsimile number last notified to Agent by
the Chargor or by any other form of electronic communication which may be
available.
20.2 Notices to Agent: Any communication to be given to Agent under this Share
Charge must be given to Agent in writing served on it at ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ West, Santa ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
(marked for the attention of Business Finance Division Manager) or by
facsimile to facsimile number 00 1 310 453 7443 or the address or
facsimile number last notified to the Chargor by Agent in writing.
14
20.3 Deemed Service: A notice or demand shall be deemed to be duly served on
the Chargor:
20.3.1 if delivered by hand, at the time of actual delivery;
20.3.2 if transmitted by facsimile, at the time the facsimile transmission
report (or other appropriate evidence) confirming that the
facsimile has been transmitted to the addressee is received by the
sender; or
20.3.3 if sent by first class prepaid post, at noon on the third Business
Day (or if sent by airmail, the fifth Business Day) following the
day of posting and shall be effective even if it is misdelivered or
returned undelivered;
provided that, where delivery or transmission occurs after 6.00 pm in the
place of delivery on a Business Day or on a day which is not a Business
Day, service shall be deemed to occur at 9.00 am in the place of delivery
on the next Business Day.
In proving such service, it shall be sufficient to prove that personal
delivery was made or that the envelope containing the communication was
correctly addressed and posted or that a facsimile transmission report (or
other appropriate evidence) was obtained that the facsimile had been
transmitted to the addressee.
20.4 Service on Agent: Any communication to Agent shall be deemed to have been
given only on actual receipt by it.
21. COUNTERPARTS
This Share Charge may be executed by the parties in any number of copies,
all of which taken together shall constitute a single Share Charge.
22. ADJUSTMENT OF ACCOUNT
If the statement of account between Agent and the Chargor by reference to
which any Secured Sums are calculated for the purposes of this Share
Charge requires adjustment at any time because of any claim made against
Agent by an officeholder (within the meaning of Section 234 of the
Insolvency Act 1986) then, notwithstanding any other provision of this
Share Charge:
22.1 the Chargor's liability to Agent will be correspondingly adjusted;
22.2 Agent may treat any release or settlement made by it with the Chargor
before any such adjustment is required as being of no effect; and
22.3 Agent may recover from the Chargor such sum as will place the Lender Group
in the same position as if such release or settlement had not been made.
If any claim is made against Agent under any insolvency law with reference to
this Share Charge, Agent may agree the claim or settle it on any terms it
chooses without asking for the Chargor's agreement. If Agent does agree or
settle such claim, the Chargor will be liable under
15
this Share Charge as if a court order had been made containing the terms
which Agent agreed or settled. The Chargor will be responsible for all
costs and expenses which Agent or the Lender Group properly incurred in
defending such a claim.
23. REPRESENTATIONS AND WARRANTIES
23.1 Representations and Warranties: The Chargor represents and warrants to
Agent that:
23.1.1 the Chargor is the sole, absolute and beneficial owner of the
Charged Property, that no person save the Chargor has any right or
interest of any sort whatsoever in or to the Charged Property and
that there are no agreements or arrangements (including any
restrictions on transfer or rights of pre-emption) affecting the
Charged Property which would in any way ▇▇▇▇▇▇ the rights of the
Chargor under this Share Charge;
23.1.2 the Securities are duly authorised, validly issued and fully paid
and there are no monies or liabilities outstanding in respect of
any of the Securities;
23.1.3 the Securities constitute 100% of the entire issued ordinary share
capital of Subsidiary Borrower, and constitute 100% of all of the
shares in Subsidiary Borrower owned legally or beneficially by the
Chargor;
23.1.4 the transfer of the Securities or the charge over the Securities,
each as contemplated by this Share Charge, is not prohibited by the
constitutional documents of the Chargor;
23.1.5 the Chargor is validly incorporated under the laws of the Republic
of Ireland and has the power and authority to enter into, perform
and deliver this Share Charge and the arrangements contemplated
hereby;
23.1.6 this Share Charge constitutes its legal, valid and binding
obligations, enforceable in accordance with its terms except as
enforcement may be limited by equitable principles or by insolvency
or similar laws relating to or limiting the rights of creditors
generally;
23.1.7 in any proceedings taken in its jurisdiction of incorporation in
relation to this Share Charge, the choice of English law as the
governing law of this Share Charge and any judgment obtained in
England will be recognised and enforced;
23.1.8 the Chargor has not taken any corporate action nor have any other
steps been taken or legal proceedings been started or (to the best
of its knowledge and belief) threatened against it for its
winding-up, dissolution, administration or re-organisation or for
the appointment of a receiver, administrator, administrative
receiver, trustee or similar officer of it or of any or all of its
assets or revenues;
23.1.9 its execution of this Share Charge and exercise of its rights and
performance of
16
its obligations hereunder will not result in the existence of nor
oblige it to create any Lien over all or any of its present or
future revenues or assets otherwise than as contemplated hereby;
and
23.1.10 its execution of this Share Charge constitutes, and its exercise
of its rights and performance of its obligations hereunder will
constitute, private and commercial acts done and performed for
private and commercial purposes.
23.2 Times of Making Representations and Warranties: The representations and
warranties set out in Clause 23.1 (Representations and Warranties):
23.2.1 will survive the execution of each UK Loan Document and each
drawdown under the Loan Agreement; and
23.2.2 are made on the date hereof and are deemed to be repeated in
accordance with Section 3.3(a) (Conditions Precedent to all
Extensions of Credit) of the Loan Agreement with reference to the
facts and circumstances then existing.
24. GOVERNING LAW AND SUBMISSION TO JURISDICTION
24.1 Governing Law: Any dispute, controversy, proceedings or claim of whatever
nature arising out of or relating to, or breach of, this Share Charge
shall be governed by and this Share Charge shall be construed in all
respects in accordance with English law.
24.2 Submission to Jurisdiction:
24.2.1 The Chargor irrevocably submits for the benefit of Agent to the
non-exclusive jurisdiction of the courts of England for the
purpose of hearing and determining any proceedings arising out of
this Share Charge.
24.2.2 The Chargor hereby designates, appoints and empowers the Subsidiary
Borrower at ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇ (or such other
address in England as it may notify to Agent), marked for the
attention of the company secretary, as its process service agent to
accept service of process in England in any proceedings, and agrees
that failure by such agent to give notice of such service of
process to the Chargor shall not impair or affect the validity of
such service or any judgment based on it. If the appointment ceases
to be effective in respect of the Chargor, the Chargor shall
immediately appoint a further person in England to accept service
of process on its behalf in England and, if it fails to make such
appointment within 15 days, Agent shall be entitled to appoint such
person by notice to the Chargor.
24.2.3 The Chargor irrevocably agrees not to claim that any such court is
not a convenient or appropriate forum and agrees that a judgment in
proceedings brought in such courts shall be conclusive and binding
upon them and may be enforced in any other jurisdiction.
24.3 Freedom of Choice: The submission to the jurisdiction of the courts
referred to in
17
Clause 24.2 (Submission to Jurisdiction) shall not (and shall not be
construed so as to) limit the right of Agent to take proceedings against
the Chargor in the courts of any country in which the Chargor has assets
or in any other court of competent jurisdiction nor shall the taking of
proceedings in any one or more jurisdictions preclude the taking of
proceedings in any other jurisdiction (whether concurrently or not) if and
to the extent permitted by applicable law.
24.4 Trial by Jury: Each of the parties to this Share Charge waives trial by
jury in any proceedings arising out of or related to this Share Charge
whether arising before or at any time after the date of this Share Charge.
25. THIRD PARTIES
Save as expressly provided herein, a person who is not a party to this
Share Charge has no right under the Contracts (Rights of Third Parties)
▇▇▇ ▇▇▇▇ to enforce or enjoy the benefit of this Share Charge.
THIS SHARE CHARGE has been executed by the Chargor as a Deed and signed by Agent
but shall only be treated as having been executed and delivered to take effect
on the day and year first above written.
18
CHARGOR
PRESENT when the Common Seal of )
PALM IRELAND INVESTMENT )
(pursuant to a resolution of its board of ) /s/ ▇▇▇▇ ▇▇▇▇▇▇
directors) was affixed hereto: ) ---------------
(Authorised Officer)
/s/ ▇▇▇▇▇▇▇ ▇▇
--------------------------
(Authorised Officer)
) Common Seal:
)
)
)
--------------------------------------------
(Authorised Officer)
--------------------------------------------
(Authorised Officer)
Common Seal:
AGENT
SIGNED by )
for and on behalf of ) ▇▇▇▇ ▇▇▇▇▇▇
FOOTHILL CAPITAL ) Vice President
CORPORATION as Agent )
/s/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------------
(Authorised Officer)
19
THE FIRST SCHEDULE
The Securities
100,000 Ordinary shares of (pound)1 each in the capital of Palm Europe
20
