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Exhibit 10.8
DATED May 26, 1999
EURO 45,378,022
LOAN AGREEMENT
for
VERSATEL TELECOM EUROPE B.V.
GUARANTEED BY
VERSATEL TELECOM INTERNATIONAL
N.V. AND OTHERS
AGENT AND SECURITY AGENT
NORTEL NETWORKS INTERNATIONAL
FINANCE & HOLDING B.V.
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CONTENTS
CLAUSE HEADING PAGE
1 Interpretation................................................................................1
1.1 Definitions..........................................................................1
1.1 Interpretation......................................................................22
1.2 Majority Lenders....................................................................23
1.3 Agent's opinion.....................................................................23
2 The Facility.................................................................................23
2.1 The Facility........................................................................23
2.2 Purpose.............................................................................24
3 Conditions...................................................................................24
3.1 Documentary conditions precedent....................................................24
3.2 Further conditions..................................................................24
3.3 Waiver of conditions precedent......................................................24
3.4 Notification........................................................................25
4 The Loan.....................................................................................25
4.1 Drawdown............................................................................25
4.2 Amount of Advances..................................................................25
4.3 Termination of Commitments..........................................................26
4.4 Notification to Lenders.............................................................26
4.5 Application of proceeds.............................................................26
5 Repayment....................................................................................26
6 Prepayment...................................................................................26
6.1 Voluntary Prepayments...............................................................26
6.2 Additional voluntary prepayment.....................................................26
6.3 Mandatory Prepayment................................................................27
6.4 Application of prepayments to repayment instalments.................................28
6.5 Amounts payable on prepayment.......................................................28
6.6 Cancellation........................................................................28
6.7 Application of mandatory prepayments................................................29
6.8 Prepayments generally...............................................................29
7 Interest.....................................................................................29
7.1 Dates of payment....................................................................29
7.2 Rates of interest...................................................................29
7.3 Applicable Margin...................................................................29
7.4 Determination of Interest Periods...................................................30
7.5 Notification by the Agent...........................................................31
8 Interest for late payment....................................................................31
8.1 The Borrower's obligation to pay....................................................31
8.2 Normal rate.........................................................................31
8.3 Initial rate on acceleration of the Loan............................................31
8.4 Date of payment.....................................................................31
8.5 Notification by the Agent...........................................................31
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9 Fees and expenses............................................................................31
9.1 Facility fee........................................................................31
9.2 Commitment commission...............................................................31
9.3 Expenses............................................................................32
9.4 Stamp and other duties..............................................................32
9.5 VAT.................................................................................32
10 Guarantee....................................................................................32
10.1 Covenant to pay.....................................................................32
10.2 Guarantors as principal debtors; indemnity..........................................33
10.3 Limitation..........................................................................33
10.4 No security taken by Guarantors.....................................................34
10.5 Interest............................................................................34
10.6 Continuing security and other matters...............................................34
10.7 New accounts........................................................................34
10.8 Liability unconditional.............................................................34
10.9 Collateral Instruments..............................................................35
10.10 Waiver of Guarantors' rights........................................................35
10.11 Suspense accounts...................................................................36
10.12 Settlements conditional.............................................................36
10.13 Guarantors to deliver up certain property...........................................36
10.14 Retention of this guarantee.........................................................36
10.15 Changes in constitution or reorganisations of Lenders...............................36
10.16 Other Guarantors....................................................................37
10.17 Acceding Guarantors.................................................................37
11 Representations..............................................................................38
11.1 Representations.....................................................................38
11.2 Due incorporation...................................................................38
11.3 The Documents.......................................................................38
11.4 Litigation..........................................................................38
11.5 The Accounts........................................................................39
11.6 Works councils......................................................................39
11.7 Choice of law.......................................................................39
11.8 Title to assets.....................................................................39
11.9 Intellectual Property Rights........................................................39
11.10 Project Agreements..................................................................40
11.11 Licences and Necessary Authorisations...............................................40
11.12 No withholding Taxes................................................................40
11.13 Telecommunications Laws.............................................................40
11.14 Environmental Matters...............................................................40
11.15 Information.........................................................................40
11.16 Notes...............................................................................41
11.17 Year 2000 Issue.....................................................................41
11.18 Books and records...................................................................41
11.19 Business Plan.......................................................................41
11.20 Default.............................................................................41
11.21 Repetition..........................................................................41
12 Information Undertakings.....................................................................42
12.1 General.............................................................................42
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12.2 Defaults............................................................................43
13 Undertakings.................................................................................43
13.1 Obligors' undertakings..............................................................43
13.2 Purpose.............................................................................43
13.3 Consents............................................................................43
13.4 Compliance with licences etc. relating to the business of the Group.................43
13.5 Pari passu..........................................................................44
13.6 Insurance...........................................................................44
13.7 Environmental Licences..............................................................44
13.8 Environmental Claims................................................................44
13.9 Relevant Substances.................................................................44
13.10 Year 2000...........................................................................45
13.11 Intellectual Property Rights........................................................45
13.12 Change in basis of accounts.........................................................46
13.13 Financial Year End..................................................................46
13.14 Authorised Officers.................................................................47
13.15 Auditors............................................................................47
13.16 Inspection..........................................................................47
13.17 Taxes...............................................................................47
13.18 Subordination of loans from Subordinated Creditor...................................47
13.19 Business Plan.......................................................................47
13.20 Working capital.....................................................................48
13.21 Business............................................................................48
13.22 Maintenance of Systems and Software.................................................48
13.23 Permitted Acquisitions..............................................................48
14 Negative undertakings........................................................................49
14.1 Obligors' undertakings..............................................................49
14.2 Negative pledge.....................................................................49
14.3 Senior Debt and guarantees..........................................................49
14.4 Disposals...........................................................................50
14.5 Loans and guarantees................................................................50
14.6 Equity yield........................................................................50
14.7 Shareholders' meetings..............................................................50
14.8 New share issues....................................................................50
14.9 Amalgamation and merger.............................................................51
14.10 Change in business..................................................................52
14.11 Acquisitions and joint-ventures.....................................................52
14.12 Swaps and hedging...................................................................52
15 Operational and Financial covenants..........................................................52
15.1 Operational and Financial covenants.................................................52
15.3 Post Annualised Consolidated EBITDA position........................................55
15.4 Auditors certificate................................................................56
16 Default......................................................................................57
16.1 Events of Default...................................................................57
16.2 The Finance Documents...............................................................57
16.3 Cross-default.......................................................................58
16.4 Financial position..................................................................59
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16.5 Insolvency procedures...............................................................59
16.6 Legal process.......................................................................59
16.7 Compositions........................................................................60
16.8 Litigation..........................................................................60
16.9 Material Adverse Change.............................................................60
16.10 Abandonment of the Project..........................................................60
16.11 Project Agreements..................................................................60
16.12 Environmental matters...............................................................61
16.13 Telecommunications Laws.............................................................61
16.14 Licences............................................................................61
16.15 Restricted Persons..................................................................61
16.16 Consequences of Event of Default....................................................62
17 Payments.....................................................................................62
17.1 Payments by the Obligors............................................................62
17.2 Payments in the wrong currency......................................................63
17.3 Partial payments....................................................................63
17.4 Pro-rata payments...................................................................64
17.5 No release..........................................................................65
17.6 No charge...........................................................................65
17.7 Reconventioning.....................................................................65
18 Taxes........................................................................................65
18.1 Grossing-up.........................................................................65
18.2 Qualifying Person...................................................................66
18.3 Claw-back of Tax benefit............................................................66
19 Indemnity....................................................................................66
19.1 General indemnities.................................................................66
19.2 Environmental indemnity.............................................................67
20 Set-off......................................................................................67
20.1 Set-off.............................................................................67
20.2 Purchase of currencies..............................................................67
20.3 Notification........................................................................67
21 Calculations and certificates................................................................67
21.1 Calculations........................................................................67
21.2 Certificates........................................................................67
22 Market disruption............................................................................68
22.1 Problems with EURIBOR; unavailability of funds......................................68
23 Changes in Regulation........................................................................69
23.1 Circumstances when this clause applies..............................................69
23.2 Obligation to compensate the Lender.................................................69
23.3 Exceptions..........................................................................69
23.4 Mitigation..........................................................................70
23.5 Illegality..........................................................................70
24 Transfer.....................................................................................70
24.1 No transfers by the Obligors........................................................70
24.2 Transfers by the Lender: Transfer Agreements........................................70
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24.3 Reliance on Transfer Certificate....................................................71
24.4 Authorisation of Agent..............................................................72
24.5 Construction of certain references..................................................72
24.6 Lending offices.....................................................................72
24.7 Disclosure of information...........................................................72
24.8 Confidentiality undertaking.........................................................72
24.9 Limitation on certain obligations...................................................73
24.10 Restrictions on transfers...........................................................73
24.11 Sub-participation...................................................................73
25 Agent, Security Agent and Reference Banks....................................................73
25.1 Appointment of Agent................................................................73
25.2 Agent's actions.....................................................................74
25.3 Agent's duties......................................................................74
25.4 Agent's rights......................................................................74
25.5 No liability of Security Agent and Agent............................................75
25.6 Non-reliance on Security Agent or Agent.............................................76
25.7 No Responsibility on Security Agent or Agent for certain matters....................76
25.8 Reliance on documents and professional advice.......................................77
25.9 Other dealings......................................................................77
25.10 Rights of Agent and Security Agent as Lender; no partnership........................77
25.11 Amendments and waivers..............................................................78
25.12 Reimbursement and indemnity by Lenders..............................................79
25.13 Retirement of Agent.................................................................79
25.14 Change of Reference Banks...........................................................80
25.15 Prompt distribution of proceeds.....................................................80
26 Decisions of Lenders and Agent...............................................................81
26.1 Obligations several.................................................................81
26.2 Interests several...................................................................81
26.3 Majority Lenders....................................................................81
26.4 Lenders acting together.............................................................82
27 Notices and other matters....................................................................82
27.1 Address for Notice..................................................................82
27.2 Notice to Agent.....................................................................83
27.3 No implied waiver, remedies cumulative..............................................83
27.4 Counterparts........................................................................83
28 Governing Law and Jurisdiction...............................................................83
28.1 Law.................................................................................83
28.2 Submission to jurisdiction..........................................................83
28.3 Agent for service of process........................................................84
28.4 Inconvenient forum..................................................................84
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SCHEDULE
1 Part A - Initial administrative details of the Banks.........................................85
Part B - Original Guarantors.................................................................86
2 Form of Drawdown Notice......................................................................87
3 Part A - Documents and evidence required as conditions precedent to first Advance............88
Part B - Documents and evidence required as conditions precedent to Advance in respect
of Reunion Equipment.........................................................................90
4 Calculation of UK Additional Cost............................................................91
5 Form of Transfer Certificate.................................................................93
6 Compliance Certificate to be delivered by an Authorised Officer of the Borrower..............97
7 Project Agreements...........................................................................99
8 Licences....................................................................................100
9 Part A - Deed of Guarantor Accession........................................................101
Part B - Documents and Evidence to be delivered by an Acceding Guarantor....................103
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THIS AGREEMENT is dated May 26, 1999 and made BETWEEN:
(1) VERSATEL TELECOM EUROPE B.V. as the Borrower;
(2) VERSATEL TELECOM INTERNATIONAL N.V. and others as Original Guarantors as set
out in part B of schedule 1;
(3) THE LENDERS whose names and addresses are set out in part A of schedule 1;
(4) NORTEL NETWORKS INTERNATIONAL FINANCE & HOLDING B.V. as Agent; and
(5) NORTEL NETWORKS INTERNATIONAL FINANCE & HOLDING B.V. as Security Agent.
IT IS AGREED as follows:
1 INTERPRETATION
1.1 DEFINITIONS
In this Agreement, the following expressions have the meanings set
opposite them:
ACCEDING GUARANTORS those entities which have become
party to this Agreement as
Guarantors pursuant to clause 10.17
ACCOUNTS the audited consolidated annual
accounts of the Group
ADDITIONAL COST in respect of all Lenders, in
relation to any period a percentage
calculated for such period at an
annual rate determined in accordance
with schedule 4
ADVANCE each borrowing under the Facility or
(as the context requires) the
principal amount of that borrowing
outstanding at any relevant time
AGENT NNIF or such other person as may be
appointed agent for the Lenders
pursuant to clause 25.13 and, in
each case, its successors in title
ANNUAL BUDGET the budget in respect of the Group
for each financial year in the
agreed form
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ANNUALISED CONSOLIDATED EBITDA two times the aggregate Consolidated
EBITDA of the Group for the two most
recent Quarterly Periods in respect
of which Quarterly Management
Accounts have been delivered to the
Agent under this Agreement
ASSET CHARGES the pledges/charges in the agreed
form entered or to be entered into
by the Borrower and certain of its
Subsidiaries over the Equipment in
favour of the Security Agent
ASSOCIATED COMPANY of a person means (i) any other
person which is directly or
indirectly controlled by, under
common control with or controlling
such person or (ii) any other person
owning beneficially and/or legally
directly or indirectly 10 per cent.
or more of the equity interest in
such person or 10 per cent. of whose
equity interest is owned
beneficially and/or legally directly
or indirectly by such person. For
the purposes of this definition the
term "control" means possession,
directly or indirectly, of the power
to direct or cause the direction of
the management and policies of a
person whether through the ownership
of interests or voting securities,
by contract or otherwise
AUTHORISED OFFICER in relation to an Obligor, that
officer or officers of the Obligor
authorised to sign Compliance
Certificates, Drawdown Notices and
other notices, requests, or
confirmations referred to in this
Agreement or relating to the
Facility
AVAILABLE COMMITMENT in relation to a Lender at any time,
its Commitment less its Contribution
at that time
AVAILABILITY PERIOD the period from the date of this
Agreement until 31 December 2000
BANKING DAY (a) a day (other than a
Saturday or a Sunday) on
which banks are open for
business in London and
Amsterdam; or
(b) in relation to rate fixing
a day on which
Trans-European Automated
Real-time Gross Settlement
Express Transfer system
(TARGET) is operating
BORROWED MONEY any transaction having the economic
effect of a borrowing or raising of
money
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BORROWER VersaTel Telecom Europe B.V.
(incorporated in The Netherlands
with number 33303418) and having its
statutory seat (statutaire zetel) at
Amsterdam, The Netherlands, and its
registered office at ▇▇▇▇▇▇▇▇▇▇▇ ▇▇,
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
BORROWER GROUP the Borrower and its Subsidiaries
BUSINESS PLAN the year by year financial
projections of the Borrower and its
Subsidiaries for the period through
to 31 December 2005 in the agreed
form, as approved by the supervisory
board of the Borrower and (without
prejudice to clause 13.23) as
amended with the approval of the
supervisory board of the Borrower
from time to time, with the consent
of the Majority Lenders such consent
not to be unreasonably withheld,
provided that the Borrower shall
have reviewed with the Lenders the
revised material assumptions made in
providing such amendments and the
Majority Lenders shall not have
demonstrated that such assumptions
are unreasonable
BUSINESS SUBSCRIBER a Subscriber who subscribes for
services at a business tariff or
wholesale tariff with the relevant
Group Member or subscribes to an
entity acquired pursuant to clause
13.23 which would be categorised as
subscribing for services at a
business tariff or wholesale tariff
if it was a Subscriber of the
Borrower
CHANGE OF CONTROL has the meaning given to it in
Section 1.1 of the indenture dated 3
December, 1998 in respect of the
November Notes (in their original
form)
COLLATERAL INSTRUMENTS notes, bills of exchange,
certificates of deposit and other
negotiable and non-negotiable
instruments, guarantees and any
other documents or instruments which
contain or evidence an obligation
(with or without security) to pay,
discharge or be responsible directly
or indirectly for, any Indebtedness
or liabilities under this Agreement
and includes Encumbrances
COMMITMENT in relation to a Lender at any
relevant time, the amount set
opposite its name in schedule 1
and/or, in the case of a Transferee,
the amount transferred as specified
in the relevant Transfer Certificate
as
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reduced, in each case, by any
relevant term of this Agreement
COMPLIANCE CERTIFICATE a certificate substantially in the
form set out in schedule 6 in
relation to the compliance (or
otherwise) with the undertakings in
clause 15 issued by an Authorised
Officer of the Borrower in relation
to Quarterly Management Accounts
CONSOLIDATED EBITDA means, in respect of any period, the
consolidated profit (i) on ordinary
activities of the Group or (ii)
attributable to an acquisition or
investment referred to in clause
13.23 before Taxation and after
operating expenses adjusted as
follows:
(a) before interest received or
receivable but excluding
interest paid or payable
and other similar income or
costs to the extent not
already excluded;
(b) before any charge for the
amortisation of goodwill or any
other intangible asset;
(c) before deducting any
exceptional or extraordinary
costs and before including
exceptional or extraordinary
income;
(d) before the depreciation of
fixed assets; and
(e) before any foreign exchange
losses or gains
CONTRIBUTION in relation to a Lender, the
principal amount of the Loan owing
to such Lender at any relevant time
CURRENT ASSETS at any relevant time, the aggregate
of the current assets of the Group
at such time which would fall to be
included as current assets in a
consolidated balance sheet of the
Group drawn up at such time in
accordance with GAAP
CURRENT LIABILITIES at any relevant time, the aggregate
of the current liabilities
(excluding short term debt (which
shall include, for the avoidance of
doubt, any long term debt repayable
within 12 months) and overdrafts) of
the Group at such time which would
fall to be included as current
liabilities in a consolidated
balance sheet of the Group drawn up
at such time in accordance with GAAP
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DEED OF GUARANTOR a deed to be executed and delivered
ACCESSION by any Acceding Guarantor pursuant
to clause 10.17 substantially in the
form of schedule 9 part A
DEFAULT any Event of Default or any event or
circumstance which would, upon the
giving of a notice by the Lender,
the expiry of a period or the
fulfilment of any other condition
(in each case as specified by
reference in clause 16), constitute
an Event of Default
DERIVATIVES CONTRACT a contract, agreement or transaction
which is:
(a) a rate swap, basis swap,
commodity swap, forward
rate transaction, commodity
option, equity (or equity
or other index) swap or
option, bond option,
interest rate option,
foreign exchange
transaction, collar or
floor, currency swap,
currency option or any
other similar transaction;
and/or
(b) any combination of such
transactions,
in each case, whether on-exchange
or otherwise
DOLLARS AND $ the lawful currency for the time
being of the United States of
America
DRAWING each drawing by way of an Advance
DRAWDOWN DATE the date on which a Drawing takes
place
DRAWDOWN NOTICE a notice substantially in the form
of schedule 2, duly completed by the
Borrower
DUTY any duty, obligation or liability of
any kind
ELIGIBLE ACCOUNTS has the meaning given to it in
RECEIVABLE Section 1.1. of the indenture dated
3 December, 1998 in respect of the
November Notes
EMU Economic and Monetary Union as
contemplated in the Treaty
EMU LEGISLATION means legislative measures of the
European Council for the
introduction of, changeover to, or
operation of, a single or unified
European currency
ENCUMBRANCE any mortgage, charge (whether fixed
or floating), pledge, lien,
hypothecation, assignment by way of
security, trust arrangement for the
purpose of
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providing security or other security
interest of any kind securing any
obligation of any person or any
other arrangement having the effect
of conferring rights of retention or
set-off or other disposal rights
over an asset (including without
limitation title transfer and/or
retention arrangements having a
similar effect but excluding
arrangements conferring rights of
retention or set-off in the ordinary
course of business) and includes any
agreement to create any of the
foregoing
ENVIRONMENTAL CLAIM any claim, notice prosecution,
demand, action, official warning,
abatement or other order
(conditional or otherwise) relating
to Environmental Matters or any
notification or order requiring
compliance with the terms of any
Environmental Licence or
Environmental Law
ENVIRONMENTAL LAW all or any law, statute, rule,
regulation, treaty, by-law, code of
practice, order, notice, demand,
decision of the courts or of any
governmental authority or agency or
any other regulatory or other body
in any jurisdiction relating to
Environmental Matters
ENVIRONMENTAL LICENCE any permit, licence, authorisation,
consent or other approval required
at any time by any Environmental Law
ENVIRONMENTAL MATTERS (a) the generation, deposit,
disposal, keeping, treatment,
transportation, transmission,
handling, importation, exportation,
processing, collection, sorting,
presence or manufacture of any waste
or any Relevant Substance; (b)
nuisance, noise, defective premises,
health and safety at work or
elsewhere; and (c) the pollution,
conservation or protection of the
environment (both natural and built)
or of man or any living organisms
supported by the environment or any
other matter whatsoever affecting
the environment or any part of it
EQUIPMENT the goods and services (including
the Reunion Equipment) provided or
to be provided by Nortel Networks to
the Borrower or any other Obligor
pursuant to the Supply Agreement, as
further set out in schedule 2 to the
Supply Agreement
EURIBOR in relation to a particular period:
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(a) the percentage rate per annum
which is sponsored by the
European Banking Federation and
which appears on Telerate page
248 or such other page as may
replace such page 248 on such
system or on any other system
of the information vendor for
the time being designated by
the Federation Bancaire de
l'Union Europeene to be the
official collector, calculator
and distributor of the Euro
Interbank Offered Rate; or
(b) if no such rate is to appear on
the Telerate Screen, the
arithmetic mean (rounded
upward, if necessary, to the
nearest five decimal places) of
the annual rates, as supplied
to the Agent at its request,
quoted by the Reference Banks
to leading banks in the
Interbank Market of any
Participating Member State(s),
at or about 11.00 a.m. Central
European Time on the second Banking
Day before the first day of such
period for the offering of deposits
in euros in an amount approximately
equal to the amount in relation to
which EURIBOR is to be determined
for a period equivalent to such
period
EURO AND EUROS AND / / the single currency of Participating
Member States introduced in
accordance with the provisions of
Article 109(l)4 of the Treaty and in
respect of all payments to be made
under this Agreement in euros means
immediately available, freely
transferable funds
EURO UNIT a currency unit of the euro as
defined in EMU Legislation
EURO ZONE together, the Participating Member
States
EURO ZONE ADDITIONAL COST in respect of the Lenders whose
lending offices are in the Euro
Zone, any cost or loss suffered by
it as a result of complying with the
reserve requirements of the European
Central Bank to the extent such
requirements relate to its
participation in the Facility and
are not recoverable by the Lender
under clause 23
EVENT OF DEFAULT defined (by reference) in clause
16.1
FACILITY the loan facility provided under
this Agreement
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FACILITY PERIOD the period from the date of this
Agreement until the Loan has been
repaid in full together with all
amounts outstanding under this
Agreement and no Finance Party is
under any obligation to make any
other amount available under the
Facility
FINANCE DOCUMENTS this Agreement and the Security
Documents
FINANCE PARTIES the Agent, the Security Agent and
the Lenders and (as the context
requires) FINANCE PARTY means any
one of them
FREE CASH FLOW the aggregate Consolidated EBITDA
for the relevant financial year,
less (i) any interest and other
charges in respect of any Borrowed
Money of the Group, (ii) repayments
and/or prepayments of any Borrowed
Money of the Group other than
pursuant to clauses 6.3(c) and (d),
(iii) capital expenditure of the
Group and (iv) the amount of Taxes
payable by the Group (in each case
as were accrued (for the avoidance
of doubt, excluding deferred taxes)
during such financial year) but
after either (i) adding any amount
by which Net Working Capital at the
commencement of such financial year
exceeds Net Working Capital at the
close of such financial year or, as
appropriate, (ii) deducting any
amount by which Net Working Capital
at the end of such financial year
exceeds Net Working Capital at the
beginning of such financial year
GAAP generally accepted accounting
principles and practices in the
United States of America
GOVERNMENT ENTITY any government or public body,
authority or court
GROUP the Parent, the Borrower and their
respective Subsidiaries
GROUP MEMBER any of the Parent, the Borrower and
their respective Subsidiaries
GUARANTEE the covenants of the Guarantors
contained in clause 10
GUARANTORS the Original Guarantors and the
Acceding Guarantors
GUARANTEED LIABILITIES all moneys, obligations and
liabilities expressed to be
guaranteed by the Guarantors in
clause 10.1
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HOLDING COMPANY in relation to a Lender, the company
or entity within whose consolidated
supervision that Lender is included
or in relation to any other person,
an entity of which that person is a
Subsidiary
INDEBTEDNESS any obligation for the payment or
repayment of money, whether as
principal or as surety and whether
present or future, actual or
contingent
INTELLECTUAL PROPERTY
RIGHTS any patent, trademark, software
licence, service ▇▇▇▇, registered
design, trade name or copyright
required to carry on the business of
any member of the Group
INTEREST PAYMENT DATE the last day of an Interest Period
INTEREST PERIOD each period for the calculation of
interest in respect of each Advance
ascertained in accordance with
clauses 7.4 and 16.16
INCAPACITY in relation to a person, the
insolvency, liquidation dissolution,
winding-up, administration,
receivership or other incapacity of
that person whatsoever (and in the
case of a partnership, includes the
termination or change of composition
of the partnership)
LENDERS the banks and financial institutions
listed in part A of schedule 1 and
includes their successors in title
and Transferees
LICENCES those licences set out in schedule 8
and, if applicable, any other
licences, franchises and permits
issued to any Obligor under or
registrations by any Obligor
required under, any
Telecommunications Laws
LOAN the principal amount advanced to the
Borrower under this Agreement or, as
the context requires, the aggregate
principal amount outstanding under
this Agreement at any time
MAJOR PERMITTED ACQUISITION a Permitted Acquisition (y) where
the aggregate amount of all such
acquisitions and investments in any
financial year is more than or equal
to, or (z) after the additional
amount of $100,000,000 has been
subscribed for in cash for equity
share capital in the Borrower by the
Parent (for the avoidance of doubt,
which amount shall be in addition to
the
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amounts as set out in paragraph (j)
of schedule 3, part A) the value of
any single acquisition or investment
is more than or equal to (i) 10 per
cent. of the Total Relevant Assets
of the Group as a whole as at the
date of the most recent Quarterly
Management Accounts as delivered to
the Agent under this Agreement or
(ii) if at such time Annualised
Consolidated EBITDA (prior to the
proposed acquisition or investment)
(calculated by reference to the
Quarterly Period ending on such
Quarter Days) was not less than zero
on the two most recent previous
consecutive Quarter Days in relation
to which Quarterly Management
Accounts have been delivered to the
Agent under this Agreement, 20 per
cent. of the Total Relevant Assets
of the Group as a whole as at the
date of the most recent Quarterly
Management Accounts as delivered to
the Agent under this Agreement
MAJORITY LENDERS at any relevant time Lenders (a) the
aggregate of whose Contributions
exceed two thirds of the Loan or (b)
(if no principal amounts are
outstanding under this Agreement)
the aggregate of whose Commitments
exceed two thirds of the Total
Commitments but so that if at such
time the Total Commitments have been
reduced to zero references to a
Lender's Commitment shall be
construed (as amongst the Finance
Parties and not so as to give any
rights to any other person) as a
reference to that Lender's
Commitment immediately prior to such
reduction to zero
MANDATORY PREPAYMENT has the meaning given to it in
clause 6.3
MARGIN the rate per annum calculated in
accordance with clause 7.3
MATERIAL ADVERSE EFFECT in the reasonable opinion of the
Agent (acting on the instructions of
the Lenders) a material adverse
effect on
(i) the ability of the Borrower,
the Parent or the Group as a
whole to make payments when due
in respect of any Borrowed
Money; or
(ii) the legal, technical or
financial viability of the
Borrower, the Parent or the
Group as a whole, or the
Project; or
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18
(iii) the ability of any Finance
Party to exercise any of its
respective rights under this
Agreement
MAY NOTES the $225,000,000 13.25 per cent.
Senior Notes due 2008 (and
associated warrants) issued by the
Parent under an indenture between
the Parent as issuer and United
States Trust Company of New York as
trustee, registrar and paying agent,
dated 27 May 1998
NECESSARY AUTHORISATIONS all material approvals,
authorisations and licences (other
than the Licences) from, all rights
granted by and all filings,
registrations and agreements with
any person including, without
limitation, any government or other
regulatory authority necessary in
order to enable each Group Member to
carry on such business as may be
permitted by the terms of this
Agreement and which is carried on at
the relevant time
NET DERIVATIVES LIABILITY in relation to any person, at any
time, the net liability (if any) at
such time of such person in respect
of Derivatives Contracts determined
by reference to the amounts (as
determined by the Agent), which
would be payable or receivable by
such person if all Derivatives
Contracts to which such person was a
party at such time were terminated
at such time and replaced by the
obligation to make a payment
reflecting the economic burden or
value to such person of the payment
flows under those Derivatives
Contracts remaining at the time of
termination
NET WORKING CAPITAL at any time, the aggregate of the
Current Assets of the Group at such
time less the aggregate of the
Current Liabilities of the Group at
such time
NET WORTH the aggregate of:
(a) the amount from time to time
paid up on issued share capital
of the Parent (or, where the
context requires, any person);
(b) the amount from time to time
credited to the Parent (or,
where the context requires, any
person's) share premium
account;
(c) the amount standing to the
credit (or less the amount
standing to the debit) on the
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19
consolidated revenue reserves
of the Group (or where the
context requires, any person)
but excluding (for the
avoidance of doubt) any capital
reserves arising from the
creation of goodwill or the
writing-up of the book value of
assets (other than the writing
up by no more than 25 per cent.
of the historical cost of
assets, provided that such
writing-up is supported by a
certificate from the Group's
Auditors to the effect that
such writing up is justified
and is in accordance with
GAAP); and
(d) the increased amount of
depreciation where additional
depreciation is charged to a
revenue reserve due to the
write up of the value of assets
as contemplated in (c) above,
on a consolidated basis all as shown
in the Quarterly Management Accounts
for each Quarterly Period prepared
in accordance with clause 12.1 or
shown in the Accounts at the end of
any relevant financial year prepared
in accordance with clause 12.1 (as
applicable)
NLG OR GUILDERS the lawful currency for the time
being of The Netherlands
NNIF Nortel Networks International
Finance & Holding B.V. (incorporated
in The Netherlands with number
34054810) and having its registered
office at ▇▇▇▇▇▇▇▇▇▇▇ ▇▇-▇▇, ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
NORTEL NETWORKS Nortel Networks B.V. (incorporated
in The Netherlands with number
34054624) and having its registered
office at Siriusdreef 17-27-2132 WT
Hoofddorp The Netherlands or, as the
case may be, Nortel Networks N.V.
(incorporated in Belgium with number
378.358) and having its registered
office at ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ 1930
NOTES either or both (as the context
requires) of the May Notes and the
November Notes
NOVEMBER NOTES the $150,000,000 13.25 per cent.
Senior Notes due 2008 (and
associated warrants) issued by the
Parent under an indenture between
the Parent as
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20
issuer and United States Trust
Company of New York as trustee,
registrar and paying agent, dated 3
December 1998
OBLIGORS the Borrower and the Guarantors
ORIGINAL GUARANTORS the Parent and those
Subsidiaries of the Borrower whose
names, country of incorporation and
principal place of business are set
out in part B of schedule 1
PARENT VersaTel Telecom International N.V.
(incorporated in The Netherlands
with number 33272606) and having its
statutory seat (statutaire zetel) at
Amsterdam, The Netherlands, and its
registered office at ▇▇▇▇▇▇▇▇▇▇▇ ▇▇,
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ Zuidoost, The
Netherlands
PARENT SUBORDINATED LOAN an agreement evidencing any Borrowed
AGREEMENT Money of the Borrower Group made
available by the Parent which is
subordinated to the rights of the
Finance Parties on terms and
conditions reasonably acceptable to
the Agent and in accordance with the
terms of the Notes
PARTICIPATING MEMBER STATE a member state of the European Union
that adopted a single currency in
accordance with the Treaty
PERMITTED ACQUISITION the acquisition of or investment in
any company, joint venture or
partnership or the acquisition of
any business, in The Netherlands,
Belgium, the United States of
America, the United Kingdom, France
or Germany, where:
(a) such acquisition or investment
is of or in a company, joint
venture, partnership or
business which is involved in a
Permitted Business; and
(b) as a result of such acquisition
or investment the Group does
not have any capital
commitments that are not fully
funded as evidenced by the
Business Plan and the Borrower
will at all times thereafter be
in compliance with the
financial covenants set out in
clause 15,
and the supervisory board or, as the
case may be, board of directors of
the relevant Group
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21
Member making the acquisition or
investment has approved such
acquisition or investment
PERMITTED BUSINESS the business of (i) transmitting, or
providing services relating to the
transmission of, voice, video or
data through owned or leased
transmission facilities, (ii)
constructing, creating, developing
or marketing communications related
network equipment, software and
other devices for use in a
telecommunications business or (iii)
evaluating, participating in or
pursuing any other activity or
opportunity that is primarily
related to those identified in
clause (i) or (ii) above
PERMITTED DISPOSAL (a) transfers, sales or disposals
on bona fide arms' length
commercial terms in the
ordinary course of trade; or
(b) transfers, sales or disposals
of equipment which are either
obsolete or no longer required
in order to enable the Group to
undertake the Permitted
Business
PERMITTED ENCUMBRANCES (a) any Encumbrance arising by
operation of law (not by
contract or otherwise)
including, without limitation,
banker's liens or rights of
set-off and liens arising in
the ordinary course of trading
by operation of law and not by
way of contract so long as any
amounts in respect of which
such liens or rights of set-off
arise are not more than 30 days
overdue for payment;
(b) any Encumbrance arising
hereunder or under any Security
Document;
(c) any liens on any assets of any
member of the Group which
secure Borrowed Money falling
within paragraphs (a), (b), (c)
or (d) of the definition of
"Permitted Senior Debt", but in
each case such Encumbrance must
only be over the equipment
purchased pursuant to such
vendor financing, the property
purchased with such additional
finance, or the eligible
receivables charged in respect
of such Indebtedness, as
referred to in the relevant
paragraph of such definition;
(d) any Encumbrance approved in
writing by the Agent (acting on
the instructions of the
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22
Majority Lenders); or
(e) any Encumbrance arising out of
title retention provisions in a
supplier's standard conditions
of supply of goods or services
acquired in the ordinary course
of the Permitted Business
PERMITTED INDEBTEDNESS (a) Indebtedness permitted under
Section 4.4(b)(xii) of the
indenture in respect of the May
Notes (in their original form);
and/or
(b) acquired Indebtedness permitted
under Section 4.4(b)(ix) of the
indenture in respect of the May
Notes (in their original form)
PERMITTED SENIOR DEBT (a) Indebtedness unsecured or, if
secured, secured solely over
assets purchased with such
finance, as permitted under
Section 4.4(b)(i) of the
indenture in respect of the
November Notes (in their
original form);
(b) any refinancing of any Senior
Debt incurred under paragraph
(a) of this definition,
provided that such refinancing
is on similar terms and
security (if any) given in
respect of such refinancing is
limited as provided in
paragraph (a) above;
(c) Indebtedness under one or more
credit facilities unsecured or,
if secured, secured by a charge
over Eligible Accounts
Receivables subject to an
overall limit not to exceed the
greater of NLG70,000,000 and 80
per cent. of the value of
Eligible Accounts Receivables
outstanding from time to time
or as otherwise agreed with the
Agent acting on the
instructions of the Majority
Lenders;
(d) Indebtedness permitted under
Section 4.4(b)(iv) of the
indenture in respect of the
November Notes (in their
original form);
(e) debt incurred under the Notes
(in their original form) or any
refinancing thereof by the
Parent;
(f) any other Senior Debt incurred
or to be incurred which is
unsecured, contains no right to
call an event of default
without the consent of the
Agent (acting on the
instructions of all the
Lenders) and is fully
subordinated to the
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23
Loan on terms satisfactory to
the Agent; and
(g) any other Indebtedness incurred
or to be incurred by the Parent
which is permitted by the Notes
(in their original form)
PROJECT the construction of the Borrower's
and its Subsidiaries'
telecommunications networks in The
Netherlands and Belgium, or the
United States of America, the United
Kingdom, France and Germany further
to the use of certain international
links into those countries
PROJECT AGREEMENTS the documents and agreements listed
in schedule 7
QUALIFYING PERSON (a) a person, being a bank or
financial institution (whether
incorporated in the United Kingdom
or elsewhere), which is eligible to
have payments made to it by the
Borrower under this Agreement
without any deduction or withholding
in respect of Taxes either (i) by
virtue of a double taxation treaty
or (ii) by virtue of the fact that
no such deduction or withholding is
imposed in the jurisdiction to which
the Borrower is subject, or (b) NNIF
QUARTER DAY 31 March, 30 June, 30 September and
31 December in any year
QUARTERLY MANAGEMENT the quarterly management accounts of
ACCOUNTS the Group to be delivered (or which
may be delivered) to the Agent
pursuant to clause 12.1 in the
agreed form
QUARTERLY PERIOD each period of approximately three
months commencing on the day after a
Quarter Day and ending on the next
following Quarter Day
QUOTATION DATE in relation to any period for which
EURIBOR is to be determined, the
date on which quotations are
customarily provided by leading
banks in the interbank market of any
Participating Member State(s) for
deposits in euro for delivery on the
first day of that period
REFERENCE BANKS the principal London offices of
Paribas, Midland Bank plc and/or any
Lender appointed as such pursuant to
clause 25.14
16
24
REGULATION any present or future law,
regulation, request, requirement or
guideline of any authority, whether
or not it has the force of law (but,
if it does not, with which the
person concerned habitually
complies)
RELEVANT JURISDICTION each jurisdiction in which a member
of the Group is incorporated or
formed or in which such member of
the Group has its principal place of
business or owns any material assets
RELEVANT SUBSTANCE any substance whatsoever (whether in
a solid or liquid form or in the
form of a gas or vapour and whether
alone or in combination with any
other substance) or waste which is
capable of causing harm to man or
any other living organism supported
by the environment, or damaging the
environment or public health or
welfare
REPAYMENT DATES each Quarter Day in each year
commencing 30 June 2001
RESERVATIONS (a) the principle that equitable
remedies (and similar remedies
under the laws of the Relevant
Jurisdictions) are remedies
which may be granted or refused
at the discretion of the court
and damages may be regarded as
an adequate remedy;
the limitation of enforcement
by laws relating to bankruptcy,
insolvency, liquidation,
reorganisation, court schemes,
moratoria, administration and
other laws generally affecting
the rights of creditors;
the time-barring of claims
under any statute of limitation
(and similar legislation);
the possibility that an
undertaking to assume liability
for or to indemnify a person
against non-payment of stamp
duty may be void;
the fact that a court may:
refuse to give effect to a
purported contractual
obligation to pay costs imposed
upon another party in respect
of the costs of any
unsuccessful litigation brought
17
25
against that party or may not
award by way of costs all of
the expenditure incurred by a
successful litigant in
proceedings brought before that
court;
stay proceedings if concurrent
proceedings based on the same
grounds and between the same
parties have previously been
brought before another court;
and
require documents lodged in
proceedings to be translated
into the language of the
jurisdiction of that court;
a judgment in a currency other than
the lawful currency of the
jurisdiction where judgment is
obtained may be converted into the
currency of that jurisdiction for
the purposes of enforcement;
currency indemnity clauses may not
be enforceable; and
defences of set-off and counterclaim
and other similar principles
RESTRICTED PAYMENT in relation to a member of the
Borrower Group
(a) in each case whether by way of
set-off, combination of
accounts or otherwise, (i) any
direct or indirect
distribution, dividend or other
payment (whether in cash or in
specie), including any interest
and/or unpaid dividends, in
respect of its equity or other
share capital for the time
being in issue or (ii) any
payment (whether in cash,
securities, property or
otherwise) of principal of, or
interest on, any Subordinated
Debt, any loan stock or similar
instrument; or
(b) any redemption, reduction or
purchase or otherwise of (i)
its equity or other share
capital or any uncalled or
unpaid liability in respect
thereof, (ii) the amount (if
any) for the time being
standing to the credit of its
share premium account (iii) any
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26
Subordinated Debt, any loan
stock or similar instrument in
whole or in part in any
circumstances or (iv) any other
undistributable reserve in any
manner
in each case to the Parent or a
Restricted Person
RESTRICTED PERSON any shareholder of the Parent, any
Associated Company of such
shareholder or any Holding Company
of such shareholder and any
Subsidiary or Associated Company of
any such Holding Company but shall
not include any Obligor
REUNION EQUIPMENT has the meaning given to it in the
Supply Agreement
RIGHT any right, privilege, power,
immunity or other interest or remedy
of any kind
SECURITY AGENT the Agent in its capacity as
Security Agent for the purposes of
the Security Documents
SECURITY DEED the Security Deed entered into or to
be entered into between the Finance
Parties and the Obligors, and any
party to any Subordinated Loan
Agreement
SENIOR DEBT the principal amount outstanding of
all Borrowed Money incurred by any
member of the Group, excluding any
Indebtedness outstanding in respect
of the Notes or any Subordinated
Debt
SECURITY DOCUMENTS the Asset Charges, the Subordinated
Loan Agreements, the Security Deed
and all Encumbrances, guarantees and
other instruments from time to time
entered into by any person by way of
security or guarantee in respect of
amounts owed to the Finance Parties
under this Agreement (whether or not
also in respect of any other
Indebtedness)
SIX MONTH PERIOD each period of six months ending on
the last day of a calendar month
SUBORDINATED DEBT at any relevant time, the aggregate
of all Borrowed Money lent to the
Borrower Group by the Parent or a
Restricted Person pursuant to a
Subordinated Loan Agreement or a
Parent Subordinated Loan Agreement
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27
SUBORDINATED LOAN an agreement evidencing any Borrowed
AGREEMENT Money of the Group which is
subordinated to the rights of the
Finance Parties on terms and
conditions reasonably acceptable to
the Agent
SUBSCRIBER a person who has entered into an
agreement with a Group Member to be
provided with services by a Group
Member through the operation of the
Group's telecommunication network
SUBSIDIARY of a person means any company or
entity directly or indirectly
controlled by such person, for which
purpose "CONTROL" means either
ownership of more than 50 per cent
of the voting share capital (or
equivalent right of ownership) of
such company or entity or power to
direct its policies and management
whether by contract or otherwise
SUPPLY AGREEMENT the supply contract dated 8 June
1998 and between Nortel Networks and
the Borrower as amended on 28
September 1998 and on 26 April 1999
and as subsequently amended with the
written consent of the Agent (acting
on the instructions of the Majority
Lenders acting reasonably)
SYSTEM in relation to a Group Member, the
telecommunications systems
constructed or to be constructed by
such Group Member pursuant to the
Licences issued to such Group Member
and includes any part of such system
and all modifications,
substitutions, replacements,
renewals and extensions made to such
system
TAXES all present and future taxes,
levies, imposts, duties, fees or
charges of whatever nature together
with any related interest and
penalties (and "TAXATION" is
construed accordingly)
TELECOMMUNICATIONS LAWS all laws, statutes, regulations and
judgments relating to
telecommunications and/or data
services applicable to any Group
Member and/or the business carried
on by any Group Member in any
Relevant Jurisdiction
TOTAL COMMITMENTS at any relevant time, the total of
the Commitments of all the Lenders
at such time
TOTAL DEBT the principal amount of all Borrowed
Money incurred by the Borrower Group
and the Parent
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28
TOTAL DEBT INTEREST CHARGES in relation to any period, the total
amount of all interest, fees
(excluding front-end fees) and
commissions accruing in respect of
Total Debt during such period
TOTAL RELEVANT ASSETS in relation to any period, the
aggregate of the fixed assets
(determined in accordance with GAAP
but for the avoidance of doubt
excluding goodwill) and Current
Assets excluding the writing-up of
the book value of assets (other than
the writing up by no more than 25
per cent. of the historical cost of
assets, provided that any such
writing-up is supported by a
certificate from the Group's
Auditors to the effect that such
writing up is justified and is in
accordance with GAAP) deducting
Current Liabilities, of the Borrower
Group, as at the date of the most
recent Quarterly Management Accounts
delivered to the Agent under this
Agreement
TRANSFEREE has the meaning given to that term
in clause 24.2
TRANSFER CERTIFICATE a certificate substantially in the
terms of schedule 5
TREATY the Treaty establishing the European
Economic Community, being the Treaty
of Rome of 25 March 1957 as amended
by the Single ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ and
the Maastricht Treaty (which was
signed on 7 February 1992 and came
into force on 1 November 1993) as
amended, varied or supplemented from
time to time
TWELVE MONTH PERIOD each period of twelve months ending
on the last day of a calendar month
VERSATEL BELGIUM VersaTel Telecom Belgium N.V.
(incorporated in Belgium with number
Antwerp 328.909) and having its
registered office at ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
YEAR 2000 ISSUE in relation to each Group Member,
the failure of its computer
software, hardware and firmware
systems and equipment containing
embedded computer chips to:
(a) correctly handle date
information before, during and
after 1st January 2000
including, but not limited to,
accepting data input, providing
data output and
21
29
performing calculations on
dates or portions of dates;
(b) function accurately and without
interruption before, during and
after 1st January 2000, without
any change in operations
occasioned by the advent of the
year 2000 and the new century;
(c) respond to two digit year input
and process two digit year date
information, including single
and multi-century formulae and
leap years, in ways that
resolve any ambiguity as to
century in a disclosed, defined
and predetermined manner; and
(d) store and provide out put of
date information, including
single and multi-century
formulae and leap years, in
ways that are similarly
unambiguous as to century.
1.1 INTERPRETATION
In this Agreement:
(a) the table of contents and the headings are inserted for
convenience only and do not affect the interpretation of this
Agreement;
(b) references to clauses and schedules are to clauses of, and
schedules to, this Agreement;
(c) references to this Agreement or any other document are to this
Agreement or that document as from time to time amended,
varied, restated or replaced in accordance with the terms
thereof, or, as the case may be, with the agreement of the
relevant parties and (where in such case the prior consent of
the Agent, the Majority Lenders or the Lenders (as the case
may be) is by the terms of any Finance Document required to be
obtained or the relevant amendment, variation, restatement or
replacement would otherwise result in an Event of Default) the
prior consent of the Agent, the Majority Lenders or the
Lenders (as the case may be);
(d) references to a person includes its successors in title
(unless otherwise stated);
(e) words importing the plural include the singular and vice
versa;
(f) references to a time of day are to London time;
22
30
(g) references to the "agreed form" means, in relation to any
document, the form of such document as shall have been agreed
between the Borrower and the Agent (acting for and on behalf
of all of the Lenders) unless otherwise provided herein; and
(h) references to any enactment include that enactment as
re-enacted; and, if an enactment is amended, any provision of
this Agreement which refers to that enactment will be amended
in such manner as the Agent, after consultation with the
Borrower, shall determine to be reasonably necessary in order
to preserve the intended effect of this Agreement.
1.2 MAJORITY LENDERS
Where this Agreement provides for any matter to be determined by
reference to the opinion of the Majority Lenders or to be subject to
the consent or request of the Majority Lenders or for any action to be
taken on the instructions of the Majority Lenders, once informed by the
Agent that such opinion, consent, request or instructions have been
given, the Borrower shall be entitled (and bound) to assume that such
notice shall have been duly received by each Lender and that the
relevant majority shall have been obtained to constitute Majority
Lenders whether or not this is in fact the case. As between the Lenders
such opinion, consent, request or instructions shall only be regarded
as having been validly given or issued by the Majority Lenders if all
the Lenders shall have received prior notice of the matter on which
such opinion, consent, request or instructions are required to be
obtained and the relevant majority of Lenders shall have given or
issued such opinion, consent, request or instructions.
1.3 AGENT'S OPINION
Where this Agreement provides for the Agent's opinion to determine
whether any matter would or is reasonably likely to have a Material
Adverse Effect and/or a material adverse effect, as the case may be,
the Agent shall act in accordance with the instructions of the Majority
Lenders in making such determination.
2 THE FACILITY
2.1 THE FACILITY
The Lenders will (subject to clause 3) lend up to euro 45,378,022 to
the Borrower. The obligation of each Lender under this Agreement shall
be to contribute that proportion of each Advance which, as at the
Drawdown Date of and Advance, its Commitment bears to the Total
Commitments.
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31
2.2 PURPOSE
The Facility is to be used to finance the purchase of the Equipment in
relation to the Project (excluding any VAT payable by the Borrower in
respect of such purchase).
3 CONDITIONS
3.1 DOCUMENTARY CONDITIONS PRECEDENT
(a) Subject to (b) below, the obligation of each Lender to make
its Commitment available is conditional on prior receipt by
the Agent of, not later than five Banking Days before the day
on which the first Advance is to be made, the documents and
evidence specified in schedule 3 part A in form and substance
reasonably satisfactory to the Agent.
(b) The obligation of each Lender to contribute to an Advance,
which Advance is the first Advance to be used for the purpose
of purchasing the Reunion Equipment, is conditional on prior
receipt by the Agent of, not later than five Banking Days
before the day on which such first Advance is to be made, the
documents and evidence specified in schedule 3, parts A and B
in form and substance reasonably satisfactory to the Agent.
3.2 FURTHER CONDITIONS
The obligation of each Lender to contribute to any Advance is subject
to the further conditions that at the date of each Drawdown Notice and
on each Drawdown Date:
(a) the representations and warranties set out in clause 11
(adjusted in accordance with clause 11.21) are true and
correct on and as of each such date as if each were made with
respect to the facts and circumstances existing at such date;
(b) no Default has occurred and is continuing and no Default will
result from the making of such Advance.
3.3 WAIVER OF CONDITIONS PRECEDENT
The conditions specified in this clause 3 are inserted solely for the
benefit of the Lenders and may be waived on their behalf in whole or in
part and with or without conditions by the Agent acting on the
instructions of all of the Lenders in respect of the first Advance to
the Borrower and on the instructions of the Majority Lenders with
respect to any other Advances without prejudicing the right of the
Agent acting on such instructions to require fulfilment of such
conditions in whole or in part in respect of any other Advance.
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32
3.4 NOTIFICATION
The Agent shall notify the Lenders and the Borrower promptly after
receipt by it of the documents and evidence referred to in clause 3.1
in form and substance reasonably satisfactory to the Agent.
4 THE LOAN
4.1 DRAWDOWN
(a) The Borrower can only draw down the Loan for the purpose set
out in clause 2.2.
(b) If the Borrower wants to draw an Advance, it must deliver a
Drawdown Notice to the Agent by 10:00 a.m. on the third
Banking Day before the intended Drawdown Date. Once given, the
Borrower cannot revoke a Drawdown Notice.
(c) Each Drawdown Notice in respect of an Advance to be drawn down
shall be accompanied by:
(i) a purchase order in respect of the relevant Equipment
to which such Advance relates together with an
invoice from Nortel Networks B.V. in respect of such
Equipment unconditionally evidencing that the amount
to be drawn down is due and payable by the Borrower
to Nortel Networks B.V. pursuant to the Supply
Agreement;
(ii) a supplemental agreement to the relevant Asset Charge
or supplemental list to be attached thereto in form
reasonably satisfactory to the Agent duly executed
and delivered by the Borrower relating, inter alia,
to the relevant Equipment together with a definitive
list of the Equipment to be secured thereto; and
(iii) an acceptance certificate certifying that the
relevant Equipment to which such Advance relates
meets the agreed operational standards.
(d) The Borrower irrevocably authorises the Agent to remit the
proceeds of any Advance requested under this clause 4.1(d) to
Nortel Networks at such bank (whose receipt shall be a good
discharge to the Agent) and such bank account as shall be
notified by Nortel Networks to the Agent. The Borrower
acknowledges that such payment by the Agent shall constitute
the making of such Advance to the Borrower by the Lenders.
4.2 AMOUNT OF ADVANCES
Each Advance will be in euros. After NNIF has transferred all or part
of its Rights and Duties in accordance with clause 24, the principal
amount specified in each Drawdown Notice shall be no less than euro
250,000 or the balance of the
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Commitments. Subject to the terms of this Agreement the Agent will
advance the amount requested in the Drawdown Notice to the Borrower on
the Drawdown Date. The Borrower acknowledges that each such payment by
the Agent shall constitute the making of an Advance to the Borrower by
the Lenders.
4.3 TERMINATION OF COMMITMENTS
Any part of the Commitments of the Lenders undrawn on the last day of
the Availability Period shall be automatically reduced to zero and
cancelled.
4.4 NOTIFICATION TO LENDERS
As soon as practicable after receipt of a Drawdown Notice complying
with the terms of this Agreement the Agent shall notify each Lender
and, subject to clause 3, each of the Lenders shall on the Drawdown
Date make available to the Agent its portion of the relevant Advance in
accordance with clause 2.1 . The amount to be advanced to the Borrower
under this clause 4.4 shall be the amount specified in the relevant
Drawdown Notice.
4.5 APPLICATION OF PROCEEDS
Without prejudice to the Borrower's obligations under clause 13.2, none
of the Finance Parties shall have the responsibility for the
application of the proceeds of any Advance by any Borrower.
5 REPAYMENT
The Borrower will repay the Loan in sixteen equal instalments on
consecutive Quarter Days with the first instalment being due on 30 June
2001 and the last being due on 31 March 2005. The amount of each such
instalment shall be one sixteenth of the Loan as at 30 June 2000. If
any Quarter Day is not a Banking Day the relevant Repayment Date will
be the next Banking Day.
6 PREPAYMENT
6.1 VOLUNTARY PREPAYMENTS
The Borrower may prepay all or part of the Loan in each case on the
following terms:
(a) The amount prepaid must be either the entire Loan or an amount
of at least euro 250,000 and an integral multiple of euro
250,000.
(b) The Borrower must give the Agent at least 30 days' notice of
its intention to prepay. The Borrower cannot revoke such a
notice.
(c) Once the Borrower has given such a notice, the Commitments
will automatically be reduced by the amount of the intended
prepayment.
6.2 ADDITIONAL VOLUNTARY PREPAYMENT
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The Borrower may also prepay (in whole but not in part only), without
premium or penalty, but without prejudice to its obligations under
clauses 22, 18.1 and 23.1, (a) the Contribution of any Lender to which
such Borrower shall have become obliged to pay additional amounts under
clause 18.1 or 23.1 or (b) any Lender's Contribution to which a
Substitute Basis applies by virtue of clause 22. Upon any notice of
such prepayment being given, the Commitment of the relevant Lender
shall be reduced to zero and the amount of the Total Commitments shall
be reduced accordingly.
6.3 MANDATORY PREPAYMENT
(a) The Borrower undertakes to prepay the Loan in full upon either
the occurrence of a Change of Control or the listing of the
Borrower on any recognised stock exchange being suspended for
a continuous period of 14 days or withdrawn.
(b) The Borrower undertakes to apply or procure the application of
the proceeds of:
(i) amounts recovered under any insurance policy in
respect of the Equipment to the extent that (y) the
aggregate of the amounts so recovered exceeds
$250,000, and (z) the proceeds are not used to
purchase further Equipment pursuant to the Supply
Agreement within 60 days of the relevant disposal;
and/or
(ii) all disposals of Equipment supplied pursuant to the
Supply Agreement to the extent that (y) the aggregate
of the purchase price of the Equipment disposed of
exceeds $250,000, and (z) the proceeds are not used
to purchase further Equipment pursuant to the Supply
Agreement within 60 days of the relevant disposal,
in prepayment of the Loan.
(c) To the extent that Free Cash Flow in respect of each financial
year of the Group is in excess of 140 per cent. of the
projected Free Cash Flow for such financial year as set out in
the Business Plan, the Borrower shall apply 50 per cent. of
such excess in prepayment of the Loan.
(d) The Borrower shall procure that 50 per cent. of any Senior
Debt raised by the Borrower Group after the date of this
Agreement (other than Permitted Senior Debt or Permitted
Indebtedness) is applied in prepayment of the Loan.
(e) The Borrower shall prepay the Loan in full upon the early
redemption of the Notes (other than in the circumstances
referred to in clause 6.3(f)).
(f) In the event that the Parent voluntarily redeems up to 35 per
cent. of the November Notes on or before 15 November 2001 as
permitted pursuant to the terms of the November Notes, the
Borrower will repay the same percentage of the Loan
contemporaneously with such redemption,
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provided that if additional equity share capital of more than
$100,000,000 has been subscribed for in cash pursuant to an
initial public offering, no prepayment of the Loan shall be
required,
(g) If, following the drawdown of an Advance in respect of any
amount payable under the Supply Agreement in respect of the
purchase of Equipment following the delivery of the
certificate referred to in clause 4.1(c) signed by a Borrower,
the Borrower rejects and returns such Equipment as a result of
the failure of Nortel Networks to comply with the terms of the
Supply Agreement all or the relevant part of such Advance
shall be repayable on demand. The Borrower irrevocably and
unconditionally instructs Nortel Networks to make payment of
any sum due to it as a result of such failure to the Agent in
or towards satisfaction of the Borrower's obligations under
this clause 6.3 and (subject to receipt of such sum from
Nortel Networks) the Agent agrees to release the Borrower of
its obligation to prepay such sum.
The prepayments set out in this clause 6.3 shall each be referred to as
a "MANDATORY PREPAYMENT".
6.4 APPLICATION OF PREPAYMENTS TO REPAYMENT INSTALMENTS
Any amounts prepaid after 30 June 2000 pursuant to clause 6.2 shall be
applied in reducing the repayment instalments referred to in clause 5
rateably. Any other amounts prepaid after 30 June 2000, shall be
applied against the repayment instalments referred to in clause 5 in
inverse order.
6.5 AMOUNTS PAYABLE ON PREPAYMENT
Any prepayment under this Agreement shall be made together with: (a)
accrued interest to the date of prepayment; (b) any additional amount
payable under clause 18.1, 19.1 or 23.1; and (c) all other sums payable
by the Borrower to the Lenders under this Agreement including, without
limitation, any accrued commitment commission payable under clause 9.2
and any amounts payable under clause 17.
6.6 CANCELLATION
(a) (Other than a payment made pursuant to clause 6.3(g)) on the
date upon which any Mandatory Prepayment is to be applied in
prepayment of the Loan the Total Commitments shall be
automatically reduced by an amount equal to the amount of the
Mandatory Prepayment.
(b) The Borrower may at any time during the Availability Period by
notice to the Agent (effective only on actual receipt) cancel
with effect from a date not less than 7 Banking Days after the
receipt by the Agent of such notice any part (being euro
250,000 or any larger sum which is an integral multiple
thereof) of the undrawn Commitments provided that the Agent
(acting on the instructions of the Majority Lenders) is
reasonably satisfied with the ability of the Borrower to
comply with the Business Plan on an
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ongoing basis and to meet its payment obligations in respect
of its Borrowed Money as they fall due. Any such notice of
cancellation, once given, shall be irrevocable and upon such
cancellation taking effect the Commitment of each Lender shall
be reduced proportionately. No amount cancelled may be
reinstated.
6.7 APPLICATION OF MANDATORY PREPAYMENTS
Each Mandatory Prepayment to be made under clause 6.3 (a), (d), (e) or
(f) shall be made promptly upon the occurrence of the relevant event or
receipt of the relevant amount. Any other Mandatory Prepayment shall be
effected on the Interest Payment Date falling after the date of receipt
of the relevant amount and the Borrower shall deposit the amount of
such Mandatory Prepayment (or if less the amount of the Loan) with the
Agent or as the Agent may reasonably direct in an account (or accounts)
bearing interest at market rates on terms that the principal amount so
deposited may only be released to the Borrower by making the relevant
prepayment, but that any interest on such principal amount is to be
released to the Borrower following such prepayments.
6.8 PREPAYMENTS GENERALLY
The Borrower may not prepay all or any part of the Loan other than as
specified in this clause 6.
7 INTEREST
7.1 DATES OF PAYMENT
The Borrower will pay interest on the Loan in respect of each Interest
Period on its Interest Payment Date.
7.2 RATES OF INTEREST
The rate of interest applicable to an Advance is the aggregate of (a)
the applicable Margin, (b) the Additional Cost and (c) EURIBOR.
7.3 APPLICABLE MARGIN
(a) In respect of each Interest Period or period determined by the
Agent pursuant to clause 8.2, the Margin in relation to the
relevant Advance or unpaid sum under this Agreement under
clause 8 shall be 3.75 per cent. per annum unless at such time
Annualised Consolidated EBITDA (calculated by reference to the
Quarterly Period ending on such Quarter Days) was not less
than zero on the two most recent previous consecutive Quarter
Days in relation to which Quarterly Management Accounts have
been delivered to the Agent under this Agreement, in which
case (b) below will apply.
(b) In respect of each Interest Period or period determined by the
Agent pursuant to clause 8.2 in respect of which (a) above
does not apply, the
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Margin in relation to the relevant Advance or unpaid sum under
this Agreement under clause 8 shall be the rate set out in
column (1) below, which is set out opposite the applicable
ratio of Senior Debt as at the first day of the relevant
Interest Period or period to Annualised Consolidated EBITDA
(calculated by reference to the then most recently ended
Quarterly Period in respect of which Quarterly Management
Accounts have been delivered to the Agent under this
Agreement) set out in column (2) below:
(1) (2)
Rate (per cent. per annum) Ratio of Senior Debt to Annualised
Consolidated EBITDA
3.00 >7.0
2.50 >5.5
2.00 >4.0
1.75 less than or equal to 4.0
(c) If, at the time of determination of the Margin,:
(i) (b) above is applicable; and
(ii) the ratio of Total Debt to Net Worth was greater than
zero and less than 3:1 on the two previous
consecutive Quarter Days calculated by reference to
the Quarterly Period ending on such Quarter Days) as
evidenced by the most recent Quarterly Management
Accounts delivered to the Agent under this Agreement,
the rate set out in column (1) of (b) above shall be reduced
by 0.50 per cent. subject to a minimum of 1.50 per cent. per
annum.
7.4 DETERMINATION OF INTEREST PERIODS
(a) The first Interest Period in respect of each Advance will
start on the relevant Drawdown Date and end on the next
Quarter Day. Each subsequent Interest Period in respect of
each such Advance will start on the day after the last day of
the previous relevant Interest Period and end on the next
Quarter Day. If any Quarter Day is not a Banking Day the
relevant Interest Period will end on the next Banking Day.
(b) If the Borrower has made more than one Drawing under the
Facility then on the last day of the then current Interest
Period for the first Advance, such further Advances shall be
consolidated into a single Advance.
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7.5 NOTIFICATION BY THE AGENT
The Agent will promptly notify each Lender of the duration of each
Interest Period in respect of each Advance and of the rate of interest
applicable to that Interest Period.
8 INTEREST FOR LATE PAYMENT
8.1 THE BORROWER'S OBLIGATION TO PAY
If the Borrower fails to pay an amount payable in connection with the
Finance Documents (including an amount payable under this clause 8) on
the due date for payment, it will pay interest on that amount from the
due date until the date of payment (whether before or after judgment)
in accordance with this clause 8.
8.2 NORMAL RATE
The Agent will divide the period beginning on the due date and ending
on the date of payment into successive periods of such length as it
shall decide in its discretion. The rate of interest applicable to each
such period will be the aggregate of (a) two per cent. per annum, (b)
the applicable Margin, (c) the Additional Cost and (d) EURIBOR.
8.3 INITIAL RATE ON ACCELERATION OF THE LOAN
If, however, the unpaid amount is an amount of principal which is
repayable before its next Interest Payment Date, the first period
selected by the Agent will end on that Interest Payment Date and the
rate of interest applicable to that period will be two per cent. per
annum above the rate previously applicable to that amount.
8.4 DATE OF PAYMENT
Interest is payable under this clause 8 on the last day of each such
period selected by the Agent or, if earlier, the date on which the
Borrower pays an amount in respect of which the interest is accruing.
8.5 NOTIFICATION BY THE AGENT
The Agent will notify the Borrower and the Lenders of the duration of
each such period and of the rate of interest applicable to that period.
9 FEES AND EXPENSES
9.1 FACILITY FEE
The Borrower shall pay the Agent, for the account of the Lenders, a
facility fee of 1.50 per cent. of the Total Commitments. The facility
fee will be payable in two equal instalments, on the date of this
Agreement and 30th June 1999.
9.2 COMMITMENT COMMISSION
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The Borrower shall pay in arrears on each Quarter Date after the date
of this Agreement and on the last day of the Availability Period
(unless the undrawn Commitments have been cancelled in full pursuant to
clause 6.6(b)), for the account of each relevant Lender, commitment
commission computed (i) from the date of this Agreement to (and
including) 30 June 1999 at the rate of 0.50 per cent. per annum, (ii)
from (and including) 1 July 1999 until (and including) 30 September
1999 at the rate of 0.75 per cent. per annum and (iii) from (and
including) 1 October 1999 until the last day of the Availability Period
at the rate of 1.00 per cent. per annum, on the daily undrawn and
uncancelled amount of such relevant Lender's Commitment.
9.3 EXPENSES
The Borrower shall pay, or procure the payment, to the Agent on demand:
(a) all reasonable expenses (including legal, printing and
out-of-pocket expenses) properly incurred by the Agent and the
Security Agent in connection with the negotiation, preparation
and execution of this Agreement and the Security Documents (up
to an amount of $100,000) and of any amendment or extension
of, or the granting of any waiver or consent under, this
Agreement or the Security Documents; and
(b) all expenses (including legal and out-of-pocket expenses)
properly incurred by any Finance Party in contemplation of, or
otherwise in connection with, the enforcement or attempted
enforcement of, or preservation or attempted preservation of
any rights under, this Agreement and/or the Security
Documents, including, without limitation, after the occurrence
of a Default or if otherwise agreed with the Borrower, the
fees and expenses of accountants or other experts incurred in
relation to any investigation into the affairs of any Obligor,
or otherwise in respect of the moneys owing under this
Agreement and/or the Security Documents.
9.4 STAMP AND OTHER DUTIES
The Borrower will promptly pay all stamp duties or similar Taxes and
all filing, registration or notarisation fees payable in connection
with the Facility or the Finance Documents, including those payable by
any of the Finance Parties.
9.5 VAT
All amounts payable under this clause 9 are exclusive of VAT. The
Borrower will, in addition to paying such amounts, pay all applicable
VAT on those amounts.
10 GUARANTEE
10.1 COVENANT TO PAY
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In consideration of the Lenders making or continuing to make Advances
to the Borrower pursuant to this Agreement the Guarantors hereby
irrevocably and unconditionally:
(a) jointly and severally guarantee to each Finance Party, the due
performance by the Borrower of all of its respective
obligations under or pursuant to this Agreement; and
(b) jointly and severally guarantee to each Finance Party the
payment of all moneys now or hereafter due, owing or incurred
by the Borrower under or pursuant to this Agreement when the
same become due whether by acceleration or otherwise.
10.2 GUARANTORS AS PRINCIPAL DEBTORS; INDEMNITY
As a separate and independent stipulation, but subject always to the
provisions of clause 10.1, the Guarantors jointly and severally agree
that if any purported obligation or liability of the Borrower which
would have been the subject of this Guarantee had it been valid and
enforceable is not or ceases to be valid or enforceable against the
Borrower on any ground whatsoever whether or not known to the Finance
Parties or any of them, including, without limitation, any irregular
exercise or absence of any corporate power or lack of authority of, or
breach of duty by, any person purporting to act on behalf of the
Borrower or any legal or other limitation, or any disability or
Incapacity or any change in the constitution of the Borrower) the
Guarantors shall nevertheless be jointly and severally liable in
respect of that purported obligation or liability as if the same were
fully valid and enforceable and such Guarantor was the principal debtor
in respect thereof. The Guarantors hereby irrevocably and
unconditionally jointly and severally agree to indemnify and keep
indemnified the Finance Parties against any loss or liability arising
from any failure of the Borrower to perform or discharge any such
purported obligation or liability or from any invalidity or
unenforceability of any of the same against the Borrower.
10.3 LIMITATION
Notwithstanding the other provisions of this clause 10, the liability
of the Guarantors under this Guarantee is limited as follows:
(a) with respect to a Guarantor incorporated in Belgium, for a
maximum period of 6 years and to a maximum amount of euro
45,378,022;
(b) with respect to a Guarantor incorporated in The Netherlands
(other than the Parent), to the distributable reserves of such
Guarantor at each date on which demand is made under this
Guarantee, for which purpose "DISTRIBUTABLE RESERVES" means
the shareholders' equity of the relevant Guarantor as far as
it exceeds the sum of the amount of the paid and called up
part of the share capital and the reserves of such Guarantor
which must be maintained under the laws of The Netherlands or
the articles of incorporation of such Guarantor.
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10.4 NO SECURITY TAKEN BY GUARANTORS
The Guarantors hereby jointly and severally warrant that they have not
taken or received, and undertake that until all the Guaranteed
Liabilities have been paid or discharged in full, they will not take or
receive, the benefit of any security from the Borrower or any other
person in respect of their obligations under this Guarantee save as may
be agreed by the Majority Lenders.
10.5 INTEREST
Each Guarantor agrees to pay interest on each amount demanded of it
under this Guarantee from the date of such demand until payment (as
well after as before judgment) at the rate specified in clause 8. Such
interest shall be compounded at the end of each period determined for
this purpose by the Agent in the event of it not being paid when
demanded but without prejudice to the Agent and each Lender's right to
require payment of such interest.
10.6 CONTINUING SECURITY AND OTHER MATTERS
This Guarantee shall:
(a) extend to the ultimate balance from time to time owing to the
Finance Parties by the Borrower and shall be a continuing
guarantee, notwithstanding any settlement of account or other
matter whatsoever;
(b) be in addition to any present or future Collateral Instrument,
right or remedy held by or available to the Finance Parties or
any of them; and
(c) not be in any way prejudiced or affected by the existence of
any such Collateral Instrument, rights or remedies or by the
same becoming wholly or in part void, voidable or
unenforceable on any ground whatsoever or by the Finance
Parties or any of them dealing with, exchanging, varying or
failing to perfect or enforce any of the same or giving time
for payment or indulgence or compounding with any other person
liable.
10.7 NEW ACCOUNTS
If this Guarantee ceases to be continuing for any reason whatsoever
each Lender may nevertheless continue any account of the Borrower or
open one or more new accounts and the liability of each Guarantor under
this Guarantee shall not in any manner be reduced or affected by any
subsequent transactions or receipts or payments into or out of any such
account.
10.8 LIABILITY UNCONDITIONAL
The liability of each Guarantor shall not be affected nor shall this
Guarantee be discharged or reduced by reason of:
(a) the Incapacity or any change in the name, style or
constitution of any other Obligor or any other person liable;
or
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(b) any of the Finance Parties granting any time, indulgence or
concession to, or compounding with, discharging, releasing or
varying the liability of any other Obligor or any other person
liable or renewing, determining, varying or increasing any
accommodation, Facilities or transaction or otherwise dealing
with the same in any manner whatsoever or concurring in,
accepting or varying any compromise, arrangement or settlement
or omitting to claim or enforce payment from any other Obligor
or any other person liable; or
(c) any act or omission which would not have discharged or
affected the liability of such Guarantor had it been a
principal debtor instead of a guarantor or by anything done or
omitted which but for this provision might operate to
exonerate such Guarantor.
10.9 COLLATERAL INSTRUMENTS
None of the Finance Parties shall be obliged to make any claim or
demand on the Borrower or to resort to any Collateral Instrument or
other means of payment now or hereafter held by or available to them or
it before enforcing this Guarantee and no action taken or omitted by
any of the Finance Parties in connection with any such Collateral
Instrument or other means of payment shall discharge, reduce, prejudice
or affect the liability of any Guarantor under this Guarantee nor shall
any of the Finance Parties be obliged to apply any money or other
property received or recovered in consequence of any enforcement or
realisation of any such Collateral Instrument or other means of payment
in reduction of the Guaranteed Liabilities.
10.10 WAIVER OF GUARANTORS' RIGHTS
Until all the Guaranteed Liabilities have been paid, discharged or
satisfied in full (and notwithstanding payment of a dividend in any
liquidation or under any compromise or arrangement) each Guarantor
agrees that, without the prior written consent of the Agent, it will
not:
(a) exercise its rights of subrogation, reimbursement and
indemnity against any other Obligor or any other person
liable; or
(b) demand or accept any security to be executed in respect of any
of its obligations under this Guarantee or any other
Indebtedness now or hereafter due to such Guarantor from any
other member of the Group or from any other person liable; or
(c) take any step or enforce any right against any other Obligor
or any other person liable in respect of any Guaranteed
Liabilities; or
(d) exercise any right of set-off or counterclaim against any
other Obligor or any other person liable or claim or prove or
vote as a creditor in competition with any of the Finance
Parties in the liquidation, administration or other insolvency
proceeding of any other Obligor or any other person liable or
have the benefit of, or share in, any payment from
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or composition with, any other Obligor or any other person
liable or any other Collateral Instrument now or hereafter
held by any of the Finance Parties for any Guaranteed
Liabilities or for the obligations or liabilities of any other
person liable but so that, if so directed by the Agent, it
will prove for the whole or any part of its claim in the
liquidation of any other Obligor on terms that the benefit of
such proof and of all money received by it in respect thereof
shall be held on trust for the Finance Parties and applied in
or towards discharge of the Guaranteed Liabilities in such
manner as the Agent shall deem appropriate.
10.11 SUSPENSE ACCOUNTS
Any money received in connection with this Guarantee (whether before or
after any Incapacity of any Obligor) may be placed to the credit of a
suspense account (bearing interest at a commercial rate) with a view to
preserving the rights of the Finance Parties to prove for the whole of
their respective claims against any Obligor or any other person liable
or may be applied in or towards satisfaction of the Guaranteed
Liabilities as the Agent may from time to time conclusively determine
in its absolute discretion.
10.12 SETTLEMENTS CONDITIONAL
Any release, discharge or settlement between any Guarantor and any of
the Finance Parties shall be conditional upon no security, disposition
or payment to any of the Finance Parties by any Obligor or any other
person liable being void, set aside or ordered to be refunded pursuant
to any enactment or law relating to bankruptcy, liquidation,
administration or insolvency or for any other reason whatsoever and if
such condition shall not be fulfilled the Finance Parties shall be
entitled to enforce this Guarantee subsequently as if such release,
discharge or settlement had not occurred and any such payment had not
been made.
10.13 GUARANTORS TO DELIVER UP CERTAIN PROPERTY
If, contrary to clauses 10.4 or 10.10, any Guarantor takes or receives
the benefit of any security or receives or recovers any money or other
property, such security, money or other property shall be held on trust
for the Finance Parties and shall be delivered to the Agent, on demand.
10.14 RETENTION OF THIS GUARANTEE
The Finance Parties shall be entitled to retain this Guarantee after as
well as before the payment or discharge of all the Guaranteed
Liabilities for such period as the Agent may reasonably determine but
for no longer than one year after the payment or discharge of all the
Guaranteed Liabilities.
10.15 CHANGES IN CONSTITUTION OR REORGANISATIONS OF LENDERS
For the avoidance of doubt and without prejudice to the provisions of
clause 25, this Guarantee shall remain binding on each Guarantor
notwithstanding any change in the constitution of the Finance Parties
or any of them or their or its
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absorption in, or amalgamation with, or the acquisition of all or part
of their or its undertaking or assets by, any other person, or any
reconstruction or reorganisation of any kind, to the intent that this
Guarantee shall remain valid and effective in all respects in favour of
any successor in title of the Finance Parties, any Transferee and any
successor Agent appointed pursuant to clause 25.13 or any successor
Security Agent appointed pursuant to the Security Deed in the same
manner as if such successor in title, Transferee or successor Agent or
successor Security Agent had been named in this guarantee as a party
instead of, or in addition to, the relevant Lender, the Agent or the
Security Agent.
10.16 OTHER GUARANTORS
Each Guarantor agrees to be bound by this Guarantee notwithstanding
that any other person intended to execute or to be bound by any other
guarantee or assurance under or pursuant to this Agreement may not do
so or may not be effectually bound and notwithstanding that such other
guarantee or assurance may be determined or be or become invalid or
unenforceable against any other person, whether or not the deficiency
is known to the Lenders or any of them or the Agent, the Security Agent
or the Arrangers or any of them.
10.17 ACCEDING GUARANTORS
(a) To the extent legally possible, the Borrower shall procure
that as soon as reasonably practicable all entities which
become Subsidiaries (other than those which are dormant and do
not hold any licences or other material assets) become
Acceding Guarantors by delivering to the Agent (as soon as is
reasonably practicable following receipt by the Borrower of a
written notice from the Agent requiring such action) Deeds of
Guarantor Accession duly executed by such Subsidiaries and the
Borrower.
(b) To the extent legally possible the Borrower shall procure
that, at the same time as a Deed of Guarantee Accession is
delivered to the Agent, there is delivered to the Agent all
the documents and evidence listed in schedule 9, part B in
respect of the relevant Subsidiary in each case in form and
substance satisfactory to the Agent acting reasonably.
(c) Delivery of a Deed of Guarantor Accession duly executed by an
Acceding Guarantor and the Borrower constitutes confirmation
by the relevant Acceding Guarantor that the representations
and warranties set out in clause 11 to be made by it on the
date of the Deed of Guarantor Accession in accordance with
clause 11.21 are correct as if made by it with reference to
the facts and circumstances then existing.
(d) To the extent legally possible in any Relevant Jurisdiction,
each Acceding Guarantor, before entering into such a Deed of
Guarantor Accession, shall comply with all the relevant
legislation in its country of incorporation to the reasonable
satisfaction of the Agent, to ensure that the proposed
guarantee to be given is in compliance with any relevant
provisions of such legislation and to ensure that the proposed
guarantee
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to be given is, subject to the Reservations, to be legal valid
and binding on the proposed Acceding Guarantor.
(e) Each Finance Party irrevocably authorises the Agent to
countersign each Deed of Guarantor Accession on its behalf
without any further consent of, or consultation with any of
the Finance Parties
(f) Each of the other Obligors irrevocably authorises the Borrower
to countersign each Deed of Guarantor Accession on its behalf
without any further consent of, or consultation with, any of
the other Obligors
11 REPRESENTATIONS
11.1 REPRESENTATIONS
The Parent, in respect of itself and each other Group Member, and each
Obligor in respect of itself only, represents and warrants to each of
the Finance Parties that all the matters described in clauses 11.2 to
11.20 are true and accurate on the date of this Agreement.
11.2 DUE INCORPORATION
It is duly incorporated and validly existing under the laws of its
country of incorporation and has the power, and has obtained all
necessary authorisations, to own its assets and carry on its business
in all relevant jurisdictions.
11.3 THE DOCUMENTS
(a) It has power to execute the Finance Documents to which it is a
party and to exercise its Rights and perform its Duties under
them; and it has obtained all necessary authorisations to do
so.
(b) This Agreement constitutes its legally binding and enforceable
obligations. Each other Finance Document that it is a party
to, when executed, will, subject to the Reservations,
constitute its legally binding and enforceable obligations.
(c) The execution of the Finance Documents and the exercise of its
Rights and the performance of its Duties under them will not
result in it being in breach of any Duty or required to create
any Encumbrance or perform any other action as a result of any
Duty.
(d) The Finance Documents to which it is a party are effective and
admissible in evidence without the need for any filing,
registration, notarisation or other action.
(e) No stamp duty or other Tax is payable in respect of the
Finance Documents to which it is a party.
11.4 LITIGATION
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No litigation, arbitration or administrative proceeding is taking place
or to the best of its knowledge pending against it which, if adversely
determined, would or is reasonably likely to have a Material Adverse
Effect. It is not aware that any such proceeding is threatened.
11.5 THE ACCOUNTS
(a) The Accounts in respect of the financial year ended 31
December 1998 have been prepared in accordance with GAAP which
have been consistently applied. The Accounts provide a true
and fair view of the consolidated financial position of the
Group as at 31 December 1998 and of the consolidated
operations of the Group for the financial period ended on that
date.
(b) There has been no material adverse change in the consolidated
financial position of the Borrower or the Group from that set
out in the Accounts.
11.6 WORKS COUNCILS
If it is incorporated in The Netherlands, it has not instituted a works
council or, if any such works council has been instituted, all action
has been taken by or in relation to such works council necessary to
authorise the performance by it of its respective obligations under the
Finance Documents.
11.7 CHOICE OF LAW
The choice by it of English law to govern this Agreement and the
Security Deed and the submission by it to the non-exclusive
jurisdiction of the High Court of Justice in England are, subject to
the Reservations, valid and binding.
11.8 TITLE TO ASSETS
(With the exception of VersaTel Belgium), it is the legal and
beneficial owner of and has good and marketable title to the Equipment
supplied to it free and clear of any Encumbrance other than Permitted
Encumbrances.
11.9 INTELLECTUAL PROPERTY RIGHTS
(a) The Intellectual Property Rights owned by or licensed to it
are free from any Encumbrance (save for those created or to be
created by or pursuant to the Security Documents and Permitted
Encumbrances) and any other rights or interests in favour of
third parties.
(b) The Intellectual Property Rights owned by or licensed to it
are all the Intellectual Property Rights required by it in
order to carry on, maintain and operate in all material
respects its respective businesses, properties and assets. In
carrying on its business it does not infringe any Intellectual
Property Rights of any third party where any action taken by
such third party in respect of any such infringement would or
is reasonably likely to have a Material Adverse Effect.
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(c) No Intellectual Property Rights owned by it are being
infringed, nor is there, to the best of its knowledge, any
threatened infringement of any such Intellectual Property
Rights which, in either case would or is reasonably likely to
have a Material Adverse Effect.
11.10 PROJECT AGREEMENTS
(a) The Project Agreements which have been entered into on or
prior to the date of this Agreement and to which it is a party
are in full force and effect and, subject to the Reservations,
constitute its legally binding and enforceable obligations.
(b) To the best of its knowledge and belief after due enquiry, (1)
it is not in breach of any material term of any Project
Agreement to which it is a party, (2) there is no material
dispute subsisting between the parties thereto (3) no
termination event (howsoever described) is subsisting
thereunder and (4) no material amendments have been made
thereto.
11.11 LICENCES AND NECESSARY AUTHORISATIONS
The Licences are in full force and effect and it is in compliance in
all material respects with all material provisions thereof that are
applicable to it. It has secured all the Necessary Authorisations, all
such Necessary Authorisations are in full force and effect and it is in
compliance in all material respects with all material provisions
thereof that are applicable to it. To the best of its knowledge and
belief after due enquiry, neither the Licences nor any of the Necessary
Authorisations are the subject of any pending or threatened attack or
revocation.
11.12 NO WITHHOLDING TAXES
No Taxes are imposed by withholding or otherwise on any payment to be
made by it under any Finance Document to any Qualifying Person or are
imposed on or by virtue of the execution or delivery by it of any
Finance Document to which it is a party or any document or instrument
to be executed or delivered under any such Finance Document.
11.13 TELECOMMUNICATIONS LAWS
It is in compliance in all material respects with all
Telecommunications Laws applicable to it.
11.14 ENVIRONMENTAL MATTERS
(a) It is in compliance in all material respects with all
requirements of Environmental Laws applicable to it.
(b) No Environmental Claim is, to its knowledge after due enquiry,
pending, threatened or existing against it.
11.15 INFORMATION
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To the best of its knowledge and belief after due enquiry, as at the
date provided the factual information relating to the Group provided to
any of the Finance Parties was true and accurate in all material
respects and not misleading in any material respect and did not omit
any material facts; all reasonable enquiries have been made by the
Borrower to verify the facts and statements relating to the Group
contained therein.
11.16 NOTES
The execution, delivery and performance of the Finance Documents will
not breach the terms of the Notes and it is not is in breach of any
provision of the Notes.
11.17 YEAR 2000 ISSUE
It has reviewed the effect of the Year 2000 Issue on the computer
software, hardware and firmware systems and equipment containing
embedded microchips owned or operated by or for it or used or relied
upon in the conduct of its business (including systems and equipment
supplied by others or with which its computer systems interface). The
costs to the Group of any reprogramming required as a result of the
Year 2000 Issue to permit the proper functioning of such systems and
equipment and the proper processing of data, and the testing of such
reprogramming, and of the reasonably foreseeable consequences of the
Year 2000 Issue to the Group (including reprogramming errors and the
failure of systems or equipment supplied by others) are not expected to
result in an Event of Default or to have a Material Adverse Effect.
11.18 BOOKS AND RECORDS
All its documentation is maintained in accordance with all material
legal requirements and good business practices and is safely kept and
correct.
11.19 BUSINESS PLAN
All opinions, projections and forecasts contained in the Business Plan
and the assumptions on which such opinions, projections and forecasts
were based were arrived at after due and careful consideration and
enquiry and represent the views of the Borrower as at the date of the
Business Plan; to the best of its knowledge and belief there are no
material facts or circumstances the omission of which could make any of
the opinions, projections and forecasts contained in the Business Plan
(and the assumptions on which such opinions, projections and forecasts
were made) misleading in any respect.
11.20 DEFAULT
No Default has occurred and is continuing.
11.21 REPETITION
The representations and warranties in clauses 11.2 to 11.20 (excluding
clauses 11.3(d) and (e), 11.5(b), 11.12 and 11.15), (so that the
representations and
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warranties in (i) clause 11.5, shall for this purpose refer to the then
and the latest audited consolidated financial statements of the Group
delivered to the Agent under clause 12.1 and (ii) clause 11.19, shall
refer to the then updated Business Plan delivered to the Agent under
clause 12.1) shall be deemed to be repeated by the Obligors on and as
of each Drawdown Date and each Interest Payment Date as if made with
reference to the facts and circumstances existing on each such day.
12 INFORMATION UNDERTAKINGS
12.1 GENERAL
The Borrower will, throughout the Facility Period, provide the Agent
with sufficient copies for all the Lenders of the documents and
information relating to the Group specified in column (1) at the time
specified in column (2):
(1) INFORMATION (2) TIME
The Accounts As soon as they are available, and no
later than 90 days after the end of
the period to which they relate
Quarterly Management Accounts and a As soon as they are available, and no later
Compliance Certificate from an than 45 days after the end of the period to
Authorised Officer which they relate
Quarterly operating and financial As soon as they are available, and no later
performance data on the Project in than 45 days after the end of the period to
the agreed form which they relate
Any document sent to the Parent's or When sent to that person
Borrower's shareholders or creditors
generally
Annual Budget Within 30 days upon it being approved by
the Borrower's supervisory board with such
approval not to be unreasonably withheld or
delayed
Updated Annual Budget or Business 30 days after each amendment or revision is
Plans approved by the supervisory board
of the Borrower
Details of terms of employment of key As soon as reasonably practicable following
members of the Group's management team any material charge
Such other information about the Group As soon as reasonably practicable following
as the Lenders may a request by the Agent
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(1) INFORMATION (2) TIME
reasonably require
Certified English translations of any As soon as reasonably practicable following
Project Agreement a reasonable request by the Agent
Any notice of suspension of, default Within 3 days of receipt by the relevant
under, or amendment to, any Project Obligor
Agreement
12.2 DEFAULTS
Each of the Obligors will procure that the Agent is promptly informed
of (i) any occurrence of which it becomes aware which would or is
reasonably likely to have a Material Adverse Effect and, (ii) any
Default and any potential breach of any of the undertakings set out in
clause 15 promptly upon becoming aware thereof and will from time to
time, if so requested by the Agent, confirm to the Agent in writing
that, save as otherwise stated in such confirmation, no Default has
occurred and is continuing.
13 UNDERTAKINGS
13.1 OBLIGORS' UNDERTAKINGS
Save where stated otherwise, the Parent, in respect of itself and each
other Group Member, and each Obligor in respect of itself only,
undertakes with each of the Finance Parties that it will procure that
the undertakings contained in clauses 13.2 to 13.22 are complied with
throughout the Facility Period.
13.2 PURPOSE
The Borrower will use the Loan for the purpose specified in clause 2.2.
13.3 CONSENTS
It will (and will procure the same in respect of all its Subsidiaries),
without prejudice to clauses 3 and 11, obtain or cause to be obtained,
maintain in full force and effect and comply in all material respects
with conditions and restrictions (if any) imposed in, or in connection
with, every consent, authorisation, licence or approval of any
Government Entity and do, or cause to be done, all other acts and
things, which may from time to time be necessary under applicable law
for the continued due performance of all its material obligations under
the Finance Documents.
13.4 COMPLIANCE WITH LICENCES ETC. RELATING TO THE BUSINESS OF THE GROUP
It will comply, and shall procure that all its Subsidiaries comply, in
all material respects with the terms and conditions of all laws
(including Telecommunications Laws, the Licences and the Necessary
Authorisations), regulations, agreements, licences and concessions
relevant to the carrying on of the business of any member of the Group.
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13.5 PARI PASSU
It will ensure that its obligations, under each of the Finance
Documents shall, without prejudice to the provisions of clause 15, at
all times be direct, general and unconditional obligations and rank at
least pari passu with all its other present and future unsecured and
unsubordinated Indebtedness, subject to the Reservations.
13.6 INSURANCE
It will, and, in the case of the Parent, will procure that each other
Group Member will, (i) insure and keep insured all of the Equipment
with underwriters or insurance companies of repute to such extent and
against such risks (including, without limitation, product liability
risks) as prudent companies engaged in businesses similar to those it
or, in the case of the Parent, the relevant Group Member normally
insures and as further required under the terms of the Security
Documents, (ii) produce (if available) to the Agent on request copies
of all insurance policies from time to time effected by it and, in the
case of the Parent, other Group Members, following their issue and
receipts for the premiums payable under such policies, (iii) procure
that the Security Agent is noted as loss payee on such insurance
policies and (iv) (to the extent permitted by the Notes) assign such
insurance policies to the Security Agent on terms reasonably acceptable
to all of the Lenders.
13.7 ENVIRONMENTAL LICENCES
It will, and will, in the case of the Parent, procure that each Group
Member will, obtain and maintain in full force and effect all
Environmental Licences to ensure that its business complies in all
material respects with all Environmental Laws.
13.8 ENVIRONMENTAL CLAIMS
It will, and will, in the case of the Parent, procure that each Group
Member will, promptly upon receipt of notice of the same inform the
Agent of any Environmental Claim which has been made or to the best of
its knowledge threatened against any Group Member or any of the
officers of any Group Member in their capacity as such which would or
be reasonably likely to have a Material Adverse Effect or any
requirement by any Environmental Licence or applicable Environmental
Laws to make any material investment or expenditure or take or desist
from taking any action.
13.9 RELEVANT SUBSTANCES
It will, and will, in the case of the Parent, procure that each Group
Member will, notify the Agent forthwith upon becoming aware of any
Relevant Substance at or brought on to any of the properties owned,
leased or otherwise occupied by any member of the Group in
circumstances which are outside the ordinary course of the business of
the relevant Group Member which might be reasonably expected to give
rise to any Environmental Claim, and in such cases take or procure the
taking of all necessary action to deal with, remedy or remove from such
property
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or prevent the incursion of (as the case may be) that Relevant
Substance in order to prevent such Environmental Claim and in a manner
that complies with all requirements of Environmental Law.
13.10 YEAR 2000
It will, and will, in the case of the Parent, procure that each Group
Member will, have completed by the commencement of the year 2000, any
reprogramming required to permit the proper functioning, in and
following the year 2000, of (i), in the case of the Parent, the
computer systems of each Group Member and (ii) its equipment containing
embedded microchips (including systems and equipment supplied by
others), in each case which systems or equipment are material to the
carrying on of the Group's business, and the testing of all such
systems and equipment as so reprogrammed.
13.11 INTELLECTUAL PROPERTY RIGHTS
It will, and will, in the case of the Parent, procure that each Group
Member will:
(a) take all action necessary to safeguard and maintain its
rights, present and future, in or relating to all Intellectual
Property Rights material to its business, and in the case of
the Parent, the business of the Group (taken as a whole)
including, without limitation, observing all covenants and
stipulations relating thereto and paying all applicable
renewal fees, licence fees and other outgoings;
(b) use all reasonable efforts to effect registration of
applications for registration of any registered design,
patent, trade ▇▇▇▇ and service ▇▇▇▇ material to its business,
and in the case of the Parent, the business of the Group
(taken as a whole) and keep the Agent informed of events
relevant to any such application and not without the prior
consent in writing of the Agent, acting on the instructions of
the Majority Lenders, permit any Intellectual Property Rights
material to its business, and in the case of the Parent, the
business of the Group (taken as a whole) to be abandoned or
cancelled, to lapse or to be liable to any claim of
abandonment for non-use or otherwise;
(c) promptly notify the Agent of any infringement or suspected
infringement or any challenge to the validity of any of its
present or future Intellectual Property Rights material to its
business, and in the case of the Parent, the business of the
Group (taken as a whole) which may come to its notice, supply
the Agent with all information in its possession relating
thereto and take all steps necessary to prevent or bring to an
end any such infringement and to defend any challenge to the
validity of any such rights; and
(d) not sell, transfer or otherwise dispose of any Intellectual
Property Rights material to its business, and in the case of
the Parent, the business of the Group (taken as a whole).
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13.12 CHANGE IN BASIS OF ACCOUNTS
The Borrower will ensure that all financial statements delivered under
clause 12.1 are prepared in accordance with GAAP and in accordance with
the accounting principles and practices used in the preparation of the
financial statements referred to in part A of schedule 3 (the "ORIGINAL
BASIS") consistently applied in respect of each financial year unless
to do so would be inconsistent with then current GAAP (the "NEW
BASIS"). If the preparation of financial statements on the Original
Basis is contrary to the New Basis then the Borrower shall promptly
notify the Agent in writing of the relevant change and at the option of
the Borrower) shall either (1) prepare and deliver to the Agent audited
financial statements on both the Original Basis and the New Basis or
shall prepare and deliver financial statements on the New Basis only
but shall also prepare and deliver an audited reconciliation statement
(a "RECONCILIATION STATEMENT") showing those adjustments necessary in
order to reconcile the financial statements produced on the New Basis
to the Original Basis) or (2) request the Agent to enter into good
faith negotiations for such amendments (if any) as are necessary to the
covenants contained in clause 15 and any other provisions of this
Agreement affected by such change, in which event the Agent will enter
into such negotiations for a period of not more than 28 days. If
agreement is reached between the Borrower and the Agent (acting on the
instructions of the Majority Lenders) within such period as to the
amendment of any such covenants or provisions, then the parties hereto
will enter into such documentation and take such other steps as are
required to put such amendments into effect following which the
Borrower shall then be obliged to produce financial statements on the
New Basis only. If no such agreement is reached then the Borrower shall
be obliged to prepare and deliver audited financial statements on the
New Basis accompanied by a Reconciliation Statement.
Where the Borrower is under an obligation to deliver financial
statements under clause 12.1 on the New Basis but accompanied by a
Reconciliation Statement, Quarterly Management Accounts shall also be
delivered on the New Basis but accompanied by a Reconciliation
Statement.
All financial statements, Quarterly Management Accounts and
Reconciliation Statements delivered pursuant to this clause 13.12 shall
be delivered within the relevant time period set out in clause 12.1.
The provisions of this clause 13.12 shall also apply, mutatis mutandis,
to the preparation and delivery of the Business Plan under clause 12.1.
13.13 FINANCIAL YEAR END
Unless the Agent is otherwise advised, it will and, in the case of the
Parent, will procure that each Group Member will maintain a financial
year end of 31 December, in the event that such a change is made the
covenants in clause 15 will be restated as at the new financial year
end.
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13.14 AUTHORISED OFFICERS
It will ensure that any new or replacement Authorised Officer has
provided the Agent with evidence reasonably satisfactory to it of such
new officer(s)' authority and a specimen of his or their signature(s)
prior to signing any Compliance Certificates, Drawdown Notices, or any
other notices, requests or confirmations referred to in this Agreement
or relating to the Facilities.
13.15 AUDITORS
The Parent will ensure that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ is appointed as auditor of
the Parent, the Borrower and each of its Subsidiaries and not change
such appointment without appointing a major accounting firm of
recognised international standing and repute.
13.16 INSPECTION
It will if required by the Agent (acting on the instructions of the
Majority Lenders), at any time whilst a Default is continuing, permit,
to the extent it is able to do so, representatives of the Agent or any
of the Lenders upon reasonable prior written notice to the Borrower or
its relevant Subsidiary, after having made arrangements with the
Borrower so to do and after entering into a confidentiality undertaking
if reasonably required by the Borrower (a) visit and inspect the
properties of any Group Member during normal business hours, (b)
inspect and make extracts from and copies of its books and records
other than records which the relevant Group Member is prohibited by law
or any confidentiality undertaking from disclosing to the Agent and/or
any relevant Lender and (c) discuss with its principal officers and
auditors its business, assets, liabilities, financial position, results
of operations and business prospects provided that any such discussion
with the auditors shall only be on the basis of the audited accounts of
the Group and Compliance Certificates issued by the auditors.
13.17 TAXES
It will and will procure that each Group Member will file or cause to
be filed all tax returns required to be filed in all jurisdictions in
which it is situated or carries on business or is otherwise subject to
Taxation and will pay all Taxes shown to be due and payable on such
returns or any assessments made against it within the period stipulated
for such payment (other than those being contested in good faith and
where such payment may be lawfully withheld).
13.18 SUBORDINATION OF LOANS FROM SUBORDINATED CREDITOR
The Parent will procure that any Subordinated Debt is made available on
terms and conditions reasonably acceptable to the Agent.
13.19 BUSINESS PLAN
The Parent will, and will procure that each Group Member will, perform
at all times in accordance with the Business Plan.
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13.20 WORKING CAPITAL
The Borrower will maintain adequate working capital to enable it to
comply with the Business Plan and ensure that the days of receivables
outstanding on a rolling average basis is less than 90 days.
13.21 BUSINESS
The Parent will engage solely in the business of acting as the Holding
Company of its Subsidiaries (which shall include the on-lending of
Borrowed Money to its Subsidiaries in accordance with the provisions of
this Agreement) and will not act as an operating company actually
engaged in any business.
13.22 MAINTENANCE OF SYSTEMS AND SOFTWARE
The Borrower will procure that the Systems are maintained in accordance
with industry standard practice and that the software used in
connection with the Equipment is maintained within two releases
generally available to users operating a similar business to the
Borrower.
13.23 PERMITTED ACQUISITIONS
(a) The Borrower shall, within 7 days of the completion of a
Permitted Acquisition or a Major Permitted Acquisition, give
notice thereof to the Agent, together with confirmation that
immediately after such completion no Default has occurred and
is continuing or, to the best of its knowledge, would result
therefrom.
(b) The Borrower shall, within 7 days of the approval by the
supervisory board or, as the case may be the board of
directors, of a Major Permitted Acquisition, give notice
thereof to the Agent, together with a certificate in the
agreed form signed by the chief financial officer of the
Borrower confirming his opinion that the Borrower will at all
times after the completion of such Major Permitted Acquisition
be in compliance with all the covenants set out in clause 15.
Thereafter the Borrower shall provide the Agent with such
information as it may reasonably request about the strategic
rationale and economics of such acquisition.
(c) (i) In respect of a Permitted Acquisition which is not a Major
Permitted Acquisition, the Borrower shall provide the Agent
with a revised Business Plan within 60 days of the date of
such Permitted Acquisition. There shall be no requirement for
such Business Plan to have been approved by the Supervisory
Board of the Borrower.
(ii) In respect of a Major Permitted Acquisition, the Borrower
shall provide the Agent with a revised Business Plan, approved
by the Supervisory Board of the Borrower, within 60 days of
the date of such Major Permitted Acquisition.
In either case such Business Plan shall demonstrate that all
capital
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commitments relating to the relevant Permitted Acquisition or
Major Permitted Acquisition are fully funded and that the
Borrower will at all times be in compliance with the financial
covenants set out in clause 15.
(d) Where a Permitted Acquisition or a Major Permitted Acquisition
is made by a Group Member during a Quarterly Period, the
Consolidated EBITDA attributable to the acquisition or
investment for that part of the relevant Quarterly Period
prior to the acquisition may (at the option of the Borrower)
also be included for the purposes of determining Consolidated
EBITDA of the Group. If the Consolidated EBITDA attributable
to the acquisition or investment is negative, it must be
included.
If the Consolidated EBITDA attributable to an acquisition is
to be included the Borrower shall determine the Consolidated
EBITDA attributable to any such acquisition or investment by
reference to the accounts used for the purpose of the
acquisition or investment (which may be yearly, half-yearly,
management or completion accounts or other accounts). The
Borrower shall make available to any Lender, if it so requests
(through the Agent), a copy of such accounts. If the
Consolidated EBITDA attributable to an acquisition or
investment is not included, the Borrower will confirm to the
Agent whether the Consolidated EBITDA attributable to that
acquisition or investment was positive or negative.
14 NEGATIVE UNDERTAKINGS
14.1 OBLIGORS' UNDERTAKINGS
The Parent, in respect of itself and the other Group Members, and each
Obligor in respect of itself only, undertakes with each of the Finance
Parties that it will procure that the undertakings contained in clauses
14.2 to 14.13 are complied with throughout the Facility Period.
14.2 NEGATIVE PLEDGE
No Encumbrance will exist over the Equipment except Permitted
Encumbrances.
14.3 SENIOR DEBT AND GUARANTEES
It will not incur or permit to be outstanding:
(a) any Borrowed Money of any member of the Group (other than
Borrowed Money outstanding under this Agreement, Permitted
Senior Debt or Permitted Indebtedness) or guarantee any such
Borrowed Money provided however, that if no Default or Event
of Default shall have occurred and be continuing at any time,
or would occur as a consequence of the incurrence of any such
Borrowed Money, it may incur Borrowed Money if immediately
thereafter the ratio of Total Debt (including the relevant
Borrowed Money) to Annualised Consolidated EBITDA
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calculated by reference to the two most recent Quarterly
Periods (in respect of which Quarterly Management Accounts
have been delivered to the Agent under this Agreement)
adjusted as if such Borrowed Money had been incurred and the
proceeds thereof had been applied at the beginning of such two
Quarterly Periods, would be greater than zero and less than or
equal to 5.0:1;
(b) any Borrowed Money from a Restricted Person other than
Subordinated Debt;
(c) (in respect of the Borrower Group only) any Borrowed Money
from the Parent other than pursuant to a Parent Subordinated
Loan Agreement; or
(d) any other Borrowed Money unless otherwise permitted pursuant
to the terms of this Agreement.
14.4 DISPOSALS
There will be no disposal of a material part of the assets of any
member of the Group other than a Permitted Disposal.
14.5 LOANS AND GUARANTEES
Save for normal trade credit given in the ordinary course of trading,
it (the "LENDING OBLIGOR") will not make any loans to, grant any credit
to or give any guarantee to or for the benefit of, or enter into any
transaction having the effect of lending money to any person who is not
an Obligor other than a Group Member who is not an Obligor (a
"BORROWING GROUP MEMBER") and provided that the aggregate amount of all
such Indebtedness does not exceed euro 20,000,000 and the right of the
relevant Lending Obligor to receive any payment in respect thereof is
not subordinated and ranks at least pari passu with all unsecured and
unsubordinated claims against the Borrowing Group Member.
14.6 EQUITY YIELD
It will not make any Restricted Payment to the Parent, any of its
shareholders or any Restricted Person if any amount has not been paid
in accordance with this Agreement, or any covenant in clause 15 has
been breached and not remedied or waived.
14.7 SHAREHOLDERS' MEETINGS
It will not alter or convene any meeting with a view to the alteration
of any provision of its respective Memorandum or Articles of
Association if such alteration would or would be likely to have (in the
reasonable opinion of the Agent) a Material Adverse Effect, and unless
the Agent is provided with a reasonable opportunity to review and
prevent such an alteration prior to it being made.
14.8 NEW SHARE ISSUES
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It will not, and will procure that none of its Subsidiaries will
(without the prior written consent of the Agent, acting on the
instructions of the Majority Lenders), issue any shares (other than to
an Obligor) or otherwise acquire any additional capital (other than
from an Obligor) unless such shares or capital will not entitle the
holder or owner thereof to receive any interest, dividend, other
distribution, capital or any other amount until after the Facility
Period provided that the Parent shall be entitled to issue ordinary
shares fully paid (i) pursuant to an initial or any future public
offering of fully paid ordinary shares of the Parent; (ii) pursuant to
a private equity placement; (iii) pursuant to the exercise of any share
options or warrants existing at the date hereof or subsequently issued
subject always to clause 6.3(a), or (iv) in consideration for the
purchase price in relation to a Permitted Acquisition or a Major
Permitted Acquisition, and in each of the cases set out in (i) to (iv)
above, no other provision of any Finance Document would be breached as
a result.
14.9 AMALGAMATION AND MERGER
It will not merge or consolidate with any other company or person and,
in the case of the Parent, it will procure that no other Group Member
merges or consolidates with any other company or person save for
mergers between any Group Members with any or all of the other Group
Members or, as the case may be, any other company or person (in which
case, for the avoidance of doubt, such merger or amalgamation shall
comply in all respects with clause 13.23) ("ORIGINAL ENTITIES") into
one or more entities (each a "MERGED ENTITY") provided that:
(i) reasonable details of the proposed merger in order to
demonstrate satisfaction with paragraphs (ii) to (iv) below,
including a formal legal opinion in form satisfactory to the
Agent which confirms paragraph (ii) below, are provided to the
Agent at least 10 days before the merger or amalgamation is to
be entered into;
(ii) such Merged Entity is a Group Member and is liable for the
obligations of the relevant Original Entities (including the
obligations under this Agreement and the other Finance
Documents) which remain unaffected thereby and entitled to the
benefit of all the rights of such Original Entities;
(iii) if the Agent reasonably determines necessary, such Merged
Entity has entered into a Deed of Guarantor Accession and/or
Security Documents which provide a guarantee and/or security
over the same assets of at least an equivalent nature and
ranking to the security provided by the relevant Original
Entities pursuant to any Guarantee or Security Documents
entered into by them and the Lenders consent to such
arrangements (such consent not to be unreasonably withheld);
(iv) substantially all the property and other assets of the
relevant Original Entities are vested in the Merged Entity and
that the Merged Entity has assumed all the rights and
obligations of the relevant Original Entities under the
Finance Documents and Project Agreements and all material
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Necessary Authorisations;
14.10 CHANGE IN BUSINESS
It will not, and will procure that none of its Subsidiaries will,
engage in any line of business other than Permitted Business in the
Benelux region, or in the United States of America, France, Germany or
the United Kingdom further to the use of certain international links
into those countries directly or indirectly from the System.
14.11 ACQUISITIONS AND JOINT-VENTURES
The Parent will not, and will procure that no Group Member will,
acquire or make any investment in any companies, joint ventures or
partnerships or acquire any businesses (or interests therein) other
than Permitted Acquisitions or Major Permitted Acquisitions.
14.12 SWAPS AND HEDGING
It will not and will, in the case of the Parent, procure that no Group
Member enters into any interest rate or currency swaps or other hedging
arrangements other than non-speculative arrangements directly relating
to the risk management of Borrowed Money permitted to subsist by the
terms of this Agreement and entered into in the ordinary course of the
business for the genuine hedging of the relevant underlying
transaction.
15 OPERATIONAL AND FINANCIAL COVENANTS
15.1 OPERATIONAL AND FINANCIAL COVENANTS
Each Obligor undertakes with each of the Finance Parties that it will
ensure that on each Quarter Date falling within the Facility Period the
undertakings contained in clauses 15.2 and 15.3 are complied with.
15.2 OPERATIONAL COVENANTS
(a) Minimum average revenue
At all times during the periods set out in column (1) below the average
revenues per month received by the Group from Subscribers (excluding
for these purposes any Subscribers in respect of any Permitted
Acquisition which are not categorised as Business Subscribers) arising
out of the use or operation of the System (calculated on each Quarter
Day by reference to the Six Month Period ending on such day) must be
not less than the amount set out against such period in column (2)
below per such Subscriber per month:
(1) (2)
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Period NLG
------ ---
1 January - 30 June 1999 529
1 April - 30 September 1999 559
1 July - 31 December 1999 616
1 October 1999 - 31 March 2000 691
1 January - 30 June 2000 766
1 April - 30 September 2000 827
1 July - 31 December 2000 877
1 October 2000 - 31 March 2001 900
1 January - 30 June 2001 925
1 April - 30 September 2001 963
1 July - 31 December 2001 1000
1 October 2001 - 31 March 2002 1038
1 January - 30 June 2002 1075
1 April - 30 September 2002 1120
1 July - 31 December 2002 1155
1 October 2002 - 31 March 2003 1188
1 January - 30 June 2003 1223
1 April - 30 September 2003 1258
1 July - 31 December 2003 1293
1 October 2003 - 31 March 2004 1328
1 January - 30 June 2004 1363
1 April - 30 September 2004 1398
1 July - 31 December 2004 1433
1 October 2004 - 31 March 2005 1468
(b) Total revenue
This covenant shall only apply until Annualised Consolidated EBITDA
(calculated by reference to the Quarterly Period ending on such Quarter
Days) was not less than zero on two most recent previous consecutive
Quarter Days in relation to which Quarterly Management Accounts have
been delivered to the Agent under this Agreement.
(i) Until and including the Quarterly Period ending on 30 September
2001:
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subject to the foregoing, at all times during the periods set out in
column (1) below the total revenues (calculated on each Quarter Day by
reference to the Twelve Month Period ending on such day),
(x) within any three consecutive periods set out in column (1)
must be equal to or exceed the amount set out against the
relevant period in column (3) below in respect of at least two
out of the three relevant periods; and
(y) must be not less than the amount set out against such period
in column (2) below:
(1) (2) (3)
Period NLG ('000) NLG ('000)
------ ---------- ----------
1 July 1998 - 30 June 1999 51,663 55,552
1 October 1998 - 30 September 1999 58,494 62,897
1 January - 31 December 1999 63,683 68,476
1 April 1999 - 31 March 2000 76,930 82,720
1 July 1999 - 30 June 2000 104,560 112,430
1 October 1999 - 30 September 2000 149,006 155,215
1 January - 31 December 2000 205,653 214,222
1 April 2000 - 31 March 2001 260,294 271,140
1 July 2000 - 30 June 2001 311,552 324,533
and
(ii) For the Quarterly Period commencing on 1 October 2001 and
thereafter:
subject to the foregoing, at all times during the periods set out in
column (1) below the total revenues (calculated on each Quarter Day by
reference to the Six Month Period ending on such day) must be not less
than the amount set out against such period in column (2) below:
(1) (2)
Period NLG ('000)
------ ----------
1 October 2001 - 31 March 2002 228,877
1 January - 30 June 2002 244,305
1 April - 30 September 2002 256,626
1 July - 31 December 2002 278,425
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1 October 2002 - 31 March 2003 294,853
1 January - 30 June 2003 312,646
1 April - 30 September 2003 324,268
1 July - 31 December 2003 350,673
1 October 2003 - 31 March 2004 363,160
1 January - 30 June 2004 383,913
1 April - 30 September 2004 405,586
1 July - 31 December 2004 428,216
1 October 2004 - 31 March 2005 451,840
15.3 POST ANNUALISED CONSOLIDATED EBITDA POSITION
If Annualised Consolidated EBITDA (calculated by reference to the
Quarterly Period ending on such Quarter Days) was not less than zero on
two consecutive Quarter Days in respect of which Quarterly Management
Accounts have been delivered to the Agent under this Agreement:
(a) Maximum Senior Debt to Annualised Consolidated EBITDA
the ratio of Senior Debt of the Borrower Group and the Parent
to Annualised Consolidated EBITDA of the Borrower Group and
the Parent (calculated by reference to the Quarterly Period
ending on such Quarter Day) shall not exceed the number set
out in column (2) below against the period set out in column
(1) below in which such Quarterly Period falls:
(1) (2)
Period Ratio
------ -----
1 January - 31 March 2002 11.00:1
1 April - 30 June 2002 7.50:1
1 July - 30 September 2002 5.25:1
1 October - 31 December 2002 3.75:1
1 January - 31 March 2003 3.25:1
1 April - 30 June 2003 3.00:1
1 July - 30 September 2003 2.75:1
1 October - 31 December 2004 2.60:1
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1 January - 31 March 2004 2.25:1
1 April - 30 June 2004 2.00:1
1 July - 30 September 2004 2.00:1
1 October - 31 December 2004 2.00:1
1 January - 31 March 2005 2.00:1
and
(b) Debt Service Cover
in respect of the Borrower Group and the Parent the ratio of
Consolidated EBITDA for the Six Month Period ending on such
Quarter Day to Total Debt Interest Charges during such Six
Month Period shall not be less than the number set out in
column (2) below against the period in column (1) below in
which such Quarterly Period falls:
(1) (2)
Period Ratio
------ -----
1 October 2001 - 31 March 2002 0.25:1
1 January - 30 June 2002 0.45:1
1 April - 30 September 2002 0.65:1
1 July - 31 December 2002 0.90:1
1 October 2002 - 31 March 2003 1.07:1
1 January - 30 June 2003 1.15:1
1 April - 30 September 2003 1.20:1
1 July - 31 December 2003 1.25:1
1 October 2003 - 31 March 2004 1.40:1
1 January - 30 June 2004 1.70:1
1 April - 30 September 2004 2.00:1
1 July - 31 December 2004 2.25:1
1 October 2004 - 31 March 2005 2.50:1
15.4 AUDITORS CERTIFICATE
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If at any time the Majority Lenders (acting reasonably and following
consultation with the Borrower) do not consider that any figure set out
in any Compliance Certificate issued by any Authorised Officer is
correct, they shall be entitled within 30 days of the date of the
delivery of such Compliance Certificate to the Agent pursuant to clause
12.1 to call for a certificate from the Borrower's auditors as to such
figure. For such purposes the Borrower's auditors shall act as
independent experts and not as arbiters and every such certificate
shall be addressed to the Agent (on behalf of the Lenders) and be at
the expense of the Borrower. If the Majority Lenders call for such a
certificate all calculations under this Agreement by reference to the
relevant figure shall (i) until the Borrower's auditors deliver the
relevant certificate under this clause 15.4 be made by reference to the
figure set out in the relevant Compliance Certificate delivered to the
Agent under this Agreement and (ii) following the delivery by the
Borrower's auditors of a certificate under this clause 15.4 be made by
reference to such certificate and the Borrower undertakes forthwith to
pay all additional amounts which would have been payable under clause
6.2 by reference to such Compliance Certificate.
16 DEFAULT
16.1 EVENTS OF DEFAULT
Each of the matters listed in clauses 16.2 to 16.15 is an Event of
Default.
16.2 THE FINANCE DOCUMENTS
(a) The Borrower fails to pay any amount payable under clause 5
when due except where the failure is due solely to technical
or administrative delays in the transmission of funds outside
the control of the Borrower.
(b) Any Obligor fails to pay any other amount payable by it under
the Finance Documents in the manner stipulated in them and
such failure is not cured within 5 Banking Days of receiving
notice from the Agent of such failure to pay except where the
failure is due solely to technical or administrative delays in
the transmission of funds outside the control of the relevant
Obligor. The period of 5 Banking Days referred to in this
clause 16.2(b) shall not apply at a time when an Event of
Default has occurred and is continuing and if any Obligor
agrees to a shorter period in equivalent provision in any
other agreement relating to Borrowed Money to which it is a
party then such shorter period will apply to this clause
16.2(b) mutatis mutandis.
(c) Any representation or warranty made by an Obligor in
connection with the Finance Documents, a Drawdown Notice or
any related document is incorrect or misleading in a material
respect and, in the event that the act or circumstance which
led to such representation or warranty being incorrect or
misleading is capable of remedy, such action as the Agent may
require shall not have been taken within 30 days of the Agent
notifying the relevant Obligor of such act or circumstance and
such required action.
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(d) Any Obligor breaches any other provision of the Finance
Documents and, in respect of any such breach which is capable
of remedy, such action as the Agent may reasonably require
shall not have been taken within 30 days of the Agent
notifying the relevant Obligor of such default and of such
required action.
(e) Any material provision of the Finance Documents becomes
unlawful, ineffective or unenforceable for any reason
whatsoever.
16.3 CROSS-DEFAULT
(a) Any Borrowed Money of any Obligor is not paid when due or
within any applicable grace period expressly contained in the
agreement relating to such Borrowed Money, or any Borrowed
Money of any Group Member becomes (whether by declaration or
automatically in accordance with the relevant agreement or
instrument constituting the same) due and payable prior to the
date when it would otherwise have become due or any creditor
of any Group Member becomes entitled to declare any Borrowed
Money of any Group Member so due and payable or to require
cash collaterisation or security for any such borrowed Money
or any facility or commitment available to any Group Member
relating to Borrowed Money is withdrawn, suspended or
cancelled by reason of any default (however described) of the
company concerned and the amount, or aggregate amount at any
one time, of all Borrowed Money in relation to which any of
the foregoing events shall have occurred and be continuing is
equal to or greater than $250,000 or its equivalent in the
currency in which the same is denominated and payable or such
other (a) lower amount as agreed to by any Obligor with any
debt provider, or (b) higher amount as agreed to by any
Obligor with any provider of Senior Debt of $100,000,000 or
more; or
(b) Any Group Member fails to make payment in relation to a
Derivatives Contract of any sum equal to or greater than
$250,000 (or its equivalent) in aggregate at any one time (or
its equivalent in the relevant currency of payment) on its due
date or the counterparty to a Derivatives Contract becomes
entitled to terminate that Derivatives Contract early and the
Net Derivatives Liability of the Group Members, in the
aggregate, under all its Derivatives Contracts in relation to
which any of the foregoing events shall have occurred at the
relevant time is equal to or greater than $250,000 (or its
equivalent in the relevant currency) or such other (a) lower
amount as agreed to by any Obligor with any debt provider, or
(b) higher amount as agreed to by any Obligor with any
provider of Senior Debt of $100,000,000 or more.
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16.4 FINANCIAL POSITION
(a) Any Obligor or Group Member becomes insolvent or unable to pay
its debts when due or within any applicable grace period
expressly contained in the agreement relating to such debt.
(b) Any Obligor ceases to carry on business, stops payment of its
debts or any class of them or enters into any compromise or
arrangement in respect of its debts or any class of them; or
any step is taken to do any of those things.
(c) The auditors of the Group qualify their audit report on the
audited consolidated financial statements of the Group except
where the qualification is of a technical nature and the
remedy for the matter giving rise to the qualification would
have no effect on the results of the Group for the period to
which such accounts relate or on the financial position of the
Group as at the end of such period.
(d) A material part of the assets of the Group taken as a whole is
nationalised, expropriated or compulsorily acquired.
16.5 INSOLVENCY PROCEDURES
(a) Any Obligor is dissolved or enters into liquidation,
administration, administrative receivership, receivership, a
voluntary arrangement, a scheme of arrangement with creditors,
any analogous or similar procedure in any jurisdiction other
than England or any other form of procedure relating to
insolvency, reorganisation or dissolution in any jurisdiction;
or a petition is presented or other step is taken by any
person with a view to any of those things.
(b) However, there will not be an Event of Default under clause
16.5(a) in respect of any Obligor (other than the Borrower) if
the Borrower can establish, to the reasonable satisfaction of
the Agent (acting on the instructions of the Majority
Lenders), that such procedure is:
(i) instituted by the Obligor concerned for the purpose
of a fully solvent reorganisation; or
(ii) a court process instituted by a creditor and is an
abuse of process of the court
provided that, in either case, the obligations of the relevant
Obligor under, and the security created by, the Finance
Documents to which such Obligor is a party will not be
materially adversely affected.
16.6 LEGAL PROCESS
(a) Any judgment or order against an Obligor in respect of
indebtedness exceeding $50,000 or its equivalent, or any other
Group Member in
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respect of indebtedness exceeding $250,000 or its equivalent,
is not stayed or complied with within fourteen days.
(b) Any execution, distress, sequestration or other legal process
which is not frivolous or vexatious is commenced against any
of the assets of an Obligor in respect of indebtedness
exceeding $50,000 or its equivalent, or any other Group Member
in respect of indebtedness exceeding $250,000 or its
equivalent, and is not discharged within fourteen days.
(c) Any formal steps are taken to enforce an Encumbrance over any
assets of an Obligor in respect of indebtedness exceeding
$50,000 or its equivalent, or any other Group Member in
respect of indebtedness exceeding $250,000 or its equivalent.
16.7 COMPOSITIONS
Any formal steps are taken, or negotiations commenced, by an Obligor or
any Group Member or by any of their respective creditors with a view to
proposing any kind of composition, compromise or arrangement involving
such company and any of its creditors other than for the purpose of a
fully solvent reorganisation of the Group.
16.8 LITIGATION
Any litigation, alternative dispute resolution, arbitration or
administrative proceeding is taking place, pending or to the best of
its knowledge threatened against or affecting any Obligor or Group
Member, which if determined against it, would be reasonably likely, in
the opinion of the Agent, to have a Material Adverse Effect.
16.9 MATERIAL ADVERSE CHANGE
An event or series of events occurs or circumstances arise which, in
the opinion of the Agent, would or is reasonably likely to have a
Material Adverse Effect.
16.10 ABANDONMENT OF THE PROJECT
All or a material part of the development or operation of the Project
is abandoned or suspended for a continuous period exceeding 30 days.
16.11 PROJECT AGREEMENTS
(a) Any Project Agreement is terminated, suspended, revoked or
cancelled or otherwise ceases to be in full force and effect
(unless services of a similar nature to those provided
pursuant to such Project Agreement (if still required to
enable the Group to complete the Project or carry on the
Permitted Business) are at all times provided to the Group on
terms no less beneficial to the relevant member of the Group).
(b) Any amendment, alteration or variation is made to any term of
any Project Agreement or any Project Agreement is restated or
replaced by
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any successor agreement which (in the reasonable opinion of
the Agent) would or is reasonably likely to have a Material
Adverse Effect.
(c) Any party breaches any term of or repudiates any of its
obligations under any of the Project Agreements where such
breach or repudiation (in the opinion of the Agent) would or
is reasonably likely to have a Material Adverse Effect.
16.12 ENVIRONMENTAL MATTERS
As a result of any Environmental Law, any Finance Party becomes subject
to a material, in the reasonable opinion of the Agent, obligation
(actual or contingent, in the case of any contingent obligation, being
one which, at the relevant time, would be likely to arise) as a result
of it entering into or performing its obligations under any of the
Finance Documents.
16.13 TELECOMMUNICATIONS LAWS
Any Obligor or Group Member fails to comply in any material respect
with any material term or condition of any Telecommunications Law.
16.14 LICENCES
Any Licence is terminated, suspended, revoked or cancelled or otherwise
ceases to be in full force and effect unless a replacement licence on
terms no less beneficial to the relevant member of the Group becomes
effective no later than the time of such termination, suspension,
revocation, cancellation or cessation to be in full force and effect.
16.15 RESTRICTED PERSONS
(a) Any Restricted Person breaches any provision under a
Subordinated Loan Agreement and, in respect of any such breach
which is capable of remedy, such action as the Agent may
reasonably require shall not have been taken within 21 days of
the Agent notifying the relevant Restricted Person of such
default and of such required action.
(b) Any representation or warranty made by or in respect of any
Restricted Person in or pursuant to any Subordinated Loan
Agreement is incorrect or misleading in any material respect
and, in the event that the act or circumstance which led to
such representation or warranty being incorrect or misleading
is capable of remedy, such action as the Agent may require
shall not have been taken within 21 days of the Agent
notifying such Restricted Person of such act or circumstance
and such required action.
(c) Any material provision of any Subordinated Loan Agreement
becomes unlawful, ineffective or unenforceable for any reason
whatsoever.
(d) Any Restricted Person is dissolved or enters into liquidation,
administration, administrative receivership, receivership, a
voluntary arrangement, a scheme of arrangement with creditors,
any analogous or
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similar procedure in any jurisdiction other than England or
any other form of procedure relating to insolvency,
reorganisation or dissolution in any jurisdiction; or a
petition is presented or other step is taken by any person
with a view to any of those things.
However, there will not be an Event of Default under this
clause 16.15(d) in respect of any Restricted Person if the
Borrower can establish, to the reasonable satisfaction of the
Agent (acting on the instructions of the Majority Lenders),
that such procedure is:
(i) instituted by the Restricted Person concerned for the
purpose of a fully solvent reorganisation; or
(ii) a court process instituted by a creditor and is an
abuse of process of the court
provided that, in either case, the obligations of the relevant
Restricted Person under, and the subordination created by, the
relevant Subordinated Loan Agreement will not be adversely
materially affected.
16.16 CONSEQUENCES OF EVENT OF DEFAULT
If an Event of Default has occurred and is continuing, the Agent if so
requested by the Majority Lenders may at any time after the happening
of an Event of Default (and while the same is continuing), by giving
notice to the Borrower:
(a) terminate the Facility (thereby reducing the Total Commitments
to zero); and/or
(b) demand repayment of all or any part of the Loan and payment of
any other amounts accrued under this Agreement; and/or
(c) declare that all or any part of the Loan is repayable, and any
other amounts accrued under this Agreement are payable, on
demand by the Agent at any time (in which event future
Interest Periods will be selected by the Agent); and/or
(d) declare that the Security Documents (or any of them) have
become enforceable whereupon the same shall be enforceable.
17 PAYMENTS
17.1 PAYMENTS BY THE OBLIGORS
Each payment to be made by an Obligor under the Finance Documents will
be made to the Agent as follows:
(a) it will be paid on the due date. If that date is not a Banking
Day, it will be paid on the next Banking Day. However, if that
would take the payment into the next calendar month, it will
be paid on the preceding Banking Day.
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(b) It will be paid in full, without any set-off or deduction and
in accordance with clause 18.
(c) The Loan will be repaid, and interest and other amounts
attributable to the Loan including fees will be paid, in
euros. Costs and expenses will be paid in the currency in
which they were incurred.
17.2 PAYMENTS IN THE WRONG CURRENCY
If a payment is received from any of the Obligors in the wrong
currency, it will not discharge any part of the obligation in respect
of which it was made. The Agent is irrevocably authorised to convert
the amount received into the correct currency and to apply the net
proceeds in reduction of the relevant Obligor's liability. However, the
Agent is under no obligation to do so, either at all or at any
particular time, and has no responsibility for any loss suffered by any
Obligor as a result of the Agent's action or inaction save in the case
of negligence or wilful misconduct on the part of the Agent.
17.3 PARTIAL PAYMENTS
If a payment received from any Obligor under the Finance Documents is
insufficient to pay in full all amounts then payable by the relevant
Obligor under the Finance Documents, the amount received will be
applied in or towards payment of the following in the following order:
(a) first, in or towards payment, on a pro-rata basis, of any
unpaid costs and expenses of the Agent and/or the Security
Agent under the Finance Documents;
(b) secondly, in or towards payment to the Finance Parties, on a
pro-rata basis, of any amount owing to the Finance Parties
under clause 25.12;
(c) thirdly, in or towards payment to the Finance Parties, on a
pro-rata basis, of any accrued commitment commission payable
under clause 9.2 which shall have become due but remains
unpaid;
(d) fourthly, in or towards payment to the Finance Parties, on a
pro-rata basis, of any accrued interest which shall have
become due but remains unpaid but so that any amount payable
by virtue of clause 18.1 shall be excluded;
(e) fifthly, in or towards payment to the Finance Parties, on a
pro-rata basis, of any principal which shall have become due
but remains unpaid;
(f) sixthly, in or towards payment to any relevant Finance
Parties, on a pro-rata basis, of any amount payable to any
such Finance Parties by virtue of clause 18.1 which remains
unpaid; and
(g) seventhly, in or towards payment of any other sum which shall
have become due but remains unpaid (and, if more than one such
sum so remains unpaid, on a pro-rata basis).
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Each reference in clauses 17.3(a) to (c) (inclusive) to a category of
unpaid sums shall include interest thereon payable in accordance with
this Agreement including, without limitation, default interest under
clause 8.
The order of application set out in this clauses 17.3(d) to 17.3(g)
shall be varied by the Agent if the Majority Lenders so direct, without
any reference to, or consent or approval from, the Obligors.
This clause overrides any appropriation of such a payment by an
Obligor.
17.4 PRO-RATA PAYMENTS
(a) If at any time any Finance Party (the "RECOVERING BANK")
receives or recovers any amount owing to it by any Obligor
under the Finance Documents by direct payment, set-off or in
any manner other than by payment through the Agent pursuant to
clause 17.1 or 17.3 (not being a payment received from a
sub-participant in such Lender's Contribution to the Facility
or any other payment of an amount due to the Recovering Bank
for its sole account pursuant to clauses 6.3, 18.1, 19.1,
22.1, 23.1 or 23.5), the Recovering Bank shall, within two
Banking Days of such receipt or recovery (a "RELEVANT
RECEIPT") notify the Agent of the amount of the Relevant
Receipt. If the Relevant Receipt exceeds the amount which the
Recovering Bank would have received if the Relevant Receipt
had been received by the Agent and distributed pursuant to
clause 17.1 or 17.3, as the case may be, then:
(i) within two Banking Days of demand by the Agent, the
Recovering Bank shall pay to the Agent an amount
equal (or equivalent) to the excess;
(ii) the Agent shall treat the excess amount so paid by
the Recovering Bank as if it were a payment made by
the Borrower and shall distribute the same to the
Finance Parties (other than the Recovering Bank) in
accordance with clause 17.3; and
(iii) as between the relevant Obligor and the Recovering
Bank the excess amount so re-distributed shall be
treated as not having been paid but the obligations
of the relevant Obligor to the other Finance Parties
shall, to the extent of the amount so re-distributed
to them, be treated as discharged.
(b) If any part of the Relevant Receipt subsequently has to be
wholly or partly refunded by the Recovering Bank (whether to a
liquidator or otherwise) each Finance Party to which any part
of such Relevant Receipt was so re-distributed shall on
request from the Recovering Bank repay to the Recovering Bank
such Finance Party's pro-rata share of the amount which has to
be refunded by the Recovering Bank.
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(c) Each Finance Party shall on request supply to the Agent such
information as the Agent may from time to time request for the
purpose of this clause 17.4.
(d) Notwithstanding the foregoing provisions of this clause 17.4
no Recovering Bank shall be obliged to share any Relevant
Receipt which it receives or recovers pursuant to legal
proceedings taken by it to recover any sums owing to it under
the Finance Documents with any other party which has a legal
right to, but does not, either join in such proceedings or
commence and diligently pursue separate proceedings to enforce
its rights in the same or another court (unless the
proceedings instituted by the Recovering Bank are instituted
by it in breach of clause 26.4).
17.5 NO RELEASE
For the avoidance of doubt it is hereby declared that failure by any
Recovering Bank to comply with the provisions of clause 17.4 shall not
release any other Recovering Bank from any of its obligations or
liabilities under clause 17.4.
17.6 NO CHARGE
The provisions of this clause 17 shall not, and shall not be construed
so as to, constitute a charge by a Finance Party over all or any part
of a sum received or recovered by it in the circumstances mentioned in
clause 17.4.
17.7 RECONVENTIONING
After consultation between the Agent, the Borrower and the Lenders and
notwithstanding clause 25.11 the Agent (acting reasonably) shall be
entitled to make such amendments to the provisions of this Agreement as
it may determine to be necessary to conform them to market practices
(whether as to the settlement or rounding of obligations, the
calculation of interest or otherwise howsoever) then applicable to
instruments denominated in euro.
Any amendment so made to this Agreement by the Agent shall be promptly
notified to the other Finance Parties and the Obligors by the Agent and
shall be binding on all the Finance Parties and the Obligors.
18 TAXES
18.1 GROSSING-UP
If any Obligor is required to make a withholding in respect of Taxes
from any payment for the account of any Finance Party under the Finance
Documents (or if the Agent is required to make any such withholding
from a payment to another Finance Party), the amount payable by such
Obligor will be increased to the extent necessary to ensure that, after
such withholding has been made, the Finance Party receives (and is able
to retain) a net sum equal to the amount which it would have received
if no such withholding had been required to be made.
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18.2 QUALIFYING PERSON
The relevant Obligor will not have to pay any increased amount under
clause 18.1 if the relevant Finance Party is not a Qualifying Person if
and to the extent that it exceeds the amount which it would have had to
pay if the relevant Finance Party had been a Qualifying Person.
18.3 CLAW-BACK OF TAX BENEFIT
This clause 18.3 applies if any Finance Party has received an increased
payment from any Obligor under clause 18.1 and subsequently receives a
credit against, or remission for, Taxes payable by it. Such Finance
Party will, in its discretion, establish the amount (if any) which, as
a result of such receipt, it is able to repay to the relevant Obligor
without putting itself in a worse position than if no withholding had
been required; and will pay it to the relevant Obligor as soon as
reasonably practicable. The Finance Party shall not have any obligation
to rearrange its tax affairs or disclose any information about them. At
the date of this Agreement each Lender represents that it is a
Qualifying Person.
19 INDEMNITY
19.1 GENERAL INDEMNITIES
(a) The Borrower will, on demand, indemnify each Finance Party
against any loss which it may suffer as a result of:
(i) any failure by any Obligor to pay any amount under
the Finance Documents when it is due or within any
applicable grace period;
(ii) any prepayment of all or part of the Loan otherwise
than on an Interest Payment Date and in accordance
with clause 6;
(iii) any Advance not being made for any reason (other than
a default by a Finance Party) after a Drawdown Notice
has been given;
(iv) the occurrence of any Event of Default;
(v) any payment made by any Lender to the Agent pursuant
to clause 25.12; or
(vi) any other breach of the Finance Documents by an
Obligor; or
(vii) the application of any Euro Zone Additional Cost.
(b) In this clause 19.1, "LOSS" means a loss or expense of any
kind certified as such by the relevant Finance Party,
including losses arising as a result of funding the Loan or
re-employing deposits which are no longer required to do so
but excluding loss of Margin.
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19.2 ENVIRONMENTAL INDEMNITY
The Borrower agrees to indemnify on demand each Finance Party, and
their respective officers, employees, agents and delegates (together
the "INDEMNIFIED PARTIES") in respect of which each Finance Party,
holds this indemnity on trust, without prejudice to any of their other
rights under this Agreement or any other Finance Document, against any
loss, liability, action, claim, demand, cost, expense, fine or other
outgoing whatsoever whether in contract, tort, delict or otherwise and
whether arising at common law, in equity or by statute which the
relevant Indemnified Party shall certify as sustained or incurred by it
at any time as a consequence of, or relating to, or arising directly or
indirectly out of, any Environmental Claims made or asserted against
such Indemnified Party which would not have arisen if this Agreement or
any other Finance Document had not been executed and which was not
caused by the negligence or wilful default of the relevant Indemnified
Party provided that the relevant Indemnified Party notifies the
Borrower promptly on being notified of such Environmental Claim.
20 SET-OFF
20.1 SET-OFF
Each Finance Party may whilst a Default subsists set off any credit
balance to which any Obligor is entitled or any other Indebtedness of
such Finance Party to such Obligor against any sum then payable by such
Obligor to such Finance Party under the Documents.
20.2 PURCHASE OF CURRENCIES
Each Obligor irrevocably authorises each Finance Party to purchase such
other currencies as may be reasonably necessary to effect the set-off.
20.3 NOTIFICATION
Each Finance Party will notify the Agent of any exercise of this power
of set-off and the Agent shall inform the other Finance Parties and the
relevant Obligor.
21 CALCULATIONS AND CERTIFICATES
21.1 CALCULATIONS
All interest, commission and other payments of an annual nature under
the Finance Documents will accrue from day to day. They will be
calculated on the basis of actual days elapsed and a 360 day year.
21.2 CERTIFICATES
Any certificate or determination by a Finance Party as to any rate of
interest, exchange rate, or amount payable under the Finance Documents
is conclusive and binding on the Obligors, unless there is a manifest
error, and (in the case of a certificate of or determination by the
Agent) on the other Finance Parties.
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22 MARKET DISRUPTION
22.1 PROBLEMS WITH EURIBOR; UNAVAILABILITY OF FUNDS
(a) This clause 22.1 applies if, at any time before the start of
an Interest Period or any other period for which EURIBOR needs
to be established:
(i) the Agent determines, in its reasonable discretion,
that adequate and fair means do not exist for
ascertaining the rate at which banks are offered
funds in the interbank market of the relevant
Participating Member States during that period or
that EURIBOR for that period will not accurately
reflect the cost of funding the Loan for that period;
or
(ii) the Agent shall have received notification from
Lenders with Contributions aggregating not less than
50 per cent. of the Loan or Commitments aggregating
not less than 50 per cent. of the Total Commitments
that deposits in euros are not available to such
Lenders in the interbank market of the relevant
Participating Member States in the ordinary course of
business in sufficient amounts to fund their
Contributions for such Interest Period or that
EURIBOR does not accurately reflect the cost to such
Lenders of obtaining such deposits,
the Agent shall forthwith give notice (a "DETERMINATION
NOTICE") to the Borrower and to each of the Lenders. A
Determination Notice shall contain reasonable particulars of
the relevant circumstances giving rise to its issue. After the
giving of any Determination Notice the undrawn amount of the
Total Commitments shall not be borrowed until notice to the
contrary is given to the Borrower by the Agent (the giving of
such notice not to be unreasonably withheld or delayed).
(b) During the period of 10 days after the Determination Notice
has been given by the Agent under clause 22.1(a) the relevant
Lender shall (having consulted in good faith with the Borrower
certify a reasonable alternative basis the "SUBSTITUTE BASIS")
for making available or, as the case may be, maintaining its
Contribution. The Substitute Basis may (without limitation)
include alternative interest periods, alternative currencies
or alternative rates of interest but shall include a margin
above the cost of funds (including Additional Cost, if any) to
such Lender equivalent to the applicable Margin. Each
Substitute Basis so certified shall be binding upon the
Borrower and shall take effect in accordance with its terms
upon the Borrower from the date specified in the Determination
Notice until such time as the Agent notifies the Borrower that
none of the circumstances specified in clause 22.1 continues
to exist whereupon the normal interest rate fixing provisions
of this Agreement shall apply (the giving of such notice not
to be unreasonably withheld or delayed).
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23 CHANGES IN REGULATION
23.1 CIRCUMSTANCES WHEN THIS CLAUSE APPLIES
This clause 23 applies if a new Regulation is introduced or there is a
change to an existing Regulation or to its interpretation and, in any
such case, its effect is, in relation to the Facility or the Finance
Documents:
(a) to reduce the amount payable to any Finance Party;
(b) to subject any Finance Party or its Holding Company to any
additional or increased Taxation or other cost;
(c) to cause any Finance Party or its Holding Company to incur any
loss (including a loss of potential future profits) or to make
any payment; or
(d) to reduce in any other way the effective return of any Finance
Party or its Holding Company.
23.2 OBLIGATION TO COMPENSATE THE LENDER
In the circumstances described in clause 23.1, such Finance Party will
notify the Borrower through the Agent as soon as practicable. The
Borrower will, on demand, pay to the Agent for the account of such
Finance Party the amount which such Finance Party certifies is required
to compensate it or its Holding Company for the matters specified in
clause 23.1. Such a demand may be made even after such Finance Party
has been repaid. The certificate must set out the basis of the
computation of the amount and the paragraph of clause 23.1 to which
such claim relates, but need not include any matters which such Finance
Party or its Holding Company regards as confidential.
23.3 EXCEPTIONS
No Finance Party will be entitled to receive any compensation under
clause 23.2 to the extent that the amount otherwise payable under that
clause:
(a) has been taken into account in calculating the Additional Cost
or is the subject of additional payment under clause 18.1; or
(b) arises as a consequence of (or of any Regulation
implementing):
(i) the proposals for international convergence of
capital measurement and capital standards published
by the Basle Committee on Banking Regulations and
Supervisory Practices in July 1988; or
(ii) the Own Funds Directive (89/299/EEC of 17th April
1989) or the Solvency Ratio Directive (89/647/EEC of
18th December 1989),
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in each case, unless it results from any change in, or in the
interpretation or application of, any of the same occurring
after the date of this Agreement; or
(c) arises as a consequence of any change in the Taxation of its
overall net income, profits or gains imposed in the
jurisdiction in which its lending office under this Agreement
is located; or
(d) if it ceases to be a Qualifying Person.
23.4 MITIGATION
Without being under any legal obligation to do so, or to provide any
information to the Borrower, a Finance Party will use reasonable
endeavours to mitigate any loss which would give rise to a claim under
clauses 18.1, 22 or 23 as may be open to it, including, without
limitation, relocating its lending office, or transferring its rights,
benefits and obligations under this Agreement to a Transferee
acceptable to the Borrower and willing to participate in the Facility
unless, to do so might (in the reasonable opinion of such Lender) be
prejudicial to such Lender or be in conflict with such Lender's general
banking policies or involve such Lender in expense or increased
administrative burden.
23.5 ILLEGALITY
If it becomes contrary to any Regulation for a Lender to perform any of
its Duties under this Agreement, such Lender's Commitment will
forthwith be reduced to zero and the Borrower will repay the
Contribution of such Lender either forthwith, if such unlawfulness has
immediate or retrospective effect, or on a future specified date not
being later than the latest date permitted by such Regulation, on
demand by such Lender, together with all other amounts owing to such
Lender under the Finance Documents.
24 TRANSFER
24.1 NO TRANSFERS BY THE OBLIGORS
None of the Obligors may transfer any of its Rights or Duties under the
Finance Documents.
24.2 TRANSFERS BY THE LENDER: TRANSFER AGREEMENTS
Each Lender (a "TRANSFEROR LENDER") may (subject to clause 24.8)
transfer, all or any part of its Rights and Duties under the Finance
Documents to NTFC Capital Corporation, Export Development Corporation
of Canada or to another financial institution with reasonable
experience of lending to the emerging broadband telecommunications
services sector with a credit rating of at least Baa2 with ▇▇▇▇▇'▇
Investors Services Inc. (a "TRANSFEREE") after consultation with the
Borrower but without the consent of any party. Any such transfer shall
be effected upon not less than 5 Banking Days' prior notice by delivery
to the Agent of a duly completed Transfer Certificate duly executed by
the Transferor
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Lender and the Transferee. On the Effective Date (as specified and
defined in a Transfer Certificate so executed and delivered), to the
extent that the Commitment and Contribution of the Transferor Lender
are expressed in a Transfer Certificate to be the subject of the
transfer in favour of the Transferee effected pursuant to this clause
24.2, by virtue of the counter-signature of the Transfer Certificate by
the Agent (for itself and the other parties to this Agreement):
(a) to the extent that in such Transfer Certificate the Transferor
Lender seeks to transfer such obligations and rights hereunder
the existing parties to this Agreement and the Security Deed
and the Transferor Lender shall be released from their
respective obligations towards one another, other than the
obligations outstanding from the Obligors to the Transferor
Lender under this Agreement and the Security Deed ("DISCHARGED
OBLIGATIONS") and their respective rights against one another,
other than the rights outstanding from the Obligors under this
Agreement and the Security Deed ("DISCHARGED RIGHTS") shall be
cancelled and the rights of the Transferor Lender against the
Borrower shall be assigned to the Transferee party pursuant to
the relevant Transfer Certificate the ("ASSIGNED RIGHTS");
(b) the Transferee party to the relevant Transfer Certificate and
the existing parties to this Agreement and the Security Deed
(other than such Transferor Lender) shall assume obligations
towards each other which differ from the discharged
obligations only insofar as they are owed to or assumed by
such Transferee instead of to or by such Transferor Lender as
a result of such transfer; and
(c) the Transferee party to the relevant Transfer Certificate and
the existing parties to this Agreement and the Security Deed
(other than such Transferor Lender) shall acquire rights
against each other which differ from the discharged rights and
the assigned rights only insofar as they are exercisable by or
against such Transferee instead of by or against such
Transferor Lender as a result of such transfer;
and, on such Effective Date, the Transferee shall (unless the Agent
waives such fee) pay to the Agent for its own account a fee of pound
sterling 1,000. The Agent shall promptly notify the other Lenders and
the Borrower of the receipt by it of any Transfer Certificate and shall
promptly deliver a copy of such Transfer Certificate to the Borrower.
24.3 RELIANCE ON TRANSFER CERTIFICATE
The Agent, the Security Agent and the Obligors shall be fully entitled
to rely on any Transfer Certificate delivered to the Agent in
accordance with the foregoing provisions of this clause 24 which is
complete and regular on its face as regards its contents and
purportedly signed on behalf of the relevant Transferor Lender and the
Transferee and none of the Security Agent, the Agent or the Obligors
shall have any liability or responsibility to any party as a
consequence of placing
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reliance on and acting in accordance with any such Transfer Certificate
if it proves to be the case that the same was not authentic or duly
authorised.
24.4 AUTHORISATION OF AGENT
Each party to this Agreement irrevocably authorises the Agent to
counter-sign each Transfer Certificate on its behalf for the purposes
of clause 24.2 without any further consent of, or consultation with,
such party.
24.5 CONSTRUCTION OF CERTAIN REFERENCES
If any Lender transfers all or any part of its rights, benefits and
obligations as provided in clause 24.2 all relevant references in this
Agreement to such Lender shall thereafter be construed as a reference
to such Lender and/or its Transferee to the extent of their respective
interests.
24.6 LENDING OFFICES
Each Lender shall lend through its office at the address specified in
schedule 1 or, as the case may be, in any relevant Transfer Certificate
or through any other office of such Lender selected from time to time
by such Lender through which such Lender wishes to lend for the
purposes of this Agreement. If the office through which a Lender is
lending is changed pursuant to this clause 24.6, such Lender shall
notify the Agent promptly of such change.
24.7 DISCLOSURE OF INFORMATION
Save as permitted pursuant to the terms of the Finance Documents any
information furnished pursuant to any Finance Document to the Finance
Parties shall be kept confidential by the recipient, save that the same
may be disclosed to the recipient's legal advisers, auditors, accounts
and other professional advisers reasonably requiring it and the
provisions of this clause 24.7 shall not apply:
(a) to any information already known to the recipient otherwise
than as a result of a breach of a duty of confidentiality to
any person;
(b) to any information subsequently received by the recipient
otherwise than as a result of a breach of a duty of
confidentiality to any person which it would otherwise be free
to disclose;
(c) to any information which is or becomes public knowledge
otherwise than as a result of a breach by any person of this
clause 24.7 or of any confidentiality undertaking entered into
pursuant to clause 24.8;
(d) to any extent that the recipient is required to disclose the
same pursuant to any law or order of any court or order or
request of any governmental agency with whose instructions the
recipient habitually complies provided that the Parent is
given notice thereof.
24.8 CONFIDENTIALITY UNDERTAKING
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Any Finance Party may disclose to a prospective Transferee or to any
other person who may propose entering into contractual relations with
such Finance Party in relation to any Finance Document any information
referred to in clause 24.7 subject to the prospective Transferee or
other person first entering into a confidentiality undertaking with the
Borrower in substantially the same terms as clause 24.7 and this clause
24.8.
24.9 LIMITATION ON CERTAIN OBLIGATIONS
If, at the time any transfer or change in lending office by any Lender
becomes effective, circumstances exist which would oblige any Obligor
to pay to the Transferee (or, in the case of change in lending office,
the relevant Lender) under clauses 18.1 or 23 any sum in excess of the
sum (if any) which it could have been obliged to pay to the Lender
under the relevant clause in the absence of that transfer or change of
lending office, such Obligor shall not be obliged to pay that excess.
24.10 RESTRICTIONS ON TRANSFERS
(a) Any transfer by a Lender may only be made under this clause 24
in respect of a Commitment and/or Contribution of euro
5,000,000 or more.
(b) Where a Lender transfers part of its rights, benefits and
obligations pursuant to clause 24.2, that Lender must transfer
equal fractions of its Commitment and Contribution.
(c) The Transfer Certificate relating to any such transfer shall
be completed accordingly.
24.11 SUB-PARTICIPATION
Subject to clause 24.8, a Lender may enter into sub-participation
arrangements in relation to all or any of its Rights and Duties under
this Agreement with any person without restriction and without the
consent of any other party to this Agreement provided that such Lender,
other than in matters requiring the consent of all of the Lenders,
retains the right to vote as a Lender.
25 AGENT, SECURITY AGENT AND REFERENCE BANKS
25.1 APPOINTMENT OF AGENT
Each Lender irrevocably appoints the Agent as its agent for the
purposes of this Agreement and irrevocably authorises the Agent
(whether or not by or through employees or agents) to take such action
on such Lender's behalf and to exercise such rights, remedies, powers
and discretions as are specifically delegated to the Agent by this
Agreement together with such powers and discretions as are reasonably
incidental thereto (but subject to any restrictions or limitations
specified in this Agreement). Neither the Agent nor the Security Agent
shall, however, have any duties, obligations or liabilities (whether
fiduciary or
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otherwise) to the other Finance Parties beyond those expressly stated
in this Agreement.
Notwithstanding that the Agent and the Security Agent may from time to
time be the same entity, the Agent and the Security Agent have entered
into this Agreement in their separate capacities as agent for the
Lenders under and pursuant to this Agreement and as Security Agent for
the Beneficiaries (as defined in the Security Trust Deed) to hold the
security created or to be created by the Security Documents on the
terms set out in the Security Trust Deed. However, where this Agreement
provides for the Agent to communicate with or provide instructions to
the Security Agent, while the Agent and the Security Agent are the same
entity, it will not be necessary for there to be any such formal
communications or instructions notwithstanding that this Agreement
provides in certain cases for the same to be in writing.
25.2 AGENT'S ACTIONS
Any action taken by the Agent under or in relation to this Agreement
with requisite authority, or on the basis of appropriate instructions,
received from the Majority Lenders (or as otherwise duly authorised)
shall be binding on all the Lenders.
25.3 AGENT'S DUTIES
The Agent shall:
(a) promptly notify each Lender of the contents of each notice,
certificate or other document received by the Agent from the
Borrower under or pursuant to clause 12;
(b) consult with the Lenders as to whether and, if so, how a
discretion vested in the Agent is, either in any particular
instance or generally, to be exercised; and
(c) (subject to the other provisions of this clause 25) take such
action or, as the case may be, refrain from taking such action
with respect to the exercise of any of its rights, remedies,
powers and discretions as agent as the Majority Lenders may
reasonably direct.
25.4 AGENT'S RIGHTS
The Agent may:
(a) in the exercise of any right, remedy, power or discretion in
relation to any matter, or in any context, not expressly
provided for by this Agreement, act or, as the case may be,
refrain from acting in accordance with the instructions of the
Majority Lenders, and shall be fully protected in so doing;
(b) unless and until it shall have received directions from the
Majority Lenders, take such action, or refrain from taking
such action, in respect of
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a Default of which the Agent has actual knowledge as it shall
deem advisable in the best interests of the Banks (but shall
not be obliged to do so);
(c) refrain from acting in accordance with any instructions of the
Majority Lenders to institute any legal proceedings arising
out of or in connection with this Agreement until it has been
indemnified and/or secured to its satisfaction against any and
all costs, expenses or liabilities (including legal fees)
which it would or might incur as a result;
(d) deem and treat (i) each Lender as the person entitled to the
benefit of the Contribution of such Lender for all purposes of
this Agreement unless and until a Transfer Certificate shall
have been filed with the Agent and shall have become
effective, and (ii) the office set opposite the name of each
Lender in schedule 1 or, as the case may be, in any relevant
Transfer Certificate as such Lender's lending office unless
and until a written notice of change of lending office shall
have been received by the Agent; and the Agent may act upon
any such notice unless and until the same is superseded by a
further such notice;
(e) rely as to matters of fact which might reasonably be expected
to be within the knowledge of any Obligor upon a certificate
signed by any Authorised Signatory of the relevant Obligor;
and
(f) refrain from doing anything which would, or might in its
opinion, be contrary to any law or regulation of any
jurisdiction and may do anything which is in its opinion
necessary or desirable to comply with any such law or
regulation.
25.5 NO LIABILITY OF SECURITY AGENT AND AGENT
None of the Security Agent, the Agent or any of their respective
employees and agents shall:
(a) be obliged to request any certificate or opinion under clause
12 to make any enquiry as to the use of the proceeds of the
Facility unless so required in writing by any Lender, in which
case the Agent shall promptly make the appropriate request of
the relevant Obligor; or
(b) be obliged to make any enquiry as to any breach or default by
any Obligor in the performance or observance of any of the
provisions of any Finance Document or as to the existence of a
Default unless the Agent has actual knowledge thereof or has
been notified in writing thereof by a Lender, in which case
the Agent shall promptly notify the Lenders of the relevant
event or circumstance; or
(c) be obliged to enquire whether or not any representation or
warranty made by any Obligor pursuant to any Finance Document
is true; or
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(d) be obliged to do anything (including, without limitation,
disclosing any document or information) which would, or might
in its opinion, be contrary to any law or regulation or be a
breach of any duty of confidentiality or otherwise be
actionable or render it liable to any person; or
(e) be obliged to account to any Finance Party for any sum or the
profit element of any sum received by it for its own account;
or
(f) be obliged to institute any legal proceedings arising out of
or in connection with, or otherwise take steps to enforce, any
Finance Document other than on the instructions of the
Majority Lenders; or
(g) be liable to any Finance Party for any action taken or omitted
under or in connection with any Finance Document or the
Facility unless caused by its gross negligence or wilful
misconduct.
For the purposes of this clause 25 neither the Agent nor the Security
Agent shall be treated as having actual knowledge of any matter of
which the corporate finance or any other division outside the agency or
loan administration department of the person for the time being acting
as the Agent or Security Agent may become aware in the context of
corporate finance, advisory or lending activities from time to time
undertaken by the Agent or Security Agent for the Borrower or any of
its Subsidiaries or affiliates or associated companies or any other
person which may be a trade competitor of the Group or any member of it
or may otherwise have commercial interests similar to those of the
Group or any member of it.
25.6 NON-RELIANCE ON SECURITY AGENT OR AGENT
Each Finance Party acknowledges, by virtue of its execution of this
Agreement or, as the case may be, a Transfer Certificate, that it has
not relied on any statement, opinion, forecast or other representation
made by the Security Agent or the Agent to induce it to enter into this
Agreement or any other Finance Document and that it has made and will
continue to make, without reliance on the Agent or the Arranger and
based on such documents as it considers appropriate, its own appraisal
of the creditworthiness of the Borrower and the Group and its own
independent investigation of the financial condition, prospects and
affairs of the Borrower and the Group in connection with the making and
continuation of the Facility under this Agreement and the other Finance
Documents. Neither the Security Agent nor the Agent shall at any time
be deemed to have had or have any duty or responsibility, either
historically, initially or on a continuing basis, to provide any
Finance Party with any credit or other information with respect to the
Borrower or any other Group Member whether coming into its possession
before the making of any Drawing or at any time or times thereafter,
other than as provided in clauses 25.3(a) and 25.5(a).
25.7 NO RESPONSIBILITY ON SECURITY AGENT OR AGENT FOR CERTAIN MATTERS
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Neither the Security Agent nor the Agent shall have any responsibility
or liability to any Finance Party:
(a) on account of the failure of any Group Member to perform any
of its obligations under any of the Finance Documents; or
(b) for the financial condition of any Group Member; or
(c) for the completeness, adequacy or accuracy of any statements,
representations or warranties in any of the Finance Documents
or any document delivered under any of such documents; or
(d) for the execution, effectiveness, adequacy, genuineness,
validity, enforceability or admissibility in evidence of the
Finance Documents or of any certificate, report or other
document executed or delivered under any of the Finance
Documents; or
(e) (save as otherwise provided in this clause 25) otherwise in
connection with the Finance Documents or their negotiation or
for acting or, as the case may be, refraining from acting) in
accordance with the instructions of the Majority Lenders.
25.8 RELIANCE ON DOCUMENTS AND PROFESSIONAL ADVICE
The Security Agent and the Agent shall be entitled to rely on any
communication, instrument or document believed by it to be genuine and
correct and to have been signed or sent by the proper person and shall
be entitled to rely as to legal or other professional matters on
opinions and statements of any legal or other professional advisers
selected or approved by it (including those in the Agent's employment).
25.9 OTHER DEALINGS
The Security Agent and the Agent may, without any liability to account
to the other Finance Parties, accept deposits from, lend money to, and
generally engage in any kind of banking or other business with, be the
owner or holder of any shares or other securities of, and provide
advisory or other services to, the Borrower or any of its Subsidiaries,
affiliates or associated companies or any of the Finance Parties as if
it were not the Security Agent or the Agent, as the case may be.
25.10 RIGHTS OF AGENT AND SECURITY AGENT AS LENDER; NO PARTNERSHIP
With respect to its own Commitment and Contribution (if any) the Agent
and the Security Agent shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though it
were not performing the duties and functions delegated to it under this
Agreement and the term "LENDERS" shall, unless the context clearly
otherwise indicates, include the Agent and the Security Agent in its
individual capacity as a Lender. This Agreement
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shall not and shall not be construed so as to constitute a partnership
between the parties or any of them.
25.11 AMENDMENTS AND WAIVERS
(a) Majority Lender matters
Subject to clause 25.11(b) and (c) the Agent may, with the
consent of the Majority Lenders (or if and to the extent
expressly authorised by the other provisions of this
Agreement) and, if so instructed by the Majority Lenders,
shall: (i) agree amendments or modifications to this Agreement
with the Obligors and/or vary or waive breaches of, or
defaults under, or otherwise excuse performance of, any
provision of this Agreement by any Obligor; and/or (ii)
authorise the Security Agent (on behalf of the Finance
Parties) to agree amendments or modifications to the Security
Documents with the Borrower (on behalf of all Obligors) and/or
vary or waive breaches of, or defaults under, or otherwise
excuse performance of, any provision of any of the Security
Documents by any Obligor.
Any such action so authorised and effected by the Agent shall
be documented in such manner as the Agent shall (with the
approval of the Majority Lenders) determine, shall be promptly
notified to the Lenders by the Agent and without prejudice to
the generality of clause 25.2) shall be binding on all the
Lenders.
(b) All Lender matters; security
Except with the prior written consent of all the Lenders, the
Agent shall not have authority on behalf of the Lenders to
authorise the Security Agent to agree amendments or
modifications to the Security Documents with the Obligors (or
the Borrower on their behalf) and/or vary or waive breaches
of, or defaults under, or otherwise excuse performance of, any
provision of any of the Security Documents by any Obligor if
the effect of such would be to: (i) release any Obligor from
the security constituted by any Security Document, (ii)
release any of the charged assets from the security
constituted by any Security Document other than any such
release as part of a disposal made pursuant to the terms of
this Agreement, (iii) release any Obligor from any of its
guarantee or other assurance obligations under any of the
Security Documents or (iv) agree with the Borrower or any
other Obligor any amendment of, or action in relation to, any
of the Security Documents which would have the effect of (x)
extending the due date or reducing the amount of any payment
under any Security Document or (y) changing the currency in
which any amount is payable under any Security Document.
(c) All Lender matters; general
Except with the prior written consent of all the Lenders, the
Agent shall not have authority on behalf of the Lenders to
agree with the Borrower any amendment or modification to this
Agreement or to vary or waive
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breaches of or defaults under or otherwise excuse performance
of any provision of this Agreement by the Borrower, if the
effect of such would be to: (i) reduce the Margin, (ii)
postpone the due date or reduce the amount of any payment of
principal, interest, commitment commission or other amount
payable by the Borrower under this Agreement, (iii) change the
currency in which any amount is payable by the Borrower under
this Agreement, (iv) increase any Lender's Commitment, (v)
extend any period during which a Drawdown Notice may be
delivered, (vi) change the definition of "Majority Lenders" in
clause 1.1, (vii) change any provision of this Agreement which
expressly requires the approval or consent of all the Lenders
such that the relevant approval or consent may be given
otherwise than with the sanction of all the Lenders, (viii)
change the order of distribution under clause 17.3, (ix)
change clause 17.4 or (x) change this clause 25.11.
25.12 REIMBURSEMENT AND INDEMNITY BY LENDERS
Each Lender shall reimburse the Agent (rateably in accordance with (i)
at any time prior to the first Drawdown Date, its Commitment and (ii)
at any time thereafter, the aggregate of its Available Commitment and
its Contribution), to the extent that the Agent is not reimbursed by
the Borrower, for the amount expressed to be payable by the Borrower
under clause 9.3. Each Lender shall on demand indemnify the Agent and
the Security Agent (rateably in accordance with (i) at any time prior
to the first Drawdown Date, its Commitment and (ii) at any time
thereafter, the aggregate of its Available Commitment and its
Contribution) against all liabilities, damages, costs and claims
whatsoever incurred by the Agent in connection with any of the Finance
Documents or the performance of its duties under the Finance Documents
or any action taken or omitted by the Agent or the Security Agent under
any of the Finance Documents, unless such liabilities, damages,
reasonable costs or claims arise from the Security Agent or the Agent's
own gross negligence or wilful misconduct. The Borrower shall
counter-indemnify the Lenders against all payments by them under this
clause 25.12.
25.13 RETIREMENT OF AGENT
(a) The Agent may retire from its appointment as Agent under this
Agreement having given to the Borrower and each of the Lenders
not less than 30 days' notice of its intention to do so,
provided that no such retirement shall take effect unless
there has been appointed by the Lenders as a successor agent:
(i) a Lender nominated by the Majority Lenders with the
approval of the Borrower (not to be unreasonably
withheld or delayed) or, failing such a nomination or
approval,
(ii) any reputable and experienced bank or financial
institution with offices in London nominated by the
Agent with the approval of the Borrower (not to be
unreasonably withheld or delayed), which is a
Qualifying Person.
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Any corporation into which the Agent may be merged or
converted or any corporation with which the Agent may be
consolidated or any corporation resulting from any merger,
conversion, amalgamation, consolidation or other
reorganisation to which the Agent shall be a party shall, to
the extent permitted by applicable law, be the successor Agent
under this Agreement without the execution or filing of any
document or any further act on the part of any of the parties
to this Agreement save that notice of any such merger,
conversion, amalgamation, consolidation or other
reorganisation shall forthwith be given to the Borrower and
the Lenders.
(b) Upon any such successor as aforesaid being appointed, the
retiring Agent shall be discharged from any further obligation
under this Agreement (but shall continue to have the benefit
of this clause 25 in respect of any action it has taken or
refrained from taking prior to such discharge) and its
successor and each of the other parties to this Agreement
shall have the same rights and obligations among themselves as
they would have had if such successor had been a party to this
Agreement in place of the retiring Agent. The retiring Agent
shall (at its sole expense) provide its successor with copies
of such of its records as its successor reasonably requires to
carry out its functions as such.
25.14 CHANGE OF REFERENCE BANKS
If (a) the whole of the Contributions (if any) of any Reference Bank
are prepaid, (b) the Commitment (if any) of any Reference Bank is
reduced to zero in accordance with clause 23.5, (c) a Reference Bank
transfers the whole of its rights and obligations (if any) as a Lender
under this Agreement or (d) a Reference Bank ceases to provide
quotations to the Agent upon request for the purposes of determining
EURIBOR (where such quotations are required having regard to the
definition of "EURIBOR" in clause 1.1) the Agent may, acting on the
instructions of the Majority Lenders, terminate the appointment of such
Reference Bank and after consultation with the Borrower appoint another
Lender to replace such Reference Bank.
25.15 PROMPT DISTRIBUTION OF PROCEEDS
Moneys received by the Security Agent (whether from a Receiver or
otherwise) pursuant to the exercise of (or otherwise by virtue of the
existence of) any rights and powers under or pursuant to any of the
Security Documents and be paid to the Agent for distribution in
accordance with the terms of the Security Deed shall be distributed by
the Agent as soon as is practicable after the relevant moneys are
received by, or otherwise become available to, the Agent save that
(without prejudice to any other provision contained in any of the
Security Documents) the Agent (acting on the instructions of the
Majority Lenders) may credit any moneys received by it to a suspense
account for so long and in such manner as the Agent may from time to
time determine with a view to preserving the rights of the Finance
Parties or any of them to prove for the whole of their respective
claims against any Obligor or any other person liable.
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26 DECISIONS OF LENDERS AND AGENT
26.1 OBLIGATIONS SEVERAL
The obligations of each Lender under this Agreement are several; the
failure of any Lender to perform such obligations shall not relieve any
other Finance Party or the Borrower of any of their respective
obligations or liabilities under this Agreement nor shall any Finance
Party be responsible for the obligations of any other Finance Party
under this Agreement (except to the extent that any person has
obligations in different Finance Party capacities).
26.2 INTERESTS SEVERAL
Notwithstanding any other term of this Agreement (but without prejudice
to the provisions of this Agreement relating to or requiring action by
the Majority Lenders) the interests of the Finance Parties are several
and the amount due to each of the Finance Parties is a separate and
independent debt. Without prejudice to any other provision of this
Agreement (including any requirement for action to be approved or
instigated by, or with the consent or approval of, the Majority Lenders
and, without limitation, clause 26.4), each of the Finance Parties
shall have the right to protect and enforce its rights arising out of
this Agreement and it shall not be necessary for any other Finance
Party to be joined as an additional party in any proceedings for this
purpose.
26.3 MAJORITY LENDERS
(a) If, within 10 Banking Days of the Agent despatching to each
Lender a notice requesting instructions (or confirmation of
instructions) from the Lenders or the agreement of the Lenders
to any amendment, modification, waiver, variation or excuse of
performance for the purposes of, or in relation to, any of the
Documents, the Agent has not received a reply specifically
giving or confirming or refusing to give or confirm the
relevant instructions or, as the case may be, approving or
refusing to approve the proposed amendment, modification,
waiver, variation or excuse of performance, then (irrespective
of whether such Lender responds at a later date) the Agent
shall treat any Lender which has not so responded as having
indicated a desire to be bound by the wishes of a simple
majority of those Lenders (measured in terms of the relevant
Contributions of those Lenders) which have so responded.
(b) For the purposes of clause 26.3, any Lender which notifies the
Agent of a wish or intention to abstain on any particular
issue shall be treated as if it had not responded.
(c) Clause 26.3 shall not apply in relation to those matters
referred to in, or the subject of, clause 25.11(b) and (c).
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26.4 LENDERS ACTING TOGETHER
If the Agent makes a declaration under clause 16.23 the Agent shall, in
the names of all the Lenders, take such action on behalf of the Lenders
and conduct such negotiations with the Borrower and any other members
of the Group and generally administer the Loan in accordance with the
wishes of the Majority Lenders. All the Lenders shall be bound by the
provisions of this clause 26.4 and no Lender shall be entitled to take
action independently against the Borrower or any other Group Member
without the consent of the Majority Lenders.
27 NOTICES AND OTHER MATTERS
27.1 ADDRESS FOR NOTICE
Every notice, request, demand or other communication under this
Agreement shall:
(a) be in writing delivered personally or by first-class prepaid
letter (airmail if available) or telefax;
(b) be deemed to have been received, subject as otherwise provided
in this Agreement, in the case of a letter, when delivered
personally or 5 days after it has been put into the post and,
in the case of a telefax, when a transmission report which
confirms that the transmission has been successfully completed
has been printed by the sender's fax machine (unless the time
of despatch of any telefax is after close of business in which
case it shall be deemed to have been received at the opening
of business on the next business day); and
(c) be sent:
(A) to each Obligor at:
▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Telefax: + 31 20 501 1018
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇ ▇▇▇▇▇
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(B) to the Agent and the Security Agent at:
c/o Nortel plc
Customer Finance Department
▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Telefax: ▇▇▇ (▇) ▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
(C) to each Lender at its address or telefax number
specified in part A of schedule 1 or in any relevant
Transfer Certificate,
or to such other address or telefax number as is notified by
an Obligor, or a Finance Party, as the case may be, to the
Agent and the Security Agent.
27.2 NOTICE TO AGENT
Every notice, request, demand or other communication under this
Agreement to be given by any Obligor to any other party shall be given
to the Agent for onward transmission as appropriate and to be given to
the Obligors shall (except as otherwise provided in this Agreement) be
given by the Agent.
27.3 NO IMPLIED WAIVER, REMEDIES CUMULATIVE
No failure or delay on the part of the Finance Parties or any of them
to exercise any power, right or remedy any Finance Document shall
operate as a waiver thereof, nor shall any single or partial exercise
by the Finance Parties or any of them of any power, right or remedy
preclude any other or further exercise thereof or the exercise of any
other power, right or remedy. The remedies provided in this Agreement
and each of the Security Documents are cumulative and are not exclusive
of any remedies provided by law.
27.4 COUNTERPARTS
This Agreement may be executed in counterparts.
28 GOVERNING LAW AND JURISDICTION
28.1 LAW
This Agreement shall be governed by English law.
28.2 SUBMISSION TO JURISDICTION
The parties to this Agreement agree for the benefit of the Finance
Parties that:
(a) if any party has any claim against any other arising out of or
in connection with this Agreement such claim shall (subject to
clause 28.2(c)) be
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referred to the High Court of Justice in England, to the
jurisdiction of which each of the parties irrevocably submits;
(b) the jurisdiction of the High Court of Justice in England over
any such claim against any Finance Party shall be an exclusive
jurisdiction and no courts outside England shall have
jurisdiction to hear or determine any such claim; and
(c) nothing in this clause 28.2 shall limit the right of the
Finance Parties to refer any such claim against any Obligor to
any other court of competent jurisdiction outside England, to
the jurisdiction of which each Obligor hereby irrevocably
agrees to submit, nor shall the taking of proceedings by any
Finance Party before the courts in one or more jurisdictions
preclude the taking of proceedings in any other jurisdiction
whether concurrently or not.
28.3 AGENT FOR SERVICE OF PROCESS
Each Obligor irrevocably designates, appoints and empowers ▇▇▇▇▇▇▇▇
Chance Secretaries Limited at present of ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ to receive for it and on its behalf service of process issued
out of the High Court of Justice in England in relation to any claim
arising out of or in connection with this Agreement.
28.4 INCONVENIENT FORUM
Each Obligor irrevocably waives any objection it may have now or
hereafter to the laying of venue of any action or proceeding in any
court or jurisdiction referred to in clause 28.2 and any claim it may
have now or hereafter that any action or proceeding brought in such
courts or jurisdiction has been brought in an inconvenient forum.
IN WITNESS whereof the parties to this Agreement have caused this Agreement to
be duly executed on the date first above written.
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SCHEDULE 1
Part A - Initial administrative details of the Lenders
---------------------------------------------------------------------------------
Party Address Fax Number Attention
---------------------------------------------------------------------------------
Nortel Networks c/o Nortel plc ▇▇▇ (▇)▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
International Finance & Customer Finance
Holding B.V. Department
▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
---------------------------------------------------------------------------------
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SCHEDULE 1
Part B - Original Guarantors
NAME COUNTRY OF INCORPORATION ADDRESS
VersaTel Telecom The Netherlands ▇▇▇▇▇▇▇▇▇▇▇ ▇▇,
▇▇▇▇▇▇▇▇▇▇▇ B.V. 1105 BV
Amsterdam Zuidoost,
The Netherlands
VersaTel Telecom Belgium Belgium ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇
▇.▇. ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
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SCHEDULE 2
Form of Drawdown Notice
To: [Agent]
Attention: - Dated: -
EURO 45,378,022 LOAN AGREEMENT DATED - (THE "AGREEMENT")
1 We wish to draw down an Advance in the amount of - on - 1999 with
payment to be made in accordance with our irrevocable instructions to
you contained in clause 4.2 of the Agreement.
2 We attach purchase orders and an acceptance certificate, and the
supplemental agreement to the relevant Asset Charge duly executed in
relation, inter alia, to the relevant Equipment, and
3 We confirm that:
(a) so far as we are aware, no event or circumstance has occurred
and is continuing which constitutes a Default,
(b) the representations and warranties contained in clause 11 of
the Agreement [which are deemed to be repeated pursuant to
clause 11.21 of the Agreement] are true and correct as at the
date of this notice as if made with respect to the facts and
circumstances existing at the date of this notice; and
(c) there is no Material Adverse Effect.
4 Words defined in the Agreement have the same meanings in this notice.
Yours faithfully
VersaTel Telecom Europe B.V.
...........................................
Director
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SCHEDULE 3
Part A - Documents and evidence required as conditions precedent to first
Advance
(a) A copy, certified as a true, complete and up-to-date copy by an
Authorised Officer of the Borrower, of the constitutive documents of
each Obligor in a form acceptable to the Agent.
(b) A copy, certified as a true copy by an Authorised Officer of the
Borrower, of resolutions of the Board of Directors and Shareholders of
the Borrower evidencing approval of this Agreement and the Security
Documents to which it is a party and authorising its appropriate
officers to execute and deliver this Agreement, such Security Documents
and to give all notices and take all other action required by the
Borrower under this Agreement and each such Security Document.
(c) A copy, certified as a true copy by an Authorised Officer of the
Borrower or a director or the secretary of the relevant Obligor of
resolutions of the Supervisory Board or the Board of Directors and
(where relevant) the Shareholders of each Obligor evidencing approval
of this Agreement and the Security Documents to which they are a party
and authorising their respective appropriate officers to execute and
deliver such Security Documents and to give all notices and take all
other action required by such Obligor thereunder.
(d) Specimen signatures, authenticated by an Authorised Officer of the
Borrower or a director or the secretary of the relevant Obligor of the
persons authorised in the resolutions referred to in paragraphs (b) and
(c) above, together with originals of the powers of attorney granted by
the Borrower and any Obligor in connection with the Finance Documents.
(e) Legal Opinions
(i) An opinion of ▇▇▇▇▇▇ ▇▇▇▇, dated not more than five Banking
Days prior to the first Drawdown Date.
(ii) An opinion of Trenite van Doorne, legal advisers to the
Lenders in The Netherlands, dated not more than five Banking
Days prior to the first Drawdown Date.
(iii) An opinion of Huysmans & Partners, legal advisers to the
Lenders on Belgium, dated not more than five Banking Days
prior to the first Drawdown Date.
(f) A copy, certified as a true copy by an Authorised Officer of the
Borrower of a letter from each agent for receipt of service of process
referred to in this Agreement and the Security Deed accepting its
appointment.
(g) The Asset Charges, the Parent Subordinated Loan Agreement and the
Security Deed duly executed by the Obligor as party thereto together
with all documents,
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deeds, notices and certificates required to be delivered pursuant to
the terms thereof.
(h) The Accounts for the financial year ended on 31 December 1998 and the
Quarterly Management Accounts, for the Quarterly Period ended on 31
March 1999.
(i) Copies, certified by an Authorised Officer of the Borrower to be true,
complete and up to date copies of:
(i) the Licences; and
(ii) the Project Agreements; and
(iii) the Notes.
(j) Evidence that a minimum amount of NLG40,000,000 has been subscribed in
cash for equity share capital in the Borrower issued fully paid or lent
to the Borrower pursuant to a Parent Subordinated Loan Agreement (in
each case) by the Parent.
(k) Evidence satisfactory to the Agent that the Group has a satisfactory
level of insurances.
(l) The agreed form Quarterly Management Accounts.
(m) The agreed form Business Plan and Annual Budget.
(n) An agreement to provide a software licence from Nortel Networks and a
letter from Nortel Networks acknowledging the directions in clause
6.3(g).
(o) A structure chart of the Group.
(p) The Supply Agreement, together with all amendments considered necessary
by the Agent.
(q) An opinion from Shearman & Sterling concerning the Notes.
(r) Satisfactory legal due diligence is completed.
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Part B - Documents and evidence required as conditions precedent to Advance
in respect of Reunion Equipment
(a) Confirmation that any additional licence required for the use of the
Reunion Equipment in any country in which such Reunion Equipment is to
be installed has been awarded to the Borrower and is in a form
reasonably satisfactory to the Agent.
(b) Any other conditions precedent as set out in the Supply Agreement which
will cause the amendment of 28 September 1998 to be effective.
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SCHEDULE 4
Calculation of UK Additional Cost
1 The Additional Cost for any period shall be calculated by the Agent in
respect of each period for which it falls to be calculated in
accordance with the following formula:
Y100F
----- = per cent. per annum
100
F = The amount of Sterling per pound sterling 1,000,000 of the fee base
of an authorised institution payable to the Financial Services
Authority per annum (disregarding any minimum fee payable under the
Fees Regulations)
Y = The fraction of foreign currency liabilities taken into account under
the Fees Regulations in calculating the fee base (disregarding any
offset for claims on non-resident offices)
2 For the purposes of calculating the Additional Cost:
(a) the formula is applied on the first day of each period for
which it falls to be calculated (and the result shall apply
for the duration of such period);
(b) each amount is rounded up to the nearest four decimal places;
and
(c) if the formula produces a negative percentage, the percentage
shall be taken as zero.
3 If alternative or additional financial requirements are imposed by the
Lender of England, the Financial Services Authority or any other United
Kingdom governmental authority or agency which in the Agent's opinion
(after consultation with the Lenders) make the formula no longer
appropriate, the Agent shall be entitled by notice to the Borrower to
stipulate such other formula as shall be suitable to apply in
substitution for the formula. Any such other formula so stipulated
shall take effect in accordance with the terms of such notice.
4 In this schedule 4:
"AUTHORISED" and "INSTITUTION" have the meanings given to those terms
in the Banking ▇▇▇ ▇▇▇▇;
"BANK OF ENGLAND ACT" means the Bank of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇;
"FEE BASE" has the meaning given to that term in the Fees Regulations;
and
"FEES REGULATIONS" means the Banking Supervision (Fees) Regulations
1998 or the applicable Transfer regulations made under the Bank of
England Act as are in force on the date of application of the formula.
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SCHEDULE 5
Form of Transfer Certificate
NB 1 Lenders are advised not to employ Transfer Certificates or
otherwise to transfer interests in the Agreement without
first ensuring that the transaction complies with all
applicable laws and regulations, including the Financial
Services ▇▇▇ ▇▇▇▇ and regulations made thereunder.
2 It is expected that Lenders will enter into separate
arrangements dealing with the monies to be paid to the
Transferor Lender by the Transferee in consideration of the
transfer (e.g. principal, accrued interest, fees and any
mismatched funding adjustment). Unless the Effective Date is
a rollover date, mismatches of parties' funding may arise.
The Certificate does not deal with these issues, nor does it
deal with any interim risk participation the Transferor
Lender may grant to the Transferee pending the Effective
Date.
To: - on its own behalf, as agent for the Lenders and on behalf of the
Security Agent, the Borrower and each other party to the Agreement
mentioned below and the Security Trust Deed.
Attention: - [Date]
Transfer Certificate
This Transfer Certificate relates to a euro 45,378,022 Facility Agreement (the
"AGREEMENT") dated - May 1999 between, among others, VersaTel Telecom Europe
B.V. as Borrower (1), the Parent and certain Subsidiaries as Guarantors (2),
Northern Telecom International Finance B.V. as Agent and Security Agent (3) and
the banks and financial institutions whose respective names and addresses are
set out in schedule 1 thereto as Lenders (4). Terms defined in the Agreement
shall have the same meaning in this Transfer Certificate.
1 [Transferor Lender] (the "TRANSFEROR LENDER") (a) confirms the accuracy
of the summary of its participation in the Agreement set out in the
schedule below; and (b) requests [Transfer] (the "Transfer") to accept
by way of transfer the portion of such participation specified in the
schedule hereto by counter-signing and delivering this Transfer
Certificate to the Agent at its address for the service of notices
specified in the Agreement.
2 The Transferee hereby requests the Agent on behalf of itself, the other
Finance Parties, the Obligors and all other parties to the Agreement
and the Priorities Agreement) to accept this Transfer Certificate as
being delivered to the Agent pursuant to and for the purposes of the
Agreement and the Security Deed so as
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to take effect in accordance with the terms thereof on [date of
transfer] (the "EFFECTIVE DATE") or on such later date as may be
determined in accordance with the terms thereof.
3 The Agent (on behalf of itself and the other parties to the Agreement
and the Security Deed) confirms the transfer effected by this Transfer
Certificate pursuant to and for the purposes of the Agreement and the
Security Deed so as to take effect in accordance with the terms
thereof.
4 The Transferee confirms:
(a) that it has received a copy of each of the Documents and all
other documentation and information required by it in
connection with the transactions contemplated by this Transfer
Certificate;
(b) that it has not relied upon any statement, opinion, forecast
or other representation or warranty made by the Transferor
Lender, the Security Agent or the Agent to induce it to enter
into this Transfer Certificate;
(c) that it has made and will continue to make, without reliance
on the Transferor Lender or any other Finance Party, and based
on such documents as it considers appropriate, its own
appraisal of the creditworthiness of the Borrower and the
Group and its own independent investigation of the financial
condition, prospects and affairs of the Borrower and the Group
in connection with the making and continuation of the Facility
under the Agreement and the other Finance Documents;
(d) that neither the Transferor Lender nor any other Finance Party
shall at any time be deemed to have had or have a duty or
responsibility, either historically, initially or on a
continuing basis, to provide the Transferee with any credit or
other information with respect to the Borrower or any other
member of the Group whether coming into its possession before
the making of any Drawing or at any time or times thereafter,
other than (in the case of the Agent) as provided in clauses
24.3(a) and 24.5(a) of the Agreement;
(e) that it has made and will continue to make its own assessment
of the legality, validity, enforceability and sufficiency of
the Finance Documents and this Transfer Certificate and has
not relied and will not rely on the Transferor Lender, the
Security Agent or the Agent or any statements made by any of
them in that respect;
(f) that, accordingly, none of the Transferor Lender, the Security
Agent and the Agent shall make any representations or
warranties in respect of, or shall have any liability or
responsibility to the Transferee in respect of, any of the
foregoing matters or any other matter referred to in clause
24.7 of the Agreement;
(g) that it is [not] a Qualifying Person; and
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(h) that it has signed and agrees to be bound by and comply with
an appropriate confidentiality undertaking issued by the
Transferor Lender.
5 Execution of this Transfer Certificate by the Transferee constitutes
its representation to the Transferor Lender and all other parties to
the Agreement and the Security Deed that it has power to become party
to the Agreement and the Security Deed as a Lender on the terms herein
and therein set out and has taken all necessary steps to authorise
execution and delivery of this Transfer Certificate.
6 The Transferee hereby undertakes to the Transferor Lender, the Finance
Parties, the Obligors and each of the other parties to the Agreement
and the Security Deed that it will perform in accordance with its terms
all those obligations which by the terms of the Agreement and the
Security Deed will be assumed by it after acceptance of this Transfer
Certificate by the Agent.
7 Without limiting the above paragraphs, nothing in this Transferee
Certificate obliges the Transferor Lender to:
(a) accept any re-transfer from the Transferee of any of the
rights, benefits and/or obligations hereby transferred; or
(b) support any losses incurred by the Transfer by reason of any
non-performance by the Borrower or any other party to the
Finance Documents or any document relating thereto of any of
its obligations under the same.
8 This Transfer Certificate and the rights and obligations of the parties
hereunder shall be governed by and construed in accordance with English
law.
Note: This Transfer Certificate is not a security, bond, note, debenture,
investment or similar instrument.
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The Schedule
Commitment Portion Transferred
(pound sterling) (pound sterling)
---------------- -------------------
Contribution Next Interest Payment Date Portion Transferred
(pound sterling) -------------------------- (pound sterling)
---------------- -------------------
ADMINISTRATIVE DETAILS OF TRANSFEREE
Lending Office:
Account for payments:
Telephone:
Telefax:
Attention:
[Transferor Lender] [Transferee]
By: ..................... By: ...................
Date: Date:
The Agent
By:
...................
on its own behalf
and on behalf of the other Finance Parties, the Obligors and all other parties
to the Agreement and the Security Deed.
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SCHEDULE 6
Compliance Certificate to be delivered by an Authorised Officer of the Borrower
[Agent]
Attention: - [Date]
Dear Sirs
VERSATEL TELECOM EUROPE B.V. EURO 45,378,022 CREDIT FACILITIES
LOAN AGREEMENT DATED, MAY 1999 (AS FROM TIME TO TIME AMENDED, VARIED, EXTENDED,
RESTATED, REFINANCED OR REPLACED THE "LOAN AGREEMENT")
We refer to the Loan Agreement and deliver this Certificate in respect of the
Quarterly Period ended [Quarter Day] pursuant to clause 12.1 thereof. Terms
defined in the Loan Agreement shall have the same meaning when used in this
Certificate.
We confirm that:
1 Consolidated EBITDA for the Quarterly Period ending on [Quarter Day]
was [ ] [insert calculation details].
2 Annualised Consolidated EBITDA calculated by reference to the Quarterly
Period ending on [Quarter Day] was [ ] [insert calculation details]
3 As at the end of [Quarter Day] Senior Debt was [ ] [insert
calculation details].
4 As at the end of [Quarter Day] Total Debt was [ ] [insert
calculation details].
5 As at the end of [Quarter Day] Total Relevant Assets were [-].
6 Net Worth as at [Quarter Day] was [ ] [insert calculation details].
Based on the above, we confirm that on [Quarter Day]:
1 The ratio of Senior Debt to Annualised Consolidated EBITDA was [-]
[insert calculation details].
2 The ratio of Total Debt to Net Worth was [-] [insert calculation
details].
3 Free Cash Flow was [-].
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4 The ratio of Consolidated EBITDA to Total Debt Interest Charges was [-]
[insert calculation details].
5 Average revenues per month per Subscriber (other than Subscribers in
respect of any Permitted Acquisition which are not categorised as
Business Subscribers) for such Quarterly Period ending on [Quarter
Day]) was [-].
6 Total revenues received from Subscribers (other than Subscribers in
respect of any Permitted Acquisition which are not categorised as
Business Subscribers) by reference to the Twelve Month Period ending on
[Quarter Day] was [-].
7 Capital expenditure of the System per Subscriber (other than
Subscribers in respect of any Permitted Acquisition which are not
categorised as Business Subscribers) was [-].
Accordingly, we confirm that [save as disclosed in this certificate] on [Quarter
Day] the Borrower was in compliance with those covenants contained in clause 15
inclusive of the Loan Agreement which were applicable as at [Quarter Day].
We confirm that the representations and warranties contained in clause 11 of the
Loan Agreement to be repeated in accordance with clause 11.21 of the Loan
Agreement, are true and correct as at the date hereof as if made with respect to
the facts and circumstances existing at such date.
For and on behalf of
VersaTel Telecom Europe B.V.
....................................
Authorised Officer
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SCHEDULE 7
Project Agreements
1 The Licences
2 The Supply Agreement
3 Interconnect Agreement between the Parent and PTT Telecom B. V. dated
29 May 1997
4 Interconnect Agreement between VersaTel Belgium and Belgacom N.V./S.A.
dated 2 November 1998
5 Shareholders Agreements dated 27 December 1996 relating to the Parent
and between Telecom Founders B. V., Nesbic C.V., Cromwilld Limited, the
Parent, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and Open Skies International, Inc.
6 Interconnect Agreement dated 25 March 1997 between ▇▇▇▇▇▇▇ BV and
VersaTel Telecom International N.V. (formerly Versatel Telecom B.V.).
7 Interconnect Agreement dated 3 December 1997 between Facilicom
International L.L.C. and VersaTel Telecom International B.V. (formerly
Versatel Telecom B.V.).
8 Interconnect Agreement dated 7 May 1996 between Global One
Communications BV and VersaTel Telecom International N.V. (formerly
Versatel Telecom B.V.).
9 Interconnect Agreement dated 6 October 1997 between CasTel N.V. and
VersaTel Telecom International N.V. (formerly Versatel Telecom B.V.).
10 Interconnect Agreement dated 17 November 1998 between InterXion Telecom
BV and VersaTel Telecom International N.V. (formerly Versatel Telecom
B.V.).
11 Interconnect Agreement dated 26 June 1996 between BT (Worldwide) Ltd.
and VersaTel Telecom International N.V. (formerly Versatel Telecom
B.V.).
12 Interconnect Agreement dated 4 February 1999 between WORLDxCHANGE BV
and VersaTel Telecom International N.V. (formerly Versatel Telecom
B.V.).
13 Any interconnect agreements from time to time entered into with any
telecommunications operation by a Group Member
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SCHEDULE 8
Licences
1 Licence in the name of the Parent dated 17 December 1998 from
Onafhankelijke Post en Telecommunicatie Autoriteit, relating to telecom
services
2 Licence in the name of the Parent dated 17 December 1998 from
Onafhankelijke Post en Telecommunicatie Autoriteit, relating to the
telecom network
3 Licence in the name of VersaTel Belgium dated 21 December 1998 from
Belgisch Instituut voor post diensten en telecommunicatie.
4 Licence in the name of VersaTel Belgium B.V. dated 22 June 1998 (came
into force on 21 December 1998).
5 Licence in the name of VersaTel International N.V. (formerly Versatel
Telecom B.V.) dated 3 December 1998 (came into force on 7 January
1999).
Please note that the licence for VersaTel Belgium (referred to in paragraph 4 of
the schedule) is based on a royal decree dated 22 June 1998 and came into force
on 21 December 1998.
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SCHEDULE 9
Part A - Deed of Guarantor Accession
To: - as Security Agent
From: [PROPOSED GUARANTOR] and VERSATEL TELECOM EUROPE B.V.
Date: [ ]
VERSATEL TELECOM EUROPE B.V. euro 45,378,022 Term Loan Agreement dated -, 1999
as from time to time amended, varied, extended, restated, refinanced or replaced
(the "FACILITY AGREEMENT")
We refer to clause 10.16 of the Facility Agreement. Words and expressions
defined in the Facility Agreement have the same meanings when used in this Deed.
We, [name of company] of [address] agree to become an Acceding Guarantor and to
be bound by the terms of the Facility Agreement as an Acceding Guarantor in
accordance with clause 10.17 of the Facility Agreement and the Security Deed as
a Guarantor in accordance with clause 10.5 of the Security Deed.
[LOCAL LAW LIMITATIONS ON AMOUNTS GUARANTEED BY ACCEDING GUARANTOR (IF ANY)]
Our address for notices for the purposes of clause 27.1 of the Facility
Agreement is:
[
]
This Deed is intended to be executed as a deed and is governed by English law.
[PROPOSED GUARANTOR] VERSATEL TELECOM EUROPE B.V.
[Appropriate execution clause] [Appropriate execution clause]
By: By:
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By:
- [Security Agent]
[Appropriate execution clause]
By
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SCHEDULE 9
Part B - Documents and Evidence to be delivered by an Acceding Guarantor
(a) a Deed of Guarantor Accession, a Charging Entity's Deed of Accession
(as defined in the Security Deed) and, if relevant an Asset Charge,
duly executed under seal by the Acceding Guarantor and the Borrower;
(b) a copy of the constitutional documents of each of the Acceding
Guarantor;
(c) a copy of a resolution of the board of directors of each of the
Acceding Guarantor approving the terms of, and the transactions
contemplated by, the Deed of Guarantor Accession, the Charging Entity's
Deed of Accession and the relevant Asset Charge, authorising its
Authorised Officers to execute and deliver the Deed of Guarantor
Accession, the Charging Entity's Deed of Accession and the relevant
Asset Charge, and give all notices and take all other action required
by it under the Finance Documents;
(d) a certificate of a director of the Acceding Guarantor certifying that
the amounts to be guaranteed by the Acceding Guarantor would not cause
any guaranteeing limit binding on it to be exceeded;
(e) a copy of any other authorisation or other document, opinion or
assurance which is necessary for the execution, delivery and validity
and enforceability of the Deed of Guarantor Accession, the Charging
Entity's Deed of Accession and the relevant Asset Charge;
(f) a specimen of the signature of each person authorised by a resolution
referred to in paragraph (c) above;
(g) a legal opinion of English legal advisers, acceptable to the Agent,
addressed to the Security Agent on behalf of the Beneficiaries (as
defined in the Security Deed)
(h) if the Acceding Guarantor is incorporated in a jurisdiction outside
England, a legal opinion of legal advisers, acceptable to the Agent, in
the jurisdiction of incorporation of the Acceding Guarantor (as
appropriate), addressed to the Security Agent on behalf of the
Beneficiaries (as defined in the Security Deed);
(i) a certificate of an Authorised Officer of the Acceding Guarantor
certifying that each copy document specified in part B of this schedule
9 and relating to it is correct, complete and in full force and effect
as at a date no earlier than the date of the Deed of Guarantor
Accession, the Charging Entity's Deed of Accession and the relevant
Asset Charge;
(j) a certificate of an Authorised Officer of the Borrower confirming that
its constitutional documents have not been amended (or, if they have,
enclosing a copy of the amended constitutional documents) and that all
authorisations and resolutions authorising its appropriate officers to
execute and deliver the Deed of
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Guarantor Accession, the Charging Entity's Deed of Accession and the
relevant Asset Charge remain in full force and effect; and
such other documents as the Agent may reasonably require after taking the advice
of the legal advisers referred to in paragraphs (g) and (i) above.
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EXECUTED by the parties:
BORROWER
SIGNED for and on behalf of )
VERSATEL TELECOM EUROPE B.V. )
GUARANTORS
SIGNED for and on behalf of )
VERSATEL TELECOM )
NETHERLANDS B.V. )
SIGNED for and on behalf of )
VERSATEL TELECOM BELGIUM )
N.V. )
SIGNED for and on behalf of )
VERSATEL TELECOM )
INTERNATIONAL N.V. )
LENDERS AND FINANCIAL INSTITUTIONS
SIGNED for and on behalf of )
NORTEL NETWORKS )
INTERNATIONAL FINANCE & )
HOLDING B.V. )
AGENT
SIGNED for and on behalf of )
NORTEL NETWORKS )
INTERNATIONAL FINANCE & )
HOLDING B.V. )
SECURITY AGENT
SIGNED for and on behalf of )
NORTEL NETWORKS )
INTERNATIONAL FINANCE & )
HOLDING B.V. )
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