EXHIBIT 4.2
THIS SUPPLEMENTAL AGREEMENT is dated 28th September, 1998 between:
(1) DUNLOP STANDARD AEROSPACE GROUP LIMITED (registered no. 3573726) an
English company with its registered office at ▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ (the "Company") and each of the other Obligors as defined
in the Original Credit Agreement referred to below and as set out
in Schedule 1;
(2) THE FUJI BANK, LIMITED as arranger of the Facilities (in this
capacity the "Arranger");
(3) THE BANKS AND FINANCIAL INSTITUTIONS set out in Schedule 2 as the
original providers of the Facilities (as defined below) (in this
capacity the "Original Lenders");
(4) THE FUJI BANK, LIMITED as LC Bank (as defined below);
(5) THE FUJI BANK, LIMITED as agent for the Lenders (in this capacity
the "Facility Agent");
(6) THE FUJI BANK, LIMITED as security agent and trustee for the
Lenders (in this capacity the "Security Agent"); and
(7) THE FUJI BANK, LIMITED as syndication manager (in this capacity the
"Syndication Agent").
WHEREAS:
(A) This Supplemental Agreement is supplemental to a credit agreement
dated 31st July, 1998 (the "Original Credit Agreement") made
between, inter alia, the Company, the Arranger, the Original
Lenders and The Fuji Bank, Limited as Facility Agent and Security
Agent pursuant to which the Lenders agreed to make available to the
Borrowers certain term loan facilities, capital expenditure
facilities and revolving credit facilities.
(B) The parties to this Supplemental Agreement have agreed to
supplement and amend the Original Credit Agreement on the terms set
out below.
IT IS AGREED as follows:
1. INTERPRETATION
(a) Capitalised terms not otherwise defined in this Supplemental
Agreement have the meanings given to them in the Original Credit
Agreement, unless the context otherwise requires.
(b) Terms defined in the Recitals hereto have the same meaning when
used in this Supplemental Agreement.
(c) Clause 1.2 of the Original Credit Agreement is deemed to be set out
in full in this Supplemental Agreement but as if references to the
Original Credit Agreement are references to this Supplemental
Agreement.
2. AMENDMENTS TO THE ORIGINAL CREDIT AGREEMENT
The parties to this Supplemental Agreement hereby agree for
themselves and for their successors, transferees and assigns
pursuant to the Original Credit Agreement that, upon the
satisfaction of the conditions precedent set out in Schedule 3
hereto, the Original Credit Agreement shall be supplemented,
amended and restated, and thereafter shall be read and construed
for all purposes, as set out in Schedule 4 to this Supplemental
Agreement.
3. REPRESENTATIONS AND WARRANTIES
Each Obligor represents and warrants to the Agents and each Lender
on the date hereof that:
(a) Powers and authority: It has the power to enter into and
has taken all necessary action to authorise the entry
into and delivery of, this Supplemental Agreement and the
transactions contemplated by this Supplemental Agreement
(including, without limitation, under the Original Credit
Agreement as supplemented and amended by this
Supplemental Agreement).
(b) Legal Validity: Subject to the Reservations, this
Supplemental Agreement constitutes, and the Original
Credit Agreement when supplemented and amended by this
Supplemental Agreement will constitute, its legal, valid
and binding obligation.
(c) Non-conflict: The entry into and performance by it of,
and the transactions contemplated by, this Supplemental
Agreement and the Original Credit Agreement as
supplemented and amended by this Supplemental Agreement
do not and will not:
(i) conflict in any material respect with any law or
regulation or any official or judicial order
applicable to it; or
(ii) conflict with its constitutional documents; or
(iii) conflict in any respect with, or entitle any
third party to terminate, any agreement or
document which is binding upon it, any other
member of the Group or any asset of any member
of the Group in a manner or to an extent which
might have a Material Adverse Effect or would
be reasonably likely to have a material adverse
effect on the business assets or financial
condition of the Company, any Borrower or any
Material Group Subsidiary or in a manner or to
an extent which could result in any liability
on the part of any Finance Party to any third
party.
(d) Authorisations: All authorisations required by any
Obligor in connection with the entry into, performance,
validity and enforceability of, and the transactions
contemplated by this Supplemental Agreement (including,
without limitation, under the Original Credit Agreement)
have been obtained or effected (as appropriate) and are
in full force and effect.
4. INCORPORATION
(a) This Supplemental Agreement is a Senior Finance Document for the
purposes of the Original Credit Agreement and the other Senior
Finance Documents.
(b) This Supplemental Agreement shall, from the date of this
Supplemental Agreement, be deemed to be incorporated as part of the
Original Credit Agreement.
(c) Except as otherwise provided in this Supplemental Agreement, the
Senior Finance Documents remain in full force and effect.
5. MISCELLANEOUS
The provisions of Clauses 26 (Expenses), 29 (Amendments and
Waivers), 36 (Notices) and 37 (Jurisdiction) of the Original Credit
Agreement shall apply to this Supplemental Agreement as though they
were set out in this Supplemental Agreement in full, but as if
references in those Clauses to the Original Credit Agreement were
references to this Supplemental Agreement.
6. COUNTERPARTS
This Supplemental Agreement may be executed in any number of
counterparts, and this has the same effect as if the signatures on
the counterparts were on a single copy of this Supplemental
Agreement.
7. GOVERNING LAW
This Supplemental Agreement is governed by English law.
This Supplemental Agreement has been entered into on the date stated at the
beginning of this Supplemental Agreement.
SCHEDULE 1
The Obligors (other than the Company)
Dunlop Standard Aerospace (UK) Limited ▇▇▇▇▇ Aviation Limited Dunlop Standard
Aerospace Overseas Limited Dunlop Standard Aerospace (US) Inc.
Standard Aerospace (Canada) Limited (previously known as 351439-1 Canada Inc.)
Dunlop Standard Aerospace Holdings Limited
SCHEDULE 2
Lenders
The Fuji Bank, Limited
River ▇▇▇▇▇ ▇▇▇▇▇
▇-▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
SCHEDULE 3
Conditions Precedent
A certified copy of a resolution of the board of directors of each
of the Company (on behalf of itself and as Obligors' Agent on
behalf of the other Obligors) and Dunlop Standard Aerospace (US)
Inc. approving the terms of, and the transactions contemplated by,
this Supplemental Credit Agreement and the Original Credit
Agreement as supplemented, amended and restated by this
Supplemental Credit Agreement and resolving that it execute this
Supplemental Credit Agreement.
CONFORMED COPY
SUPPLEMENTAL CREDIT AGREEMENT
DATED 28th September, 1998
Between
DUNLOP STANDARD AEROSPACE GROUP LIMITED
and others as Borrowers and/or Guarantors
THE FUJI BANK, LIMITED
as Arranger
THE LENDERS
THE FUJI BANK, LIMITED
as Facility Agent and Security Agent
and
THE FUJI BANK, LIMITED
as Syndication Agent
___________________________________________
relating to a Credit Agreement dated
31st July, 1998
_____________________________________________
▇▇▇▇▇ & OVERY
London
B3:139964.5
CONTENTS
Clause Page
1. Interpretation....................................................1
2. Amendments to the Original Credit Agreement.......................2
3. Representations and Warranties....................................2
4. Incorporation.....................................................2
5. Miscellaneous.....................................................3
6. Counterparts......................................................3
7. Governing Law.....................................................3
Schedules
Schedule 1 - The Obligors....................................................4
Schedule 2 - Lenders.........................................................5
Schedule 3 - Conditions Precedent............................................6
Schedule 4 - Conformed Copy Amended and Restated Credit Agreement............7
Signatories..................................................................181
THIS CREDIT AGREEMENT is dated 31st July, 1998 and made between:
(1) DUNLOP STANDARD AEROSPACE GROUP LIMITED (registered no. 3573726) an
English company with its registered office at ▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇ (the "Company");
(2) THE COMPANIES listed in Part I of Schedule 1 as borrowers and
drawers (in this capacity each an "Original Borrower");
(3) THE COMPANIES listed in Part II of Schedule 1 as guarantors (in
this capacity each an "Original Guarantor");
(4) THE FUJI BANK, LIMITED as arranger of the Facilities (in this
capacity the "Arranger");
(5) THE BANKS AND FINANCIAL INSTITUTIONS set out in Schedule 2 as the
original providers of the Facilities (as defined below) (in this
capacity the "Original Lenders");
(6) THE FUJI BANK, LIMITED as LC Bank (as defined below);
(7) THE FUJI BANK, LIMITED as agent for the Lenders (in this capacity
the "Facility Agent");
(8) THE FUJI BANK, LIMITED as security agent and trustee for the
Lenders (in this capacity the "Security Agent"); and
(9) THE FUJI BANK, LIMITED as syndication manager (in this capacity the
"Syndication Agent").
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Agreement terms defined above or in Clause 22 have the same
meaning when used in this Agreement and:
"Accountants' Report" means the reports dated on or before the
Signing Date prepared by PricewaterhouseCoopers and addressed,
amongst others, to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co Limited and the Company.
"Accounting Date" means each 31st March, 30th June, 30th September
and 31st December falling after the Closing Date, save as any such
date may be adjusted by the Company with the agreement of the
Facility Agent to avoid an Accounting Date falling on a day which
is not a Business Day and/or to ensure that all Accounting Dates
fall on the same day of the week.
"Accounting Period" in relation to any person means any period of
approximately one month, three months or one year for which
Accounts of such person are required to be prepared ending, in the
case of each three month and each one year period, on an Accounting
Date, provided that the first quarterly Accounting Period of the
Group shall commence on the Closing Date and end on 30th September,
1998.
"Accounts" means at any time the latest audited or unaudited, as
the case may be, consolidated accounts of the Group and any other
accounts of any member of the Group in each case delivered or
required to be delivered to the Facility Agent pursuant to this
Agreement, as the context requires.
"Acquired Assets" means the shares and assets acquired or to be
acquired by the Company and certain of its Subsidiaries pursuant to
the terms of the Sale and Purchase Agreements (and as referred to
in Clause 2 of the UK Sale and Purchase Agreement or Clause 2 of
the US Sale and Purchase Agreement) and all other rights, assets
and liabilities (tangible and intangible, present and future,
actual and contingent) acquired by the Company or its Subsidiaries
pursuant to the Sale and Purchase Agreements.
"Acquisition" means the acquisition of the Acquired Assets by the
Company or its Subsidiaries pursuant to the Acquisition Agreements.
"Acquisition Agreements" means:
(a) the Sale and Purchase Agreements;
(b) the Dunlop Deed of Amendment (as defined in the UK Sale and
Purchase Agreement);
(c) the ▇▇▇▇▇ Intellectual Property Licence and the ▇▇▇▇▇ IPR
Assignment (each as defined in the UK Sale and Purchase
Agreement);
(d) the Vendors' Guarantor's Indemnity (as defined in the UK Sale
and Purchase Agreement);
(e) the SWSW Licence (as defined in the US Sale and Purchase
Agreement); and
(f) the letter umbrella agreement between the Company and BTR
International Limited,
and all transfers and other instruments made pursuant to any
thereof to which the Company, the Vendors or any member of the
Group is a party.
"Acquisition Costs" means all fees, costs, expenses, stamp,
registration and capital taxes incurred by the Company (or any
other member of the Group) in connection with the negotiation,
preparation, execution and registration of the Transaction
Documents.
"Additional Borrower" means a member of the Group which becomes a
Borrower in accordance with Clause 19.1.
"Additional Cost" means (a) in relation to each Utilisation or
overdue amount, the cost as calculated by the Facility Agent in
accordance with Schedule 10 imputed to each Lender participating in
such Utilisation or overdue amount through a Facility Office in the
United Kingdom of compliance with the Mandatory Cost requirements
of the Bank of England during that Interest Period, expressed as a
percentage rate per annum and, (b) in relation to each Utilisation
or overdue amount denominated in Dollars made to or owed by a U.S.
Obligor, the rate per annum determined from the formula (A)(i)
LIBOR applicable to such Utilisation or amount for the relevant
Interest Period divided by (ii) 1 minus the Euro-Dollar Reserve
Percentage minus (B) LIBOR applicable to such Utilisation or
overdue amount for that Interest Period and (c) without double
counting, in relation to each Utilisation or overdue amount the
rate per annum certified by any Lender to the Facility Agent to be
the cost to that Lender of compliance with all reserve assets,
liquidity or cash margin or other requirements of any applicable
monetary or other authority with whose requirements that Lender is
required or accustomed to comply in relation to that Utilisation or
overdue amount.
"Additional Guarantor" means a member of the Group which becomes a
Guarantor in accordance with Clause 19.2.
"Advance" means the principal amount of each borrowing under this
Agreement from (a) the Tranche A Commitments (each a "Tranche A
Advance"), or (b) the Tranche B Commitments (each a "Tranche B
Advance"), or (c) the Tranche C Commitments (each a "Tranche C
Advance"), or (d) the Tranche D Commitments (each a "Tranche D
Advance"), or (e) the Tranche E Commitments (each a "Tranche E
Advance") or, in each case, the principal amount thereof
outstanding from time to time and without any such designation
means a Tranche A Advance, a Tranche B Advance, a Tranche C
Advance, a Tranche D Advance or a Tranche E Advance as the context
requires.
"Aero Engine Equipment Division" means the businesses of designing
and manufacturing heat exchangers, bleed valves, combustion
heaters, air/oil separators, process heat exchangers and actuators
carried on by Dunlop Aerospace Limited, Dunlop Limited, Dunlop
Holdings Limited, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ South Wind Corporation and ▇▇▇▇▇
Aviation Limited from time to time and including the business of
designing and manufacturing customised high technology rubber and
polymer products.
"Affiliate" in relation to any person means a Subsidiary or a
Holding Company of that person and any other Subsidiary of a
Holding Company of that person.
"Agent" means the Facility Agent, the Syndication Agent or the
Security Agent, as the context requires.
"Agent's Spot Rate of Exchange" with respect to any Optional
Currency on any day means the spot rate of exchange of the Facility
Agent (as determined by the Facility Agent) for the purchase of the
appropriate amount of such Optional Currency with Sterling in the
London Foreign Exchange Market in the ordinary course of business
at or about 10.00 a.m. on the day in question for delivery two
Business Days thereafter.
"Agreed Security Principles" means the memorandum entitled
"Security Principles" in the agreed form.
"Agreed Syndication List" means the list in the agreed form of
those banks, financial institutions or trusts to which
participations in the Facilities may be transferred without further
consent of the Company.
"Ancillary Bank" means any Bank which becomes an Ancillary Bank by
operation of Clause 7.
"Ancillary Commitment" means, at any time, the maximum principal
amount permitted to be made available under the Ancillary Facility,
relative thereto (which shall not, in any event exceed the Tranche
D Commitment of the relevant Ancillary Bank) to the extent not
cancelled or reduced under this Agreement.
"Ancillary Documents" means the documents and other instruments
pursuant to which the Ancillary Facility is made available and the
Ancillary Outstandings are evidenced.
"Ancillary Outstandings" means, at any time and with respect to any
Ancillary Bank, the aggregate in Sterling (as calculated by such
Ancillary Bank) of all of the following amounts outstanding at such
time under the Ancillary Facility of such Ancillary Bank then in
force:
(a) all amounts of principal then outstanding under any
overdraft, cheque drawing or other current account
facilities determined on the same basis (whether net or
gross) as that for determination of any limit on such
facilities imposed by the terms thereof;
(b) the maximum potential liability (excluding amounts stated
to be in respect of interest) under all guarantees, bonds
and letters of credit then outstanding under any
guarantee, bond, letter of credit or acceptance
facilities comprised in the Ancillary Facility; and
(c) in respect of any other facility or financial
accommodation, such other amount as fairly represents the
aggregate exposure of that Ancillary Bank with respect
thereto under its Ancillary Facility, as reasonably
determined by that Ancillary Bank from time to time in
accordance with its usual banking practice for facilities
or accommodation of the relevant type.
"Applicable Accounting Principles" means for the purposes of the
preparation and/or audit of any Accounts (whether consolidated or
unconsolidated):
(a) of the Company or any member of the Group incorporated in
England and Wales to be delivered hereunder, accounting
principles and practices generally accepted in the United
Kingdom and approved by the Institute of Chartered
Accountants of England and Wales or other applicable
authority and which are consistent with the accounting
principles and practices applied in the preparation of
the Business Plan and the Accountants Report, and any
variation to such accounting principles and practices
which has been approved under Clause 21.5(c); and
(b) of any other member of the Group, accounting principles
and practices generally accepted in the country in which
such member is incorporated and approved by the relevant
local accounting standards board or other applicable
authority consistently applied, and any variation to such
accounting principles and practices which have been
approved under Clause 21.5(c).
"Approved Bank" means the current clearing banks used by members of
the Target Group in each jurisdiction unless the Majority Lenders
notify the Obligors' Agent prior to Closing that they do not so
approve of any such current bank or any other bank in such
jurisdiction from time to time notified to the Facility Agent which
has a short term rating of P1/A1 from Standard & Poors Corporation
or ▇▇▇▇▇'▇ Investor Services Inc., provided always that any such
bank in the United Kingdom, the United States of America or Canada
shall only be an Approved Bank if it has first been given and has
acknowledged to the Security Agent any and all notices required by
the Security Documents.
"Auditors" means any of PricewaterhouseCoopers, Ernst & Young,
KPMG, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or Deloitte & Touche, or any successor firm
of any of them appointed to audit the annual consolidated Accounts
of the Company.
"Available Facility Amount" means the amount of the Tranche D
Commitments less the Original Sterling Amount of the then
outstanding Tranche D Utilisations at such time taking into account
any Tranche D Utilisations scheduled to be made, repaid or prepaid
by assuming that the same occurs when due.
"Availability Period" means the period from the date of this
Agreement to (a) in respect of the Tranche A Commitments, the
Tranche B Commitments and the Tranche C Commitments, close of
business in London on the date three months from the Signing Date
(respectively, the "Tranche A Availability Period", the "Tranche B
Availability Period" and the "Tranche C Availability Period"), and
(b) in respect of the Tranche D Commitments, close of business in
London on the date one month prior to the Final A Repayment Date or
if earlier the date that all amounts outstanding under the Tranche
A Facility, the Tranche B Facility, the Tranche C Facility and the
Tranche E Facility have been repaid or prepaid in full (the
"Tranche D Availability Period"), and (c) in respect of the Tranche
E Commitments, close of business in London on the seventh
anniversary of Closing (the "Tranche E Availability Period").
"Base Financial Statements" means the Accounts (as defined in each
of the Sale and Purchase Agreements), including without limitation
the management reports for the members of the Target Group for May
1998.
"Borrower" means an Original Borrower or an Additional Borrower.
"Borrower Accession Agreement" means a letter substantially in the
form of Part II of Schedule 6 with such amendments as the Facility
Agent may approve or reasonably require.
"Borrowings" means any indebtedness (including any interest and
other charges relating thereto) in respect of:
(a) moneys borrowed or raised and debit balances at banks;
(b) any debenture, ▇▇▇▇, ▇▇▇▇, note, loan stock or other
security;
(c) any acceptance or documentary credit;
(d) receivables sold or discounted (otherwise than on a
non-recourse basis);
(e) the acquisition cost of any asset or service to the
extent payable before or after the time of acquisition or
possession by the party liable where the advance or
deferred payment (i) is arranged primarily as a method of
raising finance or financing the acquisition of that
asset or service or (ii) is normal in the trade concerned
and the advance is expressed to be payable more than 180
days before, or the deferred payment is payable more than
180 days after, the date of acquisition or possession of
such asset;
(f) finance leases and hire purchase and other arrangements
treated as finance leases in accordance with the
Applicable Accounting Principles or which are entered
into primarily as a method of raising finance or
financing the acquisition of the asset leased;
(g) currency or interest rate swap, or hedging arrangements
or financial futures transactions provided that any such
arrangements or transactions shall be valued at the net
amount owing to any counterparty under any such
arrangement or transaction (to the extent that the
underlying contract provides for net payments);
(h) any other transaction having the commercial effect of a
borrowing (whether involving money or commodities); or
(i) any guarantee, indemnity, letter of credit or similar
assurance against financial loss of any person in respect
of any indebtedness falling within paragraphs (a) to (h)
inclusive and any legally binding agreement to maintain
the solvency of any person whether by investing in,
lending to or purchasing any assets of such person.
"Bridge Documents" means the Bridge Facility Agreement, any related
fee letter, the Substitution Certificates, the Novation Agreements
and Guarantor Accession Agreements (each as defined in the Bridge
Facility Agreement), the Security Documents and the Priority
Agreement and the Warrant Instrument (as defined in the Bridge
Facility Agreement).
"Bridge Facility Agreement" means the bridge facility agreement
dated on or about the date hereof made between, amongst others,
Dunlop Standard Aerospace Holdings Limited and others, The Fuji
Bank, Limited as Arranger, Original Lender, Bridge Agent and the
Security Agent.
"Business Day" means:
(a) a day (other than a Saturday or a Sunday) on which banks
and foreign exchange markets are open for business in
London of the type contemplated by this Agreement
including for the giving and receiving of notices under
this Agreement; and
(b) in respect of a day on which a payment or other
transaction in an Optional Currency is required under
this Agreement a day (not being a Saturday or Sunday) on
which banks and foreign exchange markets are open for
business in:
(i) the principal financial centre in the country
of that Optional Currency, or, if there is more
than one relevant country, the countries
designated by the Facility Agent; and
(ii) the principal financial centre of the country
of the place of payment of the transaction or,
if more than one relevant country, the
countries designated by the Facility Agent.
"Business Plan" means the base case model prepared by ▇▇▇▇▇▇▇
▇▇▇▇▇▇ & Co Limited and approved by the Executives in the agreed
form.
"Canadaco" means Standard Aerospace (Canada) Limited (previously
known as 351439-1 Canada Inc.).
"Canadian Dollars" and "C$" means the lawful currency for the time
being of Canada.
"Canadian Re-organisation" means the merger of Canadaco with BTR
Canada Inc. and Standard Aero Limited, as described in the
Structure Memorandum.
"Capex Blocked Account" means the account in the name of Holdco
opened with the Facility Agent at its London office as referred to
in Clause 4.4.
"Capital Expenditure" means any expenditure which should be treated
as capital expenditure in the audited consolidated Accounts of the
Group in accordance with the Applicable Accounting Principles
(which shall include for the avoidance of doubt, (i) expenditure on
rental engine spares, (ii) any loans made to or subscriptions for
shares or other investments in any Joint Venture (including,
without limitation, the ▇▇▇▇▇ Air Force Base Joint Venture) save to
the extent such loans, subscriptions or investments are to be used
to fund working capital of such Joint Venture, and (iii) Deferred
Costs).
"Cash Equivalent Investments" means:
(a) debt securities (denominated in Sterling, Canadian
Dollars or Dollars) issued by the government of the
United Kingdom or Canada or the United States of America
having not more than six months to final maturity and
which are not convertible into any other form of
security;
(b) debt securities (denominated in Sterling, Canadian
Dollars or Dollars) which have not more than 60 days to
final maturity, are not convertible into any other form
of security, are rated P1 (▇▇▇▇▇'▇ Investor Services
Inc.) and A-1 (Standard & Poor's Corporation) and are not
issued or guaranteed by any member of the Group; and
(c) such other securities (if any) as are approved as such in
writing by the Facility Agent.
"Certificates of Title" means the certificates of title in the
agreed form prepared by ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ with respect to the
Key Properties (other than the property at Bagworth as identified
in the Debenture) addressed to inter alia, the Facility Agent, the
Security Agent and the Lenders.
"Chief Executive Officer" means the chief executive officer of the
Company from time to time (being ▇▇▇▇▇▇ ▇. Hamaberg at the Closing
Date).
"Chief Financial Officer" means the finance director of the Company
from time to time (being ▇▇▇▇▇ ▇▇▇▇▇ at the Closing Date) or in his
absence his deputy (being a director of the Company).
"Closing" means the completion of the Acquisition.
"Closing Accounts" means accounts in the names of the Company and
the Original Borrowers, Dunlop Aerospace Limited and BTR Canada Inc
opened with the Facility Agent (and/or its Subsidiaries) before and
for the purposes of Closing.
"Closing Date" means the date on which Closing occurs pursuant to
the Sale and Purchase Agreements, being the first Utilisation Date.
"Commitment" in relation to a Lender means:
(a) when designated "Tranche A", "Tranche B", "Tranche C",
"Tranche D" or "Tranche E", the amount appearing and
designated as such against that Lender's name in Schedule
2 or in a Transfer Agreement or other document by which
it became party to or acquired rights under this
Agreement; or
(b) without any such designation, a Lender's Tranche A
Commitment or Tranche B Commitment or Tranche C
Commitment or Tranche D Commitment or Tranche E
Commitment, as the context requires,
in each case as reduced or increased from time to time pursuant to
any Transfer Agreement or other transfer pursuant to Clause 30 to
which such Lender is party, and to the extent not cancelled,
reduced, transferred or terminated under this Agreement
(collectively the "Total Commitments").
"Dangerous Substance" means any radioactive emissions, noise and
any natural or artificial substance (in whatever form) the
generation, transportation, storage, treatment, use or disposal of
which (whether alone or in combination with any other substance)
gives rise to a risk of causing harm to man or any other living
organism or damaging the Environment or public health or welfare,
including (without limitation) any controlled, special, hazardous,
toxic, radioactive or dangerous waste.
"Debenture" means the mortgage debenture dated on or about the
Signing Date entered into by the Company and the Chargors (as
defined therein) in favour of the Security Agent, as supplemented
by any deeds of accession or other instruments supplemental
thereto.
"Default" means an Event of Default or an event which, with the
giving of notice, lapse of time, determination of materiality or
fulfilment of any other applicable condition (where such other
condition is specified in this Agreement as being applicable) or
combination of the foregoing, would constitute an Event of Default
provided that any such event which requires the satisfaction of a
condition as to materiality before it becomes an Event of Default
shall not be a Default until that condition is satisfied.
"Deferred Costs" means any annual expenditure that may be deferred
in the audited consolidated Accounts of the Group to be matched
against future revenue streams in accordance with the Applicable
Accounting Principles (which, for the avoidance of doubt, shall
include original equipment manufacturer ("OEM") authorisation and
licensing fees, costs of equipment provided free of charge to
OEM's, the cost of acquiring rental engines and development costs
and shall exclude amortisation) less the amount of any cash
proceeds of any sale and leasebacks.
"Disclosure Letter" means the letter designated the "Disclosure
Letter" dated on or before the Signing Date from the Company to the
Facility Agent counter-signed by the Facility Agent for the
purposes of identification which makes specific disclosures against
the representations and warranties set out in Clause 20.
"Disposals Account" means the blocked account held with the
Facility Agent as defined in Clause 9.5.
"Documentary Credit" means any letter of credit, guarantee or bond
issued or to be issued pursuant to Clause 5.5, in each case as
varied from time to time.
"Dollars" and "$" means the lawful currency for the time being of
the United States of America.
"Dunlop Aviation Division" means the businesses of designing,
manufacturing and servicing wheel and braking systems and brake
management systems for the international civil and military
aircraft markets and designing and manufacturing electro-thermal
de-icing and ice protection systems carried on by Dunlop Holdings
Limited, Dunlop Limited, Dunlop Aerospace Limited, Dunlop Aviation
(SE ASIA) Pte Limited, Dunlop Aviation North America Inc. and
Dunlop Aviation Canada Inc. from time to time.
"Dunlop Investments" means Dunlop Standard Aerospace Overseas
Investment Limited (registered number 3599223).
"Dutchco" means a new company to be incorporated in the Netherlands
on or after the Closing Date with the name Dunlop Standard
Aerospace (Nederland) B.V.
"Encumbrance" means any mortgage, pledge, lien, charge (fixed or
floating), assignment for the purpose of providing security,
hypothecation, right in security, security interest or trust
arrangement for the purpose of providing security, and any other
security agreement or other arrangement having the effect of
providing security (including, without limitation, the deposit of
monies or property with a person with the primary intention of
affording such person a right of set-off or lien).
"Environment" means all, or any of, the following media, the air
(including, without limitation, the air within buildings and the
air within other natural or man-made structures above or below
ground), water (including, without limitation, ground and surface
water) and land (including, without limitation surface and
sub-surface soil).
"Environmental Claim" means any claim by any person:
(a) in respect of any loss or liability suffered or incurred
by that person as a result of or in connection with any
violation of Environmental Law; or
(b) that arises as a result of or in connection with
Environmental Contamination and that could give rise to
any remedy or penalty (whether interim or final) that may
be enforced or assessed by private or public legal action
or administrative order or proceedings.
"Environmental Contamination" means each of the following and their
consequences:
(a) any release, discharge, emission, leakage or spillage of
any Dangerous Substance at or from any site owned,
occupied or used by any member of the Group into any part
of the Environment; or
(b) any accident, fire, explosion or sudden event at any site
owned, occupied or used by any member of the Group which
is directly or indirectly caused by or attributable to
any Dangerous Substance; or
(c) any other pollution of the Environment.
"Environmental Law" means all laws (including, without limitation,
common law), regulations, directives, codes of practice, circulars,
guidance notices and the like having in each case legal effect
concerning the protection of human health, the Environment, the
conditions of the work place or the generation, transportation,
storage, treatment or disposal of Dangerous Substances.
"Environmental Licence" means any permit, licence, authorisation,
consent or other approval required by any Environmental Law.
"ERISA" means the United States Employee Retirement Income Security
Act of 1974 as amended from time to time, or any successor statute
thereto and any regulations promulgated thereunder.
"ERISA Affiliate" means each person (as defined in Section 3(9) of
ERISA), whether or not incorporated which would be considered a
single employer with any Obligor domiciled in the United States
within the meaning of Section 414(b), (c), (m) or (o) of the IRC
and regulations promulgated under those sections or within the
meaning of Section 4001(b) of ERISA but not including an Investor
or any company (other than a member of the Group) which is owned,
in whole or in part, by an Investor.
"Euro-Dollar Reserve Percentage" means, for any day, that
percentage (expressed as a decimal) which is in effect on such day,
as prescribed by the Board of Governors of the Federal Reserve
System of the U.S.A. (or any successor), for determining the
maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five
billion Dollars in respect of "Eurocurrency liabilities" as
specified in Regulation D (or in respect of any other category of
extensions of credit or other assets which includes loans by a
non-United States office of any bank to United States residents).
"Event of Default" means an event specified as such in Clause 23.1.
"Excess Cash Capex Amount" for any annual Accounting Period
starting on or after 1st January, 1999 means the amount by which
(A) the aggregate of all cash (not being cash standing to the
credit of a Disposals Account) and Cash Equivalent Investments held
by members of the Group on the 31st December immediately preceding
the start of such annual Accounting Period, less the amount of any
Tranche D Advances then outstanding, is in excess of (B)
(pound)12,500,000 (or its equivalent in other currencies) less the
amount of the Total Purchase Price paid or incurred by members of
the Group during the previous annual Accounting Period to the
extent the amount of such payment was permitted by Clause
21.15(d)(i)(C).
"Executive" means each of ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇-▇▇▇▇▇▇, the Chief Executive Officer and the Chief Financial
Officer (or any of their replacements from time to time as
contemplated in Clause 21.33).
"Expiry Date" means the date stated in a Documentary Credit to be
its expiry date or the latest date on which demand may be made
thereunder.
"Facility" means each and any of:
(a) the term loan facility referred to in Clause 2.1(a) (the
"Tranche A Facility");
(b) the term loan facility referred to in Clause 2.1(b) (the
"Tranche B Facility");
(c) the term loan facility referred to in Clause 2.1(c) (the
"Tranche C Facility");
(d) the revolving credit facility referred to in Clause 2.1(d) (the
"Tranche D Facility");
(e) the term loan facility referred to in Clause 2.1(e) (the
"Tranche E Facility"); and
(f) an ancillary facility referred to in Clause 2.1(f) (an
"Ancillary Facility"),
(together the "Facilities").
"Facility Office" means in relation to any Lender the office or
offices specified as such in Schedule 2 or in the Transfer
Agreement by which such Lender became a party hereto or such other
office notified by such Lender to the Facility Agent by not less
than five Business Days' notice as the office through which it will
perform all or any of its obligations under this Agreement.
"Fee Letters" means the letters referred to in Clauses 25.1 and
25.3.
"Final Maturity Date" means the ninth anniversary of the first
Utilisation Date.
"Final A Repayment Date" means the date 90 months from the first
Utilisation Date.
"Finance Documents" means:
(a) when designated "Senior", this Agreement, the Fee
Letters, the Ancillary Documents, the Transfer
Agreements, the Borrower Accession Agreements, the
Guarantor Accession Agreements, the Security Documents,
the Hedging Documents, the Priority Agreement and any
other document designated as such by the Facility Agent
and the Company;
(b) when designated "Subordinated", the Subordinated
Documents or the Bridge Documents as the context
requires; and
(c) without any such designation the Senior Finance Documents
and/or the Subordinated Finance Documents as the context
requires,
in each case as amended, novated or supplemented from time to time.
"Finance Party" means the Arranger, a Lender, the LC Bank or the
Agents (together the "Finance Parties").
"Funds Flow Statement" means the chart and memorandum in the agreed
form showing the payments to be made by any member of the Group or
the Target Group at or immediately after Closing.
"Group" means the Company and its Subsidiaries from time to time.
"Guarantor" means an Original Guarantor or an Additional Guarantor.
"Guarantor Accession Agreement" means a deed substantially in the
form of Part III of Schedule 6 with such amendments as the Facility
Agent may approve or reasonably require.
"Guilders" and "DFL" means the lawful currency for the time being
of the Netherlands.
"Hedging Documents" means any and all currency or interest rate
swap and/or interest cap and/or other hedging agreements entered
into or to be entered into by any member of the Group as may from
time to time be agreed in writing between the Company and the
Facility Agent to constitute the Hedging Documents.
"Holdco" means Dunlop Standard Aerospace (UK) Limited (registered
no. 3599229).
"Holding Company" means an entity of which another person is a
Subsidiary.
"Information Package" means the Business Plan and, when and to the
extent agreed between the Company and the Syndication Agent, an
information memorandum relating to the Group to be prepared for the
purposes of syndication.
"Insolvent Group Member" means any member of the Group:
(a) which:
(i) is, or is deemed or declared for the purposes
of any law to be, unable to pay its debts as
they fall due or to be insolvent, or admits in
writing its inability to pay its debts as they
fall due unless such member of the Group is
deemed to be insolvent solely under section
123(1)(a) of the Insolvency ▇▇▇ ▇▇▇▇ in
circumstances where it is contesting the
relevant debt in good faith and with due
diligence; or
(ii) suspends making payments on all or any class of
its debts or announces an intention to do so,
or a moratorium is declared in respect of any
of its indebtedness; or
(iii) by reason of financial difficulties, begins
negotiations with its creditors generally with
a view to the readjustment or rescheduling of
any of its indebtedness; or
(b) in respect of which:
(i) any step is taken by, or on behalf of, that
company (including petition, proposal or
convening a meeting) with a view to a
composition, assignment or arrangement with any
of its creditors; or
(ii) a meeting is convened by the company, its
directors or its shareholders for the purpose
of considering any resolution for (or to
petition for) its winding-up or its
administration or any such resolution is passed
(not being a solvent liquidation); or
(iii) any person presents a petition for its
winding-up or administration (not being a
frivolous or vexatious petition and not being a
solvent liquidation); or
(iv) any order for its winding-up or administration
is made (not being a solvent liquidation); or
(v) any other step is taken by or on behalf of that
company (including petition, resolution,
proposal or convening a meeting) with a view to
the rehabilitation, administration,
custodianship, liquidation, winding-up or
dissolution of it; or
(vi) any liquidator, trustee in bankruptcy, judicial
custodian, compulsory manager, receiver,
administrative receiver, administrator or the
like is appointed; or
(vii) its directors request the appointment of a
liquidator, trustee in bankruptcy, judicial
custodian, compulsory manager, receiver,
administrative receiver, administrator or the
like; or
(viii) any other steps are taken to enforce any
Encumbrance over any material part of its
assets, save where it is in good faith
contesting such enforcement by appropriate
proceedings,
unless (in the case only of any action, other than the
convening of a meeting to consider a resolution or to
petition for the administration of the relevant company
or the presentation of a petition or making of an order
for administration or taking of any other step with a
view to administration or appointment of an
administrator, referred to in paragraph (ii), (iii),
(iv), (v), (vi) and (vii) above) the Company demonstrates
to the Facility Agent's satisfaction that the action has
been dismissed or revoked within 21 days; or
(c) in respect of which there occurs in any country or
territory in which it is incorporated or carries on
business any event which, in the reasonable opinion of
the Majority Lenders, corresponds to or is analogous with
any of the events mentioned in paragraphs (a) or (b)
above.
"Intellectual Property Rights" means all know-how, patents,
trademarks, service marks, designs, business names, topographical
or similar rights, copyrights and other intellectual property
rights and any interests (including by way of licence) in any of
the foregoing (in each case whether registered or not and including
all applications for the same) of any member of the Group.
"Interest" means:
(a) interest and amounts in the nature of interest accrued;
(b) prepayment penalties or premiums incurred in repaying or
prepaying any Borrowings;
(c) discount fees and acceptance fees payable or deducted in
respect of any Borrowings (and/or all fees payable in
connection with any letter of credit or guarantee); and
(d) any other costs, expenses and deductions of the like
effect (including, without limitation, the interest
element of finance leases) and any net payment (or, if
appropriate in the context, receipt) under any interest
rate hedging agreement or instrument (including without
limitation under the Hedging Documents), taking into
account any premiums payable for the same and the
interest element of any net payment (plus or minus any
accrued exchange gains or losses) under any currency
hedging instrument or arrangement,
and "Interest" includes commitment, non-utilisation and annual
agency fees (including, without limitation, those payable
hereunder) but excludes front-end, management, arrangement and
participation fees with respect to any Borrowings (including,
without limitation, those payable hereunder) and any up-front
premium or front-end fee payable pursuant to any Hedging Document.
"Interest Date" means, in relation to any Advance or any overdue
amount, the last day of an Interest Period relating thereto.
"Interest Period" means, in relation to any Advance, each period
determined in accordance with Clause 11.1 and, in relation to any
overdue amount, each period determined in accordance with Clause
10.3.
"Investor" means the various companies and limited partnerships
referred to in Schedule II of the Subscription Agreement.
"Investors Capex Contribution Amount" means a subscription by the
Investors in cash for additional shares in the capital of the
Company in each of the first four annual Accounting Periods of the
Group in an amount of (i) (pound)5,000,000 on the Closing Date
(being in addition to the amount of the Equity Subscription
referred to in Clause 4.1(b)), (ii) (pound)5,000,000 on or before
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇, (▇▇▇) (pound)5,000,000 on or before 31st
January, 2000 and (iv) (pound)5,000,000 on or before 31st January,
2001.
"IRC" means the United States Internal Revenue Code of 1986 as
amended from time to time or any successor statute thereto and any
regulations promulgated thereunder.
"Joint Venture" means any joint venture entity, whether a company,
unincorporated firm, undertaking, association, joint venture or
partnership in which any member of the Group has an interest from
time to time.
"Joint Venture Investment" has the meaning given to it in Clause
21.34.
"▇▇▇▇▇ Air Force Base Joint Venture" means any special purpose
limited liability entity in which any member of the Group has an
interest established to tender for work at the ▇▇▇▇▇ Air Force Base
in the United States of America.
"Key Man Policies" means key man life assurance policies taken out
or to be taken out by the Company and maintained by the Company in
respect of the death or disability of each of the Executives listed
below on such terms and with such insurers as the Facility Agent
may reasonably require or approve, and in the following amounts for
each Executive:
Executive Amount ((pound))
▇▇▇▇▇▇ ▇. Hamaberg 500,000
▇▇▇▇▇ ▇▇▇▇▇ 500,000
"Key Properties" means each of the freehold and leasehold
properties owned by members of the Target Group at Coventry,
Shepshed and Bagworth, as identified in the Debenture.
"LC Bank" means The Fuji Bank, Limited and/or any Affiliate of it
or any other bank which becomes the LC Bank pursuant to Clause 5.9.
"Lender" means each bank, trust or other financial institution or
Affiliate of such bank, trust or financial institution whose name
is set out in Schedule 2 or to which rights and/or obligations
under this Agreement are assigned or transferred pursuant to Clause
30 or which assumes rights and obligations pursuant to a Transfer
Agreement, and any successor or successors in title to any of the
foregoing, PROVIDED THAT upon (i) termination in full of all the
Commitments of any such bank, trust or financial institution or
Affiliate of such bank, trust or financial institution, and (ii)
irrevocable payment in full of all amounts which may be or become
payable to such bank, trust or financial institution or Affiliate
of such bank, trust or financial institution under the Senior
Finance Documents, such bank, trust or financial institution or
Affiliate of such bank, trust or financial institution shall not be
regarded as being a Lender for the purposes of determining whether
any provision of any of the Senior Finance Documents requiring
consultation with or the consent or approval of or instructions
from the Lenders or the Majority Lenders has been complied with.
"LIBOR" in relation to any Advance or overdue amount for any
Interest Period relative thereto, means:
(a) the annual rate of interest which appears on:
(i) in the case of an Advance or overdue amount
denominated in Sterling or Dollars Telerate
page 3750;
(ii) in the case of an Advance or overdue amount
denominated in an Optional Currency (other than
Dollars or Canadian Dollars) Telerate page
3740; and
(iii) in the case of an Advance or overdue amount
denominated in Canadian Dollars, the Bankers
Acceptance Rate on Telerate page 3197,
or any equivalent successor to such page, as appropriate,
(the "Telerate Screen") as determined by the Facility
Agent at or about 11.00 a.m. (London time) on the first
day of such Interest Period (in the case of an Advance
denominated in Sterling) or two Business Days before the
commencement of such Interest Period (in the case of an
Advance denominated in an Optional Currency), as being
the interest rate offered in the London Interbank Market
for the offering of deposits in the currency of such
Advance for a period comparable to such Interest Period;
and
(b) (if the relevant rate does not appear on the Telerate
Screen for the purposes of paragraph (a) or the Facility
Agent determines that no rate for a period of comparable
duration to the relevant Interest Period appears on the
Telerate Screen) the arithmetic mean (rounded upward to
four decimal places) of the rates supplied to the
Facility Agent at its request, quoted by the Reference
Banks to leading banks in the London Interbank Market at
or about 11.00 a.m. (London time) on the first day of
such Interest Period (in the case of an Advance
denominated in Sterling) or two Business Days before the
commencement of such Interest Period (in the case of an
Advance denominated in an Optional Currency) for the
offering of deposits in the currency of such Advance for
a period comparable to its Interest Period, provided that
if any of the Reference Banks fails to supply such
offered rate to the Facility Agent by 1.00 p.m. (London
time) on the required date, "LIBOR" for the relevant
Interest Period shall be determined on the basis of the
quotations of the remaining Reference Banks.
"Majority Lenders" means, at any time, Lenders the aggregate of
whose Commitments:
(a) represent by value at least 66 2/3 per cent. of the Total
Commitments; or
(b) if the Total Commitments have been reduced to zero,
represented by value at least 66 2/3 per cent. of the
Total Commitments immediately before the reduction,
provided that Clause 2.2(k) shall be ignored for the purposes of
this definition.
"Managers" means those individuals who are to subscribe for shares
in the capital of the Company at Closing who are identified in
schedule I of the Shareholders Agreement.
"Margin" means:
(a) in respect of any Tranche A Advance or Tranche D
Utilisation, one point seven five zero per cent. (1.750%)
per annum, save as adjusted pursuant to Clause 10.4;
(b) in respect of any Tranche B Advance, two point two five
zero per cent. (2.250%) per annum; and
(c) in respect of any Tranche C Advance or Tranche E
Utilisation, two point five zero per cent. (2.50%) per
annum.
"Material Adverse Effect" means any effect which is, or is
reasonably likely to (i) be, materially adverse to the business,
assets or financial condition of the Company, any Operating
Division or of the Group taken as a whole, or (ii) be materially
adverse to the ability of any Obligor (taking into account those
sources of finance shown to be available to it including from
within the Group at the relevant time which are both lawful and
permitted by the terms of this Agreement) to comply with its
payment obligations under the Senior Finance Documents or its
obligations under Clause 22.2 or (iii) result in any of this
Agreement, the Bridge Facility Agreement, the Subordinated Facility
Agreement or the Sale and Purchase Agreements not being legal,
valid and binding on and enforceable substantially in accordance
with their material terms against any party thereto or materially
and adversely affect the value of the security (taken as a whole)
provided pursuant to the Security Documents.
"Material Group Subsidiary" means each member of the Group (i)
whose pre-tax profits represent five per cent. or any greater
percentage of the Consolidated EBIT of the Group, or (ii) the book
value of whose gross assets is five per cent. or more of the
consolidated gross assets of the Group, in either case determined
in accordance with the Applicable Accounting Principles or (iii)
whose aggregate sales to third parties in any annual Accounting
Period, calculated on a consolidated basis in accordance with the
Applicable Accounting Principles and excluding VAT and/or sales
tax, are at least five per cent. or more of the aggregate sales of
the Group to third parties (similarly calculated), and for this
purpose:
(A) in the case of a company which itself has Subsidiaries,
the calculation shall be made by using the consolidated
pre-tax profits or gross assets or aggregate sales, as
the case may be, of it and its Subsidiaries;
(B) the calculation of consolidated pre-tax profits or gross
assets or aggregate sales shall be made by reference to:
(I) the latest accounts of the relevant company
(or, as the case may be, a consolidation of the
accounts of it and its Subsidiaries) used for
the purpose of the then latest unaudited
quarterly or audited annual consolidated
Accounts of the Group delivered to the Facility
Agent under Clause 21.2; and
(II) those unaudited quarterly or audited annual
consolidated Accounts (as the case may be) of
the Group;
(C) each member of the Group named in Schedule 4 or, if
later, in the latest annual list of Material Group
Subsidiaries provided by the Company to the Facility
Agent pursuant to Clause 21.2(d)(i)(B) shall be deemed to
be a Material Group Subsidiary until either the next list
of Material Group Subsidiaries is delivered to the
Facility Agent pursuant to Clause 21.2(d)(i)(B) or it is
shown to the Facility Agent's reasonable satisfaction not
to be a Material Group Subsidiary under paragraph (B)
above; and
(D) any member of the Group which is not a Material Group
Subsidiary to which any Material Group Subsidiary
transfers in any annual Accounting Period any fixed
assets in any transaction or series of transactions
(related or not) with an aggregate book value or market
value in excess of (pound)10,000,000 shall be deemed to
be a Material Group Subsidiary (and the Material Group
Subsidiary from which the assets were transferred shall
be deemed to continue to be a Material Group Subsidiary)
unless and until it is shown (in each such case) to the
Facility Agent's reasonable satisfaction not to be a
Material Group Subsidiary under paragraph (B) above.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
defined in section 3(37) or 4001(a)(3) of ERISA.
"Net Proceeds" means:
(a) the consideration received by any member of the Group in
respect of the disposal to any person who is not a member
of the Group of all or any part of its business,
undertaking or assets (including the amount of any
intercompany debt repaid to continuing members of the
Group), net of all Taxes applicable on, or to any gain
resulting from, the disposal and of all third party
costs, fees and expenses properly incurred by members of
the Group in arranging and effecting that disposal;
and/or
(b) the proceeds of any claim:
(i) against any of the Vendors under the
Acquisition Agreements (including, without
limitation, any adjustment to the purchase
price), but after deduction of all Taxes
applicable on, and all third party costs, fees
and expenses properly incurred in connection
with, such claim; and/or
(ii) for loss or destruction of or damage to
property of a member of the Group made by a
member of the Group under any insurance policy
(excluding the proceeds of any claim for loss
of profits or business interruption),
in each case, save where the claim is for the
reimbursement or payment on account of monies lawfully
and properly disbursed or to be disbursed (including for
the reinstatement of or the purchase of replacement
assets) and/or payments or liabilities lawfully and
properly made or incurred or to be made or incurred by
any member of the Group, in which case the proceeds shall
only be taken into account for the purposes of this
definition if (and to the extent that) (A) they exceed
the amount of the monies and/or payments or liabilities
actually so disbursed and/or made or incurred and/or (B)
such monies or payments are not so disbursed or made
within 12 months of the date of receipt of the proceeds
of any such claim.
"Newcos" means each of the Company, Dunlop Standard Aerospace
Holdings Limited, Holdco, Dunlop Standard Aerospace Overseas
Limited, ▇▇▇▇▇ Aviation Limited, Dunlop Standard Aerospace (US)
Inc., Dunlop Investments, Canadaco and Dutchco.
"Novation Agreement" has the meaning given to it in Clause 30.3.
"Obligor" means a Borrower or a Guarantor.
"Obligors' Agent" means the Company appointed to act on behalf of
each Obligor pursuant to Clause 2.4.
"Operating Division" means each of:
(i) the Standard Aero Division;
(ii) the Dunlop Aviation Division; and
(iii) the Aero Engine Equipment Division.
"Operating Division Heads" means each of the Executives (other than
the Chief Executive Officer and the Chief Financial Officer) at the
date of this Agreement and each other person from time to time
notified by the Company to the Facility Agent as managing any of
the Operating Divisions.
"Optional Currency" means any currency other than Sterling which is
readily available and freely transferable in the London Foreign
Exchange Market in sufficient amounts to fund the relevant Advance.
"Original Sterling Amount" means in relation to any amount:
(a) (if denominated in Sterling) the principal amount which
is, or is to be, outstanding, drawn or issued; or
(b) (if denominated in an Optional Currency) the Sterling
Equivalent of the principal amount which is, or is to be,
outstanding, drawn or issued calculated, in the case of
an Advance, two Business Days prior to the Utilisation
Date for that Utilisation and in the case of a
Documentary Credit, on the Utilisation Date for that
Utilisation.
"Original Investors" means ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Limited (or funds
managed by it).
"Outstanding Liability Amount" in relation to any Documentary
Credit at any time means the maximum amount for which the LC Bank
or the Lenders, as the case may be, could be actually and/or
contingently liable thereunder less the aggregate of (i) all
amounts thereof repaid or prepaid hereunder and (ii) all amounts
(if any) paid out by the LC Bank (or the Lenders) thereunder for
which the LC Bank and/or the Lenders have been reimbursed by the
Obligors (whether or not out of the proceeds of a Tranche D
Advance).
"Party" means a party to this Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a Plan that is subject to Title IV of ERISA.
"Plan" means an "employee benefit plan" within the meaning of
Section 3(3) of ERISA and which is subject to ERISA with respect to
which any U.S. Obligor, any Subsidiary of a U.S. Obligor or any
ERISA Affiliate may have any liability (other than a Multiemployer
Plan).
"Priority Agreement" means the priority agreement dated on or about
the Signing Date between the Company, the Borrowers and Guarantors,
the Agents, the Lenders, the Hedging Banks, the Subordinated
Lenders, the Subordinated Agent and the Intercompany Creditors and
Intercompany Debtors (each as defined therein).
"Proforma Accounts" means the form of monthly and quarterly
consolidated management Accounts of the Group in the format and
with the headings and level of information agreed by the Company
and the Facility Agent from time to time (or if not so agreed as
reasonably required by the Facility Agent).
"Recognised Lender" means, a bank, trust or other financial
institution which is:
(a) in respect of a Utilisation made available to a Borrower
whose jurisdiction of incorporation is in or part of the
United Kingdom:
(i) a bank as defined in Section 840A of the Income
and Corporation Taxes Act 1988 (or any
statutory re-enactment or modification thereof)
which is within the charge to United Kingdom
corporation tax as regards interest payable or
paid to it under this Agreement; or
(ii) if at any time Section 349 or Section 840A of
the Income and Corporation Taxes Act 1988 (or
any statutory re-enactment or modification
thereof, in substantially the same form and
context as at the date hereof) shall not at any
time continue in full force and effect, is a
bank carrying on through its Facility Office a
bona fide banking business in the United
Kingdom which is within the charge to United
Kingdom corporation tax as regards any interest
payable or paid to it under this Agreement; or
(iii) in respect of a bank, trust or other financial
institution making an Advance under the Tranche
B Facility, Tranche C Facility or Tranche E
Facility only, at the time the bank, trust or
other financial institution becomes a party to
this Agreement, is resident in a country with
which the United Kingdom has an appropriate
double taxation treaty and such treaty provides
at the date hereof (or in the case of a
transferee under Clause 30, at the date of
transfer) under its terms for full relief from
United Kingdom income Tax on interest for an
entity such as the bank, trust or other
financial institution or its transferee when
acting through the office or any branch,
Affiliate or agency through which it is acting
for the purposes of this Agreement; or
(b) in respect of Utilisations made available to a Borrower
whose jurisdiction of incorporation is other than in the
United Kingdom:
(i) for the time being lending through a
branch, Affiliate or agency in the
jurisdiction of incorporation of
such Borrower; or
(ii) (A) lending through any other
branch, Affiliate or agency if, at
the time the bank, trust or
financial institution becomes a
party to this Agreement, it is
resident in a country with which the
jurisdiction of incorporation of
such Borrower has an appropriate
double taxation treaty which
provides at the date hereof (or in
the case of a transferee under
Clause 30, at the date of transfer)
under its terms for full relief from
that jurisdiction's income Tax on
that jurisdictions' source interest
for an entity such as such bank,
trust or other financial institution
when acting through the branch,
Affiliate or agency through which it
is acting; and
(B) prior to the first Interest Date
after the date on which such Lender
became a party to this Agreement on
which any interest on any of the
Advances to such Borrower in which
such Lender has a participation is
payable, has made and filed an
appropriate application for relief
under such treaty (or would have
done so but for any failure by such
Borrower to comply with its
obligations under Clause 13.5); or
(iii) in respect of Utilisations made available to a
Borrower resident in Canada, for the time being
lending through its Facility Office or though
any branch, Affiliate or agency used for the
purposes of making Utilisations to any other
Borrower under this Agreement.
"Reference Banks" means the principal London offices of The Fuji
Bank, Limited and of such other Lenders as may become Reference
Banks pursuant to Clause 30.4.
"Re-organisation" means those aspects of the Target Group
re-organisation expressed to occur on or after the Closing Date as
described in the Structure Memorandum (including, without
limitation, the Canadian Re-organisation, the transfer of Dunlop
Standard Aerospace US Inc. to Dunlop Aerospace Limited and the
transfer of some or all of Dunlop Investment's interests in BTR
Aerospace B.V. and Vliegwiel B.V. to Dutchco).
"Repayment Date" means a Tranche A Repayment Date, a Tranche B
Repayment Date, a Tranche C Repayment Date or a Tranche E Repayment
Date or such of them as the context requires.
"Repayment Instalment" means a Tranche A Repayment Instalment (as
defined in Clause 8.1), a Tranche B Repayment Instalment (as
defined in Clause 8.2), a Tranche C Repayment Instalment (as
defined in Clause 8.3) or a Tranche E Repayment Instalment (as
defined in Clause 8.5) or such of them as the context requires.
"Reportable Event" means a "reportable event" described in Section
4043 of ERISA (other than a "reportable event" not subject to the
provision for 30-day notice to the PBGC and other than a reportable
event described in Section 4043(c)(9) to (12) of ERISA).
"Reports" means each of:
(a) the Accountants' Report;
(b) the legal due diligence report dated on or before the
Signing Date prepared by, amongst others, ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇;
(c) the industry and market report dated on or before the
Signing Date prepared by Canaan Group Limited;
(d) the environmental report dated on or before the Signing
Date prepared by Dames & ▇▇▇▇▇; and
(e) the insurance due diligence investigation dated 16th
July, 1998 prepared by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (the "Insurance
Report"),
in each case either addressed to the Agents and the Lenders or the
subject of a separate reliance letter confirming that the Agents
and the Lenders are entitled to rely on such report.
"Request" means a request made by a Borrower or by the Obligors'
Agent on behalf of a Borrower for a Utilisation, substantially in
the form of Schedule 5.
"Reservations" means the principle that equitable remedies are
remedies which may be granted or refused at the discretion of the
court, 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 the
Limitation Acts, the possibility that a court may strike out
provisions of a contract as being invalid for reasons of
oppression, undue influence, (in the case of default interest)
representing a penalty or similar reasons and any other
reservations or qualifications of law (but not of fact) expressed
in any of the legal opinions issued pursuant to Schedule 3, Part I,
paragraphs 15 and 22.
"Sale and Purchase Agreements" means:
(i) the share and business sale and purchase agreement
between certain of the Vendors, the Company and certain
of its Subsidiaries dated on or before the Signing Date
providing, inter alia, for the sale by BTR International
Limited (or certain of its Affiliates) and the purchase
by the Company and certain of such Subsidiaries of Dunlop
Holdings Limited, BTR Canada Inc, BTR Aerospace B.V., BTR
Vliegwiel B.V., Standard Aero (Asia) Pte Limited, Dunlop
Aviation (SE Asia) Pte Limited and Standard Aero
International Pty Limited (the "UK Sale and Purchase
Agreement"); and
(ii) the agreement between certain of the Vendors, the Company
and certain of its subsidiaries dated on or before the
Signing Date providing, inter alia, for the sale by BTR
International Limited (or certain of its Affiliates) and
the purchase by the Company and certain of such
Subsidiaries of Standard Aero Inc., ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ South
Wind Corporation and Dunlop Aviation North America Inc.
(the "US Sale and Purchase Agreement").
"Security Costs" means all fees, costs, expenses, stamp,
registration and capital taxes incurred by the Company (or any
other member of the Group) in connection with the execution and
registration of the Security Documents.
"Security Documents" means the share charges and other security
documents identified in Schedule 7, together with such other
security documents as may be required to be entered into by any
Obligor pursuant to any of the Finance Documents.
"Service Contracts" means the contracts of service made between
each of the Executives and the Company.
"Shareholders Agreement" means the investment agreement dated on or
before the Signing Date made between the Company, the Investors and
the Managers pursuant to which the Investors and Managers agree to
subscribe for and have issued to them shares in the Company.
"Shares" means each and any of the shares in the capital of the
Company.
"Signing Date" means the date of this Agreement.
"Standard Aero Division" means the engine repair and overhaul
businesses carried on by BTR Aerospace B.V., BTR Vliegwiel B.V.,
Standard Aero VoF., Standard Aero (Australia) Pty Limited, Standard
Aero (International) Pty Limited, Standard Aero Inc., Standard Aero
(Alliance) Inc., Standard Aero (San Antonio) Inc., Standard Aero de
Mexico S.A. de C.V., BTR Canada Inc., Standard Aero Limited, Fasco
Motors Limited and Standard Aero (Asia) Pte Limited from time to
time.
"Sterling" and "(pound)" means the lawful currency for the time
being of the United Kingdom.
"Sterling Equivalent" means, in relation to an amount expressed or
denominated in an Optional Currency, the equivalent thereof in
Sterling converted at the Agent's Spot Rate of Exchange on the date
of the relevant calculation (and if used in relation to an amount
expressed or denominated in Sterling, such amount).
"Structure Memorandum" means the memorandum and chart in the agreed
form delivered to the Facility Agent on the date of this Agreement
prepared by PricewaterhouseCoopers setting out the legal and
beneficial capital and share ownership of members of the Group (and
giving details of any minority shareholdings in any Subsidiary) and
all material intercompany loans between any members of the Group
and identifying all interests of members of the Group in other
companies and partnerships all as of and immediately after Closing
and showing all reorganisational steps with respect to members of
the Group to be taken at or shortly after Closing, as supplemented
by the Supplemental Structure Memorandum.
"Subordinated Borrower" means Dunlop Standard Aerospace Holdings
Limited or a US incorporated corporation which is a direct
Subsidiary of the Company.
"Subordinated Documents" means the Subordinated Facility Agreement,
any related fee letters, the Substitution Certificates, any
Novation Agreement and Guarantor Accession Agreement (each as
defined in the Subordinated Facility Agreement), the Security
Documents and the Priority Agreement.
"Subordinated Facility Agreement" means a subordinated facility
agreement between, amongst others, the Subordinated Borrower,
certain banks and financial institutions as lenders and the
Subordinated Agent.
"Subordinated Lenders" means the Lenders under the Bridge Facility
Agreement or the Subordinated Facility Agreement as the context
requires.
"Subsidiary" means in relation to any person, any entity which is
controlled directly or indirectly by that person or of whose
dividends or distributions that person is entitled to receive more
than 50 per cent. and any entity (whether or not so controlled)
treated as a subsidiary in the latest financial statements of that
person from time to time, and "control" for this purpose means the
direct or indirect ownership of the majority of the voting share
capital of such entity or the right or ability to direct management
to comply with the type of material restrictions and obligations
contemplated in this Agreement or to determine the composition of a
majority of the board of directors (or like board) of such entity,
in each case whether by virtue of ownership of share capital,
contract or otherwise.
"Substitution Certificate" means a duly completed certificate
substantially in the form of Part I of Schedule 6.
"Supplemental Structure Memorandum" means the memorandum and chart
in agreed form prepared by PricewaterhouseCoopers which supplements
the Structure Memorandum.
"Targets" means each of Dunlop Holdings Limited, Dunlop Aviation
North America Inc., Standard Aero Inc, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ South Wind
Corporation, BTR Canada Inc, Standard Aero (Asia) PTE Limited,
Dunlop Aviation (SE Asia) PTE Limited, Standard Aero (Australia)
PTY Ltd, BTR Aerospace B.V., BTR Vliegwiel B.V. and the ▇▇▇▇▇
Business (as defined in the UK Sale and Purchase Agreement) (each a
"Target").
"Target Group" means the Targets (including without limitation, the
▇▇▇▇▇ Business) and their respective Subsidiaries.
"Taxes" means all taxes, imposts, duties, levies, charges,
deductions and withholdings in the nature or on account of tax,
together with all interest thereon and penalties with respect
thereto and "Tax" shall be construed accordingly.
"Term Advances" means the Tranche A Advances, the Tranche B
Advances, the Tranche C Advances and the Tranche E Advances.
"Total Purchase Price" has the meaning given to that term in Clause
21.15.
"Tranche A Repayment Date" means each date identified in Clause
8.1.
"Tranche B Repayment Date" means each date identified in Clause
8.2.
"Tranche C Repayment Date" means each date identified in Clause
8.3.
"Tranche E Repayment Date" means each date identified in Clause
8.5.
"Transaction Documents" means the Finance Documents, the
Acquisition Agreements, the Shareholders Agreement and the Service
Contracts.
"Transfer Agreement" means a Novation Agreement or a Substitution
Certificate.
"U.S. Obligor" means each Obligor incorporated in the United States
of America (or any of its states or territories or any political or
legal sub-division thereof).
"U.S. Person" means a person who is a citizen or resident of the
United States of America and any corporation or other entity
created or organised in or under the laws of the United States of
America or any political or legal sub-division thereof.
"Utilisation" means a utilisation under this Agreement of the
Tranche A Facility (a "Tranche A Utilisation") and/or a utilisation
under this Agreement of the Tranche B Facility (a "Tranche B
Utilisation") and/or a utilisation under this Agreement of the
Tranche C Facility (a "Tranche C Utilisation") and/or a utilisation
under this Agreement of the Tranche D Facility (a "Tranche D
Utilisation") and/or a utilisation under this Agreement of the
Tranche E Facility (a "Tranche E Utilisation") or such of them as
the context requires.
"Utilisation Date" means in relation to each Utilisation, the date
specified as such in the relative Request or, on and after the
making and/or issue thereof pursuant to such Request, the date on
which it was made and/or issued.
"Vendors" means BTR International Limited (and certain of its
Affiliates) named as the vendors' guarantor or a vendor in any of
the Sale and Purchase Agreements.
"Withholding Period" means in relation to a Tranche B Advance,
Tranche C Advance or a Tranche E Advance made available to a
Borrower resident in Canada, the period beginning on the date of
Utilisation of such Tranche B Advance, Tranche C Advance or Tranche
E Advance and ending on the date five years and one day from the
date of the last such Utilisation.
1.2 Construction
(a) In this Agreement, unless the contrary intention appears, a
reference to:
(i) "assets" includes properties, revenues and rights of
every description present, future and contingent;
an "authorisation" includes an authorisation, consent,
approval, resolution, licence, exemption, filing,
registration and notarisation;
a "month" is a reference to a period starting on one day
in a calendar month and ending on the numerically
corresponding day in the next calendar month, except
that, if such period starts on the last day in a calendar
month or there is no numerically corresponding day in the
month in which that period ends, that period shall end on
the last Business Day in such later calendar month;
a "regulation" includes any regulation, rule, order,
official directive, request or guideline (whether or not
having the force of law) of any governmental body,
agency, department or regulatory, self-regulatory or
other authority or organisation;
(ii) a provision of a law is a reference to that provision as
amended or re-enacted;
(iii) a Clause or a Schedule is, unless otherwise specified, a
reference to a clause of or a schedule to this Agreement;
(iv) a Transaction Document or any other document is a
reference to that Transaction Document or that other
document as amended, novated or supplemented from time to
time (including, where relevant by any Borrower Accession
Agreement, Guarantor Accession Agreement and/or Transfer
Agreement);
(v) a time of day is a reference to London time and a
reference to close of business is to close of business in
London;
(vi) words importing the singular shall include the plural and
vice versa;
(vii) a document in an "agreed form", is a reference to such
document either in a form previously agreed in writing by
or on behalf of the Company and the Facility Agent or
otherwise in form and substance satisfactory to the
Lenders acting reasonably;
(viii) an outstanding Documentary Credit is "repaid" or
"prepaid" by providing (in accordance with the terms
hereof) cash cover therefor in the same currency as that
in which such Documentary Credit is denominated or
expressed to be payable, by reducing (in accordance with
the terms hereof) the Outstanding Liability Amount of
such Documentary Credit or by cancelling such Documentary
Credit and returning the original to the LC Bank or the
Facility Agent on behalf of the Lenders or providing
other evidence (in form and substance satisfactory to the
LC Bank or, as the case may be, Facility Agent) that no
further liability exists thereunder; references to
Utilisations being repaid or prepaid are to be construed
accordingly insofar as those Utilisations involve
Documentary Credits;
(ix) an amount "outstanding" at any time under or in respect
of a Documentary Credit (or the "principal amount"
thereof at any time) is the Outstanding Liability Amount
of such Documentary Credit and a "drawing" under the
Tranche D Facility includes the issue of a Documentary
Credit and each provision of this Agreement which
contains reference to the concepts contained in this
paragraph (ix) shall be construed accordingly;
(x) where the LC Bank is also a Lender (the "Indemnifying
Lender") which has a Tranche D Commitment then the LC
Bank in its capacity as such shall be treated as a
separate entity from such Indemnifying Lender and for all
the purposes of the Finance Documents the Indemnifying
Lender shall be treated as having a liability to the LC
Bank under Clause 5.7 in respect of Documentary Credits
issued by the LC Bank;
(xi) any reference to a Party or other person includes, unless
otherwise provided in this Agreement, such Party's or
person's permitted successors, assigns, transferees or
substitutes; and
(xii) reference to the "equivalent in other currencies" or like
terms shall, unless otherwise agreed or the context
otherwise requires, mean the Sterling Equivalent of the
relevant amount in other currencies.
(b) Unless the contrary intention appears, a term used in any other
Finance Document or in any notice given under or in connection with
any Finance Document has the same meaning in that Finance Document
or notice as in this Agreement.
(c) The index to and the headings in this Agreement are for convenience
only and are to be ignored in construing this Agreement.
(d) Without prejudice to any action already taken by the Facility Agent
or any of the Lenders under Clause 23.2 or the Security Documents
an Event of Default relating to a breach of a financial covenant
contained in Clause 22.2 shall not be treated as subsisting from
the time that any annual or quarterly consolidated Accounts of the
Group are subsequently delivered to the Facility Agent under Clause
21.2 establishing compliance with that financial covenant as at any
subsequent test date together with any related certificates
delivered pursuant to Clause 21.2(d).
(e) Where any representation or warranty contained in Clause 20 is
qualified by the expression "to its knowledge" or any similar
expression:
(i) the relevant representation and warranty shall be deemed
to include an additional statement that it has been made
after reasonable enquiry of the Executives up to the date
of the making or repetition of such representation and
warranty; and
(ii) such representation or warranty shall be given by the
Company only and the knowledge of the Company shall be
deemed to be limited to the knowledge of the Executives,
the Operating Division Heads and ▇▇▇ ▇▇▇▇▇.
(f) Where the Company is, under any provision of this Agreement, either
obliged to make a payment or procure that another member of the
Group makes the payment, the Company shall only procure that
another member of the Group makes such payment where such other
member of the Group would not be in breach of any financial
assistance or other applicable law if it made such payment,
provided always that despite any such prohibition or illegality
affecting any of its Subsidiaries the Company shall remain liable
to make any such payment.
2. THE FACILITies
2.1 Facilities
Subject to the terms of this Agreement, the Lenders grant:
(a) Tranche A Facility: A term loan facility under which the
Lenders shall, when requested by the Obligors' Agent
pursuant to a Request, make to Dunlop Aerospace Limited
and Dunlop Standard Aerospace (UK) Limited or such other
company as the Lenders may agree up to 5 Tranche A
Advances denominated in Sterling, Dollars, Canadian
Dollars or Guilders in an aggregate Original Sterling
Amount equal to the Tranche A Commitments;
(b) Tranche B Facility: A term loan facility under which the
Lenders shall, when requested by the Obligors' Agent
pursuant to a Request, make to Dunlop Standard Aerospace
(US) Inc. and/or Canadaco up to 2 Tranche B Advances
denominated in Dollars or Canadian Dollars in an
aggregate Original Sterling Amount equal to the Tranche B
Commitments;
(c) Tranche C Facility: A term loan facility under which the
Lenders shall, when requested by the Obligors' Agent
pursuant to a Request, make to Dunlop Standard Aerospace
(US) Inc. and/or Canadaco and/or Dunlop Aerospace Limited
up to 2 Tranche C Advances in Dollars in an aggregate
Original Sterling Amount equal to the Tranche C
Commitments;
(d) Tranche D Facility: A revolving credit facility under
which the Lenders shall, when requested by the Obligors'
Agent pursuant to a Request, make to the relevant
Borrower, Tranche D Advances or issue, or procure the LC
Bank to issue for the account of such Borrower,
Documentary Credits denominated in Sterling and/or an
Optional Currency or Optional Currencies up to an
aggregate Original Sterling Amount outstanding at any
time which does not exceed the Tranche D Commitments;
(e) Tranche E Facility: A term loan and Documentary Credit
facility under which the Lenders shall, when requested by
the Obligors' Agent pursuant to a Request, make to the
relevant Borrower Tranche E Advances or issue to the
account of such Borrower, syndicated Documentary Credits
denominated in Sterling or an Optional Currency. The
aggregate Original Sterling Amount of all Tranche E
Utilisations shall not exceed the Tranche E Commitments.
No more than ▇▇ ▇▇▇▇▇▇▇ ▇ Utilisations may be outstanding
at any time; and
(f) Ancillary Facilities: Ancillary facilities under which an
Ancillary Bank may provide to certain Borrowers:
(i) overdraft, cheque drawing and other current
account facilities;
(ii) forward foreign exchange facilities;
(iii) guarantee, bonding, documentary or stand-by
letter of credit facilities; and/or
(iv) such other facilities or financial
accommodation as the relevant Ancillary Bank
may agree.
2.2 Limitations
(a) The Tranche A Commitments, the Tranche B Commitments and the
Tranche C Commitments must be fully drawn down at Closing.
(b) The first drawdown shall comprise:
(i) no more than five Tranche A Advances each with an
Interest Period of 1 month;
(ii) no more than two Tranche B Advances each with an Interest
Period of 1 month; and
(iii) no more than four Tranche C Advances each with an
Interest Period of 1 month.
(c) No Tranche D Utilisation may be made unless and until the Tranche A
Advances and the Tranche B Advances and the Tranche C Advances have
been, or are on the same Utilisation Date being, made.
(d) No more than 20 Tranche D Utilisations may be outstanding at any
time.
(e) No more than ▇▇ ▇▇▇▇▇▇▇ ▇ Utilisations may be outstanding at any
time.
(f) No amount may be drawn under the Tranche D Facility if the Sterling
Equivalent of such proposed Tranche D Utilisation together with the
aggregate of the Original Sterling Amount of the outstanding
Tranche D Utilisations and all outstanding third party Borrowings
permitted by Clause 21.10(f) would exceed the total Tranche D
Commitments at such time.
(g) the Original Sterling Amount of the Tranche A Advances denominated
in Dollars, Canadian Dollars or Guilders (if any) shall not exceed
the amounts of the Tranche A Facility specified in the Structure
Memorandum as being drawn down in those currencies unless otherwise
agreed in writing by the Facility Agent.
(h) Canadaco and BTR Canada Inc may not borrow any amount under the
Tranche A Facility.
(i) The Borrowers of the Tranche A Advances, the Tranche B Advances and
the Tranche C Advances will be those Borrowers identified in the
Structure Memorandum. To the extent that immediately prior to
Closing Dunlop Aerospace Limited had outstanding Borrowings
(whether owed to the Vendors or otherwise), Dunlop Aerospace
Limited will borrow an amount of the Tranche A Advances equal to
the amount of such outstanding Borrowings.
(j) The Tranche D Commitment of each Ancillary Bank shall be reduced by
the amount of its Ancillary Commitment but shall automatically
increase upon any amount of its Ancillary Commitment being
cancelled or otherwise ceasing to be available to the relevant
Borrower.
(k) The aggregate of the Original Sterling Amount of the Tranche D
Utilisations and the Ancillary Outstandings at any time may not
exceed the Tranche D Commitments then in effect, (ignoring for this
purpose the effect of Clause 2.2(j)).
(l) The Tranche E Facility may not be drawn down by way of Advance by
any Borrower incorporated in Canada after the second day prior to
the third anniversary of Closing.
(m) The Obligors shall procure that, to the extent that they are able
to do so having regard to the currencies in which the Target Group
generates its cashflow, Tranche B shall be denominated in Dollars
and borrowed by a U.S. Obligor.
2.3 Nature of a Finance Party's rights and obligations
(a) No Lender is obliged to participate in the making of any
Utilisation (i) in the case of a Tranche A Advance or a
Tranche B Advance or a Tranche C Advance if the aggregate
Original Sterling Amount of its participation in all such
Tranche A Advances, Tranche B Advances, Tranche C
Advances would exceed its Commitment bearing the same
designation, or (ii) in the case of a Tranche D
Utilisation or a Tranche E Utilisation, if to do so would
cause the aggregate of the Original Sterling Amount of
its participation in the Tranche D Utilisations or the
Tranche E Utilisations outstanding under this Agreement
at such time to exceed its Tranche D Commitment or its
Tranche E Commitment, provided that for the purpose of
this Clause 2.3(a) its participation in an outstanding
Documentary Credit issued under the Tranche D Facility by
the LC Bank shall be its maximum potential liability
under Clause 5.7 in respect of such Documentary Credit.
(b) The obligations of a Finance Party under the Finance
Documents are several. Failure of a Finance Party to
carry out those obligations does not relieve any other
Party of its obligations under the Finance Documents. No
Finance Party is responsible for the obligations of any
other Finance Party under the Finance Documents.
(c) (i) The obligations of each Lender under this Agreement
in respect of each Advance to be made available by it
under this Agreement may be discharged by such Lender
procuring that an Affiliate (which is itself a party to
this Agreement) of such Lender which is named in Schedule
2 (or, as the case may be, the assignment or transfer
document or Transfer Agreement by which such Lender (and
Affiliate) became a party hereto) as being the lender of
any Advance to be made to any Borrower incorporated in a
jurisdiction specified opposite the name of such
Affiliate in Schedule 2 (or in any such transfer or
assignment document or Transfer Agreement) lends or
otherwise makes available to the relevant Borrower in
accordance with and subject to the terms of this
Agreement the amount which such Lender is obliged to lend
or so make available hereunder.
(ii) The provisions of Clause 10, 13, 14, 15, 16, 27 and 33
shall apply to any Affiliate of any Lender which is named
in Schedule 2 (or, as the case may be, such assignment or
transfer document or Transfer Agreement) and to any
Advance made by any such Affiliate as if such Affiliate
were a Lender.
(d) The rights of a Finance Party under the Finance Documents are
divided rights. A Finance Party may, except as otherwise stated in
the Finance Documents, separately enforce those rights.
2.4 Obligors' Agent
(a) Each Obligor (other than the Company) by its execution of this
Agreement (including by way of execution of a Borrower Accession
Agreement or a Guarantor Accession Agreement) irrevocably
authorises the Company to act on its behalf as its agent in
relation to the Senior Finance Documents and irrevocably authorises
(i) the Company on its behalf to supply all information concerning
itself, its financial condition and otherwise to the Lenders as
contemplated under this Agreement and to give all notices and
instructions (including, in the case of a Borrower, Requests and
notices pursuant to Clause 11.1) to be given by such Obligor under
the Senior Finance Documents (and the Finance Parties may rely on
any Requests or other notices given by the Company on behalf of
such Obligor), to execute on its behalf any Senior Finance Document
(other than Security Documents) and to enter into any agreement in
connection with the Senior Finance Documents notwithstanding that
the same may affect such Obligor, without further reference to or
the consent of such Obligor, and (ii) each Finance Party to give
any notice, demand or other communication to be given to or served
on such Obligor pursuant to the Senior Finance Documents to the
Company on its behalf, and in each such case such Obligor will be
bound thereby as though such Obligor itself had given such notice
and instructions, executed such agreement or received any such
notice, demand or other communications.
(b) Every act, omission, agreement, undertaking, settlement, waiver,
notice or other communication given or made by the Company under
this Agreement, or in connection with this Agreement (whether or
not known to any other Obligor and whether occurring before or
after such other Obligor became an Obligor under this Agreement)
shall be binding for all purposes on all other Obligors as if the
other Obligors had expressly made, given or concurred with the same
(and irrespective of whether the Company has complied with its
obligations under paragraph (c) below). In the event of any
conflict between any notices or other communications of the Company
and any other Obligor, those of the Company shall prevail.
(c) Without prejudice to the foregoing, the Company shall at all times
keep each Obligor informed of all such actions taken or notices or
instructions given by the Company on behalf of such Obligor and to
the extent practicable or desirable consult with and take
instructions from such Obligor.
2.5 Change of currency
(a) If more than one currency or currency unit are at the same time
recognised by the central bank of any country as the lawful
currency of that country, then:
(i) any reference in the Finance Documents to, and any
obligations arising under the Finance Documents in, the
currency of that country shall be translated into, or
paid in, the currency or currency unit of that country
designated by the Facility Agent; and
(ii) any translation from one currency or currency unit to
another shall be at the official rate of exchange
recognised by the central bank for the conversion of that
currency or currency unit into the other, rounded up or
down by the Facility Agent acting reasonably.
(b) If a change in any currency of a country occurs, this Agreement
will be amended to the extent the Facility Agent acting in good
faith specifies to be necessary to reflect the change in currency
and to put the Lenders in the same position, so far as possible,
that they would have been in if no change in currency had occurred.
3. PURPOSE
(a) The proceeds of the Tranche A Advances, the Tranche B Advances, and
the Tranche C Advances, shall be applied in or towards financing
payment in full of the purchase price for the Acquired Assets
payable to the Vendors at Closing under the Acquisition Agreements,
any Acquisition Costs (up to an aggregate amount not exceeding
(pound)30,000,000 (or its equivalent in other currencies) or in the
refinancing of the indebtedness of the Target Group.
(b) The proceeds of the Tranche D Utilisations shall be applied in or
towards financing the general corporate purposes of the relevant
Borrower and its Subsidiaries.
(c) The proceeds of the Tranche E Utilisations shall be applied in or
towards financing Capital Expenditure.
(d) Each Borrower undertakes that no Utilisation shall be used in any
way which would be illegal under or cause the invalidity or
unenforceability of any Finance Document under any applicable law.
(e) Without affecting the obligations of any Obligor in any way, no
Finance Party is bound to monitor or verify the application of any
Utilisation.
(f) Documentary Credits shall only be opened in favour of Approved
Banks or of persons from time to time notified by the Obligors'
Agent to the Facility Agent provided that the Majority Lenders
(through the Facility Agent) do not, prior to the issue of such
Documentary Credit, notify the Obligors' Agent that they are not
willing to open a Documentary Credit in favour of such person.
4. CONDITIONS PRECEDENT
4.1 Conditions precedent to first Utilisation
The obligations of each Finance Party to the Obligors under this
Agreement are subject to the conditions precedent that:
(a) Documents:
(i) on or prior to the Signing Date the Facility
Agent shall have received all of the documents
set out in Part I of Schedule 3 in the agreed
form, and each of the documents referred to in
Part I of Schedule 3 as being certified shall
be certified by the Obligors' Agent on behalf
of the party providing that document as being a
true, complete and up to date copy and in full
force and effect as at the date such document
is required to be delivered;
(ii) on or prior to the Closing Date the Facility
Agent shall have received all of the documents
set out in Part II of Schedule 3 in the agreed
form, and each of the documents referred to in
Part II of Schedule 3 as being certified shall
be certified by the Obligors' Agent on behalf
of the party providing that document as being a
true, complete and up to date copy and in full
force and effect as at the date such document
is required to be delivered.
(b) Equity: the Facility Agent shall be satisfied that the
Original Investors have subscribed in cash in an
aggregate amount of not less than (pound)150,000,000 (the
"Equity Subscription"), of which not less than
(pound)203,000 shall have been subscribed for by the
Executives, for Shares issued to them pursuant to the
Shareholders Agreement at Closing (and the Shares to be
subscribed at Closing pursuant to the Shareholders
Agreement have been issued to and are registered in their
respective names in the books of the Company);
(c) Subordinated Loan: the Facility Agent shall be satisfied
and shall have received such evidence as it requires to
show that the Subordinated Lenders have lent to the
Subordinated Borrower in cash an aggregate amount of not
less than (pound)125,000,000 (or its equivalent in other
currencies) pursuant to the Subordinated Finance
Documents (the "Subordinated Loan");
(d) Closing: the Facility Agent shall be satisfied that:
(i) the aggregate amount of the moneys payable in
respect of the Equity Subscription and the
Subordinated Loan have been paid into, and are
standing to the credit of, the relevant Closing
Account and the aggregate amount of those
moneys and the proceeds of the Tranche A
Advances, the Tranche B Advances and the
Tranche C Advances, are at least equal to the
aggregate of the amount required to be paid by
the Company and its Subsidiaries to the Vendors
at Closing pursuant to the Acquisition
Agreements and the Acquisition Costs and the
amount to be paid to any third party to pay off
any Borrowings of members of the Target Group
being repaid at Closing;
(ii) the obligations of all the parties to the
Transaction Documents (other than under the
Service Contracts) are unconditional and the
conditions to completion in each of the Sale
and Purchase Agreements has been satisfied,
save to the extent that any of those
obligations are conditional upon the making of
a Utilisation or Utilisations under this
Agreement;
(iii) the conditions set out in Clause 4.1 of the UK
Sale and Purchase Agreement and the conditions
set out in Clause 4.1 of the US Sale and
Purchase Agreement have been satisfied; and
(e) Availability: unless otherwise agreed in writing by the
Lenders the Closing Date must occur by no later than the
date 3 months after the Signing Date.
4.2 Further conditions precedent to first Utilisation
The obligations of the Finance Parties to participate in the
Utilisations to be made on the first Utilisation Date are in
addition to the conditions set out in Clause 4.1 subject only to
the further condition precedent that both at the date of the
Request for such Utilisation and at the Utilisation Date therefor:
(a) the representations and warranties in Clauses 20.1(a),
(b), (c), (d), (e), (f), (l), (p) and (r) are correct and
will be correct immediately after the first Utilisation
is made in respect of each Newco and each Borrower (save
in the case of the representation and warranty in Clause
20.1(e) only for Dunlop Aerospace Limited and BTR Canada
Inc.) and the representation and warranty in Clause
20.1(q) is correct and will be correct in all material
respects immediately after the first Utilisation is made;
(b) there has been no breach of Clauses 21.6, 21.7, 21.8,
21.9, 21.10, 21.12, 21.14, 21.15, 21.16, 21.17, 21.26,
21.35, 21.36 or 21.40 by any of the Newcos which has not
been waived by the Original Lenders;
(c) no Default or Event of Default has occurred and is
continuing or would result from the making of such
Utilisation under any of Clauses 23.1(f), (g), (h), (i),
(j), or (k), by or relating to any of the Newcos, any
Borrower, any of the Targets or any other company
specified in Schedule 7 Part III (save where, in the case
of any Target or company specified in Schedule 7 Part III
which is not (i) a Newco or a Borrower or a Holding
Company of a Borrower or (ii) a Material Group
Subsidiary, no formal insolvency, bankruptcy,
dissolution, liquidation or administration or similar
proceedings have been commenced and no such company has
taken any steps to commence any such proceedings);
(d) no Default or Event of Default has occurred and is
continuing or would result from the making of such
Utilisation under any of Clauses 23.1(d), (e), (n), (o)
or (p) by or relating to any of the Newcos or the
Acquisition Agreements;
(e) the Company has provided to the Facility Agent evidence
satisfactory to it (acting reasonably) that on and from
the Signing Date the business and assets of the Target
Group have been adequately insured.
This Clause 4.2 does not affect the rights of the Finance Parties
in respect of any breach of representation or warranty made or
deemed repeated on the first Utilisation Date under Clause 20.2 or
any Default or Event of Default occurring on or in existence on the
first Utilisation Date. No such Default or Event of Default shall
be waived by the making of the first Utilisations under this
Agreement and the Finance Parties reserve all of their rights and
remedies in respect of any such Default or Event of Default.
4.3 Conditions Precedent to each other Utilisation
The obligations of the Finance Parties in respect of each
Utilisation made after the first Utilisation Date (and for the
avoidance of doubt this Clause 4.3 does not apply to any
Utilisations being made on the Closing Date) are subject to the
further condition precedent that both at the date of the Request
for such Utilisation and at the Utilisation Date therefor:
(a) in respect of each Tranche D Advance requested to be made
to a Borrower which is matched by a Tranche D Advance of
the same (or a greater) amount which is repaid by such
Borrower under Clause 8.4 on the proposed Utilisation
Date for such Advance (a "Rollover Utilisation"), no
Event of Default has occurred and is continuing or would
result from the making of such Rollover Utilisation which
has not been waived; and
(b) in respect of each Utilisation (other than a Rollover
Utilisation) the representations and warranties in Clause
20 to be repeated on those dates are correct and will be
correct immediately after the Utilisation is made and no
Default has occurred and is continuing or would result
from the making of such Utilisation which has not been
waived.
4.4 Utilisation of Tranche E Facility
(a) Without prejudice to Clauses 4.1 and 4.3, the obligations of the
Finance Parties in respect of each Tranche E Utilisation are
subject to the further conditions precedent that:
(i) the Facility Agent is satisfied that the Investors Capex
Contribution Amount, if any, for the relevant annual
Accounting Period (the first of which shall end on 31st
December, 1998) and (if contemplated in the definition of
Investors Capex Contribution Amount) for each previous
annual Accounting Period of the Group has been made and
that the Company has received the proceeds of such
Investors Capex Contribution Amount in cash; and
(ii) except in the case of any Tranche E Utilisation made
prior to 31st December, 1998, the Facility Agent has
received not less than 5 Business Days before the
proposed Utilisation Date the unaudited consolidated
management Accounts of the Group for the previous
December under Clause 21.2(c) showing the amount (if any)
of the Excess Cash Capex Amount.
(b) The Company will procure that the aggregate Original Sterling
Amount of the Tranche E Utilisations in any annual Accounting
Period shall not exceed the budgeted Capital Expenditure for such
annual Accounting Period shown in Clause 22.3 as increased with the
agreement of the Majority Lenders in accordance with this Agreement
plus any amount of Capital Expenditure permitted to be carried
forward from the previous annual Accounting Period under Clause
22.3, minus the aggregate of (A) the Investors Capex Contribution
Amount for such annual Accounting Period, (B) the Excess Cash Capex
Amount for such annual Accounting Period and (C) any amount
standing to the credit of the Capex Blocked Account at the start of
such annual Accounting Period.
(c) (i) The proceeds of each Tranche E Advance must be paid into the
Capex Blocked Account.
(ii) Where a Tranche E Utilisation is made by way of a
Documentary Credit the Company will procure that on issue
of the Documentary Credit the bank or financial
institution providing the facility backstopped by such
Documentary Credit will pay an amount equal to the
principal amount of such Documentary Credit into the
Capex Blocked Account.
(iii) Amounts may only be withdrawn by a member of the Group
from the Capex Blocked Account to be applied in or
towards any Capital Expenditure or if approved by the
Majority Lenders in payment of any amount due under this
Agreement provided that amounts standing to the credit of
the Capex Blocked Account shall not be used to prepay
Tranche B Advances or Tranche E Utilisations outstanding
to a Canadian resident borrower if such prepayment would
cause more than 25% of the Original Sterling Amount of
such Tranche B Advances or Tranche E Utilisations to be
repaid during a Withholding Period taking into account
all scheduled Repayment Instalments and all prepayments
of such Tranche B Advances and Tranche E Utilisations
already made (except as a consequence of an Event of
Default).
(iv) Before any member of the Group may withdraw any amount
from the Capex Blocked Account in any annual Accounting
Period the Company must deliver to the Facility Agent a
certificate signed by the Chief Financial Officer
certifying that (A) an amount at least equal to the
aggregate of the Investors Capex Contribution Amount plus
the Excess Cash Capex Amount for such annual Accounting
Period has already been spent on Capital Expenditure by
members of the Group during such annual Accounting
Period, and (B) the amount to be withdrawn from the Capex
Blocked Account will be applied in financing Capital
Expenditure of members of the Group.
(d) No more than four Tranche E Utilisations may be drawn down in any
annual Accounting Period.
(e) Each Tranche E Utilisation shall be in a minimum Original Sterling
Amount of(pound)500,000 and if greater in an integral multiple
of(pound)100,000.
(f) Where a Tranche E Utilisation has been made and the amount of such
Tranche E Utilisation was determined by reference to the Excess
Cash Capex Amount as shown in the unaudited monthly management
Accounts of the Group for the previous December delivered under
Clause 21.2(c) and following receipt of the audited consolidated
Accounts of the Group for the previous annual Accounting Period
under Clause 21.2(a)(i) it is shown that the Excess Cash Capex
Amount is greater than the Excess Cash Capex Amount shown in such
unaudited monthly management Accounts (such excess amount being
hereinafter referred to as the "Excess Amount"), the amount of all
future Tranche E Utilisations shall be reduced by an aggregate
amount equal to the Excess Amount.
5. DRAWDOWN
5.1 Receipt of Requests
(a) A Borrower may make a Utilisation if the Facility Agent receives
from the Obligors' Agent, not later than 11.00 a.m. three Business
Days before the proposed Utilisation Date (or, in respect of
Utilisations to be made at Closing, by such other time as the
Original Lenders may agree), a Request complying with Clause 5.2.
(b) Unless the relevant Documentary Credit is substantially in the form
set out in Schedule 8, no Request may be made hereunder requesting
the issuance of a Documentary Credit until the form of the
Documentary Credit has been agreed by the Facility Agent, the
Obligors' Agent, the beneficiary and either the LC Bank or (in the
case of a Documentary Credit to be issued severally by the Lenders)
the Lenders. Any Documentary Credit issued under the Tranche E
Facility shall be issued severally by the Lenders.
5.2 Completion of Requests
Each Request will specify the name of the relevant Borrower and:
(a) the Utilisation Date, being a Business Day in the
relevant Availability Period;
(b) whether the Utilisation is a Tranche A Advance, a Tranche
B Advance, a Tranche C Advance, a Tranche D Utilisation,
or a Tranche E Utilisation;
(c) the principal amount of the Utilisation being, in the
case of the Tranche A Advances, the Tranche B Advances
and the Tranche C Advances the amounts shown in the Funds
Flow Statement, in the case of a Tranche D Utilisation or
a Tranche E Utilisation an amount the Sterling Equivalent
of which (calculated on the date of such Request) shall
not be less than (pound)500,000 and if more shall be an
integral multiple of (pound)500,000 (or its equivalent in
other currencies) or the available undrawn amount of the
Tranche D Commitments or Tranche E Commitments, as the
case may be, provided always that the requested amount
for a Tranche D Utilisation may not exceed the then
Available Facility Amount;
(d) in relation to an Advance the duration of its (or its
first) Interest Period;
(e) if a Tranche D Utilisation or a Tranche E Utilisation,
whether the Utilisation is by way of Advance or
Documentary Credit;
(f) the currency of the Advance or Documentary Credit
requested;
(g) in the case of a Documentary Credit, the name and address
of the beneficiary, the beneficiary's receiving bank
account and reasonable details of the liabilities payment
of which is to be assured by the Documentary Credit, as
well as the Expiry Date of the Documentary Credit (which
in the case of a Tranche D Utilisation shall be less than
one year from the Utilisation Date therefor unless the
Facility Agent shall otherwise agree); and
(h) in the case of an Advance, payment instructions (being,
in the case of an Advance to be made on the Closing Date,
instructions to pay to a Closing Account).
The Facility Agent shall promptly notify the relevant Lenders of
the details of the requested Utilisation and, in the case of an
Advance, the currency and amount of its participation in such
Advance.
Each Request shall be irrevocable and the Borrower named therein
shall be bound to borrow the Advance or accept the issue of the
Documentary Credit referred to therein.
5.3 Amount of each Lender's participation in Advance
The amount of a Lender's participation in any Advance will be the
proportion of the Advance which its Commitment bearing the same
designation bears to the aggregate of the Lenders' Commitments
bearing such designation on the date of receipt of the relevant
Request.
5.4 Payment of Proceeds
Subject to the terms of this Agreement, each Lender shall make its
participation in each Advance available to the Facility Agent for
the relevant Borrower on the relevant Utilisation Date.
5.5 Issue of Documentary Credits
(a) Subject to the terms of this Agreement, on the proposed Utilisation
Date for a Documentary Credit, either the LC Bank or the Facility
Agent (on behalf of all the Lenders severally in proportion to
their Tranche D Commitments or Tranche E Commitments, as the case
may be,) will when requested issue a Documentary Credit, in the
form set out in Schedule 8 or otherwise in a form approved, as
specified in the relevant Request by delivering the same to or to
the order of the beneficiary.
(b) The LC Bank shall not be obliged to issue a Documentary Credit if
it has not approved the identity of any assignee or transferee of
or substitute for any Lender with respect to its Tranche D
Commitment or any part thereof, in which case such Documentary
Credit will be issued by the Facility Agent on behalf of the
Lenders severally in proportion to their Tranche D Commitments. Any
Documentary Credit issued under the Tranche E Facility, will be
issued by the Facility Agent on behalf of the Lenders severally in
proportion to their Tranche E Commitments.
5.6 Counter-Indemnity from Account Party
(a) Without prejudice to Clause 5.7, the Borrower for whose account any
Documentary Credit is opened or issued (the "Account Party") will
indemnify and hold harmless and keep each Finance Party indemnified
and held harmless from and against all liabilities, losses,
damages, claims and costs which such Finance Party may suffer or
incur in connection with such Documentary Credit and any payment
made pursuant to it, except to the extent that any such liability,
loss, damage, claim or cost results from such Finance Party's
negligence or wilful misconduct or a breach of its obligations
under the Uniform Customs and Practice for Documentary Credits
(1993) (ICC Publication No. 500) (the "Code").
(b) Each Account Party irrevocably authorises each Finance Party to pay
without further confirmation or investigation from or by it any
demand appearing or purporting to be validly made pursuant to any
Documentary Credit. Where any Documentary Credit calls for
certificates or other documents each Finance Party may assume,
without investigation, that the certificates or documents tendered
are duly signed by the person by whom they appear to be signed and
that such certificates or documents and any matters or facts stated
therein are genuine and correct. Without prejudice to the rights
under the Code (which shall apply in relation to all Documentary
Credits issued under this Agreement), the relevant Account Party
agrees to reimburse each Finance Party forthwith on written demand
for any amounts paid by such Finance Party pursuant to any such
demand in the currency paid by such Finance Party, together with
interest on such amounts at a rate determined in accordance with
Clause 10.3 from the date such amounts are paid by such Finance
Party until reimbursement as aforesaid.
(c) The obligations of each Account Party under this Clause 5.6 shall
not be impaired by (a) any waiver or time granted to or by any
Finance Party, (b) any release or dealings with any rights or
security by any Finance Party (including, without limitation, under
the Finance Documents), (c) any invalidity of any Documentary
Credit, or (d) any other circumstances which might impair such
obligations.
(d) So long as any amount is or is capable of becoming outstanding by
any Obligor to any of the Finance Parties under any of the Finance
Documents or any Commitment is in force, no Account Party shall by
virtue of any payment made by it pursuant to this Clause 5.6 or by
virtue of any realisation of security made in respect of its
obligations under this Clause 5.6, claim or exercise any right of
subrogation, contribution or indemnity against any member of the
Group in competition with any Finance Party.
(e) The general obligations of the Finance Parties under the Code in
respect of any Documentary Credit shall be supplemented by any
specific written instructions from the Obligors' Agent which any
such Finance Party agrees in writing to implement in respect of a
specific Documentary Credit.
5.7 Lenders' Counter-guarantee
(a) Each Lender as primary obligor guarantees to the LC Bank, on demand
by the LC Bank from time to time, the due performance by each
Account Party in relation to each Documentary Credit issued by the
LC Bank, of its obligations under Clause 5.6, provided that the
liability of each Lender in relation to any particular default in
performance of such obligations by such Account Party shall not
exceed such Lender's pro rata share (being the proportion which its
Tranche D Commitment bears to the aggregate of the Tranche D
Commitments at the date the Documentary Credit was issued) of the
amount in default.
(b) (i) Unless the LC Bank has confirmed in writing to any Lender
(not being an Original Lender) which has a Tranche D
Commitment (a "Tranche D Lender") that it would not
require such Tranche D Lender to make any deposit with
it, the LC Bank may require that any such Tranche D
Lender which has a long term credit rating of less than
A- (when rated by Standard and Poor's Corporation) or A3
(when rated by ▇▇▇▇▇'▇ Investor Services Inc.) deposits
(free of Encumbrances or third party claims) with the LC
Bank prior to 10.00 a.m. on the Utilisation Date for any
Documentary Credit to be issued pursuant to the Tranche D
Facility by the LC Bank (or if later within 3 Business
Days of any such request by the LC Bank) an amount equal
to the maximum potential liability of such Tranche D
Lender to the LC Bank under this Clause 5.7 in respect of
such Documentary Credit.
(ii) The LC Bank shall be entitled to apply such deposit (by
application of funds, set-off, combination of accounts or
otherwise as the LC Bank shall determine) against amounts
due to it from such Tranche D Lender under this Clause
5.7.
(iii) Any such deposit shall be on terms that the LC Bank shall
only be required to repay such deposit to or to the order
of such Tranche D Lender on the expiry (if no demand has
then been made under such Documentary Credit) or
repayment in full of the relevant Documentary Credit or
on compliance in full by such Tranche D Lender with its
obligations to the LC Bank under Clause 5.7(a) and (d)
(as supplemented by Schedule 9).
(iv) Any such deposit shall be denominated in the same
currency as payments are to be made under such
Documentary Credit and shall bear interest at a rate of
LIBID minus 0.125% per annum calculated on the aggregate
amount of the deposit, on the basis referred to in Clause
10.6. Such interest shall be payable (subject to
deduction of Tax if so required by applicable law) by the
LC Bank to such Tranche D Lender quarterly in arrears (or
as otherwise agreed) until repayment of the deposit or
application of the deposit by the LC Bank against the
obligations of such Tranche D Lender to it under Clause
5.7(a) and (d) (as supplemented by Schedule 9).
(c) The LC Bank shall promptly notify each Lender, the Facility Agent
and the Company of any demand served on it under any Documentary
Credit and each payment made pursuant thereto and of any failure by
any Account Party in performing its obligations under Clause 5.6.
(d) The guarantees of each of the Lenders contained in this Clause 5.7
shall be as supplemented by the terms set out in Schedule 9 (to
which terms each Lender consents). The provisions of Clauses 12.4
and 13.1 shall apply, mutatis mutandis, in relation to payments to
be made by each Lender to the LC Bank pursuant to this Clause.
(e) Each Obligor agrees that, to the extent that any Lender makes any
payment to the LC Bank pursuant to this Clause 5.7, that Lender
will thereupon be subrogated to any rights the LC Bank may then
have against any Obligor in respect of the amount so paid by that
Lender, and each Account Party will indemnify such Lender in
respect of the amount so paid by that Lender. Each Account Party
shall also indemnify that Lender against all costs and expenses
incurred by that Lender in recovering or attempting to recover any
amount pursuant to its rights of subrogation referred to above.
5.8 LC Bank's Position
To the extent not inconsistent with the LC Bank acting as principal
and not as agent in issuing and agreeing to issue any Documentary
Credit under this Agreement and, subject to Clause 5.6 (e) above,
the provisions of Clause 24 excluding or restricting liability and
responsibility shall apply mutatis mutandis for the benefit of the
LC Bank in its relations with the Lenders and each Account Party.
5.9 Change of LC Bank
(a) The Facility Agent, with the prior approval of the Company and the
Majority Lenders, may designate any Lender (if such Lender agrees
so to act) as a replacement LC Bank, but not with respect to
Documentary Credits already issued by an existing LC Bank.
(b) The LC Bank may resign at any time on or after the first
anniversary of the Closing Date on giving not less than three
months' prior written notice to the Facility Agent and the Company
to expire on or after such first anniversary if (i) the Company and
the Majority Lenders consent, or (ii) there is in the reasonable
opinion of the LC Bank an actual or potential conflict of interest
in it continuing to act as LC Bank, or (iii) it ceases to have a
Commitment in effect.
(c) If the LC Bank does so resign and no replacement is so appointed,
any Documentary Credit to be issued in accordance with the terms of
this Agreement will be issued by the Facility Agent on behalf of
the Lenders severally in proportion to their respective Tranche D
Commitments as in effect at the date of issue.
6. OPTIONAL CURRENCIES
6.1 Selection of Optional Currency
The Obligors' Agent may in any Request in relation to any Advance
or Documentary Credit, specify an Optional Currency in which it
wishes that Advance or Documentary Credit to be denominated and the
Facility Agent shall promptly notify the Lenders of that request.
6.2 Notification of Agent's Spot Rate of Exchange
If a Utilisation is to be denominated or issued in an Optional
Currency, the Facility Agent shall promptly notify the Obligors'
Agent and the Lenders of the applicable Agent's Spot Rate of
Exchange, the Optional Currency amount and the Sterling Equivalent
of such Utilisation as soon as practicable after they are
ascertained.
6.3 Determination of Currency
If a Lender (the "Determining Lender") gives notice to the Facility
Agent (which shall promptly notify the Obligors' Agent) before
10.00 a.m. at least two Business Days prior to the Utilisation Date
relative to any Advance to be denominated in Sterling or an
Optional Currency certifying in that notice that by reason of
circumstances affecting the London Interbank Market deposits in the
currency specified in the relevant Request of an amount of not less
than its participation in such Advance will not be readily
available to it in the London Interbank Market for the Interest
Period relative to such Advance, (such certification being, in the
absence of manifest error, conclusive against the relevant
Borrower), then the Obligors' Agent and the Facility Agent may
agree before 11.00 a.m. two Business Days prior to the proposed
Utilisation Date that the drawdown shall not be made (and the
Facility Agent shall promptly notify the Lenders of such fact) or
that the Determining Lender's portion of such Advance shall be
denominated in Sterling (if not initially requested) or a different
Optional Currency, and in the absence of such notice from the
Obligors' Agent by such time the Determining Lender's portion of
such Advance shall be denominated in Sterling. Such changes shall
be deemed to be made to the definition of LIBOR as the Facility
Agent may reasonably determine to be necessary for the purpose of
determining LIBOR to apply to the Determining Lender's portion of
such Advance, which rate it shall notify to the Obligor's Agent and
the relevant Lenders.
6.4 Revocation of currency
If prior to 10.00 a.m. on the second Business Day prior to the
proposed Utilisation Date there shall occur any changes in national
or international, financial, political or economic conditions,
currency availability, currency exchange rates or exchange controls
which, in the reasonable opinion (which shall be conclusive) of the
Facility Agent after consultation with the Reference Banks, render
it impracticable for any Advance to be denominated in Sterling or
the Optional Currency concerned, the Facility Agent shall give
notice to the Obligors' Agent to that effect before 10.30 a.m. two
Business Days prior to the Utilisation Date for the making of that
Advance. In that event the Obligors' Agent and the Facility Agent
may agree before 11.00 a.m. two Business Days prior to the proposed
Utilisation Date that the drawdown shall not be made (and the
Facility Agent shall promptly notify the Lenders of such fact) and
in the absence of such agreement the relevant Advance shall be
denominated in Sterling as specified by the Facility Agent unless
the Obligors' Agent, the Facility Agent and the Lenders
participating in such Advance agree that it shall be denominated in
another Optional Currency (in which case, for the purpose only of
determining LIBOR to apply to that Advance, such changes shall be
deemed to be made to the definition of LIBOR as the Facility Agent
may reasonably determine, and which it shall notify to the
Obligors' Agent and the Lenders).
6.5 Amount
Subject as otherwise provided in this Agreement if an Advance is to
be made in an Optional Currency, each Lender will make available to
the Facility Agent an amount in that Optional Currency determined
by notionally converting into that Optional Currency such Lender's
participation in the Original Sterling Amount of that Advance on
the basis of the Agent's Spot Rate of Exchange two Business Days
before the proposed Utilisation Date.
7. ANCILLARY FACILITIES
7.1 Ancillary Facility
(a) The Obligors' Agent may, at any time during the Tranche D
Availability Period, by notice in writing to the Facility Agent
request the establishment of an Ancillary Facility by the
conversion of any Bank's undrawn Tranche D Commitment (or part
thereof) into an Ancillary Commitment with effect from the date
(the "Effective Date") specified in such notice (being a date not
less than five Business Days after the date such notice is received
by the Facility Agent). Any such notice shall specify:
(i) the proposed Borrower;
(ii) the proposed start and expiry date for the Ancillary
Facility concerned (and the expiry date must fall on or
prior to the date 90 months from the Closing Date);
(iii) the type of the proposed Ancillary Facility;
(iv) the proposed Ancillary Bank;
(v) the amount of the proposed Ancillary Commitment; and
(vi) such other details as to the nature, amount and operation
of the proposed Ancillary Facility as the Facility Agent
may reasonably require,
and the Facility Agent shall promptly notify each Bank upon receipt
of any such notice.
(b) Any Bank so nominated shall become an Ancillary Bank authorised to
make the proposed Ancillary Facility available with effect on and
from the Effective Date subject to the approval of the Facility
Agent (acting reasonably) and the Facility Agent having received
notification in writing from the Bank so nominated that it approves
of the proposed Ancillary Facility. Such Bank shall have no
obligation to give such an approval.
(c) Any material variation in any Ancillary Facility or any proposed
increase or reduction in the Ancillary Commitment relating thereto
shall be effected on and subject to the provisions, mutatis
mutandis, of this Clause 7.
(d) Until notice has been served under any of Clauses 23.2(b), (c) (and
a demand for payment has been made as referred to therein), (d) or
(e), no Ancillary Bank may demand repayment of any moneys or demand
cash cover for any liabilities made available or incurred by it
under its Ancillary Facility, or take any analogous action under
its Ancillary Facility, save to the extent that there is at such
time a Tranche D Advance available to be drawn down under this
Agreement (and for the purposes of determining whether or not a
Tranche D Advance is so available the Tranche D Commitment of the
Ancillary Bank shall be deemed to be increased by the amount, not
exceeding the amount of its Ancillary Commitment, so demanded, such
Tranche D Advance shall be deemed to be a Rollover Advance and
Clause 2.2(d) shall not apply), and such Tranche D Advance shall be
used to repay or provide cash cover in respect of the amount so
demanded under the Ancillary Facility. Each Bank will participate
in such Tranche D Advance in such amount (as determined by the
Facility Agent) as will result as nearly as possible in the
aggregate amount of its participation in all of the Tranche D
Advances and its maximum potential liability in respect of
Documentary Credits (whether under such Documentary Credits or
under Clause 5.7) then outstanding bearing the same proportion to
the aggregate amount of the Tranche D Utilisations then outstanding
as its Tranche D Commitment bears to the aggregate of the Tranche D
Commitments.
(e) The Ancillary Commitment of any Ancillary Bank shall terminate no
later than the date 90 months from the Closing Date. Any Ancillary
Outstanding on the date 90 months from the Closing Date shall be
repaid in full by the relevant Borrower on such date.
7.2 Operation of Ancillary Facilities
(a) The rate of interest, fees and other remuneration in respect of
each Ancillary Facility shall be determined by agreement between
the Ancillary Bank and the Borrower concerned and the fees and
other remuneration for all Ancillary Facilities shall be based upon
the normal market rates and terms from time to time of the
Ancillary Bank.
(b) In the case of inconsistency between any term of an Ancillary
Facility and of this Agreement, the terms of this Agreement shall
prevail.
(c) Subject to paragraphs (a) and (b) above, the terms governing the
operation of any Ancillary Facility shall be those determined by
agreement between the Ancillary Bank and the Borrower concerned,
PROVIDED THAT such terms are based upon normal commercial terms,
save as may be varied by this Agreement. A copy of any such terms
shall on request by the Facility Agent be provided by the Ancillary
Bank to the Facility Agent (and each Borrower consents to such
copies being provided to the Facility Agent and, if requested, any
Bank).
(d) Each Borrower and the Ancillary Bank agrees with and for the
benefit of each Bank that the Ancillary Outstandings under any
Ancillary Facility provided by that Ancillary Bank shall not exceed
the Ancillary Commitment applicable to that Ancillary Facility.
(e) Each Borrower and each Ancillary Bank will, promptly upon request
by the Facility Agent, supply the Facility Agent with such
information relating to the operation of each Ancillary Facility
provided by such Ancillary Bank (including, without limitation, the
Ancillary Outstandings thereunder) as the Facility Agent may from
time to time reasonably request. Each Borrower consents to all such
information being released to the Facility Agent and each Bank.
8. REPAYMENT
8.1 Tranche A Facility
(a) Subject to Clause 9, the Borrowers shall repay each of the Tranche
A Advances in full by the instalments specified below on the
Tranche A Repayment Dates specified below. The amount of each
Tranche A Advance repaid by the Borrowers on each Tranche A
Repayment Date shall be the percentage of the amount of each such
Tranche A Advance made at Closing set out below opposite that
Tranche A Repayment Date. The aggregate of the amounts of each
Tranche A Advance repaid on any Tranche A Repayment Date is a
"Tranche A Repayment Instalment".
Tranche A Tranche A
Repayment Dates Repayments
(months from first Utilisation Date) (% of each Tranche A Advance
made at Closing)
6 2.00%
12 2.00%
18 4.50%
24 4.50%
30 6.40%
36 6.40%
42 7.75%
48 7.75%
54 7.00%
60 7.00%
66 8.75%
72 8.75%
78 8.50%
84 8.50%
90 10.20%
Any amount of the Tranche A Advances outstanding on the Final A
Repayment Date shall be repaid in full on the Final A Repayment
Date.
(b) The Tranche A Advances shall each be repaid pro rata on each
Tranche A Repayment Date.
8.2 Tranche B Facility
(a) Subject to Clause 9, the Borrowers shall repay the Tranche B
Advances in full by the instalments specified below on the Tranche
B Repayment Dates specified below. The aggregate Original Sterling
Amount of the Tranche B Advances (a "Tranche B Repayment
Instalment") repaid by the Borrowers on each Tranche B Repayment
Date shall be the amount representing the percentage of the
aggregate Original Sterling Amount of the Tranche B Advances made
at Closing set out below opposite that Tranche B Repayment Date.
Tranche B Tranche B
Repayment Dates Repayment Instalments
(months from first Utilisation Date) (% of Tranche B Advances made at Closing)
12 1%
24 1%
36 1%
48 1%
60 1%
72 1%
84 1%
96 93%
Any Amount of the Tranche B Advances outstanding on the date 96
months from the first Utilisation Date shall be repaid in full on
such date.
(b) The Tranche B Advances shall each be repaid pro rata on each
Tranche B Repayment Date.
8.3 Tranche C Facility
(a) Subject to Clause 9, the Borrowers shall repay the Tranche C
Advances in full by the instalments specified below on the Tranche
C Repayment Dates specified below. The aggregate Original Sterling
Amount of the Tranche C Advances (a "Tranche C Repayment
Instalment") repaid by the Borrowers on each Tranche C Repayment
Date shall be the amount representing the percentage of the
aggregate Original Sterling Amount of the Tranche C Advances made
at Closing set out below opposite that Tranche C Repayment Date.
Tranche C Tranche C
Repayment Dates Repayment Instalments
(months from first Utilisation Date) (% of Tranche C Advances made at Closing)
12 1%
24 1%
36 1%
48 1%
60 1%
72 1%
84 1%
96 1%
108 92%
Any Amount of the Tranche C Advances outstanding on the Final
Maturity Date shall be repaid in full on such date.
(b) The Tranche C Advances shall each be repaid pro rata on each
Tranche C Repayment Date.
8.4 Tranche D Advances
(a) Each Borrower shall repay the full amount of each Tranche D Advance
made to it on the Interest Date relating to that Advance. Any
Tranche D Utilisation then outstanding shall be repaid in full on
the earlier of the Final A Repayment Date and the day on which the
Term Advances are repaid or prepaid in full.
(b) Without prejudice to each Borrower's obligations to repay the full
amount of each Tranche D Advance made to it on the due date, on the
date of any Rollover Utilisation made by any Borrower the amount to
be repaid and the amount to be drawn down by such Borrower shall be
netted off against each other so that the amount of cash which such
Borrower is actually required to repay or, as the case may be, the
amount of cash which the Lenders are actually required to advance
to such Borrower, shall be the net amount.
8.5 Tranche E Facility
(a) Subject to Clause 9, the Borrowers shall repay the Tranche E
Utilisations in full by the instalments specified below on the
Tranche E Repayment Dates specified below. The aggregate Original
Sterling Amount of the Tranche E Utilisations (a "Tranche E
Repayment Instalment") repaid by the Borrowers on each Tranche E
Repayment Date shall be the amount representing the percentage of
the aggregate Original Sterling Amount of the Tranche E
Utilisations outstanding on the seventh anniversary of the first
Utilisation Date set out below opposite that Tranche E Repayment
Date.
Tranche E Tranche E
Repayment Dates Repayment Instalments
(months from first Utilisation Date) (% of Tranche E Utilisations outstanding on the seventh
anniversary of the first
Utilisation Date)
96 50%
108 50%
Any Amount of the Tranche E Utilisations outstanding on the Final
Maturity Date shall be repaid in full on such date.
(b) The Tranche E Repayment Instalments shall be applied first in
repayment of all Tranche E Advances pro rata until repaid or
prepaid in full and second in prepayment of all Tranche E
Utilisations made by way of Documentary Credit pro rata until such
Tranche E Utilisations are repaid in full.
9. PREPAYMENT AND CANCELLATION
9.1 Automatic Cancellation of the Total Commitments
(a) Any part of the Tranche A Commitments, the Tranche B Commitments,
the Tranche C Commitments or the Tranche E Commitments not borrowed
hereunder before the expiry of the Tranche A Availability Period,
Tranche B Availability Period, Tranche C Availability Period or
Tranche E Availability Period respectively shall be automatically
cancelled at close of business on such expiry.
(b) The Tranche D Commitments shall be automatically cancelled at close
of business on the expiry of the Tranche D Availability Period.
9.2 Voluntary Cancellation
The Obligors' Agent may, by giving not less than five Business Days
prior notice to the Facility Agent, cancel the unutilised portion
of the Tranche D Commitments or the Tranche E Commitments in whole
or in part (but, if in part in a minimum amount of (pound)5,000,000
and integral multiples of (pound)1,000,000) without incurring any
penalty or other cost, but subject in the case of the Tranche D
Commitments to providing to the Facility Agent evidence reasonably
satisfactory to the Majority Lenders that notwithstanding such
cancellation the Group will have sufficient working capital
facilities available to it to enable the businesses of the Group
members to be operated substantially as contemplated in the
Business Plan and in such a way as to enable the Obligors to repay
all outstandings under the Senior Finance Documents on or before
the due date for each such amount. Any cancellation in part of the
Tranche D Commitments or the Tranche E Commitments shall be applied
against the Tranche D Commitment or the Tranche E Commitments, as
the case may be, of each Lender pro rata.
9.3 Voluntary Prepayment
(a) Subject to Clause 9.6, on giving at least five Business Days prior
notice to the Facility Agent, specifying the Utilisation and amount
to be prepaid, any Borrower may prepay any Utilisation made by it
in whole or in part on the date and in the amount so specified.
Such payment of a Utilisation shall be, if in part, in an Original
Sterling Amount of not less than (pound)5,000,000 (or if more shall
be in an integral multiple of (pound)1,000,000). No such prepayment
of a Term Advance may be made unless the Term Advances are all
prepaid pro rata, save as provided in paragraph (b) below.
(b) Any such prepayment shall be applied pro rata against the
participations of the Lenders in the Utilisation prepaid PROVIDED
THAT in the case of any partial prepayment of the Tranche B
Advances or Tranche C Advances or Tranche E Utilisations (but not
in the case of a prepayment in full) any Lender (the "Notifying
Lender") having a participation in the Tranche B Advances or the
Tranche C Advances or the Tranche E Utilisations then outstanding
may by notice to the Facility Agent decline to accept such
prepayment of its participation (the amount of such prepayment
being the "Declined Amount") in such Tranche B Advances or Tranche
C Advances or Tranche E Utilisations. The Declined Amount shall be
treated as a new prepayment under this Clause 9.3 and, subject as
provided in this paragraph (b), shall be applied in prepayment of
the Term Advances pro rata.
9.4 Right of prepayment and cancellation
If any Borrower is required to pay any amount to a Lender under
Clauses 13, 14 or 15 the Obligors' Agent may, whilst the
circumstances giving rise to the requirement continue, serve a
notice of prepayment and cancellation on that Lender through the
Facility Agent. On the date falling seven Business Days after the
date of service of the notice:
(a) each Borrower shall prepay that Lender's participation in
any Utilisation (including any participation through the
operation of Clause 5.7) made to it together with all
other amounts payable by it to that Lender under this
Agreement; and
(b) all such Lender's Commitments shall be cancelled (but
without prejudice to such Lender's obligations under
Clause 5.7).
9.5 Mandatory Prepayment from Net Proceeds
If:
(a) any of the assets, business or undertaking of any member
of the Group are disposed of; or
(b) any funds are recovered from any of the Vendors under the
Acquisition Agreements which represent Net Proceeds and
which are not, within 12 months of receipt by a member of
the Group, applied in meeting the liability or loss which
gave rise to the claim; or
(c) any funds which represent Net Proceeds are recovered
pursuant to a claim by a member of the Group under any
insurance policy,
the Company, unless the Majority Lenders shall otherwise consent in
writing, shall apply, or shall procure that a Subsidiary of it
shall apply forthwith an amount equal to the Net Proceeds arising
from the disposal or recovery in or towards prepayment of the
Utilisations in accordance with this Clause 9, provided that the
foregoing shall not apply to Net Proceeds arising from:
(i) a disposal of trading stock or services in the ordinary
course of trading; or
(ii) a disposal of assets not constituting trading stock which
are to be replaced by other assets being acquired for use
for like purposes and are so replaced within twelve
months of the date of such disposal (save to the extent
the Net Proceeds exceed the acquisition cost of those
replacement assets) and where an amount equal to the full
amount of such Net Proceeds is paid into the Disposals
Account as referred to below at the time of receipt of
such Net Proceeds by the relevant member of the Group; or
(iii) any disposal permitted by Clause 21.8(b)(i), (iii), (iv),
(v), (vi) or (x); or
(iv) any disposal the Net Proceeds from which, when taken
together with the consideration for any related
disposals, does not exceed(pound)75,000 (or its
equivalent in other currencies); or
(v) any disposal of assets the Net Proceeds from which, when
aggregated with the Net Proceeds of all other disposals
made by any other member of the Group in any twelve month
period (other than any referred to in paragraphs (i),
(ii), (iii) or (iv) above), does not exceed
(pound)2,500,000 (or its equivalent in other currencies)
and the Net Proceeds of each disposal thereafter in such
twelve month period (other than disposals referred to in
paragraphs (i), (ii), (iii) or (iv) above) shall be
applied in prepayment,
PROVIDED THAT:
(I) if the Company gives notice to the Facility Agent that it
wishes the provisions of Clause 9.5 (ii) to apply the
Company may pay or procure the payment into an interest
bearing account (the "Disposals Account") in the name of
the Company held with the Facility Agent in London of an
amount equal to the Net Proceeds received by such member
of the Group at the time of receipt by the relevant
member of the Group of the Net Proceeds;
(II) no amounts may be paid into the Disposals Account save as
expressly permitted by this Clause 9.5;
(III) while any amount remains outstanding under any of the
Senior Finance Documents no amount may be withdrawn by
any member of the Group from the Disposals Account except
for (A) application in the acquisition of a replacement
asset (as contemplated in Clause 9.5(ii) above) within
twelve months of the date on which the asset which is
being replaced was disposed of, or (B) application in
repayment or prepayment of any Utilisation;
(IV) at any time after an Event of Default has occurred which
is continuing unwaived the Facility Agent may (but is not
obliged to) apply the whole or any part of the sums
standing to the credit of the Disposals Account in or
towards payment of any amount due from any Obligor under
the Senior Finance Documents but unpaid.
A Borrower resident in Canada shall not be obliged to prepay any
Tranche B Advance, Tranche C Advance or Tranche E Utilisation from
any funds received by it under Clause 9.5(b) if such prepayment
would cause more than 25% of the Original Sterling Amount of such
Tranche B Advances, Tranche C Advances or Tranche E Utilisations to
be repaid during a Withholding Period taking into account all
scheduled Repayment Instalments and all prepayments of such Tranche
B Advances, Tranche C Advance or Tranche E Utilisations already
made (except as a consequence of an Event of Default).
No Borrower that is a Canadian resident shall fail to prevent an
event which would entitle a claim to be made by it under any
insurance policy as contemplated in paragraph (c) above. Failure by
any such Borrower to avoid such event shall result (only) in such
Borrower being required to repay an amount of the Utilisations in
an amount equal to the Net Proceeds of any such claim.
9.6 Order of Application
Any amount required to be applied in prepayment pursuant to Clauses
9.3 or 9.5, shall be applied as follows:
(a) first, in prepayment of the Term Advances pro rata until
repaid or prepaid in full;
(b) second, in prepayment of the Tranche D Utilisations pro
rata until the Tranche D Utilisations are prepaid in
full.
9.7 Adjustment of Repayment Instalments
(a) Each prepayment of the Term Advances made pursuant to Clause 9.3
shall be applied against future Repayment Instalments determined
pursuant to Clause 8 as the Obligors' Agent directs in writing to
the Facility Agent at the time of prepayment.
(b) Each prepayment of a Term Advance made pursuant to any other
provision of this Agreement shall be applied against future
Repayment Instalments relative to such Term Advance determined
pursuant to Clause 8 pro rata.
9.8 Date for Prepayment
(a) If any Borrower becomes obliged to prepay or procure the prepayment
of any amount under Clause 9.5 the prepayment shall be made on the
next Interest Date relating to the Advance to be repaid (or
forthwith in the case of an outstanding Documentary Credit) and
pending such application shall be deposited in an interest bearing
blocked account (the "Blocked Account") in the name of the relevant
Borrower held with the Facility Agent, unless the Obligors' Agent
by not less than five Business Days' written notice to the Facility
Agent has specified that it wishes to make an immediate prepayment
in which case the prepayment shall be made on the date of such
disposal, recovery, listing, sale or issue, as the case may be.
(b) So long as any Utilisation remains outstanding or any of the
Commitments are available for drawing (whether or not subject to
conditions precedent), no amount shall be withdrawn from any
Blocked Account by any member of the Group except for immediate
application in making any required prepayment (which the relevant
Borrower may do by giving five Business Days' written notice to the
Facility Agent) or accelerated repayment of any Utilisation or as
provided in paragraph (c) below.
(c) The Facility Agent shall be entitled (but not obliged) to apply the
whole or any part of the sums standing to the credit of any Blocked
Account in the name of any Obligor in or towards payment of any
unpaid sums then due from that Obligor under this Agreement.
9.9 Miscellaneous provisions
(a) Any notice of prepayment and/or cancellation under this Agreement
is irrevocable. The Facility Agent shall notify the Lenders
promptly of receipt of any such notice.
(b) All prepayments under this Agreement shall be made together with
accrued interest on the amount prepaid.
(c) No prepayment of any Utilisation or cancellation of any Commitment
is permitted except in accordance with the express terms of this
Agreement.
(d) No amount of any Term Advance repaid or prepaid under this
Agreement may subsequently be re-borrowed. No amount of the Total
Commitments cancelled under this Agreement may subsequently be
reinstated.
10. INTEREST
10.1 Interest rate
The rate of interest on each Advance for each Interest Period
relative thereto is the rate per annum determined by the Facility
Agent to be the aggregate of:
(a) the applicable Margin;
(b) the applicable LIBOR; and
(c) the Additional Cost relative to such Advance during such
Interest Period.
10.2 Due dates
Except as otherwise provided in this Agreement, accrued interest on
each Advance for each Interest Period relative thereto shall be
paid by the relevant Borrower on the Interest Date relating to such
Interest Period and also, in the case of a Tranche A Advance or a
Tranche D Advance with an Interest Period of longer than six
months, on the last day of each consecutive period of six months
from the first day of such Interest Period.
10.3 Default interest
(a) If an Obligor fails to pay any amount payable by it under this
Agreement, it shall forthwith on demand by the Facility Agent from
time to time pay interest on the overdue amount from the due date
up to the date of actual payment, as well after as before judgment,
at a rate (the "Default Rate") determined by the Facility Agent to
be one per cent. (1.0%) per annum above the higher of:
(i) the rate of interest on the overdue amount under Clause
10.1 immediately before the due date (if of principal) or
the rate of interest under Clause 10.1 on the principal
amount in respect of which such overdue amount has
accrued due (if of interest); and
(ii) the rate of interest which would have been payable if the
overdue amount had, during the period of non-payment,
constituted a Tranche D Advance,
in each case for successive Interest Periods of such duration as
the Facility Agent may determine having regard to its estimate of
the likely duration of the default (each a "Designated Period").
(b) The Default Rate will be determined on each Business Day or on the
date two Business Days prior to the commencement of or on the first
day of the relevant Designated Period, as the Facility Agent shall
determine, and interest will be compounded at the end of each
Designated Period if not paid.
(c) If the Facility Agent determines that Clause 14 would apply if the
overdue amount were an Advance during the Designated Period, the
rate to be used pursuant to (ii) above will be determined in
accordance with Clause 14.
10.4 Margin Adjustment
(a) If at any time any consolidated annual or quarterly Accounts of the
Group for an Accounting Period ending on or about 30th June or 31st
December in any year delivered to the Facility Agent pursuant to
Clause 21.2(a) or (b) disclose that the ratio of Consolidated EBIT
to Consolidated Net Interest Payable for a period comprising an
annual Accounting Period or four consecutive quarterly Accounting
Periods ending on or after the first anniversary of the Closing
Date is:
(I) greater than 2.50:1 but less than or equal to 3.25:1; or
(II) greater than 3.25:1 but less than or equal to 4.00:1; or
(III) greater than 4.00:1,
then (subject as mentioned below and subject to there being no
outstanding Event of Default at such time) the Margin in respect of
any Tranche A Advance or Tranche D Utilisation shall be reduced
such that if the test in sub-paragraph (I) above is met the Margin
shall be one point six two five per cent. (1.625%) per annum, if
the test in sub-paragraph (II) above is met the Margin shall be one
point three seven five per cent. (1.375%) per annum and if the test
in sub-paragraph (III) above is met the Margin shall be one per
cent. (1.00%) per annum, in each case during (but only during) the
period from (and including) the date on which the Facility Agent
has received the relevant Accounts pursuant to Clauses 21.2(a)(i)
or 21.2(b), as the case may be, and the reports and certificates
relating thereto pursuant to Clause 21.2(d)(i) or (ii), as the case
may be, until (but excluding) the earlier of the following dates:
(i) the date on which the Facility Agent next receives the
relevant Accounts for an annual Accounting Period or four
consecutive quarterly Accounting Periods for an
Accounting Period ending on or about 30th June or 31st
December in any year pursuant to Clauses 21.2(a)(i) or
Clause 21.2(b), as the case may be, and a report and
certificate relating thereto pursuant to Clause
21.2(d)(i) or (ii); or
(ii) the latest date (the "Latest Date") by which the Facility
Agent should have received any such Accounts and
certificates in accordance with the terms of such Clauses
where the Facility Agent has not received the same by
such date;
PROVIDED THAT:
(A) if the Margin has been reduced in reliance on the
unaudited consolidated Accounts of the Group (and
corresponding certificate) for four consecutive quarterly
Accounting Periods together constituting an annual
Accounting Period and the audited consolidated Accounts
of the Group for such annual Accounting Period (and
corresponding report and certificate) do not justify that
reduction, such reduction shall be reversed with
retrospective effect so that the Margin shall be that
justified by the audited consolidated Accounts of the
Group and amounts calculated by reference to the reduced
Margin (whether or not already paid) shall be
recalculated by reference to the Margin justified by such
audited Accounts and the Borrowers shall be required to
make a payment to the Facility Agent to cover any
shortfall in amounts which should have been received by
the Lenders following any such recalculation;
(B) any reduced Margin which would otherwise apply by virtue
of the provisions of this Clause shall be suspended and
the Margin in respect of any Tranche A Advance or Tranche
D Utilisation shall be increased to one point seven five
zero per cent. (1.750%) per annum from the date on which
the Facility Agent gives notice pursuant to Clause 23.2
until the Facility Agent has waived the Event of Default
or the Facility Agent is notified in writing that the
Event of Default is otherwise remedied.
10.5 Determination conclusive; notification
Each determination of a rate of interest by the Facility Agent
under this Agreement shall, in the absence of manifest error, be
conclusive and shall be promptly notified to the Obligors' Agent by
the Facility Agent.
10.6 Lender basis
Interest shall accrue from day to day and be computed on the basis
of a year of 360 days (or 365 days in the case of a sum denominated
in Sterling or Belgian Francs or any other currency in respect of
which interest is customarily calculated on the basis of a year of
365 days in the London Interbank Market) for the actual number of
days elapsed.
11. INTEREST PERIODS
11.1 Selection and agreement
The Obligors' Agent shall give notice to the Facility Agent not
later than 11.00 a.m. on the third Business Day prior to the
commencement of each Interest Period relative to any Advance (or in
the Request therefor) specifying the duration of such Interest
Period, which shall be (i) in respect of the Tranche A Advances and
the Tranche D Advances one, two, three or six months and (ii) in
the case of the Tranche B Advances, Tranche C Advances and Tranche
E Advances six months, or in each case such other duration as may
be agreed by the Facility Agent or as may be required in order to
comply with Clause 11.3 (provided that if such duration is over six
months the Facility Agent may only agree with the unanimous consent
of the Lenders participating in such Advance). If the Obligors'
Agent fails to specify the duration of an Interest Period for any
Tranche A Advance or Tranche D Advance the duration of that
Interest Period shall be one month.
11.2 Splitting
The Obligor's Agent may, in any notice given pursuant to Clause
11.1, split a Tranche A Advance into up to two Tranche A Advances,
provided that one of such Tranche A Advance shall be in an amount
at least equal to the Repayment Instalment due to be repaid with
respect to such Tranche A Advances on the next Repayment Date (and
shall have an Interest Period ending on such Repayment Date). No
more than five Tranche A Advances may be outstanding at any time.
11.3 Restrictions on selection
(a) The Obligors' Agent (on behalf of the relevant Borrower) shall
select the duration of Interest Periods pursuant to Clause 11.1 so
as to ensure that (i) each Tranche A Repayment Date will also be an
Interest Date in relation to an amount of the Tranche A Advances at
least equal to the amount of the Tranche A Repayment Instalment due
to be paid on such Tranche A Repayment Date, (ii) no Tranche B
Advance or Tranche C Advance or Tranche E Advance shall have an
Interest Period expiring after the Final Maturity Date, and (iii)
no Tranche A Advance or Tranche D Advance shall have an Interest
Period expiring after the Final A Repayment Date.
(b) Each of the first three Interest Periods for each of the Tranche A
Advances, the Tranche B Advances and the Tranche C Advances shall
be of one month's duration or such other period as the Facility
Agent may agree with the Obligors' Agent. The fourth Interest
Period for each of the Tranche B Advances and the Tranche C
Advances shall be of three months' duration (or such other period
as the Facility Agent may agree with the Obligors' Agent). The
Interest Periods for any Tranche D Advance or Tranche E Advance
drawn during the first three months after the Closing Date shall be
as specified by the Facility Agent, after consultation with the
Obligors' Agent, in order to facilitate syndication of the
Facilities.
(c) If it appears to the Facility Agent in good faith that the
requirements of paragraphs (a) or (b) above, or that the
requirements of the Original Lenders (in consultation with the
Company) for an orderly primary syndication of the Facilities, will
not be met by the Obligors' Agent's selection of any Interest
Period, the Facility Agent, on behalf of and after consultation to
the extent practicable with the Obligors' Agent, shall select a
different duration for such Interest Period.
11.4 Duration
The (or the first) Interest Period relative to each Advance shall
commence on its Utilisation Date and end on the last day of the
period selected therefor and any subsequent Interest Period
relative to a Term Advance shall commence on the expiry of the
immediately preceding Interest Period relating thereto and end on
the last day of the period so selected therefor, provided that if
any Interest Period would otherwise end on a day which is not a
Business Day, such Interest Period shall end instead on the next
Business Day in the same calendar month (if there is one) or on the
preceding Business Day (if there is not).
11.5 Notification
The Facility Agent will notify the relevant Lenders and the
Obligors' Agent of the duration of each Interest Period relating to
an Advance and of the rate of interest applicable thereto promptly
after ascertaining the same (and such duration and rate shall, in
the absence of manifest error, be conclusive).
12. PAYMENTS
12.1 Funds
(a) Payments under this Agreement to the Facility Agent shall
be made in freely transferable funds for same day value
on the due date at such times and in such manner as the
Facility Agent may specify to the Party concerned as
being customary at the time for the settlement of
transactions in the currency in which the amount
concerned is denominated to the account of the Facility
Agent:
(i) if in Sterling by CHAPS to Sort Code 40-50-88
or to such account at such bank or office as
the Facility Agent shall designate by at least
three Business Days' notice to the Party
liable; and
(ii) if in any Optional Currency, at such bank or
office in the principal financial centre in the
country of such Optional Currency as the
Facility Agent may designate by not less than
three Business Days' notice to the Party
concerned.
(b) Payments by the Obligors shall, unless otherwise
specified in this Agreement, be made to the Facility
Agent for the account of the relevant Party.
12.2 Distribution
(a) Each payment received by the Facility Agent under this Agreement
for another Party shall, subject to paragraphs (b) and (c) below,
be made available by the Facility Agent to that Party by payment
(on the date and in the currency and funds of receipt) to its
account with such bank as it may notify to the Facility Agent for
this purpose by not less than 10 Business Days' prior notice.
(b) The Facility Agent may apply any amount received by it for an
Obligor in or towards payment of any amount due (but unpaid) from
an Obligor under this Agreement.
(c) Where a sum is to be paid under this Agreement to the Facility
Agent for the account of another Party, the Facility Agent is not
obliged to pay that sum to that Party until it has established that
it has actually received that sum. The Facility Agent may, at its
sole discretion, assume that the sum has been paid to it in
accordance with this Agreement and, in reliance on that assumption,
make available to that Party a corresponding amount. If the sum has
not been made available but the Facility Agent has paid a
corresponding amount to another Party, that Party shall forthwith
on demand refund the corresponding amount to the Facility Agent
together with interest on that amount from the date of payment to
the date of receipt by the Facility Agent, calculated at a rate
determined by the Facility Agent to reflect its cost of funds.
12.3 Currency
(a) Interest accrued under this Agreement shall be payable in the
currency in which the relevant amount in respect of which it has
accrued was denominated during the period of accrual.
(b) The principal of each Advance shall be repaid or prepaid in the
currency in which it is denominated when drawn down (subject to
Clause 2.5).
(c) Any amount (other than of principal and/or interest) calculated on
or by reference to or payable in respect of another amount shall be
payable in the currency in which that other amount is denominated
at the time of payment.
(d) Amounts payable in respect of costs, expenses, Taxes and the like
are payable in the currency in which they are incurred.
(e) Any other amount payable under this Agreement is, except as
otherwise provided in this Agreement, payable in Sterling.
12.4 Set-off and counterclaim
All payments to be made by an Obligor under any Senior Finance
Document shall be made without set-off or counterclaim.
12.5 Non-Business Days
(a) If a payment under this Agreement is due on a day which is not a
Business Day, the due date for that payment shall instead be the
next Business Day.
(b) During any extension of the due date for payment of any principal
under this Agreement interest is payable on the principal at the
rate payable on the original due date.
12.6 Partial payments
(a) If the Facility Agent receives a payment insufficient to discharge
all the amounts then due and payable by the Obligors under this
Agreement, the Facility Agent shall apply that payment towards the
obligations of the Obligors in the following order:
(i) first, in or towards payment pro rata of any unpaid costs
and expenses of the Agents under the Senior Finance
Documents;
(ii) secondly, in or towards payment pro rata of any accrued
fees due but unpaid under Clause 25;
(iii) thirdly, in or towards payment pro rata of any accrued
interest due but unpaid under this Agreement;
(iv) fourthly, in or towards payment pro rata of any principal
due but unpaid under this Agreement; and
(v) fifthly, in or towards payment pro rata of any other sum
due but unpaid under this Agreement.
(b) The Facility Agent shall, if so directed by the Majority Lenders,
vary the order set out in sub-paragraphs (a)(ii) to (v) above.
(c) Paragraphs (a) and (b) above shall override any appropriation made
by an Obligor.
12.7 Security Agent as Joint Creditor
(a) Each of the Obligors and each of the Finance Parties agree that the
Security Agent shall be the joint creditor (together with the
relevant Finance Party) of each and every obligation of any Obligor
towards each of the Finance Parties under this Agreement, and that
accordingly the Security Agent will have its own independent right
to demand performance by the relevant Obligor of those obligations.
However, any discharge of any such obligation to one of the
Security Agent or the relevant Finance Party shall, to the same
extent, discharge the corresponding obligation owing to the other.
(b) Without limiting or affecting the Security Agent's rights against
any Obligor (whether under this paragraph or under any other
provision of the Finance Documents), the Security Agent agrees with
each other Finance Party (on a several and divided basis) that,
subject as set out in the next sentence, it will not exercise its
rights as a joint creditor with a Finance Party except with the
consent of the relevant Finance Party. However, for the avoidance
of doubt, nothing in the previous sentence shall in any way limit
the Security Agent's right to act in the protection or preservation
of rights under or to enforce any Security Document as contemplated
by this Agreement, the Priority Agreement and/or the relevant
Security Document (or to do any act reasonably incidental to any of
the foregoing).
13. TAXES
13.1 Gross-up
All payments by an Obligor under the Senior Finance Documents shall
be made without any deduction or withholding and free and clear of
and without deduction or withholding for or on account of any Taxes
except to the extent that the Obligor is required by law to make
payment subject to any Tax. If any Tax or amounts in respect of Tax
must be deducted, or any other deductions must be made or Tax
accounted for, from or in respect of any amounts payable or paid by
an Obligor, or paid or payable by the Facility Agent to a Finance
Party, under the Senior Finance Documents, the Obligor shall pay
such additional amounts (save as referred to in Clause 13.3), as
may be necessary to ensure that the relevant Finance Party receives
a net amount equal to the full amount which it would have received
had payment not been made subject to Tax.
13.2 Tax receipts
All Taxes required by law to be deducted or withheld by an Obligor
from any amounts paid or payable under the Senior Finance Documents
shall be paid by the relevant Obligor when due and the Obligor
shall, within a month of the payment being made, deliver to the
Facility Agent for the relevant Lender evidence satisfactory to
that Lender (including all relevant tax receipts) that the payment
has been duly remitted to the appropriate authority.
13.3 Recognised Lender
(a) If, otherwise than as a result of the introduction of, change in,
or change in the interpretation, administration or application of,
any law or regulation or any practice or concession of any
applicable Tax authority occurring after the date of this
Agreement, a Lender is not or ceases to be a Recognised Lender, no
Obligor shall be liable to pay to that Lender under Clause 13.1 any
amount in respect of Taxes levied or imposed in excess of the
amount it would have been obliged to pay if that Lender had been a
Recognised Lender.
(b) No Obligor is liable to pay to a Lender any amount under Clause
13.1 in respect of Taxes (not being withholding taxes) imposed on
the overall net income or gains of a Lender by the jurisdiction in
which its principal office is located or on the overall net income
or gains of the Lender's Facility Office by the jurisdiction in
which that Facility Office is located.
(c) Each Lender confirms to the Company that on the date of this
Agreement (or if later on the date it becomes a Party to this
Agreement) it is, or prior to the first Interest Date on which
interest is payable to it under this Agreement will be, a
Recognised Lender.
13.4 Tax Saving
(a) If, following the imposition of any Tax on any payment by any
Obligor (or any corresponding payment by the Facility Agent to any
Finance Party under this Agreement) in consequence of which such
Obligor pays an additional amount under Clause 13.1, any Finance
Party shall as a result of such payment receive or be granted a
credit against or remission for or deduction or relief from or in
respect of any Tax payable by it which in such Finance Party's sole
opinion (acting in good faith) is both identifiable and
quantifiable by it without requiring such Finance Party or its
professional advisers to expend a material amount of time or incur
a material cost in so identifying or quantifying (any of the
foregoing, to the extent so identifiable and quantifiable, being
referred to as a "saving"), such Finance Party shall, to the extent
that it can do so without prejudice to the retention of the
relevant saving and subject to such Obligor's obligation to repay
promptly on demand by the Finance Party the amount to such Finance
Party if the relevant saving is subsequently disallowed or
cancelled, reimburse such Obligor promptly after receipt of such
saving by such Finance Party with such amount as such Finance Party
shall in its sole opinion but in good faith have concluded to be
the amount or value of the relevant saving.
(b) Nothing contained in this Agreement shall interfere with the right
of any Finance Party to arrange its Tax and other affairs in
whatever manner it thinks fit. No Finance Party shall be required
to disclose any confidential information relating to the
organisation of its affairs.
13.5 Double tax treaty filings
Each Finance Party shall, and the Company shall ensure that each
relevant Borrower (and if a payment falls or is likely to fall to
be made by it, each Guarantor) shall, file all such forms, make all
such applications and take all such other action, in each case as
it may reasonably be able to file, make or take, pursuant to all
relevant treaties for the avoidance of double taxation in order
that payments by it hereunder to which such treaties apply (or
would apply were such filings, applications or other action made or
taken) may be made without (or, where complete avoidance is not
possible, with a reduced rate of) withholding tax. Each Finance
Party shall give to each relevant Obligor and each relevant Obligor
shall give to each Finance Party such assistance as the other may
reasonably require in connection with the completion and filing of
such forms, the making of such applications and the taking of such
other duties as aforesaid.
13.6 U.S. Taxation - delivery of forms and statements
(a) Each Finance Party which is not a U.S. Person shall, subject as
otherwise provided in Clause 13.6(d), deliver (through the Facility
Agent) to each U.S. Obligor within 21 days of a request from the
Facility Agent, duly completed, two copies of such form or forms as
may be required to indicate that such Finance Party is entitled to
receive payments under this Agreement without deduction,
withholding or payment by the U.S. Obligor of any United States
federal Taxes, including, without limitation, either:
(i) two copies of Form 1001 of the Internal Revenue Service
of the United States of America (relating to an
applicable double revenue tax treaty concluded by the
United States of America); or
(ii) two copies of Form 4224 of the Internal Revenue Service
of the United States of America (relating to income
effectively connected with the conduct of a trade or
business in the United States of America); or
(iii) two copies of Form W.8 of the Internal Revenue Service of
the United States of America (relating to the
certification by a Finance Party of non United States
status).
Each such Finance Party, subject as otherwise provided in Clause
13.6(d), shall deliver (through the Facility Agent) to each U.S.
Obligor additional duly completed copies of any of the above forms
and/or such additional or successor forms as shall be adopted from
time to time by the Internal Revenue Service of the United States
of America if it is notified by the U.S. Obligor or the Internal
Revenue Service of the United States of America that any previous
such form delivered by it pursuant to this Clause 13.6 has expired
or that Finance Party becomes aware that any such form shall have
become incomplete or inaccurate in any respect unless prior to that
delivery any event occurs which renders the relevant form
inapplicable.
(b) Each Finance Party which is a U.S. Person shall deliver (through
the Facility Agent) to each U.S. Obligor a statement signed by an
authorised signatory of the Finance Party to the effect that it is
a U.S. Person and if necessary to avoid United States backup
withholding, a duly completed copy of Internal Revenue Service Form
W-9 (or successor form) establishing that such Finance Party is not
subject to United States backup withholding.
(c) The Facility Agent shall have no responsibility or liability for
and no obligation to check the accuracy or appropriateness of any
form or statement delivered by any Finance Party pursuant to Clause
13.6(a) or (b) respectively.
(d) If any Finance Party determines, as a result of any change in
applicable law, regulation or treaty, or in any official
application or interpretation thereof, that it is unable to submit
to any U.S. Obligor any form or certificate that the Finance Party
is obliged to submit pursuant to Clause 13.6(a) or 13.6(b), or that
such Finance Party is required to withdraw or cancel any form or
certificate previously submitted, the Finance Party shall promptly
notify each U.S. Obligor of that fact.
14. MARKET DISRUPTION
(a) If, in relation to any Advance:
(i) no, or (where there is more than one Reference Bank) only
one, Reference Bank supplies a rate for the purposes of
determining the applicable LIBOR (where LIBOR is being
determined pursuant to paragraph (b) of that definition)
or the Facility Agent otherwise determines that adequate
and fair means do not exist for ascertaining the
applicable LIBOR; or
(ii) the Facility Agent receives notification from Lenders
whose participations in an Advance exceed fifty per cent.
(50%) by value of that Advance that, in their opinion, by
reason of circumstances affecting the London Interbank
Market:
(A) matching deposits will not be available to them
in the London Interbank Market in the ordinary
course of business in amounts sufficient to
fund their participations in that Advance for
the relevant Interest Period; or
(B) the cost to them of such matching deposits in
the London Interbank Market for that Interest
Period would be in excess of the applicable
LIBOR,
the Facility Agent shall promptly notify the Obligors' Agent and
the Lenders of that fact and that this Clause 14 is in operation.
(b) After any notification under paragraph (a) above:
(i) if Clause 14(a)(ii)(A) applies, no further Requests may
be delivered and no Lender shall be obliged to
participate in the Advance to which such notification
relates, unless such Advance is already outstanding,
until the Facility Agent notifies the Obligors' Agent
that the event specified in the notification no longer
prevails;
(ii) if the Obligors' Agent so requires, within five Business
Days of receipt of any such notification, the Obligors'
Agent and the Facility Agent (on behalf of the Lenders)
shall, in good faith, enter into negotiations for a
period of not more than 30 days with a view to agreeing a
substitute basis (the "Substitute Basis") for determining
the rate of interest and/or funding applicable to any
future Advance and to maintaining any existing Advances
to which such notification relates;
(iii) any Substitute Basis agreed under sub-paragraph (ii)
above shall be, with the prior consent of all the
Lenders, binding on all the Parties; and
(iv) until and unless a Substitute Basis is so agreed, each
Lender's participation in each outstanding Advance to
which such notification related shall bear interest
during the current Interest Period relative thereto at
the rate certified by such Lender to be its cost of funds
(from such source as it may reasonably select) for such
Interest Period in relation to such Advance, plus the
applicable Margin.
(c) The Facility Agent, in consultation with the Obligors' Agent shall,
not less often than monthly, review whether or not the
circumstances referred to in Clause 14(a) still prevail with a view
to returning to the normal interest provisions of this Agreement.
15. INCREASED COSTS
15.1 Increased costs
(a) Subject to Clause 15.2 (Exceptions), the Company shall forthwith on
demand by a Finance Party pay (or procure that there is paid to)
that Finance Party the amount of any increased cost incurred by it
(or any Holding Company of it) as a result of the introduction of
or change in or change in the interpretation, administration or
application of any law, directive or regulation (including any law
or regulation relating to taxation, change in currency of a country
or reserve asset, special deposit, cash ratio, liquidity or capital
adequacy requirements or any other form of banking or monetary
control) whether or not having the force of law but, if not, being
a directive or regulation with which it is the practice of banks in
the relevant jurisdiction to comply or compliance by any Finance
Party (or any Holding Company of such Finance Party) with any such
introduction or change.
(b) In this Agreement "increased cost" means:
(i) an additional cost incurred by a Finance Party (or any
Holding Company of it) as a result of it having entered
into, or performing, maintaining or funding its
obligations under, any Senior Finance Document or
Documentary Credit; or
(ii) that portion of an additional cost incurred by a Finance
Party (or any Holding Company of it) in making, funding
or maintaining all or any advances, letters of credit or
guarantees comprised in a class of advances, letters of
credit or guarantees formed by or including the
participations in the Advances or Documentary Credits
made or to be made under this Agreement which is
attributable to it making, funding or maintaining those
participations; or
(iii) a reduction in any amount payable to a Finance Party (or
any Holding Company of it) or the effective return to a
Finance Party (or any Holding Company of it) under any
Finance Document or on its (or such Holding Company's)
capital; or
(iv) the amount of any payment made by a Finance Party (or any
Holding Company of it), or the amount of interest or
other return foregone by a Finance Party (or any Holding
Company of it), calculated by reference to any amount
received or receivable by a Finance Party from any other
Party under this Agreement.
15.2 Exceptions
Clause 15.1 does not apply to any increased cost:
(a) compensated for by the operation of Clause 13 (or which
would have been so compensated for but for the operation
of Clause 13.3(a)) or Clause 10.1(c);
(b) attributable to any change in the rate of tax on the
overall net income or gains of a Lender imposed in the
jurisdiction in which its principal office is located or
on the overall net income or gains of the Lender's
Facility Office by the jurisdiction in which that
Facility Office is located; or
(c) attributable to any penalty having been imposed by the
relevant central bank or other monetary authority upon
the affected Finance Party by virtue of its having
exceeded any country or sector borrowing limits or broken
any directives imposed upon it prior to entering into
this Agreement or becoming a party to it.
15.3 Regulation D Compensation
Unless such additional interest is paid in accordance with Clause
10.1(c) any Lender which is required by Regulation D issued by the
Board of Governors of the Federal Reserve System of the USA to
maintain and does maintain any reserves against "Eurocurrency
liabilities" (as defined in such Regulation) pursuant to such
Regulation may require any U.S. Obligor to pay, contemporaneously
with each payment of interest on any Advance (in respect of which
the Eurodollar Reserve Percentage applies) made to such U.S.
Obligor for any Interest Period relative thereto, additional
interest on the participation of such Lender in that Advance at the
rate per annum determined from the formula (A)(i) LIBOR applicable
to such Advance for that Interest Period divided by (ii) one minus
the Euro-Dollar Reserve Percentage minus (B) LIBOR applicable to
such Advance for that Interest Period. Any Lender requiring payment
by any U.S. Obligor of such additional interest shall notify such
U.S. Obligor and the Facility Agent at least five Business Days
prior to the last day of each Interest Period for each relevant
Advance of the amount due to be paid to it with respect to such
Advance pursuant to this Clause 15.3 (certifying in that notice
that the amount claimed does not exceed such part of the cost to
such Lender of maintaining such reserves as in the opinion of that
Lender should fairly and reasonably be apportioned to such
Advance), which notice shall be final and binding in the absence of
manifest error. No Lender shall be required to disclose in support
of any claim hereunder any information reasonably regarded by such
Lender as being confidential.
16. ILLEGALITY
16.1 Illegality
If it becomes (or any change in the interpretation, administration
or application of any law or regulation makes it apparent that it
is) unlawful in any applicable jurisdiction or contrary to any
applicable regulation (if not having the force of law, being one
which it is the practice of banks, trusts or financial institutions
in the relevant jurisdiction to comply), for a Finance Party to
give effect to any of its obligations as contemplated by this
Agreement or to fund or maintain its participation in any
Utilisation then:
(a) the Finance Party may notify the Obligors' Agent through
the Facility Agent accordingly;
(b) (i) each Borrower shall forthwith or by such later
date as is immediately prior to the illegality
taking effect prepay that Finance Party's
participation in all Utilisations (including,
without limitation, any such participation by
virtue of Clause 5.7) made to it together with
all other amounts payable by it to that Finance
Party under this Agreement; and
(ii) such Finance Party's Commitments shall be
cancelled and (save for its obligations under
Clause 5.7) the obligations of the Finance
Party to the Obligors hereunder shall cease;
(c) if the unlawfulness referred to in this Clause 16 relates
only to Utilisations made available to a particular
Borrower, under a particular Facility or in a particular
currency, the Borrower shall only be obliged to prepay
Utilisations in respect of that Borrower, Facility and/or
currency and the obligation of the Lenders to make
facilities available to that Borrower shall be cancelled
and discharged in each case only to the extent necessary
or desirable to remove, remedy or mitigate the
unlawfulness; and
(d) the affected Lender's Commitments shall not, however, be
cancelled if:
(i) the affected Borrower makes the prepayment of
its Utilisations referred to in this Clause 16;
and
(ii) any other Borrower is entitled, subject to the
terms of this Agreement, to make a Utilisation
in an amount equal to or less than the amount
so prepaid under the terms of this Clause 16;
and
(iii) such affected Lender, in its opinion after
taking such advice as it considers appropriate
and consistent with its existing internal
credit sanction in relation to this Agreement
and in accordance with its usual policies,
could lawfully give effect to its obligations
as contemplated by this Agreement and fund and
maintain its participations in the proposed
Utilisations to other Borrowers.
If this Clause 16.1(d) applies the Facility Agent and the Obligors'
Agent, each acting in good faith, will use their reasonable
endeavours to agree any necessary changes to this Agreement.
17. MITIGATION
17.1 Mitigation
If Clauses 13, 14, 15 or 16 operate in relation to any Finance
Party to the detriment of any Borrower then, without in any way
limiting, reducing or otherwise qualifying the obligations of the
Obligors under Clauses 13, 14, 15 or 16, the Facility Agent or such
Lender, as the case may be, shall upon written request from such
Obligor, take such steps as may be reasonably practical to mitigate
the effect of those circumstances including (without limitation)
submitting all forms required by a national taxation authority in
connection with the payment of gross sums under any applicable
double tax treaty, the transfer of its Facility Office to another
jurisdiction or the transfer and assignment of all its rights and
obligations hereunder to another bank or financial institution,
which is willing to participate in the Facilities in its place,
provided that neither the Facility Agent nor the Finance Party
concerned shall be under any obligation to submit any such forms or
to make any such transfer or assignment and transfer to another
bank or financial institution if, in its opinion, it would or might
have an adverse effect upon its business, operations or financial
condition or the management of its tax affairs or cause it to incur
any material costs or expenses which might not be reimbursed
pursuant to Clause 17.3 and nothing in this Clause shall require
any Finance Party to disclose any confidential information relating
to its business or tax affairs.
17.2 Transfer
If Clauses 13, 14, 15 or 16 apply, the Obligors' Agent shall be
entitled to request one or more of the other Lenders, or designate
a replacement lender, to accept the transfer of all or a rateable
part of the affected Finance Party's Commitments and participations
in outstanding Utilisations in accordance with Clause 30. If one or
more Lenders, or a replacement lender (a "willing transferee") is
willing to accept such a transfer and comply with Clause 30 in
respect of such transfer then, subject only to the consent of the
Facility Agent, the affected Lender shall be obliged to transfer by
means of a Substitution Certificate at par and against payment in
full in cash all or such part of its rights and obligations under
the Finance Documents (being a rateable part of its Commitment and
its participation in outstanding Utilisations) as one or more
willing transferees will accept.
17.3 Costs and Expenses
Any reasonable costs and expenses incurred by any Finance Party
pursuant to this Clause 17 shall be paid by the Obligors' Agent
within five Business Days after receipt of a demand specifying the
same in reasonable detail.
18. GUARANTEE
18.1 Guarantee
Each Guarantor irrevocably, unconditionally, jointly and severally:
(a) as principal obligor, and not merely as surety,
guarantees to each Finance Party prompt performance by
each other Obligor of all its obligations under the
Senior Finance Documents and the payment when due of all
sums from time to time payable by each other Obligor;
(b) undertakes with each Finance Party that whenever a
Borrower does not pay any amount when due under or in
connection with any Senior Finance Document, that
Guarantor shall forthwith on demand by the Facility Agent
pay that amount as if that Guarantor instead of the
relevant Borrower were expressed to be the principal
obligor; and
(c) indemnifies each Finance Party on demand against any loss
or liability suffered by such Finance Party if any
obligation guaranteed by that Guarantor is or becomes
unenforceable, invalid or illegal,
subject in the case of any Additional Guarantor to applicable law
and to any limitation specified in the Guarantor Accession
Agreement by which it became a party to this Agreement.
18.2 Continuing guarantee
This guarantee is a continuing guarantee and will extend to the
ultimate balance of all sums payable by the Obligors or any of them
under the Senior Finance Documents, regardless of any intermediate
payment or discharge in whole or in part.
18.3 Reinstatement
(a) Where any discharge (whether in respect of the obligations of any
Obligor or any security for those obligations or otherwise) is made
in whole or in part or any arrangement is made on the faith of any
payment, security or other disposition which is avoided or must be
restored on insolvency, liquidation or otherwise without
limitation, the liability of each Guarantor under this Clause 18
shall continue as if the discharge or arrangement had not occurred.
(b) Each Finance Party may concede or compromise any claim that any
payment, security or other disposition is liable to avoidance or
restoration.
18.4 Waiver of defences
The obligations of each Guarantor under this Clause 18 will not be
affected by any act, circumstance, omission, matter or thing which,
but for this provision, would reduce, release or prejudice any of
its obligations under this Clause 18 or prejudice or diminish those
obligations in whole or in part, including without limitation
(whether or not known to it or any other Party):
(a) any time, indulgence or waiver granted to, or composition
with, any Obligor or other person;
(b) the taking, variation, compromise, exchange, renewal or
release of, or refusal or neglect to perfect, take up or
enforce, any rights or remedies against, or security over
assets of, any Obligor or other person or any
non-presentation or non-observance of any formality or
other requirement in respect of any instrument or any
failure to realise the full value of any security;
(c) any legal limitation, disability, incapacity or lack of
powers, authority or legal personality of or dissolution
or change in the members or status of any Obligor or any
other person;
(d) any variation (however fundamental and whether or not
involving an increase in liability of any Obligor) or
replacement of a Finance Document or any other document
or security so that references to that Finance Document
in this Clause 18 (Guarantee) shall include each
variation or replacement;
(e) any unenforceability, illegality, invalidity or
frustration of any obligation of any person under any
Finance Document or any other document or security or any
failure of any Obligor or proposed Obligor to become
bound by the terms of any Finance Document;
(f) any postponement, discharge, reduction, non-provability
or other similar circumstance affecting any obligation of
any Obligor under a Finance Document resulting from any
insolvency, liquidation or dissolution proceedings or
from any law, regulation or order,
so that each such obligation shall, for the purposes of the
Guarantor's obligations under this Clause 18, remain in full force
and be construed as if there were no such act, circumstance,
variation, omission, matter or thing.
18.5 Immediate recourse
Each Guarantor waives any right it may have of first requiring any
Finance Party (or any trustee or agent on its behalf) to proceed
against or enforce any other rights or security or claim payment
from or file any proof or claim in any insolvency proceedings of
any person before claiming from that Guarantor under this Clause
18.
18.6 Appropriations
Until all amounts which may be or become payable by the Obligors
under or in connection with the Finance Documents have been
irrevocably paid in full, each Finance Party (or any trustee or
agent on its behalf) may:
(a) refrain from applying or enforcing any other moneys,
security or rights held or received by that Finance Party
(or any trustee or agent on its behalf) in respect of
those amounts, or apply and enforce the same in such
manner and order as it sees fit (whether against those
amounts or otherwise) and no Guarantor shall be entitled
to the benefit of the same; and
(b) hold in an interest bearing suspense account any moneys
received from any Guarantor or on account of any
Guarantor's liability under this Clause 18.
18.7 Non-competition
Until all amounts which may be or become payable by the Obligors
under or in connection with the Finance Documents have been
irrevocably paid in full, no Guarantor shall, after a claim has
been made or by virtue of any payment or performance by it under
this Clause 18:
(a) be subrogated to any rights, security or moneys held,
received or receivable by any Finance Party (or any
trustee or agent on its behalf) or be entitled to any
right of contribution or indemnity in respect of any
payment made or moneys received on account of that
Guarantor's liability under this Clause 18 and, to the
extent that any Guarantor is so subrogated or entitled by
law, that Guarantor (to the fullest extent permitted by
law) waives and agrees not to exercise or claim those
rights, security or money or that right of contribution
or indemnity;
(b) claim, rank, prove or vote as a creditor of any Obligor
or its estate in competition with any Finance Party (or
any trustee or agent on its behalf) unless otherwise
required by the Facility Agent or by law (in which case
any proceeds of any claim in respect of any rights,
security or monies of any Finance Party to which such
Guarantor was subrogated will be paid by such Guarantor
to the Facility Agent to be applied in accordance with
the provisions of the Senior Finance Documents); or
(c) receive, claim or have the benefit of any payment,
distribution or security from or on account of any
Obligor, or exercise any right of set-off as against any
Obligor (and without prejudice to the foregoing, each
Guarantor shall forthwith pay to the Facility Agent for
the benefit of the Finance Parties an amount equal to any
amount so set-off by it).
Each Guarantor shall hold in trust for and forthwith pay or
transfer to the Facility Agent for the Finance Parties any payment
or distribution or benefit of security received by it contrary to
this Clause 18.7.
18.8 Additional security
This guarantee is in addition to and is not in any way prejudiced
by any other security now or hereafter held by any Finance Party.
18.9 Limitations
Notwithstanding any other provision of this Clause 18:
(a) the obligations of each U.S. Obligor in its capacity as a
Guarantor under this Clause 18 shall be limited to a
maximum aggregate amount equal to the greater of (A) two
thirds of the amount by which the fair saleable value of
the property of such Guarantor from time to time exceeds
the total liabilities of such Guarantor (including
contingent liabilities, but excluding the obligations of
such Guarantor hereunder) from time to time and (B) the
largest amount that would not render its obligations
hereunder subject to avoidance as a fraudulent transfer
or conveyance under Section 548 of Title 11 of the United
States Bankruptcy Code or any applicable provisions of
comparable state law (collectively, the "Fraudulent
Transfer Laws"), in each case after giving effect to all
other liabilities of such U.S. Obligor, contingent or
otherwise, that are relevant under the Fraudulent
Transfer Laws (specifically excluding, however, any
liabilities of such U.S. Obligor in respect of
intercompany indebtedness to the Borrowers or Affiliates
of the Borrowers to the extent that such indebtedness
would be discharged in an amount equal to the amount paid
by such U.S. Obligor hereunder) and after giving effect
as assets to the value (as determined under the
applicable provisions of the Fraudulent Transfer Laws) of
any rights to subrogation, contribution, reimbursement,
indemnity or similar rights of such U.S. Obligor pursuant
to (i) applicable law or (ii) any agreement providing for
an equitable allocation among such U.S. Obligor and other
Affiliates of the Borrowers of obligations arising under
guarantees by such parties;
(b) the obligations of any company incorporated in Canada in
its capacity as a Guarantor under this Clause 18 shall be
limited to guaranteeing only the liabilities of each
other Obligor (i) which is a subsidiary (as defined
below) of that company or (ii) of which that company is a
wholly owned subsidiary (as defined below). For the
purposes of this Clause 18.9(b) only, a company is a
"wholly owned subsidiary" of another company if (A) all
of its issued shares are held by (I) that other company,
(II) that other company and other bodies corporate
wherein that other company holds all of the shares of the
other bodies corporate, or (III) two or more bodies
corporate wherein that other company holds all of the
shares of such bodies corporate, or (B) it is a wholly
owned subsidiary of a body corporate that is a wholly
owned subsidiary of that other company. For the purposes
of this Clause 18.9(b) only a "subsidiary" of another
company shall be any body corporate that (A) is
controlled by (I) it, (II) it and other bodies corporate
which it also controls, or (III) two or more bodies
corporate each of which is controlled by it; or (B) is a
subsidiary of a body corporate that is its subsidiary.
19. Additional Borrowers, GuaraNtors and Security
19.1 Additional Borrowers
(a) If any wholly-owned Subsidiary of the Company wishes to become a
Borrower, it and the Obligors' Agent (for itself and on behalf of
the existing Borrowers and Guarantors) shall execute and deliver to
the Facility Agent a duly completed Borrower Accession Agreement.
(b) If:
(i) all the Lenders confirm to the Facility Agent their
agreement to the relevant Subsidiary becoming a Borrower;
or
(ii) in the case of a Subsidiary becoming a Borrower on or
prior to Closing, if such Subsidiary is specified in
Schedule 7 Part IV; or
(iii) such Subsidiary is an operating company incorporated in
the United States of America, Canada or England and
Wales,
the Facility Agent shall execute such Borrower Accession Agreement
for itself and on behalf of the other Finance Parties.
(c) Subject to Clause 19.1(d), upon execution of such Borrower
Accession Agreement by the relevant Subsidiary as Additional
Borrower, the Obligors' Agent and the Facility Agent as aforesaid,
such Subsidiary shall become an Additional Borrower in accordance
with the terms hereof and thereof. If included in the Borrower
Accession Agreement, the Additional Borrower's right to make
Utilisations hereunder may be limited in accordance with the terms
so included.
(d) The obligations of the Finance Parties to such Additional Borrower
with respect to the making of the first Utilisation to it under
this Agreement are subject to the condition precedent that the
Lenders shall have received in form and substance satisfactory to
it each of the documents listed in Schedule 3 Part IV and such
other reports, opinions and other documents relating to such
Additional Borrower as the Facility Agent may reasonably require.
19.2 Additional Guarantors
(a) The Obligors shall procure that, subject to any provision of law
prohibiting the relevant person from becoming an Additional
Guarantor:
(i) the companies or corporations identified in Schedule 7
Part III shall on or as soon as practicable after the
Closing Date each become an Additional Guarantor, and the
Company shall deliver or shall procure that there is
delivered to the Facility Agent all of the documents set
out in Schedule 3 Part III in the agreed form, and each
of the documents referred to in Schedule 3 Part III as
being certified shall be certified by a director of the
Obligor's Agent on behalf of the party providing that
document as being a true, complete and up to date copy
and in full force and effect as at the date such document
is required to be delivered and the Obligors will use all
reasonable endeavours to procure that such companies and
corporations shall become an Additional Guarantor as soon
as practicable after Closing;
(ii) any Additional Borrower (other than Dunlop Aerospace
Limited which shall become an Additional Guarantor as
soon as practicable after Closing) shall at the same time
become an Additional Guarantor;
(iii) Fasco Motors will, if on the Closing Date its gross
assets exceed(pound)500,000, become an Additional
Guarantor;
(iv) Dunlop Investments will become an Additional Guarantor on
or before Closing;
(v) Dutchco will, prior to the acquisition by it of any
assets, the commencement of trading by it or the transfer
to it of any assets belonging to any member of the Group
including, without limitation, the transfer of the entire
issued share capital of BTR Aerospace B.V. and/or BTR
Vliegwiel B.V. as contemplated in the Supplemental
Structure Memorandum, become an Additional Guarantor; and
(vi) any Material Group Subsidiary and any Subordinated
Borrower and if there has, in the opinion of the Majority
Lenders, been a material and adverse change in the
business, assets or financial condition of any Material
Group Subsidiary any other member of the Group shall
become, as soon as possible after being required by the
Facility Agent on the instructions of the Majority
Lenders to become, an Additional Guarantor.
Each such company or corporation shall become an Additional
Guarantor by (A) executing and delivering to the Facility Agent a
Guarantor Accession Agreement (duly executed by the Obligors' Agent
for itself and on behalf of the existing Borrowers and Guarantors)
and (B) delivering to the Facility Agent each of the documents
listed in Schedule 3 Part IV (or in the case of the companies and
corporations listed in Schedule 7 Part III each of the documents
listed in Schedule 3 Part III) and such other reports, opinions and
documents (if any) as the Facility Agent may reasonably require in
respect of the Additional Guarantor, in order to satisfy itself as
to the efficacy of the Guarantor Accession Agreement each in form
and substance reasonably satisfactory to the Facility Agent.
(b) Where any such prohibition as is referred to above exists, each
Obligor shall use its reasonable endeavours lawfully to overcome
the prohibition.
19.3 Additional Security
(a) The Obligors shall procure that (i) (A) the Security Documents
specified in Schedule 7 Part I are executed and delivered to the
Security Agent on or prior to the Signing Date and (B) (subject in
the case of any member of the Target Group incorporated in England
and Wales to any provision of law prohibiting such member of the
Target Group from giving such security) the Security Documents
specified in Schedule 7 Part II are executed and delivered to the
Security Agent where identified in Schedule 7 Part II prior to
Closing and otherwise as soon as practicable after Closing and (C)
following the acquisition by Dunlop Aerospace Limited of the entire
issued share capital of Dunlop Standard Aerospace (US) Inc. as
contemplated in the Structure Memorandum, Dunlop Aerospace Limited
will deliver to the Security Agent executed but undated stock
transfer forms and share certificates in respect of all the shares
in Dunlop Standard Aerospace (US) Inc. and a share charge over the
shares of Dunlop Standard Aerospace (US) Inc. in substantially the
same form as the share charge referred to in paragraph 2 of
Schedule 7 Part I and (D) prior to the acquisition by Dutchco of
any assets, the commencement of trading by Dutchco or the transfer
to it of any assets belonging to any member of the Group, Dunlop
Standard Aerospace Overseas Limited will deliver to the Security
Agent a share charge over the shares of Dutchco in substantially
the same form as the share charge referred to in paragraph 1 of
Schedule 7 Part II under the heading "The Netherlands (Dutch Law)"
and (E) following the acquisition by Dutchco of the entire issued
share capital of BTR Aerospace B.V. and BTR Vliegwiel B.V. as
contemplated in the Supplemental Structure Memorandum, Dutchco will
deliver to the Security Agent a share charge over the shares of BTR
Aerospace B.V. and BTR Vliegwiel B.V. in substantially the same
form as the share charge referred to in paragraph 1 of Schedule 7
Part II under the heading "The Netherlands (Dutch Law)", and (F)
following the acquisition by, or issue to, Dunlop Investments of
some or all of the issued share capital of Dutchco as contemplated
in the Supplemental Structure Memorandum, Dunlop Investments will
deliver to the Security Agent a share charge over the shares of
Dutchco held by it in substantially the same form as the share
charge referred to in paragraph 1 of Schedule 7 Part III under the
heading "The Netherlands (Dutch Law)" and (ii) on acquiring any
asset which is deemed by the Majority Lenders to be of material
value, or material to the operation of the business of any Obligor,
the Obligor acquiring such asset shall (if such asset is not, in
the opinion of the Security Agent, subject to a charge under any
existing Security Document and in accordance with the Agreed
Security Principles) execute and deliver to the Security Agent such
further or additional Security Documents in relation to such assets
as the Majority Lenders may reasonably require in substantially the
same terms as the Security Documents (if any) charging similar
assets entered into at Closing, and (iii) if there has, in the
opinion of the Majority Lenders, been a material and adverse change
in the business, assets or financial condition of any Material
Group Subsidiary, such Material Group Subsidiary shall execute and
deliver to the Security Agent such further or additional Security
Documents in such form and in relation to such of its assets as the
Majority Lenders shall reasonably require, subject in each case to
any provisions of law or regulation (having the force of law)
prohibiting such person from entering into such Security Documents.
(b) The Obligors shall procure that any entity which becomes a Material
Group Subsidiary (other than, if it becomes a Material Group
Subsidiary, Standard Aero (San Antonio) Inc. for so long only as
prohibited from giving security) after Closing and any Subordinated
Borrower shall execute and deliver to the Security Agent such
Security Documents in relation to its assets in substantially the
same terms as the Security Documents entered into at Closing
subject to any provision of law prohibiting such person from
entering into such Security Documents.
(c) Where a wholly owned Subsidiary of the Company becomes an
Additional Borrower pursuant to Clause 19.1(b) the Obligors shall
procure that such Subsidiary shall execute and deliver to the
Security Agent such Security Documents in relation to its assets in
substantially the same terms as the Security Documents entered into
at Closing subject to any provision of law prohibiting such person
from entering into such Security Documents.
(d) Where any such prohibition as is referred to above exists, the
Obligors shall use their reasonable endeavours lawfully to overcome
the prohibition.
(e) The Obligors shall at their own expense execute and do all such
assurances, acts and things as the Security Agent may reasonably
require (subject to the Agreed Security Principles) for (i)
perfecting or protecting the security intended to be afforded by
the Security Documents (and shall deliver to the Security Agent
such constitutional documents, directors and shareholders
resolutions, title documents and other documents as the Security
Agent may reasonably require) or (ii) facilitating the realisation
of all or any part of the assets which are subject to the Security
Documents and the exercise of all powers, authorities and
discretions vested in the Security Agent or in any receiver of all
or any part of those assets.
(f) Dunlop Investments and Dutchco shall at their own expense
re-execute the pledges of shares of Dutchco, BTR Aerospace B.V. and
BTR Vliegwiel B.V. referred to in Schedule 7 Part II not more than
once at the request of the Facility Agent following syndication of
the Facilities.
(g) Following the merger of Canadaco with BTR Canada Inc. and Standard
Aero Limited, the resulting entity will, and the Company shall
procure that any resulting entity will, if required by the Security
Agent, execute such further or additional Security Documents as the
Security Agent shall reasonably require in relation to such
entity's assets in substantially the same terms as the Security
Documents entered into at Closing.
19.4 Release of Guarantors and Security
(a) Subject to Clause 19.4(c), at the time of completion of any sale or
other disposal to a person or persons outside (and which will
remain outside) the Group of all of the shares in the capital of
any Guarantor (or of all of the shares in any other member of the
Group such that any Guarantor ceases as a result thereof to be a
member of the Group) and in such other circumstances (if any) as
all the Lenders may from time to time agree in writing, such
Guarantor shall be released from all past, present and future
liabilities (both actual and contingent and including, without
limitation, any liability to any other Guarantor by way of
contribution) hereunder and under the Security Documents to which
it is a party (other than liabilities which it has in its capacity
as a Borrower), and the security provided over its assets under
such Security Documents shall be released.
(b) Subject to Clause 19.4(c), at the time of completion of any sale or
other disposal to a person or persons outside (and which will
remain outside) the Group of any assets owned by an Obligor over
which security has been created by the Security Documents to which
that Obligor is party, those assets shall be released from such
security.
(c) The release of the guarantees and security referred to in Clause
19.4(a) and (b) shall only occur (save to the extent otherwise
agreed by all the Lenders) if:
(i) either (1) such disposal by any member of the Group is
permitted in accordance with Clause 21.8 or otherwise
expressly by the provisions of this Agreement and will
not result directly or indirectly in any breach of any of
the terms of this Agreement, or (2) such disposal is of
assets (not being shares in any Obligor) of any member of
the Group and is approved in writing by Lenders the
aggregate of whose Commitments represent by value at
least 75 per cent. (75%) of the Total Commitments or is
of assets (not being shares) the Net Proceeds of which
are less than (pound)100,000, or (3) such disposal is
being effected at the request of the Majority Lenders in
circumstances where any of the security created by the
Security Documents has become enforceable, or (4) such
disposal is being effected by enforcement of the Security
Documents; and
(ii) if required by Clause 9.5 an amount equal to the amount
of the Net Proceeds arising out of such disposal will be
applied in prepayment of the Utilisations; and
(iii) any assets to be transferred to other members of the
Group before completion of such disposal shall have been
so transferred and (if so required by the Majority
Lenders and if a security interest existed over such
assets prior to transfer) security over such assets shall
have been granted to the Security Agent to its
satisfaction.
The Security Agent shall (at the expense of the relevant Obligor)
execute such documents effecting such release as shall be
reasonably required to achieve such release as aforesaid (and the
Security Agent shall execute such documents promptly upon (and only
upon) it being satisfied that the conditions in (i), (ii) and (iii)
above are satisfied or all the Lenders have otherwise agreed).
(d) If any person which is a member of the Group shall cease to be such
a member in consequence of the enforcement of any of the Security
Documents or in consequence of a disposal of the shares therein or
in any Holding Company of it effected at the request of the
Majority Lenders in circumstances where any of the security created
by the Security Documents has become enforceable, any claim which
any Obligor may have against such person or any of its Subsidiaries
or which that person or any of its Subsidiaries may have against
any Obligor in or arising out of this Agreement or any of the
Security Documents (including, without limitation, any claim by way
of subrogation to the rights of the Agents and the Lenders under
the Senior Finance Documents and any claim by way of contribution
or indemnity) shall be released automatically and immediately upon
such person ceasing to be a member of the Group.
20. REPRESENTATIONS AND WARRANTIES
20.1 Representations and warranties
Each Obligor makes the representations and warranties set out in
this Clause 20 to each Finance Party (in the case of an Obligor
which is not the Company, in respect of itself and (where required)
its Subsidiaries only). The representations and warranties in
Clauses 20.1(h) - 20.1(k) (in each case inclusive), (m), (n) and
(s) shall be subject to any matter fairly and adequately disclosed
to the Finance Parties in the Disclosure Letter.
(a) Status:
(i) It is, and each Subsidiary of it is or, in the
case of Dutchco, will be, shortly after
Closing, a limited liability company (or in the
case of Dutchco a limited liability
partnership), duly incorporated and validly
existing under the laws of the jurisdiction of
its incorporation, with the power to own its
assets and carry on its business in all
material respects as it is being conducted; and
(ii) on or prior to the Closing Date no
administrator, receiver, liquidator, custodian,
trustee or similar official has been appointed
with respect to it or any of its assets who has
not been released or discharged from such
appointment and no petition or proceeding for
such an appointment is pending.
(b) Powers and authority: It has the power to enter into, and
has taken all necessary action to authorise the entry
into and delivery by it of, the Transaction Documents to
which it is or will be a party and the transactions
contemplated by those Transaction Documents.
(c) Legal validity: Subject to the Reservations, each
Transaction Document to which it is or will be a party
constitutes, or when executed in accordance with its
terms will constitute, its legal, valid and binding
obligation and no limit on its powers will be exceeded as
a result of the borrowings, grant of security or giving
of guarantees contemplated by the Transaction Documents
to which it is a party.
(d) Non-conflict: The entry into and performance by it of,
and the transactions contemplated by, the Transaction
Documents do not and will not:
(i) conflict in any material respect with any law
or judicial or official regulation applicable
to it; or
(ii) conflict with its constitutional documents; or
(iii) conflict in any respect with, or entitle any
third party to terminate, any agreement or
document which is binding upon it, any other
member of the Group or any asset of any member
of the Group in a manner or to an extent which
might have a Material Adverse Effect or would
or would be reasonably likely to have a
material adverse effect on the business, assets
or financial condition of the Company, any
Borrower or any Material Group Subsidiary or in
a manner or to an extent which could result in
any liability on the part of any Finance Party
to any third party.
(e) No default:
(i) No Default is outstanding or is reasonably
likely to result from the making of any
Utilisation; and
(ii) no other event is outstanding which constitutes
(or, with the giving of notice, lapse of time,
determination of materiality or the fulfilment
of any other applicable condition, will
constitute) a default under any agreement or
document which is binding on any member of the
Group or any asset of any member of the Group,
which event or default or any action which any
third party is entitled to take following any
such event or default would have a Material
Adverse Effect.
(f) Authorisations: All authorisations required by any
Obligor in connection with the entry into, performance,
validity and enforceability of, and the transactions
contemplated by, the Transaction Documents have been
obtained or effected (as appropriate) and are in full
force and effect, save for any filings, applications and
registrations to the extent that the Company has notified
the Facility Agent in writing prior to the Signing Date
that they can only be obtained after Closing or where the
failure to obtain such authorisation could not reasonably
be expected to have a material impact either on the
business, assets or financial condition of any Obligor or
the Finance Parties or on the validity or enforceability
of the Transaction Documents.
(g) Accounts:
(i) Its Accounts most recently delivered to the
Facility Agent (if audited) present a true and
fair view of or (if unaudited) fairly present
its and (if consolidated) its Subsidiaries
consolidated financial condition as at the date
to which they were drawn up, subject in the
case of quarterly and monthly Accounts to
normal year end adjustments.
(ii) All forecasts and projections delivered to the
Facility Agent pursuant to Clause 21.3 were
arrived at after careful consideration, were
fair and were based on reasonable grounds and
as at the date of such delivery were not to the
Company's knowledge misleading in any material
respect.
(h) Litigation and Labour Disputes: No litigation,
arbitration, administrative or regulatory proceedings are
current or, to its knowledge, pending or threatened,
which are reasonably likely to be adversely determined to
it, and which would, if so determined, have a Material
Adverse Effect. No labour disputes are current or, to its
knowledge, threatened which would have a Material Adverse
Effect.
(i) Tax liabilities: No claims are being or are reasonably
likely to be asserted against any member of the Group
with respect to Taxes which are reasonably likely to be
determined adversely to such member of the Group and
which, if so adversely determined, would have a Material
Adverse Effect. It is not overdue in the filing of any
Tax returns to an extent which would have a Material
Adverse Effect.
(j) Information Package and Reports:
(i) All material factual information contained in
the Information Package was true or, in the
case of information provided by any person
other than the Company or its advisers, was to
its knowledge true in all material respects at
the date (if any) ascribed thereto in the
Information Package or (if none) at the date of
the relevant component of the Information
Package.
(ii) All expressions of opinion or intention and all
forecasts and projections contained in the
Information Package were arrived at after
careful consideration, were fair and were based
on reasonable grounds. The forecasts and
projections contained in the Business Plan are
reasonable and are believed by the Executives
to be attainable.
(iii) The Information Package as of its date (or the
relevant component thereof) was not misleading
in any material respect and did not omit to
disclose any matter failure to disclose which
would result in any information contained in
the Information Package being misleading in any
material respect in the context of this
Agreement.
(iv) To the Company's knowledge as at the Signing
Date :
(A) all material factual information
furnished to each of the firms which
prepared a Report and contained or
referred to therein was true at the
date (if any) ascribed thereto or
(if none) on the date of the
relevant Report;
(B) none of the Reports is misleading;
(C) all expressions of opinion or
intention given by or on behalf of
any member of the Group and all
forecasts and projections furnished
by any member of the Group to each
such firm and contained or referred
to in their respective Reports were
arrived at after careful
consideration, were fair and were
based on reasonable grounds;
(D) such Reports do not omit any
information which would make any
material information, forecasts or
projections in the Reports (or any
of them) misleading;
(E) nothing has occurred or come to
light which renders any of the
material factual information,
expressions of opinion or intention,
projections or conclusions contained
in the Information Package or any of
the Reports, as the case may be,
inaccurate or misleading (or in the
case of expressions of opinion,
conclusions or projections, other
than fair and reasonable),
in each case, in any material respect (or in
the case of (A) or (C) above in all material
respects) in the overall context of the
Acquired Assets, the Group and the transactions
contemplated hereby or which would be
reasonably likely, if disclosed, to adversely
affect the decision of a person (including the
Original Lenders) considering whether to enter
into this Agreement.
(k) Base Financial Statements:
The Base Financial Statements have been prepared in the
manner described in the Accountants Report using
accounting principles and practices described therein
consistently applied and fairly present the aggregated
position of the Target Group as at the date to which the
same were prepared and changes in financial position
during the period for which they were prepared (save to
the extent that, if the Base Financial Statements do not
so fairly present the aggregated position of the Target
Group the manner or extent to which it fails to do so
would not, if disclosed, be reasonably likely adversely
to affect the decision of a person (including the
Original Lenders) considering whether to become a Lender
under this Agreement) and the Base Financial Statements
do not consolidate or include the results of any company,
business or partnership whose business at the Closing
Date is not part of the Acquired Assets.
(l) Documents:
(i) The documents delivered to the Agents (or any
of them) by or on behalf of any Obligor on or
before Closing pursuant to Clause 4.1 and any
other provision of the Finance Documents were
genuine and in the case of copy documents, were
true, complete and accurate copies in all
material respects, of originals which on the
Closing Date had not been amended, varied,
supplemented or superseded in any way which
would be likely materially and adversely to
affect the interests of the Lenders under the
Senior Finance Documents.
(ii) The documents delivered to the Agents (or any
of them) after the Closing Date by or on behalf
of any Obligor pursuant to Clauses 19.1, 19.2,
19.3 and any other provision of the Finance
Documents were when delivered genuine and in
the case of copy documents, were true, complete
and accurate copies in all material respects,
of originals which had not been amended,
varied, supplemented or superseded in any way
which would be likely materially and adversely
to affect the interests of the Lenders under
the Senior Finance Documents.
(iii) The Acquisition Agreements, as furnished to the
Facility Agent pursuant to Clause 4.1, contain
all the material terms of the Acquisition. The
Shareholders Agreement and the articles of the
Company, contain all the material terms of the
agreements and arrangements between the
Investors and the Company (or any other member
of the Group).
(m) Intellectual Property Rights:
(i) It and each of its Subsidiaries owns or has
licensed to it all the Intellectual Property
Rights which are material in the context of the
business of any Material Group Subsidiary and
which are required by such Material Group
Subsidiary in order for it to carry on its
business in all material respects as it is
being conducted and as contemplated in the
Business Plan; and
(ii) it and each of its Subsidiaries has taken all
actions (including payment of fees) required to
maintain in full force and effect any such
registered Intellectual Property Rights
referred to in paragraph (i) above owned by it.
(n) Environmental Matters:
(i) It and its Subsidiaries have obtained all
material Environmental Licences required for
the carrying on of its business as currently
conducted and have at all times complied with
(A) the terms and conditions of such
Environmental Licences and (B) all other
applicable Environmental Laws which, in each
case, if not complied with would have a
Material Adverse Effect or an effect which is,
or is reasonably likely to be, materially
adverse to the business, assets or financial
condition of any Material Group Subsidiary.
There are to its knowledge no circumstances
which may prevent or interfere with such
compliance in the future.
(ii) There is no Environmental Claim current or, to
its knowledge, pending or threatened, and there
are no past or present acts, omissions, events
or circumstances that would be reasonably
likely to form the basis of any Environmental
Claim (including, without limitation, any
arising out of the generation, storage,
transport, disposal or release of any Dangerous
Substance), against any Obligor which if
adversely determined would have a Material
Adverse Effect or an effect which is, or is
reasonably likely to be, materially adverse to
the business, assets or financial condition of
any Material Group Subsidiary.
(o) Representations to the Company: As at the Signing Date
the Company has no reason to believe that any of the
representations and warranties (as qualified by any
related disclosure letter) by the Vendors in the
Acquisition Agreements and/or by the Executives in the
Shareholders Agreement are untrue or inaccurate in any
material respect.
(p) Newcos: Save as arises under the Transaction Documents
and save also for Acquisition Costs, before Closing none
of the Newcos has traded or has any material liabilities
or commitments (actual or contingent, present or future).
(q) Structure Memorandum:
(i) The Structure Memorandum contains descriptions
which in all material respects are true,
complete and correct of the corporate ownership
structure (legal and beneficial) of the Group
(including details of any minority
shareholdings held by any person who is not a
member of the Group and details of all
partnerships in which any member of the Group
has an interest) showing each Subsidiary and
all inter-company loans of more than
(pound)1,000,000 (or its equivalent in other
currencies) as they will be immediately after
Closing.
(ii) There are no re-organisational steps
contemplated at or within 3 months after the
Closing Date (including, without limitation,
significant transfers of business or assets
from one member of the Group to another) nor
any inter-company loans between members of the
Group of more than (pound)1,000,000 (or its
equivalent in other currencies) which are not
described in the Structure Memorandum which
might have a material adverse effect on the
Lenders' interests under the Senior Finance
Documents.
(r) Acquired Assets: Immediately upon Closing each member of
the Group which is contemplated as acquiring shares
pursuant to the Sale and Purchase Agreements will become
the beneficial owner (or owner as the case may be) of
such shares and will be entitled forthwith (subject to
the payment of any necessary stamp or transfer taxes
(which the Company undertakes to pay or procure the
payment of promptly after Closing)) to become the legal
registered owner of such shares free from all
Encumbrances, claims and competing interests whatsoever
save as expressly permitted under the Senior Finance
Documents.
(s) Ownership of assets: Save to the extent disposed of
without breaching the terms of any of the Senior Finance
Documents, with effect from and after Closing, each
Material Group Subsidiary has good and marketable title
(save as disclosed in the Certificates of Title) to or
valid leases or licences of or is otherwise entitled to
use and permit other members of the Group to use all
material assets necessary to conduct the business
conducted by it at Closing and ▇▇▇▇▇ Aviation Limited has
good and marketable title to or valid leases or licences
of or is otherwise entitled to use all material assets
necessary to conduct the ▇▇▇▇▇ Business (as defined in
the UK Sale and Purchase Agreement).
(t) Security Documents:
(i) It is the legal and beneficial owner (or owner,
as the case may be) of the shares of each of
the Material Group Subsidiaries which it
purports to charge pursuant to any of the
Security Documents. The shares charged (or
purported to be charged) by it pursuant to the
Security Documents are all fully paid and
non-assessable, are charged by way of first
ranking charge and are not subject to any
option to purchase or similar rights and,
represent all of the issued share capital of
the relevant company; and
(ii) save as disclosed in the Certificates of Title
it is the legal and beneficial owner of the Key
Properties; and
(iii) it is the legal and beneficial owner (or owner,
as the case may be) of the property (other than
shares) which it charges or purports to charge
pursuant to any of the Security Documents save
to the extent that if it does not so legally
and beneficially own such property it would not
be reasonably likely materially and adversely
to effect the legality, validity or
enforceability (including enforceability
against any third party) of the security taken
as a whole (but excluding share security) given
or purported to be given by members of the
Group forming an Operating Division under the
Security Documents.
(u) ERISA:
(i) No act, omission or transaction has occurred
which will result in the imposition on any U.S.
Obligor or any ERISA Affiliate (whether
directly or indirectly) of:
(1) either a civil penalty assessed
pursuant to section 502(i) of ERISA
or a tax imposed by section 4975 of
the IRC;
(2) breach of fiduciary duty liability
damages,
which would in any such case have a Material
Adverse Effect.
(ii) No Reportable Event has occurred, is planned or
is reasonably expected to occur with respect to
any Pension Plan and no condition or event
currently exists or currently is expected to
occur that could result in any such Reportable
Event. No amendment with respect to which
security is required under Section 401(a)(29)
of the IRC or Section 307 of ERISA has been
made or is reasonably expected to be made to
any Pension Plan. No Pension Plan has incurred
any "accumulated funding deficiency" (within
the meaning of Section 302 of ERISA or Section
412 of the IRC), whether or not waived.
(iii) Payment has been made of all amounts which any
U.S. Obligor or any ERISA Affiliate is required
under the terms of each Plan or applicable law
to have paid as contributions to such Plan
which failure to pay would have a Material
Adverse Effect.
(iv) Each U.S. Obligor and each ERISA Affiliate are
in compliance in all material respects with the
presently applicable provisions of ERISA, the
IRC, its terms, and all other applicable laws,
rules and regulations with respect to each
Plan.
(v) Neither any U.S. Obligor nor any ERISA
Affiliate has at any time maintained,
contributed to or been obliged to contribute to
any Multiemployer Plan or Pension Plan which,
upon the complete or partial withdrawal of the
U.S. Obligor or any ERISA Affiliate from such
Multiemployer Plan or the termination of such
Pension Plan, respectively, individually or in
the aggregate, could result in the imposition
of complete or partial withdrawal liability or
other liability respectively, which would have
a Material Adverse Effect.
(vi) There are no actions, suits or claims pending
(other than routine claims for benefit) against
any Plan or the assets of any such Plan which
could result in a Material Adverse Effect.
(v) Investment Company Status: Each U.S. Obligor is either
(i) not an "investment company" or an "affiliated person"
of, or "promoter" or "principal underwriter" for an
"investment company" in each case within the meaning of
the United States Investment Company Act of 1940, as
amended or (ii) is exempt from all provisions of such
Act, as amended.
(w) Solvency of U.S. Obligors: At the date of this Agreement
or, if later, the date it became an Additional Guarantor,
each U.S. Obligor is, and immediately after consummation
of the transactions contemplated to occur under this
Agreement and the other Transaction Documents and after
giving effect to all obligations incurred and
Encumbrances created by such U.S. Obligor in connection
herewith and therewith will be, Solvent. No Obligor is
entering into this Agreement or any other Transaction
Document or the transactions contemplated hereby with
actual intent to hinder, delay or defraud either present
or future creditors.
As used in this Agreement, "Solvent" means, with respect
to any U.S. Obligor on a particular date, that on such
date (i) the fair value of the assets of such U.S.
Obligor is greater than the total amount of liabilities,
including, without limitation, subordinated and
contingent liabilities, of such U.S. Obligor, (ii) the
amount that will be required to pay the probable
liabilities of such U.S. Obligor on its debts as they
become absolute and matured will not be greater than the
fair saleable value of the property of such U.S. Obligor
at such time, (iii) such U.S. Obligor is able to realise
upon its assets and pay its debts and other liabilities,
contingent obligations and other commitments as they
mature in the normal course of business, (iv) such U.S.
Obligor does not intend to, and does not believe that it
will, incur debts or liabilities beyond such U.S.
Obligor's ability to pay as such debts and liabilities
become absolute and mature, and (v) such U.S. Obligor is
not engaged in a business or a transaction, and is not
about to engage in a business or a transaction, for which
such U.S. Obligor's property would constitute
unreasonably small capital with which to conduct the
businesses in which it is engaged. In computing the
amount of any contingent liability at any time, it is
intended that such liability will be computed at the
amount which, in light of all the facts and circumstances
existing at such time, represents the amount that might
reasonably be expected to become an actual or matured
liability and taking into account the value of rights of
contribution, reimbursement and subrogation which such
U.S. Obligor might reasonably be expected to realise in
respect thereof.
(x) Computer reprogramming and testing:
(a) Any reprogramming required to permit the proper
functioning at all times following 1st January,
2000 of:
(i) the computer systems of each member
of the Group; and
(ii) equipment of each member of the
Group containing embedded microchips
(including systems and equipment
supplied by others or which that
member's systems interface),
and the testing of all such systems and
equipment, as so reprogrammed, will be
completed by 30th June, 1999 except where
failure to do so would not have a Material
Adverse Effect.
(b) The cost to the Group of such reprogramming and
testing and of the reasonably foreseeable
consequences of the advent of the year 2000 to
the Group (including, without limitation,
reprogramming errors and the failure of others'
systems or equipment) will not result in a
Default or a Material Adverse Effect.
20.2 Times for making representations and warranties
The representations and warranties set out in Clause 20.1:
(a) (i) in the case of an Obligor which is a Party on
the Signing Date are made by that Obligor on
the Signing Date, on the date of delivery of
the first Request and on the Closing Date; and
(ii) in the case of an Obligor which becomes a Party
after the Signing Date will be deemed to be
made by that Obligor on the date it executes a
Borrower Accession Agreement or Guarantor
Accession Agreement (with the exception of
Clauses (e)(i), (j), (k), (o), (p), (q) and
(r)); and
(b) (with the exception of Clauses 20.1(a)(ii), (e)(i), (f),
(k), (l)(i), (o), (p), (q), (r) and (s) are in addition
deemed to be repeated after the Closing Date by each
Obligor on the date of each Request, each Utilisation
Date and on each Interest Date with reference to the
facts and circumstances then existing, provided that the
representation and warranty set out in Clause 20.1(j)(i),
(ii) and (iii) shall be repeated only at the request of
the Facility Agent from time to time, provided that the
Facility Agent will notify the Obligors' Agents in
writing at least two weeks before it wishes the
representation to be repeated, the Obligors' Agent may
make further written disclosures in respect of the
repetition of the representation in Clause 20.1(j)(i),
(ii) and (iii) and the representation shall not be
repeated after the end of the period of six months from
the Closing Date.
21. UNDERTAKINGS
21.1 Duration
The undertakings in this Clause 21 remain in force from the date of
this Agreement for so long as any amount is or may be outstanding
under this Agreement or any Commitment is in force.
21.2 Financial Information
The Company shall supply to the Facility Agent in sufficient copies
for each of the Lenders:
(a) as soon as the same are available (and in any event
within 120 days of the end of each of its financial
years):
(i) the audited consolidated accounts of the Group
for that financial year; and
(ii) (if prepared separately) the audited accounts
of each Borrower and (if requested by the
Facility Agent) each other Obligor
(consolidated in the case of an Obligor with
Subsidiaries) for that financial year;
(b) as soon as available (and in any event within 45 days)
after the end of each consecutive three month period
ending on an Accounting Date, the unaudited consolidated
management accounts of (i) the Group and (ii) each
Operating Division, for that three month period in a form
and showing the detailed information provided for in the
Proforma Accounts (including at least a consolidated
profit and loss statement, balance sheet and cash flow
statement), together with a written report of the Chief
Financial Officer explaining any material variances
against the budget for that period;
(c) as soon as available (and in any event within 30 days)
after the end of each calendar month, the unaudited
consolidated management accounts of (i) the Group and
(ii) each Operating Division, for that month in a form
and showing the detailed information provided for in the
Proforma Accounts (including at least a consolidated
profit and loss statement, balance sheet and cash flow
statement), together with a written report of the Chief
Financial Officer explaining any material variances
against the budget for that period;
(d) (i) together with the Accounts specified in
paragraph (a)(i) above:
(A) a certificate signed by the Auditors
(I) setting out in reasonable detail
computations establishing compliance
or otherwise with Clause 22.2, (II)
setting out in reasonable details
computations establishing the
applicable Margin (as contemplated
in Clause 10.4) and the Excess Cash
Capex Amount, and (III) stating that
the Auditors did not in the course
of their audit discover any Event of
Default under Clause 23.1 which they
knew to be an Event of Default under
Clause 23.1 or, if they did,
describing the same;
(B) a certificate signed by two
directors of the Company (one of
whom shall be the Chief Financial
Officer) (I) listing the Material
Group Subsidiaries as at the end of
such annual Accounting Period, (II)
confirming that all premiums
required to be paid to keep the
insurance policies required pursuant
to Clause 21.21 in place for the
next annual Accounting Period have
been paid, (III) detailing the loans
or other investments in Joint
Ventures the proceeds of which are
to be used to fund the working
capital requirements of such Joint
Venture, and (IV) stating that as at
the date of such certificate no
Default has occurred and is then
continuing or providing details of
any such Default and of the remedial
action proposed to be taken; and
(ii) together with the Accounts specified in
paragraph (b) above, a certificate signed by
two directors (one of whom shall be the Chief
Financial Officer) setting out in reasonable
detail computations establishing (I) compliance
with Clause 22.2 as at the date to which those
Accounts were drawn-up, (II) the applicable
Margin (as contemplated in Clause 10.4), (III)
detailing the loans or other investments in
Joint Ventures the proceeds of which are to be
used to fund the working capital requirements
of such Joint Venture, and (IV) stating that as
at the date of the certificate no Default is
outstanding or, if there is an outstanding
Default, providing details of the same and of
any proposed remedial action.
21.3 Projections
(a) The Company shall furnish to the Facility Agent in sufficient
copies for each of the Lenders:
(i) not later than the start of each financial year, a budget
showing a projected consolidated balance sheet as at the
end of each quarterly Accounting Period during such
financial year, profit and loss account, monthly Capital
Expenditure forecast, cash flow statement and rolling
monthly cash forecast of the Group (broken down by
Operating Division) for such financial year and a report
on business strategy together with details of the
principal assumptions underlying such projections
(including assumed disposals or acquisitions) all as
approved by the Company's board of directors; and
(ii) if the budget for the Group for an annual Accounting
Period is revised during such annual Accounting Period,
promptly an updated set of financial projections for the
remainder of such annual Accounting Period,
in each case in a format consistent with the Business Plan and the
Proforma Accounts and prepared in accordance with the Applicable
Accounting Principles.
(b) At least once in every financial year the directors of the Company
will, if requested by the Facility Agent (on the instructions of
the Majority Lenders), give a presentation to the Lenders, at a
time and venue agreed with the Facility Agent (or otherwise as
specified by the Facility Agent by not less than 10 Business Days'
notice and in London), about the ongoing business and financial
performance of the Group and about such other matters relating to
the ongoing business and financial performance of the Group as any
of the Lenders may reasonably request.
21.4 Notifications
The Company shall furnish or procure that there shall be furnished
to the Facility Agent in sufficient copies for each of the Lenders:
(a) promptly, documents required to be despatched by the
Company to its shareholders generally (or any class of
them) in their capacity as such and all documents
relating to the financial obligations of any Obligor
despatched by or on behalf of any Obligor to its
creditors generally (in their capacity as creditors) and
all documents (not being of a purely routine or
administrative nature and to the extent not already
provided to the Facility Agent pursuant to this
Agreement) despatched by or on behalf of any Obligor to
the facility agent under the Subordinated Finance
Documents or to the bond trustee under any bonds or notes
issued by the Subordinated Borrower;
(b) promptly upon being notified of the same, details of all
transfers of more than five per cent. (5%) of any class
of shares in the Company's capital;
(c) on request from the Facility Agent (to be given not more
often than once a year unless an Event of Default under
Clause 23.1 is then outstanding or the Facility Agent has
reasonable grounds for believing that there have been
changes since the furnishing of the last such copy), an
up to date copy of the shareholders register of the
Company;
(d) as soon as the same are instituted or, to its knowledge,
threatened, details of any litigation, arbitration or
administrative proceedings involving any Group member
which, if adversely determined would have a Material
Adverse Effect or which would involve potential or
alleged liability in excess of (pound)5,000,000 (or its
equivalent in other currencies);
(e) as soon as the same are delivered or received (i),
reasonable details of all warranty and indemnity claims,
and of any alleged breach involving liability or
potential liability, in excess of (pound)5,000,000 (or
its equivalent in other currencies) made by or against
any member of the Group pursuant to the Acquisition
Agreements and (ii) details of any post closing
adjustment or other payment required to be made by the
Vendors to the Company (or any of its subsidiaries) or by
the Company (or any of its Subsidiaries) to the Vendors
under the Sale and Purchase Agreements;
(f) promptly, such further information regarding its
financial condition, business and assets and that of the
Group and/or any member thereof (including any requested
amplification or explanation of any item in any Accounts,
forecast, projections or other material provided by any
Obligor hereunder) as the Facility Agent (on behalf of
the Lenders or any of them) may reasonably request from
time to time;
(g) promptly, upon any member of the Group becoming an
Insolvent Group Member, details of the occurrence of any
such event together with a certificate signed by a
director of the Company specifying the gross assets and
latest annual pre-tax profits and turnover of such
Insolvent Group Member;
(h) promptly if requested by the Facility Agent, a copy of
the Service Contracts;
(i) written details of any Default forthwith upon becoming
aware of the same, and of all remedial steps being taken
and proposed to be taken in respect of that Default and,
promptly after being requested by the Facility Agent, a
certificate signed by a director of the Company
confirming that there is no outstanding Default or, if
there is, giving details of the same; and
(j) promptly on receipt, copies of any Group Account Returns
of members of the Target Group received either in the
period before Closing or in the period before the first
monthly consolidated Accounts of the Group are delivered
to the Facility Agent under Clause 21.2(c) after Closing.
21.5 Accounts and Accounting Dates
The Company will ensure that:
(a) each annual Accounting Period and each quarterly
Accounting Period of the Group ends on an Accounting
Date;
(b) each of the annual Accounting Periods (and each financial
year) of it and each Obligor ends on 31st December; and
(c) all Accounts are prepared in accordance with the
Applicable Accounting Principles or where any Accounts
have been prepared in any respect so as to depart
materially from the Applicable Accounting Principles the
Company shall provide to the Facility Agent (in
sufficient copies for each of the Lenders) a written
explanation (and calculations in reasonable detail)
prepared or confirmed by the Auditors of the effect of
such departure on the financial covenants in Clause 22
and the definitions referred to therein. The Facility
Agent (acting on the instructions of the Majority
Lenders) may instruct the Auditors to check, at the cost
of the Company, any such calculations where the Facility
Agent has reasonable grounds for believing that they may
be inaccurate. If the Majority Lenders approve any such
departure it shall become part of the Applicable
Accounting Principles.
21.6 Negative Pledge
No Obligor will, and each Obligor will procure that no member of
the Group will, create or permit to subsist any Encumbrance on the
whole or any part of its respective present or future business,
assets or undertaking except for the following:
(a) Encumbrances constituted or evidenced by the Security
Documents;
(b) Encumbrances expressly permitted in writing by the
Majority Lenders, provided that the principal amount of
the indebtedness secured by such Encumbrances shall not
at any time be increased beyond the amount expressly so
permitted;
(c) Encumbrances arising by operation of law (or by agreement
to the same effect) in the ordinary course of business
and not as a result of any default or omission on the
part of any member of the Group;
(d) Encumbrances over goods and documents of title to goods
arising in the ordinary course of letter of credit
transactions entered into in the ordinary course of
trade;
(e) Encumbrances over credit balances on bank accounts of
members of the Group with Approved Banks together created
in order to facilitate the operation of such bank
accounts and other bank accounts of such members of the
Group with such Approved Banks on a net balance basis
with credit balances and debit balances on the various
accounts being netted off for interest purposes;
(f) Encumbrances over assets acquired after the Closing Date
and existing at the date of their acquisition but not
created in contemplation of their acquisition, provided
that (A) the principal amount secured by any such
Encumbrance shall not be increased beyond the amount
secured thereby at the date of such acquisition and (B)
such Encumbrances are released and discharged within
three months after such acquisition;
(g) Encumbrances arising automatically by operation of law in
favour of any governmental authority in respect of Taxes
or governmental charges in an aggregate amount not
exceeding (pound)1,000,000 (or its equivalent in other
currencies) which are being contested by the relevant
member of the Group in good faith diligently pursued
provided that an appropriate reserve or provision has
been made in the Accounts of the Group;
(h) Encumbrances which may be constituted by retention of
title arrangements entered into (A) in the ordinary
course of trading or (B) with the vendors of stock or raw
materials over stock and/or raw materials purchased in
the ordinary course of trading;
(i) Encumbrances over the asset financed or acquired created
by any finance lease, hire purchase agreements and
conditional sale agreements which are entered into
primarily as a method of raising finance or financing the
acquisition (as the case may be) of any vehicles,
machinery, plant or equipment provided that such finance
lease or agreement is permitted by Clause 21.11; or
(j) Encumbrances (not being over the shares of any member of
the Group) not otherwise permitted pursuant to paragraphs
(a)-(i) (inclusive) above together securing indebtedness
in an aggregate principal amount not exceeding
(pound)7,500,000 (or its equivalent in other currencies),
provided that Encumbrances over the assets of members of
the Group incorporated or established in the United
Kingdom, Canada or the United States of America (or any
part thereof) may not secure indebtedness in an aggregate
principal amount (for all such members of the Group)
exceeding (pound)2,500,000 (or its equivalent in other
currencies).
21.7 Transactions similar to security
No Obligor will, and each Obligor will procure that no member of
the Group will:
(a) sell, transfer or otherwise dispose of:
(i) any of its assets on terms whereby such asset
is or it is contemplated may be leased to or
re-acquired or acquired by any member of the
Group other than where the asset to be sold,
transferred or disposed of is not subject to
any fixed or similar security pursuant to the
Security Documents or for the sale and
leaseback of aircraft engines by members of the
Group and where in any such case the lease is
permitted under Clause 21.11; or
(ii) any of its receivables on recourse terms except
for the discounting of bills and notes in the
ordinary course of business where the resulting
Borrowing is permitted by Clause 21.10; or
(b) except for assets acquired in the normal course of
trading purchase any asset on terms providing for a
retention of title by the vendor or on conditional sale
terms or on terms having a like substantive effect to any
of the foregoing.
21.8 Disposals
No Obligor will, and each Obligor will procure that no member of
the Group will, (save as expressly provided for in the Structure
Memorandum) either in a single transaction or in a series of
transactions, sell, transfer, lease, licence or otherwise dispose
of:
(a) any shares in any member of the Group save where such
disposal has been approved by the Majority Lenders and
the Net Proceeds are applied in accordance with Clause
9.5; or
(b) all or any part of its respective assets or undertaking
(not being shares in a member of the Group), other than:
(i) (A) disposals of trading assets or (B) the
expenditure of cash or (C) the sale or
discounting of receivables on a non-recourse
basis, in each case in the ordinary course of
trading on arm's length terms;
(ii) disposals of obsolete or redundant plant and
equipment, or of real property (not being any
of the Key Properties or the real properties
owned by members of the Group at Winnipeg in
Canada and Tennessee in the United States of
America) not required for the efficient
operation of its business, on arm's length
terms;
(iii) the lending of cash and the repayment of cash
lent in compliance with the terms of the
Finance Documents;
(iv) the payment of fees and interest on the amounts
outstanding under the Finance Documents in
compliance with the Priority Agreement;
(v) disposals of Cash Equivalent Investments on
arm's length terms;
(vi) the sale and leaseback of engines by members of
the Group;
(vii) subject to compliance with Clause 9.5,
disposals of assets (not being any of the Key
Properties or the real properties owned by
members of the Group at Winnipeg in Canada and
Tennessee in the United States of America)
where all or part of the sale price is to be
applied by the Obligor in the purchase of
replacement assets which are comparable or
superior as to type, value and quantity and
such replacement assets are purchased within
twelve months of such disposal provided that
where part only of such proceeds are so
utilised, that part is sufficient to satisfy
the entire amount of such purchase price;
(viii) disposals which have the prior written consent
of the Facility Agent (acting on the
instructions of the Majority Lenders);
(ix) disposals of assets on arm's length terms not
otherwise permitted under this Clause 21.8
provided that the aggregate fair market value
of the assets disposed of does not exceed
(pound)2,500,000 (or its equivalent in other
currencies) during any annual Accounting Period
or (pound)20,000,000 (or its equivalent in
other currencies) in aggregate until the
Facilities have been repaid in full;
(x) the disposal of the shares of Wheels India
Limited as provided for in the UK Sale and
Purchase Agreement where the Net Proceeds are
paid to the Vendors.
All such sales, transfers, leases or other disposals
(other than under paragraph (b)(i)(B), (iii) and (iv))
shall be made only for a cash consideration payable in
full at the time of disposal,
Provided that no Obligor incorporated or resident in
Canada may make a disposal of a type not described in
Clause 9.5(i) to (v) (inclusive) but otherwise permitted
by 21.8(b)(ii), (vii) or (ix), save that such Obligor may
be released from the restriction set out in this proviso
if it prepays an amount of the Utilisations equal to the
Net Proceeds arising from any such disposal.
21.9 Pari passu ranking
Each Obligor undertakes that its obligations under this Agreement
rank and will at all times rank at least pari passu in right and
priority of payment with all its other present and future unsecured
and unsubordinated obligations, other than obligations applicable
generally to companies which have priority by operation of law.
21.10 Borrowing
No Obligor will, and each Obligor will procure that no other member
of the Group will, incur or permit to remain outstanding any
Borrowings falling within paragraphs (a), (b), (c), (d) or (h) of
the definition of Borrowings in Clause 1.1 other than:
(a) under the Subordinated Finance Documents (in an aggregate
principal amount not exceeding(pound)125,000,000 (or its
equivalent in other currencies)); or
(b) under the Senior Finance Documents; or
(c) any such Borrowings as are permitted by Clause 21.16(b);
or
(d) Borrowings to the extent covered by a Documentary Credit
made available under this Agreement; or
(e) any other Borrowings to the extent approved in writing by
the Facility Agent on behalf of the Majority Lenders; or
(f) any other Borrowings in an aggregate principal amount at
any time outstanding for members of the Group as a whole
not exceeding (pound)15,000,000 (or its equivalent in
other currencies) for the first six months after the
Closing Date and thereafter (pound)10,000,000 (or its
equivalent in other currencies) and which in any such
case when aggregated with the Original Sterling Amount of
the then outstanding Tranche D Utilisations will not
exceed the amount of the then Tranche D Commitments; or
(g) any other Borrowings in an aggregate principal amount at
any time outstanding for members of the Group as a whole
not exceeding (pound)10,000,000 (or its equivalent in
other currencies) PROVIDED THAT the aggregate principal
amount of such Borrowings incurred or owed by the
Obligors (taken as a whole) at any time may not exceed
(pound)5,000,000 (or its equivalent in other currencies).
21.11 Leases
(a) No Obligor will, and each Obligor will procure that no member of
the Group will enter into any operating leases, finance leases or
conditional sale agreement of or in respect of vehicles, machinery,
plant or equipment (the "Equipment") if the amount payable
(excluding any interest element) under such operating leases,
finance lease or conditional sale agreement when taken together
with the amounts payable (excluding any interest element) under all
other operating leases, finance leases or conditional sale
agreements of members of the Group would exceed (pound)45,000,000
(or its equivalent in other currencies) at any time.
(b) The Company will, if requested by the Facility Agent, provide
reasonable details of the Equipment subject to any such operating
leases, finance leases or conditional sale agreements and the
amounts payable thereunder.
21.12 Third party guarantees
No Obligor will, and each Obligor will procure that no member of
the Group will, incur or permit to be outstanding any guarantee,
indemnity or other assurance against loss of a type referred to in
paragraph (i) of the definition of Borrowing in Clause 1.1 other
than (a) under the Finance Documents, or (b) the endorsement of
negotiable instruments for the purpose and in the ordinary course
of carrying on the relevant entity's trade, or (c) guarantees in
favour of an Approved Bank to facilitate the operation of bank
accounts of Obligors maintained with such Approved Bank on a net
balance basis, or (d) guarantees of members of the Group which are
not Obligors in favour of an Approved Bank to facilitate the
operation of bank accounts of members of the Group which are not
Obligors maintained with such Approved Bank on a net balance basis,
or (e) in respect of the Borrowings of any other Obligor which are
permitted under Clause 21.10 or only in the case of members of the
Group who are not Obligors in respect of the Borrowings of any
other member of the Group which are permitted under Clause 21.10,
or (f) under the letter executed by Dunlop Standard Aerospace
Overseas Limited addressed to Mr ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ of ▇▇▇▇▇, ▇▇▇▇▇ &
Helmsley solicitors, Sydney as in force on the date of this
Agreement.
21.13 Options
No Obligor will, and each Obligor will procure that no member of
the Group will, enter into or permit to subsist any option or other
arrangement whereby any person has the right (whether or not
exercisable only on a contingency) to require any member of the
Group to purchase or otherwise acquire or sell or otherwise dispose
of any property or any interest in any property otherwise than
where (I) any such arrangement is in respect of trading assets and
is entered into in the ordinary course of trade of the member of
the Group concerned, or (II) any such arrangement is in respect of
assets having a market value in an aggregate amount (for all such
arrangements of members of the Group) which if it were exercised
would, at the date of such exercise, be a disposal permitted under
Clause 21.8 or an investment permitted under Clause 21.15 and is
entered into on arm's length terms, or (III) any such arrangement
is permitted by Clause 21.14.
21.14 Treasury Transactions
Save for those transactions specified in the list of outstanding
treasury transactions provided to the Facility Agent by the Company
prior to the Signing Date (if any), no Obligor will, and each
Obligor will procure that no member of the Group will, enter into
or permit to subsist any interest rate or currency swap, cap,
ceiling, collar, floor or financial futures or commodity contract
or option or any similar treasury or hedging transaction, other
than (a) the Hedging Documents, (b) spot foreign exchange contracts
entered into in the ordinary course of business and (c)
transactions entered into for the hedging of actual or projected
exposures arising in the ordinary course of ordinary trading
activities of members of the Group carried on in compliance with
the terms of the Finance Documents for periods of not more than 36
months.
21.15 Investments
No Obligor will, and each Obligor will procure that no member of
the Group will incorporate any company or enter into any merger or
consolidation with any business or person or acquire (by
subscription or otherwise) or invest in any business or company or
any shares or other securities (or any interest therein) other
than:
(a) Cash Equivalent Investments; or
(b) pursuant to the Re-organisation (or as expressly provided
for in the Structure Memorandum); or
(c) for the acquisition of shares in members of the Target
Group acquired at Closing; or
(d) for the acquisition of all of the shares of limited
liability companies or for the acquisition of businesses
(provided that if any liabilities (actual or contingent,
present or future) are being acquired such acquisition
must be made by forming a limited liability company whose
sole purpose is to make the acquisition, and which
acquires such business) which (I) carry on a similar
business or which business is similar to those currently
undertaken by a Target and its Subsidiaries, and (II)
which have an aggregate purchase price (including the
amount of any Borrowings of the acquired company or
business repaid or prepaid at the time of acquisition or
which remain outstanding) for all such acquisitions not
exceeding(pound)20,000,000 (or its equivalent in other
currencies) in any annual Accounting Period
or(pound)90,000,000 (or its equivalent in other
currencies) from the period from the Closing Date until
the Final Maturity Date, PROVIDED THAT:
(i) the aggregate purchase price (the "Total
Purchase Price") for all such acquisitions
(including associated costs and expenses
together with the aggregate amount of
outstanding Borrowings or other liabilities of
all such companies or businesses so acquired at
the time of their acquisition) does not exceed
the aggregate amount of:
(A) an amount equal to the aggregate
amount of the Net Proceeds received
by members of the Group which,
pursuant to Clause 9.5(v), has not
been required to be applied in
prepayment of the Utilisations (but
excluding any amount of Net Proceeds
retained by members of the Group
pursuant to Clauses 9.5(i)-(iv)
(inclusive)); plus
(B) the amount of the proceeds of any
subscription in cash for shares in
the Company (other than any such
subscription (I) made on or prior to
the Closing Date pursuant to the
Shareholders Agreement, or (II)
which constitutes an Investors Capex
Contribution Amount or (III) to the
extent such proceeds have been used
to make Joint Venture Investments
pursuant to Clause 21.34 or used to
redeem share capital pursuant to
Clause 21.18) or the proceeds of any
subordinated loan made to the
Company which in either case is not
redeemable or repayable until one
year after the Subordinated
Discharge Date (as defined in the
Priority Agreement) and which is
otherwise on terms approved by the
Majority Lenders; plus
(C) an amount not exceeding
(pound)5,000,000 (or its equivalent
in other currencies) per annum;
(ii) no Default has occurred and is continuing at
the time of acquisition and the purchase price
for such acquisition is paid in full in cash on
the date of acquisition;
(iii) investments in or acquisition of any company or
business which (A) has made an operating loss
of greater than(pound)500,000 (or its
equivalent in other currencies) in any of the
previous 3 financial years as evidenced in the
audited (or if unaudited, management) financial
statements of such company or business and/or
(B) is located outside the European Union or
the United States of America or Canada or the
country of incorporation of any Obligor, may
only be made (I) if in the case of a company or
business located in the European Union, the
United States of America or Canada the
operating loss in any of the previous financial
years exceeds(pound)500,000 but does not
exceed(pound)5,000,000 (or its equivalent in
other currencies) if the Company has delivered
to the Facility Agent prior to the making of
any such disposal a business plan approved by
the Chief Financial Officer relating to such
company or business projecting that such
company or business makes an operating profit
in the annual Accounting Period following its
acquisition together with an independent
accountants report on such company or business,
or (II) with the prior written consent of the
Majority Lenders; and
(iv) to the extent lawful, security is given over
such shares or assets (subject to the Agreed
Security Principles) upon or immediately
following their acquisition in favour of (and
in form and substance satisfactory to) the
Security Agent (or as otherwise provided in
this Agreement) for the Lenders by the relevant
member of the Group; or
(e) the acquisition of shares in Joint Ventures to the extent
permitted by Clause 21.34.
21.16 Loans out
No Obligor will, and each Obligor will procure that no member of
the Group will, be the creditor in respect of any Borrowings, save
for:
(a) any Borrowings under paragraph (e) of the definition of
"Borrowings" in Clause 1.1 where trade credit is extended
by any member of the Group on normal commercial terms and
in the ordinary course of its business; or
(b) loans made by one member of the Group to another member
of the Group where:
(i) the loan is specified in the Structure
Memorandum; or
(ii) the recipient of the loan is an Obligor and
requires the funds to meet its normal working
capital requirements or to meet its obligations
under the Finance Documents; or
(iii) loans by a member of the Group which is not an
Obligor to another member of the Group which is
not an Obligor and which is its Holding Company
or a Subsidiary of it; or
(c) loans made by any member of the Group to the employees of
the Group in an aggregate amount for the Group as a whole
at any time outstanding not exceeding (pound)500,000 (or
its equivalent in other currencies); or
(d) Borrowings not otherwise permitted pursuant to paragraphs
(a), (b) or (c) in an aggregate amount for the Group as a
whole at any time outstanding not exceeding
(pound)5,000,000 (or its equivalent in other currencies),
PROVIDED THAT the aggregate amount of such Borrowings
plus the aggregate amount of the Borrowings permitted
under Clause 21.10(g) outstanding at any time may not
exceed (pound)10,000,000 (or its equivalent in other
currencies); or
(e) loans or Borrowings made with the prior written consent
of the Majority Lenders; or
(f) loans made by a member of the Group to the ▇▇▇▇▇ Air
Force Base Joint Venture or other Joint Ventures provided
that the aggregate principal amount (taken together with
any investment in Joint Ventures permitted under Clause
21.34(a)(iii)) of any such loans (excluding the amount
used to fund the working capital of such Joint Venture)
does not exceed one hundred and fifteen per cent. (115%)
of the amounts specified in Clause 22.3(b).
21.17 Dividends and fees
The Company will not:
(a) declare, make or pay any dividend (or interest on any
unpaid dividend), charge, fee or other distribution
(whether in cash or in kind) on or in respect of its
Shares (or any class of its Shares) or distribute any
dividend or share premium reserve account or pay any
amount of interest on or other amount relating to any
loan stock; and
(b) (and will procure that no other member of the Group will)
pay any management, advisory or other fee to or to the
order of the Investors or any of them or pay any
directors' fee other than any such fees (and in such
amounts as have been notified to the Facility Agent prior
to the Signing Date) as are payable under or referred to
in the Shareholders Agreement as in force on the Signing
Date.
21.18 Share Capital and Loan Stock
No Obligor will, and each Obligor will procure that no member of
the Group will:
(a) redeem, repurchase, defease, retire or repay any of its
share capital or any loan stock, or resolve to do so,
unless, in the case of the Company only, such redemption,
repurchase, retirement or repayment is financed out of
the proceeds received in cash of an issue of shares by
the Company (not being any proceeds, which constitute an
Investors Capex Contribution Amount or to the extent the
proceeds are used to fund any acquisition under Clause
21.15 or any Joint Venture Investment under Clause 21.34)
or subordinated shareholder loans made to the Company (to
the extent the proceeds are not used to fund any
acquisition under Clause 21.15 or Joint Venture
Investment under Clause 21.34), which are not redeemable
or repayable prior to the date one year after the
Subordinated Discharge Date (as defined in the Priority
Agreement) and the other terms of which are satisfactory
to the Majority Lenders; or
(b) issue any shares which by their terms are redeemable or
any loan stock which by its terms is repayable prior to
the date falling one year after the Subordinated
Discharge Date (as defined in the Priority Agreement); or
(c) issue any share capital to any person other than to
another member of the Group, save that the Company may
issue share capital as contemplated by the Shareholders
Agreement (as in force on the Signing Date hereof ) or
the Warrant Instrument (as defined in the Bridge Facility
Agreement and as in force on the Closing Date) and other
share capital of a type substantially similar to any
class of its shares in issue at Closing which in each
case is subscribed for in full in cash and in respect of
which no dividend or distribution is payable while any
amount is outstanding under the Senior Finance Documents.
21.19 Intellectual Property Rights
Each Obligor will, and will procure that each member of the Group
will, except to the extent the Facility Agent (on the instructions
of the Majority Lenders) otherwise consents in writing (such
consent not to be unreasonably withheld):
(a) make such registrations and pay such fees and other
amounts as are necessary to keep those registered
Intellectual Property Rights which are material to the
business of an Obligor or a Material Group Subsidiary in
force and to record its interest in those Intellectual
Property Rights;
(b) take such steps as are necessary and commercially
reasonable (including, without limitation, the
institution of legal proceedings) to prevent third
parties infringing those Intellectual Property Rights
referred to in paragraph (a) above; and
(c) not, without the prior written consent of the Majority
Lenders sell, assign, transfer, charge, terminate or
enter into any material contract or licence arrangement
in respect of those rights save for (i) licence
arrangements entered into with members of the Group for
so long as they remain members of the Group, (ii)
non-exclusive licence arrangements entered into on normal
commercial terms and in the ordinary course of its trade
and which do not in either case affect any Encumbrance
arising under any of the Security Documents or the value
of any assets secured by such Encumbrances.
21.20 Environmental matters
Each Obligor will and will procure that each other member of the
Group will:
(a) obtain all requisite Environmental Licences and comply
with (i) the terms and conditions of all such
Environmental Licences applicable to it, and (ii) all
other applicable Environmental Law, where in each such
case failure to do so would have a Material Adverse
Effect or would have, or would be reasonably likely to
have, a material adverse effect on the business, assets
or financial condition of any Material Group Subsidiary;
(b) implement in all material respects the requirements
specified in the environmental report referred to at
paragraph (d) of the definition of Reports in Clause 1.1
within the time-period referred to in such report;
(c) promptly upon receipt of the same, notify the Facility
Agent of any claim, notice or other communication served
on it in respect of any alleged breach of or corrective
or remedial obligation or liability under any
Environmental Law which would, if substantiated, have a
Material Adverse Effect or would have, or would be
reasonably likely to have, a material adverse effect on
the business, assets or financial condition of any
Material Group Subsidiary; and
(d) indemnify each Finance Party, each receiver appointed
under any Security Document and their respective
officers, employees, agents and delegates (together the
"Indemnified Parties") against any cost or expense
suffered or incurred by them (except if caused by their
own negligence) which:
(i) arises by virtue of any actual or alleged
breach of any Environmental Law (whether by any
Obligor, an Indemnified Party or any other
person); or
(ii) arises by virtue of the release or threatened
release of, or exposure to, any Dangerous
Substance stored or handled upon, transported
from, or otherwise associated with, the past or
present facilities or operations of any Obligor
or Group member,
and which would not have arisen if the Finance Documents
or any of them had not been executed.
21.21 Insurance
(a) Each Obligor will, and will procure that each member of the Group
will, insure and keep insured all its property and assets of an
insurable nature and which are customarily insured (either
generally or by companies carrying on a similar business) against
loss or damage by fire and other risks normally insured against by
persons carrying on the same class of business as that carried on
by it at levels no lower than (and covering at least the same risks
as) those recommended in the Insurance Report with reputable
independent insurance companies or underwriters.
(b) Without prejudice to paragraph (a) above, each Obligor will, and
will procure that each member of the Group will, effect and
maintain insurance against business interruption, loss of profits,
product liability, professional indemnity, pollution and public
liability and those other risks or liabilities recommended in the
Insurance Report at levels no lower than (and on substantially the
same terms as) those recommended in the Insurance Report or as
otherwise agreed by the Facility Agent acting reasonably with
reputable independent insurance companies or underwriters.
(c) Each Obligor will, and will procure that each member of the Group
will, promptly pay all premiums and do all other things necessary
to ensure that the insurances required to be taken out and
maintained by it pursuant to paragraphs (a) and (b) above remain in
force and will use all reasonable endeavours to procure that
(except for public liability, employers liability and professional
indemnity insurances) all of the insurance policies required to be
taken out and maintained by it pursuant to paragraphs (a) and (b)
above shall contain loss payee provisions acceptable to the
Security Agent noting the Security Agent's interest thereon and
naming the Security Agent as the payee.
(d) The Company will promptly supply to the Facility Agent on request
copies of each insurance policy (or if not then available the
relevant brokers summary of cover relating to such insurance
policy) required to be taken out and maintained by any member of
the Group pursuant to this Clause 21.21 and will procure that the
insurer in the case of each such policy undertakes to the Facility
Agent to notify the Facility Agent should any renewal fee or other
sum payable by any member of the Group not be paid when due.
21.22 Change of business
No Obligor will, and each Obligor will procure that no member of
the Group will, make any material change in the nature of its
respective business as conducted at the Closing Date which would
result in a material change to the nature of the business carried
on by the Group as a whole.
21.23 Inter-Company Debt
(a) Each Obligor will procure that unless the borrower in respect of
such Borrowings has sufficient readily available cash or credit
lines with available headroom (and not being subject to conditions
precedent other than the mere request for the funds) to pay the sum
due or demanded or save as provided for in the Priority Agreement,
any member of the Group which is the creditor in respect of any
Borrowings by any other member of the Group shall take no action to
cause such Borrowings to become due or to be paid.
(b) Each Obligor will promptly notify the Facility Agent if it (or any
of its Subsidiaries) makes a loan (or series of loans to the same
person) to any other member of the Group which is either (A) a loan
from Dunlop Standard Aerospace Group Limited or Dunlop Standard
Aerospace Holdings Limited to Holdco or any Subsidiary of Holdco
and whether or not from out of the proceeds of an Investors Capex
Contribution Amount or (B) is for an amount of (pound)5,000,000 (or
its equivalent in other currencies) or more and is expected to
remain (or has remained) outstanding for six months or more, and if
required by the Facility Agent shall procure that (i) the borrower
and lender of such loan become party to the Priority Agreement as
an Intercompany Debtor and Intercompany Creditor respectively, and
(ii) security (in a form satisfactory to the Security Agent acting
reasonably and in accordance with the Agreed Security Principles)
in favour of the Lenders is granted over any such loan (or series
of loans).
21.24 Arm's length terms
No Obligor will, and each Obligor will procure that no member of
the Group will, enter into any material transaction with any person
otherwise than on arm's length terms, save for intercompany loans
permitted pursuant to Clause 21.16(b).
21.25 Surplus Cash
(a) The Company will procure that each member of the Group shall,
subject to retaining sufficient cash for the forecast cashflow
requirements of such member of the Group (which shall be determined
by the board of directors of such member of the Group, acting
reasonably, having regard to their responsibilities under
applicable law), utilise their cash balances so as to reduce or
minimise working capital borrowings (including any under the
Tranche D Facility) and (to the extent that to do so would not be
likely to cause a breach of law or regulation on the part of the
relevant company or its directors) to service the required interest
and scheduled principal payable on the Facilities and, to the
extent that the directors of any member of the Group consider that
such member of the Group would otherwise accumulate material cash
balances in excess of the amounts otherwise required by it, shall
(to the extent not in breach of applicable law) if the company
concerned is incorporated in a jurisdiction where security over
cash has not been created in favour of the Lenders lend such
surplus cash to another member of the Group in a jurisdiction in
which the Lenders have the benefit of security over cash pursuant
to the Security Documents.
(b) Each Obligor will, and each Obligor will procure that each of its
Subsidiaries will, if incorporated in a jurisdiction where an
Encumbrance over cash is being given pursuant to any of the
Security Documents ensure that, save as otherwise permitted by this
Agreement (or prohibited by applicable law) all of its cash and the
cash of its Subsidiaries is kept in any account which is subject to
security in favour of the Security Agent (or as otherwise provided
in this Agreement) pursuant to the Security Documents.
21.26 Amendments to documents
(a) No Obligor will, and each Obligor will procure that no member of
the Group will, without the prior written consent of the Facility
Agent (on the instructions of the Majority Lenders), amend,
supplement, supersede or waive (i) any material term of the
Transaction Documents or (ii) its memorandum or articles of
association or other constitutional document in any material
respect which might adversely affect the interests of the Lenders
under Senior Finance Documents or (iii) any other document
delivered to the Agents (or any of them) pursuant to Clauses 4.1,
19.1, 19.2, 19.3 or any other provision of this Agreement in any
material respect which might adversely affect the interests of the
Lenders under the Senior Finance Documents or (iv) enter into any
agreements or arrangements (other than on arm's length terms) with
the Investors in their capacity as such other than the Shareholders
Agreement and Articles of the Company (provided that if any such
undertaking would not be enforceable against any Obligor it shall
not be given by that Obligor).
(b) The consent of the Lenders shall not be unreasonably withheld where
such amendments are required to comply with the terms of the Senior
Finance Documents.
(c) This Clause 21.26 shall not prevent the Company from agreeing to
renew any Service Contracts on substantially the same terms.
21.27 Bank Accounts
No Obligor incorporated in England and Wales, the United States of
America or Canada will open or maintain any account with any branch
of any bank or other financial institution providing like services
(other than an account maintained with a Finance Party pursuant to
the requirements of the Senior Finance Documents) unless such
branch and bank or financial institutions are Approved Banks.
21.28 Compliance with laws
Each Obligor will, and will procure that each member of the Group
will, comply in all material respects with all applicable laws and
regulations of any governmental authority, whether domestic or
foreign having jurisdiction over it or any of its assets, where
failure to comply with any such laws or regulations would have a
Material Adverse Effect or would have, or would be reasonably
likely to have, a material adverse effect on the business, assets
or financial condition of any Material Group Subsidiary or which
are required to enable it lawfully to enter into the Senior Finance
Documents and will obtain and promptly renew from time to time, and
if so requested promptly furnish certified copies to the Facility
Agent of all material authorisations which may be required under
any applicable law or regulation to enable each Obligor to perform
its respective obligations under the Senior Finance Documents or
required for the validity or enforceability of such Senior Finance
Documents or of any security provided for thereby.
21.29 Auditors
(a) Each Obligor will, and will procure that each other member of the
Group will, instruct its auditors (at the cost of such Group
member) to provide to the Facility Agent such information on or
about the Group's and/or such other Group member's financial
position or to explain to the Facility Agent any such information
provided to the Facility Agent under this Agreement or to verify
any of the calculations delivered pursuant to Clause 21.2(d) on
request from the Facility Agent (not to be made more than once in
any annual Accounting Period unless the Facility Agent has
reasonable grounds for believing that there is a breach of Clause
22 or that any of the calculations delivered pursuant to Clause
21.2(d) may be incorrect or that any of the Accounts delivered
pursuant to Clause 21.2 have not been prepared in accordance with
the Applicable Accounting Principles) and to disclose to the
Facility Agent for itself and the Lenders (and provide them with
copies of) such information as the Facility Agent and the Lenders
have requested from the Company pursuant to this Agreement
regarding the financial condition and operations of the Group and
any member of the Group (if, when requested, the Company has failed
to provide or procure the provision of the same to the reasonable
satisfaction of the Lenders).
(b) The Company will appoint one of the firms specified in the
definition of "Auditors" in Clause 1.1 to be its auditors and to
audit its consolidated annual accounts.
(c) The Company will, if it changes its Auditors, instruct both the
outgoing and incoming Auditors to discuss the Group's financial
condition with the Facility Agent (if so requested by the Facility
Agent).
21.30 Access
Upon reasonable notice being given by the Facility Agent, each
Obligor will procure that any one or more representatives of the
Facility Agent and/or accountants or other professional advisers
appointed by the Facility Agent be allowed (at the Facility Agent's
risk and expense or if after the occurrence of an Event of Default
at the Company's expense) to have access during normal business
hours to the assets, books and records of each member of the Group
and to inspect the same.
21.31 Pension Schemes and Tax Allowances
(a) The Obligors will if requested by the Facility Agent deliver to the
Facility Agent at intervals of no more than three calendar years,
and in any event at such time as those reports are prepared in
order to comply with then current statutory or auditing
requirements, actuarial reports in relation to the pension schemes
for the time being operated by members of the Group and will ensure
that the pension schemes (and any other scheme required by law to
be fully funded) are fully funded as required by law and based on
reasonable actuarial assumptions.
(b) Each Obligor shall and shall procure that each of its Subsidiaries
shall use all reasonable endeavours to retain and/or utilise the
benefit of any carried forward tax allowances or losses available
to it either for its own account or for the account of another
member of the Group.
21.32 Syndication
The Company shall provide reasonable assistance to the Syndication
Agent in the preparation of the information memorandum for
syndication of the Facilities and will comply with all reasonable
requests for access (including site visits to those sites agreed
with the Arranger) and information from potential syndicate
members. The Company shall procure that the Executives shall, if
requested by the Facility Agent, give a presentation in London to
potential syndicate members. The Company shall in good faith agree
the Information Package with the Syndication Agent.
21.33 Executives
(a) The Company will procure that each of the Executives will perform
the functions for which he or she has been employed and undertakes
that if he or she ceases (whether by reason of death, retirement at
normal retiring age or through ill health or otherwise) to perform
such duties it will promptly notify the Facility Agent and will
find a replacement for him or her reasonably acceptable to the
Majority Lenders and effectively appoint the same (such appointment
deemed to be effective on its acceptance by the replacement) within
180 days of such Executive ceasing to perform such duties provided
that if the Majority Lenders reject the first replacement tendered
by the Company, the Company shall have three months from the date
on which the Majority Lenders notified it that the tendered
replacement was unacceptable to find and appoint a replacement.
(b) The Company will procure that at least one of the Executives or the
Operating Division Heads is at all times on the board of directors
(or equivalent management body) of each of the Obligors.
21.34 Joint Ventures
(a) No Obligor will, and each Obligor will procure that none of its
Subsidiaries will, enter into or acquire or subscribe for any
shares, stock, securities or other interest in or transfer any
assets to or lend to or guarantee the obligations of any Joint
Venture (each a "Joint Venture Investment"), PROVIDED THAT members
of the Group can make Joint Venture Investments (i) where the
aggregate amount applied in making any such acquisitions, together
with the aggregate book value (at the time of transfer) of all such
assets transferred and the aggregate principal amount of all such
loans and maximum contingent liability under all such guarantees
from time to time outstanding does not exceed(pound)7,500,000 (or
its equivalent in other currencies) and the making of any such
Joint Venture Investment is permitted by Clause 22.3 or (ii) to the
extent that such Joint Venture Investment is financed from out of
the proceeds of any subscription for shares in the Company (which
are not redeemable prior to the Senior Discharge Date (as defined
in the Priority Agreement) and on which no dividends are payable
until after such date) or subordinated loans made to the Company
(subordinated on terms agreed in writing by the Majority Lenders)
received in cash by the Company after the Closing Date (not
constituting an Investors Capex Contribution Amount) or (iii) such
Joint Venture Investment is in the ▇▇▇▇▇ Air Force Base Joint
Venture and the aggregate amount of such Joint Venture Investments
does not exceed 115% of the amount specified in Clause 22.3(b) as
being invested in the ▇▇▇▇▇ Air Force Base Joint Venture AND
PROVIDED FURTHER THAT loans to or the acquisition of shares or
stock or securities or other investment in any Joint Venture to the
extent that such loans acquisitions or investments are made to fund
the working capital of such Joint Venture will not constitute a
Joint Venture Investment.
(b) Each Obligor will, and each Obligor will procure that each of its
Subsidiaries will, only enter into or become party to any Joint
Venture which carries on a business substantially the same as a
business carried on by another member of the Group.
(c) No Obligor will, and each Obligor will procure that none of its
Subsidiaries will, commit to any third party or enter into any
Joint Venture or become party to any joint venture agreement or
arrangement where it has any obligation (whether to such Joint
Venture or to any other person and whether actual or contingent) to
lend to or guarantee or transfer assets to or otherwise fund or
incur any liability in respect of such Joint Venture or any other
person or to acquire any shares or interest in or assets of such
Joint Venture in each case (i) where any such obligation or
liability is not subject to an express maximum limit, (ii) where if
such maximum level of obligations or liabilities was incurred it
would cause any breach of this Clause 21.34 and (iii) where any
such obligation or liability would, if exercised, cause any breach
of any other provision of this Agreement.
(d) No Obligor will, and each Obligor will procure that none of its
Subsidiaries (ignoring for these purposes the special purpose
company referred to below) will, enter into, become a member of or
acquire any interest in any Joint Venture other than by the
acquisition of shares in a Joint Venture which is itself a limited
liability entity or by means of the ownership by such member of the
Group of a special purpose limited liability company which is
itself a party to any such Joint Venture.
21.35 Holding Company
(a) The Company shall not hold or acquire any shares other than shares
in Dunlop Standard Aerospace Holdings Limited or the Subordinated
Borrower (if different) or carry on any business (other than the
provision of administrative services to other members of the
Group). The Company shall lend the proceeds of any Investors Capex
Contribution Amount to Holdco.
(b) Dunlop Standard Aerospace Holdings Limited and the Subordinated
Borrower (if different) shall not carry on any business or acquire
any assets (other than in the case of Dunlop Standard Aerospace
Holdings Limited the holding of shares in Holdco) other than Cash,
Cash Equivalent Investments and the benefit of the intercompany
loan between Dunlop Standard Aerospace Holdings Limited and Holdco
set up at Closing, without the prior written consent of the
Majority Lenders.
21.36 Subordinated Debt
(a) The Company will not repay, prepay, redeem or repurchase any
principal amount outstanding under the Subordinated Finance
Documents until all amounts outstanding under the Senior Finance
Documents have been repaid in full and the Commitments of the
Lenders cancelled, save that the Company may prepay or procure the
prepayment of all (but not some only) of the amounts outstanding
under the Bridge Facility Agreement either from out of the net
proceeds borrowed under the Subordinated Facility Agreement or from
out of the net proceeds received in cash by the Subordinated
Borrower from the issue of any high yield bonds or notes (the
"Bonds").
(b) Neither the Company nor any other member of the Group may enter
into the Subordinated Facility Agreement or issue the Bonds unless:
(i) the principal amount of the Subordinated Facility
Agreement or the net proceeds of the Bond is not less
than (pound)125,000,000 (or its equivalent in other
currencies) and sufficient to prepay amounts outstanding
under the Bridge Facility Agreement in full;
(ii) the maturity date of the Subordinated Facility Agreement
or the Bonds is not less than 10 years from the Closing
Date; and
(iii) the other terms of the Subordinated Facility Agreement or
the Bonds (and any related documentation) have been
approved in writing by the Facility Agent (on behalf of
the Majority Lenders acting reasonably and having regard
to London market practice and the actual and projected
financial condition of the Group) after taking such
advice (at the cost of the Company) as the Facility Agent
may require.
(c) No member of the Group will repay, prepay, redeem or purchase any
of the Bonds prior to the Senior Discharge Date (as defined in the
Priority Agreement) or otherwise pay any amount due under the Bonds
other than for payments of scheduled interest when due.
21.37 Hedging
The Company will enter into, or will procure that another Obligor
enters into, Hedging Documents documenting the interest rate
hedging plan agreed between the Facility Agent and the Company
hedging interest payments on an amount equal to 75% of the
aggregate amount of the Tranche A Commitments, the Tranche B
Commitments, the Tranche C Commitments and the Tranche E
Commitments for a period of 4 years from the Closing Date within 30
days of the Closing Date.
21.38 Taxes
Each member of the Group will pay all Taxes due and payable by it
within a reasonable time of the relevant due date and in any event
before penalties attach thereto (save to the extent that payment of
the same is being contested in good faith and adequate reserves are
being maintained for those Taxes).
21.39 The Company and the Subordinated Borrower
Neither the Company nor the Subordinated Borrower will at any time
hold Cash or Cash Equivalent Investments in amounts greater than
that required for the next interest payment due under the
Subordinated Finance Documents and such other amounts as are
reasonably required for its other forecast cash requirements for
the next three months.
21.40 Acquisition Agreements
(a) The Company will, and will procure that each other member of the
Group which has a claim against any of the Vendors under the
Acquisition Agreement will, enforce its rights and pursue claims
under the Acquisition Agreements (if necessary by legal action) and
shall not waive or vary any of its material claims or rights
thereunder unless such claim is for an amount of less than
(pound)1,000,000 (or its equivalent in other currencies) and in the
reasonable opinion of the Company it is commercially beneficial not
to pursue such claim.
(b) On or prior to the Closing Date the Company will not (and no other
Obligor will) amend, vary or waive in any material respect any
provisions of the Acquisition Agreements or complete or elect to
complete the Acquisition in circumstances where it would be
entitled not to do so.
21.41 ERISA
Each U.S. Obligor will not, and will procure that none of its ERISA
Affiliates will:
(a) fail to make payment when due of all amounts due as a
contribution to any Plan, engage in any transaction in
connection with which any U.S. Obligor or any ERISA
Affiliate could be subjected to either a civil penalty
assessed pursuant to section 502(i) of ERISA, a tax
imposed by section 4975 of the IRC or breach of fiduciary
duty liability damages if, in any such case, such penalty
or tax or such liability, or the failure to make such
payment, or the existence of that deficiency, as the case
may be, would have a material adverse effect on the
business assets or financial condition of that U.S.
Obligor;
(b) (i) permit any Pension Plan to incur any "accumulated
funding deficiency" (within the meaning of Section 302 of
ERISA or Section 412 of the IRC), whether or not waived,
or (ii) at any time maintain, contribute to or be obliged
to contribute to any Multiemployer Plan or Pension Plan
which, upon the complete or partial withdrawal of the
U.S. Obligor or any ERISA Affiliate from such
Multiemployer Plan or the termination of such Pension
Plan, respectively, individually or in the aggregate,
would result in the imposition of complete or partial
withdrawal liability or other liability, respectively,
which would have a Material Adverse Effect.
21.42 Compliance with Margin Stock Regulation
Each U.S. Obligor shall not, and shall procure that its
Subsidiaries shall not:
(a) (i) sell, carry, pledge or otherwise dispose of any
margin stock ("Margin Stock") within the
meaning of Regulation U of the Board of
Governors of the Federal Reserve System of the
U.S.A., as in effect from time to time
("Regulation U"), now owned or acquired after
the date of this Agreement; or
(ii) incur any Borrowings directly or indirectly
secured (within the meaning of Regulation U) by
any Margin Stock;
if such transaction would cause any of the Advances or
any part thereof to be in violation of Regulation U, or
Regulation X of the Board of Governors of the Federal
Reserve System of the U.S.A., as in effect from time to
time ("Regulation X");
(b) use the proceeds of any Advance or Utilisation, directly
or indirectly, for the purpose, whether immediate,
incidental or ultimate, of purchasing or carrying any
Margin Stock or for the purpose of maintaining, reducing
or retiring any indebtedness which was originally
incurred to purchase or carry any stock that is currently
a Margin Stock or for any other purpose which might
constitute any of the Facilities or Utilisations or this
Agreement a "purpose credit" within the meaning of
Regulation U or Regulation X. No Obligor and no agent
acting on its behalf will take or has taken any action
which might cause this Agreement or the Advances to
violate Regulation U or Regulation X or any other
regulation of the Board of Governors of the Federal
Reserve System.
21.43 UCC filings
Each U.S. Obligor at its own expense will make and renew promptly,
and in any event in the case of renewal before any UCC filing
relating to any Finance Document expires, all UCC filings relating
to any Finance Document reasonably required by the Facility Agent
and will pay all applicable fees.
21.44 Re-organisation
The Company will procure that the proposed articles of amalgamation
for the amalgamated Canadian company (pursuant to the Canadian
Re-organisation) together with all supporting documents, are filed
at Industry Canada, Corporations Directorate in ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇, within seven days of the Closing Date.
21.45 PPSA filings
Each Obligor incorporated in Canada at its own expense will make
and renew promptly, and in any event in the case of renewal before
any PPSA filings relating to any Finance Document expires, all PPSA
filings relating to any Finance Document reasonably required by the
Facility Agent and will pay all applicable fees.
21.46 Creditors
Each Obligor will, and will procure that each of its Subsidiaries
shall, pay all material amounts outstanding to its trade creditors
substantially in accordance with the terms for payment applying to
such debts and in any event before such amounts become materially
overdue unless it (or such Subsidiary) is in good faith disputing
any amount payable.
21.47 Share certificates
The Company will procure that all share certificates (to the extent
not required to be delivered to the Facility Agent prior to
Closing) in respect of the entire issued share capital of those
members of the Group in respect of whose shares the Banks have, or
will, following execution of the Security Documents, have a charge,
are received by the Facility Agent within 21 days of the Closing
Date (or, if production of such share certificates is delayed due
to the Stamp Office adjudication process (or equivalent) only, as
soon as practicable).
22. Financial covenants
22.1 Definitions
(a) In this Agreement:
"Balance Sheet" means, at any time, the latest published audited
(or, prior to the delivery of an audited balance sheet, unaudited)
consolidated balance sheet of the Group.
"Consolidated Cash Flow" for any period means Consolidated EBIT for
such period:
(i) plus all depreciation, amortisation and other non-cash
charges deducted in establishing Consolidated EBIT for
such period or minus the amount of all provisions
released included in establishing Consolidated EBIT for
such period;
(ii) plus the proceeds of any subscription in cash for shares
in or subordinated loans made by the Investors to the
Company (which by their terms are not redeemable prior to
the Senior Discharge Date (as defined in the Priority
Agreement)) received by the Company (other than any such
subscription made pursuant to the Shareholders Agreement
which is not an Investors Capex Contribution Amount);
(iii) plus the amount of any tax rebate or credit in respect of
any advance corporation tax, mainstream corporation tax
or withholding tax or their equivalents in any relevant
jurisdiction actually received in cash by any member of
the Group during such period;
(iv) minus all Capital Expenditure (save to the extent funded
from amounts standing to the credit of the Disposals
Account) and all consideration and related acquisition
costs (other than Acquisition Costs in an aggregate
amount not exceeding (pound)30,000,000 (or its equivalent
in other currencies) for all periods since the Closing
Date) for all businesses, companies or shares acquired by
any member of the Group and the amount of all Joint
Venture Investments in each case actually paid or
contractually required to be paid by members of the Group
during such period;
(v) minus all advance corporation tax, mainstream corporation
tax and withholding tax actually falling due for payment
during such period;
(vi) plus the Original Sterling Amount of any Tranche E
Utilisations drawndown during such period less any amount
standing to the credit of the Capex Blocked Account on
the last day of such period;
(vii) plus the amount of any cash held by members of the Group
on the first day of such period after deducting therefrom
the aggregate of the Original Sterling Amount of any
Tranche D Utilisations and the Sterling Equivalent of any
Ancillary Outstanding and the Sterling Equivalent of any
other cash Borrowings made by members of the Group (not
being under the Finance Documents), in each case
outstanding on such day, provided that such sum shall not
be a negative number;
(viii) minus the amount of all dividends, redemptions and other
distributions paid or which have become due and payable
by any member of the Group during such period on, of or
in respect of any of its share capital not held by a
member of the Group;
(ix) minus (to the extent not taken into account in
calculating Consolidated EBIT for such period and not
otherwise deducted in this definition) all amounts paid
or contractually required to be paid by any member of the
Group to or for the account of any joint venture or other
person in which the Group has an ownership interest but
which is not a member of the Group during such period and
minus the amount by which profit of any joint ventures or
such other persons included in Consolidated EBIT for such
period exceeds the amount of such profit distributed or
otherwise made available in cash to members of the Group
during such period;
(x) minus any increase or plus any decrease in Consolidated
Net Working Investment between the Accounting Dates at
the beginning and end of such period;
(xi) plus all Restructuring Costs paid in cash by members of
the Group during such period;
(xii) minus the amount of any loans to, acquisitions of shares
or other investments in any Joint Venture made during
such period by any member of the Group which do not
constitute Joint Venture Investments and plus the amount
received in cash by any member of the Group during such
period in repayment or prepayment of any such loan or by
way of dividend or interest or redemption from any such
Joint Venture.
"Consolidated EBIT" for any period means the profit of the Group
for such period:
(i) before deducting advance corporation tax, mainstream
corporation tax and their equivalents in any relevant
jurisdiction;
(ii) before deducting amortisation of any goodwill arising
from the Acquisition or any other permitted acquisition
and the amortisation of any Acquisition Costs;
(iii) before taking into account Interest accrued as an
obligation of or owed to any member of the Group, in each
case whether or not paid, deferred or capitalised during
such period;
(iv) after deducting any gain over book value arising in
favour of the Group or before deducting any loss against
book value incurred by the Group on the sale, lease or
other disposal of any asset (other than on the sale of
trading stock) during such period and any gain arising on
revaluation of any asset during such period, in each case
to the extent that it would otherwise be taken into
account;
(v) after adding back currency exchange losses (to the extent
otherwise deducted) or after deducting currency exchange
gains (to the extent otherwise included) arising from the
conversion of assets or liabilities denominated in
currencies other than Sterling; and
(vi) after adding back to the extent deducted, Restructuring
Costs.
"Consolidated EBITDA" for any period means Consolidated EBIT for
such period before deducting any amortisation or depreciation.
"Consolidated Net Interest Payable" for any period means the
Interest accrued during such period as an obligation of any member
or members of the Group (whether or not paid or capitalised during
or deferred for payment after such period but after taking into
account Interest receivable (net of withholding Tax) by any member
of the Group on any bank deposits which is not more than 30 days
overdue, adjusted to take account of any amount constituting
Interest receivable by any members of the Group (after deducting
all withholding Taxes applicable thereto) under interest rate
and/or currency hedging agreements or instruments under which all
parties are in compliance with their material obligations.
"Consolidated Net Working Investment" as at any Accounting Date
means Consolidated Current Commercial Assets as at such Accounting
Date minus Consolidated Current Commercial Liabilities as at such
Accounting Date. For this purpose:
(i) "Consolidated Current Commercial Assets" as at any
Accounting Date means all of the current assets (other
than Cash, Cash Equivalent Investments, credits
receivable for advance corporation tax, mainstream
corporation tax or withholding tax suffered, Deferred
Costs, Interest receivable and repayments of Borrowings
within paragraphs (a), (c) or (i) of the definition of
that term in Clause 1.1) of the Group as at such
Accounting Date;
(ii) "Consolidated Current Commercial Liabilities" as at any
Accounting Date means all of the current liabilities
(excluding Borrowings within paragraph (a), (b), (c),
(d), (f), (g), (h) and (i) (unless consisting of a
liability in relation to items falling within paragraph
(e)) of the definition of Borrowings in Clause 1.1) and
any accrued or unpaid Interest and excluding any
liabilities payable in respect of advance corporation
tax, mainstream corporation tax and their equivalents in
any relevant jurisdiction and dividends, redemptions and
other distributions payable to shareholders of the
Company and any fee payable to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co
Limited by the Company pursuant to the Shareholders
Agreement and any other fees payable in connection with
the Acquisition or the financing thereof of the Group as
at such Accounting Date.
"Consolidated Net Worth" means at any time the aggregate of:
(i) the amount (including share premium amount) paid up or
credited as paid up on the issued share capital of the
Company;
(ii) the amount standing to the credit of the consolidated
revenue reserves of the Group (other than a reserve set
up for goodwill arising at Closing in respect of the
Acquisition and Acquisition Costs);
based on the Balance Sheet but:
(i) adding back (to the extent otherwise deducted) the amount
of any Acquisition Costs written off after Closing up to
an amount equal to (pound)30,000,000 (or its equivalent
in other currencies) plus all Security Costs or goodwill
arising on any acquisition permitted pursuant to Clause
21.15;
(ii) plus any amount standing to the credit and minus any
amount standing to the debit of the profit and loss
account for the Group for the period ending on the date
of the Balance Sheet (and adding back any goodwill
arising in respect of the Acquisition or any subsequent
acquisition permitted under Clause 21.15 written off
through the profit and loss account since the Closing
Date);
(iii) excluding any amount attributable to a revaluation of
assets (including, without limitation, intangibles) after
31st December, 1997 or, in the case of assets of a
company which becomes a member of the Group after the
Closing Date, the date on which that company becomes a
member of the Group;
(iv) before taking into account the effect on reserves of any
deferred tax which has been included in the annual profit
and loss account of the Group for any period ending on or
before the Balance Sheet date;
(v) minus (to the extent otherwise included) the amount
attributable to the interests of outside holders of any
issued share capital in any member of the Group other
than the Company;
(vi) minus the amount of any write-back of those provisions
and excluding fair value adjustment which existed or were
made on the Closing Date; and
(vii) provided that for the purpose of the calculation of
Consolidated Net Worth changes in the capital value of
assets and liabilities due to foreign exchange rate
movements which would not be included in the calculation
of Consolidated EBIT by virtue of paragraph (v) thereof
shall be disregarded and the Group's consolidated balance
sheet shall be adjusted to show Consolidated Net Worth
calculated in Sterling using the exchange rates used in
the preparation of the closing balance sheet prepared by
PricewaterhouseCoopers.
"Consolidated Total Debt Service" for any period means Consolidated
Net Interest Payable for such period:
(i) plus the amount of any reduction in any Repayment
Instalment which fell (or would otherwise have fallen)
due during such period caused by a mandatory prepayment
made pursuant to this Agreement in any previous period;
(ii) plus all Borrowings (excluding Borrowings within
paragraphs (d) and/or (e) of the definition of Borrowings
in Clause 1.1, documentary credits to the extent issued
in respect of trade credit only and excluding any
voluntary prepayments pursuant to Clause 9) of members of
the Group which fell due for repayment during such period
(whether or not paid during or deferred for payment after
such period), but excluding any principal amount which
fell due under any overdraft, working capital or
revolving credit facility and which was available for
simultaneous redrawing according to the terms of such
facility or of a similar facility or under the Tranche D
Facility.
"Restructuring Costs" means:
(i) those costs incurred by members of the Group in any
period in any reorganisation envisaged in the Structure
Memorandum, to the extent that the aggregate amount of
such costs in any period and any Restructuring Costs
incurred in any previous period do not exceed
(pound)250,000 (or its equivalent in other currencies);
(ii) any other non-recurring costs incurred by members of the
Group in an aggregate amount not exceeding (pound)250,000
(or its equivalent in other currencies) in any period and
(pound)1,000,000 (or its equivalent in other currencies)
in aggregate from the period from the Closing Date until
the Final Maturity Date involved in rationalising or
restructuring the business which would be considered as
exceptional costs under the Applicable Accounting
Principles and separately disclosed in the profit and
loss statement, and which have been charged in the profit
and loss account in arriving at Consolidated EBIT.
"Total Net Debt" at any time means the aggregate at that time of
all Borrowings of members of the Group (other than contingent
liabilities under any letter of credit, bond or guarantee save to
the extent that such contingent liability is backstopping an amount
of Borrowings which are then actually outstanding) minus the cash
or Cash Equivalent Investments held by members of the Group which
are Obligors.
"Total Net Senior Debt" at any time means the aggregate at that
time of all Borrowings of members of the Group under the Senior
Finance Documents (other than any contingent liability under any
Documentary Credit save to the extent that such contingent
liability is backstopping an amount of Borrowings which are then
actually outstanding) minus the cash or Cash Equivalent Investments
held by members of the Group which are Obligors.
(b) (i) All the terms defined in paragraph (a) above are to be
determined on a consolidated basis and (except as
expressly included or excluded in the relevant
definition) in accordance with the Applicable Accounting
Principles and as determined from the consolidated
Accounts of the Group for the relevant periods delivered
pursuant to Clause 21.2.
(ii) For the purposes of this Clause 22 no item shall be
deducted or credited more than once in any calculation.
22.2 Financial Covenants
The Obligors shall procure that:
(a) Consolidated EBIT to Consolidated Net Interest Payable:
Consolidated EBIT for any period comprising an annual
Accounting Period of the Group or four (or less taking
into account the provisions of Clause 22.4) consecutive
quarterly Accounting Periods of the Group (taken together
as one period) ending on any Accounting Date specified in
the table below, shall not be less than Y times
Consolidated Net Interest Payable for such period, where
Y has the value indicated for such Accounting Date in
such table:
Accounting Date (before any adjustment) Y
31st March, 1999 1.20
30th June, 1999 1.20
30th September, 1999 1.20
31st December, 1999 1.23
31st March, 2000 1.25
30th June, 2000 1.25
30th September, 2000 1.35
31st December, 2000 1.40
31st March, 2001 1.45
30th June, 2001 1.50
30th September, 2001 1.55
31st December, 2001 1.60
31st March, 2002 1.65
30th June, 2002 1.70
30th September, 2002 1.75
31st December, 2002 1.80
31st March, 2003 1.85
30th June, 2003 1.90
30th September, 2003 1.95
31st December, 2003 2.00
31st March, 2004 2.05
30th June, 2004 2.05
30th September, 2004 2.10
31st December, 2004 2.10
31st March, 2005 2.15
30th June, 2005 2.15
30th September, 2005 2.20
31st December, 2005 2.20
31st March, 2006 2.20
30th June, 2006 2.20
30th September, 2006 2.20
31st December, 2006 2.20
31st March, 2007 2.20
30th June, 2007 2.20
30th September, 2007 2.20
(b) Consolidated Cash Flow to Consolidated Total Debt Service:
Consolidated Cash Flow for any period comprising an
annual Accounting Period of the Group or four (or less
taking into account the provisions of Clause 22.4)
consecutive quarterly Accounting Periods of the Group
(taken together as one period) ending on any Accounting
Date specified in the table below, shall not be less than
Y times Consolidated Total Debt Service for such period,
where Y has the value indicated for such Accounting Date
in such table:
Accounting Date (before any adjustment) Y
31st March, 1999 1.00
30th June, 1999 1.00
30th September, 1999 1.00
31st December, 1999 1.00
31st March, 2000 1.00
30th June, 2000 1.00
30th September, 2000 1.00
31st December, 2000 1.00
31st March, 2001 1.00
30th June, 2001 1.00
30th September, 2001 1.00
31st December, 2001 1.00
31st March, 2002 1.00
30th June, 2002 1.00
30th September, 2002 1.00
31st December, 2002 1.00
31st March, 2003 1.00
30th June, 2003 1.00
30th September, 2003 1.00
31st December, 2003 1.00
31st March, 2004 1.00
30th June, 2004 1.00
30th September, 2004 1.00
31st December, 2004 1.00
31st March, 2005 1.00
30th June, 2005 1.00
30th September, 2005 1.00
31st December, 2005 1.00
31st March, 2006 1.00
30th June, 2006 1.00
30th September, 2006 1.00
31st December, 2006 1.00
31st March, 2007 1.00
30th June, 2007 1.00
30th September, 2007 1.00
(c) Total Net Debt to Consolidated Net Worth:
Total Net Debt shall not be more than Y times
Consolidated Net Worth of the Group on any of the
Accounting Dates in Column A below, where Y has the value
set out in Column B below opposite such Accounting Date:
Column A Column B
Accounting Date Consolidated Net Worth
30th June, 1999 3.00
31st December, 1999 2.85
30th June, 2000 2.70
31st December, 2000 2.60
30th June, 2001 2.50
31st December, 2001 2.40
30th June, 2002 1.80
31st December, 2002 1.80
30th June, 2003 1.50
31st December, 2003 1.50
30th June, 2004 1.50
31st December, 2004 1.50
30th June, 2005 1.50
31st December, 2005 1.50
30th June, 2006 1.50
31st December, 2006 1.50
30th June, 2007 1.50
(d) Total Net Senior Debt to Consolidated EBITDA:
Total Net Senior Debt as at each of the Accounting Dates
indicated in the table below shall not be more than Y
times Consolidated EBIT for any period comprising an
annual Accounting Period of the Group or four consecutive
quarterly Accounting Periods of the Group (taken together
as one period), where Y has the value indicated for such
Accounting Date in the table below:
Accounting Date (before any adjustment) Y
30th June, 1999 4.80
31st December, 1999 4.50
30th June, 2000 4.50
31st December, 2000 4.00
30th June, 2001 3.90
31st December, 2001 3.50
30th June, 2002 2.90
31st December, 2002 2.90
30th June, 2003 2.40
31st December, 2003 2.40
30th June, 2004 2.40
31st December, 2004 2.40
30th June, 2005 2.40
31st December, 2005 2.40
30th June, 2006 2.40
31st December, 2006 2.40
30th June, 2007 2.40
22.3 Capital Expenditure
(a) In respect of each period from the Closing Date to the date set out
in the first line of column (1) below and in respect of each of the
annual Accounting Periods ending on or about the dates set out in
the second line onwards of column (1) below (each an "Expenditure
Period") the Company will procure that the Group taken as a whole
will not (a) purchase, lease (by finance lease) or make Capital
Expenditure (save to the extent acquired or funded from amounts
standing to the credit of the Disposals Account) on assets or (b)
make Joint Venture Investments (excluding any Joint Venture
Investment in the ▇▇▇▇▇ Air Force Base Joint Venture or any Joint
Venture Investment permitted by Clause 21.34(a)(ii)), in an
aggregate amount for each such Expenditure Period in excess of one
hundred and fifteen per cent. (115%) of the amount set out in
column (2) below opposite the relevant Expenditure Period:
(1) (2)
Expenditure Period Capital Expenditure
(pound) (or equivalent in other currencies)
31st December, 1998 19,300,000
31st December, 1999 23,800,000
31st December, 2000 24,500,000
31st December, 2001 21,300,000
31st December, 2002 22,300,000
31st December, 2003 22,600,000
31st December, 2004 23,500,000
31st December, 2005 24,500,000
31st December, 2006 25,500,000
31st December, 2007 26,500,000
Provided that if for the relevant Expenditure Period referred to in
column (1) above the Company is in compliance with its obligations
under Clause 22.2 on the Accounting Date as at the end of such
Expenditure Period, up to 25 per cent. (25%) of the amount of any
such Capital Expenditure limit specified in column (2) not utilised
in any such Expenditure Period may be carried forward for one
Expenditure Period only and added (otherwise than for the purposes
of the further application of this proviso) to the Capital
Expenditure limit for the next Expenditure Period specified in
column (2).
(b) In respect of each period measured from the date on which members
of the Group first start making Joint Venture Investments in the
▇▇▇▇▇ Air Force Base Joint Venture (the "▇▇▇▇▇ Expenditure Period")
specified in Column (1) below the Company will procure that the
Group taken as a whole will not incur Capital Expenditure on or
make Joint Venture Investments in the ▇▇▇▇▇ Air Force Base Joint
Venture in an aggregate amount for each ▇▇▇▇▇ Expenditure Period in
excess of one hundred and fifteen per cent. (115%) of the amount
set out in Column (2) below opposite the relevant ▇▇▇▇▇ Expenditure
Period:
(1) (2)
▇▇▇▇▇ Expenditure Period Capital Expenditure
months from commencing Joint Venture Investments in (pound) (or equivalent in other currencies)
▇▇▇▇▇ Air Force Base Joint Venture agreement
0 - 12 8,700,000
12 - 24 2,200,000
24 - 36 1,300,000
36 - 48 1,300,000
48 - 60 1,300,000
60 - 72 1,300,000
72 - 84 1,300,000
84 - 96 1,300,000
96 - 108 1,300,000
22.4 Periods
(a) Where any of the periods referred to in Clauses 22.2 would
otherwise commence before the Closing Date, such period shall
instead commence on the Closing Date (and the part falling before
the Closing Date shall be ignored), subject to paragraph (b) below.
(b) The first period referred to in Clause 22.2(a) and (d) shall
commence on 1st April, 1998 and the second period shall commence on
1st July, 1998. For the purposes of Clause 22.2(a) where any period
commences before the Closing Date (such part of the period being
the "Pre-Closing Period") Consolidated Net Interest Payable shall
be deemed to have accrued during the Pre-Closing Period at the same
average daily rate as Consolidated Net Interest Payable accrued
during the part of such period falling on and after the Closing
Date, and the amount of Consolidated Net Interest Payable during
such period shall be calculated by the Company and agreed with the
Facility Agent accordingly (or in the absence of agreement shall be
as calculated by the Auditors).
23. DEFAULT
23.1 Events of Default
Each of the events set out in this Clause 23.1 is an Event of
Default (whether or not caused by any reason whatsoever outside the
control of any Obligor or any other person).
(a) Non-payment: an Obligor does not pay on the due date any
amount payable by it under any Senior Finance Document at
the place and in the funds and currency in which it is
expressed to be payable unless (i) the unpaid amount (not
being an amount of principal of or interest on any
Utilisation or any fee referred to in Clause 25) is paid
in full within 5 Business Days of demand, or (ii) the
Facility Agent is satisfied that the failure to pay is
due solely to technical or administrative delays in the
transmission of funds and the relevant amount is paid in
full within 3 Business Days of the due date; or
(b) Breach of other obligations: an Obligor does not comply
with any provision of:
(i) Clauses 21.6, 21.7, 21.8, 21.15, 21.17, 21.18,
21.19, 21.27(a)(i), 21.36 or 22.2; or
(ii) any Senior Finance Document (other than a
provision referred to in paragraphs (a) or
(b)(i) above) and, if such default is capable
of remedy within such period, within 21 days
after the earlier of the Company or any of the
Executives becoming aware of such default and
receipt by the relevant Obligor of written
notice from the Facility Agent requiring the
failure to be remedied, such Obligor shall have
failed to cure such default, provided that such
Obligor shall not have any such 21 day remedy
period where in the Facility Agent's reasonable
opinion it would be materially prejudicial to
the interests of the Lenders under the Senior
Finance Documents to wait to determine whether
or not such Obligor would remedy any such
failure; or
(c) Misrepresentation: a representation, warranty or
statement made or repeated by or on behalf of any Obligor
(in the case of statements, made in circumstances such
that the recipient could reasonably be expected to rely
on its accuracy), in any Senior Finance Document or in
any document delivered by or on behalf of any Obligor
under or in connection with any Senior Finance Document,
is incorrect in any respect when made or deemed to be
made or repeated by reference to the facts and
circumstances then subsisting and, if the facts and
circumstances causing such misrepresentation are in the
reasonable opinion of the Majority Lenders capable of
remedy within such period, within 21 days after the
earlier of the Company or any of the Executives becoming
aware of such misrepresentation and receipt by such
Obligor of written notice from the Facility Agent
requiring the facts and circumstances causing such
misrepresentation to be remedied, such Obligor shall have
failed to remedy such facts and circumstances; or
(d) Cross-default:
(i) any Borrowings of a member or any members of
the Group (taken together) aggregating
(pound)2,000,000 (or its equivalent in other
currencies) or more at any one time outstanding
become due and payable or due for redemption
before their normal maturity date by reason of
the occurrence of an event of default
(howsoever characterised) or any event having
the same effect; or
(ii) any Borrowings of any member or members of the
Group (taken together) aggregating
(pound)2,000,000 (or its equivalent in other
currencies) or more are not paid when due
(whether falling due by demand, at scheduled
maturity or otherwise) or within any applicable
grace period provided for in the original
document evidencing or constituting those
Borrowings; or
(iii) any Borrowings of a member or any members of
the Group (taken together) aggregating
(pound)5,000,000 (or its equivalent in other
currencies) or more at any one time outstanding
become capable of being declared due and
payable or due for redemption before their
normal maturity date or are placed on demand by
reason of the occurrence of an event of default
(howsoever characterised) or any event having
the same effect,
PROVIDED THAT for a period of 30 days from the Closing
Date there shall be no Default or Event of Default under
paragraph (d)(i) above if Borrowings of members of the
Group (taken together) aggregating more than
(pound)2,000,000 (or its equivalent in other currencies)
but less than (pound)10,000,000 (or its equivalent in
other currencies) have become capable of being declared
prematurely due and payable or are put on demand by
reason of a change of control of any member of the Target
Group or the transactions provided for in the Acquisition
Agreements but have not yet been demanded or become due
but unpaid, where an amount of the Tranche D Commitments
at least equal to the amount of such Borrowings capable
of being declared prematurely due and payable or which
have been put on demand is undrawn and PROVIDED FURTHER
THAT the terms of this proviso will not waive and are
without prejudice to any Default or Event of Default
which arises at the end of such 30 day period as a result
of any such Borrowings;
(e) Invalidity:
(i) any of the Finance Documents ceases to be in
full force and effect in any material respect
or, subject to the Reservations, (i) ceases to
constitute the legal, valid and binding
obligation of any Obligor party to it or, (ii)
in the case of any Security Document, fails to
provide valid and enforceable security in
favour of the Security Agent and the Lenders
over the assets over which security is intended
to be given by that Security Document, in each
case in a manner and to an extent reasonably
considered by the Majority Lenders to be
materially adverse to their interests under the
Senior Finance Documents and where, if such
unlawfulness is capable of remedy within such
period, within 21 days after the earlier of the
Company or any of the Executives becoming aware
of such unlawfulness and receipt by the
relevant Obligor of written notice from the
Facility Agent requiring the failure to be
remedied such Obligor shall have failed to cure
such unlawfulness, provided that such Obligor
shall not have any such 21 day remedy period
where in the Facility Agent's reasonable
opinion it would be materially prejudicial to
the interests of the Lenders under the Senior
Finance Documents to wait to determine whether
or not such Obligor would remedy any such
unlawfulness; or
(ii) it is unlawful for any Obligor to perform any
of its material obligations under any of the
Finance Documents (save to the extent that such
unlawfulness relates only to the obligations of
an Obligor under any of the Security Documents
and would not be reasonably likely materially
and adversely to affect the legality, validity
or enforceability of (A) any security over
shares, or (B) any assignment of or charge over
rights under the Acquisition Agreements or any
intra-Group loan set up at Closing, or (C) the
security (taken as a whole) given by a Material
Group Subsidiary) and where in the case of
unlawfulness affecting an Obligor's obligations
under a Security Document, if such unlawfulness
is capable of remedy within such period, within
21 days after the earlier of the Company or any
of the Executives becoming aware of such
unlawfulness and receipt by the relevant
Obligor of written notice from the Facility
Agent requiring the failure to be remedied such
Obligor shall have failed to cure such
unlawfulness, provided that such Obligor shall
not have any such 21 day remedy period where in
the Facility Agent's reasonable opinion it
would be materially prejudicial to the
interests of the Lenders under the Senior
Finance Documents to wait to determine whether
or not such Obligor would remedy any such
unlawfulness; or
(iii) any Obligor alleges in writing that any Finance
Document is ineffective or invalid; or
(f) Insolvency:
(i) any Obligor or any Material Group Subsidiary
is, or is deemed or declared for the purposes
of any law to be, unable to pay its debts as
they fall due or to be insolvent, or admits in
writing its inability to pay its debts as they
fall due, save where such Obligor or such
Material Group Subsidiary is deemed to be
insolvent solely under Section 123(1)(a) of the
Insolvency ▇▇▇ ▇▇▇▇ in circumstances where it
is contesting the relevant debt in good faith
and with due diligence; or
(ii) any Obligor or any Material Group Subsidiary
suspends making payments on all or any class of
its debts or announces an intention to do so,
or a moratorium is declared in respect of any
of its indebtedness; or
(iii) any Obligor or any Material Group Subsidiary by
reason of financial difficulties, begins
negotiations with its creditors generally with
a view to the readjustment or rescheduling of
any of its indebtedness; or
(g) Insolvency proceedings:
(i) any step (including petition, proposal or
convening a meeting) is taken by, or on behalf
of, any Obligor or any Material Group
Subsidiary with a view to a composition,
assignment or arrangement with any creditors of
any Obligor or any Material Group Subsidiary;
or
(ii) a meeting of any Obligor or any Material Group
Subsidiary is convened for the purpose of
considering any resolution for (or to petition
for) its winding-up or its administration or
any such resolution is passed (not being the
solvent liquidation of any Obligor or any
Material Group Subsidiary which is not an
Obligor and which would not have a Material
Adverse Effect); or
(iii) any person presents a petition for the
winding-up or for the administration of any
Obligor or any Material Group Subsidiary (not
being a frivolous or vexatious petition and not
being the solvent liquidation of any Obligor or
of any Material Group Subsidiary which is not
an Obligor and which would not have a Material
Adverse Effect); or
(iv) any order for the winding-up or administration
of any Obligor or any Material Group Subsidiary
is made (not being the solvent liquidation of a
member of the Group which is not an Obligor and
which would not have a Material Adverse
Effect); or
(v) any other step (including petition, resolution,
proposal or convening a meeting) is taken by or
on behalf of any Obligor or any Material Group
Subsidiary with a view to the rehabilitation,
administration, custodianship, liquidation,
winding-up or dissolution of any Obligor or any
Material Group Subsidiary or any other
insolvency proceedings involving any Obligor or
any Material Group Subsidiary,
save where (A) in the case of any such step or action,
other than the convening of a meeting to consider any
resolution or petition for its administration or the
presentation of a petition or making of an order for its
administration, the relevant Obligor or Material Group
Subsidiary demonstrates to the Majority Lenders'
satisfaction that the action has been dismissed or
revoked within 21 days, and (B) the Majority Lenders
(acting reasonably) are satisfied that it would not be
materially prejudicial to the interests of the Lenders
under the Senior Finance Documents to wait to determine
whether or not such step or action would be dismissed or
revoked within 21 days; or
(h) Appointment of receivers and managers:
(i) any liquidator, trustee in bankruptcy, judicial
custodian, compulsory manager, receiver,
administrative receiver, administrator or the
like is appointed in respect of any Obligor or
any Material Group Subsidiary or any material
part of its assets; or
(ii) the directors of any Obligor or any Material
Group Subsidiary requests the appointment of a
liquidator, trustee in bankruptcy, judicial
custodian, compulsory manager, receiver,
administrative receiver, administrator or the
like in respect of any Obligor or any Material
Group Subsidiary or its assets; or
(iii) any other steps are taken to enforce any
Encumbrance over any part of the assets of any
Obligor or any Material Group Subsidiary, save
where that Obligor or Material Group Subsidiary
is in good faith contesting such enforcement by
appropriate proceedings and the Majority
Lenders acting reasonably are satisfied that
the ability of any Obligor to comply with its
obligations under any Finance Document will not
be materially and adversely affected; or
(i) Creditors' process: any attachment, sequestration,
distress or execution affects any assets of any Obligor
or any Material Group Subsidiary having an aggregate
value of (pound)2,000,000 (or its equivalent in other
currencies), and is not discharged within 21 days; or
(j) U.S. Bankruptcy:
(i) any Obligor or any Material Group Subsidiary
shall commence a voluntary case under the U.S.
Bankruptcy Code, or an involuntary case is
commenced under the U.S. Bankruptcy Code
against that member and the petition is not
controverted within 10 days and is not
dismissed within 30 days, after commencement of
the case, or a custodian, receiver, trustee or
similar officer is appointed for, or takes
charge of, all or substantially all of the
property of that Obligor; or
(ii) any U.S. Obligor (A) is dissolved or
liquidated, or (B) fails or is unable to pay
its debts generally as they become due, or (C)
commences a voluntary case in bankruptcy or any
other action or proceeding for any other relief
under any law affecting creditors' rights that
is similar to a bankruptcy law or (D) consents
by answer or otherwise to the commencement
against it of an involuntary case in bankruptcy
or any other such action or proceeding; or a
court enters an order for relief or a decree in
an involuntary case in bankruptcy or any other
such action or proceeding, or a receiver,
trustee or similar official is appointed in
respect of any U.S. Obligor or any of its
respective property, and that order or decree
is not dismissed or stayed or that appointment
is not terminated, on or before the sixtieth
day after the entry of the order or decree or
after the appointment (as the case may be) or
any such dismissal or stay ceases to remain in
effect; or
(k) Analogous Proceedings: there occurs in relation to any
Obligor or any Material Group Subsidiary any event in any
jurisdiction in which such Obligor or such Material Group
Subsidiary is incorporated or carries on business which,
in the reasonable opinion of the Majority Lenders,
corresponds or is analogous to any of the events referred
to in paragraphs (f) to (j) inclusive above; or
(l) Insolvent Group Member: members of the Group, the
aggregate of whose gross assets, pre-tax profits or
turnover, exceeds five per cent. of the gross assets,
Consolidated EBIT or turnover, as the case may be, of the
Group become Insolvent Group Members in each case
calculated in accordance with the Applicable Accounting
Principles and by reference to the latest audited or
management accounts of the relevant members of the Group
prior to them becoming Insolvent Group Members and the
latest consolidated Accounts of the Group delivered
pursuant to Clause 21.2; or
(m) Ownership of the Obligors: any Obligor (other than the
Company) is not or ceases to be a wholly-owned Subsidiary
of the Company other than as contemplated by this
Agreement; or
(n) Control:
(i) any single person, or group of persons acting
in concert (as defined in the City Code of
Takeovers and Mergers) other than the Investors
initially party to the Shareholders Agreement
(or funds managed by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co.
Limited) acquires control (as defined in
Section 416 of the Income and Corporation Taxes
Act 1988) of the Company after the date of this
Agreement or becomes interested in shares
carrying the right to fifty per cent. or more
of the votes at general meetings of the
Company; or
(ii) funds managed by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Limited
cease to hold the largest economic interest in
the Company; or
(iii) funds managed by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Limited
and investors in any such funds cease to hold
in aggregate at least 50.1 per cent. of the
voting shares of the Company; or
(o) Proceedings: there shall occur any litigation,
arbitration, administrative, regulatory or other
proceedings or enquiry (including without limitation, any
such by any monopoly, anti-trust or competition authority
or commission, or any equivalent body in the European
Commission or any division of any thereof or authority
deriving power from any thereof) concerning or arising in
consequence of any of the Transaction Documents and/or
the implementation of any matter or transaction provided
for in the Transaction Documents and the same has in the
reasonable opinion of the Majority Lenders a Material
Adverse Effect or an effect which is, or is reasonably
likely to be, materially adverse to the legality,
validity or enforceability of any Security Document
providing for security over shares or the assignment of
(or charge over) rights under the Acquisition Agreements
or a material adverse effect on the legality, validity or
enforceability of the security (taken as a whole) granted
by any Material Group Subsidiary pursuant to the Security
Documents; or
(p) Rescission: any party to the Acquisition Agreements or
the Shareholders Agreement rescinds any of those
agreements where to do so would materially and adversely
affect the interest of the Lenders under the Senior
Finance Documents; or
(q) Priority Agreement: any party to the Priority Agreement
(other than a Finance Party) fails to comply with its
material obligations under the Priority Agreement and in
the reasonable opinion of the Majority Lenders the
interests of the Lenders under the Senior Finance
Documents are likely to be materially and adversely
affected; or
(r) Audit qualification: the Auditors qualify their report on
any audited consolidated Accounts of the Group or any
Material Group Subsidiary in a manner which is material
in the context of the Senior Finance Documents and the
transactions contemplated thereby; or
(s) Subordinated Debt: any event of default occurs under any
of the Subordinated Finance Documents; or
(t) ERISA:
(i) any U.S. Obligor or any Subsidiary of a U.S.
Obligor or any ERISA Affiliate has incurred or
is likely to incur a liability to or on account
of a Plan under that part of ERISA dealing with
fiduciary responsibility, Title IV of ERISA or
Section 4971 or 4975 of the Code, or any U.S.
Obligor or any Subsidiary has incurred or is
likely to incur liabilities pursuant to one or
more employee welfare benefit plans (as defined
in Section 3(1) of ERISA) subject to ERISA
which provide benefits to retired or terminated
employees (other than as required by Part 6 of
Subtitle B of Title I of ERISA) or employee
pension benefit plans (as defined in Section
3(2) of ERISA) subject to ERISA, and there
shall result from any such event or events the
imposition of a lien, the granting of a
security interest, or a liability or a material
risk of incurring a liability, which lien,
security interest or liability (or the
enforcement thereof) is reasonably likely to
have a Material Adverse Effect; or
(ii) any U.S. Obligor, any Subsidiaries of a U.S.
Obligor or any ERISA Affiliate shall have
committed a failure described in Section
302(f)(1) of ERISA or Section 412(n)(1) of the
Code and the amount determined under Section
302(f)(3) of ERISA or Section 412(n)(3) of the
Code in respect of such failure shall be equal
to or greater than (pound)2,000,000 (or its
equivalent in other currencies); or
(iii) any Reportable Event with respect to a Pension
Plan shall have occurred.
(u) Expropriation: the authority or ability of any Obligor or
any Material Group Company to conduct its business is
wholly or substantially curtailed by any seizure,
expropriation, nationalisation, intervention or other
action by or on behalf of any governmental or regulatory
authority; or
(v) Cessation: any Obligor or any Material Group Subsidiary
ceases, or threatens to cease to carry on all or a
substantial part of its business; or
(w) Security Documents: the Security Documents specified in
Schedule 7 Part II have not been executed by the relevant
members of the Group and delivered to the Security Agent
in each case in the agreed form, or any of the members of
the Group specified in Schedule 7 Part III have not
become an Additional Guarantor, in each case within 7
days of the Closing Date (and whether or not by reason of
any provision of law restricting or prohibiting the
relevant member of the Group from executing such Security
Documents or becoming an Additional Guarantor); or
(x) Material adverse change: any event or series of events
occurs which is, or is reasonably likely to be,
materially adverse to the business, assets or financial
condition of the Company and/or of any of the Operating
Divisions; or
(y) Listing: any of the shares in the Company or any shares
in any other member of the Group or in any Holding
Company of the Company are listed on any recognised or
reputable stock exchange or are sold or issued by way of
flotation or public offering.
23.2 Acceleration
On and at any time after the occurrence of an Event of Default
which is subsisting the Facility Agent may, and shall if so
directed by the Majority Lenders, by notice to the Obligors' Agent:
(a) declare that an Event of Default has occurred; and/or
(b) cancel the Total Commitments; and/or
(c) declare that all or part of the Advances to some or all
of the Borrowers be payable on demand, whereupon they
shall immediately become payable on demand by the
Facility Agent (and if any such demand is subsequently
made those Advances, together with accrued interest and
all other amounts accrued under this Agreement, shall be
immediately due and payable); and/or
(d) declare that all or part of the Advances to some or all
of the Borrowers, together with accrued interest, and all
other amounts accrued under this Agreement be immediately
due and payable, whereupon they shall become immediately
due and payable; and/or
(e) require the payment to the Facility Agent of a sufficient
sum to cover the Outstanding Liability Amounts under some
or all outstanding Documentary Credits issued for the
account of some or all of the Borrowers, whereupon the
same shall become immediately due and payable by the
relevant Borrowers and, once paid, shall be held by the
Facility Agent in an interest bearing account for
application in reimbursing the LC Bank or the Lenders
forthwith for all payments made or to be made under such
outstanding Documentary Credits,
Provided (I) that no action or determination by any of the Finance
Parties shall be required in respect of any or all of the
obligations and liabilities (whether actual or contingent) of any
Obligor upon or at any time after the occurrence of an Event of
Default specified in Clause 23.1(j)(ii) in respect of any U.S.
Obligor and on the occurrence of any such Event of Default all of
the obligations and liabilities of the Obligors shall become
automatically and immediately due and payable and, (II) provided
further that the Facility Agent (on the instructions of the
Majority Lenders) can by notice to the Obligors rescind any such
acceleration in whole or in part.
24. THE AGENTs AND THE ARRANGER
24.1 Appointment and duties of the Agents
Each Finance Party irrevocably appoints each Agent to act as its
agent under and in connection with the Finance Documents, and
irrevocably authorises each Agent on its behalf (a) to execute on
its behalf such of the Senior Finance Documents (and those
Documentary Credits) which are expressed by this Agreement to be
executed by such Agent on behalf of the Finance Parties, and (b) to
perform the duties and to exercise the rights, powers and
discretions that are specifically delegated to it under or in
connection with the Finance Documents, together with any other
incidental rights, powers and discretions. Each Agent shall have
only those duties which are expressly specified in this Agreement.
Those duties are solely of a mechanical and administrative nature.
24.2 Role of the Arranger
Except as otherwise provided in this Agreement, the Arranger has no
obligation of any kind to any other Party under or in connection
with any Finance Document.
24.3 Relationship
The relationship between each Agent and the other Finance Parties
is that of agent and principal only. Nothing in this Agreement
(other than in relation to the Security Agent and the Security
Documents) constitutes any Agent as trustee or fiduciary for any
other Party or any other person and except where and to the extent
otherwise stated in this Agreement such Agent need not hold in
trust any moneys paid to it for a Party or be liable to account for
interest on those moneys.
24.4 Majority Lenders' directions
Each Agent will be fully protected if it acts in accordance with
the instructions of the Majority Lenders in connection with the
exercise of any right, power or discretion or any matter not
expressly provided for in the Finance Documents. Any such
instructions given by the Majority Lenders will be binding on all
the Lenders. In the absence of such instructions each Agent may act
as it considers to be in the best interests of all the Lenders.
24.5 Delegation
Each Agent may act under the Finance Documents through its
personnel and agents.
24.6 Responsibility for documentation
Neither any Agent nor the Arranger is responsible to any other
Party for:
(a) the execution, genuineness, validity, enforceability or
sufficiency of any Finance Document or any other
document;
(b) the collectability of amounts payable under any Finance
Document; or
(c) the accuracy of any statements (whether written or oral)
made in or in connection with any Finance Document (or in
any Report or information memorandum).
24.7 Default
(a) No Agent is obliged to monitor or enquire as to whether or not a
Default has occurred. No Agent will be deemed to have knowledge of
the occurrence of a Default. However, if an Agent receives notice
from a Party referring to this Agreement, describing the Default
and stating that the event is a Default, it shall promptly notify
the Lenders.
(b) Each Agent may require the receipt of security satisfactory to it
whether by way of payment in advance or otherwise, against any
liability or loss which it may incur in taking any proceedings or
action arising out of or in connection with any Finance Document
before it commences those proceedings or takes that action.
24.8 Exoneration
(a) Without limiting paragraph (b) below, no Agent will be liable to
any other Party for any action taken or not taken by it under or in
connection with any Finance Document, unless directly caused by its
gross negligence or wilful misconduct.
(b) No Party may take any proceedings against any officer, employee or
agent of any Agent in respect of any claim it might have against
such Agent or in respect of any act or omission of any kind
(including gross negligence or wilful misconduct) by that officer,
employee or agent in relation to any Finance Document.
24.9 Reliance
Each Agent may:
(a) rely on any notice or document believed by it to be
genuine and correct and to have been signed by, or with
the authority of, the proper person;
(b) rely on any statement made by a director or employee of
any person regarding any matters which may reasonably be
assumed to be within his knowledge or within his power to
verify; and
(c) engage, pay for and rely on legal or other professional
advisers selected by it (including those in such Agent's
employment and those representing a Party other than such
Agent).
24.10 Credit approval and appraisal
Without affecting the responsibility of any Obligor for information
supplied by it or on its behalf in connection with any Finance
Document, each Lender confirms that it:
(a) has made its own independent investigation and assessment
of the financial condition and affairs of each Obligor
and its related entities in connection with its
participation in this Agreement and has not relied
exclusively on any information provided to it by any
Agent or the Arranger in connection with any Finance
Document; and
(b) will continue to make its own independent appraisal of
the creditworthiness of each Obligor and its related
entities while any amount is or may be outstanding under
the Finance Documents or any Commitment is in force.
24.11 Information
(a) The Facility Agent shall promptly forward to the person concerned
the original or a copy of any document which is delivered to the
Facility Agent by a Party for that person.
(b) Each Agent shall, at the cost of the Company, promptly supply a
Lender with a copy of each document received by such Agent under
Clauses 4, 19.1(d) or 19.2(a) upon the request of that Lender.
(c) Except where this Agreement specifically provides otherwise, no
Agent is obliged to review or check the accuracy or completeness of
any document it forwards to another Party.
(d) Except as provided above, neither any Agent nor the Arranger has
any duty:
(i) either initially or on a continuing basis to provide any
Lender with any credit or other information concerning
the financial condition or affairs of any Obligor or any
related entity of any Obligor whether coming into its
possession or that of any of its related entities before,
on or after the date of this Agreement; or
(ii) unless specifically requested to do so by a Lender where
the Facility Agent or such Lender is entitled to request
such certificates, documents or information in accordance
with this Agreement, to request any certificates or other
documents or information from any Obligor.
24.12 The Agents and Arranger individually
(a) If it is also a Lender, each Agent and the Arranger has the same
rights and powers under this Agreement as any other Lender and may
exercise those rights and powers as though it were not an Agent or
the Arranger, as the case may be.
(b) Each Agent and the Arranger may:
(i) carry on any business with any Obligor or its related
entities;
(ii) act as agent or trustee for, or in relation to any
financing involving, any Obligor or its related entities;
and
(iii) retain any fees, profits or remuneration in connection
with its activities under this Agreement or in relation
to any of the foregoing.
24.13 Indemnities
(a) Without limiting the liability of any Obligor under the Finance
Documents, each Lender shall forthwith on demand indemnify each
Agent for its proportion of any liability or loss incurred by such
Agent in any way relating to or arising out of its acting as an
Agent, except to the extent that the liability or loss arises
directly from such Agent's negligence or wilful misconduct.
(b) A Lender's proportion of the liability or loss set out in paragraph
(a) above is the proportion which its participation in the
Utilisations (if any) bear to all the Utilisations on the date of
the demand. If, however, there are no Utilisations outstanding on
the date of demand, then the proportion will be the proportion
which its Commitment bears to the Total Commitments at the date of
demand or, if the Total Commitments have been cancelled, bore to
the Total Commitments immediately before being cancelled.
(c) The Company shall forthwith on demand reimburse each Lender for any
payment made by it under paragraph (a) above.
24.14 Compliance
(a) Each Agent may refrain from doing anything which might, in its
opinion, constitute a breach of any law or regulation or be
otherwise actionable at the suit of any person, and may do anything
which, in its opinion, is necessary or desirable to comply with any
law or regulation of any jurisdiction.
(b) Without limiting paragraph (a) above, no Agent need disclose any
information relating to any Obligor or any of its related entities
if the disclosure might, in the opinion of such Agent, constitute a
breach of any law or regulation or any duty of secrecy or
confidentiality or be otherwise actionable at the suit of any
person.
24.15 Resignation
(a) Notwithstanding Clause 24.1, each Agent may resign (after
consultation with the Company) by giving notice to the Lenders and
the Company and may be removed by the Majority Lenders giving
notice to such Agent and the Company. In that event the Majority
Lenders, after consultation with the Company, may appoint a
successor (a "Replacement") for such Agent which shall be a
reputable and experienced bank, incorporated in England or having a
branch in London.
(b) If the Majority Lenders have not, within 30 days after any such
notice, so appointed a Replacement which shall have accepted such
appointment, the retiring Agent, after consultation with the
Company, shall have the right to appoint a Replacement which shall
be a reputable and experienced Lender incorporated in England or
having a branch in London.
(c) The resignation of the retiring Agent and the appointment of any
Replacement shall, subject to Clause 24.15(d), both become
effective upon the Replacement notifying all the parties hereto in
writing that it accepts such appointment, whereupon the Replacement
shall succeed to the position of the retiring Agent and the term
"Agent", "Facility Agent" or "Security Agent" in all of the Senior
Finance Documents shall include such Replacement where appropriate.
This Clause 24 shall continue to benefit a retiring Agent in
respect of any action taken or omitted by it hereunder while it was
an Agent.
(d) The resignation or removal of a Security Agent shall not become
effective until the Facility Agent is satisfied that all things
required to be done in order that the Security Documents or
replacements therefor shall provide for effective and perfected
security in favour of the replacement Security Agent have been
done. The Obligors shall take such action as the Facility Agent may
reasonably require in order that the Security Documents or
replacements therefor shall provide for effective and perfected
security in favour of any replacement Security Agent.
(e) The retiring Agent shall make available to the Replacement such
documents and records as the Replacement may reasonably request for
the purpose of performing its function as the Facility Agent or
Security Agent as the case may be.
24.16 Security Agent as Trustee
(a) The Security Agent in its capacity as trustee or otherwise:
(i) shall not be liable for any failure, omission, or defect
in perfecting the security constituted by any Security
Document or any security created thereby;
(ii) may accept without enquiry such title as any Obligor may
have to the property over which security is intended to
be created by any Security Document.
(b) Save where the Security Agent holds a legal mortgage over, or over
an interest in, real property or shares, the Security Agent in its
capacity as trustee or otherwise shall not be under any obligation
to hold any title deeds, Security Documents or any other documents
in connection with the property charged by any Security Document or
any other such security in its own possession or to take any steps
to protect or preserve the same. The Security Agent may permit the
relevant Obligor to retain all such title deeds and other documents
in its possession.
(c) Save as otherwise provided in the Security Documents, all moneys
which under the trusts herein or therein contained are received by
the Security Agent in its capacity as trustee or otherwise may be
invested in the name of or under the control of the Security Agent
in any investment for the time being authorised by English law for
the investment by trustees of trust money or in any other
investments which may be selected by the Security Agent with the
consent of the Majority Lenders. Additionally, the same may be
placed on deposit in the name of or under the control of the
Security Agent at such bank or institution (including any Agent)
and upon such terms as the Security Agent may think fit. Any and
all such monies and all interest thereon shall be paid over to the
Facility Agent forthwith upon demand by the Facility Agent.
(d) Each Finance Party authorises, empowers and directs the Security
Agent (by itself or by such person(s) as it may nominate) to
execute and enforce the Security Documents as trustee or as
otherwise provided (and whether or not expressly in the Finance
Parties' names) on its behalf.
24.17 Lenders
(a) Each Agent may treat each Lender as a Lender, entitled to payments
under this Agreement and as acting through its Facility Office(s)
until it has received not less than 5 Business Days' notice from
such Lender to the contrary prior to the relevant payment.
(b) Each Lender represents to the Facility Agent that, in the case of a
Lender which is a Lender on the date of this Agreement, on the date
of this Agreement and, in the case of a Lender which becomes a
Lender after the date of this Agreement, on the date it becomes a
Lender it is:
(i) either:
(A) not resident in the United Kingdom for United
Kingdom tax purposes; or
(B) a "bank" as defined in section 840A of the
Income and Corporation Taxes Act 1988 and
resident in the United Kingdom; and
(ii) beneficially entitled to the principal and interest
payable by the Facility Agent to it under this Agreement,
and shall forthwith notify the Facility Agent if either
representation ceases to be correct.
24.18 Co-Security Agents
(a) The Security Agent may appoint any person established or resident
in any jurisdiction (whether a trust corporation or not) to act
either as a separate security agent or a co-security agent jointly
with the Security Agent (i) if the Security Agent considers that
without such appointment the interests of the Finance Parties under
the Senior Finance Documents would be materially and adversely
affected or (ii) for the purposes of conforming to any legal
requirements, restrictions or conditions in any jurisdiction in
which any particular act or acts is or are to be performed or (iii)
for the purposes of obtaining a judgment in any jurisdiction or the
enforcement in any jurisdiction of either a judgment already
obtained or any of the provisions of the Senior Finance Documents,
provided in each case that such separate security agent or
co-security agent becomes bound by the terms of the Priority
Agreement as if it were the Security Agent.
(b) Each separate security agent or co-security agent shall (subject
always to the provisions of the Priority Agreement) have such
trusts, powers, authorities and discretions (not exceeding those
conferred on the Security Agent by this Agreement) and such duties
and obligations as shall be conferred or imposed by the instrument
of appointment.
(c) The costs, charges and expenses properly incurred by such separate
security agent in performing its function as such shall be treated
as costs, charges and expenses incurred by the Security Agent.
25. FEES
25.1 Arrangement fee
The Company shall pay to the Arranger on the Closing Date an
arrangement fee in the amount agreed in the letter dated on or
before the Signing Date from the Facility Agent on behalf of the
Arranger to the Company and counter-signed by the Company. The
arrangement fee shall be distributed by the Arranger among the
Lenders in the proportions agreed between the Arranger and the
Lenders. No arrangement fee shall be payable if Closing does not
occur.
25.2 Commitment fee
(a) The Company shall pay to the Facility Agent for each Lender a
commitment fee in Sterling computed at the rate of zero point seven
five per cent. (0.75%) per annum on the daily unutilised balance of
that Lender's Tranche A Commitment, Tranche B Commitment and
Tranche C Commitment during the period from the date six weeks
after the date of this Agreement to (and including) the Closing
Date.
(b) The Company shall pay to the Facility Agent for each Lender a
commitment fee in Sterling computed at the rate of zero point seven
five per cent. (0.75%) on the undrawn, uncancelled amount of such
Lender's Tranche D Commitment and Tranche E Commitment during the
period from the earlier of the date six weeks after the date of
this Agreement and the Closing Date to (and including) the last day
of the Tranche D Availability Period or the Tranche E Availability
Period (as the case may be) or the date on which the Tranche D
Commitments or the Tranche E Commitments (as the case may be) are
cancelled in full.
(c) Accrued commitment fee is payable to the Facility Agent quarterly
in arrear (the first payment being due on the Closing Date) and
also for any Lender on the cancelled amount of its Commitment at
the time the cancellation takes effect.
(d) The Company shall not be obliged to pay any of the commitment fees
set out in this Clause 25.2 if Closing does not occur.
25.3 Agency fees
The Company shall pay to the Facility Agent for the account of the
Agents the agency fees on the dates and in the amount agreed in the
letter dated on or before the Signing Date from the Facility Agent
to the Company and counter-signed by the Company. No agency fee
shall be payable if Closing does not occur.
25.4 Documentary Credit Issuance Fee
Each Borrower shall pay to the Facility Agent (for its own account)
on the Utilisation Date in respect of each syndicated Documentary
Credit an administration fee of (pound)1,000.
25.5 Documentary Credit per annum Fee
Each Borrower shall pay to the Facility Agent for application by it
as agreed between it and the Lenders a fee equivalent to the
aggregate of:
(a) the Margin applied on the face amount of each Documentary
Credit issued at its request; and
(b) (in the case only of Documentary Credits issued by the LC
Bank) an additional point one two five per cent. (0.125%)
per annum applied on that portion of the face amount of
each Documentary Credit for which the LC Bank is
counter-indemnified by the Lenders (other than itself
where the LC Bank is also the Lender) pursuant to Clause
5.7,
in each case in respect of the period between the date of issue of
the Documentary Credit and the earlier of its Expiry Date and the
date on which its Outstanding Liability Amount has been reduced to
nil.
The fee shall be payable quarterly in arrears and on the Expiry
Date of such Documentary Credit.
25.6 VAT
Any fee referred to in this Clause 25 (Fees) is exclusive of any
value added tax or any other Tax which might be chargeable in
connection with that fee. If any value added tax or other Tax is so
chargeable, it shall be paid in addition by the relevant Obligor at
the same time as it pays the relevant fee.
26. EXPENSES
26.1 Initial and special costs
The Company shall promptly on demand pay or procure that the other
Borrowers pay the Agents and the Arranger the amount of all
reasonable costs and expenses (including legal and notarial fees
and expenses) incurred by any of them in connection with:
(a) due diligence visits, the negotiation, preparation,
printing and execution of this Agreement and any other
Senior Finance Document (including any executed after the
date of this Agreement) or any Documentary Credit and the
syndication of the Facilities subject to any limit
previously agreed in writing the between the Arranger and
the Company;
(b) any amendment, supplement, waiver, consent or suspension
of rights (or any proposal for any of the foregoing)
requested by or on behalf of an Obligor or, in the case
of Clause 2.5, the Facility Agent and relating to a
Senior Finance Document; and
(c) any other matter, not of an ordinary administrative
nature, arising out of or in connection with a Senior
Finance Document,
together in each case with any applicable value added tax or other
Taxes.
26.2 Enforcement costs
The Company shall promptly on demand pay or procure that the other
Borrowers pay to each Finance Party the amount of all costs and
expenses (including legal fees and expenses) incurred by it:
(a) in connection with the enforcement of, or the
preservation of any rights under, any Senior Finance
Document; or
(b) (in the case of any Agent only) reasonable costs in
investigating any Default where such Agent has reasonable
grounds for believing that a Default has, or may have,
occurred,
together in each case with any applicable value added tax or other
Taxes.
While any Event of Default is continuing, the Company shall
promptly on demand pay each Agent for the reasonable cost of the
management time charged (on the basis of an hourly rate) by such
Agent in connection with any additional administration of the
Senior Finance Documents arising in consequence of such Event of
Default.
26.3 Stamp Duties
The Company shall pay and promptly on demand indemnify each Finance
Party against any liability it incurs in respect of any stamp,
registration and similar Tax which is or becomes payable in
connection with the entry into, registration, performance or
enforcement of any Finance Document.
27. INDEMNITIES
27.1 Currency Indemnity
(a) If any amount payable by any Obligor under or in connection with
any Senior Finance Document is received by any Finance Party in a
currency (the "Payment Currency") other than that agreed to be
payable under that Senior Finance Document (the "Agreed Currency"),
whether as a result of any judgment or order or the enforcement of
the same, the liquidation of such Obligor or otherwise and the
amount produced by converting the Payment Currency so received into
the Agreed Currency at market rates prevailing at or about the time
of receipt of the Payment Currency is less than the amount of the
Agreed Currency due under that Senior Finance Document, then the
Obligors shall, as an independent and additional obligation,
indemnify each Finance Party for the deficiency and any loss
sustained as a result.
(b) The indemnities set out in paragraph (a) above shall constitute
separate and independent obligations of each of the Obligors from
their other obligations under the Senior Finance Documents and
shall apply irrespective of any indulgence granted by any Finance
Party. The Obligors shall pay the reasonable costs of making any
conversion from the Payment Currency to the Agreed Currency.
(c) Each Obligor waives any right it may have in any jurisdiction to
pay any amount under this Agreement in a currency other than that
in which it is expressed to be payable under that Senior Finance
Document.
27.2 General Indemnities
The Company shall promptly on demand indemnify each Finance Party
against any loss, costs or liability which that Finance Party
incurs as a consequence of:
(a) the occurrence of any Default;
(b) the operation of Clause 2.5, Clause 23.2 or Clause 33;
(c) any payment of principal of or interest on an Advance or
of an overdue amount being received otherwise than on its
Interest Date;
(d) (other than by reason of default by a Finance Party) a
Utilisation not being made after a Request has been
delivered for that Utilisation; or
(e) acting in accordance with any telex or facsimile
instructions purporting to be from the Obligors' Agent or
any Obligor,
including any loss of Margin or other loss or expense on account of
funds borrowed, contracted for or utilised to fund any amount
payable under any Finance Document, any amount repaid or prepaid or
any Advance (provided that the loss or liability recoverable by any
Finance Party under paragraphs (c) or (d) shall not exceed the
amount which such Finance Party could claim if it had funded such
Advance or overdue amount on a matched basis in the London
Interbank Eurocurrency Market).
27.3 Indemnity Relating to Facilities
The Company agrees to indemnify each Finance Party and each of
their respective directors, officers and employees against any and
all claims, damages, liabilities, costs and expenses (including
legal fees) which may be incurred by or asserted against such
Finance Party or their respective directors, officers and employees
in connection with or arising out of any such proceedings, actions
or enquiry by any regulatory authority of a type referred to in
Clause 23.1(n) (ignoring the provision as to materiality contained
therein) or any litigation or other proceedings connected with the
right to transfer the Acquired Assets (or any part thereof), or the
shares of any member of the Target Group under the Transaction
Documents or any competing rights to the Acquired Assets (or any
part thereof), or to any of the Shares, provided that this
indemnity shall not extend to any claim, damage, liability cost or
expense arising out of such Finance Parties' negligence or wilful
misconduct or that of their respective directors, officers and
employees including any breach of any law, regulation or official
directive with which it was, at the time of such breach, the
practice of banks in its jurisdiction to comply.
28. EVIDENCE AND CALCULATIONS
28.1 Accounts
Accounts maintained by a Finance Party in connection with this
Agreement are prima facie evidence of the matters to which they
relate.
28.2 Certificates and determinations
Any certification or determination by a Finance Party of a rate or
amount under this Agreement is, in the absence of manifest error,
conclusive evidence of the matters to which it relates.
28.3 Calculations
Interest and the fees payable under Clauses 25.2 and 25.5 accrue
from day to day and are calculated on the basis of the actual
number of days elapsed and a year of 360 days (or 365 days in the
case of any amount denominated in Sterling or Belgian Francs or any
other currency in respect of which interest is customarily
calculated on the basis of a year of 365 days in the London
Interbank Market).
28.4 Certification
No person who, acting in good faith, gives a certificate on behalf
of an Obligor under the Senior Finance Documents shall incur any
personal liability by virtue of so doing save to the extent such
person acted fraudulently or with gross negligence in giving such
certificate.
28.5 Language
The original English language version of this Agreement shall
prevail over any transactions hereof. All notices and other
communications and documents (other than where necessary any
Security Document) to be delivered hereunder shall be in the
English language.
28.6 Interest Act (Canada)
Without prejudice to Clauses 10.6 and 28.3 and without in any way
affecting or altering the calculation of interest under this
Agreement, in respect of Utilisations made available to Borrowers
incorporated in Canada each rate of interest which is calculated
with reference to a period (the "deemed interest period") that is
less than the actual number of days in the calendar year of
calculation is, for the purposes of the Interest Act (Canada),
equivalent to a rate based on a calendar year calculated by
multiplying such rate of interest by the actual number of days in
the calendar year of calculation and dividing by the number of days
in the deemed interest period.
29. AMENDMENTS AND WAIVERS
29.1 Procedure
(a) Subject to Clause 29.2, if authorised by the Majority Lenders, the
Facility Agent or (in the case of the Security Documents) the
Security Agent may waive or (with the consent of the Obligors'
Agent) amend or vary any term of the Senior Finance Documents. Any
such waiver, amendment or variation so authorised and effected
shall be binding on all the Finance Parties and the Facility Agent
(or Security Agent as the case may be) shall be under no liability
in respect of any such waiver, amendment or variation.
(b) The Facility Agent shall promptly notify the Obligors' Agent and
the other Finance Parties of any waiver, amendment or variation
effected under paragraph (a) above, and any such waiver, amendment
or variation shall be binding on all the Parties.
29.2 Exceptions
A waiver, amendment or variation which relates to:
(a) the definition of "Majority Lenders" in Clause 1.1;
(b) an extension of the date for, or a decrease in an amount
or a change in the currency or waiver of, any payment
under the Senior Finance Documents;
(c) a change in a Lender's Commitment or an extension of any
Availability Period;
(d) the incorporation of Additional Borrowers and/or drawers
or a change in the Guarantors otherwise than in
accordance with Clauses 19.1 or 19.2;
(e) a term of a Senior Finance Document which expressly
requires the consent of each Lender;
(f) Clauses 8, 9, 12.6, 33, 38 or this Clause 29;
(g) any variation as to the ranking of Senior Debt (as
defined in the Priority Agreement) or any individual
Advance or Utilisation or of Clause 15 of the Priority
Agreement; or
(h) any release of any material security constituted or
evidenced by or any amendment or waiver of a material
provision of any Security Document or any release of
security over shares charged by any of the Security
Documents (save where such disposal is expressly
permitted by Clause 21.8(a) or any other provision of
this Agreement) save where such amendment or waiver is
made to correct any inconsistency between the relevant
Security Documents and the provisions of this Agreement
or the Agreed Security Principles,
may not be effected without the consent of each Lender.
29.3 Waivers and remedies cumulative
The rights of each Finance Party under the Senior Finance Documents:
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under the
general law; and
(c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is not a
waiver of that right.
30. CHANGES TO THE PARTIES
30.1 Transfers by Obligors
No Obligor may assign, transfer, novate or dispose of any of, or
any interest in, its rights and/or obligations under this
Agreement.
30.2 Transfers by Lenders
(a) A Lender (the "Existing Lender") may at any time, with the prior
consent of the Company (not to be unreasonably withheld or delayed
and to be deemed to have been given if the Company has not notified
the Facility Agent that it does not so consent within 10 Business
Days of receipt by the Company of a request for such consent),
assign, transfer or novate any of its rights and/or obligations
under this Agreement to another bank, trust or financial
institution (the "New Lender"), provided that no such consent by
the Company will be required where the New Lender is:
(i) an Affiliate of the Existing Lender; or
(ii) a Lender.
Unless the Facility Agent otherwise agrees, any partial assignment,
transfer or novation must be in a minimum amount of at least
(pound)2,000,000.
(b) A transfer of obligations will be effective only if either:
(i) the obligations are novated in accordance with Clause
30.3 (Procedure for novation); or
(ii) the New Lender confirms to the Facility Agent and the
Company that it undertakes to be bound by the terms of
the Senior Finance Documents as a Lender in form and
substance satisfactory to the Facility Agent. On the
transfer becoming effective in this manner the Existing
Lender shall be relieved of its obligations under the
Senior Finance Documents to the extent that they are
transferred to the New Lender.
(c) Nothing in this Agreement restricts the ability of a Lender to
sub-participate or sub-contract an obligation if that Lender
remains liable under this Agreement for that obligation.
(d) Save where the Existing Lender is an Original Lender, on each
occasion an Existing Lender assigns, transfers or novates any of
its rights and/or obligations under this Agreement, the New Lender
shall, on the date the assignment, transfer and/or novation takes
effect, pay to the Facility Agent an administration fee of
(pound)1,000 and the amount of all third party costs and expenses
(together with any applicable value added tax) incurred by the
Facility Agent in connection with such assignment, transfer or
novation.
(e) Neither an Existing Lender nor any other Finance Party is
responsible to a New Lender for:
(i) the execution, genuineness, validity, enforceability or
sufficiency of any Finance Document or any other
document;
(ii) the collectability of amounts payable under any Finance
Document or the financial condition of or the performance
of its obligations under the Finance Documents by any
Obligor; or
(iii) the accuracy of any statements or information (whether
written or oral) made in or in connection with or
supplied in connection with any Finance Document.
(f) Each New Lender confirms to the Existing Lender and the other Finance
Parties that it:
(i) has made its own independent investigation and assessment
of the financial condition and affairs of each Obligor
and its related entities in connection with its
participation in this Agreement and has not relied
exclusively on any information provided to it by the
Existing Lender or any other Finance Party in connection
with any Finance Document;
(ii) will continue to make its own independent appraisal of
the creditworthiness of each Obligor and its related
entities while any amount is or may be outstanding under
this Agreement or any Commitment is in force; and
(iii) is a bank, trust or financial institution whose ordinary
business includes participation in syndicated facilities
of this type.
(g) Nothing in any Finance Document obliges an Existing Lender to:
(i) accept a re-transfer from a New Lender of any of the
rights and/or obligations assigned, transferred or
novated under this Clause 30.2 or Clause 30.3; or
(ii) support any losses incurred by the New Lender by reason
of the non-performance by any Obligor of its obligations
under this Agreement or otherwise.
(h) Any reference in this Agreement to a Lender includes a New Lender,
but excludes a Lender if no amount is or may be owed to or by that
Lender under this Agreement and its Commitment has been cancelled
or reduced to nil.
30.3 Procedure for novation
(a) A novation of rights and obligations is effected if:
(i) the Existing Lender and the New Lender deliver to the
Facility Agent a duly completed Substitution Certificate
executed by the Existing Lender and the New Lender and
the Facility Agent executes it; or
(ii) a Novation Agreement substantially in the form of Part IV
of Schedule 6 is executed by all of the parties to it.
(b) Each Party (other than the Existing Lender and the New Lender)
irrevocably authorises the Facility Agent to execute any duly
completed Substitution Certificate in the form of Part I of
Schedule 6 on its behalf. Each Obligor irrevocably authorises the
Company to execute any duly completed Novation Agreement on its
behalf.
(c) To the extent that they are expressed to be the subject of the
novation in the Substitution Certificate or a Novation Agreement
each of the Obligors and each of the Lenders agree that:
(i) the Existing Lender and the other Parties (the "existing
Parties") will be released from their obligations to each
other under the Senior Finance Documents (the "released
obligations"), except for any obligation which the
Existing Lender has to the LC Bank pursuant to Clause 5.7
in respect of Documentary Credits issued prior to the
date on which such assignment and transfer takes effect
as determined below unless otherwise agreed in writing by
the LC Bank;
(ii) the New Lender and the existing Parties will assume
obligations towards each other under the Senior Finance
Documents which differ from the released obligations only
insofar as they are owed to or assumed by the New Lender
instead of the Existing Lender;
(iii) the rights of the Existing Lender against the existing
Parties under the Senior Finance Documents and vice versa
(the "released rights") will be cancelled and released;
and
(iv) the New Lender and the existing Parties will acquire
rights against each other under the Senior Finance
Documents which differ from the released rights only
insofar as they are exercisable by or against the New
Lender instead of the Existing Lender,
all on the date of execution of the Substitution Certificate by the
Facility Agent or, if later, the date specified in the Substitution
Certificate or, as the case may be, the Effective Date specified in
the Novation Agreement.
The transferred obligations shall not include any obligation under
Clauses 13 and 15 in respect of payments made prior to the
effective date of such Substitution Certificate or Novation
Agreement.
The Facility Agent shall notify the Obligors' Agent (on behalf of
the Obligors) of any such novation pursuant to this Clause 30.3.
30.4 Reference Banks
If a Reference Bank (or, if a Reference Bank is not a Lender, the
Lender of which it is an Affiliate) ceases to be one of the
Lenders, the Facility Agent shall (in consultation with the
Company) appoint another Lender or an Affiliate of a Lender to
replace that Reference Bank.
30.5 Register
The Facility Agent shall keep a record of all the Parties and shall
supply any other Party (at that Party's expense) with a copy of the
record on request.
30.6 Change of Facility Office
A Lender may change its Facility Office with respect to any
Utilisation from time to time on giving not less than five Business
Days' prior notice to the Facility Agent provided that if any
change in Facility Office would otherwise result in amounts being
payable to the relevant Lender pursuant to Clauses 13 or 15.1 then
such Lender shall be entitled to receive such amounts only to the
extent that such Lender acting through its original Facility Office
would have been entitled to claim and receive such amounts.
31. DISCLOSURE OF INFORMATION
(a) A Lender may disclose to one of its Affiliates or any person with
whom it is proposing to enter, or has entered into, any kind of
transfer, participation or other agreement in relation to this
Agreement:
(i) a copy of any Finance Document; and
(ii) any information which that Lender has acquired under or
in connection with any Finance Document,
provided that any such proposed transferee, participant or assignee
has agreed with the Company to keep any such Finance Document or
information confidential.
(b) The Company and the Facility Agent shall agree the form of all
press announcements issued in respect of the Finance Documents and
any transaction contemplated thereby.
32. SET-OFF
A Finance Party may set off any obligation due but unpaid by an
Obligor under the Senior Finance Documents (to the extent
beneficially owned by that Finance Party) against any obligation
(whether or not due and payable) owed by that Finance Party to that
Obligor, regardless of the place of payment, booking branch or
currency of either obligation. If the obligations are in different
currencies, the Finance Party may convert either obligation, at the
cost of such Obligor, at a market rate of exchange in its usual
course of business for the purpose of the set-off. If either
obligation is unliquidated or unascertained, the Finance Party may
set off in an amount estimated by it in good faith to be the amount
of that obligation.
33. PRO RATA SHARING
33.1 Redistribution
If any amount owing by an Obligor under this Agreement to a Finance
Party (the "recovering Finance Party") is discharged by payment,
set-off or any other manner other than through the Facility Agent
in accordance with Clause 12 (a "recovery"), then:
(a) the recovering Finance Party shall, within three Business
Days, notify details of the recovery to the Facility
Agent;
(b) the Facility Agent shall determine whether the recovery
is in excess of the amount which the recovering Finance
Party would have received had the recovery been received
by the Facility Agent and distributed in accordance with
Clause 12;
(c) subject to Clause 33.3 the recovering Finance Party
shall, within three Business Days of demand by the
Facility Agent, pay to the Facility Agent an amount (the
"redistribution") equal to the excess;
(d) the Facility Agent shall treat the redistribution as if
it were a payment by the Obligor concerned under Clause
12 and shall pay the redistribution to the Finance
Parties (other than the recovering Finance Party) in
accordance with Clause 12.6; and
(e) after payment of the full redistribution, the recovering
Finance Party will be subrogated to the portion of the
claims paid under paragraph (d) above, and that Obligor
will owe the recovering Finance Party a debt which is
equal to the redistribution, immediately payable and of
the type originally discharged.
33.2 Reversal of redistribution
If:
(a) a recovering Finance Party must subsequently return a
recovery, or an amount measured by reference to a
recovery, to an Obligor; and
(b) the recovering Finance Party has paid a redistribution in
relation to that recovery,
each Finance Party shall, within three Business Days of demand by
the recovering Finance Party through the Facility Agent, reimburse
the recovering Finance Party all or the appropriate portion of the
redistribution paid to that Finance Party. Thereupon the
subrogation in Clause 33.1(e) will operate in reverse to the extent
of the reimbursement.
33.3 Exception
A recovering Finance Party need not pay a redistribution to the
Facility Agent (i) to the extent that it would not, after the
payment, have a valid claim against the Obligor concerned in the
amount of the redistribution pursuant to Clause 33.1(e) or (ii)
where the recovering Finance Party made the recovery as a
consequence of a judgment in any legal proceedings, to the extent
that any other Finance Party was given notice of such proceedings
and, being entitled to do so, did not join in such proceedings.
34. SEVERABILITY
If a provision of any Senior Finance Document is or becomes
illegal, invalid or unenforceable in any jurisdiction, that shall
not affect:
(a) the legality, validity or enforceability in that
jurisdiction of any other provision of the Senior Finance
Documents; or
(b) the legality, validity or enforceability in other
jurisdictions of that or any other provision of the
Senior Finance Documents.
35. COUNTERPARTS
This Agreement may be executed in any number of counterparts, and
this has the same effect as if the signatures on the counterparts
were on a single copy of this Agreement.
36. NOTICES
36.1 Giving of notices
All notices or other communications under or in connection with
this Agreement shall be given in writing or by telex or facsimile.
Any such notice will be deemed to be given as follows:
(a) if in writing, when delivered;
(b) if by telex, when despatched, but only if, at the time of
transmission, the correct answerback appears at the start
and at the end of the sender's copy of the notice; and
(c) if by facsimile, when received.
However, a notice given in accordance with the above but received
on a non-working day or after business hours in the place of
receipt will only be deemed to be given on the next working day in
that place.
36.2 Addresses for notices
The address, telex number and facsimile number of each Party for
all notices under or in connection with this Agreement are:
(a) as specified in Schedule 1 or 2, as the case may be, or
in the Transfer Agreement or Guarantor Accession
Agreement by which such Party became a party to this
Agreement, as such Party's address for notices; or
(b) as otherwise notified by that Party for this purpose to
the Facility Agent (or in the case of the Facility Agent
as otherwise notified by the Facility Agent to the other
Parties) by not less than five Business Days' notice.
37. JURISDICTION
37.1 Submission
For the benefit of each Finance Party, each Obligor agrees that the
courts of England have jurisdiction to settle any disputes in
connection with any Finance Document (other than the Security
Documents) and accordingly submits to the jurisdiction of the
English courts.
37.2 Service of process
Without prejudice to any other mode of service, each Obligor which
is not incorporated in England or Wales:
(a) irrevocably appoints Sisec Limited whose registered
office is at ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
(Attention: ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ (ref:
A7/BJP/SC/AJAP/H0638.00697/London) (provided that if
Sisec Limited shall for any reason resign each such
Obligor irrevocably appoints the Company) as its agent
for service of process relating to any proceedings before
the English courts in connection with any Finance
Document;
(b) agrees that failure by such process agent to notify the
Obligor of the process will not invalidate the
proceedings concerned; and
(c) consents to the service of process relating to any such
proceedings by prepaid posting of a copy of the process
to its address for the time being applying under Clause
36.2 (Addresses for notices).
37.3 Forum convenience and enforcement abroad
Each Obligor:
(a) waives objection to the English courts on grounds of
inconvenient forum or otherwise as regards proceedings in
connection with a Finance Document; and
(b) agrees that a judgment or order of an English court in
connection with a Finance Document is conclusive and
binding on it and may be enforced against it in the
courts of any other jurisdiction.
37.4 Non-exclusivity
Nothing in this Clause 37 limits the right of a Finance Party to
bring proceedings against an Obligor in connection with any Finance
Document:
(a) in any other court of competent jurisdiction; or
(b) concurrently in more than one jurisdiction.
38. GOVERNING LAW
This Agreement is governed by English law.
THIS AGREEMENT has been entered into on the date stated at the beginning of
this Agreement.
SCHEDULE 1
VARIOUS PARTIES
PART I
ORIGINAL BORROWERS
DUNLOP STANDARD AEROSPACE (UK) LIMITED
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
▇▇▇▇▇ AVIATION LIMITED
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
DUNLOP STANDARD AEROSPACE OVERSEAS LIMITED
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
DUNLOP STANDARD AEROSPACE (US) INC.
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
STANDARD AEROSPACE (CANADA) LIMITED (PREVIOUSLY KNOWN AS 351439-1
CANADA INC.)
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
PART II
ORIGINAL GUARANTORS
DUNLOP STANDARD AEROSPACE GROUP LIMITED
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
DUNLOP STANDARD AEROSPACE HOLDINGS LIMITED
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
DUNLOP STANDARD AEROSPACE (UK) LIMITED
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
▇▇▇▇▇ AVIATION LIMITED
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
DUNLOP STANDARD AEROSPACE OVERSEAS LIMITED
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
DUNLOP STANDARD AEROSPACE (US) INC.
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
STANDARD AEROSPACE (CANADA) LIMITED (PREVIOUSLY KNOWN AS 351439-1 CANADA INC.)
Address for notices: Times Place
▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Fax: 0171 663 9350
PART III
AGENTS
Facility Agent and Security Agent
and Syndication Agent
The Fuji Bank, Limited
River ▇▇▇▇▇ ▇▇▇▇▇
▇-▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
Attention: ▇▇. ▇▇▇▇
Loans Administration Department
Fax: ▇▇▇▇ ▇▇▇ ▇▇▇▇
Telex: 886352 FUJIBK G.
SCHEDULE 2
LENDERS AND COMMITMENTS
Lenders and Notice Tranche A Tranche B Tranche C Tranche D Tranche E
Details Commitments Commitments Commitments Commitments Commitments
(pound) (pound) (pound) (pound) (pound)
The Fuji Bank, Limited 160,000,000 50,000,000 50,000,000 50,000,000 75,000,000
River ▇▇▇▇▇ ▇▇▇▇▇
▇-▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Attention:
▇▇. ▇▇▇▇
Loans Administration
Department
SCHEDULE 3
CONDITIONS PRECEDENT DOCUMENTS
PART I
Signing Date
1.
A certified copy of the constitutional documents, including the
memorandum and articles of association, and certificates of
registration of each Obligor (or, for each U.S. Obligor, the
certificate and articles of incorporation and by-laws), as
currently in force.
2.
(a) A certified copy of a resolution of the board of
directors (or equivalent governing body authority) of
each of the Newcos (other than Dutchco) approving the
terms of, and the transactions contemplated by the Senior
Finance Documents to which it is a party and resolving
that it execute each such Senior Finance Document;
(b) satisfactory evidence of the authority of each signatory
of each Newco (other than Dutchco) (where such authorised
signatories are not registered at the commercial registry
as authorised to bind that company by their signature);
(c) a specimen of the signature of each authorised signatory
of each Newco (other than Dutchco);
(d) a certificate of a director of each Newco (other than
Dutchco) (or, for Newcos incorporated in the United
States of America, by one of its officers) confirming
that utilisation of that part of the Facilities available
to it in full would not cause any borrowing limit binding
on it to be exceeded;
(e) a certified copy of a resolution, signed by all the
holders of the issued or allotted shares in each Newco
(other than the Company, Dutchco, Canadaco or Dunlop
Standard Aerospace (US) Inc.), approving the terms of,
and the transactions contemplated by, the Senior Finance
Documents to which such Newco is to be a party;
(f) certificates of good standing for each U.S. Obligor.
3. A certified copy (or originals) of the duly executed Acquisition
Agreements, Priority Agreement, Bridge Finance Documents,
Shareholders Agreement and any other Transaction Document.
4. A certified copy of the Base Financial Statements.
5. A certified copy of the Business Plan.
6. The Disclosure Letter.
7. Each of the Reports together with signed reliance letters addressed
to the Agents and the Lenders where required.
8. Written confirmation from Sisec Limited that it accepts the
appointment as process agent for each Obligor which is not
incorporated in England and any subsequent appointment made by any
Additional Borrower or Additional Guarantor and confirmation from
Sisec Limited that any conditions referred to in its letter of
appointment have been satisfied.
9. A certified copy of the Agreed Security Principles.
10. The Structure Memorandum including a list of the Borrowers of the
Tranche A Advances, Tranche B Advances and Tranche C Advances and
the amounts being borrowed by such Borrowers.
11. At least four originals of each of the Security Documents listed in
Part I of Schedule 7 duly executed by each Obligor party thereto,
together with the share certificates (other than those relating to
the shares in Target Companies), stock transfer and title documents
relating to assets charged by such Security Documents which are
contemplated to be delivered to the Security Agent (or as it may
direct) and copies of all notices required to be despatched
pursuant to such Security Documents.
12. Each of the Certificates of Title addressed to the Agents and the
Lenders.
13. The executed Fee Letters.
14. The agreed form intercompany loan agreement between Dunlop Standard
Aerospace Holdings Limited and Holdco.
15. A legal opinion of:
(a) ▇▇▇▇▇ & Overy, English legal advisers to the Agents,
addressed to the Finance Parties;
(b) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, New York legal advisers
to the Agents, addressed to the Finance Parties;
(c) ▇▇▇▇▇▇ & Elliot, Canadian legal advisers to the Agents,
addressed to the Finance Parties.
16. Letters in the agreed form from each of the directors of each of
Dunlop Holdings Limited, Dunlop Limited and Dunlop Aerospace
Limited (or from each of the persons who will be appointed a
director of any such company at Closing) and of the auditors of
each such company confirming that they would be able to make the
necessary declarations and provide the necessary reports to enable
such company to complete the sections 155-158 CA 1985 procedure
were it to be carried out on the Signing Date and that they are not
aware of any reason why they will not be able to make such
declarations or provide such reports at Closing.
17. List of existing Treasury Transactions (if any) and evidence that
such Treasury Transactions have been transferred to Holdco by way
of novation.
18. Letter from the Investors to the Facility Agent concerning, amongst
other matters, the Reports.
19. Agreed form of the Security Documents to be entered into by members
of the Target Group at Closing.
20. Agreed form shareholder resolutions and board resolutions to be
passed by the shareholders or board of directors of members of the
Target Group (other than, with the exception of BTR Canada Inc, any
incorporated in Canada or the United States of America) giving
security and/or guarantees at Closing.
21. Agreed form constitutional documents of those members of the Target
Group giving security and/or guarantees at Closing;
22. Agreed form legal opinions to be given at Closing by each of:
(a) ▇▇▇▇▇ & ▇▇▇▇▇;
(b) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇;
(c) ▇▇▇▇▇▇ & Elliot;
(d) Stibbe Simont ▇▇▇▇▇▇▇ Duhot; and
(e) Rodyk & Davidson.
23. Agreed form share pledge to be executed on or before Closing by
Dutchco over its shares in BTR Aerospace B.V. and BTR Vliegwiel
B.V.
24. Agreed form Borrower Accession Agreements to be entered into by
Dunlop Aerospace Limited and BTR Canada Inc. together with agreed
form board and shareholder resolutions in respect thereof.
25. Agreed form Guarantor Accession Agreements to be entered into by
Dutchco and those companies and corporations specified in Schedule
7 Part III.
26. Agreed form board and shareholder resolutions, statutory
declarations, reports and letters for each company going through
the S155-158 Companies Act 1985 whitewash procedure together with
agreed form confirmation from the solicitors for the Company that
they will register all relevant resolutions and declarations at the
Companies Registry in the United Kingdom.
27. Agreed form full mortgage debenture to be executed on or before
Closing by Dunlop Aerospace Limited together with agreed form
shareholder resolutions and board resolutions in respect thereof.
28. Agreed form general business charge to be executed on or before
Closing by BTR Canada Inc. together with agreed form board
resolutions in respect thereof.
29. Agreed form share pledge to be executed on or before Closing by BTR
Canada Inc. over its shares in Standard Aero Limited together with
agreed form board resolutions in respect thereof.
30. Agreed form share pledge to be executed on or before Closing by
Dunlop Standard Aerospace Overseas Limited of the shares of
Standard Aero (Asia) Pte Limited and Dunlop Aviation (SEAsia) Pte
Limited.
31. Agreed form share pledge to be executed on or before Closing by
Dunlop Standard Aerospace Overseas Limited of the shares of
Dutchco.
PART II
On or before Closing
1. (a) A certified copy of a resolution of the board of
directors of each of Dunlop Aerospace Limited and Dunlop
Investments approving the terms of, and the transactions
contemplated by, the Senior Finance Documents to be
executed by it at Closing and resolving that it execute
each such Senior Finance Document;
(b) satisfactory evidence of the authority of each signatory
of each of Dunlop Aerospace Limited and Dunlop
Investments;
(c) a specimen of the signature of each authorised signatory
of each of Dunlop Aerospace Limited and Dunlop
Investments;
(d) a certificate of a director of each of Dunlop Aerospace
Limited and Dunlop Investments confirming that
Utilisation of that part of the Facilities available to
it in full would not cause any borrowing limit binding on
it to be exceeded;
(e) a certified copy of a resolution, signed by all the
holders of the issued or allotted shares in Dunlop
Investments, approving the terms of, and the transactions
contemplated by, the Senior Finance Documents to which
such company or corporation is to be a party;
(f) certified copy of the constitutional documents of each of
Dunlop Aerospace Limited and Dunlop Investments.
2. At least two originals of each of:
(a) (i) a full mortgage debenture in the agreed form
executed by Dunlop Aerospace Limited;
(ii) a share pledge in the agreed form given by
Dunlop Standard Aerospace Overseas Limited over
its shares in Standard Aero (Asia) Pte Limited
and Dunlop Aviation (SE Asia) Pte Limited;
(iii) a share pledge in the agreed form to be given
by Dunlop Investments over its shares in BTR
Aerospace B.V. and BTR Vliegwiel B.V.;
(iv) a deed of accession to the mortgage debenture
executed by, inter alia, the Company in the
agreed form and executed by Dunlop Investments;
(v) a share pledge in the agreed form to be given
by Dunlop Investments over its shares in
Dutchco (if and when acquired),
together, in each case, with (I) an undertaking from
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ in the agreed form relating to the
title deeds to the Key Properties (other than Bagworth)
and (II) the other title documents (if any) relating to
the assets charged by the Security Documents which are
required to be handed over by the Vendors under the
Acquisition Agreements, and in either case are
contemplated to be delivered to the Security Agent (or as
it may direct) and copies of all notices required to be
despatched pursuant to the Security Documents;
(b) the Borrower Accession Agreements entered into by the
proposed Additional Borrowers identified in Schedule 7
Part IV and a Guarantor Accession Agreement entered into
by Dunlop Investments, or otherwise becoming party to
this Agreement at Closing and of each Accession Deed
required pursuant to the provisions of the Priority
Agreement duly executed by all the parties thereto other
than the Facility Agent.
3. A certificate, signed by a director of the Company, confirming that
there are no existing Encumbrances registered in respect of any
assets of any member of the Target Group other than any notified to
the Facility Agent prior to 26th September, 1998 and which are
permitted to remain under this Agreement after Closing.
4. Requests in relation to all Utilisations to be made at Closing,
together with payment instructions in respect of all funds in the
Closing Accounts.
5. Certified Copy of the Funds Flow Statement.
6. Evidence that all Borrowings not permitted pursuant to Clause 21.10
have been repaid prior to Closing or that the Group will refinance
such Borrowings at (or immediately after) Closing in full from
funds advanced under this Agreement.
7. Certificate from a director of the Company confirming that each of
the Sale and Purchase Agreements is unconditional and that none of
the Acquisition Agreements has been amended (other than in such
respects as have been notified to the Facility Agent prior to 26th
September, 1998) and that neither the Company nor any of its
Subsidiaries has waived or agreed to amend or waive any provision
of the Acquisition Agreements or elected to complete the
Acquisition in circumstances where it would be entitled to decline
to do so.
8. Evidence reasonably satisfactory to the Facility Agent that all the
regulatory clearances and approvals specified in the Sale and
Purchase Agreements necessary for the Acquisition have been
obtained.
9. A certificate from the Company delivered at Closing specifying the
estimated Acquisition Costs.
10. A certified copy of the Warrant Instrument (as defined in the
Bridge Facility Agreement).
11. The Facility Agent shall have received evidence satisfactory to it
that the share certificates of each of the U.S. Obligors will be
delivered in London at Closing.
12. (a) Share certificates, together with executed stock transfer
forms (or their equivalent) for all of the issued share
capital of Dunlop Investments (provided that, for the
avoidance of doubt, share certificates for additional
shares in such companies issued following the
capitalisation of such companies at Closing, shall not be
required to be delivered prior to Closing but the
Facility Agent shall require sight of such share
certificates, executed but undated, prior to Closing);
(b) executed stock transfer forms for all additional shares
in the capital of any Newco (other than Dutchco) to be
issued following the capitalisation of such companies at
Closing;
(c) the Facility Agent shall have had sight of the corporate
book of each of the Newcos (other than Dutchco) and be
satisfied that the company secretary of each such company
has given instructions that such books be written up
immediately after Closing to reflect the capitalisation
of such companies at Closing;
(d) share certificates for each of the companies within the
Target Group received from the Vendor by the Company at
Closing shall be available for inspection by the Facility
Agent at Closing and the Facility Agent shall be
satisfied that the share certificates for such of those
companies whose immediate holding company will not,
following Closing, have changed, will be handed to the
Facility Agent immediately after Closing; and
(f) the Facility Agent shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ an undertaking in agreed form relating to the
share certificates for those companies whose shares are
are to be acquired at Closing.
13. The Proforma Accounts.
14. At least two originals of a Guarantor Accession Agreement entered
into by Dunlop Investments as an Additional Guarantor, duly
executed by all the parties thereto other than the Facility Agent.
PART III
Immediately after Closing
1. (a) A certified copy of a resolution of the board of
directors of each Obligor listed in Schedule 7 Part III
approving the terms of, and the transactions contemplated
by the Senior Finance Documents to be executed by it at
Closing and resolving that it execute each such Senior
Finance Document;
(b) satisfactory evidence of the authority of each signatory
of each Obligor listed in Schedule 7 Part III (where such
authorised signatories are not registered at the
commercial registry as authorised to bind that company by
their signature);
(c) a specimen of the signature of each authorised signatory
of each Obligor listed in Schedule 7 Part III (other than
Dunlop Aerospace Limited);
(d) a certified copy of a resolution, signed by all the
holders of the issued or allotted shares in each Obligor
listed in Schedule 7 Part III (other than those
incorporated in Canada and the United States of America),
approving the terms of, and the transactions contemplated
by, the Senior Finance Documents to which such Obligor is
to be a party;
(e) a certified copy of the certificate of incorporation and
constitutional documents of each Obligor listed in
Schedule 7 Part III and a certificate of good standing
for each U.S. Obligor.
2. At least two originals of each of:
(a) the Security Documents listed in Schedule 7 Part II duly
executed by each Obligor listed in Schedule 7 Part II and
each other party thereto, together with share
certificates and executed blank stock transfer forms for
each of the companies within the Target Group whose
immediate holding company will not, following Closing,
change and title documents, in each case relating to
assets charged by the Security Documents which are
contemplated to be delivered to the Security Agent (or as
it may direct) and copies of all notices required to be
despatched pursuant to the Security Documents as
identified prior to Closing;
(b) the Guarantor Accession Agreements entered into by the
proposed Additional Guarantors identified in Schedule 7
Part III or otherwise becoming party to this Agreement at
Closing and of each Accession Deed required pursuant to
the provisions of the Priority Agreement duly executed by
all the parties thereto other than the Facility Agent.
3. Evidence that the s.155-158 Companies ▇▇▇ ▇▇▇▇ procedure has been
completed (substantially as contemplated in the agreed form
resolutions agreed on or prior to the Signing Date) for each of
Dunlop Holdings Limited, Dunlop Limited and Dunlop Aerospace
Limited including copies of the auditors report and net assets
letter in relation to each such company and copies of the directors
register of each such Company, together with an undertaking from
the Company to register such materials at the Companies Registry as
are required by the Companies ▇▇▇ ▇▇▇▇.
4. Legal Opinions in the agreed form given by:
(a) ▇▇▇▇▇ & Overy;
(b) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇;
(c) ▇▇▇▇▇▇ & Elliot;
(d) Stibbe Simont ▇▇▇▇▇▇▇ Duhot;
(e) Rodyk & Davidson;
(f) McMaster Gervais;
(g) ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇▇;
(h) Hunton & ▇▇▇▇▇▇▇▇; and
(i) ▇▇▇▇ ▇▇▇▇▇▇▇.
5. Cheque for land registry fees.
6. The share certificates existing immediately prior to Closing for
the entire issued share capital of each member of the Target Group
whose shares are being acquired pursuant to the Sale and Purchase
Agreements and which are to be charged to the Lenders pursuant to
the Security Documents.
PART IV
Each of the documents referred to in paragraphs 1, 2, 4 and 15 of Schedule 3
Part I relating to the Additional Borrower or Additional Guarantor.
SCHEDULE 4
MATERIAL GROUP SUBSIDIARIES
Dunlop Aerospace Limited
Dunlop Limited
Dunlop Holdings Limited
▇▇▇▇▇ Aviation Limited
Standard Aero Limited
BTR Canada Inc
351439-1 Canada Inc
Dunlop Standard Aerospace Overseas Limited
Dunlop Standard Aerospace (UK) Limited
Dunlop Standard Aerospace Holdings Limited
Dunlop Standard Aerospace Group Limited
Standard Aero VoF
Dunlop Standard Aerospace Overseas Investment Limited
SCHEDULE 5
FORM OF REQUEST
To: The Fuji Bank, Limited as Facility Agent
Attention: [ ]
From: [BORROWER]
Date:[ ]
Dunlop Standard Aerospace Group Limited
(pound)260,000,000 Term Loan Facilities
and (pound)75,000,000 Capital Expenditure Facility
and(pound)50,000,000 Revolving Credit Facility dated [ ], 1998
(the "Credit Agreement")
Terms used in this Request and defined in the Credit Agreement have the same
meaning in this Request as in the Credit Agreement.
1. On behalf of [ ] we request that the Lenders [make an
Advance/issue a [Documentary Credit - describe]] as follows:
(a) Borrower: [ ]
(b) Tranche: [ ]
(c) Utilisation Date: [ ]
(d) Currency: [ ]
(e) Amount: (pound)[ ]
(f) Term: [ ]
(g) Payment Instructions: [ ]/Beneficiary Details: [ ].
2. We confirm, on behalf of the Obligors, that each condition
specified in Clause 4.2 (Further conditions precedent) of the
Credit Agreement is satisfied on the date of this Request.
[3. We confirm that Clause 5.6 of the Credit Agreement applies in
relation to the Documentary Credit referred to in this Request.] *
Yours faithfully,
........................................
for and on behalf of
DUNLOP STANDARD AEROSPACE GROUP LIMITED
as Obligors' Agent
cc: [Borrower]
*____________________________________
Request for Documentary Credits only
SCHEDULE 6
FORMS OF ACCESSION DOCUMENTS
PART I
SUBSTITUTION CERTIFICATE
To: The Fuji Bank, Limited as Facility Agent under the Credit Agreement
From: [THE EXISTING BANK] and [THE NEW BANK] Date: [ ]
Dunlop Standard Aerospace Group Limited
(pound)260,000,000 Term Loan Facilities
and (pound)75,000,000 Capital Expenditure Facility
and (pound)50,000,000 Revolving Credit Facility
dated [ ], 1998
(the "Credit Agreement")
References to Clauses are to Clauses of the Credit Agreement. Terms defined in
the Credit Agreement have the same meaning when used in this certificate.
We refer to Clause 30.3.
1. We [ ] (the "Existing Lender") and [ ] (the "New Lender") agree to
the Existing Lender and the New Lender transferring and assigning
all the Existing Lender's rights and obligations referred to in the
Schedule in accordance with Clause 30.3.
2. From the date specified in paragraph 3 below, the New Lender
becomes (a) party to the Credit Agreement as a Lender, and (b)
party to the Priority Agreement as a Senior Creditor with the
rights and obligations referred to in the Schedule and the New
Lender undertakes to perform all such obligations.
3. The specified date for the purposes of Clause 30.3(c) is [date of
transfer and assignment].
4. The Facility Office and address for notices of the New Lender for
the purposes of Clause 36.2 are set out in the Schedule.
5. The New Lender undertakes to counter-indemnify the Existing Lender
for the New Lender's pro rata share of all amounts payable by the
Existing Lender (whether pursuant to Clause 5.7 or otherwise) in
respect of any outstanding Documentary Credit.
6. The Existing Lender and the New Lender acknowledge and agree that
Clauses 30.2(d), (e), (f) and (g) and apply to this Substitution
Certificate and the transfer and assignment contemplated hereby as
if set out in full herein, mutatis mutandis.
7. This Substitution Certificate is governed by English law.
THE SCHEDULE
Rights and obligations to be transferred and assigned
[Details of the rights and obligations of the Existing Lender to be
transferred and assigned.]
[New Lender]
[Facility Office Address for notices]
[Existing Lender] [New Lender]
By: By:
Date: Date:
THE FUJI BANK, LIMITED
as Facility Agent under the Credit Agreement
By:
Date:
PART II
BORROWER ACCESSION AGREEMENT
To: THE FUJI BANK, LIMITED as Facility Agent
From: [PROPOSED BORROWER] and DUNLOP STANDARD AEROSPACE GROUP LIMITED
[Date]
Dunlop Standard Aerospace Group Limited
(pound)260,000,000 Term Loan Facilities
and (pound)75,000,000 Capital Expenditure Facility
and (pound)50,000,000 Revolving Credit Facility
dated [ ], 1998
(the "Credit Agreement")
Terms used herein which are defined in the Credit Agreement shall have the
same meaning herein as in the Credit Agreement.
We refer to Clause 19.1.
We, [Name of company] of [Registered Office] (Registered no. [ ]):
(a) agree to become party to and to be bound by the terms of the Credit
Agreement as an Additional Borrower in accordance with Clause 19.1;
and
(b) agree to become party to and to be bound by the terms of the
Priority Agreement as an Obligor in accordance with Clause [ ] of
the Priority Agreement.
[Any agreed limitations]
The address for notices of the Additional Borrower for the purposes of Clause
36.2 is:
[
]
This Agreement is governed by English law.
[ADDITIONAL BORROWER]
By:
DUNLOP STANDARD AEROSPACE GROUP LIMITED
By:
THE FUJI BANK, LIMITED
By:
PART III
GUARANTOR ACCESSION AGREEMENT
To: The Fuji Bank, Limited as Facility Agent
From: [PROPOSED GUARANTOR] and DUNLOP STANDARD AEROSPACE GROUP LIMITED
Date: [ ]
Dunlop Standard Aerospace Group Limited
(pound)260,000,000 Term Loan Facilities
and (pound)75,000,000 Capital Expenditure Facility and
(pound)50,000,000 Revolving Credit Facility
dated [ ], 1998
(the "Credit Agreement")
Terms used herein which are defined in the Credit Agreement shall have the
same meaning herein as in the Credit Agreement.
We refer to Clause 19.2.
We, [name of company] of [Registered Office] (Registered no. [ ]):
(a) agree to become party to and to be bound by the terms of the Credit
Agreement as an Additional Guarantor in accordance with Clause
19.2; and
(b) agree to become party to and to be bound by the terms of the
Priority Agreement as an Obligor in accordance with Clause [ ] of
the Priority Agreement.
[Agreed limitations]
Our address for notices for the purposes of Clause 36.2 is:
[ ]
This Deed is governed by English law.
[EXECUTION AS A DEED
BY PROPOSED GUARANTOR]
DUNLOP STANDARD AEROSPACE GROUP LIMITED
By:
THE FUJI BANK, LIMITED
By:
PART IV
ALTERNATIVE FORM OF NOVATION AGREEMENT
NOVATION AGREEMENT
DATED [ ], 1998
relating to a Credit Agreement dated [ ], 1998
(as supplemented and amended from time to time)
Between
DUNLOP STANDARD AEROSPACE GROUP LIMITED
and others as Borrowers and/or Guarantors
THE FUJI BANK, LIMITED
as Arranger and Original Lender
THE FUJI BANK, LIMITED
as Facility Agent, Security Agent and Syndication Agent
▇▇▇▇▇ & ▇▇▇▇▇
THIS AGREEMENT is dated [ ], 1998 between:
(1) DUNLOP STANDARD AEROSPACE GROUP LIMITED a company incorporated in
England and Wales (Registered No. 3573726) whose registered office
is at ▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ for itself and as Obligors'
Agent and for and on behalf of the Obligors as defined in the
Credit Agreement (the "Company");
(2) THE FUJI BANK, LIMITED as arranger (in this capacity the
"Arranger");
(3) THE FUJI BANK, LIMITED as facility agent for the Lenders (in this
capacity the "Facility Agent");
(4) [THE FUJI BANK, LIMITED] as the lender(s) party to the Credit
Agreement (as defined below) as at today's date (the "Existing
Lender");
(5) THE FINANCIAL INSTITUTIONS listed in Schedule 1 as the lenders who
wish to accede to the Credit Agreement as Lenders (the "New
Lenders");
(6) THE FUJI BANK, LIMITED as LC bank for the Lenders (in this capacity
the "LC Bank").
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Agreement, unless the contrary intention appears or the
context otherwise requires:
"Credit Agreement"
means the credit agreement dated [ ], 1998 between the Company,
certain of its subsidiaries as Borrowers and/or Guarantors, The
Fuji Bank, Limited as the Arranger, the Original Lender, the LC
Bank, the Facility Agent, the Syndication Agent and the Security
Agent (as supplemented and amended from time to time).
"Effective Date"
means [ ], 199[8].
1.2 Incorporation of Credit Agreement definitions
Terms defined in the Credit Agreement shall, unless the contrary
intention appears or the context otherwise requires, have the same
meaning in this Agreement.
1.3 Incorporation
Clauses 1.2 (Construction), 37 (Jurisdiction), 29.3 (Waivers and
remedies cumulative) and 34 (Severability) of the Credit Agreement
shall apply to this Agreement, mutatis mutandis.
2. CONSENT, CONFIRMATION AND DESIGNATION
2.1 Consent and confirmation
The Company (for itself and on behalf of each of the Obligors), the
Arranger, the Existing Lender and the Facility Agent each consent
to the New Lenders becoming Lenders and confirm that, except as
expressly provided by the terms of this Agreement, each of the
Senior Finance Documents shall continue in full force and effect.
2.2 Designation
The Facility Agent, the Lenders and the Company hereby designate
this Agreement a Senior Finance Document.
3. NOVATION
3.1 Novation of Commitments and related rights and obligations
On the Effective Date (regardless of whether a Default is then
outstanding):
(a) each New Lender will become:
(i) a Lender under the Credit Agreement with the
Commitments as set out opposite its name in
Schedule 2 Part I and with the participations
in any Utilisations then outstanding as set out
opposite its name in Schedule 2 Part II; and
(ii) a Senior Creditor under the Priority Agreement;
(b) each Existing Lender's Commitments shall be and be deemed
to be reduced down to the levels set out opposite its
name in Schedule 2 Part I;
(c) the Existing Lender's participations in any Utilisations
then outstanding shall be and shall be deemed to be
reduced down to the levels set out opposite its name in
Schedule 2 Part II;
(d) each New Lender will automatically obtain and assume, and
undertakes to perform, all of the rights and obligations
of a Lender under and in respect of each of the Senior
Finance Documents in respect of the rights and
obligations transferred to it and/or assumed by it under
paragraphs (a), (b) and (c) above;
(e) the obligations and liabilities of the Existing Lender
and each of the New Lenders pursuant to Clause 5.7
(Lenders' Counter-guarantee) with respect to any
Documentary Credit outstanding on the Effective Date
shall be adjusted to that which it would have been had
such Existing Lender and such New Lender had the
Commitments set opposite their names in Schedule 2 Part I
on the date such Documentary Credit was issued; and
(f) each Obligor shall automatically acquire rights against
and assume obligations towards each of the New Lenders on
the basis of the rights and obligations transferred to
and/or assumed by the New Lenders under paragraphs (a),
(b), (c) and (e) above.
3.2 Amounts due on or before the Effective Date
(a) All amounts (if any) payable to an Existing Lender by any Obligor
on or before the Effective Date (including, without limitation, all
interest and fees payable on the Effective Date) in respect of any
period ending on or prior to the Effective Date shall be for the
account of such Existing Lender, and none of the New Lenders shall
have any interest in, or any rights in respect of, any such amount.
(b) If any Utilisation falls to be made on the Effective Date:
(i) the Facility Agent will promptly notify each of the New
Lenders of that fact (and the amount of its participation
in that Utilisation in accordance with paragraph (ii)
below); and
(ii) the Existing Lender and each New Lender shall participate
in that Utilisation (subject to the terms of the Credit
Agreement) as if the novation of Commitments under
Clauses 3.1(a), (b) and (c) (Novation of Commitments and
related rights and obligations), of this Agreement had
taken effect prior to opening of business three Business
Days before the Effective Date,
and the Company as Obligors' Agent acknowledges that an Existing
Lender will not be obliged to participate in any such Utilisation
to any greater extent than its pro rata share of such Utilisation
determined on the basis of the Commitments in Schedule 2 Part I.
3.3 Administrative details
Each New Lender has delivered to the Facility Agent its initial
details for the purposes of Clause 36 (Notices) of the Credit
Agreement and Clause 28 (Notices) of the Priority Agreement.
4. CONFIRMATION BY NEW LENDERS
Each New Lender confirms that:
(a) it has power and authority to become a party to the
Senior Finance Documents and has taken all necessary
action to authorise execution of this Agreement and has
obtained all necessary approvals and consents to the
assumption of its obligations under the Credit Agreement
and the Priority Agreement;
(b) it is a Recognised Lender [and (only if it is a bank
having its principal place of business in the U.S.A.) it
is a bank as defined in section 3(a)(6) of the Securities
▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ of the USA]; and
(c) it does not have an entitlement, were the Effective Date
to be the date of this Agreement, to receive amounts
payable under Clauses 13, 15.1 or 15.3 of the Credit
Agreement in amounts greater than would have been payable
by the Obligors under the Credit Agreement at that time
in the absence of the novation under this Agreement.
5. NATURE OF THIS AGREEMENT
For the avoidance of doubt, the parties to this Agreement agree
that the transfer of rights and obligations contemplated by this
Agreement shall take effect (in accordance with its terms) as a
novation so that:
(a) Schedule 2 is substituted for Schedule 2 to the Facility
Agreement on the Effective Date; and
(b) Clauses 30.2 (Transfers by Lenders) and 30.3 (Procedure
for Novation) of the Credit Agreement are deemed to be
set out in full in this Agreement.
6. COUNTERPARTS
This Agreement may be executed in any number of counterparts and
all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
7. GOVERNING LAW AND JURISDICTION
This Agreement is governed by and shall be construed in accordance
with English law.
This Agreement has been entered into on the date stated at the beginning of
this Agreement.
SCHEDULE 1
NEW LENDERS
SCHEDULE 2
PART I
LENDERS AND COMMITMENTS
Lender Tranche A Tranche B Tranche C Tranche D Tranche E
Commitments Commitments Commitments Commitments Commitments
(pound) (pound) (pound) (pound) (pound)
PART II
LENDERS AND UTILISATIONS
Lender Tranche A Tranche B Tranche C Tranche D Tranche E
Advance Advance Advance Advances Advance
(pound) C$ $ (pound) (pound)
[Details of Documentary Credits]
SIGNATORIES TO THE NOVATION AGREEMENT
The Company (for and on behalf of the Obligors)
DUNLOP STANDARD AEROSPACE GROUP LIMITED
By:
Arranger
THE FUJI BANK, LIMITED
By:
Facility Agent
THE FUJI BANK, LIMITED
By:
Existing Lender
THE FUJI BANK, LIMITED
By:
New Lenders
[ ]
By:
LC Bank
THE FUJI BANK, LIMITED
By:
SCHEDULE 7
PART I
SECURITY DOCUMENTS
(To be given on or prior to Signing)
United Kingdom (English law unless otherwise stated)
1. Debenture from Dunlop Standard Aerospace Group Limited, Dunlop
Standard Aerospace Holdings Limited, Dunlop Standard Aerospace (UK)
Limited, ▇▇▇▇▇ Aviation Limited and Dunlop Standard Aerospace
Overseas Limited.
2. Pledge of shares from Dunlop Standard Aerospace Overseas Limited of
shares of Dunlop Standard Aerospace (US) Inc.
3. Assignment of the benefit of the Acquisition Agreements from Dunlop
Standard Aerospace (US) Inc..
United States of America (New York law unless otherwise stated)
1. General business charge from Dunlop Standard Aerospace (US) Inc.
2. Pledge of shares from Dunlop Standard Aerospace (US) Inc. of the
shares of Dunlop Aviation North America Inc, Standard Aero Inc, and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ South Wind Corporation (English Law).
Canada (Canadian law)
1. Pledge of shares from Dunlop Standard Aerospace Overseas Limited of
the shares of Canadaco.
2. Pledge of shares from Canadaco of the shares of BTR Canada Inc.
3. General Security Agreement from Canadaco.
PART II
SECURITY DOCUMENTS
(To be given at Closing)
United Kingdom (English law unless otherwise stated)
1.* Debenture from Dunlop Aerospace Limited (to secure its own
liabilities under the Finance Documents)
2. Debenture from Dunlop Holdings Limited, Dunlop Aerospace Limited
and Dunlop Limited.
United States of America (New York law unless otherwise stated)
1. Pledge of Shares from Standard Aero Inc of its shares in Standard
Aero (Alliance) Inc (English law).
2. General business charge from Dunlop Aviation North America Inc,
Standard Aero Inc, Standard Aero (Alliance) Inc and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
South Wind Corporation.
3. Trademark Security Agreement from ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ South Wind
Corporation.
4. Mortgage of Property from Standard Aero (Alliance) Inc over
property located at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇.
5. Mortgage of Property from ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ South Wind Corporation
over property located in Troy, Indiana.
Canada (Canadian law)
1. Pledge of Shares from BTR Canada Inc of the shares of Standard Aero
Limited.
2. General Security Agreement from BTR Canada Inc.
3. General Security Agreement from Standard Aero Limited and Dunlop
Aviation Canada Inc.
4. Pledge of Shares from Dunlop Aviation North America Inc of the
shares of Dunlop Aviation Canada Inc.
5. Mortgage over property located in Winnipeg.
6. Hypothec over movable property in Quebec from Standard Aero
Limited.
Singapore (Singapore law)
1.* Pledge of Shares from Dunlop Standard Aerospace Overseas Limited of
the shares of Standard Aero (Asia) Pte Limited and Dunlop Aviation
(SE Asia) Pte Limited.
The Netherlands (Dutch Law)
1. Pledge of shares from Dunlop Investments of the shares of BTR
Aerospace B.V. and BTR Vliegwiel B.V.
* Items marked with an asterisk are to be given prior to Closing
occurring.
PART III
ADDITIONAL GUARANTORS
(To become Guarantors as soon as practicable after Closing)
BTR Canada Inc
Standard Aero Limited
Dunlop Aviation Canada Inc
Dunlop Aviation North America Inc
Standard Aero Inc
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ South Wind Corporation
Standard Aero (Alliance) Inc
Dunlop Holdings Limited
Dunlop Limited
Dunlop Aerospace Limited
PART IV
ADDITIONAL BORROWERS
Dunlop Aerospace Limited
SCHEDULE 8
FORM OF DOCUMENTARY CREDIT
PART I
[LC Bank Letterhead]
To: [
]
For the attention of: [ ]
Dear Sirs,
Non-Transferable Letter of Credit No [ ]
We hereby issue our Irrevocable Non-Transferable Letter of Credit No. [ ],
details of which are as follows:
Account Party: [Borrower under Facility Agreement.]
Availability: By payment against delivery of Required
Documents.
Beneficiary: [Details.]
Charges: All banking charges and commissions other than
our own are for Beneficiary's account.
Maximum Amount: [ ]
Payment Currency: [Sterling or an Optional Currency.]
Expiry Date: [ ]
Partial Payment: Partial payments are permitted, provided that
the Payment Amounts shall not in the aggregate
exceed the Maximum Amount.
Payment Amount: An amount in the Payment Currency certified in
a Certificate of Beneficiary to be a Payment
Amount.
Required Documents: A Certificate of Beneficiary in the
form set out in Appendix A hereto, duly
completed in a manner consistent with the
requirements of this Letter of Credit and
signed on behalf of the Beneficiary.
We engage with the Beneficiary that within five working days in London after
receipt by us at our offices at [ ] of the related Required Documents
conforming to the terms of this Letter of Credit we will pay to or to the
order of the Beneficiary, in the Payment Currency in funds providing same day
value, by credit to the account specified in the related Certificate of
Beneficiary, the lesser of:
(i) each Payment Amount, as stated in Required Documents; and
(ii) the balance of the Maximum Amount after deducting the amount of any
and all previous payments by us under this Letter of Credit.
This Letter of Credit and the Beneficiary's rights and benefits hereunder
shall be Non-Transferable and shall be payable only against presentation of
Required Documents. This Letter of Credit shall expire on, and no payment
shall be made pursuant hereto after, the Expiry Date.
Save in so far as such provisions may be inconsistent with the express terms
of this Letter of Credit, this Letter of Credit is subject to the provisions
of the Uniform Customs and Practice for Documentary Credits (1993 Revision)
ICC Publication No. 500.
This Letter of Credit and the Credit established hereby shall be governed by
English law. For the avoidance of doubt, it is confirmed that demand may be
made hereunder by tested telex.
Yours faithfully,
..........................
for and on behalf of
[ ]
E X H I B I T A
CERTIFICATE OF BENEFICIARY
To: [L/C Bank]
Dear Sirs,
Non-Transferable Letter of Credit No. [ ] (the "Credit")
With reference to the above Credit, we hereby certify that:
(a) we have provided general banking facilities to [ ] [and its
subsidiaries] incorporated in [ ];
(b) an aggregate amount (the "Payment Amount") of [ ] (comprising
[ ] of principal and [ ] of interest and/or other charges)
fell due for payment in [ ] by [ ] on [ ]and remains
due and unpaid at the date of this Certificate.
Accordingly, we hereby request payment pursuant to the Credit of the Payment
Amount. Payment is to be made to our account (A/c No. [ ]) with [ ]
at [ ].
Yours faithfully,
......................................
for and on behalf of
[ ]
PART II
(Syndicated)
To: [ ]
For the attention of:
[date]
Dear Sirs,
Irrevocable Non-Transferable Letter of Credit No. [ ]
The Lenders (as defined below) in their several Participation Percentages (as
defined below) hereby issue this Irrevocable Non-Transferable Letter of Credit
No. [ ] (the "Credit"), details of which are as follows:
Account Party: [Borrower under Facility Agreement.]
Facility Agent: The Fuji Bank, Limited as Facility Agent for
the Lenders or any other person notified from
time to time by the Facility Agent to the
Beneficiary as being the Facility Agent for
the purposes of the Credit.
Facility Agent's Office: [ ], or such other office
from time to time notified by the Facility
Agent to the Beneficiary.
Availability: By payment against delivery of Required
Documents.
Lender: Name Participation Percentage
[ ] [ %]
[ ] [ %]
[ ] [ %]
Beneficiary: [details]
Charges: Any banking or other charges and commissions
(other than our own) are for the Beneficiary's
account.
Maximum Amount: [ ]
Payment Currency: [Sterling or an Optional Currency.]
Expiry Date: [ ]
Partial Payment: Partial payments are permitted, provided that
the Payment Amounts shall not in the aggregate
exceed the Maximum Amount.
Participation Percentage: In relation to a Lender, the percentage set
out opposite its name above, as varied by any
novation referred to below.
Payment Amount: An amount in the Payment Currency certified in
a Certificate of Beneficiary to be a Payment
Amount.
Required Documents: A Certificate of Beneficiary in the form set
out in Appendix A hereto, (duly completed in a
manner consistent with the requirements of
this credit and signed on behalf of the
Beneficiary).
Each Lender engages with the Beneficiary that within five working days in
London after receipt by the Facility Agent at the Facility Agent's Office of
the related Required Documents conforming to the terms of this Credit, such
Lender will pay to or to the order of the Beneficiary, in the Payment Currency
in funds providing same day value, by credit to the account specified in the
related Certificate of Beneficiary, its Participation Percentage of the lesser
of:
(i) each Payment Amount, as stated in the Required Documents; and
(ii) the balance of the Maximum Amount after deducting the amount of any
and all previous payments by the Banks under this Credit.
This Credit shall be non-transferable and shall be payable only against
presentation of the Required Documents. This Credit shall expire on, and no
payment shall be made pursuant hereto after, the Expiry Date.
The obligations of the Lenders under this Credit are several according to
their respective Participation Percentages and not joint and several and
neither the Facility Agent nor any Lender shall be liable for the failure of
any Lender to perform its obligations hereunder. The aggregate amount payable
by each Lender hereunder shall not exceed its Participation Percentage of the
Maximum Amount.
The Facility Agent shall have no liability hereunder except in its capacity as
a Lender.
A Lender (the "Existing Lender") may with the prior written consent of the
Beneficiary, such consent not to be unreasonably withheld or delayed, novate
all or part of its rights and/or obligations under this Credit to another bank
or financial institution (the "New Lender"). Such consent of the Beneficiary
shall not be withheld where an Existing Bank wishes to novate all or part of
its obligations to a New Lender which is at the time of such novation rated
BBB or above by Standard & Poor's Corporation or Baa2 by ▇▇▇▇▇'▇ Investor
Services Inc. A novation of rights and/or obligations will only be effected if
the Existing Lender and the New Lender deliver to the Facility Agent a duly
completed certificate, substantially in the form of Annex B hereto (a "LC
Transfer Certificate") duly executed by each of them and the Beneficiary
(which shall be obliged to execute the same where not entitled to withhold
consent to the transaction) and then countersigned by the Facility Agent on
behalf of the other Lenders.
Upon the novation becoming effective in the manner referred to in the previous
paragraph, the Existing Lender shall be relieved of its obligations under this
Credit to the extent that they are novated to the New Lender and any reference
in this Credit to a Lender shall include the New Lender. Each Lender (other
than the Existing Lender and the New Lender) irrevocably authorises the
Facility Agent to execute a duly completed LC Transfer Certificate on its
behalf.
Failure by the Beneficiary (within ten Business Days of receiving a written
request therefor) to give consent to any novation pursuant to, and to execute
an LC Transfer Certificate, which by the terms of this Credit it is not
entitled to withhold or fail to execute will result in all obligations of the
Existing Lender which were to have been novated being cancelled at the expiry
of such ten Business Day period, such cancellation to result in non-payment by
that Existing Lender of its Participation Percentage of any further Payment
Amount without affecting the payments to be made by the other Lenders in
respect thereof.
On the date of execution of the Transfer Certificate by the Facility Agent and
(if the Beneficiary's consent is required but not deemed given) the
Beneficiary or, if later, the date specified in the LC Transfer Certificate:
(i) the Facility Agent, the other Lenders and the Beneficiary (the
"Existing Parties") and the Existing Lender will be released from
their obligations to each other under this Credit (the "Discharged
Obligations");
(ii) the New Lender and the Existing Parties will assume obligations
towards each other which differ from the Discharged Obligations
only insofar as they are owed to or assumed by the New Lender
instead of the Existing Lender;
(iii) the rights of the Existing Lender against the Existing Parties and
vice versa (the "Discharged Rights") will be cancelled; and
(iv) the New Lender and the Existing Parties will acquire rights against
each other which differ from the Discharged Rights only insofar as
they are exercisable by or against the New Lender instead of the
Existing Lender,
in each case to the extent only that the same relate to or arise out of the
amount of the Existing Lender's Participation Percentage specified in the LC
Transfer Certificate.
Save insofar as such provisions may be inconsistent with the express terms of
this Credit, this Credit is subject to the provisions of the Uniform Customs
and Practice for Documentary Credits (1993 Revision) ICC Publication No. 500.
This Letter of Credit shall expire on, and no payment shall be made pursuant
hereto after, the Expiry Date.
This Letter of Credit and the Credit established hereby shall be governed by
English law. For the avoidance of doubt, it is confirmed that demand may be
made hereunder by tested telex.
Yours faithfully,
.........................................
[Facility Agent to sign
on behalf of each Lender]
ANNEX A
Certificate of Beneficiary
To: [The Fuji Bank, Limited]
[date]
Dear Sirs,
Irrevocable Non-Transferable Letter of Credit No. [ ] (the "Credit")
With reference to the above Credit, we hereby certify that:
(a)
we have provided general banking facilities to [ ] [and its
subsidiaries] incorporated in [ ];
(b) an aggregate amount (the "Payment Amount") of [ ] (comprising
[ ] of principal and [ ] of interest and/or other charges)
fell due for payment in [Payment Currency] by [ ] on [ ]
and remains due and unpaid at the date of this Certificate.
Accordingly, we hereby request payment pursuant to the Credit of the Payment
Amount. Payment is to be made to our account (A/c No. [ ] with [ ]
at [ ].
Yours faithfully,
for and on behalf of
[Beneficiary]
ANNEX B
LC Transfer Certificate
To: The Fuji Bank, Limited
From: [THE EXISTING LENDER], [THE NEW LENDER] and [THE BENEFICIARY]
[date]
Dear Sirs,
Irrevocable Non-Transferable Letter of Credit No. [ ] (the "Credit")
With reference to the above Credit:
1. We [ ] (the "Existing Lender"), [ ] (the "New Lender") and [ ] (the
"Beneficiary") agree to the Existing Lender and the New Lender
novating all the Existing Lender's rights and obligations referred
to in the Schedule in accordance with the provisions of the Credit.
2. The New Lender hereby undertakes with the Existing Lender and each
of the other parties to the Credit that it will perform in
accordance with its terms all those obligations which by the terms
of the Credit will be assumed by it under the Credit after delivery
of the executed copies of this LC Transfer Certificate to the
Facility Agent (as defined in the Credit) and countersignature
thereof by the Facility Agent on behalf of the other Lenders (as
defined in the Credit) (and, as the case may be, the Beneficiary),
and the New Lender hereby undertakes to be bound by the provisions
of the Credit.
3. The Existing Lender hereby gives notice that nothing herein or in
the Credit (or any other document relating thereto) shall oblige
the Existing Lender (i) to accept a re-transfer from or novation by
the New Lender of the whole or any part of its rights, benefits
and/or obligations under the Credit or (ii) to support any losses
directly or indirectly sustained or incurred by the New Lender for
any reason whatsoever arising out of or in connection with the
Credit or its obligations thereunder. The New Lender hereby
acknowledges the absence of any such obligation as is referred to
in (i) and (ii) above.
4. The address for notices to the New Lender is set out in the
Schedule.
5. This LC Transfer Certificate is governed by English law.
THE SCHEDULE
Rights and obligations to be substituted
[Details of the rights and obligations of the Existing Lender to be novated.]
[Existing Lender] [New Lender] [Facility Agent]
By: By: By:
Date: Date: Date:
[Beneficiary]
By:
Date:
SCHEDULE 9
TERMS OF LENDERS' INDEMNITY TO LC BANK
1. Each Lender ("Tranche D Bank") having a Tranche D Commitment or
which had a Tranche D Commitment which it has assigned, transferred
or novated without the written consent of the LC Bank in each case
on the date of issue of a Documentary Credit, will pay any amount
demanded of it by the LC Bank pursuant to Clause 5.7 on the later
of the date that the LC Bank has itself to make payment under such
Documentary Credit (as notified by the LC Bank to such Tranche D
Bank in the demand) and two Business Days after receipt by such
Tranche D Bank of such demand.
2. Where a Tranche D Bank makes a payment pursuant to paragraph 1
after the date on which the LC Bank makes the relevant payment
under the Documentary Credit in question, such Tranche D Bank shall
pay on demand to the LC Bank its pro rata share (as calculated in
Clause 5.7) of such amount as the LC Bank certifies (such
certification to be conclusive in the absence of manifest error) as
necessary to compensate it for funding the amount demanded in the
interim.
3. No assurance, security or payment avoided under any law relating to
bankruptcy, liquidation, insolvency, reconstruction or
reorganisation or any similar laws and no release settlement,
arrangement or discharge which may have been given or made on the
basis of any such assurance, security or payment shall prejudice or
affect the right of the LC Bank to recover from each of the Tranche
D Bank to the full extent of their obligations under Clause 5.7 and
this Schedule 9.
4. The obligations of each Tranche D Bank under Clause 5.7 and this
Schedule 9 shall not be impaired, affected or revoked by any act,
omission, transaction, limitation, matter, thing or circumstance
whatsoever which but for this provision might operate to release or
exonerate such Tranche D Bank from all or any part of its
obligations under Clause 5.7 and this Schedule 9 or reduce, impair
or affect such obligations or cause all or any part of such
obligations to be irrecoverable from or unenforceable against any
Obligor or to discharge, reduce, affect or impair any of such
obligations, including without limitation:
(a) any time, waiver or indulgence granted to any Obligor or
any other person or the forbearance of the LC Bank in
enforcing the obligations of any Obligor or any other
person under this Agreement or any of the other Senior
Finance Documents or in respect of any other guarantee,
security, obligation, right or remedy;
(b) the recovery of any judgment against any Obligor or any
other person or any action to enforce the same;
(c) the taking of any other security from any Obligor or any
other person or the failure, refusal or neglect to take,
perfect or enforce, any rights, remedies or securities
from or against any Obligor or any other person or all or
any part of the security constituted by any of the Senior
Finance Documents;
(d) any alteration in the constitution of any Obligor or any
defect in or irregular exercise of the borrowing or other
powers of any Obligor or any other person or any legal
limitation, disability, incapacity or other circumstance
relating to any Obligor or any other person whether
arising in relation to this Agreement, any of the other
Finance Documents or any other guarantee or security or
otherwise howsoever;
(e) any amendment or supplement to or variation of any
Finance Document;
(f) the insolvency, bankruptcy, liquidation, reconstruction
or reorganisation of, or analogous proceedings relating
to any Obligor or any other person or any composition or
arrangement made by any of them with the LC Bank, any
Lender or any other person or any transfer or extinction
of any liabilities of or any Obligor by any law, order,
regulation, decree, court order or similar instrument; or
(g) any irregularity, unenforceability or invalidity of any
obligations of any Obligor or any other person under any
security or document (to the intent that such Tranche D
Bank's obligations under Clause 5.7 and this Schedule 9
shall remain in full force as if there were no such
irregularity, unenforceability or invalidity).
5. The LC Bank shall be entitled to enforce the obligations of each
Lender under Clause 5.7 and this Schedule 9 without making any
demand on or taking any proceedings against or filing any proof or
claim in any insolvency, winding up or liquidation of any Obligor
or any other person or exhausting any right or remedy against any
Obligor or any other person or taking any action to enforce any
part of the security constituted or evidenced by any of the Finance
Documents.
6. The obligations of each Tranche D Bank under Clause 5.7 and this
Schedule 9 shall be continuing obligations and shall extend to the
ultimate balance of the obligations referred to in paragraph (a)
thereof. If, for any reason, such obligations cease to be
continuing obligations, the LC Bank may open a new account with or
continue any existing account with any Obligor or other person and
the liability of each Tranche D Bank in respect of amounts
guaranteed by it pursuant to Clause 5.7 and this Schedule 9 at the
date of such cessation shall remain regardless of any payments in
or out of any such account.
7. The LC Bank's rights under Clause 5.7 and this Schedule 9 shall be
in addition to and shall be in no way prejudiced by any other
rights of or security held by the LC Bank in relation to the
obligations of any Obligor. The LC Bank's rights under Clause 5.7
and this Schedule 9 are in addition to and are not exclusive of
those provided by law.
8. A certificate of the LC Bank as to any amount due to it from any
Lender pursuant to Clause 5.7 and this Schedule 9 shall be
conclusive in the absence of manifest error.
SCHEDULE 10
CALCULATION OF THE MANDATORY COST
(a) The Mandatory Cost for an Advance for each of its Interest Periods
is the rate determined by the Facility Agent to be equal to the
arithmetic mean (rounded upward, if necessary, to four decimal
places) of the respective rates notified by each of the Reference
Banks to the Facility Agent and calculated in accordance with the
following formulae:
in relation to an Advance denominated in Sterling:
BY + S(Y-Z) + F x 0.01 % per annum = Mandatory Cost
----------------------
100-(B + S)
in relation to any other Advance:
F x 0.01 % per annum = Mandatory Cost
-------
300
where on the day of application of the formula:
B is the percentage of the Reference Bank's eligible
liabilities (in excess of any stated minimum) which the
Bank of England requires the Reference Bank to hold on a
non-interest-bearing deposit account in accordance with
its cash ratio requirements;
Y is the rate at which Sterling deposits are offered by the
Reference Bank to leading banks in the London interbank
market at or about 11.00 a.m. on that day for the
relevant period;
S is the percentage of the Reference Bank's eligible
liabilities which the Bank of England requires the
Reference Bank to place as a special deposit;
Z is the interest rate per annum allowed by the Bank of
England on special deposits; and
F is the charge payable by the Reference Bank to the
Financial Services Authority under paragraph 2.02 or 2.03
(as appropriate) of the Fees Regulations but where for
this purpose, the figure in paragraph 2.02b and 2.03b
will be deemed to be zero expressed in pounds per
(pound)1 million of the fee base of the Reference Bank.
(b) For the purposes of this Schedule 10:
(i) "eligible liabilities" and "special deposits" have the
meanings given to them at the time of application of the
formula by the Bank of England; and
(ii) "fee base" has the meaning given to it in the Fees
Regulations;
(iii) "Fees Regulations" means :
(1) prior to 31st March, 1999, the Banking
Supervision (Fees) Regulations 1998; and
(2) on and after 31st March, 1999, any regulations
governing the payment of fees for banking
supervision.
(ii) "relevant period" in relation to each Interest Period,
means:
(A) if it is three months or less, that Interest
Period; or
(B) if it is more than three months, each
successive period of three months and any
necessary shorter period comprised in that
Interest Period.
(c) In the application of the formula, B, Y, S and Z are included in
the formula as figures and not as percentages, e.g. if B = 0.5% and
Y = 15%, BY is calculated as 0.5 x 15.
(d) If a Reference Bank does not supply a rate to the Facility Agent,
the applicable Mandatory Cost will be determined on the basis of
the rate(s) supplied by the remaining Reference Banks.
(e) (i) The formula is applied on the first day of each relevant
period comprised in the relevant Interest Period.
(ii) Each rate calculated in accordance with the formula
is, if necessary, rounded upward to four decimal places.
(f) If the Facility Agent determines that a change in circumstances has
rendered, or will render, the formula inappropriate, the Facility
Agent (after consultation with the Lenders) shall notify the
Company of the manner in which the Mandatory Cost will subsequently
be calculated. The manner of calculation so notified by the
Facility Agent shall, in the absence of manifest error, be binding
on all the Parties.
SIGNATORIES TO THE CREDIT AGREEMENT
Company
DUNLOP STANDARD AEROSPACE GROUP LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
Original Borrowers
DUNLOP STANDARD AEROSPACE (UK) LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ AVIATION LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
DUNLOP STANDARD AEROSPACE OVERSEAS LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
DUNLOP STANDARD AEROSPACE (US) INC.
By: ▇▇▇▇▇ ▇▇▇▇▇
STANDARD AEROSPACE (CANADA) LIMITED (previously known as 351439-1 CANADA INC.)
By: ▇▇▇▇▇ ▇▇▇▇▇
Original Guarantors
DUNLOP STANDARD AEROSPACE GROUP LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
DUNLOP STANDARD AEROSPACE HOLDINGS LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
DUNLOP STANDARD AEROSPACE (UK) LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ AVIATION LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
DUNLOP STANDARD AEROSPACE OVERSEAS LIMITED
By: ▇▇▇▇▇ ▇▇▇▇▇
DUNLOP STANDARD AEROSPACE (US) INC.
By: ▇▇▇▇▇ ▇▇▇▇▇
STANDARD AEROSPACE (CANADA) LIMITED (previously known as 351439-1 CANADA INC.)
By: ▇▇▇▇▇ ▇▇▇▇▇
Arranger
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
Original Lenders
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
LC Bank
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
Facility Agent
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
Security Agent
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
Syndication Agent
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
SIGNATORIES TO THE SUPPLEMENTAL CREDIT AGREEMENT
COMPANY
DUNLOP STANDARD AEROSPACE GROUP LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇
The Obligors
(other than the Company)
DUNLOP STANDARD AEROSPACE (UK) LIMITED
▇▇▇▇▇ AVIATION LIMITED
DUNLOP STANDARD
AEROSPACE OVERSEAS LIMITED
DUNLOP STANDARD AEROSPACE (US) INC.
STANDARD AEROSPACE (CANADA) LIMITED (previously known as 351439-1 CANADA
INC.)
DUNLOP STANDARD AEROSPACE HOLDINGS LIMITED
By Dunlop Standard Aerospace Group Limited as Obligors' Agent
By: ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇
Arranger
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
Original Lenders
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
Facility Agent
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
Security Agent
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
Syndication Agent
THE FUJI BANK, LIMITED
By: ▇▇▇▇ ▇▇▇▇▇▇
SCHEDULE 4
AMENDED AND RESTATED CREDIT AGREEMENT
Conformed copy of the Credit Agreement dated
31st July, 1998 as supplemented and amended by a
supplemental agreement dated 28th September, 1998
CREDIT AGREEMENT
DATED 31st July, 1998
(pound)260,000,000
TERM LOAN FACILITIES
(pound)75,000,000
CAPITAL EXPENDITURE
FACILITY
(pound)50,000,000
REVOLVING CREDIT FACILITY
Between
DUNLOP STANDARD AEROSPACE GROUP LIMITED
and others as Borrowers and/or Guarantors
THE FUJI BANK, LIMITED
as Arranger
THE LENDERS
THE FUJI BANK, LIMITED
as Facility Agent and Security Agent
THE FUJI BANK, LIMITED
as Syndication Agent
THIS CREDIT AGREEMENT IS ENTERED INTO WITH
THE BENEFIT OF AND SUBJECT TO THE TERMS OF A PRIORITY AGREEMENT DATED
ON OR ABOUT THE DATE OF THIS AGREEMENT
▇▇▇▇▇ & ▇▇▇▇▇
London
B3:139964.5
INDEX
Clause Page
1. Interpretation....................................................1
2. The Facilities...................................................27
3. Purpose..........................................................31
4. Conditions Precedent.............................................31
5. Drawdown.........................................................35
6. Optional Currencies..............................................39
7. Ancillary Facilities.............................................41
8. Repayment........................................................42
9. Prepayment And Cancellation......................................45
10. Interest.........................................................49
11. Interest Periods.................................................52
12. Payments.........................................................53
13. Taxes............................................................55
14. Market Disruption................................................58
15. Increased Costs..................................................59
16. Illegality.......................................................60
17. Mitigation.......................................................61
18. Guarantee........................................................62
19. Additional Borrowers, Guarantors And Security....................66
20. Representations And Warranties...................................70
21. Undertakings.....................................................79
22. Financial Covenants.............................................100
23. Default.........................................................110
24. The Agents And The Arranger.....................................117
25. Fees............................................................123
26. Expenses........................................................124
27. Indemnities.....................................................125
28. Evidence And Calculations.......................................127
29. Amendments And Waivers..........................................128
30. Changes To The Parties..........................................129
31. Disclosure Of Information.......................................132
32. Set-Off.........................................................132
33. Pro Rata Sharing................................................132
34. Severability....................................................133
35. Counterparts....................................................134
36. Notices.........................................................134
37. Jurisdiction....................................................134
38. Governing Law...................................................135
Schedules Page
1. Various Parties.................................................136
Part I - Original Borrowers.....................................136
Part II - Original Guarantors...................................138
Part III - Agents...............................................140
2. Lenders and Commitments.........................................141
3. Conditions Precedent Documents..................................142
4. Material Group Subsidiaries.....................................152
5. Form of Request.................................................153
6. Forms of Accession Documents....................................154
Part I - Substitution Certificate...............................154
Part II - Borrower Accession Agreement..........................156
Part III - Guarantor Accession Agreement........................157
Part IV - Alternative Form of Novation Agreement................158
7. Security Documents..............................................166
Part I - Security Documents - To Be Given On Or Prior
To Signing....................................................166
Part II - Security Documents To Be Given At Closing.............167
Part III - Additional Guarantors................................169
Part IV - Additional Borrowers..................................170
8. Form of Documentary Credit......................................171
9. Terms of Lenders' Indemnity to LC Bank..........................180
10. Calculation of the Mandatory Cost...............................182
Signatories to the Credit Agreement........................................184
--------
* Requests for Documentary Credits only.