Exhibit 10.40
Execution Copy
DATED 27TH JULY, 2004
ASIA NETCOM CORPORATION LIMITED
AS BORROWER
THE BANKS AND OTHER FINANCIAL INSTITUTIONS
NAMED IN SCHEDULE 1 AS LENDERS
INDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA) LIMITED
AS ARRANGER
INDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA) LIMITED
AS FACILITY AGENT
AMENDED AND RESTATED FACILITY AGREEMENT
RELATING TO A TERM LOAN FACILITY
OF UP TO US$150,000,000
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
HONG KONG
TABLE OF CONTENTS
CLAUSE PAGE NO.
------ --------
1. DEFINITIONS AND CONSTRUCTION....................................................................... 1
2. THE FACILITY....................................................................................... 26
3. PURPOSE ........................................................................................... 27
4. DRAWDOWN .......................................................................................... 28
5. CONDITIONS PRECEDENT............................................................................... 29
6. REPAYMENT.......................................................................................... 30
7. VOLUNTARY PREPAYMENT, CANCELLATION AND MANDATORY PREPAYMENT........................................ 32
8. INTEREST .......................................................................................... 37
9. SUBSTITUTE BASIS................................................................................... 39
10. INCREASED COSTS.................................................................................... 40
11. ILLEGALITY......................................................................................... 42
12. INDEMNITIES........................................................................................ 43
13. PAYMENTS .......................................................................................... 44
14. TAXES 46
15. REPRESENTATIONS AND WARRANTIES..................................................................... 48
16. UNDERTAKINGS....................................................................................... 51
17. EVENTS OF DEFAULT.................................................................................. 66
18. ASSIGNMENT AND TRANSFER............................................................................ 71
19. THE FACILITY AGENT, THE ARRANGER AND THE LENDERS................................................... 73
20. FEES AND EXPENSES.................................................................................. 79
21. SET-OFF ........................................................................................... 81
22. PRO RATA SHARING................................................................................... 81
23. NOTICES ........................................................................................... 83
24. AGREEMENT TO PERMIT ADDITIONAL LENDERS............................................................. 84
25. AGREEMENT TO PERMIT LENDER TO INCREASE ITS COMMITMENT.............................................. 86
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26. WAIVER; AMENDMENTS AND CONSENTS; REMEDIES, SEVERABILITY AND COUNTERPARTS........................... 87
27. GOVERNING LAW AND JURISDICTION..................................................................... 88
SCHEDULE 1 90
THE ORIGINAL LENDERS AND THEIR COMMITMENTS.................................................................. 90
SCHEDULE 2 91
FORM OF DRAWDOWN NOTICE..................................................................................... 91
SCHEDULE 3 92
DOCUMENTS AND EVIDENCE REQUIRED AS.......................................................................... 92
CONDITIONS PRECEDENT TO FIRST ADVANCE....................................................................... 92
SCHEDULE 4 95
FORM OF AUTHORISED SIGNATORY CERTIFICATE.................................................................... 95
SCHEDULE 5 98
FORM OF TRANSFER CERTIFICATE................................................................................ 98
SCHEDULE 6 101
VENDOR FINANCING ........................................................................................... 101
SCHEDULE 7 102
CONSENTS 102
SCHEDULE 8 103
FINANCIAL COVENANTS......................................................................................... 103
SCHEDULE 9 105
CONFIRMATION OF IPO PROCEEDS................................................................................ 105
SCHEDULE 10 106
FORM OF HYBRID FINANCIAL STATEMENTS AND..................................................................... 106
HYBRID FINANCIAL PRO-FORMAS................................................................................. 106
SCHEDULE 11 108
DEBENTURES 108
SCHEDULE 12 110
SHARE MORTGAGES ............................................................................................ 110
SHARE MORTGAGES TO BE GRANTED BY THE FOLLOWING SECURITY PARTIES IN FAVOUR OF THE SECURITY................... 110
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SCHEDULE 13 112
SUBORDINATION DEEDS........................................................................................ 112
SCHEDULE 14 113
BORROWER'S BRINGDOWN CERTIFICATE........................................................................... 113
SCHEDULE 15 115
GROUP STRUCTURE CHART...................................................................................... 115
SCHEDULE 16 117
INITIAL MATERIAL SUBSIDIARIES.............................................................................. 117
SCHEDULE 17 118
DOCUMENTS REQUIRED TO BE DELIVERED BY AN................................................................... 118
ADDITIONAL SECURITY PARTY.................................................................................. 118
SCHEDULE 18 119
Security PeRfection requirements........................................................................... 119
EXECUTION PAGE ............................................................................................ 126
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THIS AGREEMENT is made on 27th July 2004
BETWEEN:-
(1) ASIA NETCOM CORPORATION LIMITED, a company incorporated under the laws
of Bermuda whose registered office is situate at ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇ (the "BORROWER");
(2) THE BANKS AND OTHER FINANCIAL INSTITUTIONS listed in Schedule 1 as
lenders (collectively the "ORIGINAL LENDERS" and each an "ORIGINAL
LENDER");
(3) INDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA) LIMITED as arranger (in
such capacity, the "Arranger"); and
(4) INDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA) LIMITED as facility
agent for the Finance Parties (in such capacity the "FACILITY AGENT").
WHEREAS:-
The Lenders have agreed, upon the terms and subject to the conditions of this
Agreement, to make available to the Borrower a term loan facility in the maximum
aggregate amount of up to US$150,000,000.
IT IS HEREBY AGREED as follows:-
1. DEFINITIONS AND CONSTRUCTION
1.1 TERMS DEFINED
In this Agreement and the Recitals and the Schedules, unless the
context otherwise requires, the following terms and expressions shall
have the following respective meanings:-
"ADDITIONAL ASSIGNMENT OF INSURANCES" means a document in agreed form
under which a Security Party or, as the case may be, an Additional
Security Party is expressed to create assignments by way of security or
other Security Interests of its rights to Insurances and Insurance
Proceeds or over additional rights to Insurances and Insurance
Proceeds, as the case may be in favour of the Security Trustee in form
and substance satisfactory to the Finance Parties.
"ADDITIONAL DEBENTURE" means a document in agreed form under which a
Security Party or, as the case may be, an Additional Security Party is
expressed to create Security Interests over its assets or over
additional assets as the case may be in favour of the Security Trustee
in form and substance satisfactory to the Finance Parties.
"ADDITIONAL FINANCING" shall have the meaning given to it in Clause
16.17 (No Additional Borrowing).
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"ADDITIONAL LENDERS" shall have the meaning given to it in Clause 24
(Agreement to Permit Additional Lenders).
"ADDITIONAL SECURITY DOCUMENT" means a document in agreed form under
which a Security Party or, as the case may be, an Additional Security
Party is expressed to create Security Interests over particular assets
specified therein or over additional assets specified therein, as the
case may be in favour of the Security Trustee in form and substance
satisfactory to the Finance Parties.
"ADDITIONAL SECURITY PARTY" means at any relevant time a member of the
Borrower Group or the EAN Group which has become or is required by the
Facility Agent to become an Additional Security Party under this
Agreement.
"ADDITIONAL SHARE MORTGAGE" means a document in agreed form under which
a Security Party or, as the case may be, an Additional Security Party
is expressed to create Security Interests over inter alia, shares owned
by that Security Party or, as the case may be that Additional Security
Party in any person in favour of the Security Trustee in form and
substance satisfactory to the Finance Parties.
"ADDITIONAL SUBORDINATION DEED" means a document in agreed form under
which a Security Party, or as the case may be, an Additional Security
Party inter alia, subordinates its rights in respect of loans or
advances made or to be made by it to members of the Group and, as
appropriate, its obligations in respect of loans or advances made or to
be made to it by members of the Group, in each case, to the
Indebtedness constituted by this Agreement in form and substance
satisfactory to the Finance Parties.
"ADVANCE" means either a Tranche A Advance or a Tranche B Advance.
"AFFILIATE" means, in relation to any person, a Subsidiary of that
person or a Holding Company of that person or any other Subsidiary of
that Holding Company.
"AGREED PROPORTIONS" shall have the meaning given to it in Clause 2.2
(Pro Rata Participation).
"ALTERNATIVE FURTHER FINANCING" shall have the meaning given to it in
Clause 16.17 (No Additional Borrowing).
"ANC MORTGAGED SHARES" means 100% of the shares in the Borrower which
shares are held legally and beneficially directly or indirectly by CNC
International and which are the subject of the ANC Share Mortgage.
"ANC SHARE MORTGAGE" means the share mortgage to be entered into by CNC
International in favour of the Security Trustee over the ANC Mortgaged
Shares and the other Charged Assets (as defined therein) in form and
substance satisfactory to the Finance Parties.
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"APPROVED CAPITAL EXPENDITURE" means any expenditure by the Borrower
Group on capital equipment and working capital (excluding repayment or
refinancing or any other payment in respect of the Vendor Financing)
and costs, fees and expenses directly incurred in connection with this
Facility.
"APPROVED OFFICER" means the chief financial officer of the Borrower or
the person as notified to the Facility Agent in writing from time to
time who is a senior financial officer of the Borrower.
"ASSETCO" means CNC Network Corporation Limited, a company incorporated
in the British Virgin Islands, whose registered office is at Romasco
Place, ▇▇▇▇▇▇▇'▇ ▇▇▇ 1, Road Town, Tortola, British Virgin Islands, the
immediate Holding Company of EAN and a wholly owned Subsidiary of China
Netcom Holdings (BVI) Limited.
"ASSETCO GROUP" means AssetCo and each of its Subsidiaries.
"AVAILABLE COMMITMENT" means in relation to a Facility, a Lender's
Commitment under that Facility minus:
(a) the amount of its participation in any outstanding Loan under
that Facility; and
(b) in relation to any proposed Advance, the amount of its
participation in any Advances that are due to be made under
that Facility on or before the proposed Drawdown Date.
"AVAILABLE FACILITY" means, in relation to a Facility, the aggregate
for the time being of each Lender's Available Commitment in respect of
that Facility.
"BACKHAUL/OFFNET OVERHANG" means cash outflow incurred by a member of
the Borrower Group for the purchase of IRU Capacity from a third party
in respect of which a member of the Borrower Group has already received
payment from a customer purchasing IRU Capacity from a member of the
Borrower Group.
"BORROWER GROUP" means the Borrower and each of its Subsidiaries.
"BUSINESS DAY" means:-
(a) for the purposes of determining LIBOR, a day on which Dollar
deposits may be dealt with in the London interbank market;
(b) in relation to a day on which payment is to be made in
Dollars, a day (other than a Saturday or a Sunday) on which
banks are open for business in Beijing, London, Hong Kong and
New York; and
(c) in relation to any other day, a day (other than a Saturday or
a Sunday) on which banks are open for business in London,
Beijing and Hong Kong.
"BREAKAGE COSTS" means the amount (if any) by which:
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(a) the interest which a Lender should have received for the
period from the date of receipt of all or any part of its
participation in a Loan or Unpaid Sum to the last day of the
current Interest Period in respect of that Loan or Unpaid Sum,
had the principal amount or Unpaid Sum received been paid on
the last day of that Interest Period;
exceeds:
(b) the amount which that Lender would be able to obtain by
placing an amount equal to the principal amount or Unpaid Sum
received by it on deposit with a leading bank in the London
interbank market for a period starting on the Business Day
following receipt or recovery and ending on the last day of
the current Interest Period.
"CHARGE OVER ACCOUNT" means a charge over the Escrow Accounts to be
entered into by the Borrower in favour of the Security Trustee in form
and substance satisfactory to the Finance Parties.
"CHARGE OVER DEPOSIT" means a charge over the Deposit to be entered
into by the Borrower in favour of the Security Trustee in form and
substance satisfactory to the Finance Parties.
"CHINA NETCOM" means China Netcom Corporation Limited [CHAINISE
CHARACTOR], a wholly foreign owned corporation organized under the laws
of the People's Republic of China and a Subsidiary of the Guarantor
having registration number 0443376 whose principal place of business is
at ▇▇.▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, Development Area, Beijing 100176,
PRC.
"CHINA NETWORK" means China Network Communications Group Corporation,
whose principal place of business is at No. 156 Fu Xin Min Nei Da Jie,
Xicheng District, Beijing 100032, PRC.
"CHINA NETWORK COMFORT LETTER" means a letter agreement between China
Network and the Facility Agent stating China Network's support for the
Borrower in the agreed form.
"CNC HK" means China Netcom Corporation (Hong Kong) Limited, a limited
liability company incorporated under the laws of Hong Kong, whose
registered office is at 59/F., Bank of ▇▇▇▇▇ ▇▇▇▇▇, ▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇.
"CNC HK GROUP" means CNC HK and each of its Subsidiaries.
"CNC HK GUARANTEE" means an unconditional and irrevocable guarantee and
indemnity to be entered into by CNC HK in favour of the Security
Trustee in respect of the obligations of the Borrower under the Finance
Documents in form and substance satisfactory to the Finance Parties.
"CNC INTERNATIONAL" means China Netcom Corporation International
Limited whose registered address is at ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇.
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"COA EXPENSES" means the aggregate of all costs, charges, expenses or
the like calculated in accordance with US GAAP, payable by members of
the Borrower Group to any of its joint venture partners or other third
party telecommunications, information technology, or Internet network,
or service providers for the provision of the following services and
capacity (but not including IRUs):-
(a) International Circuits;
(b) Local Loops;
(c) IP Transit Charges;
(d) Voice Usage;
(e) Internet Peering Charges;
(f) Managed Router; and
(g) any other similar expenses that are not OA&M Expenses or SG&A
Expenses,
in each case excluding any prepayments made by a member of the Borrower
Group in respect thereof.
"COLLATERAL" means together all the assets over which the Security
Parties have created or are to create a Security Interest in favour of:
(a) the Security Trustee, and/or
(b) any of the Vendor Financing Secured Parties which Security
Interests are to be transferred to NewCo pursuant to the Deeds
of Transfer, Release and Settlement,
and any documents contemplated thereunder.
"COMMITMENT" means a Tranche A Commitment or a Tranche B Commitment.
"CONFIRMATION OF IPO PROCEEDS" means a notice substantially in the form
of Schedule 9 (IPO Notice Confirmation of IPO Proceeds).
"CONSENT" means each of the consents, approvals, registrations, permits
and other matters referred to in Schedule 7.
"CPE" means customer premises equipment purchased by a member of the
Borrower Group for a customer with title to such equipment transferred
to that customer at a pre-determined later date.
"CURRENCY EQUIVALENT" of any amount denominated in any currency at any
time means:
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(a) if such amount is denominated in Dollars the amount therefor
in Dollars; and
(b) in any other case, the equivalent of such amount in Dollars,
as determined by the Facility Agent in its sole discretion, at
such time; provided that, for these purposes in relation to
any amount denominated in a currency other than Dollars in
respect of which the Borrower or any member of the Borrower
Group, or, as the case may be, AssetCo or any member of the
AssetCo Group, has the benefit of any instrument issued by a
third party providing a fixed rate of exchange from Dollars
into such currency and which is available to be used at the
time of such conversion, the amount of Dollars required at
such time, as determined by the Facility Agent in its sole
discretion, in order to purchase such amount in the currency
in which it is denominated using the rate of exchange provided
for in such instrument at such time.
"DEBENTURES" means collectively the debentures or similar security
documents in agreed form creating Security Interests to be entered into
by the relevant Security Party set out in Schedule 11 Column 1 in
favour of the Security Trustee and other Finance Party as the case may
be, over assets of the members of the Borrower Group and/or the EAN
Group in form and substance satisfactory to the Finance Parties.
"DEBT SERVICE" means in relation to a stated period the principal
repayments and interest payments of the outstanding Indebtedness of the
Borrower Group in respect of that period but excluding the Vendor
Financing.
"DEBT SERVICE COVERAGE RATIO" means the ratio of:-
(a) Total Cash Available for Debt Service;
to
(b) Debt Service.
"DEEDS OF TRANSFER, RELEASE AND SETTLEMENT" means together the NEC Deed
of Transfer, Release and Settlement and the KDDI Deed of Transfer,
Release and Settlement.
"DEFAULT" means any Event of Default or any event which with the giving
of notice or lapse of time or the satisfaction of any other condition
or making of any relevant determination or forming of any opinion under
the Finance Documents (or any combination thereof) would constitute an
Event of Default.
"DEFAULT RATE" means the annual rate of interest determined by the
Facility Agent to be the aggregate of (a) the Margin, (b) LIBOR or, if
the provisions of Clause 9.1 (Market Disruption) apply, the cost to
each Lender referred to in Clause 9.3(b) (No Agreement) and (c) 2% per
annum.
"DEPOSIT" means the cash deposit or other cash instruments reasonably
acceptable to the Facility Agent in a principal amount of, subject to
Clause 16.18 (Cash Deposits), not less than US$50,000,000 to be made
under Clause 16.18 (Cash Deposits) by the
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Borrower with the Facility Agent together with all interest accrued
thereon from time to time.
"DEPOSIT ACCOUNT" means the US$ interest bearing account opened and
maintained with the Facility Agent in Hong Kong in the name of the
Borrower into which the Deposit is to be deposited.
"DISPOSITION" means any sale, assignment, transfer, exchange or other
disposition of any assets or any rights or interests therein or thereto
(whether now owned or hereafter acquired) by any member of the Borrower
Group to any person but excluding dispositions of any obsolete or
worn-out property sold or disposed of on arm's length ordinary business
terms.
"DISPOSITION PROCEEDS" means in the case of any Disposition, the
aggregate amount of all cash payments, and the cash equivalent of the
fair market value of any non-cash consideration, received by any member
of the Group directly or indirectly in connection with such
Disposition.
"DISPOSITION PROCEEDS ESCROW ACCOUNT" means the account opened and
maintained with the Security Trustee in the name of the Borrower for
the purpose of holding amounts paid under the proviso to Clause
7.5A(a).
"DOLLARS" or "US$" means the lawful currency for the time being of the
United States of America.
"DRAWDOWN DATE" means each date, being a Business Day falling within
the Drawdown Period, on which an Advance is or is to be drawn.
"DRAWDOWN NOTICE" means a notice substantially in the form of Schedule
2 (Form of Drawdown Notice).
"DRAWDOWN PERIOD" means the period commencing on the date of this
Agreement and ending on the earlier of (i) 31st March, 2005 and (ii)
the date the amount of the Facility has been reduced to nil.
"EAC NETWORK" means the fibre optic cable network of the EAN Group
excluding network capacity purchased from third parties.
"EAN" means East Asia Netcom Ltd., an exempted company incorporated in
Bermuda, whose registered office is at ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇.
"EAN GROUP" means EAN and each of its Subsidiaries.
"EAN GUARANTEE" means an unconditional and irrevocable guarantee and
indemnity to be entered into by EAN in favour of the Security Trustee
in respect of the obligations of the Borrower and the other Security
Parties under the Finance Documents in form and substance satisfactory
to the Finance Parties.
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"EAN MORTGAGED SHARES" means 100% of the shares in EAN which shares are
held legally and beneficially directly by AssetCo and which are the
subject of the EAN Share Mortgage.
"EAN SHARE MORTGAGE" means the share mortgage to be entered into by
AssetCo in favour of the Security Trustee over the EAN Mortgaged Shares
and the other Collateral (as defined therein) in form and substance
satisfactory to the Finance Parties.
"EBITDA" means in relation to a stated period, the amount equal to
Total Revenue less Total Expenses.
"EFFECTIVE DATE" means the date on which the Facility Agent notifies
the Borrower in writing that all the conditions in Clause 2 of the
Supplemental Amendment and Restatement Deed shall have been satisfied
or waived by the Finance Parties.
"ESCROW ACCOUNTS" means collectively the Prepayment Escrow Account, the
Insurance Proceeds Escrow Account, the Disposition Proceeds Escrow
Account and the Requisition Proceeds Escrow Account.
"EXISTING SHAREHOLDER LOANS" means collectively the three shareholder
loans made by CNC HK to the Borrower on 15 March 2004, 25 March 2004
and 1 April 2004 respectively and the shareholder loan made by CNC
International to the Borrower on 7 April 2004, and which together with
all interest and other costs in respect thereof in aggregate do not at
the Effective Date exceed US$20,900,000.
"EXPROPRIATION" means the expropriation, appropriation, confiscation,
compulsory acquisition, deprivation, requisition for title or use of
one person's asset(s) by another.
"EVENT OF DEFAULT" means any of the events or circumstances described
in Clause 17.1 (Events of Default).
"FACILITY" means Tranche A or Tranche B or, where the context permits
the total transferable term loan facility to be made available by the
Lenders to the Borrower on the terms set out in this Agreement.
"FACILITY OFFICE" means the office or offices notified by a Lender to
the Facility Agent in writing on or before the date it becomes a Lender
(or, following that date, by not less than 5 Business Days written
notice) as the office or offices through which it will perform its
obligations under this Agreement.
"FEE LETTER" means any letter or letters dated on or about the date of
this Agreement between the Arranger and/or the Facility Agent and the
Borrower referred to in Clause 20 (Fees and Expenses) setting out any
agreed fees.
"FINAL MATURITY DATE" means the earlier of (a) the date falling 5 years
from the First Drawdown Date; and (b) 31st July, 2009.
"FINANCE PARTY" means the Facility Agent, the Arranger or a Lender.
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"FINANCIAL COVENANT TEST DATE" means 31st March, 30th June, 30th
September and 31st December in each calendar year.
"FINANCE DOCUMENTS" means collectively, this Agreement, the Security
Documents, the Fee Letter and any other document designated as such by
the Facility Agent and the Borrower.
"FINANCIAL INDEBTEDNESS" means any Indebtedness for or in respect of:-
(a) monies borrowed and debit balances at banks;
(b) any amount raised under any note purchase facility on the
issue of any debenture, bond, note, loan stock or other
instrument or security;
(c) any acceptance credit;
(d) receivables sold or discounted (otherwise than on a
non-recourse basis);
(e) the acquisition cost of any asset to the extent payable before
or after the time of acquisition or possession by the party
liable where the advance or deferred payment is arranged
primarily as a method of raising finance or financing the
acquisition of that asset;
(f) leases or hire purchase contracts entered into primarily as a
method of raising finance or financing the acquisition of the
asset leased unless the aggregate financing amount of all such
leases at any time does not exceed US$500,000;
(g) net amount payable in respect of currency swap or interest
rate swap, cap or collar arrangements or other derivative
instruments;
(h) amounts raised under any other transaction having the
commercial effect of a borrowing or raising of money;
(i) preferred shares or shares which are issued or the terms of
which are varied in each case after the Effective Date and
which are expressed to be redeemable;
(j) deferred payments for assets (other than current assets) or
services acquired other than on trade credit terms in the
ordinary course of a person's business; and
(k) any guarantee, indemnity (including counter indemnity) or
similar assurance against financial loss of any other person,
but no particular Indebtedness shall be taken into account more than
once.
"FINANCIAL YEAR" means each period commencing on 1 January in a
calendar year and ending on 31 December in that calendar year.
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"FIRST DRAWDOWN DATE" means the first date on which an Advance is made
under this Agreement.
"FREE CASH" means US GAAP Cash less the sum of (i) US GAAP Restricted
Cash and (ii) Restricted Cash.
"FURTHER FINANCING" shall have the meaning given to it in Clause 16.17
(No Additional Borrowing).
"GROSS INTEREST" means in relation to any stated financial period, the
aggregate of all interest, fees, commission, discounts (other than
trade discounts) and other cost, charges or expenses accruing due from
the Borrower Group on a consolidated basis during such financial period
in respect of the Financial Indebtedness of the Borrower Group,
including without limitation:
(i) capitalised interest;
(ii) the portion of any payments under finance leases which exceeds
the reduction of the principal indebtedness under such leases
resulting from such payments; and
(iii) the amount by which the price payable on redemption of any
debt securities issued by the Borrower Group exceeds the
original issue proceeds thereof,
without deduction in respect of interest (including capitalised
interest) received by the Borrower Group on a consolidated basis during
such period.
"GROUP" means together the CNC HK Group, China Network, and the AssetCo
Group, including, for the avoidance of doubt all Material Subsidiaries
for the time being.
"GROUP ASSIGNMENTS OF INSURANCES" means collectively each assignment by
way of security and/or composite assignment by way of security of the
Insurances and Insurance Proceeds to be entered into by any one or more
of the Security Parties in favour of the Security Trustee in form and
substance satisfactory to the Finance Parties.
"GROUP STRUCTURE CHART" means the Group Structure Chart set out in
Schedule 15 setting out the structure of the Borrower Group and the EAN
Group as at the Effective Date.
"GUARANTEES" means the CNC HK Guarantee and the EAN Guarantee.
"GUARANTORS" means (i) CNC HK, and (ii) EAN and "GUARANTOR" means any
one of them.
"GUARANTOR IPO DATE" shall have the meaning given to it in the CNC HK
Guarantee.
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"GUARANTOR STOCK EXCHANGES" means the Main Board of the Stock Exchange
of Hong Kong Limited and/or the New York Stock Exchange.
"HOLDING COMPANY" means in relation to any person, an entity of which
that person is a Subsidiary.
"HONG KONG" means the Hong Kong Special Administrative Region of the
People's Republic of China.
"HYBRID FINANCIAL PRO-FORMA" means in relation to any relevant future
financial period, the consolidated cash and US GAAP hybrid financial
projections in respect of the Borrower Group for that period prepared
by the Borrower and delivered to the Facility Agent, such projections
to be in substantially the form of Schedule 10 Part A.
"HYBRID FINANCIAL STATEMENT" means in relation to any relevant
financial period, consolidated cash and US GAAP hybrid financial
statements of the Borrower Group for such period such statements to be
in substantially the form set out in Schedule 10 Part B.
"INDEBTEDNESS" means any obligation for the payment or repayment of
money, whether as principal or as surety and whether present or future,
actual or contingent, primary or collateral, several or joint, secured
or unsecured, subordinated or unsubordinated.
"INITIAL GROUP ASSIGNMENT OF INSURANCES" means the assignment by way of
security of Insurances and Insurance Proceeds to be entered into by,
inter alia, the Borrower and EAN in favour of the Security Trustee in
form and substance satisfactory to the Finance Parties.
"INITIAL DEBENTURES" means each of the Debentures nos 1 to 10 inclusive
in Schedule 11 to be entered into by the relevant Security Party listed
in Schedule 11, in favour of the Security Trustee in form and substance
satisfactory to the Finance Parties.
"INITIAL SHARE MORTGAGES" means each of the Share Mortgages nos 1 to 13
inclusive in Schedule 12 to be entered into by the relevant Security
Party listed in Schedule 12 in favour of the Security Trustee in form
and substance satisfactory to the Finance Parties.
"INITIAL SUBORDINATION DEEDS" means each of the Subordination Deeds
listed in Schedule 13 to be entered into by the relevant Security
Parties referred to in Schedule 13 in favour of the Security Trustee in
form and substance satisfactory to the Finance Parties.
"INSURANCE PROCEEDS" means the proceeds of Insurances received or
receivable by any member of the Borrower Group or the AssetCo Group.
"INSURANCE PROCEEDS ESCROW ACCOUNT" means the account opened and
maintained with the Security Trustee in the name of the Borrower for
the purposes of holding amounts paid under the proviso to Clause
7.5A(c).
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"INSURANCES" means all policies and contracts of insurance of any kind
and every renewal thereof, in respect of which any member of the
Borrower Group or the AssetCo Group has or in the future may have any
right, title or interest (including, without limitation as loss payee
or co-insured), and in particular, but without limitation, the
insurance which is to be maintained pursuant to Clause 16.5
(Insurance).
"INTERCREDITOR AGREEMENT" means an intercreditor agreement entered
into, or to be entered into, by NewCo, the Security Trustee for and on
behalf of the Finance Parties, EAN, the Junior Security Provider (as
defined therein), the Senior Security Providers and the Borrower,
whereby, among other things, NewCo agrees to subordinate in all
respects its right to the Junior Debt (as defined therein) and the
Junior Security (as defined therein) and which sets outs the terms upon
which any enforcement by NewCo of any or all of its rights thereunder
or in respect thereof shall be subject and subordinated, both in
priority and decision making, to the Security Trustee (acting on the
instructions of the Finance Parties).
"INTEREST EXPENSE" means in relation to a stated period, the aggregate
of all interest (including, without limitation, the interest element of
leasing and hire purchase payments and interest which has been
capitalised), commission, fees, discount and other charge accruing
during such period in respect of the indebtedness for borrowed money of
each member of the Borrower Group and the net amount payable in respect
of any interest hedging arrangements (or, as the case may be, deducting
the amount receivable in respect of interest hedging arrangements) in
respect of such relevant period in the case of any other credit
facility and Interest Expense payable under such facility prior to the
date on which the same ceases to be available for drawing to the extent
that such facility is available for the payment of such Interest
Expense.
"INTEREST PAYMENT DATE" means the last day of an Interest Period.
"INTEREST PERIOD" means each period for the calculation of interest in
respect of any Advance or the Loan ascertained in accordance with
Clauses 8.2 (Interest Periods), 8.3 (Day Count Convention) or 8.4
(Default Interest).
"INTERNATIONAL CIRCUITS" means telecommunications transmission
facilities, in the form of telecommunications submarine or land cables,
satellites or otherwise, connecting two jurisdictions.
"INTERNATIONALLY RECOGNISED STOCK EXCHANGE" means any internationally
recognized stock exchange or over-the-counter market, and shall include
the Main Board of The Stock Exchange of Hong Kong Limited, The Growth
Enterprise Market of The Stock Exchange of Hong Kong Limited, New York
Stock Exchange, the NASDAQ or any other recognized stock exchange (as
defined in section 49BA of the Companies Ordinance (Cap. 32 of the Laws
of Hong Kong).
"INTERNET PEERING CHARGES" means charges payable for the delivery and
termination of data through the Internet.
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"IPO" means the becoming effective of a listing of any share capital of
any member of the Borrower Group or the EAN Group on an Internationally
Recognised Stock Exchange.
"IPO NET PROCEEDS" means all monies raised by any member of the
Borrower Group or the EAN Group from an IPO of its shares less all
costs, expenses, Taxes, fees and commissions paid or incurred by any
such member of the Borrower Group or the EAN Group in connection
therewith.
"IP TRANSIT CHARGES" means the charges for the delivery of data by
means of Internet Protocol networks including any fees payable for
termination of traffic into the United States of America.
"IRU" means an indefeasible right of use.
"IRU AGREEMENT" means an agreement or arrangement by which a member of
the Borrower Group grants IRU Capacity to a customer in return for
payments of IRU Cash Revenue and OA & M Revenues.
"IRU CAPACITY" means indefeasible rights of use of capacity on any
cable network.
"IRU CAPACITY PROVIDER" means a provider of IRU Capacity.
"IRU CASH REVENUE" means payments received by any member of the
Borrower Group in return for the grant of rights under an IRU Agreement
less all costs, expenses, Taxes, fees and commissions paid or incurred
by any member of the Borrower Group in connection therewith.
"KDDI" means KDDI Submarine Cable Systems Inc., a corporation organised
under the laws of Japan.
"KDDI DEED OF TRANSFER, RELEASE AND SETTLEMENT" means the agreement to
be entered into between EAN, the Borrower, NewCo, KDDI, DB Trustees
(Hong Kong) Limited, and the Security Trustee relating to the transfer
of the rights in respect of the Vendor Financing from KDDI and the
Vendor Financing Security Documents granted in favour of KDDI or the
Vendor Security Trustees.
"LENDER" means:
(a) any Original Lender;
(b) any bank, financial institution, trust, fund or other person
which is a New Lender in accordance with Clause 18 (Assignment
and Transfer); and
(c) any bank or financial institution which is an Additional
Lender in accordance with Clause 24 (Agreement to Permit
Additional Lenders).
"LIBOR" means, in relation to any relevant sum and any relevant
period:-
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(a) the annual rate of interest displayed on Moneyline Telerate
Page 3750 (or such page as may replace that page from time to
time) as being the rate per annum at which Dollar deposits are
offered for a period equal or comparable to such period at or
about 11:00 a.m. (London time) on the second Business Day
before the first day of such period (the "QUOTATION DATE"); or
(b) if, on the Quotation Date, no such rate appears on Moneyline
Telerate Page 3750 (or such page as may replace that page from
time to time) or no such page is on display, the arithmetic
mean (rounded upwards, if necessary, to the nearest 1/16%) of
the respective rates quoted by the Reference Banks to the
Facility Agent as their offered rates to leading banks in the
London interbank market for deposits in Dollars in an amount
comparable to such sum for such period at or about 11:00 a.m.
(London time) on the Quotation Date provided that if any
Reference Bank does not quote such a rate to the Facility
Agent for any relevant period, LIBOR for such period shall be
determined on the basis of the rates quoted by the other
Reference Banks, subject as provided in Clause 9 (Substitute
Basis).
For the purposes of this definition, "RELEVANT PERIOD" means in
relation to an Advance or the Loan, as the case may be, each Interest
Period or, in relation to any unpaid sum, the period in respect of
which LIBOR falls to be determined with respect to such unpaid sum.
"LOAN" means either the Tranche A Loan or the Tranche B Loan or where
the context requires, both of them.
"LOCAL LOOPS" means a circuit connecting the premises of end users to
the technical site of a member of the Borrower Group.
"MANAGED ROUTER" means a Switch for internet network.
"MANDATORY PREPAYMENT" means a prepayment of all or part of the Tranche
A Loan and the Tranche B Loan pursuant to Clause 7.5 (Mandatory
Prepayment).
"MAJORITY LENDERS" means:
(a) if there are no Loans then outstanding, a Lender or Lenders
whose Commitments aggregate more than 66 2/3% of the Total
Commitments (or, if the Total Commitments have been reduced to
zero, aggregated more than 66 2/3% of the Total Commitments
immediately prior to the reduction); or
(b) at any other time, a Lender or Lenders whose participations in
the Loans then outstanding aggregate more than 66 2/3% of all
the Loans then outstanding.
"MATERIAL SUBSIDIARY" means:
(a) the persons listed in Schedule 16; and
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(b) any Subsidiary of the Borrower (i) whose turnover is equal to
at least 10% of the turnover of the Borrower as disclosed in
the latest audited financial statements of the Borrower
delivered pursuant to Clause 16.2; or (ii) whose net assets
exceed 10% of the consolidated total assets of the Borrower as
determined by the Facility Agent by reference to the latest
audited financial statements of the Borrower delivered
pursuant to Clause 16.2; and
(c) any Subsidiary of EAN (i) whose turnover is equal to at least
10% of the turnover of EAN as disclosed in the latest audited
financial statements of EAN delivered pursuant to Clause 7.2
of the EAN Guarantee; or (ii) whose net assets exceed 10% of
the consolidated total assets of EAN as determined by the
Facility Agent by reference to the latest audited financial
statements of EAN delivered pursuant to Clause 7.2 of the EAN
Guarantee;
PROVIDED THAT:
(i) the net assets or turnover of a Subsidiary of the
Borrower or a Subsidiary of EAN will be determined
from their respective financial statements
(consolidated if it has Subsidiaries) upon which the
latest audited financial statements of the Borrower
Group or the EAN Group (as the case may be) have been
based;
(ii) if a Subsidiary of the Borrower or, as the case may
be, of EAN becomes a member of the Borrower Group or,
as the case may be, the EAN Group, after the date on
which the latest audited financial statements of the
Borrower Group or, as the case may be, the EAN Group
have been prepared, the net assets or turnover of
that Subsidiary will be determined from its latest
financial statements until the Borrower Group or, as
the case may be, the EAN Group produces its next
audited financial statements;
(iii) the net assets or turnover of the Borrower Group and
the EAN Group will be determined from its latest
respective audited financial statements, adjusted
(where appropriate) to reflect the net assets or
turnover of any company or business subsequently
acquired or disposed of;
(iv) if a Material Subsidiary disposes of all or
substantially all of its assets to another Subsidiary
of the Borrower or EAN, it will, subject to paragraph
(b) of this definition, immediately cease to be a
Material Subsidiary and the other Subsidiary (if it
is not already) will immediately become a Material
Subsidiary; the subsequent financial statements of
those Subsidiaries, of the Borrower Group and of the
EAN Group will be used to determine whether those
Subsidiaries are Material Subsidiaries or not,
If there is a dispute as to whether or not a company is a Material
Subsidiary, a certificate of the auditors of the Borrower or, as the
case may be EAN will be, in the absence of manifest error, conclusive.
[Facility Agreement]
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"MARGIN" means 1.573% per annum.
"NEC" means NEC Corporation, a corporation organised under the laws of
Japan.
"NEC CONTRACT" means the project development and construction contract,
dated 13th October 2000 (as amended from time to time) between NEC and
EAN whereby NEC agreed to provide, and EAN agreed to purchase the
submarine fiber optic cable system known as East Asia Crossing Cable
System Phase 2 (as more fully described in such contract).
"NEC DEED OF TRANSFER, RELEASE AND SETTLEMENT" means the agreement to
be entered into between EAN, the Borrower, China Netcom Holdings (BVI)
Limited, NewCo, NEC, DB Trustees (Hong Kong) Limited, and the Security
Trustee relating to the transfer of the rights in respect of the Vendor
Financing from NEC and the Vendor Financing Security Documents granted
in favour of NEC or the Vendor Security Trustees.
"NET DEBT" means, in relation to a stated period, the Financial
Indebtedness of the Borrower Group less Free Cash.
"NEWCO" means Group Wealth Finance Limited, a company incorporated in
the British Virgin Islands whose registered office at P.O. Box 957,
Offshore Incorporations Centre, Road Town, Tortola, British Virgin
Islands being a wholly owned Subsidiary of EAN.
"NEW LENDER" shall have the meaning attributed to it in Clause 18.4
(Transfer Certificates).
"OA & M CASH REVENUE" means payments received by any member of the
Borrower Group in consideration for the operation and maintenance
service provided under an IRU Agreement.
"OA&M EXPENSES" means the aggregate of the following three items:-
(a) cash payments to Third Party IRU Capacity Providers for
maintenance used by the relevant member of the Borrower Group
or of the EAN Group under a Third Party IRU Agreement;
(b) cash payments to third party companies engaged by a member of
the Borrower Group to maintain the EAC Network; and
(c) US GAAP calculation of internal costs either directly
attributable or allocated to the maintenance of the EAC
Network from SG&A Expenses.
"OBLIGORS" means the Borrower and the Guarantors.
"ORIGINAL FACILITY AGREEMENT" means the Facility Agreement signed by
the Borrower, the Original Lenders, China Everbright Bank, the Arranger
and the Facility
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Agent, on 2 December, 2003 but held undated in escrow pursuant to an
escrow authorisation letter dated 2 December 2003 between the same
parties, as amended and extended from time to time.
"OUTSTANDINGS" means in relation to a Lender at any relevant time the
principal amount of the Tranche A Loan and the Tranche B Loan owing to
such Lender.
"PCL" means Pacific Holdings Limited and its Subsidiaries currently in
Chapter 11 of Title 11 of the United States Code in the United States
Bankruptcy Court of the Southern District of New York.
"PCL OVERHANG" means in relation to a stated period expenditure to be
incurred for that period by a member of the Borrower Group in respect
of which a member of the Borrower Group has already received payment.
"PRC" means the People's Republic of China and where the context admits
includes the Hong Kong Special Administrative Region.
"PERMITTED INDEBTEDNESS" means:-
(a) any one of:
(i) the Further Financing; or
(ii) the Additional Financing; or
(iii) Alternative Further Financing;
(b) any other indebtedness (i) raised by the Borrower or EAN with
the prior written consent of the Lenders and (ii) which the
Lenders have agreed in writing is not required to be applied
to make a Mandatory Prepayment; or
(c) any Indebtedness referred to in Clause 16.16(a)(v) (Borrower
Negative Pledge) and in the provisions of Clause 7.15(a)(v) of
the EAN Share Mortgage.
"PREPAYMENT ESCROW ACCOUNT" means the interest bearing account opened
and maintained with the Security Trustee in the name of the Borrower
into which any amount comprising Mandatory Prepayments are paid in
accordance with Clause 7.5 (Mandatory Prepayments) including any
sub-accounts thereof.
"REFERENCE BANKS" means the principal London offices of Bank of China,
Citibank N.A., and HSBC Bank plc or any substitute reference banks
appointed pursuant to Clause 18.10 (Reference Banks).
"REPAYMENT DATES" means the dates set out in Column 2 of the table in
Clause 6.1 under "Repayment Date".
"REQUISITION PROCEEDS" means any and all amounts (other than Insurance
Proceeds) payable by any relevant governmental or other competent
authority or by any person
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acting by authority of the same in respect of any compensation or
reimbursement of fees or otherwise payable in consequence of an
Expropriation of an asset of any member of the Borrower Group or any
member of the EAN Group or of any of AssetCo's right title or interest
in and to any member of the EAN Group (after deducting the amount
required by any other member of the Borrower Group or other member of
the EAN Group to pay as compensation attributable to such event to
third parties that are not Affiliates of the Borrower Group or the EAN
Group).
"REQUISITION PROCEEDS ESCROW ACCOUNT" means the account opened and
maintained with the Security Trustee in the name of the Borrower for
the purposes of holding amounts paid under the proviso to Clause
7.5A(d).
"RESTRICTED CASH" means, in respect of one or more members of the
Borrower Group and the EAN Group, cash deposited or credit balances
with a financial institution in a jurisdiction imposing restrictions,
penalties and/or duties for the remittance of such cash or credit
balances or part of any thereof outside that jurisdiction in each case
not subject to a Security Interest.
"RIGHT OF FIRST REFUSAL AGREEMENT" means the agreement between CNC HK
and the Borrower whereby CNC HK grants the Borrower on behalf of the
Borrower Group a right of first refusal or other similar arrangement
reasonably acceptable to the Facility Agent in respect of any network
capacity or service requirements of the Restricted Group (as defined
therein) terminating outside China but within the Asia Pacific region
in form and substance reasonably acceptable to the Facility Agent but
subject to any contractual obligations which CNC HK may have entered
into prior to 2nd December 2003.
"SECURITY ASSIGNMENT OF THE RIGHT OF FIRST REFUSAL AGREEMENT" means the
assignment by way of security of the Right of First Refusal Agreement
entered into or to be entered into by the Borrower in favour of the
Security Trustee in form and substance satisfactory to the Finance
Parties.
"SECURITY DOCUMENTS" means collectively:
(a) the Debentures;
(b) the Guarantees:
(c) the China Network Comfort Letter;
(d) the Group Assignments of Insurances;
(e) the Subordination Deeds;
(f) the Share Mortgages;
(g) the Charge Over Deposit;
(h) the Right of First Refusal Agreement;
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(i) the Security Assignment of the Right of First Refusal
Agreement;
(j) the Charge Over Account;
(k) the Vendor Financing Security Documents;
(l) the Deeds of Transfer, Release and Settlement;
(m) the Vendor Financing Transfer Documents;
(n) the Intercreditor Agreement;
(o) each Additional Debenture;
(p) each Additional Share Mortgage;
(q) each Additional Assignment of Insurances;
(r) each Additional Subordination Deed; and
(s) each Additional Security Document;
and any other document executed from time to time by whatever person as
a further guarantee or security for the Borrower's obligations
hereunder or any other Security Party's obligations under any other
Finance Document and "SECURITY DOCUMENT" means any of them.
"SECURITY INTEREST" means any mortgage, charge (whether fixed or
floating), pledge, lien, hypothecation, assignment, security interest
or encumbrance of any other kind securing or conferring any priority of
payment in respect of any obligation of any person and including any
right granted by a transaction which, in legal terms, is not the
granting of security but which has an economic or financial effect
similar to the granting of security in each case under any applicable
law.
"SECURITY PARTY" means the Borrower, the Guarantors, China Network,
each other member of the Group and, where the context permits, any
Additional Security Party or other person which has provided, or
subsequently provides, a guarantee of or security, for all or any part
of the obligations under the Finance Documents.
"SECURITY PERFECTION REQUIREMENTS" means with respect to a Security
Document payment of all stamp and documentary taxes and duties
(including the payment of all such taxes and duties upon a revaluation
of the Collateral the subject of such Security Document) required to be
paid in any jurisdictions in order for the relevant Security Document
to be admissible in evidence in the courts of those jurisdictions and
valid, binding and enforceable and any other registration or notice
requirement which is required in order to make the Security Document
fully enforceable in Hong Kong and in the jurisdiction of the law
governing that Security Document and (if requested by
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the Facility Agent or the Security Trustee, acting reasonably) the
jurisdiction of the principal assets secured by that Security Document.
"SECURITY TRUSTEE" means Industrial and Commercial Bank of China (Asia)
Limited in its capacity as security trustee for the Finance Parties.
"SERVICE REVENUE" means the US GAAP calculation for Total Revenue,
including US GAAP Service Revenue not previously reported, from
customers of the Borrower Group excluding IRU Cash Revenue or OA&M Cash
Revenue.
"SG&A EXPENSES" means the US GAAP calculation of selling, general and
administrative expenses of the Borrower Group.
"SHARE MORTGAGES" means collectively the ANC Share Mortgage, the EAN
Share Mortgage and each of the mortgages or similar security documents
in agreed form creating Security Interests to be entered into by the
relevant Security Party set out in Schedule 12 Column 1 in favour of
the Security Trustee over, inter alia, shares of the members of the
Group in form and substance satisfactory to the Finance Parties.
"SUBORDINATION DEEDS" means collectively each of the subordination
deeds or similar security documents in agreed form under which the
Borrower and EAN and each of their respective Material Subsidiaries,
inter alia, subordinates its rights in respect of loans or advances
made or to be made by it to members of the Borrower Group or as the
case may be, the EAN Group and, as appropriate, its obligations in
respect of loans or advances made or to be made to it by members of the
Borrower's Group, in each case, to the Indebtedness constituted by this
Agreement in form and substance satisfactory to the Finance Parties.
"SUBSIDIARY" of a person means any company or entity directly or
indirectly controlled by such person, for which purpose "control" means
either ownership of more than 50% of the voting share capital (or
equivalent right of ownership) of such company or entity or power to
direct its policies and management whether by contract or otherwise.
"SUPPLEMENTAL AMENDMENT AND RESTATEMENT DEED" means the deed dated
27 July, 2004 amending and restating the Original Facility Agreement
entered into by the Borrower, the Original Lenders, the Arrangers,
China Everbright Bank and the Facility Agent.
"SWITCH" means an electronic device connecting a telecommunication
signal from one end-user to another end-user.
"TAXES" includes all present and future taxes, levies, imposts, duties,
fees or charges of whatever nature together with interest thereon and
penalties in respect thereof and "TAXATION" shall be construed
accordingly.
"TAX CREDIT" means a credit against, relief or remission for, or
repayment of any Tax.
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"TAX ON OVERALL NET INCOME" of a person shall be construed as a
reference to a Tax imposed on that person by the jurisdiction in which
its principal office (and/or, in the case of a Lender, its Facility
Office) is located by reference to (a) the net income, profits or gains
received or receivable (but not any sum deemed to be received or
receivable) of that person worldwide or (b) such of its net income,
profits or gains received or receivable (but not any sum deemed to be
received or receivable) as arise in or relate to that jurisdiction.
"TAX PAYMENT" means either an increase in a payment made by the
Borrower or any other Security Party under Clause 14.1 (Tax Gross-up)
or a payment under Clause 14.2 (Tax Indemnity).
"TELECOMMUNICATIONS PROVIDER" means a provider of telecommunications
with a credit rating of "BB-" or above (as determined by Standard &
Poor's International Ratings, or, if not rated by Standard & Poor's,
the equivalent credit rating as determined by Moody's).
"THIRD PARTY IRU" means an agreement or arrangement by which a member
of the Borrower Group agrees to purchase IRUs of a Third Party IRU
Capacity Provider.
"THIRD PARTY IRU AGREEMENT" means an agreement between a member of the
Borrower Group and a Third Party IRU Capacity Provider to purchase IRUs
from that Third Party IRU Capacity Provider.
"THIRD PARTY IRU CAPACITY PROVIDER" means a third party provider of
capacity who is not a member of the Borrower Group.
"TOTAL CAPITAL EXPENDITURE" means in relation to a stated period, the
total aggregate expenditure by the Borrower Group on items of a capital
nature but excluding:
(i) payments of interest and principal in relation to the Vendor
Financing;
(ii) Backhaul/Offnet Overhang; and
(iii) CPE.
"TOTAL CASH AVAILABLE FOR DEBT SERVICE" means in relation to a stated
period the Currency Equivalent of the sum of the amounts referred to on
each Financial Covenant Test Date as Free Cash in the Borrower Group's
latest audited consolidated financial statements or, as the case may
be, its unaudited consolidated financial statements.
"TOTAL COMMITMENTS" means the aggregate of the Total Tranche A
Commitments and the Total Tranche B Commitments, being, subject to
Clause 24 and Clause 25, in aggregate US$130,000,000 at the date of
this Agreement.
"TOTAL EXPENSES" means, in relation to a stated period, the aggregate
for that period of:-
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(i) SG&A Expenses;
(ii) OA&M Expenses; and
(iii) CoA Expenses.
"TOTAL REVENUE" means, in relation to a stated period, the aggregate
for that period of:-
(i) IRU Cash Revenue;
(ii) OA & M Cash Revenue; and
(iii) Service Revenue.
"TOTAL TRANCHE A COMMITMENTS" means the aggregate of the Tranche A
Commitments, being, subject to Clause 24 and Clause 25,
US$73,666,666.67 at the date of this Agreement.
"TOTAL TRANCHE B COMMITMENTS" means the aggregate of the Tranche B
Commitments, being, subject to Clause 24 and Clause 25,
US$56,333,333.33 at the date of this Agreement.
"TRANCHE A" means the facility referred in Clause 2.1(a) (The
Facility).
"TRANCHE A ADVANCE" means an advance made or to be made by the Lenders
to the Borrower under Tranche A or, as the case may be, the principal
amount outstanding for the time being of any such advance.
"TRANCHE A COMMITMENT" means:
(a) in relation to an Original Lender, the amount set opposite its
name under the heading "Tranche A Commitment" in Schedule 1
(The Lenders and their Commitments) and the amount of any
other Tranche A Commitment transferred to it under this
Agreement; and
(b) in relation to any other Lender, the amount of any Tranche A
Commitment transferred to it under this Agreement,
to the extent not cancelled, reduced or transferred by it under this
Agreement.
"TRANCHE A LOAN" means at any time, the aggregate amount of all
Advances outstanding under Tranche A at that time.
"TRANCHE B" means the facility referred in Clause 2.1(b) (The
Facility).
"TRANCHE B ADVANCE" means an advance made or to be made by the Lenders
to the Borrower under Tranche B or, as the case may be, the principal
amount outstanding for the time being of any such advance.
"TRANCHE B COMMITMENT" means:
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(a) in relation to an Original Lender, the amount set opposite its
name under the heading "Tranche B Commitment" in Schedule 1
(The Lenders and their Commitment) and the amount of any other
Tranche B Commitment transferred to it under this Agreement;
and
(b) in relation to any other Lender, the amount of any Tranche B
Commitment transferred to it under this Agreement,
to the extent not cancelled, reduced or transferred by it under this
Agreement.
"TRANCHE B LOAN" means at any time, the aggregate amount of all
Advances outstanding under Tranche B at that time.
"TRANSFER CERTIFICATE" means a certificate substantially in the form
set out in Schedule 5.
"US GAAP" means generally accepted accounting principles applicable in
the United States of America in effect from time to time.
"US GAAP CASH" means the Currency Equivalent of the sum of the amounts
referred to as cash in hand and credit bank balance in the Borrower
Group's latest audited consolidated financial statements or, as the
case may be, its unaudited consolidated financial statements.
"US GAAP RESTRICTED CASH" means the sum of the amounts of cash
deposited by any one or more members of the Borrower Group and used as
collateral for a guarantee issued by a financial institution at the
request of any one or more members of the Borrower Group in the
ordinary course of business.
"UNPAID SUM" means any sum due and payable but unpaid by a Security
Party under the Finance Documents.
"VENDORS" means NEC and KDDI.
"VENDOR FINANCING" means the secured financings made available to,
inter alia, EAN by the Vendors brief details of which are set out in
Schedule 6.
"VENDOR FINANCING INTERCREDITOR DOCUMENTS" means the collateral agency
agreement dated 14th May 2002 between Asia Global Crossing Limited,
EAN, the Collateral Agent (as defined therein), NEC and KDDI and the
intercreditor agreement dated 14th May 2002 between Asia Global
Crossing Limited EAN, the Collateral Agent (as defined therein), NEC
and KDDI.
"VENDOR FINANCING SECURED PARTIES" means KDDI, NEC and the Vendor
Security Trustees as the beneficiaries of the Vendor Financing Security
Documents.
"VENDOR FINANCING SECURITY DOCUMENTS" means together, the NEC PDA and
the KDDI PDA (each as defined in Schedule 6), the agreements
constituting or evidencing the Security Interests granted as security
for the Vendor Financing in
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favour of KDDI and NEC or the Vendor Security Trustee or any of them,
and the Vendor Financing Intercreditor Documents.
"VENDOR FINANCING TRANSFER DOCUMENTS" means collectively the NEC Deed
of Transfer, Release and Settlement, the KDDI Deed of Transfer, Release
and Settlement and each of the agreements and documents listed in the
respective Schedules thereto or required under any such agreement or
document.
"VENDOR SECURITY TRUSTEES" means together, DB Trustees (Hong Kong)
Limited and Fubon Commercial Bank Co., Ltd., and each a "VENDOR
SECURITY TRUSTEE".
"VOICE USAGE" means the transmission and delivery of voice traffic for
other telecommunications carriers.
1.2 CLAUSE HEADINGS
Clause headings and the table of contents are inserted for convenience
of reference only and shall be ignored in the interpretation of this
Agreement.
1.3 CONSTRUCTION
In this Agreement, unless the context otherwise requires:-
(a) references to an "AFFILIATE" means, with respect to any
specified person, any other person that directly, or
indirectly through one or more intermediaries, is controlled
by, controls, or is under common control with, such specified
person;
(b) references to a document being in "AGREED FORM" or to a matter
being "AGREED" means such document or matter as agreed by the
Facility Agent;
(c) references to "ASSETS" include present and future properties,
revenues and rights of every description (whether real,
personal or mixed, and whether tangible or intangible);
(d) references to an "AUTHORISATION" includes any authorisation,
consent, approval, resolution, licence, exemption, filing,
notarisation, lodgement or registration;
(e) references to "CONTROL" of a person means the possession,
directly or indirectly, of the power to direct or cause the
direction of the management and policies of a person and the
investment in such person, whether through the ownership of
share capital or voting securities, as trustee or executor, by
contract or otherwise, including, without limitation, the
ownership, directly or indirectly, of share capital or
securities having the power to elect and/or remove a majority
of the board of directors or similar body governing the
affairs of such person; and "CONTROLLED" shall be construed
accordingly;
[Facility Agreement]
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(f) references to "DISPOSAL" includes any sale, transfer, grant,
assignment, lease, exchange or other disposal, whether
voluntary or involuntary, and "DISPOSE" shall be construed
accordingly;
(g) a reference to "GUARANTEE" includes any other obligation
(whatever called) of any person to pay, purchase, provide
funds (whether by way of the advance of money, the purchase of
or subscription for shares or other securities, the purchase
of assets or services, or otherwise) for the payment of, or
otherwise indemnify against the consequences of default in the
payment of, or otherwise be responsible for, any indebtedness
of any other person;
(h) "MONTH" shall be construed as 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 (and any
reference to "MONTHS" shall be construed accordingly) save
that, where any such period would otherwise end on a day which
is not a Business Day, it shall end on the next Business Day
(or, if that Business Day falls in the following month, on the
immediately preceding Business Day), PROVIDED THAT if a period
starts on the last Business Day in a calendar month or if
there is no numerically corresponding day in the month in
which that period ends, that period shall end on the last
Business Day in that later month;
(i) references to a "PERSON" include references to an individual,
firm, company, corporation, unincorporated body of persons or
any state or any agency thereof;
(j) references to a "REGULATION" includes any regulation, rule,
official directive, request or guideline (whether or not
having the force of law) of any governmental,
intergovernmental or supranational body, agency, department or
regulatory, self-regulatory or other authority or
organisation;
(k) references to "SHARE CAPITAL" includes in respect of any
person, any subscriptions, options, warrants, commitments,
pre-emptive rights or agreements of any kind (including any
shareholders' or voting trust agreements) for the issuance,
sale, registration or voting of, or securities convertible
into, any additional shares of share capital of any class, or
partnership or other ownership interests of any type in, that
person and references to "CLASS" means a class of common
shares, preferred shares, loan stock or equivalent instruments
of a company, whenever issued and, for the avoidance of doubt,
each series of ordinary shares, preferred shares, loan stock
or equivalent instruments in a company, whenever issued and
whether or not having different features, shall be considered
as a separate class;
(l) references to "INCLUDE", "INCLUDES" and "INCLUDING" shall be
construed without limitation;
(m) references to Clauses, Schedules and Recitals include
references to the clauses of, schedules and recitals to, this
Agreement and references to this Agreement include its
Schedules;
[Facility Agreement]
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(n) references in a Clause to a Sub-Clause include references to a
sub-clause of that Clause;
(o) references to (or to any specified provision of) this
Agreement or any other Finance Document or other document
include references to this Agreement, that Finance Document,
that provision or that document as in force for the time being
and as amended, varied, novated or supplemented in accordance
with the terms thereof;
(p) words importing the plural include the singular and vice
versa;
(q) references to an "ADDITIONAL SECURITY PARTY", the "BORROWER",
the "FACILITY AGENT", an "ORIGINAL LENDER", any "FINANCE
PARTY" any "OBLIGOR", any "SECURITY PARTY", any "FINANCE
PARTY" the "SECURITY TRUSTEE" or any "LENDER" where the
context permits, include their respective successors and
permitted transferees and permitted assigns in accordance with
their respective interests;
(r) a Default (other than an Event of Default) is "CONTINUING" if
it has not been remedied or waived and an Event of Default is
"CONTINUING" if it has not been waived.
2. THE FACILITY
2.1 THE FACILITY
Subject to the terms and conditions of this Agreement, the Lenders
hereby agree to make available to the Borrower, the Facility in two
tranches:-
(a) Tranche A of up to an aggregate amount equal to the Total
Tranche A Commitments; and
(b) Tranche B of up to an aggregate amount equal to the Total
Tranche B Commitments.
2.2 PRO RATA PARTICIPATION
(a) Subject to the remaining provisions of this Clause 2 each
Lender shall participate in each Advance to be made under the
Facility in the proportion borne by its Commitment to the
Total Commitments (the "AGREED PROPORTIONS").
(b) Each Lender shall participate in the first Advance made under
Tranche A as follows:
LENDER AMOUNT OF TRANCHE A FIRST ADVANCE
--------------------------------------------------------------------------------------
ICBC Beijing Branch 13,500,000.00
ICBC Shanghai Branch 9,000,000.00
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ICBC Hong Kong Branch 4,500,000.00
China Minsheng Banking Corp. Ltd. 0.00
CITIC Industrial Bank 3,333,333.33
Bank of Communications 1,666,666.67
Huaxia Bank 1,666,666.67
TOTAL 33,666,666.67
(c) For each subsequent Tranche A Advance, each Lender shall
participate in that Tranche A Advance in such amounts
determined by the Facility Agent (acting reasonably) as will
as quickly as possible, result in each Lender's proportion of
the Tranche A Advances being in the Agreed Proportions and
thereafter, each Lender shall participate in any Tranche A
Advance in accordance with Clause 2.2 (a) above PROVIDED THAT
no Lender shall be obliged to participate for more than its
Tranche A Commitment.
2.3 RIGHTS AND OBLIGATIONS OF EACH LENDER SEVERAL
(a) Subject as otherwise expressly provided in this Agreement, the
obligations of each Finance Party under the Finance Documents
are several and failure of a Finance Party to carry out its
obligations does not affect the obligations of any other party
under any of the Finance Documents nor shall any other party
to the Finance Documents be responsible or liable for the
obligations of such Finance Party under the Finance Documents.
(b) The rights of each Finance Party under or in connection with a
Finance Document are separate and independent rights and any
debt arising under a Finance Document to a Finance Party from
a Security Party shall be a separate and independent debt.
(c) Each Finance Party to this Agreement shall except as otherwise
stated in the Finance Documents, be entitled to protect and
enforce its rights arising out of the Finance Documents
independently.
3. PURPOSE
(a) Tranche A shall be used towards financing Approved Capital
Expenditure and part towards the on-lending of funds to NewCo
to purchase the indebtedness and Security Interests
constituted by the Vendor Financing and, subject to prior
written consent from the Facility Agent acting on the
instructions of the Majority Lenders, the repayment of
Existing Shareholder Loans; and
[Facility Agreement]
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(b) Tranche B shall be used solely towards the on-lending of funds
to NewCo to purchase the indebtedness and Security Interests
constituted by the Vendor Financing subject always to Clause
24 (Agreement to Permit Additional Lenders) and Clause 25
(Agreement to Permit Lender to Increase its Commitment),
but no Finance Party shall be obliged to monitor or verify the
application of the proceeds by the Borrower.
4. DRAWDOWN
4.1 DRAWDOWN
Subject to Clause 5 (Conditions Precedent), each Advance in respect of
a Facility shall only be made by the Lenders through the Facility Agent
to the Borrower on each Drawdown Date if the following conditions are
fulfilled:-
(a) not later than 11:00 a.m. (Hong Kong time) on the second
Business Day before the proposed Drawdown Date of the relevant
Advance, the Facility Agent has received from the Borrower a
Drawdown Notice which shall be irrevocable and shall oblige
the Borrower to borrow such Advance on the Drawdown Date as
stated in that Drawdown Notice upon the terms and conditions
of this Agreement;
(b) the proposed Drawdown Date of that Advance is a Business Day
falling within the Drawdown Period;
(c) the proposed Drawdown Date of that Advance is not less than 4
Business Days after the date upon which the previous Advance
(if any) was made under this Agreement; and
(d) the proposed amount of that Advance is either (i) an amount of
not less than US$1,000,000 or if greater an integral multiple
of US$100,000 which is less than the amount of the aggregate
Available Commitments in respect of that Facility or (ii)
equal to the amount of the aggregate Available Commitments in
respect of that Facility on the proposed Drawdown Date for
that Advance.
4.2 NOTIFICATION OF DRAWDOWN NOTICE AND LENDERS' PARTICIPATIONS
Upon receipt of a Drawdown Notice complying with the terms of this
Agreement in respect of an Advance, the Facility Agent shall promptly
notify each Lender of the proposed Drawdown Date and the amount of each
Lender's proportion of that Advance and subject to the terms of this
Agreement, each of the Lenders shall make available to the Facility
Agent on such Drawdown Date its proportion of that Advance.
4.3 PAYMENT OF PROCEEDS
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All amounts to be made available by the Lenders to the Facility Agent
shall be made available not later than 11:00 a.m. (New York time) on
the relevant due date in Dollars in immediately available freely
transferable cleared funds to the account of the Facility Agent as
specified by the Facility Agent for this purpose from time to time.
4.4 REDUCTION OF ADVANCE
If a Lender's Available Commitment is reduced in accordance with the
terms of this Agreement after the Facility Agent has received a
Drawdown Notice for an Advance then the amount of that Advance shall be
reduced accordingly.
4.5 CANCELLATION AFTER DRAWDOWN PERIOD
Any part of the Facility which remains undrawn or uncancelled by the
end of the Drawdown Period shall at that time be automatically
cancelled and the Available Commitment of each Lender shall at that
time be reduced to zero.
5. CONDITIONS PRECEDENT
5.1 DOCUMENTARY CONDITIONS PRECEDENT
Subject to Clause 5.3 (Waiver or Deferral of Conditions), unless all
the Finance Parties otherwise agree in writing with the Borrower, the
Borrower may not deliver a Drawdown Notice for the first Advance until
the Facility Agent, or its duly authorised representative, shall have
confirmed to the Borrower and the Lenders that it has received the
documents and evidence specified in Schedule 3, each in form and
substance satisfactory to the Facility Agent.
5.2 FURTHER CONDITIONS
The obligation of each Lender to contribute to any Advance is subject
to the further conditions that at the time of the making of that
Advance:-
(i) no event mentioned in Clause 9.1 (Market Disruption) occurs or
has occurred in relation to that Advance or any other Advance
or the Loan;
(ii) the representations and warranties in Clause 15
(Representations and Warranties) are true and correct in all
material respects (in the Facility Agent's sole opinion) as if
made on and as of the time of the making of that Advance by
reference to the facts and circumstances existing at such
time;
(iii) no Default is continuing, or will occur as a result of making
that Advance; and
(iv) not later than 11:00 a.m. (Hong Kong time) on the proposed
Drawdown Date of that Advance, the Facility Agent has received
and found satisfactory such additional information, legal
opinions and/or other documents (if any) relevant in the
context of or relating to the Finance Documents and the
Borrower or the
[Facility Agreement]
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transactions contemplated hereby as the Facility Agent may
reasonably request as a result of circumstances which have
arisen or come to its attention since the signing of this
Agreement.
5.3 WAIVER OR DEFERRAL OF CONDITIONS
If all the conditions set out in Clauses 5.1 (Documentary Conditions
Precedent) have not, in the sole opinion of each Finance Party, been
satisfied in full, the Borrower may within 3 months from the date of
this Agreement request all the Lenders (who shall not be obliged to do
so and shall each have an absolute discretion whether or not to do so
and in any event only if all agree to do so) to make one or more
Advances in an aggregate amount not to exceed US$90,000,000 subject to
the following conditions:-
(a) if any of the conditions specified in Clause 5.1 (Documentary
Conditions Precedent) is waived or deferred by the Facility
Agent (acting in accordance with the instructions of all the
other Finance Parties), prior to such an Advance being made,
the Facility Agent shall (if so requested by all the other
Finance Parties) attach to such waiver or deferral such
requirements and further or other conditions as it thinks fit
in relation to that waiver or deferral, and the Obligors shall
and undertake to fulfil, or procure fulfilment of, all such
requirements or further or other conditions as may be notified
to the Obligors by the Facility Agent (acting in accordance
with the instructions of all the other Finance Parties) in
writing, in accordance with the terms of such notification;
and
(b) if the Facility Agent agrees (in accordance with the
instructions of all the other Finance Parties) to permit an
Advance on terms (express or otherwise) that any condition
specified in Clause 5.1 (Documentary Conditions Precedent) may
be fulfilled after the First Drawdown Date, the Obligors shall
(unless the Facility Agent (acting in accordance with the
instructions of all the other Finance Parties) shall have
expressly agreed otherwise in writing with the Obligors)
procure that such condition is fulfilled within 3 months after
the First Drawdown Date (or such other period as the Obligors
and the Facility Agent (acting in accordance with the
instructions of all the other Finance Parties) may agree
having regard to the nature of such condition to be fulfilled)
failing which it shall be an Event of Default.
6. REPAYMENT
6.1 REPAYMENT
The Borrower shall repay each of the Tranche A Loan and Tranche B Loan
in instalments by repaying on each Repayment Date the amount set out
under the column "Repayment Amount" in the table below adjacent to such
Repayment Date in the manner set out below:-
[Facility Agreement]
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INSTALMENT NO. REPAYMENT DATE REPAYMENT AMOUNT
Instalment 1 36 months after the earlier of (i) Equal to 7.5% of the amount of each
First Drawdown Date and (ii) 31 of the Tranche A Loan and the
July ▇▇▇▇ ▇▇▇▇▇▇▇ ▇ Loan outstanding as at
the end of the Drawdown Period
Instalment 2 39 months after the earlier of (i) Equal to 7.5% of the amount of each
First Drawdown Date and (ii) 31 of the Tranche A Loan and the
July ▇▇▇▇ ▇▇▇▇▇▇▇ ▇ Loan outstanding as at
the end of the Drawdown Period
Instalment 3 42 months after the earlier of (i) Equal to 10% of the amount of each
First Drawdown Date and (ii) 31 of the Tranche A Loan and the
July ▇▇▇▇ ▇▇▇▇▇▇▇ ▇ Loan outstanding as at
the end of the Drawdown Period
Instalment 4 45 months after the earlier of (i) Equal to 10% of the amount of each
First Drawdown Date and (ii) 31 of the Tranche A Loan and the
July ▇▇▇▇ ▇▇▇▇▇▇▇ ▇ Loan outstanding as at
the end of the Drawdown Period
Instalment 5 48 months after the earlier of (i) Equal to 10% of the amount of each
First Drawdown Date and (ii) 31 of the Tranche A Loan and the
July ▇▇▇▇ ▇▇▇▇▇▇▇ ▇ Loan outstanding as at
the end of the Drawdown Period
Instalment 6 51 months after the earlier of (i) Equal to 10% of the amount of each
First Drawdown Date and (ii) 31 of the Tranche A Loan and the
July ▇▇▇▇ ▇▇▇▇▇▇▇ ▇ Loan outstanding as at
the end of the Drawdown Period
Instalment 7 54 months after the earlier of (i) Equal to 10% of the amount of each
First Drawdown Date and (ii) 31 of the Tranche A Loan and the
July ▇▇▇▇ ▇▇▇▇▇▇▇ ▇ Loan then outstanding as
at the end of the Drawdown Period
Instalment 8 57 months after the earlier of (i) Equal to 10% of the amount of each
First Drawdown Date and (ii) the of the Tranche A Loan and the
31 July ▇▇▇▇ ▇▇▇▇▇▇▇ ▇ Loan outstanding as at
the end of the Drawdown Period
[Facility Agreement]
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Instalment 9 Final Maturity Date Outstanding balance of each of the
Tranche A Loan and the Tranche B
Loan outstanding as at the end of
the Drawdown Period
6.2 REPAYMENTS OR PREPAYMENTS PRIOR TO PARTICIPATIONS IN THE AGREED
PROPORTIONS
If after the First Drawdown Date but before the participation of each
Lender in the Tranche A Advances has reached that Lender's Agreed
Proportion, a repayment is made under Clause 6.1 or a prepayment is
made under Clause 7.1, the Facility Agent shall apply the amount
received as between the two Loans in the proportions that the amounts
then actually outstanding in respect of each Loan bears to the
aggregate amount then actually outstanding in respect of both Loans and
then as between the Lenders under a Loan, in the proportions that their
actual participation in that Loan outstanding immediately prior to that
date bears to the aggregate sum of the Tranche A Loan and the Tranche B
Loan outstanding immediately before the repayment or prepayment, as the
case may be.
7. VOLUNTARY PREPAYMENT, CANCELLATION AND MANDATORY PREPAYMENT
7.1 VOLUNTARY PREPAYMENT
The Borrower may, at any time after the Drawdown Period, prepay without
premium or penalty (subject to Clause 12 (Indemnities)) all or any part
of any Advance or the Loan on an Interest Payment Date applicable to
the amount to be prepaid, provided that:-
(a) the Borrower shall have given to the Facility Agent not less
than 14 Business Days' prior written notice of the amount and
proposed date of prepayment; and
(b) the amount of any partial prepayment shall be not less than
US$20,000,000 and an integral multiple of US$10,000,000 or the
remaining balance of the Loan; and
(c) subject to the provisions of Clause 6.2 and Clause 13.4 the
amount of any prepayment shall be applied to reduce the
Tranche A Loan and the Tranche B Loan pro rata and in inverse
order of maturity.
No amount prepaid may subsequently be reborrowed.
7.2 ADDITIONAL AMOUNTS ON PREPAYMENT
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Any prepayment under this Agreement shall be made together with accrued
interest thereon, any Breakage Costs and all other sums then due and
payable under the Finance Documents.
7.3 CANCELLATION OF AVAILABLE COMMITMENTS
The Borrower may within the Drawdown Period, by giving to the Facility
Agent not less than 14 Business Days' prior written notice specifying
the amount to be cancelled, cancel without premium or penalty all or
any part (but, if in part, being an amount of not less than
US$20,000,000 and an integral multiple of US$10,000,000) of the Total
Commitments under an Available Facility. Any cancellation in part shall
reduce the Available Commitment of each Lender under that Facility
rateably, and any amount cancelled may not be reinstated.
7.4 IRREVOCABILITY
Any notice of prepayment or cancellation given by the Borrower under
this Agreement shall be irrevocable and shall specify the date upon
which such prepayment or cancellation is to be made and the amount of
such prepayment or cancellation and shall oblige the Borrower to make
such prepayment or cancellation on such date.
7.5 MANDATORY PREPAYMENT
A. Without prejudice to the Borrower's obligations under Clause 6
(Repayment), but subject to Clause 7.5B (Provisions applicable to
Mandatory Prepayments), the Borrower shall, in the circumstances and
manner described below make a Mandatory Prepayment.
(a) ASSET DISPOSALS: Without prejudice to Clause 16.16(c) (Further
Undertakings) and without limiting the obligation of any
member of the Borrower Group to obtain the consent of the
Facility Agent pursuant to Clause 16.20 (Notification and
Consent), the Borrower shall, not later than 5 Business Days
prior to the occurrence of a Disposition or, as the case may
be, the anticipated occurrence of the circumstances listed in
Clause 7.5A.(a)(ii) below notify the Facility Agent in
writing, and, in the case of a Disposition, deliver to the
Facility Agent a statement certified by an Approved Officer of
the Borrower, in form and detail satisfactory to the Facility
Agent, of the amount of the expected Disposition Proceeds and
upon completion of the Disposition or occurrence of the
circumstances listed in Clause 7.5A.(a)(ii) below, as the case
may be, the Borrower shall ensure that any Disposition
Proceeds or amounts referred to in Clause 7.5A(a)(ii) below as
the case may be are paid into the Prepayment Escrow Account
for the purpose of making a Mandatory Prepayment in accordance
with Clause 7.5B in an amount equal to:
(i) the Disposition Proceeds of each Disposition of any
asset occurring outside the ordinary course of its
business whether in a single transaction or a series
of transactions where the receivable proceeds of such
Dispositions in any Financial Year of the Borrower
are in
[Facility Agreement]
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aggregate in excess of US$250,000 and such proceeds
are not reinvested in the business of the Borrower
Group with the prior approval of the Facility Agent
within 180 days of such Disposition, less, an amount,
calculated by the Borrower to the reasonable
satisfaction of the Facility Agent, equal to the
aggregate of (x) agreed costs of such member of the
Borrower Group directly attributable to the
Disposition and (y) reasonable provision for Taxes
directly attributable to the Disposition; and
(ii) the IRU Cash Revenue whether in a single transaction
or a series of transactions by any member of the
Borrower Group where such IRU Cash Revenue is in
aggregate in excess of US$80,000,000 ( excluding OA &
M Cash Revenue) in any Financial Year commencing
after 1 April 2004,
PROVIDED THAT pending any reinvestment of such proceeds as
referred to in paragraph (i) above the Borrower shall ensure
that such Disposition Proceeds shall be paid into the
Disposition Proceeds Escrow Account and no part of any
Disposition Proceeds paid into the Disposition Proceeds Escrow
Account shall be withdrawn except either to apply the same in
such reinvestment or at the end of the 180 days periods to be
transferred to the Prepayment Escrow Account.
(b) IPO: Upon the receipt of any IPO Net Proceeds, the Borrower
shall notify the Facility Agent by giving it notice in the
form of Schedule 9 and shall:
(i) immediately after their receipt pay into the
Prepayment Escrow Account an amount equal to 50% of
such IPO Net Proceeds (unless a lesser amount is
required to fully pay off all amounts outstanding
under the Finance Documents) for the purpose of
making a Mandatory Prepayment in accordance with
Clause 7.5B; and
(ii) procure that the balance of such IPO Net Proceeds are
reinvested in the business of the Borrower and/or any
member of the Borrower Group.
(c) INSURANCE PROCEEDS: The Borrower shall or shall procure that
any Insurance Proceeds received by (i) the Borrower or any
member of the Borrower Group; or (ii) AssetCo or any member of
the AssetCo Group; or (iii) the relevant loss payee, as the
case maybe, in excess of US$1,000,000 (or its Currency
Equivalent) in respect of any single incident (less any
compensation and/or claim due to be paid out in settlement of
claims in respect of third party liability in respect of such
incident) are paid as soon as reasonably practicable to the
Prepayment Escrow Account for the purposes of making a
Mandatory Prepayment in accordance with Clause 7.5B UNLESS:
(i) within 30 days of such incident the Borrower or
AssetCo provides the Facility Agent with a
reinstatement plan for the repair or replacement of
the damaged asset to restore such damaged assets to a
state and level
[Facility Agreement]
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of performance substantially similar to the state and
level of performance immediately prior to the
incident (the "REINSTATEMENT PLAN"); and
(ii) within 240 days after the Reinstatement Plan is
submitted to the Facility Agent, the damaged asset
the subject of such incident has been restored to its
state and level of performance immediately prior to
the incident to the reasonable satisfaction of the
Facility Agent,
PROVIDED THAT pending the satisfaction of the conditions in
paragraphs (i) and (ii) above the Borrower shall ensure that
such Insurance Proceeds shall be paid into the Insurance
Proceeds Escrow Account and no part of any Insurance Proceeds
paid into the Insurance Proceeds Escrow Account shall be
withdrawn except for the purpose described in Clause
7.5A(c)(ii) within that 240 days period or at the end of such
240 days period to be transferred to the Prepayment Escrow
Account.
(d) REQUISITION PROCEEDS: Upon the receipt by any member of the
Borrower Group of any Requisition Proceeds, the Borrower shall
or shall procure that such member of the Borrower Group pays
such Requisition Proceeds into the Prepayment Escrow Account
for the purposes of making a Mandatory Prepayment in
accordance with Clause 7.5B in an amount equal to the amount
of Requisition Proceeds received, but excluding Requisition
Proceeds which:
(i) relate to assets/facilities of the Borrower essential
for the continued operation of the Borrower Group's
core business which are applied to replace assets
and/or establish alternative facilities similar or
comparable to the assets and/or facilities in respect
of which Requisition Proceeds were received; or
(ii) which do not fall within paragraph (i) above but
which the Facility Agent acting on the instructions
of the Majority Lenders has agreed (such agreement
not to be unreasonably withheld or delayed) may be
applied to replace assets and/or establish
alternative facilities similar or comparable to the
assets and/or facilities in respect of which the
Requisition Proceeds were received.
PROVIDED THAT in the case of any Requisition Proceeds falling
within the terms of Clause 7.5A(d)(i) or (ii) above, the
Borrower shall ensure that such Requisition Proceeds shall be
paid into the Requisition Proceeds Escrow Account.
(e) NEW INDEBTEDNESS: Upon any member of the Borrower Group
raising any Indebtedness from time to time which is not
Permitted Indebtedness ("NEW INDEBTEDNESS PROCEEDS"), the
Borrower shall or shall procure that simultaneously therewith
an amount equal to the amount of such New Indebtedness
Proceeds is immediately paid into the Prepayment Escrow
Account for the purpose of making a Mandatory Prepayment in
accordance with Clause 7.5B.
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Nothing in this Clause 7.5A (Mandatory Prepayment) shall be deemed to
limit any obligation of any member of the Borrower Group or the AssetCo
Group (as the case may be) pursuant to the other provisions of this
Clause 7.5 or any of the other Finance Documents to remit any of the
Insurance Proceeds, the Requisition Proceeds, the IPO Net Proceeds, the
New Indebtedness Proceeds or the Disposition Proceeds to the Prepayment
Escrow Account maintained by the Borrower with the Facility Agent
pursuant to any of the Finance Documents.
B. Within 5 Business Days after the date on which any Disposition
Proceeds, IPO Net Proceeds, Insurance Proceeds, Requisition Proceeds,
New Indebtedness Proceeds or any other monies payable pursuant to
Clause 7.5A ("PROCEEDS") have been received, (such dates the "RECEIPT
DATE") the Borrower shall deliver a certificate to the Facility Agent
confirming the relevant Receipt Date, the amount and nature of such
Proceeds and amounts deducted therefrom, and the Borrower shall ensure
that all Proceeds are paid directly upon receipt into the Prepayment
Escrow Account or, as the case may be, the other relevant Escrow
Account and shall upon receipt into the Prepayment Escrow Account make
a Mandatory Prepayment in an amount equal to such Proceeds and:
(a) any Mandatory Prepayment shall be made together with accrued
interest thereon, any Breakage Costs and all other sums then
due and payable under the Finance Documents;
(b) each Mandatory Prepayment shall be applied to reduce the
Tranche A Loan and the Tranche B Loan pro rata and in inverse
order of maturity.
Where, pursuant to Clause 7.5A and 7.5B (Mandatory Prepayment), the
Borrower is required to procure a prepayment of the Loan on any day
which is not an Interest Payment Date under this Agreement, the
Borrower shall unless such has already been deposited pursuant to the
provisions of Clause 7.5A., deposit into the Prepayment Escrow Account
the amount of the required prepayment, which amount shall (a) be
required to be retained in such Prepayment Escrow Account until the
next Interest Payment Date under this Agreement whereupon the Borrower
will make the required prepayment of the Loan on such relevant Interest
Payment Date by applying the credit balance on such Prepayment Escrow
Account in such prepayment and (b) bear interest for the period of such
deposit (on the basis of a year of 360 days and the actual number of
days elapsed) at the rate per annum conclusively determined by the
Facility Agent to be the rate per annum at which Dollar deposits in an
amount comparable to such credit balance may be deposited by the
Facility Agent for the relevant period of such deposit in London
interbank market.
C. If at any time so long as any sum remains payable under the Finance
Documents or any part of a Facility remains available:
(a) (i) China Network ceases to control or to be the Holding
Company of CNC HK or AssetCo; or (ii) any person or groups of
persons acting in concert or acting together gains control or
becomes the Holding Company of CNC HK or AssetCo; or
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(b) prior to the Guarantor IPO Date, any change is made to the
general nature of the business of the CNC HK Group which is
reasonably likely to materially and adversely affect the
business or financial condition of the CNC HK Group as
compared to the financial condition of the CNC HK Group as at
31 December 2003 or the ability of any Security Party to
perform its respective obligations under the Finance
Documents,
then:
(i) the Borrower shall promptly notify the Facility Agent
upon becoming aware of that event; and
(ii) without prejudice to paragraph (i) above, upon the
Facility Agent becoming aware of that event, if the
Lenders so require, the Facility Agent shall by not
less than 14 days notice to the Borrower cancel the
Total Commitments of each Facility and declare all
Outstandings of the Lenders together with accrued
interest thereon, any Breakage Costs and all other
amounts accrued and then due and payable under the
Finance Documents immediately due and payable,
whereupon the Total Commitments of each Facility will
be cancelled and all such outstanding amounts will
immediately become due and payable and the Borrower
shall prepay an amount equal to such outstanding
amounts subject to and in accordance with Clause 7.2
and 7.4.
For the purpose of paragraph 7.5C(a)(ii) above, a person "ACTING IN
CONCERT" with another person has the meaning given to it in the Codes
on Takeovers and Mergers and Share Repurchases published from time to
time by the Securities and Futures Commission of Hong Kong and "ACTING
TOGETHER" means two or more persons acting together for the purposes of
acquiring, holding, voting or disposing of equity securities or share
capital as referred to in the United States Securities and Exchange
Commission Rule 13d-5.
8. INTEREST
8.1 INTEREST RATE
The Borrower shall pay interest in arrears on each Advance or, as the
case may be, the Loan in respect of each Interest Period on each
Interest Payment Date at the annual rate of interest determined by the
Facility Agent to be the aggregate of (i) the Margin and (ii) LIBOR for
that Interest Period.
8.2 INTEREST PERIODS
The Interest Periods applicable to each Advance or, as the case may be,
the Loan shall be of 3 month's duration PROVIDED THAT:-
(a) the first Interest Period in relation to each Advance shall
commence on the Drawdown Date of that Advance;
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(b) each Interest Period (other than the first Interest Period in
relation to each Advance) shall commence on the last day of
the preceding Interest Period;
(c) in relation to each Advance other than the first Advance, the
first Interest Period shall end on the last day of the then
current Interest Period in respect of the Loan so that all
existing Advances shall be consolidated upon the expiry of
each Interest Period (to the extent not already consolidated
in accordance with this Clause 8.2 (Interest Periods));
(d) any Interest Period which would otherwise end on a
non-Business Day shall instead end on the next following
Business Day or, if that Business Day is in another calendar
month, on the immediately preceding Business Day;
(e) if any Interest Period commences on the last Business Day of a
calendar month or on a day for which there is no numerically
corresponding day in the calendar month 3 months thereafter,
as the case may be, that Interest Period shall, subject to
Clause 8.2 (c) and (f) (Interest Periods), end on the last
Business Day of such later calendar month; and
(f) any Interest Period which would otherwise overrun a Repayment
Date or the Final Maturity Date shall instead end on that
Repayment Date or, as the case may be, the Final Maturity
Date, subject to adjustment in accordance with Clause 13.7
(Business Day Convention).
8.3 DAY COUNT CONVENTION
Interest shall accrue from day to day and shall be calculated on the
basis of the actual number of days elapsed and a 360-day year,
including the first day of the period during which it accrues but
excluding the last.
8.4 DEFAULT INTEREST
(a) If a Security Party fails to pay any amount payable by it
under a Finance Document on its due date, (to the extent that
such Finance Document does not contain provisions for the
payment of interest at a default rate) interest shall accrue
on the overdue amount from the due date up to the date of
actual payment (both before and after judgment) at the Default
Rate in the currency of the overdue amount for successive
Interest Periods, each of a duration selected by the Facility
Agent. Any interest accruing under this Clause 8.4 (Default
Interest) shall be immediately payable by the Borrower on
demand by the Facility Agent.
(b) If any overdue amount consists of all or part of a Loan which
became due on a day which was not the last day of an Interest
Period relating to that Loan:
(i) the first Interest Period for that overdue amount
shall have a duration equal to the unexpired portion
of the current Interest Period relating to that Loan;
and
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(ii) the rate of interest applying to the overdue amount
during that first Interest Period shall be the
Default Rate.
(c) Default Interest (if unpaid) arising on an overdue amount will
be compounded with the overdue amount at the end of each
Interest Period applicable to that overdue amount but will
remain immediately due and payable.
8.5 NOTIFICATION OF RATES OF INTEREST
The Facility Agent shall promptly notify the Lenders and the Borrower
of the determination of a rate of interest pursuant to the terms of
this Agreement.
9. SUBSTITUTE BASIS
9.1 MARKET DISRUPTION
If, in relation to an Advance or the Loan for any Interest Period:-
(a) the Facility Agent, acting reasonably determines (which
determination shall be conclusive and binding) that by reason
of circumstances affecting the London interbank market
generally, adequate and fair means do not or will not exist
for ascertaining LIBOR for that Interest Period; or
(b) only one or no Reference Bank notifies the Facility Agent of a
rate for the purpose of determining LIBOR for that Interest
Period; or
(c) the Facility Agent is notified by a group of Lenders to whom
in aggregate fifty per cent. (50%) or more of an Advance or
the Loan is (or if that Advance were then made, would be) owed
that deposits in Dollars in the required amount for the
relevant Interest Period are not available to them in the
London interbank market or that LIBOR does not adequately
reflect the cost to those Lenders of obtaining funds for that
Interest Period,
the Facility Agent shall promptly notify the Borrower and the Lenders
accordingly and no Advance or further Advance, as the case may be,
shall be made until a substitute basis pursuant to this Clause 9
(Substitute Basis) is agreed.
9.2 CONSULTATION AND AGREEMENT
Immediately following the notification referred to in Clause 9.1
(Market Disruption), the Borrower and the Facility Agent, in
consultation with the Lenders, shall negotiate in good faith with a
view to agreeing upon a substitute basis for funding an Advance or the
Loan, as the case may be, and determining the applicable interest rate.
If a substitute basis is agreed in writing within 30 days after such
notification or such longer period for discussion as the Borrower and
the Facility Agent acting on the instructions of the Lenders may agree,
that substitute basis shall take effect in accordance with its terms.
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9.3 NO AGREEMENT
If a substitute basis is not so agreed and an Advance has been made,
the Borrower shall pay interest to each Lender on that Lender's
Outstandings for the relevant Interest Period at the rate per annum
equal to the aggregate of:-
(a) the Margin; and
(b) the rate notified to the Facility Agent to be that which
expresses as a percentage rate per annum the cost to that
Lender of funding its Outstandings during the relevant
Interest Period (from whatever source that Lender may select).
9.4 CANCELLATION OR PREPAYMENT
If a substitute basis is not so agreed pursuant to Clause 9.2
(Consultation and Agreement) and:-
(a) if no Advance has been made, the Facility shall be cancelled
and all sums outstanding under the Finance Documents shall be
paid to the Facility Agent at the end of the period for
negotiation ascertained in accordance with Clause 9.2
(Consultation and Agreement); or
(b) if one or more Advances have been made, the Facility Agent may
require the prepayment of the whole of the Loan, by giving
written notice to the Borrower specifying a prepayment date
which is not less than 30 days after such notice is given. On
such specified date the Facility shall be cancelled and the
Borrower shall prepay (without premium or penalty, other than
any amounts payable pursuant to Clause 12 (Indemnities)) the
Loan in full together with interest accrued thereon to the
date of prepayment and all other sums payable under the
Finance Documents. For this purpose, the interest rate from
time to time applicable to each Lender's Outstandings shall be
the rate as ascertained in accordance with Clause 9.3 (No
Agreement) in relation to the relevant period.
10. INCREASED COSTS
10.1 INCREASED COSTS
If the result of any change in, or the introduction of, any law,
regulation or regulatory requirement or any change in the
interpretation or application thereof or compliance by any Finance
Party or any of its Affiliates with any direction, request or
requirement (whether or not having the force of law) of any central
bank, monetary, regulatory or other authority (including, in each case
without limitation, those relating to Taxation, capital adequacy,
liquidity, reserve assets and special deposits) is to:-
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(a) subject any Finance Party or any of its Affiliates to Taxes or
change the basis of Taxation of any Finance Party or any of
its Affiliates with respect to any payment under the Finance
Documents (other than Taxes or Taxation on the overall net
income or profits of such Finance Party or any such Affiliate
imposed in the jurisdiction in which it is incorporated or in
which its lending office under this Agreement is located);
and/or
(b) increase the cost of, or impose an additional cost on, any
Finance Party or any of its Affiliates in relation to the
making of an Advance or maintaining or funding any Lender's
Available Commitment or Outstandings; and/or
(c) reduce the amount payable or the effective return to any
Finance Party or any of its Affiliates under the Finance
Documents; and/or
(d) reduce any Finance Party's or any of its Affiliates' rate of
return on its overall capital by reason of a change in the
manner in which it is required to allocate capital resources
to its obligations under the Finance Documents; and/or
(e) require any Finance Party or any of its Affiliates to make a
payment or forgo a return on or calculated by reference to any
amount received or receivable by it under or by reason of the
Finance Documents,
then and in each such case:-
(i) such Finance Party shall notify the Borrower through the
Facility Agent in writing of such event promptly upon its
becoming aware of the same; and
(ii) the Borrower shall on demand pay to the Facility Agent for the
account of such Finance Party the amount which such Finance
Party certifies as the amount required to compensate such
Finance Party or its Affiliates for such increased cost,
reduction, payment or forgone return; and
(iii) without prejudice to the obligations of the Borrower under
paragraph (ii) above, so long as the circumstances giving rise
to such increased cost, reduction, payment of foregone return
continue, the Borrower may with respect to a Lender prepay
(without premium or penalty, other than any amounts payable
pursuant to Clause 12 (Indemnities)) all but not part of such
Lender's Outstandings together with accrued interest thereon
to the date of actual payment and all other sums payable
hereunder in relation to such Outstandings or under the
Finance Documents, on giving not less than 30 days' prior
written notice to the Facility Agent. Such Lender's Commitment
shall be cancelled on the giving of such notice.
A demand may be made by a Finance Party under this Clause at any time
whether or not any of the Outstandings has been repaid.
10.2 ALLOCATION
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Each Finance Party may allocate or spread costs and/or losses among its
assets and liabilities (or any class thereof) on such basis as it
reasonably considers appropriate.
10.3 MITIGATION
(a) Each Finance Party agrees that it shall negotiate with the
Borrower with a view to mitigating the circumstances giving
rise to an increased cost set out in Clause 10.1 (Increased
Costs) including without limitation by transferring its rights
and obligations under the Finance Documents to another
Affiliate or Facility Office.
(b) Paragraph (a) above does not in any way limit the obligations
of any Security Party under the Finance Documents.
10.4 LIMITATION OF LIABILITY
(a) The Borrower shall indemnify each Finance Party for all costs
and expenses reasonably incurred by that Finance Party as a
result of steps taken by it under Clause 10.3 (Mitigation).
(b) A Finance Party is not obliged to take any steps under Clause
10.3 (Mitigation) if, in the opinion of that Finance Party
acting reasonably, to do so might be prejudicial to it.
11. ILLEGALITY
If it shall become unlawful or contrary to any law, regulation, treaty
or official directive (whether or not having the force of law), as the
case may be, in any jurisdiction applicable to any Lender for that
Lender to perform any of its obligations as contemplated by this
Agreement or to fund its participation in the Loan, that Lender shall,
by written notice to the Borrower through the Facility Agent, declare
that its obligations shall be terminated on the earlier of (i) the last
day of the then current Interest Period and (ii) the latest date as
such Lender may certify as being permitted by the relevant law,
regulation, treaty or official directive whereupon at the end of the
applicable period the Borrower shall, if so required pursuant to such
law, regulation, treaty or official directive, prepay forthwith
(without premium or penalty, other than any amounts payable pursuant to
Clause 12 (Indemnities)) (or, if permitted by the relevant law,
regulation, treaty or official directive, at the end of the then
current Interest Period) that Lender's Outstandings together with
accrued interest thereon to the date of actual payment and all other
sums payable under the Finance Documents. On the giving of such notice
that Lender's Commitment shall immediately be reduced to zero and its
obligations under this Agreement shall cease.
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12. INDEMNITIES
12.1 GENERAL INDEMNITY
The Borrower shall (and shall procure that a member of the Borrower
Group will), forthwith on demand of the Facility Agent, indemnify each
Finance Party against all costs, losses, expenses and liabilities,
including without limitation Breakage Costs and loss of Margin, which
that Finance Party may properly sustain or incur as a consequence of
all or any of:-
(a) any default in payment on the due date by a Security Party of
any sum due or expressed to be due under any of the Finance
Documents;
(b) the occurrence or continuation of any Default;
(c) any accelerated repayment under Clause 17 (Events of Default);
(d) the operation of Clause 22 (Pro rata Sharing);
(e) any failure to borrow in accordance with any Drawdown Notice,
including any failure in the due satisfaction of any of the
conditions in Clause 5 (Conditions Precedent) or any failure
to prepay any Advance or the Loan or any part thereof in
accordance with a notice of prepayment given in accordance
with this Agreement;
(f) any prepayment of the Loan or any part thereof other than in
accordance with the provisions of Clause 7.1 (Voluntary
Prepayment Cancellation);
(g) any payment of principal or an overdue amount being received
otherwise than on the last day of an Interest Period or on its
due date with respect to such overdue amount; or
(h) any other default by a Security Party with respect to any of
its obligations under any of the Finance Documents to which it
is a party,
provided such costs, losses, expenses and liabilities including without
limitation Breakage Costs and loss of Margin have not arisen due to the
Finance Parties' fraud, wilful misconduct or gross negligence.
12.2 CURRENCY INDEMNITY
(a) If an amount due to the Facility Agent or any Finance Party
from a Security Party under the Finance Documents (a "SUM"),
or any order, judgment or award given or made in relation to a
sum, has to be converted from the currency (the "FIRST
CURRENCY") in which that sum is payable into another currency
(the "SECOND CURRENCY") for the purpose of:
(i) making or filing a claim or proof against that
Security Party;
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(ii) obtaining or enforcing an order, judgment or award in
relation to any litigation or arbitration
proceedings,
the Borrower shall, as an independent obligation to the
Facility Agent or such Finance Party, indemnify the Facility
Agent or such Finance Party to whom that sum is due against
any cost, loss or liability arising out of or as a result of
the conversion including any discrepancy between (A) the rate
of exchange used to convert that sum from the first currency
into the second currency and (B) the rate or rates of exchange
available to that person at the time of its receipt of that
sum.
(b) The Borrower waives any right it may have in any jurisdiction
to pay any amount under the Finance Documents in a currency or
currency unit other than that in which it is expressed to be
payable.
13. PAYMENTS
13.1 PLACE
All payments by the Borrower or a Lender under this Agreement shall be
made to the Facility Agent to its account at such office or bank as it
may notify the Borrower or that Lender from time to time for this
purpose. All payments by the Facility Agent to the Borrower or the
Lenders under this Agreement shall be made to the account at such
office or bank as they may notify the Facility Agent from time to time
for this purpose.
13.2 FUNDS
Payments under this Agreement shall be made for value on the relevant
due date before 11:00 a.m. (New York time) in immediately available
funds to such account as the Facility Agent or the Borrower may specify
or in such other manner as the Facility Agent or the Borrower may
specify as being customary at the time for the settlement of
transactions in Dollars.
13.3 NO SET-OFF AND COUNTERCLAIM
All payments made by a Security Party under the Finance Documents shall
be calculated and made without (and free and clear of any deduction
for) set-off or counterclaim.
13.4 DISTRIBUTION
Except as otherwise indicated in this Agreement, all payments made to
the Facility Agent by the Borrower under this Agreement shall be with
same day value and distributed by the Facility Agent among the Lenders
rateably in accordance with their Commitments and in like funds as they
are received by the Facility Agent, to such account of each Lender as
shall have previously been notified to the Facility Agent.
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13.5 PARTIAL PAYMENTS
If the Facility Agent receives from the Borrower or any other person on
its behalf a payment that is insufficient to discharge all the amounts
then due and payable by the Borrower under the Finance Documents , the
Facility Agent may apply such payment towards the obligations of the
Borrower under the Finance Documents in the following order:-
(a) firstly, in or towards payment, on a pro rata basis, of any
unpaid fees (including, without limitation, the commitment fee
payable under Clause 20.3 (Commitment Fee)), costs and
expenses of the Facility Agent under this Agreement;
(b) secondly, in or towards payment to the Finance Parties, on a
pro rata basis, of any accrued interest, fee or commission
which shall have become due but remains unpaid under the
Finance Documents;
(c) thirdly, in or towards payment to the Lenders, on a pro rata
basis, of any principal which shall have become due but
remains unpaid under the Finance Documents; and
(d) fourthly, in or towards payment of any other sum which shall
have become due but remains unpaid under the Finance
Documents.
The order of application set out in sub-clauses (b) to (d) may be
varied by the Facility Agent if the Finance Parties so direct.
13.6 REFUNDS
Where any sum is to be paid under the Finance Documents to the Facility
Agent for the account of another person, the Facility Agent may assume
that the payment will be made when due and may (but shall not be
obliged to) make such sum available to the person so entitled. If it
proves to be the case that such payment was not made to the Facility
Agent, then the person to whom such sum was so made available shall on
request refund such sum to the Facility Agent together with interest
thereon sufficient to compensate the Facility Agent for the cost of
making available such sum up to the date of such repayment and the
person by whom such sum was payable shall indemnify the Facility Agent
for any and all losses or expenses which the Facility Agent may sustain
or reasonably incur as a consequence of such sum not having been paid
on its due date.
13.7 BUSINESS DAY CONVENTION
(a) Any payment under the Finance Documents which is due to be
made on a day which is not a Business Day shall be made on the
next Business Day in the same calendar month (if there is one)
or the preceding Business Day (if there is not).
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(b) During any extension of the due date for payment of any
principal or any other sum which is due and payable but unpaid
by a Security Party under the Finance Documents, interest is
payable on the principal at the rate payable on the original
due date.
13.8 CONTROL ACCOUNT
Each Lender shall maintain, in accordance with its usual practices, an
account or accounts evidencing the amounts from time to time lent by,
owing to and paid to it under this Agreement. The Facility Agent shall
maintain a control account showing the Advances made, the Loan and
other sums owing by the Borrower under this Agreement and all payments
in respect thereof made by the Borrower from time to time. The control
account shall, in the absence of manifest error, be conclusive as to
the amount from time to time owing by the Borrower under this
Agreement.
13.9 CERTIFICATES
Any certificate or determination of the Facility Agent or any Finance
Party as to any rate of interest or any amount or otherwise under or
for the purposes of this Agreement shall, in the absence of manifest
error, be conclusive and binding on the Borrower and (in the case of a
certificate or determination by the Facility Agent) on the Finance
Parties.
13.10 CURRENCY OF ACCOUNT
(a) Subject to paragraph (b) to (c) below, Dollars is the currency
of account and payment for any sum due.
(b) Each payment in respect of costs, expenses or Taxes shall be
made in the currency in which the costs, expenses or Taxes are
incurred.
(c) Any amount expressed to be payable in a currency other than
Dollars shall be paid in that other currency.
14. TAXES
14.1 TAX GROSS-UP
(a) All sums payable by the Borrower or any other Security Party
under the Finance Documents shall be paid in full without any
restriction or condition and free and clear of any Tax or
other deductions or withholdings of any nature.
(b) If at any time the Borrower or any other Security Party or any
other person is required in any jurisdiction to make any
deduction or withholding in respect of Taxes or otherwise from
any payment due under the Finance Documents for the account of
the Facility Agent or any Finance Party (or the Facility Agent
is required to make any such deduction or withholding from a
payment to any
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Finance Party), the sum due from the Borrower or such other
Security Party in respect of such payment shall be increased
to the extent necessary to ensure that, after the making of
such deduction or withholding, the Facility Agent or each
Finance Party receives on the due date for such payment (and
retains, free from any liability in respect of such deduction
or withholding) a net sum equal to the sum which it would have
received had no such deduction or withholding been required to
be made.
(c) The Borrower's obligations under Clause 14.1(a) and (b) shall
not apply in respect of any Tax on Overall Net Income levied
on a Finance Party.
(d) All Taxes required by law to be deducted or withheld by the
Borrower from any amounts paid or payable under this Agreement
shall be paid by the Borrower when due (except for such
amounts being disputed by the Borrower in good faith) to the
relevant taxing authority.
14.2 TAX INDEMNITY
The Borrower shall indemnify each Finance Party against any losses or
costs incurred by any of them by reason of:
(a) any failure of any Security Party to make any such deduction
or withholding referred to in Clause 14.1; or
(b) any increased payment referred to in Clause 14.1 not being
made on the due date for such payment; or
(c) any Taxes which are being disputed by any Security Party and
remaining unpaid; and
(d) any liability suffered (directly or indirectly) for or on
account of Tax by that Finance Party in respect of any payment
received or receivable or deemed to be received or receivable
under a Finance Document.
14.3 EVIDENCE OF PROOF
Each Security Party shall promptly deliver to the Facility Agent any
receipts, certificates or other proof evidencing the amounts (if any)
paid or payable in respect of any deduction or withholding as
aforesaid.
14.4 TAX CREDIT
If Security Party makes a Tax Payment and the relevant Finance Party
determines that:-
(a) a Tax Credit is attributable either to an increased payment of
which that Tax Payment forms part, or to that Tax Payment; and
(b) that Finance Party has obtained, utilised and retained that
Tax Credit,
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the Finance Party shall, promptly after obtaining the benefit of that
Tax Credit, pay an amount to the Security Party which will leave it
(after that payment) in the same after-Tax position as it would have
been in had the Tax Payment not been required to be made by the
Security Party. Any certificate or determination of a Finance Party
showing in reasonable details the calculations made by that Finance
Party as to any amount for the purposes of this Clause 14 shall, in the
absence of manifest error, be conclusive and binding on the Borrower
and the other Security Parties.
15. REPRESENTATIONS AND WARRANTIES
15.1 REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Facility Agent and each of
the Finance Parties that:
(a) STATUS: each member of the Borrower Group is a company duly
incorporated and validly existing under the laws of its place
of incorporation and has full power, authority and legal right
to own its property and assets and to carry on its business as
such business is now being conducted;
(b) POWER AND AUTHORITY: each member of the Borrower Group has all
legal power and authority to enter into each of the Finance
Documents to which it is or will be a party and perform its
obligations under each of such Finance Documents and all
actions (including any corporate action) required to authorise
the execution and delivery of each of such Finance Documents
and the performance of its obligations under each of the
Finance Documents to which it is or will be a party have been
duly taken;
(c) LEGAL VALIDITY: the Finance Documents to which each member of
the Borrower Group is or will be a party constitute or, when
so executed and delivered, will constitute legal, valid and
binding obligations of the Borrower and each member of the
Borrower Group enforceable in accordance with their respective
terms;
(d) NON-CONFLICT WITH LAWS: the entry into, performance and
delivery of each of the Finance Documents to which it is or
will be a party and the transactions contemplated thereby do
not and will not conflict with or result in a breach of (i)
any law, judgment, regulation or any official or judicial
order, or (ii) the constitutional documents of each member of
the Borrower Group, or (iii) any agreement or document to
which each member of the Borrower Group is a party or which is
binding upon it or any of its assets or revenues with a
monetary value greater than US$500,000, nor cause any
limitation placed on it or the powers of its directors to be
exceeded or result in the creation or imposition of any
Security Interest on any of its assets or revenues pursuant to
the provisions of any such agreement or document;
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(e) NO CONSENTS: other than the Consents, no consent,
authorisation, licence or approval of, or registration with or
declaration to, governmental or public bodies or authorities
or courts is required for or in connection with, the
execution, delivery, validity, enforceability or admissibility
in evidence of the Finance Documents to which it is party or
the performance by each member of the Borrower Group of its
obligations under such Finance Documents;
(f) NO REGISTRATION: it is not necessary in order to ensure the
legality, validity, enforceability or admissibility in
evidence of the Finance Documents that it or any other
instrument be notarised, filed, recorded, registered or
enrolled in any court or other authority or that any stamp,
registration or similar tax or charge be paid on or in
relation to this Agreement and this Agreement is in proper
form for its enforcement in the courts of England, Hong Kong
and all jurisdictions the subject of any legal opinion
referred to in paragraph 4 of Schedule 3;
(g) LITIGATION: except as disclosed in a letter of even date from
the Borrower to the Facility Agent, no litigation, arbitration
or administrative proceeding is currently taking place or
pending or, to the knowledge of the officers of the Borrower,
threatened against the Borrower or any member of the Borrower
Group or any of their respective assets which could, in the
reasonable opinion of the Majority Lenders, materially and
adversely affect its business, assets or financial condition
or their respective ability to perform its obligations under
the Finance Documents to which each is party;
(h) NO TAXES: under the laws of its jurisdiction of incorporation
in force at the date of this Agreement, all payments to be
made by each member of the Borrower Group under the Finance
Documents may be made by the Borrower and each member of the
Borrower Group free and clear of, and without deduction for,
Taxes and no deductions or withholdings are required to be
made therefrom save as specified in any legal opinion referred
to in paragraphs 2, 3 and 4 of Schedule 3; and no Taxes are
imposed on or by virtue of the execution or delivery by each
member of the Borrower Group of the Finance Documents to which
it is party or any document to be executed or delivered under
such Finance Documents;
(i) TAX LIABILITIES: each member of the Borrower Group has
complied with all Taxation laws in all material respects in
all jurisdictions in which they are subject to Taxation and
has paid all Taxes due and payable by each of them; no
material claims are being asserted against them with respect
to Taxes;
(j) NO DEFAULT:
(a) no Default has occurred and is continuing or might
reasonably be expected to result from the making of
an Advance;
(b) no member of the Borrower Group is or, with the
giving of notice or lapse of time or satisfaction of
any other condition or any combination thereof, would
be in material breach of or in default under any
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agreement relating to Financial Indebtedness to which
it is a party or by which it may be bound;
(k) NO IMMUNITY: the Borrower is generally subject to civil and
commercial law and to legal proceedings and neither the
Borrower nor any of its assets or revenues is entitled to any
immunity or privilege (sovereign or otherwise) from any
set-off, judgment, execution, attachment or other legal
process;
(l) INFORMATION: all information supplied to the Facility Agent or
any Lender by or on behalf of the Borrower in respect any
member of the Borrower Group under or in connection with the
Finance Documents is true, complete and accurate in all
material respects and not misleading in any material respect
or does not omit any material facts and all reasonable
enquiries have been made to verify the facts contained in the
Finance Documents; and there are no other facts the omission
of which would make any fact or statement therein misleading
in any material respect;
(m) SECURITY INTEREST: save as permitted by Clause 16.16(a)
(Borrower Negative Pledge), no Security Interest exists over
all or any of the present or future revenues or assets of any
member of the Borrower Group;
(n) NO WINDING-UP: no member of the Borrower Group has taken any
corporate action or no other step has been taken or legal
proceedings have been commenced or threatened against it for
its winding-up, dissolution, administration or reorganisation
or for the appointment of a receiver, administrator, trustee
or similar officer of it or all or any of its assets or
revenues, except as permitted by Clause 17.1(g) (Winding-up);
(o) GROUP STRUCTURE CHART: the Group Structure Chart shows:-
(i) each member of the Group and any person in whose
shares any member of the Group has an interest (and
the percentage of the issued share capital held, and
whether legally or beneficially, by that member), in
each case as at the Effective Date;
(ii) the jurisdiction of incorporation or establishment of
each person shown in it;
(iii) the status of each person shown in it which is not a
limited liability company or corporation;
(p) NO FINANCIAL INDEBTEDNESS: no member of the Borrower Group has
any Financial Indebtedness other than as permitted by Clause
16.17; and
(q) COMPLIANCE WITH CONSENTS AND LICENCES: every consent,
authorisation, licence or approval required for the time being
by each member of the Borrower Group in connection with the
conduct of its business and the ownership, use, exploitation
or occupation of its property and assets has been applied for
and not refused or has been obtained and is in full force and
effect
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and there has been no material default in the observance of
the conditions and restrictions (if any) imposed on, or in
connection with, any of the same which may have a material
adverse effect on the ability of each member of the Borrower
Group to perform its obligations under the Finance Documents
to which it is party and, to the knowledge of the officers of
the Borrower, no circumstances have arisen whereby any
remedial action is likely to be required to be taken by, or at
the expense of, any member of the Borrower Group under or
pursuant to any law or regulation applicable to the business,
property or assets of a member of the Borrower Group.
15.2 REPETITION
The representations and warranties in Clause 15.1 (Representations and
Warranties) shall be deemed to be repeated by the Borrower each time a
Drawdown Notice is issued, on each Drawdown Date and on each Interest
Payment Date with reference to the facts and circumstances existing
from time to time.
16. UNDERTAKINGS
16.1 DURATION
The undertakings in Clause 16 (Undertakings) shall remain in force from
and after the date of this Agreement and so long as any sum remains
payable under this Agreement or any part of a Facility remains
available.
16.2 INFORMATION
The Borrower shall furnish to the Facility Agent, in sufficient copies
for each of the Finance Parties:-
(a) as soon as they are available, but in any event within 180
days after the end of each of its Financial Year, copies of
the audited consolidated financial statements (including, but
not limited to, a balance sheet profit and loss statement and
cashflow statement prepared on a consolidated basis) of the
Borrower Group in respect of such Financial Year together with
a certificate signed by an Approved Officer and countersigned
by an executive director of the Borrower certifying that the
financial covenants set out in Schedule 8 have been complied
with as of the immediately preceding Financial Covenant Test
Date and setting out the calculations in reasonable detail;
(b) as soon as they are available, but in any event within 30 days
after the end of each quarter period of each of its Financial
Years, copies of the unaudited consolidated financial
statements (including, but not limited to, a balance sheet
profit and loss statement and cashflow statement prepared on a
consolidated basis) of the Borrower Group in respect of such
quarter year period together with a certificate signed by an
Approved Officer and countersigned by an executive director of
the Borrower certifying that no Default has occurred during
such quarter year period;
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(c) as soon as they are available, but in any event within 30 days
after the end of each quarter period of each of its Financial
Years copies of the Hybrid Financial Statements for such
quarter period certified as correct by an Approved Officer and
countersigned by an executive director of the Borrower;
(d) as soon as they are available, but in any event within 60 days
after the end of each of its Financial Year, copies of the
Hybrid Financial Pro-forma for the next Financial Year and/or
any other cash flow or financial projections prepared on a US
GAAP basis as the Facility Agent may request;
(e) upon written request from the Facility Agent following the
occurrence of a Default (i) promptly the then latest available
unaudited financial statements of the Borrower Group whether
for the previous half-yearly, quarterly or monthly period or
otherwise and (ii) as soon as they are available, but no later
than 30 days after the end of the month in which the Default
occurred, copies of the unaudited consolidated financial
statements (including a profit and loss account, cash flow
statement and balance sheet prepared on a basis consistent
with the audited financial statements prepared on a
consolidated basis) of the Borrower Group in respect of such
period between the date of the latest audited or unaudited (as
the case may be) consolidated financial statements provided by
the Borrower Group to the Facility Agent and the end of the
month in which the Default occurred;
(f) promptly on request, all notices or other documents despatched
by the Borrower or any other member of the Borrower Group to
its shareholders or creditors (or any class thereof);
(g) promptly on request, such further information (including
without limitation, any cash flow or financial projections
prepared on a US GAAP basis for any period, except that a
Hybrid Financial Pro-forma in addition to a Hybrid Financial
Pro-forma provided pursuant to 16.2(d) above may only be
requested following a Default which is continuing) in the
possession or control of the Borrower with respect to the
financial condition and operations of any other member of the
Group as the Facility Agent or any Finance Parties may from
time to time reasonably request;
(h) promptly, details of any actual, pending or threatened
litigation, arbitration or administrative proceedings against
any member of the Borrower Group or any of their respective
assets which may, materially and adversely affect any Security
Party's financial condition or its ability to perform its
obligations under this Agreement;
(i) promptly, details of any circumstance which might lead to a
Mandatory Prepayment; and
(j) promptly, details of any change in the structure of the
Borrower Group or the EAN Group or the ownership of any member
of the Borrower Group or the
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EAN Group from that set out in the Group Structure Chart which
may be materially adverse to the interests of the Finance
Parties.
All financial statements required under this Agreement (except any
Hybrid Financial Pro-forma) shall be prepared in accordance with US
GAAP consistently applied (or if not consistently applied accompanied
by details of the inconsistencies) and shall fairly represent the
financial condition of the Borrower Group. Such financial statements,
if audited, shall be certified without qualification by a recognised
firm of independent accountants acceptable to the Facility Agent or if
qualified by such accountants, the qualification is acceptable to the
Facility Agent acting reasonably; and, if unaudited, shall be
accompanied by a certificate signed by an Approved Officer and
countersigned by an executive director of the Borrower to the effect
that such financial statements are true in all respects and fairly
represent the financial condition of the Borrower Group or the AssetCo
Group as the case may be.
16.3 PROPER RECORDS
The Borrower Group shall keep proper records and books of account in
respect of its business and permit the Facility Agent or any Lender
and/or any professional consultants appointed by the Facility Agent or
such Lender at all reasonable times upon reasonable prior notice to
inspect and examine the records and books of account of the Borrower
and each member of the Borrower Group.
16.4 MERGERS
No member of the Borrower Group will, without the prior written consent
of the Facility Agent (acting on the instructions of the Majority
Lenders) enter into any merger or consolidation with any entity or take
any step with a view to dissolution, liquidation or winding-up.
16.5 INSURANCE
(a) The Borrower will, and for other members of the Borrower Group
which currently maintains any Insurances, procure that such
member of the Borrower Group effect and maintain such
Insurance over and in respect of the assets and business with
reputable underwriters or insurance companies in such manner
and to such extent as is reasonable and customary for a
business enterprise engaged in the same or a similar business
and in the same or similar localities and whose practice is
not to self-insure;
(b) The Facility Agent may at any time and from time to time
appoint an independent insurance advisor experienced in the
field in which the Borrower or other member of the Borrower
Group effects and maintains Insurances, to review and advise
the Facility Agent and the Lenders on the Insurances effected
by the Borrower and other members of the Borrower Group and,
if agreed to by the insurance advisor, provide a summary of
such advice to the Borrower. Upon receipt of such a summary
the Borrower shall consult its own insurance advisor and the
Facility Agent, the independent insurance advisor, the
Borrower and the Borrower's insurance advisor shall negotiate
for a period
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of 14 days with each other in good faith to implement the
recommendations (if any) set out in such a summary and, if
after a period of 14 days the Borrower's insurance advisor
agrees with the advice of such independent insurance advisor,
the Borrower shall use commercially reasonable efforts to
implement the advice contained in such summary;
(c) The Borrower will promptly notify the Facility Agent if any
member of the Borrower Group takes out (or if there is taken
out on behalf of it) any Insurances (other than director's
liability insurance or third party liability insurance) and
such Insurances are not subject to any Security Interests in
favour of the Finance Parties under a Security Document and,
within 10 Business Days of request by the Facility Agent,
execute an Additional Assignment of Insurances on terms
substantially similar to the other Assignments of Insurances
and deliver such other documentation in form and substance
satisfactory to the Security Trustee in respect of such
Insurances.
16.6 SHARE CAPITAL
The Borrower will not, and will procure that no other member of the
Borrower Group or CNC HK will, without the prior written consent of the
Facility Agent, purchase or redeem any of its issued shares or reduce
its share capital or make a distribution of assets or other capital
distribution to its shareholders except if :-
(a) no Default is continuing or would occur at the time of or as a
result of such purchase, redemption, reduction or
distribution;
(b) the Facility Agent has been granted a Security Interest over
the shares in the member of the Borrower Group which is
purchasing or redeeming any of its issued shares or reducing
its share capital or to which a distribution of assets or
other capital distribution is being made;
(c) the Facility Agent has been granted a Security Interest over
the assets or capital the subject of such distribution; and
(d) such purchase, redemption, reduction or distribution is by and
amongst members of the Borrower Group.
16.7 DIVIDENDS
The Borrower undertakes and agrees with the Facility Agent throughout
the continuance of the Facility Agreement and so long as any sum
remains owing hereunder that it will not declare or pay any dividends
or make any other distribution (whether of an income or capital nature)
except if:-
(i) no Default has occurred or would occur at the time of or as a
result of such declaration, payment or distribution;
(ii) such declaration, payment or distribution shall not result in
a breach of the financial covenants under Clause 3 of Schedule
8; and
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(iii) the amount in respect of which such declaration, payment or
distribution has been made is not greater than 50% of the
distributable profits of the Borrower in the Financial Year
preceding the time of such declaration, payment or
distribution.
16.8 LENDING AND GUARANTEES
The Borrower will not and will procure that no other member of the
Borrower Group will make or grant any loan or advance to, or give any
guarantee, indemnity, bond or letter of credit to or for the benefit
of, or in respect of the liabilities or obligations of, any other
person other than a member of the Borrower Group or voluntarily assume
any liability (whether actual or contingent) of any other person other
than a member of the Borrower Group. For the avoidance of doubt, intra
group loans by and amongst members of the Borrower Group are permitted
provided that such intra group loans are expressly subordinated to all
amounts owing under the Finance Documents under the terms of a
subordination deed in form and substance satisfactory to the Lenders
pursuant to which, inter alia, upon the occurrence of a Default, the
principal of, and interest accruing on such intra group loans shall not
be paid, repaid, payable or repayable in whole or in part.
16.9 FURTHER INFORMATION
The Borrower shall provide the Facility Agent with such financial and
other information concerning the Borrower or any other member of the
Borrower Group as the Facility Agent or any Lender (acting through the
Facility Agent) may from time to time reasonably require provided that
the disclosure of such financial or other information is permitted by
law or regulation (whether or not having force of law) applicable to
the Borrower.
16.10 NOTIFICATION OF DEFAULTS
The Borrower will and shall procure that each other member of the
Borrower Group promptly inform the Facility Agent of any occurrence of
any event which it becomes aware of which may adversely affect its
ability to perform its respective obligations under the Finance
Documents in any material respect or of any Default forthwith upon
becoming aware of the same and will from time to time, if so requested
by the Facility Agent, confirm to the Facility Agent in writing that,
save as otherwise stated in such confirmation, no Default has occurred
and is continuing.
16.11 CONSENTS
The Borrower will, and shall procure that each other member of the
Borrower Group obtain and promptly renew from time to time and
thereafter maintain in full force and effect, and will comply in all
material respects with, all Consents and all authorisations, approvals,
consents, licences and exemptions as may be required under any
applicable law or regulation to enable it to perform its obligations
under the Finance Documents to which it is respectively a party or
required for the validity or enforceability of such Finance Documents.
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16.12 USE OF PROCEEDS
The Borrower will use the proceeds of each Advance for the purposes
specified in Clause 3 (Purpose).
16.13 PARI PASSU RANKING
The Borrower undertakes that its obligations under this Agreement do
and will at all times rank at least pari passu with all other present
and future unsecured and unsubordinated obligations of the Borrower
save for any obligations mandatorily preferred by law and not by
contract.
16.14 COMPLIANCE WITH LAWS AND REGULATIONS
The Borrower will comply, and will ensure that each other member of the
Borrower Group complies with all laws, regulations, agreements,
licences and concessions material to the carrying on of its respective
business.
16.15 CONSTITUTIONAL DOCUMENTS
The Borrower will (and the Borrower shall ensure that each other member
of the Borrower Group will) procure that no material amendment or
supplement is made to its Memorandum of Association and Bye-Laws other
than any amendment which (a) is made pursuant to any shareholders'
agreement among the Borrower and its shareholders and (b) does not
materially and adversely affect the ability of the Borrower or any
member of the Borrower Group to perform its respective obligations
under the Finance Documents.
16.16 FURTHER UNDERTAKINGS
The Borrower undertakes with the Facility Agent and the Lenders that,
without the prior written consent of the Majority Lenders:-
(a) BORROWER NEGATIVE PLEDGE: it will not and shall procure that
no other member of the Borrower Group shall create or permit
to arise or exist any Security Interest on all or any part of
the assets of the Borrower or any other member of the Borrower
Group or any income or profit therefrom, unless
contemporaneously therewith or prior thereto Indebtedness
owing to the Lenders under this Agreement is equally and
rateably secured, other than:
(i) Vendor Financing Security;
(ii) Security Interests created prior to the date of this
Agreement and previously disclosed in writing to the
Lenders;
(iii) liens arising solely by operation of law in the
ordinary course of a Borrower Group member's
business;
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(iv) any Security Interest over an asset acquired by the
Borrower or any other member of the Borrower Group
after the date of this Agreement in existence at the
time such asset was acquired but only to the extent
that the principal amount secured by that Security
Interest has not been incurred or increased in
contemplation of, or since, the acquisition;
(v) Security Interests over assets acquired or to be
acquired or developed or to be developed and created
for the purpose of securing repayment of Indebtedness
borrowed solely for the purpose of financing or
refinancing the acquisition or development cost of
such asset and in circumstances where the aggregate
principal amount of such financings or refinancings,
when aggregated together with the aggregate principal
amount of the financings or refinancings referred to
in Clause 7.15(a)(v) of the EAN Guarantee does not
exceed at any time US$500,000; and
(vi) to the extent it creates a Security Interest, any
Security Interest that arises in connection with the
deposit of cash with the Industrial and Commercial
Bank of China (Asia) Limited or any of its affiliates
for the issuance of guarantees or other banking
facilities as collateral for trade finance facilities
in the ordinary course of business of any member of
the Borrower Group provided that the aggregate amount
of such deposits when aggregated together with any
deposits referred to in Clause 7.15(a)(vi) of the EAN
Guarantee, shall not exceed US$10,000,000 at any
time.
(b) TRANSACTIONS SIMILAR TO SECURITY: it will not (and shall
procure that no other member of the Borrower Group will):
(i) sell, transfer or otherwise dispose of any of its
assets on terms whereby it is or may be leased to or
re-acquired or acquired by the Borrower or any member
of the Borrower Group or any of its or their
Affiliates; or
(ii) sell, transfer or otherwise dispose of any of its
receivables on recourse terms, except for the
discounting of bills or notes in the ordinary course
of trading,
in circumstances where the transaction is entered into
primarily as a method of raising finance or of financing the
acquisition of an asset;
(c) DISPOSALS: it will not (and shall procure that no other member
of the Borrower Group will), without the consent of the
Facility Agent (acting on the instructions of the Majority
Lenders) either in a single transaction or in a series of
transactions whether related or not and whether voluntarily or
involuntarily, dispose of all or any material part of the
business or assets or revenues of the Borrower or such other
member of the Borrower Group, except disposals made in good
faith for full consideration on an arm's length basis in the
ordinary course of its business, and provided that such
disposal does not, materially and adversely affect the ability
of the Borrower or any
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other member of the Borrower Group to perform its respective
obligations under the Finance Documents or the rights of the
Finance Parties under the Finance Documents.
(d) ACCESSION/SECURITY FOR FUTURE MEMBERS OF THE BORROWER GROUP:
The Borrower shall ensure that any person which becomes a
Material Subsidiary shall, to the extent permitted by law and
as soon as is reasonably possible after becoming a Material
Subsidiary but in any event no later than 30 Business Days
after the date on which it becomes a Material Subsidiary,
become a Security Party and provide the documents and other
evidence listed in Schedule 17 (Documents required to be
delivered by an Additional Security Party) to the Security
Trustee as security in favour of the Finance Parties to secure
all of the obligations and liabilities of the Security Parties
under the Finance Documents.
(e) ALTERNATIVE SECURITY ARRANGEMENTS: If a Material Subsidiary
is, or is likely to be, unable to grant the Security Interests
required to be granted pursuant to paragraph (d) above as a
result of applicable law or regulatory restrictions, the
Borrower and the Facility Agent shall negotiate in good faith
to agree alternative security arrangements.
(f) NEW ASSETS WHICH MAY NEED SUPPLEMENTAL SECURITY: The Borrower
shall procure that each member of the Borrower Group which is
a Material Subsidiary shall to the extent legally possible
promptly notify the Facility Agent if it increases its issued
or registered share capital or if any investments or assets
are acquired by it or on its behalf and such shares or
investments or assets are not subject to any Security
Interests in favour of the Finance Parties under a Security
Document and, within 10 Business Days of request by the
Facility Agent, execute (or, in the case of shares, procure
the execution of a Security Document on terms substantially
similar to the appropriate Share Mortgage, subject to any
necessary changes) an Additional Security Document and deliver
such other documentation in form and substance satisfactory to
the Security Trustee (acting reasonably) in respect of such
Collateral.
(g) RIGHT TO REQUEST SECURITY OVER SHARES IN A MEMBER OF THE GROUP
WHICH BECOMES A MATERIAL SUBSIDIARY: Within 30 Business Days
of receipt of a request by the Security Trustee, the Borrower
or any other member of the Borrower Group shall execute a
share pledge or a share charge over any share capital it owns
in any member of the Borrower Group which becomes a Material
Subsidiary (on terms substantially similar to the appropriate
Share Mortgage, subject to any necessary changes) and deliver
such other documentation in form and substance satisfactory to
the Security Trustee (acting reasonably) in respect of that
share capital.
(h) FURTHER ACTION TO PERFECT SECURITY: Each member of the
Borrower Group shall (and the Borrower shall ensure that each
other member of the Borrower Group will), at its own expense,
promptly take all such action as the Facility Agent or the
Security Trustee may require:
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(i) for the purpose of perfecting or protecting the
Finance Parties' rights under, and preserving the
Security Interests, ranking and subordination, as the
case may be, intended to be created or evidenced by,
any of the Finance Documents; and
(ii) for the purpose of facilitating the realisation of
any of those Security Interests,
including the execution of any transfer, conveyance,
assignment or assurance of any asset and the giving of any
notice, order or direction and the making of any registration
which the Facility Agent or the Security Trustee may require
under the terms of the Finance Documents or by any law or
regulation.
(i) NO ACTION WHICH MAY PREJUDICE SECURITY: No member of the
Borrower Group shall (and the Borrower shall ensure that no
other member of the Borrower Group will) do, or consent to the
doing of, anything which might prejudice the effectiveness,
enforceability or priority of any of the Security Interests
created pursuant to the Security Documents.
(j) RESTRICTIVE AGREEMENTS, NEGATIVE PLEDGES: No member of the
Borrower Group shall (and the Borrower shall ensure that no
other member of the Borrower Group will) enter into (or permit
to exist) any agreement or arrangement (other than the Finance
Documents) prohibiting or restricting:
(i) the creation or existence of any Security Interest on
any of the assets of any member of the Borrower Group
except assets the subject of Security Interests
permitted under Clause 16.16
(ii) the ability of any member of the Group to make any
payments, directly or indirectly, to any member of
the Group (whether by way of dividends, advances,
repayments of or payments of interest on advances,
reimbursement of management and other intercom any
charges, expenses, accruals or other returns on
investments, or otherwise),
provided that if any relevant laws, agreements or arrangements
restrict or prohibit the creation or existence of any Security
Interests required to be given by a member of the Borrower
Group, the Borrower will (and the Borrower will ensure that
any relevant member of the Borrower Group will) use all
reasonable endeavours to remove the restriction or prohibition
or implement arrangements which provide economically
substantially the same result as if Security Interests were
granted over the relevant assets.
16.17 NO ADDITIONAL BORROWING
(a) The Borrower will not and will procure that no members of the
Borrower Group shall without the consent of the Lenders,
borrow or raise or have outstanding Indebtedness or credit
except (i) pursuant to this Agreement, (ii)
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pursuant to the Vendor Financing or (iii) subject always to
the other provisions and only on the terms of this Clause
16.17 (No Additional Borrowing), Permitted Indebtedness.
(b) Notwithstanding the foregoing, the Borrower undertakes that if
the Borrower wishes to raise any further Indebtedness or
credit at any time after the date of this Agreement, the
Borrower shall first be obliged to give Industrial and
Commercial Bank of China (Asia) Limited or its affiliates
("ICBC") the first right of refusal to arrange a facility of
an amount which, when aggregated with (A) any EAN Request for
Further Financing (as defined in Clause 7.16(b) of the EAN
Guarantee) and (B) any EAN Further Financing (as defined in
Clause 7.16(b) of the EAN Guarantee) as referred to in Clause
7.16 of the EAN Guarantee, shall not in aggregate at any time
be more than US$100,000,000 ("REQUEST FOR FURTHER FINANCING")
on terms and conditions acceptable to ICBC and the Borrower,
such terms and conditions to be determined at such time (the
"FURTHER FINANCING") PROVIDED THAT :-
(i) any Security Interest created to secure such Further
Financing shall rank pari passu with the Security
Interests constituted by the Finance Documents; and
(ii) without prejudice to the provisions of Clause 5.3(b)
(Waiver or Deferral of Conditions) and the Finance
Parties' rights thereunder including in respect of
any Default which may occur:
(x) if the Facility Agent confirms that the
conditions precedent in Clause 5 (Conditions
Precedent) have, in the opinion of the
Finance Parties, been satisfied in full or
otherwise unconditionally waived by the date
on which ICBC has received a Request for
Further Financing, ICBC shall have until the
date falling 5 months after the date of
ICBC's receipt of the Request for Further
Financing to sign a mandate letter to
arrange such Further Financing with the
Borrower; or
(y) if the Facility Agent confirms that the
conditions precedent in Clause 5 (Conditions
Precedent) have not, in the opinion of the
Finance Parties, been satisfied in full or
otherwise unconditionally waived by the date
on which ICBC has received a Request for
Further Financing, then ICBC shall have
until whichever date ("LONGSTOP DATE") is
the later of (1) the date falling 2 weeks
after the date on which the Facility Agent
confirms that the conditions precedent in
Clause 5 (Conditions Precedent) have, in the
opinion of the Finance Parties, been
satisfied in full and (2) the date falling 5
months from the date of ICBC's receipt of
the Request for Further Financing, to sign a
mandate letter to arrange such Further
Financing with the Borrower; and
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(iii) if so arranged, the Borrower undertakes to borrow the
Further Financing subject to the terms and conditions
thereof.
(c) (i) If where the circumstances set out in Clause 16.17(b)
(ii)(x) (No Additional Borrowing) apply, ICBC and the
Borrower have not, by the end of the period set out
therein, signed a mandate letter to arrange such
Further Financing, the Borrower may then be permitted
to seek to raise additional Indebtedness (other than
the Further Financing) from persons other than a
member of the CNC HK Group or any of their respective
Affiliates (a "THIRD PARTY") of an amount which when
aggregated with any additional Indebtedness of EAN
which is expressly permitted pursuant to Clause 7.16
of the EAN Guarantee shall not in aggregate at any
time be more than US$200,000,000 (the "ADDITIONAL
FINANCING"); or
(ii) If where the circumstances set out in Clause
16.17(b)(ii)(y) (No Additional Borrowing) apply, ICBC
and the Borrower have not, by the Longstop Date,
signed a mandate letter to arrange such Further
Financing, the Borrower may then be permitted to seek
Additional Financing,
in each such case, subject always to the provisions of Clauses
16.17(d) to (g) (No Additional Borrowing) inclusive below.
(d) Any Further Financing and any Additional Financing shall be on
terms acceptable to the Finance Parties and which do not
prejudice any of the Security Interests constituted by the
Finance Documents or any of the rights and remedies of the
Finance Parties thereunder.
(e) The Borrower further agree that it will, prior to entering
into any binding contract for Additional Financing with any
such Third Party, offer ICBC the opportunity to provide or
arrange the Additional Financing on terms no less favourable
to ICBC than those proposed to be offered by the Third Party
and ICBC shall make its determination within one month of the
receipt by ICBC of the material terms offered by the Third
Party to the Borrower and if ICBC makes a determination to
provide such financing ("ALTERNATIVE FURTHER FINANCING"), any
Security Interest created to secure such Alternative Further
Financing shall rank pari passu with the Security Interests
constituted by the Finance Documents.
(f) Any additional Indebtedness permitted pursuant to this Clause
16.17(b) to (e) (No Additional Borrowing) inclusive shall:-
(i) in respect of any Additional Financing arrangement
with a Third Party, other than, for the avoidance of
doubt, any Further Financing, bear interest at a rate
comparable to that obtainable by a Telecommunications
Provider;
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(ii) in respect of any Additional Financing arrangement
with a Third Party, other than any Further Financing
or Alternative Further Financing, be on terms entered
into in writing beforehand that it shall be expressly
subordinated to all amounts outstanding from time to
time under the Finance Documents and that any
Security Interests created to secure such
Indebtedness shall rank behind the Security Interests
constituted by the Finance Documents, and be on the
condition that the persons in whose favour the
Security Interests to secure such Indebtedness have
been created cannot enforce their subordinated
Security Interests without the prior written consent
of the Lenders; and
(iii) be subject to the parties to the documents evidencing
such additional Indebtedness and any related Security
Interests ("ADDITIONAL INDEBTEDNESS DOCUMENTS")
entering into intercreditor arrangements with the
Finance Parties contemporaneously with the execution
of the Additional Indebtedness Documents and which
intercreditor arrangement shall be negotiated in good
faith and on terms satisfactory to the Finance
Parties acting reasonably.
(g) The Borrower shall be permitted to pay interest on the Further
Financing, the Additional Financing or the Alternative Further
Financing as the case maybe for so long as no Default has
occurred.
For the avoidance of doubt the Borrower and EAN can together
only raise (i) the Further Financing or (ii) the Alternative
Further Financing or (iii) the Additional Financing but not
more than one of them.
16.18 CASH DEPOSIT
On the Business Day falling at least 5 days prior to each Interest
Payment Date, the Borrower shall ensure that it deposits the Deposit in
the Deposit Account and shall maintain a credit balance of not less
than US$50,000,000 therein provided that subject to the provisions of
the Charge Over Deposit, and provided further that no Default is
continuing, the Borrower may, on the first Business Day falling 2 days
after such Interest Payment Date, withdraw the Deposit and apply it as
the Borrower may see fit.
16.19 OPENING OF DEPOSIT ACCOUNT AND ESCROW ACCOUNTS
Within 7 Business Days from the date of this Agreement and throughout
the term of this Agreement, the Borrower shall open and maintain with
the Facility Agent the Deposit Account and the Escrow Accounts.
16.20 NOTIFICATION AND CONSENT
The Borrower undertakes that it shall and shall procure that each other
member of the Borrower Group notifies and obtains the prior written
consent of the Facility Agent without which the following matters shall
not be permitted:
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(i) to the proposed sale, transfer, lease or other disposal by any
member of the Borrower Group of any of its respective material
assets by giving 14 Business Days prior written notice; and
(ii) where any member of the Borrower Group proposes to seek or
launch an IPO, including any proposal to effect any
reorganization or restructuring schemes or arrangements in
preparation for an IPO by giving 60 days prior written notice.
16.21 MANDATORY PREPAYMENT
The Borrower shall comply with its obligations under Clause 7
(Prepayment).
16.22 BOARD OF DIRECTORS
Subject to any applicable law, regulation or listing rule of any
Internationally Recognised Stock Exchange, the Borrower shall at all
times ensure that it controls the appointment of the directors to the
board of directors of each member of the Borrower Group.
16.23 CHANGE OF BUSINESS
The Borrower shall procure that no material change is made to the
general nature of the business of the Borrower or other members of the
Borrower Group from that carried on at the Effective Date without the
prior written consent of the Facility Agent.
16.24 FINANCIAL UNDERTAKINGS
The Borrower undertakes with the Facility Agent that it will comply and
will procure compliance with the financial covenants set out in
Schedule 8.
16.25 FINANCIAL YEAR
The Borrower shall maintain 31st December as the last day of its
Financial Year and shall notify the Facility Agent of any change to its
Financial Year end.
16.26 SECURITY AND SECURITY PERFECTION REQUIREMENTS
The Borrower shall ensure:
(a) FURTHER SECURITY AND PERFECTED SECURITY: that the Debentures
(other than the Initial Debentures), the Share Mortgages
(other than the Initial Share Mortgages) and the Subordination
Deeds (other than the Initial Subordination Deeds) are
executed and delivered to the Security Trustee as soon as
practicable after the First Drawdown Date and in any event no
later than 4 months from the First Drawdown Date (in the case
of the Debenture no.17 in Schedule 11) and no later than 2
months from the First Drawdown Date (in all other cases) (or
such longer period as the Facility Agent and the Security
Trustee, acting reasonably, shall agree) and that with respect
to each Security Document, all Security Perfection
Requirements with respect to that Security
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Document are completed to the satisfaction of the Facility
Agent and the Security Trustee including without limitation
that:
(i) those listed in Part A of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within 1 Business Day from the date of
execution of the relevant document(s) referred to in
such Part;
(ii) those listed in Part B of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within 5 Business Days from the date
of execution of the relevant document(s) referred to
in such Part;
(iii) those listed in Part C of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within 7 Business Days from the date
of execution of the relevant document(s) referred to
in such Part;
(iv) those listed in Part D of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within 14 Business Days from the date
of execution of the relevant document(s) referred to
in such Part;
(v) those listed in Part E of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within 21 days from the date of
execution of the relevant document(s) referred to in
such Part;
(vi) those listed in Part F of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within 30 days from the date of
execution of the relevant document(s) referred to in
such Part;
(vii) those listed in Part G of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within 5 weeks from the date of
execution of the relevant document(s) referred to in
such Part;
(viii) those listed in Part H of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within 37 days from the date of
execution of the relevant document(s) referred to in
such Part; and
(ix) those listed in Part I of Schedule 18, are completed
and evidence to the satisfaction of the Finance
Parties in respect thereof is provided to the
Facility Agent within the time limit specified in the
relevant Security Document referred to therein.
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(b) EAC2 SECURITY: as soon as reasonably practicable following the
consummation of the transactions contemplated by the Deeds of
Transfer, Release and Settlement and the Vendor Financing
Transfer Documents, (the "SETTLEMENT DATE") that:-
(i) EAN enters into an Additional Security Document
and/or Additional Debenture in respect of any right,
title or interest which it has in and to the EAC2
Project (as defined in the NEC Contract) and/or the
System and/or any System Upgrade and/or any Segment
Upgrade (each as respectively defined in the NEC
Contract) as soon as possible after the Settlement
Date and in any event within 4 months of the
Settlement Date and provides evidence satisfactory to
the Facility Agent that all the Security Perfection
Requirements in respect thereof have been completed
and in any event within 4 months of the Settlement
Date; and
(iii) any member of the Borrower Group which has at any
time any right, title or interest, in and to the EAC2
Project (as defined in the NEC Contract) and/or the
System and/or any System Upgrade and/or any Segment
Upgrade (each as respectively defined in the NEC
Contract) or any part thereof or to any assets or
licenses, permits or consents which are necessary in
respect of, or connected with, the EAC2 Project or
the System or any System Upgrade or any Segment
Upgrade or its, commissioning or operation shall
enter into an Additional Security Document as soon as
possible after the Settlement Date and in any event
within 4 months of the Settlement Date and provides
evidence satisfactory to the Facility Agent that all
the Security Perfection Requirements in respect
thereof have been completed and in any event within 4
months of the Settlement Date.
(c) ADDITIONAL SECURITY: that each Additional Security Party
enters into an Additional Security Document, Additional
Debenture, Additional Assignment of Insurances, Additional
Share Mortgage and/or Additional Subordination Deed as soon as
practicable after request from the Facility Agent and in any
event no later than 4 months from such date and that such
Additional Security Party provides the documents and other
evidence listed in Schedule 17 to the Security Trustee.
(d) NEWLY PERMITTED SECURITY: that with respect to any member of
the Borrower Group or the EAN Group or CNC BVI which, owing to
the laws or regulations in any relevant jurisdiction, is not
as at the Effective Date able to provide a Security Interest
over certain of its assets, such member of the Borrower Group,
EAN Group or CNC BVI as the case may be shall, as soon as
reasonably practicable following a change in or introduction
of or change in interpretation of a law or regulation in any
such jurisdiction which permits or enables such member of the
Borrower Group, EAN Group or CNC BVI as the case may be so to
provide such a Security Interest over those assets (the
"PERMISSION DATE"), such member of the Borrower Group, EAN
Group or CNC BVI as the case may be shall enter into an
Additional Security
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Document and/or Additional Debenture as soon as possible after
the Permission Date and in any event within 4 months of the
Permission Date and provides evidence satisfactory to the
Facility Agent that all the Security Perfection Requirements
in respect thereof have been completed and in any event within
4 months of the Permission Date.
(e) CHINA NETWORK COMFORT LETTER: if by 31st August 2004, CNC HK
is unable to satisfy the financial criteria set out in
paragraphs (i), (ii) and (iii) of the definition of "GUARANTOR
IPO DATE" in clause 1.1 of the CNC HK Guarantee, that China
Network executes a comfort letter in favour of the Security
Trustee for the benefit of the Finance Parties in form and
substance acceptable to the Finance Parties in support of the
obligations of CNC HK and the Borrower under the Finance
Documents.
17. EVENTS OF DEFAULT
17.1 EVENTS OF DEFAULT
There shall be an Event of Default if, for any reason and whether or
not for a reason outside the control of the Borrower:-
(a) NON-PAYMENT: the Borrower or any Security Party fails to pay
any sum due from it under this Agreement or any other Finance
Document to which it is a party at the time, in the currency
and in the manner stipulated herein or therein unless :-
(i) its failure to pay is caused by administrative or
technical error; and
(ii) payment is received within 4 Business Days of its due
date.
(b) OTHER BREACHES:
(i) the Borrower fails duly and punctually to comply with
any of its obligations under Clause 16.18 (Cash
Deposits); or
(ii) any Security Party fails duly and punctually to
comply with any of its other obligations (other than
those referred to in Clause 17.1(a) (Non-Payment)
above) under any of the Finance Documents and in
respect only of a failure which in the opinion of the
Facility Agent (after consulting with the Majority
Lenders) is capable of remedy, does not remedy such
failure to the Facility Agent's satisfaction within 3
Business Days after receipt of written notice from
the Facility Agent requiring it to do so; or
(c) BREACH OF REPRESENTATION: any representation or warranty made
or deemed to be made or repeated by or in respect of the any
Security Party in or pursuant to any of the Finance Documents
or in any notice, certificate or statement referred to or
delivered under any Finance Document is or proves to have been
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incorrect or misleading in any respect considered by the
Majority Lenders to be material; or
(d) CONSENTS: any consent, authorisation, licence or approval of,
or registration with or declaration to, governmental or public
bodies or authorities or courts required by the Borrower or
any other Security Party to authorise, or required by the
Borrower or any other Security Party in connection with, the
execution, delivery, performance, validity, enforceability or
admissibility in evidence of any of the Finance Documents is
modified in a manner unacceptable to the Majority Lenders or
is not granted or is revoked or terminated or expires and is
not renewed or otherwise ceases to be in full force and effect
and such Security Party has not within 1 month of such
modification, non granting, revocation or termination obtained
the necessary consent, authorisation, license or approval; or
(e) LEGAL PROCESS: any judgment or order made against the Borrower
or any other Security Party is not stayed or complied with
within 14 Business Days or a creditor attaches or takes
possession of, or a distress, execution, sequestration or
other process is levied or enforced upon or sued out against,
any of the undertakings, assets, rights or revenues of the
Borrower or any other Security Party and is not discharged
within 30 Business Days or any step is taken to enforce any
present or future Security Interest on or over all or any part
of the assets or revenues of the Borrower or any other
Security Party or any other member of the Borrower Group
PROVIDED THAT any of the aforementioned actions has a material
adverse effect on the business or financial condition of the
Borrower Group or the AssetCo Group or the ability of any
Security Party to perform all or any of its obligations under
or otherwise to comply with the terms of any of the Finance
Documents; or
(f) INSOLVENCY: the Borrower or any other Security Party is deemed
to be unable to pay its debts or becomes, or admits to being
unable to pay its debts as they fall due or otherwise becomes
insolvent or stops or suspends or threatens to stop or suspend
making payments (whether of principal or interest) with
respect to all or any class of its debts or announces an
intention to do so or any person takes any action, or any
proceedings are started or other steps taken by any person for
the Borrower or any other Security Party to be adjudicated or
found bankrupt or insolvent unless otherwise permitted by
Clause 16.4 (Mergers); or
(g) WINDING-UP: any person takes any action or any petition is
presented or other step is taken for the purpose of winding
up, re-organising, reconstructing or dissolution of the
Borrower or any other Security Party not being a petition
which the Borrower or any other Security Party can demonstrate
to the satisfaction of the Facility Agent is either frivolous,
vexatious or an abuse of the process of the court or relates
to a claim to which the Borrower or any other Security Party
has a good defence and which is being contested by the
Borrower or any other Security Party and by appropriate
proceedings and in each case provided that such petition is
discharged within 14 Business Days or an order is made or
resolution is passed for the winding up, re-organising,
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reconstructing or dissolution of the Borrower or any other
Security Party or a meeting is convened for the purpose of
passing any such resolution unless otherwise permitted by
Clause 16.4 (Mergers); or
(h) LIQUIDATION/ADMINISTRATION: any person takes any action or any
proceedings are started or other step taken by any person for
a liquidator, administrator, trustee or similar officer to be
appointed by the Borrower or any other Security Party or any
part of their respective undertakings, assets, rights or
revenues or the Majority Lenders have reasonable grounds to
believe that any such proceedings or other step is imminent
unless otherwise permitted by Clause 16.4 (Mergers); or
(i) APPOINTMENT OF RECEIVERS AND MANAGERS: any person takes any
action or any proceedings are started or other step taken by
any person for any administrative or other receiver to be
appointed of the Borrower or any other Security Party or any
part of their respective material assets, rights, revenues
and/or undertakings or the directors of the Borrower or any
other Security Party request any person to appoint such a
receiver unless otherwise permitted by Clause 16.4 (Mergers);
or
(j) COMPOSITIONS: any negotiations are commenced or any other
steps are taken, by the Borrower or any other Security Party
by any of their respective creditors with a view to proposing
any kind of composition, compromise general assignment or
arrangement involving such company or with a view to the
general readjustment or rescheduling or a moratorium of all or
part of its debts or proceedings are commenced in relation to
the Borrower or any other Security Party under any law
regulation or procedure relating to construction or
readjustment of debts; or
(k) ANALOGOUS PROCEEDINGS: there occurs, in relation to the
Borrower or any other Security Party, in any country or
territory (including Hong Kong) in which it carries on
business or to the jurisdiction of whose courts any part of
its assets is subject, any event which, in the opinion of the
Majority Lenders, appears in that country or territory to
correspond with, or have an effect equivalent or similar to,
any of those mentioned in Clauses 17.1 (e) to (j) (Events of
Default) (inclusive) or the Borrower or any other Security
Party otherwise becomes subject, in any such country or
territory, to the operation of any law relating to insolvency,
bankruptcy or liquidation; or
(l) SUSPENSION OF BUSINESS OR EXPROPRIATION: the Borrower or any
other Security Party suspends or ceases or threatens to
suspend or cease to carry on its business or any substantial
part thereof or changes or threatens to change the nature or
scope of its business or any governmental or other authority
through Expropriation acquires all or any substantial part of
its respective business, assets, rights or revenues, or shares
or other ownership therein; or
(m) CESSATION OR SUSPENSION OF LISTING:
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(i) after the listing of the shares in CNC HK on a
Guarantor Stock Exchange has occurred, the shares in
CNC HK cease to be listed on such Guarantor Stock
Exchange or trading in the shares in CNC HK is
suspended for a period of more than 14 consecutive
trading days; or
(ii) after the listing of the shares of any member of the
Group on any Internationally Recognised Stock
Exchange has occurred, the shares in such member of
the Group cease to be listed on such Internationally
Recognised Stock Exchange or trading in such shares
is suspended for a period of 14 consecutive trading
days; or
(n) ILLEGALITY: it becomes or will become unlawful at any time for
the Borrower or any other Security Party to perform all or any
of its obligations under any of the Finance Documents or any
of the obligations of the Borrower or any other Security Party
under any of the Finance Documents is not or ceases to be or
is claimed by it not to be legal, valid and binding or in full
force and effect; or
(o) CROSS DEFAULT:
(i) any Financial Indebtedness of the Borrower, any other
Security Party, or any other member of the CNC HK
Group or the AssetCo Group:-
(A) is not paid when due nor within any
applicable grace period in any agreement
relating to that Financial Indebtedness; or
(B) becomes due and payable, or capable of being
declared due and payable, before its stated
maturity by reason of a default or event of
default, however described;
(ii) any Security Interest, guarantee or other security
created or to be created by the Borrower, or any
other Security Party or any other member of the CNC
HK Group or the EAN Group becomes enforceable; or
(p) REPUDIATION: the Borrower or any other Security Party
repudiates any of the Finance Documents, or does or causes to
be done any act or thing evidencing an intention to repudiate
any of the Finance Documents or any action or proceedings are
commenced (and not withdrawn or dismissed within a period of
14 Business Days after its commencement) to enjoin or restrain
the performance of or compliance with any respective
obligation of the Borrower or any other Security Party under
any of the Finance Documents or otherwise dispute the ability
of the Borrower or any other Security Party to enter into,
exercise its respective rights or perform or comply with any
of its respective obligations under any of the Finance
Documents; or
(q) MATERIAL ADVERSE CHANGE: there occurs, in the reasonable
opinion of the Majority Lenders, a material adverse change in
the financial condition of the Borrower, any other Security
Party or any other member of the CNC HK Group or the AssetCo
Group; or
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(r) MATERIAL EVENTS: any other event occurs or circumstance arises
which, in the reasonable opinion of the Majority Lenders, is
likely to materially and adversely affect the ability of the
Borrower or any other Security Party to perform all or any of
its obligations under or otherwise to comply with the terms of
any of the Finance Documents, as the case may be; or
(s) REDUCTION OR LOSS OF CAPITAL: a meeting is convened by the
Borrower or any other Security Party for the purpose of
passing any resolution to purchase, reduce or redeem any of
its share capital other than in accordance with Clause 16.6
(Share Capital); or
(t) OWNERSHIP: (i) CNC HK ceases to be the Holding Company of the
Borrower; or (ii) China Network ceases to be the Holding
Company of CNC HK, AssetCo and EAN; or
(u) MATERIAL LITIGATION: any litigation, arbitration or
administrative proceeding is taking place against the Borrower
or any other Security Party which, in the reasonable opinion
of the Majority Lenders, is likely to materially and adversely
affect the ability of the Borrower or any other Security Party
to perform all or any of their respective obligations under or
otherwise to comply with the terms of any of the Finance
Documents; or
(v) FINANCIAL COVENANTS: the Borrower fails to comply with any of
its financial covenants in Schedule 8 on any Financial
Covenant Test Date; or
(w) WAIVER: any of the conditions precedent (if any) which have
been the subject of a waiver in accordance with Clause 5.3
(Waiver or Deferral of Conditions) has not been fulfilled in
full and to the Finance Parties' satisfaction on the date
stipulated in the relevant waiver, or, if no date is
stipulated, then the date falling 3 months after the First
Drawdown Date.
17.2 ACCELERATION
The Facility Agent may, and if so requested by the Majority Lenders
shall, without prejudice to any other rights of the Lenders, at any
time after the occurrence of an Event of Default by notice to the
Borrower:-
(a) declare that the obligation of each Lender to make its
Commitment available shall be terminated, whereupon the Total
Commitments shall be reduced to zero forthwith; and/or
(b) declare that the Tranche A Loan and/or the Tranche B Loan, all
interest and all other sums payable under the Finance
Documents have become immediately due and payable, whereupon
the same shall, immediately or in accordance with the terms of
such notice, become due and payable without further demand or
other legal formality of any kind; and/or
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(c) take any action, exercise any other right or pursue any other
remedy conferred upon the Facility Agent and/or the Lenders by
this Agreement or by any applicable law or regulation or
otherwise as a consequence of such Event of Default.
18. ASSIGNMENT AND TRANSFER
18.1 BENEFIT OF AGREEMENT
This Agreement shall be binding upon, and enure for the benefit of each
Finance Party, the Facility Agent and the Borrower and their respective
successors and permitted assigns.
18.2 TRANSFERS BY THE BORROWER
The Borrower may not assign, transfer, novate or in any way dispose of
any of its rights and/or obligations under this Agreement.
18.3 ASSIGNMENTS BY THE LENDERS
Each Lender may assign or otherwise transfer or grant participations in
all or any part of its rights under any of the Finance Documents to any
other bank or financial institution without the consent of the Borrower
in accordance with Clause 18.4 (Transfer Certificates) in respect of
transfers or novations.
18.4 TRANSFER CERTIFICATES
Each Lender (an "EXISTING LENDER") may assign or novate or otherwise
transfer all or any part of its rights, benefits and/or obligations
under the Finance Documents to another person (a "NEW LENDER"). Any
such transfer shall be effected upon 5 Business Days' prior notice by
delivery to the Facility Agent of a duly executed and duly completed
Transfer Certificate in which event, on the transfer date specified in
such Transfer Certificate, to the extent that they are expressed to be
the subject of the novation established by the Transfer Certificate:-
(a) the Borrower, the Existing Lender and the other parties to the
Finance Documents shall be released from further obligations
towards one another under any of the Finance Documents and
their respective rights against one another under any of the
Finance Documents shall be cancelled (such rights and
obligations being referred to in this Clause 18.4 (Transfer
Certificates) as "DISCHARGED RIGHTS AND OBLIGATIONS");
(b) the Borrower and the New Lender shall assume obligations
towards one another and/or acquire rights against one another
which differ from such Discharged Rights and Obligations only
insofar as the New Lender have assumed and/ or acquired the
same in place of the Existing Lender;
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(c) the Facility Agent, the Co-ordinating Arrangers, the New
Lender and other Lenders shall acquire the same rights and
assume the same obligations between themselves as they would
have acquired and assumed had the New Lender been an Existing
Lender with the rights and/ or obligations acquired or assumed
by it as a result of the transfer and to that extent the
Facility Agent, the Arrangers and the Existing Lender shall
each be released from further obligations to each other under
this Agreement; and
(d) the New Lender shall become a party to this Agreement as a
"Lender",
and, on the date upon which such novation or transfer takes effect, the
New Lender shall pay to the Facility Agent for its own account a fee of
US$800. The Facility Agent shall promptly notify the other parties to
this Agreement of the receipt by it of any Transfer Certificate and
shall promptly deliver a copy of such Transfer Certificate to the
Borrower.
For the avoidance of doubt, the Borrower shall not be responsible for
paying the above fee of US$800 on behalf of the New Lender.
18.5 RELIANCE
The Facility Agent and the Borrower shall be fully entitled to rely on
any Transfer Certificate delivered to the Facility Agent in accordance
with the foregoing provisions of Clause 18 (Assignment and Transfer)
which is complete and regular on its face as regards its contents and
purportedly signed on behalf of the Existing Lender and the New Lender
and neither the Facility Agent nor the Borrower shall have any
liability or responsibility to any party as a consequence of placing
reliance on and acting in accordance with any such Transfer Certificate
if it proves to be the case that the same was not authentic or duly
authorised.
18.6 SIGNATURE OF TRANSFER CERTIFICATE
The Borrower and each Finance Party irrevocably authorises the Facility
Agent to countersign each Transfer Certificate on its behalf without
any further consent of, or consultation with, the Borrower or such
Lender.
18.7 REFERENCES
If any Lender assigns or novates or otherwise transfers all or any part
of its rights, benefits and/or obligations in accordance with Clause 18
(Assignment and Transfer), all relevant references in the Finance
Documents to such Lender shall thereafter be construed as a reference
to such Lender and/or its assignee or transferee (as the case may be)
to the extent of their respective interests.
18.8 FACILITY OFFICE
Each Lender shall lend through its Facility Office at the address
specified in Schedule 1 or as the case may be in any Transfer
Certificate or through any of its other offices as selected from time
to time by such Lender for the purposes of this Agreement. A
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Lender shall notify the Facility Agent promptly of any change of its
office pursuant to Clause 23 (Notices).
18.9 DISCLOSURE
The Facility Agent or any Lender may disclose on a confidential basis
to a prospective assignee or Transferee or to any other person who may
propose entering into, or who has entered into, contractual relations
with the Facility Agent or such Lender in relation to this Agreement
such information about the transactions contemplated by this Agreement
or about any member of the Group as the Facility Agent or such Lender
shall consider appropriate.
18.10 REFERENCE BANKS
If a Reference Bank ceases to act as such for any reason, it shall be
replaced by such other bank as the Facility Agent (after consultation
with the Lenders) shall designate by notice to the Borrower and the
Lenders.
19. THE FACILITY AGENT, THE ARRANGER AND THE LENDERS
19.1 APPOINTMENT
(a) Each Finance Party hereby irrevocably appoints the Facility
Agent as its agent for the purposes of this Agreement and as
its agent and trustee to receive, hold, administer and enforce
the security created by the Security Documents.
(b) Each Finance Party hereby irrevocably authorises the Facility
Agent (whether or not by or through employees or agents) to
take such action on such Finance Party's behalf and to
exercise such rights, remedies, powers and discretion as are
specifically delegated to the Facility Agent by the Finance
Documents, together with such powers and discretions as are
reasonably incidental thereto.
(c) The Facility Agent shall not have any duties, obligations or
liabilities to the Finance Parties beyond those expressly
stated in the Finance Documents; and those duties are solely
of a mechanical and administrative nature.
(d) The Facility Agent may act under the Finance Documents through
its personnel and agents.
19.2 VARIATION
(a) Subject to Clause 19.2(b) (Variation), the Facility Agent may,
with the prior written consent of the Majority Lenders, amend,
modify or otherwise vary or waive breaches of, or defaults
under, or otherwise excuse performance of, any provision of
any of the Finance Documents. Any such action so authorised
and effected by the Facility Agent shall be promptly notified
to the Finance Parties by the Facility Agent and shall be
binding on all the Finance Parties.
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(b) Except with the prior written consent of all the Finance
Parties, the Facility Agent shall not have authority on behalf
of the Finance Parties to agree with the Borrower or the
Guarantor any amendment to any of the Finance Documents which
would (i) reduce the rate of interest payable under any of the
Finance Documents, (ii) extend the due date or reduce the
amount of any payment of principal, interest or other amount
payable under any of the Finance Documents, (iii) change the
currency in which any amount is payable under any of the
Finance Documents, (iv) increase any Lender's Commitment or
the length of the Drawdown Period, (v) release or amend any of
the obligations of any Security Party under any of the Finance
Documents, (vi) change the definition of "Majority Lenders" in
Clause 1.1 (Terms Defined), (vii) change Clause 16
(Undertakings) or Clause 17 (Events of Default) or (viii)
change this Clause 19.2 (Variation).
(c) Any amendment, modification or variation of any of the
Facility Agent's rights and/or obligations under any of the
Finance Documents shall require the prior written consent of
the Facility Agent.
19.3 FACILITY AGENT AND THE ARRANGER INDIVIDUALLY
(a) With respect to its own Commitment and Outstandings (if any),
each of the Facility Agent and the Arrangers shall have the
same rights and powers under the Finance Documents as any
other Lender and may exercise the same as though it were not
performing the duties and functions delegated to it as agent
or arranger, as the case may be, under the Finance Documents
and the term "Lenders" shall unless the context clearly
otherwise indicates, include the Facility Agent and the
Arranger, in their respective individual capacity as a Lender.
This Agreement shall not and shall not be construed so as to
constitute a partnership between the parties or any of them.
(b) In acting as the Facility Agent, the agency division of the
Facility Agent will be treated as a separate entity from its
other divisions and departments. Any information acquired by
the Facility Agent which, in its opinion, is acquired by it
otherwise than in its capacity as the Facility Agent may be
treated as confidential by the Facility Agent and will not be
deemed to be information possessed by the Facility Agent in
its capacity as such.
19.4 EXONERATION
The Facility Agent shall not:-
(a) be obliged to request any certificate or opinion under any of
the Finance Documents or to make any enquiry as to the use of
the proceeds of any Advance or the Loan unless so required in
writing by any Lender, in which case the Facility Agent shall
promptly make the appropriate request to the Borrower, or be
obliged to make any enquiry as to any Default or other breach
by the Borrower or the Guarantor in the performance or
observance of any of the provisions of any of the Finance
Documents or as to the existence of any Default or other
breach unless the Facility Agent has actual knowledge thereof
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or has been notified in writing thereof by a Lender, in which
case the Facility Agent shall promptly notify the Lenders of
the relevant event or circumstance; or
(b) be liable to any Lender for any action taken or omitted under
or in connection with the Finance Documents, the Facility or
the Loan unless caused by its gross negligence or wilful
misconduct, and no party to this Agreement may take any
proceedings against any officer, employee or agent of the
Facility Agent in respect of any claim it might have against
the Facility 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 of the Finance
Documents.
For the purposes of this Clause 19.4 (Exoneration), the Facility Agent
shall not be treated as having actual knowledge of any matter of which
the corporate finance or any other division outside the corporate
lending or loan administration department of the person for the time
being acting as the Facility Agent may become aware in the context of
corporate finance or advisory activities from time to time undertaken
by the Facility Agent for the Borrower or any associated companies.
19.5 INFORMATION AND ACTION
The Facility Agent shall:-
(a) promptly notify each Finance Party of the contents of each
material notice, certificate or other document received by the
Facility Agent from the Borrower or any other Security Party
in relation to the Facility;
(b) promptly notify each Finance Party of any Event of Default of
which the Facility Agent has actual knowledge; and
(c) (subject to its being indemnified to its satisfaction) take
such action or, as the case may be, refrain from taking such
action with respect to any Default of which the Facility Agent
has actual knowledge as the Majority Lenders may reasonably
direct.
19.6 RELIANCE
The Facility Agent may deem and treat (i) each Lender as the person
entitled to the benefit of the Outstandings of such Lender for all
purposes of this Agreement unless and until a notice of assignment of
such Lender's Outstandings or any part thereof or a Transfer
Certificate shall have been delivered to the Facility Agent, and (ii)
the Facility Office specified in Schedule 1 or, as the case may be, in
any relevant Transfer Certificate as such Lender's Facility Office
unless and until a written notice of change of Facility Office shall
have been received by the Facility Agent and the Facility Agent may act
upon any such notice unless and until the same is superseded by a
further such notice. The Facility Agent shall be entitled to rely on
any communication, instrument or document believed by it to be genuine
and correct and to have been appropriately authorised and signed or
sent by the proper person and
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shall be entitled to rely as to legal or other professional matters on
opinions and statements of any legal or other professional advisers
selected or approved by it.
19.7 CREDIT APPROVAL
Each Lender acknowledges that it has not relied on any statement,
opinion, forecast or other representation made by the Facility Agent to
induce it to enter into this Agreement and that it has made and will
continue to make without reliance on the Facility Agent and based on
such documents as it considers appropriate its own appraisal of the
creditworthiness of the Borrower and the Group and its own independent
investigation of the financial condition and affairs of the Borrower
and the Group in connection with the making of any Advance and
continuation of the Loan under this Agreement. The Facility Agent shall
not have any duty or responsibility, either initially or on a
continuing basis, to provide any Lender with any credit or other
information with respect to the Borrower or any other member of the
Group whether coming into its possession before the drawdown of any
Advance or at any time or times thereafter, other than as provided in
Clause 19.5(a) (Information and Action).
19.8 DOCUMENTATION
The Facility Agent shall not have any responsibility to any Finance
Party for:
(a) the performance by the Borrower or any other Security Party of
their respective obligations under any of the Finance
Documents;
(b) the financial condition of the Borrower or any other Security
Party;
(c) the completeness or accuracy of any statements,
representations or warranties in any of the Finance Documents
or any document delivered thereunder;
(d) the execution, effectiveness, adequacy, genuineness, validity,
enforceability or admissibility in evidence of any of the
Finance Documents or of any certificate, report or other
documents executed or delivered under any of the Finance
Documents;
(e) the collectability of amounts payable under any of the Finance
Documents; or
(f) otherwise in connection with the Facility or its negotiation
or for acting (or, as the case may be, refraining from acting)
in accordance with the instructions of the Majority Lenders,
or the Lenders, as the case may be.
19.9 OTHER BUSINESS
Each of the Facility Agent and the Arranger may, without any liability
to account to the Lenders, accept deposits from, lend money to, and
generally engage in any kind of banking or trust business with, the
Borrower, CNC HK or any other member of the Group or any of the Lenders
as if it were not the Facility Agent or the Arranger (as the case may
be).
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19.10 REIMBURSEMENT AND INDEMNITY
(a) Each Lender shall reimburse the Facility Agent (rateably in
accordance with its Outstandings or, if at the relevant time,
no Advance has been made under this Agreement, its
Commitment), to the extent the Facility Agent is not
reimbursed by the Borrower, for the charges and expenses
incurred by the Facility Agent in contemplation of, or
otherwise in connection with, the enforcement of, or the
preservation of any rights under, or in carrying out its
duties under any of the Finance Documents, including (in each
case) the fees and expenses of legal or other professional
advisers.
(b) Each Lender shall indemnify the Facility Agent (rateably in
accordance with its Outstandings or, if at the relevant time,
no Advance has been made under this Agreement, its Commitment)
against all liabilities, damages, costs and claims whatsoever
incurred by the Facility Agent in connection with any of the
Finance Documents or the performance of its duties under any
of the Finance Documents or any action taken or omitted by the
Facility Agent under any of the Finance Documents, unless such
liabilities, damages, costs or claims arise from the Facility
Agent's own gross negligence or wilful misconduct.
(c) The Borrower shall forthwith on demand reimburse each Lender
for any payment made by it under Clauses 19.10(a) and (b)
(Reimbursement and Indemnity).
(d) The Facility 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 will or may
incur in taking any proceedings or action arising out of or in
connection with any of the Finance Documents before it
commences those proceedings or takes that action.
19.11 MAJORITY LENDERS' INSTRUCTIONS
(a) Unless expressly stated in the provisions of the Finance
Documents, the Facility Agent shall (i) act in accordance with
any instructions given to it by the Majority Lenders (or, if
so instructed by the Majority Lenders, refrain from acting or
exercising any right, power, authority or discretion vested in
it as Facility Agent) and (ii) not be liable for any act (or
omission) if it acts (or refrains from taking any action) in
accordance with such an instruction of the Majority Lenders.
(b) Unless expressly stated in the provisions of the Finance
Documents, any instructions given by the Majority Lenders will
be binding on all the Lenders.
(c) Where a provision of any of the Finance Documents provides for
any matter to be determined by reference to the opinion of the
Majority Lenders or to be subject to the consent or request of
the Majority Lenders or for any action to be taken on the
instructions of the Majority Lenders, such opinion, consent,
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request or instructions shall (as between the Lenders) only be
regarded as having been validly given or issued by the
Majority Lenders if all the Lenders shall have received prior
notice of the matter on which such opinion, consent, request
or instructions are required to be obtained and the relevant
majority of the Lenders shall have given or issued such
opinion, consent, request or instructions but so that the
Borrower shall be entitled (and bound) to assume that such
notice shall have been duly received by each Lender and that
the relevant majority shall have been obtained to constitute
Majority Lenders whether or not this is the case.
(d) The Facility Agent may decline to take any action except upon
the written direction of the Majority Lenders, or the Lenders,
as the case may be, and the Facility Agent may obtain a
ratification by the Majority Lenders of any action taken by it
under the Finance Documents. The Facility Agent shall have no
liability to any of the Lenders for any action taken by it
upon the instructions of the Majority Lenders or if such
actions is ratified by the Majority Lenders.
(e) In the absence of instructions from the Majority Lenders, or
the Lenders, as the case may be, the Facility Agent may act
(or refrain from taking action) as it considers to be in the
best interest of the Lenders.
(f) The Facility Agent is not authorized to act on behalf of a
Lender (without first obtaining that Lender's consent) in any
legal or arbitration proceedings relating to any of the
Finance Documents.
19.12 RETIREMENT
(a) The Facility Agent may retire from its appointment as Facility
Agent under the Finance Documents having given to the Borrower
and each of the Finance Parties not less than 30 days' notice
of its intention to do so, provided that no such retirement
shall take effect unless there has been appointed by the
Finance Parties as a successor agent:-
(i) a Lender nominated by the Majority Lenders within 30
days after notice of retirement or, failing such a
nomination,
(ii) any reputable and experienced bank or financial
institution with offices in Hong Kong nominated by
the Facility Agent.
(b) Upon any such successor as aforesaid being appointed, the
retiring Facility Agent shall deliver or make available to
such successor all records, files and information held by it
as the Facility Agent. The retiring Facility Agent shall then
be discharged from any further obligation under the Finance
Documents and its successor and each of the other parties to
any of the Finance Documents shall have the same rights and
obligations among themselves as they would have had if such
successor had been a party to the Finance Documents in place
of the retiring Facility Agent. No member of the Borrower
Group shall be required to pay any fees or expenses in
relation to the retirement or appointment of a Facility Agent
pursuant to this Clause 19.12
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(Retirement) if such fees have already been paid in accordance
with Clause 20 (Fees and Expenses).
19.13 COMPLIANCE
(a) The Facility 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 prejudice to Clause 19.13(a) (Compliance) above, the
Facility Agent need not disclose any information relating to
the Borrower or any member of the Group if the disclosure
might, in the opinion of the 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.
19.14 THE ARRANGER
The Arranger in its capacity as such shall have no duties or
obligations under or in respect of the Finance Documents. Clauses 19.7
(Credit Approval), 19.8 (Documentation) and 19.9 (Other Business) shall
apply for the benefit of the Arranger in its capacity as such as if
references therein to the Facility Agent were references to the
Arranger.
19.15 RELATIONSHIP
(a) The relationship between the Facility Agent and the Lenders is
that of agent and principal only.
(b) Except as specifically provided in this Agreement, the
Arranger has no other obligations to any other party to this
Agreement under or in connection with the Finance Documents.
(c) Nothing in this Agreement constitutes the Facility Agent or
the Arranges as a trustee or fiduciary of any other person.
(d) Neither the Facility Agent nor the Arranger shall be bound to
account to any Lender for any sum or the profit element of any
sum received by it for its own account.
20. FEES AND EXPENSES
20.1 ARRANGEMENT FEE
The Borrower shall pay to the Arranger an arrangement fee in the amount
set out in the Fee Letter.
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20.2 AGENCY FEE
The Borrower shall pay to the Facility Agent an agency fee in the
amount and at the times set out in the Fee Letter.
20.3 COMMITMENT FEE
(a) The Borrower shall pay to the Facility Agent for the account
of each Lender, a commitment fee computed at the rate of 0.45%
per annum on that Lender's Available Commitment in respect of
Tranche A for the Drawdown Period.
(b) The Borrower shall pay to the Facility Agent for the account
of each Lender a commitment fee computed at the rate of 0.45%
per annum on that Lender's Available Commitment in respect of
Tranche B for the Drawdown Period for Tranche B set out in
Schedule 3.
(c) The accrued commitment fee in this Clause 20.3 (Commitment
Fee) is payable on the last day of each successive period of
three months during the Drawdown Period, and the last such
payment to be made on the last day of the Drawdown Period, and
if any Lender's Available Commitment is cancelled in full, on
the cancelled amount of the relevant Available Lender's
Commitment at the time the cancellation is effective.
(d) The commitment fee payable in this Clause 20.3 (Commitment
Fee) shall accrue from day to day and shall be calculated on
the basis of the actual number of days elapsed and a 360-day
year, including the first day of the period during which it
accrues but excluding the last.
20.4 EXPENSES
The Borrower shall pay to the Facility Agent and the Arranger on demand
and in the currency specified by the Facility Agent and Arranger:-
(a) irrespective as to whether any Advance is made, all expenses
(including legal, printing and out-of-pocket expenses)
reasonably incurred by the Facility Agent or the Arranger or
any Lender in connection with the negotiation, preparation and
execution of the Finance Documents and any amendment or
extension of or the granting of any waiver or consent under
the Finance Documents; and
(b) all expenses on a full indemnity basis (including legal and
out-of-pocket expenses) incurred by the Facility Agent or the
Arranger or any Lender in connection with the enforcement of
or preservation of any rights under any of the Finance
Documents, or otherwise in respect of the monies owing under
any of the Finance Documents together with interest at the
Default Rate from the date on which such expenses were
incurred to the date of payment (both before and after
judgment).
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20.5 STAMP DUTY
The Borrower shall pay all stamp, documentary, registration or other
like duties or taxes (including any duties or taxes payable by any
Lender) imposed on or in connection with the Finance Documents, the
Facility or the Loan and shall indemnify each of the Facility Agent,
the Arranger and the Lenders against any liability arising by reason of
any delay or omission by the Borrower to pay such duties or taxes.
21. SET-OFF
(a) Without prejudice to any right of set-off, combination of
accounts, lien or other rights which the Facility Agent or any
Lender is at any time entitled whether by operation of law or
contract or otherwise, the Facility Agent or any Lender may
(but shall not be obliged to) set off against any obligation
of the Borrower due and payable by it under the Finance
Documents without prior notice any monies held by the Facility
Agent or any Lender for the account of the Borrower regardless
of the place of payment, booking branch or currency of either
obligation.
(b) If the obligations are in different currencies, the Facility
Agent or any Finance Party may convert either obligation at a
market rate of exchange in its usual course of business for
the purpose of the set-off.
22. PRO RATA SHARING
22.1 REDISTRIBUTION
If at any time any Lender (a "RECEIVING LENDER") has received
(including without limitation by way of payment into a suspense
account) or recovered (whether by set-off or otherwise) any amount
owing by the Borrower under this Agreement other than through the
Facility Agent (which for the avoidance of doubt shall include by
reference to Clause 6 or Clause 7) in accordance with Clause 13.4
(Distribution) (a "RECOVERY"), then:-
(a) such Receiving Lender shall, within 3 Business Days of such
Recovery, 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 Receiving Lender would have
received had the Recovery been received by the Facility Agent
and distributed in accordance with Clause 13.4 (Distribution);
(c) subject to Clause 22.2 (Exceptions), the Receiving Lender
shall within 3 Business Days of demand by the Facility Agent
pay to the Facility Agent an amount equal to the excess (the
"REDISTRIBUTION");
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(d) the Facility Agent shall treat the Redistribution as if it
were a payment by the Borrower under Clause 13 (Payments) and
shall pay the Redistribution to the Lenders (other than the
Receiving Lender) in accordance with Clause 13.4
(Distribution); and
(e) after payment of the Redistribution, the Receiving Lender will
be subrogated to the portion of the claims paid under (d)
above and the Borrower will owe the Receiving Lender a debt
which is equal to the Redistribution immediately payable and
of the type originally discharged;
PROVIDED THAT where a Receiving Lender is subsequently required to
repay to the Borrower any amount received or recovered by it and dealt
with under sub-clauses (a) to (e) above:
(i) each Lender which has received a share of the relevant
Redistribution pursuant to this Clause shall, upon request of
the Facility Agent, pay to the Facility Agent for account of
that Recovering Lender an amount equal to its share of the
Redistribution (together with an amount as is necessary to
reimburse that Recovering Lender for its proportion of any
interest on the Redistribution which that Recovering Lender is
required to pay);
(ii) that Recovering Lender's rights of subrogation in respect of
any reimbursement shall be cancelled and the Borrower will be
liable to the reimbursing Lender for the amount so reimbursed;
(iii) this Clause 22.1 (Redistribution) shall not constitute and
shall not be construed as constituting a Security Interest by
any Lender over all or any part of any sum received or
recovered by it in the manner set out in Clause 22 (Pro Rata
Sharing).
22.2 EXCEPTIONS
(a) A Receiving Lender need not pay a redistribution to the extent
that it would not after the payment have a valid and
enforceable claim against the Borrower in the amount of the
redistribution pursuant to Clause 22.1(e) (Redistribution).
(b) Where a recovery is resulted from the satisfaction or
enforcement of a judgment obtained in any legal action or
proceedings taken by a Receiving Lender, Clause 22 (Pro rata
Sharing) shall not apply so as to benefit any other Lender
which (being entitled so to do) did not join with the
Receiving Lender in such action or proceedings, unless the
Receiving Lender did not give prior notice of its involvement
in such action or proceedings to the Facility Agent for
disclosure to the other Lenders.
22.3 NOTIFICATION
Each Lender shall promptly give notice to the Facility Agent of:-
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(a) the institution by such Lender of any legal action or
proceedings under this Agreement or in connection with the
Finance Document prior to such institution; and
(b) the receipt or recovery by such Lender of any amount received
or recovered by it under the Finance Document or in connection
with the Finance Document otherwise than through the Facility
Agent.
Upon receipt of any such notice the Facility Agent shall as soon as
practicable thereafter notify all the other Lenders.
23. NOTICES
23.1 NOTICES
Any notice or communication under or in connection with the Finance
Documents shall be in writing and shall be delivered personally or by
prepaid letter (airmail if available) or facsimile transmission to the
addresses or facsimile numbers set out below or at such other address
as the recipient may have notified to the other parties in writing.
Proof of posting or despatch of any notice or communication to any
party hereto shall be deemed to be proof of receipt:-
(a) in the case of a letter, on the fifth Business Day after
posting if airmail or second Business Day if local mail;
(b) in the case of a facsimile transmission, on the Business Day
immediately following the date of despatch with confirmed
facsimile report.
All communications or other correspondence between the Borrower and any
of the Lenders in connection with the Finance Documents shall be made
through the Facility Agent.
23.2 ADDRESSES
Notices or communications shall be sent to the following addresses and
facsimile numbers:-
To the Borrower:-
Name Asia Netcom Corporation Limited
Address 46 ▇▇▇▇▇▇ Kong Center
▇ ▇▇▇▇▇'▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
Fax (▇▇▇) ▇▇▇▇ ▇▇▇▇
Attention ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇/Wenlong Sun
With a copy to: Asia Netcom Singapore Pte Limited
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▇ ▇▇▇▇▇▇▇ ▇▇▇ #▇▇-▇▇
▇▇▇ ▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax (▇▇) ▇▇▇▇ ▇▇▇▇
Attention ▇▇▇▇▇▇ ▇▇
With a copy to: China Netcom Corporation Limited
▇▇.▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
PRC
Fax (▇▇ ▇▇) ▇▇▇▇ ▇▇▇▇
Attention ▇▇▇▇ ▇▇▇/▇▇▇▇▇▇ Pan
To the Facility Agent:-
Name Industrial and Commercial Bank of China
(Asia) Limited
Address 10/F, ICBC Asia ▇▇▇▇▇▇▇▇
▇▇▇-▇▇▇ ▇▇▇▇▇'▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
Fax (▇▇▇) ▇▇▇▇ ▇▇▇▇
Attention ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇/ Ms. ▇▇▇ ▇▇▇▇
And to the Lenders at their respective Facility Offices specified in
Schedule 1 or as notified by the Facility Agent in writing.
23.3 LANGUAGE
Each notice or document referred to in the Finance Documents or to be
delivered under the Finance Documents shall be in the English language.
24. AGREEMENT TO PERMIT ADDITIONAL LENDERS
24.1 AGREEMENT TO PERMIT ADDITIONAL LENDERS
Each of the parties to this Agreement agrees with the other parties
that the Borrower or the Arranger shall have the right to procure that
following the First Drawdown Date, an additional financial institution
or financial institutions (the "ADDITIONAL LENDERS" and each an
"ADDITIONAL LENDER") accedes to this Agreement for the purposes of
providing additional funding to the Borrower under this Agreement of up
to an amount which, when aggregated with the Total Commitments set out
as at the date of this Agreement in Schedule 1, would result in the
Total Commitments at that
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time being increased to an amount which is no greater than
US$150,000,000 and this Agreement shall be amended and restated
accordingly.
24.2 SUPPLEMENTAL AGREEMENT, ACCESSION AND RECALCULATION
If the circumstances set out in Clause 24.1 occur, each of the parties
to this Agreement agrees with the other parties that each Lender's
proportion of the Total Commitments set out as at the date hereof in
Schedule 1 shall be recalculated by the Facility Agent for the purposes
of Clauses 2, 4, 6 and 13 and Schedule 1. Each of the parties to this
Agreement agrees with the other parties that such Additional Lender's
accession to this Agreement, the increase in the Total Commitments and
recalculation as aforesaid shall be evidenced by a supplemental
agreement or deed at that time, amending and restating this Agreement
which shall be entered into by the parties to this Agreement at that
time and such Additional Lender(s), in form and substance satisfactory
to the Facility Agent.
Each of the parties to this Agreement agrees with the other parties
that the terms of such supplemental agreement shall include without
limitation:
(a) an obligation on such Additional Lender(s) to advance to the
Borrower immediately after so acceding to this Agreement and
in any event, at the time of the then next succeeding Advance
to the Borrower under this Agreement, sufficient amounts
(which will be deemed to be an Advance under whichever Tranche
the Facility Agent shall determine as appropriate in good
faith for the purposes of this Agreement) and which amounts
shall be distributed by the Facility Agent to the Lenders as a
prepayment of Tranche A, so as to adjust the proportion of the
then Tranche A Advances outstanding to the Lenders to the
Agreed Proportion (if and to the extent the same has not
already occurred at such date pursuant to Clause 2); and
(b) an acknowledgement by the Finance Parties at that date in
favour of the Additional Lender(s) that the Additional
Lender(s) are entitled and shall share in the Security
Interests constituted by or the subject of the Security
Documents pro rata pari passu with the other Lenders,
and the Facility Agent is hereby authorised by the parties to this
Agreement to make such amendments to this Agreement as it shall
consider necessary to give effect to the intention of the parties to
this Agreement for the purposes of this Clause.
24.3 BORROWER'S UNDERTAKING
The Borrower undertakes to the Finance Parties that it shall use all
reasonable endeavours to procure the introduction of such Additional
Lender(s) as soon as possible after the date hereof so as to give
effect to the intention of the parties to this Agreement for the
purposes of this Clause.
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25. AGREEMENT TO PERMIT LENDER TO INCREASE ITS COMMITMENT
25.1 AGREEMENT TO PERMIT LENDER TO INCREASE ITS COMMITMENT
Each of the parties to this Agreement agrees with the other parties
that following the First Drawdown Date, any Lender shall have the
right, upon giving not less than 14 Business Days' notice to the
Facility Agent and the Borrower, to provide additional funding to the
Borrower under this Agreement of up to an amount which, when aggregated
with the Total Commitments set out as at the date of this Agreement in
Schedule 1, would result in the Total Commitments at that time being
increased to an amount which is no greater than US$150,000,000 and this
Agreement shall be amended and restated accordingly.
25.2 SUPPLEMENTAL AGREEMENT AND RECALCULATION
If the circumstances set out in Clause 25.1 occur, each of the parties
to this Agreement agrees with the other parties that each Lender's
proportion of the Total Commitments set out as at the date hereof in
Schedule 1 shall be recalculated by the Facility Agent for the purposes
of Clauses 2, 4, 6 and 13 and Schedule 1. Each of the parties to this
Agreement agrees with the other parties that such increase in the Total
Commitments and recalculation as aforesaid shall be evidenced by a
supplemental agreement or deed at that time, amending and restating
this Agreement which shall be entered into by the parties to this
Agreement at that time, in form and substance satisfactory to the
Facility Agent.
Each of the parties to this Agreement agrees with the other parties
that the terms of such supplemental agreement shall include without
limitation:
(a) an obligation on such Lender to advance to the Borrower
immediately after so notifying the Facility Agent, and in any
event, at the time of the then next succeeding Advance to the
Borrower under this Agreement, sufficient amounts (which will
be deemed to be an Advance under whichever Tranche the
Facility Agent shall determine as appropriate in good faith
for the purposes of this Agreement) and which amounts shall be
distributed by the Facility Agent to the Lenders as a
prepayment of Tranche A, so as to adjust the proportion of the
then Tranche A Advances outstanding to the Lenders to the
Agreed Proportion (if and to the extent the same has not
already occurred at such date pursuant to Clause 2); and
(b) an acknowledgement by the Finance Parties at that date in
favour of the relevant Lender that such relevant Lender is
entitled and shall share in the Security Interests constituted
by or the subject of the Security Documents pro rata pari
passu with the other Lenders,
and the Facility Agent is hereby authorised by the parties to this
Agreement to make such amendments to this Agreement as it shall
consider necessary to give effect to the intention of the parties to
this Agreement for the purposes of this Clause.
[Facility Agreement]
-86-
25.3 BORROWER'S UNDERTAKING
The Borrower undertakes to the Finance Parties that it shall use all
reasonable endeavours to procure the occurrence of the circumstances
set out in Clause 24.1 as soon as possible after the date hereof so as
to give effect to the intention of the parties to this Agreement for
the purposes of this Clause.
26. WAIVER; AMENDMENTS AND CONSENTS; REMEDIES, SEVERABILITY AND
COUNTERPARTS
26.1 WAIVERS
No failure or delay on the part of the Facility Agent or any Finance
Party to exercise any power, right or remedy under the Finance
Documents shall operate as a waiver thereof, nor shall any single or
partial exercise by the Facility Agent or any Finance Party of any
power, right or remedy preclude any other or further exercise thereof
or the exercise of any other power, right or remedy.
26.2 AMENDMENTS AND CONSENTS
(a) Any amendment of any provision of the Finance Documents shall
only be effective if made in accordance with provisions with
this Agreement and the Borrower and the Facility Agent so
agree in writing and any waiver of any breach or default under
the Finance Documents shall only be effective if the Facility
Agent acting on the instructions of the Lenders or the
Majority Lenders, as the case may be agrees in writing. Any
consent by the Facility Agent under this Agreement must be
made in writing.
(b) Any such waiver or consent may be given subject to any
conditions thought fit by the Facility Agent or the Lenders or
the Majority Lenders, as the case may be, and shall be
effective only in the instance and for the purpose for which
it is given.
26.3 REMEDIES
The remedies provided in the Finance Documents are cumulative and are
not exclusive of any remedies provided by law.
26.4 SEVERABILITY
If any provision of the Finance Documents is prohibited or
unenforceable in any jurisdiction such prohibition or unenforceability
shall not invalidate the remaining provisions hereof or affect the
validity or enforceability of such provision in any other jurisdiction.
[Facility Agreement]
-87-
26.5 COUNTERPARTS
This Agreement may be executed in any number of counterparts including
by facsimile and all of which taken together shall constitute one and
the same instrument, and any party hereto may execute this Agreement by
signing any such counterpart.
27. GOVERNING LAW AND JURISDICTION
27.1 GOVERNING LAW
This Agreement is governed by and construed in accordance with Hong
Kong law.
27.2 SUBMISSION OF JURISDICTION
For the benefit of the Facility Agent, the Arranger and each Lender,
the Borrower irrevocably agrees that the courts of Hong Kong are to
have jurisdiction to settle any disputes which may arise out of or in
connection with this Agreement and that, accordingly, any legal action
or proceedings arising out of or in connection with this Agreement
("PROCEEDINGS") may be brought in those courts and the Borrower
irrevocably submits to the jurisdiction of those courts.
27.3 OTHER JURISDICTIONS
Nothing in this Clause 27 (Governing Law and Jurisdiction) shall limit
the right of the Facility Agent the Arranger or any Lender to take
Proceedings against the Borrower in any other court of competent
jurisdiction nor shall the taking of Proceedings in one or more
jurisdictions preclude the Facility Agent or the Arranger or any Lender
from taking Proceedings in any other jurisdiction, whether concurrently
or not.
27.4 WAIVER OF INCONVENIENT FORUM
The Borrower irrevocably waives any objection which it may at any time
have to the laying of the venue of any Proceedings in any court
referred to in Clause 27 (Governing Law and Jurisdiction) and any claim
that any such Proceedings have been brought in an inconvenient forum.
27.5 PROCESS AGENT
The Borrower irrevocably appoints Asia Netcom Asia Pacific Commercial
Limited of ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇ ▇▇▇▇▇'▇ ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇ (the "PROCESS AGENT") to receive, for it and on its behalf,
service of process in any Proceedings in Hong Kong. Such service shall
be deemed completed on delivery to the Process Agent (whether or not it
is forwarded to and received by the Borrower). If for any reason the
Process Agent ceases to be able to act as such or no longer has an
address in Hong Kong, the Borrower irrevocably agrees to appoint a
substitute process agent acceptable to the Facility Agent, and to
deliver to the Facility Agent a copy of the new process agent's
acceptance of that appointment, within 14 days.
[Facility Agreement]
-88-
27.6 SERVICE
The Borrower irrevocably consents to any process in any Proceedings
anywhere being served by mailing a copy by post in accordance with
Clause 23 (Notices). Nothing shall affect the right to serve any
process in any other manner permitted by law.
27.7 WAIVER IMMUNITIES
To the extent that the Borrower has or hereafter may acquire any
immunity (sovereign or otherwise) from any legal action, suit or
proceeding, from the jurisdiction of any court or from setoff or any
legal process (whether service or notice, attachment prior to judgment,
attachment in aide of execution of judgment, execution of judgment or
otherwise) with respect to itself or any of its property, the Borrower
hereby irrevocably waives and agrees not to plead or claim such
immunity in respect of its obligations under this Agreement.
IN WITNESS whereof this Agreement has been entered into on the date stated at
the beginning of this Agreement.
[Facility Agreement]
-89-
[Schedule 1]
(Original Lenders)
SCHEDULE 1
THE ORIGINAL LENDERS AND THEIR COMMITMENTS
Subject to Clause 24 and Clause ▇▇
▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇ ▇
Name Commitment Commitment
---- ---------- ----------
THE INDUSTRIAL AND COMMERCIAL BANK OF CHINA, BEIJING US$17,000,000.00 US$13,000,000.00
BRANCH
THE INDUSTRIAL AND COMMERCIAL BANK OF CHINA, SHANGHAI US$11,333,333.33 US$8,666,666.67
BRANCH
THE INDUSTRIAL AND COMMERCIAL BANK OF CHINA, HONG US$5,666,666.67 US$4,333,333.33
KONG BRANCH
CHINA MINSHENG BANKING CORP. LTD. US$17,000,000.00 US$13,000,000.00
CITIC INDUSTRIAL BANK US$11,333,333.33 US$8,666,666.67
BANK OF COMMUNICATIONS US$5,666,666.67 US$4,333,333.33
HUAXIA BANK US$5,666,666.67 US$4,333,333.33
Total Tranche A Total Tranche B
Commitments Commitments
US$73,666.666,67 US$56,333,333.33
Total Commitments
US$130,000,000
[Facility Agreement]
-90-
[Schedule 2]
(Form of Drawdown Notice)
SCHEDULE 2
FORM OF DRAWDOWN NOTICE
[Date]
To: Industrial and Commercial Bank of China (Asia) Limited
10/F, ICBC Asia Building
▇▇▇-▇▇▇ ▇▇▇▇▇'▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
Term Loan Facility Agreement
dated [ ] 2004
We refer to the facility agreement as amended and restated by the Supplemental
Amendment and Restatement Deed (the "FACILITY AGREEMENT") dated July, 2004
between (1) Asia Netcom Corporation Limited as borrower (the "BORROWER"); (2)
the lenders named therein (the "LENDERS"), (3) Industrial and Commercial Bank of
China (Asia) Limited as facility agent for the Lenders, and (4) Industrial and
Commercial Bank of China (Asia) Limited as arranger in relation to a loan
facility in the maximum aggregate amount of up to US$150,000,000.
We hereby give you notice that we wish to draw down in respect of [Tranche
A/Tranche B] an Advance in the sum of US$[ ] on [ ]. The funds should be
credited to the account of [ ] with [ ].
For the purpose of Clause 8.2(c) (Interest Periods), the Interest Period of this
Advance shall end on [the last day of the then current Interest Period]. [NOTE:
FOR ADVANCES OTHER THAN THE FIRST]
We confirm that:-
(a) no Default has occurred and is continuing or would result from the
making of the Advance hereunder;
(b) the representations and warranties contained in Clause 15
(Representations and Warranties) of the Facility Agreement are true and
correct at the date hereof as if made with respect to the facts and
circumstances existing at such date;
(c) the borrowing to be effected by the drawdown of the Advance hereunder
will be within our powers, has been validly authorised by appropriate
action and will not cause any limit on our borrowings (whether imposed
by statute, regulation, agreement or otherwise) to be exceeded.
Words and expressions defined in the Facility Agreement shall have the same
meanings where used herein.
For and on behalf of
ASIA NETCOM CORPORATION LIMITED
[Facility Agreement]
-91-
[Schedule 3]
(CP Documents)
SCHEDULE 3
DOCUMENTS AND EVIDENCE REQUIRED AS
CONDITIONS PRECEDENT TO FIRST ADVANCE
1. Fully duly executed originals or counterparts or, in the case of the
Vendor Financing Security Documents, certified true copies, of each of-
(a) this Agreement;
(b) the Initial Group Debentures;
(c) the Guarantees
(d) the Initial Group Assignment of Insurances;
(e) the Initial Subordination Deeds;
(f) the Initial Share Mortgages;
(g) the Right of First Refusal Agreement;
(h) the Security Assignment of the Right of First Refusal
Agreement;
(i) the Charge Over Account;
(j) the Charge Over Deposit;
(k) the Vendor Financing Security Documents;
(l) the Deeds of Transfer, Release and Settlement;
(m) the Vendor Financing Transfer Documents;
(n) the Intercreditor Agreement;
(o) the Fee Letters; and
(p) all the other documents required to be executed and/or
delivered pursuant to the documents listed above, the Deeds of
Transfer, Release and Settlement and the Vendor Financing
Transfer Documents.
2. Legal opinion of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ as Hong Kong legal counsel to the
Lenders.
3. Legal opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ as the Bermuda legal counsel
to the Lenders.
[Facility Agreement]
-92-
[Schedule 3]
(CP Documents)
4. Legal opinions from Lenders' legal counsel in each jurisdiction in
which a Security Party is incorporated or in which any asset the
subject of a Security Document is situated if required by the Facility
Agent.
5. A copy of the constitutional documents of the Borrower and each other
Security Party a party to any of the documents listed in paragraph 1 of
this Schedule.
6. A copy of a resolution of the board of directors of the Borrower and
each other Security Party a party to any of the documents listed in
paragraph 1 of this Schedule approving the terms of, and the
transactions contemplated by the Finance Documents.
7. Subject to confirmation from legal counsel in the relevant jurisdiction
that such are required, a copy of a resolution of the shareholders of
the Borrower and each other Security Party approving the terms of, and
the transactions contemplated by the Finance Documents.
8. Each Authorised Signatory Certificate for the Borrower and each other
Security Party a party to any of the documents listed in paragraph 1 of
this Schedule substantially in the form of Schedule 4.
9. Evidence that all authorisations, if any, have been obtained and that
all necessary filings, registrations and other formalities, if any,
have been or will be completed or arrangement satisfactory to the
Facility Agent has been or will be made in order to ensure the Finance
Documents are valid and legally binding and enforceable.
10. Certified copy of the audited financial statements of the Borrower
Group for the year ended 31st March, 2003 (containing, among other
information, evidence of the injection of US$120,000,000 cash, in the
form of equity by the shareholders of the Borrower at 31st March 2003)
in form and substance satisfactory to the Facility Agent.
11. Hybrid Financial Pro-forma of the Borrower in respect of the financial
year ended 31st March, 2003 up to financial year ended 31st March,
2009.
12. A certified true copy of the documentation entered into between the
Borrower and AssetCo and various other Security Parties in respect of
transfer of shares in various Subsidiaries of the Borrower to AssetCo
and EAN or other evidence acceptable to the Facility Agent that the
transactions contemplated thereby have been consummated.
13. Evidence that all fees under Clauses 20.1 (Arrangement Fee), 20.2
(Agency Fee) and 20.3 (Commitment Fee) and 20.4 then due and payable
from the Security Parties under this Agreement have been or will be
paid by the time required under the provisions of this Agreement.
14. Evidence that the process agent referred to in Clause 25.5 (Process
Agent) and in the equivalent provisions of the other Finance Documents
has accepted its appointment.
15. Evidence satisfactory to the Finance Parties that all arrangements are
in place for the consummation of the transactions contemplated by the
Deeds of Transfer, Release and
[Facility Agreement]
-93-
[Schedule 3]
(CP Documents)
Settlement and the Vendor Financing Transfer Documents simultaneously
with the advance of the first Advance on the First Drawdown Date
including without limitation all payment flows and instructions between
the relevant parties thereto.
16. Certificates from the Borrower confirming, amongst other things, the
accuracy of information provided to the Facility Agent; no material
change in the information provided to the Facility Agent and its
advisers; approvals; no litigation; and no default, such Certificate
substantially in the form of Schedule 14.
17. Such other documents and evidence relating to any of the matters
contemplated herein as the Facility Agent may reasonably require.
[Facility Agreement]
-94-
[Schedule 4]
(Director's Certificate)
SCHEDULE 4
FORM OF AUTHORISED SIGNATORY CERTIFICATE
[Date]
To: Industrial and Commercial Bank of China (Asia) Limited
10/F, ICBC Asia Building
▇▇▇-▇▇▇ ▇▇▇▇▇'▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
and to each Finance Party
I refer to the facility agreement as amended and restated by the Supplemental
Amendment and Restatement Deed (the "FACILITY AGREEMENT") dated July, 2004,
between (1) Asia Netcom Corporation Limited as borrower (the "BORROWER"); (2)
the lenders named therein (the "LENDERS"), (3) Industrial and Commercial Bank of
China (Asia) Limited as facility agent for the Lenders, and (4) Industrial and
Commercial Bank of China (Asia) Limited as arranger in relation to a loan
facility in the maximum aggregate amount of up to US$150,000,000 to be made
available on the terms and conditions set out therein. Terms defined in the
Facility Agreement have the same meaning when used in this Certificate unless
otherwise defined in this Certificate.
I am an authorised signatory of [NB: INSERT NAME OF RELEVANT SECURITY PARTY]
(the "COMPANY") and hereby certify as follows:-
1. I am duly authorised to give this Certificate.
2. POWERS: Delivered with this Certificate and signed or initialled by me
for the purpose of identification is a true, complete and up-to-date
copy of the [Certificate of Incorporation and Memorandum of Association
and [constitutional documents]] Bye-laws of the Company as in effect
when it signed [the Facility Agreement and] the Finance Documents to
which it is a party on the date of this Certificate. The Company is
carrying on a business authorised under its [constitutional documents].
Neither the entry into of [the Facility Agreement and] the Finance
Documents to which it is a party by the Company, nor the exercise of
its rights and/or performance of or compliance with its obligations
thereunder does or will violate, or exceed any borrowing or other power
or restriction granted or imposed by its [Memorandum of Association and
Bye-Laws [constitutional documents]] and at the date of this
Certificate the Company is solvent.
3. DUE AUTHORISATION: Delivered with this Certificate and signed or
initialled by me for the purpose of identification is a true and
complete copy of (i) the minutes of a duly convened meeting of the
board of directors * of the Company duly held at which a duly
constituted quorum was present throughout and at which the resolutions
set out in the minutes were duly passed and (ii) the written
resolutions of the shareholders of
-------------------------
* [if legal counsel in the relevant jurisdiction confirm that such are required]
[Facility Agreement]
-95-
[Schedule 4]
(Director's Certificate)
the Company duly passed. Each of those resolutions remains in full
force and effect without modification. Those resolutions constitute all
actions necessary on the part of the Company to approve the [Facility
Agreement and] the Finance Documents to which it is a party and to
authorise the signing or execution of, under hand or under seal, [the
Facility Agreement and] the Finance Documents to which it is a party
and the giving of any notices or other communications and/or taking of
any other actions required thereunder or in connection therewith on
behalf of the Company.
4. DUE EXECUTION: [The Facility Agreement and] the Finance Documents to
which it is a party have been unconditionally signed or executed and
delivered by the Company. The person(s) who signed the [Facility
Agreement and the Finance Documents to which it is a party] on behalf
of the Company was/were duly authorised signatory(ies) of the Company
when the same was entered into. Delivered with this Certificate is a
list of the name(s) and title(s) and specimen(s) of the signature(s) of
the person(s) who is/are at the date of this Certificate directors of
the Company or who (either individually or with others, as provided in
the resolutions referred to in 3 above) are authorised to sign [the
Facility Agreement and] the Finance Documents to which the Company is a
party and/or is/are authorised to give all notices and other
communications and take any other actions required thereunder or in
connection therewith on behalf of the Company.
NAME: _______________________________
AUTHORISED SIGNATORY
[Facility Agreement]
-96-
[COMPANY]
SPECIMEN SIGNATURES
Name Title Specimen Signature
[Facility Agreement]
-97-
[Schedule 5]
(Form of Transfer Certificate)
SCHEDULE 5
FORM OF TRANSFER CERTIFICATE
[Date]
To: Industrial and Commercial Bank of China (Asia) Limited
10/F, ICBC Asia Building
▇▇▇-▇▇▇ ▇▇▇▇▇'▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
as Facility Agent
From: [Name of Existing Lender] and [Name of Transferee]
TRANSFER CERTIFICATE
Relating to the facility agreement as amended and restated by the Supplemental
Amendment and Restatement Deed (and as from time to time further amended,
varied, novated or supplemented) (the "AGREEMENT") whereby a term loan facility
of up to US$150,000,000 was made available to Asia Netcom Corporation Limited
(the "BORROWER") by a group of banks and other financial institutions on whose
behalf Industrial and Commercial Bank of China (Asia) Limited (the "FACILITY
AGENT") acted as agent in connection therewith. Words and expressions defined in
the Agreement shall have the same meanings when used in this Transfer
Certificate.
1. [Name of Existing Lender] (the "EXISTING LENDER") (a) confirms the
accuracy of the summary of its participation in the Agreement set out
in the Schedule below; and (b) requests [Name of Transferee] (the
"TRANSFEREE") to accept and procure the novation of the portion of such
participation specified in the Schedule below by countersigning and
delivering this Transfer Certificate to the Facility Agent at its
address for the service of notices specified in the Agreement.
2. The Transferee hereby requests the Facility Agent (on behalf of itself,
the Borrower and the Lenders) to accept this Transfer Certificate as
being delivered to the Facility Agent pursuant to and for the purposes
of Clause 18.4 (Transfer Certificates) of the Agreement so as to take
effect as a novation of the rights and obligations of the Existing
Lender to the extent of the portion of the Existing Lender's
participation referred to in paragraph 1 above in accordance with the
terms of the Agreement on [date of transfer*] (the "TRANSFER DATE").
[*NOTE.- To be not earlier than [5] Business Days after the date of
delivery of this Transfer Certificate to the Facility Agent.]
3. The Transferee confirms that:-
(a) it has received a copy of the Agreement, the Security
Documents and all other documentation and information required
by it in connection with the transaction contemplated by this
Transfer Certificate;
[Facility Agreement]
-98-
[Schedule 5]
(Form of Transfer Certificate)
(b) it has not relied on any statement, opinion, forecast or other
representation made by the Facility Agent to induce it to
execute this Transfer Certificate and has made, without
reliance on the Facility Agent and based on such documents as
it considers appropriate, its own appraisal of the
creditworthiness of the Borrower and its own independent
investigation of the financial condition and affairs of the
Borrower in connection with the assumption by the Transferee
of its obligations arising under or by virtue of this Transfer
Certificate.
4. The Existing Lender makes no representation or warranty and assumes no
responsibility with respect to the legality, validity, effectiveness,
adequacy or enforceability of the Agreement or any document relating
thereto and assumes no responsibility for the financial condition of
the Borrower or any other party to the Agreement or the Security
Documents or for the performance and observance by the Borrower or any
other such party of any of their respective obligations under the
Agreement or the Security Documents or any document relating thereto
and any and all such conditions and warranties, whether express or
implied by law or otherwise, are hereby excluded. The Transferee
acknowledges that it has not relied on any statement, opinion, forecast
or other representation made by the Existing Lender to induce it to
enter into this Agreement and that it has made and will continue to
make without reliance on the Existing Lender and based on such
documents as it considers appropriate its own appraisal of the
creditworthiness of the Borrower and the Group and its own independent
investigation of the financial condition and affairs of the Borrower
and the Group in connection with the Agreement.
5. This Transfer Certificate and the rights and obligations of the parties
hereunder are governed by and shall be construed in accordance with the
laws of England.
THE SCHEDULE
1. The Existing Lender's participation
(a) The Existing Lender's Commitment US$_____________
(b) The Existing Lender's Outstandings US$_____________
2. The portion of the amount in 1 above to be novated
(a) US$
(b) US$
[Facility Agreement]
-99-
[Schedule 5]
(Form of Transfer Certificate)
Administrative Details of the Transferee
Lending Office:
Account for Payments:
Fax:
Attention:
[Name of Existing Lender] [Name of Transferee]
By:____________________________________ By:_________________________________
Date: Date:
THE FACILITY AGENT
Industrial and Commercial Bank of China (Asia) Limited
By:______________________________________
on its own behalf
and on behalf of
the Borrower and the Lenders
[Facility Agreement]
-100-
[Schedule 6]
(Vendor Financing)
SCHEDULE 6
VENDOR FINANCING
NEC
(a) Project Development and Construction Contract between East Asia
Crossing Ltd and NEC dated October 13, 2000 and supplemented by a
payment deferral loan agreement dated March 29, 2002 (the "NEC PDA") as
amended by an amendment No. 1 to the NEC PDA dated May 14, 2002 and
amendment No.2 to the NEC PDA dated November 16, 2002 and amendment
No.3 to the NEC PDA dated March 10, 2003; and
(b) the documents listed in Schedule 3 of the NEC PDA; and.
(c) all documents relating to the creation of security interests in certain
assets related to the business of the Borrower in Taiwan.
KDDI
(a) Project Development and Construction Contract between East Asia
Crossing Ltd and KDDI originally dated December 17, 1999 as amended and
restated on July 28, 2000 and supplemented by a payment deferral option
agreement dated as of March 25, 2002 (the "KDDI PDA") as amended by an
amendment No. 1 to the KDDI PDA dated May 14, 2002 (the "Amendment No.
1 to the Payment Deferral Option Agreement") and amendment No. 2 to the
KDDI PDA dated as of November 15, 2002 and amendment No.3 dated January
2, 2003.
(b) the Security Agreements referred to in Exhibit E of KDDI PDA; and
(c) all documents relating to the creation of security interests in certain
assets related to the business of the Borrower in Taiwan.
[Facility Agreement]
-101-
[Schedule 7]
(Consents)
SCHEDULE 7
CONSENTS
Each of the consents, approvals, registrations, permits and licenses mentioned
in the legal opinions referred to in paragraphs 2, 3 and 4 of Schedule 3 to this
Agreement.
[Facility Agreement]
-102-
[Schedule 8]
(Financial Covenants)
SCHEDULE 8
FINANCIAL COVENANTS
1. The Borrower undertakes and agrees with the Facility Agent and the
Lenders that the Borrower will, unless the Facility Agent otherwise
agrees in writing, ensure that the financial condition of the Borrower
Group is such that on each Financial Covenant Test Date:-
(a) commencing from 1st January, 2005, the ratio of Total Capital
Expenditure for the immediately preceding 12 months period to
Total Revenue for the immediately preceding 12 months period
is equal to or less than 1.4:10;
(b) commencing from 1st January, 2005 and subject to Clause 3(a)
of this Schedule 8, the Debt Service Coverage Ratio for the
then next 6 months is equal to or more than 1:1;
(c) commencing from 1st January, 2006, the ratio of EBITDA for the
immediately preceding 12 months period (excluding OA & M
Expenses not exceeding US$35,000,000) to Total Revenue for the
immediately preceding 12 months period is equal to or more
than 1:5;
(d) subject to Clause 3(b) of this Schedule 8:-
(i) commencing from 1st January, 2006 for the period up
to and including 31st December, 2006, the ratio of
Net Debt for the immediately preceding 12 months
period to EBITDA for the immediately preceding 12
months period is equal to or less than 10:1; and
(ii) commencing from 1st January, 2007, the ratio of Net
Debt for the immediately preceding 12 months period
to EBITDA for the immediately preceding 12 months
period is equal to or less than 2.5:1;
(e) subject to Clause 3(c) of this Schedule 8, commencing from 1st
January, 2006, the ratio of EBITDA for the immediately
preceding 3 months period to Interest Expense for the
immediately preceding 3 months period is equal to or more than
2.5:1.
2. The Borrower undertakes and agrees with the Facility Agent and the
Lenders that the Borrower will ensure that the Borrower Group, unless
the Facility Agent otherwise agrees in writing, shall at each Financial
Year end listed in column 1 hereunder achieve the IRU Cash Revenue and
OA&M Cash Revenue and Service Revenue targets set out in Columns 2 and
3 respectively below opposite such Financial Year end by reference to
the financial statements for such Financial Year delivered in
accordance with this Agreement to the Lenders:-
[Facility Agreement]
-103-
[Schedule 8]
(Financial Covenants)
Column 1 Column 2 Column 3
IRU OA&M CASH
CASH REVENUE AND
PERIOD REVENUE SERVICE REVENUE
------------------------------- ------------- ---------------
For the Financial Year ended 31 US$20,000,000 US$143,300,000
December 2004
For the Financial Year ended 31 US$25,000,000 US$185,500,000
December 2005
For the Financial Year ended 31 US$30,000,000 US$253,400,000
December 2006
For the Financial Year ended 31 US$30,000,000 US$350,600,000
December 2007
For the Financial Year ended 31 US$30,000,000 US$473,400,000
December 2008
3. If the Borrower, at any time, declares or pays any dividends or makes
any other distribution (whether of an income or capital nature)
pursuant to Clause 16.7 (Dividends), it shall ensure that the financial
condition of the Borrower Group is such that: :-
(a) the Debt Service Coverage Ratio for the then next 12 months
from the date of such declaration or making of such
distribution is equal to or more than 2:1;
(b) from the date of such declaration or making of such
distribution until the Final Maturity Date, the ratio of Net
Debt to EBITDA is at all times equal to or less than 2.5:1;
and
(c) from the date of such declaration or making of such
distribution until the Final Maturity Date, the ratio of
EBITDA to Gross Interest is at all times equal to or more than
4:1.
For the purposes of calculating any of the financial ratios in this Schedule 8,
any amount outstanding or payable in a currency other than US Dollars shall on
that day be taken into account:
(i) if an audited consolidated balance sheet of a member of the Borrower
Group has been prepared as at that day, in their US Dollar equivalent
at the rate of exchange used for the purpose of preparing that balance
sheet; and
(ii) in any other case, in their US Dollar equivalent at the rate of
exchange that would have been used had an audited consolidated balance
sheet of the Borrower Group been prepared as at that day in accordance
with US GAAP; and
All terms and expressions used in this Schedule 8 are to be calculated and
interpreted in accordance with US GAAP.
[Facility Agreement]
-104-
[Schedule 9]
(Confirmation of IPO Proceeds)
SCHEDULE 9
CONFIRMATION OF IPO PROCEEDS
To: The Facility Agent
From: The Borrower
We refer to a facility agreement as amended and restated by the Supplemental
Amendment and Restatement Deed (the "FACILITY AGREEMENT"), and made between Asia
Netcom Corporation Limited, as Borrower, Industrial and Commercial Bank of China
(Asia) Limited as Facility Agent, and the financial institutions listed therein
as Lenders. Terms defined in the Facility Agreement shall have the same meanings
in this IPO Confirmation Notice.
We confirm that:-
(i) we have received IPO Net Proceeds in an amount equal to [ ]; and
(ii) at the date hereof the representations set out in Clause 15
(Representations and Warranties) of the Facility Agreement are true and
correct and no Default has occurred and is continuing.
Yours faithfully,
For and on behalf of
ASIA NETCOM CORPORATION LIMITED
[Facility Agreement]
-105-
[Schedule 10]
(Form of Hybrid Financial Statements/Proformas)
SCHEDULE 10
FORM OF HYBRID FINANCIAL STATEMENTS AND
HYBRID FINANCIAL PRO-FORMAS
PART A
ANC Annual Hybrid US GAAP and Cash Financial Proforma
$millions Q1 Q2 Q3 Q4
-------------------------------------------------------------------------------------------------------------
Cash Revenue
Restricted Cash IRU
OA&M Revenue
Services
Total Revenue
Expenses
Cash Operating Expenses
OA&M Expenses
Services Cost of Access
Total Expense
Capex/Overhang
Backhaul/Offnet Overhang
New IRU Backhaul
PCL Overhang
Services
NEC/KDDI Contracts
Other Capex
Total Capex/Overhang
Other Expenses/(Income)
Other Expenses/(Income)
Net Interest
Total Other Expense/(Income)
Net Cash Flow
Beginning Cash Balance
Net Cash Flow
Ending Cash Balance
[Facility Agreement]
-106-
[Schedule 10]
(Form of Hybrid Financial Statements/Proformas)
PART B
ANC Quarterly Hybrid US GAAP and Cash Financial Statement
$millions Q4 2003
----------------------------------------------------------------------------------------
Cash Revenue
Restricted Cash IRU
OA&M Revenue
Services
Total Revenue
Expenses
Cash Operating Expenses
OA&M Expenses
Services Cost of Access
Total Expense
Capex/Overhang
Backhaul/Offnet Overhang
New IRU Backhaul
PCL Overhang
Services
NEC/KDDI Contracts
Other Capex
Total Capex/Overhang
Other Expenses/(Income)
Other Expenses/(Income)
Net Interest
Total Other Expense/(Income)
Net Cash Flow
Beginning Cash Balance
Net Cash Flow
Ending Cash Balance
[Facility Agreement]
-107-
[Schedule 11]
(Debentures)
SCHEDULE 11
DEBENTURES
Security Documents to be granted by the following Security Parties in favour of
the Security Trustee:
COLUMN 1 COLUMN 2 COLUMN 2
JURISDICTION OF
NO SECURITY PARTY DOCUMENT SECURITY PARTY
--------------------------------------------------------------------------------------------------------------------
1. ASIA NETCOM ASIA PACIFIC LIMITED HONG KONG GROUP DEBENTURE HONG KONG
2. ASIA NETCOM ASIA PACIFIC HONG KONG GROUP DEBENTURE HONG KONG
COMMERCIAL LIMITED
3. ASIA NETCOM CORPORATION LIMITED DEBENTURE BERMUDA
4. ASIA NETCOM CORPORATION (SINGAPORE) SINGAPORE GROUP DEBENTURE SINGAPORE
PTE. LTD.
5. ASIA NETCOM HONG KONG LIMITED HONG KONG GROUP DEBENTURE HONG KONG
6. ASIA NETCOM SERVICES (S) PTE. LTD. SINGAPORE GROUP DEBENTURE SINGAPORE
7. ASIA NETCOM SINGAPORE PTE. LTD. SINGAPORE GROUP DEBENTURE SINGAPORE
8. EAST ASIA NETCOM LTD. DEBENTURE BERMUDA
9. GROUP WEALTH FINANCE LIMITED DEBENTURE BVI
10. SOUTHEAST ASIA NETCOM SINGAPORE GROUP DEBENTURE SINGAPORE
(SINGAPORE) PTE. LTD.
11. ASIA NETCOM AUSTRALIA PTY LTD. DEBENTURE AUSTRALIA
12. ASIA NETCOM JAPAN CORP. MOVABLES SECURITY ASSIGNMENT JAPAN
13. ASIA NETCOM SINGAPORE PTE. LTD. ASSIGNMENT OF BUILDING SINGAPORE
AGREEMENT
14. ASIA NETCOM TSUSHIN CORP. MOVABLES SECURITY ASSIGNMENT JAPAN
15. ASIA NETCOM USA, INC. SECURITY AGREEMENT USA
[Facility Agreement]
-108-
[Schedule 11]
(Debentures)
16. EAST ASIA NETCOM JAPAN LTD. MOVABLES SECURITY ASSIGNMENT JAPAN
/ MOVABLES PLEDGE
17. EAST ASIA NETCOM PHILIPPINES, INC. CHATTEL MORTGAGE PHILIPPINES
[Facility Agreement]
-109-
[Schedule 12]
(Share Mortgages)
SCHEDULE 12
SHARE MORTGAGES
SHARE MORTGAGES TO BE GRANTED BY THE FOLLOWING SECURITY PARTIES IN FAVOUR OF
THE SECURITY
COLUMN 1 COLUMN 2 COLUMN 2 COLUMN 4
JURISDICTION
COMPANIES WHOSE SHARES ARE THE OF
SUBJECT OF THE SHARE CHARGE - SECURITY
NO. (JURISDICTION) SECURITY PARTY PARTY DOCUMENT
--------------------------------------------------------------------------------------------------------------------
1. Asia Netcom Asia Pacific Commercial ASIA NETCOM CORPORATION BERMUDA HK GROUP SHARE MORTGAGE
Limited - (Hong Kong) LIMITED
2. Asia Netcom Asia Pacific Limited ASIA NETCOM CORPORATION BERMUDA HK GROUP SHARE MORTGAGE
- (Hong Kong) LIMITED
3. Asia Netcom Corporation Limited CHINA NETCOM BERMUDA ANC SHARE MORTGAGE
- (Bermuda) INTERNATIONAL LIMITED
4. Asia Netcom Corporation (Singapore) ASIA NETCOM CORPORATION BERMUDA SINGAPORE GROUP SHARE
Pte Limited - (Singapore) LIMITED MORTGAGE
5. Asia Netcom Hong Kong Limited ASIA NETCOM CORPORATION BERMUDA HK GROUP SHARE MORTGAGE
- (Hong Kong) LIMITED
6. Asia Netcom Korea Ltd. ASIA NETCOM CORPORATION SINGAPORE SHARE PLEDGE
- (Korea) (SINGAPORE) PTE. LIMITED
7. Asia Netcom Services (S) Pte. Ltd. ASIA NETCOM CORPORATION SINGAPORE SINGAPORE GROUP SHARE
- (Singapore) (SINGAPORE) PTE. LIMITED MORTGAGE
8. Asia Netcom Singapore Pte. Ltd. ASIA NETCOM CORPORATION SINGAPORE SINGAPORE GROUP SHARE
- (Singapore) (SINGAPORE) PTE. LIMITED MORTGAGE
9. East Asia Netcom Korea Limited. EAST ASIA NETCOM UK ENGLAND SHARE PLEDGE AGREEMENT
- (Korea) HOLDINGS LIMITED
10. East Asia Netcom Ltd. ASSETCO BVI EAN SHARE MORTGAGE
- (Bermuda)
11 East Asia Netcom EAST ASIA NETCOM LTD. BERMUDA SHARE MORTGAGE
UK Holdings Limited
- (England)
[Facility Agreement]
-110-
[Schedule 12]
(Share Mortgages)
12 Group Wealth Finance Limited (BVI) EAST ASIA NETCOM LTD. BERMUDA SHARE MORTGAGE
13 Southeast Asia Netcom ASIA NETCOM SINGAPORE SINGAPORE SINGAPORE GROUP SHARE
(Singapore) Pte. Ltd. PTE. LTD. MORTGAGE
- (Singapore)
14. Asia Netcom Australia Pty Ltd. ASIA NETCOM CORPORATION SINGAPORE SHARE MORTGAGE
- (Australia) (SINGAPORE) PTE. LIMITED
15. Asia Netcom Japan Corp. ASIA NETCOM CORPORATION SINGAPORE EQUITY UNIT PLEDGE
- (Japan) (SINGAPORE) PTE. LIMITED AGREEMENT
16. Asia Netcom Tsushin Corp. ASIA NETCOM CORPORATION SINGAPORE EQUITY UNIT PLEDGE
- (Japan) (SINGAPORE) PTE. LIMITED AGREEMENT
17. Asia Netcom USA, Inc. ASIA NETCOM CORPORATION SINGAPORE STOCK PLEDGE AGREEMENT
- (USA) (SINGAPORE) PTE. LIMITED
18. East Asia Netcom Japan Ltd. EAST ASIA NETCOM UK ENGLAND EQUITY UNIT PLEDGE
- (Japan) HOLDINGS LIMITED
[Facility Agreement]
-111-
[Schedule 13]
(Subordination Deeds)
SCHEDULE 13
SUBORDINATION DEEDS
[Facility Agreement]
-112-
[Schedule 14]
(Bring Down Certificate)
SCHEDULE 14
BORROWER'S BRINGDOWN CERTIFICATE
______________, 2004
To: Industrial and Commercial Bank of China (Asia) Limited
10/F, ICBC Asia Building
▇▇▇-▇▇▇ ▇▇▇▇▇'▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇
and to each Finance Party
I refer to the facility agreement as amended and restated by the Supplemental
Amendment and Restatement Deed (the "FACILITY AGREEMENT") dated July, 2004,
between (1) Asia Netcom Corporation Limited as borrower (the "BORROWER"); (2)
the lenders named therein (the "LENDERS"), (3) Industrial and Commercial Bank of
China (Asia) Limited as facility agent for the Lenders, and (4) Industrial and
Commercial Bank of China (Asia) Limited as arranger in relation to a loan
facility in the maximum aggregate amount of up to US$150,000,000 to be made
available on the terms and conditions set out therein.
Terms defined in the Facility Agreement have the same meaning when used in this
Certificate unless otherwise defined in this Certificate.
I am an authorised signatory of the Borrower and, pursuant to paragraph 16 of
Schedule 3 to the Facility Agreement, hereby certify as follows:-
INFORMATION: All information supplied to the Facility Agent or any other Finance
Party by or on behalf of the Borrower in respect of any member of the Borrower
Group under or in connection with the Finance Documents, including but not
limited to the Group Structure Chart and the audited accounts of the Borrower
Group for the year ended 31st March, 2003, is true, complete and accurate in all
material respects and not misleading in any material respect or does not omit
any material facts and all reasonable enquiries have been made to verify the
facts contained in the Finance Documents; and there are no other facts the
omission of which would make any fact or statement therein misleading in any
material respect nor there is any material adverse change in the financial
condition of the Borrower or the Borrower Group from the date when such
information was provided.
COMPLIANCE WITH CONSENTS AND LICENCES: every consent, authorisation, licence or
approval required for the time being by each member of the Borrower Group in
connection with the conduct of its business and the ownership, use, exploitation
or occupation of its property and assets has been applied for and not refused or
has been obtained and is in full force and effect and there has been no material
default in the observance of the conditions and restrictions (if any) imposed
on, or in connection with, any of the same which may have a material adverse
effect on the ability of each member of the Borrower Group to perform its
obligations under the Finance Documents to which it is party and, to the
knowledge of the officers of the Borrower, no circumstances have arisen whereby
any remedial action is likely to be required to be taken by, or at the expense
of, any member of the
[Facility Agreement]
-113-
[Schedule 14]
(Bring Down Certificate)
Borrower Group under or pursuant to any law or regulation applicable to the
business, property or assets of a member of the Borrower Group.
LITIGATION: except as disclosed in a letter of even date from the Borrower to
the Facility Agent, no litigation, arbitration or administrative proceeding is
currently taking place or pending or, to the knowledge of the officers of the
Borrower, threatened against the Borrower or any member of the Borrower Group or
any of their respective assets which could, in the reasonable opinion of the
Majority Lenders, materially and adversely affect its business, assets or
financial condition or their respective ability to perform its obligations under
the Finance Documents to which each is party.
NO DEFAULT: no Default has occurred and is continuing or might reasonably be
expected to result from the making of an Advance and no member of the Borrower
Group is or, with the giving of notice or lapse of time or satisfaction of any
other condition or any combination thereof, would be in material breach of or in
default under any agreement relating to Financial Indebtedness to which it is a
party or by which it may be bound.
_________________________________
FOR AND ON BEHALF OF
ASIA NETCOM CORPORATION LIMITED
AUTHORISED SIGNATORY
[Facility Agreement]
-114-
[Schedule 15]
(Group Structure Chart)
SCHEDULE 15
GROUP STRUCTURE CHART
[Facility Agreement]
-115-
[Schedule 15]
(Group Structure Chart)
[ASIA NETCOM CHART]
[Facility Agreement]
-116-
[Schedule 16]
(Initial Material Subsidiaries)
SCHEDULE 16
INITIAL MATERIAL SUBSIDIARIES
JURISDICTION OF
INITIAL MATERIAL SUBSIDIARIES INCORPORATION
--------------------------------------------------------------------------------------
ASIA NETCOM ASIA PACIFIC LIMITED HONG KONG
ASIA NETCOM ASIA PACIFIC COMMERCIAL LIMITED HONG KONG
ASIA NETCOM AUSTRALIA PTY LTD. AUSTRALIA
ASIA NETCOM CORPORATION LIMITED BERMUDA
ASIA NETCOM CORPORATION (SINGAPORE) PTE LTD. SINGAPORE
ASIA NETCOM HONG KONG LIMITED HONG KONG
ASIA NETCOM JAPAN CORP JAPAN
ASIA NETCOM KOREA LTD KOREA
ASIA NETCOM SERVICES (S) PTE LTD. SINGAPORE
ASIA NETCOM SINGAPORE PTE LTD. SINGAPORE
ASIA NETCOM TSUSHIN CORP JAPAN
ASIA NETCOM USA INC USA
EAST ASIA NETCOM LTD. BERMUDA
EAST ASIA NETCOM JAPAN LTD. JAPAN
EAST ASIA NETCOM KOREA LIMITED KOREA
EAST ASIA NETCOM PHILIPPINES, INC. PHILIPPINES
EAST ASIA NETWORK TAIWAN INC. TAIWAN
EAST ASIA NETCOM UK HOLDINGS LIMITED ENGLAND
GROUP WEALTH FINANCE LIMITED BVI
SOUTHEAST ASIA NETCOM (SINGAPORE) PTE LTD SINGAPORE
[Facility Agreement]
-117-
[Schedule 17]
(Documents required to be delivered by an Additional Security Party)
SCHEDULE 17
DOCUMENTS REQUIRED TO BE DELIVERED BY AN
ADDITIONAL SECURITY PARTY
1. A certified true copy of the constitutional documents of the Additional
Security Party.
2. A certified true copy of a resolution of the board of directors and the
shareholders of the Additional Security Party:
(a) approving the terms of, and the transactions contemplated by,
the Finance Documents and resolving that it execute the
Finance Documents to which it is a party;
(b) authorizing a specified person to execute such Finance
Documents; and
(c) authorizing a specified person, on its behalf, to sign and
deliver all other documents and notices to be signed and/or
delivered by it under or in connection with the Finance
Documents.
3. A specimen of the signature of each person referred to in paragraph 2.
above.
4. A copy of any other authorization or other document, opinion, or
assurance which the Facility Agent considers to be necessary or
desirable in connection with the entry into and performance of the
transactions contemplated by such Finance Documents, or for the
validity and enforceability of such Finance Documents.
5. Legal opinions from legal advisers in all relevant jurisdictions as
required by the Facility Agent.
[Facility Agreement]
-118-
[Schedule 18]
(Security Perfection Requirements)
SCHEDULE 18
SECURITY PERFECTION REQUIREMENTS
PART A PERFECTION OF SECURITY REQUIREMENTS WITHIN 1 BUSINESS DAY OF THE DATE Checklist
OF EXECUTION Item No.
BERMUDA
SHARE MORTGAGE OVER SHARES IN NEWCO GRANTED BY EAN - submit original of A -II1A2(ii)
the Share Mortgage to the Registrar of Companies in Bermuda for
registration.
THIRD PRIORITY DEBENTURE OVER ASSETS OF EAN - submit original of the A - II1A3(b)
Third Priority Debenture to the Registrar of Companies in Bermuda for
registration
DEBENTURE OVER ASSETS OF THE BORROWER - submit original of the A - II1B1
Debenture to the Registrar of Companies in Bermuda for registration
CHARGE OVER DEPOSIT GRANTED BY THE BORROWER - submit original of the A - II1B7(b)
Charge over Deposit to the Registrar of Companies in Bermuda for
registration
DEED OF ACCOUNT CHARGE GRANTED BY THE BORROWER - submit original of the A - II1B9(b)
Deed of Account Charge to the Registrar of Companies in Bermuda for
registration
SHARE MORTGAGE OVER SHARES IN THE BORROWER GRANTED BY CNC INTERNATIONAL A - II1C1(i)
- submit original of the Share Mortgage to the Registrar of Companies
in Bermuda for registration
SECOND DEED OF MORTGAGE OVER SHARES IN EAN - submit original of the A - II7A1(c)
Second Deed of Mortgage to the Registrar of Companies in Bermuda for
registration
ASSIGNMENT OF FIXED AND FLOATING CHARGE OVER ASSETS OF EAN FROM KDDI TO B - II1A1(b)
NEWCO - submit original of the Assignment together with Form 9 (revised
particulars) to Registrar of Companies in Bermuda
ASSIGNMENT OF FIXED AND FLOATING CHARGE OVER ASSETS OF EAN FROM NEC TO B - II1A2(b)
NEWCO - submit original of the Assignment together with Form 9 (revised
particulars) to Registrar of Companies in Bermuda
ASSIGNMENT OF SHARE CHARGE GRANTED BY EAST ASIA NETCOM UK HOLDINGS B - II1A3(d)
LIMITED OVER SHARES OF EAN FROM DB TRUSTEES TO NEWCO - submit original
of the Assignment together with Form 9 (revised particulars) to
Registrar of Companies in Bermuda
[Facility Agreement]
-119-
[Schedule 18]
(Security Perfection Requirements)
DEED OF ASSIGNMENT OF CHARGE GRANTED BY ASSETCO OVER SHARES OF EAN FROM B - II7A1(b)
DB TRUSTEES TO NEWCO - submit original Deed of Assignment together with
Form 9 (revised particulars) to Registrar of Companies in Bermuda
BVI
SECOND DEED OF MORTGAGE OVER SHARES IN EAST ASIA NETCOM LIMITED - A - II7A1(b)(i)
Registration of Second Deed of Mortgage on AssetCo's Register of
Mortgages
DEBENTURE OVER ASSETS OF NEWCO - Registration of Debenture on NewCo's A - II7B1(a)(i)
Register of Mortgages
SHARE PLEDGE AGREEMENT to be given by ASIA NETCOM CORPORATION
(SINGAPORE) PTE. LTD. [3020] (SINGAPORE) over shares in ASIA NETCOM
JAPAN CORP. AND ASIA NETCOM TSUSHIN CORP.
- entry of the pledge interest in the shareholders register of Asia A - II5a5(b)
Netcom Japan Corp.
- entry of the pledge interest in the shareholders register of Asia A - II5a5(b)
Netcom Tsushin Corp.
JAPAN
TRANSFER OF PLEDGE OF MOVABLES GRANTED BY EAST ASIA NETCOM JAPAN B - II3A1(b)
LIMITED FROM KDDI TO NEWCO - affixation of official date stamp
(kakutei-hizuke) on the Confirmation and Consent to be given by Asia
Netcom Japan Corp (as possessor of movables)
TRANSFER OF PLEDGE OF MOVABLES GRANTED BY EAST ASIA NETCOM JAPAN B - II3A2(b)
LIMITED FROM NEC TO NEWCO - affixation of official date stamp
(kakutei-hizuke) on the Confirmation and Consent to be given by Asia
Netcom Japan Corp (as possessor of movables)
TRANSFER OF MORTGAGE GRANTED BY EAST ASIA NETCOM JAPAN LIMITED FROM
KDDI TO NEWCO
- entry in the property registry maintained by (a) Aji Branch of Tsu B - II3A3(b)
Local Legal Affairs Bureau with respect to the Ajigaura Property and
(b) Htachinaka Branch of Mito Local Legal Affairs Bureau with respect
to the Shima Property
- payment of governmental commission for the registration of the B - II3A3(c)
transfer of mortgage
TRANSFER OF MORTGAGE GRANTED BY EAST ASIA NETCOM JAPAN LIMITED FROM NEC
TO NEWCO
- entry in the property registry maintained by (a) Aji Branch of Tsu B - II3A4(b)
Local Legal Affairs Bureau with respect to the Ajigaura Property and
(b) Htachinaka Branch of Mito Local Legal Affairs Bureau with respect
to the Shima Property
[Facility Agreement]
-120-
[Schedule 18]
(Security Perfection Requirements)
- payment of governmental commission for the registration of the B - II3A3(c)
transfer of mortgage
TRANSFER OF EQUITY UNIT PLEDGE GRANTED BY EAST ASIA NETCOM UK HOLDINGS B - II6A2(d)
LIMITED OVER SHARES IN EAST ASIA NETCOM JAPAN LTD FROM KDDI TO NEWCO -
entry into the shareholders register of East Asia Netcom Japan Ltd
regarding the transfer of the pledge
TRANSFER OF EQUITY UNIT PLEDGE GRANTED BY EAST ASIA NETCOM UK HOLDINGS B - II6A3(d)
LIMITED OVER SHARES IN EAST ASIA NETCOM JAPAN LTD FROM NECTO NEWCO -
entry into the shareholders register of East Asia Netcom Japan Ltd
regarding the transfer of the pledge
KOREA
SHARE PLEDGE OVER SHARES IN ASIA NETCOM KOREA LTD GRANTED BY ASIA
NETCOM CORPORATION (SINGAPORE) PTE LTD
- affix official fixed date stamp on the acknowledgment and consent to A - II5A4 (b)
be given by Asia Netcom Korea Ltd
- submit application form to Asia Netcom Korea Ltd for the recordation A - II5A4 (d)
of the Lenders' pledge interest in Shareholders Registry of Asia Netcom
Korea Ltd.
ASSIGNMENT OF SHARE PLEDGE GRANTED BY EAST ASIA NETCOM UK HOLDINGS B - II6A1(a)
LIMITED OVER SHARES IN EAST ASIA NETCOM KOREA LTD FROM DB TRUSTEES AND
NEWCO - affix official fixed date stamp on the acknowledgment and
consent to be given by East Asia Netcom Korea Ltd
USA
STOCK PLEDGE AGREEMENT OVER SHARES IN ASIA NETCOM USA, INC. GRANTED BY A - II5A6(c)
ASIA NETCOM CORPORATION (SINGAPORE) PTE LTD AND SECURITY ASSIGNMENT - and A - II9A1
submit UCC filings in the State of Delaware against Asia Netcom USA,
Inc.
DEBENTURE OVER ASSETS OF THE BORROWER - submit UCC filings in A - II1B1
Washington DC against the Borrower
ASSIGNMENT OF FIXED AND FLOATING CHARGE OVER ASSETS OF EAN FROM KDDI TO B - II1A1(e)
NEWCO - submit UCC filings in Washington DC against EAN
PART B PERFECTION OF SECURITY REQUIREMENTS WITHIN 5 BUSINESS DAYS OF THE DATE
OF EXECUTION
KOREA
ASSIGNMENT OF SHARE PLEDGE OVER SHARES IN EAST ASIA NETCOM KOREA LTD. B - II6A1(b)
GRANTED BY EAST ASIA NETCOM UK HOLDINGS LIMITED FROM DB TRUSTEES TO
NEWCO - submit application form to East Asia Netcom Korea Ltd for the
recordation of the Lenders' pledge interest in Shareholders Registry of
East Asia Netcom Korea Ltd.
[Facility Agreement]
-121-
[Schedule 18]
(Security Perfection Requirements)
SECOND PRIORITY SHARE PLEDGE OVER SHARES IN EAST ASIA NETCOM KOREA LTD. A - II6A2(d)
GRANTED BY EAST ASIA NETCOM UK HOLDINGS LIMITED - submit application
form to East Asia Netcom Korea Ltd for the recordation of the Lenders'
second priority pledge interest in Shareholders Registry of East Asia
Netcom Korea Ltd.
PART C PERFECTION OF SECURITY REQUIREMENTS WITHIN 10 BUSINESS DAYS OF THE DATE
OF EXECUTION
BVI
SHARE MORTGAGE OVER SHARES IN NEWCO GRANTED BY EAN - entry of notation A - II1A2(i)
of Share Mortgage on NewCo's share register and filing of share
register with the BVI Companies Registry
SECOND DEED OF MORTGAGE OVER SHARES IN EAN - filing of AssetCo's A - II7A1(b)(ii)
Register of Mortgages with the BVI Companies Registry
DEBENTURE OVER ASSETS OF NEWCO - filing of NewCo's Register of A - II7B1(a)(ii)
Mortgages with the BVI Companies Registry
PART D PERFECTION OF SECURITY REQUIREMENTS WITHIN 14 DAYS OF THE DATE OF
EXECUTION
HONG KONG
DEED OF RELEASE OF CHARGE OVER SHARES IN ASIA NETCOM HONG KONG LIMITED B - III1A1
- submit Form M2 to Companies Registry of Hong Kong for registration.
KDDI DEED OF TRANSFER, SETTLEMENT AND RELEASE AND KDDI DEED OF B - III2A1
TRANSFER, SETTLEMENT AND RELEASE - submit Form M2 to Companies Registry
of Hong Kong for registration of the release of Fixed and Floating
Charge in Asia Netcom Hong Kong Limited granted in favour of KDDI.
NEC DEED OF TRANSFER, SETTLEMENT AND RELEASE AND KDDI DEED OF TRANSFER, B - III3A1
SETTLEMENT AND RELEASE - submit Form M2 to Companies Registry of Hong
Kong for registration of the release of Fixed and Floating Charge in
Asia Netcom Hong Kong Limited granted in favour of NEC.
JAPAN
KDDI DEED OF TRANSFER, RELEASE AND SETTLEMENT - KDDI to file an ex post B - IA(a)
notice with the Bank of Japan regarding the transfer of the portion of
the Vendor Financing from KDDI to NewCo.
NEC DEED OF TRANSFER, RELEASE AND SETTLEMENT - NEC to file an ex post B - IA(a)
notice with the Bank of Japan regarding the transfer of the portion of
the
[Facility Agreement]
-122-
[Schedule 18]
(Security Perfection Requirements)
Vendor Financing from NEC to NewCo.
PART E PERFECTION OF SECURITY REQUIREMENTS WITHIN 21 DAYS OF THE DATE OF
EXECUTION
ENGLAND
SECOND DEED OF MORTGAGE OVER SHARES IN EAST ASIA NETCOM UK HOLDINGS A - II 1A4(a)
LIMITED GRANTED BY EAN - submit original of the Second Deed of Mortgage
to Companies House for registration
ASSIGNMENT OF SHARE PLEDGE GRANTED BY EAST ASIA NETCOM UK HOLDINGS B - II6A1(d)
LIMITED OVER SHARES IN EAST ASIA NETCOM KOREA LIMITED FROM DB TRUSTEE
TO NEWCO - submit original of the Assignment of Share Pledge to
Companies House for registration
DEBENTURE OVER ASSETS OF EAST ASIA NETCOM UK HOLDINGS LIMITED - submit A - II6A1
original of the Debenture to Companies House for registration
SECOND PRIORITY SHARE PLEDGE GRANTED BY EAST ASIA NETCOM UK HOLDINGS A - II6A2(e)
LIMITED OVER SHARES IN EAST ASIA NETCOM KOREA LIMITED - submit original
of the Second Priority Share Pledge to Companies House for registration
THIRD PRIORITY EQUITY UNIT PLEDGE GRANTED BY EAST ASIA NETCOM UK A - II6A4(a)
HOLDINGS LIMITED OVER SHARES IN EAST ASIA NETCOM JAPAN LTD - submit
original of the Third Priority Equity Unit Pledge to Companies House
for registration
TRANSFER OF EQUITY UNIT PLEDGE GRANTED BY EAST ASIA NETCOM UK HOLDINGS B - II6A2(e)
LIMITED OVER SHARES IN EAST ASIA NETCOM JAPAN LTD FROM KDDI TO NEWCO -
submit original of the Transfer of Equity Unit Pledge to Companies
House for registration
TRANSFER OF EQUITY UNIT PLEDGE GRANTED BY EAST ASIA NETCOM UK HOLDINGS B - II6A3(e)
LIMITED OVER SHARES IN EAST ASIA NETCOM JAPAN LTD FROM NECTO NEWCO -
submit original of the Transfer of Equity Unit Pledge to Companies
House for registration
DEED OF ASSIGNMENT OF PLEDGE AGREEMENT GRANTED BY EAST ASIA NETCOM UK B - II6A4(c)
HOLDINGS LIMITED OVER SHARES IN EAST ASIA NETCOM PHILIPPINES, INC. -
submit original of the Deed of Assignment to Companies House for
registration
ALL OTHER SECURITY DOCUMENTS - submit original of all other Security
Documents to Companies House for registration.
JAPAN
TRANSFER OF MORTGAGE GRANTED BY EAST ASIA NETCOM JAPAN LIMITED FROM B - II3A3(d)
KDDI TO NEWCO - consent from landowner for the transfer of mortgage
[Facility Agreement]
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[Schedule 18]
(Security Perfection Requirements)
TRANSFER OF MORTGAGE GRANTED BY EAST ASIA NETCOM JAPAN LIMITED FROM NEC B - II3A4(d)
TO NEWCO - consent from landowner for the transfer of mortgage
PART F PERFECTION OF SECURITY REQUIREMENTS WITHIN 30 DAYS OF THE DATE OF
EXECUTION
SINGAPORE
GROUP DEBENTURE OVER ASSETS OF ASIA NETCOM CORPORATION (SINGAPORE) PTE A - II5A3(ae)
LTD, ASIA NETCOM SINGAPORE PTE. LTD, ASIA NETCOM SERVICES (S) PTE LTD,
AND SOUTHEAST ASIA NETCOM (SINGAPORE) PTE LTD. - submit Group Debenture
for stamping with the Inland Revenue Authority of Singapore
ASSIGNMENT OF BUILDING AGREEMENT BETWEEN ASIA NETCOM SINGAPORE PTE LTD A - II5B2(c)
AND ICBC ASIA - submit Assignment of Building Agreement for stamping
with the Inland Revenue Authority of Singapore
NEC DEED OF TRANSFER, SETTLEMENT AND RELEASE AND RELEASE OF SHARE B - II3B1
CHARGE OVER SHARES IN ASIA NETCOM SINGAPORE PTE LTD - submit
notification to the Accounting and Corporate Regulatory Authority
regarding the release of the Share Charge
NEC DEED OF TRANSFER, SETTLEMENT AND RELEASE AND RELEASE OF SHARE B -II3B3
CHARGE OVER FUTURE SHARES IN ASIA NETCOM SINGAPORE PTE LTD - submit
notification to the Accounting and Corporate Regulatory Authority
regarding the release of the future Share Charge
NEC DEED OF TRANSFER, SETTLEMENT AND RELEASE AND RELEASE OF DEBENTURE B -II3B3
OVER ASSETS PF ASIA NETCOM SINGAPORE PTE LTD - submit notification to
the Accounting and Corporate Regulatory Authority regarding the release
of the Debenture
NEC DEED OF TRANSFER, SETTLEMENT AND RELEASE AND RELEASE OF ASSIGNMENT B -II3B10
OF BUILDING AGREEMENT - submit notification to the Accounting and
Corporate Regulatory Authority regarding the release of the Assignment
of Building Agreement
NEC DEED OF TRANSFER, SETTLEMENT AND RELEASE AND RELEASE OF ASSIGNMENT B - II3B7
OF BUILDING AGREEMENT - notice of release and reassignment to Jurong
Town Corporation
NEC DEED OF TRANSFER, SETTLEMENT AND RELEASE AND RELEASE OF ASSIGNMENT B - II3B8
OF BUILDING AGREEMENT - withdrawal of previous caveat lodged with
respect of the Assignment of Building Agreement
NEC DEED OF TRANSFER, SETTLEMENT AND RELEASE AND RELEASE OF DEBENTURE B -II3B11
OVER ASSETS PF SOUTHEAST ASIA NETCOM (SINGAPORE) PTE LTD - submit
notification to the Accounting and Corporate Regulatory Authority
regarding the release of the Debenture
[Facility Agreement]
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[Schedule 18]
(Security Perfection Requirements)
PART G PERFECTION OF SECURITY REQUIREMENTS WITHIN 5 WEEKS OF THE DATE OF
EXECUTION
HONG KONG
GROUP SHARE MORTGAGE OVER SHARES IN ASIA NETCOM ASIA PACIFIC LIMITED, A - II 1B3(y)
ASIA NETCOM ASIA PACIFIC COMMERCIAL LIMITED AND ASIA NETCOM HONG KONG
LIMITED GRANTED BY THE BORROWER - submit original of the Group Share
Mortgage to Companies Registry of Hong Kong for registration
CHARGE OVER DEPOSIT GRANTED BY THE BORROWER - submit original of the A - II 1B7(c)
Charge over Deposit to the Companies Registry of Hong Kong for
registration
DEED OF ACCOUNT CHARGE GRANTED BY THE BORROWER - submit original of the A - II 1B9(c)
Deed of Account Charge to the Companies Registry of Hong Kong for
registration
GROUP DEBENTURE OVER ASSETS OF ASIA NETCOM ASIA PACIFIC LIMITED, ASIA A - II 2A(a)
NETCOM ASIA PACIFIC COMMERCIAL LIMITED AND ASIA NETCOM HONG KONG
LIMITED - submit original of the Group Debenture to Companies Registry
of Hong Kong for registration
ALL OTHER SECURITY DOCUMENTS - submit original of all other Security
Documents to the Companies Registry of Hong Kong for registration.
PART H PERFECTION OF SECURITY REQUIREMENTS WITHIN 37 DAYS OF THE DATE HEREOF
SINGAPORE
GROUP DEBENTURE OVER ASSETS OF ASIA NETCOM CORPORATION (SINGAPORE) PTE A - II5A3(ad)
LTD, ASIA NETCOM SINGAPORE PTE. LTD, ASIA NETCOM SERVICES (S) PTE LTD,
AND SOUTHEAST ASIA NETCOM (SINGAPORE) PTE LTD. - lodgement of the
Statement Containing Particulars of Charge with the Accounting and
Corporate Regulatory Authority
ASSIGNMENT OF BUILDING AGREEMENT BETWEEN ASIA NETCOM SINGAPORE PTE LTD A - II5B2(b)
AND ICBC ASIA - lodgement of the Statement Containing Particulars of
Charge with the Accounting and Corporate Regulatory Authority
PART I NOTICES OF ASSIGNMENT AND ACKNOWLEDGMENTS AND OTHER CONSENTS (IF ANY)
REQUIRED TO BE RECEIVED UNDER ALL RELEVANT SECURITY DOCUMENTS
- execution and delivery of all notices of assignment and
acknowledgment and other consents (if any) within the time limit
specified under the relevant Security Document.
[Facility Agreement]
-125-
EXECUTION PAGE
THE BORROWER
SIGNED by )
)
)
for and on behalf of )
ASIA NETCOM CORPORATION LIMITED )
THE LENDERS
SIGNED by )
)
)
for and on behalf of )
THE INDUSTRIAL AND COMMERCIAL )
BANK OF CHINA, BEIJING BRANCH )
SIGNED by )
)
)
for and on behalf of )
THE INDUSTRIAL AND COMMERCIAL )
BANK OF CHINA, SHANGHAI BRANCH )
SIGNED by )
)
)
for and on behalf of )
THE INDUSTRIAL AND COMMERCIAL )
BANK OF CHINA, HONG KONG BRANCH )
[Facility Agreement]
-126-
SIGNED by )
)
)
for and on behalf of )
CHINA MINSHENG BANKING )
CORP. LTD. )
SIGNED by )
)
)
for and on behalf of )
CITIC INDUSTRIAL BANK )
SIGNED by )
)
)
for and on behalf of )
BANK OF COMMUNICATIONS )
[Facility Agreement]
-127-
SIGNED by )
)
)
for and on behalf of )
HUAXIA BANK )
THE ARRANGER
SIGNED by )
)
)
for and on behalf of )
INDUSTRIAL AND COMMERCIAL BANK OF )
CHINA (ASIA) LIMITED )
THE FACILITY AGENT
SIGNED by )
)
)
for and on behalf of )
INDUSTRIAL AND COMMERCIAL BANK OF )
CHINA (ASIA) LIMITED )
[Facility Agreement]
-128-