Exhibit 10.11
[ON THE LETTERHEAD OF ▇.▇. ▇▇▇▇▇▇ EUROPE LIMITED]
To: NTL Communications Limited
and
NTL Investment Holdings Limited
NTL House
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NTL Communications Corp.
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U.S.A.
The Guarantors (as defined in the Credit Agreement (as defined below))
c/o NTL Communications Limited.
NTL House
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Date: 8 March 2002
CREDIT AGREEMENT DATED 30 MAY 2000 ORIGINALLY MADE BETWEEN NTL COMMUNICATIONS
LIMITED AS PARENT, NTL BUSINESS LIMITED AS ORIGINAL BORROWER, THE PARTIES NAMED
THEREIN AS GUARANTORS, NTL COMMUNICATIONS CORPORATION AS NTL CC AND OTHERS, AS
AMENDED AND RESTATED PURSUANT TO A RESTATEMENT AMENDMENT AGREEMENT DATED 26
SEPTEMBER 2001 (THE "CREDIT AGREEMENT")
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
Terms defined in the Credit Agreement shall, unless otherwise defined
herein, bear the same meaning in this letter and in this letter:
"CABLECOM CREDIT AGREEMENT" means the credit agreement dated 28 March
2000 originally made between NTL Incorporated as parent, NTL Cablecom
Holding GmbH as shareholder, Cablecom (Ostschweiz) AG (now known as
Cablecom GmbH) as principal borrower, the parties named therein as
original borrowers, the parties named therein as original guarantors
and others, as amended pursuant to an amendment agreement dated 16 May
2000 and as further amended, novated, varied or supplemented from time
to time prior to the date hereof;
"CO-ORDINATORS" means the joint co-ordinators as defined in a
Confirmation of Terms of Appointment letter agreement dated 7 March
2002;
"NTL CC NOTES" means any bonds, notes or similar public debt
instruments issued by NTL CC in the domestic or international capital
markets and outstanding at the date of this letter;
"NTL GROUP NOTES" means the NTL CC Notes and any other bonds, notes or
similar public debt instruments issued in the domestic or international
capital markets by any other member of the Group;
"RELEVANT EVENTS OF DEFAULT" means the Events of Default at Clauses
24.6 (Cross Default), 24.7 (Insolvency and Rescheduling), 24.8 (Winding
Up), 24.10 (Analogous Events) and 24.16 (Covenant Group Cross Default)
of the Credit Agreement; and
"STEERING COMMITTEE" means the steering committee as set out in a
Confirmation of Terms of Appointment letter agreement dated 7 March
2002.
1.2 INTERPRETATION
Clause 1.2 (Interpretation) of the Credit Agreement shall apply to this
letter as if set out in full. Headings in this letter shall not affect
its interpretation.
2. THE PROPOSED RECAPITALISATION
NTL CC has informed the Agent that (a) it wishes to pursue a proposed
restructuring, readjustment, rescheduling and/or reorganisation of NTL
CC (the "PROPOSED RECAPITALISATION") (in particular in respect of its
debts and other obligations) and (b) in connection with the Proposed
Recapitalisation it intends to commence and progress negotiations (the
"NTL CC NEGOTIATIONS") with one or more of the holders (the "NTL CC
NOTEHOLDERS") of the NTL CC Notes and/or their representatives. NTL CC
has requested the Banks to:
2.1 consent to NTL CC taking all steps and corporate and other
action to take forward the Proposed Recapitalisation
(including, without limitation, commencing and progressing the
NTL CC Negotiations) (the "PROPOSED STEPS"); and
2.2 agree that any Event of Default (including any Relevant Event
of Default) or Potential Event of Default (including in
respect of any Relevant Event of Default) which will or may
occur solely (directly or indirectly) as a result of the
Proposed Steps will not constitute an Event of Default or, as
the case may be, Potential Event of Default.
3. CONSENT
Following the receipt of Instructing Group consent, the Agent, on
behalf of the Banks: (a) hereby consents to NTL CC taking the Proposed
Steps; and (b) hereby agrees that any
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Event of Default (including any Relevant Event of Default) or Potential
Event of Default (including in respect of any Relevant Event of
Default) which will or may occur solely (directly or indirectly) as a
result of the Proposed Steps will not constitute an Event of Default
or, as the case may be, Potential Event of Default (the "CONSENT")
PROVIDED THAT:
3.1 the Consent shall not be effective until the date upon which:
3.1.1 the agent under the Working Capital Facility has entered into
a consent letter (upon the instructions of an Instructing
Group (as defined in the credit agreement constituting the
Working Capital Facility)) with NTL CC (acting on behalf of
the Obligors (as defined in the credit agreement constituting
the Working Capital Facility)) on substantially the same terms
as this consent letter; and
3.1.2 the agent under the Cablecom Credit Agreement has entered into
a consent letter (upon the instructions of an Instructing
Group (as defined in the Cablecom Credit Agreement)) with
Cablecom GmbH (acting on behalf of the Obligors (as defined in
the Cablecom Credit Agreement)) on substantially the same
terms as this letter;
3.2 the Proposed Steps shall not include:
3.2.1 any exchange or similar offer to the NTL CC Noteholders or the
holders of any other NTL Group Notes (together with the NTL CC
Noteholders, the "NOTEHOLDERS") which exchange or similar
offer has been, or is required to be, filed with an
appropriate governmental agency or body (such as the U.S.
Securities and Exchange Commission) or is exempted from any
such filing but which is capable of acceptance by such
Noteholders (or any of them) (whether or not subject to
satisfaction of conditions);
3.2.2 any legally binding agreement for, or any offer to Noteholders
(or any of them) which is capable of acceptance (whether or
not subject to the satisfaction of conditions) in respect of,
the prepayment (in whole or in part) of amounts outstanding
under the NTL Group Notes (or any of them) or the granting of
any security, guarantee or other credit support in respect of
amounts outstanding under the NTL Group Notes (or any of them)
PROVIDED THAT this paragraph 3.2.2 shall not prohibit the
granting of any security, guarantee or other credit support by
Diamond Cable Communications Limited, Diamond Holdings Limited
or NTL (Triangle) LLC or any of their respective subsidiaries
where such security is required to be granted pursuant to the
terms (as at the date hereof) of the indentures constituting
the NTL Group Notes issued by Diamond Cable Communications
Limited, Diamond Holdings Limited or, as the case may be, NTL
Triangle LLC; or
3.2.3 the entry by any member of the Group into any legally binding
agreement with the Noteholders (or any of them) in their
capacity as such in relation to the Proposed Recapitalisation
(in the context of a restructuring) or the NTL Group Notes (or
any of them) (in the context of a restructuring), save for any
legally
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binding agreements: (a) entered into for the purpose of
enabling the provision of information by or to any member of
the Group in connection with the Proposed Recapitalisation or
to facilitate or enable the progress of non legally binding
discussions or negotiations in connection with the Proposed
Steps; (b) entered into for the purpose of engaging legal
and/or other professional advisors in connection with the
Proposed Recapitalisation; (c) under which the Noteholders
unconditionally agree for the benefit of the issuer of the
relevant NTL Group Notes to waive all or any, and/or agree not
to exercise all or any, of their rights in respect of the NTL
Group Notes; or (d) under which the Noteholders
unconditionally agree for the benefit of the issuer of the
relevant NTL Group Notes to a standstill arrangement (or any
other arrangement having similar effect) in respect of all or
any of their rights in respect of the NTL Group Notes; and
3.3 the Consent shall terminate at 5.30pm (New York time) on 29 March 2002
and as at such time or any time thereafter the Agent may by written
notice to the Relevant Obligor take any action pursuant to Clause 24.18
(Acceleration and Cancellation) of the Credit Agreement in respect of
any Event of Default the subject of the Consent to the extent that, at
the relevant time, such Event of Default is continuing. For the
avoidance of doubt, if at such time the NTL CC Negotiations are not
continuing and no other Proposed Steps are being taken at, or are taken
after, such time, no Event of Default the subject of the Consent shall
be continuing.
4. ACTION BY THE AGENT
Notwithstanding the Consent, the Agent may take any action deemed
appropriate pursuant to Clause 24.18 (Acceleration and Cancellation) of
the Credit Agreement and/or under any Finance Document upon (or at
anytime after):
4.1 the occurrence of any Event of Default under Clause 24.6 (Cross
Default) (but only whilst such Event of Default is continuing) other
than where such Event of Default is in respect of any creditor or
creditors becoming entitled (by reason of default) to declare any
Financial Indebtedness due and payable prior to its specified maturity
by reason of a default arising solely (directly or indirectly) as a
result of any of the Proposed Steps and such Financial Indebtedness is
not declared to be or does not otherwise become due and payable prior
to its specified maturity;
4.2 the occurrence of any Event of Default under Clause 24.16 (Covenant
Group Cross Default) (but only whilst such Event of Default is
continuing) other than where such Event of Default is in respect of any
holder or creditor becoming entitled to declare Permitted Covenant
Group Indebtedness due and payable prior to its specified maturity
solely (directly or indirectly) as a result of any of the Proposed
Steps and such Financial Indebtedness is not declared to be or does not
otherwise become due and payable prior to its specified maturity. For
the avoidance of doubt, the Agent, on behalf of the Banks, hereby
acknowledges that no Event of Default will occur under Clause 24.7.1
(Insolvency and Rescheduling) or Clause 24.16 (Covenant Group Cross
Default) in respect of Financial Indebtedness arising under the NTL CC
Notes not being paid when due and payable until such time as the NTL CC
Noteholders (or any of them) are
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entitled, under the terms and conditions of the NTL CC Notes, to
declare any Financial Indebtedness representing principal in respect of
the NTL CC Notes due and payable prior to its specified maturity date;
or
4.3 any of the Parent, the Post-Novation Borrower, NTL CC or any Guarantor
failing to duly perform or comply with any obligation expressed to be
assumed by it hereunder unless such failure relates to the obligation
at paragraph 5.3 below and such failure is remedied within two Business
Days or such failure relates to the obligations at paragraph 5.4 or 5.5
below and such failure is remedied within 7 Business Days.
5. PARENT UNDERTAKINGS
The Parent undertakes by its counter-signature of this letter to:
5.1 procure that no issuer of NTL Group Notes (or any party on such
issuer's behalf) at any time purchases or buys-back any of the NTL
Group Notes issued by it or by any other member of the Group;
5.2 procure that no member of the Group which is a Guarantor as at the date
of this letter resigns as a Guarantor;
5.3 provide to the Agent (in sufficient copies for all Banks, if the Agent
so requests) a 13 week rolling cash flow forecast for the UK Group (the
"FORECAST") which shall be updated by the Parent and provided to the
Agent on a fortnightly basis (the first Forecast to be delivered
pursuant to this paragraph 5.3 shall be delivered by the Parent to the
Agent on 5 March 2002). Each Forecast shall be in substantially the
same form as the pro forma Forecast agreed by and delivered to the
Agent prior to the date hereof and shall include details of cash
balances for members of the Group in substantially the same form as
that information appears in, and in respect of the same members of the
Group as, the aforementioned pro forma Forecast;
5.4 supply or otherwise make available to the Co-Ordinators an index of any
information relating to NTL CC or the UK Group or any member of the UK
Group which is provided to the Noteholders (or any of them) by any
member of the Group where such information is materially different from
any information which has been provided to the Co-Ordinators and/or the
Steering Committee and/or the Agent and/or the Banks. If requested by
the Co-Ordinators, the Parent shall make such aforementioned
information available to the Co-Ordinators on the same basis as such
information is made available to the Noteholders PROVIDED THAT the
Co-Ordinators have first signed a confidentiality undertaking in favour
of the Parent in a form acceptable to the Parent (acting reasonably);
5.5 provide to the Co-Ordinators copies of:
5.5.1 any material term sheets sent by any member of the Group to
the Noteholders (or any of them) and/or any of their advisors
and which relate to the Proposed Recapitalisation; and
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5.5.2 any material comments sent by any member of the Group to the
Noteholders (or any of them) and/or any of their advisors on
any material term sheets which relate to the Proposed
Recapitalisation;
5.6 ensure that any material term sheets sent by any member of the Group to
the Noteholders (or any of them) and/or any of their advisors and which
relate to the Proposed Recapitalisation are expressly marked so as to
indicate that any conclusive agreement (whether or not subject to
satisfaction of conditions) by any member of the Group in relation to
the Proposed Recapitalisation is subject to such member of the Group
obtaining the prior written consent of the Banks;
5.7 keep the Co-ordinators informed at each meeting between the Parent and
the Co-Ordinators of all material developments in relation to and, at
the request of the Co-Ordinators, make available to the Co-Ordinators
all requested documentation relating to:
5.7.1 any possible strategic investment in the Group (or any member
of the Group) by any person; or
5.7.2 any proposed disposal of, by one or more transactions or
series of transactions (whether related or not), the whole or
any part of the revenues or assets of any member of the UK
Group where such disposal is material in the context of the UK
Group taken as a whole; or
5.7.3 any proposed disposal of, by one or more transactions or
series of transactions (whether related or not), the whole or
any part of the revenues or assets of any member of the Group
not being a member of the UK Group where such disposal is
material in the context of the Group (excluding for the
purposes of this paragraph 5.7.3 the UK Group) taken as a
whole,
PROVIDED THAT the Parent shall only make any such information and
requested documentation available to the Co-Ordinators if the
Co-Ordinators have first signed a confidentiality undertaking in favour
of the Parent in a form acceptable to the Parent (acting reasonably)
and PROVIDED FURTHER THAT the Parent shall not be obliged to make such
information and requested documentation available to the Co-Ordinators
if the Parent demonstrates to the satisfaction of the Co-Ordinators (by
the delivery of a letter from the Group's external legal advisors
confirming the same, or by other satisfactory means) that it is
prohibited from making the information or, as the case may be,
requested documentation available under the terms of a confidentiality
undertaking it has entered into with a third party; and
5.8 procure that no member of the UK Group makes any Permitted Payment
other than:
5.8.1 a Permitted Payment falling within paragraph (b) of the
definition of Permitted Payment in the Credit Agreement
PROVIDED THAT the aggregate amount of all such Permitted
Payments made during the period from (and including) the date
hereof to (and including) the date of termination of the
Consent shall not exceed L5,000,000;
5.8.2 a Permitted Payment falling within paragraph (c)(i), (iv) (but
only in respect of any bonds, notes or similar public debt
instruments issued by NTL CC) or (v) of
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the definition of Permitted Payment in the Credit Agreement
PROVIDED THAT prior to the proposed Permitted Payment being
made NTL CC demonstrates to the satisfaction of the Agent (it
being agreed that the Agent shall be satisfied if the most
recently delivered Forecast confirms the same) that in the
absence of NTL CC receiving the proposed Permitted Payment it
will, following the making of the relevant cash payment
obligation in respect of which the Permitted Payment is
proposed to be made, have cash resources available to it in an
amount less than L25,000,000; and
5.8.3 a Permitted Payment falling within paragraph (d) or (f) of the
definition of Permitted Payment in the Credit Agreement.
6. CONFIRMATION AND REPRESENTATION FROM PARENT
6.1 The Parent confirms and represents by its countersignature to this
letter that to the best of its knowledge and belief no Event of Default
will occur under, and no Potential Event of Default will occur in
respect of, Clause 24.6 (Cross Default) or Clause 24.16 (Covenant Group
Cross Default) (other than under the credit agreement constituting the
Working Capital Facility and (assuming their unwind values exceed
L20,000,000 in aggregate) the ISDA Master Agreements each dated 26
March 2001 between The Chase Manhattan Bank and NTL CC and between The
Royal Bank of Scotland plc and NTL CC) as a result of the Proposed
Steps. The Parent agrees to promptly inform the Agent if it becomes
aware of any event which, if it were not the subject of the agreement
of the Banks contained in this letter, would constitute an Event of
Default or Potential Event of Default under or in respect of Clause
24.6 (Cross Default) or Clause 24.16 (Covenant Group Cross Default)
(save under the credit agreement constituting the Working Capital
Facility or the aforementioned ISDA Master Agreements).
6.2 The Parent represents that to the best of its knowledge and belief no
Event of Default (which is not a Relevant Event of Default) or
Potential Event of Default (which is not in respect of a Relevant Event
of Default) will or is likely to occur as a result of the Proposed
Steps.
6.3 For the purposes of this paragraph 6 "to the best of its knowledge and
belief" means the actual knowledge and belief of the Parent's Chief
Financial Officer and the Parent's Group Treasurer, each after having
made due and careful enquiry.
7. MISCELLANEOUS
7.1 This letter is a Finance Document for the purposes of the Credit
Agreement and all other Finance Documents.
7.2 The Consent shall be without prejudice to any other rights or remedies
(save as specifically agreed otherwise in this letter) which the Agent,
any Bank or any other person may now or at any time in the future have
or which may now or at any time in the future be available to them
under the terms of the Finance Documents or as a matter of law and
nothing contained herein shall (save as specifically consented to or
agreed in this letter) constitute or be deemed to constitute a waiver,
release or discharge of any or all of
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the rights and remedies which the Agent, any Bank or any other person
may have under the Finance Documents or as a matter of law.
7.3 The Co-Ordinators agree that they shall forward copies of any
documentation or information received pursuant to paragraphs 5.4, 5.5
or 5.7 only to members of the Steering Committee who have entered into
a confidentiality undertaking with the Parent in a form acceptable to
the Parent (acting reasonably).
7.4 We confirm that you may provide a copy of this letter to the agent and
the banks under the Working Capital Facility and to the agent and the
banks party to the Cablecom Credit Agreement.
7.5 A person who is not a party to this letter has no right under the
Contracts (Rights of Third Parties) ▇▇▇ ▇▇▇▇ to enforce any term of
this letter.
7.6 This letter shall be governed by, and construed in accordance with,
English law.
Please indicate your acceptance of the terms hereof by signing the enclosed copy
of this letter and returning it to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ at ▇.▇. ▇▇▇▇▇▇ Europe Limited
at or before 5:00 p.m. (London time) on 22nd March 2002, the time at which the
agreement of the Agent and the Banks set forth above (if not so accepted prior
thereto) will expire.
Yours faithfully,
For and on behalf of
▇.▇. ▇▇▇▇▇▇ EUROPE LIMITED
as Agent on behalf of the Banks
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title:
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ACCEPTED AND AGREED
NTL INVESTMENT HOLDINGS LIMITED
By: /s/ ▇▇▇▇ ▇▇▇▇▇
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Title:
Dated:
NTL COMMUNICATIONS CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title:
Dated:
NTL COMMUNICATIONS LIMITED
for itself and for and on behalf
of the Guarantors
By: /s/ ▇▇▇▇ ▇▇▇▇▇
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Title:
Dated:
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