HUF 33,700,000,000
Dual Currency Bridge Loan Agreement
dated May 1999
between
HUNGAROTEL TAVKOZLESI KONCESSZIOS RESZVENYTARSASAG
RABA-COM TAVKOZLESI KONCESSZIOS RESZVENYTARSASAG
PAPA ES TERSEGE TAVKOZLESI KONCESSZIOS RESZVENYTARSASAG
KNC KELET-NOGRAD COM TAVKOZLESI KONCESSZIOS RESZVENYTARSASAG
as Borrowers
and
POSTABANK ES TAKAREKPENZTAR RESZVENYTARSASAG
as Arranger
and
POSTABANK ES TAKAREKPENZTAR RESZVENYTARSASAG
as Facility Agent
and
POSTABANK ES TAKAREKPENZTAR RESZVENYTARSASAG
as Security Agent
and
THE FINANCIAL INSTITUTIONS
named in this Agreement as the Banks
and
HUNGARIAN TELEPHONE AND CABLE CORP.
HTCC TANACSADO RESZVENYTARSASAG
as Countersignors
Ormai es Tarsai Cameron McKenna
Citibank Tower, 4th Floor
Bank Center
Szabadsag ter 7.
X-0000 Xxxxxxxx
Xxxxxxx
Tel: x00 0 000 0000
Fax: x00 0 000 0000
CONTENTS
Clause Page No.
PART 1 - DEFINITIONS AND INTERPRETATION
1. Definitions and Interpretation 2
PART 2 - THE FACILITY
2. The Facility 25
3. Availability of the Facility 25
PART 3 - INTEREST
4. Interest Periods 27
5. Payment and Calculation of Interest 27
6. Alternative Interest Rates 27
PART 4 - REPAYMENT AND PREPAYMENT
7. Repayment 30
8. Prepayment 30
PART 5 - CHANGES IN CIRCUMSTANCES
9. Taxes 31
10. Tax Receipts 32
11. Increased Costs 33
PART 6 - REPRESENTATIONS, COVENANTS AND EVENTS OF DEFAULT
12. Representations 36
13. Financial Information 40
14. Financial Covenants 42
15. Covenants 43
16. Events of Default 49
PART 7 - DEFAULT INTEREST AND INDEMNITY
17. Default Interest and Indemnity 54
PART 8 - PAYMENTS
18. Currency of Account and Payment 56
19. Payments 56
20. Set-Off 58
21. Sharing 59
PART 9 - FEES, COSTS AND EXPENSES
22. Arrangement Fees 61
23. Costs and Expenses 61
PART 10 - AGENCY PROVISIONS
24. The Facility Agent, the Security Agent, the Arranger and the Banks 63
PART 11 - ASSIGNMENTS AND TRANSFERS
25. Assignments and Transfers 69
PART 12 - MISCELLANEOUS
26. Calculations and Evidence of Debt 71
27. Remedies and Waivers, Partial Invalidity 72
(i)
28. Notices 72
29. Amendments 73
PART 13 - LAW, ARBITRATION AND LANGUAGE
30. Law 75
31. Arbitration 75
32. Language 76
THE SCHEDULES
The First Schedule : The Banks 77
The Second Schedule : Form of Transfer Certificate 78
The Third Schedule : The Notice of Drawdown 81
The Fourth Schedule : Conditions Precedent Documents 83
(ii)
THIS DUAL CURRENCY BRIDGE LOAN AGREEMENT (the "Agreement") is made on May 1999
BETWEEN:
(1) HUNGAROTEL TAVKOZLESI KONCESSZIOS RESZVENYTARSASAG;
(2) RABA-COM TAVKOZLESI KONCESSZIOS RESZVENYTARSASAG;
(3) PAPA ES TERSEGE TAVKOZLESI KONCESSZIOS RESZVENYTARSASAG;
(4) KNC KELET-NOGRAD COM TAVKOZLESI KONCESSZIOS RESZVENYTARSASAG;
(5) POSTABANK ES TAKAREKPENZTAR RESZVENYTARSASAG as arranger (the
"Arranger");
(6) POSTABANK ES TAKAREKPENZTAR RESZVENYTARSASAG as facility agent (the
"Facility Agent");
(7) POSTABANK ES TAKAREKPENZTAR RESZVENYTARSASAG as security agent (the
"Security Agent ");
(8) THE BANKS (as defined below);
and countersigned by:
(9) HUNGARIAN TELEPHONE AND CABLE CORP.; and
(10) HTCC TANACSADO RESZVENYTARSASAG.
IT IS AGREED as follows:
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PART 1 - DEFINITIONS AND INTERPRETATION
1. Definitions and Interpretation
1.1 Definitions In this Agreement the following terms have the meanings
given to them in this Clause 1.1.
"10K Document" means the 10K filing made by Hungarian Telephone and
Cable Corp. to the Securities and Exchange Commission of the United
States of America in respect of the period ending on 31 December 1998.
"10Q Document" means any 10Q filing made by Hungarian Telephone and
Cable Corp. to the Securities and Exchange Commission of the United
States of America in respect of any quarter financial year of Hungarian
Telephone and Cable Corp.
"1996 Credit Facility Agreement" means the HUF equivalent of one
hundred and seventy million dollars (U.S.$ 170,000,000) multi-currency
credit facility agreement dated 10 October 1996 made between: (1)
Postabank es Takarekpenztar Reszvenytarsasag as lender; (2) Hungarotel
Tavkozlesi Reszvenytarsasag as borrower; (3) Papa es Tersege Telefon
Koncesszios Reszvenytarsasag as borrower; (4) Kelet-Nograd Com.
Reszvenytarsasag as borrower; (5) RABA-Com Tavkozlesi es
Telekommunikacios Koncesszios Reszvenytarsasag as borrower; (6) HTCC
Consulting Reszvenytarsasag as borrower; and (7) Hungarian Telephone
and Cable Corp. as guarantor, and this definition shall be deemed to
include any and all bilateral loan agreements made under the framework
of and pursuant to such multi-currency credit facility agreement.
"Advance" means, save as otherwise provided in this Agreement, any
advance (as from time to time reduced by repayment) made (or deemed to
be made) or to be made (or to be deemed to be made) by the Banks to a
Borrower under or pursuant to this Agreement.
"Annual Operating Budget" means, in respect of any person at any time,
the annual operating budget of such person at such time, in each case
approved in advance in writing by the Facility Agent, acting
reasonably.
"Articles of Association" means the articles of association or the deed
of foundation, as applicable, of any person as at the date of this
Agreement.
"Assignment of Contractual Rights No. 1 Agreement" means the assignment
of contractual rights agreement dated on or about the date of this
Agreement made between: (1) Hungarotel Tavkozlesi Koncesszios
Reszvenytarsasag as assignor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as assignee and Security Agent; (3) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and
(5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor.
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"Assignment of Contractual Rights No. 2 Agreement" means the assignment
of contractual rights agreement dated on or about the date of this
Agreement made between: (1) RABA-COM Tavkozlesi Koncesszios
Reszvenytarsasag as assignor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as assignee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and
(5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor.
"Assignment of Contractual Rights No. 3 Agreement" means the assignment
of contractual rights agreement dated on or about the date of this
Agreement made between: (1) Papa es Tersege Tavkozlesi Koncesszios
Reszvenytarsasag as assignor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as assignee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and (5) KNC
Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor.
"Assignment of Contractual Rights No. 4 Agreement" means the assignment
of contractual rights agreement dated on or about the date of this
Agreement made between: (1) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as assignor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as assignee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and (5) Papa
es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Assignment of Contractual Rights No. 5 Agreement" means the assignment
of contractual rights agreement dated on or about the date of this
Agreement made between: (1) HTCC Tanacsado Reszvenytarsasag as
assignor; (2) Postabank es Takarekpenztar Reszvenytarsasag as assignee
and Security Agent; (3) Hungarotel Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; (4) RABA-COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; (5) Papa es Tersege Tavkozlesi
Koncesszios Reszvenytarsasag as countersignor; and (6) KNC Kelet-Nograd
COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Assignment of Contractual Rights Agreements" means, at any time, each
of the Assignment of Contractual Rights No. 1 Agreement, the Assignment
of Contractual Rights No. 2 Agreement, the Assignment of Contractual
Rights No. 3 Agreement, the Assignment of Contractual Rights No. 4
Agreement, the Assignment of Contractual Rights No. 5 Agreement and any
other assignment of contractual rights agreement at such time
designated as such in writing jointly by the Facility Agent, the
Security Agent and any Obligor.
"Availability Period" means the period commencing on the date of this
Agreement and ending on the Termination Date.
"Available Commitment" means, in relation to a Bank at any time and
save as otherwise provided in this Agreement, the amount set opposite
its name in the First Schedule (The Banks) less the aggregate amount
which it has advanced under this Agreement at such time.
"Available Facility" means, at any time, the aggregate amount of the
Available Commitments at such time.
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"Bank" means any financial institution:
(a) named in the First Schedule (The Banks) (other than one which
has ceased to be a party to this Agreement in accordance with
the terms of this Agreement); or
(b) which has become a party to this Agreement in accordance with
the provisions of Clause 25.4 (Assignments by Banks) or Clause
25.5 (Transfers by Banks);
Provided that any transfer made by Postabank es Takarekpenztar
Reszvenytarsasag as original Bank under this Agreement shall be made
subject to the requirements expressed in Clause 25.3 (Assignments and
Transfer by Banks).
"Bankruptcy Act" means Act IL of 1991 on Bankruptcy, Liquidation and
Final Accounting, as amended, of Hungary.
"Basle Paper" means the paper entitled "International Convergence of
Capital Measurement and Capital Standards" dated July 1988 and prepared
by the Basle Committee on Banking Regulations and Supervision, as
amended in November 1991.
"Borrowers" means each of Hungarotel Tavkozlesi Koncesszios
Reszvenytarsasag, RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag,
Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag and KNC
Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag and "Borrower"
means any and each of them.
"Borrowers' Auditors" means, at any time, the auditors of the Borrowers
at such time, being, as at the date of this Agreement KPMG Hungaria
Konyvvizsgalo Ado- es Kozgazdasagi Tanacsado Kft. or any of Ernst &
Young Konyvszakerto Kft., Pricewaterhouse Coopers Konyvvizsgalo es
Gazdasagi Tanacsado Kft., Xxxxxx Xxxxxxxx & Co. Konyvszakerto Ado- es
Vezetesi Tanacsado Kft. or such other internationally recognised firm
of independent auditors licensed to practice in Hungary, duly appointed
by each of the Borrowers to replace such firm and approved in advance
in writing by the Facility Agent, such approval not to be unreasonably
withheld or delayed.
"Bridge Loan Agreement" means this Agreement.
"BUBOR" means:
(a) the rate per annum which is the offered rate in HUF for the
applicable interest period which appears on the Reuters
Screen at Page BUBOR= (or such other page as may replace page
BUBOR= for the purposes of displaying the Budapest Interbank
Offered Rates) at or about 11.00 a.m. Budapest time) or,
if such page or such service shall cease to be available, such
other page or such other service (as the case may be) for the
purpose of displaying Budapest Interbank Offered Rates for
HUF as the Facility Agent, after consultation with the Banks
and the Borrowers,
shall select; and
(b) if no quotation for HUF and the relevant period for which
interest is to accrue are displayed and the Facility Agent
has not selected an alternative service on which two or more
such quotations are displayed, "BUBOR" shall mean the
arithmetic mean (rounded upwards, if not already such a
multiple, to the nearest whole multiple of one-sixteenth
of one per cent. (0.0625%)) of the rates (as notified to the
Facility Agent) at which each of the Reference Banks was
offering to prime banks in Budapest Interbank Market deposits
in HUF and for such period at or about 11.00 a.m. (Budapest
time) on the Quotation Date for such period for which
interest is to accrue.
-4-
"Business Plan" means, in respect of any person at any time, the
business plan of such person at such time.
"Capital Adequacy Requirement" means a request or requirement relating
to the maintenance of capital, including one which makes any change to,
or is based on any alteration in, the interpretation of the Basle Paper
or which increases the amounts of capital required thereunder, other
than a request or requirement made by way of implementation of the
Basle Paper in the manner in which it is being implemented at the date
of this Agreement.
"Citizens International Management Services Company" means Citizens
International Management Services Company, a company duly incorporated
under the laws of State of Delaware, United States of America, whose
principal place of business is at 0 Xxxx Xxxxx Xxxx, Xxxxxxxx,
Xxxxxxxxxxx, XX00000, Xxxxxx Xxxxxx of America.
"Citizens Utilities Company" means Citizens Utilities Company, a
corporation incorporated under the laws of the State of Delaware,
United States of America, whose principal place of business is at 0
Xxxx Xxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx, XX00000, Xxxxxx Xxxxxx of
America.
"Civil Code" means Act IV of 1959 on the Civil Code, as amended, of
Hungary.
"Closing Agent" means Postabank es Takarekpenztar Reszvenytarsasag in
its capacity as Closing Agent under the Master Closing Agreement.
"Companies Act" means Act CXLIV of 1997 on Business Associations, as
amended, of Hungary.
"Concession Contract" means, in respect of:
(i) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag, the
concession contract dated 6 May 1994 made between: (1)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag; and (2)
the Ministry, as amended on 16 June 1996;
(ii) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag, the
concession contract dated 6 May 1994 made between: (1)
RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag; and (2) the
Ministry;
(iii) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag, the
concession contract dated 6 May 1994 made between: (1) Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag; and (2) the
Ministry, as amended on 16 June 1996; and
(iv) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag,
the concession contract dated 6 May 1994 made between: (1) KNC
Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag; and
(2) the Ministry.
"Constitutional Documents" means, in respect of any person at any time,
the then current and up-to-date constitutional documents of such person
at such time (including, inter alia, such person's articles of
association or deed of foundation, as applicable, internal rules of
organisation and operation, rules of procedure of board of directors
meetings, if applicable, rules of procedure of supervisory board
meetings, if applicable, register of quotaholder(s) or shareholder(s),
as appropriate, and all similar and/or analogous documents whatsoever).
-5-
"Direct Suretyship No. 1 Agreement" means the direct suretyship
agreement dated on or about the date of this Agreement made between:
(1) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as guarantor;
(2) Postabank es Takarekpenztar Reszvenytarsasag as beneficiary and
Security Agent; (3) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; (4) Papa es Tersege Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; and (5) KNC Kelet-Nograd COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Direct Suretyship No. 2 Agreement" means the direct suretyship
agreement dated on or about the date of this Agreement and made
between: (1) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as
guarantor; (2) Postabank es Takarekpenztar Reszvenytarsasag as
beneficiary and Security Agent; (3) Hungarotel Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; (4) Papa es Tersege Tavkozlesi
Koncesszios Reszvenytarsasag as countersignor; and (5) KNC Kelet-Nograd
COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Direct Suretyship No. 3 Agreement" means the direct suretyship
agreement dated on or about the date of this Agreement and made
between: (1) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
guarantor; (2) Postabank es Takarekpenztar Reszvenytarsasag as
beneficiary and Security Agent; (3) Hungarotel Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; (4) RABA-COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; and (5) KNC Kelet-Nograd COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Direct Suretyship No. 4 Agreement" means the direct suretyship
agreement dated on or about the date of this Agreement and made
between: (1) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as guarantor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as beneficiary and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and (5) Papa
es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Direct Suretyship No. 5 Agreement" means the direct suretyship
agreement dated on or about the date of this Agreement made between:
(1) HTCC Tanacsado Reszvenytarsasag as guarantor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as beneficiary and Security Agent; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(5) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (6) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Direct Suretyship No. 6 Agreement" means the direct suretyship
agreement dated on or about the date of this Agreement made between:
(1) Hungarian Telephone and Cable Corp. as guarantor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as beneficiary and Security Agent; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(5) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (6) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Direct Suretyship Agreements" means, at any time, each of the Direct
Suretyship No. 1 Agreement, the Direct Suretyship No. 2 Agreement, the
Direct Suretyship No. 3 Agreement, the Direct Suretyship No. 4
Agreement, the Direct Suretyship No. 5 Agreement, the Direct Suretyship
No. 6 Agreement and any other direct suretyship agreement at such time
designated as such in writing jointly by the Facility Agent and any
Obligor.
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"Distribution" means, at any time, any dividend or distribution or
other payment whatsoever duly paid by, or on behalf of, any Obligor to
or for the benefit of its shareholders excluding for the avoidance of
doubt any payments to the former management of Hungarian Telephone and
Cable Corp., duly disclosed in the 10K Document.
"Enforcement of Judicial Decisions Act" means Act LIII of 1994 on the
Enforcement of Judicial Decisions, as amended, of Hungary.
"EURIBOR" means, in relation to any amount to be advanced to, or owing
by, any Borrower under this Agreement in euro on which interest for a
given period is to accrue:
(a) the percentage rate per annum equal to the offered quotation
which appears on the page of the Telerate Screen which
displays an average rate of the Banking Federation of
the European Union for the euro (being currently page 248)
for such period at or about 11.00 a.m. (Brussels time) on the
Quotation Date for such period or, if such page or such
service shall cease to be available, such other page or
such other service for the purpose of displaying an average
rate of the Banking Federation of the European Union as the
Facility Agent, after consultation with the Banks and the
Borrower, shall select; or
(b) if no quotation for the euro for the relevant period is
displayed and the Facility Agent has not selected an
alternative service on which a quotation is displayed, the
arithmetic mean (rounded upwards to four decimal places) of
the rates (as notified to the Facility Agent) at which each of
the Reference Banks was offering to prime banks in the
European interbank market deposits in the euro of an
equivalent amount and for such period at or about 11.00 a.m.
(Brussels time) on the Quotation Date.
"Event of Default" means any circumstances described as such in
Clause 16 (Events of Default).
"Facility" means the term loan facility granted to the Borrowers in
this Agreement.
"Facility Office" means, in relation to each Finance Party, the office
identified with its signature below (or, in the case of a Transferee,
at the end of the Transfer Certificate to which it is a party as
Transferee) or such other office as it may from time to time select.
"Fee Letter" means the letter dated on or about the date of this
Agreement, from the Arranger to the Borrowers, setting out the upfront
fee and the fees, costs and expenses of the Arranger to be duly
reimbursed or discharged, as appropriate, by the Borrower from the
first Advance(s) made under this Agreement and in any event no later
than the earlier of the Closing (as defined in the Master Close
Agreement) and three (3) days after the date of this Agreement.
"Final Maturity Date" means the date twelve (12) months after the date
of this Agreement.
"Finance Documents" means, at any time, each of this Agreement, the
Deferral Agreement, the Fee Letter, the Letter of Borrowings and
Encumbrances, the Master Closing Agreement, the Security Agreements,
the Securities Purchase Agreement, the Warrant Agreement and any other
document, notice, instrument or agreement entered into or delivered
pursuant to any of the foregoing and each and every other document
detailed in the Fourth Schedule (Conditions Precedent Documents) and
any other document, notice, instrument or agreement at such time
designated as such in writing jointly by the Facility Agent and any
Obligor, and "Finance Document" shall mean any or each such document,
notice, instrument or agreement.
"Finance Parties" means each of the Arranger, the Facility Agent, the
Security Agent and each Bank and "Finance Party" shall mean any or each
of them.
-7-
"Financial Indebtedness" means any indebtedness for or in respect of:
(a) any documentary credit facility;
(b) any interest rate swap, currency swap, forward foreign
exchange transaction, cap, floor, or option transaction or any
other transaction entered into in connection with protection
against or benefit from fluctuation in any rate or price (and
the amount of the Financial Indebtedness in relation to any
such transaction shall be calculated by reference to the
mark-to-market valuation of such transaction at the relevant
time);
(c) any guarantee, indemnity, bond, standby letter of credit or
any other instrument issued in connection with the performance
of any contract or other obligation;
(d) monies borrowed;
(e) any amount raised by acceptance under any acceptance credit
facility;
(f) any amount raised pursuant to any note purchase facility or
the issue of bonds, notes, debentures, loan stock or any
similar instrument;
(g) any amount raised pursuant to any issue of shares which
are expressed to be redeemable;
(h) the amount of any liability in respect of any lease or hire
purchase contract which would, in accordance with US GAAP
and/or IAS and/or HAS, as consistently applied in the relevant
jurisdiction, be treated as a finance or capital lease;
(i) the amount of any liability in respect of any advance or
deferred purchase agreement if one of the primary reasons for
entering into such agreement is to raise finance;
(j) receivables, sold or discounted (other than on a non-recourse
basis);
(k) any agreement or option to re-acquire an asset if one of the
primary reasons for entering into such agreement or option is
to raise finance;
(l) any amount raised under any other transaction (including any
forward sale or purchase agreement) having the commercial
effect of a borrowing; and
(m) the amount of any liability in respect of any guarantee or
indemnity for any of the items referred to in paragraphs (d)
to (l) above.
"Fixed Charge No. 1 Agreement" means the fixed charge agreement dated
on or about the date of this Agreement made between: (1) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as pledgor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as pledgee and Security Agent; (3)
RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4)
Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
-8-
"Fixed Charge No. 2 Agreement" means the fixed charge agreement dated
on or about the date of this Agreement made between: (1) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as pledgor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as pledgee and Security Agent; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(4) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Fixed Charge No. 3 Agreement" means the fixed charge agreement dated
on or about the date of this Agreement made between: (1) Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag as pledgor; (2)
Postabank es Takarekpenztar Reszvenytarsasag as pledgee and Security
Agent; (3) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; (4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Fixed Charge No. 4 Agreement" means the fixed charge agreement dated
on or about the date of this Agreement made between: (1) KNC
Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as pledgor;
(2) Postabank es Takarekpenztar Reszvenytarsasag as pledgee and
Security Agent; (3) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag
as countersignor; (4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag
as countersignor; and (5) Papa es Tersege Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Fixed Charge No. 5 Agreement" means the fixed charge agreement dated
on or about the date of this Agreement made between: (1) HTCC Tanacsado
Reszvenytarsasag as pledgor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as pledgee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (5) Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and
(6) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor.
"Fixed Charge Agreements" means, at any time, each of the Fixed Charge
No. 1 Agreement, the Fixed Charge No. 2 Agreement, the Fixed Charge No.
3 Agreement, the Fixed Charge No. 4 Agreement, the Fixed Charge No. 5
Agreement and any other fixed charge agreement at such time designated
as such in writing jointly by the Facility Agent and any Obligor.
"Floating Charge No. 1 Agreement" means the floating charge agreement
dated on or about the date of this Agreement made between: (1)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as pledgor; (2)
Postabank es Takarekpenztar Reszvenytarsasag as pledgee and Security
Agent; (3) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; (4) Papa es Tersege Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; and (5) KNC Kelet-Nograd COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Floating Charge No. 2 Agreement" means the floating charge agreement
dated on or about the date of this Agreement made between: (1) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as pledgor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as pledgee and Security Agent; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(4) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
-9-
"Floating Charge No. 3 Agreement" means the floating charge agreement
dated on or about the date of this Agreement made between: (1) Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag as pledgor; (2)
Postabank es Takarekpenztar Reszvenytarsasag as pledgee and Security
Agent; (3) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; (4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Floating Charge No. 4 Agreement" means the floating charge agreement
dated on or about the date of this Agreement made between: (1) KNC
Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as pledgor;
(2) Postabank es Takarekpenztar Reszvenytarsasag as pledgee and
Security Agent; (3) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag
as countersignor; (4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag
as countersignor; and (5) Papa es Tersege Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Floating Charge No. 5 Agreement" means the floating charge agreement
dated on or about the date of this Agreement made between: (1) HTCC
Tanacsado Reszvenytarsasag as pledgor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as pledgee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (5) Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and
(6) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor.
"Floating Charge Agreements" means, at any time, each of the Floating
Charge No. 1 Agreement, the Floating Charge No. 2 Agreement, the
Floating Charge No. 3 Agreement, the Floating Charge No. 4 Agreement,
the Floating Charge No. 5 Agreement and any other floating charge
agreement designated at such time as such in writing jointly by the
Facility Agent and any Obligor.
"Foreign Exchange Act" means Act XCV of 1995 on Foreign Exchange, as
amended, of Hungary.
"Good Industry Practice" means the exercise of that degree of skill,
diligence, prudence, foresight and operating practice which would
reasonably and ordinarily be expected from a skilled and experienced
international operator engaged in the same type of undertaking as the
Group.
"Government Decree" means government decree number 7 of 1997
(I.22.) issued by the Hungarian Government pursuant to the Civil Code.
"Group" means, at any time, each of Hungarian Telephone and Cable
Corp. and its subsidiaries at such time.
"Guarantors" means each of Hungarian Telephone and Cable Corp.
and HTCC Tanacsado Reszvenytarsasag and "Guarantor" means each and
any of them.
"HTCC Tanacsado Reszvenytarsasag" means HTCC Tanacsado
Reszvenytarsasag, a company duly incorporated under the laws of
Hungary, with its registered office at Xxxxxxxxxx xxxx 0, X-0000
Xxxxxxxx, Xxxxxxx and registered at the Metropolitan Court of
Registration with registration number 00-00-000000.
"Hungarian Telephone and Cable Corp." means Hungarian Telephone and
Cable Corp., a company registered under the laws of the State of
Delaware, United States of America and whose registered office is at 00
Xxxx Xxxxxx, Xxx Xxxx XX00000, Xxxxxx Xxxxxx of America, with the seat
of the company being 100 First Stamford Place Suite, 000 Xxxxxxxx,
XX00000, Xxxxxxxxxxx, Xxxxxx Xxxxxx of America.
-00-
"Xxxxxxxxxx Xxxxxxxxxx Xxxxxxxxxxx Xxxxxxxxxxxxxxxx" means Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag, a company duly incorporated
under the laws of Hungary, with its registered office at Xxxxxxxxxx
xxxx 0, X-0000 Xxxxxxxx, Xxxxxxx and registered at the Metropolitan
Court of Registration with registration number 00-00-000000.
"Hungary" means the Republic of Hungary.
"Income" means, in respect of any person at any time, the entire income
of and all cash and/or money and/or money equivalent receivables
whatsoever and howsoever arising of such person at such time.
"Income Accounts" means the bank accounts of the Obligors opened and
maintained with the Facility Agent, being, as at the date of this
Agreement, in respect of:
(i) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag,
account number 00000000-00000000 and any sub-accounts of
such account;
(ii) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag, account
number 11991102-02177498 and any sub-accounts of such account;
(iii) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag,
account number 00000000-00000000 and any sub-accounts of such
account;
(iv) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag,
account number 00000000-00000000 and any sub-accounts of such
account; and
(v) HTCC Tanacsado Reszvenytarsasag, account number
11991102-02177515 and any sub-accounts of such account,
and/or any other account(s) and/or branch(es) as the Facility Agent may
reasonably require.
"Instructing Group" means:
(a) before any Advance has been made under this Agreement, a
Bank or group of Banks whose Available Commitments amount
in aggregate to more than sixty six and two-thirds per
cent. (662/3 %) of the Available Facility; and
(b) thereafter, a Bank or group of Banks to whom in aggregate
more than sixty six and two-thirds per cent. (662/3 %) of
the Loan is (or, immediately prior to its repayment, was
then) owed.
-11-
"Interest Period" means, save as otherwise provided in this Agreement,
any of those periods mentioned in Clause 4.1 (Interest Periods).
"IO Fund" means the Danish Investment Fund of Central and Eastern
Europe an entity organised under the laws of Denmark.
"KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag" means
KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag, a company
duly incorporated under the laws of Hungary, with its registered office
at Xxxxx Xx. xxxx 00., X-0000 Xxxxxxxxx, Xxxxxxx and registered at the
Nograd County Court of Registration with registration number
00-00-000000.
"Letter of Borrowings and Encumbrances" means the letter dated on or
about the date of this Agreement, addressed to the Facility Agent and
signed by each of Hungarian Telephone and Cable Corp., HTCC Tanacsado
Reszvenytarsasag, Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag,
RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag, Papa es Tersege
Tavkozlesi Koncesszios Reszvenytarsasag and KNC Kelet-Nograd COM
Tavkozlesi Koncesszios Reszvenytarsasag setting out, in reasonable
detail, particulars of: (i) all of their respective indebtedness,
(whether incurred as principal or surety), whether present or future,
actual or contingent; (ii) all encumbrances (if any), whether present
or future, actual or contingent, over any of their respective assets
(other than Permitted Encumbrances); and (iii) if not already provided
for in the Master Closing Agreement, an explanation as to how such
indebtedness and encumbrances will be repaid, eliminated, discharged,
released, replaced and/or consolidated, as applicable, on the basis
agreed in advance in writing prior to the date of this Agreement by
each member of the Group and the Facility Agent.
"Letters of Intent" means each of the Letters of Intent provided to
Hungarian Telephone and Cable Corp. by each of three (3) international
prime banks (or by their Hungarian subsidiaries), in each case, confirm
their strong interest in refinancing, or arranging the refinancing of,
the amounts outstanding under this Agreement.
"LIBOR" means, in relation to any amount denominated in any currency
other than HUF or euro owed by the Borrower under this Agreement on
which interest for a given period is to accrue, the rate per annum
determined by the Facility Agent to be equal to the arithmetic mean
(rounded upwards, if not already such a multiple, to the nearest whole
multiple of one-sixteenth of one per cent. (0.0625%)) of the offered
quotations which appear on the relevant page (as defined in Clause 1.6
(Screen Rates)) for such period for which interest is to accrue at or
about 11.00 a.m. (London time) on the Quotation Date for such period.
"Loan" means, at any time, the aggregate principal amount for the time
being outstanding under this Agreement, at such time, expressed in HUF,
and where an Advance is denominated in the Optional Currency, the HUF
equivalent of the amount of such Advance is to be determined by
reference to the date on which such Advance was first drawn down.
"Margin" means:
(i) for the period commencing on the date of this Agreement
and ending on (and including) 30 September 1999, two point
two-five per cent. (2.25%);
(ii) for the period commencing 1 October 1999 and ending on (and
including) 31 December 1999, three point two-five per cent.
(3.25%); and
(iii) for the period commencing 1 January 2000 and ending on (and
including) the Final Maturity Date, four point two-five per
cent. (4.25%).
-12-
"Master Closing Agreement" means the master closing agreement dated on
or about the date of this Agreement made between: (1) Hungarian
Telephone and Cable Corp.; (2) HTCC Tanacsado Reszvenytarsasag; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag; (5) Papa es Tersege Tavkozlesi
Koncesszios Reszvenytarsasag; (6) KNC Kelet-Nograd COM Tavkozlesi
Koncesszios Reszvenytarsasag; (7) Postabank es Takarekpenztar
Reszvenytarsasag as Arranger; (8) Postabank es Takarekpenztar
Reszvenytarsasag as Facility Agent; (9) Postabank es Takarekpenztar
Reszvenytarsasag as Security Agent; (10) Postabank es Takarekpenztar
Reszvenytarsasag as Bank; and (11) Postabank es Takarekpenztar
Reszvenytarsasag as Closing Agent.
"Minister" means, at any time, the Minister appointed at such time to
head the Ministry.
"Ministry" means the Ministry of Transport, Communication and Water
Management of Hungary.
"Mortgage No. 1 Agreement" means the mortgage agreement dated on or
about the date of this Agreement made between: (1) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as mortgagor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as mortgagee and Security Agent; (3)
RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4)
Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (5) KNC Kelet-Nograd
COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Mortgage No. 2 Agreement" means the mortgage agreement dated on or
about the date of this Agreement made between: (1) RABA-COM Tavkozlesi
Koncesszios Reszvenytarsasag as mortgagor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as mortgagee and Security Agent; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(4) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Mortgage No. 3 Agreement" means the mortgage agreement dated on or
about the date of this Agreement made between: (1) Papa es Tersege
Tavkozlesi Koncesszios Reszvenytarsasag as mortgagor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as mortgagee and Security Agent; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
and (5) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor.
"Mortgage No. 4 Agreement" means the mortgage agreement dated on or
about the date of this Agreement made between: (1) KNC Kelet-Nograd COM
Tavkozlesi Koncesszios Reszvenytarsasag as mortgagor; (2) Postabank es
Takarekpenztar Reszvenytarsasag as mortgagee and Security Agent; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
and (5) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor.
-13-
"Mortgage No. 5 Agreement" means the mortgage agreement dated on or
about the date of this Agreement made between: (1) HTCC Tanacsado
Reszvenytarsasag as mortgagor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as mortgagee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (5) Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and
(6) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor.
"Mortgage Agreements" means, at any time, each of the Mortgage No. 1
Agreement, the Mortgage No. 2 Agreement, the Mortgage No. 3 Agreement,
the Mortgage No. 4 Agreement, the Mortgage No. 5 Agreement and any
other mortgage agreement at such time designated as such
in writing jointly by the Facility Agent and any Obligor.
"NBH" means the National Bank of Hungary.
"NBH Permission" means the permission of the NBH issued to Postabank es
Takarekpenztar Reszvenytarsasag to acquire the Warrants pursuant to the
Securities Purchase Agreement.
"Notaries Public Act" means Act XLI of 1991 on Notaries Public, as
amended, of Hungary.
"Notary Public" means a notary public of Hungary, duly operating under
the Notaries Public Act who, amongst other matters, is entitled to
notarise and enter details of applicable collateral securities into the
Register of Pledges.
"Note" means any note dated on or about the date of this Agreement
made between: (1) Hungarian Telephone and Cable Corp. as issuer;
and (2) Postabank es Takarekpenztar Reszvenytarsasag as purchaser.
"Notice of Drawdown" means the notice of drawdown substantially in the
form set out in the Third Schedule (Notice of Drawdown).
"Obligors" means each of the Borrowers and each member of the Group and
"Obligor" shall mean any or each of them.
"Optional Currency" means euro.
"Original Financial Statements" means, in respect of:
(i) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag, its
financial statements for its financial year ended 31 December
1998 audited by the Borrowers' Auditors;
(ii) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag, its
financial statements for its financial year ended 31 December
1998 audited by the Borrowers' Auditors;
(iii) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag, its
financial statements for its financial year ended 31 December
1998 audited by the Borrowers' Auditors;
(iv) KNC Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag,
its financial statements for its financial year ended 31
December 1998 audited by the Borrowers' Auditors;
(v) Hungarian Telephone and Cable Corp., the 10K Document; and
(vi) HTCC Tanacsado Reszvenytarsasag, its financial statements for
its financial year ended 31 December 1998 audited by the
Borrowers' Auditors.
-00-
"Xxxx xx Xxxxxxx Xxxxxxxxxx Xxxxxxxxxxx Xxxxxxxxxxxxxxxx" means Papa es
Tersege Tavkozlesi Koncesszios Reszvenytarsasag, a company duly
incorporated under the laws of Hungary, with its registered office at
Xxxxx xxxx 0., X-0000 Xxxx, Xxxxxxx and registered at the Veszprem
County Court of Registration with registration number 00-00-000000.
"Permitted Disposal" means any sale, lease, transfer or other disposal
of, by one or more transactions or series of transactions (whether
related or not), by any person of any of its revenues and/or assets
which is made by such person:
(a) in the ordinary course of such person's business;
(b) on an arm's length and open market basis;
(c) in respect of assets duly certified by such person in writing
in advance as being redundant and/or obsolete; and
(d) which when aggregated with all other such disposals made by
any member of the Group (and not already falling within the
scope of paragraphs (a) to (c) above do not exceed an amount
equivalent to three hundred million Forints (HUF 300,000,000).
"Permitted Distribution" means
(i) any Distribution made by any Borrower to Citizens
International Management Services Company which when
aggregated with all other such Distributions do not, in any
twelve (12) month period, exceed an amount equivalent to one
hundred and five thousand dollars (U.S.$ 105,000); and
(ii) for the avoidance of doubt, any payment duly made to the
former management of Hungarian Telephone and Cable Corp. which
has been duly disclosed and provided for in the 10K Document.
"Permitted Encumbrance" means:
(i) any encumbrance disclosed and/or provided for in the Letter
of Borrowings and Encumbrances;
(ii) any encumbrance in respect of any assets of any Obligor arising
by mandatory operation of laws and regulations of Hungary;
(iii) any encumbrance in respect of any assets of any Borrower arising
in the ordinary course of business of such Borrower and not by
reason of default which when aggregated with all other such
encumbrances does not exceed an amount equivalent to five
hundred million forints (HUF 500,000,000);
(iv) any title retention or similar arrangement created under or
pursuant to any contract for the purchase of goods by any
Borrower in the ordinary course of its business; and
(v) any encumbrance approved in advance in writing by the Facility
Agent.
"Pledge Over Bank Accounts No. 1 Agreement" means the pledge over bank
accounts agreement dated on or about the date of this Agreement made
between: (1) Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as
pledgor; (2) Postabank es Takarekpenztar Reszvenytarsasag as pledgee
and Security Agent; (3) RABA-COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; (4) Papa es Tersege Tavkozlesi
Koncesszios Reszvenytarsasag as countersignor; and (5) KNC Kelet-Nograd
COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
-15-
"Pledge Over Bank Accounts No. 2 Agreement" means the pledge over bank
accounts agreement dated on or about the date of this Agreement made
between: (1) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as
pledgor; (2) Postabank es Takarekpenztar Reszvenytarsasag as pledgee
and Security Agent; (3) Hungarotel Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; (4) Papa es Tersege Tavkozlesi
Koncesszios Reszvenytarsasag as countersignor; and (5) KNC Kelet-Nograd
COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Pledge Over Bank Accounts No. 3 Agreement" means the pledge over bank
accounts agreement dated on or about the date of this Agreement made
between: (1) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
pledgor; (2) Postabank es Takarekpenztar Reszvenytarsasag as pledgee
and Security Agent; (3) Hungarotel Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; (4) RABA-COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; and (5) KNC Kelet-Nograd COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Pledge Over Bank Accounts No. 4 Agreement" means the pledge over bank
accounts agreement dated on or about the date of this Agreement made
between: (1) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as pledgor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as pledgee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; and (5) Papa
es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as countersignor.
"Pledge Over Bank Accounts No. 5 Agreement" means the pledge over bank
accounts agreement dated on or about the date of this Agreement made
between: (1) HTCC Tanacsado Reszvenytarsasag as pledgor; (2) Postabank
es Takarekpenztar Reszvenytarsasag as pledgee and Security Agent; (3)
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(4) RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag as countersignor;
(5) Papa es Tersege Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (6) KNC Kelet-Nograd COM Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Pledge Over Bank Accounts Agreements" means, at any time, each of the
Pledge Over Bank Accounts No. 1 Agreement, the Pledge Over Bank
Accounts No. 2 Agreement, the Pledge Over Bank Accounts No. 3
Agreement, the Pledge Over Bank Accounts No. 4 Agreement, the Pledge
Over Bank Accounts No. 5 Agreement and any other pledge over bank
accounts agreement at such time designated as such in writing jointly
by the Facility Agent and any Obligor.
"Potential Event of Default" means any event which would become (with
the passage of time, the giving of notice, the making of any
determination under this Agreement or any combination thereof) an Event
of Default.
-16-
"Qualifying Bank" means any bank or financial institution which:
(a) is resident pursuant to the terms of the relevant double tax
treaty in a state which has concluded a double tax treaty with
Hungary in force at the date of this Agreement (or in relation
to a Bank which becomes a party to this Agreement at any time
after the date of this Agreement, in force at the time that
Bank becomes a party to this Agreement) which provides that
interest arising in Hungary which is paid to a resident of the
other contracting state shall be taxable only in that other
state; or
(b) is resident in Hungary for tax purposes under applicable laws
and regulations of Hungary.
"Quotation Date" means, in relation to any period for which an interest
rate is to be determined under this Agreement:
(a) in respect of an amount denominated in the Optional Currency,
the day on which quotations would ordinarily be given by prime
banks in the London Interbank Market for deposits in the
Optional Currency; and
(b) in respect of an amount denominated in HUF, the day on which
quotations would ordinarily be given by prime banks in the
Budapest Interbank Market for deposits in HUF;
in each case for delivery on the first day of that period for which
interest is to accrue Provided that, if, for any such period for which
interest is to accrue, quotations would ordinarily be given on more
than one date, the Quotation Date for that period shall be the last of
those dates.
"RABA-COM Tavkozlesi Koncesszios Reszvenytarsasag" means RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag, a company duly incorporated
under the laws of Hungary, with its registered office at Xxx Xxxxx utca
1., X-0000 Xxxxxx, Xxxxxxx and registered at the Vas County Court of
Registration with registration number 00-00-000000.
"Reference Banks" means, in the case of an amount denominated in: (i)
the Optional Currency, the principal London offices of ABN AMRO Bank
N.V., Citibank N.A. and ING Bank N.V.; or (ii) in the case of an amount
denominated in HUF the principal Budapest offices of ABN AMRO (Magyar)
Bank Rt., Citibank Rt. and Orszagos Takarekpenztar es Kereskedelmi Bank
Rt. or such other bank or banks as may from time to time be agreed
between the Borrowers and the Facility Agent, such agreement not to be
unreasonably withheld or delayed.
"Register of Pledges" means the register of pledges maintained by the
Hungarian National Chamber of Notaries Public, as provided for by the
Government Decree.
"Security Agreements" means, at any time, each of the Assignment of
Contractual Rights Agreements, the Direct Suretyship Agreements, the
Fixed Charge Agreements, the Floating Charge Agreements, the Mortgage
Agreements, the Pledge Over Bank Accounts Agreements, the Share Deposit
Agreements, the Sponsors' Support Agreement and any other document at
such time designated as such in writing jointly by the Facility Agent
and any Obligor.
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"Securities Purchase Agreement" means the securities purchase agreement
dated on or about the date of this Agreement made between: (1)
Hungarian Telephone and Cable Corp.; and (2) Postabank es
Takarekpenztar Reszvenytarsasag.
"Share Deposit No. 1 Agreement" means the share deposit agreement dated
on or about the date of this Agreement made between: (1) Hungarian
Telephone and Cable Corp. as depositor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as depositee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (5) KNC
Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; (6) Papa es Tersege Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor; and (7) HTCC Tanacsado
Reszvenytarsasag as countersignor.
"Share Deposit No. 2 Agreement" means the share deposit agreement dated
on or about the date of this Agreement made between: (1) HTCC Tanacsado
Reszvenytarsasag as depositor; (2) Postabank es Takarekpenztar
Reszvenytarsasag as depositee and Security Agent; (3) Hungarotel
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (4) RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag as countersignor; (5) KNC
Kelet-Nograd COM Tavkozlesi Koncesszios Reszvenytarsasag as
countersignor; and (6) Papa es Tersege Tavkozlesi Koncesszios
Reszvenytarsasag as countersignor.
"Share Deposit Agreements" means each of the Share Deposit No. 1
Agreement, the Share Deposit No. 2 Agreement and any other share
deposit agreement designated as such in writing jointly by the Facility
Agent and any Obligor.
"Sponsors" means each of Hungarian Telephone and Cable Corp., HTCC
Tanacsado Reszvenytarsasag and Tele Danmark and "Sponsor" means any and
each of them.
"Sponsors' Support Agreement" means each of the sponsors' support
agreement dated on or about the date of this Agreement made between:
(1) Hungarian Telephone and Cable Corp.; (2) HTCC Tanacsado
Reszvenytarsasag; and (3) Postabank es Takarekpenztar Reszvenytarsasag
as beneficiary and Security Agent and the sponsor's support letter
dated on or about the date of this Agreement by Tele Danmark to
Postabank es Takarekpenztar Reszvenytarsasag.
"Tele Danmark" means Tele Danmark, a corporation duly incorporated
under the laws of Denmark, whose principal place of business is at
Xxxxxxxxxxx 00, XX 0000, Xxxxx-X, Xxxxxxx.
"Termination Date" means the earlier of the day which is five (5) days
after the date of this Agreement and the first business day on which
the Available Commitment of each of the Banks is zero (0).
"Transfer Certificate" means a certificate substantially in the form
set out in the Second Schedule (Form of Transfer Certificate) signed by
a Bank and a Transferee whereby:
(a) such Bank seeks to procure the transfer to such Transferee of
all or a part of such Bank's rights, benefits and obligations
under this Agreement as contemplated in Clause 25.3
(Assignments and Transfers by Banks); and
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(b) such Transferee undertakes to perform the obligations it will
assume as a result of delivery of such certificate to the
Facility Agent as is contemplated in Clause 25.5 (Transfers by
Banks).
"Transfer Date" means, in relation to any Transfer Certificate, the
date for the making of the transfer as specified in the schedule to
such Transfer Certificate.
"Transferee" means a bank or other financial institution to which a
Bank seeks to transfer all or part of such Bank's rights, benefits and
obligations under this Agreement.
"US Auditors" means, at any time, the auditors of Hungarian Telephone
and Cable Corp. at such time, being, as at the date of this Agreement,
KPMG LLP or any firm associated with the Borrowers' Auditors at such
time or such other internationally recognised firm of independent
auditors licensed to practice in the United States of America, duly
appointed by Hungarian Telephone and Cable Corp. to replace such firm
and approved in advance in writing by the Facility Agent, acting
reasonably.
"Warrants" means each warrant dated on or about the date of this
Agreement made between: (1) Hungarian Telephone and Cable Corp.; and
(2) Postabank es Takarekpenztar Reszvenytarsasag, issued pursuant to
the Securities Purchase Agreement.
1.2 Interpretation
Any reference in this Agreement to:
an "affiliate" shall be construed as a reference to a subsidiary or a
holding company of a person and any other subsidiary of that holding
company;
the "Arranger", the "Facility Agent", the "Security Agent", any "Bank",
any "Finance Party", the "Finance Parties", "Citizens Utilities
Company", "Tele Danmark", "IO Fund", "Beneficiary" or to any "Sponsor"
shall be construed so as to include its (and any participant's) and any
subsequent successors, Transferees, transferees, assigns and/or
replacements in accordance with their respective interests;
"assets" shall be construed so as to include properties, revenues
and rights of every description;
an "authorisation" shall be construed so as to include an
authorisation, consent, approval, permit, resolution, licence,
exemption, filing, registration, notarisation and similar proceeding;
a "business day" shall be construed as a reference to a day (other than
a Saturday or Sunday) on which: (i) banks generally are open for
banking business in Budapest and London; and (ii) if such reference
relates to a date for the payment or purchase of any sum denominated in
the Optional Currency, a day on which TARGET is open and fully
operational;
an "encumbrance" shall be construed as a reference to: (a) a mortgage,
charge, pledge, lien or other encumbrance or security interest
whatsoever securing any obligation of any person; (b) any arrangement
under which money or claims to, or the benefit of, a bank or other
account may be applied, set-off or made subject to a combination of
accounts so as to effect payment of sums owed or payable to any person
or (c) any other type of preferential arrangement (including title
transfer and retention arrangements) having a similar effect;
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the "equivalent" on any given date in one currency (the "first
currency") of an amount denominated in another currency (the "second
currency") is a reference to the amount of the first currency which
could be purchased with the amount of the second currency at the
arithmetic mean of the spot rates of exchange quoted by the Reference
Banks in Budapest to the Facility Agent at or about 9.15 a.m. (Budapest
time) on such date for the purchase of the first currency with the
second currency;
"HAS" shall be construed as a reference to accounting principles,
standards and practices generally accepted and implemented in Hungary
from time to time, as determined by the Auditors (acting as experts,
not as arbitrators);
a "holding company" of a company or corporation shall be construed as a
reference to any company or corporation of which the first-mentioned
company or corporation is a subsidiary;
"IAS" shall be construed as a reference to international accounting
standards issued by the International Accounting Standards Committee
from time to time as such international accounting standards are
accepted and implemented in Hungary from time to time, as determined by
the Auditors (acting as experts, not as arbitrators);
"indebtedness" shall be construed so as to include any obligation
(whether incurred as principal or as surety) for the payment or
repayment of money, whether present or future, actual or contingent;
"laws and regulations of Hungary" mean laws and regulations adopted in
accordance with Act XI of 1987 on law making, as amended, of Hungary;
a "month" is a reference to a period starting on one day in a calendar
month and ending on the numerically corresponding day in the next
succeeding calendar month save that, where any such period would
otherwise end on a day which is not a business day, it shall end on the
next succeeding business day, unless that day falls in the calendar
month succeeding that in which it would otherwise have ended, in which
case it shall end 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 (and references to "months" shall be construed
accordingly);
a "person" shall be construed as a reference to any person, firm,
company, corporation, government, state or agency of a state or any
association or partnership (whether or not having separate legal
personality) of two or more of the foregoing;
"repay" (or any derivative form thereof) shall, subject to any contrary
indication, be construed to include "prepay" (or, as the case may be,
the corresponding derivative form thereof);
a "subsidiary" of a company or corporation shall be construed as a
reference to any company or corporation:
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(a) which is controlled, directly or indirectly, by the first-
mentioned company or corporation;
(b) more than half the issued share capital of which is
beneficially owned, directly or indirectly, by the
first-mentioned company or corporation; or
(c) which is a subsidiary of another subsidiary of the first-
mentioned company or corporation
and, for these purposes, a company or corporation shall be treated as
being controlled by another if that other company or corporation is
able to direct its affairs and/or to direct and/or control the
composition of its board of directors or equivalent body;
"tax" shall be construed so as to include any tax, levy, impost, duty
or other charge of a similar nature (including any penalty or interest
payable in connection with any failure to pay or any delay in paying
any of the same);
"US GAAP" shall be construed as a reference to the general accounting
principles generally accepted in the United States of America from time
to time;
"VAT" shall be construed as a reference to value added tax including
any similar tax which may be imposed in place thereof from time to
time; and
the "winding-up", "dissolution" or "administration" of a company or
corporation shall be construed so as to include any equivalent or
analogous proceedings under the law of the jurisdiction in which such
company or corporation is incorporated or any jurisdiction in which
such company or corporation carries on business including the seeking
of bankruptcy, liquidation, final accounting, winding-up,
reorganisation, dissolution, administration, arrangement, adjustment,
protection or relief of debtors.
1.3 Currency Symbols "HUF" "Forint" "Ft", "Ft." and "forint" denote lawful
currency of Hungary and "Euros", "Euro", "euros", "euro" and "EUR" have
the meaning provided for in Clause 1.8 (The Euro).
1.4 Agreements and Laws and Regulations Any reference in this Agreement to:
(a) this Agreement or any other agreement or document shall, in
the absence of express wording to the contrary, be construed
as a reference to this Agreement or, as the case may be, such
other agreement or document as the same may have been, or may
from time to time be amended, varied, notated or supplemented;
and
(b) a statute, law, regulation or treaty shall, in the absence of
express wording to the contrary, be construed as a reference
to such statute or treaty as the same may have been, or may
from time to time be, amended or, in the case of a statute or
law, re-enacted.
1.5 Headings Clause, Part and Schedule headings are for ease of reference only.
1.6 Screen Rates For the purposes of the definition of "LIBOR":
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(a) "relevant page" means the relevant Telerate Page of the
Telerate Service which displays a British Bankers Association
Interest Settlement Rate for the relevant currency or, if such
page or such service shall cease to be available, such other
page or such other service (as the case may be) for the
purpose of displaying London Interbank Offered Rates for such
currency as the Facility Agent, after consultation with the
Banks and the Borrowers, shall select; and
(b) if no quotation for such currency and the relevant period for
which interest is to accrue are displayed and the Facility
Agent has not selected an alternative service on which two
or more such quotations are displayed, "LIBOR" shall mean
the arithmetic mean (rounded upwards, if not already such a
multiple, to the nearest whole multiple of one-sixteenth
of one per cent. (0.0625%)) of the rates (as notified to
the Facility Agent) at which each of the Reference Banks was
offering to prime banks in the London Interbank Market
deposits in such currency and for such period at or about
11.00 a.m. (London time) on the Quotation Date for such
period for which interest is to accrue.
1.7 Singular and Plural In this Agreement, words imparting the singular
shall be deemed to include the plural and vice versa.
1.8 The Euro For the purposes of this Agreement:
"EMU" means European Economic and Monetary Union as contemplated by the
Treaty;
"EMU Legislation" means the legislative measures of the Council of
European Union for the introduction of, changeover to, or operation of,
a single European currency (whether or not known as the euro), being in
part the implementation of the third stage of EMU;
"Euro", "Euros", "euros", "euro" and "EUR" means the single currency of
Participating Members States introduced on 1st January 1999;
"euro unit" means currency unit of the euro as defined in EMU
Legislation and "euro" means any of the foregoing;
"Participating Member State" means a member state of the European Union
that adopts a single currency in accordance with the Treaty; and
"TARGET" means the Trans-European Automated Real-time Gross settlement
Express Transfer, being the settlement system for the euro.
"Treaty" means the Treaty establishing the European Community being the
Treaty of Rome of 25th March 1957, as amended by the Single Xxxxxxxx
Xxx 0000 and the Maastricht Treaty (which was signed at Maastricht on
7th February 1992 and came into force on 1st November 1993), as further
amended from time to time.
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PART 2 - THE FACILITY
2. The Facility
2.1 Grant of the Facility The Banks grant to the Borrowers, upon the terms
and subject to the conditions of this Agreement, a bridge loan facility
in an aggregate amount of the equivalent of HUF thirty three billion
seven hundred million forints (HUF 33,700,000,000).
2.2 Purpose and Application The Facility is intended to be applied, inter
alia, towards the refinancing of existing indebtedness of various
members of the Group and the payment of the fees provided for in the
Fee Letter and, accordingly, the Borrowers shall apply all amounts
raised by them under this Agreement in or towards satisfaction of such
purpose Provided that amounts drawn down under this Agreement shall be
held by the Closing Agent subject to the terms and conditions of the
Master Closing Agreement Provided Further that none of the Finance
Parties nor any of them shall be obliged to concern themselves with
such application, other than as required by mandatory laws and
regulations of Hungary.
2.3 Conditions Precedent Documents Save as the Banks may otherwise agree,
the Borrower may not deliver the Notice of Drawdown under this
Agreement unless the Facility Agent has confirmed to each of the
Borrowers and the Banks that it has received all of the documents
listed in the Fourth Schedule (Conditions Precedent Documents) and that
each is, in form and substance, satisfactory to the Facility Agent.
2.4 Banks' Obligations Several The obligations of each Bank under this
Agreement are several and the failure by a Bank to perform its
obligations under this Agreement shall not affect the obligations of
the Borrower towards any other party to this Agreement nor shall any
other party be liable for the failure by such Bank to perform its
obligations under this Agreement.
2.5 Banks Rights Several The rights of each Bank under this Agreement are
several. Any amount(s) owed to a Bank under this Agreement shall
constitute several and independent obligations of the Borrower and such
Bank may enforce its rights arising under this Agreement without the
prior consent or approval of any other person.
2.6 Communications Through the Facility Agent The Facility Agent will act
as facility agent with the intent of administering the Facility and
centralising all communications between the Borrowers and the Finance
Parties and such communications will normally only be made through the
Facility Agent and all communications from any of the Finance Parties
to the Borrower will also only normally be made through the Facility
Agent Provided that an Instructing Group may in exceptional
circumstances be entitled to communicate directly with the Borrower.
3. Availability of the Facility
3.1 Drawdown Conditions The Advances will be made by the Banks to the
Borrowers if:
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(a) not more than three (3) nor less than one (1) business days
before the proposed date for the making of such Advances, the
Facility Agent has received from the Borrowers the Notice of
Drawdown in respect of such Advances, receipt of which shall
irrevocably oblige the Borrowers to borrow the amounts
requested in such Notice of Drawdown on the date stated in
such Notice of Drawdown upon the terms and subject to the
conditions contained in this Agreement;
(b) the proposed date for the making of such Advances is a
business day which is or which precedes the Termination Date;
(c) the proposed amount and currency of each of such Advances is
in accordance with the amounts and currencies set out in the
Notice of Drawdown and in aggregate do not exceed the amount
of the Available Facility;
(d) the interest rate applicable to any such Advances during its
first Interest Period would not fall to be determined pursuant
to Clause 6.1 (Market Disruption); and
(e) (i) no Event of Default or Potential Event of Default has
occurred and is continuing unremedied and unwaived; and (ii)
the representations set out in Clause 12 (Representations) are
true on and as of the proposed date for the making of such
Advances.
3.2 Each Bank's Participation Each Bank will participate through its
Facility Office in each Advance made pursuant to Clause 3.1 (Drawdown
Conditions): (i) prior to the making of the Advances, in the proportion
borne by its Available Commitment to the Available Facility immediately
prior to the making of that Advance; (ii) thereafter, in equal
proportions, as provided for in the relevant Transfer Certificate to
which such Bank is a party as Transferee.
3.3 Automatic Cancellation of Available Commitments Any amount of the
Available Facility undrawn at the end of the Availability Period shall
be automatically cancelled and the Available Commitment of each Bank at
such time shall be reduced to zero (0).
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PART 3 - INTEREST
4. Interest Periods
4.1 Interest Periods The period for which each Advance is outstanding shall
be divided into successive periods each of which (other than the first)
shall start on the last day of the preceding such period.
4.2 Duration The duration of each Interest Period shall, save as otherwise
provided in this Agreement, be one (1), three (3) months or six (6)
months duration, in each case as the Borrowers (acting together) may,
by not less than five (5) business days' prior written notice to the
Facility Agent, select Provided that:
(a) the duration of the first interest period in respect of the
Advances made under this Agreement shall be such that it ends
on the date six (6) months after the date of this Agreement;
(b) where any interest period would otherwise extend beyond the
Final Maturity Date, it shall be of such duration that it
shall end on the Final Maturity Date; and
(c) if the Borrowers fail to give such notice of its selection in
relation to an Interest Period, the duration of that Interest
Period shall, subject to paragraphs (a) and (b) below, be
three (3) months.
5. Payment and Calculation of Interest
5.1 Payment of Interest On the last day of each Interest Period, each
Borrower shall pay accrued interest on the Advances made to it to which
such Interest Period relates.
5.2 Calculation of Interest The rate of interest applicable to each Advance
from time to time during an Interest Period relating thereto shall be
the rate per annum which is the sum of the Margin and, if the Advance
is denominated in: (i) HUF, BUBOR; (ii) the Optional Currency, LIBOR;
or (iii) in the case of a currency other than HUF or euro, EURIBOR, in
each case on the Quotation Date therefor.
6. Alternative Interest Rates
6.1 Market Disruption If, in relation to any Advance:
(a) denominated in the Optional Currency and any Interest Period
relating thereto:
(i) LIBOR is to be calculated in accordance with
paragraph (b) of Clause 1.6 (Screen Rates) and the
Facility Agent determines that at or about 11.00 a.m.
(London time) on the Quotation Date for such Interest
Period only one or none of the Reference Banks was
offering to prime banks in the London Interbank
Market deposits in the Optional Currency for the
proposed duration of such Interest Period; or
(ii) before the close of business in London on the
Quotation Date for such Interest Period in respect of
such Advance, the Facility Agent has been notified by
a Bank or each of a group of Banks to whom in
aggregate thirty-five per cent. (35%) or more of the
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Advance is (or, if the Advance is undrawn Advance, if
the Advance were then made, would be) owed that the
rate at which such deposits were being so offered
does not accurately reflect the cost to it of
obtaining such deposits; or
(b) denominated in HUF:
(i) BUBOR is to be calculated in accordance with
paragraph (b) of the definition thereof set out in
Clause 1.1 (Definitions) and the Facility Agent
determines that at or about 11.00 a.m. (Budapest
time) on the Quotation Date for such Interest Period
only one or none of the Reference Banks was offering
to prime banks in the Budapest Interbank Market
deposits in HUF for the proposed duration of such
Interest Period; or
(ii) before the close of business in Budapest on the
Quotation Date for such Interest Period in respect of
such Advance, the Facility Agent has been notified by
a Bank or each of a group of Banks to whom in
aggregate thirty-five per cent. (35%) or more of the
Advance is (or, if the Advance is undrawn Advance, if
the Advance were then made, would be) owed that the
rate at which such deposits were being so offered
does not accurately reflect the cost to it of
obtaining such deposits,
then, notwithstanding the provisions of Clause 4 (Interest Periods)
and Clause 5 (Payment and Calculation of Interest):
(1) the duration of that Interest Period shall be one (1) month
or, if less, such that it shall end on the Final Maturity
Date; and
(2) if either paragraph (a) or (b) above applies, the rate of
interest, in the case a paragraph (a) above, applicable to the
Advance and in the case of paragraph (b) above, that portion
of the Advance owed to those Banks which have given notice to
the Facility Agent in accordance with paragraph (b) above,
from time to time during such Interest Period shall be the
rate per annum which is the sum of the Margin and the rate per
annum determined by the Facility Agent to be the arithmetic
mean (rounded upwards, if not already such a multiple, to the
nearest whole multiple of one-sixteenth of one per cent.
(0.0625%)) of the rates notified by each Bank to the Facility
Agent as soon as practicable, but in any event before the last
day of such Interest Period to be those which express as a
percentage rate per annum the cost to each Bank of funding
from whatever sources it may reasonably select its portion of
the Advance during such Interest Period.
6.2 Substitute Basis or Repayment If: (i) either of those events mentioned
at paragraphs (a) and (b) in Clause 6.1 (Market Disruption) occurs in
relation to any Advance(s) and an Interest Period during which such
Advance is (or was) to be outstanding; or (ii) in the case of an
Advance denominated in the Optional Currency, by reason of
circumstances affecting the London Interbank Market during any period
of three (3) consecutive business days none of the Reference Banks
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offers deposits in the Optional Currency to prime banks in the London
Interbank Market; or (iii) in the case of an Advance denominated in
HUF, by reason of circumstances affecting the Budapest Interbank Market
during any period of three (3) consecutive business days none of the
Reference Banks offers deposits in HUF to prime banks in the Budapest
Interbank Market, then:
(a) the Facility Agent shall as quickly as practicable notify the
Borrowers and the Banks of such event;
(b) if the Facility Agent so requires, within five (5) days
of such notification, the Facility Agent and the Borrowers
shall enter into negotiations with a view to agreeing a
substitute basis: (i) for determining the rates of
interest from time to time applicable to such Advance;
and/or (ii) upon which such Advance may be maintained
thereafter and any such substitute basis that is agreed
shall take effect in accordance with its terms and be
binding on each party to this Agreement Provided that
the Facility Agent may not agree any such substitute
basis without the prior consent of each Bank; and
(c) if the Facility Agent has required the Borrowers to enter into
such negotiations and within thirty (30) days the parties have
been unable to agree a substitute basis, the Facility Agent
may declare (any such declaration to be binding on the
relevant Borrower) that such Advance shall become due and
payable on the last day of its then current Interest Period
unless by then a substitute basis has been agreed in relation
thereto.
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PART 4 - REPAYMENT AND PREPAYMENT
7. Repayment
Each Borrower shall repay its portion of the Loan outstanding as at the
Final Maturity Date in full on the Final Maturity Date.
8. Prepayment
8.1 Prepayment A Borrower may, if it has given to the Facility Agent not
less than ten (10) business days' prior written notice to that effect,
prepay the whole of an Advance or any part of an Advance made to it
(being an amount such that the amount of such Advance will be reduced
by an amount or integral multiple of or equivalent to two hundred
million Forints (HUF 200,000,000), on the last day of any Interest
Period relating to that Advance.
8.2 Notice of Prepayment Any notice of prepayment given by a Borrower
pursuant to Clause 8.1 (Prepayment) shall be irrevocable, shall specify
the date upon which such prepayment is to be made and the amount of
such prepayment and shall oblige such Borrower to make such prepayment
on such date.
8.3 Repayment of a Bank's Share of the Loan If any Bank claims
indemnification from a Borrower under Clause 9.2 (Tax Indemnity) or
Clause 11.1 (Increased Costs) or if paragraph (a) (ii) or (b) (ii) of
Clause 6.1 (Market Disruption) applies to one or more but not all Banks
and within thirty (30) days thereafter the Facility Agent receives from
a Borrower at least ten (10) business days' prior written notice (which
notice shall be irrevocable) of a Borrower's intention to repay such
Bank's share of the Loan, such Borrower shall, on either the last day
of the then current Interest Period or on such other day agreed in
advance with the Facility Agent (acting in consultation with the
relevant Bank(s) and subject to the provisions of this Agreement,
including, inter alia, Clause 17.4 (Broken Periods)), repay such Bank's
portion of the Loan.
8.4 Mandatory Prepayment If any Borrower incurs any further Financial
Indebtedness whatsoever which is not expressly permitted and provided
for in any Finance Document to which it is a party prior to the Final
Maturity Date, such Borrower shall immediately apply all amount(s)
arising from such Financial Indebtedness towards the repayment of any
Advance(s) then made to such Borrower, with any excess amount to be
applied towards the repayment of any other Advance(s) then made to any
other Borrower as the Facility Agent shall require and direct.
8.5 No Other Repayments and no Reborrowing The Borrower shall only repay
all or any part of the Loan at the times and in the manner expressly
provided for in this Agreement and shall not be entitled to reborrow
any amount repaid or prepaid.
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PART 5 - CHANGES IN CIRCUMSTANCES
9. Taxes
9.1 Tax Gross-up All payments to be made by a Borrower to any person under
this Agreement shall be made free and clear of and without deduction
for or on account of tax unless such Borrower is required to make such
a payment subject to the deduction or withholding of tax, in which case
the sum payable by such Borrower in respect of which such deduction or
withholding is required to be made shall be increased to the extent
necessary to ensure that, after the making of the required deduction or
withholding, such person receives and retains (free from any liability
in respect of any such deduction or withholding) a net sum equal to the
sum which it would have received and so retained had no such deduction
or withholding been made or required to be made Provided that such
Borrower shall not be obliged to pay any additional amount under this
Clause 9.1 to any Bank to the extent that such additional amount would
not have been payable but for the relevant Bank either not being or
having ceased to be a Qualifying Bank otherwise than as a result of any
change in, or in the interpretation or application of, any relevant
law, directive, treaty (including any applicable double taxation
treaty) or regulation or practice of any relevant taxing authority
Provided Further that such Borrower's obligations contained in this
Clause 9.1 shall not extend to include tax, imposed by any taxing
authority in Hungary or other applicable jurisdiction, on the profits
and/or capital gains of a Bank.
9.2 Tax Indemnity Without prejudice to the provisions of Clause 9.1 (Tax
Gross-up), if any person or the Facility Agent on its behalf, becomes
liable to make any payment of or on account of tax (not being a tax
imposed on and calculated by reference to its overall net income or the
net income paid to and received by its Facility Office by the
jurisdiction in which it is incorporated or in which its Facility
Office is located) on or in relation to any sum received or receivable
under this Agreement by such person or the Facility Agent on its behalf
(including without limitation any sum received or receivable under this
Clause 9 (Taxes)) or any liability in respect of any such payment is
asserted, imposed, levied or assessed against such person or the
Facility Agent on its behalf, the relevant Borrower shall, upon demand
of the Facility Agent, promptly indemnify such person against such
payment or liability, together with any interest, penalties, costs and
expenses payable or incurred in connection therewith.
9.3 Indemnification If an additional payment is made under Clause 9.1 (Tax
Gross-up) or Clause 9.2 (Tax Indemnity) by a Borrower for the benefit
of any person under this Agreement and such person has received or been
granted an identifiable credit against, a relief or remission for, or
repayment of, any tax, then, if and to the extent that such credit,
relief, remission or repayment is in respect of or calculated with
reference to the deduction or withholding giving rise to such
additional payment or in the case of an additional payment made
pursuant to Clause 9.2 (Tax Indemnity), with reference to the
liability, expense or loss to which the payment giving rise to the
additional payment relates, such person shall, without prejudice to the
retention of the amount of such credit relief, remission or repayment,
pay to such Borrower such amount as is in the reasonable opinion of
such person attributable to such deduction or withholding or, as the
case may be, such liability, expense or loss Provided that such person
shall not be obliged to make any payment under this Clause 9.3 in
respect of such credit, relief, remission or repayment until its tax
affairs (to the extent they relate to such credit, relief, remission or
repayment) have been finally settled. Nothing in this Agreement shall
interfere with the right of any Bank to arrange its tax affairs in
whatsoever manner it thinks fit and, in particular, no Bank shall be
obliged to disclose any information relating to its tax affairs.
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9.4 Claims by Banks A Bank intending to make a claim pursuant to Clause 9.2
(Tax Indemnity) shall notify and explain to the Facility Agent of the
event by reason of which it is entitled to do so, whereupon the
Facility Agent shall notify the relevant Borrower(s) thereof Provided
that nothing in this Agreement shall require such Bank to disclose any
confidential information relating to the organisation of its affairs.
9.5 Qualifying Bank Each Bank represents and warrants to the Borrowers
that, as at the date of this Agreement, it is a Qualifying Bank and
such representation and warranty by such Bank shall, even if such Bank
ceases to be a Bank under this Agreement and notwithstanding any other
provision to the contrary contained in this Agreement, remain fully
effective against such Bank. If, at any time after this Agreement is
entered into, any Bank is aware that it is not or will cease to be a
Qualifying Bank, it shall promptly so notify the Borrowers and the
Facility Agent.
9.6 Qualifying Bank Certification The Facility Agent and each Qualifying
Bank (and if applicable, any Transferee of such Qualifying Bank) which
is not a Bank resident in Hungary for tax purposes under applicable
laws and regulations of Hungary shall prior to the first payments of
interest paid by the Borrowers for the benefit of the Banks under this
Agreement, provide to the Facility Agent for onward delivery to the
Borrowers a written certificate, issued by the relevant tax authorities
in which such Qualifying Bank is tax resident under applicable laws and
regulations, confirming that such Qualifying Bank is tax resident and
pays tax in such jurisdiction, such written certificate to be dated not
more than thirty (30) days before such first payment of interest under
this Agreement and in addition the Facility Agent and each Qualifying
Bank (and if applicable, any Transferee of such Qualifying Bank) shall
during the term of this Agreement provide such other documentation in
respect of such Qualifying Bank as may at any time be required under
applicable laws and regulations of Hungary and/or by the relevant
Hungarian tax authorities to avoid the making of a payment (additional,
or otherwise) by the Borrower under this Clause 9 (Taxes) Provided that
if such Qualifying Bank is a Transferee, such written certificate must
be dated no more than thirty (30) days before the first payment of
interest made by the Borrowers following such Transferee becoming a
Qualifying Bank Provided Further that the Facility Agent shall not
incur any liability whatsoever in respect of the failure by any Bank to
duly comply with its obligations under this Clause 9.6 or in respect of
such certification.
10. Tax Receipts
10.1 Notification of Requirement to Deduct Tax If, at any time, a Borrower
becomes aware that it is required by law to make any deduction or
withholding from any sum payable by it under this Agreement (or if
thereafter there is any change in the rates at which or the manner in
which such deductions or withholdings are calculated), such Borrower
shall promptly notify the Facility Agent in writing.
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10.2 Evidence of Payment of Tax If a Borrower makes any payment under this
Agreement in respect of which it is required to make any deduction or
withholding, it shall pay the full amount required to be deducted or
withheld to the relevant taxation or other authority within the time
allowed for such payment under applicable law and shall deliver to the
Facility Agent for each Bank, within thirty (30) days after it has made
such payment to the applicable authority, an original receipt (or a
certified copy thereof) issued by such authority evidencing the payment
to such authority of all amounts so required to be deducted or withheld
in respect of that Bank's share of such payment.
11. Increased Costs
11.1 Increased Costs If, by reason of: (i) any change in relevant law or in
its interpretation or administration after the date of this Agreement;
and/or (ii) compliance with any Capital Adequacy Requirement or any
other request from or requirement of any relevant central bank or other
fiscal, monetary or other authority generally applicable to financial
institutions and/or banks:
(a) a Bank or any holding company of such Bank is unable to obtain
the rate of return on its capital which it would have been
able to obtain but for such Bank's entering into or assuming
or maintaining a commitment or performing its obligations
(including its obligation to participate in the making of an
Advance) under this Agreement;
(b) a Bank or any holding company of such Bank incurs a cost as a
result of such Bank's entering into or assuming or maintaining
a commitment or performing its obligations (including its
obligation to participate in the making of an Advance) under
this Agreement;
(c) there is any increase in the cost to a Bank or any holding
company of such Bank of funding or maintaining all or any of
the loans comprised in a class of loans formed by or including
such Bank's share of the Advance; or
(d) a Bank or any holding company of such Bank becomes liable to
make any payment on account of tax (not being a tax imposed on
and calculated by reference to its overall net income or the
net income paid to and received by such Bank's Facility Office
by the jurisdiction in which it is incorporated or in which
its Facility Office is located) on or calculated by reference
to the amount of such Bank's share of the Advance and/or to
any sum received or receivable by it under this Agreement,
then the Borrowers shall, subject to Section 11.2 (Increased Costs
Claims), from time to time on demand of the Facility Agent, promptly
pay to the Facility Agent for the account of that Bank amounts
sufficient to hold harmless and indemnify that Bank or such Bank's
holding company from and against, as the case may be: (1) such
reduction in the rate of return of capital; (2) such cost; (3) such
increased cost (or such proportion of such increased cost as is, in the
opinion of that Bank, attributable to its participating in the funding
or maintaining of the Advance); or (4) such liability Provided that the
Borrowers shall not be obliged to make such a payment to the Facility
Agent for the account of any such Bank in compensation for such a
reduction in the rate of return of capital, cost, increased cost or
liability, where such reduction, cost, increased cost or liability is:
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(A) one in respect of which such Bank has been fully compensated
for pursuant any other provision of this Agreement; or
(B) attributable to any breach by such bank of any law or any
request from or requirements of any central bank or other
monetary, fiscal or other authority (whether or not having the
force of law, but, if not having the force of law, compliance
with which is in accordance with the usual practice of persons
to whom such request or requirement is intended to apply) to
which it is subject; or
(C) attributable directly to any change in the Bank's Facility
Office or any transfer and/or assignment of all or any part of
a Bank's interest in an Advance except those arising as a
consequence of any circumstances not prevailing or reasonably
foreseeable at the time of such change or transfer and/or
assignment.
11.2 Increased Costs Claims A Bank intending to make a claim pursuant to
Clause 11.1 (Increased Costs) shall, as quickly as practicable, notify
and provide a certificate which shall set out in reasonable detail the
basis of any such claim, details of the calculations (and workings) of
such claim and, if appropriate, supporting documentary evidence, to the
Facility Agent of the event by reason of which it is entitled to do so,
whereupon the Facility Agent shall, as quickly as practicable, notify
the Borrowers thereof and provide to the Borrowers a copy of such
certificate Provided that nothing in this Agreement shall require such
Bank to disclose any confidential information relating to the
organisation of its affairs.
11.3 Illegality Where the introduction, imposition or variation of any
applicable law or regulation or any change in the interpretation of any
such law or regulation makes it unlawful for a Bank to make, fund or
allow to remain outstanding all or part of its share of an Advance,
then that Bank shall, promptly after becoming aware of the same,
deliver to the relevant Borrower(s) through the Facility Agent a
written notice to that effect such notice setting out in reasonable
detail the reasons for such unlawfulness and:
(a) such Bank shall not thereafter be obliged to participate in
the making of the Advance and the amount of its Available
Commitment shall be immediately reduced to the extent of any
such illegality; and
(b) if the Facility Agent on behalf of such Bank so requires, the
Borrower shall on such date as the Facility Agent shall have
specified repay such Bank's share of the outstanding
Advance(s) together with accrued interest thereon and all
other amounts owing to such Bank under this Agreement and any
repayment so made shall reduce rateably the remaining
obligations of the Borrower under Clause 7 (Repayment).
11.4 Mitigation If circumstances are such that a Borrower is required to
gross-up any payment pursuant to Clause 9.1 (Tax Gross-up) and/or a
Bank intends to claim indemnification from a Borrower under Clause 9.2
(Tax Indemnity) or Clause 11.1 (Increased Costs) then, without in any
way limiting, reducing or otherwise qualifying the rights of such Bank
or such Borrower's obligations under any of the above mentioned
provisions, such Bank shall promptly upon becoming aware of the same
notify the Facility Agent thereof in writing and in consultation with
the Facility Agent and such Borrower, take such steps as such Bank in
its bona fide opinion considers appropriate to avoid or mitigate the
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effects of such circumstances Provided that such Bank shall be under no
obligation to take any such action if, in the bona fide opinion of such
Bank, to do so would or might have more than nominal adverse effect
upon its business, operation, financial condition or is likely to
involve the Bank in any expense, loss or tax disadvantage which is more
than nominal other than, in respect of a transfer by a Bank to an
affiliate made pursuant to this Clause 11.4, any such effect arising
solely as a result of such affiliate then being liable to a higher rate
of taxation on the net profits and/or capital gains arising in respect
of such participation in the Loan following such transfer by such Bank
to such affiliate.
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PART 6 - REPRESENTATIONS, COVENANTS AND EVENTS OF DEFAULT
12. Representations
Each Borrower makes each of the representations and warranties set out
in Clause 12.1 (Status and Due Authorisation) to Clause 12.23
(Corporate Chart) (inclusive) and acknowledges that the Facility Agent,
the Security Agent, the Arranger and each Bank has entered into this
Agreement in reliance on those representations and warranties. Each of
the representations set out in this Clause 12 shall be deemed to be
repeated on the day that any Advance is made under this Agreement and
on the first day of any Interest Period by reference to the facts and
circumstances then subsisting as if made at such time but so that any
reference to "on the date of this Agreement" in any representation
shall be construed as a reference to the date on which such
representation is repeated and if by such date any Borrower has
delivered financial statements to the Facility Agent in accordance with
its obligations under Clause 13.1 (Annual Statements) and Clause 13.2
(Semi-Annual Statements), references to the "Original Financial
Statements" in this Clause 12 shall be deemed to be references to the
then most recent financial statements delivered by such Borrower(s) to
the Facility Agent in accordance with its respective obligations under
Clause 13.1 (Annual Statements) and Clause 13.2 (Semi-Annual
Statements).
12.1 Status and Due Authorisation Each Borrower is a corporation duly
organised, incorporated and validly existing under the laws of Hungary
and each is a separate legal entity with perpetual corporate existence,
capable of suing and being sued, with power to enter into the Finance
Documents to which it is a party and to exercise its rights and perform
its obligations under and the transactions contemplated by the Finance
Documents to which it is a party and all corporate and other action
required to authorise its execution of the Finance Documents to which
it is a party and its performance of its obligations under the Finance
Documents to which it is a party has been duly taken.
12.2 Tax Save as otherwise disclosed in the 10K Document:
(a) the Original Financial Statements in respect of the Borrowers
fully reflect the tax position of each Borrower as at the
respective dates dated thereof;
(b) each Borrower has complied in all material respects with all
taxation laws in all jurisdictions in which it is subject to
taxation and has paid all taxes due and payable by it and no
material claims are being asserted against it with respect to
taxes; and
(c) on the assumption that the representation of each of the Banks
set out in Clause 9.5 (Qualifying Bank) is correct, under the
laws and regulations of Hungary in force at the date of this
Agreement, all amounts payable by it under this Agreement, may
be made free and clear of and without deduction for or on
account of any tax.
12.3 Claims Pari Passu Under the laws and regulations of Hungary in force at
the date of this Agreement, the claims of each Finance Party against
any Borrower under each of the Finance Documents to which such Borrower
and such Finance Party are a party will rank at least pari passu with
all the present and future claims of all such Borrower's other
unsecured and unsubordinated creditors save those whose claims are
preferred by the operation of mandatory Hungarian law applying to
companies generally in Hungary.
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12.4 Validity and Admissibility in Evidence All acts, conditions and things
required to be done, fulfilled and performed in order: (a) to enable
each Borrower lawfully to enter into, exercise its respective rights
under and perform and comply with the obligations expressed to be
assumed by it in each of the Finance Documents to which it is a party;
and (b) to ensure that the obligations expressed to be assumed by it in
such Finance Document, are legal, valid, binding and enforceable
against it have been done, fulfilled and performed.
12.5 No Filing or Stamp Taxes Under the laws and regulations of Hungary in
force at the date of this Agreement, other than the due registration of
the Fixed Charge Agreements and the Floating Charge Agreements in the
Register of Pledges with a Notary Public and the registration of the
Mortgage Agreements against the relevant land at the relevant Land
Registry (and the payment of all appropriate charges, duties, fees,
costs and expenses in respect of such registration), it is not
necessary that any Finance Document be filed, recorded or enrolled with
any court or other authority in Hungary or that any stamp, documentary,
registration or similar tax or charges be paid on or in relation to any
of the Finance Documents or (other than the court duties ("illetek")
expressly provided for under applicable laws and regulations of
Hungary) their enforcement in the courts of Hungary.
12.6 Binding Obligations The obligations expressed to be assumed by each
Borrower in each of the Finance Documents to which it is a party, are
legal and valid obligations, binding on and enforceable against it in
accordance with the terms of such Finance Documents, as appropriate.
12.7 Insolvency No Borrower has taken any formal corporate action nor to its
best knowledge and belief, having made reasonable enquires thereto,
have any other formal steps been taken or legal proceedings been
started or threatened in accordance with the procedures detailed in the
Bankruptcy Act or in the Companies Act (or in accordance with similar
or analogous provisions or proceedings) against it or against any other
member of the Group for its or for any such other member of the Group's
bankruptcy, liquidation, winding-up, dissolution, administration or
reorganisation or final accounting (in each case pursuant to the
Bankruptcy Act, the Companies Act or otherwise).
12.8 No Material Defaults Save as expressly disclosed to the Facility Agent
in writing prior to the date of this Agreement, including, inter alia,
those matters set out in the 10K Document, no Borrower is in breach of
or in default under any agreement (including, but not limited to, the
relevant Concession Contract) to which it is a party or which is
binding on it or any of its respective assets to an extent or in a
manner which would reasonably be expected to have a material adverse
effect on its respective business or financial condition or on its
ability to duly perform and/or comply with its obligations arising
under any of the Finance Documents to which it is a party.
12.9 Litigation Save as expressly disclosed to the Facility Agent in writing
prior to the date of this Agreement, including, inter alia, those
matters set out in the 10K Document, no material litigation,
arbitration, administrative proceedings or other actions whatsoever
involving a Borrower are current or, to the best of each Borrower's
knowledge and belief, having made all reasonable enquires thereto,
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pending or threatened, which would reasonably be expected to have (and
no judgement or order of any court or agency is outstanding which has),
a material adverse effect on the business or financial condition of a
Borrower, or a material adverse effect on the business or financial
condition of the Group taken as a whole, or a material adverse effect
on the ability of the Borrower to duly perform and/or comply with any
of its respective obligations and/or liabilities arising under any of
the Finance Documents to which it is a party, or a material adverse
effect on the ability of the Group taken as a whole to duly perform
and/or comply with any of their respective obligations and/or
liabilities arising under any of the Finance Documents to which any of
them is a party.
12.10 Original Financial Statements The Original Financial Statements were
prepared in accordance with US GAAP, HAS and IAS, as applicable,
consistently applied in Hungary and the United States of America, as
appropriate, and give (in conjunction with the notes thereto) a true
and fair view of the financial condition of each Borrower and the Group
at the date as of which they were prepared and the results of each
Borrower's and the Group's operations during the financial period then
ended, as applicable.
12.11 No Material Adverse Change Save as otherwise disclosed in the 10K
Document, since publication of the Original Financial Statements, there
has been no material adverse change in the business or financial
condition of any Borrower or to each Borrower's best knowledge and
belief the Group.
12.12 No Undisclosed Liabilities As at the date as of which the Original
Financial Statements were prepared no Borrower or, to each Borrower's
best knowledge and belief, no member of the Group had any liabilities
(contingent or otherwise) which were not disclosed thereby (or by the
notes thereto) or reserved against therein or to each Borrower's best
knowledge and belief, having made all reasonable enquiries thereto any
unrealised or anticipated losses arising from commitments entered into
by it which were not so disclosed or reserved against.
12.13 Full Disclosure All of the written information supplied by a Borrower
and/or any member of the Group to any Finance Party in connection with
this Agreement is true, complete and accurate in all material respects,
no events, facts and/or circumstances have arisen and/or occurred which
would reasonably be expected to have a material impact on any of the
written information supplied by a Borrower and any member of the Group
to any Finance Party (other than any which have been disclosed in the
10K Document or otherwise expressly disclosed to the Facility Agent,
together with a reasonably detailed written explanation of the
significance of such events, facts and/or circumstances within the
context of this proposed Facility) and no Borrower is aware of any
material facts or circumstances that have not been disclosed to the
Finance Parties which would reasonably be expected to, if disclosed,
adversely affect the decision of a prudent commercial bank considering
whether or not to provide finance to the Borrowers or to the Group.
12.14 Encumbrances Save as expressly permitted pursuant to Clause 15.8
(Negative Pledge), other than a Permitted Encumbrance, no encumbrance
exists over all or any of the present or future assets of a Borrower,
nor to each Borrower's best knowledge and belief, having made all
reasonable enquiries thereto, those of any member of the Group.
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12.15 No Obligation to Create Security Each Borrower's execution of any of
the Finance Documents to which it is a party and the exercise of its
respective rights and performance of its respective obligations under
such Finance Documents will not result in the existence of nor oblige
it to create any encumbrance over all or any of its respective present
or future assets, other than as expressly provided for in and
contemplated by the Finance Documents.
12.16 Execution of this Agreement Each Borrower's execution of this Agreement
and any other Finance Document to which it is a party and its exercise
of its respective rights and performance of its respective obligations
under this Agreement or such Finance Document do not and will not:
(a) conflict with any agreement, mortgage, bond or other
instrument or treaty or other document whatsoever to which a
Borrower is a party or which is binding upon it or any of its
assets in a manner or to an extent that would reasonably be
expected to have a material adverse effect on the ability of
the Borrower to duly perform and/or comply with any of its
respective obligations under this Agreement or such Finance
Document;
(b) conflict with the Constitutive Documents and rules and
regulations of the Borrower, as appropriate; or
(c) conflict with any applicable law, regulation or official or
judicial order to which the Borrower is subject.
12.17 Compliance with Laws and Regulations Each Borrower and, to the best of
its respective knowledge and belief, having made all reasonable
enquiries thereto, each member of the Group, in carrying out its
respective activities, business and operations is in all material and
substantial respects doing so in compliance with the relevant laws and
regulations governing the same.
12.18 No Event of Default or Potential Event of Default No Borrower is,
having made all reasonable enquiries thereto, aware of any
circumstances whatsoever which might constitute an Event of Default or
a Potential Event of Default, howsoever described or provided for,
under the terms of any of the Finance Documents which has not prior to
the date of this Agreement already been disclosed fully in writing to
the Facility Agent.
12.19 Entire Agreement No Borrower is, and to the best of each Borrower's
knowledge and belief, having made all reasonable enquiries thereto, no
member of the Group is a party to any material agreement or contract
whatsoever (oral, written or otherwise) which is or which would
reasonably be expected to become material to the Facility and/or the
security interests created and/or constituted by the applicable
Security Agreements, which is not expressly provided for in any of the
Finance Documents and/or which has not been disclosed in the 10K
Document or otherwise fully and properly disclosed in writing prior to
the date of this Agreement to the Facility Agent.
12.20 Environment Each Borrower and, to the best of its knowledge and belief,
each member of the Group is in compliance in all material respects
with:
(a) all material applicable laws and regulations concerning the
protection of the environment and to the best of its knowledge
and belief, having made reasonable enquires thereto, there are
no circumstances which may prevent that compliance in the
future; and
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(b) the terms of all material permits and authorisation required
by any applicable environmental laws and regulations for the
ownership and operation of its businesses.
12.21 Year 2000 Compliance Save as otherwise disclosed in the 10K Document,
to the best of each Borrower's knowledge and belief, having made all
reasonable enquiries thereto, the so-called Year 2000 problem (that is,
the possibility that any computer hardware, computer software and/or
any other equipment or service whatsoever, operated and/or controlled
by electronic means, used, manufactured, sold, delivered or otherwise
provided to or by, any member of the Group may be unable to properly
recognise and/or properly perform date-sensitive functions, commands
and/or calculations involving a date before, on or after 31 December
1999) will not have a material adverse effect on the ability of any
member of the Group to duly perform and/or comply with each of its
respective obligations arising under any Finance Document to which such
member of the Group is a party.
12.22 Management of Business No Borrower has, nor to its best knowledge and
belief having made all reasonable enquiries thereto has any member of
the Group, entered into any management contract or similar arrangement
whereby a material part of its or the Group's business or operations
are managed or are to be managed by any other person which might have a
material adverse effect on the ability of any member of the Group to
duly perform and/or comply with any of its obligations under any
Finance Document to which it is a party except those management
contracts or similar arrangements which have been fully and fairly
disclosed in writing prior to the date of this Agreement to each of the
Finance Parties.
12.23 Corporate Chart The chart to be provided by the Borrowers, detailed
under paragraph numbered 31 in the Fourth Schedule (Conditions
Precedent Documents), showing the ownership of each member of the Group
and the relationship of the Group with the other Obligors is true and
correct in all respects as at the date of this Agreement and that no
member of the Group has any form of equity and/or ownership interest
whatsoever in any other person except as so disclosed in such chart.
13. Financial Information
13.1 Annual Statements Each Borrower shall, as soon as the same become
available, but in any event within one hundred and fifty (150) days
after the end of each of its financial years, deliver to the Facility
Agent in sufficient copies for the Banks its audited financial
statements (including, inter alia, balance sheet, profit and loss
statement and cash-flow movements statement) for such financial year,
prepared in accordance with HAS and, if they are being prepared,
promptly once they are available the foregoing prepared in accordance
with IAS and/or US GAAP. Each Borrower shall as soon as the same become
available, but in any event within sixty (60) days after the end of
each of its financial years, deliver to the Facility Agent in
sufficient copies for the Banks its unaudited financial statements
(including, inter alia, balance sheet, profit and loss statement and
cash-flow movements statement) for such financial year, prepared in
accordance with HAS and, if they are being prepared, promptly once they
are available the foregoing prepared in accordance with IAS and/or US
GAAP.
13.2 Semi-Annual Statements The Borrower shall, as soon as the same become
available, but in any event within sixty (60) days after the end of the
first half of each of its financial years, deliver to the Facility
Agent in sufficient copies for the Banks its financial statements
(including, inter alia, balance sheet and profit and loss statement)
for such half-year prepared in accordance with HAS and, if they are
being prepared, promptly once they are available the foregoing prepared
in accordance with IAS and/or US GAAP.
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13.3 Management Accounts Each Borrower shall, as soon as the same become
available but in any event within twenty (20) days, or earlier if
provided to Tele Danmark, after the end of each month and each quarter,
as applicable, of each of its financial years, deliver to the Facility
Agent in sufficient copies for the Banks, its monthly and its quarterly
management accounts for such period, such accounts to include adequate
detail to the satisfaction of the Facility Agent.
13.4 Business Plan Each Borrower shall, as quickly as practicable, but in
any event within fourteen (14) days after the making of any amendment
to its Business Plan, deliver to the Facility Agent in sufficient
copies for the Banks, such amended Business Plan for the outstanding
term of this Agreement, together with a written explanation of the
rationale and effect of such change(s) to the reasonable satisfaction
of the Facility Agent.
13.5 Annual Operating Budget Each Borrower shall, as quickly as practicable,
but in any event within fourteen (14) days after the approval of the
Annual Operating Budget in respect of a financial year, deliver to the
Facility Agent in sufficient copies for the Banks of such Annual
Operating Budget(s), together with a written explanation of such Annual
Operating Budget(s).
13.6 Copies of Notifications to Shareholders Each Borrower shall, as soon as
the same become available, deliver to the Facility Agent in sufficient
copies for the Banks, copies of its annual budget and financial
projections prepared for its shareholders from time to time Provided
that were there is no significant discrepancy between such information
to be provided to its shareholders and that already provided to the
Facility Agent in accordance with other provisions in this Agreement,
such Borrower shall not be obliged to provide such annual budget and
financial projections to the Facility Agent under this Clause 13.6.
13.7 Other Financial Information Each Borrower shall, from time to time on
the request of the Facility Agent (or a Bank through the Facility
Agent), furnish the Facility Agent with such information (including but
not limited to its extract of general ledger ("fokonyvi kivonat"))
about its business and financial condition or that of any of its
subsidiaries as the Facility Agent may reasonably require Provided that
if such Borrower is able to immediately furnish such information albeit
in a format and/or presentational format then used by the relevant
internal functions of such Borrower, such Borrower will immediately
furnish such information to the Facility Agent (or such Bank through
the Facility Agent) in such format and/or presentational format
Provided Further that if such format and/or presentational format is
not acceptable to the Facility Agent or such Bank, acting reasonably,
such Borrower will as quickly as practicable and in any event within
fourteen (14) days, provide the Facility Agent or such Bank, as
applicable, such information in a format and/or presentational format
reasonably requested by the Facility Agent or such Bank, as applicable.
13.8 Requirements as to Financial Statements Each Borrower shall ensure that:
(a) each set of financial statements delivered by it pursuant to
this Clause 13 (Financial Information) is prepared on the same
basis as was used in the preparation of the Original Financial
Statements and in accordance with US GAAP, IAS or HAS, as
appropriate, consistently applied in Hungary;
(b) each set of financial statements delivered by it pursuant to
this Clause 13 (Financial Statements) is certified by a duly
authorised officer of such Borrower as giving a true and fair
view of its financial condition as at the end of the period to
which those financial statements relate and of the results of
its operations during such period; and
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(c) each set of audited financial statements delivered by it
pursuant to Clause 13.1 (Annual Statements) has been audited
by the Borrowers' Auditors.
13.9 Accounting Terms All accounting expressions which are not otherwise
defined in this Agreement shall be construed in accordance with US
GAAP, IAS and/or HAS, as appropriate, consistently applied in Hungary
and/or the United States of America, as applicable.
14. Financial Covenants
14.1 Financial Condition of the Group At: (a) the date of this Agreement the
Group's Debt to EBITDA Ratio shall not exceed 7.5:1; (b) the Group's
Debt to EBITDA Ratio shall not exceed 7.0:1 as at 30 September 1999;
and (c) as at 31 December 1999 the Group's Debt to EBITDA Ratio shall
not exceed 6.5:1 (in each case calculated by reference to the
applicable quarterly consolidated financial statements for the Group
delivered to the Facility Agent pursuant to this Agreement and/or the
Sponsor's Support Agreement).
14.2 Definitions of Financial Terms In Clause 14.1 (Financial Condition of
the Group), the Group's Debt to EBITDA Ratio shall be calculated as
follows:
A = B / C
where:
A = the Group's Debt to EBITDA Ratio at such time;
B = the amount of the Loan at such time plus the aggregate of
any other amount(s) then outstanding under any other of the
Group's indebtedness falling due and payable more than twelve
(12) months after such time (but expressly excluding any such
amount(s) which is (are) repayable under a Note; and
C = the amount of the Group's net earnings for the preceding
period of twelve (12) months plus the aggregate of any
and all amount(s) in respect of: (i) extraordinary items,
if any including, inter alia, any amount(s) in respect of the
termination of management services agreement charges
so deducted; (ii) depreciation and amortisation, if any;
(iii) foreign exchanges gains or losses, if any (such that
foreign exchange losses are applied as a positive number
and vice versa); (iv) taxes, if any; (v) net interest and
expenses paid by any member of the Group in respect of any
Financial Indebtedness; (in each case, such amount(s) to be
in respect of such preceding period of twelve (12) months)
Provided that for the avoidance of doubt, it is
expressly agreed that any Distribution(s) paid by any member
of the Group during such preceding period of twelve (12)
months is not to be added back for the purposes of
calculating the value of C in this formula.
14.3 Compliance with Financial Condition The Borrowers will procure the
delivery to the Facility Agent of written certificates, certified by
the Chief Financial Officer of the Group, confirming that the Group is
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in compliance with the requirements of Clause 14.1 (Financial Condition
of the Group), such certificates to be delivered to the Facility Agent
within forty five (45) days of 30 September 1999 and 31 December 1999.
By signing this Agreement and by issuing (or being deemed to have
issued) the Notice of Drawdown, each Borrower certifies (or is deemed
to certify) that the Group is in compliance with the requirements of
Clause 14.1 (Financial Condition of the Group) as at such date.
15. Covenants
15.1 Maintenance of Legal Validity Each Borrower shall obtain, comply with
the terms of and do or, as appropriate, procure the obtaining,
compliance with the terms of and the doing of all that is necessary to
maintain in full force and effect all authorisations, approvals,
licences and consents required in or by the laws and regulations of
Hungary or by other applicable laws to enable it lawfully to enter into
and perform its respective obligations under the Finance Documents to
which it is a party and to ensure the legality, validity,
enforceability or admissibility in evidence in Hungary of such Finance
Documents including, but not limited to, duly registering the Fixed
Charge Agreements and the Floating Charge Agreements with a Notary
Public and duly registering the Mortgage Agreements at the relevant
Land Registries.
15.2 Insurance Each Borrower shall take out and maintain insurances on and
in relation to its respective activities, business, operations and
assets with reputable underwriters or insurance companies against such
risks and to such extent as is usual and is available upon commercial
terms in Hungary for companies carrying on similar activities,
businesses and operations such as those carried on by it and its
subsidiaries whose practice is not to self-insure. Each Borrower as
quickly as practicable shall, upon it taking out any such insurance
pursuant to this Clause 15.2, notify the Facility Agent, providing
sufficient information on such insurance as reasonably required by the
Facility Agent and execute an assignment of contractual rights
agreement in respect of such material insurance, substantially in the
form of the Assignment of Contractual Rights Agreements, as
appropriate, if the Facility Agent (acting on the instructions of an
Instructing Group, acting reasonably) so requires. The Borrower shall
also not act or fail to act in any way which could by such action or
failure to act cause any material adverse effect on the validity and
enforceability of such insurances. In the event that circumstances
arise whereby a Borrower intends to make a material claim under such
insurance policies, such Borrower will promptly notify the Facility
Agent of such circumstances, together with an estimate of the amount of
the damage or loss and an estimate of the likely amount of such claim
and as soon as reasonably practicable thereafter enter into
negotiations in good faith with the Facility Agent in order to
determine an appropriate strategy for the use of any monies paid out as
a result of such a claim.
15.3 Untrue Representations After the delivery or deemed delivery of the
Notice of Drawdown and before the making of the Advances requested
therein, each Borrower shall immediately notify the Facility Agent of
the occurrence of any event or circumstance which results in or which
would reasonably be expected to result in any of the representations
contained in Clause 12 (Representations) being untrue at or before the
time of the making of such Advance.
15.4 Notification of Events of Default Each Borrower shall, promptly upon
becoming aware of such occurrence, inform the Facility Agent of the
occurrence of any Event of Default or Potential Event of Default,
howsoever described under any of the Finance Documents and, upon
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receipt of a written request to that effect from the Facility Agent,
confirm to the Facility Agent that, save as previously notified to the
Facility Agent or as notified in such confirmation, no Event of Default
or Potential Event of Default, howsoever described under any of the
Finance Documents, has, to the best of its knowledge and belief, having
made all reasonable enquiries thereto, occurred.
15.5 Claims Pari Passu Each Borrower shall, subject to any Permitted
Encumbrances, ensure that at all times the claims of each Finance Party
against it under the Finance Documents to which it is a party rank at
least pari passu with the claims of all its other unsecured and
unsubordinated creditors save those whose claims are preferred by the
operation of mandatory laws and regulations of Hungary, applying to
companies generally in Hungary.
15.6 Auditors No Borrower shall, without the prior written consent of the
Facility Agent (such consent not to be unreasonably withheld) change or
propose to/at such Borrower's founder or general meeting, as
applicable, the changing of such Borrower's Hungarian or other auditors
except as provided for in the definition of Borrowers' Auditors in
Clause 1.1 (Definitions).
15.7 Bank Accounts No Borrower shall, without the prior written consent of
the Facility Agent, open, have, maintain or otherwise operate at any
time a bank account (or similar account) with a bank or other financial
institution except for an Income Account or any other bank account with
the Facility Agent, or pay, or procure the payment of, or allow or fail
to take all necessary steps to prevent the payment of any or all of its
Income whatsoever into any bank account (or similar account) at and/or
with any other bank or financial institution other than the Income
Account held with the Facility Agent.
15.8 Negative Pledge No Borrower shall, without the prior written consent of
the Facility Agent, acting reasonably, create or permit to subsist any
encumbrance over all or any of its respective present or future
revenues or assets, other than as provided for in the Finance Documents
or an encumbrance which is a Permitted Encumbrance.
15.9 Loans and Guarantees No Borrower shall, without the prior written
consent of the Facility Agent, such consent not to be unreasonably
withheld or delayed, make any loans, grant any credit or give any
guarantee or indemnity whatsoever (except as required or provided for
under any Finance Document or to or in favour of an affiliate or made
in the ordinary course of business (which does not when aggregated with
all other such loans, credits, guarantees or indemnities given by any
Member of the Group at any time exceed the equivalent of five hundred
million Forints (HUF 500,000,000) or made in the context of such
Borrower's collective agreement made with the relevant trade union in
respect of such Borrower's employees) to or for the benefit of any
person whatsoever or otherwise voluntarily assume any liability
whatsoever, whether actual or contingent, in respect of any obligation
of any other person. Each Borrower shall, at all times, ensure that any
and all indebtedness of such Borrower with either or both of Hungarian
Telephone and Cable Corp. and/or HTCC Tanacsado Reszvenytarsasag is at
all times and in all respects fully subordinated to any indebtedness
and/or other obligation of such Borrower owing or expressed to be in
favour of any Finance Party Provided that it is expressly acknowledged
and agreed that any such subordinated indebtedness may be converted
into equity share capital of such Borrower, with such Borrower being
entitled to take all the appropriate legal and practical steps
necessary to effect such conversion.
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15.10 Shares No Borrower shall, without the prior written consent of the
Facility Agent, such consent not to be unreasonably withheld or
delayed, alter any rights attaching to its issued ordinary shares in
existence at the date of this Agreement.
15.11 Disposals No Borrower shall, sell, lease, transfer or otherwise dispose
of, by one or more transactions or series of transactions (whether
related or not) any of its revenues and/or assets, other than any such
transaction(s) being Permitted Disposal(s).
15.12 Distributions No Borrower shall, at any time, without the prior written
consent of the Facility Agent, acting reasonably, propose to/at such
Borrower's founder or general meeting, as applicable, the paying,
making or declaring of any Distribution other than a Permitted
Distribution. The Borrower acknowledges that the Obligors have also
undertaken in the Sponsors' Support Agreement that no Borrower will,
without the prior written consent of the Facility Agent, acting
reasonably, propose at/to a Borrower's founder or general meeting, as
applicable, the paying, making or declaring of any Distribution other
than a Permitted Distribution, in respect of any financial year of the
Borrower, or pass such resolution, and, in accordance with the terms of
the Sponsors' Support Agreement, each Borrower agrees that it shall
not, without the prior written consent of the Facility Agent, acting
reasonably, pay or make any Distribution other than a Permitted
Distribution, in respect of any financial year of such Borrower.
15.13 Merger No Borrower shall, without the prior written consent of the
Facility Agent, acting reasonably, merge or consolidate or be a party
to any similar transaction whatsoever with any other person other than
a Borrower.
15.14 Reduction of Capital No Borrower shall, without the prior written
consent of the Facility Agent, acting reasonably, propose to/at any
Borrower's founder or general meeting, as applicable, the reduction of
such Borrower's registered and paid-up share capital Provided that any
capital reduction which eliminates any negative equity of any Borrower
existing as at the date of this Agreement shall not breach this
covenant. Each Borrower acknowledges that certain Obligors have also
undertaken in the Sponsors' Support Agreement that such Obligors will
not, without the prior written consent of the Facility Agent, acting
reasonably, propose at/to any Borrower's founder or general meeting, as
applicable, the reduction of such Borrower's registered and paid-up
share capital, or pass such resolution and, in accordance with the
terms of such Sponsors' Support Agreement, each Borrower agrees that it
shall not take any action or steps whatsoever to facilitate the
reduction of its registered and paid-up share capital without the prior
written consent of the Facility Agent, acting reasonably.
15.15 Material Contracts No Borrower shall, without the prior written consent
of the Facility Agent, acting reasonably, enter into any material
agreement(s) and material contract(s) which is entered into on business
terms that are worse than at arm's-length and/or which would be
reasonably likely to have a material adverse effect on the ability of
any Borrower to perform its obligations under any of the Finance
Documents to which it is a party or a material adverse effect on the
ability of the Group, taken as a whole to perform any of their
respective obligations under any of the Finance Documents to which any
member of the Group is a party.
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15.16 Revocation No Borrower shall, without the prior written consent of the
Facility Agent, take any formal action or fail to perform any duty or
obligation which is likely to lead to the revocation of any Finance
Document to which such Borrower is a party or to the cancellation or
suspension of the rights of such Borrower included in any such
agreement.
15.17 New Business No Borrower shall, without the prior written consent of
the Facility Agent, acting reasonably, create any subsidiaries and/or
become a party to a joint venture agreement or arrangement and/or enter
or become involved in areas or types of activities or business in each
such case that would fall outside the scope of activities and business
specifically provided for pursuant to the Concession Contracts or
activities and business related to the telecommunications business
which are specified in Government Decree Number 48 of 1997 which are
significantly different to those currently being carried on by the
Borrowers and as envisaged in the Finance Documents, the overall effect
of which would be reasonably expected to change the overall nature of
the credit risk of the Borrowers, as determined by the Facility Agent,
acting reasonably.
15.18 Articles of Association No Borrower shall, without the prior written
consent of the Facility Agent, acting reasonably, propose to/at any
Borrower's founder or general meeting, as applicable, an amendment to
its Articles of Association which would reasonably be expected to have
a material adverse effect on the ability of such Borrower to duly
perform and comply with its obligations under any Finance Document to
which it is a party.
15.19 Mitigation of Interest Rate and Forex Risks Upon or prior to the
execution of this Agreement and continually throughout the term of this
Agreement, the Borrowers will, in accordance with sound and prudent
business practices, carefully consider and review the management of
interest rate and foreign exchange risks arising as a result of the
Borrowers' business and activities (including, but not limited to, the
Borrowers entering into this Agreement and receiving Advance(s) under
this Agreement), with a view to devising a strategy for the mitigation
of such risks. The Borrowers shall as soon as practical notify the
Facility Agent of their strategy for the management and mitigation of
such interest rate arising as a result of the Borrowers' business and
activities (including, but not limited to, the Borrowers entering into
this Agreement and receiving Advance(s) under this Agreement), and of
any and all subsequent amendments to that strategy and provide such
evidence as may be reasonably required by the Facility Agent that such
strategy has been duly and properly implemented. Each Borrower
expressly acknowledges and accepts the terms of this Clause 15.19.
15.20 Alteration or Amendment of Finance Documents No Borrower shall alter or
amend, or cause to be altered or amended, any of the Finance Documents
to which it is a party, without the prior written consent of the
Facility Agent or if expressly provided for in such a Finance Document,
all of the Banks Provided that each Borrower will take any actions or
other steps required under applicable laws and regulations to give full
force and effect to the Finance Documents (and to the rights, security
interests and encumbrances created therein) to which it is a party.
15.21 Filing of Tax Returns Each Borrower shall file or cause to be filed all
tax returns required to be filed in all jurisdictions in which it
and/or any of its subsidiaries is situated or carries on business or
otherwise subject to pay tax and will promptly pay all taxes which are
due and payable on such returns or any assessment made against it
except to the extent contested in good faith Provided that a Borrower
will notify the Facility Agent as soon as practicable after such
Borrower decides to contest the amount of tax due and/or payable by it.
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15.22 Amount of Advance Specified in the Notice of Drawdown Each Borrower
will ensure that the amounts specified in the issued or deemed to be
issued Notice of Drawdown is in full accordance with the amount(s) set
out in the Third Schedule (The Notice of Drawdown).
15.23 Environment Each Borrower shall comply in all material respects with:
(a) all material applicable laws and regulations concerning the
protection of the environment; and
(b) the terms of all material permits and authorisation required
by any applicable environmental laws and regulations for the
ownership and operation of its or such subsidiary's, as
appropriate, business.
15.24 Compliance with Laws and Regulations In carrying out its activities,
business and operations each Borrower will, in all material and
substantial respects, do so in compliance with the relevant laws and
regulations of Hungary or other applicable jurisdictions governing the
same.
15.25 No New Financial Indebtedness No Borrower shall make or enter into any
agreement or arrangement whatsoever whereby in aggregate any new
Financial Indebtedness will be created, established or incurred, by the
Borrowers or any of them, which is in excess of an amount equivalent to
one million dollars (U.S.$ 1,000,000), without the prior written
consent of the Facility Agent, such consent not to be unreasonably
withheld and a decision to be confirmed to such Borrower within thirty
(30) days after the date of receipt of such written request from such
Borrower Provided that any such new Financial Indebtedness is
immediately applied pursuant to Clause 8.4 (Mandatory Prepayment)
Provided Further that a Borrower, shall be entitled to incur additional
Financial Indebtedness in respect of the implementation of the risk
management strategy of the Borrower, which is in compliance with Clause
15.19 (Mitigation of Interest Rate and Forex Risks).
15.26 Stamp Taxes Each Borrower will as quickly as practicable upon becoming
aware of any requirement to do so (including following the receipt of
written notification by the Facility Agent in respect thereof) take
and/or procure the taking of all actions required to be done, fulfilled
or performed in order to pay any stamp, registration or similar tax or
charges arising under any of the Finance Documents, in Hungary.
15.27 Litigation Each Borrower will, promptly upon becoming aware of the
same, notify the Facility Agent in writing of any material litigation,
arbitration, administrative proceedings or other actions, whatsoever,
involving such Borrower not previously disclosed to each Finance Party
pursuant to this Agreement including, inter alia, in the 10K Document
which would reasonably be expected to have a material adverse effect on
the business or financial condition of such Borrower or a material
adverse effect on the business or financial condition of the Group
taken as a whole or a material adverse effect on the ability of such
Borrower to duly perform and/or comply with any of its obligations
arising under any of the Finance Documents to which it is a party, or a
material adverse effect on the ability of the Group taken as a whole to
duly perform and/or comply with any of their respective obligations
arising under any Finance Document to which any of them is a party.
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15.28 Year 2000 Compliance
(a) Each Borrower will take all best efforts to ensure that any
programming required to permit the proper functioning, in all
material respects, in and following the year 2000 of:
(i) such Borrower's computer systems; and
(ii) equipment of such Borrower containing embedded
microchips which is material to their respective
business,
and the testing of all such systems and equipment as so
reprogrammed will be completed by 30 November 1999; and
(b) each Borrower will inform the Facility Agent as quickly as
possible upon becoming aware that the cost to such Borrower
of such reprogramming and testing and the reasonably
foreseeable consequences to such Borrower of any errors
therein would in all reasonable likelihood give rise to an
Event of Default or have, in all reasonable likelihood,
a material adverse effect on the ability of such Borrower
to perform or comply with its obligations under the Finance
Documents to which it is a party or on the ability of the
Group, taken as a whole, to perform or comply with their
respective obligations under the Finance Documents to which
any of them are a party.
16. Events of Default
Each of Clause 16.1 (Failure to Pay) to Clause 16.19 (Failure to comply
with Final Judgment) (inclusive) describes circumstances which
constitute an Event of Default for the purposes of this Agreement.
Clause 16.20 (Acceleration and Cancellation) and Clause 16.21 (Advance
Due on Demand) deal with the rights of the Facility Agent and the Banks
after the occurrence of an Event of Default.
16.1 Failure to Pay Any Borrower fails to pay any sum due from it under this
Agreement at the time, in the currency and in the manner specified in
this Agreement and in the event that such failure arises for technical
or administrative reasons it continues for two (2) business days after
the Facility Agent has given notice thereof to the Borrower.
16.2 Misrepresentation Any representation or statement made by any Obligor
in any of the Finance Documents to which such Obligor is a party, or in
any notice or other document, certificate or written statement
delivered by it to the Facility Agent pursuant to this Agreement or in
connection with this Agreement is or proves to have been incorrect or
misleading when made or deemed to be made, in a manner which would
reasonably be expected to have a material adverse effect on the ability
of any Obligor to duly perform or comply with any of its obligations
under the Finance Documents to which it is a party or on its business
or financial condition and, if the fact that such representation or
statement is so incorrect or misleading is capable of remedy, such fact
is not remedied within fourteen (14) days or, if in order to effect
such remedy, an application must be made to an organ, agency or other
administrative or regulatory body of Hungary, then such period shall be
extended to thirty (30) days.
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16.3 Specific Covenants The Borrower fails duly to perform or comply with
any of the obligations expressed to be assumed by it in Clause 15
(Covenants) and such failure, if capable of remedy, is not remedied
within fourteen (14) days of such failure or, if in order to effect
such remedy, an application must be made to an organ, agency or other
administrative or regulatory body of Hungary, then such period shall be
extended to thirty (30) days.
16.4 Other Obligations Any Obligor fails duly to substantially and
materially perform or comply with any other obligation which is deemed
to be material by the Facility Agent, acting reasonably and in good
faith, expressed to be assumed by it in any of the Finance Documents to
which it is a party and such failure, if capable of remedy, is not
remedied within twenty-five (25) days or, if in order to effect such
remedy, an application must be made to an organ, agency or other
administrative or regulatory body of Hungary, then such period shall be
extended to thirty (30) days.
16.5 Litigation Any new litigation, arbitration, administrative proceedings
or other activities whatsoever are commenced against any Borrower
and/or any other member of the Group or the nature of any existing such
proceedings changes in any way whatsoever which would reasonably be
expected to, in the opinion of the Facility Agent, acting reasonably,
have a material adverse effect on the ability of such Borrower and/or
such other member of the Group to duly perform and/or comply with any
of its respective obligations and/or liabilities arising under any of
the Finance Documents to which it is a party and which such Borrower
and/or such other member of the Group fails within a reasonable period
of time (as determined by the Facility Agent, acting reasonably) to
demonstrate, to the reasonable satisfaction of the Facility Agent,
acting reasonably, that it is contesting such proceedings or activities
in good faith and that such contesting has a reasonable expectation of
being successful and/or that the reasonably anticipated monetary value,
cost or other expense of such claim(s) individually does not exceed the
equivalent of three hundred million Forints (HUF 300,000,000) and in
aggregate do(es) not exceed the equivalent of four hundred and fifty
million Forints (HUF 450,000,000) when aggregated with the amount, if
any, of Financial Indebtedness to which the operative provisions of
Clause 16.6 (Cross Default) then applies.
16.6 Cross Default Any Financial Indebtedness of an Obligor, is not paid
when due, any Financial Indebtedness of an Obligor is declared to be or
otherwise becomes due and payable prior to its specified maturity as a
result of the default (howsoever described or provided for) of such
Obligor or any creditor or creditors of an Obligor become entitled to
declare any Financial Indebtedness of such Obligor due and payable
prior to its specified maturity as a result of the default (howsoever
described or provided for) of such Obligor where the amount of such
Financial Indebtedness, in aggregate, exceeds the equivalent of one
hundred and fifty million Forints (HUF 150,000,000) when aggregated
with the anticipated monetary value, cost or other expense of all then
applicable claims provided for in Clause 16.5 (Litigation).
16.7 Insolvency and Rescheduling Any Obligor (notwithstanding whether or not
its insolvent or bankrupt status is declared in a decree judgement of a
competent court) is unable to pay its debts as they fall due, commences
negotiations (other than with the prior written consent of the Facility
Agent) with any one or more of its creditors with a view to the general
readjustment or rescheduling of its indebtedness or makes a general
assignment for the benefit of or a composition with its creditors, or
seeks any of the protections provided for in the Bankruptcy Act, or
becomes subject to any of the procedures provided for in the Bankruptcy
Act, and in the case of any such proceeding instituted against it (but
not instituted by it), either such proceeding shall remain undismissed
or unstayed for a period of forty five (45) days, or any of the actions
sought in such proceeding (including the entry of an order for relief
against it or the appointment of a receiver, trustee, custodian or
other similar official for it or for any part of its assets) shall
occur or any of the foregoing occurs in respect of any Obligor.
Provided that a mere claimant against an Obligor shall not be regarded
as a creditor until such claim is recognised by such Obligor pursuant
to applicable laws or otherwise.
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16.8 Winding-up Any Obligor takes any formal corporate action or other
formal steps are taken or legal proceedings are started for its
winding-up, dissolution or re-organisation or for the appointment of a
liquidator or similar officer of it or of any or all of its revenues
and assets.
16.9 Execution or Distress Any execution or distress is levied against, or
an encumbrancer takes possession of, the whole or any part of, the
property, undertaking or assets of any Obligor which when aggregated
with all other execution and distress exceeds an amount equivalent to
one hundred and fifty million Forints (HUF 150,000,000) which such
Obligor fails to demonstrate within a reasonable period of time (as
determined by the Facility Agent, acting reasonably) to the
satisfaction of the Facility Agent, acting reasonably, are frivolous or
vexatious and/or will be paid out and/or duly discharged within thirty
(30) business days, or such later date as the Facility Agent may agree.
16.10 Analogous Events Any event occurs in respect of an Obligor which under
the laws of any jurisdiction has a similar or analogous effect to any
of those events mentioned in Clause 16.7 (Insolvency and Rescheduling),
Clause 16.8 (Winding-up) or Clause 16.9 (Execution or Distress).
16.11 Governmental Intervention By or under the authority of any government:
(a) the management of any Obligor is wholly or partially displaced or
the authority of any Obligor in the conduct of its business is wholly
or partially curtailed; or (b) all or a majority of the issued shares
of any Obligor or the whole or any part of its respective revenues or
assets is seized, nationalised, expropriated or compulsorily acquired.
16.12 Ownership of Hungarian Telephone and Cable Corp. Other than as
expressly approved in advance in writing by the Facility Agent, acting
reasonably, or as expressly permitted in the Sponsors' Support
Agreement, Citizens Utilities Company, Tele Danmark and the IO Fund
sell, transfer or otherwise dispose of any of their issued share
capital of Hungarian Telephone and Cable Corp. following the
transactions contemplated in the Master Closing Agreement.
16.13 The Group's Business The Group ceases to carry on in any material
respect the business it carries on at the date of this Agreement or
enters into any unrelated business which might in the opinion of the
Facility Agent, acting reasonably, have a material adverse effect on
the financial condition of or on the ability of an Obligor to comply
with and/or perform its obligations and liabilities under any of the
Finance Documents to which it is a party and such circumstances, if
capable of remedy are not remedied within fourteen (14) days.
16.14 Repudiation Any Obligor repudiates any Finance Document to which it is
a party or does or causes to be done any act or thing evidencing an
intention to repudiate any Finance Document to which it is a party.
16.15 Validity and Admissibility At any time any act, condition or thing
required to be done, fulfilled or performed in order: (a) to enable an
Obligor lawfully to enter into, exercise its rights under and perform
the obligations expressed to be assumed by it under any of the Finance
Documents to which it is a party; or (b) to ensure that the obligations
expressed to be assumed by an Obligor under any of the Finance
Documents to which it is a party are legal, valid, in full force and
effect, binding on and enforceable against it; or (c) to make the
Finance Documents admissible in evidence in Hungary is not done,
fulfilled or performed and, if such failure to do, fulfil or perform is
capable of being remedied, the same is not so remedied within thirty
(30) days of the date of any written notice given by the Facility Agent
to the Borrowers in respect of such failure or, if in order to effect
such remedy, an application must be made to an organ, agency or other
administrative or regulatory body of Hungary, then such period shall be
extended to thirty (30) days.
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16.16 Illegality At any time it is or becomes unlawful and/or in conflict
with any applicable law, regulation or official or judicial order for
an Obligor to perform or comply with any or all of its respective
obligations, which in the opinion of the Facility Agent, acting
reasonably, are material, under applicable law or under any of the
Finance Documents to which it is a party or any of the obligations of
an Obligor under any of the Finance Documents to which it/they is/are a
party are not or cease to be legal, valid, binding and enforceable.
16.17 Performance of Obligations Any fact(s), event(s) or other
circumstance(s) arise(s) which in the opinion of the Facility Agent
acting on the instructions of an Instructing Group, acting reasonably,
has a material adverse effect on:
(a) the ability of any Obligor to duly perform and comply with all
its obligations under any Finance Document to which it is a
party as and when such obligations fall due; and/or
(b) the business, assets or financial condition of any Obligor or
the Group taken as a whole; and/or
(c) the ability of any Finance Party to exercise or enforce any
rights under any Finance Document.
16.18 Failure to Mitigate Interest Rate and Forex Risks A Borrower, at any
time, fails to duly and properly comply with the terms of Clause 15.19
(Mitigation of Interest Rate and Forex Risks) and/or in the reasonable
opinion of the Facility Agent, the strategy (if any) adopted by the
Borrowers in respect thereto is inappropriate and/or inadequate and
would reasonably be expected to cause any Borrower to be unable to meet
all its obligations arising under any of the Finance Documents to which
it is a party and such circumstances, if capable of remedy are not
remedied within fourteen (14) days.
16.19 Failure to Comply with Final Judgment Any Obligor fails to comply with
or pay any sum due from it under any final judgment or any final order
made or given by any court of competent jurisdiction.
16.20 Acceleration and Cancellation Upon the occurrence of an Event of
Default at any time thereafter where such Event of Default is not
remedied within the relevant cure period provided for in the relevant
Clause or waived, the Facility Agent may (and, if so instructed by an
Instructing Group, shall) by written notice to the Borrowers:
(a) declare the Advance(s) to be immediately due and payable
(whereupon the same shall become so payable together with
accrued interest thereon and any other sums then owed by the
Borrowers under this Agreement) or declare the Advance(s) to
be due and payable on demand of the Facility Agent; and/or
(b) declare that any undrawn portion of the Facility shall be
cancelled, whereupon the same shall be cancelled and the
Available Commitment of each Bank shall be reduced to zero
(0).
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16.21 Advance Due on Demand If, pursuant to Clause 16.20 (Acceleration and
Cancellation), the Facility Agent declares the Advance(s) to be due and
payable on demand of the Facility Agent, then, and at any time
thereafter, the Facility Agent may (and, if so instructed by an
Instructing Group, shall) by written notice to the Borrowers:
(a) require repayment of the Advance(s) on such date as it may
specify in such notice (whereupon the same shall become due
and payable on such date together with accrued interest
thereon and any other sums then owed by the Borrowers under
this Agreement) or withdraw its declaration with effect from
such date as it may specify in such notice; and/or
(b) select as the duration of any Interest Period which begins
whilst such declaration remains in effect a period of three
(3) months or less; and/or
(c) without prejudice to the provisions of any other Finance
Documents, declare that the Security Agreements (or any of
them) shall have become enforceable and enforce any or all of
the same.
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PART 7 - DEFAULT INTEREST AND INDEMNITY
17. Default Interest and Indemnity
17.1 Default Interest Periods If any sum due and payable by a Borrower under
this Agreement is not paid on the due date therefor in accordance with
the provisions of Clause 19 (Payments) or if any sum due and payable by
a Borrower under any judgement of any court in connection with this
Agreement is not paid on the date of such judgement, the period
beginning on such due date or, as the case may be, the date of such
judgement and ending on the date upon which the obligation of such
Borrower to pay such sum (the balance thereof for the time being unpaid
being in this Agreement referred to as an "unpaid sum") is discharged
shall be divided into successive periods, each of which (other than the
first) shall start on the last day of the preceding such period and the
duration of each of which shall (except as otherwise provided in this
Clause 17(Default Interest and Indemnity)) be selected by the Facility
Agent.
17.2 Default Interest During each such period relating thereto as is
mentioned in Clause 17.1 (Default Interest Periods) an unpaid sum shall
bear interest at the rate per annum which is the sum from time to time
of two point five per cent. (2.5%), the Margin and BUBOR or LIBOR, as
applicable, on the Quotation Date therefor Provided that:
(a) if, for any such period, BUBOR or LIBOR, as applicable,
cannot be determined, the rate of interest applicable to
such unpaid sum shall be the rate per annum which is the sum
of two point five per cent. (2.5%) the Margin and the
rate per annum determined by the Facility Agent to be
equal to the arithmetic mean (rounded upwards, if not
already such a multiple, to the nearest whole multiple
of one-sixteenth of one per cent. (0.0625%)) of the rates
notified by each Bank to the Facility Agent before the last
day of such period to be those which express as a percentage
rate per annum the cost to it of funding from whatever
sources it may select its portion of such unpaid sum for such
period; and
(b) if such unpaid sum is all or part of an Advance which became
due and payable on a day other than the last day of an
Interest Period relating thereto, the first such period
applicable thereto shall be of a duration equal to the
unexpired portion of that Interest Period and the rate of
interest applicable thereto from time to time during such
period shall be that which exceeds by two point five per cent.
(2.5%) the rate which would have been applicable to it had it
not so fallen due.
17.3 Payment of Default Interest Any interest which shall have accrued under
Clause 17.2 (Default Interest) in respect of an unpaid sum shall be due
and payable and shall be paid by the Borrowers at the end of the period
by reference to which it is calculated or on such other dates as the
Facility Agent may specify by written notice to the Borrowers Provided
that for the purposes of clarity, the parties to this Agreement confirm
that the rate of interest accruing and payable on any such unpaid sum
as default interest shall be the sum of from time to time of two point
five per cent. (2.5%), the Margin and BUBOR or LIBOR, as applicable, as
provided for in Clause 17.2 (Default Interest) and such unpaid sum will
not attract any further additional rate(s) of interest.
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17.4 Broken Periods If any Bank or the Facility Agent on its behalf receives
or recovers all or any part of such Bank's share of an Advance
otherwise than on the last day of an Interest Period relating to that
Advance, the Borrowers shall pay to the Facility Agent on demand for
account of such Bank an amount equal to the amount (if any) by which
the additional interest which would have been payable on the amount so
received or recovered had it been received or recovered on the last day
of that Interest Period exceeds the amount of interest which in the
opinion of the Facility Agent would have been payable to the Facility
Agent on the last day of that Interest Period in respect of a deposit
in the applicable currency equal to the amount so received or recovered
placed by it with a prime bank in London or Budapest, as applicable,
for a period starting on the third business day following the date of
such receipt or recovery and ending on the last day of that Interest
Period.
17.5 Borrowers' Indemnity Each Borrower undertakes to indemnify:
(a) each Finance Party against any cost, claim, loss, expense
(including legal fees) or liability together with any VAT
thereon, which any of them may reasonably and properly sustain
or reasonably and properly incur as a consequence of the
occurrence of any Event of Default or any default by any
Borrower in the performance of any of the obligations
expressed to be assumed by it in this Agreement up to an
aggregate amount equivalent to twelve million five hundred
thousand dollars (U.S.$. 12,500,000); and
(b) each Bank against any loss it may suffer or incur as a result
of its funding or making arrangements to fund its portion of
an Advance requested by the Borrower under a Notice of
Drawdown but not made by reason of the operation of any one or
more of the provisions of this Agreement.
17.6 Unpaid Sums as Advances Any unpaid sum shall for the purposes of this
Clause 17 (Default Interest and Indemnity) and, Clause 11.1 (Increased
Costs) be treated as an advance and accordingly in this Clause 17
(Default Interest and Indemnity) and Clause 11.1 (Increased Costs) the
term "Advance" includes any unpaid sum and the term "Interest Period",
in relation to an unpaid sum, includes each such period relating
thereto as is mentioned in Clause 17.1 (Default Interest Periods).
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PART 8 - PAYMENTS
18. Currency of Account and Payment
18.1 Currency of Account The HUF is the currency of account and payment for
each and every sum at any time due from the Borrower under this
Agreement Provided that:
(a) each repayment of an Advance or a part thereof shall be
made in the currency in which the same were incurred;
(b) each payment of interest shall be made in the currency in
which the sum in respect of which such interest is payable is
incurred;
(c) each payment in respect of costs and expenses shall be made in
the currency in which the same were incurred;
(d) each payment pursuant to Clause 9.2 (Tax Indemnity) or Clause
11.1 (Increased Costs) shall be made in the currency specified
by the party claiming under such clause(s); and
(e) other than as provided for above, any amount expressed to be
payable in a currency other than HUF shall be paid in that
other currency.
18.2 Currency Indemnity If any sum due from a Borrower under this Agreement
or any order or judgement given or made in relation to this Agreement
has to be converted from the currency (the "first currency") in which
the same is payable under this Agreement or under such order or
judgement into another currency (the "second currency") for the purpose
of: (a) making or filing a claim or proof against a Borrower; (b)
obtaining an order or judgement in any court or other tribunal; or (c)
enforcing any order or judgement given or made in relation to this
Agreement, each Borrower shall indemnify and hold harmless each of the
persons to whom such sum is due from and against any loss suffered or
incurred as a result of any discrepancy between: (i) the rate of
exchange used for such purpose to convert the sum in question from the
first currency into the second currency; and (ii) the rate or rates of
exchange at which such person may in the ordinary course of business
purchase the first currency with the second currency upon receipt of a
sum paid to it in satisfaction, in whole or in part, of any such order,
judgement, claim or proof.
19. Payments
19.1 Payments to the Facility Agent On each date on which this Agreement
requires:
(a) an amount denominated in the Optional Currency to be paid by:
(i) any of the Banks under this Agreement, such Bank
shall make the same available to the Facility Agent,
by payment in the Optional Currency and in same day
funds to such account or bank as the Facility Agent
may have specified for this purpose; or
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(ii) a Borrower, where such amount is denominated in
the Optional Currency, such Borrower shall: (i)
three (3) business days prior to such date hold in,
or transfer to, the relevant account, the HUF
equivalent of the amount to be so paid, together
with any bank charges payable to the Facility
Agent who shall convert such HUF into the optional
currency (at the best rate (or rates) of exchange
which the Facility Agent is offering to customers
for such amounts at such time) and hold such Optional
Currency amount in the relevant account of the
Borrower before promptly forwarding such funds on to
the Facility Agent's bank account, with in the
case of Hungarotel Tavkozlesi Koncesszios
Reszvenytarsasag, the Facility Agent's account number
11991102-02177508-00070003, in the case of RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag, the
Facility Agent's account number 00000000-00000000-
00070003, in the case of Papa es Tersege
Tavkozlesi Koncesszios Reszvenytarsasag, the
Facility Agent's account number 00000000-00000000-
00070003, in the case of KNC Kelet-Nograd COM
Tavkozlesi Koncesszios Reszvenytarsasag, the
Facility Agent's account number 00000000-00000000-
00070003 (or such other account or bank as the
Facility Agent may have specified for this
purpose); or (ii) where permitted under the Foreign
Exchange Act, pay the required amount of the Optional
Currency into the above bank account for value on
such date,
Provided that each Borrower expressly acknowledges and accepts
that notwithstanding the respective roles, responsibilities
and duties of the Facility Agent under this Agreement, each
Borrower's obligations under this Agreement shall not be
discharged until the relevant amount of the Optional Currency
required to be paid under this Agreement at such time is
actually received in the Facility Agent's bank account, as
detailed above, (or such other account or bank as the Facility
Agent may have specified for this purpose) and otherwise than
by reason of its own material negligence or wilful misconduct,
the Facility Agent will not be liable to the Borrower for any
problems with such currency conversions and/or transfers; or
(b) an amount denominated in HUF to be paid by:
(i) any of the Banks under this Agreement, such Bank
shall make the same available to the Facility Agent
by payment in HUF and in same day funds (or in such
other funds as may for the time being be customary in
Budapest for the settlement in Budapest of banking
transactions in HUF) to the Facility Agent's account
number as the Facility Agent may have specified for
this purpose); or
(ii) a Borrower, under this Agreement, such Borrower
shall make the same available to the Facility
Agent by payment in HUF and in same day funds (or in
such other funds as may for the time being be
customary in Budapest for the settlement in Budapest
of banking transactions in HUF) to in the case of
Hungarotel Tavkozlesi Koncesszios Reszvenytarsasag,
the Facility Agent's account number 00000000-
02177508-00070010, in the case of RABA-COM
Tavkozlesi Koncesszios Reszvenytarsasag, the
Facility Agent's account number 00000000-00000000-
00070010, in the case of Papa es Tersege
Tavkozlesi Koncesszios Reszvenytarsasag, the
Facility Agent's account number 00000000-00000000-
00070010, in the case of KNC Kelet-Nograd COM
Tavkozlesi Koncesszios Reszvenytarsasag, the
Facility Agent's account number 00000000-00000000-
00070010 (or such other account or bank as the
Facility Agent may have specified for this purpose).
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19.2 Alternative Payment Arrangements If, at any time, it shall become
impracticable (by reason of any action of any governmental authority or
any change in law, exchange control regulations or any similar event)
for the Borrowers to make any payments under this Agreement in the
manner specified in Clause 19.1 (Payments to the Facility Agent), then
the Borrowers may agree with each or any of the Banks alternative
arrangements for the payment direct to such Bank of amounts due to such
Bank under this Agreement Provided that, in the absence of any such
agreement with any Bank, the Borrowers shall be obliged to make all
payments due to such Bank in the manner specified in this Agreement.
Upon reaching such agreement the Borrowers and such Bank shall
immediately notify the Facility Agent of such agreement and shall
thereafter promptly notify the Facility Agent of all payments made
direct to such Bank.
19.3 Payments by the Facility Agent Save as otherwise provided in this
Agreement, each payment received by the Facility Agent for the account
of another person pursuant to Clause 19.1 (Payments to the Facility
Agent) shall be made available by the Facility Agent to such other
person (in the case of a Bank, for the account of its Facility Office)
for value the same day by transfer to such account of such person with
such bank as such person shall have previously notified to the Facility
Agent.
19.4 No Set-off All payments required to be made by any Borrower under this
Agreement shall be calculated without reference to any set-off or
counterclaim and shall be made free and clear of and without any
deduction for or on account of any set-off or counterclaim.
19.5 Clawback Where a sum is to be paid under this Agreement to the Facility
Agent for account of another person, the Facility Agent shall not be
obliged to make the same available to that other person until it has
been able to establish to its satisfaction that it has actually
received such sum, but if it does so and it proves to be the case that
it had not actually received such sum, then the person to whom such sum
was so made available shall on request refund the same to the Facility
Agent together with an amount sufficient to indemnify the Facility
Agent against any cost or loss it may have suffered or incurred by
reason of its having paid out such sum.
20. Set-Off
20.1 Contractual Set-off At any time after the occurrence of an Event of
Default and without prejudice to the other rights or the Banks under
applicable law or the terms and conditions governing any account which
would permit the exercise of any such rights at any other time, each
Borrower authorises each Bank to apply any credit balance to which such
Borrower is entitled on any account of such Borrower with that Bank in
satisfaction of any sum due and payable from any Borrower to such Bank
under this Agreement but unpaid; for this purpose, each Bank is
authorised to purchase with the moneys standing to the credit of any
such account such other currencies as may be necessary to effect such
application.
20.2 Set-off not Mandatory No Bank shall be obliged to exercise any right
given to it by Clause 20.1 (Contractual Set-off).
21. Sharing
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21.1 Redistribution of Payments Subject to Clause 21.3 (Recoveries Through
Legal Proceedings), if at any time, the proportion which any Bank (a
"Recovering Bank") has received or recovered (whether by payment, the
exercise of a right of set-off or combination of accounts or otherwise)
in respect of its portion of any payment (a "relevant payment") to be
made under this Agreement by any Borrower for account of such
Recovering Bank and one or more other Banks is greater (the portion of
such receipt or recovery giving rise to such excess proportion being in
this Agreement called an "excess amount") than the proportion thereof
so received or recovered by the Bank or Banks so receiving or
recovering the smallest proportion thereof, then:
(a) such Recovering Bank shall inform the Facility Agent of such
receipt or recovery and pay to the Facility Agent an amount
equal to such excess amount;
(b) there shall thereupon fall due from each Borrower to such
Recovering Bank an amount equal to the amount paid out by such
Recovering Bank pursuant to paragraph (a) above, the amount so
due being, for the purposes of this Agreement, treated as if
it were an unpaid part of such Recovering Bank's portion of
such relevant payment; and
(c) the Facility Agent shall treat the amount received by it from
such Recovering Bank pursuant to paragraph (a) above as if
such amount had been received by it from a Borrower in respect
of such relevant payment and shall pay the same to the persons
entitled thereto (including such Recovering Bank) pro rata to
their respective entitlements thereto.
21.2 Repayable Recoveries If any sum (a "relevant sum") received or
recovered by a Recovering Bank in respect of any amount owing to it by
any Borrower becomes repayable and is repaid by such Recovering Bank,
then:
(a) each Bank which has received a share of such relevant sum by
reason of the implementation of Clause 21.1 (Redistribution of
Payments) shall, upon request of the Facility Agent, pay to
the Facility Agent for account of such Recovering Bank an
amount equal to its share of such relevant sum together with
such amount (if any) as is necessary to reimburse the
Recovering Bank the appropriate proportion of any interest it
shall have been obliged to pay when repaying such relevant sum
to such Borrower as aforesaid; and
(b) there shall thereupon fall due from the Borrowers to each such
Bank an amount equal to the amount paid out by it pursuant to
paragraph (a) above, the amount so due being, for the purposes
of this Agreement, treated as if it were the sum payable to
such Bank against which such Bank's share of such relevant sum
was applied.
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21.3 Recoveries Through Legal Proceedings If any Bank shall commence any
action or proceeding in any court to enforce its rights under this
Agreement after consultation with the other Banks and, as a result of
such action or proceedings or in connection with such action or
proceedings, shall receive any excess amount (as defined in Clause 21.1
(Redistribution of Payments)), then such Bank shall not be required to
share any portion of such excess amount with any Bank which has the
legal right to, but does not, join in such action or proceeding or
commence and diligently prosecute a separate action or proceeding to
enforce its rights in another court.
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PART 9 - FEES, COSTS AND EXPENSES
22. Arrangement Fees
Each Borrower shall pay to the Arranger the upfront fee specified in
the Fee Letter.
23. Costs and Expenses
23.1 Transaction Expenses The Borrowers shall, on the basis of joint and
several liability, from time to time on demand of the Facility Agent,
reimburse the Facility Agent for all legal costs, legal fees and legal
expenses together with any VAT, if any, thereon, reasonably and
properly incurred by it in connection with the negotiation,
documentation and preparation, signing of the Finance Documents on the
basis set out in the Fee Letter.
23.2 Preservation and Enforcement of Rights The Borrowers shall, on the
basis of joint and several liability, from time to time on demand of a
Finance Party, reimburse such Finance Party for all costs and expenses
(including, inter alia, legal fees and the fees of any financial
adviser retained to advise the Banks, if any) together with any VAT
thereon properly incurred in or in connection with the preservation
and/or enforcement of any of the rights of the Finance Parties under
any of the Finance Documents up to an aggregate amount equivalent to
twelve million five hundred thousand dollars (U.S.$. 12,500,000).
23.3 Stamp Taxes The Borrowers shall, on the basis of joint and several
liability, pay all stamp, registration and other taxes to which the
Finance Documents or any judgement given in connection with the Finance
Documents is or at any time may be subject and shall, from time to time
on demand of a Finance Party, indemnify such Finance Party against any
liabilities, costs, claims and expenses resulting from any failure to
pay or any delay in paying any such tax.
23.4 Facility Agent's and Security Agent's Costs Each Borrower shall, on the
basis of joint and several liability, from time to time on demand of
the Facility Agent and/or the Security Agent (and without prejudice to
the provisions of Clause 23.2 (Preservation and Enforcement of Rights)
and Clause 29.2 (Amendment Costs) compensate the Facility Agent and/or
the Security Agent, as applicable, at such daily and/or hourly rates as
the Facility Agent and/or the Security Agent, as applicable, shall in
the context of market rates in Hungary from time to time reasonably
determine for the time and expenditure, all costs and expenses
(including telephone, fax, copying, travel and personnel costs)
incurred by the Facility Agent and/or the Security Agent, as
applicable, in connection with its taking such action as it may deem
appropriate or in complying with any instructions from an Instructing
Group or any request by a Borrower in connection with:
(a) the granting or proposed granting of any waiver or consent
requested under this Agreement by a Borrower;
(b) (i) in the case of an instruction from an Instructing Group
any breach by a Borrower of its obligations under this
Agreement; and (ii) in the case of any request from a
Borrower, any actual, potential or suspected breach by the
Borrower of its obligations under this Agreement;
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(c) the occurrence of any event which is an Event of Default or
a Potential Event of Default; or
(d) any amendment or proposed amendment to this Agreement
requested by Borrower.
23.5 Banks' Liabilities for Costs If the Borrowers fail to perform any of
their respective obligations under this Clause 23 (Costs and Expenses),
each Bank shall, in the proportion borne by its share of the Loan (or,
if no Advance has been made, its Available Commitment) to the amount of
the Loan (or, if no Advance have been made, the Available Facility) for
the time being (or, if the Loan has been repaid in full, immediately
prior to the final repayment thereof), indemnify each of the Arranger,
the Facility Agent and the Security Agent against any loss incurred by
any of them as a result of such failure and each Borrower shall, on the
basis of joint and several liability, forthwith reimburse each Bank for
any payment made by it pursuant to this Clause 23.5.
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PART 10 - AGENCY PROVISIONS
24. The Facility Agent, the Security Agent, the Arranger and the Banks
24.1 Appointment of the Facility Agent and the Security Agent The Arranger
and each Bank hereby appoints:
(a) the Facility Agent to act as its agent in connection with
this Agreement and authorises the Facility Agent to exercise
such rights, powers, authorities and discretions as are
specifically delegated to the Facility Agent by the terms of
this Agreement together with all such rights, powers,
authorities and discretions as are reasonably incidental
thereto as well as acting to ensure that, so far as
reasonably possible, all communications between the
Borrowers and the Banks are made through the Facility Agent
(so that all communications from the Borrowers to the
Arranger, the Security Agent or to any Bank (being a member
of an Instructing Group or otherwise) will only be made
through the Facility Agent and all communications from
the Arranger, the Security Agent, an Instructing Group or any
Bank (being a member of an Instructing Group or otherwise)
to the Borrowers will also only be made through the Facility
Agent) Provided that an Instructing Group may in exceptional
circumstances be entitled to communicate directly with the
Borrowers; and
(b) the Security Agent to:
(i) act in connection with certain encumbrances created by
and constituted in the Security Agreements, given by
the Obligors in respect of this Agreement and
authorises the Security Agent to exercise such rights,
powers, authorities and discretions as are
specifically delegated to the Security Agent by the
terms of this Agreement and those contained in such
documents together with all such rights, powers,
authorities and discretions as are reasonably
incidental thereto; and
(ii) upon the enforcement of any of the rights constituted
in such Security Agreements, act in respect of the
holding of the Optional Currency and HUF of the
Borrowers, the conversion of such HUF into the
Optional Currency or the Optional Currency into HUF
and upon the conversion of HUF into the Optional
Currency the subsequent transfer of such Optional
Currency to the bank account specified by the Facility
Agent.
24.2 Facility Agent's and the Security Agent's Discretions Each of the
Facility Agent and the Security Agent may:
(a) assume, unless it has, in its capacity as agent for the Banks,
received notice to the contrary from any other party to this
Agreement, that: (i) any representation made by a Borrower in
connection with this Agreement is true; (ii) no Event of
Default or Potential Event of Default has occurred; (iii) no
Borrower is in breach of or default under its obligations
under this Agreement; and (iv) any right, power, authority or
discretion vested in this Agreement upon an Instructing Group,
the Banks or any other person or group of persons has not been
exercised;
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(b) assume that the Facility Office of each Bank is that
identified with its signature below (or, in the case of a
Transferee, at the end of the Transfer Certificate to which it
is a party as Transferee) until it has received from such Bank
a notice designating some other office of such Bank to replace
its Facility Office and act upon any such notice until the
same is superseded by a further such notice;
(c) engage and pay for the advice or services of any lawyers,
accountants, surveyors or other experts whose advice or
services may to it seem necessary, expedient or desirable and
rely upon any advice so obtained;
(d) rely as to any matters of fact which might reasonably be
expected to be within the knowledge of a Borrower upon a
certificate signed by or on behalf of such Borrower;
(e) rely upon any communication or document believed by it to be
genuine;
(f) refrain from exercising any right, power or discretion vested
in it as agent under this Agreement unless and until
instructed by an Instructing Group as to whether or not such
right, power or discretion is to be exercised and, if it is to
be exercised, as to the manner in which it should be
exercised; and
(g) refrain from acting in accordance with any instructions of an
Instructing Group to begin any legal action or proceeding
arising out of or in connection with this Agreement until it
shall have received such security as it may require (whether
by way of payment in advance or otherwise) for all costs,
claims, losses, expenses (including legal fees) and
liabilities together with any VAT thereon which it will or may
expend or incur in complying with such instructions.
24.3 Facility Agent's and the Security Agent's Obligations Each of the
Facility Agent and the Security Agent shall:
(a) promptly inform each Bank of the contents of any notice or
document received by it in its capacity as Facility Agent or
Security Agent (as appropriate) from a Borrower under this
Agreement;
(b) promptly notify each Bank of the occurrence of any Event of
Default or any default by a Borrower in the due performance of
or compliance with its obligations under this Agreement of
which the Facility Agent or Security Agent (as appropriate)
has notice from any other party to this Agreement;
(c) save as otherwise provided in this Agreement, act as agent
under this Agreement in accordance with any instructions given
to it by an Instructing Group, which instructions shall be
binding on the Arranger and the Banks;
(d) if so instructed by an Instructing Group, refrain from
exercising any right, power or discretion vested in it as
agent under this Agreement; and
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(e) in respect of any amount of the Loan repaid or prepaid, or
arising as a result of the enforcement of any rights or
benefits arising under this Agreement or under the Security
Agreements, and subject to the terms therein, distribute such
amount(s) between the Banks in accordance with each Bank's
participation in the Loan at such time.
24.4 Excluded Obligations Notwithstanding anything to the contrary expressed
or implied in this Agreement, none of the Arranger, the Facility Agent
or the Security Agent shall:
(a) be bound to enquire as to: (i) whether or not any
representation made by any Borrower in connection with this
Agreement is true; (ii) the occurrence or otherwise of any
Event of Default or Potential Event of Default; (iii) the
performance by any Borrower of its obligations under this
Agreement; or (iv) any breach of or default by the Borrower of
or under its obligations under this Agreement;
(b) be bound to account to any Bank for any sum or the profit
element of any sum received by it for its own account;
(c) be bound to disclose to any other person any information
relating to a Borrower if such disclosure would or might in
its opinion constitute a breach of any law or regulation or be
otherwise actionable at the suit of any person; or
(d) be under any obligations other than those for which express
provision is made in this Agreement.
24.5 Indemnification Each Bank shall, from time to time on demand by the
Facility Agent and/or the Security Agent indemnify the Facility Agent
and/or the Security Agent in the proportion its share the Loan (or, if
no Advance has been made, its Available Commitment) bears to the amount
of the Loan (or, if no Advance has been made, the Available Facility)
at the time of such demand (or, if the Loan has then been repaid in
full, immediately prior to the final repayment thereof), against any
and all costs, claims, losses, expenses (including legal fees) and
liabilities together with any VAT thereon which the Facility Agent
and/or the Security Agent may incur, otherwise than by reason of its
own gross negligence or wilful misconduct, in acting in its capacity as
agent under this Agreement.
24.6 Exclusion of Liabilities None of the Arranger, the Facility Agent or
the Security Agent nor any of them accepts any responsibility for the
accuracy and/or completeness of any information supplied by the
Borrowers in connection with this Agreement or for the legality,
validity, effectiveness, adequacy or enforceability of any of the
Finance Documents and none of the Arranger, the Facility Agent or the
Security Agent nor any of them shall be under any liability to the
Banks as a result of taking or omitting to take any action in relation
to this Agreement, save in the case of gross negligence or wilful
misconduct.
24.7 No Actions Each of the Banks agrees that it will not assert or seek to
assert against any director, officer or employee of the Arranger, the
Facility Agent or the Security Agent any claim it might have against
any of them in respect of the matters referred to in Clause 24.6
(Exclusion of Liabilities).
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24.8 Business with the Borrower The Arranger, the Facility Agent and the
Security Agent may accept deposits from, lend money to and generally
engage in any kind of banking or other business with any Borrower or
with any of its affiliates.
24.9 Resignation of the Facility Agent The Facility Agent may resign its
appointment under this Agreement at any time without assigning any
reason therefor by giving not less than thirty (30) days' prior written
notice to that effect to each of the other parties to this Agreement
Provided that no such resignation shall be effective until a successor
for the Facility Agent is appointed in accordance with the succeeding
provisions of this Clause 24 (The Facility Agent, the Security Agent,
the Arranger and the Banks).
24.10 Successor Facility Agent If the Facility Agent gives notice of its
resignation pursuant to Clause 24.9 (Resignation of the Facility
Agent), then subject to the prior written consent of Borrowers (such
consent not to be unreasonably withheld or delayed), any reputable and
experienced bank or other financial institution may be appointed as a
successor to the Facility Agent by an Instructing Group during the
period of such notice but, if no such successor is so appointed, the
Facility Agent may appoint such a successor itself.
24.11 Rights and Obligations of the Facility Agent If a successor to the
Facility Agent is appointed under the provisions of Clause 24.10
(Successor Facility Agent), then: (a) the retiring Facility Agent shall
be discharged from any further obligation under this Agreement but
shall remain entitled to the benefit of the provisions of this Clause
24 (The Facility Agent, the Security Agent, the Arranger and the
Banks), and (b) its successor and each of the other parties to this
Agreement shall have the same rights and obligations amongst themselves
as they would have had if such successor had been a party to this
Agreement.
24.12 Resignation of the Security Agent The Security Agent may resign its
appointment under this Agreement at any time without assigning any
reason therefor by giving not less than thirty (30) days' prior written
notice to that effect to each of the other parties to this Agreement
Provided that no such resignation shall be effective until a successor
for the Security Agent is appointed in accordance with the succeeding
provisions of this Clause 24 (The Facility Agent, the Security Agent,
the Arranger and the Banks).
24.13 Successor Security Agent If the Security Agent gives notice of its
resignation pursuant to Clause 24.12 (Resignation of the Security
Agent), then subject to the prior written consent of Borrowers (such
consent not to be unreasonably withheld or delayed), any reputable and
experienced bank or other financial institution may be appointed as a
successor to the Security Agent by an Instructing Group during the
period of such notice but, if no such successor is so appointed, the
Security Agent may appoint such a successor itself.
24.14 Rights and Obligations of the Security Agent If a successor to the
Security Agent is appointed under the provisions of Clause 24.13
(Successor Security Agent), then: (a) the retiring Security Agent shall
be discharged from any further obligation under this Agreement but
shall remain entitled to the benefit of the provisions of this Clause
24 (The Facility Agent, the Security Agent, the Arranger and the
Banks), and (b) its successor and each of the other parties to this
Agreement shall have the same rights and obligations amongst themselves
as they would have had if such successor had been a party to this
Agreement.
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24.15 Own Responsibility It is understood and agreed by each Bank that it has
itself been, and will continue to be, solely responsible for making its
own independent appraisal of and investigations into the financial
condition, creditworthiness, condition, affairs, status and nature of
each of the Borrowers and, accordingly, each Bank represents and
warrants to each of the Arranger, the Facility Agent and the Security
Agent that it has not relied on and will not hereafter rely on the
Arranger, the Facility Agent or the Security Agent nor any of them:
(a) to check or enquire on its behalf into the adequacy, accuracy
or completeness of any information provided by the Borrowers
in connection with this Agreement or the transactions
contemplated by this Agreement (whether or not such
information has been or is hereafter circulated to such Bank
by the Arranger, the Facility Agent, the Security Agent or any
of them); or
(b) to assess or keep under review on its behalf the financial
condition, creditworthiness, condition, affairs, status or
nature of the Borrowers.
24.16 Agency Division Separate In acting as agent under this Agreement for
the Banks, the Facility Agent and the Security Agent shall be regarded
as acting through their respective agency divisions which shall be
treated as separate entities from any other of their divisions or
departments and, notwithstanding the foregoing provisions of this
Clause 24 (The Facility Agent, the Security Agent, the Arranger and the
Banks), any information received by some other division or department
of the Facility Agent or the Security Agent may be treated as
confidential and shall not be regarded as having been given to the
Facility Agent's or the Security Agent's agency division.
24.17 Confidential Information Notwithstanding anything to the contrary
expressed or implied in this Agreement and without prejudice to the
provisions of Clause 24.16 (Agency Division Separate), the Facility
Agent and the Security Agent shall not as between each of themselves
and the Banks be bound to disclose to any Bank or other person any
information which is supplied by a Borrower to the Facility Agent or
the Security Agent in its capacity as agent under this Agreement for
the Banks and which is identified by such Borrower at the time it is so
supplied as being confidential information Provided that the consent of
any Borrower to such disclosure shall not be required in relation to
any information which in the opinion of the Facility Agent or the
Security Agent relates to an Event of Default or Potential Event of
Default or in respect of which the Banks have given a confidentiality
undertaking in a form satisfactory to the Facility Agent, the Security
Agent and the Borrowers.
24.18 Borrower's Reliance Nothing contained in this Agreement shall be
interpreted to impose, nor shall the Borrowers have, any obligation to
inquire into the authority of the Facility Agent or the Security Agent
in its performance of their respective duties under this Agreement or
any other Finance Documents to which they are a party and the Borrowers
shall be entitled to rely upon any notice, certificate, permission,
consent or other document received by such Borrower from the Facility
Agent or the Security Agent for any purpose under this Agreement.
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24.19 Security Agreements Each Borrower and each Finance Party acknowledges
and unconditionally and irrevocably agrees that the Security Agent
shall be entitled to hold the encumbrances created by and constituted
in the Security Agreements for the benefit of each Finance Party and
that the Security Agent shall be freely entitled to consider the
allocation and to then allocate the proceeds arising from the
enforcement of such encumbrances or from any sale or other disposal of
the applicable assets, as provided for in the Finance Documents,
towards discharging any Borrower's obligations arising under this
Agreement and/or any other Finance Document as the Security Agent in
its sole discretion may see fit.
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PART 11 - ASSIGNMENTS AND TRANSFERS
25. Assignments and Transfers
25.1 Binding Agreement This Agreement shall be binding upon and enure to the
benefit of each party to this Agreement and its or any subsequent
successors, Transferees and assigns.
25.2 No Assignments and Transfers by the Borrowers No Borrower shall be
entitled to assign or transfer all or any of its rights, benefits and
obligations under this Agreement.
25.3 Assignments and Transfers by Banks Any Bank may, at any time, (i)
assign all or any of its rights and benefits under this Agreement to an
affiliate or to another office of such Bank which is at such time a
Qualifying Bank; or (ii) subject to the prior written consent, with
attached conditions, if any, of the Borrowers, such consent not to be
unreasonably withheld or delayed, transfer in accordance with Clause
25.5 (Transfers by Banks) to any other bank or financial institution
which at such time does not have a material direct equity and/or other
ownership interest in any person which is a direct competitor of the
Group's business and operations in Hungary all or any of its rights,
benefits and obligations under this Agreement.
25.4 Assignments by Banks If any Bank assigns all or any of its rights and
benefits under this Agreement in accordance with Clause 25.3
(Assignments and Transfers by Banks), then, unless and until the
assignee has agreed with the Facility Agent, the Security Agent, the
Arranger and the other Banks that it shall be under the same
obligations towards each of them as it would have been under if it had
been an original party to this Agreement as a Bank (whereupon such
assignee shall become a party to this Agreement as a "Bank"), the
Facility Agent, the Security Agent, the Arranger and the other Banks
shall not be obliged to recognise such assignee as having the rights
against each of them which it would have had if it had been such a
party to this Agreement.
25.5 Transfers by Banks If any Bank wishes to transfer all or any of its
rights, benefits and/or obligations under this Agreement as
contemplated in Clause 25.3 (Assignments and Transfers by Banks), then
such transfer may be effected by the delivery to the Facility Agent of
a duly completed and duly executed Transfer Certificate in which event,
on the later of the Transfer Date specified in such Transfer
Certificate and the fifth business day after (or such earlier business
day endorsed by the Facility Agent on such Transfer Certificate falling
on or after) the date of delivery of such Transfer Certificate to the
Facility Agent:
(a) to the extent that in such Transfer Certificate the Bank party
thereto seeks to transfer its rights, benefits and obligations
under this Agreement, the Borrowers and such Bank shall be
released from further obligations towards one another under
this Agreement and their respective rights against one another
shall be cancelled (such rights and obligations being referred
to in this Clause 25.5 as "discharged rights and
obligations");
(b) the Borrowers and the Transferee party thereto 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 Borrowers and such Transferee
have assumed and/or acquired the same in place of the
Borrowers and such Bank;
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(c) the Facility Agent, the Security Agent, the Arranger, such
Transferee and the other Banks shall acquire the same rights
and benefits and assume the same obligations between
themselves as they would have acquired and assumed had such
Transferee been an original party to this Agreement as a Bank
with the rights, benefits and/or obligations acquired or
assumed by it as a result of such transfer; and
(d) such Transferee shall become a party to this Agreement as a "Bank".
25.6 Transfer Fees On the date upon which a transfer takes effect pursuant
to Clause 25.5 (Transfers by Banks) the Transferee in respect of such
transfer shall pay to the Facility Agent for its own account a transfer
fee of U.S.$ 750.
25.7 Disclosure of Information Any Finance Party (or a person acting on its
behalf) may disclose to any actual or potential assignee, transferee,
replacement or successor of such Finance Party, or to any of such
person's advisers, or with the prior written consent of the Borrowers
(such consent not to be unreasonably withheld or delayed), to any
person who may otherwise enter into contractual relations with such
Finance Party in relation to this Agreement, such information about the
Borrowers as such Finance Party shall consider appropriate Provided
that each such actual or potential assignee, transferee, replacement or
successor of such Finance Party or person or participant in this
Agreement first provides such Finance Party and/or person with a
confidentiality undertaking in favour of the Borrowers and such Finance
Party, Security Agent and/or person, requiring such actual or potential
assignee, transferee, replacement or successor of such Finance Party or
person or participant in this Agreement, or other person to maintain
the same level of confidentiality required from such Finance Party at
such time Provided Further that any person shall be freely entitled to,
at all times, and without being in breach of this Clause 25.7: (i)
comply with any order of a court of competent jurisdiction (whether in
pursuance of any procedure for discovering documents or otherwise);
(ii) act in accordance with the requirements of any competent
governmental, banking, or taxation authority; and (iii) freely disclose
any information that is, at such time, already in the public domain,
otherwise than by a breach by any person of the provisions of this
Clause 25.7 and, in case of a disclosure under (i) to (iii) (inclusive)
above, such person shall to the extent practicable at such time, give
prior notice to the Borrowers and shall, in any event, notify the
Borrowers of such disclosure (subject to compliance with any orders or
express requirements to the contrary).
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PART 12 - MISCELLANEOUS
26. Calculations and Evidence of Debt
26.1 Basis of Accrual Interest and commitment commission shall accrue from
day to day and shall be calculated on the basis of a year of 360 days
(or, in any case where market practice differs, in accordance with
market practice) and the actual number of days elapsed.
26.2 Quotations If on any occasion a Reference Bank or Bank fails to supply
the Facility Agent with a quotation required of it under the foregoing
provisions of this Agreement, the rate for which such quotation was
required shall be determined from those quotations which are supplied
to the Facility Agent.
26.3 Evidence of Debt Each Bank shall maintain in accordance with its usual
practice accounts evidencing the amounts from time to time lent by and
owing to it under this Agreement.
26.4 Control Accounts The Facility Agent shall maintain on its books a
control account or accounts in which shall be recorded: (a) the amount
of any Advance made or arising under this Agreement and each Bank's
share therein; (b) the amount of all principal, interest and other sums
due or to become due from each Borrower to any of the Banks under this
Agreement and each Bank's share therein; and (c) the amount of any sum
received or recovered by the Facility Agent under this Agreement and
each Bank's share therein.
26.5 Prima Facie Evidence In any legal action or proceeding arising out of
or in connection with this Agreement, the entries made in the accounts
maintained pursuant to Clause 26.3 (Evidence of Debt) and Clause 26.4
(Control Accounts) shall be prima facie evidence of the existence and
amounts of the specified obligations of each of the Borrowers.
26.6 Certificates of Banks A certificate of a Bank as to: (a) the amount by
which a sum payable to it under this Agreement is to be increased under
Clause 9.1 (Tax Gross-up); or (b) the amount for the time being
required to indemnify it against any such cost, payment or liability as
is mentioned in Clause 9.2 (Tax Indemnity) or Clause 11.1 (Increased
Costs), shall, in the absence of manifest error, be prima facie
evidence of the existence and amounts of the specified obligations of
the Borrowers and such certificate shall be provided to the Borrower
and shall set out in reasonable detail the basis of any such claim,
details of the calculations (and workings) of such claim and if
appropriate, supporting documentary evidence Provided that nothing in
this Agreement shall require any Bank to disclose any confidential
information whatsoever relating to the organisation of its affairs.
26.7 Claims A Bank intending to make a claim pursuant to this Agreement
shall, otherwise than as already expressly provided for in this
Agreement, notify and provide a certificate to the Facility Agent
setting out in reasonable detail the event by reason of which it is
entitled to do so, the basis of its claim, details of the calculations
(and workings) of such claim and, if appropriate, supporting
documentary evidence, whereupon the Facility Agent shall notify the
Borrowers thereof and provide a copy of such certificate Provided that
nothing in this Agreement shall require such Bank to disclose any
confidential information relating to the organisation of its affairs.
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27. Remedies and Waivers, Partial Invalidity
27.1 Remedies and Waivers No failure to exercise, nor any delay in
exercising, on the part of the Facility Agent, the Security Agent, the
Arranger and the Banks or any of them, any right or remedy under this
Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right or remedy prevent any further or other
exercise thereof or the exercise of any other right or remedy. The
rights and remedies in this Agreement provided are cumulative and not
exclusive of any rights or remedies provided by law.
27.2 Partial Invalidity If, at any time, any provision of this Agreement is
or becomes illegal, invalid or unenforceable in any respect under the
law of any jurisdiction, neither the legality, validity or
enforceability of the remaining provisions of this Agreement nor the
legality, validity or enforceability of such provision under the law of
any other jurisdiction shall in any way be affected or impaired
thereby.
28. Notices
28.1 Communications in Writing Each communication to be made under this
Agreement shall be made in writing and, unless otherwise stated, shall
be made by fax or letter.
28.2 Delivery Any communication or document to be made or delivered by one
person to another pursuant to this Agreement shall (unless that other
person has by fifteen (15) days' written notice to the Facility Agent
specified another address) be made or delivered to that other person at
the address identified with its signature below (or, in the case of a
Transferee, at the end of the Transfer Certificate to which it is a
party as Transferee) and shall be deemed to have been made or delivered
in the case of any communication made:
(a) by letter, when left at that address or (as the case may be)
ten (10) days after being deposited in the post postage
prepaid in an envelope addressed to it at that address;
(b) by facsimile, when dispatched Provided that: (a) a
confirmation of uninterrupted transmission by a
transmission report is received; and (b) there having been
no telephonic communication by the recipient to the sender
(any such telephonic communication to be confirmed in
writing) that the facsimile has not been received in legible
form within 3 hours after sending, if sent on a business day
between the hours of 9:00 a.m. and 4:00 p.m. in the
recipient's time zone or if sent other than between the hours
of 9:00 a.m. and 4:00 p.m. in the recipient's time zone
on a business day, by noon on the next following business day.
For the purposes of this sub-clause, a business day is a day
(other than a Saturday or Sunday) on which banks
(generally) are open for business in the places where both the
sender and the recipient of the facsimile are situated
Provided that any communication or document to be made or delivered to
the Facility Agent or to the Security Agent shall be effective only
when received by the Facility Agent or the Security Agent (as
appropriate) and then only if the same is expressly marked for the
attention of the department or officer identified with the Facility
Agent's or Security Agent's signature below (or such other department
or officer as the Facility Agent or the Security Agent shall from time
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to time specify for this purpose) Provided Further that in respect of
any communication or document to be made or delivered under this
Agreement to any Obligor by any Finance Party, such Finance Party will
take all reasonable and practicable efforts to procure and ensure that
such communication or document is delivered as indicated with such
Obligor's signature below.
28.3 Hungarian Language Each communication and document made or delivered by
one party to another pursuant to this Agreement shall be in the
Hungarian language Provided that any Finance Party receiving such
communication or document shall be entitled to require the prompt
translation of such communication or document into English, failing
which such Finance Party shall be entitled to procure such translation
into English at the Borrowers' cost and expense.
29. Amendments
29.1 Amendment Procedures The Facility Agent (together with the Security
Agent), if it (they) has (have) the prior written consent of an
Instructing Group, and each of the Borrowers may from time to time
agree in writing to amend this Agreement or to waive, prospectively or
retrospectively, any of the requirements of this Agreement and any
amendments or waivers so agreed shall be binding on all the Banks, the
Arranger and each of the Borrowers Provided that:
(a) no such waiver or amendment shall subject any party to this
Agreement to any new or additional obligations without the
consent of such party;
(b) without the prior written consent of all the Banks, no such
amendment or waiver shall:
(i) amend or waive any provision of Clause 21 (Sharing)
or this Clause 29 (Amendments);
(ii) reduce the proportion of any amount received or
recovered (whether by way of set-off, combination of
accounts or otherwise) in respect of any amount due
from a Borrower under this Agreement to which any
Bank is entitled;
(iii) change the principal amount of or currency of any
Advance, or defer the Final Maturity Date;
(iv) change the Margin, change the amount or currency or
defer the date for any payment of interest, fees or
any other amount payable under this Agreement to all
or any of the Finance Parties;
(v) defer the Termination Date;
(vi) amend the definition of Instructing Group; or
(vii) amend any provision which contemplates the need for
the consent or approval of all the Banks; or
(viii) in respect of the Security Agreements, when taken
with any other relevant amendments and/or waivers,
have an overall material adverse effect on the
position of the Banks; and
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(c) notwithstanding any other provisions of this Agreement, the
Facility Agent (and/or the Security Agent) shall not be
obliged to agree to any such amendment or waiver if the same
would:
(i) amend or waive any provision of this Clause 29
(Amendments), Clause 23 (Costs and Expenses) or Part
10 (Agency Provisions); or
(ii) otherwise amend or waive any of the Facility Agent's
or the Security Agent's rights under this Agreement
or subject the Facility Agent, the Security Agent or
the Arranger to any additional obligations under this
Agreement.
29.2 Amendment Costs If any Borrower requests any amendment or waiver in
accordance with Clause 29.1 (Amendment Procedures) then the Borrowers
shall, on the basis of joint and several liability on demand of the
Facility Agent, reimburse each Finance Party for all reasonable costs
and expenses (including legal fees) together with any VAT thereon
incurred by such Finance Party in responding to or complying with such
request.
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PART 13 - LAW, ARBITRATION AND LANGUAGE
30. Law
This Agreement shall be governed by, and shall be construed in
accordance with, Hungarian law.
31. Arbitration
31.1 Arbitration If any dispute, as between any Borrower and one or more of
the Arranger, the Facility Agent, the Security Agent, or any Bank(s),
arises in respect of this Agreement, including, but not limited to, any
question as to its existence, validity or termination, such dispute
shall be referred to and finally resolved by arbitration in accordance
with the Arbitration Rules of the United Nations Commission on
International Trade Law ("UNCITRAL") which are applicable at the time
of reference to such arbitration and which are deemed to be
incorporated by reference into this Clause 31.1. Any arbitration
proceedings commenced pursuant to this Clause 31.1 shall be conducted
by a tribunal comprising three (3) arbitrators, the first arbitrator
selected by the relevant Borrower(s), the second arbitrator selected by
the relevant Arranger, Facility Agent, the Security Agent, or Bank(s)
and the third arbitrator selected by agreement by the first and second
arbitrator, or failing such agreement such third arbitrator shall be
appointed by the Court of Arbitration attached to the Hungarian Chamber
of Commerce and Industry. The place and seat of any arbitration
proceedings commenced pursuant to this Clause 31.1 shall be Budapest,
Hungary. The language in which such arbitration shall be conducted
shall be Hungarian. Any judgement or determination rendered shall be
final and binding on the parties thereto and may be entered in any
court having jurisdiction or application may be made to such court for
an order of enforcement as the case may require. No failure or delay in
exercising any rights of any of the Arranger, the Facility Agent, the
Security Agent or the Bank(s) under this Agreement shall operate as a
waiver, or preclude the further exercise of such rights.
31.2 Service of Process for Arbitration Proceedings Each Borrower agrees
that the process by which any arbitration proceedings are begun may be
served on it by being delivered to the address identified with its
signature below or other its registered office for the time being. If
the appointment of the person(s) mentioned in this Clause 31.2 ceases
to be effective the relevant Borrower(s) shall immediately appoint a
further person in Hungary to act on its behalf in Hungary as agent for
the commencement of arbitration proceedings and, failing such
appointment within fifteen (15) days, the Facility Agent shall be
entitled to appoint such a person by notice to the Borrower. Nothing
contained in this Agreement shall affect the right to serve process in
any other manner permitted by law.
31.3 Consent to Enforcement Each Borrower hereby consents generally in
respect of any proceedings to the giving of any relief or the issue of
any process in connection with such proceedings including the making,
enforcement or execution against any property whatsoever (irrespective
of its use or intended use) of any order or judgement which may be made
or given in such proceedings.
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32. Language
This Agreement shall be executed in the English language. This
Agreement may be translated into the Hungarian language. In the event
that any dispute or question of interpretation arises, the English
language version shall prevail.
AS WITNESS the hands of the duly authorised representatives of the parties to
this Agreement the day and year first before written.
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