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10.33.3
The Directors
Horizon Exploration Limited
0 Xxxxxxxx Xxxx
Xxxxxxxxx
Xxxx
XX00 0XX
Dear Sirs:
We refer to the Facility Letter dated 23 August 1994 between Horizon
Exploration Limited (the Company) and the Bank of NT Xxxxxxxxxxx & Son Limited
(the Bank).
The Bank is pleased to confirm that the Facility is amended as follows and
except as otherwise specified in this letter (Amendment Letter No. 1), the
terms and expressions defined in the Facility Letter shall have the same
meaning and effect where used herein.
The amendments to the Facility are;
1. Clause 1 - Amount and Purpose - the opening paragraph is now to read:
"The maximum sum to be drawn under the Facility shall not exceed in
aggregate L.4,300,000 (Four Million Three Hundred Thousand Pounds
Sterling) (the Facility Amount) or subject to availability the
equivalent in any other major currency other than Pounds Sterling (the
Alternative Currency). The Facility Amount will remain available to
the Company until the 31 July 1995 after which date the amount
available for drawing will be reduced to L.3,400,000 (Three Million
Four Hundred Thousand Pounds Sterling).
2. Clause 1 - Amount and Purpose - paragraph a) is now to read:
a) "Within the Facility Amount a sub-limit of up to L.3,900,000 (Three
Million, Nine Hundred Thousand Pounds Sterling) which will remain
available until the 31 July 1995 after which date the sub-limit will
be reduced to L.3,000,000 (Three Million Pounds Sterling)".
Clause 1 - a) i) and ii) remain unchanged.
3. Clause 1 - Amount and Purpose - paragraph b) the sub-limit referred to
is now to read:
"L.350,000 (Three Hundred and fifty Thousand Pounds Sterling)"
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4. Clause 1 - Amount and Purpose - paragraph c) is now to read:
c) "Within the Facility Amount a sub-limit of up to L.50,000 (Fifty
Thousand Pounds Sterling) for the issuance of a guarantee in the
standard form in favour of HM Customs and Excise (the Duty Deferment
Guarantee) providing up to L.25,000 (Twenty Five Thousand Pounds
Sterling) per month for deferred payment terms on liabilities incurred
by the Company in respect of excise duties, levies, imposts and value
added tax due to HM Customs and Excise".
5. Clause 2 - Modus Operandi
A revised Modus Operandi in the form of Schedule II dated February
1995 is attached.
6. Clause 4 - Fees and Commissions - paragraph b) is now to read:
b) "Duty Deferment Guarantee
i) The fee for the Duty Deferment Guarantee will be 1.25% per annum on
the total liability thereunder (i.e. up to a maximum of L.50,000) with
a minimum charge of L.250.00".
7. Clause 6 - Security - the opening paragraph is now to read:
"As continuing security for an the Company's liabilities to the Bank
including those under the Term Loan Facility Letter dated 27 February
1995 between the Bank and the Company (the Term Loan Facility), the
Bank will require and/or continue to rely upon the following (the
Security Documentation)"
8. Clause 6 - Security - paragraph d) is now to read:
"d) A Counter Indemnity in the form of Schedule VI attached is to be
given by the Company to the Bank in respect of the Duty Deferment
Guarantee".
9. Clause 6 - Security - the final paragraph is now to read:
"The Security documentation referred to in sub-paragraphs e), f) and
l) hereof is transactional related and as such will be required from
time to time with reference thereto included in the Modus Operandi.
The Security provided by the Company to the Bank under the Term Loan
Agreement will also constitute security for the Facility provided
hereunder, which for the avoidance of doubt will include:
i) A Chattel Mortgage in a form acceptable to the Bank over
assets to be financed by the Bank under the Term Loan
Facility; and
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ii) A Deed of Subordination in a form acceptable to the bank in
respect of the Majority Shareholders Loan.
10. Clause 8 - Representations, Warranties and Undertakings - paragraph g)
is now to read:
g) "The Company's obligations hereunder will at all times during the
term of this Facility and the Term Loan Facility, rank in priority to
an existing and/or future indebtedness or commitments other than those
commitments which by law win automatically rank in priority; and"
11. Clause 9 - Covenants - the following paragraphs are to be added:
k) Not make any payments of dividends to the shareholders for so
long as the Company has any liability outstanding to the bank
under this Facility or the Term Loan Facility; and
l) The Company is to comply with the following financial
covenants which will be tested against the Company's audited
financial statements for the year ending 31 December 1995.
i) Gearing : Not greater than 0.80:1
ii) Leverage : Not greater than 2:1
iii) Interest Cover : Not less than 3.75 x
iv) Net Worth : Not less than L.3,600,000
Note the following definitions apply in respect of the financial covenants.
"Gearing" means the Company's interest bearing debt net of cash balances held
to Net Worth.
"Leverage" means all balance sheet liabilities to Net worth.
"Interest Cover" means operating profits before interest payable.
"Net Worth" means paid-up share capital, the retained earnings plus the
Majority Shareholders Loan less intangible assets and non-quoted investments.
"Majority Shareholders Loan" means the loan granted to the Company by Energy
Research International Limited c/o Caledonian Bank and Trust Limited, PO Box
1045, Georgetown, Grand Cayman, Cayman Islands. (The Majority Shareholder) in
the sum of USD 2,000,000 (Two Million United States Dollars) which for the
avoidance of doubt is subordinated to this Facility and the Term Loan Facility.
12. Clause 9 - Covenants - paragraph c) is now to read:
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c) "Ensure that insurances on and in relation to Company's business
and assets (including the assets referred to in the Term Loan Facility
are maintained with reputable underwriters or insurance companies
against such risks and to such extent as is usual for companies
carrying on a business such as that carried on by the Company and the
Bank's interests are to be noted thereon as `first loss payee'; and"
13. Clause 9 - Covenants - paragraph g) is now to read:
"Except under this Facility, the Term Loan Facility and the Majority
Shareholders Loan and not without the prior written notice to the
Bank, borrow or raise any money or incur any credit or give any
guarantees, indemnities or other assurances against financial loss
other than lease or hire purchase agreements entered into from time to
time by the Company for the purchase of capital equipment or the
office premises or the chartering of Chartered Ships which are to be
used by the Company to carry out work pursuant to the terms of a
Contract; and"
14. Clause 15 - Events of Default - paragraph a) i) to now read:
i) "If the Company defaults in the payment of any monies which may
become due to the Bank or there shall be any breach by the Company or
any other party of the terms and conditions of the Facility, the Term
Loan Facility, the Deed of Subordination or any other facility letter,
guarantee, security agreement, document or other obligation which the
Company may, from time to time have with the Bank, its associates or
subsidiaries; and"
15. Clause 15 - Events of Default - paragraph a) viii) to now read:
viii) "If any material provision of this Facility and/or the Term Loan
Facility and/or the Deed of Subordination and/or any security given in
respect thereof ceases in any respect to be in full force and effect
or to be continuing or is purported to be determined or becomes in
jeopardy or is invalid or unenforceable; or"
All other terms and conditions remain unchanged.
The amendments contained in Amendment No. 1 will become effective upon receipt
by the Bank of the following:
i) The duplicate copy of this letter signed by authorized offices
of the Company accepting and agreeing to abide by the amended
terms of the Facility; and
ii) The duplicate copy of this letter countersigned by the
Guarantor and the IOM Guarantor acknowledging the amendments
to the Facility; and
iii) The Company's acceptance of the Term Loan Facility.
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The Bank is pleased to have arranged the amendments and trusts that the
Facility will continue to operate to our mutual satisfaction.
Yours faithfully
for and on behalf of
The Bank of NT Xxxxxxxxxxx and Son Limited
/s/ [illegible signature] /s/ [illegible signature]
Authorized Signature Authorized Signature
IMPORTANT NOTICE
This amendment creates legal obligations which will be binding upon the Company
and the Company is advised to obtain appropriate legal advice. By the Company's
acceptance of this amendment the Company confirms that it has been advised by
the Bank to take independent legal advice regarding the contents of this
amendment and whether or not the Company has followed this advice, the Company
accepts this amendmement with full knowledge and understanding of its meaning
and effect.
We, Horizon Exploration Limited hereby accept and agree to abide by the amended
terms and conditions contained in this letter, Amendment No. 1.
for and on behalf of
Horizon Exploration Limited
/s/ Xxxx A.M. Xxxxxxxx
/s/ X.X. Xxxxxxxx
Authorized Signature(s) Date:
As IOM Guarantor, we, Seismic Exploration Limited, acknowledge the amendments
to the terms and conditions of the Facility, contained in Amendment No. 1.
for and on behalf of
Seismic Exploration Limited
/s/ X.X. Xxxxxxxx
/s/ Xxxxxx Xxxxxx
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Authorized Signature(s) Date:
As Guarantor, we, Exploration Holdings Limited, acknowledge the amendments to
the terms and conditions of the Facility.
for and on behalf of
Exploration Holdings Limited
/s/ Xxxx A.M. Xxxxxxxx
/s/ X.X. Xxxxxxxx
Authorized Signature(s) Date:
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