EXHIBIT 10.2
DATED 28th day of May 2004
$2,000,000
FACILITY AGREEMENT
between
OWLSTONE LIMITED
as Borrower
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-and-
ADVANCE NANOTECH LIMITED
as Lender
--------------------------------------------------
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THIS AGREEMENT is made on the 28th day of May 2004
BETWEEN
(1) OWLSTONE LIMITED whose registered office is at 00 Xxxxxxxxx,
Xxxxxxxxxx, Xxxxxx, XX0X 0XX ("the BORROWER") and;
(2) ADVANCE NANOTECH LIMITED whose registered office is at 00
Xxxxxxxxx, Xxxxxxxxxx, Xxxxxx, XX0X 0XX ("the LENDER") (which
expression shall, where applicable, include the Lender's
successors and assigns)
NOW IT IS HEREBY AGREED as follows:
1. INTERPRETATION
1.1 In this Agreement:
"ADVANCE" means, save as otherwise provided herein, an advance (as from time to
time reduced by repayment) made or to be made by the Lender hereunder. For the
avoidance of doubt "Advance" shall include amounts remitted to the Borrower by
the Lender pursuant to Clause 5.1;
"ANNUAL BUSINESS PLAN" means the annual business plan of the Borrower which
shall include a budget, projected cash flows and a statement of business
objectives.
"AVAILABLE FACILITY" means, at any time and save as otherwise provided herein,
$2,000,000 less the amount of each Advance which has then been made hereunder.
"BASE RATE" means the base rate from time to time published by Barclays Bank
plc;
"DEBENTURE" means the debenture of even date herewith in the agreed form
executed by the Borrower in favour of the lender.
"DESIGNATED ACCOUNT" means such bank account of the Borrower as the Borrower may
from time to time notify the Lender, the first such account being Account No.
00000000 at the Clydesdale Bank, 00 Xxxxxx Xxxxxx, Xxxxxx, XX0X 0XX. Sort code:
82 11 07.
"EVENT OF DEFAULT" means any of those events specified in Clause 18;
"EXIT EVENT" means either (i) the sale of the issued share capital to a third
party or parties acting in concert or (ii) the listing of any shares in the
Borrower on a recognised stock exchange;
"FACILITY" means the dollar loan facility granted to the Borrower in this
Agreement;
"GROUP" means the Borrower and its subsidiaries;
"PERIOD" means, save as otherwise provided herein, any of those periods
mentioned in Clause 6.
"SHAREHOLDERS AGREEMENT" means the agreement of even date herewith described as
such and made INTER ALIA between the parties hereto;
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"LOAN" means the aggregate principal amount for the time being outstanding
hereunder;
"NOTE OF DRAWDOWN" means a notice substantially in the form set out in the
Second Schedule;
"POTENTIAL EVENT OF DEFAULT" means any event which could reasonably be expected
to become (with the passage of time, the giving of notice, the making of any
determination hereunder or any combination thereof) an Event of Default;
"REPAYMENT DATE" means the earlier of the fifth anniversary of this Agreement of
the occurrence of an Exit Event;
1.2 Any reference in this Agreement to:
the "LENDER" shall be construed so as to include its and any subsequent
successors and assigns in accordance with their respective interests;
a "BUSINESS DAY" shall be construed as a reference to a day (other than a
Saturday or Sunday) on which Lenders are generally open for business in New York
and London;
a "CLAUSE" shall, subject to any contrary indication, be construed as a
reference to a clause hereof;
an "ENCUMBRANCE" shall be construed as a reference to a mortgage, charge,
pledge, lien or other encumbrance securing any obligation of any person or any
other type of preferential arrangement (including, without limitation, title
transfer and retention arrangements) having a similar effect;
a "HOLDING COMPANY" of a company of incorporation shall be construed as a
reference to any company or corporation of which the first-mentioned company or
corporation is a subsidiary;
"INDEBTEDNESS" shall be construed so as to include any obligation (whether
incurred as principal or as surety) fore the payment or repayment of money,
whether present or future, actual or contingent;
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 of 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 "SCHEDULE" shall, subject to any contrary indication, be construed as a
reference to a schedule hereto;
a "SUBSIDIARY" of a company or corporation shall be construed as a reference to
any company or corporation:
(i) which is controlled, directly or indirectly, by the
first-mentioned company or corporation;
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(ii) more than half the issued share capital of which is
beneficially owned, directly or indirectly, by the
first-mentioned company or corporation; or
(iii) which is a subsidiary of another subsidiary of the
first-mentioned company or corporation
and, for these purposes, a company of corporation shall be treated as being
controlled by another if that other company or corporation is able to direct its
affairs and/or to 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, without limitation, any penalty or
interest payable in connection with any failure to pay or any delay in paying
any of the same);
"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;
a "WHOLLY-OWNED SUBSIDIARY" of a company or corporation shall be construed as a
reference to any company or corporation which has no other members except that
other company or corporation and that other company's or corporation's
wholly-owned subsidiaries or persons acting on behalf of that other company or
corporation or its wholly-owned subsidiaries; 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 of corporation carries on
business including the seeking of liquidation, winding-up, reorganisation,
dissolution, administration, arrangement, adjustment, protection or relief of
debtors.
1.3 Save where the contrary is indicated, any reference in this Agreement
to:
(i) this Agreement or any other agreement or document shall 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, novated or
supplemented;
(ii) a statute shall be construed as a reference to such status as
the same may have been, or may from time to time be, amended
or re-enacted; and
(iii) a time of day shall be construed as a reference to New York
time.
1.4 Clause and Schedule headings are for ease of reference only.
2. THE FACILITY
The Lender grants to the Borrower, upon the terms and subject to the conditions
hereof, a loan facility in aggregate amount of $2,000,000 (two million US
Dollars).
3. PURPOSE
3.1 The Facility is intended for general corporate and working capital
purposes of the Borrower and the Borrower shall apply all amounts
raised by it hereunder in or towards satisfaction of the general
corporate financing requirements set out in the Schedules to the Annual
Business Plan.
3.2 Without prejudice to the obligations of the Borrower hereunder, the
Lender shall not be obliged to concern itself with the application of
amounts raised by the Borrower hereunder.
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4. CONDITIONS PRECEDENT
Save as the Lender may otherwise agree, the Borrower may not deliver any Notice
of Drawdown hereunder and no drawings will take place under Clause 5.1 unless
the Lender has confirmed to the Borrower that it has received all of the
documents listed in the First Schedule and that each is, in form and substance,
satisfactory to the Lender.
5. AVAILABILITY OF THE FACILITY
5.1 The Lender will within five days of the date hereof remit to the
Borrower an Advance in the amount of the US Dollar equivalent of
(pound)177,550, this being the sum of the first months cash flow
requirement as stated in the Annual Business Plan.
5.2 The Lender will, subject to Clause 4, remit by cheque or wire transfer
to the Designated Account on the 23rd day of each month (or if such day
is not a business day, on the next following business day) the amount
of negative cash flow set against the next following month in the
Annual Business Plan, provided that no remittance may be made under
Clause 5 which would cause the amount drawn under Clause 5 to exceed
the Available Facility, provided that the Lender shall have received:
5.2.1 satisfactory reports on the progress and development of the business of
the Borrower in accordance with the Annual Business Plan; and
5.2.2 all information required by Clause 29.
6. PERIODS
6.1 The period for which an Advance if 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.
6.2 The duration of each Period shall, save as otherwise provided herein,
be three months.
7. INTEREST
7.1 No interest is due on the Loan.
8. REPAYMENT
Subject to any requirement to make early repayment in accordance with Clause
18.1 the Loan shall be repayable by the Borrower on the Repayment Date.
9. CANCELLATION AND PREPAYMENT
9.1 The Borrower may, by giving to the Lender not less than thirty days'
prior notice to that effect, cancel the whole or any part (being an
amount of integral multiple of $100,000) of the Available Facility.
9.2 The Borrower may, if it has given to the Lender not less than thirty
days' prior notice to that effect, prepay without penalty the whole of
any Advance or any part of any Advance (being an amount or integral
multiple of $100,000) on the last day of any Period.
9.3 Any notice of cancellation or prepayment given by the Borrower pursuant
to Clause 9.1 or 9.2 shall be irrevocable, shall specific the date upon
which such cancellation or prepayment is to be made and the amount of
such cancellation or prepayment and, in the case of a notice of
prepayment, shall oblige the Borrower to make such prepayment on such
date.
9.4 The Borrower shall not repay all or any part of the Loan except at the
times and in the manner expressly provided for in the Agreement and
shall not be entitled to reborrow any amount repaid.
10. TAXES
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10.1 All payments to be made by the Borrower to the Lender hereunder shall
be made free and clear of and without deduction for or on account of
tax unless the Borrower is required to make such a payment subject to
the deduction or withholding of tax, in which case the sum payable by
the 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,
the Lender 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.
10.2 Without prejudice to the provisions of Clause 10.1, if the Lender is
required to make any payment on account of tax (not being a tax imposed
on the net income of the Lender by the jurisdiction in which it is
incorporated) or otherwise on or in relation to any sum received or
receivable by it hereunder (including, without limitation, any sum
received or receivable under this Clause 10) or any liability in
respect of any such payment is asserted, imposed, levied or assessed
against the Lender, the Borrower shall, upon demand of the Lender,
promptly indemnify the Lender against such payment or liability,
together with any interest, penalties and expenses payable or incurred
in connection therewith.
10.3 If the Lender intends to make a claim pursuant to Clause 10, it shall
notify the Borrower of the event by reason of which it is entitled to
make such claim provided that nothing herein shall require the Lender
to disclose any confidential information relating to the organisation
of its affairs.
11. TAX RECEIPTS
11.1 If, at any time, the Borrower is required by law to make any deduction
or withholding from any sum payable by it hereunder (or if thereafter
there is any change in the rates at which or the manner in which such
deductions or withholdings are calculated), the Borrower shall promptly
notify the Lender.
11.2 If the Borrower makes any payment hereunder in respect of which it is
required to make any deduction of 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 Lender, promptly upon receipt
of the same, 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 such
payment.
12. INCREASED COSTS
12.1 If, by reason of any change in law of in its interpretation or
administration:
(a) there is any increase in the cost to the Lender of funding or
maintaining all or any of the advances comprised in a class of
advances formed by or including the Advances; or
(b) the Lender becomes liable to make any payment on account of
tax or otherwise (not being a tax imposed on the net income of
the Lender by the jurisdiction in which it is incorporated) on
or calculated by reference to the amount of the Advances
and/or to any sum received or receivable by it hereunder,
then the Borrower shall, from time to time on demand of the Lender, promptly pay
to the Lender amounts sufficient to indemnify it or any such holding company
against, as the case me be, (1) such increased cost (or such proportion of such
increased cost as is, in the opinion of the Lender, attributable to its funding
or maintaining Advances) or (2) such liability.
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12.2 If the Lender intends to make a claim pursuant to Clause 12.1, it shall
notify the Borrower of the event by reason of which it is entitled to
do so provided that nothing herein shall require the Lender to disclose
any confidential information relating to the organisation of its
affairs.
13. ILLEGALITY
If, at any time, it is unlawful for the Lender to make, fund or allow to remain
outstanding all or any of the Advances, then the Lender shall, promptly after
becomes aware of the same, deliver to the Borrower a certificate to that effect
and:
(i) the Lender shall not thereafter be obliged to make any
Advances and the amount of the Available Facility shall be
immediately reduced to zero; and
(ii) if the Lender so requires, the Borrower shall on such date as
the Lender shall have specified repay each outstanding Advance
and all other amount owing to the Lender hereunder.
In the event that this Clause shall become operative, the
Lender will discuss in good faith with the Borrower what
alternative funding methods shall be available and agrees to
give assistance to the Borrower in obtaining such funding.
14. REPRESENTATIONS
The Borrower represents that:
(i) it is a corporation duly organised under the Laws of England
with power to enter into this Agreement and to exercise its
rights and perform its obligations hereunder and all corporate
and other action required to authorise its execution of this
Agreement and its performance of its obligations hereunder has
been duly taken;
(ii) all acts, conditions and things required to be done, fulfilled
and performed in order (a) to enable it lawfully to enter
into, exercise its rights under and perform and comply with
the obligations expressed to be assumed by it in this
Agreement and the Debenture and (b) to ensure that the
obligations expressed to be assumed bu it in this Agreement
and the Debenture are legal, valid and binding;
(iii) it has not taken any corporate action nor have any other steps
been taken or legal proceedings been started or (to the best
of its knowledge and belief) threatened against the Borrower
for its winding-up, dissolution, administration or
re-organisation or for the appointment of a receiver,
administrator, administrative received, trustee or similar
officer of it or of any or all of its assets or revenues;
(iv) it is not in breach of or in default under any agreement to
which it is a party or which is binding on it or any of its
assets to an extent or in a manner which might have a material
adverse effect on the business or financial condition of the
Group;
(v) no action or administrative proceeding of or before any court
of agency which might have a material adverse effect on the
business or financial condition of the Borrower has been
started or threatened;
(vi) all of the written information supplied by the Borrower to the
Lender in connection herewith is true, complete and accurate
in all material respects and it is not aware of any material
facts of circumstances that have not been disclosed to the
Lender and which might, if disclosed, adversely affect the
decision of a person considering whether or not to provide
finance to the Borrower;
(vii) save as permitted hereunder no encumbrance exists over all or
any of the present or future revenues or assets of the
Borrower;
(viii) the execution by the Borrower of this Agreement or the
Debenture and the Borrower's exercise of its rights and
performance of its obligations hereunder or thereunder will
not result in the existence of nor oblige the Borrower to
create any
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encumbrance over all of any of its present or future revenues
or assets (other than as created by the Debenture);
(ix) the execution by the Borrower of this Agreement of the
Debenture and the Borrower's exercise of its rights and
performance of its obligations hereunder or thereunder do not
and will not:
(a) conflict with any agreement, mortgage, bond or other
instrument or treaty to which such party is a party
or which is binding upon it or any of its assets;
(b) conflict with such party's constitutional documents
and rules and regulations; or
(c) conflict with any applicable law, regulation or
official or judicial order.
15. FINANCIAL INFORMATION
15.1 The Borrower shall:
(i) as soon as the same become available, but in any event within
120 days after the end of each of its financial years, deliver
to the Lender its consolidated financial statements for such
financial year; and
(ii) from time to time on the request of the Lender, furnish the
Lender with such information about the business and financial
condition of the Group as the Lender may reasonably require.
15.2 The Lender shall ensure that:
(i) each set of financial statements delivered by it pursuant to
Clause 15.1 is prepared on the same basis as was used in the
preparation of any financial statements previously prepared
and in accordance with accounting principles generally
accepted in England and consistently applied; and
(ii) each set of financial statements delivered by it pursuant to
paragraph (i) of Clause 15.2 is audited by auditors reasonably
acceptable to the Lender as soon as reasonably practicable
following preparation of such accounts.
16. FINANCIAL COVENANT
16.1 The Borrower undertakes that it shall use its best endeavours to
conduct its business in accordance with the provisions of the Annual
Business Plan and will use its best endeavours to ensure that aggregate
expenditure levels on a monthly basis shall be no greater than those
shown in the Schedules to the Annual Business Plan.
17. COVENANTS
17.1 The Borrower shall:
(i) obtain, comply with the terms of and do all that is necessary
to maintain in full force and effect all material
authorisations, approvals, licenses and consents required in
or by the laws and regulations of is jurisdiction of
incorporation to enable it lawfully to enter into and perform
its obligations under this Agreement or to ensure the
legality, validity, enforceability or admissibility in
evidence in its jurisdiction of incorporation of this
Agreement;
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(ii) maintain insurances on and in relation to its business and
material assets 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 Group.
(iii) after the delivery of any Notice of Drawdown and before the
proposed making of the Advance requested therein, notify the
Lender of the occurrence of any event which results in or may
reasonably be expected to result in any of the representations
contained in Clause 14 being untrue in any material respect at
or before the time of the proposed making of such Advance;
(iv) promptly inform the Lender of the occurrence of any Event of
Default or Potential Event of Default and, upon receipt of a
written request to that effect from the Lender, confirm to the
Lender that, save as previously notified to the Lender or as
notified in such confirmation, no Event of Default or
Potential Event of Default has occurred; and
(v) ensure that at all times the claims of the Lender against it
under this Agreement rank at least PARI PASSU with the claims
of all its other unsecured creditors save those whole claims
are preferred by any bankruptcy, insolvency, liquidation or
other similar laws of general application.
17.2 No member of the Group shall, without the prior written consent of the
Lender:
(i) pay, make or declare any dividend or other distribution in
respect of any financial year;
(ii) create or permit to subsist any encumbrance over all or any of
its present or future revenues or assets other than (1) the
Debenture or (2) an encumbrance which has been disclosed in
writing to the Lender prior to the execution hereof and
secures only indebtedness outstanding at the date hereof;
(iii) make any loans, grant any credit (save in the ordinary course
of business) or give any guarantee or indemnity (except as
required hereby) to or for the benefit of any person or
otherwise voluntarily assume any liability, whether actual or
contingent, in respect of any obligation of any other person;
(iv) issue any further shares or alter any rights attaching to its
issued shares in existence at the date hereof; or
(v) (disregarding sales of stock in trade in the ordinary course
of business) sell, lease, transfer or otherwise dispose of, by
one of more transactions or series of transaction (whether
related or not), the whole or any part of its revenues or its
assets.
18. EVENTS OF DEFAULT
18.1 If:
(i) the Borrower shall fail to pay, within three business days of
the due date of any such further period as may be agreed in
writing by the Lender, any sum due from it hereunder at the
time, in the currency and in the manner specified herein; or
(ii) any representation or statement made by the Borrower in this
Agreement or in any notice or other document, certificate or
statement delivered by it pursuant hereto or in connection
herewith is or proves to have been misleading or materially
incorrect when made; or
(iii) the Borrower fails duly to perform or comply with any of the
obligations expressed to be assume by it in Clause 15 or 16;
or
(iv) the Borrower fails duly to perform of comply with any other
obligation expressed to be assumed by it in this Agreement or
the Debenture and such failure, if capable of remedy, is not
remedied within fourteen days after the Lender has given
notice thereof to such party; or
(v) any indebtedness of any member of the Group being in aggregate
in excess of (pound)10,000 is not paid when due or is declared
to be or otherwise becomes due and
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payable prior to its specified maturity or any creditor or
creditors of any members of the Group become entitled to
declare any indebtedness of such party due and payable prior
to its specified maturity; or
(vi) any member of the Group is unable to pay its debts as they
fall due, commences negotiations 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
(vii) any member of the Group takes any corporate action or other
steps are taken or legal proceedings are started for its
winding-up, dissolution, administration or re-organisation or
for the appointment of a receiver, administrator,
administrative receiver, trustee or similar officer of it or
of any or all of its revenues and assets save that this clause
will not apply in respect of any action taken vexatiously or
without cause; or
(viii) any execution of distress is levied against, or an
encumbrances takes possession of the whole or any material
part of, the property, undertaking or assets of any member of
the Group; or
(ix) by or under the authority of any government, (a) the
management of any member of the Group is wholly or partially
displaced or the authority of any member of the Group in the
conduct of its business is wholly or partially curtailed or
(b) all or a majority of the issued shares of the Borrower or
the whole or any party (the book value of which is twenty per
cent or more of the book value of the whole) of the revenues
or assets of the Group is seized, nationalised, expropriated
or compulsorily acquired; or
(x) the Borrower repudiates this Agreement or the Debenture or
does or causes to be done any act or thing evidencing an
intention to repudiate this Agreement or the Debenture; or
(xi) at any time any act, condition or thing required to be done,
fulfilled or performed in order (a) to enable the Borrower
lawfully to enter into, exercise its rights under and perform
the obligations expressed to be assumed by it in this
Agreement or the Debenture, (b) to ensure that the obligations
expressed to be assumed by the Borrower in this Agreement or
the Debenture are legal, valid and binding or (c) to make this
Agreement or the Debenture admissible in evidence in Englad is
not done, fulfilled or performed; or
(xii) at any time it is or becomes unlawful for the Borrower to
perform or comply with any or all of its obligations hereunder
or the Debenture or any of the obligations of the Borrower
hereunder or thereunder are not or cease to be legal, valid
and binding which would have a material adverse effect on the
Lender; or
(xiii) any circumstances arise which in the reasonable opinion of the
Lender constitute a material adverse change in the business,
assets or financial condition of the Borrower;
then, and in any such case and at any time thereafter, the Lender may by written
notice to the Borrower:
(a) declare the Advances to be immediately due and payable
(whereupon the same shall become so payable together with any
other sums then owed by the Borrower hereunder) or declare the
Advances to be due and payable on demand of the Lender; and/or
(b) declare that any undrawn portion of the Facility shall be
cancelled, whereupon the same shall be cancelled and the
Available Facility shall be reduced to zero.
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18.2 If, pursuant to Clause 18.1, the Lender declares the Advances to be due
and payable on demand of the Lender, then, and at any time thereafter,
the Lender may by written notice to the Borrower:
(i) call for repayment of the Advances on such date as it may
specific in such notice (whereupon the same shall become due
and payable on such date together with any other sums then
owed by the Borrower hereunder) or withdraw its declaration
with effect from such date as it may specify in such notice;
and/or
(ii) select as the duration of any Period which begins whilst such
declaration remains in effect a period of one month or less.
19. DEFAULT INTEREST AND INDEMNITY
19.1 If any sum due and payable by the Borrower hereunder is not paid on the
due date or if any sum due and payable by the Borrower under any
judgment of any court in connection herewith is not paid on the date of
such judgment, the period beginning on such due date or, as the case
may be, the date of such judgment and ending on the date upon which the
obligation of the Borrower to pay such sum (the balance thereof for the
time being unpaid being herein 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 be selected by the
Lender.
19.2 During each such period relating thereto as is mentioned in Clause 19.1
an unpaid sum shall bear interest at the rate per annum which is the
sum from time to time of three per cent and the Base Rate from time to
time applicable thereto.
19.3 Any interest which shall have accrued under Clause 19 in respect of an
unpaid sum shall be due and payable and shall be paid by the Borrower
at the end of the period by reference to which it is calculated or on
such other date or dates as the Lender may specific by written notice
to the Borrower.
19.4 The Borrower undertakes to indemnify the Lender against:
(i) any cost, claim, loss, expense (including legal fees) or
liability together with any VAT thereon, which it may sustain
or incur as a consequence of the occurrence of any Event of
Default or any default by the Borrower in the performance of
any of the obligations expressed to be assumed by it in this
Agreement; and
(ii) any loss it may suffer as a result of its funding an Advance
requested by the Borrower hereunder but not made by reason of
the operation of any one of more of the provisions hereof.
20. PAYMENTS
20.1 On each date on which this Agreement requires an amount denominated in
US Dollars to be paid by the Borrower, the Borrower shall make the same
available to the Lender by payment in US Dollars and in immediately
available, freely transferable, cleared funds to the Lender's bank
account as the Lender may have specified for this purpose.
20.2 On each date on which this Agreement requires an amount denominated in
US Dollars to be paid by the Lender to the Borrower hereunder, the
Lender shall make the same available to the Borrower by payment in
Dollars and in immediately available, freely transferable, cleared
funds to the Designated Account (or such account as the Borrower may
have specified for this purpose).
20.3 All payments required to be made by the Borrower hereunder 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.
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20.4 All moneys received, recovered or realised by the Lender by virtue of
Clause 20.2 may, in the Lender's discretion, be credited to a suspense
or impersonal account and many be held in such account for so long as
the Lender thinks fit pending the application from time to time (as the
Lender may think fit) of such moneys in or towards the payment and
discharge of any amounts owing by the Borrower to the Lender hereunder.
21. SET-OFF
The Borrower authorises the Lender to apply any credit balance to which the
Borrower is entitled on any account of the Borrower with the Lender in
satisfaction of any sum due and payable from the Borrower to the Lender
hereunder but unpaid; for this purpose, the Lender 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. The Lender shall not be obliged
to exercise any right given to it by this Clause 21.
22. COSTS AND EXPENSES
22.1 The Borrower shall, from time to time on demand of the Lender,
reimburse the Lender for all costs and expenses (including legal fees)
together with any VAT thereon incurred in or in connection with the
preservation and/or enforcement of any of its rights under this
Agreement.
22.2 The Borrower shall pay all stamp, registration and other taxes to which
this Agreement or any judgment given in connection herewith is or at
any time may be subject and shall, from time to time on demand,
indemnify the Lender against any liabilities, costs, claims and
expenses resulting from any failure to pay or any delay in paying any
such tax.
23. BENEFIT OF AGREEMENT
This Agreement shall be binding upon and enure to the benefit of each party
hereto and its or any subsequence successors and assigns.
24. ASSIGNMENTS
24.1 The Borrower shall not be entitled to assign or transfer all or any of
its rights, benefits and obligations hereunder.
24.2 The Lender may assign all or any of its rights and benefits hereunder
to:
24.2.1 any other person provided that the Lender can demonstrate to the
reasonable satisfaction of the Borrower that person is of good credit
standing and does not have any interests which conflict with those of
the Borrower; or
24.2.2 any subsidiary or holding company of the Lender or other subsidiary of
such holding company (as such terms are defined in the Companies Act
1985) provided that the Borrower agrees to guarantee the performance of
the obligations under this Agreement of such company.
25. CALCULATION AND EVIDENCE OF DEBT
25.1 The Lender shall maintain in accordance with its usual practice
accounts evidencing the amounts from time to time lent by and owing to
it hereunder.
26. REMEDIES AND WAIVERS
No failure by the Lender to exercise, nor any delay by the Lender in exercising,
any right or remedy hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any right or
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remedy prevent any further or other exercise thereof or the exercise of any
other right or remedy. The rights and remedies herein provided are cumulative
and not exclusive of any rights or remedies provided by law.
27. PARTIAL INVALIDITY
If, at any time, any provision hereof 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 hereof nor the
legality 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 Each communication to be made hereunder shall be made in writing but,
unless otherwise states, may be made by telefax or letter.
28.2 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 days' written notice to the one specified another address)
be made or delivered to that other person at the address identified
with its signature below and shall be deemed to have been made or
delivered at the opening of business on the business day following the
date of despatch (in the case of any communication made by telefax) or
(in the case of any communication made by letter) when left at that
address or (as the case may be) ten days after being deposited in the
post postage prepaid in an envelope addresses to it at that address
provided that any communication or document to be made or delivered by
the Borrower to the Lender shall be effective only when received by the
Lender and then only if the same is expressly marked for the attention
of the department or officer identified with the Lender's signature
below (or such other department or officer as the Lender shall from
time to time specific for this purpose).
29. INFORMATION OBLIGATIONS OF THE COMPANY
29.1 The Borrower undertakes to the Lender that it shall keep the Lender
informed of material matters relating to the progress of its business
and that of every subsidiary of the Borrower to such extent in and in
such form and detail as the Lender may from time to time require and
shall supply such written particulars of any matters concerned with and
arising out of the activities of the Borrower and any of its
subsidiaries as the Lender may from time to time require;
29.2 Without limiting the generality of Clause 7.1, the Borrower shall
deliver within 28 days of the end of the each calendar month to the
Lender, and information pack comprising:
29.2.1 Monthly management accounts including:
7.2.1.1 profit and loss account for month and year to date with
comparison to budget;
7.2.1.2 cash flow for month and year to date with comparison to budget;
7.2.1.3 balance sheet with comparison to budget;
29.2.2 projected cash flows for the next quarter;
29.2.3 projected profit and loss account for the remainder of the then current
financial period;
29.3 Without limiting the generality of Clauses 7.1 or 7.2 the Borrower
shall deliver forthwith upon the same becoming available and not in any
event later than 4 months after the end of each relevant financial year
to the Lender, copies of the audited profit and loss accounts and
audited balance sheets of the Group and the audited consolidated
balance sheet of the Group all in respect of each financial year of the
Borrower and each of its subsidiaries;
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29.4 The Borrower shall prepare and deliver to the Lender at least 30 days
before (but no sooner than 60 days before) the commencement of each of
its financial years the Annual Business Plan in respect of the
forthcoming financial year and the Borrower shall endeavour to agree
the content of the Annual Business Plan with the Lender prior to so
delivering it and in any event procure that the budget included in each
such Annual Business Plan shall be in such form and detail as the
Lender shall require from time to time;
30. LAW
This Agreement shall be governed by, and shall be construed in accordance with
English law.
31. JURISDICTION
31.1 Each of the parties hereto irrevocably agrees that the courts of
England shall have jurisdiction to hear and determine any suit, action
or proceeding, and to settle any disputes, which may arise out of or in
connection with this Agreement and, for such purposes, irrevocably
submits to the jurisdiction of such courts.
AS WITNESS the hands of the duly authorised representatives of the parties
hereto on the date set out above.
THE BORROWER
OWLSTONE LIMITED
By: /s/ Xxxxxx X. Xxxxx
-----------------------
Address: 65 Panton
-----------------------
Xxxxxxxxx XX0 0XX
-----------------------
THE LENDER
ADVANCE NANOTECH LIMITED
By: /s/ Xxxxxx Xxxxxxx
-----------------------
Address: illegible
-----------------------
-----------------------
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THE FIRST SCHEDULE
CONDITION PRECEDENT DOCUMENTS
(i) a copy, certified a true copy by a duly authorised officer of the
Borrower, of its Memorandum and Articles of Association;
(ii) a copy, certified a true copy by a duly authorised officer of the
Borrower, of a Board Resolution of the Borrower approving the
execution, delivery and performance of this Agreement and the Debenture
and the terms and conditions hereof and thereof and authorising a named
person or persons to sign this Agreement and any documents to be
delivered by the Borrower pursuant hereto;
(iii) a certificate of a duly authorised officer of the Borrower setting out
the names and signatures of the persons authorised to sign, on behalf
of the Borrower, this Agreement, the Debenture and any documents to be
delivered by the Borrower pursuant hereto or thereto; and
(iv) the Debenture to be executed by the Borrower.
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THE SECOND SCHEDULE
NOTICE OF DRAWDOWN
From: Owlstone Limited
To: Advance Nanotech Limited
Dated: _______________________
Dear Sirs,
1. We refer to the agreement (the "Facility Agreement") dated ______, 2004
and made between ourselves as borrower and yourselves as lender. Terms
defined in the Facility Agreement shall have the same meaning in this
notice.
2. We hereby give you notice that, pursuant to the Facility Agreement and
on [date of proposed advance], we wish to borrow an Advance in the
amount of [____] upon the terms and subject to the conditions contained
therein.
3. We confirm that, at the date hereof, the representations set out in
Clause 14 of the Facility Agreement are true and no Event of Default of
Potential Event of Default has occurred.
4. We confirm that the Advance is to provide working capital for the month
of [_______].
5. The proceeds of this drawdown should be credited to [insert account
details].
Yours faithfully,
---------------------------------
For an on behalf of Owlstone Limited
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