CONFORMED COPY
DATED 7th AUGUST 1998
NATIONAL WESTMINSTER BANK Plc
(as Agent)
- and -
NATIONAL WESTMINSTER BANK Plc
(as a Bank)
- and -
THE FIRST NATIONAL BANK OF MARYLAND
(as a Bank)
- and -
COMERICA BANK
(as a Bank)
- and
HUNTINGDON LIFE SCIENCES GROUP plc
HUNTINGDON LIFE SCIENCES LIMITED
- and -
HUNTINGDON LIFE SCIENCES, INC.
------------------------------
FOURTH INTERCREDITOR AGREEMENT
replacing the third Intercreditor
Agreement
between the same parties dated 17th
March 1998
-------------------------------------------------------------
TABLE OF CONTENTS
Clause Heading Page Number
1. INTERPRETATION.................................2
2. PRIORITIES.....................................5
3. RISK-SHARING BY FNBM...........................6
4. RISK-SHARING BY FNBM AND COMERICA..............8
6. CO-OPERATION..................................10
7. NO OBLIGATIONS TO BORROWERS...................10
9. COUNTERPARTS..................................11
10. LAW AND JURISDICTION..........................11
SCHEDULE 1 Participation in Risk-Sharing...............12
SCHEDULE 2 Security....................................13
THIS AGREEMENT is made the 7th day of August 1998
BETWEEN:
(1) NATIONAL WESTMINSTER BANK Plc of 3rd Floor, Juno Court, 25 Prescot
Street, London E1 8BB (as Agent) (the "Agent");
(2) NATIONAL WESTMINSTER BANK Plc of Phase 2, King's Cross House, 200
Pentonville Road, London N1 9HL (as a Bank) ("NatWest");
(3) THE FIRST NATIONAL BANK OF MARYLAND of 00 Xxxxx Xxxxxxx Xxxxxx,
Xxxxxxxxx, XX00000, Xxxxxx Xxxxxx of America (as a Bank) ("FNBM");
(4) COMERICA BANK (as a Bank) ("Comercia");
(5) HUNTINGDON LIFE SCIENCES GROUP plc a company incorporated in England and
Wales with registered number 502370 of Xxxxxxx Xxxx, Xxxxxxxxx,
Xxxxxxxxxx, Xxxxxxxxxxxxxx XX00 0XX ("the Parent");
(6) HUNTINGDON LIFE SCIENCES LIMITED a company incorporated in England and
Wales with registered number 1815730 of Xxxxxxx Xxxx, Xxxxxxxxx,
Xxxxxxxxxx, Xxxxxxxxxxxxxx XX00 0XX ("HLSL"); and
(7) HUNTINGDON LIFE SCIENCES, INC. a company incorporated under the
laws of the State of Delaware, USA, having its registered office at
0 Xxxx Xxxxxxxxxx Xxxxxx, Xxxx xx Xxxxx, Xxxxxx of Kent, State of
Delaware, United States of America ("HLS").
WHEREAS:
(A) By a facilities agreement dated 1st November 1995 between the
Borrowers (1), the Banks (as defined therein) (2) and the Agent (3)
as subsequently amended (the "Facilities Agreement") the Banks made
available to the Borrowers certain facilities.
(B) By various security agreements and guarantees and debentures the
Borrowers granted security over their respective assets in favour
of the Agent as continuing security for their obligations under the
Facilities Agreement.
(C) By a facility letter dated 17th March 1998 (the "New Facility Letter")
addressed to the Borrowers, NatWest in its capacity as the Overdraft Bank
thereunder agreed to provide the First New Overdraft Facility and the
Second New Overdraft Facility to the Parent and HLSL on the terms and
conditions set out therein and FNBM and NatWest in their capacity as
Banks agreed to share the risk incurred by NatWest as Overdraft Bank in
providing the First New Overdraft Facility and FNBM, NatWest and
Comerica in their capacity as Banks agreed to share the risk incurred
on the terms and conditions as set out herein.
(D) By supplemental deeds dated 26th February 1998 the Borrowers have
extended the security created by the documents referred to in
Recital B to cover all of the obligations and liabilities of the
Borrowers to the Banks howsoever incurred.
(E) By a facility letter of today's date (the "Bridging Facility
Letter") addressed to the Borrowers, NatWest in its capacity as the
Overdraft Bank has agreed to provide the Bridging Facility to the
Parent and HLSL on the terms and conditions set out therein and
FNBM, Coamerica and NatWest in their capacity as Banks have agreed
to grant super priority to the Overdraft Bank with respect to the
amount outstanding at any time under the Bridging Facility.
NOW THIS AGREEMENT WITNESSES as follows:
1. INTERPRETATION
1.1 In this Agreement (including the Recitals), unless the context
otherwise requires or unless otherwise defined or provided for in
this Agreement, words and expressions shall have the same meanings
as are attributable to them under the Facilities Agreement. In
addition the following words and expressions shall have the
respective meanings ascribed to them:
"Bridging Facility" means the (pound)1,000,000 bridging facility to
be provided by the Overdraft Bank by means of an overdraft on the
current accounts of the Parent and HLSL at the Overdraft Bank;
"First New Overdraft Facility" bears the same meaning as in the New
Overdraft Document;
"First New Overdraft Outstandings" means at any time the aggregate
amount outstanding by way of overdraft under the First New
Overdraft Facility;
"First Participation Percentage" means, at any time, in relation to
NatWest and FNBM the percentage of their participation in the risk
incurred by NatWest under the First New Overdraft Facility as set
out in Column 2 of Schedule 1;
"First Super Priority Obligations" means all moneys owing,
obligations and other liabilities of the Parent and HLSL to the
Overdraft Bank under the Bridging Facility;
"Junior Obligations" means the NatWest Obligations;
"NatWest Facility Document" means a facility letter dated 10th
September 1997 (as amended by a letter dated 26th February 1998)
from NatWest to HLSL and the Parent in respect of overdraft, forex
daytime exposure and terminable indemnity facilities in an
aggregate amount of (pound)995,000;
"NatWest Obligations" means the (pound)100,000 (plus interest
thereon) owing by the Parent and/or HLSL to NatWest in respect of
the Residual Overdraft together with all moneys owing to NatWest in
respect of the terminable indemnity forex and daylight exposure
Facilities made available under the NatWest Facility Document;
"Net Proceeds" means in relation to the Security the net proceeds
of sale or other realisation of the assets subject to the Security
after discharge of all direct costs incurred in such sale or
realisation, the discharge of any prior ranking claims and, where
appropriate, all costs, charges, fees and expenses of any receiver
appointed pursuant to the Security;
"New Overdraft Document" means the facility letter dated 17th March
1998 from NatWest as Overdraft Bank to the Borrowers;
"Outstandings" means in relation to each Bank, at the time of a
distribution of the Net Proceeds, the amount owing to that Bank by
all the Borrowers under the Facilities Agreement, and in respect of
NatWest and FNBM also under the First New Overdraft Facility (and
in calculating the Outstandings in respect of FNBM, the Agent will
take into account FNBM's liability to NatWest under the risk
sharing provisions contained in Clause 3 of this Agreement);
"Priority Obligations" means all moneys owing, obligations and
other liabilities of the Borrowers to the Banks and the Agent
pursuant to the Facilities Agreement and under the First New
Overdraft Facility;
"Residual Overdraft" means the residual overdraft facility provided
under the NatWest Facility Document;
"Second New Overdraft Facility" bears the same meaning as in the New
Overdraft Document;
"Second New Overdraft Outstandings" means at any time the aggregate
amount outstanding by way of overdraft under the Second New
Overdraft Facility;
"Second Participation Percentage" means at any time, in relation to
NatWest, FNBM and Comerica the percentage of their participation in
the risk incurred by NatWest under the Second New Overdraft
Facility as set out in Column 3 of Schedule 1;
"Security" means all the security executed by the Borrowers in
favour of the Agent as security trustee for the Secured Parties
details of which are listed in Schedule 2 to this Agreement
together with any further security so created by the Borrowers or
any of them;
"Sharing Percentages" means in relation to each Bank a percentage
calculated using the following formula:
A = B x 100
C
A = Sharing Percentage of the Bank in question B = Outstandings of
the Bank in question C = Total Outstandings; and
"Super Priority Obligations" means all moneys owing, obligations
and other liabilities of the Borrowers to the Overdraft Bank and
the Banks under the Second New Overdraft Facility; and
"Total Outstandings" means, at the time of a distribution of the
Net Proceeds, the aggregate amount owing to all the Banks by the
Borrowers under the Facilities Agreement and the First New
Overdraft Facility.
1.2 Interpretation
In this Agreement, unless the context otherwise requires:
(a) references to any persons shall be construed so as to
include that person's assigns, transferees or successors in title;
(b) references to any document (or any specified provisions
of any document) shall be construed as references to
such document or that provision as amended or novated
or supplemented or replaced, as the case may be, from
time to time;
(c) references to the singular shall include the plural and
vice versa and references by way of male, female or
neuter pronoun shall include references to all genders;
and
(d) references to Clauses and Schedules are to be construed
as references to the Clauses of, and Schedules to, this
Agreement as amended or varied from time to time.
2. PRIORITIES
2.1 It is hereby agreed by and between the parties to this Agreement
that on enforcement of the Security the Net Proceeds shall be
applied:
(i) first, in discharge of the First Super Priority Obligations;
(ii) second, in discharge of the Super Priority Obligations;
(iii) third, in discharge of the Priority Obligations; and
(iv) fourth, in discharge of the Junior Obligations.
2.2 The Security is a continuing security and the ranking of the First
Super Priority Obligations, Super Priority Obligations, the
Priority Obligations and the Junior Obligations as provided for in
this Agreement shall not be affected by any fluctuation in the
amounts from time to time of the First Super Priority Obligations,
Super Priority Obligations, the Priority Obligations or the Junior
Obligations or by the existence at any time of a credit balance on
any current or other accounts.
2.3 The moneys owing and obligations and other liabilities of the
Overdraft Borrowers to the Banks in respect of the Second New
Overdraft Facility shall rank pari passu in all respects so that on
enforcement the Net Proceeds shall be shared between the Banks pro
rata on the basis of their respective Second Participation
Percentages.
2.4 For the avoidance of doubt it is confirmed that the moneys owing
and obligations and other liabilities of the Borrowers to the Banks
and the Agent under the Facilities Agreement and of the Overdraft
Borrowers to NatWest and FNBM in respect of the First New Overdraft
Facility shall rank pari passu in all respects and that on
enforcement, after payment of the First Super Priority Obligations
and the Super Priority Obligations, the Net Proceeds shall be
shared between the Banks pro rata on the basis of their respective
Sharing Percentages.
2.5 In the event of the Group making any early repayment of the
Facilities or of amounts due under the New Facility Letter whether
by voluntary repayment from cashflow or from the sale of any assets
such reduction will be applied in accordance with the priorities
set out in Clause 2.1 as if they were Net Proceeds.
3. RISK-SHARING BY FNBM
3.1.1 FNBM hereby irrevocably and unconditionally agrees and undertakes to
NatWest to indemnify NatWest and to keep NatWest fully and effectively
indemnified on demand and free of any set-off, counterclaim or other
deductions against all losses, liabilities, costs, charges and
expenses which NatWest at any time incurs or suffers arising out
of or in connection with the provision of the First New
Overdraft Facility (including for the avoidance of doubt the First
New Overdraft Outstandings) (other than in respect of gross negligence
or wilful misconduct on the part of NatWest) (the "Liabilities")
PROVIDED THAT FNBM shall only be obliged to indemnify NatWest under
this Clause to the extent of an amount equivalent to
its First Participation Percentage of the Liabilities.
3.1.2 A certificate of an officer of NatWest as to the amount of the
Liabilities shall, save in the case of manifest error, be binding
on FNBM.
3.1.3 NatWest shall not be obliged to take any action to recover the
Liabilities from the Borrowers before making demand for
indemnification against FNBM under this Clause 3.1.
3.2 COUNTER-INDEMNITY BY THE BORROWERS
3.2.1 Each of the Borrowers hereby unconditionally and irrevocably, and
jointly and severally, agree and undertake to each of NatWest and
FNBM as follows:
(a) to indemnify NatWest and FNBM and to keep NatWest and FNBM fully
and effectively indemnified against all actions, proceedings,
claims, damages, demands, losses, liabilities, costs, charges
and expenses (including, for the avoidance of doubt, any such
arising under any of the indemnities given by FNBM to NatWest
under Clause 3.1) which are at any time brought or preferred
against NatWest and/or FNBM or which either or both of them
at any time incurs arising out of or in
connection with the provision of the First New Overdraft Facility;
(b) to pay NatWest and FNBM on demand free of all set-off, counterclaim or
other deductions of any nature whatsoever all payments, losses, costs
and expenses suffered or incurred or arising in relation to the First
New Overdraft Facility together with interest thereon calculated in
accordance with the provisions of and at the rate specified in
Paragraph 6.1.1 of the New Facility Letter which interest shall accrue
and be payable as from the date on which such payments, losses, costs
and expenses are paid or incurred by NatWest and/or FNBM without the
necessity for any demand being first made for payment thereof; and
(c) that until all obligations, indebtedness or liabilities (whether
actual or contingent) of the Borrowers to both NatWest and FNBM have
been fully and effectively discharged the Borrowers shall not be
entitled to share in any security held or money received by NatWest
and/or FNBM on account of the same or to stand in the place of NatWest
and/or FNBM in respect of any such security or money or take any step
to enforce any right or claim against the Borrowers in respect of any
monies paid by the Borrowers to NatWest and/or FNBM or exercise any
right of surety in competition with NatWest and/or FNBM and that the
obligations of the Borrowers under this Clause 3.2.1 shall not be
discharged nor shall the liability of the Borrowers hereunder be
affected or reduced by reason of any failure of or irregularity,
defect or informality in any security nor by any legal limitation, bar
or restriction, disability, incapacity or want of any borrowing powers
of the Borrowers or want of authority of any director, manager,
official or other person appearing to be acting for the Borrowers in
any matter in respect of the monies or liabilities hereby secured or
by any supervening matters rendering the performance of the
obligations of the Borrowers illegal in any jurisdiction and such
monies or liabilities will be recoverable by the NatWest and FNBM from
the Borrowers as sole or as principal debtors.
3.2.2 For the avoidance of doubt the Borrowers shall not be obliged to
pay under the indemnity contained in Clause 3.2.1 any more than
they would have had to pay had they made payment in full of all
sums owing in respect of the First New Overdraft Facility and any
costs and expenses attributable to the collection of the same.
4. RISK-SHARING BY FNBM AND COMERICA
4.1.1 Each of FNBM and Comerica severally hereby irrevocably and
unconditionally agrees and undertakes to NatWest to indemnify
NatWest and to keep NatWest fully and effectively indemnified
on demand and free of any set-off, counterclaim or other
deductions against all losses, liabilities, costs, charges and
expenses which NatWest at any time incurs or suffers arising
out of or in connection with the provision of the Second New
Overdraft Facility (including for the avoidance of doubt the
Second New Overdraft Outstandings) (other than in respect of gross
negligence or wilful misconduct on the part of NatWest)
(the "Liabilities") PROVIDED THAT FNBM and Comerica shall only be
obliged to indemnify NatWest under this Clause to the extent
of an amount equivalent to their respective Second
Participation Percentage of the Liabilities.
4.1.2 A certificate of an officer of NatWest as to the amount of the
Liabilities shall, save in the case of manifest error, be binding
on FNBM and Comerica.
4.1.3 NatWest shall not be obliged to take any action to recover the
Liabilities from the Borrowers before making demand for
indemnification against FNBM and Comerica under this Clause 4.1.
4.2 COUNTER-INDEMNITY BY THE BORROWERS
4.2.1 Subject to Clause 4.2.2 each of the Borrowers hereby
unconditionally and irrevocably, and jointly and severally, agree
and undertake to each of NatWest, Comerica and FNBM as follows:
(a) to indemnify NatWest, Comerica and FNBM and to keep NatWest, Comerica
and FNBM fully and effectively indemnified against all actions,
proceedings, claims, damages, demands, losses, liabilities, costs,
charges and expenses (including, for the avoidance of doubt, any such
arising under any of the indemnities given by FNBM, Comerica to
NatWest under Clause 4.1) which are at any time brought or preferred
against NatWest and/or Comerica and/or FNBM or which any or all of
them at any time incurs arising out of or in connection with the
provision of the Second New Overdraft Facility;
(b) to pay NatWest, Comerica and FNBM on demand free of all set-off,
counterclaim or other deductions of any nature whatsoever all
payments, losses, costs and expenses suffered or incurred or arising
in relation to the Second New Overdraft Facility together with
interest thereon calculated in accordance with the provisions of and
at the rate specified in Paragraph 6.1.1 of the New Facility Letter
which interest shall accrue and be payable as from the date on which
such payments, losses, costs and expenses are paid or incurred by
NatWest and/or Comerica and/or FNBM without the necessity for any
demand being first made for payment thereof; and
(c) that until all obligations, indebtedness or liabilities (whether actual
or contingent) of the Borrowers to each of NatWest, Comerica and FNBM
have been fully and effectively discharged the Borrowers shall not be
entitled to share in any security held or money received by NatWest
and/or Comerica and/or FNBM on account of the same or to stand in the
place of NatWest and/or Comerica and/or FNBM in respect of any such
security or money or take any step to enforce any right or claim against
the Borrowers in respect of any monies paid by the Borrowers to NatWest
and/or Comerica and/or FNBM or exercise any right of surety in
competition with NatWest and/or Comerica and/or FNBM and that the
obligations of the Borrowers under this Clause 4.2.1 shall not be
discharged nor shall the liability of the Borrowers hereunder be
affected or reduced by reason of any failure of or irregularity,
defect or informality in any security nor by any legal limitation,
bar or restriction, disability, incapacity or want of any borrowing
powers of the Borrowers or want of authority of any director, manager,
official or other person appearing to be acting for the Borrowers in
any matter in respect of the monies or liabilities hereby secured or
by any supervening matters rendering the performance of the obligations
of the Borrowers illegal in any jurisdiction and such monies or
liabilities will be recoverable by the NatWest and Comerica and FNBM
from the Borrowers as sole or as principal debtors.
4.2.2 For the avoidance of doubt the Borrowers shall not be obliged to
pay under the indemnity contained in Clause 4.2.1 any more than
they would have had to pay had they made payment in full of all
sums owing in respect of the Second New Overdraft Facility and any
costs and expenses attributable to the collection of the same.
5. MAKING DEMAND
Each of the Banks hereby agrees with the other Bank that NatWest in
its capacity as Agent and as Overdraft Bank shall not and shall not
be obliged to make any demand for repayment of the Facilities or
the Overdraft Facilities or the Bridging Facility without having
obtained the prior written authority of all of the Banks.
6. CO-OPERATION
The Agent and the Banks shall co-operate to ensure that any moneys
in the hands of a receiver appointed pursuant to any of the
Security are distributed in a manner consistent with the provisions
of this Agreement.
7. NO OBLIGATIONS TO BORROWERS
7.1 The Borrowers join in this Agreement to acknowledge the arrangements
made between the Banks and the Agent in this Agreement and to give the
indemnities set out in Clauses 3.2 and 4.2 but shall have no rights
under this Agreement.
7.2 Nothing in this Agreement shall as between the Borrowers on the one hand
and the Banks on the other hand affect or prejudice any rights or
remedies under the Security.
8. REPLACEMENT
This Agreement supersedes and replaces the Intercreditor Agreements
dated 17th March 1998 and 26th February 1998 except that the
provisions of Clause 3 of the latter agreement remain in force.
9. COUNTERPARTS
This Agreement may be executed in any number of counterparts and
all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
10. LAW AND JURISDICTION
This Agreement shall be governed by, and construed in all respects
in accordance with English law.
IN WITNESS whereof the parties hereto causes this Agreement to be duly executed
on the date set out above.
SCHEDULE 1
Participation in Risk-Sharing
Bank First Participation Percentage Second Participation Percentage
NatWest 71.429% 47.619%
FNBM 28.571% 28.571%
Comerica -- 23.810%
SCHEDULE 2
Security
Document Executed by Date
1. Guarantee and Debenture in favour of the Agent as amended by a Parent 1.11.95
Supplemental Deed dated 20th January 1998 and a Supplemental Deed
dated 26th February 1998
2. Guarantee and Debenture in favour of the Agent as amended by a HLSL
21.11.95 Supplemental Deed dated 20th January 1998 and a Supplemental
Deed dated 26th February 1998
3. Guarantee in favour of the Agent as amended by a Supplemental Deed HLS 21.11.95
dated 20th January 1998 and a Supplemental Deed dated 26th
February 1998
4. Security Agreement in favour of the Agent as amended by a HLS 21.11.95
Supplemental Deed dated 20th January 1998 and a Supplemental Deed
dated 26th February 1998
5. Mortgage in favour of the Agent over the New Jersey Property as HLS
16.01.98 amended by a Supplemental Deed dated 26th February 1998
6. Equipment Mortgage in favour of the Agent HLSL 20.04.98
7. Security Agreement incorporating an Equipment Mortgage and a HLS 30.04.98
Charge over an Operating Account in favour of the Agent
SIGNED by ) X X XXXXXXXX
X X XXXXXXXX )
for and on behalf of NATIONAL WESTMINSTER BANK Plc )
(as Agent) )
SIGNED by ) X X XXXXXXXX
X X XXXXXXXX )
for and on behalf of NATIONAL WESTMINSTER BANK Plc )
(as a Bank) )
SIGNED by ) XXXXXX XXXXXXXX
XXXXXX XXXXXXXX )
for and on behalf of THE FIRST NATIONAL BANK OF )
MARYLAND (as a Bank) )
SIGNED by ) XXXXX XXXXXX
XXXXX XXXXXX )
for and on behalf of COMERICA BANK (as a Bank) )
)
SIGNED by ) XXXXXXXXXXX XXXXXX
XXXXXXXXXXX XXXXXX )
for and on behalf of HUNTINGDON LIFE SCIENCES GROUP )
plc )
SIGNED by ) XXXXXXXXXXX XXXXXX
XXXXXXXXXXX XXXXXX )
for and on behalf of HUNTINGDON LIFE SCIENCES )
LIMITED )
SIGNED by ) XXXXXXXXXXX XXXXXX
XXXXXXXXXXX XXXXXX )
for and on behalf of HUNTINGDON LIFE SCIENCES, INC. )
)
